U.S.$475,000,000
CREDIT AGREEMENT,
dated as of November 30, 1999,
among
OUTSOURCING SOLUTIONS INC.,
as the Borrower,
VARIOUS FINANCIAL INSTITUTIONS AND OTHER PERSONS
FROM TIME TO TIME PARTIES HERETO,
as the Lenders,
DLJ CAPITAL FUNDING, INC.,
as the Syndication Agent,
HARRIS TRUST AND SAVINGS BANK,
as the Documentation Agent,
and
FLEET NATIONAL BANK,
as the Administrative Agent.
ARRANGED BY:
DLJ CAPITAL FUNDING, INC.
TABLE OF CONTENTS
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms.....................................................3
1.2. Use of Defined Terms.............................................39
1.3. Cross-References.................................................40
1.4. Accounting and Financial Determinations; etc.....................40
ARTICLE II COMMITMENTS, BORROWING AND ISSUANCE PROCEDURES, NOTES AND LETTERS OF
CREDIT
2.1. Commitments......................................................40
2.1.1. Revolving Loan Commitment and Swing Line Loan Commitment.........40
2.1.2. Letter of Credit Commitment......................................41
2.1.3. Term A Loan Commitment...........................................42
2.1.4. Term B Loan Commitment...........................................42
2.2. Reduction of the Commitment Amounts..............................42
2.2.1. Optional.........................................................42
2.2.2. Mandatory........................................................42
2.3. Borrowing Procedures.............................................43
2.3.1. Borrowing Procedure..............................................43
2.3.2. Swing Line Loans.................................................43
2.4. Continuation and Conversion Elections............................45
2.5. Funding..........................................................45
2.6. Issuance Procedures..............................................46
2.6.1. Other Lenders' Participation.....................................46
2.6.2. Disbursements....................................................46
2.6.3. Reimbursement....................................................47
2.6.4. Deemed Disbursements.............................................47
2.6.5. Nature of Reimbursement Obligations..............................48
2.7. Register; Notes..................................................48
ARTICLE III REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
3.1. Repayments and Prepayments; Application..........................50
3.1.1. Repayments and Prepayments.......................................50
3.1.2. Application......................................................54
3.2. Interest Provisions..............................................55
3.2.1. Rates............................................................55
3.2.2. Post-Maturity Rates..............................................55
3.2.3. Payment Dates....................................................55
3.3. Fees.............................................................56
3.3.1. Commitment Fee...................................................56
3.3.2. Administrative Agent's Fees......................................56
3.3.3. Letter of Credit Fee.............................................56
ARTICLE IV CERTAIN LIBO RATE AND OTHER PROVISIONS
4.1. LIBO Rate Lending Unlawful.......................................57
4.2. Deposits Unavailable.............................................57
4.3. Increased LIBO Rate Loan Costs, etc..............................57
4.4. Funding Losses...................................................58
4.5. Increased Capital Costs..........................................58
4.6. Taxes............................................................59
4.7. Payments, Computations, etc......................................62
4.8. Sharing of Payments..............................................62
4.9. Setoff...........................................................63
4.10. Change of Lending Office.........................................63
4.11. Replacement of Lenders...........................................63
4.12. Limitation on Additional Amounts, etc............................64
ARTICLE V CONDITIONS TO CREDIT EXTENSIONS
5.1. Initial Credit Extension.........................................65
5.1.1. Resolutions, etc.................................................65
5.1.2. Transaction Consummated..........................................65
5.1.3. Transaction Documents............................................66
5.1.4. Closing Date Certificate.........................................67
5.1.5. Delivery of Notes................................................67
5.1.6. Payment of Outstanding Indebtedness, etc.........................67
5.1.7. Administrative Agent's Fee Letter, Closing Fees, Expenses, etc...67
5.1.8. Financial Information; Material Adverse Change...................68
5.1.9. Opinions of Counsel; Reliance Letters............................68
5.1.10. Filing Agent, etc................................................68
5.1.11. Subsidiary Guaranty..............................................69
5.1.12. Solvency, etc....................................................69
5.1.13. Pledge Agreements................................................69
5.1.14. Patent Security Agreement, Copyright Security Agreement
and Trademark Security Agreement...............................70
5.1.15. Perfection Certificates..........................................70
5.1.16. Insurance........................................................70
5.1.17. Corporate, Tax and Capital Structure.............................71
5.1.18. Litigation.......................................................71
5.2. All Credit Extensions............................................71
5.2.1. Compliance with Warranties, No Default, etc......................71
5.2.2. Credit Extension Request, etc....................................71
5.2.3. Satisfactory Legal Form..........................................71
ARTICLE VI REPRESENTATIONS AND WARRANTIES
6.1. Organization, etc................................................72
6.2. Due Authorization, Non-Contravention, etc........................72
6.3. Government Approval, Regulation, etc.............................72
6.4. Validity, etc....................................................73
6.5. Financial Information............................................73
6.6. No Material Adverse Change.......................................73
6.7. Litigation, Labor Controversies, etc.............................73
6.8. Subsidiaries.....................................................74
6.9. Ownership of Properties; Capital Securities......................74
6.10. Taxes............................................................74
6.11. Pension and Welfare Plans........................................74
6.12. Environmental Warranties.........................................75
6.13. Accuracy of Information..........................................76
6.14. Regulations U and X..............................................76
6.15. Year 2000........................................................76
6.16. Status of Obligations as Senior Indebtedness, etc................76
6.17. Solvency.........................................................77
ARTICLE VII COVENANTS
7.1. Affirmative Covenants............................................77
7.1.1. Financial Information, Reports, Notices, etc.....................77
7.1.2. Maintenance of Existence; Compliance with Laws, etc..............79
7.1.3. Maintenance of Properties........................................79
7.1.4. Insurance........................................................80
7.1.5. Books and Records................................................80
7.1.6. Environmental Law Covenant.......................................81
7.1.7. Use of Proceeds..................................................81
7.1.8. Subsidiary Guarantors, Security, etc.............................82
7.1.9. Hedging Obligations..............................................82
7.1.10. Year 2000........................................................83
7.1.11. Maintenance of Corporate Separateness............................83
7.1.12. Existing and Future Owned Real Property..........................83
7.1.13. Permitted Receivables Transaction................................84
7.2. Negative Covenants...............................................85
7.2.1. Business Activities..............................................85
7.2.2. Indebtedness.....................................................85
7.2.3. Liens............................................................88
7.2.4. Financial Condition and Operations...............................90
7.2.5. Investments......................................................93
7.2.6. Restricted Payments, etc.........................................95
7.2.7. Capital Expenditures, etc........................................96
7.2.8. No Prepayment of Subordinated Debt...............................97
7.2.9. Issuance of Capital Securities...................................97
7.2.10. Consolidation, Merger, etc.......................................98
7.2.11. Permitted Dispositions...........................................98
7.2.12. Modification of Certain Documents................................99
7.2.13. Transactions with Affiliates.....................................99
7.2.14. Restrictive Agreements, etc......................................99
7.2.15. Sale and Leaseback..............................................100
7.2.16. Accounting Changes..............................................100
7.3. UAS and the Student Loan Collection Business....................100
7.3.1. Business Activities.............................................100
7.3.2. Indebtedness....................................................100
7.3.3. Liens...........................................................101
7.3.4. Investments.....................................................101
7.3.5. Restricted Payments, etc........................................101
7.3.6. Consolidation, Merger...........................................101
7.4. OSIFC...........................................................101
ARTICLE VIII EVENTS OF DEFAULT
8.1. Listing of Events of Default....................................101
8.1.1. Non-Payment of Obligations......................................101
8.1.2. Breach of Warranty..............................................102
8.1.3. Non-Performance of Certain Covenants and Obligations............102
8.1.4. Non-Performance of Other Covenants and Obligations..............102
8.1.5. Default on Other Indebtedness...................................102
8.1.6. Judgments.......................................................102
8.1.7. Pension Plans...................................................102
8.1.8. Change in Control...............................................103
8.1.9. Bankruptcy, Insolvency, etc.....................................103
8.1.10. Impairment of Security, etc.....................................103
8.1.11. Failure of Subordination........................................104
8.1.12. Redemption......................................................104
8.2. Action if Bankruptcy............................................104
8.3. Action if Other Event of Default................................104
ARTICLE IX
THE AGENTS
9.1. Actions.........................................................105
9.2. Funding Reliance, etc...........................................105
9.3. Exculpation; Notice of Default..................................105
9.4. Successors......................................................106
9.5. Credit Extensions by each Managing Agent and each Issuer........107
9.6. Credit Decisions................................................107
9.7. Copies, etc.....................................................107
9.8. Reliance by Managing Agents and Issuers.........................107
9.9. The Managing Agents and the Issuers.............................108
9.10. Documentation Agent.............................................108
ARTICLE X MISCELLANEOUS PROVISIONS
10.1. Waivers, Amendments, etc........................................108
10.2. Notices; Time...................................................110
10.3. Payment of Costs and Expenses...................................110
10.4. Indemnification.................................................111
10.5. Survival........................................................112
10.6. Severability....................................................112
10.7. Headings........................................................112
10.8. Execution in Counterparts, Effectiveness, etc...................113
10.9. Governing Law; Entire Agreement.................................113
10.10. Successors and Assigns..........................................113
10.11. Sale and Transfer of Credit Extensions; Participations in
Credit Extensions Notes.......................................113
10.11.1. Assignments.....................................................113
10.11.2. Participations..................................................115
10.12. Other Transactions..............................................116
10.13. Independence of Covenants.......................................117
10.14. Confidentiality.................................................117
10.15. Forum Selection and Consent to Jurisdiction.....................117
10.16. Waiver of Jury Trial............................................118
SCHEDULE I - Disclosure Schedule
SCHEDULE II - Percentages; Notice Information; LIBOR Office;
Domestic Office
ANNEX I - Corporate and Capital Structure
EXHIBIT A-1 - Form of Revolving Note
EXHIBIT A-2 - Form of Term A Note
EXHIBIT A-3 - Form of Term B Note
EXHIBIT A-4 - Form of Swing Line Note
EXHIBIT B-1 - Form of Borrowing Request
EXHIBIT B-2 - Form of Issuance Request
EXHIBIT C - Form of Continuation/Conversion Notice
EXHIBIT D - Form of Borrower Closing Date Certificate
EXHIBIT E - Form of Compliance Certificate
EXHIBIT F - Form of Subsidiary Guaranty
EXHIBIT G-1 - Form of Shareholders' Pledge Agreement
EXHIBIT G-2 - Form of Borrower Pledge and Security Agreement
EXHIBIT G-3 - Form of Subsidiary Pledge and Security Agreement
EXHIBIT H - Form of Perfection Certificate
EXHIBIT I - Form of Solvency Certificate
EXHIBIT J - Form of Interco Subordination Agreement
EXHIBIT K - Form of Lender Assignment Agreement
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of November 30, 1999, is made by and among
OUTSOURCING SOLUTIONS INC., a Delaware corporation (the "Borrower"), the various
financial institutions and other Persons (as defined below) from time to time
parties hereto (the "Lenders"), DLJ CAPITAL FUNDING, INC. ("DLJ"), as the
syndication agent (in such capacity, the "Syndication Agent"), the Lead Arranger
and the Sole Book Running Manager, HARRIS TRUST AND SAVINGS BANK, as the
documentation agent (in such capacity, the "Documentation Agent"), and FLEET
NATIONAL BANK ("Fleet"), as the administrative agent (in such capacity, the
"Administrative Agent").
W I T N E S S E T H:
WHEREAS, in accordance with and subject to the terms and conditions
contained in the Stock Subscription and Redemption Agreement, dated as of
October 8, 1999 (the "Recapitalization Agreement"), by and among Madison
Dearborn Capital Partners III, L.P., a Delaware limited partnership ("MDCP"),
the Borrower and all of the existing equity holders of the Borrower immediately
prior to the effectiveness of the Recapitalization Agreement (the "Existing
Shareholders"), and upon the consummation of the Transaction referred to below,
(i) MDCP will, by way of a recapitalization (the "Recapitalization"), become the
direct controlling shareholder of the Borrower, and (ii) certain Existing
Shareholders (the "Rollover Shareholders") will retain certain shares of OSI
Common Stock and options to purchase OSI Common Stock;
WHEREAS, in connection with the Recapitalization, the Borrower intends to
refinance (the "Refinancing") its existing senior credit facilities evidenced by
that certain Credit Agreement, dated as of November 6, 1996 (as amended,
supplemented, amended and restated or otherwise modified prior to the Closing
Date, the "Existing Credit Agreement"), among the Borrower, the lenders party
thereto, and certain financial institutions as the co-administrative agents;
WHEREAS, in connection with the Recapitalization, the Borrower delivered a
consent solicitation statement (the "Consent Solicitation Statement") relating
to the Subordinated Notes, dated November 9, 1999, to the holders of the
Subordinated Notes (the "Subordinated Note Holders") pursuant to which the
Borrower solicited (the "Solicitation") the consent of the Subordinated Note
Holders to the waiver of, among other things, the Borrower's obligation pursuant
to Section 4.15 of the Subordinated Note Indenture to make a Change of Control
Offer (as such term is defined in the Subordinated Note Indenture) in connection
with the Recapitalization and any and all consequences arising therefrom under
the Subordinated Note Indenture;
WHEREAS, in connection with the Recapitalization and the Refinancing, and
pursuant to the applicable Transaction Documents, prior to or contemporaneously
with the consummation of the Recapitalization and the making of the initial
Credit Extensions hereunder, the Borrower will
(a) receive common equity proceeds of approximately $200,000,000
pursuant to the Recapitalization Agreement (which proceeds shall have been
paid by MDCP and its designees to the Borrower) such that, immediately
after giving effect to the Recapitalization, MDCP and its designees shall
be the holder of approximately 82.5% of the issued and outstanding OSI
Common Stock, representing more than 77% of the OSI Common Stock on a
fully diluted basis, in each case on the Closing Date;
(b) issue (the "PIK Preferred Equity Issuance"), on terms and
conditions, and pursuant to documentation (the "PIK Preferred Equity
Documents"), reasonably satisfactory in all respects to the Managing
Agents, redeemable preferred equity securities (the "PIK Preferred
Equity") for not less than $100,000,000 in gross cash proceeds to certain
purchasers thereof (collectively, the "PIK Preferred Equity Holders"); and
(c) issue (the "Junior PIK Preferred Equity Issuance" and, together
with the PIK Preferred Equity Issuance, the "Preferred Equity Issuances"),
on terms and conditions, and pursuant to documentation (the "Junior PIK
Preferred Equity Documents" and, together with the PIK Preferred Equity
Documents, the "Preferred Equity Documents"), reasonably satisfactory in
all respects to the Managing Agents, preferred equity securities (the
"Junior PIK Preferred Equity" and, together with the PIK Preferred Equity,
the "Preferred Equity") to certain of the Existing Shareholders (together
with the PIK Preferred Equity Holders, the "Preferred Equity Holders") for
not less than $7,000,000 of gross cash proceeds, in connection with the
Recapitalization.
The transactions set forth in clauses (a) through (c) above, together with the
Recapitalization, the Refinancing, the Solicitation and each of the other
transactions contemplated thereby and hereby (including the initial Credit
Extensions hereunder, but excluding any Credit Extensions made after the Closing
Date), shall hereinafter be collectively referred to as the "Transaction", which
Transaction shall be consummated for an aggregate amount of approximately
$826,000,000 (which shall include the payment of Transaction-related fees and
expenses not in excess of $47,000,000);
WHEREAS, in order to partially finance the Transaction and in connection
with the post-closing ongoing working capital and general corporate needs of the
Borrower and its Subsidiaries, the Borrower desires to obtain the following
financing facilities from the Lenders:
(a) a Term A Loan Commitment and a Term B Loan Commitment pursuant
to which Borrowings of Term Loans will be made to the Borrower on the
Closing Date in a maximum, original principal amount of $150,000,000 (in
the case of Term A Loans) and $250,000,000 (in the case of Term B Loans);
(b) a Revolving Loan Commitment (to include availability for
Revolving Loans, Swing Line Loans and Letters of Credit) pursuant to which
Borrowings of Revolving Loans, in a maximum aggregate principal amount
(together with all Swing Line Loans and Letter of Credit Outstandings) not
to exceed $75,000,000 will be made to the Borrower from time to time on
and subsequent to the Closing Date but prior to the Revolving Loan
Commitment Termination Date;
(c) a Letter of Credit Commitment pursuant to which the Issuer will
issue Letters of Credit for the account of the Borrower and the Subsidiary
Guarantors from time to time on and subsequent to the Closing Date but
prior to the Revolving Loan Commitment Termination Date in a maximum
aggregate Stated Amount at any one time outstanding not to exceed
$25,000,000 (provided, that the aggregate outstanding principal amount of
Revolving Loans and Swing Line Loans, and Letter of Credit Outstandings at
any time shall not exceed the then existing Revolving Loan Commitment
Amount); and
(d) a Swing Line Loan Commitment pursuant to which Swing Line Loans
will be made to the Borrower from time to time on and subsequent to the
Closing Date but prior to the Revolving Loan Commitment Termination Date;
and
WHEREAS, the Lenders and the Issuer are willing, on the terms and subject
to the conditions hereinafter set forth, to extend the Commitments and make
Loans to the Borrower and issue (or participate in) Letters of Credit;
NOW, THEREFORE, the parties hereto agree as follows.
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):
"Account" means any account (as that term is defined in Section 9-106 of
the UCC) of the Borrower or any of its Subsidiaries arising from the sale or
lease of goods or rendering of services.
"Adjusted Base Rate" means, for any day, a rate per annum equal to the
greater of (a) the Prime Rate in effect on such day, and (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. Any change in the Adjusted
Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate
shall be effective from and including the effective date of such change in the
Prime Rate or the Federal Funds Effective Rate, respectively.
"Adjusted LIBO Rate" means, with respect to any LIBO Rate Loan for any
Interest Period, an interest rate per annum (rounded upwards, if necessary, to
the next 1/100 of 1%) equal to (a) the LIBO Rate for such Interest Period
multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" is defined in the preamble and includes each other
Person appointed as the successor Administrative Agent pursuant to Section 9.4.
"Administrative Agent's Fee Letter" means the confidential letter, dated
December 1, 1999, between the Borrower and the Administrative Agent.
"Affected Lender" is defined in Section 4.11.
"Affiliate" of any Person means any other Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person. "Control" of a Person means the power, directly or indirectly, (a) to
vote (under ordinary circumstances) 10% or more of the Capital Securities (on a
fully diluted basis) of such Person for the election of directors, managing
members or general partners (as applicable) or (b) to direct or cause the
direction of the management and policies of such Person (whether by contract or
otherwise).
"Agreement" means, on any date, this Credit Agreement as originally in
effect on the Closing Date and as thereafter from time to time amended,
supplemented, amended and restated or otherwise modified from time to time and
in effect on such date.
"Alternative Receivables Program" is defined in clause (a) of Section
7.1.13.
"Annualized Basis" means, (a) with respect to the end of the first Fiscal
Quarter of the Borrower ending after the Closing Date, the applicable amount for
such Fiscal Quarter multiplied by four, (b) with respect to the second Fiscal
Quarter of the Borrower ending after the Closing Date, the applicable amount for
such Fiscal Quarter and the immediately preceding Fiscal Quarter multiplied by
two, and (c) with respect to the third Fiscal Quarter of the Borrower ending
after the Closing Date, the applicable amount for such Fiscal Quarter and the
immediately preceding two Fiscal Quarters multiplied by one and one-third.
"Applicable Commitment Fee" means, (a) for each day from the Closing Date
to (but excluding) the date upon which the Compliance Certificate for the second
full Fiscal Quarter to have commenced and ended after the Closing Date is
required to be delivered by the Borrower to the Administrative Agent pursuant to
clause (c) of Section 7.1.1, a fee which shall accrue at a rate of 1/2 of 1% per
annum, and (b) at all times from the date the Compliance Certificate described
in clause (a) above is required to be delivered, a fee which shall accrue at the
applicable rate per annum set forth below under the column entitled "Applicable
Commitment Fee", determined by reference to the applicable Leverage Ratio
referred to below:
Leverage Ratio Applicable Commitment Fee
-------------- -------------------------
greater than or equal
to 4.00:1.00 0.500%
less than 4.00:1.00 0.375%
The Leverage Ratio used to compute the Applicable Commitment Fee shall be that
set forth in the Compliance Certificate most recently delivered by the Borrower
to the Administrative Agent; changes in the Applicable Commitment Fee resulting
from a change in the Leverage Ratio shall become effective upon delivery by the
Borrower to the Administrative Agent of a new Compliance Certificate pursuant to
clause (c) of Section 7.1.1. If the Borrower shall fail to deliver a Compliance
Certificate by the delivery due date specified in such clause, the Applicable
Commitment Fee from and including the day immediately following such delivery
due date to (but excluding) the date the Borrower delivers to the Administrative
Agent a Compliance Certificate shall conclusively be equal to the highest
Applicable Commitment Fee set forth above.
"Applicable Margin" means, at all times during the applicable periods set
forth below,
(a) on any date, with respect to the unpaid principal amount of each
Term B Loan maintained as a (i) Base Rate Loan, 3.00% per annum and (ii)
LIBO Rate Loan, 4.00% per annum;
(b) from the Closing Date to (but excluding) the date upon which the
Compliance Certificate for the second full Fiscal Quarter to have
commenced and ended after the Closing Date is required to be delivered by
the Borrower to the Administrative Agent pursuant to clause (c) of Section
7.1.1, with respect to the unpaid principal amount of each (i) Revolving
Loan and Term A Loan maintained as a Base Rate Loan, 2.25% per annum, and
(ii) Revolving Loan and Term A Loan maintained as a LIBO Rate Loan, 3.25%
per annum; and
(c) at all times from the date the Compliance Certificate described
in clause (b) above is required to be delivered, with respect to the
unpaid principal amount of each Revolving Loan and Term A Loan, the rate
determined by reference to the applicable Leverage Ratio and at the
applicable percentage per annum set forth below under the column entitled
"Applicable Margin for Base Rate Loans", in the case of such Loans made or
maintained as Base Rate Loans, or by reference to the applicable Leverage
Ratio and at the applicable percentage per annum set forth below under the
column entitled "Applicable Margin for LIBO Rate Loans", in the case of
such Loans made or maintained as LIBO Rate Loans:
Applicable Applicable
Leverage Ratio Margin For Margin For
Base Rate Loans LIBO Rate Loans
greater than or equal
to 4.00:1.00 2.25% 3.25%
greater than or equal to
3.50:1.00 and less than 1.75% 2.75%
4.00:1.00
greater than or equal to
2.75:1.00 and less than 1.25% 2.25%
3.50:1.00
less than 2.75:1.00 0.75% 1.75%
The Leverage Ratio used to compute the Applicable Margin shall be the Leverage
Ratio set forth in the Compliance Certificate most recently delivered by the
Borrower to the Administrative Agent; changes in the Applicable Margin resulting
from a change in the Leverage Ratio shall become effective upon delivery by the
Borrower to the Administrative Agent of a new Compliance Certificate pursuant to
clause (c) of Section 7.1.1. If the Borrower shall fail to deliver a Compliance
Certificate by the delivery due date specified in such clause, the Applicable
Margin from and including the day immediately following such delivery due date
to (but excluding) the date the Borrower delivers to the Administrative Agent a
Compliance Certificate shall conclusively be equal to the highest Applicable
Margin set forth above.
"Assignee Lender" is defined in Section 10.11.1.
"Assignor Lender" is defined in Section 10.11.1.
"Authorized Officer" is defined in clause (b) of Section 5.1.1.
"Base Rate Loan" means a Loan bearing interest at a fluctuating rate
determined by reference to the Adjusted Base Rate.
"Board" means the Board of Governors of the Federal Reserve System of the
United States of America.
"Borrower" is defined in the preamble.
"Borrower Closing Date Certificate" means the closing date certificate
executed and delivered by the Borrower pursuant to the terms of this Agreement,
substantially in the form of Exhibit D hereto.
"Borrower Pledge and Security Agreement" means the Pledge and Security
Agreement executed and delivered by an Authorized Officer of the Borrower,
substantially in the form of Exhibit G-2 hereto, together with any supplemental
Foreign Pledge Agreements delivered from time to time pursuant to any Loan
Document, in each case as amended, supplemented, amended and restated or
otherwise modified from time to time.
"Borrowing" means the Loans of the same type and, in the case of LIBO Rate
Loans, having the same Interest Period made by all Lenders required to make such
Loans on the same Business Day and pursuant to the same Borrowing Request in
accordance with Section 2.1.
"Borrowing Request" means a Loan request and certificate duly executed by
an Authorized Officer of the Borrower, substantially in the form of Exhibit B-1
hereto.
"Business Day" means any day that is not a Saturday, Sunday or other day
on which commercial banks in Boston, Massachusetts or New York City are
authorized or required by law to remain closed; provided, that when used in
connection with a LIBO Rate Loan, the term "Business Day" shall also exclude any
day on which banks are not open for dealings in Dollar deposits in the London
interbank market.
"Capital Expenditures" means for any period, the sum of (a) the aggregate
amount of all expenditures of the Borrower and its Subsidiaries for fixed or
capital assets made during such period which, in accordance with GAAP, would be
classified as capital expenditures, and (b) the aggregate amount of the
principal component of all Capitalized Lease Liabilities incurred during such
period by the Borrower and its Subsidiaries; provided, that Capital Expenditures
shall not include (i) any such expenditures or any such principal component
funded with (x) any Casualty Proceeds, as permitted under clause (h) of Section
3.1.1 or (y) any Net Disposition Proceeds or the proceeds received from any
Disposition of obsolete equipment permitted under clause (a) of Section 7.2.11
(collectively referred to as the "Excluded Proceeds"); or (ii) any Investment
made under Section 7.2.5 (other than pursuant to clause (d)(i) thereof, but then
only to the extent such expenditures were not funded with Excluded Proceeds).
"Capital Securities" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) of such Person's capital, whether now outstanding
or issued after the Closing Date.
"Capitalized Lease Liabilities" means all monetary obligations of the
Borrower or any of its Subsidiaries under any leasing or similar arrangement
which have been (or, in accordance with GAAP, should be) classified as
capitalized leases, and for purposes of each Loan Document the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP, and the stated maturity thereof shall be the date of the last payment
of rent or any other amount due under such lease prior to the first date upon
which such lease may be terminated by the lessee without payment of a premium or
a penalty.
"Carry-Forward Amount" is defined in Section 7.2.7.
"Cash Collateralize" means, with respect to a Letter of Credit, the
deposit of immediately available funds into a cash collateral account maintained
with (or on behalf of) the Administrative Agent on terms satisfactory to the
Administrative Agent in an amount equal to the Stated Amount of such Letter of
Credit.
"Cash Equivalent Investment" means, at any time:
(a) any direct obligation of (or unconditionally guaranteed by) the
United States (or any agency or political subdivision thereof, to the
extent such obligations are supported by the full faith and credit of the
United States) maturing not more than one year from the date of
acquisition thereof;
(b) any direct obligation issued by any State of the United States
(or any agency or political subdivision thereof) maturing not more than
one year from the date of acquisition thereof and (i) backed by the full
faith and credit of such State or (ii) at the time of acquisition, having
the highest rating obtainable from either S&P or Moody's;
(c) commercial paper maturing not more than 365 days from the date
of acquisition and rated A-1 or higher by S&P or P-1 or higher by Moody's;
(d) any certificate of deposit, time deposit, or bankers acceptance,
maturing not more than one year after its date of acquisition, or any
demand deposit accounts which, in any case, is issued by or established at
either (i) any bank organized under the laws of the United States (or any
State thereof) and which has (x) a credit rating of A2 or higher from
Moody's or A or higher from S&P and (y) a combined capital and surplus
greater than $250,000,000 or (ii) any Lender;
(e) any repurchase agreement having a term of 7 days or less entered
into with any Lender or any commercial banking institution satisfying the
criteria set forth in clause (c)(i) which (i) is secured by a fully
perfected security interest in any obligation of the type described in
clause (a), and (ii) has a market value at the time such repurchase
agreement is entered into of not less than 100% of the repurchase
obligation of such commercial banking institution thereunder; or
(f) shares of investment companies that are registered under the
Investment Company Act of 1940, as amended, and that invest solely in one
or more of the types of securities described in clauses (a) through (e)
above.
"Casualty Event" means the damage, destruction or condemnation, as the
case may be, of any property of the Borrower or any of its Subsidiaries.
"Casualty Proceeds" means, with respect to any Casualty Event, the cash
amount of any insurance proceeds under any casualty insurance policy or
condemnation awards received by the Borrower or any of its Subsidiaries in
connection therewith, but excluding any proceeds or awards required to be paid
to a creditor (other than the Lenders) which holds a Lien on the property which
is the subject of such Casualty Event which Lien (i) is a Permitted Lien and
(ii) has priority over the Liens securing the Obligations.
"CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
Liability Information System List.
"Change in Control" means
(a) the failure of Madison at any time to, directly or indirectly,
(i) own beneficially on a fully diluted basis at least 51% of the issued
and outstanding OSI Common Stock, all such OSI Common Stock to be held
free and clear of all Liens (other than Liens granted under a Loan
Document) or (ii) have the right to designate or cause to be elected a
majority of the Board of Directors of the Borrower; or
(b) at any time after the creation of a Public Market, any person or
group (within the meaning of Sections 13(d) and 14(d) under the Exchange
Act), other than Madison, becoming the ultimate "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, of Voting Securities representing 30% or more of the Voting
Securities of the Borrower on a fully diluted basis; or
(c) the occurrence of any "Change of Control" (or similar term)
under (and as defined in) any Subordinated Debt Document.
"Closing Date" means the date (which shall be a Business Day) of the
initial Credit Extension hereunder.
"Code" means the Internal Revenue Code of 1986, and the regulations
thereunder, in each case as amended, reformed or otherwise modified from time to
time.
"Commitment" means, as the context may require, a Lender's Term A Loan
Commitment, Term B Loan Commitment, Revolving Loan Commitment, Letter of Credit
Commitment or Swing Line Loan Commitment.
"Commitment Amount" means, as the context may require, the Term A Loan
Commitment Amount, the Term B Loan Commitment Amount, the Revolving Loan
Commitment Amount, the Letter of Credit Commitment Amount or the Swing Line Loan
Commitment Amount.
"Commitment Termination Date" means, as the context may require, the Term
A Loan Commitment Termination Date, the Term B Loan Commitment Termination Date
or the Revolving Loan Commitment Termination Date.
"Commitment Termination Event" means
(a) the occurrence of any Event of Default described in clauses (a)
through (d) of Section 8.1.9 with respect to the Borrower; or
(b) the occurrence and continuance of any other Event of Default and
either (i) the declaration of all or any portion of the Loans to be due
and payable pursuant to Section 8.3 or (ii) the giving of notice by the
Administrative Agent, acting at the direction of the Required Lenders, to
the Borrower that the Commitments have been terminated.
"Compliance Certificate" means a certificate duly completed and executed
by the chief financial or accounting Authorized Officer of the Borrower,
substantially in the form of Exhibit E hereto, together with such changes
thereto as the Administrative Agent may from time to time reasonably request for
the purpose of monitoring the Borrower's compliance with the financial covenants
contained herein.
"Consent Solicitation Statement" is defined in the third recital.
"Contingent Liability" means any agreement, undertaking or arrangement by
which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the Indebtedness of any
other Person (other than by endorsements of instruments in the course of
collection), or guarantees the payment of dividends or other distributions upon
the Capital Securities of any other Person. The amount of any Person's
obligation under any Contingent Liability shall be deemed to be the outstanding
principal amount of the debt, obligation or other liability guaranteed thereby
(reduced to the extent that such Person's obligation thereunder is reduced by
applicable law or valid contractual agreement).
"Continuation/Conversion Notice" means a notice of continuation or
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of Exhibit C hereto.
"Controlled Group" means all members of a controlled group of corporations
and all members of a controlled group of trades or businesses (whether or not
incorporated) under common control which, together with the Borrower, are
treated as a single employer under Section 414(b) or 414(c) of the Code or
Section 4001 of ERISA.
"Copyright Security Agreement" means any Copyright Security Agreement
executed and delivered by any Obligor in substantially the form of Exhibit C to
either Pledge and Security Agreement, as amended, supplemented, amended and
restated or otherwise modified from time to time.
"Credit Extension" means, as the context may require,
(a) the making of a Loan by a Lender; or
(b) the issuance of any Letter of Credit, or the extension of any
Stated Expiry Date of any existing Letter of Credit, by the applicable
Issuer.
"Credit Extension Request" means, as the context may require, any
Borrowing Request or Issuance Request.
"Current Assets" means, on any date, all assets (other than receivables
portfolios owned on the Closing Date and thereafter acquired by the Borrower or
any of its Subsidiaries in connection with any Permitted Portfolio Acquisition)
which, in accordance with GAAP, would be included as current assets on a
consolidated balance sheet of the Borrower and its Subsidiaries at such date as
current assets.
"Current Liabilities" means, on any date, all amounts which, in accordance
with GAAP, would be included as current liabilities on a consolidated balance
sheet of the Borrower and its Subsidiaries at such date, excluding current
maturities of Indebtedness.
"Default" means any Event of Default or any condition, occurrence or event
which, after notice or lapse of time or both, would constitute an Event of
Default.
"Disbursement" is defined in Section 2.6.2.
"Disbursement Date" is defined in Section 2.6.2.
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
Schedule I, as it may be amended, supplemented, amended and restated or
otherwise modified from time to time by the Borrower with the written consent of
the Required Lenders.
"Disposition" (or similar words such as "Dispose") means any sale,
transfer, lease, contribution or other conveyance (including by way of merger)
of, or the granting of options, warrants or other rights to, any of the
Borrower's or its Subsidiaries' assets (including accounts receivables and
Capital Securities of Subsidiaries) to any other Person (other than to another
Obligor) in a single transaction or series of related transactions (provided,
that "Disposition" shall exclude the write-off in the ordinary course of
business of amounts owing to the Borrower or its Subsidiaries which the Borrower
has determined to be uncollectible).
"DLJ" is defined in the preamble.
"Documentation Agent" is defined in the preamble.
"Dollar" and the sign "$" mean lawful money of the United States.
"Domestic Office" means the office of a Lender designated as its "Domestic
Office" on Schedule II hereto or in a Lender Assignment Agreement, or such other
office within the United States as may be designated from time to time by notice
from such Lender to the Administrative Agent and the Borrower.
"Domestic Subsidiary" means any Subsidiary that is incorporated or
organized in or under the laws of the United States, any state thereof or the
District of Columbia.
"EBITDA" means, for any applicable period, the sum for the Borrower and
its Subsidiaries on a consolidated basis of
(a) Net Income,
plus
(b) the amount deducted in determining Net Income representing
non-cash charges or expenses, including depreciation and amortization
(excluding any non-cash charges representing an accrual of or reserve for
cash charges to be paid within the next twelve months),
plus
(c) the amount deducted in determining Net Income representing
income taxes (other than for the OSIFC Family) (whether paid or deferred),
plus
(d) the amount deducted in determining Net Income representing
Interest Expense and all fees, expenses and management bonuses (to the
extent, in the case of management bonuses, paid at or accrued for or prior
to the Closing Date) and financing costs incurred in connection with the
Transaction,
plus
(e) the amount deducted in determining Net Income representing fees
paid to Madison in an aggregate amount not to exceed $500,000 per annum;
provided, however, that "EBITDA" for any such applicable period ending on March
31, 2000, June 30, 2000 and September 30, 2000 shall be increased by an amount
equal to $9,000,000, $6,000,000 and $3,000,000, respectively.
"Environmental Laws" means all applicable and legally binding federal,
state or local statutes, laws, ordinances, codes, rules, regulations and
guidelines (including consent decrees and administrative orders) relating to
public health and safety and protection of the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to Sections of ERISA also refer to any successor Sections thereto.
"Event of Default" is defined in Section 8.1.
"Excess Cash Flow" means, for any applicable period, the excess (if any),
of
(a) EBITDA for such applicable period;
over
(b) the sum (for such applicable period) of
(i) the cash portion of Interest Expense (net of cash
interest income) for such applicable period;
plus
(ii) voluntary and mandatory prepayments of, and scheduled
repayments of, the principal amount of Total Debt, including
Capitalized Lease Liabilities, Term Loans and Revolving Loans
(provided, that, in the case of Revolving Loans, there is a
corresponding permanent reduction in the Revolving Loan Commitment
Amount), in each case, to the extent actually made and for such
applicable period;
plus
(iii) all federal, state and foreign income taxes actually
paid or payable in cash by the Borrower and its Subsidiaries for
such applicable period;
plus
(iv) Capital Expenditures actually made during such applicable
period pursuant to clause (a) of Section 7.2.7 (excluding Capital
Expenditures constituting Capitalized Lease Liabilities and by way
of the incurrence of Indebtedness permitted pursuant to clause (e)
of Section 7.2.2 to a vendor of any assets permitted to be acquired
pursuant to Section 7.2.7 to finance the acquisition of such
assets);
plus
(v) the amount of the net increase (if any) of Current Assets,
other than cash and Cash Equivalent Investments, over Current
Liabilities of the Borrower and its Subsidiaries for such applicable
period;
plus
(vi) Investments permitted and actually made, in cash,
pursuant to clause (d)(i), (g), (k) or (m) of Section 7.2.5 during
such applicable period (excluding Investments financed with the
proceeds of any issuance of Capital Securities or Indebtedness other
than Revolving Loans);
plus
(vii) Restricted Payments (in an amount not to exceed
$500,000) paid pursuant to clause (c) of Section 7.2.6 made during
such applicable period.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excluded Proceeds" is defined in the definition of "Capital
Expenditures".
"Exemption Certificate" is defined in clause (e) of Section 4.6.
"Existing Credit Agreement" is defined in the second recital.
"Existing Letters of Credit" means each letter of credit identified in
Item 2.1.2 of the Disclosure Schedule.
"Existing Shareholders" is defined in the first recital.
"Federal Funds Effective Rate" means, for any day, the weighted average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Fee Letter" means the confidential letter, dated October 8, 1999, between
DLJ and MDCP.
"Filing Agent" is defined in Section 5.1.10.
"Filing Statement" is defined in Section 5.1.10.
"Fiscal Month" means any fiscal month of a Fiscal Year.
"Fiscal Quarter" means a quarter ending on the last day of March, June,
September or December.
"Fiscal Year" means any period of twelve consecutive calendar months
ending on December 31; references to a Fiscal Year with a number corresponding
to any calendar year (e.g., the "2000 Fiscal Year") refer to the Fiscal Year
ending on December 31 of such calendar year.
"Fixed Charge Coverage Ratio" means, at the end of any Fiscal Quarter, the
ratio computed for the period consisting of such Fiscal Quarter and each of the
three immediately prior Fiscal Quarters of
(a) EBITDA for all such Fiscal Quarters
to
(b) the sum of
(i) Capital Expenditures actually made during such applicable
period pursuant to clause (a) of Section 7.2.7 (excluding Capital
Expenditures constituting Capitalized Lease Liabilities and by way
of the incurrence of Indebtedness permitted pursuant to clause (e)
of Section 7.2.2 to a vendor of any assets permitted to be acquired
pursuant to Section 7.2.7 to finance the acquisition of such
assets);
plus
(ii) the cash portion of Interest Expense (net of cash
interest income) for all such Fiscal Quarters, provided that for the
first three Fiscal Quarters ending after the Closing Date, Interest
Expense shall be determined on an Annualized Basis;
plus
(iii) all scheduled payments of principal of Total Debt
(including the Term Loans and the principal portion of any
Capitalized Lease Liabilities) during all such Fiscal Quarters,
provided that for the first three Fiscal Quarters ending after the
Closing Date, such payments shall be determined on an Annualized
Basis;
plus
(iv) Restricted Payments made or permitted to be made pursuant
to clause (a) of Section 7.2.6 during all such Fiscal Quarters;
plus
(v) all federal, state and foreign income taxes actually paid
or payable in cash by the Borrower and its Subsidiaries for all such
Fiscal Quarters.
"Fleet" is defined in the preamble.
"Foreign Pledge Agreement" means any supplemental pledge agreement
governed by the laws of a jurisdiction other than the United States or a State
thereof executed and delivered from time to time by the Borrower or any
Subsidiary Guarantor pursuant to the terms of the applicable Pledge and Security
Agreement, in form and substance reasonably satisfactory to the Administrative
Agent, as may be necessary or desirable under the laws of organization or
incorporation of a Subsidiary to further protect or perfect the Lien on and
security interest in any Collateral (as defined in a Pledge and Security
Agreement).
"Foreign Subsidiary" means any Subsidiary that is not a Domestic
Subsidiary.
"GAAP" is defined in Section 1.4.
"Governmental Authority" means the government of the United States, any
other nation or any political subdivision thereof, whether state or local, and
any agency, authority, instrumentality, regulatory body, court, central bank,
the NAIC or other entity exercising executive, legislative, judicial, taxing,
regulatory or administrative powers or functions of or pertaining to government.
"Hazardous Material" means
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource Conservation
and Recovery Act, as amended;
(c) any petroleum product; or
(d) any pollutant or contaminant or hazardous, dangerous or toxic
chemical, material or substance (including any petroleum product) within
the meaning of any other Environmental Laws.
"Hedging Obligations" means, with respect to any Person, all liabilities
of such Person under currency exchange agreements, interest rate swap
agreements, interest rate cap agreements and interest rate collar agreements,
and all other agreements or arrangements designed to protect such Person against
fluctuations in interest rates or currency exchange rates.
"herein", "hereof", "hereto", "hereunder" and similar terms contained in
any Loan Document refer to such Loan Document as a whole and not to any
particular Section, paragraph or provision of such Loan Document.
"Impermissible Qualification" means, relative to the opinion or
certification of any independent public accountant as to any financial statement
of any Obligor, any qualification or exception to such opinion or certification
(i) which is of a "going concern" or similar nature, (ii) which relates to the
limited scope of examination of matters relevant to such financial statement
(except, in the case of matters relating to any acquired business or assets, in
respect of the period prior to the acquisition by such Obligor of such business
or assets), or (iii) which relates to the treatment or classification of any
item in such financial statement and which, as a condition to its removal, would
require an adjustment to such item the effect of which would be to cause the
Borrower to be in default of any of its obligations under Section 7.2.4.
"including" and "include" means including without limiting the generality
of any description preceding such term, and, for purposes of each Loan Document,
the parties hereto agree that the rule of ejusdem generis shall not be
applicable to limit a general statement, which is followed by or referable to an
enumeration of specific matters, to matters similar to the matters specifically
mentioned.
"Indebtedness" of any Person means:
(a) all obligations of such Person for borrowed money or for the
deferred purchase price of property or services (exclusive of (i) deferred
purchase price arrangements in the nature of open or other accounts
payable owed to suppliers on normal terms in connection with the purchase
of goods and services in the ordinary course of business, (ii) accrued
expenses incurred in the ordinary course of business and (iii) Specified
Liabilities (until such time as the obligation associated with such
Specified Liabilities is recorded as a liability on the balance sheet of
the Borrower in accordance with GAAP)) and all obligations of such Person
evidenced by bonds, debentures, notes or other similar instruments;
(b) all obligations, contingent or otherwise, relative to the face
amount of all letters of credit, whether or not drawn, and banker's
acceptances issued for the account of such Person;
(c) all Capitalized Lease Liabilities;
(d) net liabilities of such Person under all Hedging Obligations;
(e) whether or not so included as liabilities in accordance with
GAAP, all Indebtedness of the types referred to in clauses (a) through (d)
above (excluding prepaid interest thereon) secured by a Lien on property
owned or being purchased by such Person (including Indebtedness arising
under conditional sales or other title retention agreements), whether or
not such Indebtedness shall have been assumed by such Person or is limited
in recourse; provided, however, that, to the extent such Indebtedness is
limited in recourse to the assets securing such Indebtedness, the amount
of such Indebtedness shall be limited to the fair market value of such
assets;
(f) for purposes of Section 8.1.5 only, all other items which, in
accordance with GAAP, would be included as liabilities on the liability
side of the balance sheet of such Person as of the date at which
Indebtedness is to be determined;
(g) all Receivables Facility Outstandings; and
(h) all Contingent Liabilities of such Person in respect of any of
the foregoing.
For all purposes of this Agreement, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture in which such Person is a
general partner or a joint venturer (but only to the extent such Person is
liable for such Indebtedness), but shall not include any preferred stock.
"Indemnified Liabilities" is defined in Section 10.4.
"Indemnified Parties" is defined in Section 10.4.
"Interco Subordination Agreement" means the Intercompany Subordination
Agreement, substantially in the form of Exhibit J hereto, executed and delivered
by two or more Obligors pursuant to the terms of this Agreement, as amended,
supplemented, amended and restated or otherwise modified from time to time.
"Intercompany Note" means, with respect to the Borrower or any of its
Subsidiaries, as the maker thereof, a promissory note substantially in the form
of Exhibit A to any Pledge Agreement (with such modifications as the
Administrative Agent may consent to, such consent not to be unreasonably
withheld), which promissory note shall evidence all intercompany loans which may
be made from time to time by the payee thereunder to such maker and shall be
duly endorsed and pledged by the payee in favor of the Administrative Agent.
"Interest Coverage Ratio" means, at the end of any Fiscal Quarter, the
ratio computed for the period consisting of such Fiscal Quarter and each of the
three immediately prior Fiscal Quarters of:
(a) EBITDA (for all such Fiscal Quarters)
to
(b) the cash portion of Interest Expense (net of cash interest
income) for all such Fiscal Quarters; provided that for the first full
three Fiscal Quarters ending after the Closing Date, Interest Expense
shall be determined on an Annualized Basis.
"Interest Expense" means, for any applicable period, the aggregate
consolidated interest expense of the Borrower and its Subsidiaries for such
applicable period, as determined in accordance with GAAP, including the portion
of any payments made in respect of Capitalized Lease Liabilities allocable to
interest expense, but excluding (to the extent included in interest expense)
up-front fees and expenses and the amortization of all deferred financing costs.
"Interest Period" means, relative to any LIBO Rate Loan, the period
beginning on (and including) the date on which such LIBO Rate Loan is made or
continued as, or converted into, a LIBO Rate Loan pursuant to Section 2.3 or 2.4
and shall end on (but exclude) the day which numerically corresponds to such
date one, two, three or six months thereafter (or, if such month has no
numerically corresponding day, on the last Business Day of such month), as the
Borrower may select in its relevant notice pursuant to Section 2.3 or 2.4;
provided, however, that
(a) the Borrower shall not be permitted to select Interest Periods
to be in effect at any one time which have expiration dates occurring on
more than eight different dates (it being understood that there shall not
be more than eight contracts in respect of LIBO Rate Loans in effect at
any one time);
(b) if such Interest Period would otherwise end on a day which is
not a Business Day, such Interest Period shall end on the next following
Business Day (unless such next following Business Day is the first
Business Day of a calendar month, in which case such Interest Period shall
end on the Business Day next preceding such numerically corresponding
day); and
(c) no Interest Period for any Loan may end later than the Stated
Maturity Date for such Loan.
"Investment" means, relative to any Person,
(a) any loan, advance or extension of credit made by such Person to
any other Person (other than officers and employees in the ordinary course
of business for commissions, travel, relocation and similar expenses),
including the purchase by such Person of any bonds, notes, debentures or
other debt securities of any other Person; and
(b) any Capital Securities acquired by such Person in any other
Person.
The amount of any Investment shall be the original principal or capital amount
thereof less all returns of principal or equity thereon and shall, if made by
the transfer or exchange of property other than cash, be deemed to have been
made in an original principal or capital amount equal to the fair market value
of such property at the time of such Investment.
"ISP Rules" is defined in Section 10.9.
"Issuance Request" means a Letter of Credit request and certificate duly
executed by an Authorized Officer of the Borrower, substantially in the form of
Exhibit B-2 hereto.
"Issuer" means the Administrative Agent in its capacity as Issuer of the
Letters of Credit. At the request of the Administrative Agent and with the
Borrower's consent (not to be unreasonably withheld), another Lender or an
Affiliate of the Administrative Agent may issue one or more Letters of Credit
hereunder. Furthermore, the parties hereto acknowledge and agree that The Chase
Manhattan Bank and BankBoston, N.A. shall each be deemed to be an "Issuer" under
the terms of this Agreement with respect to the Existing Letters of Credit
issued by each one of them.
"Junior PIK Preferred Equity" is defined in clause (c) of the fourth
recital.
"Junior PIK Preferred Equity Documents" is defined in clause (c) of the
fourth recital.
"Junior PIK Preferred Equity Holders" is defined in clause (c) of the
fourth recital.
"Junior PIK Preferred Equity Issuance" is defined in clause (c) of the
fourth recital.
"Lender Assignment Agreement" means an assignment agreement substantially
in the form of Exhibit K hereto.
"Lenders" is defined in the preamble (and includes any Person that becomes
a Lender pursuant to Section 10.11.1).
"Lender's Environmental Liability" means any and all losses, liabilities,
obligations, penalties, claims, litigation, demands, defenses, costs, judgments,
suits, proceedings, damages (including consequential damages), disbursements or
expenses of any kind or nature whatsoever (including reasonable attorneys' fees
at trial and appellate levels and experts' fees and disbursements and expenses
incurred in investigating, defending against or prosecuting any litigation,
claim or proceeding) which may at any time be imposed upon, or asserted or
awarded against, the Administrative Agent, the Syndication Agent, any Lender,
the Issuers or any of such Person's Affiliates, shareholders, directors,
officers, employees, and agents in connection with or arising from:
(a) any Hazardous Material on, in, under or affecting all or any
portion of any property of the Borrower or any of its Subsidiaries, the
groundwater thereunder, or any surrounding areas thereof to the extent
caused by Releases from the Borrower's or any of its Subsidiaries' or any
of their respective predecessors' properties;
(b) any investigation, claim, litigation or proceeding related to
personal injury arising from exposure or alleged exposure to Hazardous
Materials handled by the Borrower or any of its Subsidiaries;
(c) any misrepresentation, inaccuracy or breach of any warranty,
contained or referred to in Section 6.12;
(d) any violation or claim of violation by the Borrower or any of
its Subsidiaries of any Environmental Laws; or
(e) the imposition of any lien for damages caused by or the recovery
of any costs for the cleanup, release or threatened release of Hazardous
Material by the Borrower or any of its Subsidiaries, or in connection with
any property owned or formerly owned by the Borrower or any of its
Subsidiaries.
"Letter of Credit" means (i) any standby letters of credit issued on or
after the Closing Date for the account of the Borrower or any Subsidiary
Guarantor (other than UAS) in accordance with the terms of this Agreement and
(ii) each of the Existing Letters of Credit.
"Letter of Credit Commitment" means the Issuers' obligation to issue
Letters of Credit pursuant to Section 2.1.2 and, with respect to each Revolving
Loan Lender, the obligations of each such Lender to participate in such Letters
of Credit pursuant to Section 2.6.1.
"Letter of Credit Commitment Amount" means, on any date, a maximum amount
of $25,000,000, as such amount may be permanently reduced from time to time
pursuant to Section 2.2.
"Letter of Credit Outstandings" means, on any date, an amount equal to the
sum of (i) the then aggregate amount which is undrawn and available under all
issued and outstanding Letters of Credit, and (ii) the then aggregate amount of
all unpaid and outstanding Reimbursement Obligations.
"Leverage Ratio" means, at the end of any Fiscal Quarter, the ratio of
(a) Total Debt less cash and Cash Equivalent Investments (in each
case, exclusive of the Restricted Cash Balance on such date) of the
Borrower and its Subsidiaries on a consolidated basis outstanding at such
time;
to
(b) EBITDA for the period of four consecutive Fiscal Quarters ended
on such date.
"LIBO Rate" means, with respect to any LIBO Rate Loan for any Interest
Period, the rate appearing on Page 3750 of the Telerate Service (or on any
successor or substitute page of such Service, or any successor to or substitute
for such Service, providing rate quotations comparable to those currently
provided on such page of such Service, as determined by the Administrative Agent
from time to time for purposes of providing quotations of interest rates
applicable to Dollar deposits in the London interbank market) at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period, as the rate for Dollar deposits with a maturity comparable to
such Interest Period. In the event that such rate is not available at such time
for any reason, then the "LIBO Rate" with respect to such LIBO Rate Loan for
such Interest Period shall be the rate at which Dollar deposits of $5,000,000,
and for a maturity comparable to such Interest Period, are offered by the
principal London office of the Administrative Agent in immediately available
funds in the London interbank market at approximately 11:00 a.m., London time,
two Business Days prior to the commencement of such Interest Period.
"LIBO Rate Loan" means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a rate of interest determined by
reference to the Adjusted LIBO Rate.
"LIBOR Office" means the office of a Lender designated as its "LIBOR
Office" on Schedule II hereto or in a Lender Assignment Agreement, or such other
office designated from time to time by notice from such Lender to the Borrower
and the Administrative Agent, whether or not outside the United States, which
shall be making or maintaining the LIBO Rate Loans of such Lender.
"Lien" means any security interest, mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or otherwise),
charge against or interest in property, or other priority or preferential
arrangement of any kind or nature whatsoever, to secure payment of a debt or
performance of an obligation.
"Loan" means, as the context may require, a Revolving Loan, a Term Loan or
a Swing Line Loan of any type.
"Loan Documents" collectively means this Agreement, the Letters of Credit,
the Notes, each Rate Protection Agreement, the Interco Subordination Agreement,
the Fee Letter, the Administrative Agent's Fee Letter, each agreement pursuant
to which the Administrative Agent is granted a Lien to secure the Obligations,
each Credit Extension Request and each other agreement, certificate, document or
instrument (in each case other than any Transaction Documents) delivered in
connection with any Loan Document, whether or not specifically mentioned herein
or therein.
"Madison" means Madison Dearborn Capital Partners III, L.P., a Delaware
limited partnership, Madison Dearborn Partners III, L.P., a Delaware limited
partnership, and any Person that the general partner of Madison Dearborn
Partners III, L.P. has the power to direct or cause the direction of the
management and policies thereof (whether by contract or otherwise).
"Managing Agents" means, as the context may require, the Administrative
Agent and/or the Syndication Agent.
"Material Adverse Effect" means a material adverse effect on (i) the
business, operations, results of operations, business prospects (which could
reasonably be expected to result in a Default) or financial condition of the
Borrower and its Subsidiaries taken as a whole, (ii) the rights and remedies of
any Secured Party under any Loan Document or (iii) the ability of any Obligor to
perform its Obligations under any Loan Document.
"Material Documents" means, collectively, the Recapitalization Agreement
(including any and all exhibits thereto), the Preferred Equity Documents
(including any and all exhibits thereto), the Consent Solicitation Statement,
and the Organic Documents of the Borrower and the Subsidiary Guarantors, in each
case as amended, supplemented, amended and restated or otherwise modified from
time to time in accordance with Section 7.2.12.
"MDCP" is defined in the first recital.
"Moody's" means Moody's Investors Service, Inc.
"Mortgage" means each mortgage, deed of trust or other agreement, in any
case in form and substance reasonably satisfactory to the Administrative Agent,
executed and delivered by any Obligor in favor of the Administrative Agent for
the benefit of the Secured Parties pursuant to the requirements of this
Agreement, under which a Lien is granted on the real property and fixtures
described therein, in each case as amended, supplemented, amended and restated
or otherwise modified from time to time.
"NAIC" means the National Association of Insurance Commissioners.
"Net Debt Proceeds" means with respect to the incurrence, sale or issuance
by the Borrower or any of its Subsidiaries of any Indebtedness (other than any
Indebtedness permitted by Section 7.2.2, as such Section may be amended or
modified with the consent of the Required Lenders), the excess of:
(a) the gross cash proceeds received by such Person from such
incurrence, sale or issuance,
over
(b) the sum of (i) all reasonable and customary underwriting
commissions and legal, investment banking, brokerage and accounting and
other professional fees, sales commissions and disbursements and all other
reasonable fees, expenses and charges, in each case actually incurred in
connection with such incurrence, sale or issuance and (ii) in the case of
any Indebtedness incurred, sold or issued by any Non-Guarantor that is a
Foreign Subsidiary, any taxes or other costs or expenses resulting from
repatriating any such proceeds to the United States.
"Net Disposition Proceeds" means, with respect to any Disposition of any
assets of the Borrower or any of its Subsidiaries permitted pursuant to clause
(d) of Section 7.2.11, the excess of
(a) the gross cash proceeds received by such Person from any such
Disposition and any cash payments when received in respect of promissory
notes or other non-cash consideration delivered to such Person in respect
thereof,
over
(b) the sum of (i) all reasonable and customary fees and expenses
with respect to legal, investment banking, brokerage and accounting and
other professional fees, sales commissions and disbursements and all other
reasonable fees, expenses and charges, in each case actually incurred in
connection with such Disposition, (ii) all Taxes and other governmental
costs and expenses actually paid or estimated by such Person (in good
faith) to be payable in cash in connection with such Disposition
(including, in the event of a Disposition of non-U.S. assets, any such
taxes or other costs or expenses resulting from repatriating any such
proceeds to the United States), (iii) payments made by such Person to
retire Indebtedness (other than the Credit Extensions) of such Person
where payment of such Indebtedness is required in connection with such
Disposition and (iv) reserves for purchase price adjustments, including
earn-out payments, and retained fixed liabilities that are payable by the
Borrower or such Subsidiary in cash to the extent required under GAAP in
connection with such Disposition;
provided, however, that if, after the payment of all Taxes, purchase price
adjustments, including earn-out payments, and retained fixed liabilities with
respect to such Disposition, the amount of estimated Taxes, purchase price
adjustments, including earn-out payments, and retained fixed liabilities, if
any, pursuant to clause (b)(ii) or (b)(iv) above exceeded the amount of Taxes,
purchase price adjustments, including earn-out payments, and retained fixed
liabilities amount actually paid in cash in respect of such Disposition, the
aggregate amount of such excess shall, at such time, constitute Net Disposition
Proceeds.
"Net Equity Proceeds" means with respect to the sale or issuance by the
Borrower to any Person of any Capital Securities of the Borrower, or any
warrants or options with respect to any such Capital Securities or the exercise
of any such warrants or options after the Closing Date (other than any sale or
issuance to, or exercise by, any directors, officers, employees or consultants
of the Borrower and its Subsidiaries), the excess of:
(a) the gross cash proceeds received by the Borrower from such sale,
exercise or issuance,
over
(b) all reasonable and customary underwriting commissions and legal,
investment banking, brokerage, accounting and other professional fees,
sales commissions and disbursements and all other reasonable fees,
expenses and charges, in each case actually incurred in connection with
such sale or issuance.
"Net Income" means, for any period, the aggregate of all amounts
(exclusive of (i) extraordinary gains and losses, (ii) gains and losses from
Dispositions, and (iii) non-cash restructuring charges, but including dividends
or distributions paid in cash by OSIFC to the Borrower) which would be included
as net income on the consolidated financial statements of the Borrower and its
Subsidiaries for such period; provided, however, that non-recurring expenses
associated with personnel and facility relocations, strategic reviews, branding
and Year 2000 compliance incurred during any of the four Fiscal Quarters ending
prior to the Closing Date shall be included in the determination of Net Income.
"Non-Domestic Secured Party" means any Secured Party that is not a "United
States person", as defined under Section 7701(a)(30) of the Code.
"Non-Excluded Taxes" means any Taxes other than net income and franchise
Taxes imposed with respect to any Secured Party by a Governmental Authority
under the laws of which such Secured Party is organized or in which it maintains
its applicable lending office or under the jurisdiction of which such Secured
Party maintains a fixed place of business or otherwise engages in business.
"Non-Guarantor" means Pay Tech, and each other Subsidiary of the Borrower
which is not a Subsidiary Guarantor.
"Note" means, as the context may require, a Revolving Note, a Term A Note,
a Term B Note or a Swing Line Note.
"Obligations" means all obligations (monetary or otherwise, whether
absolute or contingent, matured or unmatured) of each Obligor arising under or
in connection with a Loan Document, including the principal of and premium, if
any, and interest (including interest accruing during the pendency of any
proceeding of the type described in Section 8.1.9, whether or not allowed in
such proceeding) on the Loans and all Reimbursement Obligations.
"Obligor" means, as the context may require, the Borrower and each other
Person (other than (i) a Secured Party and (ii) any OSI Shareholder) obligated
under any Loan Document.
"Organic Document" means, relative to any Person, as applicable, its
certificate of incorporation, by-laws, certificate of partnership, partnership
agreement, certificate of formation, limited liability agreement and all
shareholder agreements, voting trusts and similar arrangements applicable to any
of such Person's partnership interests, limited liability company interests or
authorized shares of Capital Securities.
"OSI Common Stock" means the common stock of the Borrower, $0.01 par value
per share.
"OSI Shareholders" means MDCP and each other shareholder of the OSI Common
Stock who is obligated under the Shareholders' Pledge Agreement.
"OSIFC" means OSI Funding Corp., a Delaware corporation and a wholly owned
Subsidiary of the Borrower (which shall be converted to a non-Subsidiary limited
liability company after the Closing Date as contemplated in Section 7.4).
"OSIFC Family" and "OSIFC Family Member" means OSIFC and/or any Subsidiary
of OSIFC, either collectively or individually, as the context may require.
"OSIPS" means OSI Portfolio Services, Inc. (formerly known as Account
Portfolios, Inc.), a Delaware corporation and a wholly owned Subsidiary of the
Borrower.
"Other Person" is defined in the definition of "Subsidiary".
"Other Taxes" means any and all stamp, documentary or similar taxes, or
any other excise or property taxes or similar levies that arise on account of
any payment made or required to be made under any Loan Document or from the
execution, delivery, registration, recording or enforcement of any Loan
Document; provided, that the term "Other Taxes" shall not include any net income
or franchise taxes.
"Outstanding Amount" is defined in clause (c) of Section 2.3.2.
"Participant" is defined in Section 10.11.2.
"Patent Security Agreement" means any Patent Security Agreement executed
and delivered by any Obligor in substantially the form of Exhibit A to either
Pledge and Security Agreement, as amended, supplemented, amended and restated or
otherwise modified from time to time.
"Pay Tech" means Pay Tech, Inc., a Wisconsin corporation and a Subsidiary
of the Borrower.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in Section
3(2) of ERISA, which is subject to Title IV of ERISA (other than a multiemployer
plan as defined in Section 4001(a)(3) of ERISA), and to which the Borrower or
any corporation, trade or business that is, along with the Borrower, a member of
a Controlled Group, may have liability, including any liability by reason of
having been a substantial employer within the meaning of Section 4063 of ERISA
at any time during the preceding five years, or by reason of being deemed to be
a contributing sponsor under Section 4069 of ERISA.
"Percentage" means, as the context may require, any Lender's RL
Percentage, Term A Loan Percentage or Term B Loan Percentage.
"Perfection Certificate" means the Perfection Certificate executed and
delivered by an Authorized Officer of each Obligor that is a party to Pledge and
Security Agreement pursuant to Section 5.1.15 or 7.1.8, substantially in the
form of Exhibit H hereto, as amended, supplemented, amended and restated or
otherwise modified from time to time.
"Permitted Acquisition" means an acquisition of Capital Securities (by
merger, consolidation, purchase or otherwise) or of all or substantially all of
the assets by the Borrower or any Subsidiary (other than any OSIFC Family
Member) from any Person in which the following conditions are satisfied:
(a) immediately before and after giving effect to such acquisition
no Default shall have occurred and be continuing or would result therefrom
(including under Section 7.2.1);
(b) the Borrower shall have delivered to the Administrative Agent a
Compliance Certificate for the period of four full Fiscal Quarters
immediately preceding such acquisition (prepared in good faith and in a
manner and using such methodology which is consistent with the most recent
financial statements delivered pursuant to Section 7.1.1) giving pro forma
effect to the consummation of such acquisition and evidencing compliance
with the covenants set forth in Section 7.2.4;
(c) such acquisition, if an acquisition of Capital Securities, shall
result in the issuer of such Capital Securities becoming a wholly owned
Subsidiary; and
(d) upon the consummation of such acquisition, the provisions of
Section 7.1.8 are complied with.
"Permitted Lien" means any Lien described in Section 7.2.3.
"Permitted Portfolio Acquisition" is defined in clause (m) of Section
7.2.5.
"Permitted Receivables Amount" means (initially) $100,000,000, as such
amount may be cumulatively increased from time to time following the 2001 Fiscal
Year (in an aggregate amount not to exceed $55,000,000 over the term of this
Agreement) by the "Increased Amount" set forth below if the Leverage Ratio as of
the last day of any Fiscal Year is less than that set forth below (provided,
that, (i) once a particular Leverage Ratio has been achieved, the Permitted
Receivables Amount shall only be subsequently increased if at least the next
succeeding minimum Leverage Ratio (the "Next Ratio") is achieved in a subsequent
Fiscal Year and (ii) if, in any given Fiscal Year, the Leverage Ratio falls
below the next succeeding minimum Leverage Ratio below the Next Ratio, the
Permitted Receivables Amount will be cumulatively increased by the full amount
of the applicable Increased Amounts set forth below (i.e., if, at the end of
Fiscal Year 1, the Leverage Ratio is 2.80:1.00 and, thereafter, the Leverage
Ratio is 2.20:1.00 at the end of Fiscal Year 2, on and as of the appropriate
date, the Permitted Receivables Amount will be increased by $20,000,000)):
Leverage Ratio
Less Than Increased Amount
--------------- ----------------
3.25:1.00 $15,000,000
2.75:1.00 $10,000,000
2.25:1.00 $10,000,000
1.75:1.00 $10,000,000
1.25:1.00 $10,000,000
The Leverage Ratio used to compute the Increased Amount shall be that set forth
in the Compliance Certificate delivered by the Borrower to the Administrative
Agent for the fourth Fiscal Quarter of each Fiscal Year (beginning with the
fourth Fiscal Quarter of the 2001 Fiscal Year); provided, that the Increased
Amount shall only become effective from and subsequent to the date such
Compliance Certificate is actually delivered and only if such Compliance
Certificate also demonstrates that (i) no Default shall have occurred and be
continuing and (ii) the Borrower was in compliance with the covenants set forth
in Section 7.2.4 during the fourth Fiscal Quarter of the Fiscal Year in respect
of which such Compliance Certificate is delivered.
"Permitted Receivables Transaction" means any transaction (including any
Alternative Receivables Program), providing for the sale or financing of
Accounts with customary limited recourse based on the collectability of the
Accounts sold, consummated pursuant to and in accordance with the Receivables
Documents.
"Permitted Refinancing" means, as to any Indebtedness (other than the
Obligations), the incurrence of other Indebtedness (whether with the same or
different lenders) to refinance such existing Indebtedness or the amendment,
renewal or other modification of such existing Indebtedness; provided that, in
the case of such other Indebtedness or modified Indebtedness, the following
conditions are satisfied:
(i) the weighted average life to maturity of such refinancing or
modified Indebtedness shall be greater than or equal to the weighted
average life to maturity of the Indebtedness being refinanced or modified,
and the first scheduled principal payment in respect of such refinancing
or modified Indebtedness shall not be earlier than the first scheduled
principal payment in respect of the Indebtedness being refinanced or
modified;
(ii) the principal amount of such refinancing or modified
Indebtedness shall be less than or equal to the principal amount then
outstanding of the Indebtedness being refinanced or modified;
(iii) the respective obligor or obligors shall be the same on
the refinancing or modified Indebtedness as on the Indebtedness being
refinanced or modified;
(iv) the security, if any, for the refinancing or modified
Indebtedness shall be the same as that for the Indebtedness being
refinanced or modified (except to the extent that less security is granted
to holders of the refinancing Indebtedness or modified Indebtedness);
(v) the refinancing or modified Indebtedness is subordinated to the
Obligations to the same degree, if any, or to a greater degree as the
Indebtedness being refinanced or modified; and
(vi) with respect to any refinancing or modification of the
Indebtedness evidenced by the Subordinated Notes, no material terms
applicable to such refinancing or modified Indebtedness and, if
applicable, the related guarantees of such refinancing or modified
Indebtedness (including covenants, events of default, acceleration rights
and remedies) shall be more favorable to the lenders with respect to such
refinancing or modified Indebtedness than the terms that are applicable
under the instruments and documents governing the Indebtedness being
refinanced or modified.
"Person" means any natural person, corporation, limited liability company,
partnership, joint venture, association, trust or unincorporated organization,
Governmental Authority or any other legal entity, whether acting in an
individual, fiduciary or other capacity.
"PIK Preferred Equity" is defined in clause (b) of the fourth recital.
"PIK Preferred Equity Documents" is defined in clause (b) of the fourth
recital.
"PIK Preferred Equity Holders" is defined in clause (b) of the fourth
recital.
"PIK Preferred Equity Issuance" is defined in clause (b) of the fourth
recital.
"Pledge Agreement" means, as the context may require, the Shareholders'
Pledge Agreement, the Borrower Pledge and Security Agreement and/or the
Subsidiary Pledge and Security Agreement.
"Pledge and Security Agreement" means, as the context may require, the
Borrower Pledge and Security Agreement and/or the Subsidiary Pledge and Security
Agreement.
"Pledged Subsidiary" means each Subsidiary in respect of which the
Administrative Agent has been granted a security interest in or a pledge of (i)
any of the Capital Securities of such Subsidiary or (ii) any Intercompany Notes
of such Subsidiary owing to the Borrower or another Subsidiary.
"Preferred Equity" is defined in clause (c) of the fourth recital.
"Preferred Equity Documents" is defined in clause (c) of the fourth
recital.
"Preferred Equity Holders" is defined in clause (c) of the fourth recital.
"Preferred Equity Issuance" is defined in clause (c) of the fourth
recital.
"Prime Rate" means the rate of interest per annum publicly announced from
time to time by Fleet National Bank, as its prime rate in effect at its
principal office in Boston, Massachusetts; each change in the Prime Rate shall
be effective from and including the date such change is publicly announced as
being effective.
"Public Market" shall exist if (i) a Public Offering has been consummated
and (ii) any Capital Securities of the Borrower has been distributed by means of
an effective registration statement under the Securities Act.
"Public Offering" means a public offering of Capital Securities of the
Borrower pursuant to an effective registration statement under the Securities
Act.
"Quarterly Payment Date" means the 15th day of January, April, July and
October, or, if any such day is not a Business Day, the next succeeding Business
Day.
"Rate Protection Agreement" means, collectively, any interest rate swap,
cap, collar or similar agreement entered into by the Borrower or any of its
Subsidiaries under which the counterparty of such agreement is (or at the time
such agreement was entered into, was) a Lender or an Affiliate of a Lender.
"Recapitalization" is defined in the first recital.
"Recapitalization Agreement" is defined in the first recital.
"Receivables Agreement" means that certain Sale and Servicing Agreement,
dated as of October 28, 1998, by and among the Borrower, Gulf State Credit,
L.L.C., OSIFC and OSIPS, as in effect on the Closing Date.
"Receivables Documents" means the Receivables Agreement, the Triple-A One
Credit Agreement, the Triple-A One Commercial Paper, and the Variable Funding
Notes, in each case as amended, supplemented, amended and restated or otherwise
modified from time to time in accordance with Section 7.2.12.
"Receivables Facility Outstandings" means, at any date of determination,
the principal amount of commercial paper issued and outstanding under the
Triple-A One Credit Agreement and pursuant to the Permitted Receivables
Transaction.
"Refinancing" is defined in the second recital.
"Refunded Swing Line Loans" is defined in clause (b) of Section 2.3.2.
"Register" is defined in clause (b)(i) of Section 2.7.
"Reimbursement Obligation" is defined in Section 2.6.3.
"Related Fund" means, with respect to any Lender that is a fund that
invests in commercial loans, any other fund that invests in commercial loans and
is managed or advised by the same investment advisor as such Lender or by an
Affiliate of such investment advisor.
"Release" means a "release", as such term is defined in CERCLA.
"Replacement Lender" is defined in Section 4.11.
"Replacement Notice" is defined in Section 4.11.
"Repurchase Payments" means amounts expended to repurchase, redeem, or
otherwise retire for value any shares of the Borrower's Capital Securities
(together with options or warrants in respect of any thereof) held by officers,
directors, employees and individual persons who are consultants of the Borrower
(or any of their respective estates or beneficiaries under such estates).
"Required Lenders" means, at any time, Lenders holding at least 51% of the
Total Exposure Amount.
"Resource Conservation and Recovery Act" means the Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901, et seq., as amended.
"Restricted Cash Balance" means, as of the last day of any Fiscal Quarter,
the aggregate amount of all cash, deposits and Cash Equivalent Investments which
is not owned by the Borrower or any of its Subsidiaries but instead is being
held by the Borrower or any such Subsidiary for the benefit of any of their
respective customers which are not included as "cash and cash equivalents" on
the consolidated balance sheet of the Borrower and its Subsidiaries.
"Restricted Payment" means the declaration or payment of any dividend
(other than dividends to be paid or in fact paid in Capital Securities of the
Borrower or any Subsidiary or by an increase in the liquidation preference of
any Capital Securities of the Borrower or any Subsidiary) on, or the making of
any payment or distribution on account of, or setting apart assets for a sinking
or other analogous fund for, the purchase, redemption, defeasance, retirement or
other acquisition of any class of Capital Securities of the Borrower or any
Subsidiary or any warrants or options to purchase any such Capital Securities,
whether now or hereafter outstanding, or the making of any other payment or
distribution (other than in Capital Securities or by an increase in the
liquidation preference of any Capital Securities of the Borrower or any
Subsidiary) in respect thereof, either directly or indirectly, whether in cash
or property, obligations of the Borrower or any Subsidiary or otherwise.
"Revolving Loan" is defined in Section 2.1.1.
"Revolving Loan Commitment" means, relative to any Lender, such Lender's
obligation (if any) to make Revolving Loans pursuant to Section 2.1.1.
"Revolving Loan Commitment Amount" means, on any date, $75,000,000, as
such amount may be reduced from time to time pursuant to Section 2.2.
"Revolving Loan Commitment Termination Date" means the earliest of
(a) December 10, 2005;
(b) the date on which the Revolving Loan Commitment Amount is
terminated in full or reduced to zero pursuant to the terms of this
Agreement; and
(c) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described in the preceding clause (b) or (c),
the Revolving Loan Commitments shall terminate automatically and without any
further action.
"Revolving Loan Lender" is defined in Section 2.1.1.
"Revolving Note" means a promissory note of the Borrower payable to any
Revolving Loan Lender, in the form of Exhibit A-1 hereto (as such promissory
note may be amended, endorsed or otherwise modified from time to time),
evidencing the aggregate Indebtedness of the Borrower to such Revolving Loan
Lender resulting from outstanding Revolving Loans, and also means all other
promissory notes accepted from time to time in substitution therefor or renewal
thereof.
"RL Percentage" means, relative to any Lender, the applicable percentage
relating to Revolving Loans set forth on Schedule II hereto under the Revolving
Loan Commitment column or set forth in a Lender Assignment Agreement under the
Revolving Loan Commitment column, as such percentage may be adjusted from time
to time pursuant to Lender Assignment Agreements executed by such Lender and its
Assignee Lender and delivered pursuant to Section 10.11.1. A Lender shall not
have any Revolving Loan Commitment if its percentage under the Revolving Loan
Commitment column is zero.
"Rollover Shareholders" is defined in clause (ii) of the first recital.
"S&P" means Standard & Poor's Rating Services, a division of McGraw-Hill,
Inc.
"SEC" means the Securities and Exchange Commission.
"Secured Parties" means, collectively, the Lenders, the Issuers, the
Managing Agents, each counterparty to a Rate Protection Agreement that is (or at
the time such Rate Protection Agreement was entered into, was) a Lender or an
Affiliate thereof and (in each case), each of their respective successors,
transferees and assigns.
"Securities Act" means the Securities Act of 1933, as amended.
"Shareholders' Pledge Agreement" means the Pledge Agreement executed and
delivered by each of the OSI Shareholders, substantially in the form of Exhibit
G-1 hereto, as amended, supplemented, amended and restated or otherwise modified
from time to time.
"Solicitation" is defined in the third recital.
"Solvent" means, with respect to any Person and its Subsidiaries on a
particular date, that on such date (a) the fair value of the property of such
Person and its Subsidiaries on a consolidated basis is greater than the total
amount of liabilities, including contingent liabilities, of such Person and its
Subsidiaries on a consolidated basis, (b) the present fair salable value of the
assets of such Person and its Subsidiaries on a consolidated basis is not less
than the amount that will be required to pay the probable liability of such
Person and its Subsidiaries on a consolidated basis on its debts as they become
absolute and matured, (c) such Person does not intend to, and does not believe
that it or its Subsidiaries will, incur debts or liabilities beyond the ability
of such Person and its Subsidiaries to pay as such debts and liabilities mature,
and (d) such Person and its Subsidiaries on a consolidated basis is not engaged
in business or a transaction, and such Person and its Subsidiaries on a
consolidated basis is not about to engage in business or a transaction, for
which the property of such Person and its Subsidiaries on a consolidated basis
would constitute an unreasonably small capital. The amount of Contingent
Liabilities at any time shall be computed as the amount that, in light of all
the facts and circumstances existing at such time, can reasonably be expected to
become an actual or matured liability, including as an asset all Contingent
Liabilities and indemnifications provided by a third party in favor of such
Person and its Subsidiaries.
"Specified Liabilities" means liabilities of the Borrower or any of its
Subsidiaries arising from agreements delivered after the Closing Date in
connection with acquisitions or dispositions of any business, assets or
Subsidiary of the Borrower or any of its Subsidiaries in respect of
indemnification, adjustment of purchase price (including earn-out arrangements),
similar obligations or from guarantees or letters of credit, surety bonds or
performance bonds securing the performance of the Borrower or any such
Subsidiary pursuant to such agreements.
"Stated Amount" means, on any date and with respect to a particular Letter
of Credit, the total amount then available to be drawn under such Letter of
Credit.
"Stated Expiry Date" is defined in Section 2.6.
"Stated Maturity Date" means
(a) with respect to all Term A Loans, December 10, 2005;
(b) with respect to all Term B Loans, June 10, 2006; and
(c) with respect to all Revolving Loans and Swing Line Loans,
December 10, 2005.
"Statutory Reserve Rate" means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
of one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject with
respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred
to as "Eurocurrency Liabilities" in Regulation D of the Board). Such reserve
percentages shall include those imposed pursuant to such Regulation D. LIBO Rate
Loans shall be deemed to constitute eurocurrency funding and to be subject to
such reserve requirements without benefit of or credit for proration, exemptions
or offsets that may be available from time to time to any Lender under such
Regulation D or any comparable regulation. The Statutory Reserve Rate shall be
adjusted automatically on and as of the effective date of any change in any
reserve percentage.
"Student Loan Collection Business" means billing, portfolio management,
default aversion and debt collection services for the purpose of collecting
loans issued or guaranteed under a student financial assistance program.
"Subordinated Debt" means unsecured Indebtedness of each Obligor
(including the Indebtedness evidenced by the Subordinated Notes) subordinated in
right of payment to the Obligations pursuant to documentation containing
redemption and other prepayment events, maturities, amortization schedules,
covenants, events of default, remedies, acceleration rights, subordination
provisions and other material terms satisfactory to the Required Lenders.
"Subordinated Debt Documents" means, collectively, the Subordinated Note
Indenture and each of the loan agreements, indentures, note purchase agreements,
promissory notes, guarantees, and other instruments (including the Subordinated
Notes) and agreements evidencing the terms of Subordinated Debt, as amended,
supplemented, waived, amended and restated or otherwise modified in accordance
with Section 7.2.12.
"Subordinated Note Holders" is defined in the third recital.
"Subordinated Note Indenture" means the Indenture, dated November 6, 1996,
between the Borrower, the guarantors signatory thereto, and Wilmington Trust
Company, as trustee, as in effect on the Closing Date and, thereafter, as
amended, supplemented, amended and restated or otherwise modified in accordance
with Section 7.2.12, and any refinancings or replacements thereof.
"Subordinated Notes" means the Borrower's 11% senior subordinated notes
due 2006, as in effect on the Closing Date and, thereafter, as amended,
supplemented, amended and restated or otherwise modified in accordance with
Section 7.2.12.
"Subordination Provisions" is defined in Section 8.1.11.
"Subsidiary" means, with respect to any Person, any corporation, limited
liability company, partnership or other entity ("Other Person") of which more
than 50% of the Voting Securities of such Other Person (irrespective of whether
at the time Capital Securities of any other class or classes of such Other
Person shall or might have voting power upon the occurrence of any contingency)
is at the time directly or indirectly owned or controlled by such Person, by
such Person and one or more other Subsidiaries of such Person, or by one or more
other Subsidiaries of such Person.
"Subsidiary Guarantor" means each Domestic Subsidiary that has executed
and delivered to the Administrative Agent the Subsidiary Guaranty (or a
supplement thereto) pursuant to the terms of this Agreement.
"Subsidiary Guaranty" means the subsidiary guaranty executed and delivered
by each Subsidiary Guarantor pursuant to the terms of this Agreement,
substantially in the form of Exhibit F hereto, as amended, supplemented, amended
and restated or otherwise modified from time to time.
"Subsidiary Pledge and Security Agreement" means the Pledge and Security
Agreement executed and delivered by an Authorized Officer of each Subsidiary,
substantially in the form of Exhibit G-3 hereto, together with any supplemental
Foreign Pledge Agreements delivered from time to time pursuant to the terms of
the Pledge and Security Agreement, in each case as amended, supplemented,
amended and restated or otherwise modified from time to time.
"Summary" is defined in clause (a) of Section 7.1.13.
"Swing Line Lender" means the Administrative Agent, in its capacity as the
Swing Line Lender.
"Swing Line Loan" is defined in clause (b) of Section 2.1.1.
"Swing Line Loan Commitment" is defined in clause (b) of Section 2.1.1.
"Swing Line Loan Commitment Amount" means, on any date, $7,500,000, as
such amount may be reduced from time to time pursuant to Section 2.2.
"Swing Line Note" means a promissory note of the Borrower payable to the
Swing Line Lender, in the form of Exhibit A-4 hereto (as such promissory note
may be amended, endorsed or otherwise modified from time to time), evidencing
the aggregate Indebtedness of the Borrower to the Swing Line Lender resulting
from outstanding Swing Line Loans, and also means all other promissory notes
accepted from time to time in substitution therefor or renewal thereof.
"Syndication Agent" is defined in the preamble.
"Taxes" means any and all income, stamp or other taxes, duties, levies,
imposts, charges, assessments, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority, and all interest, penalties or similar liabilities with respect
thereto.
"Term A Loan" is defined in Section 2.1.3.
"Term A Loan Commitment" means, relative to any Lender, such Lender's
obligation (if any) to make Term A Loans pursuant to Section 2.1.3.
"Term A Loan Commitment Amount" means, on any date, $150,000,000.
"Term A Loan Commitment Termination Date" means the earlier of (a) the
Closing Date (immediately after the making of the Term A Loans on such date) and
(b) the date on which any Commitment Termination Event occurs. Upon the
occurrence of any event described in clause (a) or (b), the Term A Loan
Commitments shall terminate automatically and without any further action.
"Term A Note" means a promissory note of the Borrower payable to any
Lender, in the form of Exhibit A-2 hereto (as such promissory note may be
amended, endorsed or otherwise modified from time to time), evidencing the
aggregate Indebtedness of the Borrower to such Lender resulting from outstanding
Term A Loans, and also means all other promissory notes accepted from time to
time in substitution therefor or renewal thereof.
"Term A Loan Percentage" means, relative to any Lender, the applicable
percentage relating to Term A Loans set forth on Schedule II hereto under the
Term A Loan Commitment column or set forth in a Lender Assignment Agreement
under the Term A Loan Commitment column, as such percentage may be adjusted from
time to time pursuant to Lender Assignment Agreements executed by such Lender
and its Assignee Lender and delivered pursuant to Section 10.11.1. A Lender
shall not have any Term A Loan Commitment if its percentage under the Term A
Loan Commitment column is zero.
"Term B Loan" is defined in Section 2.1.4.
"Term B Loan Commitment" means, relative to any Lender, such Lender's
obligation (if any) to make Term B Loans pursuant to Section 2.1.4.
"Term B Loan Commitment Amount" means, on any date, $250,000,000.
"Term B Loan Commitment Termination Date" means the earlier of (a) the
Closing Date (immediately after the making of the Term B Loans on such date); or
(b) the date on which any Commitment Termination Event occurs. Upon the
occurrence of any event described in clause (a) or (b), the Term B Loan
Commitments shall terminate automatically and without any further action.
"Term B Note" means a promissory note of the Borrower payable to any
Lender, in the form of Exhibit A-3 hereto (as such promissory note may be
amended, endorsed or otherwise modified from time to time), evidencing the
aggregate Indebtedness of the Borrower to such Lender resulting from outstanding
Term B Loans, and also means all other promissory notes accepted from time to
time in substitution therefor or renewal thereof.
"Term B Loan Percentage" means, relative to any Lender, the applicable
percentage relating to Term B Loans set forth on Schedule II hereto under the
Term B Loan Commitment column or set forth in a Lender Assignment Agreement
under the Term B Loan Commitment column, as such percentage may be adjusted from
time to time pursuant to Lender Assignment Agreements executed by such Lender
and its Assignee Lender and delivered pursuant to Section 10.11.1. A Lender
shall not have any Term B Loan Commitment if its percentage under the Term B
Loan Commitment column is zero.
"Term Loans" means, collectively, the Term A Loans and the Term B Loans.
"Termination Date" means the date on which all Obligations have been paid
in full (other than indemnity obligations not yet due and payable) in cash, all
Letters of Credit have been terminated, expired or Cash Collateralized, all Rate
Protection Agreements have been terminated and all Commitments shall have
terminated.
"Total Debt" means, on any date, the outstanding principal amount of all
Indebtedness of the Borrower and its Subsidiaries of the type referred to in
clauses (a), (b) and (c), in each case, of the definition of "Indebtedness" and,
without duplication, any Contingent Liability in respect of any of the
foregoing.
"Total Exposure Amount" means, on any date of determination (and without
duplication), the outstanding principal amount of all Loans, the aggregate
amount of all Letter of Credit Outstandings and the unfunded amount of the
Commitments.
"Trademark Security Agreement" means any Trademark Security Agreement
executed and delivered by any Obligor substantially in the form of Exhibit B to
either Pledge and Security Agreement, as amended, supplemented, amended and
restated or otherwise modified from time to time.
"Tranche" means, as the context may require, the Term A Loans, the Term B
Loans or the Revolving Loans.
"Transaction" is defined in the fourth recital.
"Transaction Documents" means each of the Material Documents and all other
agreements, documents, instruments, certificates, filings, consents, approvals,
board of directors resolutions and opinions furnished pursuant to or in
connection with the Recapitalization, the Refinancing, the Preferred Equity
Issuances, the Solicitation, and the other transactions contemplated hereby or
thereby, in each case as amended, supplemented, amended and restated or
otherwise modified from time to time in accordance with Section 7.2.12.
"Triple-A One" means Triple-A One Funding Corp., a Delaware corporation.
"Triple-A Commercial Paper" means commercial paper issued by Triple-A One
to fund advances made by Triple-A One to OSIFC evidenced by the Variable Funding
Notes.
"Triple-A One Credit Agreement" means the Triple-A One Credit Agreement,
dated as of October 28, 1998, among OSIFC, Triple-A One, and MBIA Insurance
Corporation, as in effect on the Closing Date.
"type" means, relative to any Loan, the portion thereof, if any, being
maintained as a Base Rate Loan or a LIBO Rate Loan.
"UAS" means University Accounting Service, Inc., a Wisconsin corporation,
as such corporation's name may be changed from time to time.
"UCC" means the Uniform Commercial Code as in effect from time to time in
the State of New York; provided, that if, with respect to any Filing Statement
or by reason of any provisions of law, the perfection or the effect of
perfection or non-perfection of the security interests granted to the
Administrative Agent pursuant to the applicable Loan Document is governed by the
Uniform Commercial Code as in effect in a jurisdiction of the United States
other than New York, UCC means the Uniform Commercial Code as in effect from
time to time in such other jurisdiction for purposes of the provisions of each
Loan Document and any Filing Statement relating to such perfection or effect of
perfection or non-perfection.
"United States" or "U.S." means the United States of America, its fifty
states and the District of Columbia.
"Variable Funding Notes" means, collectively, the variable funding notes
or certificates issued by OSIFC to Triple-A One to finance the purchase of
receivables by OSIFC pursuant to the Triple-A One Credit Agreement, as in effect
on the Closing Date.
"Voting Securities" means, with respect to any Person, Capital Securities
of any class or kind ordinarily having the power to vote (that is, not
contingent on the happening of any event) for the election of directors,
managers or other voting members of the governing body of such Person.
"Welfare Plan" means a "welfare plan", as such term is defined in Section
3(1) of ERISA.
"wholly owned" refers to any Subsidiary all of the outstanding common
stock (or similar equity interest) of which (other than any director's
qualifying shares or investments by foreign nationals mandated by applicable
laws) is owned directly or indirectly by the Borrower.
SECTION 1.2. Use of Defined Terms. Unless otherwise defined or the context
otherwise requires, terms for which meanings are provided in this Agreement
shall have such meanings when used in each other Loan Document and the
Disclosure Schedule, and each notice and other communication delivered from time
to time in connection with any Loan Document.
SECTION 1.3. Cross-References. Unless otherwise specified, references in a
Loan Document to any Article or Section are references to such Article or
Section of such Loan Document, and references in any Article, Section or
definition to any clause are references to such clause of such Article, Section
or definition.
SECTION 1.4. Accounting and Financial Determinations; etc. (a) Unless
otherwise specified, all accounting terms used in each Loan Document shall be
interpreted, and all accounting determinations and computations thereunder
(including under Section 7.2.4 and the definitions used in such calculations)
shall be made, in accordance with those generally accepted accounting principles
("GAAP") applied in the preparation of the financial statements referred to in
clause (a) of Section 5.1.8. Unless otherwise expressly provided, all financial
covenants and defined financial terms shall be computed on a consolidated basis
for the Borrower and its Subsidiaries (other than the OSIFC Family), in each
case without duplication.
(b) For purposes of computing the Leverage Ratio, the Interest Coverage
Ratio and the Fixed Charge Coverage Ratio, such ratios (and any financial
calculations or components required to be made or included therein) shall be
determined, with respect to the relevant period, after giving pro forma effect
to each acquisition and Disposition of a Person, business or asset consummated
during such period, together with all transactions relating thereto consummated
during such period (including any incurrence, assumption, refinancing or
repayment of Indebtedness), as if such acquisition, Disposition and related
transactions had been consummated on the first day of such period, in each case
based on historical actual results accounted for in accordance with GAAP. In
furtherance of, and not in limitation of, the preceding sentence, any
determination to be made in accordance with this clause for any period
commencing prior to the Closing Date shall give pro forma effect to the
Transaction as provided in the preceding sentence.
ARTICLE II
COMMITMENTS, BORROWING AND ISSUANCE
PROCEDURES, NOTES AND LETTERS OF CREDIT
SECTION 2.1. Commitments. On the terms and subject to the conditions of
this Agreement, the Lenders and the Issuers severally agree to make Credit
Extensions as set forth below.
SECTION 2.1.1. Revolving Loan Commitment and Swing Line Loan Commitment.
From time to time on any Business Day occurring from and after the Closing Date
but prior to the Revolving Loan Commitment Termination Date,
(a) each Lender that has a Revolving Loan Commitment (referred to as
a "Revolving Loan Lender") agrees that it will make loans (relative to
such Lender, its "Revolving Loans") to the Borrower equal to such Lender's
RL Percentage of the aggregate amount of each Borrowing of the Revolving
Loans requested by the Borrower to be made on such day; and
(bi the Swing Line Lender agrees that it will make loans (its "Swing
Line Loans") to the Borrower equal to the principal amount of the Swing
Line Loan requested by the Borrower to be made on such day. The Commitment
of the Swing Line Lender described in this clause is herein referred to as
its "Swing Line Loan Commitment".
On the terms and subject to the conditions hereof, the Borrower may from time to
time borrow, prepay and reborrow Revolving Loans and Swing Line Loans. No
Revolving Loan Lender shall be permitted or required to make any Revolving Loan
if, after giving effect thereto, the aggregate outstanding principal amount of
all Revolving Loans of such Revolving Loan Lender, together with such Lender's
RL Percentage of the aggregate amount of all Swing Line Loans and Letter of
Credit Outstandings, would exceed such Lender's RL Percentage of the then
existing Revolving Loan Commitment Amount. Furthermore, the Swing Line Lender
shall not be permitted or required to make Swing Line Loans if, after giving
effect thereto, (i) the aggregate outstanding principal amount of all Swing Line
Loans would exceed the then existing Swing Line Loan Commitment Amount or (ii)
unless otherwise agreed to by the Swing Line Lender, in its sole discretion, the
sum of all Swing Line Loans and Revolving Loans made by the Swing Line Lender
plus the Swing Line Lender's RL Percentage of the aggregate amount of Letter of
Credit Outstandings would exceed the Swing Line Lender's RL Percentage of the
then existing Revolving Loan Commitment Amount.
SECTION 2.1.2. Letter of Credit Commitment. Each of the parties hereto
acknowledge and agree that all Existing Letters of Credit shall continue as
Letters of Credit for all purposes under the Loan Documents. In addition, from
time to time on any Business Day occurring from and after the Closing Date but
prior to the Revolving Loan Commitment Termination Date, each Issuer agrees that
it will, to the extent requested by the Borrower,
(a) issue one or more Letters of Credit in the Stated Amount
requested by the Borrower on such day; or
(b) extend the Stated Expiry Date of an existing standby Letter of
Credit previously issued hereunder.
No Stated Expiry Date shall be scheduled to occur beyond the earlier of (i) the
Revolving Loan Commitment Termination Date and (ii) unless otherwise agreed to
by the applicable Issuer in its sole discretion, one year from the date of such
issuance or extension. No Issuer shall be permitted or required to issue any
Letter of Credit if, after giving effect thereto, (i) the aggregate amount of
all Letter of Credit Outstandings would exceed the Letter of Credit Commitment
Amount or (ii) the sum of the aggregate amount of all Letter of Credit
Outstandings plus the aggregate principal amount of all Revolving Loans and
Swing Line Loans then outstanding would exceed the Revolving Loan Commitment
Amount.
SECTION 2.1.3. Term A Loan Commitment. In a single Borrowing on any
Business Day occurring on or prior to the Term A Loan Commitment Termination
Date, each Lender that has a Term A Loan Commitment agrees that it will make
loans (relative to such Lender, its "Term A Loans") to the Borrower equal to
such Lender's Term A Loan Percentage of the aggregate amount of the Borrowing of
Term A Loans requested by the Borrower to be made on such day. No amounts paid
or prepaid with respect to Term A Loans may be reborrowed.
SECTION 2.1.4. Term B Loan Commitment. In a single Borrowing on any
Business Day occurring on or prior to the Term B Loan Commitment Termination
Date, each Lender that has a Term B Loan Commitment agrees that it will make
loans (relative to such Lender, its "Term B Loans") to the Borrower equal to
such Lender's Term B Loan Percentage of the aggregate amount of the Borrowing of
Term B Loans requested by the Borrower to be made on such day. No amounts paid
or prepaid with respect to Term B Loans may be reborrowed.
SECTION 2.2. Reduction of the Commitment Amounts. The Commitment
Amounts are subject to reduction from time to time pursuant to this Section.
SECTION 2.2.1. Optional. The Borrower may, from time to time on any
Business Day occurring on and after the Closing Date, voluntarily reduce the
amount of the Revolving Loan Commitment Amount, the Swing Line Loan Commitment
Amount or the Letter of Credit Commitment Amount on the Business Day so
specified by the Borrower; provided, however, that all such reductions shall
require at least three Business Day's prior notice to the Administrative Agent
and be permanent, and any partial reduction of any Commitment Amount shall be in
a minimum amount of $500,000 and in an integral multiple of $100,000. Any
optional or mandatory reduction of the Revolving Loan Commitment Amount pursuant
to the terms of this Agreement which reduces the Revolving Loan Commitment
Amount below the sum of (i) the Swing Line Loan Commitment Amount and (ii) the
Letter of Credit Commitment Amount shall result in an automatic and
corresponding reduction of the Swing Line Loan Commitment Amount and/or Letter
of Credit Commitment Amount (as directed by the Borrower in a notice to the
Administrative Agent delivered together with the notice of such voluntary
reduction in the Revolving Loan Commitment Amount) to an aggregate amount not in
excess of the Revolving Loan Commitment Amount, as so reduced, without any
further action on the part of the Swing Line Lender or any Issuer.
SECTION 2.2.2. Mandatory. Following the prepayment in full of the Term
Loans, the Revolving Loan Commitment Amount shall, without any further action,
automatically and permanently be reduced on the date the Term Loans would
otherwise have been required to be prepaid pursuant to clause (e), (f), (g) or
(h) of Section 3.1.1, in an amount equal to the amount by which the Term Loans
would otherwise be required to be prepaid if Term Loans had been outstanding.
SECTION 2.3. Borrowing Procedures. Loans (other than Swing Line Loans)
shall be made by the Lenders in accordance with Section 2.3.1, and Swing Line
Loans shall be made by the Swing Line Lender in accordance with Section 2.3.2.
SECTION 2.3.1. Borrowing Procedure. In the case of other than Swing Line
Loans, by delivering a Borrowing Request to the Administrative Agent on or
before 12:00 p.m. (noon) on a Business Day, the Borrower may from time to time
irrevocably request, on not less than one Business Day's notice in the case of
Base Rate Loans, or three Business Days' notice in the case of LIBO Rate Loans,
and in either case not more than ten Business Days' notice, that a Borrowing be
made, in the case of LIBO Rate Loans, in a minimum amount of $2,000,000 and an
integral multiple of $500,000, in the case of Base Rate Loans, in a minimum
amount of $500,000 and an integral multiple of $100,000 or, in either case, in
the unused amount of the applicable Commitment; provided, however, that all of
the initial Loans shall be made as Base Rate Loans. On the terms and subject to
the conditions of this Agreement, each Borrowing shall be comprised of the type
of Loans, and shall be made on the Business Day, specified in such Borrowing
Request. In the case of other than Swing Line Loans, on or before 1:00 p.m. on
such Business Day each Lender that has a Commitment to make the Loans being
requested shall deposit with the Administrative Agent same day funds in an
amount equal to such Lender's Percentage of the requested Borrowing. Such
deposit will be made to an account which the Administrative Agent shall specify
from time to time by notice to the Lenders. To the extent funds are received
from the Lenders, the Administrative Agent shall make such funds available to
the Borrower by wire transfer to the accounts the Borrower shall have specified
in its Borrowing Request. No Lender's obligation to make any Loan shall be
affected by any other Lender's failure to make any Loan.
SECTION 2.3.2. Swing Line Loans. (a) By telephonic notice to the Swing
Line Lender on or before 12:00 noon on any Business Day (followed (within one
Business Day) by the delivery of a confirming Borrowing Request) occurring on
and after the Closing Date through (but excluding) the Revolving Loan Commitment
Termination Date, the Borrower may from time to time irrevocably request that
Swing Line Loans be made by the Swing Line Lender in an aggregate minimum
principal amount of $250,000 and an integral multiple of $50,000; provided, that
the aggregate principal amount of Swing Line Loans shall at no time exceed the
Swing Line Loan Commitment Amount. Subject to Section 5.2, all Swing Line Loans
shall be made as Base Rate Loans and shall not be entitled to be converted into
LIBO Rate Loans. The proceeds of each Swing Line Loan shall be made available by
the Swing Line Lender to the Borrower by wire transfer to the account the
Borrower shall have specified in its notice therefor by the close of business on
the Business Day telephonic notice is received by the Swing Line Lender.
(b) Each Revolving Loan Lender (other than the Swing Line Lender)
irrevocably agrees that it will, at the request of the Swing Line Lender in its
sole and absolute discretion at any time, make a Revolving Loan (which shall
initially be funded as a Base Rate Loan) in an amount equal to such Lender's RL
Percentage of the aggregate principal amount of all such Swing Line Loans then
outstanding (such outstanding Swing Line Loans hereinafter referred to as the
"Refunded Swing Line Loans"); provided, that if any Default described in clauses
(a) through (d) of Section 8.1.9 shall have occurred and be continuing, the
procedures set forth in the last two sentences of this clause shall apply and no
other provisions of this clause shall be applicable. On or before 11:00 a.m. on
the first Business Day following receipt by each Revolving Loan Lender of a
request to make Revolving Loans as provided in the preceding sentence, each
Revolving Loan Lender shall deposit in an account specified by the Swing Line
Lender the amount so requested in same day funds and such funds shall be applied
by the Swing Line Lender to repay the Refunded Swing Line Loans. At the time the
Revolving Loan Lenders make the above referenced Revolving Loans the Swing Line
Lender shall be deemed to have made, in consideration of the making of the
Refunded Swing Line Loans, Revolving Loans in an amount equal to the Swing Line
Lender's RL Percentage of the aggregate principal amount of the Refunded Swing
Line Loans. Upon the making (or deemed making, in the case of the Swing Line
Lender) of any Revolving Loans pursuant to this clause, the amount so funded
shall become outstanding under such Revolving Loan Lender's Revolving Note and
shall no longer be owed under the Swing Line Note. All interest payable with
respect to any Revolving Loans made (or deemed made, in the case of the Swing
Line Lender) pursuant to this clause shall be appropriately adjusted to reflect
the period of time during which the Swing Line Lender had outstanding Swing Line
Loans in respect of which such Revolving Loans were made. Each Revolving Loan
Lender's obligation to make the Revolving Loans referred to in this clause shall
be absolute and unconditional and shall not be affected by any circumstance,
including (i) any set-off, counterclaim, recoupment, defense or other right
which such Lender may have against the Swing Line Lender, any Obligor or any
Person for any reason whatsoever; (ii) the occurrence or continuance of any
Default (other than a Default which the Swing Line Lender is deemed to have
notice of pursuant to clause (b) of Section 9.3); (iii) any adverse change in
the condition (financial or otherwise) of any Obligor; (iv) the acceleration or
maturity of any Obligations or the termination of any Commitment after the
making of any Swing Line Loan; (v) any breach of any Loan Document by any
Person; or (vi) any other circumstance, happening or event whatsoever, whether
or not similar to any of the foregoing. If, prior to the making of a Revolving
Loan pursuant to this clause, any Default described in clauses (a) through (d)
of Section 8.1.9 shall have occurred and be continuing, each Revolving Loan
Lender will, on the date such Revolving Loan was to have been made, purchase an
undivided participation interest in the Refunded Swing Line Loan in an amount
equal to its RL Percentage of the aggregate principal amount of such Refunded
Swing Line Loan. Each Revolving Loan Lender will immediately transfer to the
Swing Line Lender, in immediately available funds, the amount of its
participation in such Refunded Swing Line Loan.
(c) If any Revolving Loan Lender does not make a Revolving Loan (or
otherwise purchase from the Revolving Loan Lender an undivided participation
interest) in an amount (the "Outstanding Amount") equal to such Lender's RL
Percentage of the aggregate principal amount of all Refunded Swing Line Loans
pursuant to clause (b) above on the applicable due date with respect thereto,
then such Revolving Loan Lender shall promptly pay to the Swing Line Lender on
demand such Outstanding Amount with interest thereon accruing at the Federal
Funds Effective Rate for each day from (and including) the date such Outstanding
Amount should have been made available to the Swing Line Lender to (but
excluding) the date upon which such Revolving Loan Lender actually paid such
Outstanding Amount to the Swing Line Lender. If such Revolving Loan Lender pays
such Outstanding Amount to the Swing Line Lender, then, on and as of the date of
such payment, such Outstanding Amount shall constitute such Revolving Loan
Lender's Loan including in such Refunded Swing Line Loan or the consideration
for the purchase of its undivided participation interest, as the case may be.
(d) The failure or refusal of any Revolving Loan Lender to make a
Revolving Loan (or otherwise purchase from the Revolving Loan Lender an
undivided participation interest) in an amount equal to such Lender's RL
Percentage of the aggregate principal amount of all Refunded Swing Line Loans
pursuant to clause (b) above on the applicable due date with respect thereto
shall not (i) relieve any other Revolving Loan Lender from its several
obligation hereunder to make a Revolving Loan (or otherwise purchase an
undivided participation interest) pursuant to clause (b) above and (ii) impose
upon such other Revolving Loan Lender any liability with respect to such failure
or refusal or otherwise increase such other Revolving Loan Lender's RL
Percentage of the Revolving Loan Commitment Amount.
SECTION 2.4. Continuation and Conversion Elections. By delivering a
Continuation/Conversion Notice to the Administrative Agent on or before 12:00
noon on a Business Day, the Borrower may from time to time irrevocably elect, on
not less than one Business Day's notice in the case of Base Rate Loans, or three
Business Days' notice in the case of LIBO Rate Loans, and in either case not
more than ten Business Days' notice, that all, or any portion in an aggregate
minimum amount of $500,000 and an integral multiple of $100,000 be, in the case
of Base Rate Loans, converted into LIBO Rate Loans or be, in the case of LIBO
Rate Loans, converted into Base Rate Loans or continued as LIBO Rate Loans (in
the absence of delivery of a Continuation/Conversion Notice with respect to any
LIBO Rate Loan at least three Business Days (but not more than ten Business
Days) before the last day of the then current Interest Period with respect
thereto, such LIBO Rate Loan shall, on such last day, automatically convert to a
Base Rate Loan); provided, however, that (x) each such conversion or
continuation shall be pro rated among the applicable outstanding Loans of all
Lenders that have made such Loans, and (y) no portion of the outstanding
principal amount of any Loans may be continued as, or be converted into, LIBO
Rate Loans when any Default has occurred and is continuing.
SECTION 2.5. Funding. Each Lender may, if it so elects, fulfill its
obligation to make, continue or convert LIBO Rate Loans hereunder by causing one
of its foreign branches or Affiliates (or an international banking facility
created by such Lender) to make or maintain such LIBO Rate Loan; provided,
however, that such LIBO Rate Loan shall nonetheless be deemed to have been made
and to be held by such Lender, and the obligation of the Borrower to repay such
LIBO Rate Loan shall nevertheless be to such Lender for the account of such
foreign branch, Affiliate or international banking facility. In addition, the
Borrower hereby consents and agrees that, for purposes of any determination to
be made for purposes of Section 4.1, 4.2, 4.3 or 4.4, it shall be conclusively
assumed that each Lender elected to fund all LIBO Rate Loans by purchasing
Dollar deposits in its LIBOR Office's interbank eurodollar market.
SECTION 2.6. Issuance Procedures. By delivering to the Administrative
Agent an Issuance Request on or before 12:00 noon on a Business Day, the
Borrower may from time to time irrevocably request on not less than two nor more
than ten Business Days' notice, in the case of an initial issuance of a Letter
of Credit and not less than two Business Days' prior notice, in the case of a
request for the extension of the Stated Expiry Date of a standby Letter of
Credit (in each case, unless a shorter notice period is agreed to by the
applicable Issuer, in its sole discretion), that such Issuer issue, or extend
the Stated Expiry Date of, a Letter of Credit in such form as may be requested
by the Borrower and approved by such Issuer, solely for the purposes described
in Section 7.1.7. Each Letter of Credit shall by its terms be stated to expire
on a date (its "Stated Expiry Date") no later than the earlier to occur of (i)
the Revolving Loan Commitment Termination Date or (ii) (unless otherwise agreed
to by the Issuer, in its sole discretion), one year from the date of its
issuance. Each Issuer will make available to the beneficiary thereof the
original of the Letter of Credit which it issues.
SECTION 2.6.1. Other Lenders' Participation. Upon the issuance of each
Letter of Credit, and without further action, each Revolving Loan Lender (other
than the applicable Issuer) shall be deemed to have irrevocably purchased, to
the extent of its RL Percentage, a participation interest in such Letter of
Credit (including the Contingent Liability in respect thereof), and such
Revolving Loan Lender shall, to the extent of its RL Percentage, be responsible
for reimbursing within one Business Day the applicable Issuer for any amount
drawn under a Letter of Credit which has not been reimbursed by the Borrower in
accordance with Section 2.6.3. In addition, such Revolving Loan Lender shall, to
the extent of its RL Percentage, be entitled to receive a ratable portion of the
Letter of Credit fees payable pursuant to Section 3.3.3 with respect to each
Letter of Credit (other than the issuance fees payable to the Issuer of such
Letter of Credit pursuant to the last sentence of Section 3.3.3) and of interest
payable pursuant to Section 3.2 with respect to any Reimbursement Obligation. To
the extent that any Revolving Loan Lender has reimbursed any Issuer for a
Disbursement, such Lender shall be entitled to receive its ratable portion of
any amounts subsequently received (from the Borrower or otherwise) in respect of
such Disbursement.
SECTION 2.6.2. Disbursements. The applicable Issuer will notify the
Borrower and the Administrative Agent promptly of the presentment for payment of
any Letter of Credit issued by such Issuer, together with notice of the date
(the "Disbursement Date") such payment shall be made (each such payment, a
"Disbursement"). Subject to the terms and provisions of such Letter of Credit
and this Agreement, the applicable Issuer shall make such payment to the
beneficiary (or its designee) of such Letter of Credit. Prior to 1:00 p.m. on
the first Business Day following the Disbursement Date, the Borrower will
reimburse the Administrative Agent, for the account of the applicable Issuer,
for all amounts which such Issuer has disbursed under such Letter of Credit,
together with interest thereon at a rate per annum equal to the rate per annum
then in effect for Base Rate Loans (with the then Applicable Margin for
Revolving Loans accruing on such amount) pursuant to Section 3.2 for the period
from the Disbursement Date through the date of such reimbursement. Without
limiting in any way the foregoing and notwithstanding anything to the contrary
contained herein or in any separate application for any Letter of Credit, the
Borrower hereby acknowledges and agrees that it shall be obligated to reimburse
the applicable Issuer upon each Disbursement of a Letter of Credit, and it shall
be deemed to be the obligor for purposes of each such Letter of Credit issued
hereunder (whether the account party on such Letter of Credit is the Borrower or
a Subsidiary Guarantor (other than UAS)).
SECTION 2.6.3. Reimbursement. The obligation (a "Reimbursement
Obligation") of the Borrower under Section 2.6.2 to reimburse the applicable
Issuer with respect to each Disbursement (including interest thereon), and, upon
the failure of the Borrower to reimburse such Issuer, each Revolving Loan
Lender's obligation under Section 2.6.1 to pay to such Issuer its RL Percentage
of any drawing under a Letter of Credit, shall be absolute and unconditional
under any and all circumstances and irrespective of any setoff, counterclaim or
defense to payment which the Borrower or such Revolving Loan Lender, as the case
may be, may have or have had against such Issuer or any Lender, including any
defense based upon the failure of any Disbursement to conform to the terms of
the applicable Letter of Credit (if, in such Issuer's good faith opinion, such
Disbursement is determined to be appropriate) or any non-application or
misapplication by the beneficiary of the proceeds of such Letter of Credit;
provided, however, that after paying in full its Reimbursement Obligation
hereunder or paying its RL Percentage of any drawing under a Letter of Credit,
as the case may be, nothing herein shall adversely affect the right of the
Borrower or such Lender, as the case may be, to commence any proceeding against
such Issuer for any wrongful Disbursement made by the Issuer under a Letter of
Credit as a result of acts or omissions constituting gross negligence or wilful
misconduct on the part of such Issuer.
SECTION 2.6.4. Deemed Disbursements. Upon the occurrence and during
the continuation of any Default under Section 8.1.9 or upon notification by the
Administrative Agent (acting at the direction of the Required Lenders) to the
Borrower of its obligations under this Section, following the occurrence and
during the continuation of any other Event of Default,
(a) the aggregate Stated Amount of all Letters of Credit shall,
without demand upon or notice to the Borrower or any other Person, be
deemed to have been paid or disbursed by the applicable Issuer of such
Letters of Credit (notwithstanding that such amount may not in fact have
been paid or disbursed); and
(b) the Borrower shall be immediately obligated to reimburse such
Issuer for the amount deemed to have been so paid or disbursed by such
Issuer.
Amounts payable by the Borrower pursuant to this Section shall be deposited in
immediately available funds with the Administrative Agent and held as collateral
security for the Reimbursement Obligations. When all Defaults giving rise to the
deemed disbursements under this Section have been cured or waived the
Administrative Agent shall return to the Borrower all amounts then on deposit
with the Administrative Agent pursuant to this Section which have not been
applied to the satisfaction of the Reimbursement Obligations.
SECTION 2.6.5. Nature of Reimbursement Obligations. The Borrower, each
other Obligor and, to the extent set forth in Section 2.6.1, each Revolving Loan
Lender shall assume all risks of the acts, omissions or misuse of any Letter of
Credit by the beneficiary thereof. No Issuer (except to the extent of its own
gross negligence or wilful misconduct) shall be responsible for:
(a) the form, validity, sufficiency, accuracy, genuineness or legal
effect of any Letter of Credit or any document submitted by any party in
connection with the application for and issuance of a Letter of Credit,
even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged;
(b) the form, validity, sufficiency, accuracy, genuineness or legal
effect of any instrument transferring or assigning or purporting to
transfer or assign a Letter of Credit or the rights or benefits thereunder
or the proceeds thereof in whole or in part, which may prove to be invalid
or ineffective for any reason;
(c) failure of the beneficiary to comply fully with conditions
required in order to demand payment under a Letter of Credit;
(d) errors, omissions, interruptions or delays in transmission or
delivery of any messages, by mail, cable, telegraph, telex or otherwise;
or
(e) any loss or delay in the transmission or otherwise of any
document or draft required in order to make a Disbursement under a Letter
of Credit.
None of the foregoing shall affect, impair or prevent the vesting of any of the
rights or powers granted to any Issuer or any Revolving Loan Lender hereunder.
In furtherance and not in limitation or derogation of any of the foregoing, any
action taken or omitted to be taken by any Issuer in good faith (and not
constituting gross negligence or willful misconduct) shall be binding upon each
Obligor and each such Secured Party, and shall not put such Issuer under any
resulting liability to any Obligor or any Secured Party, as the case may be.
SECTION 2.7. Register; Notes.
(a) Each Lender may maintain in accordance with its usual practice an
account or accounts evidencing the Indebtedness of the Borrower to such Lender
resulting from each Loan made by such Lender, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder. In the
case of a Lender that does not request, pursuant to clause (c) below, execution
and delivery of a Note evidencing the Loans made by such Lender to the Borrower,
such account or accounts shall, to the extent not inconsistent with the
notations made by the Administrative Agent in the Register, be conclusive and
binding on the Borrower absent manifest error; provided, however, that the
failure of any Lender to maintain such account or accounts shall not limit or
otherwise affect any Obligations of any Obligor.
(b) The Borrower hereby designates the Administrative Agent to serve as
the Borrower's agent, solely for the purpose of this clause, to maintain a
register (the "Register") on which the Administrative Agent will record each
Lender's Commitments, the Loans made by each Lender and each repayment in
respect of the principal amount of the Loans of each Lender and annexed to which
the Administrative Agent shall retain a copy of each Lender Assignment Agreement
delivered to the Administrative Agent pursuant to Section 10.11.1. Failure to
make any recordation, or any error in such recordation, shall not affect the
Borrower's obligation in respect of such Loans. The entries in the Register
shall be conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent and the Lenders shall treat each Person in whose name a
Loan (and as provided in clause (c) below the Note evidencing such Loan, if any)
is registered as the owner thereof for all purposes of this Agreement,
notwithstanding notice or any provision herein to the contrary. A Lender's
Commitment and the Loans made pursuant thereto may be assigned or otherwise
transferred in whole or in part only by registration of such assignment or
transfer in the Register. Any assignment or transfer of a Lender's Commitment or
the Loans made pursuant thereto shall be registered in the Register only upon
delivery to the Administrative Agent of a Lender Assignment Agreement duly
executed by the assignor thereof and the compliance by the parties thereto with
the other requirements of Section 10.11.1. No assignment or transfer of a
Lender's Commitment or the Loans made pursuant thereto shall be effective unless
such assignment or transfer shall have been recorded in the Register by the
Administrative Agent as provided in this Section.
(c) The Borrower agrees that, upon the request to the Administrative Agent
by any Lender, the Borrower will execute and deliver to such Lender, as
applicable, a Revolving Note, a Term A Note and/or a Term B Note evidencing the
Loans made by such Lender. The Borrower hereby irrevocably authorizes each
Lender to make (or cause to be made) appropriate notations on the grid attached
to such Lender's Notes (or on any continuation of such grid), which notations,
if made, shall evidence, inter alia, the date of, the outstanding principal
amount of, and the interest rate and Interest Period applicable to the Loans
evidenced thereby. Such notations shall, to the extent not inconsistent with the
notations made by the Administrative Agent in the Register, be conclusive and
binding on the Borrower absent manifest error; provided, however, that the
failure of any Lender to make any such notations or any error in any such
notations shall not limit or otherwise affect any Obligations of any Obligor.
The Loans evidenced by any such Note and interest thereon shall at all times
(including after assignment pursuant to Section 10.11.1) be represented by one
or more Notes payable to the order of the payee named therein and its registered
assigns. A Note and the obligation evidenced thereby may be assigned or
otherwise transferred in whole or in part only by registration of such
assignment or transfer of such Note and the obligation evidenced thereby in the
Register (and each Note shall expressly so provide). Any assignment or transfer
of all or part of an obligation evidenced by a Note shall be registered in the
Register only upon surrender for registration of assignment or transfer of the
Note evidencing such obligation, accompanied by a Lender Assignment Agreement
duly executed by the assignor thereof, and thereupon, if requested by the
assignee, one or more new Notes shall be issued to the designated assignee (and
to the assignor, if the assignor is retaining any of the Loans) and the old Note
shall be returned by the Administrative Agent to the Borrower marked
"exchanged". No assignment of a Note and the obligation evidenced thereby shall
be effective unless it shall have been recorded in the Register by the
Administrative Agent as provided in this Section.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments; Application. The Borrower
agrees that the Loans shall be repaid and prepaid pursuant to the following
terms.
SECTION 3.1.1. Repayments and Prepayments. The Borrower shall repay
in full the unpaid principal amount of each Loan upon the applicable Stated
Maturity Date therefor. Prior thereto, payments and prepayments of Loans shall
or may be made as set forth below.
(a) From time to time on any Business Day, the Borrower may make a
voluntary prepayment, in whole or in part, of the outstanding principal
amount of any
(i) Loans (other than Swing Line Loans); provided, however,
that (A) in the case of Term Loans, the Borrower may elect to prepay
either Term A Loans or Term B Loans, such prepayment to be applied
pro rata among the Term Loans so prepaid of the same type and, if
applicable, having the same Interest Period of all Lenders that have
made such Term Loans (to be applied as set forth in clause (a) of
Section 3.1.2 and with the amount of such prepayment of the Term A
Loans or Term B Loans, as applicable, being applied to the remaining
scheduled amortization payments thereof in direct order in
accordance with the amount of each such remaining Term A Loan or
Term B Loan amortization payments); (B) with respect to Term B Loans
only, there shall be a prepayment fee of (1) 2.0% of the principal
amount of such Loans voluntarily prepaid on or prior to December 10,
2000, (2) 1.0% of the principal amount of such Loans voluntarily
prepaid from (and including) December 11, 2000 through (and
including) December 10, 2001, and (3) 0% thereafter; (C) any such
prepayment of Revolving Loans shall be made pro rata among the
Revolving Loans of the same type and, if applicable, having the same
Interest Period of all Lenders that have made such Revolving Loans;
(D) all such voluntary prepayments shall require at least one but no
more than five Business Days' prior written notice to the
Administrative Agent; and (E) all such voluntary partial prepayments
of any Loans shall be in an aggregate minimum amount of $500,000 and
an integral multiple of $100,000.
(ii) Swing Line Loans; provided, that (A) all such voluntary
prepayments shall require prior telephonic notice to the Swing Line
Lender on or before 1:00 p.m. on the day of such prepayment (such
notice to be confirmed in writing within 24 hours thereafter); and
(B) all such voluntary partial prepayments shall be in an aggregate
minimum amount of $200,000 and an integral multiple of $100,000.
(b) On each date when the sum of (i) the aggregate outstanding
principal amount of all Revolving Loans and Swing Line Loans and (ii) the
aggregate amount of all Letter of Credit Outstandings exceeds the
Revolving Loan Commitment Amount (as it may be reduced from time to time
pursuant to this Agreement), the Borrower shall make a mandatory
prepayment of Revolving Loans or Swing Line Loans (or both) and, if
necessary, Cash Collateralize Letter of Credit Outstandings, in an
aggregate amount equal to such excess.
(c) On the Stated Maturity Date for Term A Loans and on each
Quarterly Payment Date occurring during any period set forth below, the
Borrower shall make a scheduled repayment of the aggregate outstanding
principal amount, if any, of all Term A Loans in an amount equal to the
amount set forth below opposite the Stated Maturity Date or such Quarterly
Payment Date, as applicable:
Amount of Required
Period Principal Repayment
------ -------------------
10/16/00 through (and
including) 10/16/01 $1,875,000.00
10/17/01 through (and
including) 10/15/02 $3,750,000.00
10/16/02 through (and
including) 10/15/03 $7,500,000.00
10/16/03 through (and
including) 10/15/04 $9,375,000.00
10/16/04 through (and
including) 10/17/05 $12,000,000.00
Stated Maturity Date for
Term A Loans $12,000,000.00 or, if different,
the then outstanding principal
amount of all Term A Loans.
(d) On the Stated Maturity Date for Term B Loans and on each
Quarterly Payment Date occurring during any period set forth below, the
Borrower shall make a scheduled repayment of the aggregate outstanding
principal amount, if any, of all Term B Loans in an amount equal to the
amount set forth below opposite the Stated Maturity Date or such Quarterly
Payment Date, as applicable:
Amount of Required
Period Principal Repayment
------ -------------------
Closing Date through (and
including) 04/15/05 $625,000.00
04/16/05 through (and
including) 04/17/06 $47,250,000.00
Stated Maturity Date for
Term B Loans $47,250,000.00 or, if different,
the then outstanding principal
amount of all Term B Loans.
(e) No later than five Business Days following the delivery by the
Borrower of its annual audited financial reports required pursuant to
clause (b) of Section 7.1.1 (beginning with the financial reports
delivered in respect of the 2000 Fiscal Year), the Borrower shall deliver
to the Administrative Agent a calculation of the Excess Cash Flow for the
Fiscal Year last ended and, no later than five Business Days following the
delivery of such calculation, make or cause to be made a mandatory
prepayment of the Term Loans in an amount equal to 50% of the Excess Cash
Flow (if any) for such Fiscal Year to be applied as set forth in Section
3.1.2; provided, however, that such prepayment shall only be required to
be made to the extent that the amount of Indebtedness, as reduced by
giving effect to such prepayment, would result in a Leverage Ratio of
greater than 3.50:1.00 on a pro forma basis as of the date of such
prepayment.
(f) No later than one Business Day (in the case of Net Debt
Proceeds) or 30 calendar days (in the case of Net Disposition Proceeds)
following the receipt of any Net Disposition Proceeds from any Disposition
or a series of related Dispositions, the aggregate amount of which is in
excess of $50,000 or Net Debt Proceeds by the Borrower or any of its
Subsidiaries, the Borrower shall deliver to the Administrative Agent a
calculation of the amount of such Net Disposition Proceeds or Net Debt
Proceeds, as the case may be, and, to the extent the amount of such Net
Disposition Proceeds or Net Debt Proceeds, as the case may be, with
respect to any single transaction or series of related transactions,
exceeds $2,000,000, make a mandatory prepayment of the Term Loans in an
amount equal to 100% of such Net Disposition Proceeds or Net Debt
Proceeds, as the case may be, to be applied as set forth in Section 3.1.2;
provided, that no mandatory prepayment on account of such Net Disposition
Proceeds shall be required under this clause if the Borrower informs the
Administrative Agent no later than 30 days following the receipt of any
Net Disposition Proceeds of its or its Subsidiary's good faith intention
to apply such Net Disposition Proceeds to the acquisition of other assets
or property consistent with the business permitted to be conducted
pursuant to Section 7.2.1 (including by way of merger or Investment)
within 365 days following the receipt of such Net Disposition Proceeds,
with the amount of such Net Disposition Proceeds unused after such 365 day
period being applied to the Loans pursuant to Section 3.1.2.
(g) The Borrower shall, concurrently with the receipt of any Net
Equity Proceeds by the Borrower or any of its Subsidiaries, deliver to the
Administrative Agent a calculation of the amount of such Net Equity
Proceeds, and no later than five Business Days following the delivery of
such calculation, and, to the extent that the amount of such Net Equity
Proceeds with respect to any single transaction or series of related
transactions exceeds $2,000,000, and subject to the proviso below, make or
cause to be made a mandatory prepayment of the Term Loans in an amount
equal to 50% of such Net Equity Proceeds to be applied as set forth in
Section 3.1.2; provided, however, that such prepayment shall only be
required to be made to the extent that the amount of Indebtedness, as
reduced by giving effect to such prepayment would result in a Leverage
Ratio of greater than 3.50:1 on a pro forma basis as of the date of such
prepayment;
(h) The Borrower shall, no later than the 60th calendar day
following the receipt by the Borrower or any of its Subsidiaries of any
Casualty Proceeds in excess of $2,000,000 (individually or in the
aggregate in any Fiscal Year), make or cause to be made a mandatory
prepayment of the Term Loans in an amount equal to 100% of such Casualty
Proceeds, to be applied as set forth in Section 3.1.2; provided, that no
mandatory prepayment on account of Casualty Proceeds shall be required
under this clause if the Borrower informs the Administrative Agent no
later than 60 days following the occurrence of the Casualty Event
resulting in such Casualty Proceeds of its or its Subsidiary's good faith
intention to apply such Casualty Proceeds to the rebuilding or replacement
of the damaged, destroyed or condemned assets or property subject to such
Casualty Event or the acquisition of other assets or property consistent
with the business permitted to be conducted pursuant to Section 7.2.1
(including by way of merger or Investment) and in fact uses or commits to
use such Casualty Proceeds to rebuild or replace the damaged, destroyed or
condemned assets or property subject to such Casualty Event or to acquire
such other property or assets within 365 days following the receipt of
such Casualty Proceeds, with the amount of such Casualty Proceeds unused
after such 365 day period being applied to the Loans pursuant to Section
3.1.2; provided further, however, that at any time when any Event of
Default shall have occurred and be continuing or Casualty Proceeds not
applied as provided above shall exceed $2,000,000, such Casualty Proceeds
will be deposited in an account maintained with the Administrative Agent
for disbursement at the request of the Borrower to pay for such
rebuilding, replacement or acquisition.
(i) Immediately upon any acceleration of the Stated Maturity Date of
any Loans pursuant to Section 8.2 or Section 8.3, the Borrower shall repay
all the Loans, unless, pursuant to Section 8.3, only a portion of all the
Loans is so accelerated (in which case the portion so accelerated shall be
so repaid).
Each prepayment of any Loans made pursuant to this Section shall be without
premium or penalty, except as may be required by Section 4.4.
SECTION 3.1.2. Application. Amounts prepaid pursuant to Section 3.1.1
shall be applied as set forth in this Section.
(a) Subject to clause (b), each prepayment or repayment of the
principal of the Loans shall be applied, to the extent of such prepayment
or repayment, first, to the principal amount thereof being maintained as
Base Rate Loans, and second, subject to the terms of Section 4.4, to the
principal amount thereof being maintained as LIBO Rate Loans.
(b) Each prepayment of Term Loans made pursuant to clauses (e), (f),
(g) and (h) of Section 3.1.1 shall be applied (i) first, pro rata to a
mandatory prepayment of the outstanding principal amount of all Term A
Loans and Term B Loans (with the amount of such prepayment of the Term A
Loans and the Term B Loans being applied to the remaining scheduled
amortization payments of the Term A Loans or Term B Loans, as the case may
be, in inverse order in accordance with the amount of each such remaining
Term A Loan or Term B Loan amortization payments, and (ii) second, once
all Term Loans have been repaid in full, to the repayment of any
outstanding Revolving Loans and, in the case of prepayments pursuant to
clause (e), (f), (g) or (h) of Section 3.1.1, to a reduction of the
Revolving Loan Commitment Amount in accordance with Section 2.2.2;
provided, however, that, in the case of any prepayment of Term B Loans
made pursuant to clause (e), (f), (g) or (h) of Section 3.1.1, if the
Borrower (at any time prior to the repayment in full of the Term A Loans)
elects in writing, in its sole discretion, to permit any Lender that has
Term B Loans to decline to have such Loans so prepaid, then any Lender
that has Term B Loans may, by delivering a notice to the Administrative
Agent at least one Business Day prior to the date that such prepayment is
to be made, decline to have such Loans prepaid with the amounts set forth
above, in which case 50% of the amounts that would have been applied to a
prepayment of such Lender's Term B Loans shall instead be applied to a
prepayment of the principal amount of all outstanding Term A Loans until
all outstanding Term A Loans have been prepaid in full, with the balance
being retained by the Borrower.
SECTION 3.2. Interest Provisions. Interest on the outstanding
principal amount of Loans shall accrue and be payable in accordance with the
terms set forth below.
SECTION 3.2.1. Rates. Pursuant to an appropriately delivered Borrowing
Request or Continuation/Conversion Notice, the Borrower may elect that Loans
comprising a Borrowing accrue interest at a rate per annum:
(a) on that portion maintained from time to time as a Base Rate
Loan, equal to the sum of the Adjusted Base Rate from time to time in
effect plus the Applicable Margin; provided that all Swing Line Loans
shall always accrue interest at the then effective Applicable Margin for
Revolving Loans maintained as Base Rate Loans; and
(b) on that portion maintained as a LIBO Rate Loan, during each
Interest Period applicable thereto, equal to the sum of the Adjusted LIBO
Rate for such Interest Period plus the Applicable Margin.
All LIBO Rate Loans shall bear interest from and including the first day of the
applicable Interest Period to (but not including) the last day of such Interest
Period at the interest rate determined as applicable to such LIBO Rate Loan.
SECTION 3.2.2. Post-Maturity Rates. After the date any principal amount
of any Loan or Reimbursement Obligation is due and payable (whether on the
Stated Maturity Date, upon acceleration or otherwise), or after any other
monetary Obligation of the Borrower shall have become due and payable, the
Borrower shall pay, but only to the extent permitted by law, interest (after as
well as before judgment) on such amounts at a rate per annum equal to the
Adjusted Base Rate from time to time in effect, plus the Applicable Margin for
Term B Loans accruing interest at the Base Rate, plus a margin of 2%.
SECTION 3.2.3. Payment Dates. Interest accrued on each Loan shall be
payable, without duplication:
(a) on the Stated Maturity Date therefor;
(b) on the date of any payment or prepayment, in whole or in part,
of principal outstanding on any Loan which is a LIBO Rate Loan on the
principal amount so paid or prepaid;
(c) with respect to Base Rate Loans, on each Quarterly Payment
Date occurring after the Closing Date;
(d) with respect to LIBO Rate Loans, on the last day of each
applicable Interest Period (and, if such Interest Period shall exceed
three months, on the date occurring on each three-month interval occurring
after the first day of such Interest Period); and
(e) on that portion of any Loans the Stated Maturity Date of which
is accelerated pursuant to Section 8.2 or 8.3, immediately upon such
acceleration.
Interest accrued on Loans or other monetary Obligations after the date such
amount is due and payable (whether on the Stated Maturity Date, upon
acceleration or otherwise) shall be payable upon demand.
SECTION 3.3. Fees. The Borrower agrees to pay the fees set forth below.
All such fees shall be non-refundable.
SECTION 3.3.1. Commitment Fee. The Borrower agrees to pay to the
Administrative Agent for the account of each Lender, for the period (including
any portion thereof when any of its Commitments are suspended by reason of the
Borrower's inability to satisfy any condition of Article V) commencing on the
Closing Date and continuing through the applicable Commitment Termination Date,
a commitment fee in an amount equal to the Applicable Commitment Fee, in each
case on such Lender's Percentage of the sum of the average daily unused portion
of the Revolving Loan Commitment Amount (net of Letter of Credit Outstandings,
in the case of the Revolving Loan Commitment Amount). All commitment fees
payable pursuant to this Section shall be calculated on a year comprised of 360
days and payable by the Borrower in arrears on the Closing Date and thereafter
on each Quarterly Payment Date, commencing with the first Quarterly Payment Date
following the Closing Date, and on the Revolving Loan Commitment Termination
Date. The making of Swing Line Loans shall not constitute usage of the Revolving
Loan Commitment with respect to the calculation of commitment fees to be paid by
the Borrower to the Lenders (other than in the case of the Swing Line Lender).
SECTION 3.3.2. Administrative Agent's Fees. The Borrower agrees to pay
to the Administrative Agent, for its own account, the fees in the amounts and on
the dates set forth in the Administrative Agent's Fee Letter
SECTION 3.3.3. Letter of Credit Fee. The Borrower agrees to pay to the
Administrative Agent, for the pro rata account of the each applicable Issuer and
each Revolving Loan Lender, a Letter of Credit fee in an amount equal to the
then effective Applicable Margin for Revolving Loans maintained as LIBO Rate
Loans, multiplied by the Stated Amount of each such Letter of Credit, such fees
being payable quarterly in arrears on each Quarterly Payment Date following the
date of issuance of each Letter of Credit and on the Revolving Loan Commitment
Termination Date. The Borrower further agrees to pay to each applicable Issuer
quarterly in arrears on each Quarterly Payment Date following the date of
issuance of each Letter of Credit and on the Revolving Loan Commitment
Termination Date a fronting fee as specified in the Administrative Agent's Fee
Letter or as otherwise agreed to by the Borrower and the applicable Issuer.
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 4.1. LIBO Rate Lending Unlawful. If any Lender shall determine
(which determination shall, upon notice thereof to the Borrower and the
Administrative Agent, be conclusive and binding on the Borrower) that the
introduction of or any change in or in the interpretation of any law makes it
unlawful, or any Governmental Authority asserts that it is unlawful, for such
Lender to make or continue any Loan as, or to convert any Loan into, a LIBO Rate
Loan, the obligations of such Lender to make, continue or convert any such LIBO
Rate Loan shall, after the determination thereof, forthwith be suspended until
such Lender shall notify the Administrative Agent that the circumstances causing
such suspension no longer exist, and all outstanding LIBO Rate Loans payable to
such Lender shall automatically convert into Base Rate Loans at the end of the
then current Interest Periods with respect thereto or sooner, if required by
such law or assertion.
SECTION 4.2. Deposits Unavailable. If the Administrative Agent shall
have determined that
(a) Dollar deposits in the relevant amount and for the relevant
Interest Period are not available to it in its relevant market; or
(b) by reason of circumstances affecting its relevant market,
adequate means do not exist for ascertaining the interest rate applicable
hereunder to LIBO Rate Loans;
then, upon notice from the Administrative Agent to the Borrower and the Lenders,
the obligations of all Lenders under Sections 2.3 and 2.4 to make or continue
any Loans as, or to convert any Loans into, LIBO Rate Loans shall forthwith be
suspended until the Administrative Agent shall notify the Borrower and the
Lenders that the circumstances causing such suspension no longer exist.
SECTION 4.3. Increased LIBO Rate Loan Costs, etc. The Borrower agrees to
reimburse each Lender and each Issuer for any increase in the cost to such
Lender or such Issuer of, or any reduction in the amount of any sum receivable
by such Secured Party in respect of, such Secured Party's Commitments and the
making of Credit Extensions hereunder (including the making, continuing or
maintaining (or of its obligation to make or continue) any Loans as, or of
converting (or of its obligation to convert) any Loans into, LIBO Rate Loans)
that arise in connection with any change in, or the introduction, adoption,
effectiveness, interpretation, reinterpretation or phase-in after the Closing
Date of, any law or regulation, directive, guideline, decision or request
(whether or not having the force of law) of any Governmental Authority, except
for (i) such changes with respect to increased capital costs and Taxes which are
governed by Sections 4.5 and 4.6, respectively, and (ii) increased costs which
are already included in the determination of the Statutory Reserve Rate. Each
affected Secured Party shall promptly notify the Administrative Agent and the
Borrower in writing of the occurrence of any such event, stating the reasons
therefor and the additional amount required fully to compensate such Secured
Party for such increased cost or reduced amount. Such additional amounts shall
be payable by the Borrower directly to such Secured Party within ten days of its
receipt of such notice, and such notice shall, in the absence of manifest error,
be conclusive and binding on the Borrower.
SECTION 4.4. Funding Losses. In the event any Lender shall incur any loss
or expense (including any loss or expense incurred by reason of the liquidation
or reemployment of deposits or other funds acquired by such Lender to make or
continue any portion of the principal amount of any Loan as, or to convert any
portion of the principal amount of any Loan into, a LIBO Rate Loan) as a result
of
(a) any conversion or repayment or prepayment of the principal
amount of any LIBO Rate Loan on a date other than the scheduled last day
of the Interest Period applicable thereto, whether pursuant to Article III
or otherwise;
(b) any Loans not being made as LIBO Rate Loans in accordance with
the Borrowing Request therefor; or
(c) any Loans not being continued as, or converted into, LIBO Rate
Loans in accordance with the Continuation/Conversion Notice therefor;
but in each case other than due to such Lender's failure to fulfill its
obligations hereunder, then, upon the written notice of such Lender to the
Borrower (with a copy to the Administrative Agent), the Borrower shall, within
ten days of its receipt thereof, pay directly to such Lender such amount as will
(in the reasonable determination of such Lender) reimburse such Lender for such
loss or expense. Such written notice shall, in the absence of manifest error, be
conclusive and binding on the Borrower.
SECTION 4.5. Increased Capital Costs. If, after the Closing Date, any
change in, or the introduction, adoption, effectiveness, interpretation,
reinterpretation or phase-in of, any law or regulation, directive, guideline,
decision or request (whether or not having the force of law) of any Governmental
Authority affects or would affect the amount of capital required or expected to
be maintained by any Secured Party or any Person controlling such Secured Party,
and such Secured Party determines (in good faith but in its sole and absolute
discretion) that the rate of return on its or such controlling Person's capital
as a consequence of the Commitments or the Credit Extensions made, or the
Letters of Credit participated in, by such Secured Party is reduced to a level
below that which such Secured Party or such controlling Person could have
achieved but for the occurrence of any such circumstance, then upon notice from
time to time by such Secured Party to the Borrower, the Borrower shall within
five days following receipt of such notice pay directly to such Secured Party
additional amounts sufficient to compensate such Secured Party or such
controlling Person for such reduction in rate of return. A statement of such
Secured Party as to any such additional amount or amounts shall, in the absence
of manifest error, be conclusive and binding on the Borrower. In determining
such amount, such Secured Party may use any reasonable method of averaging and
attribution that it (in its sole and absolute discretion) shall deem applicable.
SECTION 4.6. Taxes. The Borrower covenants and agrees as follows with
respect to Taxes.
(a) Any and all payments by the Borrower under each Loan Document
shall be made without setoff, counterclaim or other defense, and free and
clear of, and without deduction or withholding for or on account of, any
Taxes, except to the extent any Taxes are imposed by law. In the event
that any Taxes are required by law to be deducted or withheld from any
payment required to be made by the Borrower to or on behalf of any Secured
Party under any Loan Document, then:
(i) subject to clause (f), if such Taxes are Non-Excluded
Taxes, the amount of such payment shall be increased as may be
necessary such that such payment is made, after withholding or
deduction for or on account of such Non-Excluded Taxes, in an amount
that is not less than the amount provided for in such Loan Document;
and
(ii) the Borrower shall withhold the full amount of such Taxes
from such payment (as increased pursuant to clause (a)(i), if
applicable) and shall pay such amount to the Governmental Authority
imposing such Taxes in accordance with applicable law.
(b) In addition, the Borrower shall pay any and all Other Taxes
imposed on or with respect to a Secured Party to the relevant Governmental
Authority imposing such Other Taxes in accordance with applicable law.
(c) As promptly as practicable after the payment of any Taxes or
Other Taxes, and in any event within 45 days of any such payment, the
Borrower shall furnish to the Administrative Agent a copy of an official
receipt (or a certified copy thereof) or if obtaining such receipt or copy
is impractical, other documentation necessary for purposes of claiming a
foreign tax credit evidencing the payment of such Taxes or Other Taxes.
The Administrative Agent shall make copies thereof available to any Lender
upon request therefor.
(d) Subject to clause (f), the Borrower shall indemnify each Secured
Party for any Non-Excluded Taxes and Other Taxes levied, imposed, assessed
on or actually paid by or on behalf of such Secured Party (whether or not
such Non-Excluded Taxes or Other Taxes are correctly or legally asserted
by the relevant Governmental Authority). Promptly upon having actual
knowledge that any such Non-Excluded Taxes or Other Taxes have been
levied, imposed or assessed, and promptly upon notice thereof by any
Secured Party, the Borrower shall pay such Non-Excluded Taxes or Other
Taxes directly to the relevant Governmental Authority (provided, however,
that no Secured Party shall be under any obligation to provide any such
notice to the Borrower). In addition, the Borrower shall indemnify each
Secured Party for any incremental Taxes that are paid or payable by such
Secured Party as a result of any failure of the Borrower to pay any Taxes
when due to the appropriate Governmental Authority or to deliver to the
Administrative Agent, pursuant to clause (c), documentation evidencing the
payment of Taxes or Other Taxes. With respect to indemnification for
Non-Excluded Taxes and Other Taxes actually paid by any Secured Party or
the indemnification provided in the immediately preceding sentence, such
indemnification shall be made within 30 days after the date such Secured
Party makes written demand therefor. The Borrower acknowledges that any
payment made to any Secured Party or to any Governmental Authority in
respect of the indemnification obligations of the Borrower provided in
this clause shall constitute a payment in respect of which the provisions
of clause (a) and this clause shall apply.
(e) Each Non-Domestic Secured Party, on or prior to the date on
which such Non-Domestic Secured Party becomes a Secured Party hereunder
(and from time to time thereafter upon the request of the Borrower or the
Administrative Agent, but only for so long as such Non-Domestic Secured
Party is legally entitled to do so), shall deliver to the Borrower and the
Administrative Agent either
(i) two properly completed and duly executed copies of (A)
Internal Revenue Service Form W-8BEN and (B) Internal Revenue
Service Form 4224 or Form 1001 or, in either case, an applicable
successor form; or
(ii) in the case of a Non-Domestic Secured Party that is not
legally entitled to deliver either form listed in clause (e)(i), (x)
a certificate in form and substance reasonably satisfactory to the
Borrower and the Administrative Agent of a duly authorized officer
of such Non-Domestic Secured Party to the effect that such
Non-Domestic Secured Party is not (A) a "bank" within the meaning of
Section 881(c)(3)(A) of the Code, (B) a "10 percent shareholder" of
the Borrower within the meaning of Section 881(c)(3)(B) of the Code,
or (C) a controlled foreign corporation receiving interest from a
related person within the meaning of Section 881(c)(3)(C) of the
Code (such certificate, an "Exemption Certificate") and (y) two
properly completed and duly executed copies of Internal Revenue
Service Form W-8BEN or applicable successor form, in each case
certifying that such Non-Domestic Secured Party is entitled to
receive payments under this Agreement and the Notes without
deduction or withholding of any Non-Excluded Taxes. Each such
Non-Domestic Secured Party further agrees to deliver to each of the
Borrower and the Administrative Agent an additional copy of such
relevant form on or before the date such form expires or becomes
obsolete or after the occurrence of any event (including a change in
applicable lending office) requiring a change in the most recent
forms so delivered by it, in each case certifying that such
Non-Domestic Secured Party is entitled to an exemption from
withholding or deduction for or on account of Non-Excluded Taxes in
connection with payments under this Agreement or under any of the
Notes. Each such Non-Domestic Secured Party shall promptly notify
the Borrower and the Administrative Agent of any changes in
circumstances unique to such Non-Domestic Secured Party, and not
including a change in law, that would modify or render invalid any
claimed exemption or reduction.
(f) The Borrower shall not be obligated to gross up any payments to
any Secured Party pursuant to clause (a)(i), or to indemnify any Secured
Party pursuant to clause (d), in respect of Taxes to the extent imposed as
a result of (i) the failure of such Secured Party to deliver to the
Borrower the form or forms and/or an Exemption Certificate, as applicable
to such Secured Party, pursuant to clause (e), (ii) such form or forms
and/or Exemption Certificate not establishing a complete exemption from
U.S. federal withholding Tax or the information or certifications made
therein by the Secured Party being untrue or inaccurate on the date
delivered in any material respect, or (iii) the Secured Party designating
a successor lending office at which it maintains its Loans which has the
effect of causing such Secured Party to become obligated for Tax payments
in excess of those in effect immediately prior to such designation;
provided, however, that the Borrower shall be obligated to gross up any
payments to any such Secured Party pursuant to clause (a)(i), and to
indemnify any such Secured Party pursuant to clause (d), in respect of
United States federal withholding Taxes if (i) any such failure to deliver
a form or forms or an Exemption Certificate or the failure of such form or
forms or Exemption Certificate to establish a complete exemption from U.S.
federal withholding Tax or inaccuracy or untruth contained therein
resulted from a change in any applicable statute, treaty, regulation or
other applicable law or any interpretation of any of the foregoing
occurring after the date on which such Secured Party became a Secured
Party hereunder, which change rendered such Secured Party no longer
legally entitled to deliver such form or forms or Exemption Certificate or
otherwise ineligible for a complete exemption from U.S. federal
withholding Tax, or rendered the information or certifications made in
such form or forms or Exemption Certificate untrue or inaccurate in a
material respect or (ii) the obligation to gross up payments to any such
Secured Party pursuant to clause (a)(i) or to indemnify any such Secured
Party pursuant to clause (d) is with respect to an assignee Secured Party
as a result of an assignment made at the request of the Borrower.
(g) If a Secured Party receives a refund in respect of Taxes as to
which it has been grossed up by the Borrower pursuant to clause (a)(i) or
indemnified by the Borrower pursuant to clause (d) and such Secured Party
determines in its sole, good faith judgment that such refund is
attributable to such gross up or indemnification, then such Secured Party
shall pay such amount to the Borrower as such Secured Party determines to
be the proportion of the refund as will leave it, after such payment, in
no better or worse financial position with respect to Tax liabilities and
related expenses than it would have been in the absence of such payment.
No Secured Party shall be obligated to disclose information regarding its
tax affairs or computations to the Borrower in connection with this clause
or any other provision of this Section.
SECTION 4.7. Payments, Computations, etc. Unless otherwise expressly
provided in a Loan Document, all payments by the Borrower pursuant to each Loan
Document shall be made by the Borrower to the Administrative Agent for the pro
rata account of the Secured Parties entitled to receive such payment. All
payments shall be made without setoff, deduction or counterclaim not later than
1:00 p.m. on the date due in same day or immediately available funds to such
account as the Administrative Agent shall specify from time to time by notice to
the Borrower. Funds received after that time shall be deemed to have been
received by the Administrative Agent on the next succeeding Business Day. The
Administrative Agent shall promptly remit in same day funds to each Secured
Party its share, if any, of such payments received by the Administrative Agent
for the account of such Secured Party. All interest (including interest on LIBO
Rate Loans) and fees shall be computed on the basis of the actual number of days
(including the first day but excluding the last day) occurring during the period
for which such interest or fee is payable over a year comprised of 360 days (or,
in the case of interest on a Base Rate Loan (calculated at other than the
Federal Funds Effective Rate), 365 days or, if appropriate, 366 days). Payments
due on other than a Business Day shall (except as otherwise required by clause
(c) of the definition of the term "Interest Period") be made on the next
succeeding Business Day and such extension of time shall be included in
computing interest and fees in connection with that payment.
SECTION 4.8. Sharing of Payments. If any Secured Party shall obtain any
payment or other recovery (whether voluntary, involuntary, by application of
setoff or otherwise) on account of any Credit Extension or Reimbursement
Obligation (other than pursuant to the terms of Section 4.3, 4.4, 4.5 or 4.6) in
excess of its pro rata share of payments obtained by all Secured Parties, such
Secured Party shall purchase from the other Secured Parties such participations
in Credit Extensions made by them as shall be necessary to cause such purchasing
Secured Party to share the excess payment or other recovery ratably (to the
extent such other Secured Parties were entitled to receive a portion of such
payment or recovery) with each of them; provided, however, that if all or any
portion of the excess payment or other recovery is thereafter recovered from
such purchasing Secured Party, the purchase shall be rescinded and each Secured
Party which has sold a participation to the purchasing Secured Party shall repay
to the purchasing Secured Party the purchase price to the ratable extent of such
recovery together with an amount equal to such selling Secured Party's ratable
share (according to the proportion of (a) the amount of such selling Secured
Party's required repayment to the purchasing Secured Party to (b) total amount
so recovered from the purchasing Secured Party) of any interest or other amount
paid or payable by the purchasing Secured Party in respect of the total amount
so recovered. The Borrower agrees that any Secured Party purchasing a
participation from another Secured Party pursuant to this Section may, to the
fullest extent permitted by law, exercise all its rights of payment (including
pursuant to Section 4.9) with respect to such participation as fully as if such
Secured Party were the direct creditor of the Borrower in the amount of such
participation. If under any applicable bankruptcy, insolvency or other similar
law any Secured Party receives a secured claim in lieu of a setoff to which this
Section applies, such Secured Party shall, to the extent practicable, exercise
its rights in respect of such secured claim in a manner consistent with the
rights of the Secured Parties entitled under this Section to share in the
benefits of any recovery on such secured claim.
SECTION 4.9. Setoff. Each Secured Party shall, upon the occurrence and
during the continuance of any Default described in clauses (a) through (d) of
Section 8.1.9 or, with the consent of the Required Lenders, upon the occurrence
and during the continuance of any other Event of Default, have the right to
appropriate and apply to the payment of the Obligations owing to it (whether or
not then due), and (as security for such Obligations) the Borrower hereby grants
to each Secured Party a continuing security interest in, any and all balances,
credits, deposits, accounts (other than any trust accounts comprised entirely of
moneys held in trust for the benefit of Persons other than the Borrower and its
Affiliates) or moneys of the Borrower then or thereafter maintained with such
Secured Party (other than the Restricted Cash Balance); provided, however, that
any such appropriation and application shall be subject to the provisions of
Section 4.8. Each Secured Party agrees promptly to notify the Borrower and the
Administrative Agent after any such setoff and application made by such Secured
Party; provided, however, that the failure to give such notice shall not affect
the validity of such setoff and application. The rights of each Secured Party
under this Section are in addition to other rights and remedies (including other
rights of setoff under applicable law or otherwise) which such Secured Party may
have.
SECTION 4.10. Change of Lending Office. Each Secured Party agrees that if
it makes any demand for payment under Section 4.3, 4.5 or 4.6, or if any
adoption or change of the type described in Section 4.1 shall occur with respect
to it, it will, if requested by the Borrower, file a certificate or document
reasonably requested by the Borrower and/or use reasonable efforts (in either
case, consistent with its internal policy and legal and regulatory restrictions
and so long as such efforts would not be disadvantageous to it, as determined in
its sole discretion) to designate a different lending office if the filing of
such certificate or document or the making of such a designation would reduce or
obviate the need for the Borrower to make payments under Section 4.3, 4.5 or
4.6, or would eliminate or materially reduce the effect of any adoption or
change described in Section 4.1; provided, however, that nothing in this Section
shall affect or postpone any of the Obligations of the Borrower or the right of
any Secured Party provided in Section 4.1, 4.3, 4.5 or 4.6.
SECTION 4.11. Replacement of Lenders. If any Lender (an "Affected
Lender") makes a demand upon the Borrower for (or if the Borrower is otherwise
required to pay) amounts pursuant to Section 4.3, 4.5 or 4.6 (and the payment of
such amounts are, and are likely to continue to be, more onerous in the
reasonable judgment of the Borrower than with respect to the other Lenders), or
gives notice pursuant to Section 4.1 requiring a conversion of such Affected
Lender's LIBO Rate Loans to Base Rate Loans or suspending such Lender's
obligation to make Loans as, or to convert Loans into, LIBO Rate Loans, the
Borrower may, within 30 days of receipt by the Borrower of such demand or
notice, as the case may be, give notice (a "Replacement Notice") in writing to
the Administrative Agent and such Affected Lender of its intention to replace
such Affected Lender with a financial institution or other Person (a
"Replacement Lender") designated in such Replacement Notice; provided, however,
that no Replacement Notice may be given by the Borrower if (i) such replacement
conflicts with any applicable law or regulation, (ii) any Event of Default shall
have occurred and be continuing at the time of such replacement or (iii) prior
to any such replacement, such Lender shall have taken any necessary action under
Section 4.5 or 4.6 (if applicable) so as to eliminate the continued need for
payment of amounts owing pursuant to Section 4.5 or 4.6. If the Administrative
Agent shall, in the exercise of its reasonable discretion and within 30 days of
its receipt of such Replacement Notice, notify the Borrower and such Affected
Lender in writing that the Replacement Lender is satisfactory to the
Administrative Agent (such consent not being required where the Replacement
Lender is already a Lender), then such Affected Lender shall, subject to the
payment of any amounts due pursuant to Section 4.4, assign, in accordance with
Section 10.11.1, all of its Commitments, Loans, Notes (if any) and other rights
and obligations under this Agreement and all other Loan Documents (including
Reimbursement Obligations, if applicable) to such Replacement Lender; provided,
however, that (i) such assignment shall be without recourse, representation or
warranty and shall be on terms and conditions reasonably satisfactory to such
Affected Lender and such designated financial institution, (ii) the purchase
price paid by such Replacement Lender shall be in the amount of such Affected
Lender's Loans and its Percentage of outstanding Reimbursement Obligations,
together with all accrued and unpaid interest and fees in respect thereof, plus
all other amounts (including the amounts demanded and unreimbursed under
Sections 4.3, 4.5 and 4.6), owing to such Affected Lender hereunder and (iii)
the Borrower shall pay to the Affected Lender and the Administrative Agent all
reasonable out-of-pocket expenses incurred by the Affected Lender and the
Administrative Agent in connection with such assignment and assumption
(including the processing fees described in Section 10.11.1). Upon the effective
date of an assignment described above, the Replacement Lender shall become a
"Lender" for all purposes under the Loan Documents.
SECTION 4.12. Limitation on Additional Amounts, etc. Notwithstanding
anything to the contrary contained in Sections 4.3, 4.5 or 4.6 of this
Agreement, unless a Lender gives notice to the Borrower that it is obligated to
pay an amount under any such Section within 90 days after the later of (x) the
date the Lender incurs the respective increased costs, Taxes, loss, expense or
liability, reduction in amounts received or receivable or reduction in return on
capital or (y) the date such Lender has actual knowledge of its incurrence of
their respective increased costs, Taxes, loss, expense or liability, reductions
in amounts received or receivable or reduction in return on capital, then such
Lender shall only be entitled to be compensated for such amount by such Borrower
pursuant to Sections 4.3, 4.5 or 4.6, as the case may be, to the extent the
costs, Taxes, loss, expense or liability, reduction in amounts received or
receivable or reduction in return on capital are incurred or suffered on or
after the date which occurs 90 days prior to such Lender giving notice to the
Borrower that it is obligated to pay the respective amounts pursuant to Sections
4.3, 4.5 or 4.6, as the case may be. This Section shall have no applicability to
any Section of this Agreement other than Sections 4.3, 4.5 or 4.6.
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
SECTION 5.1. Initial Credit Extension. The obligations of the Lenders
and, if applicable, the Issuers to fund the initial Credit Extension shall be
subject to the prior or concurrent satisfaction of each of the conditions
precedent set forth in this Section.
SECTION 5.1.1. Resolutions, etc. The Managing Agents shall have received
from each Obligor, as applicable, (i) a copy of a good standing certificate,
dated a date reasonably close to the Closing Date, for each such Person and (ii)
a certificate, dated the Closing Date and with counterparts for each Lender,
duly executed and delivered by such Person's Secretary or Assistant Secretary,
managing member or general partner, as applicable, as to
(a) the fact that a complete and correct copy of the resolutions of
each such Person's Board of Directors (or other managing body, in the case
of other than a corporation) then in full force and effect authorizing, to
the extent relevant, all aspects of the Transaction applicable to such
Person and the execution, delivery and performance of each Loan Document
to be executed by such Person and the transactions contemplated hereby and
thereby is attached to such certificate and that those resolutions have
not been amended, modified or rescinded by subsequent action;
(b) the incumbency and signatures of those of its officers, managing
member or general partner, as applicable, authorized to act with respect
to each Loan Document to be executed by such Person (each, an "Authorized
Officer"); and
(c) the full force and validity of each Organic Document of such
Person and copies thereof;
upon which certificates each Secured Party may conclusively rely until it shall
have received a further certificate of the Secretary, Assistant Secretary,
managing member or general partner, as applicable, of any such Person canceling
or amending the prior certificate of such Person.
SECTION 5.1.2. Transaction Consummated. The Transactions shall have been
consummated for an aggregate amount not in excess of $826,000,000, and in
connection therewith:
(a) The Recapitalization shall have been consummated pursuant to the
Recapitalization Agreement (and all of the conditions to effecting or
consummating the Recapitalization set forth in the Recapitalization
Agreement shall have been duly satisfied or, with the consent of the
Managing Agents and the Required Lenders, waived) and, pursuant thereto,
(i) the Borrower shall have received common equity proceeds
of approximately $200,000,000, and
(ii) MDCP and its designees shall have become the holder of
approximately 82.5% of the issued and outstanding OSI Common Stock,
representing more than 77% of the OSI Common Stock on a fully
diluted basis, in each case on the Closing Date.
(b) The Rollover Shareholders shall continue to hold approximately
8.0% of the issued and outstanding OSI Common Stock, representing
approximately 7.5% of the OSI Common Stock on a fully diluted basis, in
each case on the Closing Date.
(c) The Preferred Equity Issuances shall have been consummated on
terms and conditions reasonably satisfactory in all respects to the
Managing Agents and, pursuant to
(i) the PIK Preferred Equity Issuance, the Borrower shall have
issued the PIK Preferred Equity for not less than $100,000,000 in
gross cash proceeds to the PIK Preferred Equity Holders pursuant to
the PIK Preferred Equity Documents; and
(ii) the Junior PIK Preferred Equity Issuance, the Borrower
shall have issued (pursuant to the Junior PIK Preferred Equity
Documents) the Junior PIK Preferred Equity to certain of the
Existing Shareholders for not less than $7,000,000 of gross cash
proceeds, in connection with the Recapitalization.
SECTION 5.1.3. Transaction Documents. (a) The Managing Agents shall have
received (with copies for each Lender that shall have requested in writing
copies thereof) copies of fully executed versions of the Transaction Documents
other than the Consent Solicitation Statement, certified to be true and complete
copies thereof by an Authorized Officer of the Borrower. Each Material Document
shall be in full force and effect and shall not have been modified or waived in
any material respect, nor shall there have been any forbearance to exercise any
rights with respect to any of the material terms or provisions relating to the
conditions to the consummation of the Recapitalization, the Preferred Equity
Issuances and the Solicitation set forth in the applicable Material Document
unless otherwise agreed to by the Required Lenders.
(b) With respect to the Solicitation, the Managing Agents shall have
received evidence satisfactory in all respects to each of them that the
Subordinated Note Holders of at least a majority of the aggregate principal
amount of the Subordinated Notes shall have executed and delivered a consent
pursuant to the Consent Solicitation Statement, such that the terms, conditions
and waivers contained in the Consent Solicitation Statement shall be binding on
and enforceable against all of the Subordinated Note Holders.
SECTION 5.1.4. Closing Date Certificate. The Managing Agents shall have
received, with counterparts for each Lender, the Borrower Closing Date
Certificate, dated the Closing Date and duly executed and delivered by an
Authorized Officer of the Borrower, in which certificate the Borrower shall
agree and acknowledge that the statements made therein shall be deemed to be
true and correct representations and warranties in all material respects of the
Borrower as of such date, and, at the time each such certificate is delivered,
such statements shall in fact be true and correct in all material respects (it
being understood that the Borrower shall not have to certify as to any matter
set forth in this Agreement to the extent that the determination thereof is to
be made (as expressly provided for in this Agreement) by either Managing Agent
or any Lender). All documents and agreements required to be appended to the
Borrower Closing Date Certificate (including documentation evidencing that,
after giving effect to the Transaction and each other transaction contemplated
hereby (including the initial Credit Extensions hereunder), all Obligations,
including those to pay principal of and interest (including interest accruing
subsequent to the filing of, or which would have accrued but for the filing of,
a petition for bankruptcy, reorganization or similar proceeding, whether or not
allowed as a claim under such proceeding) on the Loans and Reimbursement
Obligations, and fees and expenses in connection therewith, constitute "Senior
Bank Debt" (as defined in the Subordinated Note Indenture)) shall be in form and
substance reasonably satisfactory to the Managing Agents.
SECTION 5.1.5. Delivery of Notes. The Managing Agents shall have
received, for the account of each Lender that has requested a Note in writing
three Business Days prior to the Closing Date, such Lender's Notes duly executed
and delivered by an Authorized Officer of the Borrower.
SECTION 5.1.6. Payment of Outstanding Indebtedness, etc. All Indebtedness
identified in Item 7.2.2(b) of the Disclosure Schedule (including, pursuant to
the Refinancing, all Indebtedness outstanding under the terms of the Existing
Credit Agreement (other than the Existing Letters of Credit)), together with all
interest, all prepayment premiums, if any, and other amounts due and payable
with respect thereto, shall have been paid in full from the proceeds of the
initial Credit Extension and the commitments in respect of such Indebtedness
shall have been terminated, and all Liens securing payment of any such
Indebtedness have been released and the Administrative Agent shall have received
all executed UCC termination statements (Form UCC-3) or other instruments as may
be suitable or appropriate in connection therewith.
SECTION 5.1.7. Administrative Agent's Fee Letter, Closing Fees, Expenses,
etc.
(a) The Administrative Agent shall have received the Administrative
Agent's Fee Letter, duly executed and delivered by an Authorized Officer of the
Borrower.
(b) Each Managing Agent shall have received for its own account, or for
the account of each Lender, as the case may be, all fees, costs and expenses due
and payable pursuant to Sections 3.3 and 10.3, to the extent then invoiced. The
Managing Agents shall be satisfied that the aggregate amount of fees and
expenses paid or payable in connection with the Transaction shall not exceed
$47,000,000.
SECTION 5.1.8. Financial Information; Material Adverse Change. (a) The
Managing Agents shall have received, with counterparts for each Lender,
(i) (A) consolidated financial statements of the Borrower including
balance sheets and income and cash flow statements as of the end of and
for each of the last three Fiscal Years ended December 31, 1998, December
31, 1997 and December 31, 1996 audited by independent public accountants
of recognized national standing and prepared in conformity with GAAP,
together with the report thereon; and (B) unaudited interim financial
statements of the Borrower prepared in each case in the same manner as the
historical audited statements for the first three Fiscal Quarters of the
1999 Fiscal Year and for the same Fiscal Quarters of the 1998 Fiscal Year;
and
(ii) a consolidated pro forma balance sheet of the Borrower and its
Subsidiaries, as of September 30, 1999, certified by the chief financial
or accounting Authorized Officer of the Borrower, giving effect to the
consummation of the Transaction and each other transaction contemplated by
this Agreement and the Transaction Documents, and reflecting the proposed
legal and capital structures of the Borrower and its Subsidiaries, which
legal and capital structure shall be satisfactory in all material respects
to the Managing Agents; and
(b) Since December 31, 1998, there has not been any material adverse
change in the business, operations, results of operations, business prospects or
financial condition of the Borrower and its Subsidiaries taken as a whole.
SECTION 5.1.9. Opinions of Counsel; Reliance Letters. The Managing
Agents shall have received opinions, dated the Closing Date and addressed to the
Managing Agents and all of the Lenders, from
(a) Kirkland & Ellis, New York counsel to the Obligors, in form and
substance satisfactory to the Managing Agents; and
(b) local counsel to the Obligors, in form and substance, and from
counsel, in each case satisfactory to the Managing Agents, from the States
of California, Florida, Georgia, Missouri and Wisconsin.
SECTION 5.1.10. Filing Agent, etc. All UCC financing statements (Form
UCC-1) or other similar financing statements and UCC termination statements
(Form UCC-3) required pursuant to the Loan Documents (collectively, the "Filing
Statements") shall have been delivered to CT Corporation System or another
similar filing service company acceptable to the Managing Agents (the "Filing
Agent"). The Filing Agent shall have acknowledged in a writing satisfactory to
the Managing Agents and their counsel (i) the Filing Agent's receipt of all
Filing Statements, (ii) that the Filing Statements have either been submitted
for filing in the appropriate filing offices or will be submitted for filing in
the appropriate offices within ten days following the Closing Date and (iii)
that the Filing Agent will notify the Managing Agents and their counsel of the
results of such submissions within 30 days following the Closing Date.
SECTION 5.1.11. Subsidiary Guaranty. The Managing Agents shall have
received the Subsidiary Guaranty, dated as of the Closing Date, duly executed
and delivered by an Authorized Officer of each Subsidiary Guarantor.
SECTION 5.1.12. Solvency, etc. The Managing Agents shall have received,
with counterparts for each Lender, a certificate duly executed and delivered by
the chief financial or accounting Authorized Officer of the Borrower, dated the
Closing Date, in the form of Exhibit I attached hereto.
SECTION 5.1.13. Pledge Agreements. The Managing Agents shall have
received,
(a) the Shareholders' Pledge Agreement, dated as of the Closing
Date, and duly executed and delivered by an Authorized Officer of each OSI
Shareholder that is not a natural person and each other OSI Shareholder
that is a natural person in his/her individual capacity together with the
certificates evidencing the shares of the OSI Common Stock owned by such
OSI Shareholders and pledged pursuant to the Shareholders' Pledge
Agreement, which certificates in each case shall be accompanied by undated
instruments of transfer duly executed in blank;
(b) each Pledge and Security Agreement, dated as of the Closing
Date, duly executed and delivered by an Authorized Officer of the Borrower
and each Subsidiary Guarantor together with
(i) the certificates evidencing all of the issued and
outstanding shares of Capital Securities pledged pursuant to the
Pledge and Security Agreement, which certificates in each case shall
be accompanied by undated instruments of transfer duly executed in
blank, or, if any such shares of Capital Securities pledged pursuant
to such Pledge and Security Agreement are uncertificated securities,
the Administrative Agent shall have obtained "control" (as defined
in the UCC) over such shares of Capital Securities) and such other
instruments and documents as shall be necessary or in the reasonable
opinion of the Administrative Agent desirable under applicable law
to perfect (subject to Permitted Liens) the first priority security
interest of the Administrative Agent in such shares of Capital
Securities;
(ii) executed copies of UCC financing statements (Form UCC-1)
naming each such Obligor executing a Pledge and Security Agreement
as a debtor and the Administrative Agent as the secured party, or
other similar instruments or documents to be filed under the UCC of
all jurisdictions as may be necessary or, in the opinion of the
Managing Agents and their counsel, desirable to perfect the security
interests of the Administrative Agent pursuant to such Pledge and
Security Agreement;
(iii) executed copies of proper UCC termination statements
(Form UCC-3), if any, necessary to release all Liens and other
rights of any Person (other than Permitted Liens) (i) in any
collateral described in any security agreement previously executed
and delivered by any Person, and (ii) securing any of the
Indebtedness identified in Item 7.2.2(b) of the Disclosure Schedule,
together with such other UCC termination statements (Form UCC-3) as
the Managing Agents may reasonably request from such Obligors; and
(iv) certified copies of UCC Requests for Information or
Copies (Form UCC-11), or a similar search report certified by a
party acceptable to the Managing Agents, dated a date reasonably
near to the Closing Date, listing effective financing statements
which name such Obligor (under its present name and certain of its
previous names) as the debtor and which are filed in certain of the
jurisdictions in which filings are to be made pursuant to clause
(ii) above, together with copies of such financing statements; and
The Managing Agents and their counsel shall be satisfied that (i) the Lien
granted to the Administrative Agent, for the benefit of the Secured Parties in
the Collateral (subject to Permitted Liens) is a first priority (or local
equivalent thereof) security interest, and (ii) no Lien exists on any of the
Collateral (as defined in the applicable Pledge Agreement) other than the Lien
created in favor of the Administrative Agent, for the benefit of the Secured
Parties, pursuant to a Loan Document.
SECTION 5.1.14. Patent Security Agreement, Copyright Security Agreement
and Trademark Security Agreement. The Managing Agents shall have received the
Patent Security Agreement, the Copyright Security Agreement and the Trademark
Security Agreement, as applicable, each dated as of the Closing Date, duly
executed and delivered by an Authorized Officer of each Obligor that has
delivered a Pledge and Security Agreement.
SECTION 5.1.15. Perfection Certificates. The Managing Agents shall have
received Perfection Certificates, dated as of the Closing Date, duly executed
and delivered by an Authorized Officer of the Borrower and each Subsidiary
Guarantor.
SECTION 5.1.16. Insurance. The Managing Agents shall have received
certified copies of the insurance policies (or binders in respect thereof), from
one or more insurance companies satisfactory to the Managing Agents, evidencing
coverage required to be maintained pursuant to each Loan Document.
SECTION 5.1.17. Corporate, Tax and Capital Structure. The corporate, tax,
capital and ownership structure (including Organic Documents), shareholders
agreements and the management of the Borrower both before and after the
Transaction shall be reasonably satisfactory to the Managing Agents in all
respects. The corporate and capital structure of the Borrower and its
Subsidiaries on the Closing Date shall be as set forth in Annex I hereto.
SECTION 5.1.18. Litigation. There shall exist no pending or threatened
action, suit, investigation, litigation or proceeding pending or threatened in
any court or before any arbitrator or governmental instrumentality which (a)
contests the consummation of the Transaction or the legality or validity of any
Loan Document or any Transaction Document, or (b) could reasonably be expected
to have a Material Adverse Effect.
SECTION 5.2. All Credit Extensions. The obligation of each Lender and
each Issuer to make any Credit Extension (including the initial Credit
Extension) shall be subject to the satisfaction of each of the conditions
precedent set forth below.
SECTION 5.2.1. Compliance with Warranties, No Default, etc. Both
immediately before and immediately after giving effect to any Credit Extension
(but, if any Default of the nature referred to in Section 8.1.5 shall have
occurred with respect to any other Indebtedness, without giving effect to the
application, directly or indirectly, of the proceeds thereof) the following
statements shall be true and correct:
(a) the representations and warranties set forth in each Loan
Document shall, in each case, be true and correct in all material respects
with the same effect as if then made (unless stated to relate solely to an
earlier date, in which case such representations and warranties shall be
true and correct in all material respects as of such earlier date); and
(b) no Default shall have then occurred and be continuing.
SECTION 5.2.2. Credit Extension Request, etc. The Administrative Agent
shall have received a Borrowing Request if Loans are being requested, or an
Issuance Request if a Letter of Credit is being requested or extended. Each of
the delivery of a Borrowing Request or Issuance Request and the acceptance by
the Borrower of the proceeds of such Credit Extension shall constitute a
representation and warranty by the Borrower that on the date of such Credit
Extension (both immediately before and after giving effect to such Credit
Extension and the application of the proceeds thereof) the statements made in
Section 5.2.1 are true and correct in all material respects.
SECTION 5.2.3. Satisfactory Legal Form. All documents executed or
submitted pursuant hereto by or on behalf of any Obligor shall be reasonably
satisfactory in form and substance to the Managing Agents and their counsel. The
Managing Agents and their counsel shall have received all information,
approvals, opinions, documents or instruments as either Managing Agent or its
counsel may reasonably request, if the Managing Agents believe in good faith
that a Default may have occurred and is continuing.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Secured Parties a party hereto to enter into this
Agreement and to make Credit Extensions hereunder, the Borrower represents and
warrants to each Secured Party a party hereto as set forth in this Article.
SECTION 6.1. Organization, etc. Each Obligor (i) is validly organized and
existing and in good standing under the laws of the state or jurisdiction of its
incorporation or organization, (ii) is duly qualified to do business and is in
good standing as a foreign entity in each jurisdiction where the nature of its
business requires such qualification (except where the failure to be so
qualified or in good standing as a foreign entity could not reasonably be
expected to have a Material Adverse Effect), and (iii) has full power and
authority and holds all requisite governmental licenses, permits and other
approvals to enter into and perform its Obligations under each Loan Document to
which it is a party and to own and hold under lease its property and to conduct
its business substantially as currently conducted by it (except where the
failure to hold any such licenses, permits or other approvals could not
reasonably be expected to have a Material Adverse Effect).
SECTION 6.2. Due Authorization, Non-Contravention, etc. The execution,
delivery and performance by each Obligor of each Loan Document executed or to be
executed by it, each such Obligor's participation in the consummation of all
aspects of the Transaction, and the execution, delivery and performance by such
Obligor of the agreements executed and delivered by it in connection with the
Transaction are in each case within each such Person's powers, have been duly
authorized by all necessary action, and do not
(a) contravene any (i) Obligor's Organic Documents, (ii) contractual
restriction binding on or affecting any Obligor (other than any such
contractual restriction that shall have been waived on or prior to the
Closing Date or the failure to obtain thereof could not reasonably be
expected to have a Material Adverse Effect or that which will not lead to
any liability by a Secured Party), (iii) court decree or order binding on
or affecting any Obligor or (iv) law or governmental regulation binding on
or affecting any Obligor; or
(b) result in, or require the creation or imposition of, any Lien on
any Obligor's properties (except as permitted or required by this
Agreement).
SECTION 6.3. Government Approval, Regulation, etc. No authorization or
approval or other action by, and no notice to or filing with, any Governmental
Authority or other Person (other than those which (i) have been, or on the
Closing Date will be, duly obtained or made or waived and which are, or on the
Closing Date will be, in full force and effect or (ii) the failure to obtain or
make could not reasonably be expected to have a Material Adverse Effect) is
required for the consummation of the Transaction or the due execution, delivery
or, to the extent applicable, performance by any Obligor of any Loan Document to
which it is a party, or for the due execution, delivery and/or, to the extent
applicable, performance of the Transaction Documents, in each case by the
parties thereto or the consummation of the Transaction. Neither the Borrower nor
any of its Subsidiaries is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or a "holding company", or a
"subsidiary company" of a "holding company", or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company", within the meaning
of the Public Utility Holding Company Act of 1935, as amended.
SECTION 6.4. Validity, etc. Each Loan Document and each Transaction
Document (other than the Consent Solicitation) to which each Obligor is a party
constitute, or will, on the due execution and delivery thereof by such Obligor,
constitute, the legal, valid and binding obligations of such Obligor,
enforceable against it in accordance with its terms (except, in any case, as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally and by
principles of equity).
SECTION 6.5. Financial Information. (a) The financial statements of the
Borrower and its Subsidiaries furnished to the Managing Agents and each Lender
pursuant to Section 5.1.8(a)(i) have been prepared in accordance with GAAP
consistently applied, and present fairly in all material respects the
consolidated financial condition of the Persons covered thereby as at the dates
thereof and the results of their operations for the periods then ended.
(b) The pro forma balance sheets furnished to the Agents and each Lender
pursuant to Section 5.1.8(a)(ii) fairly presents in all material respects the
pro forma estimated financial condition of the Borrower as of such date.
(c) All balance sheets, all statements of operations, shareholders' equity
and cash flow and all other financial information (other than projections) of
each of the Borrower and its Subsidiaries furnished pursuant to Section 7.1.1
have been and will for periods following the Closing Date be prepared in
accordance with GAAP consistently applied, and do or will present fairly in all
material respects the consolidated financial condition of the Persons covered
thereby as at the dates thereof and the results of their operations for the
periods then ended.
SECTION 6.6. No Material Adverse Change. There has been no material
adverse change in the business, operations, results of operations, business
prospects which could reasonably be expected to result in a Default, or
financial condition of the Borrower and its Subsidiaries taken as a whole since
December 31, 1998.
SECTION 6.7. Litigation, Labor Controversies, etc. There is no pending
or, to the knowledge of the Borrower or any of its Subsidiaries, threatened
litigation, action, proceeding or labor controversy
(a) except as disclosed in Item 6.7 of the Disclosure Schedule,
affecting the Borrower or any such Subsidiary or any of their respective
properties, businesses, assets or revenues, which could reasonably be
expected to have a Material Adverse Effect, and no adverse development has
occurred in any labor controversy, litigation, arbitration or governmental
investigation or proceeding disclosed in Item 6.7; or
(b)which purports to affect the legality, validity or
enforceability of any Loan Document, any Transaction Document or the
Transaction.
SECTION 6.8. Subsidiaries. The Borrower has no Subsidiaries except
those Subsidiaries
(a) existing on the Closing Date which are identified in Item 6.8 of
the Disclosure Schedule; or
(b) which are permitted to have been organized or acquired in
accordance with Section 7.2.5 or 7.2.10.
Item 6.8 of the Disclosure Schedule (a) lists, with respect to each Subsidiary,
(i) the state or jurisdiction of such Subsidiary's incorporation or organization
and (ii) the percentage of shares or interests of the Capital Securities of such
Subsidiary owned by the Borrower or another Subsidiary, and (b) identifies each
Subsidiary which is a Foreign Subsidiary.
SECTION 6.9. Ownership of Properties; Capital Securities. (a) The
Borrower and each of its Subsidiaries owns (i) in the case of owned real
property, good and marketable fee title to, and (ii) in the case of owned
personal property, good and valid title to, or, in the case of leased real or
personal property, valid and enforceable leasehold interests (as the case may
be) in, all of its properties and assets, real and personal, tangible and
intangible, of any nature whatsoever, free and clear in each case of all Liens
or claims, except for Permitted Liens.
(b) All of the issued and outstanding shares of OSI Common Stock and all
of the issued and outstanding shares of Capital Securities of each of the
Pledged Subsidiaries are, in each case, duly authorized and validly issued,
fully paid and non-assessable.
SECTION 6.10. Taxes. Each of the Borrower and its Subsidiaries has filed
all Federal, State and other material Tax returns and reports required by law to
have been filed by it and has paid all Taxes and governmental charges thereby
shown to be due and owing, except any such Taxes or charges which are being
diligently contested in good faith by appropriate proceedings and for which
adequate reserves in accordance with GAAP shall have been set aside on its
books.
SECTION 6.11. Pension and Welfare Plans. During the twelve-
consecutive-month period prior to the Closing Date and prior to the date of any
Credit Extension hereunder, no steps have been taken to terminate any Pension
Plan, and no contribution failure has occurred with respect to any Pension Plan
sufficient to give rise to a Lien under Section 302(f) of ERISA. No condition
exists or event or transaction has occurred with respect to any Pension Plan
which might result in the incurrence by the Borrower or any member of the
Controlled Group of any material liability, fine or penalty. Except as disclosed
in Item 6.11 of the Disclosure Schedule, neither the Borrower nor any member of
the Controlled Group has any contingent liability with respect to any
post-retirement benefit under a Welfare Plan, other than liability for
continuation coverage described in Part 6 of Title I of ERISA.
SECTION 6.12. Environmental Warranties. Except as, singly or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect:
(a) all facilities and property (including underlying groundwater)
owned or leased by the Borrower or any of its Subsidiaries have been, and
continue to be, owned or leased by the Borrower and its Subsidiaries in
compliance with all Environmental Laws;
(b) there have been no past, and there are no pending or threatened
(i) written claims, complaints, notices or requests for information
received by the Borrower or any of its Subsidiaries with respect to any
alleged violation of any Environmental Law, or (ii) written complaints,
notices or inquiries to the Borrower or any of its Subsidiaries regarding
potential liability under any Environmental Law;
(c) there have been no Releases of Hazardous Materials at, on or
under any property now or previously owned or leased by the Borrower or
any of its Subsidiaries;
(d) the Borrower and its Subsidiaries have been issued and are in
compliance with all permits, certificates, approvals, licenses and other
authorizations relating to environmental matters and necessary or
desirable for their businesses;
(e) no property now or previously owned or leased by the Borrower or
any of its Subsidiaries is listed or proposed for listing (with respect to
owned property only) on the National Priorities List pursuant to CERCLA,
on the CERCLIS or on any similar state list of sites requiring
investigation or clean-up;
(f) there are no underground storage tanks, active or abandoned,
including petroleum storage tanks, on or under any property now or
previously owned or leased by the Borrower or any of its Subsidiaries;
(g) neither the Borrower nor any Subsidiary has directly transported
or directly arranged for the transportation of any Hazardous Material to
any location which is listed or proposed for listing on the National
Priorities List pursuant to CERCLA, on the CERCLIS or on any similar state
list or which is the subject of federal, state or local enforcement
actions or other investigations which may lead to material claims against
the Borrower or such Subsidiary for any remedial work, damage to natural
resources or personal injury, including claims under CERCLA;
(h) there are no polychlorinated biphenyls or friable asbestos
present at any property now or previously owned or leased by the Borrower
or any Subsidiary; and
(i) no conditions exist at, on or under any property now or
previously owned or leased by the Borrower which, with the passage of
time, or the giving of notice or both, would give rise to liability under
any Environmental Law.
SECTION 6.13. Accuracy of Information. None of the factual information
heretofore or contemporaneously furnished in writing to any Secured Party and
prepared by or on behalf of any Obligor in connection with any Loan Document or
any transaction contemplated hereby (including the Transaction) contains as of
the date made any untrue statement of a material fact, or omits to state any
material fact necessary to make any such factual information not misleading, and
no other factual information hereafter furnished in connection with any Loan
Document by or on behalf of any Obligor in writing to any Secured Party will
contain as of the date made any untrue statement of a material fact or will omit
to state any material fact necessary to make any such factual information not
misleading on the date as of which such factual information is dated or
certified.
SECTION 6.14. Regulations U and X. Neither the Borrower nor any of its
Subsidiaries is engaged in the business of extending credit for the purpose of
purchasing or carrying margin stock, and no proceeds of any Credit Extensions
will be used to purchase or carry margin stock or otherwise for a purpose which
violates, or would be inconsistent with, Board Regulation U or Regulation X.
Terms for which meanings are provided in Board Regulation U or Regulation X or
any regulations substituted therefor, as from time to time in effect, are used
in this Section with such meanings.
SECTION 6.15. Year 2000. Each Obligor has developed a program to address
on a timely basis, the "Year 2000 Problem" (that is, the risk that computer
applications used by such Obligor may be unable to recognize and properly
perform date-sensitive functions involving certain dates prior to and any date
after December 31, 1999). Based on such program, the Year 2000 Problem could not
reasonably be expected to have a Material Adverse Effect.
SECTION 6.16. Status of Obligations as Senior Indebtedness, etc. The
subordination provisions relating to the Subordinated Debt (including the
subordination provisions set forth in the Subordinated Note Indenture) are
enforceable against the holders of the applicable Subordinated Debt by the
holder of any "Senior Bank Debt" (as defined in the Subordinated Note Indenture)
or any similar term referring to the Obligations (as defined in any other
Subordinated Debt Document). All Obligations (including those to pay principal
of and interest (including interest accruing subsequent to the filing of, or
which would have accrued but for the filing of, a petition for bankruptcy,
reorganization or similar proceeding, whether or not allowed as a claim under
such proceeding) on the Loans and Reimbursement Obligations, and fees and
expenses in connection therewith) constitute "Senior Bank Debt" (as defined in
the Subordinated Note Indenture) or any similar term referring to the
Obligations (as defined in any other Subordinated Debt Document) and all such
Obligations are entitled to the benefits of the subordination created by such
Subordinated Debt Documents. The Borrower acknowledges that the Managing Agents,
each Lender and each Issuer are entering into this Agreement and are extending
their respective Commitments in reliance upon the subordination provisions of
the Subordinated Debt Documents (including the subordination provisions set
forth in the Subordinated Note Indenture).
SECTION 6.17. Solvency. The Transaction (including the incurrence of the
initial Credit Extension hereunder, and the execution and delivery by the
Subsidiary Guarantors of the Subsidiary Guaranty) will not involve or result in
any fraudulent transfer or fraudulent conveyance under the provisions of Section
548 of the Bankruptcy Code (11 U.S.C. ss.101 et seq., as from time to time
hereafter amended, and any successor or similar statute) or any applicable state
law relating to fraudulent transfers or fraudulent conveyances. After giving
effect to each Credit Extension hereunder, the Borrower and each Subsidiary
Guarantor is Solvent.
ARTICLE VII
COVENANTS
SECTION 7.1. Affirmative Covenants. The Borrower covenants and agrees
with each of the Secured Parties that from the Closing Date until the
Termination Date has occurred, the Borrower will, and will cause its
Subsidiaries to, perform or cause to be performed the obligations set forth
below.
SECTION 7.1.1. Financial Information, Reports, Notices, etc. The
Borrower will furnish, or cause to be furnished, to the Managing Agents (with
sufficient copies for each Lender) copies of the following financial statements,
reports, notices and information:
(a) as soon as available and in any event within 60 days after the
end of each of the first three Fiscal Quarters of each Fiscal Year, an
unaudited consolidated balance sheet of the Borrower and its Subsidiaries
as of the end of such Fiscal Quarter and consolidated statements of income
and cash flow of the Borrower and its Subsidiaries for such Fiscal Quarter
and for the period commencing at the end of the previous Fiscal Year and
ending with the end of such Fiscal Quarter, and including (in each case),
in comparative form the figures for the corresponding Fiscal Quarter in,
and year to date portion of, the immediately preceding Fiscal Year,
certified as complete and correct by the chief financial or accounting
Authorized Officer of the Borrower;
(b) as soon as available and in any event within 105 days after the
end of each Fiscal Year, a copy of the consolidated balance sheets of the
Borrower and its Subsidiaries, and the related consolidated statements of
income and cash flow of the Borrower and its Subsidiaries for such Fiscal
Year, setting forth in comparative form the figures for the immediately
preceding Fiscal Year and, in the case of such consolidated balance sheets
and statements of income and cash flow, audited (without any Impermissible
Qualification) by a "Big Five" accounting firm or any other independent
public accountants acceptable to the Managing Agents, which shall include
a calculation of the financial covenants set forth in Section 7.2.4 and
stating that, in performing the examination necessary to deliver the
audited financial statements of the Borrower and its Subsidiaries, no
knowledge was obtained of any Event of Default;
(c) concurrently with the delivery of the financial information
pursuant to clauses (a) and (b), a Compliance Certificate, executed by the
chief financial or accounting Authorized Officer of the Borrower, showing
compliance with the financial covenants set forth in Section 7.2.4 and
stating that no Default has occurred and is continuing (or, if a Default
has occurred, specifying the details of such Default and the action that
the Borrower or an Obligor has taken or proposes to take with respect
thereto);
(d) as soon as possible and in any event within five days after the
Borrower or any Subsidiary obtains knowledge of the occurrence of a
Default, a statement of an Authorized Officer of the Borrower setting
forth details of such Default and the action which the Borrower or such
Subsidiary has taken and proposes to take with respect thereto;
(e) as soon as possible and in any event within five days after the
Borrower or any Subsidiary obtains knowledge of (i) the occurrence of any
material adverse development with respect to any litigation, action,
proceeding or labor controversy described in Item 6.7 of the Disclosure
Schedule or (ii) the commencement of any litigation, action, proceeding or
labor controversy of the type and materiality described in Section 6.7,
notice thereof and, to the extent either Managing Agent requests, copies
of all documentation relating thereto;
(f) promptly after the sending or filing thereof, copies of all
reports, notices, prospectuses and registration statements which the
Borrower or any Subsidiary files with the SEC or any national securities
exchange;
(g) immediately upon becoming aware of (i) the institution of any
steps by any Person to terminate any Pension Plan, (ii) the failure to
make a required contribution to any Pension Plan if such failure is
sufficient to give rise to a Lien under Section 302(f) of ERISA, (iii) the
taking of any action with respect to a Pension Plan which could result in
the requirement that any Obligor furnish a bond or other security to the
PBGC or such Pension Plan, or (iv) the occurrence of any event with
respect to any Pension Plan which could result in the incurrence by any
Obligor of any material liability, fine or penalty, notice thereof and
copies of all documentation relating thereto;
(h) promptly upon receipt thereof, copies of all "management
letters" submitted to any Obligor by the independent public accountants
referred to in clause (b) in connection with each audit made by such
accountants;
(i) promptly following the mailing or receipt of any notice or
report delivered under the terms of any Preferred Equity or any
Subordinated Debt Documents, copies of such notice or report; and
(j) such other financial and other information as any Lender or
Issuer through either Managing Agent may from time to time reasonably
request (including information and reports in such detail as either
Managing Agent may request with respect to the terms of and information
provided pursuant to the Compliance Certificate).
SECTION 7.1.2. Maintenance of Existence; Compliance with Laws, etc. The
Borrower will
(a) preserve and maintain its legal existence and qualification as a
foreign corporation in each jurisdiction where the nature of its business
or the location of its assets requires it to be so qualified, except to
the extent the failure to be so qualified would not result in a Material
Adverse Effect;
(b) cause each of its Subsidiaries to, except as otherwise permitted
by Section 7.2.10, preserve and maintain its legal existence and
qualification as a foreign entity in each jurisdiction where the nature of
its business or the location of its assets requires it to be so qualified,
except to the extent the failure to be so qualified would not result in a
Material Adverse Effect; and
(c) comply with all applicable laws, rules, regulations and orders,
including the payment (before the same become delinquent) of all material
Taxes imposed upon the Borrower or any Subsidiary or upon their property
except to the extent being diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with
GAAP have been set aside on the books of the Borrower or any such
Subsidiary, as applicable, except to the extent the failure to comply with
all such laws rules, regulations and orders (other than any relating to
the payment of material Taxes) would not result in a Material Adverse
Effect.
SECTION 7.1.3. Maintenance of Properties. Except to the extent the
failure to do so could not reasonably be expected to have a Material Adverse
Effect, the Borrower will, and will cause each of its Subsidiaries to, maintain,
preserve, protect and keep its and their respective properties in good repair,
working order and condition (ordinary wear and tear excepted), and make
necessary repairs, renewals and replacements so that the business carried on by
the Borrower and its Subsidiaries may be properly conducted at all times, unless
the Borrower or such Subsidiary determines that the continued maintenance of
such property is no longer economically desirable.
SECTION 7.1.4. Insurance. The Borrower will, and will cause each of
its Subsidiaries to maintain:
(a) insurance on its property with financially sound and reputable
insurance companies against loss and damage in at least the amounts (and
with only those deductibles) customarily maintained, and against such
risks as are typically insured against in the same general area, by
Persons of comparable size engaged in the same or similar business as the
Borrower and its Subsidiaries; and
(b) all worker's compensation, employer's liability insurance or
similar insurance as may be required under the laws of any state or
jurisdiction in which it may be engaged in business.
Without limiting the foregoing, all insurance policies required pursuant to this
Section shall (i) name the Administrative Agent on behalf of the Secured Parties
as mortgagee (in the case of property insurance) or additional insured (in the
case of liability insurance), as applicable, and provide that no cancellation or
modification of the policies will be made without thirty days' prior written
notice to the Administrative Agent.
SECTION 7.1.5. Books and Records. (a) The Borrower will, and will
cause each of its Subsidiaries to,
(i) keep books and records in accordance with GAAP which
accurately reflect all of its business affairs and transactions;
(ii) permit the Managing Agents or any of their respective
representatives, at reasonable times and intervals and upon reasonable
notice to the Borrower to visit each of the Borrower's and its
Subsidiaries' offices, to discuss such Person's financial matters with its
officers and employees, and its independent public accountants (and the
Borrower hereby authorizes such independent public accountant to discuss
each of such Person's financial matters with the Managing Agents or any of
their respective representatives whether or not any representative of such
Person is present, so long as a representative of such Person has been
afforded a reasonable opportunity to be present) and to examine (and
photocopy extracts from) any of such Person's books and records; and
(iii) afford each other Secured Party or any of its respective
representatives the opportunity to visit the Borrower's and its
Subsidiaries' offices once per calendar year (such date to be determined
by the Borrower and each such Secured Party to be given reasonable notice
thereof), to discuss such Person's financial matters with its officers and
employees, and its independent public accountants (and the Borrower hereby
authorizes such independent public accountant to discuss each of such
Person's financial matters with each such Secured Party or any of their
respective representatives whether or not any representative of such
Person is present, so long as a representative of such Person has been
afforded a reasonable opportunity to be present) and to examine (and
photocopy extracts from) any of such Person's books and records; provided,
however, that each such Secured Party or any of their respective
representatives, at reasonable times and intervals and upon reasonable
notice to the Borrower, shall be permitted to do any of the foregoing at
any time after the occurrence and during the continuation of an Event of
Default.
(b) If an Event of Default shall have occurred and be continuing, the
Borrower shall pay any fees of such independent public accountant incurred in
connection with any Secured Party's exercise of its rights pursuant to clause
(a).
SECTION 7.1.6. Environmental Law Covenant. The Borrower will, and will
cause each of its Subsidiaries to,
(a) use and operate all of its facilities and properties in
compliance with all Environmental Laws, keep all necessary material
permits, approvals, certificates, licenses and other authorizations
relating to environmental matters in effect and remain in compliance
therewith, and handle all Hazardous Materials in compliance with all
applicable Environmental Laws, in each case except where the failure to
comply with the terms of this clause could not reasonably be expected to
have a Material Adverse Effect; and
(b) promptly notify the Administrative Agent and provide copies upon
receipt of all written claims, complaints, notices or inquiries which (i)
relate to the condition of its facilities and properties in respect of, or
as to compliance with, Environmental Laws and (ii) could (singly or in the
aggregate) reasonably be expected to have a Material Adverse Effect, and
shall promptly resolve any non-compliance with Environmental Laws (except
to the extent being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP have
been set aside on its books or except for any such non-compliance which
could not reasonably be expected to have a Material Adverse Effect) and
keep its property free of any material Lien imposed by any Environmental
Law.
SECTION 7.1.7. Use of Proceeds. The Borrower will
(a) apply the proceeds of the Term Loans to refinance Indebtedness
and other amounts owing under the Existing Credit Agreement and to
partially finance the consummation of the Transaction;
(b) apply the proceeds of the Revolving Loans (i) to refinance
Indebtedness and other amounts owing under the Existing Credit Agreement
and to partially finance the consummation of the Transaction with
Borrowings of Revolving Loans on the Closing Date in an amount not to
exceed $7,000,000 and (ii) for post-closing working capital and general
corporate purposes of the Borrower and the Subsidiary Guarantors (other
than UAS); and
(c) use Letters of Credit only for purposes of supporting working
capital and general corporate purposes of the Borrower and the Subsidiary
Guarantors (other than UAS).
SECTION 7.1.8. Subsidiary Guarantors, Security, etc. The Borrower will,
and will cause each Subsidiary Guarantor to, execute any documents, Perfection
Certificates, Filing Statements, agreements and instruments, and take all
further action (including filing Mortgages, to the extent required under Section
7.1.12) that may be required under applicable law, or that either Managing Agent
may reasonably request, in order to effectuate the transactions contemplated by
the Loan Documents and in order to grant, preserve, protect and perfect the
perfection and priority of the Liens created or intended to be created by the
Loan Documents. Unless otherwise agreed to by the Required Lenders, the Borrower
will cause any subsequently acquired or organized Domestic Subsidiary (other
than any OSIFC Family Member) to execute a Subsidiary Guaranty (or a supplement
thereto) and each applicable Loan Document in favor of the Secured Parties. In
addition, from time to time, the Borrower will, at its cost and expense,
promptly secure the Obligations by pledging or creating, or causing to be
pledged or created, perfected Liens with respect to such of its assets and
properties as either Managing Agent or the Required Lenders shall designate (it
being understood that it is the intent of the parties that the Obligations shall
be secured by, among other things, substantially all the assets of the Borrower
and (unless otherwise agreed to by the Required Lenders) the Subsidiary
Guarantors (including, subject to Section 7.1.12, real and personal property
acquired subsequent to the Closing Date); provided, that (i) neither the
Borrower nor any such Subsidiary shall be required to pledge more than 65% of
the Voting Securities of any Foreign Subsidiary, (ii) following a Public
Offering or a series of Public Offerings in which the Borrower shall have
received in the aggregate no less than $100,000,000 in net cash proceeds, and so
long as no Default shall have occurred and is then continuing, the Required
Lenders may elect to release the OSI Common Stock (together with the guarantee
obligations related thereto from the OSI Shareholders) held in pledge under the
Shareholders' Pledge Agreement and (iii) following the release of its
obligations as a guarantor (and for so long as it is not a guarantor) under the
Subordinated Debt Documents, and if no Default shall have occurred and is
continuing, (A) UAS shall be released from its obligations as a "Subsidiary
Guarantor" under the Subsidiary Guaranty and (B) any Collateral (as such term is
defined in the Subsidiary Pledge and Security Agreement) which has been pledged
by UAS pursuant to the Subsidiary Pledge and Security Agreement shall be
released, in each case without any action on the part of any other party. Such
Liens will be created under the Loan Documents in form and substance reasonably
satisfactory to the Administrative Agent, and the Borrower shall deliver, or
cause to be delivered, to the Lenders all such instruments and documents
(including legal opinions, title insurance policies and lien searches) as the
Administrative Agent shall reasonably request to evidence compliance with this
Section.
SECTION 7.1.9. Hedging Obligations. Within seven months following the
Closing Date, the Administrative Agent shall have received evidence satisfactory
to it that the Borrower has entered into interest rate swap, cap, collar or
similar arrangements (including such Indebtedness accruing interest at a fixed
rate by its terms) designed to protect the Borrower against fluctuations in
interest rates with respect to at least $150,000,000 of the aggregate principal
amount of the Term Loans for a period of at least three years from the Closing
Date, with terms reasonably satisfactory to the Borrower and the Administrative
Agent.
SECTION 7.1.10. Year 2000. (a) The Borrower shall take all action
reasonably necessary to assure that its computer based systems are able to
effectively process data including dates on and after January 1, 2000. At the
reasonable request of either Managing Agent or any Lender, the Borrower shall
provide such Person with assurance reasonably acceptable to such Person of the
Borrower's Year 2000 capability.
(b) The Borrower will promptly notify the Administrative Agent in the
event the Borrower discovers or determines that any computer application
(including those of its suppliers and vendors) that is material to its or any of
its Subsidiaries' businesses and operations will not be Year 2000 compliant as
of January 1, 2000, except to the extent that such failure could not reasonably
be expected to have a Material Adverse Effect.
SECTION 7.1.11. Maintenance of Corporate Separateness. The Borrower
will, and will cause each of its Subsidiaries to, satisfy customary corporate
formalities, including the holding of regular board of directors' and
shareholders' meetings and the maintenance of corporate offices and records.
Neither the Borrower nor any Subsidiary which is not an OSIFC Family Member
shall make any payment to a creditor of any OSIFC Family Member in respect of
any liability of such OSIFC Family Member (unless such payment is pursuant to
the Permitted Receivables Transaction and otherwise specifically permitted by
any Loan Document), and no bank account of any OSIFC Family Member shall be
commingled with any bank account of the Borrower or any of its Subsidiaries
which is not an OSIFC Family Member. Any financial statements distributed to any
creditors of any OSIFC Family Member shall clearly establish the separateness of
such OSIFC Family Member from the Borrower and its Subsidiaries which are not
OSIFC Family Members and each lender to an OSIFC Family Member shall be notified
in writing by such OSIFC Family Member that such lender will not have any
recourse to the assets of the Borrower and its Subsidiaries which are not OSIFC
Family Members. Neither the Borrower nor any of its Subsidiaries shall take any
action, or conduct its affairs in a manner, which is likely to result in the
corporate existence of any OSIFC Family Member which is a direct Subsidiary of
the Borrower or any Subsidiary which is not an OSIFC Family Member being ignored
by any court of competent jurisdiction, or in the assets and liabilities of the
Borrower or any Subsidiary which is not an OSIFC Family Member being
substantively consolidated with those of any OSIFC Family Member in a
bankruptcy, reorganization or other insolvency proceeding.
SECTION 7.1.12. Existing and Future Owned Real Property. (a) Within 30
days after the Closing Date, the Borrower shall deliver to the Administrative
Agent, as mortgagee for the ratable benefit of the Secured Parties, counterparts
of each Mortgage relating to each piece of real property owned by the Borrower
or any Subsidiary Guarantor (other than any such real property that has a net
book value of less than $1,500,000), each dated as of the date of such delivery,
duly executed by the Borrower or such Subsidiary Guarantor, together with
(i) evidence of the completion (or satisfactory arrangements for the
completion) of all recordings and filings of such Mortgage as may be
necessary or, in the reasonable opinion of the Administrative Agent,
desirable effectively to create a valid, perfected first priority Lien,
subject to Permitted Liens, against the properties purported to be covered
thereby;
(ii) mortgagee's title insurance policies in favor of the
Administrative Agent, as mortgagee for the ratable benefit of the Secured
Parties, in amounts and in form and substance and issued by insurers, in
each case reasonably satisfactory to the Administrative Agent, with
respect to the property purported to be covered by such Mortgage, insuring
that title to such property is marketable and that the interests created
by the Mortgage constitute valid first Liens thereon free and clear of all
defects and encumbrances other than Permitted Liens, and such policies
shall also include, to the extent available, a revolving credit
endorsement and such other endorsements as the Administrative Agent shall
reasonably request and shall be accompanied by evidence of the payment in
full of all premiums thereon; and
(iii) such other approvals, opinions or documents as the
Administrative Agent may reasonably request.
(b) At all times after the Closing Date, the Borrower shall, and shall
cause each Subsidiary Guarantor to, execute and deliver or cause to be executed
and delivered Mortgages that may be necessary to create a valid, first priority
perfected Lien (subject only to Permitted Liens) against any real property
acquired from time to time by the Borrower or any such Subsidiary Guarantor
(other than any such real property that has a net book value of less than
$1,000,000), together with the appropriate items described in clauses (a)(i)
through (a)(iii) above.
SECTION 7.1.13. Permitted Receivables Transaction. The Borrower will
cause the Subsidiaries comprising the OSIFC Family to maintain in effect the
Permitted Receivables Transaction in effect on the Closing Date or,
alternatively, upon the termination by the Borrower, or receipt of written
notice (or such other form of notice otherwise permitted to be given under the
terms of the then effective Receivables Documents) of termination from MBIA
Insurance Corporation (or such other entity serving in a similar capacity as
MBIA Insurance Corporation under the then effective Receivables Documents) by
the Borrower, the Borrower will,
(a) within 45 days of the termination or receipt of notice of
termination, as the case may be, of the Permitted Receivables Transaction
then in effect, deliver to the Managing Agents a detailed summary (the
"Summary") of terms and conditions with respect to another program (the
"Alternative Receivables Program") providing for the sale or financing of
Accounts with customary limited recourse based on the collectability of
the Accounts sold, which Summary shall be satisfactory to the Managing
Agents and indicate that the Alternative Receivables Program shall be,
upon the consummation thereof, substantially similar to the Permitted
Receivables Transaction (including the Receivables Documents evidencing
such Permitted Receivables Transaction) being replaced, and in an amount
of not less than that in effect on the Closing Date; and
(b) within 90 days of the termination or receipt of notice of
termination, as the case may be, of the Permitted Receivables Transaction
then in effect, cause the Subsidiaries comprising the OSIFC Family to
consummate the Alternative Receivables Program on the terms and conditions
set forth in the Summary, which terms and conditions shall not have been
modified or waived in any material respect unless otherwise agreed to by
the Managing Agents.
SECTION 7.2. Negative Covenants. The Borrower covenants and agrees with
each of the Secured Parties that from the Closing Date until the Termination
Date has occurred, the Borrower will not, and will not permit its Subsidiaries
to, perform or cause to be performed the obligations set forth below.
SECTION 7.2.1. Business Activities. The Borrower will not, and will not
permit any of its Subsidiaries to, engage in any business other than the
business of the Borrower and its Subsidiaries on the Closing Date, and any other
business reasonably related, ancillary or complementary thereto.
SECTION 7.2.2. Indebtedness. The Borrower will not, and will not permit
any of its Subsidiaries to, create, incur, assume or permit to exist any
Indebtedness, other than:
(a) Indebtedness in respect of the Obligations;
(b) until the Closing Date, Indebtedness that is to be repaid in
full which is identified in Item 7.2.2(b) of the Disclosure Schedule;
(c) Indebtedness existing as of the Closing Date which is identified
in Item 7.2.2(c) of the Disclosure Schedule, and Permitted Refinancings of
such Indebtedness;
(d) (i) unsecured Indebtedness of the Borrower and its Subsidiaries
(A) incurred in the ordinary course of business of the Borrower and its
Subsidiaries (including open accounts extended by suppliers on normal
trade terms in connection with purchases of goods and services which are
not overdue for a period of more than 90 days or, if overdue for more than
90 days, as to which a dispute exists and adequate reserves in conformity
with GAAP have been established on the books of the Borrower or such
Subsidiary) and (B) in respect of performance, surety, statutory, appeal
bonds or similar obligations provided in the ordinary course of business,
but excluding (in each case), Indebtedness incurred through the borrowing
of money or Contingent Liabilities in respect thereof, and (ii)
Indebtedness constituting Specified Liabilities, which Indebtedness may,
to the extent permitted by clause (w) of Section 7.2.3, be secured;
(e) Indebtedness of the Borrower and its Subsidiaries (i) in respect
of industrial revenue bonds or other similar governmental or municipal
bonds, (ii) incurred to finance the acquisition of equipment or other
property of the Borrower and its Subsidiaries (pursuant to purchase money
mortgages or otherwise, whether owed to the seller or a third party) used
in the ordinary course of business of the Borrower and its Subsidiaries
(provided, that such Indebtedness is incurred within 60 days of the
acquisition of such property) and (iii) Capitalized Lease Liabilities;
provided, that the aggregate amount of all Indebtedness outstanding
pursuant to this clause (e) shall not at any time exceed $15,000,000;
(f) Indebtedness of any Subsidiary which is not an OSIFC Family
Member owing to the Borrower or any other Subsidiary which is not an OSIFC
Family Member, which Indebtedness
(i) shall, if payable to the Borrower or a Subsidiary
Guarantor, be evidenced by one or more Intercompany Notes, duly
executed and delivered in pledge to the Administrative Agent
pursuant to the applicable Pledge and Security Agreement, and shall
not be forgiven or otherwise discharged for any consideration other
than payment in cash (provided, that only the amount repaid shall be
discharged); and
(ii) if incurred by a Non-Guarantor owing to the Borrower or a
Subsidiary Guarantor, shall not (when aggregated with the amount of
Investments made by the Borrower and the Subsidiary Guarantors in
Non-Guarantors under clause (e)(i) of Section 7.2.5) exceed
$3,000,000 at any time outstanding;
(g) unsecured Indebtedness (not evidenced by a note or other
instrument) of the Borrower owing to a Subsidiary that has previously
executed and delivered to the Administrative Agent the Interco
Subordination Agreement (or a supplement thereto);
(h) unsecured Subordinated Debt of the Borrower evidenced by the
Subordinated Notes incurred pursuant to the terms of the Subordinated Debt
Documents in a principal amount not to exceed $100,000,000, and unsecured
Contingent Liabilities of the Subsidiary Guarantors in respect of such
Subordinated Debt, but only if such Contingent Liabilities are
subordinated to the Obligations on substantially the same terms as such
Subordinated Debt of the Borrower is subordinated to the Obligations and,
in each case, Permitted Refinancings of such Subordinated Debt and
Contingent Liabilities which continue to satisfy the terms of the
definition of "Subordinated Debt";
(i) Indebtedness of a Person existing at the time such Person became
a Subsidiary of the Borrower, together with all Indebtedness assumed by
the Borrower or any Subsidiary in connection with any Permitted
Acquisition (including any Permitted Acquisition of assets), in an
aggregate amount not to exceed $15,000,000 at any time outstanding, but
only to the extent that such Indebtedness was not created or incurred in
contemplation of such Person becoming a Subsidiary or such Permitted
Acquisition;
(j) Indebtedness of the OSIFC Family incurred in connection with the
Permitted Receivables Transaction in an aggregate amount at any time not
to exceed the Permitted Receivables Amount;
(k) Hedging Obligations of the Borrower or any of its Subsidiaries
which is not an OSIFC Family Member in respect of the Credit Extensions or
otherwise entered into by the Borrower or such Subsidiary to hedge against
interest rate or currency exchange rate fluctuations, in each case arising
in the ordinary course of business of the Borrower and its Subsidiaries
which are not OSIFC Family Members and not for speculative purposes;
(l) Indebtedness in respect of netting services, overdraft
protections and otherwise in connection with deposit accounts;
(m) Indebtedness incurred by Foreign Subsidiaries for working
capital purposes in an amount not to exceed $1,000,000;
(n) Permitted Refinancings of the Indebtedness listed above (other
than Indebtedness of the type permitted under clause (a) hereof);
(o) other unsecured Indebtedness issued in respect of the Restricted
Payment described in clause (b) of Section 7.2.6 which, when aggregated
with the amount of Restricted Payments made pursuant to such clause, does
not exceed $5,000,000 (which amount shall be increased Dollar-for-Dollar
by the amount of any cash payments made by any new shareholders of OSI
Common Stock in connection with their purchase of such OSI Common Stock)
over the term of this Agreement, and then only if such Indebtedness is,
except as otherwise consented to by the Administrative Agent, subordinated
on terms and conditions no less favorable to any Secured Party than those
contained in the Interco Subordination Agreement;
(p) Indebtedness incurred in connection with any transaction
otherwise permitted pursuant to Section 7.2.15; and
(q) other unsecured Indebtedness of the Borrower and its
Subsidiaries (other than Indebtedness of Non-Guarantors owing to the
Borrower or Subsidiary Guarantors) which are not OSIFC Family Members in
an aggregate amount at any time outstanding not to exceed $15,000,000;
provided, however, that no Indebtedness otherwise permitted by (A) clause (e),
(f)(ii), (i), (k), (o) or (q) shall be assumed or otherwise incurred if a
Default has occurred and is then continuing or would result therefrom, and (B)
clause (m) shall be assumed or otherwise incurred if a Default would result
therefrom.
SECTION 7.2.3. Liens. The Borrower will not, and will not permit any of
its Subsidiaries to, create, incur, assume or permit to exist any Lien upon any
of its property (including Capital Securities of any Person), revenues or
assets, whether now owned or hereafter acquired, except the following (each, a
"Permitted Lien"):
(a) Liens securing payment of the Obligations;
(b) until the Closing Date, Liens securing payment of Indebtedness
of the type described in clause (b) of Section 7.2.2;
(c) Liens existing as of the Closing Date and disclosed in Item
7.2.3(c) of the Disclosure Schedule securing Indebtedness described in
clause (c) of Section 7.2.2, including any Permitted Refinancings of such
Indebtedness; provided, that no such Lien shall encumber any additional
property and the amount of Indebtedness if any, secured by such Lien is
not increased from that existing on the Closing Date;
(d) Liens securing Indebtedness of the type permitted under clause
(e) of Section 7.2.2; provided, that such Lien (i) is granted within 60
days after such Indebtedness is incurred and (ii) secures only the assets
that are the subject of the Indebtedness referred to in such clause;
(e) Liens securing Indebtedness permitted by clause (i) of Section
7.2.2; provided, that such Liens existed prior to such Person becoming a
Subsidiary, were not created in anticipation thereof and attach only to
specific tangible assets of such Person (and not assets of such Person
generally);
(f) statutory and common law Liens in favor of carriers,
warehousemen, mechanics, materialmen and landlords granted in the ordinary
course of business for amounts not overdue or being diligently contested
in good faith by appropriate proceedings and for which adequate reserves
in accordance with GAAP shall have been set aside on its books;
(g) Liens incurred or deposits made in the ordinary course of
business in connection with worker's compensation, unemployment insurance
or other forms of governmental insurance or benefits, or to secure
performance of tenders, statutory obligations, bids, leases or other
similar obligations (other than for borrowed money) entered into in the
ordinary course of business or to secure obligations on surety and appeal
bonds or performance bonds;
(h) judgment Liens which do not result in an Event of Default under
Section 8.1.6;
(i) easements, rights-of-way, zoning restrictions, minor defects or
irregularities in title and other similar encumbrances not interfering in
any material respect with the value or use of the property to which such
Lien is attached;
(j) Liens for Taxes, assessments or other governmental charges or
levies not at the time delinquent or thereafter payable without penalty or
being diligently contested in good faith by appropriate proceedings and
for which adequate reserves in accordance with GAAP shall have been set
aside on its books;
(k) Liens on Accounts or other related assets of the OSIFC Family
created in connection with the Permitted Receivables Transaction;
(l) Liens solely on cash earnest money deposits in connection with
any letter of intent or purchase agreement entered into by the Borrower or
any of its Subsidiaries;
(m) Liens encumbering customary initial deposits and margin
deposits, and similar Liens attaching to commodity trading accounts or
other brokerage accounts incurred in the ordinary course of business;
(n) Liens in connection with the sale of accounts receivables by
a Foreign Subsidiary;
(o) Liens securing Indebtedness of Foreign Subsidiaries permitted
under Section 7.2.2 so long as any such Lien attaches only to the assets
of the respective Foreign Subsidiary that has incurred such Indebtedness;
(p) non-consensual Liens which may arise or be created under
Environmental Laws that are being contested in good faith and as to which
adequate reserves have been established to the extent required by GAAP and
secure obligations that would not reasonably be expected to have a
Material Adverse Effect;
(q) Liens arising from precautionary UCC financing statement filings
regarding operating leases;
(r) leases, subleases, licenses and sublicenses granted to third
parties in the ordinary course of business, in each case not interfering
in any material respect with the operations or business of the Borrower
and its Subsidiaries or the Liens of the Secured Parties granted by the
Loan Documents;
(s) extensions, renewals and replacements of any of the foregoing
Liens to the extent and for so long as the Indebtedness secured hereby is
expressly permitted hereunder and remains outstanding;
(t) landlord Liens arising under any lease contracts entered into by
the Borrower or any of its Subsidiaries in the ordinary course of business
(so long as no financing statements have been filed by such landlord);
(u) statutory Liens of depository or collecting banks on items in
collection and any accompanying documents or the proceeds thereof;
(v) Liens securing Indebtedness of the type permitted under clause
(p) of Section 7.2.2; and
(w) Liens to secure Indebtedness incurred in the ordinary course of
business and Indebtedness permitted under clause (d)(ii) of Section 7.2.2,
in an aggregate amount not to exceed $5,000,000 at any time outstanding.
SECTION 7.2.4. Financial Condition and Operations. The Borrower will
not permit any of the events set forth below to occur.
(a) The Borrower will not permit the Leverage Ratio as of the last
day of any Fiscal Quarter occurring during any period set forth below to
be greater than the ratio set forth opposite such period:
Period Leverage Ratio
------ --------------
01/01/00 through (and
including) 03/31/01 5.00:1.00
04/01/01 through (and
including) 06/30/01 4.75:1.00
07/01/01 through (and
including) 12/31/01 4.50:1.00
01/01/02 through (and
including) 06/30/02 4.25:1.00
07/01/02 through (and
including) 12/31/02 3.75:1.00
01/01/03 through (and
including) 06/30/03 3.50:1.00
07/01/03 through (and
including) 06/30/04 3.00:1.00
07/01/04 through (and
including) 12/31/04 2.50:1.00
01/01/05 and thereafter 2.00:1.00
(b) The Borrower will not permit the Interest Coverage Ratio as of
the last day of any Fiscal Quarter occurring during any period set forth
below to be less than the ratio set forth opposite such period:
Period Interest Coverage Ratio
------ -----------------------
01/01/00 through (and
including) 03/31/01 1.80:1.00
04/01/01 through (and
including) 03/31/02 2.00:1.00
04/01/02 through (and
including) 09/30/02 2.25:1.00
10/01/02 through (and
including) 06/30/03 2.50:1.00
07/01/03 through (and
including) 06/30/04 3.00:1.00
07/01/04 through (and
including) 12/31/04 4.00:1.00
01/01/05 and thereafter 5.00:1.00
(c) The Borrower will not permit the Fixed Charge Coverage Ratio as
of the last day of any Fiscal Quarter (beginning with the first Fiscal
Quarter of the 2000 Fiscal Year) to be less than (i) 1.25:1.00 through
(and including) December 31, 2002 and (ii) 1.15:1.00 for each Fiscal
Quarter thereafter.
(d) The Borrower will not permit EBITDA for the period of four
consecutive Fiscal Quarters ending on the last day of any Fiscal Quarter
occurring during any period set forth below to be less than the amount set
forth opposite such period:
Period EBITDA
------ ------
01/01/00 through (and
including) 03/31/01 $95,000,000
04/01/01 through (and
including) 09/30/01 $100,000,000
10/01/01 through (and
including) 09/30/02 $105,000,000
10/01/02 through (and
including) 06/30/03 $110,000,000
07/01/03 through (and
including) 12/31/03 $115,000,000
01/01/04 through (and
including) 06/30/04 $120,000,000
07/01/04 through (and
including) 12/31/04 $130,000,000
01/01/05 through (and
including) 12/31/05 $140,000,000
01/01/06 and thereafter $150,000,000
SECTION 7.2.5. Investments. The Borrower will not, and will not permit
any of its Subsidiaries to, purchase, make, incur, assume or permit to exist any
Investment in any other Person, except:
(a) Investments existing on the Closing Date and identified in
Item 7.2.5(a) of the Disclosure Schedule;
(b) Cash Equivalent Investments;
(c) Investments received in connection with the bankruptcy or
reorganization of, or settlement of delinquent accounts and disputes with,
customers and suppliers, in each case in the ordinary course of business;
(d) without duplication, Investments permitted as (i) Capital
Expenditures pursuant to Section 7.2.7 (including any such Investments
which would otherwise constitute Capital Expenditures but for the
operation of clause (i) of the proviso to the definition of "Capital
Expenditures"), (ii) Indebtedness pursuant to Section 7.2.2 and (iii)
Restricted Payments pursuant to clause (b) of Section 7.2.6;
(e) Investments by way of (i) contributions to capital or purchases
of Capital Securities by the Borrower in any Subsidiaries (other than any
OSIFC Family Member) or by any Subsidiary in other Subsidiaries (in either
case, other than any OSIFC Family Member); provided, that the aggregate
amount of intercompany loans made pursuant to clause (f)(ii) of Section
7.2.2 and Investments under this clause made by the Borrower and
Subsidiary Guarantors in Non-Guarantors shall not exceed $3,000,000 at any
time, or (ii) contributions to capital by any Subsidiary in the Borrower;
(f) Investments made by the Borrower and its Subsidiaries that
constitute (i) accounts receivable arising, (ii) trade debt granted, or
(iii) deposits made in connection with the purchase price of goods or
services, in each case in the ordinary course of business;
(g) Investments made by the Borrower and its Subsidiaries
constituting Permitted Acquisitions in an aggregate amount not to exceed
$35,000,000 (which amount shall include the assumption of all Indebtedness
in connection with such Permitted Acquisition and the aggregate amount of
Specified Liabilities (but only to the extent the obligations associated
with such Specified Liabilities are recorded as liabilities on the
consolidated balance sheet of the Borrower and its Subsidiaries in
accordance with GAAP), regardless of the date on which such Specified
Liabilities are actually recorded) in any single transaction or series of
related transactions;
(h) Investments consisting of any deferred portion of the sales
price received by the Borrower or any Subsidiary in connection with any
Disposition permitted under Section 7.2.11 to the extent such deferred
portion does not exceed the portion of such sales price which may be
non-cash under Section 7.2.11;
(i) Investments in the ordinary course of business in the form of
loans and advances to officers, directors and employees of the Borrower or
any of its Subsidiaries to finance the purchase of Capital Securities of
Borrower, so long as the aggregate amount of (x) any such loan or advance
does not exceed the purchase price of the Capital Securities so financed
and (y) all such loans and advances does not exceed $5,000,000 at any time
outstanding;
(j) Investments made by the Borrower or any of its Subsidiaries,
solely with proceeds which have been contributed, directly or indirectly
after the Closing Date, to the Borrower or such Subsidiary as cash equity
from holders of Borrower's Capital Securities for the purpose of making an
Investment identified in a notice to the Administrative Agent on or prior
to the date that such capital contribution is made, which Investments
shall result in the Borrower or such Subsidiary acquiring a majority
controlling interest in or substantially all of the assets of the Person
in which such Investment was made or from which such assets were purchased
or increasing any such controlling interest already maintained by it;
(k) Investments in OSIFC in an aggregate amount not to exceed
$5,000,000, which amount shall be in addition to the amount of Investments
made by the Borrower and its Subsidiaries and existing on the Closing
Date;
(l) Investments made with Casualty Proceeds in accordance with the
provisions of clause (h) of Section 3.1.1;
(m) Investments consisting of acquisitions of receivables portfolios
("Permitted Portfolio Acquisitions"); provided, that the aggregate amount
expended by the Borrower and its Subsidiaries for Permitted Portfolio
Acquisitions shall not exceed $15,000,000 in any Fiscal Year; and
(n) other Investments made by the Borrower and its Subsidiaries
(other than any Investments of the type permitted in clauses (a) through
(m) above) in an amount not to exceed $10,000,000 over the term of this
Agreement;
provided, however, that
(o) any Investment which when made complies with the requirements of
clause (a), (b), (c) or (d) of the definition of the term "Cash Equivalent
Investment" may continue to be held notwithstanding that such Investment
if made thereafter would not comply with such requirements; and
(p) no Investment otherwise permitted by clause (d)(i), (d)(ii)
(except to the extent permitted under Section 7.2.2), (g) or (i) shall be
permitted to be made if any Default has occurred and is continuing or
would result therefrom.
SECTION 7.2.6. Restricted Payments, etc. The Borrower will not, and will
not permit any of its Subsidiaries to, declare or make a Restricted Payment, or
make any deposit for any Restricted Payment (other than Restricted Payments made
by Subsidiaries to the Borrower or wholly owned Subsidiaries) in excess of
$2,000,000 in the aggregate over the term of this Agreement (which amount may
not be added to the additional Restricted Payments permitted in clauses (a)
through (c) below); provided, however, that, notwithstanding any of the
foregoing, the Borrower may make additional Restricted Payments, without
duplication,
(a) beginning December 1, 2004, to the extent necessary to make
scheduled dividend payments on the PIK Preferred Equity in accordance with
the PIK Preferred Equity Documents;
(b) in respect of Repurchase Payments; provided, that the aggregate
consideration paid for such Repurchase Payments, when aggregated with the
amount of Indebtedness incurred pursuant to clause (o) of Section 7.2.2
(without duplication), shall not exceed $5,000,000 over the term of this
Agreement; and
(c) in respect of advisory fees in an amount not to exceed $500,000
in the aggregate in any Fiscal Year.
Notwithstanding any of the foregoing, the Borrower may make any such Restricted
Payment only so long as (a) both before and after giving effect to such
Restricted Payment, no Default shall have occurred and be continuing, and (b)
the Borrower shall have delivered to the Administrative Agent (A) financial
statements prepared on a pro forma basis to give effect to such Restricted
Payment for the period of four consecutive Fiscal Quarters ending with the
Fiscal Quarter then last ended for which financial statements and the Compliance
Certificate relating thereto have been delivered to the Administrative Agent
pursuant to Section 7.1.1 and (B) a certificate of the Borrower executed by an
Authorized Officer of the Borrower demonstrating that the financial results
reflected in such financial statements would comply with the requirements of
Section 7.2.4 for the Fiscal Quarter in which such Restricted Payment is to be
made.
SECTION 7.2.7. Capital Expenditures, etc. Subject (in the case of
Capitalized Lease Liabilities) to clause (e) of Section 7.2.2, (a) the Borrower
will not, and will not permit any of its Subsidiaries to, make or commit to make
Capital Expenditures other than Capital Expenditures made or committed to be
made by the Borrower and its Subsidiaries in any Fiscal Year which in the
aggregate do not exceed, (i) for the 2000 Fiscal Year, $25,000,000, and (ii) for
each Fiscal Year thereafter, $20,000,000; provided, however, that
notwithstanding anything to the contrary in this clause, in the event that the
amount of Capital Expenditures permitted to be made by the Borrower and its
Subsidiaries during any Fiscal Year (or portion thereof) pursuant to this clause
(prior to giving effect to any increase in such permitted amounts pursuant to
this proviso) is greater than the aggregate amount of such Capital Expenditures
made by the Borrower and its Subsidiaries during such Fiscal Year (or portion
thereof), such excess (up to an aggregate of 50% of the amount set forth
opposite such Fiscal Year, each such amount of excess, a "Carry-Forward Amount")
may be carried forward to the immediately succeeding Fiscal Year and utilized to
make Capital Expenditures in such succeeding Fiscal Year (it being understood
and agreed that a Carry-Forward Amount may not be carried beyond the Fiscal Year
immediately succeeding the Fiscal Year in which it arose ). With respect to any
Carry-Forward Amount, (i) it shall be certified by the Borrower to the
Administrative Agent in the Compliance Certificate delivered for the last Fiscal
Quarter of such Fiscal Year, and (ii) it shall be deemed to be used prior to the
Borrower and its Subsidiaries using any amount of Capital Expenditures permitted
for such immediately succeeding Fiscal Year.
(b) The parties acknowledge and agree that the permitted Capital
Expenditure amounts set forth in clause (a) above shall be exclusive of (i) the
amount of Capital Expenditures actually made with cash capital contributions
made to the Borrower or any of its Subsidiaries, directly or indirectly, by any
Person other than the Borrower and its Subsidiaries, after the Closing Date and
specifically identified in a certificate delivered by an Authorized Officer of
the Borrower to the Administrative Agent on or about the time such capital
contribution or equity issuance is made (but in any event prior to the time of
the Capital Expenditure made with such capital contribution or equity issuance);
provided, that, to the extent such cash capital contributions or any proceeds
from such equity issuance constitute Net Equity Proceeds arising from the
issuance by the Borrower of its Capital Securities, only that portion of such
Net Equity Proceeds which are not required to be applied as a prepayment
pursuant to clause (g) of Section 3.1.1 may be used for Capital Expenditures
pursuant to this clause and (ii) any portion of any acquisition that is
permitted under Section 7.2.5 (other than pursuant to clause (d) thereof) that
is accounted for as a Capital Expenditure.
SECTION 7.2.8. No Prepayment of Subordinated Debt. The Borrower will
not, and will not permit any of its Subsidiaries to,
(a) make any payment or prepayment of principal of, or premium or
interest on, any Subordinated Debt (i) other than the stated, scheduled
date for payment of interest set forth in the applicable Subordinated Debt
Documents, (ii) other than with Net Equity Proceeds (after application
pursuant to clause (g) of Section 3.1.1) in accordance with the applicable
Subordinated Debt Documents or (iii) which would violate the terms of this
Agreement or the applicable Subordinated Debt Documents;
(b) redeem, retire, purchase, defease or otherwise acquire any
Subordinated Debt; or
(c) make any deposit (including the payment of amounts into a
sinking fund or other similar fund) for any of the foregoing purposes.
Furthermore, neither the Borrower nor any Subsidiary will designate any
Indebtedness other than the Obligations as "Designated Senior Debt" (or any
analogous term) in any Subordinated Debt Document.
SECTION 7.2.9. Issuance of Capital Securities. The Borrower will not,
and will not permit any of its Subsidiaries (other than Pay Tech) to, (a) issue
any Capital Securities (whether for value or otherwise) to any Person other than
(i) (in the case of Subsidiaries) the Borrower or another wholly owned
Subsidiary, (ii) for transfers, replacements and exchanges of then outstanding
shares of Capital Securities, (iii) for stock splits, stock dividends and
issuances which do not decrease the percentage ownership of the Borrower or any
of its Subsidiaries in any class of the Capital Securities of such Subsidiary
(and for which the Secured Parties continue to have a first priority pledge of
such Capital Securities), (iv) to qualify directors to the extent required by
applicable law and (v) for issuances by newly created or acquired Subsidiaries
in accordance with the terms of this Agreement, or (b) become liable in respect
of any obligation (contingent or otherwise) to purchase, redeem, retire, acquire
or make any other payment in respect of any Capital Securities of the Borrower
(other than obligations for Repurchase Payments) or any Subsidiary or any
option, warrant or other right to acquire any such Capital Securities; provided,
however, that, notwithstanding any of the foregoing, the Borrower may issue its
Capital Securities to the extent that, after giving effect to any such issuance,
no Default shall result therefrom.
SECTION 7.2.10. Consolidation, Merger, etc. The Borrower will not, and
will not permit any of its Subsidiaries to, liquidate or dissolve, consolidate
with, or merge into or with, any other Person, or purchase or otherwise acquire
all or substantially all of the assets of any Person (or any division thereof),
except
(a) Pay Tech may liquidate or dissolve, and any other Subsidiary may
liquidate or dissolve voluntarily into, and may merge with and into, the
Borrower (so long as the Borrower is the surviving corporation) or any
other Subsidiary (provided, however, that a Subsidiary Guarantor may only
liquidate or dissolve into, or merge with and into, the Borrower or
another Subsidiary Guarantor), and the assets or Capital Securities of any
Subsidiary may be purchased or otherwise acquired by the Borrower or any
other Subsidiary (provided, however, that the assets or Capital Securities
of any Subsidiary Guarantor may only be purchased or otherwise acquired by
the Borrower or another Subsidiary Guarantor unless such assets are of the
type described in clause (a) or (c) of Section 7.2.11); provided, further,
that in no event shall any Pledged Subsidiary consolidate with or merge
with and into any Subsidiary other than another Pledged Subsidiary unless
after giving effect thereto, the Administrative Agent shall have a
perfected pledge of, and security interest in and to, at least the same
percentage of the issued and outstanding interests of Capital Securities
(on a fully diluted basis) of the surviving Person as the Administrative
Agent had immediately prior to such merger or consolidation in form and
substance satisfactory to the Administrative Agent and its counsel,
pursuant to such documentation and opinions as shall be necessary in the
reasonable opinion of the Administrative Agent to create, perfect or
maintain the collateral position of the Secured Parties therein; and
(b) so long as no Default has occurred and is continuing or would
occur after giving effect thereto, the Borrower or any of its Subsidiaries
may (to the extent permitted by clause (g) of Section 7.2.5) purchase all
or substantially all of the assets or Capital Securities of any Person (or
any division thereof), or acquire such Person by merger.
SECTION 7.2.11. Permitted Dispositions. The Borrower will not, and will
not permit any of its Subsidiaries to, Dispose of any of the Borrower's or such
Subsidiaries' assets (including accounts receivable and Capital Securities of
Subsidiaries) to any Person in one transaction or a series of transactions
unless:
(a) such Disposition is of inventory, obsolete equipment or
receivables portfolios, in each case Disposed of in the ordinary course
of business;
(b) such Disposition is permitted by Section 7.2.10;
(c) such Disposition is of Accounts or other related assets and
ancillary rights in property pursuant to the Permitted Receivables
Transaction; or
(d) such Disposition is not described in clauses (a) through (c)
above and (i) such Disposition is for not less than the fair market value
of the assets to be Disposed, (ii) the consideration received by the
Borrower or such Subsidiary consists of at least 80% cash, (iii) the Net
Disposition Proceeds received from such Disposition, together with the Net
Disposition Proceeds of all other assets Disposed pursuant to this clause
since the Closing Date, does not exceed (individually or in the aggregate)
$10,000,000 over the term of this Agreement, and (iv) an amount equal to
the Net Disposition Proceeds received from such Disposition are applied in
accordance with Sections 3.1.1 and 3.1.2.
SECTION 7.2.12. Modification of Certain Documents. After the Closing
Date, the Borrower will not, and will not permit any of its Subsidiaries to,
consent to any amendment, supplement, waiver or other modification of, or enter
into any forbearance from exercising any rights with respect to the terms or
provisions contained in,
(a) the Subordinated Debt Documents, other than any amendment,
supplement, waiver or modification for which no fee is payable to the
holders of the Subordinated Debt in excess of $1,000,000 in the aggregate
over the term of this Agreement and which (i) extends the date or reduces
the amount of any required repayment, prepayment or redemption of the
principal of such Subordinated Debt, (ii) reduces the rate or extends the
date for payment of the interest, premium (if any) or fees payable on such
Subordinated Debt, (iii) makes the covenants, events of default or
remedies in such Subordinated Debt Documents less restrictive on the
Borrower or its Subsidiaries, (iv) does not in any way adversely affect
the interests of the Secured Parties hereunder or under the Loan Documents
or (v) is of a technical or clarifying nature; or
(b) any of the Material Documents, other than any amendment,
supplement, waiver or modification which (i) does not in any way adversely
affect the interests of the Secured Parties hereunder or under the Loan
Documents or (ii) is of a technical or clarifying nature; or
(c) any of the Receivables Documents, other than any such amendment,
supplement, waiver or modification which (i) would extend the maturity
thereof, (ii) does not in any way adversely affect the interests of the
Secured Parties hereunder or under the Loan Documents or (iii) is of a
technical or clarifying nature.
SECTION 7.2.13. Transactions with Affiliates. The Borrower will not, and
will not permit any of its Subsidiaries to, enter into or cause or permit to
exist any arrangement, transaction or contract (including for the purchase,
lease or exchange of property or the rendering of services) with any of its
other Affiliates, unless such arrangement, transaction or contract is (i) on
fair and reasonable terms no less favorable to the Borrower or such Subsidiary
than it could obtain in an arm's-length transaction with a Person that is not an
Affiliate, (ii) of the kind which would be entered into by a prudent Person in
the position of the Borrower or such Subsidiary with a Person that is not one of
its Affiliates, (iii) fees paid to MDCP on the Closing Date and thereafter in an
amount not to exceed $500,000 per annum, (iv) the Permitted Receivables
Transaction, and (v) the Investment described in clause (i) of Section 7.2.5 in
an amount not to exceed $5,000,000 at any time outstanding.
SECTION 7.2.14. Restrictive Agreements, etc. The Borrower will not,
and will not permit any of its Subsidiaries to, enter into any agreement
prohibiting
(a) the creation or assumption of any Lien for the benefit of any
Secured Party;
(b) the ability of any Obligor to amend or otherwise modify any Loan
Document; or
(c) the ability of any Subsidiary to make any payments, directly or
indirectly, to the Borrower, including by way of dividends, advances,
repayments of loans, reimbursements of management and other intercompany
charges, expenses and accruals or other returns on investments.
The foregoing prohibitions shall not apply to restrictions contained (i) in any
Loan Document, (ii) in the case of clause (a), in any agreement governing any
Indebtedness permitted by clause (e) of Section 7.2.2 as to the assets financed
with the proceeds of such Indebtedness or (iii) in the case of clauses (a) and
(c), in (A) any agreement of a Non-Guarantor governing the Indebtedness
permitted by clause (f)(ii) of Section 7.2.2 or (B) any Receivables Documents.
SECTION 7.2.15. Sale and Leaseback. Other than with respect to the
properties listed in Item 7.2.15 of the Disclosure Schedule, the Borrower will
not, and will not permit any of its Subsidiaries to, directly or indirectly
enter into any agreement or arrangement providing for the sale or transfer by it
of any property (now owned or hereafter acquired) to a Person and the subsequent
lease or rental of such property or other similar property from such Person.
SECTION 7.2.16. Accounting Changes. The Borrower will not, and will not
permit any of its Subsidiaries to, change its Fiscal Year from twelve
consecutive calendar months ending on December 31.
SECTION 7.3. UAS and the Student Loan Collection Business.
Notwithstanding anything to the contrary in this Agreement, with respect to UAS
and the Student Loan Collection Business, the Borrower covenants and agrees with
each Managing Agent, each Lender and each Issuer that until the Termination Date
has occurred, the Borrower will, and will cause UAS and, to the extent
applicable, each other Subsidiary to, perform or cause to be performed the
obligations set forth below.
SECTION 7.3.1. Business Activities. UAS will not engage in any
business activity
(a) other than in connection with the Student Loan Collection
Business; and
(b) so long as UAS is a Subsidiary Guarantor, in any State of the
United States (or any political subdivision thereof) where, under
applicable law, UAS's guarantee of the Obligations pursuant to the
Subsidiary Guaranty would prohibit UAS from engaging in the Student Loan
Collection Business in such State (or political subdivision).
SECTION 7.3.2. Indebtedness. UAS will not create, incur, assume or
permit to exist any Indebtedness, except Indebtedness (a) existing as of the
Closing Date which is identified in Item 7.2.2(c) of the Disclosure Schedule,
and Permitted Refinancings of such Indebtedness, (b) in respect of UAS's
guarantee of (i) the Obligations pursuant to the Subsidiary Guaranty and (ii)
the obligations of the Borrower under and pursuant to the Subordinated Debt
Documents, and (c) which is intercompany Indebtedness otherwise permitted
pursuant to this Agreement.
SECTION 7.3.3. Liens. UAS will not create, incur, assume or permit to
exist any Lien upon any of its property, revenues or assets, whether now owned
or hereafter acquired, except Permitted Liens created, incurred, assumed or
otherwise existing (a) in the ordinary course of the Student Loan Collection
Business and (b) pursuant to any Loan Document.
SECTION 7.3.4. Investments. UAS will not purchase, make, incur, assume
or permit to exist any Investment in any other Person (including Investments in
the Borrower or any other Subsidiary) nor will the Borrower or any other
Subsidiary purchase, make, incur, assume or permit to exist any Investment in
UAS, except, in any case, as otherwise permitted under clauses (a), (b) and
(e)(i) of Section 7.2.5.
SECTION 7.3.5. Restricted Payments, etc. UAS will, within 45 days
following the end of each Fiscal Quarter, declare and make a Restricted Payment
to the Borrower in an aggregate amount such that, immediately after giving
effect to any such Restricted Payment, UAS would not have a "positive net worth"
(as defined in any regulations or laws binding on or applicable to UAS) in
excess of "positive net worth" plus $500,000.
SECTION 7.3.6. Consolidation, Merger. UAS will not liquidate or
dissolve, consolidate with, or merge into or with, any other Person, or purchase
or otherwise acquire all or substantially all of the assets of any Person (or
any division thereof).
SECTION 7.4. OSIFC Transaction. Each of the Secured Parties agree that,
notwithstanding anything to the contrary set forth in this Agreement, within
thirty days following the Closing Date, the Borrower may (a) cause OSIFC to
convert its corporate status to that of a limited liability company and Dispose
of (or permit OSIFC to issue additional) Capital Securities of OSIFC such that,
after giving effect to such Disposition (and/or issuance), OSIFC will no longer
be a Subsidiary of the Borrower, and (b) make a Restricted Payment in an
aggregate amount not to exceed $3,500,000 in connection with such conversion and
Disposition (and/or issuance).
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1. Listing of Events of Default. Each of the following
events or occurrences described in this Article shall constitute an "Event of
Default".
SECTION 8.1.1. Non-Payment of Obligations. The Borrower shall default
in the payment or prepayment when due of
(a) any principal of any Loan, or any Reimbursement Obligation or
any deposit of cash for collateral purposes pursuant to Section 2.6.4; or
(b) interest on any Loan, any Reimbursement Obligation, any fee
described in Article III, or any other monetary Obligations and such
default shall continue unremedied for a period of three Business Days
after such amount was due.
SECTION 8.1.2. Breach of Warranty. Any representation or warranty of
any Obligor made or deemed to be made in any Loan Document to which such Obligor
is party or any other writing or certificate (including any certificates
delivered pursuant to Article V) furnished by or on behalf of any Obligor to any
Secured Party for the purposes of or in connection with any Loan Document is or
shall be incorrect when made or deemed to have been made in any material
respect.
SECTION 8.1.3. Non-Performance of Certain Covenants and Obligations.
The Borrower shall default in the due performance or observance of any of its
obligations under Section 7.1.1, 7.1.7, 7.1.13 or 7.2.
SECTION 8.1.4. Non-Performance of Other Covenants and Obligations. Any
Obligor shall default in the due performance or observance of any other
agreement contained in any Loan Document to which such Obligor is party, and
such default shall continue unremedied for a period of 30 days after notice
thereof shall have been given to the Borrower by either Managing Agent or any
Lender.
SECTION 8.1.5. Default on Other Indebtedness. A default shall occur in
the payment of any amount when due (subject to any applicable grace period),
whether by acceleration or otherwise, of any principal or stated amount of, or
interest or fees on, of any Indebtedness (other than Indebtedness described in
Section 8.1.1) of any Obligor having a principal or stated amount, individually
or in the aggregate, in excess of $5,000,000, or a default shall occur in the
performance or observance of any obligation or condition with respect to such
Indebtedness if the effect of such default is to accelerate the maturity of any
such Indebtedness or such default shall continue unremedied for any applicable
period of time sufficient to permit the holder or holders of such Indebtedness,
or any trustee or agent for such holders, to cause or declare such Indebtedness
to become due and payable or to require such Indebtedness to be prepaid,
redeemed, purchased or defeased, or require an offer to purchase or defease such
Indebtedness to be made, prior to its expressed maturity.
SECTION 8.1.6. Judgments. Any judgment or order for the payment of
money, individually or in the aggregate, in excess of $5,000,000 (exclusive of
any amounts fully covered by insurance or indemnification (less any applicable
deductible) and as to which the insurer has acknowledged in writing its
responsibility to cover such judgment or order) shall be rendered against any
Obligor and either (i) such judgment shall not have been vacated or discharged
or stayed or bonded pending appeal within 30 days after the entry thereof
(unless the judgment allows for a longer period of time for payment) or (ii)
enforcement proceedings shall have been commenced by any creditor upon such
judgment or order.
SECTION 8.1.7. Pension Plans. Any of the following events shall occur
with respect to any Pension Plan
(a) the institution of any steps by the Borrower, any member of its
Controlled Group or any other Person to terminate a Pension Plan if, as a
result of such termination, the Borrower or any such member could be
required to make a contribution to such Pension Plan, or could reasonably
expect to incur a liability or obligation to such Pension Plan, in excess
of $1,000,000; or
(b) a contribution failure occurs with respect to any Pension Plan
sufficient to give rise to a Lien under section 302(f) of ERISA.
SECTION 8.1.8. Change in Control. Any Change in Control shall occur.
SECTION 8.1.9. Bankruptcy, Insolvency, etc. Any Obligor shall
(a) become insolvent or generally fail to pay, or admit in writing
its inability or unwillingness generally to pay, debts as they become due;
(b) apply for, consent to, or acquiesce in the appointment of a
trustee, receiver, sequestrator or other custodian for any substantial
part of the property of any thereof, or make a general assignment for the
benefit of creditors;
(c) in the absence of such application, consent or acquiescence in
or permit or suffer to exist the appointment of a trustee, receiver,
sequestrator or other custodian for a substantial part of the property of
any thereof, and such trustee, receiver, sequestrator or other custodian
shall not be discharged within 60 days; provided, that each Obligor hereby
expressly authorizes each Secured Party to appear in any court conducting
any relevant proceeding during such 60-day period to preserve, protect and
defend their rights under the Loan Documents;
(d) permit or suffer to exist the commencement of any bankruptcy,
reorganization, debt arrangement or other case or proceeding under any
bankruptcy or insolvency law or any dissolution, winding up or liquidation
proceeding, in respect thereof, and, if any such case or proceeding is not
commenced by any Obligor, such case or proceeding shall be consented to or
acquiesced in by such Person or shall result in the entry of an order for
relief or shall remain for 60 days undismissed; provided, that the each
Obligor hereby expressly authorizes each Secured Party to appear in any
court conducting any such case or proceeding during such 60-day period to
preserve, protect and defend their rights under the Loan Documents; or
(e) take any action authorizing, or in furtherance of, any of the
foregoing.
SECTION 8.1.10. Impairment of Security, etc. Any Loan Document or any
Lien granted thereunder shall (except in accordance with its terms), in whole or
in part, terminate, cease to be effective or cease to be the legally valid,
binding and enforceable obligation of any Obligor party thereto; any Obligor or
any other party shall, directly or indirectly, contest in any manner such
effectiveness, validity, binding nature or enforceability; except as permitted
under any Loan Document or as a result of a Secured Party's wilful misconduct or
gross negligence, any Lien securing any Obligation shall, in whole or in part,
cease to be (subject to Permitted Liens) a perfected first priority Lien; or,
except as permitted under any Loan Document or as a result of a Secured Party's
wilful misconduct or gross negligence, the Administrative Agent, for the benefit
of the Secured Parties,shall fail to have a valid, first priority pledge of at
least 80.5% of the issued and outstanding OSI Common Stock on a fully diluted
basis.
SECTION 8.1.11. Failure of Subordination. Unless otherwise waived or
consented to by the Secured Parties in writing, the subordination provisions
relating to any Subordinated Debt (the "Subordination Provisions") shall fail to
be enforceable by the Secured Parties in accordance with the terms thereof or
the monetary Obligations shall fail to constitute "Senior Indebtedness" (or a
similar term) referring to the Obligations; or any Obligor shall, directly or
indirectly, disavow or contest in any manner (i) the effectiveness, validity or
enforceability of any of the Subordination Provisions, (ii) that the
Subordination Provisions exist for the benefit of the Secured Parties or (iii)
that all payments of principal of or premium and interest on the Subordinated
Debt, or realized from the liquidation of any property of any Obligor, shall be
subject to any of such Subordination Provisions.
SECTION 8.1.12. Redemption. Any event shall occur which, under the
terms of any Subordinated Debt Document, shall require the Borrower or any of
its Subsidiaries to purchase, redeem or otherwise acquire or offer to purchase,
redeem or otherwise acquire all or any portion of the principal amount of any
such Subordinated Debt prior to its final stated maturity date.
SECTION 8.2. Action if Bankruptcy. If any Event of Default described in
clauses (a) through (d) of Section 8.1.9 with respect to the Borrower shall
occur, the Commitments (if not theretofore terminated) shall automatically
terminate and the outstanding principal amount of all outstanding Loans and all
other Obligations (including Reimbursement Obligations) shall automatically be
and become immediately due and payable, without notice or demand to any Person,
and each Obligor shall automatically and immediately be obligated to Cash
Collateralize all Letter of Credit Outstandings.
SECTION 8.3. Action if Other Event of Default. If any Event of Default
(other than any Event of Default described in clauses (a) through (d) of Section
8.1.9 with respect to the Borrower) shall occur for any reason, whether
voluntary or involuntary, and be continuing, the Administrative Agent, upon the
direction of the Required Lenders, shall by notice to the Borrower declare all
or any portion of the outstanding principal amount of the Loans and other
Obligations (including Reimbursement Obligations) to be due and payable and/or
the Commitments (if not theretofore terminated) to be terminated, whereupon the
full unpaid amount of such Loans and other Obligations which shall be so
declared due and payable shall be and become immediately due and payable,
without further notice, demand or presentment, and/or, as the case may be, the
Commitments shall terminate and the Borrower shall automatically and immediately
be obligated to Cash Collateralize all Letter of Credit Outstandings.
ARTICLE IX
THE AGENTS
SECTION 9.1. Actions. Each Lender hereby appoints DLJ as its Syndication
Agent and Fleet as its Administrative Agent under and for purposes of each Loan
Document. Each Lender authorizes each Managing Agent to act on behalf of such
Lender under each Loan Document and, in the absence of other written
instructions from the Required Lenders received from time to time by the
Managing Agents (with respect to which each Managing Agent agrees that it will
comply, except as otherwise provided in this Section or as otherwise advised by
counsel in order to avoid contravention of applicable law), to exercise such
powers hereunder and thereunder as are specifically delegated to or required of
such Managing Agent by the terms hereof and thereof, together with such powers
as may be reasonably incidental thereto. Each Lender hereby indemnifies (which
indemnity shall survive any termination of this Agreement) each Managing Agent,
pro rata according to such Lender's proportionate Total Exposure Amount, from
and against any and all liabilities, obligations, losses, damages, claims, costs
or expenses of any kind or nature whatsoever which may at any time be imposed
on, incurred by, or asserted against, such Managing Agent in any way relating to
or arising out of any Loan Document, including reasonable attorneys' fees, and
as to which such Managing Agent is not reimbursed by the Borrower; provided,
however, that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, claims, costs or expenses which are
determined by a court of competent jurisdiction in a final proceeding to have
resulted from such Managing Agent's gross negligence or wilful misconduct.
Neither Managing Agent shall be required to take any action under any Loan
Document, or to prosecute or defend any suit in respect of any Loan Document,
unless it is indemnified hereunder to its satisfaction. If any indemnity in
favor of either Managing Agent shall be or become, in such Managing Agent's
determination, inadequate, such Managing Agent may call for additional
indemnification from the Lenders and cease to do the acts indemnified against
hereunder until such additional indemnity is given.
SECTION 9.2. Funding Reliance, etc. Unless the Administrative Agent shall
have been notified in writing by any Lender by 3:00 p.m. on the Business Day
prior to a Borrowing that such Lender will not make available the amount which
would constitute its Percentage of such Borrowing on the date specified
therefor, the Administrative Agent may assume that such Lender has made such
amount available to the Administrative Agent and, in reliance upon such
assumption, make available to the Borrower a corresponding amount. If and to the
extent that such Lender shall not have made such amount available to the
Administrative Agent, such Lender and the Borrower severally agree to repay the
Administrative Agent forthwith on demand such corresponding amount together with
interest thereon, for each day from the date the Administrative Agent made such
amount available to the Borrower to the date such amount is repaid to the
Administrative Agent, at the interest rate applicable at the time to Loans
comprising such Borrowing (in the case of the Borrower) and (in the case of a
Lender), at the Federal Funds Effective Rate for the first two Business Days
after which such amount has not been repaid, and thereafter at the interest rate
applicable to Loans comprising such Borrowing.
SECTION 9.3. Exculpation; Notice of Default. (a) Neither Managing Agent
nor any Issuer nor any of their respective directors, officers, employees or
agents shall be liable to any Lender for any action taken or omitted to be taken
by it under any Loan Document, or in connection herewith or therewith, except
for its own wilful misconduct or gross negligence, nor responsible for any
recitals or warranties herein or therein, nor for the effectiveness,
enforceability, validity or due execution of any Loan Document, nor for the
creation, perfection or priority of any Liens purported to be created by any of
the Loan Documents, or the validity, genuineness, enforceability, existence,
value or sufficiency of any collateral security, nor to make any inquiry
respecting the performance by any Obligor of its Obligations. Any such inquiry
which may be made by either Managing Agent or any Issuer shall not obligate it
to make any further inquiry or to take any action. The Administrative Agent and
each Issuer shall be entitled to rely upon advice of counsel concerning legal
matters and upon any notice, consent, certificate, statement or writing which
the Administrative Agent believes to be genuine and to have been presented by a
proper Person.
(b) Neither Managing Agent, the Swing Line Lender nor any Issuer shall be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless any such Person has received written notice from (A) in
the case of the Administrative Agent, the Swing Line Lender or any Issuer, a
Lender or the Borrower referring to this Agreement describing such Default or
Event of Default and stating that such notice is a "notice of default" and (B)
in the case of the Syndication Agent, from the Administrative Agent as set forth
in the immediately following sentence. In the event that the Administrative
Agent receives such a notice, the Administrative Agent shall give prompt notice
thereof to the Syndication Agent and the Lenders.
SECTION 9.4. Successors. The Syndication Agent may resign as such upon
one Business Day's notice to the Borrower and the Administrative Agent. The
Administrative Agent may resign as such at any time upon at least 30 days' prior
notice to the Borrower and all Lenders. If the Administrative Agent at any time
shall resign, the Required Lenders may, with the consent of the Borrower (not to
be unreasonably withheld), appoint another Lender as a successor Administrative
Agent which shall thereupon become the Administrative Agent hereunder. If no
successor Administrative Agent shall have been so appointed by the Required
Lenders, and shall have accepted such appointment, within 30 days after the
retiring Administrative Agent's giving notice of resignation, then the retiring
Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which shall be one of the Lenders or a commercial banking
institution organized under the laws of the U.S. (or any State thereof) or a
U.S. branch or agency of a commercial banking institution, and having a combined
capital and surplus of at least $500,000,000. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall be entitled to receive from the
retiring Administrative Agent such documents of transfer and assignment as such
successor Administrative Agent may reasonably request, and shall thereupon
succeed to and become vested with all rights, powers, privileges and duties of
the retiring Administrative Agent, and the retiring Administrative Agent shall
be discharged from its duties and obligations under the Loan Documents. After
any retiring Administrative Agent's resignation hereunder as the Administrative
Agent, the provisions of this Article shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was the Administrative Agent
under the Loan Documents, and Sections 10.3 and 10.4 shall continue to inure to
its benefit.
SECTION 9.5. Credit Extensions by each Managing Agent and each Issuer.
Each Managing Agent and each Issuer, in its individual capacity as a Lender
shall have the same rights and powers with respect to (x)(i) in the case of a
Managing Agent, the Credit Extensions made by it or any of its Affiliates and
(ii) in the case of an Issuer, the Loans made by it or any of its Affiliates,
and (y) the Notes held by it or any of its Affiliates as any other Lender and
may exercise the same as if it were not a Managing Agent or Issuer. Each
Managing Agent, each Issuer and each of their respective Affiliates, in each
case, in its individual capacity, may accept deposits from, lend money to, and
generally engage in any kind of business with the Borrower or any Subsidiary or
Affiliate of the Borrower as if such Managing Agent or Issuer were not a
Managing Agent or Issuer hereunder.
SECTION 9.6. Credit Decisions. Each Lender acknowledges that it has,
independently of each Managing Agent and each other Lender, and based on such
Lender's review of the financial information of the Borrower and its
Subsidiaries, the Loan Documents (the terms and provisions of which being
satisfactory to such Lender) and such other documents, information and
investigations as such Lender has deemed appropriate, made its own credit
decision to extend its Commitments. Each Lender also acknowledges that it will,
independently of each Managing Agent and each other Lender, and based on such
other documents, information and investigations as it shall deem appropriate at
any time, continue to make its own credit decisions as to exercising or not
exercising from time to time any rights and privileges available to it under the
Loan Documents.
SECTION 9.7. Copies, etc. The Administrative Agent shall give prompt
notice to each Lender of each notice or request required or permitted to be
given to the Administrative Agent by the Borrower pursuant to the terms of the
Loan Documents (unless concurrently delivered to the Lenders by the Borrower).
The Administrative Agent will distribute to each Lender each document or
instrument received for its account and copies of all other communications
received by the Administrative Agent from the Borrower for distribution to the
Lenders by the Administrative Agent in accordance with the terms of the Loan
Documents.
SECTION 9.8. Reliance by Managing Agents and Issuers. Each Managing Agent
and each Issuer shall be entitled to rely upon any certification, notice or
other communication (including any thereof by telephone, telecopy, telegram or
cable) believed by it to be genuine and correct and to have been signed or sent
by or on behalf of the proper Person, and upon advice and statements of legal
counsel, independent accountants and other experts selected by such Managing
Agent or such Issuer, as the case may be. As to any matters not expressly
provided for by the Loan Documents, each Managing Agent and each Issuer shall in
all cases be fully protected in acting, or in refraining from acting, hereunder
or thereunder in accordance with instructions given by the Required Lenders or
all of the Lenders as is required in such circumstance, and such instructions of
such Lenders and any action taken or failure to act pursuant thereto shall be
binding on all Secured Parties. For purposes of applying amounts in accordance
with this Section, each Managing Agent shall be entitled to rely upon any
Secured Party that has entered into a Rate Protection Agreement with any Obligor
for a determination (which such Secured Party agrees to provide or cause to be
provided upon request of the Administrative Agent) of the outstanding
Obligations owed to such Secured Party under any Rate Protection Agreement.
Unless it has actual knowledge evidenced by way of written notice from any such
Secured Party and the Borrower to the contrary, each Managing Agent, in acting
in such capacity under the Loan Documents, shall be entitled to assume that no
Rate Protection Agreements or Obligations in respect thereof are in existence or
outstanding between any Secured Party and any Obligor.
SECTION 9.9. The Managing Agents and the Issuers. Notwithstanding
anything else to the contrary contained in any Loan Document, the Managing
Agents and the Issuers, in their respective capacities as such, shall have no
duties or responsibilities under any Loan Document nor any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into any Loan
Document or otherwise exist against either Managing Agent or any Issuer, as
applicable, in such capacity, except as are explicitly set forth in any such
Loan Document.
SECTION 9.10. Documentation Agent. The Lender identified on the signature
pages of this Agreement as the "Documentation Agent" shall not have any right,
power, obligation, liability, responsibility or duty under this Agreement (or
any other Loan Document) other than those applicable to all Lenders as such.
Without limiting the foregoing, the Lender so identified as the "Documentation
Agent" shall not have or be deemed to have any fiduciary relationship with any
other Lender. Each Lender acknowledges that it has not relied, and will not
rely, on the Lender so identified as the "Documentation Agent" in deciding to
enter into this Agreement and each other Loan Document to which it is a party or
in taking or not taking action hereunder or thereunder.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Waivers, Amendments, etc. The provisions of each Loan
Document (other than Rate Protection Agreements, under which amendments,
modifications and waivers may be effected by the Applicable Obligor and
Applicable Lender, each a party thereto) may from time to time be amended,
modified or waived, if such amendment, modification or waiver is in writing and
consented to by the Borrower and the Required Lenders; provided, however, that
no such amendment, modification or waiver shall:
(a) modify this Section without the consent of all Lenders;
(b) increase the aggregate amount of any Credit Extensions required
to be made by a Lender pursuant to its Commitments, extend any final
Commitment Termination Date or reduce any fees described in Article III
payable to any Lender without the consent of such Lender;
(c) extend any scheduled date of payment of principal for any
Lender's Loan, or reduce the principal amount of, rate of interest or fees
on any Loan or Reimbursement Obligations (which shall in each case include
the conversion of all or any part of the Obligations into equity of any
Obligor), or extend the scheduled date on which interest or fees are
payable in respect of such Loan or Reimbursement Obligation, in each case,
without the consent of the Lender which has made such Loan or, in the case
of a Reimbursement Obligation, the applicable Issuer owed, and those
Lenders participating in, such Reimbursement Obligation (it being
understood and agreed, however, that any vote to rescind any acceleration
made pursuant to Sections 8.2 and 8.3 of amounts owing with respect to the
Loans and other Obligations shall only require the vote of the Required
Lenders);
(d) reduce the percentage set forth in the definition of "Required
Lenders" or modify any requirement hereunder that any particular action be
taken by all Lenders without the consent of all Lenders;
(e) except as otherwise expressly provided in a Loan Document
(including the sale or transfer of Accounts and other related assets in
accordance with the Permitted Receivables Transaction), release (i) the
Borrower from its Obligations under the Loan Documents or any Subsidiary
Guarantor from its Obligations under the Subsidiary Guaranty, as
applicable (other than in connection with a Disposition of all or
substantially all of the Capital Securities of a Subsidiary Guarantor in a
transaction permitted by Section 7.2.10 or 7.2.11) or (ii) all or
substantially all of the collateral under the Loan Documents, in each case
without the consent of all Lenders;
(f) (i) amend, modify or waive clause (b) of Section 3.1.1 or (ii)
have the effect (either immediately or at some later time) of enabling the
Borrower to satisfy a condition precedent to the making of a Revolving
Loan or the issuance of a Letter of Credit unless such amendment,
modification or waiver shall have been consented to by the Lenders holding
a majority of the aggregate amount of the then outstanding Revolving Loan
Commitments.
(g) change any of the terms of Section 2.3.2 without the consent of
the Swing Line Lender;
(h) amend, modify or waive the provisions of clause (b) of Section
3.1.2 or effect any amendment, modification or waiver that by its terms
adversely affects the rights of Lenders participating in any Tranche
differently from those of Lenders participating in other Tranches, unless
such amendment, modification or waiver shall have been consented to by the
holders of at least a majority of the aggregate amount of Loans
outstanding under the Tranche or Tranches affected by such modification,
or, in the case of a modification affecting the Revolving Loan
Commitments, the Lenders holding a majority of the aggregate amount of the
then outstanding Revolving Loan Commitments;
(i) affect adversely the interests, rights or obligations of either
Managing Agent (in its capacity as a Managing Agent) or any Issuer, unless
consented to by such Managing Agent or such Issuer, as the case may be;
(j) amend, modify or waive the provisions of Section 9.10, without
the consent of Harris Trust and Savings Bank, so long as such financial
institution is a Lender hereunder; or
(k) with respect to any LIBO Rate Loan, amend, waive or modify the
requirement that the Interest Period relative to any such Loan be one,
two, three or six months in duration, unless consented to by each Lender
making such Loan.
No failure or delay on the part of either Managing Agent, any Issuer or any
Lender in exercising any power or right under any Loan Document shall operate as
a waiver thereof, nor shall any single or partial exercise of any such power or
right preclude any other or further exercise thereof or the exercise of any
other power or right. No notice to or demand on any Obligor in any case shall
entitle it to any notice or demand in similar or other circumstances. No waiver
or approval by either Managing Agent, any Issuer or any Lender under any Loan
Document shall, except as may be otherwise stated in such waiver or approval, be
applicable to subsequent transactions. No waiver or approval hereunder shall
require any similar or dissimilar waiver or approval thereafter to be granted
hereunder.
For purposes of this Section, the Syndication Agent, in coordination with
the Administrative Agent, shall have primary responsibility, together with the
Borrower, in the negotiation, preparation and documentation relating to any
amendment, modification or waiver under this Agreement, any other Loan Document
or any other agreement or document related hereto or thereto contemplated
pursuant to this Section.
SECTION 10.2. Notices; Time. All notices and other communications
provided under each Loan Document shall be in writing or by facsimile and
addressed, delivered or transmitted, if to the Borrower or either Managing
Agent, at its address or facsimile number set forth on Schedule II hereto, and
if to a Lender or Issuer, to the applicable Person at its address or facsimile
number set forth on Schedule II hereto or set forth in the Lender Assignment
Agreement pursuant to which such Lender became a Lender hereunder, or, in any
case, at such other address or facsimile number as may be designated by any such
party in a notice to the other parties. Any notice, if mailed and properly
addressed with postage prepaid or if properly addressed and sent by pre-paid
courier service, shall be deemed given when received; any notice, if transmitted
by facsimile, shall be deemed given when the confirmation of transmission
thereof is received by the transmitter. Unless otherwise indicated, all
references to the time of a day in a Loan Document shall refer to Boston,
Massachusetts time.
SECTION 10.3. Payment of Costs and Expenses. The Borrower agrees to pay
on demand all reasonable fees and expenses of the Managing Agents (including the
fees and out-of-pocket expenses of Mayer, Brown & Platt, counsel to the
Syndication Agent and Lead Arranger, Palmer & Dodge LLP, counsel to the
Administrative Agent, and of local counsel, if any, who may be retained by or on
behalf of the Managing Agents) in connection with
(a) the negotiation, preparation, execution and delivery of each
Loan Document, including schedules and exhibits, and any amendments,
waivers, consents, supplements or other modifications to any Loan Document
as may from time to time hereafter be required, whether or not the
transactions contemplated hereby are consummated;
(b) the filing, recording, refiling or rerecording of any Loan
Document (including the Filing Statements) and all amendments,
supplements, amendment and restatements and other modifications to any
thereof, searches made following the Closing Date in jurisdictions where
Filing Statements (or other documents evidencing Liens in favor of the
Secured Parties) have been filed or recorded and any and all other
documents or instruments of further assurance required to be filed or
recorded, or refiled or rerecorded by the terms of any Loan Document; and
(c) the preparation and review of the form of any document or
instrument relevant to any Loan Document.
The Borrower further agrees to pay, and to save each Secured Party harmless from
all liability for, any stamp or other Taxes which may be payable in connection
with the execution or delivery of each Loan Document, the Credit Extensions or
the issuance of the Notes. The Borrower also agrees to reimburse each Secured
Party upon demand for all reasonable out-of-pocket expenses (including
reasonable attorneys' fees and legal expenses of counsel to each Secured Party)
incurred by such Secured Party in connection with (x) the negotiation of any
restructuring or "work-out" with the Borrower, whether or not consummated, of
any Obligations and (y) the enforcement of any Obligations.
SECTION 10.4. Indemnification. In consideration of the execution and
delivery of this Agreement by each Secured Party, the Borrower hereby
indemnifies, exonerates and holds each Secured Party and each of their
respective officers, directors, employees and agents (collectively, the
"Indemnified Parties") free and harmless from and against any and all actions,
causes of action, suits, losses, costs, liabilities and damages, and expenses
incurred in connection therewith (irrespective of whether any such Indemnified
Party is a party to the action for which indemnification hereunder is sought),
including reasonable attorneys' fees and disbursements, whether incurred in
connection with actions between or among the parties hereto or the parties
hereto and third parties (collectively, the "Indemnified Liabilities"), incurred
by the Indemnified Parties or any of them as a result of, or arising out of, or
relating to
(a) any transaction financed or to be financed in whole or in part,
directly or indirectly, with the proceeds of any Credit Extension,
including all Indemnified Liabilities arising in connection with the
Transaction;
(b) the entering into and performance of any Loan Document by any of
the Indemnified Parties (including any action brought by or on behalf of
the Borrower as the result of any determination by the Required Lenders
pursuant to Article V not to fund any Credit Extension, provided that any
such action is resolved in favor of such Indemnified Party);
(c) any investigation, litigation or proceeding related to any
acquisition or proposed acquisition by any Obligor or any Subsidiary
thereof of all or any portion of the Capital Securities or assets of any
Person, whether or not an Indemnified Party is party thereto;
(d) any investigation, litigation or proceeding (including any
threatened investigation, litigation or proceeding) related to any
environmental cleanup, audit, compliance or other matter relating to any
Obligor or any Subsidiary with respect to the protection of the
environment or relating to the Release by any Obligor or any Subsidiary
thereof of any Hazardous Material;
(e) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from, any real
property owned or operated by any Obligor or any Subsidiary of any
Hazardous Material (including any losses, liabilities, damages, injuries,
costs, expenses or claims asserted or arising under any Environmental
Law), regardless of whether caused by, or within the control of, such
Obligor or such Subsidiary; or
(f) each Lender's Environmental Liability (the indemnification
herein shall survive repayment of the Obligations and any transfer of the
property of any Obligor or any of its Subsidiaries by foreclosure or by a
deed in lieu of foreclosure for any Lender's Environmental Liability,
regardless of whether caused by, or within the control of, such Obligor or
such Subsidiary);
except for Indemnified Liabilities arising for the account of a particular
Indemnified Party by reason of the relevant Indemnified Party's gross negligence
or wilful misconduct. Except with respect to such gross negligence or wilful
misconduct, each Obligor and its successors and assigns hereby waive, release
and agree not to make any claim or bring any cost recovery action against, any
Indemnified Party under CERCLA or any state equivalent, or any similar law now
existing or hereafter enacted. It is expressly understood and agreed that to the
extent that any Indemnified Party is strictly liable under any Environmental
Laws, each Obligor's obligation to such Indemnified Party under this indemnity
shall likewise be without regard to fault on the part of any Obligor with
respect to the violation or condition which results in liability of an
Indemnified Party. If and to the extent that the foregoing undertaking may be
unenforceable for any reason, each Obligor agrees to make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law.
SECTION 10.5. Survival. The obligations of the Borrower under Sections
4.3,4.4, 4.5, 4.6, 10.3 and 10.4, and the obligations of the Lenders under
Section 9.1, shall in each case survive any assignment from one Lender to
another (in the case of Sections 10.3 and 10.4) and the occurrence of the
Termination Date. The representations and warranties made by each Obligor in
each Loan Document shall survive the execution and delivery of such Loan
Document.
SECTION 10.6. Severability. Any provision of any Loan Document which is
prohibited or unenforceable in any jurisdiction shall, as to such provision and
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of such Loan
Document or affecting the validity or enforceability of such provision in any
other jurisdiction.
SECTION 10.7. Headings. The various headings of each Loan Document are
inserted for convenience only and shall not affect the meaning or interpretation
of such Loan Document or any provisions thereof.
SECTION 10.8. Execution in Counterparts, Effectiveness, etc. This
Agreement may be executed by the parties hereto in several counterparts, each
of which shall be an original (whether such counterpart is originally executed
or an electronic copy of an original and each party hereto expressly waives its
rights to receive originally executed documents other than with respect to any
Notes)and all of which shall constitute together but one and the same agreement.
This Agreement shall become effective when counterparts hereof executed on
behalf of the Borrower, each Managing Agent and each Lender (or notice
thereof satisfactory to the Managing Agents) shall have been received by the
Managing Agents.
SECTION 10.9. Governing Law; Entire Agreement. EACH LOAN DOCUMENT
(OTHER THAN THE LETTERS OF CREDIT, TO THE EXTENT SPECIFIED BELOW AND EXCEPT AS
OTHERWISE EXPRESSLY SET FORTH IN A LOAN DOCUMENT) WILL EACH BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK). EACH LETTER OF CREDIT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OR RULES DESIGNATED IN
SUCH LETTER OF CREDIT, OR IF NO LAWS OR RULES ARE DESIGNATED, THE INTERNATIONAL
STANDBY PRACTICES (ISP98--INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NUMBER
590 (THE "ISP RULES")) AND, AS TO MATTERS NOT GOVERNED BY THE ISP RULES, THE
INTERNAL LAWS OF THE STATE OF NEW YORK. The Loan Documents constitute the entire
understanding among the parties hereto with respect to the subject matter
thereof and supersede any prior agreements, written or oral, with respect
thereto.
SECTION 10.10. Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that the Borrower may not assign or
transfer its rights or obligations hereunder without the consent of all of the
Lenders.
SECTION 10.11. Sale and Transfer of Credit Extensions; Participations in
Credit Extensions Notes. Each Lender may assign, or sell participations in, its
Loans, Letters of Credit and Commitments to one or more other Persons in
accordance with this the terms set forth below.
SECTION 10.11.1. Assignments. Any Lender (an "Assignor Lender"),
pursuant to a Lender Assignment Agreement,
(a) with the written consent of the Borrower, each Managing Agent
and, in the case of assignments of Revolving Loans and Letters of Credit,
the Issuers (which consent(s) (i) shall not be unreasonably delayed or
withheld and (ii) of the Borrower shall not be required upon the
occurrence and during the continuance of any Default or Event of Default),
may at any time assign and delegate to one or more commercial banks, other
financial institutions or funds that are regularly engaged in making,
purchasing or investing in loans or securities; and
(b) with written notice to the Borrower, each Managing Agent and, in
the case of assignments of Revolving Loans and Letters of Credit, the
Issuers (but without the consent of any such Person), may assign and
delegate to any of its Affiliates or Related Funds or to any other Lender
or any Affiliate or Related Fund of any other Lender;
(each Person described in either of the foregoing clauses as being the Person to
whom such assignment and delegation is to be made, being hereinafter referred to
as an "Assignee Lender"), all or any fraction of such Assignor Lender's Loans
and Commitments (and in the case of any assignment of Revolving Loan
Commitments, related participations in Letters of Credit and Letter of Credit
Outstandings) (which assignment and delegation shall be, as among Revolving Loan
Commitments, Revolving Loans and participations in Letters of Credit and Letter
of Credit Outstandings, of a constant, and not a varying, percentage) is in a
minimum aggregate amount of (i) $2,500,000, in the case of Term Loans and Term
Loan Commitments, and $5,000,000, in the case of Revolving Loans and Revolving
Loan Commitments (provided, that (1) assignments that are made on the same day
to a Related Fund may be treated as a single assignment for purposes of the
minimum amount and (2) no minimum amount shall be required in the case of any
assignment between two Lenders so long as the Assignor Lender has an aggregate
amount of Loans and Commitments of at least $5,000,000 following such
assignment), unless the Borrower and the Administrative Agent otherwise consent
or (ii) the then remaining amount of such Assignor Lender's Loans and
Commitments; provided, however, that any such Assignee Lender will comply, if
applicable, with the provisions contained in Section 4.6 and each Obligor and
the Administrative Agent shall be entitled to continue to deal solely and
directly with such Assignor Lender in connection with the interests so assigned
and delegated to an Assignee Lender until
(A) written notice of such assignment and delegation, together with
payment instructions, addresses and related information with respect to
such Assignee Lender, shall have been delivered to the Borrower and the
Administrative Agent by such Assignor Lender and such Assignee Lender;
(B) such Assignee Lender shall have executed and delivered to the
Borrower and each Managing Agent a Lender Assignment Agreement, accepted
by each Managing Agent;
(C) the processing fees described below shall have been paid; and
(D) the Administrative Agent shall have registered such assignment
and delegation in the Register pursuant to clause (b) of Section 2.7.
From and after the date that the Administrative Agent accepts such Lender
Assignment Agreement and such assignment and delegation is registered pursuant
to clause (b) of Section 2.7, (x) the Assignee Lender thereunder shall be deemed
automatically to have become a party hereto and to the extent that rights and
obligations hereunder have been assigned and delegated to such Assignee Lender
in connection with such Lender Assignment Agreement, shall have the rights and
obligations of a Lender hereunder and under the other Loan Documents, and (y)
the Assignor Lender, to the extent that rights and obligations hereunder have
been assigned and delegated by it in connection with such Lender Assignment
Agreement, shall be released from its obligations hereunder and under the other
Loan Documents. Any Assignor Lender that shall have previously requested and
received any Note or Notes in respect of any Tranche to which any such
assignment applies shall, upon the acceptance by the Administrative Agent of the
applicable Lender Assignment Agreement, mark such Note or Notes "exchanged" and
deliver them to the Borrower (against, if the Assignor Lender has retained Loans
or Commitments with respect to the applicable Tranche and has requested
replacement Notes pursuant to clause (c) of Section 2.7, its receipt from the
Borrower of replacement Notes in the principal amount of the Loans and
Commitments of the applicable Tranche retained by it). Such Assignor Lender or
such Assignee Lender (unless the Assignor Lender or the Assignee Lender is DLJ
or one of its Affiliates) must also pay a processing fee to the Administrative
Agent upon delivery of any Lender Assignment Agreement in the amount of $3,500,
unless such assignment and delegation is by a Lender to its Affiliate or Related
Fund or if such assignment and delegation is by a Lender to a Federal Reserve
Bank, as provided below or is otherwise consented to by the Administrative
Agent. Any attempted assignment and delegation not made in accordance with this
Section shall be null and void. Nothing contained in this Section shall prevent
or prohibit any Lender from pledging its rights (but not its obligations to make
Loans or participate in Letters of Credit or Letter of Credit Outstandings)
under this Agreement and/or its Loans hereunder to a Federal Reserve Bank in
support of borrowings made by such Lender from such Federal Reserve Bank and any
Lender that is a fund that invests in bank loans may pledge all or any portion
of its rights (but not its obligations to make Loans or participate in Letters
of Credit or Letter of Credit Outstandings) hereunder to any trustee or any
other holder or representative of holders of obligations owed or securities
issued by such fund as security for such obligations or securities. In the event
that S&P, Moody's or Thompson's BankWatch (or InsuranceWatch Ratings Service, in
the case of Lenders that are insurance companies (or Best's Insurance Reports,
if such insurance company is not rated by Insurance Watch Ratings Service))
shall, after the date that any Lender with a Commitment to make Revolving Loans
or participate in Letters of Credit or Letter of Credit Outstandings becomes a
Lender, downgrade the long-term certificate of deposit rating or long-term
senior unsecured debt rating of such Lender, and the resulting rating shall be
below BBB-, Baa3 or C (or BB, in the case of Lender that is an insurance company
(or B, in the case of an insurance company not rated by InsuranceWatch Ratings
Service)) respectively, then any Issuer or the Borrower shall have the right,
but not the obligation, upon notice to such Lender and the Administrative Agent,
to replace such Lender with an Assignee Lender in accordance with and subject to
the restrictions contained in this Section, and such Lender hereby agrees to
transfer and assign without recourse (in accordance with and subject to the
restrictions contained in this Section) all its interests, rights and
obligations in respect of its Revolving Loan Commitment under this Agreement to
such Assignee Lender; provided, however, that (i) no such assignment shall
conflict with any law, regulation or order of any Governmental Authority and
(ii) such Assignee Lender shall pay to such Lender in immediately available
funds on the date of such assignment the principal of and interest and fees (if
any) accrued to the date of payment on the Loans made, and Letters of Credit
participated in, by such Lender hereunder and all other amounts accrued for such
Lender's account or owed to it hereunder.
SECTION 10.11.2. Participations. Any Lender may sell to one or more
commercial banks or other Persons (each of such commercial banks and other
Persons being herein called a "Participant") participating interests in any of
the Loans, Commitments, or other interests of such Lender hereunder; provided,
however, that
(a) no participation contemplated in this Section shall relieve such
Lender from its Commitments or its other obligations under any Loan
Document;
(b) such Lender shall remain solely responsible for the performance
of its Commitments and such other obligations;
(c) each Obligor and each Managing Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's
rights and obligations under each Loan Document;
(d) no Participant, unless such Participant is an Affiliate of such
Lender or is itself a Lender, shall be entitled to require such Lender to
take or refrain from taking any action under any Loan Document, except
that such Lender may agree with any Participant that such Lender will not,
without such Participant's consent, take any actions of the type described
in clauses (a), (b), (c) or (f) of Section 10.1 with respect to
Obligations participated in by such Participant; and
(e) the Borrower shall not be required to pay any amount under this
Agreement that is greater than the amount which it would have been
required to pay had no participating interest been sold.
The Borrower acknowledges and agrees that each Participant, for purposes of
Sections 4.3, 4.4, 4.5, 4.6, 4.8, 4.9, 7.1.1, 10.3 and 10.4, shall be considered
a Lender. Each Participant shall only be indemnified for increased costs
pursuant to Section 4.3, 4.5 or 4.6 if and to the extent that the Lender which
sold such participating interest to such Participant concurrently is entitled to
make, and does make, a claim on the Borrower for such increased costs. Any
Lender that sells a participating interest in any Loan, Commitment or other
interest to a Participant under this Section shall indemnify and hold harmless
the Borrower and the Administrative Agent from and against any Taxes, penalties,
interest or other costs or losses (including reasonable attorneys' fees and
expenses) incurred or payable by the Borrower or the Administrative Agent as a
result of the failure of the Borrower or the Administrative Agent to comply with
its obligations to deduct or withhold any Taxes from any payments made pursuant
to this Agreement to such Lender or the Administrative Agent, as the case may
be, which Taxes would not have been incurred or payable if such Participant had
been a Non-Domestic Lender that was entitled to deliver to the Borrower, the
Administrative Agent or such Lender, and did in fact so deliver, a duly
completed and valid Form W-8BEN or W-8ECI (or applicable successor form)
entitling such Participant to receive payments under this Agreement without
deduction or withholding of any United States federal Taxes.
Each Lender shall, as agent of the Borrower solely for the purpose of this
Section, record in book entries maintained by such Lender the name and the
amount of the participating interest of each Participant entitled to receive
payments in respect of any participating interests sold pursuant to this
Section.
SECTION 10.12. Other Transactions. Nothing contained herein shall
preclude any Managing Agent, any Issuer or any other Lender from engaging
in any transaction, in addition to those contemplated by the Loan Documents,
with the Borrower or any of its Affiliates in which the Borrower or such
Affiliate is not restricted hereby from engaging with any other Person.
SECTION 10.13. Independence of Covenants. All covenants contained in
this Agreement and each other Loan Document shall be given independent effect
such that, in the event 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 be
otherwise within the limitations of, another covenant shall not, unless
expressly so provided in such first covenant, avoid the occurrence of a Default
or an Event of Default if such action is taken or such condition exists.
SECTION 10.14. Confidentiality. (a) Subject to the provisions of clause
(b)of this Section, each Lender agrees that it will use its reasonable best
efforts not to disclose without the prior consent of the Borrower (other than to
its employees, auditors, advisors or counsel or to another Lender if the Lender
or such Lender's holding or parent company in its sole discretion determines
that any such party should have access to such information, provided such
Persons shall be subject to the provisions of this Section to the same extent as
such Lender) any information which is now or in the future furnished pursuant to
this Agreement or any other Loan Document, provided that any Lender may disclose
any such information (i) as has become generally available to the public other
than by virtue of a breach of this clause by the respective Lender or any other
Person to whom such Lender has provided such information as permitted by this
Section, (ii) as may be required or appropriate in any report, statement or
testimony submitted to any municipal, state or Federal regulatory body having or
claiming to have jurisdiction over such Lender or to the Federal Reserve Board
or the Federal Deposit Insurance Corporation or similar organizations (whether
in the United States or elsewhere) or their successors, (iii) as may be required
or appropriate in respect to any summons or subpoena or in connection with any
litigation, (iv) in order to comply with any law, order, regulation or ruling
applicable to such Lender, (v) to either Managing Agent, (vi) to any prospective
or actual transferee or participant in connection with any contemplated transfer
or participation of any of the Notes or Commitments or any interest therein by
such Lender, provided that such prospective transferee agrees to be bound by the
confidentiality provisions contained in this Section, (vii) to any direct or
indirect contractual counterparty in swap agreements or such contractual
counterparty's professional advisor (so long as such contractual counterparty or
professional advisor to such contractual counterparty agrees to be bound by the
provisions of this Section) and (viii) to the NAIC or any similar organization
or any nationally recognized rating agency that requires access to information
about a Lender's investment portfolio in connection with ratings issued with
respect to such Lender.
(b) The Borrower hereby acknowledges and agrees that each Lender may share
with any of its Affiliates, and such Affiliates may share with such Lender, any
information related to the Borrower or any of its Subsidiaries, provided such
Persons shall be subject to the provisions of this Section to the same extent as
such Lender.
SECTION 10.15. Forum Selection and Consent to Jurisdiction. ANY
LITIGATIONBASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, ANY
LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
ORAL OR WRITTEN) OR ACTIONS OF THE MANAGING AGENTS, THE LENDERS, THE ISSUER OR
THE BORROWER IN CONNECTION HEREWITH OR THEREWITH MAY BE BROUGHT AND MAINTAINED
IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
MANAGING AGENTS' OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL
OR OTHER PROPERTY MAY BE FOUND. THE BORROWER IRREVOCABLY CONSENTS TO THE SERVICE
OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR
WITHOUT THE STATE OF NEW YORK AT THE ADDRESS FOR NOTICES SPECIFIED IN SECTION
10.2. THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE
TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED
TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM. TO THE EXTENT THAT THE BORROWER HAS OR HEREAFTER MAY ACQUIRE
ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF
EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, THE BORROWER
HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW SUCH IMMUNITY
IN RESPECT OF ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS.
SECTION 10.16. Waiver of Jury Trial. EACH MANAGING AGENT, EACH LENDER, THE
ISSUER AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES
TO THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHTS THEY MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, EACH LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF SUCH MANAGING AGENT,
SUCH LENDER, THE ISSUER OR THE BORROWER IN CONNECTION THEREWITH. THE BORROWER
ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION
FOR THIS PROVISION (AND EACH OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO
WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR EACH
MANAGING AGENT, EACH LENDER AND THE ISSUER ENTERING INTO THE LOAN DOCUMENTS.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of December
, 1999.
- ---
OUTSOURCING SOLUTIONS INC.
By:/s/ Eric R. Fencl
-----------------------------------
Title: V.P./General Counsel
DLJ CAPITAL FUNDING, INC.,
as the Syndication Agent
By: /s/ James L. Paradise
----------------------------------
Title: Senior Vice President
FLEET NATIONAL BANK,
as the Administrative Agent
By: /s/
----------------------------------
Title: Managing Director
HARRIS TRUST AND SAVINGS BANK,
as the Documentation Agent
By: /s/
----------------------------------
Title: Vice President
LENDERS:
DLJ CAPITAL FUNDING, INC.
By: /s/ James L. Paradise
----------------------------------
Title: Senior Vice President
FLEET NATIONAL BANK
By: /s/
----------------------------------
Title: Director
HARRIS TRUST AND SAVINGS BANK
By: /s/
----------------------------------
Title: Vice President
BANK OF AMERICA
By: /s/
----------------------------------
Title: Vice President
BANK ONE, NA (FORMERLY KNOWN AS THE
FIRST NATIONAL BANK OF CHICAGO)
By: /s/
----------------------------------
Title: Senior Vice President
THE CHASE MANHATTAN BANK
By: /s/ William J. Caggiano
----------------------------------
Title: Managing Director
DRESDNER BANK AG, NEW YORK & GRAND
CAYMAN BRANCHES
By: /s/ John W. Sweeney
----------------------------------
Title: Vice President
By: /s/ John R. Morrison
----------------------------------
Title: Vice President
LASALLE BANK NATIONAL ASSOCIATION
By: /s/ Andrew G. Pollack
----------------------------------
Title: Corporate Banking Officer
Leveraged Finance
WACHOVIA BANK, N.A.
By: /s/
----------------------------------
Title: Senior Vice President
WELLS FARGO BANK, N.A.
By: /s/
----------------------------------
Title: Vice President