EXECUTION
EXHIBIT 10.27
CREDIT AGREEMENT
DATED AS OF JULY 10, 1998
BY AND AMONG
GEOLOGISTICS CORPORATION,
AS BORROWER
ING (U.S.) CAPITAL CORPORATION,
AS ADMINISTRATIVE AGENT
AND
THE LENDERS PARTY HERETO
TABLE OF CONTENTS
PAGE
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ARTICLE I DEFINITIONS AND ACCOUNTING TERMS. . . . . . . . . . . . . . . . 1
1.1 Defined Terms. . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Use of Defined Terms . . . . . . . . . . . . . . . . . . . . . . 25
1.3 Accounting Terms . . . . . . . . . . . . . . . . . . . . . . . . 25
1.4 Exhibits and Schedules . . . . . . . . . . . . . . . . . . . . . 26
1.5 Miscellaneous Terms. . . . . . . . . . . . . . . . . . . . . . . 26
ARTICLE II THE LOAN . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.1 The Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
ARTICLE III PAYMENTS AND FEES . . . . . . . . . . . . . . . . . . . . . . 29
3.1 Principal and Interest.. . . . . . . . . . . . . . . . . . . . . 29
3.2 Upfront Fees . . . . . . . . . . . . . . . . . . . . . . . . . . 30
3.3 Increased Costs. . . . . . . . . . . . . . . . . . . . . . . . . 30
3.4 Computation of Interest and Fees . . . . . . . . . . . . . . . . 34
3.5 Manner and Treatment of Payments . . . . . . . . . . . . . . . . 34
3.6 Failure to Charge Not Subsequent Waiver. . . . . . . . . . . . . 36
3.7 Administrative Agent's Right to Assume Payments Will Be Made by
the Company. . . . . . . . . . . . . . . . . . . . . . . . . . . 36
3.8 Fee and Cost Determination Detail. . . . . . . . . . . . . . . . 37
3.9 Survivability. . . . . . . . . . . . . . . . . . . . . . . . . . 37
ARTICLE IV REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . 38
4.1 Solvency . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
4.2 Existence and Qualification, Power, Compliance with Laws. . . . 38
4.3 Authority; Compliance with Other Agreements and Instruments and
Government Regulations . . . . . . . . . . . . . . . . . . . . . 39
4.4 No Governmental Approvals Required . . . . . . . . . . . . . . . 39
4.5 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . 40
4.6 Financial Statements . . . . . . . . . . . . . . . . . . . . . . 41
4.7 No Other Liabilities; No Material Adverse Effect.. . . . . . . . 41
4.8 Title to Property. . . . . . . . . . . . . . . . . . . . . . . . 41
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4.9 Intangible Assets. . . . . . . . . . . . . . . . . . . . . . . . 41
4.10 Governmental Regulation. . . . . . . . . . . . . . . . . . . . . 42
4.11 Litigation.. . . . . . . . . . . . . . . . . . . . . . . . . . . 42
4.12 Binding Obligations. . . . . . . . . . . . . . . . . . . . . . . 42
4.13 No Default.. . . . . . . . . . . . . . . . . . . . . . . . . . . 42
4.14 ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
4.15 Regulations T, U and X . . . . . . . . . . . . . . . . . . . . . 44
4.16 Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
4.17 Tax Liability. . . . . . . . . . . . . . . . . . . . . . . . . . 44
4.18 Projections. . . . . . . . . . . . . . . . . . . . . . . . . . . 45
4.19 Employee Matters . . . . . . . . . . . . . . . . . . . . . . . . 45
4.20 Hazardous Materials. . . . . . . . . . . . . . . . . . . . . . . 46
4.21 Labor Disputes. . . . . . . . . . . . . . . . . . . . . . . . . 46
ARTICLE V COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
5.1 Payment of Notes.. . . . . . . . . . . . . . . . . . . . . . . . 47
5.2 SEC Reports. . . . . . . . . . . . . . . . . . . . . . . . . . . 47
5.3 Limitation on Indebtedness.. . . . . . . . . . . . . . . . . . . 47
5.4 Limitations on Restricted Payments.. . . . . . . . . . . . . . . 49
5.5 Limitation on Distributions from Restricted Subsidiaries . . . . 52
5.6 Limitation on Sales of Assets and Subsidiary Stock . . . . . . . 53
5.7 Limitation on Transactions with Affiliates . . . . . . . . . . . 54
5.8 Compliance Certificates. . . . . . . . . . . . . . . . . . . . . 56
5.9 Further Instruments and Acts . . . . . . . . . . . . . . . . . . 56
5.10 Limitation on Liens. . . . . . . . . . . . . . . . . . . . . . . 56
5.11 Limitation on Sale\Leaseback Transactions. . . . . . . . . . . . 58
5.13 Payment of Taxes and Other Claims. . . . . . . . . . . . . . . . 58
5.14 Corporate Existence. . . . . . . . . . . . . . . . . . . . . . . 58
5.15 Future Guarantors. . . . . . . . . . . . . . . . . . . . . . . . 59
5.16 Merger, Consolidation and Sale of Assets . . . . . . . . . . . . 59
ARTICLE VI CONDITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . 62
6.1 Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
ARTICLE VII EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT . . . . . 65
7.1 Events of Default. . . . . . . . . . . . . . . . . . . . . . . . 65
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7.2 Remedies upon Event of Default . . . . . . . . . . . . . . . . . 66
ARTICLE VIII THE ADMINISTRATIVE AGENT . . . . . . . . . . . . . . . . . . 69
8.1 Appointment and Authorization. . . . . . . . . . . . . . . . . . 69
8.2 Administrative Agent and Affiliates. . . . . . . . . . . . . . . 69
8.3 Proportionate Interest of the Lenders in Any Collateral. . . . . 69
8.4 Lenders' Credit Decisions. . . . . . . . . . . . . . . . . . . . 70
8.5 Action by Administrative Agent . . . . . . . . . . . . . . . . . 70
8.6 Liability of Administrative Agent. . . . . . . . . . . . . . . . 71
8.7 Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . 72
8.8 Successor Administrative Agent . . . . . . . . . . . . . . . . . 73
8.9 No Obligations of the Company. . . . . . . . . . . . . . . . . . 74
ARTICLE IX MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . 75
9.1 Cumulative Remedies: No Waiver . . . . . . . . . . . . . . . . . 75
9.2 Amendment: Consents. . . . . . . . . . . . . . . . . . . . . . . 75
9.3 Costs, Expenses and Taxes. . . . . . . . . . . . . . . . . . . . 76
9.4 Nature of Lenders' Obligations . . . . . . . . . . . . . . . . . 77
9.5 Survival of Representations and Warranties . . . . . . . . . . . 77
9.6 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
9.7 Execution of Loan Documents. . . . . . . . . . . . . . . . . . . 78
9.8 Binding Effect; Assignment . . . . . . . . . . . . . . . . . . . 78
9.9 Sharing of Setoffs . . . . . . . . . . . . . . . . . . . . . . . 81
9.10 Indemnity. . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
9.11 Nonliability of the Lenders. . . . . . . . . . . . . . . . . . . 84
9.12 No Third Parties Benefited . . . . . . . . . . . . . . . . . . . 85
9.13 Confidentiality. . . . . . . . . . . . . . . . . . . . . . . . . 85
9.14 Integration. . . . . . . . . . . . . . . . . . . . . . . . . . . 86
9.15 Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . 87
9.16 Severability of Provisions . . . . . . . . . . . . . . . . . . . 87
9.17 Independent Representations, Warranties, and Covenants . . . . . 87
9.18 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
9.19 Time of the Essence. . . . . . . . . . . . . . . . . . . . . . . 87
9.20 Submission to Jurisdiction . . . . . . . . . . . . . . . . . . . 87
9.21 Purported Oral Amendments. . . . . . . . . . . . . . . . . . . . 88
9.22 Replacement of a Lender. . . . . . . . . . . . . . . . . . . . . 88
9.23 Waiver of Right to Trial by Jury . . . . . . . . . . . . . . . . 88
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EXHIBITS
Exhibit A Assignment and Acceptance
Exhibit B Compliance Certificate
Exhibit C Form of Notes
Exhibit D Pricing Designation
SCHEDULES
4.5 Subsidiaries and Other Investments
4.7 Other Liabilities
4.9 Intangible Assets
4.11 Litigation
4.14 ERISA
4.18 Projections
4.19 Labor Matters
4.20 Hazardous Materials
4.21 Labor Disputes
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CREDIT AGREEMENT
Dated as of July 10, 1998
This CREDIT AGREEMENT ("Agreement") is entered into by and among
GeoLogistics Corporation, a Delaware corporation (the "Company"), ING (U.S.)
Capital Corporation ("ING Capital") and each other lender whose name is set
forth on the signature pages hereof or which may hereafter execute and deliver
an instrument of assignment with respect to this Agreement pursuant to Section
9.8 (collectively, the "Lenders" and, individually, a "Lender"), and ING
Capital, as Administrative Agent. In consideration of the premises and for other
good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1 DEFINED TERMS. As used in this Agreement, the following terms
shall have the meanings set forth below:
"ADDITIONAL ASSETS" means (i) any property or assets (other than
Indebtedness and Capital Stock) in a business related to, ancillary to or
complementary to the business of the Company as of the Senior Note Issue Date (a
"Related Business"), (ii) the Capital Stock of a Person that becomes a
Restricted Subsidiary as a result of the acquisition of such Capital Stock by
the Company or another Restricted Subsidiary or (iii) Capital Stock constituting
a minority interest in any Person that at such time is a Restricted Subsidiary;
PROVIDED, HOWEVER, that, any such Restricted Subsidiary described in clause
(ii) or (iii) above is primarily engaged in a Related Business.
"ADMINISTRATIVE AGENT" means ING Capital, when acting in its capacity
as the Administrative Agent under any of the Loan Documents, and any successor
Administrative Agent.
"ADMINISTRATIVE AGENT'S OFFICE" means the Administrative Agent's
address as set forth on the signature pages of this Agreement, or such other
address as the Administrative Agent may designate by written notice to the
Company and the Lenders.
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"AFFILIATE" means, as to any Person, any other Person which
directly or indirectly controls, or is under common control with, or is
controlled by, such Person. As used in this definition, "control" (and the
correlative terms "controlled by" and "under common control with") shall mean
possession, directly or indirectly, of power to direct or cause the direction
of management or policies (whether through ownership of securities or
partnership or other ownership interests, by contract or otherwise); PROVIDED
that, in any event, any Person that owns, directly or indirectly, 10% or more
of the securities having ordinary voting power for the election of directors
or other governing body of a corporation that has more than 100 record
owners, or 10% or more of the partnership or other ownership interests of any
other Person that has more than 100 record owners, will be deemed to control
such corporation or other Person.
"AGENT'S LETTER" means the letter agreement dated as of the Closing
Date between the Company and the Administrative Agent.
"AGREEMENT" means this Credit Agreement, either as originally
executed or as it may from time to time be supplemented, modified, amended,
restated or extended.
"ASSET DISPOSITION" means any sale, lease, transfer or other
disposition (or series of related sales, leases, transfers or dispositions)
by the Company or any Restricted Subsidiary, including any disposition by
means of a merger or consolidation (each referred to for the purposes of this
definition as a "disposition"), of (i) any shares of Capital Stock of a
Restricted Subsidiary (other than directors' qualifying shares or shares
required by applicable Law to be held by a Person other than the Company or a
Restricted Subsidiary), (ii) all or substantially all the assets (other the
Capital Stock of an Unrestricted Subsidiary) of any division or line of
business of the Company or any Restricted Subsidiary or (iii) any other
assets (other than Capital Stock of an Unrestricted Subsidiary) of the
Company or any Restricted Subsidiary outside of the ordinary course of
business of the Company or such Restricted Subsidiary (other than, in the
case of (i), (ii) and (iii) above, (x) a disposition by a Restricted
Subsidiary to the Company or by the Company or a Restricted Subsidiary to a
Restricted Subsidiary and (y) for purposes of Section 5.6 only, a disposition
that constitutes a Restricted Payment permitted by Section 5.4 or a
disposition specifically excepted form the definition of Restricted Payment)
PROVIDED, HOWEVER, that Asset Disposition shall not include (a) a transaction
or series of related transactions for which the Company or its Restricted
Subsidiaries receive aggregate consideration less than or equal to
$1,000,000, (b) the sale, lease, conveyance, disposition or other transfer of
all or substantially all of the assets of the Company to the
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extent permitted hereby, or (c) the disposition of assets of the Company or
any Restricted Subsidiary for aggregate non-cash consideration not in excess
of $20,000,000 so long as the pro forma Consolidated Coverage Ratio after
giving effect to any such disposition is at least 2.5 to 1.0. The foregoing
shall not apply to any Lien granted on the Capital Stock of a Restricted
Subsidiary.
"ATTRIBUTABLE DEBT" in respect of a Sale/Leaseback Transaction
means, as at the time of determination, the present value (discounted at the
stated interest rate of the Senior Notes, compounded annually) of the total
obligations of the lessee for rental payments during the remaining term of
the lease included in such Sale/Leaseback Transaction (including any period
for which such lease has been extended).
"BANK CREDIT AGREEMENT" means the Amended and Restated Loan
Agreement dated as of October 28, 1997 among the Company, Matrix
International Logistics, Inc., a Delaware corporation, LEP Profit
International, Inc. a Delaware corporation, The Bekins Company, a Delaware
corporation, ILLCAN, Inc., a Delaware corporation, and ILLSCOT, Inc., a
Delaware corporation (collectively, the Domestic Borrowers"), LEP
International Limited, a company organized under the Laws of England ("LEP
UK" and collectively with the Domestic Borrowers, "Borrowers"), the Lenders
therein named, ING (U.S.) Capital Corporation, as Administrative Agent, and
ING Bank, N.V., as heretofore amended, as such agreement, in whole or in
part, may hereafter be further amended, renewed, extended, increased,
substituted, refinanced, restructured, replaced (including, without
limitation, any successive renewals, extensions, increases, substitutions,
refinancings, restructurings, replacements, supplements or other
modifications of the foregoing).
"BANK CREDIT AGREEMENT SCHEDULES" means the Schedules to the Bank
Credit Agreement, as originally executed.
"BASE RATE" means the arithmetic average of the rates of interest
publicly announced by The Chase Manhattan Bank, Citibank, N.A. and Morgan
Guaranty Trust Company of New York (or their respective successors) as their
respective prime commercial lending rates (or, as to any such bank that does
not announce such a rate, such bank's "base" or other rate determined by the
Administrative Agent to be the equivalent rate announced by such bank),
except that, if any such bank shall, for any period, cease to announce
publicly its prime commercial lending (or equivalent) rate, the
Administrative Agent shall, during such period, determine the "Prime Rate"
based upon
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the prime commercial lending (or equivalent) rates announced publicly by the
other such banks.
"BASE RATE TRANCHE" means a portion of the Loan as to which
interest is calculated with reference to the Base Rate.
"BEST KNOWLEDGE" means, where it modifies a statement that, after
reasonable inquiry, nothing has come to the attention of any Senior Officer
of the Company or any relevant Restricted Subsidiary which would render the
statement incorrect or misleading in any respect.
"BOARD OF DIRECTORS" means the Board of Directors of the Company or
any committee thereof duly authorized to act on behalf of such Board.
"BREAKAGE FEE" means the fee set forth in Section 3.3(g) hereof.
"BUSINESS DAY" means any Monday, Tuesday, Wednesday, Thursday or
Friday, OTHER THAN a day on which banks are authorized or required to be
closed in New York, Los Angeles or Chicago or a day on which any of the
Lenders' relevant U.S. offices are closed.
"CANADIAN SUBSIDIARY" means any Subsidiary of the Company which is
incorporated or continued under the laws of Canada or any province of Canada.
"CAPITAL LEASE" means, as to any Person, a lease of any Property by
that Person as lessee that is, or should be, in accordance with Financial
Accounting Standards Board Statement No. 13, as amended from time to time,
or, if such Statement is not then in effect, such other statement of GAAP as
may be applicable, recorded as a "capital lease" on the balance sheet of that
Person prepared in accordance with GAAP.
"CAPITAL LEASE OBLIGATIONS" means an obligation that is required to
be classified and accounted for as a capital lease for financial reporting
purposes in accordance with GAAP, and the amount of Indebtedness represented
by such obligation shall be the capitalized amount of such obligations
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 penalty.
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"CAPITAL STOCK" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of
or interests in (however designed) equity of such person, including any
Preferred Stock, but excluding any debt securities convertible into such
equity.
"CARIBBEAN AIR SERVICES" means Caribbean Air Services, Inc., a
Delaware corporation, its successors and permitted assigns.
"CAS PURCHASE AGREEMENT" means that certain Asset Purchase
Agreement dated as of June 15, 1998 among Caribbean Air Services, Inc., a
Delaware corporation, Amertranz Worldwide Holding Corp., a Delaware
corporation and the Company, as in effect on June 15, 1998.
"CASH" means, when used in connection with any Person, all monetary
and nonmonetary items owned by that Person that are treated as cash in
accordance with GAAP.
"CERTIFICATE OF A RESPONSIBLE OFFICIAL" means a certificate signed
by a Responsible Official of the Person providing the certificate.
"CHANGE OF CONTROL EVENT" means the occurrence of (a) any "Change
of Control Event" as defined in the Bank Credit Agreement or (b) any other
event or circumstance involving a change in the ownership, management, or
board of directors of the Company the occurrence of which (i) entitles the
holders of Indebtedness under the Bank Credit Agreement, or any other
Indebtedness of the Company in an amount which is in excess of $50,000,000
which has directly or indirectly refinanced the Bank Credit Agreement, to
require (whether immediately or following the passage of time) the repayment
of such Indebtedness, or (ii) requires the Company to make an offer to
purchase the Senior Notes.
"CLOSING DATE" means the date upon which the conditions set forth
in Section 6.1 are satisfied and the Loan is made.
"CODE" means the Internal Revenue Code of 1986, as amended or
replaced and as in effect from time to time.
"COMMISSION" means the Securities and Exchange Commission.
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"ASSIGNMENT AND ACCEPTANCE" means an Assignment and Acceptance
substantially in the form of Exhibit A.
"COMPLIANCE CERTIFICATE" means a certificate in the form of Exhibit
B, properly completed and signed by a Senior Officer of the Company.
"CONSOLIDATED COVERAGE RATIO" as of any date of determination means
the ratio of (i) the aggregate amount of EBITDA for the period of the most
recent four consecutive fiscal quarters ending at least 45 days (or, if less
than 45 days after the end of such fiscal quarter, ending as of the date the
consolidated financial statements of the Company shall be available) prior to
the date of such determination to (ii) Consolidated Interest Expense for such
four fiscal quarters; PROVIDED, HOWEVER, that (1) if the Company or any
Restricted Subsidiary (x) has Incurred any Indebtedness (other than
Indebtedness Incurred for working capital purposes under a Bank Credit
Agreement) since the beginning of such period that remains outstanding or if
the transaction giving rise to the need to calculate the Consolidated
Coverage Ratio is an Incurrence of Indebtedness, or both, EBITDA and
Consolidated Interest Expense for such period shall be calculated after
giving effect on a pro forma basis to such Indebtedness as if such
Indebtedness had been Incurred on the first day of such period and the
discharge of any other Indebtedness repaid, repurchased, defeased or
otherwise discharged with the proceeds of such new Indebtedness as if such
discharge had occurred on the first day of such period or (y) has repaid,
repurchased, defeased or otherwise discharged any Indebtedness since the
beginning of the period that is no longer outstanding on such date of
determination, or if the transaction giving rise to the need to calculate the
Consolidated Coverage Ratio involves a discharge of Indebtedness, EBITDA and
Consolidated Interest Expense for such period shall be calculated after
giving effect to such discharge of such Indebtedness, including with the
proceeds of such new Indebtedness, as if such discharge had occurred on the
first day of such period (except that, in making such computation, the amount
of Indebtedness under any revolving credit facility shall be computed based
upon the average daily balance of such Indebtedness during such four quarter
period), (2) if since the beginning of such period the Company or any
Restricted Subsidiary shall have made any Asset Disposition, the EBITDA for
such period shall be reduced by an amount equal to the EBITDA (if positive)
directly attributable to the assets which are the subject of such Asset
Disposition for such period, or increased by an amount equal to the EBITDA
(if negative) directly attributable thereto for such period and Consolidated
Interest Expense for such period shall be reduced by an amount equal to the
Consolidated Interest
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Expense directly attributable to any Indebtedness of the Company or any
Restricted Subsidiary repaid, repurchased, defeased or otherwise discharged
with respect to the Company and its continuing Restricted Subsidiaries in
connection with such Asset Disposition for such period (or, if the Capital
Stock of any Restricted Subsidiary is sold, the Consolidated Interest Expense
for such period directly attributable to the Indebtedness of such Restricted
Subsidiary to the extent the Company and its continuing Restricted
Subsidiaries are no longer liable for such Indebtedness after such sale), (3)
if since the beginning of such period the Company or any Restricted
Subsidiary (by merger or otherwise) shall have made an Investment in any
Restricted Subsidiary (or any Person which becomes a Restricted Subsidiary)
or an acquisition of assets, including any acquisition of assets occurring in
connection with a transaction requiring a calculation to be made hereunder,
which constitutes all or substantially all of an operating unit of a
business, EBITDA and Consolidated Interest Expense for such period shall be
calculated after giving pro forma effect thereto (including the Incurrence of
any Indebtedness) as if such Investment or acquisition occurred on the first
day of such period or (4) if since the beginning of such period any Person
(that subsequently became a Restricted Subsidiary or was merged with or into
the Company or any Restricted Subsidiary since the beginning of such period)
shall have made any Asset Disposition, Investment or acquisition of assets
that would have required an adjustment pursuant to clause (2) or (3) above if
made by the Company or a Restricted Subsidiary during such period, EBITDA and
Consolidated Interest Expense for such period shall be calculated after
giving pro forma effect thereto as if such Asset Disposition, Investment or
acquisition occurred on the first day of such period. For purposes of this
definition, whenever pro forma effect is to be given to an acquisition of
assets, the amount of income or earnings relating thereto and the amount of
Consolidated Interest Expense associated with any Indebtedness Incurred in
connection therewith, the pro forma calculations shall be determined in good
faith by a responsible financial or accounting Responsible Official of the
Company. If any Indebtedness bears a floating rate of interest and is being
given pro forma effect, the interest on such Indebtedness shall be calculated
as if the rate in effect on the date of determination had been the applicable
rate for the entire period (taking into account any Interest Rate Agreement
applicable to such Indebtedness if such Interest Rate Agreement has a
remaining term in excess of 12 months).
"CONSOLIDATED INTEREST EXPENSE" means, for any period, the total
interest expense of the Company and its consolidated Restricted Subsidiaries,
plus, to the extent not included in such total interest expense, and to the
extent incurred by the Company or its Restricted Subsidiaries, (i) interest
expense attributable to Capital Lease Obligations,
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(ii) amortization of debt discount and debt issuance costs, (iii) capitalized
interest, (iv) non-cash interest expense, (v) commissions, discounts and
other fees and charges owed with respect to letters of credit and bankers'
acceptance financing, (vi) net costs associated with Hedging Obligations
(including amortization of fees), (vii) dividends paid or payable in respect
of any Disqualified Stock of the Company, (viii) cash dividends paid or
payable by the Company and all dividends paid or payable by Restricted
Subsidiaries, in each case in respect of all Preferred Stock held by Persons
other than the Company or a Wholly Owned Subsidiary, (ix) interest incurred
in connection with Investments in discontinued operations and (x) interest
accruing on any Indebtedness of any other Person to the extent such
Indebtedness is Guaranteed by the Company or any Restricted Subsidiary.
"CONSOLIDATED NET INCOME" means, for any period, the net income of
the Company and its consolidated Subsidiaries; PROVIDED, HOWEVER, that there
shall not be included in such Consolidated Net Income: (i) any net income of
any Person if such Person is not a Restricted Subsidiary, except that (A)
subject to the exclusion contained in clause (iv) below, the Company's equity
in the net income of any such Person for such period shall be included in
such Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Person during such period to the Company or a Restricted
Subsidiary as a dividend or other distribution (subject, in the case of a
dividend or other distribution paid to a Restricted Subsidiary, to the
limitations contained in clause (iii) below) and (B) with respect to the
calculation of EBITDA only, the Company's equity in a net loss of any such
Person for such period shall be included in determining such Consolidated Net
Income up to the aggregate amount invested by the Company or any Restricted
Subsidiary in such Person during such period; (ii) any net income (or loss)
of any Person acquired by the Company or a Subsidiary of the Company in a
pooling of interests transaction for any period prior to the date of such
acquisition; (iii) any net income of any Restricted Subsidiary to the extent
that such Restricted Subsidiary is subject to restrictions, directly or
indirectly, prohibiting the payment of dividends, the repayment of
intercompany debt and the making of distributions by such Restricted
Subsidiary, directly or indirectly, to the Company, except that (A) subject
to the exclusion contained in clause (iv) below, the Company's equity in the
net income of any such Restricted Subsidiary for such period shall be
included in such Consolidated Net Income up to the aggregate amount of cash
actually distributed by such Restricted Subsidiary during such period to the
Company or another Restricted Subsidiary as a dividend or other distribution
(subject, in the case of a dividend or other distribution paid to another
Restricted Subsidiary, to the limitation contained in this clause) and (B)
the Company's
-8-
equity in a net loss of any such Restricted Subsidiary for such period shall
be included in determining such Consolidated Net Income up to the aggregate
amount invested by the Company or any Restricted Subsidiary in such Person
during such period; (iv) any gain or loss realized upon the sale or other
disposition of any assets of the Company or its consolidated Subsidiaries
(including pursuant to any sale-and-leaseback arrangement) which is not sold
or otherwise disposed of in the ordinary course of business and any gain or
loss realized upon the sale or other disposition of any Capital Stock of any
Person; (v) extraordinary gains or losses; and (vi) the cumulative effect of
a change in accounting principles.
"CONSOLIDATED NET WORTH" means the total of the amounts shown on
the balance sheet of the Company and its Restricted Subsidiaries, determined
on a consolidated basis in accordance with GAAP, as of the most recent fiscal
quarter of the Company for which financial statements are available, as (i)
the par or stated value of all outstanding Capital Stock of the Company plus
(ii) paid-in capital or capital surplus relating to such Capital Stock plus
(iii) any retained earnings or earned surplus less (A) any accumulated
deficit and (B) any amounts attributable to Disqualified Stock.
"CONTINGENT OBLIGATION" means, as to any Person, any (a) direct or
indirect guaranty of Indebtedness of, or other obligation performable by, any
other Person, INCLUDING any endorsement (other than for collection or deposit
in the ordinary course of business), co-making or sale with recourse of the
obligations of any other Person or (b) contractual assurance (not arising
solely by operation of Law) given to an obligee with respect to the
performance of an obligation by, or the financial condition of, any other
Person, whether direct, indirect or contingent, INCLUDING any purchase or
repurchase agreement covering such obligation or any collateral security
therefor, any agreement to provide funds (by means of loans, capital
contributions or otherwise) to such other Person, any agreement to support
the solvency or level of any balance sheet item to such other Person, or any
other arrangement of whatever nature having the effect of assuring or holding
harmless any obligee against loss with respect to any obligation of such
other Person including without limitation any "keep-well", "take-or-pay" or
"through-put" agreement or arrangement. The amount of any Contingent
Obligation issued in support of Indebtedness shall be deemed to be an amount
equal to the stated or determinable amount of the related primary obligation
(unless the Contingent Obligation is limited by its terms to a lesser amount,
in which case to the extent of such amount) or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
as determined by the Person in good faith. The amount of any other
Contingent Obligation
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shall be zero until and unless, pursuant to GAAP, an amount in respect of
such Contingent Obligation is required to be included on the face of the
balance sheet of such Person (and not merely as a note thereto), at which
time the amount of such Contingent Obligation shall be the amount so required
to be included.
"CONTRACTUAL OBLIGATION" means, as to any Person, any provision of any
outstanding Securities issued by that Person or of any material agreement,
instrument or undertaking to which that Person is a party or by which it or any
of its Property is bound.
"CREDITORS" means, collectively, the Administrative Agent and each
Lender.
"CURRENCY AGREEMENT" means, in respect of a Person, any foreign
exchange contract, currency swap arrangement or other similar agreement to which
such a Person is a party or a beneficiary.
"CUSTODIAN" means any receiver, Administrative Agent, assignee,
liquidator, custodian or similar official under any Bankruptcy Law.
"DEBTOR RELIEF LAWS" means the Bankruptcy Code of the United States of
America, the Bankruptcy and Insolvency Act of Canada, the Companies' Creditors
Arrangement Act of Canada and the Winding-Up Act of Canada, The Insolvency Act
1986 and the Companies Act of 1985 (as amended by the Companies Act of 1989) of
England and Wales), as amended from time to time, and all other applicable
liquidation, conservatorship, bankruptcy, moratorium, rearrangement,
receivership, insolvency, reorganization, or similar debtor relief Laws,
including corporation Laws, from time to time in effect affecting the rights of
creditors generally.
"DEFAULT" means any event that, with the giving of any applicable
notice or passage of time specified in Section 7.1, or both, would be an Event
of Default.
"DISQUALIFIED STOCK" means, with respect to any Person, any Capital
Stock which by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable) or upon the happening of any event
(other than as a result of a Change of Control Event) (i) matures or is
mandatorily redeemable pursuant to a sinking fund obligation or otherwise,
(ii) is convertible into or exchangeable for Indebtedness or Disqualified Stock
or (iii) is redeemable at the option of the holder thereof, in whole or in part,
in each case on or prior to the Maturity Date; PROVIDED, HOWEVER, that any
Capital
-10-
Stock that would not constitute Disqualified Stock but for provisions thereof
giving holders thereof the right to require such Person to repurchase or
redeem such Capital Stock upon the occurrence of an "asset sale" or "change
of control" occurring prior to the Maturity Date shall not constitute
Disqualified Stock if the "asset sale" or "change of control" provisions
applicable to such Capital Stock are not more favorable to the holders of
such Capital Stock than the provisions described under Section 5.6.
"DOLLARS" or "'$" means United States dollars.
"EBITDA" for any period means the sum of Consolidated Net Income
plus Consolidated Interest Expense plus the following to the extent deducted
in calculating such Consolidated Net Income: (a) all income tax expense of
the Company, (b) depreciation expense, (c) amortization expense, and (d) all
other non-cash items reducing such Consolidated Net Income (excluding any
non-cash item to the extent it represents an accrual of, or reserve for, cash
disbursement for any subsequent period) less all non-cash items increasing
such Consolidated Net Income (such amount calculated pursuant to this clause
(d) not to be less than zero), in each case for such period. Notwithstanding
the foregoing, the provision for taxes based on the income or profits of, and
the depreciation and amortization of, a Subsidiary of the Company shall be
added to Consolidated Net Income to compute EBITDA only to the extent (and in
the same proportion) that the net income of such Subsidiary was included in
calculating Consolidated Net Income.
"ERISA" means the Employee Retirement Income Security Act of 1974,
and any regulations issued pursuant thereto, as amended or replaced and as in
effect from time to time.
"ERISA AFFILIATE" means, with respect to any Person, any Person or
any trade or business (whether or not incorporated) that is under common
control with that Person within the meaning of Section 414(b) or (c) of the
Code.
"EURODOLLAR RATE" means, for any Interest Period for any Eurodollar
Tranche, a rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) equal to the offered rate for deposits in Dollars (in the same
approximate amount and having approximately the same maturity as the
Eurodollar Tranche to be made) in the London interbank eurodollar market at
approximately 11:00 a.m. (London time), which appears on the Telerate Screen
3750 or, if such rate does not appear on the Telerate
-11-
Screen, such rate as determined in good faith by the Administrative Agent,
two Business Days prior to the first day of the Interest Period for such
Eurodollar Tranche.
"EURODOLLAR TRANCHE" means a portion of the Loan as to which
interest is calculated with reference to the Eurodollar Rate.
"EVENT OF DEFAULT" shall have the meaning provided in Section 7.1
"FEDERAL FUNDS RATE" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to (a) the weighted
average of the rates on overnight federal funds transactions with members of
the Federal Reserve System arranged by federal funds brokers, as published
for such day (or, if such day is not a Business Day, for the preceding
Business Day) by the Federal Reserve Bank of New York, or (b) if such rate is
not so published for any day which is a Business Day, the average of the
quotations at approximately 11 a.m. (New York time) for such day on such
transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by it.
"FOREIGN CREDIT AGREEMENT" means any revolving credit agreement,
invoice discounting, overdraft or guarantee facility or other similar
arrangement providing for the Incurrence of Indebtedness by any Foreign
Subsidiary, and the agreements governing such Indebtedness which may, in
whole or in part, be amended, renewed, extended, substituted, refinanced,
restructured, replaced (including, without limitation, any successive
renewals, extensions, substitutions, refinancing, restructuring, replacement,
supplements or other modifications of the foregoing).
"FOREIGN SUBSIDIARY" means a Restricted Subsidiary that is
incorporated in a jurisdiction other than the United States or a State
thereof or the District of Columbia and with respect to which more than 80%
of any of its sales, earnings or assets (determined on a consolidated basis
in accordance with GAAP) are located in, generated from or derived from
operations located in territories outside the United States of America and
jurisdictions outside the United States of America.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Senior Note Issue Date, including
those set forth (i) in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants,
(ii) in statements and
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pronouncements of the Financial Accounting Standards Board, (iii) in such
other statements by such other entity as approved by a significant segment of
the accounting profession, and (iv) in the rules and regulations of the SEC
governing the inclusion of financial statements (including pro forma
financial statements) in periodic reports required to be filed pursuant to
Section 13 of the Exchange Act, including opinions and pronouncements in
staff accounting bulletins and similar written statements from the accounting
staff of the SEC.
"GOVERNMENTAL AGENCY" means any international, foreign, federal,
state, provincial, county or municipal government, or political subdivision
thereof, any governmental or quasi-governmental agency, authority, board,
bureau, commission, department, instrumentality or public body, any court,
administrative tribunal or public utility or any arbitration tribunal or
other nongovernmental authority to whose jurisdiction a Person has consented.
"GUARANTOR SUBSIDIARIES" means, as of each date of determination,
each of the Domestic Borrowers under the Bank Credit Agreement and each
Subsidiary of the Company which has executed a guaranty of the obligations
under the Bank Credit Agreement as of that date (other than LEP Canada,
except to the extent required by Section 5.15(b)).
"GUARANTY" means the Guaranty issued by each Guarantor Subsidiary
of the obligations of the Company hereunder, executed on the Closing Date in
favor of the Administrative Agent, for the benefit of the Creditors, as the
same may from time to time be modified by the execution of an Instrument of
Joinder in the form of Exhibit A thereto in accordance with Section 5.15, and
as the same may from time to time be supplemented, modified, amended,
renewed, extended or supplanted.
"HAZARDOUS MATERIALS" means any pollutants, contaminants,
hazardous, toxic or special wastes, substances or materials, defined or
regulated as such in (or for purposes of) any environmental Law, including,
without limitation, any asbestos, any petroleum (including crude oil or any
fraction), any radioactive substance and any polychlorinated byphenyls;
PROVIDED, in the event that any environmental Law is amended so as to broaden
the meaning of any term defined thereby, such broader meaning shall apply
subsequent to the effective date of such amendment; and PROVIDED further, to
the extent that the applicable Laws of the United States or Canada or any
province or state establish a meaning for "hazardous material," "hazardous
substance,"
-13-
"hazardous waste," "solid waste," "contaminant," "pollutant," or "toxic
substance" which is broader than that specified in any environmental Law,
such broader meaning shall apply.
"HAZARDOUS MATERIALS LAWS" means applicable provisions of the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
as amended ("CERCLA"), the Resource Conservation and Recovery Act of 1976, as
amended ("RCRA"), any "Superfund" law, the Hazardous Materials Transportation
Act, as amended, the Occupational Safety and Health Act, as amended ("OSHA"),
the Hazardous Waste Control Law, California Health Safety Code, as amended,
Environment Quality Act (Quebec) and regulations adopted thereunder,
Transportation of Dangerous Goods Act (Canada), the Environmental Protection
Act (Ontario), Transportation of Dangerous Goods Regulation (Canada),
Transportation of Dangerous Substances Regulation (Quebec), Canadian
Environmental Protection Act (Canada), the Environmental Act 1995, the
Environmental Protection Act of 1990 and the Planning (Hazardous Substances)
Act of 1990 or England and Wales, and any other applicable United States,
English, Welsh or Canadian federal, state, provincial, municipal or local
law, statute, rule, regulation, ordinance, order, judgement, decree, permit,
license or other binding determination of any Governmental Agency, as now or
at any time hereafter amended or in effect and applicable to any Party,
regulating, relating to or imposing liability or standards of conduct
concerning the manufacture, processing, distribution, use, treatment,
handling, storage, disposal, or transportation of Hazardous Materials, or air
emissions, water discharges or otherwise concerning the protection of the
outdoor or indoor environment.
"HEDGING OBLIGATIONS" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement or Currency Agreement.
"INCUR" means to issue, assume, guarantee (or otherwise incur
Contingent Obligations with respect to), incur or otherwise become liable for
Indebtedness; PROVIDED, HOWEVER, that any Indebtedness of a Person existing
at the time such Person becomes a Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to be Incurred by
such Subsidiary at the time it becomes a Subsidiary. The term "Incurrence"
when used as a noun shall have a correlative meaning. The accretion of
principal in a non-interest bearing or other discount security shall be
deemed the Incurrence of Indebtedness.
-14-
"INDEBTEDNESS" means, as to any Person, (a) all indebtedness of
such Person for borrowed money, (b) that portion of the obligations of such
Person under Capital Leases that is properly recorded as a liability on a
balance sheet of that Person prepared in accordance with GAAP, (c) any
obligation of such Person that is evidenced by a promissory note or other
instrument representing an extension of credit to such Person, whether or not
for borrowed money, (d) any obligation of such Person for the deferred
purchase price of Property or services (OTHER THAN trade or other accounts
payable in the ordinary course of business in accordance with customary
terms), (e) any obligation of such Person that is secured by a Lien on the
assets of such Person, whether or not that Person has assumed such obligation
and whether or not such obligation is nonrecourse to the credit of such
Person, but only to the extent of the fair market value of the assets so
subject to the Lien, (f) obligations of such Person arising under acceptance
facilities or under facilities for the discount of accounts receivable of
such Person, (g) obligations of such Person for unreimbursed draws under
letters of credit issued for the account of such Person and (h) the net
obligations of such Person under any swap agreement. The term "Indebtedness"
excludes all obligations under operating leases, determined in accordance
with GAAP.
"INDENTURE" means the Indenture dated October 29, 1997 among the
Company, First Trust National Association, as trustee, as in effect on the
date of this Agreement.
"INTANGIBLE ASSETS" means general intangibles as such term is
defined in the Uniform Commercial Code.
"INTEREST PERIOD" means, as to each Eurodollar Tranche, the period
commencing and ending on the dates specified by the Company pursuant to
Section 2.1(b), which shall be seven days, fourteen days, one, two, three or
six months after the date such period commenced; PROVIDED that: (a) the first
day of any Interest Period shall be a Business Day; (b) any Interest Period
that would otherwise end on a day that is not a Business Day shall be
extended to the next-succeeding Business Day; and (c) no Interest Period
shall extend beyond the Maturity Date.
"INTEREST RATE AGREEMENT" means any interest rate swap agreement,
interest rate cap agreement or other financial agreement or arrangement
designed solely to protect the Company or any Restricted Subsidiary against
fluctuations in interest rates.
-15-
"INVESTMENT" means, when used in connection with any Person, any
investment by or of that Person, whether by means of purchase or other
acquisition of capital stock or other Securities of any other Person or by
means of loan, advance, capital contribution, guaranty or other debt or
equity participation or interest, or otherwise, in any other Person,
INCLUDING any partnership and joint venture interests of such Person in any
other Person. The amount of any Investment shall be the amount actually
invested, without adjustment for increases or decreases in the value of such
Investment.
"LAWS" means, collectively, all international, foreign, federal,
state, provincial and local statutes, treaties, rules, regulations,
ordinances, codes and administrative or judicial precedents.
"LENDERS" means each Lender which is an original signatory hereto
or which hereafter becomes a party hereto in accordance with Section 9.8.
"LEP CANADA" means LEP International, Co., a Nova Scotia unlimited
liability company, and its successors and permitted assigns. For purposes of
this Agreement, LEP Canada shall be deemed to be a Subsidiary of both ILLCAN,
Inc. and ILLSCOT, Inc.
"LIEN" means (whether choate or inchoate, crystallized or fixed,
for amounts due or accruing) any mortgage, deed of trust, pledge,
hypothecation, assignment for security, security interest, encumbrance, lien,
deemed trust, reservation, exception, easement, encroachment, title
exception, garnishment or distraint right, deposit arrangement, or charge of
any kind, whether voluntarily incurred or arising by operation of Law or
otherwise, affecting any Property, INCLUDING any agreement to grant any of
the foregoing, any conditional sale or other title retention agreement, any
lease in the nature of a security interest and/or the filing of or agreement
to give any financing statement, notice or registration (other than a
precautionary financing statement with respect to a lease that is not in the
nature of a security interest) under the Uniform Commercial Code.
"LOAN" means the $15,000,000 loan made by the Lenders pursuant to
Article II.
"LOAN DOCUMENTS" means, collectively, this Agreement, the Notes, the
Guaranties, and any other certificates, documents or agreements of any type or
nature executed and delivered by the Company or any of its Subsidiaries to any
of the Creditors
-16-
concurrently herewith or at any time in the future in furtherance of this
Agreement, either as originally executed or as the same may from time to time
be supplemented, modified, amended, restated, extended or supplanted.
"MAJORITY LENDERS" means, as of any date of determination, Lenders
whose aggregate Pro Rata Shares, in the aggregate, exceed 50%.
"MANAGEMENT AGREEMENTS" means (i) the Management Agreement dated
October 31, 1996 between William E. Simon & Sons, LLC and the Company and
(ii) the Management Agreement dated as of November 1, 1997 among the Company,
TCW Special Credits Fund V - The Principal Fund and Oaktree Capital
Management, LLC.
"MATERIAL ADVERSE EFFECT" means any set of circumstances or events
which (a) has or could reasonably be expected to have any material adverse
effect whatsoever upon the validity or enforceability of any Loan Document,
(b) is or could reasonably be expected to be material and adverse to the
condition (financial or otherwise) or business operations of the Company and
its Restricted Subsidiaries, taken as a whole, or the properties and assets
of the Company and its Restricted Subsidiaries taken as a whole, (c)
materially impairs or could reasonably be expected to materially impair the
ability of the Company and its Restricted Subsidiaries, taken as a whole, to
perform the Obligations, or (d) impairs or could reasonably be expected to
impair the ability of the Lenders to enforce their legal remedies pursuant to
the Loan Documents.
"MATURITY DATE" means October 15, 2007.
"MULTIEMPLOYER PLAN" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA.
"NET AVAILABLE CASH" from an Asset Disposition means cash payments
received therefrom (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or
otherwise, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring Person of
Indebtedness or other obligations relating to such properties or assets or
received in any other non-cash form) in each case net of (i) all legal, title
and recording tax expenses, brokerage commissions, underwriting discounts or
commissions or sales commissions and other reasonable fees and expenses
(including, without limitation, fees and expenses of counsel, accountants and
investment bankers) related to such Asset
-17-
Disposition or converting to cash any other proceeds received, and any
relocation and severance expenses as a result thereof, and all Federal,
state, provincial, foreign and local taxes required to be accrued or paid as
a liability under GAAP, as a consequence of such Asset Disposition, (ii) all
payments made on any Indebtedness which is secured by any assets subject to
such Asset Disposition or made in order to obtain a necessary consent to such
Asset Disposition or to comply with applicable law, (iii) all distributions
and other payments required to be made to minority interest holders in
Subsidiaries or joint ventures as a result of such Asset Disposition and (iv)
appropriate amounts provided by the seller as a reserve, in accordance with
GAAP, against any liabilities associated with the property or other assets
disposed of in such Asset Disposition and retained by the Company or any
Restricted Subsidiary after such Asset Disposition, including, without
limitation, pension and other post-employment benefit liabilities,
liabilities related to environmental matters and liabilities under any
indemnification obligations associated with such Asset Disposition. Further,
with respect to an Asset Disposition by a Subsidiary which is not a Wholly
Owned Subsidiary, Net Available Cash shall be reduced pro rata for the
portion of the equity of such Subsidiary which is not owned by the Company.
"NET CASH PROCEEDS," with respect to any issuance or sale of
Capital Stock, means the cash proceeds of such issuance or sale net of
attorneys' fees, accountants' fees, underwriters' or placement agents' fees,
discounts or commissions and brokerage, consultant and other fees actually
incurred in connection with such issuance or sale and net of taxes paid or
payable as a result thereof. In addition, for purposes of the calculations
described in Section 5.4, Net Cash Proceeds shall also mean any cash amounts
paid to the Company by members of management of the Company or its
Subsidiaries in respect of all promissory notes outstanding on the Senior
Note Issue Date and any amounts reflected on the records of the Company as
additional paid in capital or equity contributions made in respect of
employment-related stock price guarantees entered into prior to the Senior
Note Issue Date.
"NOTES" means, collectively, any of the promissory notes made by
the Company to a Lender evidencing that Lender's Pro Rata Share of the Loan,
substantially in the form of Exhibit C, either as originally executed or as
the same may from time to time be supplemented, modified, amended, renewed,
extended or supplanted.
"OBLIGATIONS" means all present and future obligations of every
kind or nature of the Company or any other Party at any time and from time to
time owed to the
-18-
Creditors or any one or more of them under any one or more of the Loan
Documents, whether due or to become due, matured or unmatured, liquidated or
unliquidated or contingent or noncontingent, INCLUDING obligations of
performance as well as obligations of payments and INCLUDING interest that
accrues after the commencement of any proceeding under any Debtor Relief Law
by or against the Company or any Party.
"OPINION OF COUNSEL" means the favorable written legal opinion
dated as of the Closing Date of Milbank, Tweed, Hadley & McCloy, special
counsel to the Company, together with copies of all factual certificates upon
which such counsel have relied.
"PARTY" means any Person other than the Creditors that now or
hereafter is a party to any of the Loan Documents.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereof established under ERISA.
"PENSION PLAN" means any "employee pension benefit plan" that is
subject to Title IV of ERISA and that is maintained for employees of the
Company or any of its ERISA Affiliates, other than a Multiemployer Plan.
"PERMITTED HOLDERS" means, collectively, the Sponsors and Roger E.
Payton.
"PERMITTED INVESTMENTS" means an Investment by the Company or any
Restricted Subsidiary in (i) a Restricted Subsidiary or a Person that will,
upon the making of such Investment, become a Restricted Subsidiary; PROVIDED,
HOWEVER, that the primary business of such Restricted Subsidiary is a Related
Business; (ii) another Person if as a result of such Investment such other
Person is merged or consolidated with or into, or transfers or conveys all or
substantially all of its assets to, the Company or a Restricted Subsidiary;
PROVIDED, HOWEVER, that such Persons's primary business is a Related
Business; (iii) cash equivalents; (iv) receivables owing to the Company or
any Restricted Subsidiary if created or acquired in the ordinary course of
business and payable or dischargeable in accordance with customary trade
terms; PROVIDED, HOWEVER, that such trade terms may include such
concessionary trade terms as the Company or any such Restricted Subsidiary
deems reasonable under the circumstances; (v) payroll, travel and similar
advances to cover matters that are expected at the time of such advances
ultimately to be treated as expenses for accounting purposes and that are
made in the ordinary course of business; (vi) loans or advances to employees
made in the ordinary
-19-
course of business consistent with past practices of the Company or such
Restricted Subsidiary, including without limitation, loans or advances made
to employees in respect of stock purchase or other employee benefit plans;
(vii) stock, obligations or securities received in settlement of debts
created in the ordinary course of business and owning to the Company or any
Restricted Subsidiary or in satisfaction or judgments and (viii) any Person
to the extent such Investment represents the non-cash portion of the
consideration received for a disposition of Assets as permitted under Section
5.6 and as described in clause (c) of the definition of Asset Disposition.
"PERMITTED LIENS" means, with respect to any Person, (a) pledges or
deposits by such Person under workers' compensation laws, unemployment
insurance laws or similar legislation, or good faith deposits in connection
with bids, tenders, contracts (other than for the payment of Indebtedness) or
leases to which such Person is a party, or deposits to secure public or
statutory obligations of such Person or deposits or cash or United States
government bonds to secure surety or appeal bonds to which such Person is a
party, or deposits as security for contested taxes or import duties or for
the payment of rent, in each case incurred in the ordinary course of
business; (b) Liens imposed by law, such as carriers', warehousemen's and
mechanics' Liens, in each case for sums not yet due or being contested in
good faith by appropriate proceedings; (c) Liens arising out of judgments or
awards against such Person with respect to which such Person shall then be
proceeding with an appeal or other proceedings for review or time for appeal
has not yet expired; (d) Liens for taxes, assessments or other governmental
charges not yet subject to penalties for non-payment or which are being
contested in good faith by appropriate proceedings; (e) Liens in favor or
issuers of surety bonds or letters of credit issued pursuant to the request
of and for the account of such Person in the ordinary course of its business;
PROVIDED, HOWEVER, that such letters of credit do not constitute
Indebtedness; (f) survey exceptions, encumbrances, easements or reservations
of, or rights of others for licenses, rights of way, sewers, electric lines,
telegraph and telephone lines and other similar purposes, or zoning or other
restrictions as to the use of real properties or Liens incidental to the
conduct of the business of such Person or to the ownership of its properties
which were not incurred in connection with Indebtedness and which do not in
the aggregate materially adversely affect the value of said properties or
materially impair their use in the operation of the business of such Person;
(g) Liens securing an Interest Rate Agreement so long as the related
Indebtedness is, and is permitted to be under this Agreement, secured by a
Lien on the same property securing the Interest Rate Agreement; and (h)
leases and subleases of real property which do not
-20-
interfere with the ordinary conduct of the business of such Person, and which
are made on customary and usual terms applicable to similar properties.
"PERMITTED RIGHT OF OTHERS" means a Right of Others consisting of
(a) an interest (other than a legal or equitable co-ownership interest, an
option or right to acquire a legal or equitable co-ownership interest and any
interest of a ground lessor under a ground lease) that does not materially
impair the value or use of property for the purposes for which it is or may
reasonably be expected to be held, (b) an option or right to acquire a Lien
that would be a Permitted Lien and (c) the reversionary interest of a
landlord under a lease of Property.
"PERSON" means any entity, whether an individual, trustee,
corporation, general partnership, limited partnership, limited liability
company, joint stock company, trust, estate, unincorporated organization,
business association, tribe, firm, joint venture, Governmental Agency or
otherwise.
"PRICING DESIGNATION" means a Pricing Designation, substantially in
the form of Exhibit D hereto, properly completed and signed by a Responsible
Official of the Company.
"PRO RATA SHARE" means, as to each Lender, the percentage interest
of that Lender in the Loan. As of the Closing Date, ING Capital is the
holder of a Pro Rata Share of 100%. From time to time following the Closing
Date, the Pro Rata Shares of each Lender shall be subject to adjustment in
connection with any assignment to which that Lender is a party in accordance
with Section 9.8.
"PROJECTIONS" means the financial projections attached hereto as
Schedule 4.18.
"PROPERTY" means any interest in any kind of property or asset,
whether real, personal or mixed, movable or immovable, or tangible or
intangible.
"QUARTERLY PAYMENT DATE" means each March 31, June 30, September 30
and December 31, commencing with the first such date to occur subsequent to
the Closing Date.
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"REFINANCING INDEBTEDNESS" has the meaning set forth for that term
in the Indenture.
"REGULATIONS D, T, U AND X" means, respectively, Regulations D, T,
U and X, as at any time amended, of the Board of Governors of the Federal
Reserve System, or any other regulations in substance substituted therefor.
"RELATED BUSINESS" means any business related, ancillary or
complementary to the businesses of the Company on the Senior Note Issue Date.
"REQUIREMENT OF LAW" means, as to any Person, the articles or
certificate of incorporation and bylaws or other organizational or governing
documents of such Person, and any Law, or judgment, award, decree, writ or
determination of a Governmental Agency, in each case applicable to or binding
upon such Person or any of its Property or to which such Person or any of its
Property is subject.
"RESPONSIBLE OFFICIAL" means, (a) when used with reference to a
Person other than an individual, any corporate officer of such Person,
general partner of such Person, corporate officer of a corporate general
partner of such Person, or corporate officer of a corporate general partner
of a partnership that is a general partner of such Person, or (for purposes
of Articles II and III only) any other responsible official thereof duly
acting on behalf thereof, and, (b) when used with reference to a Person who
is an individual, such Person. Any document or certificate hereunder that is
signed or executed by a Responsible Official of a Person shall be
conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of that Person.
"RESTRICTED PAYMENT" with respect to any Person means (i) the
declaration or payment of any dividends or any stock distributions of any
sort in respect of its Capital Stock (including any payment in connection
with any merger or consolidation involving such Person), other than dividends
or distributions payable solely in its Capital Stock (other than Disqualified
Stock) and dividends or distributions payable solely to the Company or a
Restricted Subsidiary, and other than pro rata dividends or other
distributions made by a Subsidiary that is not a Wholly Owned Subsidiary to
minority stockholders (or owners of an equivalent interest in the case of a
Subsidiary that is an entity other than a corporation), (ii) the purchase,
redemption or other acquisition or retirement for value of any Capital Stock
of the Company held by any Person or of any
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Capital Stock of a Restricted Subsidiary held by any Affiliate of the Company
(other than a Restricted Subsidiary), including the exercise of any option to
exchange any Capital Stock (other than into Capital Stock of the Company that
is not Disqualified Stock), (iii) the purchase, repurchase, redemption,
defeasance or other acquisition or retirement for value, prior to scheduled
maturity, scheduled repayment or scheduled sinking fund payment of any
Subordinated Obligations (other than the purchase, repurchase or other
acquisition of Subordinated Obligations purchased in anticipation of
satisfying of a sinking fund obligation, principal installment or final
maturity, in each case due within one year of the date of acquisition) or
(iv) the making of any Investment in any Person (other than a Permitted
Investment).
"RESTRICTED SUBSIDIARY" means each Subsidiary of the Company which
is not an Unrestricted Subsidiary.
"RIGHT OF OTHERS" means, as to any Property in which a Person has
an interest, (a) any legal or equitable right, title or other interest (OTHER
THAN a Lien) held by any other Person in or with respect to that Property and
(b) any option or right held by any other Person to acquire any right, title
or other interest in or with respect to that Property, INCLUDING any option
or right to acquire a Lien.
"SALE/LEASEBACK TRANSACTIONS" means an arrangement relating to
Property now owned or hereafter acquired whereby the Company or a Restricted
Subsidiary transfers such Property to a Person and the Company or a
Restricted Subsidiary leases back such Property from such Person.
"SECURITIES" means any capital stock, share, voting trust
certificate, bonds, debentures, notes or other evidences of indebtedness,
limited partnership interests or any warrant, option or other right to
purchase or acquire any of the foregoing.
"SENIOR NOTE ISSUE DATE" means October 28, 1997.
"SENIOR NOTES" means the 9 3/4% Senior Notes of the Company due
2007 issued pursuant to the Indenture.
"SENIOR OFFICER" means the (a) chief executive officer, (b) chief
operating officer, (c) chief financial officer or (d) president,
vice-president or treasurer of the Person designated.
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"SIGNIFICANT SUBSIDIARY" means any Restricted Subsidiary that would
be a "Significant Subsidiary" of the Company within the meaning of Rule 1-02
under Regulation S-X promulgated by the Commission.
"SOLVENT" as to any Person shall mean that (a) the sum of the
assets of such Person, both at a fair valuation and at present fair salable
value, will exceed its liabilities, including contingent liabilities, (b)
such Person will have sufficient capital with which to conduct its business
as presently conducted and as proposed to be conducted and (c) such Person
has not incurred debts, and does not intend to incur debts, beyond its
ability to pay such debts as they mature. For purposes of this definition,
"debt" means any liability on a claim, and "claim" means (x) a right to
payment, whether or not such right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
legal, equitable, secured, or unsecured, or (y) a fight to an equitable
remedy for breach of performance if such breach gives rise to a payment,
whether or not such right to an equitable remedy is reduced to judgment,
fixed, contingent, matured, unmatured, disputed, undisputed, secured or
unsecured. With respect to any such contingent liabilities, such liabilities
shall be computed at the amount which, in light of all the facts and
circumstances existing at the time, represents the amount which can
reasonably be expected to become an actual or matured liability.
"SPONSORS" means William E. Simon & Sons, LLC, TCW Special Credits
Fund V - The Principal Fund, OCM Principal Opportunities Fund, L.P. and any
of their respective affiliates.
"SUBORDINATED OBLIGATIONS" means (a) any Obligations and
Indebtedness of the Company and its Subsidiaries under the Management
Agreements, and (b) any other Indebtedness of the Company that is
subordinated to the Obligations, all of the provisions of which (including
amount, maturity, amortization, interest rate, covenants, defaults and
subordination) have been approved in writing as to form and substance by the
Administrative Agent with the consent of the Majority Lenders.
"SUBSIDIARY" means, as of any date of determination and with
respect to any Person, any other entity whose financial results are properly
consolidated with those of that Person in accordance with GAAP or which, (a)
in the case of a corporation, of which a majority of the securities having
ordinary voting power for the election of directors or other governing body
(other than securities having such power only by reason of the happening of a
contingency) are at the time beneficially owned by such Person and/or one
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or more Subsidiaries of such Person or, (b) in the case of a partnership or
joint venture, of which such Person or a Subsidiary of such Person is a
general partner or joint venturer or of which a majority of the partnership
or other ownership interests are at the time beneficially owned by such
Person and/or one or more of its Subsidiaries, or (c) in the case of any
other type of entity, of which such Person or a Subsidiary of such Person is
the beneficial owner of the majority in interest of the equity securities.
"TERMINATION EVENT" means (a) a "reportable event" as defined in
Section 4043 of ERISA (other than a reportable event that is not subject to
the provision for 30-day notice to the PBGC), (b) the withdrawal of the
Company or any of its ERISA Affiliates from a Multiemployer Plan during the
plan year, or from a Pension Plan during any plan year in which it was a
"substantial employer" as defined in Section 4001(a)(2) of ERISA, (c) the
filing of a notice of intent to terminate a Pension Plan or the treatment of
an amendment to a Pension Plan as a termination thereof pursuant to Section
4041 of ERISA, (d) the institution of proceedings to terminate a Pension Plan
by the PBGC or (e) any other event or condition which might reasonably be
expected to constitute grounds under ERISA for the termination of, or the
appointment of a trustee to administer, any Pension Plan or Multiemployer
Plan.
"UNRESTRICTED SUBSIDIARY" means (i) any Subsidiary of the Company
that at the time of determination shall be designated an Unrestricted
Subsidiary by the Board of Directors of the Company in the manner provided
below and (ii) any Subsidiary of an Unrestricted Subsidiary. The Board of
Directors of the Company may designate any Subsidiary of the Company
(including any newly acquired or newly formed Subsidiary) to be an
Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries
owns any Capital Stock or Indebtedness of, or holds any Lien on any property
of, the Company or any other Restricted Subsidiary of the Company; PROVIDED,
HOWEVER, that either (A) the Subsidiary to be so designated has total assets
of $1,000 or less or (b) if such Subsidiary has assets greater than $1,000,
such designation would be permitted under Section 5.4. The Board of
Directors of the Company may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary; PROVIDED, HOWEVER, that immediately after giving
effect to such designation (x) if such Unrestricted Subsidiary at such time
has Indebtedness, the Company could Incur $1.00 of additional Indebtedness
under Section 5.3(a) and (y) no Default shall have occurred and be
continuing. Any such designation by the Board of Directors shall be
evidenced by the Company to the Administrative Agent by promptly filing with
the Administrative Agent a copy of the board resolution giving effect to such
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designation and an officers' certificate certifying that such designation
complied with the foregoing provisions.
"WHOLLY OWNED SUBSIDIARY" means a Restricted Subsidiary all the
Capital Stock of which (other than directors' qualifying shares and shares
held by other Persons to the extent such shares are required by applicable
Law to be held by a Person other than the Company or a Restricted Subsidiary)
is owned by the Company or one or more Wholly Owned Subsidiaries.
1.2 USE OF DEFINED TERMS. Any defined term used in the plural
shall refer to all members of the relevant class, and any defined term used
in the singular shall refer to any one or more of the members of the relevant
class.
1.3 ACCOUNTING TERMS. All accounting terms not specifically
defined in this Agreement shall be construed in conformity with, and all
financial data required to be submitted by this Agreement shall be prepared
in conformity with, GAAP applied on a consistent basis, EXCEPT as otherwise
specifically prescribed herein. In the event that GAAP change during the
term of this Agreement such that any of the covenants contained in Article V
would then be calculated in a different manner or with different components,
(a) the Company and the Lenders agree to amend this Agreement in such
respects as are necessary to conform that covenant as a criterion for
evaluating the Company's financial condition to substantially the same
criterion as was effective prior to such change in GAAP and (b) the Company
shall be deemed to be in compliance with the covenant contained in such
Section during the 60-day period following any such change in GAAP and to
the extent that the Company would have been in compliance therewith under
GAAP as in effect immediately prior to such change.
1.4 EXHIBITS AND SCHEDULES. All Exhibits and Schedules to this
Agreement, either as originally existing or as the same may from time to time
be supplemented, modified or amended, are incorporated herein by this
reference. A matter disclosed on any Schedule shall be deemed disclosed on
all Schedules.
1.5 MISCELLANEOUS TERMS. The term "or" is disjunctive; the term
"and" is conjunctive. The term "shall" is mandatory; the term "may" is
permissive. Masculine terms also apply to females; feminine terms also apply
to males. The term "including" is by way of example and not limitation.
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ARTICLE II
THE LOAN
2.1 THE LOAN. (a) Subject to the terms and conditions set forth
in this Agreement, on the Closing Date the Lenders shall make a term Loan to
the Company in the principal amount of $15,000,000. Each Lender shall make
its Pro Rata Share of the Loan in immediately available funds available to
the Administrative Agent at the Administrative Agent's account number
9301035763 at The Chase Manhattan Bank, N.A. (ABA No. 021-000-021) ref:
Geologistics Corporation. No portion of the Loan which is prepaid or repaid
may be reborrowed.
(b) From time to time, the Company may designate portions of the
Loan as Base Rate Tranches or Eurodollar Tranches pursuant to a Pricing
Designation which shall specify the date upon which the requested Tranche
will commence, amount of such Tranche and whether the Tranche shall be a Base
Rate Tranche or a Eurodollar Tranche, and if a Eurodollar Tranche, the last
day of the Interest Period with respect thereto (which shall be a date one,
two, three or six months after the date of such Loan). Each Pricing
Designation must be sent by telecopier or telex to the Administrative Agent,
signed by a Responsible Official of the Company.
(c) Promptly following receipt of a Pricing Designation, the
Administrative Agent shall notify each Lender by telephone, telecopier or
telex thereof.
(d) Unless the Majority Lenders otherwise consent, each Tranche
shall be in an integral multiple of $100,000, which, in the case of a
Eurodollar Tranche is in an amount not less than $500,000, and no more than
five Eurodollar Tranches having different Interest Periods may be outstanding
at any time.
(e) Subject to Sections 3.3(c) and (g) hereof, a Pricing
Designation shall be irrevocable upon receipt of such Pricing Designation by
the Administrative Agent.
(f) Each Pricing Designation shall be submitted to the
Administrative Agent, at the Administrative Agent's Office, not later than
1:00 p.m, New York time, (a) with respect to a request for a Base Rate
Tranche, on the Business Day of the requested Loan, and (b) with respect to a
request for a Eurodollar Tranche, on the Business Day that is three Business
Days prior to the first day of the applicable Interest Period.
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(g) If , as of the date of any maturing Tranche, no Pricing
Designation has been submitted within the requisite notice period set forth
in this Section, then the Company shall be deemed to have requested a Base
Rate Tranche in the amount of the maturing Tranche.
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ARTICLE III
PAYMENTS AND FEES
3.1 PRINCIPAL AND INTEREST.
(a) Interest shall be payable on the outstanding daily unpaid
principal amount of the Loan from the date thereof until payment in full is
made and shall accrue and be payable at the rates set forth herein before and
after default, before and after maturity, before and after judgment, and
before and after the commencement of any proceeding under any Debtor Relief
Law.
(b) Interest accrued on each Eurodollar Tranche as of the
last day of the Interest Period with respect thereto shall be due and payable
on that day and, if such Interest Period is longer than three months, on the
last day of each three month period, the first of which commences on the
first day of such Interest Period, during such Interest Period. Interest
accrued on each Base Rate Tranche as of each Quarterly Payment Date shall be
due and payable on that day. Except as otherwise provided in Sections 3.3
and 3.4, (i) the unpaid principal amount of each Base Rate Tranche shall bear
interest at a fluctuating rate per annum equal to the Base Rate PLUS 1.75%
and (ii) the unpaid principal amount of each Eurodollar Tranche shall bear
interest at a rate per annum equal to the relevant Eurodollar Rate PLUS
3.25%. Each change in the interest rate applicable to a Base Rate Tranche
hereunder shall take effect simultaneously with the corresponding change in
the Base Rate. Each change in the Base Rate shall be effective as of 12:01
a.m. on the Business Day on which the change in the Base Rate is announced,
unless otherwise specified in such announcement, in which case the change
shall be effective as so specified.
(c) If not sooner paid, the principal Indebtedness evidenced by
the Notes shall be payable by the Company as follows:
(i) In the event that the holders of any then outstanding
obligations under the Bank Credit Agreement have exercised their rights to
be repaid upon the occurrence of any Change of Control Event, then all of
the Obligations under this Agreement and the Loan Documents shall be repaid
concurrently with the repayment of the obligations under the Bank Credit
Agreement;
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(ii) the principal amount of the Notes shall be repaid in an
amount equal to the lesser of (a) the principal amount of the Notes then
outstanding or (b) 100% of the Net Cash Proceeds of any offering of equity
securities of the Company concurrently with the receipt of such Net Cash
Proceeds, PROVIDED that the proceeds (A) from private sales of such equity
securities to any Person which is a shareholder of the Company which do not
exceed $5,000,000 and (B) from routine exercises of employee stock options,
employee warrants and employee plans shall not be required to be applied by
the Company to repay the Notes for so long as no Default or Event of
Default exists; and
(iii) the principal Indebtedness evidenced by the Notes shall
in any event be payable on the Maturity Date.
(d) VOLUNTARY PREPAYMENT. The Company each may, at any time and
from time to time, voluntarily pay or prepay the Notes in whole or in part,
EXCEPT that with respect to any voluntary prepayment of the Notes under this
Section:
(i) the Administrative Agent shall have received written notice
of any prepayment before 10:00 a.m., New York time, on the Business Day on
which such payment is to be made, which notice shall identify the date and
amount of the prepayment;
(ii) The Company shall pay any Breakage Fees due pursuant to
Section 3.3(g) with respect to any Eurodollar Tranche in connection with
such prepayment; and
(iii) any partial prepayment shall be in an integral multiple of
$1,000,000.
3.2 UPFRONT FEES. The Company shall pay to the Administrative
Agent the fees described in the Administrative Agent's Letter on the dates
set forth therein, which fees are for the sole account of the Administrative
Agent.
3.3 INCREASED COSTS.
(a) If any Lender determines that either (i) the introduction
of or any change in any law or regulation or in the interpretation or
administration of any Law
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or regulation by any Governmental Agency charged with the interpretation or
administration thereof from the Closing Date or (ii) compliance with any
guideline or request from any such Governmental Agency (whether or not having
the force of law) has or would have the effect of reducing the rate of return
on the capital of the Lender or any corporation controlling the Lender as a
consequence of or with reference to the Lender's making or maintaining its
Pro Rata Share, or other transaction hereunder below the rate which the
Lender or such other corporation could have achieved but for such
introduction, change or compliance (taking into account the policies of the
Lender or corporation with regard to capital), then the Company shall from
time to time, upon demand by the Lender, pay to the Lender additional amounts
sufficient to compensate the Lender or other corporation for such reduction.
A certificate as to such amounts in reasonable detail, submitted to the
Company by a Lender (with a copy to the Administrative Agent), shall be
conclusive and binding for all purposes, absent manifest error. Each Lender
agrees promptly to notify the Company of any circumstances that would cause
the Company to pay additional amounts pursuant to this Section, PROVIDED that
the failure to give notice shall not affect the Company's obligation to pay
such additional amounts hereunder.
(b) In the event that any Lender shall have determined (which
determination shall, absent manifest error, be final and conclusive and
binding upon all parties hereto): (i) on any date for determining the
Eurodollar Rate for any Interest Period, (A) that by reason of any changes
arising after the date of this Agreement affecting the London interbank
Eurodollar market, adequate and fair means do not exist for ascertaining the
applicable interest rate on the basis provided for in the definition of the
Eurodollar Rate; or (B) that the relevant Eurodollar Rate shall not represent
the effective pricing to such Lender for funding or maintaining its portion
of a Eurodollar Tranche, or (ii) such Lender shall at any time incur
increased costs or reductions in the amounts received or receivable hereunder
with respect to any Eurodollar Tranche in any such case because of (A) any
change since the date of this Agreement in any applicable law or governmental
rule, regulation, guideline or order or any interpretation thereof and
including the introduction of any new law or governmental rule, regulation,
guideline or order (such as, for example, a change in official reserve
requirements, but, in all events, excluding reserves required under
Regulation D of the Federal Reserve Board to the extent included in the
computation of the Eurodollar Rate), whether or not having the force of law
and whether or not failure to comply therewith would be unlawful, or (B)
other circumstances materially and adversely affecting the London interbank
eurodollar market or the position of such Lender in such market, or (iii) at
any time, that the making
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or continuance by it of any Eurodollar Tranche has become unlawful by
compliance by such Lender in good faith with any law or governmental rule,
regulation, guideline or order (whether or not having the force of law and
whether or not failure to comply therewith would be unlawful) or has become
impracticable as a result of a contingency occurring after the date of this
Agreement that materially and adversely affects the London interbank
eurodollar market, then, and in any such event, such Lender shall, promptly
after making such determination, give notice (by telephone promptly confirmed
in writing) to the Company and the Administrative Agent of such determination
(which notice the Administrative Agent shall promptly transmit to each of the
other Lenders). Thereafter, (x) in the case of clause (i) above, the
Company's right to request Eurodollar Tranches shall be suspended, and any
Pricing Designation given by the Company with respect to any borrowing of
Eurodollar Tranches that has not yet been made shall be deemed canceled and
rescinded, (y) in the case of clause (ii) above, the Company shall pay to
such Lender, upon such Lender's delivery of written demand therefor to the
Company with a copy to the Administrative Agent, such additional amounts (in
the form of an increased rate of interest, or a different method of
calculating interest, or otherwise, as such Lender in its sole discretion
shall determine) as shall be required to compensate such Lender for such
increased costs or reduction in amounts received or receivable hereunder and
(z) in the case of clause (iii) above, the Company shall take one of the
actions specified in clause (c) below as promptly as possible and, in any
event, within the time period required by law. Each request for compensation
by a Lender under this clause (b) shall be submitted within 90 days following
the date upon which such Lender first becomes aware of the events giving rise
to the request for compensation.
(c) In the case of any Eurodollar Tranche or requested
Eurodollar Tranche affected by the circumstances described in clause (b)(iii)
above the Company shall, either if any such Eurodollar Tranche has not yet
been made but is then the subject of a Pricing Designation, or if any such
Eurodollar Tranche is then outstanding, require the affected Lender to
convert each such Eurodollar Tranche into a Base Rate Tranche at the end of
the applicable Interest Period or such earlier time as may be required by
law, in each case by giving the Administrative Agent notice (by telephone
promptly confirmed in writing) thereof on the Business Day that the Company
was notified by the Lender pursuant to clause (b) above; PROVIDED, however,
that all Lenders whose Eurodollar Tranches are affected by the circumstances
described above shall be treated in the same manner under this clause (c).
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(d) Promptly after giving any notice to the Company as a
result of a circumstance described in Section 3.3(b)(ii) or 3.3(b)(iii), any
Lender giving such notice will use good faith efforts to designate one of its
offices located at an address other than that set forth on the signature
pages hereto as the office at which its portion of the Loan is maintained if
such designation will (i) avoid the need for, or reduce the amount of, any
payment to which such Lender would otherwise be entitled pursuant to Section
3.3 or causing the Company to take any of the actions described in Section
3.3(c) and (ii) not, in the sole discretion of such Lender, be otherwise
disadvantageous to such Lender. If a Lender ("Affected Lender") shall have
requested compensation from Company under Sections 3.3(a) or 3.3(b)(ii)
hereof to recover additional costs incurred by such Lender which are not
being incurred generally by the other Lenders, then the Company may make
written demand on such Affected Lender (with a copy to the Administrative
Agent) for the Affected Lender to assign, and such Affected Lender shall
assign pursuant to one or more duly executed Assignment and Acceptance
Agreements sixty Business Days after the date of such demand, to one or more
financial institutions that comply with the provisions of Section 9.8(b) (and
that are reasonably acceptable to the Administrative Agent) which the Company
shall have engaged for such purpose, all of such Affected Lender's rights and
obligations under this Agreement and the other Loan Documents in accordance
with Section 9.8.
(e) In the event that the Administrative Agent determines at
any time following its giving of notice based on the conditions described in
clause (b)(i) above that none of such conditions exist, the Administrative
Agent shall promptly give notice thereof to the Company and the Lenders,
whereupon the Company's' right to request Eurodollar Tranches from the
Lenders and the Lenders' obligation to make Eurodollar Tranches shall be
restored.
(f) In the event that a Lender determines at any time
following its giving of a notice based on the conditions described in clause
(b)(iii) above that none of such conditions exist, such Lender shall promptly
give notice thereof to the Company and the Administrative Agent, whereupon
the Company's' right to request Eurodollar Tranches from such Lender and such
Lender's obligation to make Eurodollar Tranches shall be restored.
(g) The Company each shall compensate each Lender, upon such
Lender's delivery of a written demand therefor to the Company, with a copy to
the Administrative Agent (which demand shall, absent manifest error, be final
and conclusive
- 33 -
and binding upon all of the parties hereto), for all reasonable losses,
expenses and liabilities incurred by such Lender in connection with the
liquidation or reemployment of deposits or funds required by it to make or
carry its Eurodollar Tranches, that such Lender sustains (any and all of the
foregoing, a "Breakage Fee"): (i) if for any reason (other than a default by
such Lender or a circumstance described in Section 3.3(b)(iii) with respect
to such Lender) a borrowing of Eurodollar Tranches does not occur on a date
specified therefor in a Pricing Designation (whether or not rescinded,
canceled or withdrawn or deemed rescinded, canceled or withdrawn), (ii) if
any repayment (including, without limitation, payment after acceleration) of
any of its Eurodollar Tranches occurs on a date which is not the last day of
the Interest Period applicable thereto, (iii) any prepayment of any of its
Eurodollar Tranches is not made on any date specified in a notice of
prepayment given by the Company or is made on a date other than on the last
day of the Interest Period applicable thereto, or (iv) as a consequence of
any default by the Company in repaying their Eurodollar Tranches or any other
amounts owing hereunder with respect to its Eurodollar Tranches when required
by the terms of this Agreement.
(h) The Lenders shall be entitled to fund all or any portion
of the Loan in any manner each Lender may determine in its sole discretion,
including, without limitation, in the Grand Cayman interbank market, the
London interbank market and within the United States, but all calculations
and transactions hereunder shall be made on the assumption that such Lender
has funded its relevant Eurodollar Tranche through the purchase of a
Eurodollar deposit bearing interest at the Eurodollar Rate in an amount equal
to the amount of such Eurodollar Tranche with a maturity equivalent to the
Interest Period applicable to such Eurodollar Tranche, and through the
transfer of such Eurodollar deposit from an offshore office of such Lender to
a domestic office of such Lender in the United States of America, PROVIDED
that each Lender may fund its Eurodollar Tranches in any manner that it in
its sole discretion chooses and the foregoing assumption shall only be made
in order to calculate amounts payable under this Section.
3.4 COMPUTATION OF INTEREST AND FEES. Computation of interest
under this Agreement and the other Loan Documents shall be made on the basis
of a year of 360 days and the actual number of days elapsed. If any payment
to be made by the Company or any other Party under any Loan Document shall
come due on a day other than a Business Day, payment shall instead be
considered due on the next succeeding Business Day and the extension of time
shall be reflected in computing interest.
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3.5 MANNER AND TREATMENT OF PAYMENTS.
(a) Each payment hereunder with respect to the Notes or under
any other Loan Document shall be made to the Administrative Agent, at the
Administrative Agent's account number 9301035763 at The Chase Manhattan
Bank, N.A., (ABA #021-000-021 ref: Geologistics Corporation), for the
account of each of the Lenders or the Administrative Agent, as the case may
be, in immediately available funds not later than 1:00 p.m., New York time,
on the day of payment (which must be a Business Day); PROVIDED, however,
that the Company shall provide a minimum of one hour's prior notice of any
payments to be made after 11:30 a.m., New York time. All payments received
after the deadlines described above on any particular Business Day and of
which the Administrative Agent did not receive at least one hour's prior
notice, shall be deemed received on the next succeeding Business Day,
unless the Company provide to the Administrative Agent reasonably
satisfactory evidence that it had initiated on a prior Business Day a wire
transfer of funds to be immediately available on the particular Business
Day, in which case such payment (whenever received) shall be deemed
received on the particular Business Day. The amount of all payments
received by the Administrative Agent for the account of each Lender shall
be paid by the Administrative Agent to the applicable Lender in immediately
available funds on the same day received by the Administrative Agent
(provided that payments received by the Administrative Agent after 1:00
p.m, New York time on any Business Day, and all payments received after
11:30 a.m., New York time, on any particular Business Day and of which the
Administrative Agent did not receive at least one hour's prior notice,
shall be deemed to be received on the next Business Day). All payments
shall be made in lawful money of the United States of America.
(b) Each Lender shall use its best efforts to keep a record of
payments received by it with respect to its Note and, subject to Section
8.6(g), such record shall be presumptive evidence of the amounts owing.
Notwithstanding the foregoing sentence, no Lender shall be liable to any
party for any failure to keep such a record.
(c) Each payment of any amount payable by the Company or any
other Party under this Agreement or any other Loan Document shall be made
free
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and clear of, and without reduction by reason of, any taxes, assessments
or other charges imposed by any Governmental Agency, central bank or
comparable authority (other than taxes on income, gross receipts or net
worth generally applicable to banks or financial institutions). To the
extent that the Company is obligated by applicable Law to make any
deduction or withholding on account of taxes, assessments or other
charges imposed by any Governmental Agency from any amount payable to any
Lender under this Agreement, the Company shall make such deduction or
withholding and pay the same to the relevant Governmental Agency and pay
such additional amount to that Lender as is necessary to result in that
Lender's receiving a net after-tax (or after assessment or after-charge)
amount equal to the amount to which that Lender would have been entitled
under this Agreement absent such deduction or withholding. If and when
receipt of such payment results in an excess payment or credit to that
Lender on account of such taxes, assessments or other charges, that
Lender shall refund such excess to the Company.
(d) Each Lender that is organized outside the United States of
America shall promptly, and in any event prior to the due date of any
payment by the Company hereunder, deliver to the Company an Internal
Revenue Service Form 4224 and any other certificate or statement or
exemption required by applicable Laws, properly completed and duly executed
by such Lender, to establish that such payment is not subject to
withholding under the Code because such payment is effectively connected
with the conduct by such Lender of a trade or business in the United States
of America. Unless the Company and the Administrative Agent have received
such Form or other documents satisfactory to them indicating that payments
hereunder or under the Notes are not subject to United States withholding
tax, the Company or the Administrative Agent shall withhold taxes from such
payments at the applicable statutory rate in the case of payments to or for
any Lender organized under the Laws of a jurisdiction outside the United
States of America and Section 3.5(c) shall not apply thereto.
3.6 FAILURE TO CHARGE NOT SUBSEQUENT WAIVER. Any decision by the
Administrative Agent or any Lender not to require payment of any interest,
fee, costs or other amount payable under any Loan Document, or to calculate
any amount payable by a particular method, on any occasion, shall in no way
limit or be deemed a waiver of the Administrative Agent's or such Lender's
right to require full payment of any interest, fee,
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cost or other amount payable under any Loan Document, or to calculate an
amount payable by another method, on any other or subsequent occasion.
3.7 ADMINISTRATIVE AGENT'S RIGHT TO ASSUME PAYMENTS WILL BE MADE
BY THE COMPANY. Unless the Administrative Agent shall have been notified by
the Company prior to the date on which any payment to be made hereunder that
such the Company does not intend to remit such payment, the Administrative
Agent may, in its discretion, assume that the Company has remitted such
payment when so due and the Administrative Agent may, in its discretion and
in reliance upon such assumption, make available to each Lender on such
payment date an amount equal to such Lender's share of such assumed payment.
If the Company has not in fact remitted such payment to the Administrative
Agent, each Lender shall forthwith on demand repay to the Administrative
Agent the amount of such assumed payment made available to such Lender,
together with interest thereon with respect to each day from and including
the date such amount was made available by the Administrative Agent to such
Lender to the date such amount is repaid to the Administrative Agent at a
rate per annum equal to the Federal Funds Rate for such period.
3.8 FEE AND COST DETERMINATION DETAIL. The Administrative Agent
and each Lender shall provide reasonable detail to the Company regarding the
manner in which the amount of any payment to the Administrative Agent or that
Lender under this Agreement has been determined.
3.9 SURVIVABILITY. All of the Company's obligations under Section
3.3 shall survive for three months following the date on which the Loan is
fully paid; PROVIDED, however, that such obligations shall not, from and
after the date on which the Loan is fully paid, be deemed Obligations for any
purpose under the Loan Documents.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Lenders that, in each case
after giving effect to the transactions contemplated hereby:
4.1 SOLVENCY. On the Closing Date and after giving effect to the
transactions contemplated hereby, the Company and each Restricted Subsidiary
shall be Solvent.
4.2 EXISTENCE AND QUALIFICATION, POWER, COMPLIANCE WITH LAWS. The
Company is a corporation duly formed, validly existing and in good standing
under the Laws of Delaware. The Company is duly qualified to transact
business, and is in good standing in Delaware and each other jurisdiction in
which the conduct of its business or the ownership or leasing of its
Properties makes such qualification or registration necessary, EXCEPT where
the failure so to qualify or register and to be in good standing would not
constitute a Material Adverse Effect. The Company has all requisite
corporate power and authority to conduct its business, to own and lease its
Properties and to execute and deliver each Loan Document to which it is a
Party and to perform the Obligations to be performed by it thereunder. The
Company and its Guarantor Subsidiaries have each duly executed and delivered
each Loan Document to which each is a party. All outstanding shares of
capital stock of the Company are duly authorized, validly issued, fully paid,
non-assessable and issued in compliance with all applicable state, provincial
and federal securities and other Laws. As of the Closing Date, there are
5,000,000 shares of common stock of the Company authorized and (as of July
10, 1998) 2,128,893 shares of common stock of the Company issued and
outstanding and not less than eighty percent (80%) of the issued and
outstanding shares of the capital stock of the Company are then owned
collectively by the Sponsors and the management of the Company and its
Subsidiaries. No Person holds any option, warrant or other right to acquire
any shares of capital stock of the Company except as disclosed in the Bank
Credit Agreement Schedules. The Company is in compliance with all Laws and
other legal requirements applicable to its business, has obtained all
authorizations, consents, approvals, orders, licenses and permits from, and
has accomplished all Filings, registrations and qualifications with, or
obtained exemptions from any of the foregoing from, any Governmental Agency
that are necessary for the transaction of its business, EXCEPT where
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the failure so to comply, file, register, qualify or obtain exemptions does
not constitute a Material Adverse Effect.
4.3 AUTHORITY; COMPLIANCE WITH OTHER AGREEMENTS AND INSTRUMENTS
AND GOVERNMENT REGULATIONS. The execution, delivery and performance by each
of the Company and its Restricted Subsidiaries of the Loan Documents to which
it is a Party have been duly authorized by all necessary corporate action,
and do not:
(a) Require any consent or approval not heretofore obtained of
any partner, director, stockholder, security holder or creditor of such
Party;
(b) Violate or conflict with any provision of such Party's
charter, consenting documents, articles of incorporation or bylaws, as
applicable;
(c) Result in or require the creation or imposition of any Lien
or Right of Others upon or with respect to any Property now owned or leased
or hereafter acquired by such Party;
(d) Violate any Requirement of Law applicable to such Party;
(e) Constitute a "transfer of an interest" or an "obligation
incurred" that is avoidable by a trustee under Section 548 of the
Bankruptcy Code of 1978, as amended, or constitute a "fraudulent
conveyance," "fraudulent obligation" or "fraudulent transfer" within the
meanings of the Uniform Fraudulent Conveyance Act or Uniform Fraudulent
Transfer Act or any similar law, as enacted in any jurisdiction; or
(f) Result in a breach of or default under or would, with the
giving of notice or the lapse of time or both, constitute a breach of or
default under, or cause or permit the acceleration of any obligation owed
under, any indenture or loan or credit agreement or any other Contractual
Obligation to which such Party is a party or by which such Party or any of
its Property is bound or affected; and neither the Company nor any of its
Subsidiaries is in violation of, or default under, any Requirement of Law
or Contractual Obligation, or any indenture, loan or credit agreement, in
any respect that constitutes a Material Adverse Effect.
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4.4 NO GOVERNMENTAL APPROVALS REQUIRED. No authorization,
consent, approval, order, license or permit from, or filing, registration or
qualification with, any Governmental Agency is required to authorize or
permit under applicable Laws the execution, delivery and performance by the
Company and each of its Guarantor Subsidiaries of the Loan Documents to which
it is a Party.
4.5 SUBSIDIARIES.
(a) Schedule 4.5 hereto correctly sets forth as of the Closing
Date the names, the form of legal entity, jurisdictions of organization and
the number of shares of capital stock issued and outstanding of each
Guarantor Subsidiary of the Company formed since December 1, 1997. As of
the Closing Date, the Company does not own any capital stock or equity
interest in any Person other than its Subsidiaries. Unless otherwise
indicated on Schedule 4.5 or described in the Bank Credit Agreement
Schedules, as of the Closing Date, all of the outstanding shares of capital
stock or all of the units of equity interest, as the case may be, of each
Guarantor Subsidiary are owned of record and beneficially by the Person
designated on Schedule 4.5 (or so described), there are no outstanding
options, warrants or other rights to purchase capital stock of any
Guarantor Subsidiary, and all such shares or equity interests so owned are
duly authorized, validly issued, fully paid, nonassessable, and were issued
in compliance with all applicable Laws, and are free and clear of all Liens
and Rights of Others, EXCEPT for Permitted Liens and Permitted Rights of
Others.
(b) Each Guarantor Subsidiary is a legal entity, duly organized,
validly existing, and in good standing under the Laws of its jurisdiction
of organization, is duly qualified to do business as a foreign organization
and is in good standing as such in each jurisdiction in which the conduct
of its business or the ownership or leasing of its properties makes such
qualification necessary (EXCEPT where the failure to be so duly qualified
and in good standing does not constitute a Material Adverse Effect), and
has all requisite power and authority to conduct its business and to own
and lease its Properties.
(c) Each Guarantor Subsidiary is in compliance with all Laws and
other requirements applicable to its business and has obtained all
authorizations, consents, approvals, orders, licenses, and permits from,
and each such Subsidiary has accomplished all filings, registrations, and
qualifications with,
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or obtained exemptions from any of the foregoing from,
any Governmental Agency that are necessary for the transaction of its
business EXCEPT where the failure to be in such compliance, obtain such
authorizations, consents, approvals, orders, licenses, and permits,
accomplish such filings, registrations, and qualifications, or obtain such
exemptions, does not constitute a Material Adverse Effect.
4.6 FINANCIAL STATEMENTS. The Company has furnished to the Lenders
(a) the audited financial statements of the Company and its Subsidiaries as at
December 31, 1997, (b) and the unaudited consolidated and consolidating
financial statements of the Company and its Subsidiaries as of March 31, 1998.
The financial statements described above fairly present the financial condition
and the results of operations of the Persons described as at such dates and for
such periods in accordance with GAAP consistently applied, subject to year-end
adjustments and the absence of footnotes.
4.7 NO OTHER LIABILITIES; NO MATERIAL ADVERSE EFFECT. Except as
disclosed on Schedule 4.7, as of the Closing Date, the Company and its
Restricted Subsidiaries do not and will not have any material liability or
material contingent liability not reflected or disclosed in the financial
statements described in Section 4.6. Except as otherwise disclosed in writing
to the Lenders prior to the Closing Date, there has been no event or
circumstance that has occurred that constitutes a Material Adverse Effect since
December 31, 1997 or at the Closing Date.
4.8 TITLE TO PROPERTY. As of March 31, 1998, the Company and its
Subsidiaries have, good and valid title to all the Property reflected in the
financial statements described in Section 4.6 other than Property subsequently
sold or disposed of in the ordinary course of business, free and clear of all
Liens and Rights of Others, other than Permitted Liens and Permitted Rights of
Others and as otherwise permitted by Section 5.10.
4.9 INTANGIBLE ASSETS. Except as set forth in the Bank Credit
Agreement Schedules and on Schedule 4.9, the Company and its Restricted
Subsidiaries own, or possess the right to use to the extent necessary in their
respective businesses, all trademarks, trade names, copyrights, patents, patent
rights, computer software, licenses and other Intangible Assets that are used in
the conduct of their respective businesses as now operated and which are
material to the condition (financial or otherwise), business or operations of
the Company and its Restricted Subsidiaries, taken as a whole, and no such
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Intangible Asset, to the Best Knowledge of the Company, conflicts with the valid
trademark, trade name, copyright, patent, patent right or Intangible Asset of
any other Person to the extent that such conflict constitutes a Material Adverse
Effect.
4.10 GOVERNMENTAL REGULATION. Neither the Company nor any of its
Guarantor Subsidiaries is subject to regulation under any Law limiting or
regulating its ability to incur Indebtedness for money borrowed.
4.11 LITIGATION. As of the Closing Date, there are no actions, suits,
proceedings or investigations pending as to which the Company or its Guarantor
Subsidiaries have been served or have received notice or, to the Best Knowledge
of the Company, have been threatened against or affecting the Company or its
Guarantor Subsidiaries or any Property of any of them before any Governmental
Agency that individually could be reasonably expected to (i) result in an
adverse decision which could, in a manner not involving the payment of money,
materially and adversely affect the condition (financial or otherwise) or
business operations of the Company and its Guarantor Subsidiaries, taken as a
whole, or the properties and assets of the Company and its Subsidiaries, taken
as a whole, or (ii) in any manner draw into question the validity or
enforceability of any Loan Document. As of the Closing Date, except as set
forth in the Bank Credit Agreement Schedules and on Schedule 4.11, there are no
actions, suits, proceedings or investigations pending as the Company and its
Guarantor Subsidiaries, or, to the Best Knowledge of the Company and its
Guarantor Subsidiaries, threatened against or affecting the Company or its
Guarantor Subsidiaries which could reasonably be expected to result in a
judgment in excess of $500,000 (other than a money judgment covered by insurance
as to which the insurance the Company has not disclaimed or reserved the right
to disclaim coverage) being entered or filed against the Company or any of its
Guarantor Subsidiaries.
4.12 BINDING OBLIGATIONS. Each of the Loan Documents to which the
Company or any of its Guarantor Subsidiaries is a Party will, when executed and
delivered by such Party, constitute the legal, valid and binding obligation of
such Party, enforceable against such Party in accordance with its terms, EXCEPT
as enforcement may be limited by Debtor Relief Laws or equitable principles
relating to the granting of specific performance and other equitable remedies as
a matter of judicial discretion.
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4.13 NO DEFAULT. As of the Closing Date, and giving effect to each of
the transactions contemplated to occur thereon, no event has occurred and is
continuing that is a Default or an Event of Default.
4.14 ERISA.
(a) EXCEPT as disclosed in the Bank Credit Agreement Schedules,
neither the Company nor any ERISA Affiliate maintains, contributes to or is
required to or will maintain, contribute to or will be required to
contribute to, any "employee pension benefit plan" that is subject to Title
IV of ERISA.
(b) With respect to each Pension Plan and except as may be
otherwise therein described:
(i) such Pension Plan complies in all material respects
with ERISA and any other applicable Laws;
(ii) such Pension Plan has not incurred any material
"accumulated funding deficiency," as that term is defined in Section
302 of ERISA;
(iii) no "reportable event" (as defined in Section 4043 of
ERISA) has occurred that would subject the Company or any of its ERISA
Affiliates to any liability with respect to such Pension Plan that
would constitute a Material Adverse Effect;
(iv) neither the Company nor any ERISA Affiliate thereof has
engaged in any nonexempt "prohibited transaction" (as defined in
Section 4975 of the Code) that would subject the Company or any of its
ERISA Affiliates to any penalty that would constitute a Material
Adverse Effect;
(v) no Termination Event has occurred or may reasonably be
expected to occur that would constitute a Material Adverse Effect;
(vi) no material liability to the PBGC (other than required
premium payments), the Internal Revenue Service, any Pension Plan,
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Multiemployer Plan or any trust related thereto has been, or is
expected by the Company or any of its ERISA Affiliates to be, incurred
by the Company or any of its ERISA Affiliates that would constitute a
Material Adverse Effect;
(vii) neither the Company nor any of its ERISA Affiliates has
any contingent liability with respect to any post-retirement benefit
under any "Welfare plan" (as defined in Section 3(1) of ERISA) that
would constitute a Material Adverse Effect, other than liability for
continuation coverage under Part 6 of Title I of ERISA; and
(viii) no lien under Section 412(n) of the Code or 302(f) of
ERISA or requirement to provide security under Section 401(a)(29) of
the Code or Section 307 of ERISA has been or is reasonably expected by
the Company or any of its ERISA Affiliates to be imposed on the assets
of the Company or any member of its ERISA Affiliates that would
constitute a Material Adverse Effect.
(c) As of the Closing Date, all contributions required to be
made by the Company or any of its ERISA Affiliates to a Multiemployer Plan
have been made.
4.15 REGULATIONS T, U AND X. No part of the proceeds of the Loan will
be used to purchase or carry, or to extend credit to others for the purpose of
purchasing or carrying, any "margin stock" (as such term is defined in
Regulations T, U and X) in violation of Regulations T, U or X. Neither the
Company nor any of its Subsidiaries is engaged principally, or as one of its
important activities, in the business of extending credit for the purpose of
purchasing or carrying any such "margin stock."
4.16 DISCLOSURE. No written statement made by a Senior Officer of the
Company or any of its Subsidiaries to any Creditor in connection with this
Agreement, or in connection with the Loan, as such statement may be amended,
modified or supplemented prior to the Closing Date, contains any untrue
statement of a material fact or omits a material fact necessary in order to make
the statement made not misleading in light of all the circumstances existing at
the date the statement was made. To the Best Knowledge of the Company there is
no fact (other than matters of a general economic nature or matter generally
applicable to businesses of the types engaged in by the
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Company and its Subsidiaries) that would constitute a Material Adverse effect
that has not been disclosed in writing to the Administrative Agent and the
Lenders.
4.17 TAX LIABILITY. Except as disclosed in the Bank Credit Agreement
Schedules, the Company and its Guarantor Subsidiaries have filed all material
tax returns that are required to be filed, and have paid, or made provision for
the payment of, all taxes with respect to the periods, Property or transactions
covered by said returns, or pursuant to any assessment received by the Company
or any of its Guarantor Subsidiaries, EXCEPT:
(a) taxes for which the Company or its relevant Guarantor
Subsidiaries have been fully indemnified;
(b) such taxes, if any, as are being contested in good faith by
appropriate proceedings and as to which adequate accounting reserves have
been established and maintained; and
(c) such minor taxes involving not more than $25,000 in
potential liability in any particular instance (or more than $100,000 in
the aggregate) imposed by a political subdivision of a State of the United
States of America or the United Kingdom.
To the Best Knowledge of the Company, there is no tax assessment
contemplated or proposed by any Governmental Agency against the Company or any
of its Guarantor Subsidiaries that would constitute a Material Adverse Effect
OTHER than as of each date subsequent to the Closing Date, such contemplated or
proposed tax assessments with respect to which the Company (i) has promptly
notified Administrative Agent in writing of its knowledge and (ii) the Company
or the appropriate Guarantor Subsidiary of the Company has in good faith
commenced, and thereafter diligently pursued, appropriate proceedings in
opposition to such assessments.
4.18 PROJECTIONS. As of the Closing Date, to the Best Knowledge of
the Company, the assumptions set forth in the Projections attached hereto as
Schedule 4.18 are reasonable and consistent with each other and with all facts
known to any Senior Officer of the Company, and in the reasonable judgment of
the Company, no material assumption is omitted as a basis for the Projections,
and the Projections are reasonably
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based on such assumptions. Nothing in this Section shall be construed as a
representation or covenant that the Projections in fact will be achieved.
4.19 EMPLOYEE MATTERS. Except as disclosed on the Bank Credit
Agreement Schedules and on Schedule 4.19, there is no strike or work stoppage in
existence or threatened involving the Company or its Guarantor Subsidiaries, and
no such strike or work stoppage may reasonably be expected to result in or
constitute a Material Adverse Effect.
4.20 HAZARDOUS MATERIALS. Except as specifically described in the
Bank Credit Agreement Schedules and on Schedule 4.20, neither the Company nor
any of its Guarantor Subsidiaries, nor any predecessor in title or any third
person at any time occupying or present on the real property owned or leased at
any time by the Company or any of its Guarantor Subsidiaries, has disposed of,
discharged, released or threatened the release of any material amount of
Hazardous Materials on, from or under such real property in any manner that
violates any Hazardous Materials Laws which violation could reasonably be
expected to have a Material Adverse Effect. Except as specifically described in
the Bank Credit Agreement Schedules and on Schedule 4.20, there have been no
actions, events, conditions or circumstances that might cause the Company or any
Guarantor Subsidiary to incur response costs under environmental Law, or costs
relating to personal or property injury relating to owned or leased real
property, except as would not individually or in the aggregate have a Material
Adverse Effect. Except as specifically described in the Bank Credit Agreement
Schedules and on Schedule 4.20, no real property owned or leased by the Company
or any of its Guarantor Subsidiaries or portion thereof is or has been utilized
by the Company or any of its Guarantor Subsidiaries as a site for the
manufacture, handling, treatment, storage or disposal of any Hazardous Materials
and all such real property is in compliance in all material respects with all
Hazardous Materials Laws. To the extent that any Hazardous Materials have been,
or are used, generated or stored by the Company or any of its Guarantor
Subsidiaries on any real property, or transported to or from such real property
by the Company or its Guarantor Subsidiaries, such use, generation, storage and
transportation have been, and are, in compliance in all material respects with
all Hazardous Materials Laws. For the purposes of this Section, the phrase
"real property owned or leased" includes, without limitation, any real property
which is in the charge, management or control of the Company or any of its
Guarantor Subsidiaries or otherwise for which the Company or any of its
Guarantor Subsidiaries may be liable or responsible under any Hazardous
Materials Laws.
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4.21 LABOR DISPUTES. Except as set forth in the Bank Credit Agreement
Schedules and on Schedule 4.21, there is no collective bargaining agreement or
other labor contract covering any employees of the Company or its Guarantor
Subsidiaries except for that covering employees of any Canadian Subsidiaries of
the Company.
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ARTICLE V
COVENANTS
5.1 PAYMENT OF NOTES. The Company shall promptly pay the principal
of and interest on the Notes on the dates and in the manner provided in the
Notes and in this Agreement.
5.2 SEC REPORTS. The Company shall file with the Commission and
provide to the Administrative Agent and Lenders, within 15 days after it files
them with the Commission, copies of the annual reports and the information,
documents and other reports which it is required to file with the Commission
pursuant to Section 13 or 15(d) of the Exchange Act. Notwithstanding that the
Company may not be required to remain subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, the Company shall file with the
Commission (unless the Commission will not accept such a filing) and provide the
Administrative Agent and Lenders with the annual reports and the information,
documents and other reports as are specified in Sections 13 and 15(d) of the
Exchange Act and applicable to a U.S. corporation subject to such Sections, such
information, documents and other reports to be so filed and provided at the
times specified for the filing of such information, documents and reports under
such Sections.
Delivery of such reports, information and documents to the
Administrative Agent is for informational purposes only and the Administrative
Agent's receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Company's compliance with any of its covenants hereunder
(as to which the Administrative Agent is entitled to rely exclusively on
Certificates of Responsible Officials).
5.3 LIMITATION ON INDEBTEDNESS. (a) (i) The Company shall not
Incur, directly or indirectly, any Indebtedness unless, on the date of such
Incurrence, the Consolidated Coverage Ratio exceeds 2.25 to 1.0 and (ii) none of
the Restricted Subsidiaries of the Company shall Incur, directly or indirectly,
any Indebtedness unless, on the date of such Incurrence, the Consolidated
Coverage Ratio exceed 2.50 to 1.0.
(b) Notwithstanding Section 5.3(a), the Company and the Restricted
Subsidiaries may Incur any or all of the following Indebtedness:
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(i) Indebtedness (including reimbursement obligations in respect
of letters of credit outstanding under the Bank Credit Agreement that are
Indebtedness) Incurred pursuant to any Bank Credit Agreement or any other
credit or loan agreement in an aggregate principal amount which, when taken
together (without duplication) with the principal amount of all other
Indebtedness Incurred pursuant to this clause (i) and then outstanding,
does not exceed $100,000,000;
(ii) Indebtedness of the Company or any Restricted Subsidiary
owed to and held by the Company or any Restricted Subsidiary; PROVIDED,
HOWEVER, that any subsequent issuance or transfer of any Capital Stock
which results in any such Restricted Subsidiary ceasing to be a Restricted
Subsidiary or any subsequent transfer of such Indebtedness (other than to
another Restricted Subsidiary) shall be deemed, in each case, to constitute
the Incurrence of such Indebtedness by the Company or such Restricted
Subsidiary;
(iii) the Notes, the Guaranties or any Indebtedness the proceeds
of which are used to refinance the Notes in full;
(iv) Indebtedness (including reimbursement obligations in respect
of letters of credit or guarantees outstanding under Foreign Credit
Agreements that are Indebtedness) Incurred pursuant to any Foreign Credit
Agreement; PROVIDED, that the aggregate principal amount of all such
Indebtedness outstanding at any time under all such Foreign Credit
Agreements shall not exceed $30,000,000;
(v) Indebtedness outstanding on the Senior Note Issue Date
(other than Indebtedness described in clause (i), (ii), (iii) or (iv) of
this Section 5.3(b));
(vi) Refinancing Indebtedness in respect of Indebtedness Incurred
pursuant to paragraph (a) of this Section 5.3 or pursuant to clause (iii)
or (v) of this Section 5.3(b) or this Section 5.3(b)(vi);
(vii) Indebtedness in respect of customs duties guarantees,
equipment leases, performance bonds, bankers, acceptances, letters of
credit and surety or appeal bonds entered into by the Company or any
Restricted Subsidiary in the ordinary course of business;
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(viii) Hedging Obligations consisting of Interest Rate Agreements
directly related to Indebtedness permitted to be Incurred by the Company or
any Restricted Subsidiary hereunder;
(ix) Indebtedness of the Company or any Restricted Subsidiary
consisting of obligations in respect of purchase price adjustments in
connection with the acquisition or disposition of assets by the Company or
any Restricted Subsidiary permitted hereunder;
(x) Indebtedness incurred by the Company or any Restricted
Subsidiary, constituting reimbursement obligations with respect to letters
of credit issued in the ordinary course of business, including, without
limitation, letters of credit in respect of workers, compensation claims,
self-insurance or similar matters, or other Indebtedness with respect to
reimbursement obligations regarding workers, compensation claims; provided,
however, that upon the drawing of such letters of credit or the Incurrence
of such Indebtedness, such obligations are reimbursed within 30 days
following such drawing or Incurrence; and
(xi) Indebtedness in an aggregate principal amount which,
together with all other Indebtedness of the Company and its Restricted
Subsidiaries outstanding on the date of such Incurrence (other than
Indebtedness permitted by clauses (i) through (x) above or Section 5.3(a)),
does not exceed, when aggregated with the principal amount of the Notes
then outstanding, $15,000,000.
(c) Notwithstanding the foregoing, neither the Company nor any
Restricted Subsidiary shall Incur any Indebtedness pursuant to the foregoing
Section 5.3(b) if the proceeds thereof are used, directly or indirectly, to
refinance any Subordinated Obligations unless such Indebtedness shall be
subordinated to the Notes or the Guaranties, as applicable, to at least the same
extent as such Subordinated Obligations.
(d) For purposes of determining compliance with this Section 5.3,
(i) in the event that an item of Indebtedness meets the criteria of more than
one of the types of Indebtedness described above, the Company, in its sole
discretion, will classify such item of Indebtedness and only be required to
include the amount and type of such Indebtedness in one of the above clauses and
(ii) an item of Indebtedness may be divided and classified in more than one of
the types of Indebtedness described above.
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5.4 LIMITATIONS ON RESTRICTED PAYMENTS. (a) The Company shall not,
and shall not permit any Restricted Subsidiary to, directly or indirectly, make
a Restricted Payment if at the time the Company or such Restricted Subsidiary
makes, and after giving effect to, the proposed Restricted Payment: (i) a
Default shall have occurred and be continuing (or would result therefrom); (ii)
the Company or such Restricted Subsidiary, as applicable, is not able to Incur
an additional $1.00 of Indebtedness under Section 5.3(a); or (iii) the aggregate
amount of such Restricted Payment and all other Restricted Payments since the
Senior Note Issue Date would exceed the sum of:
(A) 50% of the Consolidated Net Income accrued during the period
(treated as one accounting period ) from the beginning of the fiscal
quarter immediately following the fiscal quarter during which the Notes are
originally issued to the end of the most recently ended fiscal quarter for
which financial statements are available at the time of such Restricted
Payment (or, in case such Consolidated Net Income shall be a deficit, minus
100% of such deficit);
(B) the aggregate Net Cash Proceeds received by the Company from
capital contributions or the issuance or sale of its Capital Stock (other
than Disqualified Stock) subsequent to the Senior Note Issue Date (other
than an issuance or sale to a Subsidiary of the Company);
(C) the amount by which Indebtedness of the Company is reduced on
the Company's balance sheet upon the conversion or exchange (other than by
a Subsidiary of the Company) subsequent to the Senior Note Issue Date, of
any Indebtedness of the Company or a Restricted Subsidiary for Capital
Stock (other than Disqualified Stock) of the Company (less the amount of
any cash, or the fair market value of any other property, distributed by
the Company upon such conversion or exchange), whether pursuant to the
terms of such Indebtedness or pursuant to an agreement with a creditor to
engage in an equity for debt exchange; and
(D) an amount equal to the sum of (i) the net reduction in
Investments in Unrestricted Subsidiaries resulting from the receipt of
dividends, repayments of loans or advances or other transfers of assets or
proceeds from the disposition of Capital Stock or other distributions or
payments, in each case to the Company or any Restricted Subsidiary from, or
with respect to interests in Unrestricted Subsidiaries, and (ii) the
portion (proportionate to the Company's equity interest in
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such Subsidiary) of the fair market value of the net assets of an
Unrestricted Subsidiary at the time such Unrestricted Subsidiary is
designated a Restricted Subsidiary; PROVIDED, HOWEVER, that the foregoing
sum shall not exceed, in the case of any Unrestricted Subsidiary, the
amount of Investments previously made (and treated as a Restricted
Payment) by the Company or any Restricted Subsidiary in such Unrestricted
Subsidiary subsequent to the Senior Note Issue Date.
(b) The provisions of Section 5.4(a) shall not prohibit:
(i) any purchase or redemption of Capital Stock or Subordinated
Obligations of the Company made by exchange for, or out of the proceeds of
the substantially concurrent sale of, Capital Stock of the Company (other
than (A) Disqualified Stock or (B) Capital Stock issued or sold to a
Subsidiary of the Company) or out of the proceeds of a substantially
concurrent capital contribution to the Company; PROVIDED, HOWEVER, that (x)
such purchase, capital contribution or redemption shall be excluded in the
calculation of the amount of Restricted Payments and (y) the Net Cash
Proceeds from such sale of Capital Stock or capital contribution shall be
excluded from Section 5.4(a)(iii)(B);
(ii) any purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value of Subordinated Obligations made by
exchange for, or out of the net proceeds of the substantially concurrent
sale of, Indebtedness of the Company which is permitted to be Incurred
pursuant to Section 5.3; PROVIDED, HOWEVER, that such purchase, repurchase,
redemption, defeasance or other acquisition or retirement for value shall
be excluded in the calculation of the amount of Restricted Payments;
(iii) dividends paid within 60 days after the late of declaration
thereof if at such date of declaration such dividend would have complied
with Section 5.4(a); PROVIDED, HOWEVER, that such dividend will be included
in the calculation of the amount of Restricted Payments;
(iv) the repurchase of Capital Stock of the Company from
directors, officers or employees of the Company pursuant to the terms of an
employee benefit plan or employment or other agreement; provided that the
aggregate amount of all such repurchases shall not exceed $3,000,000 in any
fiscal year, and $10,000,000 in total;
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(v) up to an aggregate of $10,000,000 of Restricted Payments by
the Company, so long as after giving effect to any such Restricted Payment
on pro forma basis the Company could incur an additional $1.00 of
Indebtedness under Section 5.3(a)(i); and
(vi) Investments in Unrestricted Subsidiaries or joint ventures
in an amount not to exceed $10,000,000 at any time outstanding.
5.5 LIMITATION ON DISTRIBUTIONS FROM RESTRICTED SUBSIDIARIES. The
Company shall not, and shall not permit any Restricted Subsidiary to, create or
otherwise cause or permit to exist or become effective any consensual
encumbrance or restriction on the ability of any Restricted Subsidiary (a) to
pay dividends or make any other, distributions on its Capital Stock to the
Company or a Restricted Subsidiary or pay any Indebtedness owed to the Company,
(b) to make any loans or advances to the Company or (c) to transfer any of its
property or assets to the Company, except:
(i) any encumbrance or restriction pursuant to any Bank Credit
Agreement, any Foreign Credit Agreement or any other agreement in effect at
or entered into on the Senior Note Issue Date;
(ii) any encumbrance or restriction with respect to a Restricted
Subsidiary pursuant to an agreement relating to any Indebtedness Incurred
by such Restricted Subsidiary on or prior to the date on which such
Restricted Subsidiary was acquired by the Company (other than Indebtedness
Incurred as consideration in, or to provide all or any portion of funds or
credit support utilized to consummate, the transaction or series of related
transactions pursuant to which such Restricted Subsidiary became a
Restricted Subsidiary or was acquired by the Company) and outstanding on
such date;
(iii) any encumbrance or restriction pursuant to an agreement
effecting a Refinancing Indebtedness Incurred pursuant to an agreement
referred to in clause (i) or (ii) of this Section 5.5 or this clause (iii)
or contained in any amendment to an agreement referred to in clause (i) or
(ii) of this Section 5.5 or this clause (iii); provided, however, that the
encumbrances and restrictions with respect to any such Restricted
Subsidiary contained in any such refinancing agreement or amendment are no
less favorable to the Lenders than encumbrances and restrictions with
respect to such Restricted Subsidiary contained in such agreements;
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(iv) any such encumbrance or restriction (A) consisting of
customary non-assignment provisions in leases to the extent such provisions
restrict the subletting, assignment or transfer of the lease or the
property leased thereunder or in purchase money financing or (B) by virtue
of any Indebtedness, transfer, option or right with respect to, or any Lien
on, any property or assets of the Company or any Restricted Subsidiary not
otherwise prohibited by this Agreement;
(v) in the case of Section 5.5(iii), restrictions contained in
security agreements or mortgages securing Indebtedness of a Restricted
Subsidiary to the extent such restrictions restrict the transfer of the
property subject to such security agreements or mortgages;
(vi) encumbrances or restrictions imposed by operation of any
applicable law, rule, regulation or order;
(vii) any restriction with respect to a Restricted Subsidiary
imposed pursuant to an agreement entered into for the sale or disposition
of all or substantially all the Capital Stock or assets of such Restricted
Subsidiary pending the closing of such sale or disposition; and
(viii) any restriction imposed during an event of default under an
agreement governing Indebtedness of any Foreign Subsidiary so long as such
Indebtedness is permitted by Section 5.3.
5.6 LIMITATION ON SALES OF ASSETS AND SUBSIDIARY STOCK. (a) The
Company shall not, and shall not permit any Restricted Subsidiary to, directly
or indirectly, consummate any Asset Disposition unless (i) the Company or such
Restricted Subsidiary receives consideration at the time of such Asset
Disposition at least equal to the fair market value (including the value of all
non-cash consideration), as determined in good faith by the Board of Directors
of the Company, of the shares and assets subject to such Asset Disposition, and
at least 75% of the consideration thereof received by the Company or such
Restricted Subsidiary is in the form of cash or cash equivalents and (ii) an
amount equal to 100% of the Net Available Cash from such Asset Disposition is
applied by the Company (or such Restricted Subsidiary, as the case may be) (A)
first, to either (i) prepay, repay, redeem or purchase (and permanently reduce
the commitments under) Indebtedness under any Bank Credit Agreement or any
Foreign Credit Agreement or that is otherwise secured by its assets subject to
such Asset Disposition within one year
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from the later of the date of such Asset Disposition or the receipt of such Net
Available Cash (the "Receipt Date") or (ii) to the extent the Company elects,
to acquire Additional Assets, PROVIDED, HOWEVER, that the Company shall be
required to commit such Net Available Cash to the acquisition of Additional
Assets within one year from the later of the date of such Asset Disposition or
the Receipt Date and shall be required to consummate the acquisition of such
Additional Assets within 18 months from the Receipt Date; (B) second, to the
extent of the balance of such Net Available Cash after application in
accordance with clause (A), to make an offer pursuant to paragraph (b) below to
the Lenders to repay Notes at the times and in the amounts described in clause
(b) of this Section; and (C) third, to the extent of the balance of such Net
Available Cash after application in accordance with clauses (A) and (B) to any
other application or use not prohibited by this Agreement. Notwithstanding the
foregoing provisions of this paragraph, the Company and the Restricted
Subsidiaries shall not be required to apply the Net Available Cash in
accordance with this paragraph except to the extent that the aggregate Net
Available Cash from all Asset Dispositions which is not applied in accordance
with this paragraph exceeds $5,000,000 (at which time, the entire unutilized
Net Available Cash, and not just the amount in excess of $5,000,000, shall be
applied pursuant to this paragraph). Pending application of Net Available Cash
pursuant to this Section 5.6, such Net Available Cash shall be invested in
Permitted Investments.
For the purposes of this Section 5.6, the following are deemed to be
cash or cash equivalents: (x) the express, assumption of Indebtedness of the
Company or any Restricted Subsidiary and the release of the Company or such
Restricted Subsidiary from all liability on such Indebtedness in connection
with such Asset Disposition, and (y) Notes received by the Company or any
Restricted Subsidiary from the transferee that are converted by the Company or
such Restricted Subsidiary into cash within 90 days of closing the transaction.
(b) Unless each affected Lender otherwise consents, in the event
of an Asset Disposition that requires the repayment of Notes pursuant to Section
5.6(a)(ii)(B), the Company will be required to repay the principal amount of
the Notes in an amount which is proportionately equal to any prepayment or
repurchase of the Senior Notes in accordance with section 4.6 of the Indenture,
concurrently with the making of the offer contemplated by that Section, and
shall make its repayment of the Notes concurrently with the making of any
required repurchase or repayment of the Senior Notes.
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5.7 LIMITATION ON TRANSACTIONS WITH AFFILIATES. (a) The Company
shall not, and shall not permit any Restricted Subsidiary to, enter into any
transaction (including the purchase, sale, lease or exchange of any property or
the rendering of any service) with any Affiliate of the Company other than the
Company or a Restricted Subsidiary (an "Affiliate Transaction") unless the terms
thereof (1) are no less favorable to the Company or such Restricted Subsidiary
than those that could be obtained at the time of such transaction in a
comparable transaction in arm's-length dealings with a Person who is not such an
Affiliate, (2) if such Affiliate Transaction involves an amount in excess of
$2,000,000, (i) are set forth in writing and (ii) have been approved by a
majority of the members of the Board of Directors of the Company having no
material personal financial stake in such Affiliate Transaction, and (3) if such
Affiliate Transaction involves an amount in excess of $7,500,000, have been
determined by a nationally recognized investment banking firm to be fair, from a
financial standpoint, to the Company or its Restricted Subsidiary, as the case
may be.
(b) The foregoing provisions of Section 5.7(a) shall not prohibit
(i) any Permitted Investment or Restricted Payment permitted to be made pursuant
to Section 5.4, or any payment or transaction specifically excepted from the
definition of Restricted Payment, (ii) any issuance of securities, or other
payments, awards or grants in cash, securities or otherwise pursuant to, or the
funding of, employment arrangements, collective bargaining arrangements,
employee benefit plans, health and life insurance plans, deferred compensation
plans, directors, and officers, indemnification agreements, retirement or
savings plans, stock options and stock ownership plans or any other similar
arrangement heretofore or hereafter entered into in the ordinary course of
business and approved by the Board of Directors of the Company or any Restricted
Subsidiary, (iii) the grant of stock options or similar rights to employees and
directors pursuant to plans approved by the Board of Directors of the Company or
the board of directors of the relevant Restricted Subsidiary (iv) loans or
advances to officers, directors or employees heretofore or hereafter entered
into in the ordinary course of business or pursuant to compensation plans or
employment agreements approved by the board of directors of the Company or any
Restricted Subsidiary, (v) the payment of reasonable fees to directors of the
Company and its Restricted Subsidiaries who are not employees of the Company or
its Subsidiaries who are not employees of the Company or its Restricted
Subsidiaries, (vi) any transaction between the Company and a Restricted
Subsidiary or between Restricted Subsidiaries, (vii) the purchase of or the
payment of Indebtedness of or monies owed by the Company or any of its
Restricted Subsidiaries for goods or materials purchased, or services received,
in the ordinary course of business, (viii) management agreements
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between the Company or any of its Restricted Subsidiaries and one or more
Permitted Holders, or any of their respective Affiliates providing for
management fees not to exceed $350,000 per year to William E. Simon & Sons, LLC
("WESS") or any of its Affiliates and $350,000 per year to Oaktree Capital
Management, LLC, TCW Special Credits Fund - V - Principal Fund or any of their
Affiliates; and (ix) the performance of the agreement between WESS, W.E. Myers
& Co. and William E. Myers, Jr. as in effect on the Senior Note Issue Date.
5.8 COMPLIANCE CERTIFICATES. The Company shall deliver to the
Administrative Agent within 120 days after the end of each fiscal year of the
Company an Certificate executed by a Senior Officer of the Company, stating that
in the course of the performance by the signers of their duties as officers of
the Company they would normally have knowledge of any Default and whether or not
the signers know of any Default that occurred during the previous year. If they
do, the certificate shall describe the Default, its status and what action the
Company is taking or proposes to take with respect thereto. The Company also
shall comply with Section 314(a)(4) of the Trust Indenture Act.
5.9 FURTHER INSTRUMENTS AND ACTS. Upon request of the
Administrative Agent, the Company will execute and deliver such further
instruments and do such further acts as may be reasonably necessary or proper
to carry out more effectively the purpose of this Agreement.
5.10 LIMITATION ON LIENS. The Company shall not, and shall not
permit any Restricted Subsidiary to, directly or indirectly, create or permit
to exist any Lien on any of its property or assets, now owned or hereafter
acquired, securing any obligation unless concurrently with the creation of such
Lien effective provision is made to secure the Notes and the Guaranties equally
and ratably with such obligation for so long as such obligation is so secured;
PROVIDED, that, if such obligation is a Subordinated Obligation, the Lien
securing such obligation shall be subordinated and junior to the Lien securing
the Notes and the Guaranties with the same or lesser relative priority as such
Subordinated Obligation shall have been with respect to the Notes and the
Guaranties. The preceding restriction shall not require the Company or any
Restricted Subsidiary to secure the Notes or the Guaranties if the Lien
consists of the following:
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(a) Liens on accounts receivable of the Company and its Restricted
Subsidiaries to secure Indebtedness permitted to be incurred pursuant to
paragraph (a) or clause (vii) or (x) of paragraph (b) of Section 5.3;
(b) Liens created by the Agreement, Liens under any Bank Credit
Agreement, Liens under any Foreign Credit Agreement and Liens existing as
of the Senior Note Issue Date;
(c) Permitted Liens;
(d) Liens to secure Indebtedness issued by the Company or a
Restricted Subsidiary for the purpose of financing all or a part of the
purchase price of assets or property acquired or constructed in the
ordinary course of business after the Senior Note Issue Date; PROVIDED,
however, that (a) the aggregate principal amount (or accredited value in
the case of Indebtedness issued at a discount) of Indebtedness so issued
shall not exceed the lesser of the cost or fair market value, as determined
in good faith by the Board of Directors of the Company, of the assets or
property so acquired or constructed, (b) the Indebtedness secured by such
Liens shall have been permitted to be Incurred under Section 5.3 and (c)
such Liens shall not encumber any other assets or property of the Company
or any of its Restricted Subsidiaries other than such assets or property or
any improvement on such assets or property and shall attach to such assets
or property within 90 days of the construction or acquisition of such
assets or property;
(e) Liens on the assets or property of a Restricted Subsidiary
existing at the time such Restricted Subsidiary becomes a Restricted
Subsidiary and not issued as a result of (or in connection with or in
anticipation of) such Restricted Subsidiary becoming a Restricted
Subsidiary; PROVIDED, however, that such Liens do not extend to or cover
any other property or assets of the Company or any of its other Restricted
Subsidiaries;
(f) Liens securing Capital Lease Obligations incurred in accordance
with Section 5.3;
(g) Liens with respect to Sale/Leaseback Transactions or other
Indebtedness permitted by Section 5.3(b)(xi);
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(h) Liens securing Indebtedness issued to refinance Indebtedness
which has been secured by a Lien permitted under this Agreement and is
permitted to be refinanced under this Agreement; PROVIDED, HOWEVER, that
such Liens do not extend to or cover any property or assets of the Company
or any of its Restricted Subsidiaries not securing the Indebtedness so
refinanced; or
(i) Liens on assets of the Company or any of its Restricted
Subsidiaries, securing Indebtedness in an aggregate principal amount not to
exceed $10,000,000.
5.11 LIMITATION ON SALE\LEASEBACK TRANSACTIONS. The Company shall
not, and shall not permit any Restricted Subsidiary to, enter into any
Sale/Leaseback Transaction with respect to any property unless (i) the Company
or such Restricted Subsidiary would be (A) in compliance with Section 5.3
immediately after giving effect to such Sale/Leaseback Transaction and (B)
entitled to create a Lien on such property securing the Attributable Debt with
respect to such Sale/Leaseback Transaction without securing the Notes pursuant
to Section 5.10, (ii) the net proceeds received by the Company or any Restricted
Subsidiary in connection with such Sale/Leaseback Transaction are at least equal
to the fair market value (as determined by the Board of Directors of the
Company) of such property and (iii) the Company or such Restricted Subsidiary
applies the proceeds of such transaction in compliance with Section 5.6.
5.12 LIMITATION ON THE SALE OR ISSUANCE OF CAPITAL STOCK OF
RESTRICTED SUBSIDIARIES. The Company shall not sell or otherwise dispose of
any shares of Capital Stock of a Restricted Subsidiary, and shall not permit
any Restricted Subsidiary, directly or indirectly, to issue or sell or
otherwise dispose of any shares of its Capital Stock to any Person (other than
to the Company or a Wholly Owned Subsidiary) or permit any Person (other than
the Company or a Wholly Owned Subsidiary) to own any Capital Stock of a
Restricted Subsidiary, if in either case as a result thereof such Restricted
Subsidiary would no longer be a Restricted Subsidiary; PROVIDED, HOWEVER, that
this provision shall not prohibit (x) the Company or any Restricted Subsidiary
from selling, leasing or otherwise disposing of all of the Capital Stock of any
Restricted Subsidiary or (y) the designation of a Restricted Subsidiary as an
Unrestricted Subsidiary in compliance with this Agreement. The foregoing shall
not apply to any Lien granted on the Capital Stock of a Restricted Subsidiary.
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5.13 PAYMENT OF TAXES AND OTHER CLAIMS. The Company shall, and
shall cause each of its Restricted Subsidiaries to, pay or discharge or cause,
to be paid or discharged, before the same shall become delinquent, all taxes,
assessments and governmental charges levied or imposed upon its or its
Restricted Subsidiaries, income, profits or property; PROVIDED, HOWEVER, that
neither the Company nor any of its Subsidiaries shall be required to pay or
discharge or cause to be paid or discharged any such tax, assessment, charge or
claim whose amount, applicability or validity is being contested in good faith
by appropriate negotiations or proceedings and for which disputed amounts
adequate reserves have been made in accordance with GAAP.
5.14 CORPORATE EXISTENCE. Subject to Section 5.16 and Section 5.6,
the Company shall do or cause to be done, at its own cost and expense, all
things necessary to, and will cause each of its Restricted Subsidiaries to,
preserve and keep in full force and effect the corporate or partnership
existence and rights (charter and statutory), licenses and/or franchises of the
Company and each of its Restricted Subsidiaries; PROVIDED, HOWEVER, that the
Company or any of its Restricted Subsidiaries shall not be required to preserve
any such rights, licenses or franchises if the Board of Directors of the Company
shall reasonably determine that the preservation thereof is no longer desirable
in the conduct of the business of the Company and the Restricted Subsidiaries,
taken as a whole.
5.15 FUTURE GUARANTORS. The Company shall (a) cause each Person
which hereafter becomes a Guarantor Subsidiary to execute and deliver to the
Administrative Agent a Guaranty reasonably satisfactory to the Administrative
Agent pursuant to which such Restricted Subsidiary will Guarantee payment of the
Notes on the terms set forth in this Agreement, (b) cause LEP Canada to enter
into the Guaranty as soon as is reasonably practicable and in any event within
90 days following the date hereof, and (c) deliver to the Administrative Agent
an Opinion of Counsel stating that such Guaranty has been duly authorized,
executed and delivered by such Restricted Subsidiary and constitutes a legal,
valid, binding and enforceable obligation of such Restricted Subsidiary. Each
Guaranty will be limited in amount to an amount not to exceed the maximum amount
that can be Guaranteed by the applicable Guarantor without rendering such
Guaranty voidable under applicable law relating to fraudulent conveyance or
fraudulent transfer or similar laws affecting the rights of creditors generally.
5.16 MERGER, CONSOLIDATION AND SALE OF ASSETS. The Company shall
not, and shall not cause or permit any Guarantor Subsidiary to, and no Guarantor
Subsidiary
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(other than any Guarantor Subsidiary whose Guaranty is to be released
in accordance with the terms of the Guaranty and the Indebtedness in connection
with Section 5.6) shall consolidate with or merge with or into, or convey,
transfer or lease, in one transaction or a series of transactions, its assets
substantially as an entirety to, any Person (other than, in the case of a
Guarantor Subsidiary, to the Company or any other Guarantor Subsidiary), unless:
(i) the resulting, surviving or transferee Person (the
"Successor Company") shall be a Person organized and existing under the
laws of the United States of America, any State thereof or the District of
Columbia and the Successor Company (if not the Company or, in the case of a
Guarantor Subsidiary, the Company or a Guarantor Subsidiary) shall
expressly assume, by an agreement executed and delivered to the
Administrative Agent and the Lenders, in form satisfactory to the
Administrative Agent, all the obligations of the Company under the Notes
and this Agreement or of a Guarantor Subsidiary under the applicable
Guaranty, as applicable;
(ii) immediately after giving effect to such transaction (and
treating any Indebtedness which becomes an obligation of such Successor
Company or any Subsidiary as a result of such transaction as having been
Incurred by such Successor Company or such Subsidiary at the time of such
transaction), no Default shall have occurred and be continuing;
(iii) immediately after giving effect to such transaction, the
Successor Company will be able to Incur an additional $1.00 of Indebtedness
pursuant to Section 5.3(a)(i) in the case of the Company or Section
5.3(a)(ii) in the case of a Guarantor Subsidiary;
(iv) immediately after giving effect to such transaction, the
Successor Company shall have Consolidated Net Worth in an amount that is
not less than the Consolidated Net Worth of the Company or such Guarantor
Subsidiary, as applicable, prior to such transaction minus any costs
incurred in connection with such transaction; and
(v) the Company or such Guarantor Subsidiary, as applicable,
shall have delivered to the Administrative Agent a Certificate of a
Responsible Official and
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an Opinion of Counsel, each stating that such consolidation, merger or
transfer comply with this Agreement.
Opinion of counsel required to be delivered under this Section or
elsewhere in this Agreement may have qualifications customary for opinions of
the type required and counsel delivering such opinions of counsel may rely on
certificates of the Company or government or other officials customary for
opinions of the type required, including certificates certifying as to matters
of fact.
The Successor Company shall be the successor to the Company or the
Guarantor Subsidiary, as applicable, and shall succeed to, and be substituted
for, and may exercise every right and power of, the Company or the Guarantor
Subsidiary, as applicable, under this Agreement, but the predecessor company,
only in the case of a conveyance, transfer or lease, will not be released from
the obligation to pay the principal of and interest on the Notes.
Notwithstanding the foregoing, (i) any Subsidiary may consolidate
with, merge into or transfer all or part of its properties and assets to the
Company and (ii) the Company may merge with an Affiliate incorporated for the
purpose of reincorporating the Company in another jurisdiction to realize tax or
other benefits.
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ARTICLE VI
CONDITIONS
6.1 CONDITIONS. The effectiveness of this Agreement and the
obligations of each Lender hereunder are subject to the following conditions
precedent:
(a) The Administrative Agent shall have received all of the
following, each of which shall be an original unless otherwise specified,
each properly executed by a Responsible Official of each party thereto,
each dated as of the Closing Date and each in form and substance
satisfactory to the Administrative Agent and its legal counsel (unless
otherwise specified or, in the case of the date of any of the following,
unless the Administrative Agent otherwise agrees or directs):
(i) executed counterparts of this agreement, sufficient in
number for distribution to the Lenders and the Company;
(ii) Notes executed by the Company in favor of each Lender
in an amount equal to that Lender's Pro Rata Share;
(iii) the Guaranty executed by each of the Guarantor
Subsidiaries;
(iv) a Certificate executed by a Responsible Official of
each of the Company and each Guarantor Subsidiary, attaching a good
standing certificate as to each such person and a resolution
authorizing the transactions contemplated hereby, and certifying that
there have been no amendments or other changes to the articles of
incorporation, bylaws or other organizational papers of such Persons
which have not been delivered to the Administrative Agent in
connection with the Bank Credit Agreement (other than any amendments
or other changes attached thereto) and setting forth exemplars of the
signatures of all Persons authorized to sign the Loan Documents on
behalf of each such Person;
(v) the Opinion of Counsel;
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(vi) a Certificate of a Responsible Official signed by a
Senior Officer of the Company certifying that the conditions specified
in Sections 6.1(b) through (g) of the Agreement have been satisfied;
(vii) a Certificate of a Responsible Official of the Company
signed by a Senior Officer thereof, certifying as to the Solvency of
the Company and its Guarantor Subsidiaries as of the Closing Date; and
(viii) the payment of all fees and expenses of the
Administrative Agent required hereby or pursuant to the terms of the
Agent's Letter.
(b) As of the Closing Date, the representations and warranties
contained in Article IV of this Agreement shall be true and correct;
(c) As of the Closing Date, the Company and its Subsidiaries and
any other Parties shall be in compliance with all the terms and provisions
of the Loan Documents, and no Default or Event of Default shall have
occurred and be continuing;
(d) No material adverse change in the property, operations,
business prospects, profits or financial condition of the Company and its
Subsidiaries, taken as a whole, since December 31, 1997;
(e) Following June 30, 1998, the Company shall have received not
less than $14,550,000 in additional cash equity contributions from the
Sponsors, pursuant to instruments, documents and agreements acceptable to
the Administrative Agent in its sole discretion;
(f) The Company shall have acquired (or shall concurrently
acquire) substantially all of the assets of Caribbean Air Services, Inc. in
accordance with the terms of the CAS Purchase Agreement and all applicable
laws;
(g) There shall not be then pending or threatened any action,
suit, proceeding or investigation against or affecting the Company or any
of its
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Subsidiaries or any Property of any of them before any Governmental Agency
that could reasonably be expected to have a Material Adverse Effect;
(h) The Administrative Agent shall have timely received a
Pricing Designation in compliance with Article II; and
(i) The Administrative Agent shall have received, in form and
substance reasonably satisfactory to the Administrative Agent, such other
assurances, certificates, documents or consents related to the foregoing as
the Administrative Agent reasonably may require.
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ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT
7.1 EVENTS OF DEFAULT. The existence or occurrence of any one or
more of the following events, whatever the reason therefor and under any
circumstances whatsoever, shall constitute an Event of Default:
(a) The Company fails to pay any principal on any of the Notes,
or any portion thereof, when due; or
(b) The Company fails to pay any interest on any of the Notes or
any fee or other amount payable by the Company to any of the Creditors
under any Loan Document within thirty days after the date when due; or
(c) The Company fails to comply with Section 5.16; or
(d) The Company fails to comply for 30 days after the giving of
notice to the Company by the Administrative Agent with any of Sections 5.3,
5.4, 5.6 or 5.11; or
(e) The Company fails to comply for 60 days after the Company
receives the notice specified below with any of its other agreements in
this Agreement (other than those referred to in Sections 7.1(a) through (d)
above); or
(f) Indebtedness of the Company or any Significant Subsidiary is
not paid within any applicable grace period after final maturity or is
accelerated by the holders thereof because of a default and the total
amount of such Indebtedness unpaid or accelerated exceeds $10,000,000 or
its foreign currency equivalent at the time; or
(g) The Company or any Significant Subsidiary of the Company
pursuant to or within the meaning of any Debtor Relief Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief against it in
an involuntary case in which it is the debtor;
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(C) consents to the appointment of a Custodian of it or for any
substantial part of its property; or
(D) makes a general assignment for the benefit of its creditors;
or takes any comparable action under any foreign laws having a similar
effect or purpose as the Debtor Relief Laws; or
(h) a court of competent jurisdiction enters an order or decree
under any Debtor Relief Law that:
(A) Is for relief against the Company or any Significant
Subsidiary of the Company in an involuntary case;
(B) appoints a Custodian of the Company or any Significant
Subsidiary of the Company or for any substantial part of the property
of the Company or Significant Subsidiary; or
(C) orders the winding up or liquidation of the Company or any
Significant Subsidiary of the Company;
(or any similar relief is granted under any foreign laws having a similar
effect or purpose as the Debtor Relief Laws) and the order or decree
remains unstayed and in effect for 60 days; or
(i) The rendering of any judgment or decree for the payment of
money in excess of $10,000,000, or its foreign equivalent at the time, is
entered against the Company or any Significant Subsidiary if such judgment
or decree remains outstanding for a period of 60 days following entry of
such judgment and is not discharged, bonded, waived or stayed, in each case
within 30 days after notice thereof.
7.2 REMEDIES UPON EVENT OF DEFAULT. Without limiting any other
rights or remedies of the Administrative Agent or the Lenders provided for
elsewhere in this Agreement, or the Loan Documents, or by applicable Law, or in
equity, or otherwise, upon the occurrence, and during the continuance, of any
Event of Default, all obligations of the Creditors and all rights of the Company
and any other Parties under the Loan
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Documents shall be suspended without notice to or demand upon the Company,
which are expressly waived by the Company, EXCEPT that the Majority Lenders
may waive the Event of Default, which waiver shall apply equally to, and
shall be binding upon, all the Lenders.
(a) Upon the occurrence of any Event of Default, the
Administrative Agent shall, upon the direction of the Majority Lenders,
without notice to (EXCEPT as expressly provided for in any Loan Document)
or demand upon the Company, which are expressly waived by the Company
(EXCEPT as to notices expressly provided for in any Loan Document), proceed
in accordance with applicable Laws (but only with the consent of the
Majority Lenders) to protect, exercise and enforce their rights and
remedies under the Loan Documents against the Company, the Guarantor
Subsidiaries and any other Party and such other rights and remedies as are
provided by Law or equity.
(b) The Administrative Agent shall have the right, in its sole
discretion, to determine which rights and remedies it shall at any time
pursue, relinquish, subordinate, modify or take any other action with
respect thereto, without in any way modifying or affecting any of them or
any of the Lenders' rights hereunder; and any moneys, deposits,
receivables, balances or other property which may come into any Lender's or
the Administrative Agent's possession at any time or in any manner, may be
retained by such Lender or the Administrative Agent and applied to any of
the Obligations as provided under any of the Loan Documents or as provided
under applicable law.
(c) The order and manner in which the Lenders' rights and
remedies are to be exercised shall be determined by the Majority Lenders in
their sole discretion, and all payments received by the Administrative
Agent and the Lenders, or any of them, shall be applied first to the costs
and expenses (including attorneys' fees and disbursements payable pursuant
to Section 9.3) of the Administrative Agent, acting as Administrative
Agent, and of the Lenders, and thereafter paid pro rata to the Lenders in
the same proportions that the aggregate Obligations owed to each Lender
under the Loan Documents bear to the aggregate Obligations owed under the
Loan Documents to all the Lenders, without priority or preference among the
Lenders. Regardless of how each Lender may treat payments for the purpose
of its own accounting, for the purpose of computing the Obligations
hereunder and under the Notes, payments shall be applied first, to the
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costs and expenses of the Administrative Agent, acting as the
Administrative Agent and the Lenders, as set forth above, second, to the
payment of accrued and unpaid interest due under any Loan Documents to and
including the date of such application (ratably, and without duplication,
according to the accrued and unpaid interest due under each of the Loan
Documents), and third, to the payment of all other amounts (including
principal and fees) then owing to the Administrative Agent or the Lenders
under the Loan Documents. No application of payments will cure any Event
of Default, or prevent acceleration, or continued acceleration, of amounts
payable under the Loan Documents, or prevent the exercise, or continued
exercise, of rights or remedies of the Lenders hereunder or thereunder or
at law or in equity.
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ARTICLE VIII
THE ADMINISTRATIVE AGENT
8.1 APPOINTMENT AND AUTHORIZATION. Each Lender hereby irrevocably
appoints ING Capital as Administrative Agent, and authorizes ING Capital to take
such action as agent on that Lender's behalf and to exercise such powers under
the Loan Documents as are delegated to the Administrative Agent by the terms
thereof or are reasonably incidental thereto, as determined by the
Administrative Agent. This appointment and authorization is intended solely for
the purpose of facilitating the servicing of the Loan and does not constitute
appointment of the Administrative Agent as trustee for any Lender or as
representative of any Lender for any other purpose and, EXCEPT as specifically
set forth in the Loan Documents to the contrary, the Administrative Agent shall
each take such action and exercise such powers only in an administrative and
ministerial capacity. The Administrative Agent is a representative of the
Lenders only and assumes no agency, trust, fiduciary or other special
relationship with any other party hereto, express or implied.
8.2 ADMINISTRATIVE AGENT AND AFFILIATES. ING Capital (and each
successor Administrative Agent has the same rights and powers under the Loan
Documents as any other Lender and may exercise the same as though it were not
the Administrative Agent. The term "Lender" or "Lenders" includes ING Capital
in its individual capacity. ING Capital (and each successor Administrative
Agent) and its Affiliates may accept deposits from, lend money to and generally
engage in any kind of banking, trust or other business with the Company or any
Affiliate of the Company as if it were not the Administrative Agent, and without
any duty to account therefor to the Lenders. No implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or otherwise exist against the Administrative Agent.
8.3 PROPORTIONATE INTEREST OF THE LENDERS IN ANY COLLATERAL. The
Administrative Agent, on behalf of all the Lenders, shall hold in accordance
with the Loan Documents all items of any collateral or interests therein
received or held by the Administrative Agent. Subject to the Administrative
Agent's and the Lenders' rights to reimbursement for their costs and expenses
hereunder (INCLUDING attorneys' fees and disbursements and other professional
services) and subject to the application of payments in accordance with
Section 7.2(c), each Lender shall have an interest in any collateral or
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interests therein in the same proportions that the aggregate Obligations owed
such Lender under the Loan Documents bear to the aggregate Obligations owed
under the Loan Documents to all the Lenders, without priority or preference
among the Lenders.
8.4 LENDERS' CREDIT DECISIONS. Each Lender agrees that it has,
independently and without reliance upon the Administrative Agent, any other
Lender or the directors, officers, agents, employees or attorneys of the
Administrative Agent or any other Lender, and instead in reliance upon
information supplied to it by or on behalf of the Company and its
Subsidiaries and upon such other information as it has deemed appropriate,
made its own independent credit analysis and decision to enter into this
Agreement. Each Lender also agrees that it shall, independently and without
reliance upon the Administrative Agent, any other Lender or the directors,
officers, agents, employees or attorneys of the Administrative Agent or any
other Lender, continue to make its own independent credit analyses and
decisions in acting or not acting under the Loan Documents.
8.5 ACTION BY ADMINISTRATIVE AGENT.
(a) The Administrative Agent may assume that no Default or Event
of Default has occurred and is continuing, unless the Administrative Agent
has received notice from the Company stating the nature of the Default or
has received notice from a Lender stating the nature of the Default or
Event of Default and that such Lender considers the Default to have
occurred and to be continuing.
(b) The Administrative Agent has only those obligations under
the Loan Documents as are expressly set forth therein.
(c) Except for any obligation expressly set forth in the Loan
Documents and as long as the Administrative Agent may assume that no
Default or Event of Default has occurred and is continuing, the
Administrative Agent may, but shall not be required to exercise its
discretion to act or not act, EXCEPT that the Administrative Agent shall be
required to act or not act upon the instructions of the Majority Lenders
(or of all the Lenders, to the extent required by Section 9.2) and those
instructions shall be binding upon the Administrative Agent and all the
Lenders, PROVIDED that the Administrative Agent shall not be required to
act or not act if to do so would be contrary to any Loan Document or to
applicable Law or
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would result, in the reasonable judgment of the Administrative Agent in
substantial risk of liability to the Administrative Agent.
(d) If the Administrative Agent has received a notice specified
in Section 8.5(a), the recipient of such notice shall immediately give
notice thereof to the Lenders and shall act or not act upon the
instructions of the Majority Lenders (or of all the Lenders, to the extent
required by Section 9.2), PROVIDED that the Administrative Agent shall not
be required to act or not act if to do so would be contrary to any Loan
Document or to applicable Law or would result, in the reasonable judgment
of the Administrative Agent, in a substantial risk of liability to the
Administrative Agent.
(e) The Administrative Agent shall not have any liability to any
Lender for acting, or not acting, as instructed by the Majority Lenders (or
all the Lenders, if required under Section 9.2), notwithstanding any other
provision hereof.
8.6 LIABILITY OF ADMINISTRATIVE AGENT. Neither the Administrative
Agent nor any of its directors, officers, agents, employees or attorneys shall
be liable for any action taken or not taken by them under or in connection with
the Loan Documents, EXCEPT for their own gross negligence or willful misconduct.
Without limitation on the foregoing, the Administrative Agent and its directors,
officers, agents, employees and attorneys:
(a) May treat the payee of any Note as the holder thereof until
the Administrative Agent receives notice of the assignment or transfer
thereof, in form satisfactory to the Administrative Agent, signed by the
payee, and may treat each Lender as the owner of that Lender's interest in
the Obligations for all purposes of this Agreement until the Administrative
Agent receives notice of the assignment or transfer thereof, in form
satisfactory to the Administrative Agent, signed by that Lender.
(b) May consult with legal counsel (INCLUDING internal legal
counsel), accountants (INCLUDING internal accountants) and other
professionals or experts selected by it, or with legal counsel, accountants
or other professionals or experts for the Company or its Subsidiaries or
the Lenders, and shall not be liable
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for any action taken or not taken by it in good faith in accordance with
any advice of such legal counsel, accountants or other professionals or
experts.
(c) Shall not be responsible to any Lender for any statement,
warranty or representation made in any of the Loan Documents or in any
notice, certificate, report, request or other statement (written or oral)
given or made in connection with any of the Loan Documents.
(d) EXCEPT to the extent expressly set forth in the Loan
Documents, shall have no duty to ask or inquire as to the performance or
observance by the Company or its Subsidiaries of any of the terms,
conditions or covenants of any of the Loan Documents or to inspect any
collateral or the Property books or records of the Company or its
Subsidiaries.
(e) Will not be responsible to any Lender for the due execution,
legality, validity, enforceability, genuineness, effectiveness, sufficiency
or value of any Loan Document, any other instrument or writing furnished
pursuant thereto or in connection therewith, or any collateral.
(f) Will not incur any liability by acting or not acting in
reliance upon any Loan Document, notice, consent, certificate, statement,
request or other instrument or writing believed by it to be genuine and
signed or sent by the proper party or parties.
(g) Will not incur any liability for any arithmetical error in
computing any amount paid or payable by the Company or any Subsidiary or
Affiliate thereof or paid or payable to or received or receivable from any
Lender under any Loan Document, INCLUDING, without limitation, principal,
interest and other amounts; PROVIDED that, promptly upon discovery of such
an error in computation, the Creditors and (to the extent applicable) the
Company or its Subsidiaries or Affiliates shall make such adjustments as
are necessary to correct such error and to restore the parties to the
position that they would have occupied had the error not occurred.
8.7 INDEMNIFICATION. Each Lender shall, ratably in accordance
with its Pro Rata Share, indemnify and hold the Administrative Agent and its
directors, officers, agents, employees and attorneys harmless against any and
all liabilities, obligations,
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losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature, whatsoever (INCLUDING, without
limitation, attorneys' fees and disbursements) that may be imposed on,
incurred by or asserted against it or them in any way relating to or arising
out of the Loan Documents (other than losses incurred by reason of the
failure of the Company to pay the indebtedness represented by the Notes) or
any action taken or not taken by it as Administrative Agent thereunder,
EXCEPT such as result from its own gross negligence or willful misconduct.
Without limitation on the foregoing, each Lender shall reimburse the
Administrative Agent upon demand for that Lender's ratable share of any cost
or expense incurred by the Administrative Agent in connection with the
negotiation, preparation, execution, delivery, amendment, waiver,
restructuring, reorganization (INCLUDING a bankruptcy reorganization),
enforcement or attempted enforcement of the Loan Documents, to the extent
that the Company or any other Party is required by Section 9.3 to pay that
cost or expense but fails to do so upon demand. Nothing in this Section
shall entitle the Administrative Agent to recover any amount from the Lenders
if and to the extent that such amount has theretofore been recovered from the
Company or any of its Subsidiaries.
8.8 SUCCESSOR ADMINISTRATIVE AGENT. If the Administrative Agent
determines that for it to continue as Administrative Agent would result in a
conflict of interest, or would create an unacceptable risk of significant
liability of the Administrative Agent or to a third party, or would otherwise
be inadvisable under prevailing standards of banking prudence, it may resign
as such at any time upon prior written notice to the Company and the Lenders,
to be effective upon a successor's acceptance of appointment as
Administrative Agent. The Administrative Agent may also resign as such absent
such a determination by it with the consent of the Company, which shall not
be unreasonably withheld, to be likewise effective.
If the Administrative Agent so resigns,
(a) the Majority Lenders shall appoint a successor
Administrative Agent, who must be from among the Lenders and be reasonably
acceptable to the Company, PROVIDED that any resigning Administrative Agent
shall be entitled to appoint a successor Administrative Agent from among
the Lenders, subject to acceptance of appointment by that successor
Administrative Agent, if the Majority Lenders have not appointed a
successor within 30 days after the date the resigning Administrative Agent
gave notice of resignation;
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(b) upon a successor's acceptance of appointment as
Administrative Agent the successor will thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the resigning
or removed Administrative Agent;
(c) upon the effectiveness of any resignation, the resigning
Administrative Agent thereupon will deliver to the successor Administrative
Agent, all Records and all other books and records related to its former
role as Administrative Agent; and
(d) upon the delivery of those items specified in
Section 8.8(c), the resigning Administrative Agent thereupon will be
discharged from its duties and obligations thereafter arising under the
Loan Documents other than obligations arising as a result of any action or
inaction of the resigning Administrative Agent prior to the effectiveness
of such resignation.
8.9 NO OBLIGATIONS OF THE COMPANY. Nothing contained in this
Article VIII shall be deemed to impose upon the Company any obligation with
respect to the due and punctual performance by the Administrative Agent of
its obligations to the Lenders under any provision of this Agreement and the
Company shall have no liability to the Administrative Agent or any of the
Lenders with respect to any failure by the Administrative Agent or any Lender
to perform any of its obligations to the Administrative Agent or the Lenders
under this Agreement. Without limiting the generality of the foregoing,
where any provision of this Agreement relating to the payment of any amounts
due and owing under the Loan Documents provides that such payments shall be
made by the Company to the Administrative Agent for the account of the
Lenders, the Company's obligations to the Lenders with respect to such
payments shall be deemed to be satisfied upon the making of such payments to
the Administrative Agent in the manner provided by this Agreement.
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ARTICLE IX
MISCELLANEOUS
9.1 CUMULATIVE REMEDIES: NO WAIVER. The rights, powers,
privileges and remedies of the Creditors provided herein or in any Note or
other Loan Document are cumulative and not exclusive of any right, power,
privilege or remedy provided by Law or equity. No failure or delay on the
part of any Creditor in exercising any right, power, privilege or remedy may
be, or may be deemed to be, a waiver thereof; nor may any single or partial
exercise of any right, power, privilege or remedy preclude any other or
further exercise of the same or any other right, power, privilege or remedy.
The terms and conditions of Article VIII (other than Section 8.8 and 8.9) are
inserted for the sole benefit of the Creditors; the same may be waived in
whole or in part, with or without terms or conditions.
9.2 AMENDMENT: CONSENTS. No amendment, modification, supplement,
extension, termination or waiver of any provision of this Agreement or any
other Loan Document, no approval or consent thereunder, and no consent to any
departure by the Company or any other Party therefrom, may in any event be
effective unless in writing signed by the Administrative Agent with the
approval in writing of the Majority Lenders, and then only in the specific
instance and for the specific purpose given; and, without the approval in
writing of all the Lenders, no amendment, modification, supplement,
termination, waiver or consent may be effective:
(a) To amend or modify the principal of, or the amount of
principal, principal prepayments or the rate of interest payable on, any
Note, or the amount of any fee payable to any Lender under the Loan
Documents;
(b) To postpone any date fixed for any payment of principal of,
prepayment of principal of or any installment of interest on, any Note, or
to extend the Maturity Date;
(c) To amend or modify the provisions of (but not to grant a
waiver under) the definition of "Majority Lenders"; Articles VI or VII; or
this Section; or
(d) To amend or modify any provision of this Agreement that
expressly requires the consent or approval of all the Lenders.
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Any amendment, modification, supplement, termination, waiver or
consent pursuant to this Section shall apply equally to, and shall be binding
upon, all the Lender and the Administrative Agent. No amendment,
modification, supplement, termination, waiver or consent which has a negative
effect upon, or increases the obligations or liabilities of the
Administrative Agent, may be effective without the consent of the
Administrative Agent.
9.3 COSTS, EXPENSES AND TAXES. The Company shall each pay on
demand the reasonable costs and expenses of the Administrative Agent in
connection with the negotiation, preparation, execution and delivery of the
Loan Documents, and of the Administrative Agent and the Lenders in connection
with the amendment, waiver, refinancing, restructuring, reorganization
(INCLUDING a bankruptcy proposal, plan of arrangement or reorganization) and
enforcement or attempted enforcement of the Loan Documents, and any matter
related thereto, INCLUDING, without limitation, filing fees, recording fees,
title insurance fees, appraisal fees, search fees approved by the Company and
other out-of-pocket expenses and the reasonable fees and out-of-pocket
expenses of any legal counsel, independent public accountants and other
outside experts retained by the Administrative Agent INCLUDING, without
limitation, any costs, expenses or fees incurred or suffered by the
Administrative Agent or any Lender in connection with or during the course of
any bankruptcy or insolvency proceedings or proceedings under any Debtor
Relief Law of the Company or any of its Subsidiaries; PROVIDED that the
Administrative Agent and the Lenders shall, in connection with any such
amendment, waiver, refinancing, restructuring, reorganization, enforcement or
attempted enforcement of the Loan Documents be entitled to the services of
only one firm of independent public accountants and shall use their best
efforts to avoid duplicative efforts by legal counsel on behalf of
Administrative Agent, and one or more Lenders. The Company shall pay any and
all documentary and other taxes (other than income or gross receipts taxes
generally applicable to banks) and all costs, expenses, fees and charges
payable or determined to be payable in connection with the filing or
recording of this Agreement, any other Loan Document or any other instrument
or writing to be delivered hereunder or thereunder, or in connection with any
transaction pursuant hereto or thereto, and shall reimburse, hold harmless
and indemnify the Creditors from and against any and all loss, liability or
legal or other expense with respect to or resulting from any delay in paying
or failure to pay any tax, cost, expense, fee or charge or that any of them
may suffer or incur by reason of the failure of any Party to perform any of
its Obligations. Any amount payable to the
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Administrative Agent or any Lender under this Section shall bear interest at
the rate of interest for Base Rate Tranches from the thirtieth day after a
demand for payment.
9.4 NATURE OF LENDERS' OBLIGATIONS. The obligations of the
Lenders hereunder are several and not joint or joint and several. Nothing
contained in this Agreement or any other Loan Document and no action taken by
the Administrative Agent or the Lenders or any of them pursuant hereto or
thereto may, or may be deemed to, make the Lenders a partnership, an
association, a joint venture or other entity, either among themselves or with
the Company or any Affiliate of the Company. Each Lender's obligation to
make its Pro Rata Share of the Loan is several and not joint or joint and
several. A default by any Lender will not increase the Pro Rata Share of any
other Lender.
9.5 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties contained herein or in any other Loan
Document, or in any certificate or other writing delivered by or on behalf of
any one or more of the Parties to any Loan Document, will survive the making
of the Loan hereunder and the execution and delivery of the Notes, and have
been or will be relied upon by the Administrative Agent and each Lender,
notwithstanding any investigation made by the Administrative Agent or any
Lender or on their behalf.
9.6 NOTICES. EXCEPT as otherwise expressly provided in the Loan
Documents:
(a) All notices, requests, demands, directions and other
communications provided for hereunder or under any other Loan Document
must be in writing and must be telecopied (followed within 48 hours by an
original of such notice, request, demand, direction or other
communication delivered in via one of the other methods specified in this
Section, hand-delivered or sent by reputable overnight carrier for
next-day delivery, addressed to the appropriate party at the address set
forth on the signature pages of this Agreement or other applicable Loan
Document or, as to any party to any Loan Document, at any other address
as may be designated by it in a written notice sent to all other parties
to such Loan Document in accordance with this Section.
(b) Except as otherwise expressly provided in any Loan Document,
if any notice, request, demand, direction or other communication required
or permitted by any Loan Document is given by telecopier, when sent, or
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if given by personal delivery, when delivered, or if given by reputable
overnight carrier for next-day delivery, on the next Business Day following
the date of delivery to such carrier.
9.7 EXECUTION OF LOAN DOCUMENTS. Unless the Administrative Agent
otherwise specifies with respect to any Loan Document and except as
specifically provided in any other Loan Document, this Agreement and any
other Loan Document may be executed in any number of counterparts and any
party hereto or thereto may execute any counterpart, each of which when
executed and delivered will be deemed to be an original and all of which
counterparts of this Agreement or any other Loan Document, as the case may be
when taken together will be deemed to be but one and the same instrument.
The execution of this Agreement or any other Loan Document (except as
specifically provided in such other Loan Document) by any party hereto or
thereto will no become effective until counterparts hereof or thereof, as the
case may be, have been executed by all the parties hereto or thereto.
9.8 BINDING EFFECT; ASSIGNMENT.
(a) This Agreement and the other Loan Documents shall be binding
upon and inure to the benefit of the Company and the Creditors, and their
respective successors and assigns, EXCEPT that the Company and its
Affiliates may not assign their rights hereunder or thereunder or any
interest herein or therein without the prior written consent of all the
Lenders. Each Lender shall have the right to sell or transfer any
participation interest in this Agreement, its Note and its Pro Rata Share
in accordance with the provisions of this Section. Each Lender represents
that it is not acquiring its Note with a view to the distribution thereof
within the meaning of the Securities Act of 1933, as amended (subject to
any requirement that disposition of its Notes must be within the control of
such Lender).
(b) Any Lender may assign all or any portion of its Pro Rata
Share to a bank or other financial institution reasonably acceptable to the
Administrative Agent and the Company; PROVIDED that
(i) such assignment shall be evidenced by an Assignment and
Acceptance;
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(ii) such assignment (except to an assignee which is then a
Lender) shall be in an integral multiple of $100,000 which is not less
than $2,500,000;
(iii) such assignee has a minimum net worth of $200,000,000;
(iv) the Administrative Agent consents to such assignment
and has received the payment of an assignment fee from such assignee
(for its sole account) of $3500; and
(v) unless an Event of Default has occurred and remains
continuing, the Company consents to such assignment (such consent not
to be unreasonably withheld).
Upon the execution and delivery of the Assignment and Acceptance,
each assignee financial institution named therein shall be a Lender for all
purposes of this Agreement, with the respective Pro Rata Share therein set
forth and, to the extent of such Pro Rata Share, the assigning Lender shall
be released from its Obligations under this Agreement. The Company agrees
that it shall execute and deliver (against delivery by the assigning Lender
to the Company of its Note) to each such assignee financial institution
Note evidencing that assignee's Pro Rata Share and to the assigning Lender,
Notes evidencing the remaining such Pro Rata Share retained by the
assigning Lender. Upon request by any such assignee financial institution,
the Company shall also provide to that assignee financial institution such
original or conformed copies of documents described in Section 6.1(a) as
may be requested by that assignee financial institution, and shall execute
and deliver such instruments, documents and confirmations, including for
the purposes of protecting and preserving in favor of such assignee, any of
the Liens of the Administrative Agent and Lenders as may be requested.
(c) By executing and delivering an Assignment and Acceptance,
the assignee financial institution thereunder acknowledges and agrees that:
(i) other than the representation and warranty that it is
the legal and beneficial owner of the Pro Rata Share being assigned
thereby free and clear of an adverse claim, the assigning Lender has
made no
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representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with this Agreement or the execution, legality, validity,
enforceability, genuineness or sufficiency of this Agreement or any
other Loan Document;
(ii) the assigning Lender has made no representation or
warranty and assumes no responsibility with respect to the financial
condition of the Company and its Restricted Subsidiaries or the
performance by the Company of the Obligations;
(iii) it has received a copy of this Agreement, together with
copies of the most recent financial statements delivered pursuant to
this Agreement and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance;
(iv) it will, independently and without reliance upon the
Administrative Agent or any Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make
its own credit decisions in taking or not taking action under this
Agreement;
(v) it appoints and authorizes the Administrative Agent to
take such action and to exercise such powers under this Agreement as
are delegated to the Administrative Agent by Article VIII; and
(vi) it will perform in accordance with their terms all of
the Obligations which by the terms of this Agreement are required to
be performed by it as a Lender.
(d) The Administrative Agent shall maintain at the
Administrative Agent's Office a copy of each Assignment and Acceptance
delivered to it and a register for recordation of the names and addresses
of the Lenders and their respective Pro Rata Shares. The entries in such
register shall be conclusive, in the absence of manifest error, and the
Company and the other Creditors may treat each Person whose name is
recorded in the register as a Lender hereunder for all purposes of this
Agreement. Promptly following any entry in the
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register, the Administrative Agent shall provide to the Company and the
other Creditors a revised listing of each Lender's Pro Rata Share giving
effect thereto.
(e) Each Lender may from time to time without the consent of the
Company or the Administrative Agent grant participations to one or more
banks or other financial institutions in a portion of its Pro Rata Share;
PROVIDED, HOWEVER, that
(i) such Lender's obligations under this Agreement and each
of the other Loan Documents shall remain unchanged,
(ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations,
(iii) the Company and the Creditors shall continue to deal
solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement, and
(iv) the consent of the holder of such participation
interest shall not be required for amendments of waivers of provisions
of the Loan Documents other than those that
(A) increase the monetary amount of the outstanding
Loans such that the participation interest would also increase,
(B) extend any maturity date or any other date upon
which any payment of money is due to the Lenders, or
(C) reduce the rate of interest on the Notes, any fee
or any other monetary amount payable to the Lenders in which such
participant has a participating interest.
(v) such participation interest shall be in a minimum
amount of $1,000,000.
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9.9 SHARING OF SETOFFS. Each Lender severally agrees that (a) if it
is a party to the Bank Credit Agreement, it shall not exercise any right of
setoff, banker's lien or counterclaim against the Company by reason of the
obligations under this Agreement at any time when any obligations are
outstanding under the Bank Credit Agreement, and (b) if it, through the exercise
of any right of setoff, banker's lien or counterclaim against the Company, or
otherwise, receives payment of the Obligations held by it that is ratably more
than any other Lender, through any means, receives in payment of the Obligations
held by that Lender, then:
(a) The Lender exercising the right of setoff, banker's lien or
counterclaim or otherwise receiving such payment shall purchase, and shall
be deemed to have simultaneously purchased, from the other Lender a
participation in the Obligations held by the other Lender and shall pay to
the other Lender a purchase price in an amount so that the share of the
Obligations held by each Lender after the exercise of the right of setoff,
banker's lien or counterclaim or receipt of payment shall be in the same
proportion that existed, prior to the exercise of the right of setoff,
banker's lien or counterclaim or receipt of payment; and
(b) such other adjustments and purchases of participations shall
be made from time to time as shall be equitable to ensure that all of the
Lenders share any payment obtained with respect to the Obligations ratably
in accordance with each Lender's share of the Obligations immediately prior
to, and without taking into account, the payment; PROVIDED that, if all or
any portion of a disproportionate payment obtained, as a result of the
exercise of the right of setoff, banker's lien, counterclaim or otherwise
is thereafter recovered from the purchasing Lender by the Company or any
Person claiming through or succeeding to the rights of the Company the
purchase of a participation shall be rescinded and the purchase price
thereof shall be restored to the extent of the recovery, but without
interest. Each Lender that purchases a participation in the Obligations
pursuant to this Section shall from and after the purchase have the right
to give all notices, requests, demands, directions and other communications
under this Agreement with respect to the portion of the Obligations
purchased to the same extent as though the purchasing Lender were the
original owner of the Obligations purchased. The Company expressly
consents to the foregoing arrangements and agrees that any Lender holding a
participation in an Obligation so purchased may exercise any and
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all rights of setoff, banker's lien or counterclaim with respect to the
participation as fully as if the Lender were the original owner of the
Obligation purchased.
9.10 INDEMNITY. The Company agrees to indemnify, save and hold
harmless each Creditor and their respective Affiliates, directors, officers,
agents, attorneys and employees (collectively, the "INDEMNITEES") from and
against:
(a) Any and all claims, demands, actions or causes of action
that are asserted against any Indemnitee by any Person (other than another
Creditor) if the claim, demand, action or cause of action directly or
indirectly relates to a claim, demand, action or cause of action that such
Person asserts or may assert against the Company, any Affiliate thereof or
any officer, director or shareholder of the Company or its Affiliates;
(b) Any and all claims, demands, actions or causes of action if
the claim, demand, action or cause of action arises out of or relates to
the use or contemplated use of proceeds of the Loan, or the relationship of
the Company and the Lenders under this Agreement;
(c) Any and all claims, demands, actions or causes of action if
the claim, demand, action or cause of action arises out of or relates to
any failure of the Company or any of its Subsidiaries to comply with any
tax Law, including without limitation, any failure to pay or remit any
withholding taxes;
(d) Any administrative or investigative proceeding by any
Governmental Agency arising out of or related to a claim, demand, action or
cause of action described in clauses (a), (b) or (c) above; and
(e) Any and all liabilities, losses, costs or expenses
(INCLUDING reasonable attorneys' fees and disbursements and other
professional services) that any Indemnitee suffers or incurs as a result of
the assertion of any foregoing claim, demand, action or cause of action;
PROVIDED that no Indemnitee shall be entitled to indemnification for any loss
caused by its own gross negligence or willful misconduct. If any claim, demand,
action or cause of action is asserted against any Indemnitee, such Indemnitee
shall promptly notify the Company, but the failure to so promptly notify the
Company shall not affect the
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Company's obligations under this Section unless such failure materially
prejudices the Company's right to participate in the contest of such claim,
demand, action or cause of action, as hereinafter provided. Each Indemnitee
may, and if requested by the Company in writing shall, in good faith contest
the validity, applicability and amount of such claim, demand, action or cause
of action with counsel selected by such Indemnitee and reasonably acceptable
to the Company, and shall permit the Company to participate in such contest.
Any Indemnitee that proposes to settle or compromise any claim or proceeding
for which the Company may be liable for payment of indemnity hereunder shall
give the Company written notice of the terms of such proposed settlement or
compromise reasonably in advance of settling or compromising such claim or
proceeding and shall obtain the Company's prior consent, which consent shall
not unreasonably be withheld. In connection with any claim, demand, action
or cause of action covered by this Section against more than one Indemnitee,
all such Indemnitees shall be represented by the same legal counsel selected
by the Indemnitees and reasonably acceptable to the Company; PROVIDED, that
if such legal counsel determines in good faith that representing all such
Indemnitees would or could result in a conflict of interest under Laws or
ethical principles applicable to such legal counsel or that a defense or
counterclaim is available to an Indemnitee that is not available to all such
Indemnitees, then to the extent reasonably necessary to avoid such a conflict
of interest or to permit unqualified assertion of such a defense or
counterclaim, each Indemnitee shall be entitled to separate representation by
legal counsel selected by that Indemnitee and reasonably acceptable to the
company. Any obligation or liability of the Company and the Company to any
Indemnitee under this Section shall survive the expiration or termination of
this Agreement and the repayment of the Loan and the payment and performance
of all other Obligations owed to the Lenders; PROVIDED, however, that such
obligations or liabilities shall not, from and after the date on which the
Notes are fully paid, be deemed Obligations for any purpose under the Loan
Documents.
9.11 NONLIABILITY OF THE LENDERS. The Company acknowledges and agrees
that:
(a) Any inspections of any Property of the Company and its
Subsidiaries made by or through the Administrative Agent or the Lenders are
for purposes of administration of the Loan Documents only and the Company
and its Subsidiaries are not entitled to rely upon the same;
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(b) By accepting or approving anything required to be observed,
performed, fulfilled or given to the Administrative Agent or the Lenders
pursuant to the Loan Documents, neither the Administrative Agent nor the
Lenders shall be deemed to have warranted or represented the sufficiency,
legality, effectiveness or legal effect of the same, or of any term,
provision or condition thereof, and such acceptance or approval thereof
shall not constitute a warranty or representation to anyone with respect
thereto by the Administrative Agent or the Lenders;
(c) The relationship between the Company and the Creditors is,
and shall at all times remain, solely that of a borrower and lenders; and
no Creditor shall under any circumstances be construed to be partners or
joint venturers of the Company or its Affiliates; no Creditor shall under
any circumstance be deemed to be in a relationship of confidence or trust
or a fiduciary relationship with the Company or its Affiliates, or to owe
any fiduciary duty to the Company or its Affiliates; no Creditor undertakes
or assumes any responsibility or duty to the Company or its Affiliates to
select, review, inspect, supervise, pass judgment upon or inform the
Company or its Affiliates of any matter in connection with their Property
or the operations of the Company or its Affiliates; the Company and its
Affiliates shall rely entirely upon their own judgment with respect to such
matters and any review, inspection, supervision, exercise of judgment or
supply of information undertaken or assumed by the Administrative Agent or
the Lenders in connection with such matters is solely for the protection of
the Administrative Agent and the Lenders and neither the Company nor any
other Person is entitled to rely thereon; and
(d) No Creditor shall be responsible or liable to any Person for
any loss, damage, liability or claim of any kind relating to injury or
death to Persons or damage to Property or other loss, damage, liability or
claim caused by the actions, inaction or negligence of the Company hereby
indemnities and holds each Creditor harmless from any such loss, damage,
liability or claim.
9.12 NO THIRD PARTIES BENEFITED. This Agreement is made for the
purpose of defining and setting forth certain obligations, rights and duties of
the Company and the Creditors in connection with the Obligations, and is made
for the sole benefit of the Company and the Creditors and the Creditors'
respective successors and assigns. EXCEPT as provided in Sections 9.8 and 9.11,
no other person shall have any rights of any nature hereunder or by reason
hereof.
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9.13 CONFIDENTIALITY. Each Creditor agrees to hold any confidential
information that it may receive from the Company and its Restricted Subsidiaries
pursuant to this Agreement in confidence, EXCEPT for disclosure;
(a) to other Creditors;
(b) to legal counsel, accountants and other professional
advisors to the Company and its Subsidiaries or any Creditor;
(c) to regulatory officials having jurisdiction over the
Creditors;
(d) as required by Law or legal process (PROVIDED that in the
event any Creditor is so required to disclose any such confidential
information, that Creditor shall endeavor promptly to notify the Company,
so that the Company may seek a protective order or other appropriate
remedy) or in connection with any legal proceeding to which any Creditor
and the Company are adverse parties;
(e) to another financial institution in connection with a
disposition or proposed disposition to that financial institution of all or
part of that Creditor's interests hereunder or a participation interest in
its Notes, provided that such disclosure is made subject to an appropriate
confidentiality agreement on terms substantially similar to this Section
and
(f) to prospective purchasers of any collateral (OTHER than
competitors of the Company or its Subsidiaries unless all the Indebtedness
evidenced by the Notes is then due and payable) in connection with any
disposition thereof, PROVIDED that such disclosure is made subject to an
appropriate confidentiality agreement on terms substantially similar to
this Section.
For purposes of the foregoing, "confidential information" shall mean
all information respecting the Company or its Subsidiaries, OTHER THAN
(g) information previously filed with any Governmental Agency
and available to the public,
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(h) information previously published in any public medium from a
source other than, directly or indirectly, that Creditor and
(i) information previously disclosed by the Company or any of
its Subsidiaries to any Person not associated with the Company without a
written confidentiality agreement.
Nothing in this Section shall be construed to create or give rise to
any fiduciary duty on the part of any Creditor to the Company or its
Subsidiaries.
9.14 INTEGRATION. This Agreement, together with the other Loan
Documents, comprises the complete and integrated agreement of the parties on the
subject matter hereof and supersedes all prior agreements, written or oral, on
the subject matter hereof. In the event of any conflict between the provisions
of this Agreement and those of any other Loan Document, the provisions of this
Agreement shall control and govern; PROVIDED that the inclusion of supplemental
rights or remedies in favor of the Creditors in any other Loan Document shall
not be deemed a conflict with this Agreement. Each Loan Document was drafted
with the joint, participation of the respective parties thereto and shall be
construed neither against nor in favor of any party, but rather in accordance
with the fair meaning thereof.
9.15 GOVERNING LAW. EXCEPT TO THE EXTENT OTHERWISE EXPRESSLY PROVIDED
THEREIN, EACH LOAN DOCUMENT SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.
9.16 SEVERABILITY OF PROVISIONS. Any provision in any Loan Document
that is held to be inoperative, unenforceable or invalid as to any party or in
any jurisdiction shall, as to that party or jurisdiction, be inoperative,
unenforceable or invalid without affecting the remaining provisions or the
operation, enforceability or validity of that provision as to any other party or
in any other jurisdiction, and to this end the provisions of all Loan Documents
are declared to be severable.
9.17 INDEPENDENT REPRESENTATIONS, WARRANTIES, AND COVENANTS. Each
representation, warranty, and covenant in Articles IV and V is independent of
the other representations, warranties, land covenants in those Articles; the
breach of any such
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representation, warranty, or covenant shall not be excused by the fact that
the circumstances underlying such breach would be permitted by another such
representation, warranty or covenant.
9.18 HEADINGS. Article and Section headings in this Agreement and the
other Loan Documents are included for convenience of reference only and are not
part of this Agreement or the other Loan Documents for any other purpose.
9.19 TIME OF THE ESSENCE. Time is of the essence in the Loan
Documents.
9.20 SUBMISSION TO JURISDICTION. Any legal action or proceeding with
respect to this Agreement or any other Loan Document and any action for
enforcement of any judgment in respect thereof may be brought in the courts of
the State of New York or of the United States of America for the Southern
District of New York, and, by execution and delivery of this Agreement, the
Company hereby accepts for itself and with respect to its property, generally
and unconditionally, the non-exclusive jurisdiction of the aforesaid courts and
appellate courts from any thereof. The Company irrevocably consents to the
service of process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to that Person at its address set forth opposite its signature
below. The Company hereby irrevocably waives any objection which it may now or
hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement or any other
Loan Document brought in the courts referred to above and hereby further
irrevocably waives and agrees not to plead or claim in any such court that any
such action or proceeding brought in any such court has been brought in an
inconvenient forum. Nothing herein shall affect the right of the Creditors or
any other Person to serve process in any other manner permitted by law or to
commence legal proceedings or otherwise proceed against the Company in any other
jurisdiction.
9.21 PURPORTED ORAL AMENDMENTS. THE COMPANY AND THE CREDITORS
EXPRESSLY ACKNOWLEDGE THAT THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS MAY ONLY
BE AMENDED OR MODIFIED, OR THE PROVISIONS HEREOF OR THEREOF WAIVED OR
SUPPLEMENTED, BY AN INSTRUMENT IN WRITING THAT COMPLIES WITH SECTION 12.2. THE
COMPANY AND EACH CREDITOR AGREES THAT THEY WILL NOT RELY ON ANY COURSE OF
DEALING, COURSE OF PERFORMANCE, OR ORAL OR WRITTEN STATEMENTS BY ANY
REPRESENTATIVE OF THE COMPANY OR
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ANY CREDITOR THAT DOES NOT COMPLY WITH SECTION 12.2 TO EFFECT AN AMENDMENT,
MODIFICATION, WAIVER OR SUPPLEMENT TO THE AGREEMENT OF THE OTHER LOAN
DOCUMENTS.
9.22 REPLACEMENT OF A LENDER. Each Lender agrees that if requested by
the Company, it will assign its Note to a willing lender designated by the
Company, and reasonably acceptable to the Administrative Agent, if, within
90 days of such request, that Lender has claimed material compensation pursuant
to Section 3.3 (but only if the impositions referred to therein are not imposed
generally on commercial banks) or if, within 90 days of such request, the
Company has become obligated for any material amount with respect to that Lender
pursuant to Section 3.5(d) or such Lender is unable to make or maintain
Eurodollar Tranches.
9.23 WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY TO THIS AGREEMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH
OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO IN EACH
CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT
OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY TRIAL COURT WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT
[Remainder of this page intentionally left blank]
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OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.
The Company:
GEOLOGISTICS CORPORATION
By:______________________________
Terry Clarke, Vice President
Address:
330 S. Mannheim Road
Hillside, IL 60162
Telecopy: 708/547-2124
Telephone: 708/547-2000
LENDERS:
ING (U.S.) CAPITAL CORPORATION,
individually and as Administrative Agent
By:__________________________________
Michael W. Adler, Managing Director
Address: 333 South Grand Avenue, Suite 4200
Los Angeles, California 90071
Attn.: Michael W. Adler
Managing Director
Telecopy: (213) 346-3991
Telephone: (213) 346-3900
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