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EXHIBIT 10.1
(***) CERTAIN CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT.
REVOLVING/TERM LOAN AGREEMENT
Dated as of June 21, 2001
among
VIASAT, INC.
THE LENDERS HEREIN NAMED
and
UNION BANK OF CALIFORNIA, N.A.,
as Administrative Agent
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TABLE OF CONTENTS
Page
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Article 1. DEFINITIONS AND ACCOUNTING TERMS ................................... 1
1.1 Defined Terms ............................................................ 1
1.2 Use of Defined Terms ..................................................... 29
1.3 Accounting Terms ......................................................... 29
1.4 Rounding ................................................................. 29
1.5 Exhibits and Schedules ................................................... 30
1.6 References to "Borrower and its Subsidiaries" ............................ 30
1.7 Miscellaneous Terms ...................................................... 30
Article 2. LOANS AND LETTERS OF CREDIT ........................................ 31
2.1 Loans-General ............................................................ 31
2.2 Alternate Base Rate Loans ................................................ 32
2.3 Eurodollar Rate Loans .................................................... 33
2.4 Letters of Credit ........................................................ 33
2.5 Voluntary Reduction of Revolving Commitment .............................. 37
2.6 Administrative Agent's Right to Assume Funds Available for Advances ...... 38
2.7 Collateral ............................................................... 38
Article 3. PAYMENTS AND FEES .................................................. 39
3.1 Principal and Interest ................................................... 39
3.2 Arranger and Agency Fees ................................................. 41
3.3 Commitment Fee ........................................................... 41
3.4 Letter of Credit Fees .................................................... 41
3.5 Increased Commitment Costs ............................................... 42
3.6 Eurodollar Costs and Related Matters ..................................... 43
3.7 Late Payments ............................................................ 47
3.8 Computation of Interest and Fees ......................................... 47
3.9 Non-Banking Days ......................................................... 48
3.10 Manner and Treatment of Payments ........................................ 48
3.11 Funding Sources ......................................................... 49
3.12 Failure to Charge Not Subsequent Waiver ................................. 50
3.13 Administrative Agent's Right to Assume Payments Will be Made ............ 50
3.14 Fee Determination Detail ................................................ 50
3.15 Survivability ........................................................... 50
Article 4. REPRESENTATIONS AND WARRANTIES ..................................... 51
4.1 Existence and Qualification; Power; Compliance With Laws ................. 51
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4.2 Authority; Compliance With Other Agreements and Instruments and
Government Regulations ................................................... 51
4.3 No Governmental Approvals Required ....................................... 52
4.4 Subsidiaries ............................................................. 52
4.5 Financial Statements ..................................................... 53
4.6 No Other Liabilities; No Material Adverse Changes ........................ 53
4.7 Intentionally Deleted. ................................................... 54
4.8 Intangible Assets ........................................................ 54
4.9 Public Utility Holding Company Act ....................................... 54
4.10 Litigation .............................................................. 54
4.11 Binding Obligations ..................................................... 54
4.12 No Default .............................................................. 55
4.13 ERISA ................................................................... 55
4.14 Regulation U; Investment Company Act .................................... 55
4.15 Disclosure .............................................................. 55
4.16 Tax Liability ........................................................... 56
4.17 Projections ............................................................. 56
4.18 Hazardous Materials ..................................................... 56
4.19 Security Interests ...................................................... 56
Article 5. AFFIRMATIVE COVENANTS
(OTHER THAN INFORMATION AND REPORTING REQUIREMENTS) ................ 58
5.1 Payment of Taxes and Other Potential Liens ............................... 58
5.2 Preservation of Existence ................................................ 58
5.3 Maintenance of Properties ................................................ 58
5.4 Maintenance of Insurance ................................................. 59
5.5 Compliance With Laws ..................................................... 59
5.6 Inspection Rights ........................................................ 59
5.7 Keeping of Records and Books of Account .................................. 59
5.8 Compliance With Agreements ............................................... 59
5.9 Use of Proceeds .......................................................... 60
5.10 Hazardous Materials Laws ................................................ 60
5.11 Syndication Process ..................................................... 60
Article 6. NEGATIVE COVENANTS ................................................. 61
6.1 Payment of Subordinated Obligations ...................................... 61
6.2 Disposition of Property .................................................. 61
6.3 Mergers .................................................................. 61
6.4 Hostile Acquisitions ..................................................... 62
6.5 Acquisitions ............................................................. 62
6.6 Distributions ............................................................ 62
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6.7 ERISA .................................................................... 62
6.8 Change in Nature of Business ............................................. 62
6.9 Liens .................................................................... 62
6.10 Indebtedness and Guaranty Obligations ................................... 63
6.11 Transactions with Affiliates ............................................ 64
6.12 Leverage Ratio .......................................................... 64
6.13 EBITDA. Permit EBITDA for .............................................. 64
6.14 Tangible Net Worth ...................................................... 64
6.16 Investments ............................................................. 65
6.18 Amendments to Subordinated Obligations .................................. 66
6.19 Changes in Officers, Name, Location of Chief Executive Offices, Etc. .... 66
Article 7. INFORMATION AND REPORTING REQUIREMENTS ............................. 67
7.1 Financial and Business Information ....................................... 67
7.2 Compliance Certificates .................................................. 70
Article 8. CONDITIONS ......................................................... 71
8.1 Initial Credit Issuance. ................................................. 71
8.2 Any Advance. ............................................................. 73
Article 9. EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT ............... 75
9.1 Events of Default ........................................................ 75
9.2 Remedies Upon Event of Default ........................................... 77
Article 10. THE ADMINISTRATIVE AGENT ........................................... 81
10.1 Appointment and Authorization ........................................... 81
10.2 Administrative Agent and Affiliates ..................................... 81
10.3 Proportionate Interest in any Collateral ................................ 81
10.4 Lenders' Credit Decisions ............................................... 82
10.5 Action by Administrative Agent .......................................... 82
10.6 Liability of Administrative Agent ....................................... 83
10.7 Indemnification ......................................................... 84
10.8 Successor Administrative Agent .......................................... 85
10.9 No Obligations of Borrower .............................................. 86
Article 11. MISCELLANEOUS ...................................................... 87
11.1 Cumulative Remedies; No Waiver .......................................... 87
11.2 Amendments; Consents .................................................... 87
11.3 Costs, Expenses and Taxes ............................................... 88
11.4 Nature of Lenders' Obligations .......................................... 89
11.5 Survival of Representations and Warranties .............................. 89
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11.6 Notices ................................................................. 90
11.7 Execution of Loan Documents ............................................. 90
11.8 Binding Effect; Assignment .............................................. 90
11.9 Right of Setoff ......................................................... 93
11.10 Sharing of Setoffs ..................................................... 94
11.11 Indemnity by Borrower .................................................. 94
11.12 Nonliability of the Lenders ............................................ 96
11.13 No Third Parties Benefited ............................................. 97
11.14 Confidentiality ........................................................ 97
11.15 Further Assurances ..................................................... 97
11.16 Integration ............................................................ 98
11.17 Governing Law; JURISDICTION AND VENUE .................................. 98
11.18 Severability of Provisions ............................................. 98
11.19 Headings ............................................................... 99
11.20 Time of the Essence .................................................... 99
11.21 Foreign Lenders and Participants ....................................... 99
11.22 Hazardous Material Indemnity ........................................... 100
11.23 Waiver of Right to Trial by Jury ....................................... 100
11.24 Purported Oral Amendments .............................................. 101
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Exhibits
A - Commitment Assignment and Acceptance
B - Compliance Certificate
C - Opinion of Counsel
D - Pricing Certificate
E - Request for Letter of Credit
F - Request for Loan
G - Revolving Note
H - Security Agreement
I - Subsidiary Guaranty
J - Term Note
K - Investment Policy
Schedules
1.1 Lender Commitments
2.4 Existing Letters of Credit
4.4 Subsidiaries
4.6 Material Adverse Changes
4.8 Trade Names
4.10 Material Litigation
4.18 Hazardous Materials Matters
6.9 Existing Liens
6.10 Existing Indebtedness and Guaranty Obligations
6.17 Existing Investments
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REVOLVING/TERM LOAN AGREEMENT
Dated as of June 21, 2001
THIS REVOLVING/TERM LOAN AGREEMENT (this "Agreement") is entered
into by and among ViaSat, Inc., a Delaware corporation ("Borrower"), each lender
whose name is set forth on the signature pages of this Agreement and each lender
which may hereafter become a party to this Agreement pursuant to Section 11.8
(collectively, the "Lenders" and individually, a "Lender"), and Union Bank of
California, N.A., as Administrative Agent, with reference to the following
facts:
RECITALS
A. Borrower and Union Bank of California, N.A. ("UBOC") are parties
to that certain Loan Agreement dated September 15, 1995, as amended
(collectively, the "Existing Loan Agreement"), pursuant to which UBOC provided
Borrower with various credit facilities (collectively, the "Existing Credit
Facilities").
B. Borrower, the Lenders and the Administrative Agent wish to enter
into this Agreement, pursuant to which the Lenders will provide Borrower with
the Loan described herein, the proceeds of which will be utilized by Borrower in
part to repay its outstanding obligations to UBOC in connection with the
Existing Credit Facilities and in part for Borrower's working capital and
general corporate purposes.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, the parties hereto covenant and agree as follows:
Article 1.
DEFINITIONS AND ACCOUNTING TERMS
1.1 Defined Terms. As used in this Agreement, the following terms
shall have the respective meanings set forth below:
"Acquisition" means any transaction, or any series of related
transactions, consummated after the Closing Date, by which Borrower
and/or any of its Subsidiaries directly or indirectly (a) acquires any
ongoing business or all or substantially all of the assets of any Person
engaged in any ongoing business, whether through a purchase of assets, a
merger or otherwise, (b) acquires control of securities of a Person
engaged in an ongoing business representing more than 50% of the
ordinary voting power for the election of directors or other governing
position if the business affairs of such Person are managed by a
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board of directors or other governing body or (c) acquires control of more than
50% of the ownership interest in any partnership, joint venture, limited
liability company, business trust or other Person engaged in an ongoing business
that is not managed by a board of directors or other governing body.
"Administrative Agent" means Union Bank of California, N.A. when acting
in its capacity as the Administrative Agent under any of the Loan Documents, or
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 hereafter may designate by written notice to Borrower
and the Lenders.
"Advance" means any advance made or to be made by any Lender to Borrower
as provided in Article 2, and includes each Alternate Base Rate Advance and
Eurodollar Rate Advance.
"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 holders of such securities, or 10% or
more of the partnership or other ownership interests of any other Person that
has more than 100 record holders of such interests, will be deemed to be an
Affiliate of such corporation, partnership or other Person.
"Agreement" means this Revolving/Term Loan Agreement, either as
originally executed or as it may from time to time be supplemented, modified,
amended, restated or extended.
"Aggregate Effective Amount" means, as of any date of determination and
with respect to all Letters of Credit then outstanding, the sum of (a) the
aggregate effective face amounts of all such Letters of Credit not then paid by
the Issuing Lender plus (b) the aggregate amounts paid by the Issuing Lender
under such Letters of Credit not then reimbursed to the Issuing Lender by
Borrower pursuant to Section 2.4(d) and not the subject of Advances made
pursuant to Section 2.4(e).
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"Alternate Base Rate" means, as of any date of determination, the rate
per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to the
higher of (a) the Prime Rate in effect on such date and (b) the Federal Funds
Rate in effect on such date plus (***) of (***) basis points).
"(***) Base Rate Advance "means an Advance under the Revolving
Commitment made hereunder and specified to be an Alternate Base Rate Advance in
accordance with Article 2.
"Alternate Base Rate Loan" means a Revolving Loan made hereunder and
specified to be an Alternate Base Rate Loan in accordance with Article 2.
"Applicable Alternate Base Rate Margin" means, for each Pricing Period,
the interest rate margin set forth below (expressed in basis points per annum)
opposite the Applicable Pricing Level for that Pricing Period:
Applicable
Pricing Level Margin
------------- ------
I (***)
II (***)
III (***)
IV (***)
V (***)
"Applicable Commitment Fee Rate" means, for each Pricing Period, the
rate set forth below (expressed in basis points per annum) opposite the
Applicable Pricing Level for that Pricing Period:
Applicable
Pricing Level Margin
------------- ------
I (***)
II (***)
III (***)
IV (***)
V (***)
"Applicable Eurodollar Rate Margin" means, for each Pricing Period, the
interest rate margin set forth below (expressed in basis points per annum)
opposite the Applicable Pricing Level for that Pricing Period:
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Applicable
Pricing Level Margin
------------- ------
I (***)
II (***)
III (***)
IV (***)
V (***)
"Applicable Pricing Level" means, for each Pricing Period, the pricing
level set forth below opposite the Leverage Ratio as of the last day of the
Fiscal Quarter most recently ended prior to the commencement of that Pricing
Period:
Pricing Level Leverage Ratio
------------- --------------
I Less than or equal to (***) to (***)
II Greater than (***) to (***), but less
than or equal to (***) to (***)
III Greater than (***) to (***), but less
than or equal to (***) to (***)
IV Greater than (***) to (***), but less
than or equal to (***) to (***)
V Greater than (***) to (***)
provided that (i) in the event that Borrower does not deliver a Pricing
Certificate with respect to any Pricing Period prior to the commencement of such
Pricing Period, then until such Pricing Certificate is delivered, the Applicable
Pricing Level for that Pricing Period shall be Pricing Level V, but once
Borrower has delivered a Pricing Certificate with respect to such Pricing
Period, then any resulting change in the Applicable Pricing Level shall be made
retroactively to the beginning of such Pricing Period, and (ii) if any Pricing
Certificate is subsequently determined to be in error, then any resulting change
in the Applicable Pricing Level shall be made retroactively to the beginning of
the relevant Pricing Period.
"Arranger" means Union Bank of California, N.A.
"Banking Day" means any Monday, Tuesday, Wednesday, Thursday or Friday,
other than a day on which banks are authorized or required to be closed in
California or New York.
"Capital Expenditure" means any expenditure by Borrower or any of its
Subsidiaries for or related to fixed assets or purchased intangibles that is
treated as a capital expenditure under GAAP, including any amount which is
required to be treated as an asset subject to a
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Capital Lease Obligation. The amount of Capital Expenditures in respect of fixed
assets purchased or constructed by Borrower or any of its Subsidiaries in any
fiscal period shall be net of (a) any net sales proceeds received during such
fiscal period by Borrower or such Subsidiary for fixed assets sold by Borrower
or such Subsidiary and (b) any casualty insurance proceeds received during such
fiscal period by Borrower or such Subsidiary for casualties to fixed assets and
applied to the repair or replacement thereof.
"Capital Lease Obligations" means all monetary obligations of a Person
under any leasing or similar arrangement which, in accordance with GAAP, is
classified as a capital lease.
"Cash" means, when used in connection with any Person, all monetary and
non-monetary items owned by that Person that are treated as cash in accordance
with GAAP, consistently applied.
"Cash Equivalents" means money-market instruments of the type described
in Borrower's Investment Policy, a copy of which is attached hereto as Exhibit
K.
"Cash Income Taxes" means, with respect to any fiscal period, taxes on
or measured by the income of Borrower that are paid or currently payable in Cash
by Borrower during that fiscal period.
"Cash Interest Expense" means Interest Expense that is paid or currently
payable in Cash.
"Certificate" means a certificate signed by a Senior Officer or
Responsible Official (as applicable) of the Person providing the certificate.
"Change in Control" means (a) any transaction or series of related
transactions in which any Unrelated Person or two or more Unrelated Persons
acting in concert acquire beneficial ownership (within the meaning of Rule
13d-3(a)(1) under the Securities Exchange Act of 1934, as amended), directly or
indirectly, of 30% or more of the outstanding Common Stock, (b) Borrower
consolidates with or merges into another Person or conveys, transfers or leases
its properties and assets substantially as an entirety to any Person or any
Person consolidates with or merges into Borrower, in either event pursuant to a
transaction in which the outstanding Common Stock is changed into or exchanged
for cash, securities or other property, with the effect that any Unrelated
Person becomes the beneficial owner, directly or indirectly, of 30% or more of
Common Stock or that the Persons who were the holders of Common Stock
immediately prior to the transaction hold less than 70% of the common stock of
the surviving corporation after the transaction, or (c) during any period of 24
consecutive months, individuals who at the beginning of such period constituted
the
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board of directors of Borrower (together with any new or replacement directors
whose election by the board of directors, or whose nomination for election, was
approved by a vote of at least a majority of the directors then still in office
who were either directors at the beginning of such period or whose election or
nomination for reelection was previously so approved) cease for any reason to
constitute a majority of the directors then in office. For purposes of the
foregoing, the term "Unrelated Person" means any Person other than (i) a
Subsidiary of Borrower or (ii) an employee stock ownership plan or other
employee benefit plan covering the employees of Borrower and its Subsidiaries.
"Closing Date" means the time and Banking Day on which the conditions
set forth in Section 8.1 are satisfied or waived. The Administrative Agent shall
notify Borrower and the Lenders of the date that is the Closing Date.
"Code" means the Internal Revenue Code of 1986, as amended or replaced
and as in effect from time to time.
"Collateral" means all of the collateral covered by the Security
Agreement.
"Commercial Letter of Credit" means each Letter of Credit issued to
support the purchase of goods by Borrower which is determined to be a commercial
letter of credit by the Issuing Lender.
"Commitments" means, collectively, the Revolving Commitment and the Term
Commitment.
"Commitment Assignment and Acceptance" means a commitment assignment and
acceptance substantially in the form of Exhibit A.
"Common Stock" means the common stock of Borrower or its successor.
"Compliance Certificate" means a certificate in the form of Exhibit B,
properly completed and signed by a Senior Officer of Borrower.
"Contractual Obligation" means, as to any Person, any provision of any
outstanding security 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.
"Credit Issuance" means the making of an Advance or the issuance of a
Letter of Credit.
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"Debtor Relief Laws" means the Bankruptcy Code of the United States of
America, as amended from time to time, and all other applicable liquidation,
conservatorship, bankruptcy, moratorium, rearrangement, receivership,
insolvency, reorganization, or similar debtor relief 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 9.1, or both, would be an Event of
Default.
"Default Rate" means the sum of (a) any incremental interest rate then
in effect pursuant to Section 3.1(d) plus (b) the interest rate prescribed in
Section 3.7.
"Designated Deposit Account" means a deposit account to be maintained by
Borrower with Union Bank of California, N.A. or one of its Affiliates, as from
time to time designated by Borrower by written notification to the
Administrative Agent.
"Designated Eurodollar Market" means, with respect to any Eurodollar
Rate Loan, the London Eurodollar Market.
"Disqualified Stock" means any capital stock, warrants, options or other
rights to acquire capital stock (but excluding any debt security which is
convertible, or exchangeable, for 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, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of the holder thereof, in whole or in part, on or prior to the
Revolving Loan Maturity Date.
"Disposition" means the sale, transfer or other disposition in any
single transaction or series of related transactions of any asset, or group of
related assets, of Borrower or any of its Subsidiaries (a) which asset or assets
constitute a line of business or substantially all the assets of Borrower or the
Subsidiary or (b) the aggregate amount of the Net Cash Sales Proceeds of such
assets is more than $500,000, other than (i) inventory or other assets sold or
otherwise disposed of in the ordinary course of business of Borrower or its
Subsidiary or normal in the industry, (ii) equipment sold or otherwise disposed
of where substantially similar equipment in replacement thereof has theretofore
been acquired, or thereafter within 90 days is acquired, by Borrower or its
Subsidiary and (iii) assets no longer useful in the business of Borrower and its
Subsidiaries.
"Distribution" means, with respect to any shares of capital stock or any
warrant or option to purchase an equity security or other equity security issued
by a Person, (a) the retirement, redemption, purchase or other acquisition for
Cash or for Property by such Person of any such security, (b) the declaration or
(without duplication) payment by such
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Person of any dividend in Cash or in Property on or with respect to any such
security, (c) any Investment by such Person in the holder of 5% or more of any
such security if a purpose of such Investment is to avoid characterization of
the transaction as a Distribution and (d) any other payment in Cash or Property
by such Person constituting a distribution under applicable Laws with respect to
such security.
"Dollars" or "$" means United States of America dollars.
"EBITDA" means, with respect to any fiscal period and with respect to
Borrower and its Subsidiaries on a consolidated basis, the sum of (a) net profit
after tax, minus (b) interest income, plus (c) income taxes accrued, whether or
not paid for such fiscal period, plus (d) Interest Expense for such fiscal
period, plus (e) depreciation, plus (f) amortization, plus (g) to the extent
included in such fiscal period, non-recurring acquisition costs associated with
Permitted Acquisitions, all as determined on a trailing twelve-month basis in
accordance with GAAP; provided, however, write-offs, in an aggregate amount not
exceeding (***) of accounts receivable or other amounts due to Borrower or its
Affiliates from (***) or its Affiliates shall not be deducted from EBITDA.
"Eligible Assignee" means (a) another Lender, (b) with respect to any
Lender, any Affiliate of that Lender, (c) any commercial bank having total
assets of $1,000,000,000 or more, (d) any (i) savings bank, savings and loan
association or similar financial institution or (ii) insurance company engaged
in the business of writing insurance which, in either case (A) has total assets
of $1,000,000,000 or more, (B) is engaged in the business of lending money and
extending credit under credit facilities substantially similar to those extended
under this Agreement and (C) is operationally and procedurally able to meet the
obligations of a Lender hereunder to the same degree as a commercial bank and
(e) any other financial institution (including a mutual fund or other fund)
having total assets of $1,000,000,000 or more which meets the requirements set
forth in subclauses (B) and (C) of clause (d) above; provided that each Eligible
Assignee must either (aa) be organized under the Laws of the United States of
America, any State thereof or the District of Columbia or be organized under the
Laws of the Cayman Islands or any country which is a member of the Organization
for Economic Cooperation and Development, or a political subdivision of such a
country, and (i) act hereunder through a branch, agency or funding office
located in the United States of America and (ii) be exempt from withholding of
tax on interest and deliver the documents related thereto pursuant to Section
11.21.
"ERISA" means the Employee Retirement Income Security Act of 1974, and
any regulations or rulings issued pursuant thereto, as amended or replaced and
as in effect from time to time.
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"ERISA Affiliate" means each Person (whether or not incorporated) which
is required to be aggregated with Borrower pursuant to Section 414 of the Code.
"Eurodollar Banking Day" means any Banking Day on which dealings in
Dollar deposits are conducted by and among banks in the Designated Eurodollar
Market.
"Eurodollar Lending Office" means, as to each Lender, its office or
branch so designated by written notice to Borrower and the Administrative Agent
as its Eurodollar Lending Office. If no Eurodollar Lending Office is designated
by a Lender, its Eurodollar Lending Office shall be its office at its address
for purposes of notices hereunder.
"Eurodollar Market" means a regular established market located outside
the United States of America by and among banks for the solicitation, offer and
acceptance of Dollar deposits in such banks.
"Eurodollar Obligations" means eurocurrency liabilities, as defined in
Regulation D or any comparable regulation of any Governmental Agency having
jurisdiction over any Lender.
"Eurodollar Period" means, as to each Eurodollar Rate Loan, the period
commencing on the date specified by Borrower pursuant to Section 2.1(c) and
ending 1, 2, 3, 6, 9 or 12 months (or, with the written consent of all of the
Lenders, any other period) thereafter, as specified by Borrower in the
applicable Request for Loan; provided that:
(a) The first day of any Eurodollar Period shall be a Eurodollar
Banking Day;
(b) Any Eurodollar Period that would otherwise end on a day that
is not a Eurodollar Banking Day shall be extended to the immediately
succeeding Eurodollar Banking Day unless such Eurodollar Banking Day
falls in another calendar month, in which case such Eurodollar Period
shall end on the immediately preceding Eurodollar Banking Day;
(c) Borrower may not specify a Eurodollar Period with respect to
a Term Loan that extends beyond the next scheduled principal payment
date unless the aggregate principal amount of the Eurodollar Loans that
are Term Loans having a Eurodollar Period ending after such payment date
does not exceed the aggregate outstanding amount of Term Loans (after
giving effect to the principal amount to be paid on such payment date);
and
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(d) No Eurodollar Period shall extend beyond the Revolving Loan
Maturity Date.
"Eurodollar Rate" means, with respect to any Eurodollar Rate Loan, the
average of the interest rates per annum (rounded upward, if necessary, to the
next 1/16 of 1%) at which deposits in Dollars are offered to the Administrative
Agent in the Designated Eurodollar Market at or about 11:00 a.m. local time in
the Designated Eurodollar Market, two (2) Eurodollar Banking Days before the
first day of the applicable Eurodollar Period in an aggregate amount
approximately equal to the amount of the Advance to be made by the
Administrative Agent with respect to such Eurodollar Rate Loan and for a period
of time comparable to the number of days in the applicable Eurodollar Period.
"Eurodollar Rate Advance" means an Advance made hereunder and specified
to be a Eurodollar Rate Advance in accordance with Article 2.
"Eurodollar Rate Loan" means a Loan made hereunder and specified to be a
Eurodollar Rate Loan in accordance with Article 2.
"Event of Default" shall have the meaning provided in Section 9.1.
"Existing Credit Facilities" shall have the meaning provided in the
recitals to this Agreement.
"Existing Letters of Credit" means the letters of credit, if any,
outstanding on the Closing Date and listed on Schedule 2.4.
"Existing Loan Agreement" shall have the meaning provided in the
recitals to this Agreement.
"Federal Funds Rate" means, as of any date of determination, the rate
set forth in the weekly statistical release designated as H.15(519), or any
successor publication, published by the Federal Reserve Board (including any
such successor, "H.15(519)") for such date opposite the caption "Federal Funds
(Effective)". If for any relevant date such rate is not yet published in
H.15(519), the rate for such date will be the rate set forth in the daily
statistical release designated as the Composite 3:30 p.m. Quotations for U.S.
Government Securities, or any successor publication, published by the Federal
Reserve Lender of New York (including any such successor, the "Composite 3:30
p.m. Quotation") for such date under the caption "Federal Funds Effective Rate".
If on any relevant date the appropriate rate for such date is not yet published
in either H.15(519) or the Composite 3:30 p.m. Quotations, the rate for such
date will be the arithmetic mean of the rates for the last transaction in
overnight Federal funds arranged prior to 9:00 a.m. (New York City time) on that
date by
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17
each of three leading brokers of Federal funds transactions in New York City
selected by the Administrative Agent. For purposes of this Agreement, any change
in the Alternate Base Rate due to a change in the Federal Funds Rate shall be
effective as of the opening of business on the effective date of such change.
"Fiscal Quarter" means the fiscal quarter of Borrower ending on each
June 30, September 30, December 31 and March 31.
"Fiscal Year" means the fiscal year of Borrower ending on each March 31.
"Foreign Subsidiary" means a Subsidiary of Borrower that (a) is
organized under the Laws of a country (or political subdivision thereof) other
than the United States of America and (b) holds all or substantially all of its
assets outside the United States of America.
"GAAP" means, as of any date of determination, accounting principles (a)
set forth as generally accepted in then currently effective Opinions of the
Accounting Principles Board of the American Institute of Certified Public
Accountants, (b) set forth as generally accepted in then currently effective
Statements of the Financial Accounting Standards Board or (c) that are then
approved by such other entity as may be approved by a significant segment of the
accounting profession in the United States of America. The term "consistently
applied," as used in connection therewith, means that the accounting principles
applied are consistent in all material respects with those applied at prior
dates or for prior periods.
"Government Securities" means readily marketable (a) direct full faith
and credit obligations of the United States of America or obligations guaranteed
by the full faith and credit of the United States of America and (b) obligations
of an agency or instrumentality of, or corporation owned, controlled or
sponsored by, the United States of America that are generally considered in the
securities industry to be implicit obligations of the United States of America.
"Governmental Agency" means (a) any international, foreign, federal,
state, county or municipal government, or political subdivision thereof, (b) any
governmental or quasi-governmental agency, authority, board, bureau, commission,
department, instrumentality or public body or (c) any court or administrative
tribunal of competent jurisdiction.
"Guaranty Obligation" means, as to any Person, any (a) guarantee by that
Person of Indebtedness of, or other obligation performable by, any other Person
or (b) assurance given by that Person to an obligee of any other Person with
respect to the performance of an obligation by, or the financial condition of,
such other Person, whether direct, indirect or contingent, including any
purchase or repurchase agreement covering such obligation or any
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18
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 of such other Person or
any "keep-well" or other arrangement of whatever nature given for the purpose of
assuring or holding harmless such obligee against loss with respect to any
obligation of such other Person; provided, however, that the term Guaranty
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Guaranty
Obligation in respect of Indebtedness shall be deemed to be an amount equal to
the stated or determinable amount of the related Indebtedness (unless the
Guaranty 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 Guaranty Obligation shall be deemed to be
zero unless and until the amount thereof has been (or in accordance with
Financial Accounting Standards Board Statement No. 5 should be) quantified and
reflected or disclosed in the consolidated financial statements (or notes
thereto) of Borrower.
"Hazardous Materials" means substances defined as "hazardous substances"
pursuant to the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, 42 U.S.C. Section 9601 et seq., or as "hazardous", "toxic" or
"pollutant" substances or as "solid waste" pursuant to the Hazardous Materials
Transportation Act, 49 U.S.C. Section 1801, et seq., the Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901, et seq., or as "friable asbestos"
pursuant to the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq. or
any other applicable Hazardous Materials Law, in each case as such Laws are
amended from time to time.
"Hazardous Materials Laws" means all Laws governing the treatment,
transportation or disposal of Hazardous Materials applicable to any of the Real
Property.
"Indebtedness" means, as to any Person (without duplication), (a)
indebtedness of such Person for borrowed money or for the deferred purchase
price of Property (excluding trade and other accounts payable in the ordinary
course of business in accordance with ordinary trade terms), including any
Guaranty Obligation for any such indebtedness, (b) indebtedness of such Person
of the nature described in clause (a) that is non-recourse to the credit of such
Person but is secured by assets of such Person, to the extent of the fair market
value of such assets as determined in good faith by such Person, (c) Capital
Lease Obligations of such Person, (d) indebtedness of such Person arising under
bankers' acceptance facilities, (e) any direct or contingent obligations of such
Person under letters of credit issued for the account of such Person and (f) any
net obligations of such Person under Interest Rate Protection Agreements.
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19
"Intangible Assets" means assets that are considered intangible assets
under GAAP, including customer lists, goodwill, covenants not to compete,
copyrights, trade names, trademarks, licenses and patents.
"Interest Expense" means, with respect to any Person and as of the last
day of any fiscal period, the sum of (a) all interest, fees, charges and related
expenses (in each case as such expenses are calculated according to GAAP) paid
or payable (without duplication) for that fiscal period by that Person to a
lender in connection with borrowed money (including any obligations for fees,
charges and related expenses payable to the issuer of any letter of credit) or
the deferred purchase price of assets that are considered "interest expense"
under GAAP plus (b) the portion of rent paid or payable (without duplication)
for that fiscal period by that Person under Capital Lease Obligations that
should be treated as interest in accordance with Financial Accounting Standards
Board Statement No. 13.
"Interest Rate Protection Agreement" means a written agreement between
Borrower and one or more financial institutions providing for "swap", "cap",
"collar" or other interest rate protection with respect to any Indebtedness.
"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 stock or other securities of any other Person or by means of a
loan, advance creating a debt, capital contribution, guaranty or other debt or
equity participation or interest in any other Person, including any partnership
and joint venture interests of such Person. The amount of any Investment shall
be the amount actually invested (minus any return of capital with respect to
such Investment which has actually been received in Cash or has been converted
into Cash), without adjustment for subsequent increases or decreases in the
value of such Investment.
"Issuing Lender" means Union Bank of California, N.A.
"Joint Venture" means any Investment by Borrower in any Person that is
not a Wholly-Owned Subsidiary of Borrower, which Person is engaged in the same
or a similar line of business as Borrower.
"Laws" means, collectively, all international, foreign, federal, state
and local statutes, treaties, rules, regulations, ordinances, codes and
administrative or judicial precedents.
"Lender" means each lender whose name is set forth in the signature
pages of this Agreement and each lender which may hereafter become a party to
this Agreement pursuant to Section 11.8.
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20
"Letters of Credit" means (a) the Existing Letters of Credit and (b) any
of the Commercial Letters of Credit or Standby Letters of Credit issued by the
Issuing Lender under the Revolving Commitment pursuant to Section 2.4, either as
originally issued or as the same may be supplemented, modified, amended,
renewed, extended or supplanted.
"Leverage Ratio" means, as of the last day of any Fiscal Quarter, the
ratio of (a) all Indebtedness of Borrower and its Subsidiaries on that date to
(b) EBITDA for the fiscal period consisting of the four (4) Fiscal Quarters
ended on that date.
"Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment for security, security interest, encumbrance, lien or charge of any
kind, whether voluntarily incurred or arising by operation of Law or otherwise,
affecting any Property, including any conditional sale or other title retention
agreement, any lease in the nature of a security interest, and/or the filing of
any financing statement (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 or comparable Law of any jurisdiction with respect to
any Property.
"Loan" means, as the context may require, the amount of a particular
Advance made or to be made, or the aggregate of the Advances made at any one
time by the Lenders pursuant to Section 2.1.
"Loan Documents" means, collectively, this Agreement, the Notes, the
Subsidiary Guaranty, the Security Agreement, and any other agreements of any
type or nature hereafter executed and delivered by Borrower or any of the
Subsidiary Guarantors to the Administrative Agent or to any Lender in any way
relating to or in furtherance of this Agreement, in each case either as
originally executed or as the same may from time to time be supplemented,
modified, amended, restated, extended or supplanted.
"Margin Stock" means "margin stock" as such term is defined in
Regulation U.
"Material Adverse Effect" means any set of circumstances or events which
(a) has had or could reasonably be expected to have any material adverse effect
whatsoever upon the validity or enforceability of any Loan Document, (b) has
been or could reasonably be expected to be material and adverse to the business
or condition (financial or otherwise) of Borrower and its Subsidiaries, taken as
a whole or (c) has materially impaired or could reasonably be expected to
materially impair the ability of Borrower to perform the Obligations.
"Monthly Payment Date" means the first day of each calendar month.
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21
"Multiemployer Plan" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA to which Borrower or any of its ERISA
Affiliates contributes or is obligated to contribute.
"Net Cash Issuance Proceeds" means, with respect to the issuance of any
debt security or equity security by Borrower or any of its Subsidiaries, the
Cash proceeds received by or for the account of Borrower or such Subsidiary in
consideration of such issuance net of (a) underwriting discounts and commissions
actually paid to any Person not an Affiliate of Borrower and (b) professional
fees and disbursements actually paid in connection therewith.
"Net Cash Sales Proceeds" means, with respect to any Disposition, the
sum of (a) the Cash proceeds received by or for the account of Borrower and its
Subsidiaries from such Disposition plus (b) the amount of Cash received by or
for the account of Borrower and its Subsidiaries upon the sale, collection or
other liquidation of any proceeds that are not Cash from such Disposition, in
each case net of (i) any amount required to be paid to any Person owning an
interest in the assets disposed of, (ii) any amount applied to the repayment of
Indebtedness secured by a Lien permitted under Section 6.9 on the asset disposed
of, (iii) any transfer, income or other taxes payable as a result of such
Disposition, (iv) professional fees and expenses, fees due to any Governmental
Agency, broker's commissions and other out-of-pocket costs of sale actually paid
to any Person that is not an Affiliate of Borrower attributable to such
Disposition and (v) any reserves established in accordance with GAAP in
connection with such Disposition.
"Net Income" means, with respect to any fiscal period, the consolidated
net income of Borrower and its Subsidiaries for that period, determined in
accordance with GAAP, consistently applied.
"Note" means any of the Revolving Notes or the Term Notes, and "Notes"
means, collectively, the Revolving Notes and the Term Notes.
"Obligations" means all present and future obligations of every kind or
nature of Borrower or any of the Subsidiary Guarantors at any time and from time
to time owed to the Administrative Agent or the Lenders 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
payment, and including interest that accrues after the commencement of any
proceeding under any Debtor Relief Law by or against Borrower or any of the
Subsidiary Guarantors.
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"Opinion of Counsel" means the favorable written legal opinion of
counsel to Borrower, substantially in the form of Exhibit C, together with
copies of factual certificates and legal opinions, if any, delivered to such
counsel in connection with such opinion upon which such counsel has relied.
"Party" means any Person other than the Administrative Agent and the
Lenders, which 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" (as such term
is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, which is
subject to Title IV of ERISA and is maintained by Borrower or to which Borrower
contributes or has an obligation to contribute.
"Permitted Acquisition" means any Acquisition by Borrower or any
Subsidiary of Borrower (as applicable, the "acquiror") of another Person engaged
in the same or a similar line of business as that of the acquiror (the
"target"), provided that: (i) no Default or Event of Default shall exist at the
time of such Acquisition or occur after giving effect to such Acquisition; (ii)
such Acquisition shall have been approved by the board of directors of the
target; (iii) the pro-forma balance sheets and combining projections (including
pro-forma financial covenant ratios) provided by Borrower to the Administrative
Agent shall have demonstrated that, after giving effect to such Acquisition, (A)
Borrower would have been in compliance with the financial covenants set forth in
Sections 6.12, 6.13, 6.14 and 6.15 of this Agreement throughout the period of
the four (4) Fiscal Quarters most recently ended prior to the date of such
Acquisition (or such shorter period in which the target has been in existence)
and (B) Borrower would remain in compliance with such financial covenants for
the period of four (4) Fiscal Quarters immediately following the date of such
Acquisition; (iv) Borrower shall have borrowing availability under its Revolving
Loan or cash on hand of at least (***) after giving effect to such Acquisition;
(v) the terms and conditions of any and all seller purchase-money financing
provided to the acquiror in connection with such Acquisition shall be acceptable
to the Administrative Agent and the Lenders in their reasonable discretion; and
(vi) Borrower shall use commercially reasonable efforts to provide the
Administrative Agent with at least one (1) week prior written notice of such
Acquisition, together with at least one (1) year (or such shorter period in
which the target has been in existence) of historical financial information
relating to the target and such other documentation pertaining to the
Acquisition, including pro-forma quarterly projections, as the Administrative
Agent may reasonably request.
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"Permitted Encumbrances" means:
(a) inchoate Liens incident to construction on or maintenance of
Property; or Liens incident to construction on or maintenance of Property now or
hereafter filed of record for which adequate reserves have been set aside (or
deposits made pursuant to applicable Law) and which are being contested in good
faith by appropriate proceedings and have not proceeded to judgment, provided
that, by reason of nonpayment of the obligations secured by such Liens, no such
Property is subject to a material impending risk of loss or forfeiture;
(b) Liens for taxes and assessments on Property which are not yet
past due; or Liens for taxes and assessments on Property for which adequate
reserves have been set aside and are being contested in good faith by
appropriate proceedings and have not proceeded to judgment, provided that, by
reason of nonpayment of the obligations secured by such Liens, no such Property
is subject to a material impending risk of loss or forfeiture;
(c) defects and irregularities in title to any Property which in the
aggregate do not materially impair the fair market value or use of the Property
for the purposes for which it is or may reasonably be expected to be held;
(d) easements, exceptions, reservations, or other agreements for the
purpose of pipelines, conduits, cables, wire communication lines, power lines
and substations, streets, trails, walkways, drainage, irrigation, water, and
sewerage purposes, dikes, canals, ditches, the removal of oil, gas, coal, or
other minerals, and other like purposes affecting Property which in the
aggregate do not materially burden or impair the fair market value or use of
such Property for the purposes for which it is or may reasonably be expected to
be held;
(e) easements, exceptions, reservations, or other agreements for the
purpose of facilitating the joint or common use of Property in or adjacent to a
shopping center or similar project affecting Property which in the aggregate do
not materially burden or impair the fair market value or use of such Property
for the purposes for which it is or may reasonably be expected to be held;
(f) rights reserved to or vested in any Governmental Agency to
control or regulate, or obligations or duties to any Governmental Agency with
respect to, the use of any Property;
(g) rights reserved to or vested in any Governmental Agency to
control or regulate, or obligations or duties to any Governmental Agency with
respect to, any right, power, franchise, grant, license, or permit;
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(h) present or future zoning laws and ordinances or other laws and
ordinances restricting the occupancy, use, or enjoyment of Property;
(i) statutory Liens, other than those described in clauses (a) or
(b) above, arising in the ordinary course of business with respect to
obligations which are not delinquent or are being contested in good faith,
provided that, if delinquent, adequate reserves have been set aside with respect
thereto and, by reason of nonpayment, no Property is subject to a material
impending risk of loss or forfeiture;
(j) covenants, conditions, and restrictions affecting the use of
Property which in the aggregate do not materially impair the fair market value
or use of the Property for the purposes for which it is or may reasonably be
expected to be held;
(k) rights of tenants under leases and rental agreements covering
Property entered into in the ordinary course of business of the Person owning
such Property;
(l) Liens consisting of pledges or deposits to secure obligations
under workers' compensation laws or similar legislation, including Liens of
judgments thereunder which are not currently dischargeable;
(m) Liens consisting of pledges or deposits of Property to secure
performance in connection with operating leases made in the ordinary course of
business;
(n) Liens consisting of deposits of Property to secure bids made
with respect to, or performance of, contracts (other than contracts creating or
evidencing an extension of credit to the depositor);
(o) Liens consisting of any right of offset, or statutory bankers'
lien, on bank deposit accounts maintained in the ordinary course of business so
long as such bank deposit accounts are not established or maintained for the
purpose of providing such right of offset or bankers' lien;
(p) Liens consisting of deposits of Property to secure statutory
obligations of Borrower;
(q) Liens consisting of deposits of Property to secure (or in lieu
of) surety, appeal or customs bonds;
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(r) Liens created by or resulting from any litigation or legal
proceeding in the ordinary course of business which is currently being contested
in good faith by appropriate proceedings, provided that, adequate reserves have
been set aside and no material Property is subject to a material impending risk
of loss or forfeiture;
(s) Liens created to secure the purchase price of property or
assets; provided, that (a) any such Lien shall attach only to the property or
assets purchased, (b) the Indebtedness secured by any such Lien shall not exceed
one hundred percent (100%) of the purchase price of the property or assets
purchased, (c) any such Lien shall be created within twelve (12) months
following the acquisition of such property or assets, and (d) the principal
amount of Indebtedness secured by such Liens does not exceed $3,000,000 in the
aggregate at any time; and
(t) other non-consensual Liens incurred in the ordinary course of
business but not in connection with the incurrence of any Indebtedness, which do
not in the aggregate, when taken together with all other Liens, materially
impair the fair market value or use of the Property for the purposes for which
it is or may reasonably be expected to be held.
"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 fair
market 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 Encumbrance, (c) the subordination of a lease or sublease
in favor of a financing entity and (d) a license, or similar right, of or to
Intangible Assets granted in the ordinary course of business.
"Person" means any individual or entity, including a trustee,
corporation, limited liability company, general partnership, limited
partnership, joint stock company, trust, estate, unincorporated organization,
business association, firm, joint venture, Governmental Agency, or other entity.
"Pricing Certificate" means a certificate in the form of Exhibit D,
properly completed and signed by a Senior Officer of Borrower.
"Pricing Period" means (a) the period commencing on the Closing Date and
ending on February 15, May 15, August 15, or November 15, whichever first
occurs, (b) the period commencing on each February 15 and ending on the next
following May 15, (c) the period commencing on each May 16 and ending on the
next following August 15, (d) the period commencing on each August 16 and ending
on the next following November 15, and
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(e) the period commencing on each November 16 and ending on the next following
February 15.
"Prime Rate" means the rate of interest publicly announced from time to
time by the Administrative Agent in San Francisco, California (or other
headquarters city of the Administrative Agent), as its "reference rate." The
"reference rate" is one of several base rates used by the Administrative Agent
and serves as the basis upon which effective rates of interest are calculated
for loans and other credits making reference thereto. The "reference rate" is
not necessarily the lowest base interest rate used by the Administrative Agent.
The "reference rate" is evidenced by the recording thereof after its
announcement in such internal publication or publications as the Administrative
Agent may designate. Any change in the Prime Rate announced by the
Administrative Agent shall take effect at the opening of business on the day
specified in the public announcement of such change.
"Projections" means the projected financial information to be prepared
by Borrower and furnished to the Lenders hereunder.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Pro Rata Share" means, with respect to each Lender, the percentage of
the Revolving Commitment and Term Commitment set forth opposite the name of that
Lender on Schedule 1.1, as such percentage may be increased or decreased
pursuant to a Commitment Assignment and Acceptance executed in accordance with
Section 11.8.
"Quarterly Payment Date" means each April 1, July 1, October 1 and
January 1, commencing with July 1, 2001.
"Quick Ratio" means, as of the last day of any Fiscal Quarter, in
respect of Borrower and its Subsidiaries on a consolidated basis and determined
in accordance with GAAP, the ratio of (a) the sum of (i) Cash and Cash
Equivalents, (ii) accounts receivable other than those owed to Borrower by
account debtors involved in proceedings under a Debtor Relief Law and (iii)
marketable securities to (b) current liabilities, including the aggregate
outstanding principal balance of, and all accrued and unpaid interest on, the
Revolving Loans.
"Real Property" means, as of any date of determination, all real
property then or theretofore owned, leased or occupied by any of Borrower or its
Subsidiaries.
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"Regulation D" means Regulation D, as at any time amended, of the Board
of Governors of the Federal Reserve System, or any other regulation in substance
substituted therefor.
"Regulation U" means Regulation U, as at any time amended, of the Board
of Governors of the Federal Reserve System, or any other regulation in substance
substituted therefor.
"Request for Letter of Credit" means a written request for a Letter of
Credit substantially in the form of Exhibit E, signed by a Responsible Official
of Borrower and properly completed to provide all information required to be
included therein.
"Request for Loan" means a written request for a Loan substantially in
the form of Exhibit F, signed by a Responsible Official of Borrower, on behalf
of Borrower, and properly completed to provide all information required to be
included therein.
"Requirement of Law" means, as to any Person, the articles or
certificate of incorporation and by-laws 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.
"Requisite Lenders" means (a) as of any date of determination if the
Commitments are then in effect, Lenders having in the aggregate 60% or more of
the Commitments then in effect and (b) as of any date of determination if the
Commitments have then been suspended or terminated and there is then any
Indebtedness evidenced by the Notes, Lenders holding Notes evidencing in the
aggregate 60% or more of the aggregate Indebtedness then evidenced by the Notes,
and, in any event, not less than two (2) Lenders (unless there shall then be but
one Lender).
"Responsible Official" means (a) any Senior Officer of Borrower and (b)
any other responsible official of Borrower so designated in a written notice
thereof from a Senior Officer to the Administrative Agent. The Lenders shall be
entitled to conclusively rely upon any document or certificate that is signed or
executed by a Responsible Official of Borrower or any of its Subsidiaries as
having been authorized by all necessary corporate, partnership and/or other
action on the part of Borrower or such Subsidiary.
"Revolving Commitment" means, subject to Section 2.5, $25,000,000. The
respective Pro Rata Shares of the Lenders with respect to the Revolving
Commitment are set forth in Schedule 1.1.
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"Revolving Loan" means a Loan made under the Revolving Commitment.
"Revolving Loan Maturity Date" means April 30, 2002.
"Revolving Note" means any of the promissory notes made by Borrower to a
Lender evidencing Advances under that Lender's Pro Rata Share of the Revolving
Commitment, substantially in the form of Exhibit G, either as originally
executed or as the same may from time to time be supplemented, modified,
amended, renewed, extended or supplanted.
"Right of Others" means, as to any Property in which a Person has an
interest, any legal or equitable right, title or other interest (other than a
Lien) held by any other Person in that Property, and any option or right held by
any other Person to acquire any such right, title or other interest in that
Property, including any option or right to acquire a Lien; provided, however,
that (a) no covenant restricting the use or disposition of Property of such
Person contained in any Contractual Obligation of such Person and (b) no
provision contained in a contract creating a right of payment or performance in
favor of a Person that conditions, limits, restricts, diminishes, transfers or
terminates such right shall be deemed to constitute a Right of Others.
"Security Agreement" means the security agreement to be executed and
delivered pursuant to Article 8 by Borrower and the Subsidiary Guarantors, in
the form of Exhibit H, either as originally executed or as it may from time to
time be supplemented, modified, amended, extended or supplanted.
"Senior Officer" means (a) the chief executive officer, (b) the
president, (c) any executive vice president, (d) the chief financial officer or
(e) the treasurer, in each case of Borrower.
"Significant Domestic Subsidiary" means a Significant Subsidiary that is
not a Foreign Subsidiary.
"Significant Foreign Subsidiary" means a Foreign Subsidiary that is a
Significant Subsidiary.
"Significant Subsidiary" means a Subsidiary that either (i) had net
income for the Fiscal Year then most recently ended in excess of 5% of Net
Income for such Fiscal Year or (ii) had assets in excess of 5% of the total
assets of Borrower and its Subsidiaries on a consolidated basis as at the end of
the Fiscal Year then most recently ended.
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"Special Eurodollar Circumstance" means the application or adoption
after the Closing Date of any Law or interpretation, or any change therein or
thereof, or any change in the interpretation or administration thereof by any
Governmental Agency, central bank or comparable authority charged with the
interpretation or administration thereof, or compliance by any Lender or its
Eurodollar Lending Office with any request or directive (whether or not having
the force of Law) of any such Governmental Agency, central bank or comparable
authority.
"Standby Letter of Credit" means each Letter of Credit issued by the
Issuing Lender under the Revolving Commitment pursuant to Section 2.4 to support
the payment or performance of an obligation by Borrower.
"Stockholders' Equity" means, as of any date of determination and with
respect to any Person, the consolidated stockholders' equity of the Person as of
that date determined in accordance with GAAP; provided that there shall be
excluded from Stockholders' Equity any amount attributable to Disqualified
Stock.
"Subordinated Obligations" means any Indebtedness of Borrower that (a)
does not have any scheduled principal payment, mandatory principal prepayment or
sinking fund payment due prior to the date that is one year after the Revolving
Loan Maturity Date, (b) is not secured by any Lien on any Property of Borrower
or any of its Subsidiaries, (c) is not guarantied by any Subsidiary of Borrower,
(d) is subordinated by its terms in right of payment to the Obligations pursuant
to provisions acceptable to the Requisite Lenders, (e) is subject to such
financial and other covenants and events of defaults as may be acceptable to the
Requisite Lenders and (f) is subject to customary interest blockage and delayed
acceleration provisions as may be acceptable to the Requisite Lenders.
"Subsidiary" means, as of any date of determination and with respect to
any Person, any corporation, limited liability company or partnership (whether
or not, in any case, characterized as such or as a "joint venture"), whether now
existing or hereafter organized or acquired: (a) in the case of a corporation or
limited liability company, 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 or more
Subsidiaries of such Person, or (b) in the case of a partnership, 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.
Notwithstanding the foregoing, the terms, provisions and limitations of this
Agreement (including the representations and warranties set forth in Article IV
and the covenants set forth in Article V and VI) shall not apply to either (i)
Immeon Networks LLC, a Delaware limited liability company, or (ii) Trellisware
Technologies, Inc., a Delaware corporation.
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"Subsidiary Guarantors" means all Significant Domestic Subsidiaries.
"Subsidiary Guaranty" means the continuing guaranty of the Obligations
to be executed and delivered pursuant to Article 8 by the Subsidiary Guarantors,
in the form of Exhibit I, either as originally executed or as it may from time
to time be supplemented, modified, amended, extended or supplanted.
"Tangible Net Worth" means, as of any date of determination, the
difference between (a) the sum of (i) Stockholders' Equity of Borrower and its
Subsidiaries on such date and (ii) Subordinated Obligations outstanding on such
date, and (b) the sum of (i) all Intangible Assets of Borrower and its
Subsidiaries on such date, (ii) organizational expenses and (iii) monies due
from Affiliates (including officers, shareholders and directors) of Borrower and
its Subsidiaries on such date.
"Term Commitment" means $168,042.09. The respective Pro Rata Shares of
the Lenders with respect to the Term Commitment are set forth in Schedule 1.1.
"Term Loan" means the Loan made under the Term Commitment.
"Term Loan Maturity Date" means September 15, 2001.
"Term Note" means any of the promissory notes made by Borrower to a
Lender evidencing Advances under that Lender's Pro Rata Share of the Term
Commitment, substantially in the form of Exhibit J, either as originally
executed or as the same may from time to time be supplemented, modified,
amended, renewed, extended or supplanted.
"to the best knowledge of" means, when modifying a representation,
warranty or other statement of any Person, that the fact or situation described
therein is known by the Person (or, in the case of a Person other than a natural
Person, known by a Responsible Official of that Person) making the
representation, warranty or other statement, or with the exercise of reasonable
due diligence under the circumstances (in accordance with the standard of what a
reasonable Person in similar circumstances would have done) would have been
known by the Person (or, in the case of a Person other than a natural Person,
would have been known by a Responsible Official of that Person).
"type", when used with respect to any Loan or Advance, means the
designation of whether such Loan or Advance is an Alternate Base Rate Loan or
Advance, or a Eurodollar Rate Loan or Advance.
"UBOC" has the meaning set forth in the recitals to this Agreement.
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"Wholly-Owned Subsidiary" means a Subsidiary of Borrower,
100% of the capital stock or other equity interest of which is
owned, directly or indirectly, by Borrower, except for director's
qualifying shares required by applicable Laws.
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
changes during the term of this Agreement such that the covenants
contained in Sections 6.12 through 6.16, inclusive, would then be
calculated in a different manner or with different components, (a)
Borrower and the Lenders agree to amend this Agreement in such respects
as are necessary to conform those covenants as criteria for evaluating
Borrower's financial condition to substantially the same criteria as
were effective prior to such change in GAAP and (b) Borrower shall be
deemed to be in compliance with the covenants contained in the aforesaid
Sections if and to the extent that Borrower would have been in
compliance therewith under GAAP as in effect immediately prior to such
change, but shall have the obligation to deliver each of the materials
described in Article 7 to the Administrative Agent and the Lenders, on
the dates therein specified, with financial data presented in a manner
which conforms with GAAP as in effect immediately prior to such change.
1.4 Rounding. Any financial ratios required to be maintained by
Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one
place more than the number of places by which such ratio is expressed in
this Agreement and rounding the result up or down to the nearest number
(with a round-up if there is no nearest number) to the number of places
by which such ratio is expressed in this Agreement.
1.5 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.
1.6 References to "Borrower and its Subsidiaries". Any reference
herein to "Borrower and its Subsidiaries" or the like shall refer solely
to Borrower during such times, if any, as Borrower shall have no
Subsidiaries.
1.7 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
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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 2.
LOANS AND LETTERS OF CREDIT
2.1 Loans-General.
(a) Subject to the terms and conditions set forth in this
Agreement, at any time and from time to time from the Closing Date
through the Revolving Loan Maturity Date, each Lender shall, pro rata
according to that Lender's Pro Rata Share of the then applicable
Revolving Commitment, make Advances to Borrower under the Revolving
Commitment in such amounts as Borrower may request that do not result in
the sum of (i) the aggregate principal amount outstanding under the
Revolving Notes and (ii) the Aggregate Effective Amount of all
outstanding Letters of Credit to exceed the Revolving Commitment.
Subject to the limitations set forth herein, Borrower may borrow, repay
and reborrow under the Revolving Commitment without premium or penalty.
(b) Subject to the terms and conditions set forth in this
Agreement, on the Closing Date, each Lender shall, pro rata according to
that Lender's Pro Rata Share of the Term Commitment, make an Advance to
Borrower under the Term Commitment such that the aggregate of all such
Advances equals the Term Commitment. Amounts repaid under the Term
Commitment may not be reborrowed.
(c) Subject to the next sentence, each Loan shall be made
pursuant to a Request for Loan which shall specify the requested (i)
date of such Loan, (ii) type of Loan, (iii) amount of such Loan, and
(iv) in the case of a Eurodollar Rate Loan, the Eurodollar Period for
such Loan. Unless the Administrative Agent has notified, in its sole and
absolute discretion, Borrower to the contrary, a Loan may be requested
by telephone by a Responsible Official of Borrower, in which case
Borrower shall confirm such request by promptly delivering a Request for
Loan (conforming to the preceding sentence) in person or by telecopier
to the Administrative Agent. The Administrative Agent shall incur no
liability whatsoever hereunder in acting upon any telephonic request for
Loan purportedly made by a Responsible Official of Borrower, and
Borrower hereby agrees to indemnify the Administrative Agent from any
loss, cost, expense or liability as a result of so acting.
(d) Promptly following receipt of a Request for Loan, the
Administrative Agent shall notify each Lender by telephone or telecopier
(and if by telephone, promptly confirmed by telecopier) of the date and
type of the Loan, the applicable Eurodollar Period, and that Lender's
Pro Rata Share of the Loan. Not later than 12:00 p.m., California time,
on the date specified for any Loan (which must be a Banking Day), 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 Office. Upon satisfaction or waiver of the
applicable
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conditions set forth in Article 8, all Advances shall be credited on
that date in immediately available funds to the Designated Deposit
Account.
(e) Unless the Requisite Lenders otherwise consent, each
Revolving Loan which is an Alternate Base Rate Loan shall be not less
than $250,000 and in an integral multiple of $100,000 and each Revolving
Loan which is a Eurodollar Rate Loan shall be not less than $250,000 and
in an integral multiple of $250,000.
(f) The Advances made by each Lender under the Revolving
Commitment shall be evidenced by that Lender's Revolving Note. The
Advances made by each Lender under the Term Commitment shall be
evidenced by that Lender's Term Note.
(g) A Request for Loan that is a Eurodollar Rate Loan shall
become irrevocable three Eurodollar Banking Days before the requested
date of the Loan. A Request for Loan that is an Alternate Base Rate Loan
shall become irrevocable one Banking Day before the requested date of
the Loan.
(h) If no Request for Loan (or telephonic request for Loan
referred to in the second sentence of Section 2.1(c), if applicable) has
been made within the requisite notice periods set forth in Section 2.2
or 2.3 prior to the end of the Eurodollar Period for any outstanding
Eurodollar Rate Loan, then on the last day of such Eurodollar Period,
such Eurodollar Rate Loan shall be automatically converted into an
Alternate Base Rate Loan in the same amount.
2.2 Alternate Base Rate Loans. Each request by Borrower for an
Alternate Base Rate Loan shall be made pursuant to a Request for Loan (or
telephonic or other request for loan referred to in the second sentence of
Section 2.1(c), if applicable) received by the Administrative Agent, at the
Administrative Agent's Office, not later than 10:00 a.m. California time, on the
date (which must be a Banking Day) immediately prior to the date of the
requested Alternate Base Rate Loan. All Loans shall constitute Alternate Base
Rate Loans unless properly designated as a Eurodollar Rate Loan pursuant to
Section 2.3.
2.3 Eurodollar Rate Loans.
(a) Each request by Borrower for a Eurodollar Rate Loan shall be
made pursuant to a Request for Loan (or telephonic or other request for
Loan referred to in the second sentence of Section 2.1(c), if
applicable) received by the Administrative Agent, at the Administrative
Agent's Office, not later than 9:00 a.m., California time, at least
three (3) Eurodollar Banking Days before the first day of the applicable
Eurodollar Period.
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(b) On the date which is two (2) Eurodollar Banking Days before
the first day of the applicable Eurodollar Period, the Administrative
Agent shall confirm its determination of the applicable Eurodollar Rate
(which determination shall be conclusive in the absence of manifest
error) and promptly shall give notice of the same to Borrower and the
Lenders by telephone or telecopier (and if by telephone, promptly
confirmed by telecopier).
(c) Unless the Administrative Agent and the Requisite Lenders
otherwise consent, no more than three (3) Eurodollar Rate Loans shall be
outstanding at any one time.
(d) No Eurodollar Rate Loan may be requested during the
continuation of a Default or Event of Default.
(e) Nothing contained herein shall require any Lender to fund any
Eurodollar Rate Advance in the Designated Eurodollar Market.
2.4 Letters of Credit.
(a) The Existing Letters of Credit described in Schedule 2.4
shall be Letters of Credit for all purposes under this Agreement.
Subject to the terms and conditions hereof, at any time and from time to
time from the Closing Date through the Revolving Loan Maturity Date, the
Issuing Lender shall issue such Letters of Credit under the Revolving
Commitment as Borrower may request by a Request for Letter of Credit;
provided that (i) giving effect to all such Letters of Credit, the sum
of (A) the aggregate principal amount outstanding under the Revolving
Notes plus (B) the Aggregate Effective Amount of all outstanding Letters
of Credit, does not exceed the then applicable Revolving Commitment and
(ii) the Aggregate Effective Amount under all outstanding Letters of
Credit does not exceed $10,000,000. Each Letter of Credit shall be in a
form reasonably acceptable to the Issuing Lender. Unless all the Lenders
otherwise consent in a writing delivered to the Administrative Agent,
the term of any Letter of Credit (other than any Existing Letters of
Credit) shall not exceed one (1) year or extend one hundred eighty (180)
days beyond the Revolving Loan Maturity Date.
(b) Each Request for Letter of Credit shall be submitted to the
Issuing Lender, with a copy to the Administrative Agent, at least two
(2) Banking Days prior to the date upon which the related Letter of
Credit is proposed to be issued. The Administrative Agent shall promptly
notify the Issuing Lender whether such Request for Letter of Credit, and
the issuance of a Letter of Credit pursuant thereto, conforms to the
requirements of this Agreement. Upon issuance of a Letter of Credit, the
Issuing Lender shall promptly notify
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the Administrative Agent, and the Administrative Agent shall promptly
notify the Lenders, of the amount and terms thereof.
(c) Upon the issuance of a Letter of Credit, each Lender shall be
deemed to have purchased a pro rata participation in such Letter of
Credit from the Issuing Lender in an amount equal to that Lender's Pro
Rata Share of the Revolving Commitment. Without limiting the scope and
nature of each Lender's participation in any Letter of Credit, to the
extent that the Issuing Lender has not been reimbursed by Borrower for
any payment required to be made by the Issuing Lender under any Letter
of Credit, each Lender shall, pro rata according to its Pro Rata Share,
reimburse the Issuing Lender through the Administrative Agent promptly
upon demand for the amount of such payment. The obligation of each
Lender to so reimburse the Issuing Lender shall be absolute and
unconditional and shall not be affected by the occurrence of an Event of
Default or any other occurrence or event. Any such reimbursement shall
not relieve or otherwise impair the obligation of Borrower to reimburse
the Issuing Lender for the amount of any payment made by the Issuing
Lender under any Letter of Credit together with interest as hereinafter
provided.
(d) Borrower agrees to pay to the Issuing Lender through the
Administrative Agent an amount equal to any payment made by the Issuing
Lender with respect to each Letter of Credit within one (1) Banking Day
after demand made by the Issuing Lender therefor, together with interest
on such amount from the date of any payment made by the Issuing Lender
at the rate applicable to Alternate Base Rate Loans for two (2) Banking
Days and thereafter at the Default Rate. The principal amount of any
such payment shall be used to reimburse the Issuing Lender for the
payment made by it under the Letter of Credit and, to the extent that
the Lenders have not reimbursed the Issuing Lender pursuant to Section
2.4(c), the interest amount of any such payment shall be for the account
of the Issuing Lender. Each Lender that has reimbursed the Issuing
Lender pursuant to Section 2.4(c) for its Pro Rata Share of any payment
made by the Issuing Lender under a Letter of Credit shall thereupon
acquire a pro rata participation, to the extent of such reimbursement,
in the claim of the Issuing Lender against Borrower for reimbursement of
principal and interest under this Section 2.4(d) and shall share, in
accordance with that pro rata participation, in any principal payment
made by Borrower with respect to such claim and in any interest payment
made by Borrower (but only with respect to periods subsequent to the
date such Lender reimbursed the Issuing Lender) with respect to such
claim.
(e) Borrower may, pursuant to a Request for Loan, request that
Advances be made pursuant to Section 2.1(a) to provide funds for the
payment required by Section 2.4(d) and, for this purpose, the conditions
precedent set forth in Article 8 shall not
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apply. The proceeds of such Advances shall be paid directly to the
Issuing Lender to reimburse it for the payment made by it under the
Letter of Credit.
(f) If Borrower fails to make the payment required by Section
2.4(d) within the time period therein set forth, in lieu of the
reimbursement to the Issuing Lender under Section 2.4(c) the Issuing
Lender may (but is not required to), without notice to or the consent of
Borrower, instruct the Administrative Agent to cause Advances to be made
by the Lenders under the Revolving Commitment in an aggregate amount
equal to the amount paid by the Issuing Lender with respect to that
Letter of Credit and, for this purpose, the conditions precedent set
forth in Article 8 shall not apply. The proceeds of such Advances shall
be paid directly to the Issuing Lender to reimburse it for the payment
made by it under the Letter of Credit.
(g) The issuance of any supplement, modification, amendment,
renewal, or extension to or of any Letter of Credit shall be treated in
all respects the same as the issuance of a new Letter of Credit.
(h) The obligation of Borrower to pay to the Issuing Lender the
amount of any payment made by the Issuing Lender under any Letter of
Credit shall be absolute, unconditional, and irrevocable, subject only
to performance by the Issuing Lender of its obligations to Borrower
under Uniform Commercial Code Section 5109. Without limiting the
foregoing, Borrower's obligations shall not be affected by any of the
following circumstances:
(i) any lack of validity or enforceability prior to its
stated expiration date of the Letter of Credit, this Agreement,
or any other agreement or instrument relating thereto;
(ii) any amendment or waiver of or any consent to departure
from the Letter of Credit, this Agreement, or any other agreement
or instrument relating thereto, with the consent of Borrower;
(iii) the existence of any claim, setoff, defense, or other
rights which Borrower may have at any time against the Issuing
Lender, the Administrative Agent or any Lender, any beneficiary
of the Letter of Credit (or any persons or entities for whom any
such beneficiary may be acting) or any other Person, whether in
connection with the Letter of Credit, this Agreement, or any
other agreement or instrument relating thereto, or any unrelated
transactions;
(iv) any demand, statement, or any other document presented
under the Letter of Credit proving to be forged, fraudulent,
invalid, or insufficient in
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any respect or any statement therein being untrue or inaccurate
in any respect whatsoever so long as any such document appeared
substantially to comply with the terms of the Letter of Credit;
(v) payment by the Issuing Lender in good faith under the
Letter of Credit against presentation of a draft or any
accompanying document which does not strictly comply with the
terms of the Letter of Credit, unless the acceptance of such
draft or other accompanying document constituted gross
negligence;
(vi) the existence, character, quality, quantity, condition,
packing, value or delivery of any Property purported to be
represented by documents presented in connection with any Letter
of Credit or any difference between any such Property and the
character, quality, quantity, condition, or value of such
Property as described in such documents;
(vii) the time, place, manner, order or contents of shipments
or deliveries of Property as described in documents presented in
connection with any Letter of Credit or the existence, nature and
extent of any insurance relative thereto;
(viii) the solvency or financial responsibility of any party
issuing any documents in connection with a Letter of Credit;
(ix) any failure or delay in notice of shipments or arrival
of any Property;
(x) any error in the transmission of any message relating to
a Letter of Credit not caused by the Issuing Lender, or any delay
or interruption in any such message;
(xi) any error, neglect or default of any correspondent of
the Issuing Lender in connection with a Letter of Credit;
(xii) any consequence arising from acts of God, war,
insurrection, civil unrest, disturbances, labor disputes,
emergency conditions or other causes beyond the control of the
Issuing Lender;
(xiii) so long as the Issuing Lender in good faith determines
that the contract or document appears substantially to comply
with the terms of the Letter of Credit, the form, accuracy,
genuineness or legal effect of any contract or document referred
to in any document submitted to the Issuing Lender in connection
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with a Letter of Credit unless the Issuing Lender's actions
constituted gross negligence; and
(xiv) where the Issuing Lender has acted in good faith and
observed general banking usage, any other circumstances
whatsoever unless the Issuing Lender's actions constituted gross
negligence.
(i) The Issuing Lender shall be entitled to the protection
accorded to the Administrative Agent pursuant to Section 10.6, with all
necessary changes.
(j) The Uniform Customs and Practice for Documentary Credits, as
published in its most current version by the International Chamber of
Commerce, shall be deemed a part of this Section and shall apply to all
Letters of Credit to the extent not inconsistent with applicable Law.
2.5 Voluntary Reduction of Revolving Commitment. Borrower shall have
the right, at any time and from time to time, without penalty or charge, upon at
least five (5) Banking Days' prior written notice by a Responsible Official of
Borrower to the Administrative Agent, voluntarily to reduce, permanently and
irrevocably, in aggregate principal amounts in an integral multiple of $500,000
but not less than $5,000,000, or to terminate, all or a portion of the then
undisbursed portion of the Revolving Commitment. The Administrative Agent
shall promptly notify the Lenders of any reduction or termination of the
Revolving Commitment under this Section.
2.6 Administrative Agent's Right to Assume Funds Available for
Advances. Unless the Administrative Agent shall have been notified by any Lender
no later than 10:00 a.m. on the Banking Day of the proposed funding by the
Administrative Agent of any Loan that such Lender does not intend to make
available to the Administrative Agent such Lender's portion of the total amount
of such Loan, the Administrative Agent may assume that such Lender has made such
amount available to the Administrative Agent on the date of the Loan and the
Administrative Agent may, in reliance upon such assumption, make available to
Borrower a corresponding amount. If the Administrative Agent has made funds
available to Borrower based on such assumption and such corresponding amount is
not in fact made available to the Administrative Agent by such Lender, the
Administrative Agent shall be entitled to recover such corresponding amount on
demand from such Lender. If such Lender does not pay such corresponding amount
forthwith upon the Administrative Agent's demand therefor, the Administrative
Agent promptly shall notify Borrower and Borrower shall pay such corresponding
amount to the Administrative Agent. The Administrative Agent also shall be
entitled to recover from such Lender interest on such corresponding amount in
respect of each day from the date such corresponding amount was made available
by the Administrative Agent to Borrower to the date such corresponding amount is
recovered by the Administrative Agent, at a rate per annum equal to the daily
Federal Funds Rate. Nothing herein shall be deemed to relieve any Lender from
its obligation to fulfill its share of the Commitments or to prejudice any
rights which
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the Administrative Agent or Borrower may have against any Lender as a result of
any default by such Lender hereunder.
2.7 Collateral. The Obligations shall be secured by a first priority
(subject to Liens permitted by Section 6.9) perfected Lien on the Collateral
pursuant to the Security Agreement.
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Article 3.
PAYMENTS AND FEES
3.1 Principal and Interest.
(a) Interest shall be payable on the outstanding daily unpaid
principal amount of each Advance from the date thereof until payment in
full is made and shall accrue and be payable at the rates set forth or
provided for 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, with interest on overdue
interest at the Default Rate to the fullest extent permitted by
applicable Laws.
(b) Interest accrued on each Alternate Base Rate Loan shall be
due and payable on each Monthly Payment Date. Except as otherwise
provided in Sections 3.1(d) and 3.8, the unpaid principal amount of any
Alternate Base Rate Loan shall bear interest at a fluctuating rate per
annum equal to the Alternate Base Rate plus the Applicable Alternate
Base Rate Margin. Each change in the interest rate under this Section
3.1(b) due to a change in the Alternate Base Rate shall take effect
simultaneously with the corresponding change in the Alternate Base Rate.
(c) Interest accrued on each Eurodollar Rate Loan which is for a
term of three months or less shall be due and payable on the last day of
the related Eurodollar Period. Interest accrued on each other Eurodollar
Rate Loan shall be due and payable on the date which is three months
after the date such Eurodollar Rate Loan was made, every three months
thereafter through the last day of the Eurodollar Period and on the last
day of the related Eurodollar Period. Except as otherwise provided in
Sections 3.1(d) and 3.8, (i) the unpaid principal amount of any
Revolving Loan which is a Eurodollar Rate Loan shall bear interest at a
rate per annum equal to the Eurodollar Rate for that Eurodollar Rate
Loan plus the Applicable Eurodollar Rate Margin, and (ii) the unpaid
principal amount of any Term Loan which is a Eurodollar Rate Loan shall
bear interest at a rate per annum equal to the Eurodollar Rate for that
Eurodollar Rate Loan plus (***).
(d) During the existence of an Event of Default, the Loans shall
bear interest at a rate per annum equal to the sum of (i) the interest
rate specified in Sections 3.1(b) or 3.1(c), whichever is applicable,
plus (ii) (***) percentage points.
(e) If not sooner paid, the principal Indebtedness evidenced by
the Notes shall be payable as follows:
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(i) the amount, if any, by which the sum of (A) the principal
Indebtedness evidenced by the Revolving Notes plus (B) the
Aggregate Effective Amount of all outstanding Letters of Credit
at any time exceeds the then applicable Revolving Commitment
shall be payable immediately;
(ii) the principal Indebtedness evidenced by the Term Notes
shall be payable in the installments and on the payment dates set
forth in the Term Notes, and, in any event, the remaining unpaid
principal balance of the Term Notes shall be due and payable in
full on the Term Loan Maturity Date.
(iii) the principal Indebtedness evidenced by the Revolving
Notes shall in any event be payable on the Revolving Loan
Maturity Date.
(f) The principal Indebtedness evidenced by the Term Notes shall
be prepaid on or before the third Banking Day following the receipt by
Borrower or any of its Subsidiaries of (i) Net Cash Sales Proceeds from
Dispositions, by an amount equal to 100% of such Net Cash Sales
Proceeds, (ii) Net Cash Issuance Proceeds from the issuance of debt
securities of Borrower or any of its Subsidiaries, by an amount equal to
100% of such Net Cash Issuance Proceeds, and (iii) Net Cash Issuance
Proceeds from the issuance of equity securities of Borrower or any of
its Subsidiaries (except an issuance of equity securities to Borrower or
to a Wholly-Owned Subsidiary or to employees or former employees of
Borrower pursuant to an employee stock option plan maintained by
Borrower), by an amount equal to 90% of such Net Cash Issuance Proceeds.
Any prepayment of the Term Notes under this Subsection shall be applied
to principal coming due in reverse order of maturity.
(g) The principal Indebtedness evidenced by the Notes may, at any
time and from time to time, voluntarily be paid or prepaid in whole or
in part without premium or penalty, except that with respect to any
voluntary prepayment under this Subsection, (i) any partial prepayment
of a Revolving Loan shall be not less than $100,000 and shall be an
integral multiple of $50,000 unless the entire outstanding amount of
such Loan is being prepaid, (ii) any partial prepayment of the Term Loan
shall be not less than $100,000 and shall be an integral multiple of
$50,000 unless the entire outstanding amount of such Loan is being
prepaid, (iii) the Administrative Agent shall have received written
notice of any prepayment by 9:00 a.m. California time on the date that
is one (1) Banking Day before the date of prepayment (which must be a
Banking Day) in the case of an Alternate Base Rate Loan, and, in the
case of a Eurodollar Rate Loan, three (3) Banking Days before the date
of prepayment, which notice shall identify the date and amount of the
prepayment and the Loan(s) being prepaid, (iv) each prepayment of
principal on any Eurodollar Rate Loan shall be accompanied by payment of
interest accrued to the date of payment on the amount of principal paid,
(v) any payment or prepayment of all or any part of any Eurodollar Rate
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Loan on a day other than the last day of the applicable Eurodollar
Period shall be subject to Section 3.7(e), and (vi) prepayment of the
Term Notes under this Subsection shall be applied to principal coming
due in reverse order of maturity.
3.2 Arranger and Agency Fees. On the Closing Date and on each other
date upon which a fee is payable, Borrower shall pay to the Arranger and the
Administrative Agent such fees as heretofore agreed upon by letter agreement
between Borrower and the Arranger. The fees paid to the Arranger and the
Administrative Agent, are solely for their own account and are nonrefundable.
3.3 Commitment Fee. From the Closing Date through the Revolving Loan
Maturity Date, Borrower shall pay to the Administrative Agent, for the ratable
accounts of the Lenders pro rata according to their Pro Rata Share of the
Revolving Commitment, a commitment fee equal to the Applicable Commitment Fee
Rate per annum times the average daily amount by which the Revolving Commitment
exceeds the (i) aggregate daily principal Indebtedness evidenced by the
Revolving Notes plus (ii) the Aggregate Effective Amount of all Letters of
Credit then outstanding. The commitment fee shall be payable quarterly in
arrears as of each Quarterly Payment Date within ten (10) days after receipt by
Borrower of an invoice therefor from the Administrative Agent.
3.4 Letter of Credit Fees. With respect to each Letter of Credit,
Borrower shall pay the following fees:
(a) concurrently with the issuance of each Standby Letter of
Credit, to the Administrative Agent a standby letter of credit fee in an
amount equal to (***) per annum times the face amount of such Standby
Letter of Credit through the termination or expiration of such Standby
Letter of Credit, the first 10% of which fee the Administrative Agent
shall promptly pay to UBOC and the remainder of which fee the
Administrative Agent shall promptly pay to the Lenders ratably, in
accordance with their respective Pro Rata Shares of the Commitment;
(b) concurrently with the issuance of each Commercial Letter of
Credit, to the Administrative Agent a commercial letter of credit
issuance fee in the amount set forth from time to time as the Issuing
Lender's published scheduled fee for the issuance of commercial letters
of credit, which fee the Administrative Agent shall promptly pay to the
Lenders ratably, in accordance with their respective Pro Rata Shares of
the Commitment; and
(c) concurrently with each negotiation, drawing or amendment of
each Commercial Letter of Credit, to the Issuing Lender for the sole
account of the Issuing Lender, negotiation, drawing and amendment fees
in the amounts set forth from time to time as the Issuing Lender's
published scheduled fees for such services.
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Each of the fees payable with respect to Letters of Credit under this
Section is earned when due and is nonrefundable.
3.5 Increased Commitment Costs. If any Lender shall determine in
good faith that the introduction after the Closing Date of any applicable law,
rule, regulation or guideline regarding capital adequacy, or any change therein
or any change in the interpretation or administration thereof by any central
bank or other Governmental Agency charged with the interpretation or
administration thereof, or compliance by such Lender (or its Eurodollar Lending
Office) or any corporation controlling such Lender, with any request, guideline
or directive regarding capital adequacy (whether or not having the force of Law)
of any such central bank or other authority not imposed as a result of such
Lender's or such corporation's failure to comply with any other Laws, affects or
would affect the amount of capital required or expected to be maintained by such
Lender or any corporation controlling such Lender and (taking into consideration
such Lender's or such corporation's policies with respect to capital adequacy
and such Lender's desired return on capital) determines in good faith that the
amount of such capital is increased, or the rate of return on capital is
reduced, as a consequence of its obligations under this Agreement, then, within
five (5) Banking Days after demand of such Lender, Borrower shall pay to such
Lender, from time to time as specified in good faith by such Lender, additional
amounts sufficient to compensate such Lender in light of such circumstances, to
the extent reasonably allocable to such obligations under this Agreement,
provided that Borrower shall not be obligated to pay any such amount unless such
Lender is charging similar amounts to similarly situated Borrowers and provided
further that Borrower shall not be obligated to pay any such amount which arose
prior to the date which is ninety (90) days preceding the date of such demand or
is attributable to periods prior to the date which is ninety (90) days preceding
the date of such demand, and Borrower shall not be obligated to pay any such
amount if, within five (5) Banking Days after demand of such Lender, Borrower
notifies such Lender of Borrower's intention to repay all Obligations then owing
to such Lender and to terminate the Commitments of such Lender, and if Borrower
in fact repays such Obligations and terminates such Commitments within [thirty
(30) days] after demand of such Lender. Each Lender's determination of such
amounts shall be conclusive in the absence of manifest error.
3.6 Eurodollar Costs and Related Matters.
(a) In the event that any Governmental Agency imposes on any
Lender any reserve or comparable requirement (including any emergency,
supplemental or other reserve) with respect to the Eurodollar
Obligations of that Lender, Borrower shall pay that Lender within five
(5) Banking Days after demand all amounts necessary to compensate such
Lender (determined as though such Lender's Eurodollar Lending Office had
funded 100% of its Eurodollar Rate Advance in the Designated Eurodollar
Market) in respect of the imposition of such reserve requirements
(provided, that Borrower shall not be obligated to pay any such amount
which arose prior to the date which is ninety (90) days preceding
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the date of such demand or is attributable to periods prior to the date
which is ninety (90) days preceding the date of such demand). The
Lender's determination of such amount shall be conclusive in the absence
of manifest error.
(b) If, after the date hereof, the existence or occurrence of any
Special Eurodollar Circumstance:
(1) shall subject any Lender or its Eurodollar Lending Office
to any tax, duty or other charge or cost with respect to any
Eurodollar Rate Advance, any of its Notes evidencing Eurodollar Rate
Loans or its obligation to make Eurodollar Rate Advances, or shall
change the basis of taxation of payments to any Lender attributable
to the principal of or interest on any Eurodollar Rate Advance or
any other amounts due under this Agreement in respect of any
Eurodollar Rate Advance, any of its Notes evidencing Eurodollar Rate
Loans or its obligation to make Eurodollar Rate Advances, excluding
(i) taxes imposed on or measured in whole or in part by its overall
net income by (A) any jurisdiction (or political subdivision
thereof) in which it is organized or maintains its principal office
or Eurodollar Lending Office or (B) any jurisdiction (or political
subdivision thereof) in which it is "doing business" and (ii) any
withholding taxes or other taxes based on gross income imposed by
the United States of America for any period with respect to which it
has failed to provide Borrower with the appropriate form or forms
required by Section 11.21, to the extent such forms are then
required by applicable Laws;
(2) shall impose, modify or deem applicable any reserve not
applicable or deemed applicable on the date hereof (including any
reserve imposed by the Board of Governors of the Federal Reserve
System, special deposit, capital or similar requirements against
assets of, deposits with or for the account of, or credit extended
by, any Lender or its Eurodollar Lending Office); or
(3) shall impose on any Lender or its Eurodollar Lending
Office or the Designated Eurodollar Market any other condition
affecting any Eurodollar Rate Advance, any of its Notes evidencing
Eurodollar Rate Loans, its obligation to make Eurodollar Rate
Advances or this Agreement, or shall otherwise affect any of the
same;
and the result of any of the foregoing, as determined in good faith by
such Lender, increases the cost to such Lender or its Eurodollar Lending
Office of making or maintaining any Eurodollar Rate Advance or in
respect of any Eurodollar Rate Advance, any of its Notes evidencing
Eurodollar Rate Loans or its obligation to make Eurodollar Rate Advances
or reduces the amount of any sum received or receivable by such Lender
or its Eurodollar
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Lending Office with respect to any Eurodollar Rate Advance, any of its
Notes evidencing Eurodollar Rate Loans or its obligation to make
Eurodollar Rate Advances (assuming such Lender's Eurodollar Lending
Office had funded 100% of its Eurodollar Rate Advance in the Designated
Eurodollar Market), then, within five (5) Banking Days after demand by
such Lender (with a copy to the Administrative Agent), Borrower shall
pay to such Lender such additional amount or amounts as will compensate
such Lender for such increased cost or reduction (determined as though
such Lender's Eurodollar Lending Office had funded 100% of its
Eurodollar Rate Advance in the Designated Eurodollar Market); provided,
that Borrower shall not be obligated to pay any such amount which arose
prior to the date which is ninety (90) days preceding the date of such
demand or is attributable to periods prior to the date which is ninety
(90) days preceding the date of such demand. A statement of any Lender
claiming compensation under this subsection shall be conclusive in the
absence of manifest error.
(c) If, after the date hereof, the existence or occurrence of any
Special Eurodollar Circumstance shall, in the good faith opinion of any
Lender, make it unlawful or impossible for such Lender or its Eurodollar
Lending Office to make, maintain or fund its portion of any Eurodollar
Rate Loan, or materially restrict the authority of such Lender to
purchase or sell, or to take deposits of, Dollars in the Designated
Eurodollar Market, or to determine or charge interest rates based upon
the Eurodollar Rate, and such Lender shall so notify the Administrative
Agent, then such Lender's obligation to make Eurodollar Rate Advances
shall be suspended for the duration of such illegality or impossibility
and the Administrative Agent forthwith shall give notice thereof to the
other Lenders and Borrower. Upon receipt of such notice, the outstanding
principal amount of such Lender's Eurodollar Rate Advances, together
with accrued interest thereon, automatically shall be converted to
Alternate Base Rate Advances on either (1) the last day of the
Eurodollar Period(s) applicable to such Eurodollar Rate Advances if such
Lender may lawfully continue to maintain and fund such Eurodollar Rate
Advances to such day(s) or (2) immediately if such Lender may not
lawfully continue to fund and maintain such Eurodollar Rate Advances to
such day(s), provided that in such event the conversion shall not be
subject to payment of a prepayment fee under Section 3.6(e). Each Lender
agrees to endeavor promptly to notify Borrower of any event of which it
has actual knowledge, occurring after the Closing Date, which will cause
that Lender to notify the Administrative Agent under this Section, and
agrees to designate a different Eurodollar Lending Office if such
designation will avoid the need for such notice and will not, in the
good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender. In the event that any Lender is unable,
for the reasons set forth above, to make, maintain or fund its portion
of any Eurodollar Rate Loan, such Lender shall fund such amount as an
Alternate Base Rate Advance for the same period of time, and such amount
shall be treated in all respects as an Alternate Base Rate Advance. Any
Lender whose obligation to make Eurodollar Rate Advances has been
suspended
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under this Section shall promptly notify the Administrative Agent and
Borrower of the cessation of the Special Eurodollar Circumstance which
gave rise to such suspension.
(d) If, with respect to any proposed Eurodollar Rate Loan:
(1) the Administrative Agent reasonably determines that, by
reason of circumstances affecting the Designated Eurodollar Market
generally that are beyond the reasonable control of the Lenders,
deposits in Dollars (in the applicable amounts) are not being
offered to any Lender in the Designated Eurodollar Market for the
applicable Eurodollar Period; or
(2) the Requisite Lenders advise the Administrative Agent
that the Eurodollar Rate as determined by the Administrative Agent
(i) does not represent the effective pricing to such Lenders for
deposits in Dollars in the Designated Eurodollar Market in the
relevant amount for the applicable Eurodollar Period, or (ii) will
not adequately and fairly reflect the cost to such Lenders of making
the applicable Eurodollar Rate Advances;
then the Administrative Agent forthwith shall give notice thereof to
Borrower and the Lenders, whereupon until the Administrative Agent
notifies Borrower that the circumstances giving rise to such suspension
no longer exist, the obligation of the Lenders to make any future
Eurodollar Rate Advances shall be suspended.
(e) Upon payment or prepayment of any Eurodollar Rate Advance
(other than as the result of a conversion required under Section 3.6(c)
on a day other than the last day in the applicable Eurodollar Period
(whether voluntarily, involuntarily, by reason of acceleration, or
otherwise), or upon the failure of Borrower (for a reason other than the
breach by a Lender of its obligation pursuant to Section 2.1(a) to make
an Advance) to borrow on the date or in the amount specified for a
Eurodollar Rate Loan in any Request for Loan after such Request for Loan
has become irrevocable, Borrower shall pay to the appropriate Lender
within five (5) Banking Days after demand a prepayment fee or failure to
borrow fee, as the case may be (determined as though 100% of the
Eurodollar Rate Advance had been funded in the Designated Eurodollar
Market) equal to the sum of:
(1) $250; plus
(2) the amount, if any, by which (i) the additional interest
would have accrued on the amount prepaid or not borrowed at the
Eurodollar Rate plus the Applicable Eurodollar Rate Margin if that
amount had remained or been outstanding through the last day of the
applicable Eurodollar Period exceeds (ii) the interest that the
Lender could recover by placing such amount on deposit in the
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Designated Eurodollar Market for a period beginning on the date of
the prepayment or failure to borrow and ending on the last day of
the applicable Eurodollar Period (or, if no deposit rate quotation
is available for such period, for the most comparable period for
which a deposit rate quotation may be obtained); plus
(3) all out-of-pocket expenses incurred by the Lender
reasonably attributable to such payment, prepayment or failure to
borrow.
Each Lender's determination of the amount of any prepayment fee payable
under this Section shall be conclusive in the absence of manifest error.
(f) Each Lender agrees to endeavor promptly to notify Borrower of
any event of which it has actual knowledge, occurring after the Closing
Date, which will entitle such Lender to compensation pursuant to clause
(a) or clause (b) of this Section, and agrees to designate a different
Eurodollar Lending Office if such designation will avoid the need for or
reduce the amount of such compensation and will not, in the good faith
judgment of such Lender, otherwise be materially disadvantageous to such
Lender. Any request for compensation by a Lender under this Section
shall set forth the basis upon which it has been determined that such an
amount is due from Borrower, a calculation of the amount due, and a
certification that the corresponding costs have been incurred by the
Lender. Borrower shall not be obligated to pay any such compensation to
a Lender under this Section if, within five (5) Banking Days after
receiving notice from such Lender requesting such compensation, Borrower
notifies such Lender of Borrower's intention to repay all Obligations
then owing to such Lender and to terminate the Commitments of such
Lender, and if Borrower in fact repays such Obligations and terminates
such Commitments within thirty (30) days after Borrower receipt of such
Lender's notice requesting compensation.
3.7 Late Payments. If any installment of principal or interest or
any fee or cost or other amount payable under any Loan Document to the
Administrative Agent or any Lender is not paid when due, it shall thereafter
bear interest at a fluctuating interest rate per annum at all times equal to the
sum of the Alternate Base Rate plus 2%, to the fullest extent permitted by
applicable Laws. Accrued and unpaid interest on past due amounts (including,
without limitation, interest on past due interest) shall be compounded monthly,
on the last day of each calendar month, to the fullest extent permitted by
applicable Laws.
3.8 Computation of Interest and Fees. Computation of interest and
fees under this Agreement shall be calculated on the basis of a year of 360 days
and the actual number of days elapsed. Interest shall accrue on each Loan for
the day on which the Loan is made; interest shall not accrue on a Loan, or any
portion thereof, for the day on which the Loan or such portion is paid. Any Loan
that is repaid on the same day on which it is made shall bear interest for one
day. Notwithstanding anything in this Agreement to the contrary, interest in
excess of the maximum
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amount permitted by applicable Laws shall not accrue or be payable hereunder or
under the Notes, and any amount paid as interest hereunder or under the Notes
which would otherwise be in excess of such maximum permitted amount shall
instead be treated as a payment of principal.
3.9 Non-Banking Days. If any payment to be made by Borrower or any
other Party under any Loan Document shall come due on a day other than a Banking
Day, payment shall instead be considered due on the next succeeding Banking Day
and the extension of time shall be reflected in computing interest and fees.
3.10 Manner and Treatment of Payments.
(a) Each payment hereunder (except payments pursuant to Sections
3.5, 3.6, 11.3, 11.11 and 11.22) or on the Notes or under any other Loan
Document shall be made to the Administrative Agent at the Administrative
Agent's Office for the account of each of the Lenders or the
Administrative Agent, as the case may be, in immediately available funds
not later than 11:00 a.m. California time, on the day of payment (which
must be a Banking Day). All payments received after such time, on any
Banking Day, shall be deemed received on the next succeeding Banking
Day. The amount of all payments received by the Administrative Agent for
the account of each Lender shall be immediately paid by the
Administrative Agent to the applicable Lender in immediately available
funds and, if such payment was received by the Administrative Agent by
11:00 a.m., California time, on a Banking Day and not so made available
to the account of a Lender on that Banking Day, the Administrative Agent
shall reimburse that Lender for the cost to such Lender of funding the
amount of such payment at the Federal Funds Rate. All payments shall be
made in lawful money of the United States of America.
(b) Borrower hereby authorizes the Administrative Agent to debit
the general operating bank account of Borrower to effect any payment due
to the Lenders or the Administrative Agent pursuant to this Agreement.
Any resulting overdraft in such account shall be payable by Borrower to
the Administrative Agent on the next following Banking Day.
(c) Except to the extent provided in Sections 3.5 and 3.6(f),
each payment or prepayment on account of any Loan shall be applied pro
rata according to the outstanding Advances made by each Lender
comprising such Loan.
(d) Each Lender shall use its best efforts to keep a record (in
writing or by an electronic data entry system) of Advances made by it
and payments received by it with respect to each of its Notes and,
subject to Section 10.6(g), such record shall, as against Borrower, be
presumptive evidence of the amounts owing. Notwithstanding the
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foregoing sentence, the failure by any Lender to keep such a record
shall not affect Borrower's obligation to pay the Obligations.
(e) Each payment of any amount payable by Borrower or any other
Party under this Agreement or any other Loan Document shall be made free
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, excluding (i) taxes imposed on or measured in
whole or in part by its overall net income by (A) any jurisdiction (or
political subdivision thereof) in which it is organized or maintains its
principal office or Eurodollar Lending Office or (B) any jurisdiction
(or political subdivision thereof) in which it is "doing business" and
(ii) any withholding taxes or other taxes based on gross income imposed
by the United States of America for any period with respect to which it
has failed to provide Borrower with the appropriate form or forms
required by Section 11.21, to the extent such forms are then required by
applicable Laws (all such non-excluded taxes, assessments or other
charges being hereinafter referred to as "Taxes"). To the extent that
Borrower is obligated by applicable Laws to make any deduction or
withholding on account of Taxes from any amount payable to any Lender
under this Agreement, Borrower shall (i) make such deduction or
withholding and pay the same to the relevant Governmental Agency and
(ii) pay such additional amount to that Lender as is necessary to result
in that Lender's receiving a net after-Tax 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, that Lender shall promptly refund such excess to Borrower.
3.11 Funding Sources. Nothing in this Agreement shall be deemed to
obligate any Lender to obtain the funds for any Loan or Advance in any
particular place or manner or to constitute a representation by any Lender that
it has obtained or will obtain the funds for any Loan or Advance in any
particular place or manner.
3.12 Failure to Charge Not Subsequent Waiver. Any decision by the
Administrative Agent or any Lender not to require payment of any interest
(including interest arising under Section 3.7), fee, cost 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 (including interest arising under Section 3.7), fee, cost or other
amount payable under any Loan Document, or to calculate an amount payable by
another method that is not inconsistent with this Agreement, on any other or
subsequent occasion.
3.13 Administrative Agent's Right to Assume Payments Will be Made.
Unless the Administrative Agent shall have been notified by Borrower prior to
the date on which any payment to be made by Borrower hereunder is due that
Borrower does not intend to remit such payment, the
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Administrative Agent may, in its discretion, assume that Borrower 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 Borrower
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 in
respect of 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 the Federal Funds Rate.
3.14 Fee Determination Detail. The Administrative Agent, and any
Lender, shall provide reasonable detail to Borrower regarding the manner in
which the amount of any payment to the Administrative Agent and the Lenders, or
that Lender, under Article 3 has been determined, concurrently with demand for
such payment.
3.15 Survivability. All of Borrower's obligations under Sections 3.5
and 3.6 shall survive for the ninety (90) day period following the date on which
the Commitment is terminated and all Loans hereunder are fully paid, and
Borrower shall remain obligated thereunder for all claims under such Sections
made by any Lender to Borrower prior to the expiration of such period to the
extent provided in such Sections.
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Article 4.
REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to the Lenders that:
4.1 Existence and Qualification; Power; Compliance With Laws.
Borrower is a corporation duly formed, validly existing and in good standing
under the Laws of Delaware. Borrower is duly qualified or registered to transact
business and is in good standing in California 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. Borrower has all requisite 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 its Obligations. The
chief executive offices of Borrower are located in California. All outstanding
shares of capital stock of Borrower are duly authorized, validly issued, fully
paid and non-assessable, and no holder thereof has any enforceable right of
rescission under any applicable state or federal securities Laws. Borrower 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 the failure so to comply, obtain authorizations, etc., file,
register, qualify or obtain exemptions does not constitute a Material Adverse
Effect.
4.2 Authority; Compliance With Other Agreements and Instruments and
Government Regulations. The execution, delivery and performance by Borrower and
the Subsidiary Guarantors of the Loan Documents to which it is a Party have been
duly authorized by all necessary corporate action, and do not and will 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, articles of incorporation or bylaws, as applicable;
(c) Result in or require the creation or imposition of any Lien
(other than pursuant to the Loan Documents) 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 in
any respect that constitutes a Material Adverse Effect;
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(e) Result in a breach of or constitute a 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 in any respect that constitutes a Material Adverse
Effect;
and such Party is not in violation of, or default under, any Requirement of Law
or Contractual Obligation, or any indenture, loan or credit agreement described
in Section 4.2(e), in any respect that constitutes a Material Adverse Effect.
4.3 No Governmental Approvals Required. Except as previously
obtained or made, no authorization, consent, approval, order, license or permit
from, or filing, registration or qualification with, any Governmental Agency is
or will be required to authorize or permit under applicable Laws the execution,
delivery and performance by Borrower or any Subsidiary Guarantor of the Loan
Documents to which it is a Party (except where the failure to do so does not
constitute a Material Adverse Effect).
4.4 Subsidiaries.
(a) Schedule 4.4 hereto correctly sets forth the names, form of
legal entity, number of shares of capital stock issued and outstanding,
number of shares owned by Borrower or a Subsidiary of Borrower
(specifying such owner) and jurisdictions of organization of all
Subsidiaries of Borrower and specifies which thereof, as of the Closing
Date, are Inactive Subsidiaries. Except as described in Schedule 4.4,
Borrower does not own any capital stock, equity interest or debt
security which is convertible, or exchangeable, for capital stock or
equity interest in any Person. Unless otherwise indicated in Schedule
4.4, all of the outstanding shares of capital stock, or all of the units
of equity interest, as the case may be, of each Subsidiary are owned of
record and beneficially by Borrower, there are no outstanding options,
warrants or other rights to purchase capital stock of any such
Subsidiary, and all such shares or equity interests so owned are duly
authorized, validly issued, fully paid and non-assessable, and were
issued in compliance with all applicable state and federal securities
and other Laws, and are free and clear of all Liens, except for
Permitted Encumbrances.
(b) Each Subsidiary is a legal entity of the type described in
Schedule 4.4 duly formed, 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
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Effect), and has all requisite power and authority to conduct its
business and to own and lease its Properties.
(c) Each 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, 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.
4.5 Financial Statements. Borrower has furnished to the Lenders (a)
the audited financial statements of Borrower for the Fiscal Year ended March 31,
2000 and (b) the unaudited balance sheet and statement of operations of Borrower
for the nine-month period ended December 31, 2000. The financial statements
described in clause (a) fairly present in all material respects the financial
condition, results of operations and changes in financial position, and the
balance sheet and statement of operations described in clause (b) fairly present
the financial condition and results of operations of Borrower as of such dates
and for such periods in conformity with GAAP consistently applied, subject only
to normal year-end accruals and audit adjustments.
4.6 No Other Liabilities; No Material Adverse Changes. Borrower and
its Subsidiaries do not have any material liability or material contingent
liability required under GAAP to be reflected or disclosed, and not reflected or
disclosed, in the balance sheet described in Section 4.5(b), other than
liabilities and contingent liabilities arising in the ordinary course of
business since the date of such financial statements. Except as set forth on
Schedule 4.6, as of the Closing Date, to the best of Borrower's knowledge, no
circumstance or event has occurred that constitutes a Material Adverse Effect
since December 31, 2000.
4.7 Intentionally Deleted.
4.8 Intangible Assets. Borrower and its Subsidiaries own, or possess
the right to use to the extent necessary in their respective businesses, all
material trademarks, trade names, copyrights, patents, patent rights, computer
software, licenses and other Intangible Assets that are used in the conduct of
their businesses as now operated, and no such Intangible Asset, to the best
knowledge of Borrower, 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. Except as set
forth in Schedule 4.8, Borrower has not used any trade name, trade style or
"dba" during the five year period ending on the Closing Date.
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4.9 Public Utility Holding Company Act. Neither Borrower nor any of
its Subsidiaries is a "holding company", or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company", within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
4.10 Litigation. Except for (a) any matter fully covered as to
subject matter and amount (subject to applicable deductibles and retentions) by
insurance for which the insurance carrier has not asserted lack of subject
matter coverage or reserved its right to do so, (b) any matter, or series of
related matters, involving a claim against Borrower or any of its Subsidiaries
of less than $1,000,000, (c) matters of an administrative nature not involving a
claim or charge against Borrower or any of its Subsidiaries and (d) matters set
forth in Schedule 4.10, there are no actions, suits, proceedings or
investigations pending as to which Borrower or any of its Subsidiaries have been
served or have received notice or, to the best knowledge of Borrower, threatened
against or affecting Borrower or any of its Subsidiaries or any Property of any
of them before any Governmental Agency.
4.11 Binding Obligations. Each of the Loan Documents to which
Borrower and any Subsidiary Guarantor 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.
4.12 No Default. No event has occurred and is continuing that is a
Default or Event of Default.
4.13 ERISA.
(a) With respect to each Pension Plan:
(i) such Pension Plan complies in all material respects with
ERISA and any other applicable Laws to the extent that
noncompliance could reasonably be expected to have a Material
Adverse Effect;
(ii) such Pension Plan has not incurred any "accumulated
funding deficiency" (as defined in Section 302 of ERISA) that
could reasonably be expected to have a Material Adverse Effect;
(iii) no "reportable event" (as defined in Section 4043 of
ERISA, but excluding such events as to which the PBGC has by
regulation waived the requirement therein contained that it be
notified within thirty days of the
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occurrence of such event) has occurred that could reasonably be
expected to have a Material Adverse Effect; and
(iv) neither Borrower nor any of its Subsidiaries has engaged
in any non-exempt "prohibited transaction" (as defined in Section
4975 of the Code) that could reasonably be expected to have a
Material Adverse Effect.
(b) Neither Borrower nor any of its Subsidiaries has incurred or
expects to incur any withdrawal liability to any Multiemployer Plan that
could reasonably be expected to have a Material Adverse Effect.
4.14 Regulation U; Investment Company Act. No part of the proceeds
of any Loan hereunder will be used to purchase or carry, or to extend credit to
others for the purpose of purchasing or carrying, any Margin Stock in violation
of Regulation U. Neither Borrower nor any of its Subsidiaries is or is required
to be registered as an "investment company" under the Investment Company Act of
1940.
4.15 Disclosure. No written statement made by a Senior Officer to
the Administrative Agent or any Lender in connection with this Agreement, or in
connection with any Loan, as of the date thereof contained any untrue statement
of a material fact or omitted a material fact necessary to make the statement
made not misleading in light of all the circumstances existing at the date the
statement was made.
4.16 Tax Liability. Borrower and its Subsidiaries have filed all tax
returns which 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 Borrower or
any of its Subsidiaries, except (a) such taxes, if any, as are being contested
in good faith by appropriate proceedings and as to which adequate reserves have
been established and maintained and (b) immaterial taxes so long as no material
Property of Borrower or any of its Subsidiaries is at impending risk of being
seized, levied upon or forfeited.
4.17 Projections. As of the Closing Date, to the best knowledge of
Borrower, the assumptions set forth in the Projections are reasonable and
consistent with each other and with all facts known to Borrower, and the
Projections are reasonably based on such assumptions. Nothing in this Section
4.17 shall be construed as a representation or covenant that the Projections in
fact will be achieved.
4.18 Hazardous Materials. Except as described in Schedule 4.18, as
of the Closing Date (a) neither Borrower nor any of its Subsidiaries at any time
has disposed of, discharged, released or threatened the release of any Hazardous
Materials on, from or under the Real Property in violation of any Hazardous
Materials Law that would individually or in the
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aggregate constitute a Material Adverse Effect, (b) to the best knowledge of
Borrower, no condition exists that violates any Hazardous Material Law affecting
any Real Property except for such violations that would not individually or in
the aggregate constitute a Material Adverse Effect, (c) no Real Property or any
portion thereof is or has been utilized by Borrower or any of its Subsidiaries
as a site for the manufacture of any Hazardous Materials and (d) to the extent
that any Hazardous Materials are used, generated or stored by Borrower or any of
its Subsidiaries on any Real Property, or transported to or from such Real
Property by Borrower or any of its Subsidiaries, such use, generation, storage
and transportation are in compliance with all Hazardous Materials Laws except
for such non-compliance that would not constitute a Material Adverse Effect or
be materially adverse to the interests of the Lenders.
4.19 Security Interests. Upon the execution and delivery of the
Security Agreement, the Security Agreement will create a valid first priority
security interest in the Collateral described therein securing the Obligations
(subject only to Permitted Encumbrances, Permitted Rights of Others and other
matters permitted by Section 6.9 and to such qualifications and exceptions as
are contained in the Uniform Commercial Code with respect to the priority of
security interests perfected by means other than the filing of a financing
statement or with respect to the creation of security interests in Property to
which Division 9 of the Uniform Commercial Code does not apply) and all actions
necessary to perfect the security interests so created, other than filing of the
UCC-1 financing statements delivered to the Administrative Agent pursuant to
Section 8.1 with the appropriate Governmental Agency, have been taken and
completed.
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Article 5.
AFFIRMATIVE COVENANTS
(OTHER THAN INFORMATION AND
REPORTING REQUIREMENTS)
So long as any Advance remains unpaid, or any other Obligation
remains unpaid, or any portion of the Commitment remains in force, Borrower
shall, and shall cause its Subsidiaries to, unless the Administrative Agent
(with the written approval of the Requisite Lenders) otherwise consents:
5.1 Payment of Taxes and Other Potential Liens. Pay and discharge
promptly all taxes, assessments and governmental charges or levies imposed upon
any of them, upon their respective Property or any part thereof and upon their
respective income or profits or any part thereof, except that Borrower and its
Subsidiaries shall not be required to pay or cause to be paid (a) any tax,
assessment, charge or levy that is not yet past due, or is being contested in
good faith by appropriate proceedings so long as the relevant entity has
established and maintains adequate reserves for the payment of the same or (b)
any immaterial tax so long as no material Property of Borrower or its
Subsidiaries is at impending risk of being seized, levied upon or forfeited.
5.2 Preservation of Existence. Preserve and maintain their
respective existences in the jurisdiction of their formation and all material
authorizations, rights, franchises, privileges, consents, approvals, orders,
licenses, permits, or registrations from any Governmental Agency that are
necessary for the transaction of their respective business and qualify and
remain qualified to transact business in each jurisdiction in which such
qualification is necessary in view of their respective business or the ownership
or leasing of their respective Properties except (a) a merger permitted by
Section 6.3 or as otherwise permitted by this Agreement and (b) where the
failure to so qualify or remain qualified would not constitute a Material
Adverse Effect. Notwithstanding the foregoing, Borrower may liquidate any
Subsidiary that does not constitute a Significant Subsidiary if such liquidation
would not have a Material Adverse Effect.
5.3 Maintenance of Properties. Maintain, preserve and protect all of
their respective Properties in good order and condition, subject to wear and
tear in the ordinary course of business, and not permit any waste of their
respective Properties, except that the failure to maintain, preserve and protect
a particular item of Property that is at the end of its useful life or that is
not of significant value, either intrinsically or to the operations of Borrower,
shall not constitute a violation of this covenant.
5.4 Maintenance of Insurance. Maintain liability, casualty, workers'
compensation and other insurance (subject to customary deductibles and
retentions) with responsible insurance companies in such amounts and against
such risks as is carried by responsible companies engaged in
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similar businesses and owning similar assets in the general areas in which
Borrower and its Subsidiaries operate.
5.5 Compliance With Laws. Comply with all Requirements of Law
noncompliance with which constitutes a Material Adverse Effect, except that
Borrower and its Subsidiaries need not comply with a Requirement of Law then
being contested by any of them in good faith by appropriate proceedings.
5.6 Inspection Rights. Upon reasonable notice, at any time during
regular business hours and as often as reasonably requested (but not so as to
materially interfere with the business of Borrower or any of its Subsidiaries)
permit the Administrative Agent or any Lender, or any authorized employee, agent
or representative thereof, at their own cost and expense prior to the occurrence
of an Event of Default, to examine, audit and make copies and abstracts from the
records and books of account of, and to visit and inspect the Properties of,
Borrower and its Subsidiaries and to discuss the affairs, finances and accounts
of Borrower and its Subsidiaries with any of their officers, key employees,
internal accountants and, following the occurrence of an Event of Default,
independent accountants. The Administrative Agent or any Lender, or any
authorized employee, agent or representative shall (i) comply with all sign-in
procedures for visitors, (ii) observe all general and safety, security, and
governmental regulations in effect at the site, and (iii) observe all rules
regarding restricted areas and restricted information as required by the United
States Department of Defense.
5.7 Keeping of Records and Books of Account. Keep adequate records
and books of account reflecting all financial transactions in conformity with
GAAP, consistently applied, and in material conformity with all applicable
requirements of any Governmental Agency having regulatory jurisdiction over
Borrower and its Subsidiaries.
5.8 Compliance With Agreements. Promptly and fully comply with all
Contractual Obligations to which any one or more of them is a party, except for
any such Contractual Obligations (a) the performance of which would cause a
Default or (b) then being contested by any of them in good faith by appropriate
proceedings or (c) if the failure to comply does not constitute a Material
Adverse Effect.
5.9 Use of Proceeds. Use the proceeds of all Revolving Loans for
working capital and general corporate purposes of Borrower, including repayment
of Indebtedness in connection with the Existing Credit Facilities, and use the
proceeds of the Term Loan solely to retire Indebtedness of Borrower and its
Subsidiaries and to implement any Permitted Acquisition.
5.10 Hazardous Materials Laws. Keep and maintain all Real Property
and each portion thereof in compliance in all material respects with all
applicable Hazardous Materials Laws and promptly notify the Administrative Agent
in writing (attaching a copy of any pertinent written
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material) of (a) any and all material enforcement, cleanup, removal or other
governmental or regula- tory actions instituted, completed or threatened in
writing by a Governmental Agency pursuant to any applicable Hazardous Materials
Laws, (b) any and all material claims made or threatened in writing by any
Person against Borrower relating to damage, contribution, cost recovery,
compensation, loss or injury resulting from any Hazardous Materials and (c)
discovery by any Senior Officer of any of Borrower of any material occurrence or
condition on any real Property adjoining or in the vicinity of such Real
Property that could reasonably be expected to cause such Real Property or any
part thereof to be subject to any restrictions on the ownership, occupancy,
transferability or use of such Real Property under any applicable Hazardous
Materials Laws.
5.11 Syndication Process. Cooperate in such respects as may be
reasonably requested by the Arranger in connection with the syndication of the
credit facilities under this Agreement, including the provision of information
(in form and substance acceptable to the Arranger but subject to confidentiality
provisions) for inclusion in written materials furnished to prospective
syndicate members and the participation by Senior Officers in meetings with
prospective syndicate members. Nothing in this Section 5.11 shall obligate
Borrower to amend any Loan Document.
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Article 6.
NEGATIVE COVENANTS
So long as any Advance remains unpaid, or any other Obligation
remains unpaid, or any portion of the Commitments remains in force, Borrower
shall not, and shall not permit any of its Subsidiaries to, unless the
Administrative Agent (with the written approval of the Requisite Lenders or, if
required by Section 11.2, of all of the Lenders) otherwise consents:
6.1 Payment of Subordinated Obligations. Pay any (a) principal
(including sinking fund payments) or any other amount (other than scheduled
interest payments) with respect to any Subordinated Obligation, or purchase or
redeem (or offer to purchase or redeem) any Subordinated Obligation, or deposit
any monies, securities or other Property with any trustee or other Person to
provide assurance that the principal or any portion thereof of any Subordinated
Obligation will be paid when due or otherwise to provide for the defeasance of
any Subordinated Obligation or (b) scheduled interest on any Subordinated
Obligation unless the payment thereof is then permitted pursuant to the terms of
the indenture or other agreement governing such Subordinated Obligation.
6.2 Disposition of Property. Make any Disposition of its Property,
whether now owned or hereafter acquired, except (a) a Disposition by Borrower to
a Wholly-Owned Subsidiary, or by a Subsidiary to Borrower or a Wholly-Owned
Subsidiary and (b) a Disposition for which the Net Cash Sales Proceeds do not
exceed $5,000,000 or when added to the aggregate Net Cash Sales Proceeds of all
Dispositions made during the term of this Agreement do not exceed $10,000,000.
6.3 Mergers. Merge or consolidate with or into any Person, except
(a) mergers and consolidations of a Subsidiary of Borrower into Borrower or a
Wholly-Owned Subsidiary, or of Subsidiaries with each other and (b) a merger or
consolidation of a Person into Borrower or with or into a Wholly-Owned
Subsidiary of Borrower which constitutes a Permitted Acquisition; provided that
(i) Borrower is the surviving entity of any merger to which it is a party, (ii)
no Default or Event of Default then exists or would result therefrom and (iii)
Borrower and each of the Subsidiary Guarantors execute such amendments to the
Loan Documents as the Administrative Agent may reasonably determine are
appropriate as a result of such merger in order to preserve the enforceability
of the Loan Documents on the parties thereto and their successors, if any, and
maintain the perfection of the Administrative Agent's Liens on the Collateral.
6.4 Hostile Acquisitions. Directly or indirectly use the proceeds of
any Loan in connection with the acquisition of part or all of a voting interest
of five percent (5%) or more in any corporation or other business entity if such
acquisition is opposed by the board of directors of such corporation or business
entity.
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6.5 Acquisitions. Make any Acquisition other than a Permitted
Acquisition.
6.6 Distributions. Make any Distribution, whether from capital,
income or otherwise, and whether in Cash or other Property, except:
(a) Distributions by any Subsidiary to Borrower or to any
Wholly-Owned Subsidiary; and
(b) stock dividends payable on Common Stock.
6.7 ERISA. At any time, permit any Pension Plan to: (i) engage in
any non-exempt "prohibited transaction" (as defined in Section 4975 of the
Code); (ii) fail to comply with ERISA or any other applicable Laws; (iii) incur
any material "accumulated funding deficiency" (as defined in Section 302 of
ERISA); or (iv) terminate in any manner, which, with respect to each event
listed above, could reasonably be expected to result in a Material Adverse
Effect or (b) withdraw, completely or partially, from any Multiemployer Plan if
to do so could reasonably be expected to result in a Material Adverse Effect.
6.8 Change in Nature of Business. Make any material change in the
nature of the business of the Parent and its Subsidiaries, taken as a whole.
6.9 Liens. Create, incur, assume or suffer to exist any Lien of any
nature upon or with respect to any of their respective Properties, or engage in
any sale and leaseback transaction with respect to any of their respective
Properties, whether now owned or hereafter acquired, except:
(a) Liens existing on the Closing Date and disclosed in Schedule
6.9 and any renewals/extensions or amendments thereof, provided that the
obligations secured or benefitted thereby are not increased;
(b) Liens in favor of the Administrative Agent pursuant to the
Security Agreement.
(c) Permitted Encumbrances;
(d) Liens on personal property acquired by Borrower or any of its
Subsidiaries that were in existence at the time of the acquisition of
such Property and were not created in contemplation of such acquisition;
(e) Liens on real property acquired by Borrower or any of its
Subsidiaries for use in the business of Borrower or such Subsidiary;
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(f) Liens securing Indebtedness, in an aggregate outstanding
principal amount at any time of not more than $3,000,000, permitted by
Section 6.10(d) on and limited to the capital assets acquired,
constructed or financed with the proceeds of such Indebtedness or with
the proceeds of any Indebtedness directly or indirectly refinanced by
such Indebtedness; and
(g) Non-consensual Liens securing Indebtedness of not more than
$500,000, provided that such Liens are discharged within thirty (30)
days after their incurrence by Borrower.
6.10 Indebtedness and Guaranty Obligations. Create, incur or assume
any Indebtedness or Guaranty Obligation except:
(a) Indebtedness and Guaranty Obligations existing on the Closing
Date and disclosed in Schedule 6.10, and refinancings, renewals,
extensions or amendments that do not increase the amount thereof;
(b) Indebtedness and Guaranty Obligations under the Loan
Documents;
(c) Indebtedness and Guaranty Obligations owed to Borrower or any
of its Subsidiaries;
(d) Indebtedness consisting of Capital Lease Obligations, or
otherwise incurred to finance the purchase or construction of property
or assets (which shall be deemed to exist if the Indebtedness is
incurred at or within 90 days before or after the purchase or
construction of the property or assets), or to refinance any such
Indebtedness, provided that the principal amount of such Indebtedness
incurred does not exceed $3,000,000 in the aggregate at any time.
(e) Indebtedness incurred to finance the purchase or construction
of real property used in the business of Borrower or any of its
Subsidiaries;
(f) Subordinated Obligations in such amount as may be approved in
writing by the Requisite Lenders, except as expressly provided in this
Agreement;
(g) Indebtedness consisting of debt securities for which the Net
Cash Issuance Proceeds will be applied as a mandatory prepayment
pursuant to Section 3.1(f);
(h) Indebtedness consisting of Interest Rate Protection
Agreements; and
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(i) Guaranty Obligations in support of the obligations of a
Wholly-Owned Subsidiary, provided that such obligations are not
prohibited by this Agreement.
6.11 Transactions with Affiliates. Enter into any transaction of any
kind with any Affiliate of Borrower other than (a) salary, bonus, employee stock
option and other compensation arrangements with directors or officers in the
ordinary course of business, (b) transactions that are fully disclosed to the
board of directors (or executive committee thereof) of Borrower and expressly
authorized by a resolution of the board of directors (or executive committee) of
Borrower which is approved by a majority of the directors (or executive
committee) not having an interest in the transaction, (c) transactions between
or among Borrower and its Subsidiaries and (d) transactions on overall terms at
least as favorable to Borrower or its Subsidiaries as would be the case in an
arm's-length transaction between unrelated parties of equal bargaining power.
Except as set forth in Schedule 6.11, without limiting the generality of the
preceding sentence, in no event shall Borrower pay, or permit any of its
Subsidiaries to pay, management fees or fees for services to any Affiliate of
Borrower without the prior written approval of the Administrative Agent.
6.12 Leverage Ratio. Permit the Leverage Ratio as of the last day of
any Fiscal Quarter to be greater than (***).
6.13 EBITDA. Permit EBITDA for any Fiscal Quarter, commencing with
the Fiscal Quarter ending June 30, 2001 to be less than (***).
6.14 Tangible Net Worth. Permit Tangible Net Worth as of the Closing
Date to be less than (***) or permit Tangible Net Worth as of the last day of
each Fiscal Quarter ending thereafter during the term of this Agreement to be
less than the sum of: (a) (***); (b) 90% of the cumulative Net Income for the
Fiscal Quarter ending September 30, 2001 and for each Fiscal Quarter ending
thereafter (with no deduction for a net loss in any such Fiscal Quarter); and
(c) 100% of the proceeds of any issuance by Borrower of equity securities
(except to employees or former employees of Borrower pursuant to an employee
stock option plan maintained by Borrower) subsequent to the Closing Date.
6.15 Quick Ratio. Permit the Quick Ratio as of the last day of any
Fiscal Quarter to be less than (***);
6.16 Investments. Make or suffer to exist any Investment, other
than:
(a) Investments in existence on the Closing Date and disclosed on
Schedule 6.16;
(b) Investments consisting of Cash Equivalents;
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(c) Investments in a Person that is the subject of the
Acquisition permitted by Section 6.5;
(d) Investments consisting of advances to officers, directors and
employees of a Borrower or of any Subsidiary for travel, entertainment,
relocation, anticipated bonus and analogous ordinary business purposes;
(e) Investments in a Domestic Subsidiary that is a Wholly-Owned
Subsidiary;
(f) Investments in a Foreign Subsidiary that is a Wholly-Owned
Subsidiary and Investments in Joint Ventures; provided that (i) the
aggregate of such Investments in Immeon Networks LLC, a Delaware limited
liability company, in any Fiscal Year does not exceed (***), (ii) the
aggregate of such Investments in Trellisware Technologies, Inc., a
Delaware corporation, in any Fiscal Year does not exceed (***), and
(iii) the aggregate of all such Investments in all Foreign Subsidiaries
and Joint Ventures in any Fiscal Year does not exceed (***);
(g) Investments consisting of the extension of credit to
customers or suppliers of Borrower and its Subsidiaries in the ordinary
course of business and any Investments received in satisfaction or
partial satisfaction thereof;
(h) Investments received in connection with the settlement of a
bona fide dispute with another Person;
(i) Investments representing all or a portion of the sales price
of Property sold or services provided to another Person;
(j) Investments by Foreign Subsidiaries in any other Subsidiary
of a Borrower (whether a Domestic Subsidiary or a Foreign Subsidiary);
and
(k) Investments not described above not in excess of $5,000,000
in any Fiscal Year.
6.17 Capital Expenditures. Make any Capital Expenditure in any
Fiscal Year, if to do so would result in the aggregate Capital Expenditures made
in such Fiscal Year (exclusive of Capital Expenditures made in connection with
Permitted Acquisitions) to exceed (***).
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6.18 Amendments to Subordinated Obligations. Amend or modify any
term or provision of any indenture, agreement or instrument evidencing or
governing any Subordinated Obligation in any respect that will or may have a
Material Adverse Effect.
6.19 Changes in Officers, Name, Location of Chief Executive Offices,
Etc. Without providing notification to the Administrative Agent, make any change
in the executive officers or other senior management of Borrower or the
corporate name of Borrower, or without providing ten (10) calendar days prior
written notice to the Administrative Agent, make any change in the location of
Borrower's material assets, principal place of business or chief executive
office.
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Article 7.
INFORMATION AND REPORTING REQUIREMENTS
7.1 Financial and Business Information. So long as any Advance
remains unpaid, or any other Obligation remains unpaid, or any portion of the
Commitments remains in force, Borrower shall, unless the Administrative Agent
(with the written approval of the Requisite Lenders) otherwise consents, at
Borrower's sole expense, deliver to the Administrative Agent for distribution by
it to the Lenders, a sufficient number of copies for all of the Lenders of the
following:
(a) As soon as practicable, and in any event within 50 days after
the end of each Fiscal Quarter (other than the fourth Fiscal Quarter in
any Fiscal Year), the consolidated and consolidating balance sheet of
Borrower and its Subsidiaries as at the end of such Fiscal Quarter and
the consolidated and consolidating statements of operations and cash
flows for such Fiscal Quarter, and the portion of the Fiscal Year ended
with such Fiscal Quarter, all in reasonable detail. Such financial
statements shall be certified by the chief financial officer of Borrower
or his or her designated representative as fairly presenting the
financial condition, results of operations and cash flows of Borrower
and its Subsidiaries in accordance with GAAP (other than footnote
disclosures), consistently applied, as at such date and for such
periods, subject only to normal year-end accruals and audit adjustments;
(b) As soon as practicable, and in any event within 45 days after
the end of each Fiscal Quarter, a Pricing Certificate setting forth a
calculation of the Leverage Ratio as of the last day of such Fiscal
Quarter, and providing reasonable detail as to the calculation thereof,
which calculations in the case of the fourth Fiscal Quarter in any
Fiscal Year shall be based on the preliminary unaudited financial
statements of Borrower and its Subsidiaries for such Fiscal Quarter, and
as soon as practicable thereafter, in the event of any material variance
in the actual calculation of the Leverage Ratio from such preliminary
calculation, a revised Pricing Certificate setting forth the actual
calculation thereof;
(c) As soon as practicable, and in any event within 120 days
after the end of each Fiscal Year, the consolidated and consolidating
balance sheet of Borrower and its Subsidiaries as at the end of such
Fiscal Year and the consolidated and consolidating statements of
operations, stockholders' equity and cash flows, in each case of
Borrower and its Subsidiaries for such Fiscal Year, all in reasonable
detail. Such financial statements shall be prepared in accordance with
GAAP, consistently applied, and such consolidated financial statements
shall be accompanied by a report of Pricewaterhouse Coopers LLP or other
independent public accountants of recognized standing selected by
Borrower and reasonably satisfactory to the Requisite Lenders, which
report shall be prepared in accordance with generally accepted auditing
standards as at such date, and shall not be subject to any
qualifications or exceptions as to the scope of the audit nor to any
other
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qualification or exception determined by the Requisite Lenders in their
good faith business judgment to be adverse to the interests of the
Lenders;
(d) As soon as practicable, and in any event not later than
thirty (30) days prior to the commencement of each Fiscal Year, a budget
and projection by Fiscal Quarter for that Fiscal Year and by Fiscal Year
for the next succeeding Fiscal Year, including for the first such Fiscal
Year, projected consolidated balance sheets, statements of operations
and statements of cash flow, forecast assumptions, and a budget for
Capital Expenditures, and, for the second such Fiscal Year, projected
consolidated condensed balance sheets and statements of operations and
cash flows of Borrower and its Subsidiaries, forecast assumptions, and
a budget for Capital Expenditures, all in reasonable detail;
(e) As soon as practicable, and in any event not later than
forty-five (45) days after the end of each month, an aging of Borrower's
accounts receivable in form and substance reasonably acceptable to the
Administrative Agent;
(f) Promptly after request by the Administrative Agent or any
Lender, copies of any detailed audit reports by independent accountants
in connection with the accounts or books of Borrower or any of its
Subsidiaries, or any audit of any of them;
(g) Promptly after the same are available, and in any event
within five (5) Banking Days after filing with the Securities and
Exchange Commission, copies of each annual report, proxy or financial
statement or other report or communication sent to the stockholders of
Borrower, and copies of all annual, regular, periodic and special
reports and registration statements which Borrower may file or be
required to file with the Securities and Exchange Commission under
Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended,
and not otherwise required to be delivered to the Lenders pursuant to
other provisions of this Section 7.1;
(h) Promptly after request by the Administrative Agent or any
Lender, copies of any other report or other document that was filed by
Borrower with any Governmental Agency, but excluding such reports or
documents as are filed with any Governmental Agency as part of
Borrower's ordinary course transactions with any Governmental Agency;
(i) Promptly upon a Senior Officer becoming aware, and in any
event within five (5) Banking Days after becoming aware, of the
occurrence of any (i) "reportable event" (as such term is defined in
Section 4043 of ERISA, but excluding such events as to which the PBGC
has by regulation waived the requirement therein contained that it be
notified within thirty days of the occurrence of such event) or (ii)
non-exempt "prohibited transaction" (as such term is defined in Section
406 of ERISA or Section 4975 of the Code)
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involving any Pension Plan or any trust created thereunder, telephonic
notice specifying the nature thereof, and, no more than two (2) Banking
Days after such telephonic notice, written notice again specifying the
nature thereof and specifying what action Borrower is taking or proposes
to take with respect thereto, and, when known, any action taken by the
Internal Revenue Service with respect thereto;
(j) As soon as practicable, and in any event within five (5)
Banking Days after a Senior Officer becomes aware of the existence of
any condition or event which constitutes a Default or Event of Default,
telephonic notice specifying the nature and period of existence thereof,
and, no more than five (5) Banking Days after such telephonic notice,
written notice again specifying the nature and period of existence
thereof and specifying what action Borrower is taking or proposes to
take with respect thereto;
(k) Promptly upon a Senior Officer becoming aware that (i) any
Person has commenced a legal proceeding with respect to a claim against
Borrower that is $3,000,000 or more in excess of the amount thereof that
is fully covered by insurance, (ii) any creditor under a credit
agreement involving Indebtedness of $1,000,000 or more or any lessor
under a lease involving aggregate rent of $1,000,000 or more has
asserted a default thereunder on the part of Borrower or, (iii) any
Person has commenced a legal proceeding with respect to a claim against
Borrower under a contract that is not a credit agreement or material
lease with respect to a claim of in excess of $3,000,000 or which
otherwise may reasonably be expected to result in a Material Adverse
Effect, a written notice describing the pertinent facts relating thereto
and what action Borrower is taking or proposes to take with respect
thereto; and
(l) Such other data and information as from time to time may be
reasonably requested by the Administrative Agent, any Lender (through
the Administrative Agent) or the Requisite Lenders, to the extent
reasonably available to Borrower.
7.2 Compliance Certificates. So long as any Advance remains unpaid,
or any other Obligation remains unpaid or unperformed, or any portion of the
Commitments remains outstanding, Borrower shall, at Borrower's sole expense,
deliver to the Administrative Agent for distribution by it to the Lenders
concurrently with the financial statements required pursuant to Sections 7.1(a)
and 7.1(c), a Compliance Certificate signed by a Senior Officer or his or her
designated representative.
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Article 8.
CONDITIONS
8.1 Initial Credit Issuance. The obligation of each Lender to make
the initial Credit Issuance is subject to the following conditions precedent,
each of which shall be satisfied prior to the making of the initial Advances
(unless all of the Lenders, in their sole and absolute discretion, shall agree
otherwise):
(a) The Administrative Agent shall have received all of the
following, each of which shall be originals 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):
(1) at least one (1) executed counterpart of this Agreement,
together with arrangements satisfactory to the Administrative Agent
for additional executed counterparts, sufficient in number for
distribution to the Lenders and Borrower;
(2) Revolving Notes executed by Borrower in favor of each
Lender, each in a principal amount equal to that Lender's Pro Rata
Share of the Revolving Commitment;
(3) Term Notes executed by Borrower in favor of each Lender,
each in a principal amount equal to that Lender's Pro Rata Share of
the Term Commitment;
(4) the Subsidiary Guaranty executed by the Subsidiary
Guarantors;
(5) the Security Agreement executed by Borrower and the
Subsidiary Guarantors;
(6) such financing statements on Form UCC-1 executed by
Borrower and the Subsidiary Guarantors with respect to the Security
Agreement as the Administrative Agent may request;
(7) with respect to Borrower and the Subsidiary Guarantors,
such documentation as the Administrative Agent may reasonably
require to establish
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the due organization, valid existence and good standing of Borrower
and the Subsidiary Guarantors, their qualification to engage in
business in each material jurisdiction in which they are engaged
in business or required to be so qualified, their authority to
execute, deliver and perform the Loan Documents to which they are a
Party, the identity, authority and capacity of each Responsible
Official thereof authorized to act on their behalf, including
certified copies of articles or certificates of incorporation and
amendments thereto, bylaws and amendments thereto, certificates of
good standing and/or qualification to engage in business, tax
clearance certificates, certificates of corporate resolutions,
incumbency certificates, Certificates of Responsible Officials, and
the like;
(8) the Opinion of Counsel;
(9) a Certificate of Borrower, signed by the chief financial
officer of Borrower or his or her designated representative,
certifying that the representation contained in Section 4.17 is, to
the best of his or her knowledge, true and correct;
(10) a Certificate of Borrower, executed by the chief
financial officer of Borrower or his or her designated
representative, certifying that the conditions specified in Sections
8.1(f) and 8.1(g) have been satisfied;
(11) a preliminary opening balance sheet for Borrower and its
Subsidiaries, in form and substance acceptable to the Administrative
Agent; and
(12) such other assurances, certificates, documents, consents
or opinions as the Administrative Agent or the Requisite Lenders
reasonably may require.
(b) The fees payable on the Closing Date pursuant to Section 3.2
shall have been paid.
(c) All Indebtedness outstanding under the Existing Credit
Agreement shall have been (or shall concurrently be) paid and the same
shall, together with all Liens securing such Indebtedness, have been (or
shall concurrently be) terminated.
(d) The Administrative Agent shall be reasonably satisfied that,
upon the filing of the financing statements described in Section
8.1(a)(8) with the appropriate Governmental Agencies, the Administrative
Agent will hold a first priority perfected Lien in the Collateral, for
the ratable benefit of the Lenders, subject only to Permitted
Encumbrances.
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(e) The reasonable costs and expenses of the Administrative Agent
in connection with the preparation of the Loan Documents payable
pursuant to Section 11.3, and invoiced to Borrower prior to the Closing
Date (if applicable), shall have been (or shall concurrently be) paid.
(f) The representations and warranties of Borrower contained in
Article 4 shall be true and correct in all material respects.
(g) Borrower and any other Parties shall be in compliance with
all the terms and provisions of the Loan Documents, and giving effect to
the initial Credit Issuance, no Default or Event of Default shall have
occurred and be continuing.
(h) All legal matters relating to the Loan Documents shall be
reasonably satisfactory to Sheppard, Mullin, Richter & Hampton LLP,
special counsel to the Administrative Agent.
(i) The Closing Date shall have occurred on or before June 30,
2001.
8.2 Any Advance. The obligation of each Lender to make any Advance,
and the obligation of the Issuing Lender to issue any Letter of Credit, is
subject to the following conditions precedent (unless the Requisite Lenders, in
their reasonable discretion, shall agree otherwise):
(a) except (i) for representations and warranties which expressly
speak as of a particular date or are no longer true and correct as a
result of a change which is permitted by this Agreement or (ii) as
disclosed by Borrower and approved in writing by the Requisite Lenders,
the representations and warranties contained in Article 4 (other than
Sections 4.4, 4.6 (first sentence), 4.10 and 4.17) shall be true and
correct in all material respects on and as of the date of the Advance as
though made on that date;
(b) no circumstance or event shall have occurred that constitutes
a Material Adverse Effect since the Closing Date;
(c) other than matters described in Schedule 4.10 or not required
as of the Closing Date to be therein described, there shall not be then
pending or threatened any action, suit, proceeding or investigation
against or affecting Borrower or any of its Subsidiaries or any Property
of any of them before any Governmental Agency that constitutes a
Material Adverse Effect; and
(d) the Administrative Agent shall have timely received a Request
for Loan (or telephonic or other request for Loan referred to in the
second sentence of
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Section 2.1(c), if applicable), or a Request for Letter of Credit (as
applicable), in compliance with Article 2.
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Article 9.
EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT
9.1 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) Borrower fails to pay any principal on any of the Notes, or
any portion thereof, within five (5) days after the date when due; or
(b) Borrower fails to pay any interest on any of the Notes, or
any fees under Sections 3.3, 3.4 or 3.5, or any portion thereof, within
two (2) Banking Days after the date when due; or fails to pay any other
fee or amount payable to the Lenders under any Loan Document, or any
portion thereof, within two (2) Banking Days after demand therefor; or
(c) Borrower fails to comply with any of the covenants contained
in Article 6 (other than Sections 6.8, 6.11, or 6.16); or
(d) Borrower fails to comply with Section 7.1(i) in any respect
that has a Material Adverse Effect; or
(e) Borrower or any other Party fails to perform or observe any
other covenant or agreement (not specified in clause (a), (b), (c) or
(d) above) contained in any Loan Document on its part to be performed or
observed within twenty (20) Banking Days after the giving of notice by
the Administrative Agent on behalf of the Requisite Lenders of such
Default or, if such Default is not reasonably susceptible of cure within
such period, within such longer period as is reasonably necessary to
effect a cure so long as such Borrower or such Party continues to
diligently pursue cure of such Default but not in any event in excess of
forty (40) Banking Days; or
(f) Any representation or warranty of Borrower or any other Party
made in any Loan Document, or in any certificate or other writing
delivered by Borrower or such Party pursuant to any Loan Document,
proves to have been incorrect when made or reaffirmed in any respect has
a Material Adverse Effect; or
(g) Borrower (i) fails to pay the principal, or any principal
installment, of any present or future Indebtedness of $500,000 or more,
or any guaranty of present or future Indebtedness of $500,000 or more,
on its part to be paid, when due (or within any stated grace period),
whether at the stated maturity, upon acceleration, by reason of
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required prepayment or otherwise or (ii) fails to perform or observe any
other term, covenant or agreement on its part to be performed or
observed, or suffers any event of default to occur, in connection with
any present or future Indebtedness of $500,000 or more, or of any
guaranty of present or future Indebtedness of $500,000 or more, if as a
result of such failure or sufferance any holder or holders thereof (or
an agent or trustee on its or their behalf) has the right to declare
such Indebtedness due before the date on which it otherwise would become
due or the right to require Borrower to redeem or purchase, or offer to
redeem or purchase, all or any portion of such Indebtedness; or
(h) Any Loan Document, at any time after its execution and
delivery and for any reason other than the agreement or action (or
omission to act) of the Administrative Agent or the Lenders or
satisfaction in full of all the Obligations, ceases to be in full force
and effect or is declared by a court of competent jurisdiction to be
null and void, invalid or unenforceable in any respect which has a
Material Adverse Effect; or any Collateral Document ceases (other than
by action or inaction of the Administrative Agent or any Lender) to
create a valid and effective Lien in any material portion of the
Collateral; or any Party thereto denies in writing that it has any or
further liability or obligation under any Loan Document, or purports to
revoke, terminate or rescind same; or
(i) A final judgment against Borrower is entered for the payment
of money in excess of $3,000,000 (not covered by insurance or for which
an insurer has reserved its rights) and, absent procurement of a stay of
execution, such judgment remains unsatisfied for thirty (30) calendar
days after the date of entry of judgment, or in any event later than
five (5) days prior to the date of any proposed sale thereunder; or any
writ or warrant of attachment or execution or similar process is issued
or levied against all or any material part of the Property of Borrower
and is not released, vacated or fully bonded within thirty (30) calendar
days after its issue or levy; or
(j) Borrower institutes or consents to the institution of any
proceeding under a Debtor Relief Law relating to it or to all or any
material part of its Property, or is unable or admits in writing its
inability to pay its debts as they mature, or makes an assignment for
the benefit of creditors; or applies for or consents to the appointment
of any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer for it or for all or any material part
of its Property; or any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is appointed without the
application or consent of that Person and the appointment continues
undischarged or unstayed for sixty (60) calendar days; or any proceeding
under a Debtor Relief Law relating to any such Person or to all or any
part of its Property is instituted without the consent of that Person
and continues undismissed or unstayed for sixty (60) calendar days; or
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(k) The occurrence of an Event of Default (as such term is or may
hereafter be specifically defined in any other Loan Document) under any
other Loan Document; or
(l) Any holder of a Subordinated Obligation of more than
$1,000,000 asserts in writing that such Subordinated Obligation is not
subordinated to the Obligations in accordance with its terms and
Borrower does not promptly deny in writing such assertion and contest
any attempt by such holder to take action based on such assertion; or
(m) Any Pension Plan maintained by Borrower is finally determined
by the PBGC to have a material "accumulated funding deficiency" as that
term is defined in Section 302 of ERISA in excess of an amount equal to
5% of the consolidated total assets of Borrower as of the most-recently
ended Fiscal Quarter; or
(n) The Requisite Lenders reasonably determine in good faith that
a circumstance or event has occurred that constitutes a Material Adverse
Effect; or
(o) A Change in Control occurs.
9.2 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 other Loan Documents, or by applicable Law,
or in equity, or otherwise:
(a) Upon the occurrence, and during the continuance, of any Event
of Default other than an Event of Default described in Section 9.1(j):
(1) the Commitments to make Advances and all other
obligations of the Administrative Agent or the Lenders and all
rights of Borrower and any other Parties under the Loan Documents
shall be suspended without notice to or demand upon Borrower, which
are expressly waived by Borrower, except that all of the Lenders or
the Requisite Lenders (as the case may be, in accordance with
Section 11.2) may waive an Event of Default or, without waiving,
determine, upon terms and conditions satisfactory to the Lenders or
Requisite Lenders, as the case may be, to reinstate the Commitments
and such other obligations and rights and make further Advances,
which waiver or determination shall apply equally to, and shall be
binding upon, all the Lenders;
(2) the Issuing Lender may, with the approval of the
Administrative Agent on behalf of the Requisite Lenders, demand
immediate payment by Borrower of an amount equal to the aggregate
amount of all outstanding
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Letters of Credit to be held by the Issuing Lender in an
interest-bearing cash collateral account as collateral hereunder;
and
(3) the Requisite Lenders may request the Administrative
Agent to, and the Administrative Agent thereupon shall, terminate
the Commitments and/or declare all or any part of the unpaid
principal of all Notes, all interest accrued and unpaid thereon and
all other amounts payable under the Loan Documents to be forthwith
due and payable, whereupon the same shall become and be forthwith
due and payable, without protest, presentment, notice of dishonor,
demand or further notice of any kind, all of which are expressly
waived by Borrower.
(b) Upon the occurrence of any Event of Default described in
Section 9.1(j):
(1) the Commitments to make Advances and all other
obligations of the Administrative Agent or the Lenders and all
rights of Borrower and any other Parties under the Loan Documents
shall terminate without notice to or demand upon Borrower, which are
expressly waived by Borrower, except that all of the Lenders may
waive the Event of Default or, without waiving, determine, upon
terms and conditions satisfactory to all the Lenders, to reinstate
the Commitments and such other obligations and rights and make
further Advances, which determination shall apply equally to, and
shall be binding upon, all the Lenders;
(2) an amount equal to the aggregate amount of all
outstanding Letters of Credit shall be immediately due and payable
to the Issuing Lender without notice to or demand upon Borrower,
which are expressly waived by Borrower, to be held by the Issuing
Lender in an interest-bearing cash collateral account as collateral
hereunder; and
(3) the unpaid principal of all Notes, all interest accrued
and unpaid thereon and all other amounts payable under the Loan
Documents shall be forthwith due and payable, without protest,
presentment, notice of dishonor, demand or further notice of any
kind, all of which are expressly waived by Borrower.
(c) Upon the occurrence of any Event of Default, the Lenders and
the Administrative Agent, or any of them, without notice to (except as
expressly provided for in any Loan Document) or demand upon Borrower,
which are expressly waived by Borrower (except as to notices expressly
provided for in any Loan Document), may proceed (but only with the
consent of the Requisite Lenders) to protect, exercise and enforce their
rights and remedies under the Loan Documents against Borrower and any
other Party and such other rights and remedies as are provided by Law or
equity.
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(d) The order and manner in which the Lenders' rights and
remedies are to be exercised shall be determined by the Requisite
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 reasonable attorneys' fees
and disbursements and the reasonably allocated costs of attorneys
employed by the Administrative Agent or by any Lender) of the
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 Borrower's Obligations hereunder and under the
Notes, payments shall be applied first, to the costs and expenses of 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 (other than an Event of Default
caused by a failure to pay), 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 10.
THE ADMINISTRATIVE AGENT
10.1 Appointment and Authorization. Subject to Section 10.8, each
Lender hereby irrevocably appoints and authorizes the Administrative Agent to
take such action as agent on its 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, as determined by the Administrative Agent,
thereto. This appointment and authorization is intended solely for the purpose
of facilitating the servicing of the Loans 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 take such action
and exercise such powers only in an administrative and ministerial capacity.
10.2 Administrative Agent and Affiliates. Union Bank of California,
N.A. (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, and the term "Lender" or "Lenders"
includes Union Bank of California, N.A. in its individual capacity. Union Bank
of California, N.A. (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 Borrower, any Subsidiary thereof, or any
Affiliate of Borrower or any Subsidiary thereof, as if it were not the
Administrative Agent and without any duty to account therefor to the Lenders.
Union Bank of California, N.A. (and each successor Administrative Agent) need
not account to any other Lender for any monies received by it for reimbursement
of its costs and expenses as Administrative Agent hereunder, or (subject to
Section 11.10) for any monies received by it in its capacity as a Lender
hereunder. The Administrative Agent shall not be deemed to hold a fiduciary
relationship with any Lender and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or otherwise exist against the Administrative Agent.
10.3 Proportionate Interest 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
reasonable attorneys' fees and disbursements and other professional services and
the reasonably allocated costs of attorneys employed by the Administrative Agent
or a Lender) and subject to the application of payments in accordance with
Section 9.2(d), each Lender shall have an interest in the Lenders' interest in
such collateral or 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.
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10.4 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 of any other Lender, and instead in reliance upon
information supplied to it by or on behalf of Borrower 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 of any other Lender, continue to make its own
independent credit analyses and decisions in acting or not acting under the Loan
Documents.
10.5 Action by Administrative Agent.
(a) Absent actual knowledge of the Administrative Agent of the
existence of a Default, the Administrative Agent may assume that no
Default has occurred and is continuing, unless the Administrative Agent
(or the Lender that is then the Administrative Agent) has received
notice from Borrower stating the nature of the Default or has received
notice from a Lender stating the nature of the 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
Event of Default has occurred and is continuing, the Administrative
Agent may, but shall not be required to, exercise its reasonable
discretion to act or not act, except that the Administrative Agent shall
be required to act or not act upon the instructions of the Requisite
Lenders (or of all the Lenders, to the extent required by Section 11.2)
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 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 clause (a), the Administrative Agent shall immediately give notice
thereof to the Lenders and shall act or not act upon the instructions of
the Requisite Lenders (or of all the Lenders, to the extent required by
Section 11.2), 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 substantial risk of liability
to the Administrative Agent, and except that if the Requisite Lenders
(or all the Lenders, if required under Section 11.2) fail, for five (5)
Banking Days
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after the receipt of notice from the Administrative Agent, to instruct
the Administrative Agent, then the Administrative Agent, in its sole
discretion, may act or not act as it deems advisable for the protection
of the interests of the Lenders.
(e) The Administrative Agent shall have no liability to any
Lender for acting, or not acting, as instructed by the Requisite Lenders
(or all the Lenders, if required under Section 11.2), notwithstanding
any other provision hereof.
10.6 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 in-house legal
counsel), accountants (including in-house accountants) and other
professionals or experts selected by it, or with legal counsel,
accountants or other professionals or experts for Borrower and/or their
Subsidiaries or the Lenders, and shall not be liable for any action
taken or not taken by it in good faith in accordance with any reasonable
advice of such legal counsel, accountants or other professionals or
experts selected by it with reasonable care;
(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 except
for those expressly made by it;
(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 Borrower or its Subsidiaries of any of the terms,
conditions or covenants of any of the Loan Documents or to inspect any
collateral or any Property, books or records of Borrower 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
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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 reasonably believed by
it to be genuine and signed or sent by the proper party or parties; and
(g) Will not incur any liability for any arithmetical error in
computing any amount paid or payable by Borrower 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, commitment fees, Advances and other amounts;
provided that such error was not the result of gross negligence or
wilful misconduct and provided further that, promptly upon discovery of
such an error in computation, the Administrative Agent, the Lenders and
(to the extent applicable) Borrower and/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.
10.7 Indemnification. Each Lender shall, ratably in accordance with
its Pro Rata Share of the Commitments (if the Commitments are then in effect) or
in accordance with its proportion of the aggregate Indebtedness then evidenced
by the Notes (if the Commitments have then been terminated), indemnify and hold
the Administrative Agent and its directors, officers, agents, employees and
attorneys harmless against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever (including reasonable attorneys' fees and
disbursements and allocated costs of attorneys employed by the Administrative
Agent) 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 Borrower 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 Pro Rata Share of any
reasonable out-of-pocket 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
Borrower or any other Party is required by Section 11.3 to pay that cost or
expense but fails to do so upon demand. Nothing in this Section 10.7 shall
entitle the Administrative Agent or any indemnitee referred to above to recover
any amount from the Lenders if and to the extent that such amount has
theretofore been recovered from Borrower or any of its Subsidiaries. To the
extent that the Administrative Agent or any indemnitee referred to above is
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later reimbursed such amount by Borrower or any of its Subsidiaries, it shall
return the amounts paid to it by the Lenders in respect of such amount.
10.8 Successor Administrative Agent. The Administrative Agent may,
and at the request of the Requisite Lenders shall, resign as Administrative
Agent upon reasonable notice to the Lenders and Borrower effective upon
acceptance of appointment by a successor Administrative Agent. If the
Administrative Agent shall resign as Administrative Agent under this Agreement,
the Requisite Lenders shall appoint from among the Lenders a successor
Administrative Agent for the Lenders, which successor Administrative Agent shall
be approved by Borrower (and such approval shall not be unreasonably withheld or
delayed). If no successor Administrative Agent is appointed prior to the
effective date of the resignation of the Administrative Agent, the
Administrative Agent may appoint, after consulting with the Lenders and
Borrower, a successor Administrative Agent from among the Lenders. Upon the
acceptance of its appointment as successor Administrative Agent hereunder, such
successor Administrative Agent shall succeed to all the rights, powers and
duties of the retiring Administrative Agent and the term "Administrative Agent"
shall mean such successor Administrative Agent and the retiring Administrative
Agent's appointment, powers and duties as Administrative Agent shall be
terminated. After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Article 10, and Sections 11.3,
11.11 and 11.22, shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Administrative Agent under this Agreement.
Notwithstanding the foregoing, if (a) the Administrative Agent has not been paid
its agency fees under Section 3.4 or has not been reimbursed for any expense
reimbursable to it under Section 11.3, in either case for a period of at least
one (1) year and (b) no successor Administrative Agent has accepted appointment
as Administrative Agent by the date which is thirty (30) days following a
retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become effective
and the Lenders shall perform all of the duties of the Administrative Agent
hereunder until such time, if any, as the Requisite Lenders appoint a successor
Administrative Agent as provided for above.
10.9 No Obligations of Borrower. Nothing contained in this Article
10 shall be deemed to impose upon Borrower any obligation in respect of the due
and punctual performance by the Administrative Agent of its obligations to the
Lenders under any provision of this Agreement, and Borrower shall have no
liability to the Administrative Agent or any of the Lenders in respect of 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 Borrower to the
Administrative Agent for the account of the Lenders, Borrower's obligations to
the Lenders in respect of 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. In addition, Borrower may rely on a written statement by the
Administrative Agent to the effect that it has obtained the written consent
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of the Requisite Lenders or all of the Lenders, as applicable under Section
11.2, in connection with a waiver, amendment, consent, approval or other action
by the Lenders hereunder, and shall have no obligation to verify or confirm the
same.
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Article 11.
MISCELLANEOUS
11.1 Cumulative Remedies; No Waiver. The rights, powers, privileges
and remedies of the Administrative Agent and the Lenders 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 the Administrative Agent or any Lender 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 8 hereof are inserted for the
sole benefit of the Administrative Agent and the Lenders; the same may be waived
in whole or in part, with or without terms or conditions, in respect of any Loan
without prejudicing the Administrative Agent's or the Lenders' rights to assert
them in whole or in part in respect of any other Loan.
11.2 Amendments; 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 Borrower or any other Party therefrom, may in any event be
effective unless in writing signed by the Administrative Agent with the written
approval of the Requisite Lenders (and, in the case of any amendment,
modification or supplement of or to any Loan Document to which Borrower is a
Party, signed by Borrower, and, in the case of any amendment, modification or
supplement to Article 10, signed by the Administrative Agent), 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 the Commitments or the Pro Rata Share of any
Lender or the amount of any commitment fee payable to any Lender, or any
other fee or amount payable to any Lender under the Loan Documents or to
waive an Event of Default consisting of the failure of Borrower to pay
when due principal, interest or any fee;
(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 any installment of any fee, or to extend the term of the Commitments;
(c) To amend the provisions of the definition of "Requisite
Lenders", "Revolving Loan Maturity Date", or "Term Loan Maturity Date";
or
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(d) To release any Subsidiary Guarantor from the Subsidiary
Guaranty or to release any Collateral from the Lien of the Collateral
Documents, except if such release of Collateral occurs in connection
with a Disposition permitted under Section 6.2, in which case such
release shall not require the consent of any of the Lenders; or
(e) To amend or waive Section 8.1 or this Section 11.2; or
(f) To amend any provision of this Agreement that expressly
requires the consent or approval of all or a specified portion of the
Lenders.
Any amendment, modification, supplement, termination, waiver or consent pursuant
to this Section 11.2 shall apply equally to, and shall be binding upon, all the
Lenders and the Administrative Agent.
11.3 Costs, Expenses and Taxes. Borrower shall pay within five (5)
Banking Days after demand, accompanied by an invoice therefor, the reasonable
costs and expenses of the Administrative Agent incurred by the Administrative
Agent since August 8, 2000, the date of the last invoice in the amount of (***)
issued to the Administrative Agent by its counsel, in connection with the
negotiation, preparation, syndication, execution and delivery of the Loan
Documents (provided that in no event shall Borrower be required to pay more than
(***) of the costs and expenses incurred by the Administrative Agent since
August 8, 2000). Borrower shall also pay on demand, accompanied by an invoice
therefor, the reasonable costs and expenses of the Administrative Agent and the
Lenders in connection with each amendment of or waiver relating to the Loan
Documents after the anticipated first amendment to this Agreement, the costs and
expenses of which first amendment shall borne, and split evenly, by the Lenders,
and in connection with the refinancing, restructuring, reorganization (including
a bankruptcy reorganization) and enforcement or attempted enforcement of the
Loan Documents, and any matter related thereto. The foregoing costs and expenses
shall include filing fees, recording fees, title insurance fees, appraisal fees,
search fees, and other out-of-pocket expenses, and the reasonable fees and
out-of-pocket expenses of any legal counsel (including reasonably allocated
costs of legal counsel employed by the Administrative Agent or any Lender),
independent public accountants and other outside experts retained by the
Administrative Agent or any Lender, whether or not such costs and expenses are
incurred or suffered by the Administrative Agent or any Lender in connection
with or during the course of any bankruptcy or insolvency proceedings of
Borrower or any of its Subsidiaries. Borrower shall pay any and all documentary
and other taxes, excluding (i) taxes imposed on or measured in whole or in part
by a Lender's overall net income imposed on it by (A) any jurisdiction (or
political subdivision thereof) in which it is organized or maintains its
principal office or Eurodollar Lending Office or (B) any jurisdiction (or
political subdivision thereof) in which it is "doing business" or (ii) any
withholding taxes or other taxes based on gross income imposed by the United
States of America for any period with respect to which it has failed to provide
Borrower with the appropriate form or forms required by Section 11.21, to the
extent such forms are then required by applicable Laws,
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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 on the terms set forth in 11.11
the Administrative Agent and the Lenders 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 such 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 Administrative Agent or any
Lender under this Section 11.3 shall bear interest from the fifth Banking Day
following the date of demand for payment at the Default Rate.
11.4 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 Borrower or
any Affiliate of Borrower. A default by any Lender will not increase the Pro
Rata Share of the Commitments attributable to any other Lender. Any Lender not
in default may, if it desires, assume in such proportion as the non-defaulting
Lenders agree the obligations of any Lender in default, but is not obligated to
do so. The Administrative Agent agrees that it will use its best efforts either
to induce promptly the other Lenders to assume the obligations of a Lender in
default or to obtain promptly another Lender, reasonably satisfactory to
Borrower, to replace such a Lender in default.
11.5 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 Loans 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.
11.6 Notices. Except as otherwise expressly provided in the Loan
Documents, all notices, requests, demands, directions and other communications
provided for hereunder or under any other Loan Document must be in writing and
must be mailed, telegraphed, telecopied, dispatched by commercial courier or
delivered 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. 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 mail it will be effective on the earlier of
receipt or the fourth Banking Day after deposit in the United States mail with
first class or airmail postage prepaid; if given by telegraph or cable, when
delivered to the telegraph company with
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charges prepaid; if given by telecopier, when sent; if dispatched by commercial
courier, on the scheduled delivery date; or if given by personal delivery, when
delivered.
11.7 Execution of Loan Documents. Unless the Administrative Agent
otherwise specifies with respect to any Loan Document, (a) 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 and (b) execution
of any such counterpart may be evidenced by a telecopier transmission of the
signature of such party. The execution of this Agreement or any other Loan
Document by any party hereto or thereto will not become effective until
counterparts hereof or thereof, as the case may be, have been executed by all
the parties hereto or thereto.
11.8 Binding Effect; Assignment.
(a) This Agreement and the other Loan Documents to which Borrower
is a Party will be binding upon and inure to the benefit of Borrower,
the Administrative Agent, each of the Lenders, and their respective
successors and assigns, except that Borrower may not assign its rights
hereunder or thereunder or any interest herein or therein without the
prior written consent of all the Lenders. 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 such Note must be within the control of
such Lender). Any Lender may at any time pledge its Note or any other
instrument evidencing its rights as a Lender under this Agreement to a
Federal Reserve Bank, but no such pledge shall release that Lender from
its obligations hereunder or grant to such Federal Reserve Bank the
rights of a Lender hereunder absent foreclosure of such pledge.
(b) From time to time following the Closing Date, each Lender may
assign to one or more Eligible Assignees all or any portion of its Pro
Rata Share of the Commitments; provided that (i) such Eligible Assignee,
if not then a Lender or an Affiliate of the assigning Lender, shall be
approved by the Administrative Agent and (if no Event of Default then
exists) Borrower (neither of which approvals shall be unreasonably
withheld or delayed), (ii) such assignment shall be evidenced by a
Commitment Assignment and Acceptance, a copy of which shall be furnished
to the Administrative Agent as hereinbelow provided, (iii) except in the
case of an assignment to an Affiliate of the assigning Lender, to
another Lender or of the entire remaining Commitments of the assigning
Lender, the assignment shall not assign a Pro Rata Share of the
Commitments that is equivalent to less than $5,000,000 and (iv) the
effective date of any such assignment shall be as specified in the
Commitment Assignment and Acceptance, but not earlier than the date
which is five (5)
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Banking Days after the date the Administrative Agent has received the
Commitment Assignment and Acceptance. Upon the effective date of such
Commitment Assignment and Acceptance, the Eligible Assignee named
therein shall be a Lender for all purposes of this Agreement, with the
Pro Rata Share of the Commitments therein set forth and, to the extent
of such Pro Rata Share, the assigning Lender shall be released from its
further obligations under this Agreement. Borrower agrees that it shall
execute and deliver (against delivery by the assigning Lender to
Borrower of its Notes) to such assignee Lender, Notes evidencing that
assignee Lender's Pro Rata Share of the Commitments, and to the
assigning Lender, Notes evidencing the remaining balance Pro Rata Share
retained by the assigning Lender.
(c) By executing and delivering a Commitment Assignment and
Acceptance, the Eligible Assignee 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 of the Commitments
being assigned thereby free and clear of any adverse claim, the
assigning Lender has made no 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 Borrower or
the performance by Borrower of the Obligations; (iii) it has received a
copy of this Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 7.1 and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such Commitment 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 this Agreement; 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 Commitment Assignment and Acceptance
delivered to it and a register (the "Register") of the names and address
of each of the Lenders and the Pro Rata Share of the Commitments held by
each Lender, giving effect to each Commitment Assignment and Acceptance.
The Register shall be available during normal business hours for
inspection by Borrower or any Lender upon reasonable prior notice to the
Administrative Agent. After receipt of a completed Commitment Assignment
and Acceptance executed by any Lender and an Eligible Assignee, and
receipt of an assignment fee of $3,000 from such Lender or Eligible
Assignee, the Administrative Agent shall, promptly
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following the effective date thereof, provide to Borrower and the
Lenders a revised Schedule 1.1 giving effect thereto. Borrower, the
Administrative Agent and the Lenders shall deem and treat the Persons
listed as Lenders in the Register as the holders and owners of the Pro
Rata Share of the Commitments listed therein for all purposes hereof,
and no assignment or transfer of any such Pro Rata Share of the
Commitments shall be effective, in each case unless and until a
Commitment Assignment and Acceptance effecting the assignment or
transfer thereof shall have been accepted by the Administrative Agent
and recorded in the Register as provided above. Prior to such
recordation, all amounts owed with respect to the applicable Pro Rata
Share of the Commitments shall be owed to the Lender listed in the
Register as the owner thereof, and any request, authority or consent of
any Person who, at the time of making such request or giving such
authority or consent, is listed in the Register as a Lender shall be
conclusive and binding on any subsequent holder, assignee or transferee
of the corresponding Pro Rata Share of the Commitments.
(e) Each Lender may from time to time grant participations to one
or more banks or other financial institutions in a portion of its Pro
Rata Share of the Commitments; provided, however, that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations, (iii) the participating banks or
other financial institutions shall not be a Lender hereunder for any
purpose except, if the participation agreement so provides, for the
purposes of Sections 3.6, 3.7, 11.11 and 11.22 but only to the extent
that the cost of such benefits to Borrower does not exceed the cost
which Borrower would have incurred in respect of such Lender absent the
participation, (iv) Borrower, the Administrative Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this
Agreement, (v) the participation interest shall be expressed as a
percentage of the granting Lender's Pro Rata Share of the Commitments as
it then exists and shall not restrict an increase in the Commitments, or
in the granting Lender's Pro Rata Share of the Commitments, so long as
the amount of the participation interest is not affected thereby, (vi)
the holder of the participation interest shall abide by the
confidentiality provisions set forth herein and (vii) the consent of the
holder of such participation interest shall not be required for
amendments or waivers of provisions of the Loan Documents other than
those which (A) extend the Revolving Loan Maturity Date, the Term Loan
Maturity Date or any other date upon which any payment of money is due
to the Lenders, (B) reduce the rate of interest on the Notes, any fee or
any other monetary amount payable to the Lenders, (C) reduce the amount
of any installment of principal due under the Notes, (D) release any
Subsidiary Guaranty, or (E) release any Collateral from the Lien of the
Collateral Documents, except if such release of Collateral occurs in
connection with a Disposition permitted under Section 6.2, in which case
such release shall not require the consent of any of the Lenders or of
any holder of a participation interest in the Commitments.
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11.9 Right of Setoff. If an Event of Default has occurred and is
continuing, the Administrative Agent or any Lender (but in each case only with
the consent of the Requisite Lenders) may exercise its rights under Article 9 of
the Uniform Commercial Code and other applicable Laws and, to the extent
permitted by applicable Laws, apply any funds in any deposit account maintained
with it by Borrower and/or any Property of Borrower in its possession against
the Obligations.
11.10 Sharing of Setoffs. Each Lender severally agrees that if it,
through the exercise of any right of setoff, banker's lien or counterclaim
against Borrower, 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, subject to applicable
Laws: (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 each of the other Lenders a
participation in the Obligations held by the other Lenders and shall pay to the
other Lenders 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 in respect of 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 Borrower or any Person claiming through
or succeeding to the rights of Borrower, 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 11.10 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. Borrower expressly consents to
the foregoing arrangements and agrees that any Lender holding a participation in
an Obligation so purchased pursuant to this Section 11.10 may exercise any and
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.
11.11 Indemnity by Borrower. Borrower agrees to indemnify, save and
hold harmless the Administrative Agent and each Lender and their respective
directors, officers, agents, attorneys and employees (collectively the
"Indemnitees") from and against: (a) any and all claims, demands, actions or
causes of action (except a claim, demand, action, or cause of action for any
amount excluded from the definition of "Taxes" in Section 3.12(d)) if the claim,
demand, action or cause of action arises out of or relates to any act or
omission (or alleged act or omission) of
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Borrower, its Affiliates or any of its officers, directors or stockholders
relating to the Commitment, the use or contemplated use of proceeds of any Loan,
or the relationship of Borrower and the Lenders under this Agreement; (b) 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
clause (a) above; and (c) any and all liabilities, losses, reasonable costs or
expenses (including reasonable attorneys' fees and the reasonably allocated
costs of attorneys employed by any Indemnitee and disbursements of such
attorneys 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 or for any loss
asserted against it by another Indemnitee. If any claim, demand, action or cause
of action is asserted against any Indemnitee, such Indemnitee shall promptly
notify Borrower, but the failure to so promptly notify Borrower shall not affect
Borrower's obligations under this Section unless such failure materially
prejudices Borrower's right to participate in the contest of such claim, demand,
action or cause of action, as hereinafter provided. Such Indemnitee may (and
shall, if requested by Borrower in writing) contest the validity, applicability
and amount of such claim, demand, action or cause of action and shall permit
Borrower to participate in such contest. Such Indemnitee shall act reasonably
and in good faith in dealing with such claim, demand, action or cause of action,
including in electing whether to offer or accept any settlement or compromise of
such claim, demand, action or cause of action. Borrower shall have the burden of
establishing the lack of good faith or reasonableness of such Indemnitee. Any
Indemnitee that proposes to settle or compromise any claim or proceeding for
which Borrower may be liable for payment of indemnity hereunder shall give
Borrower 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 Borrower's prior written consent (which shall not be unreasonably
withheld or delayed). In connection with any claim, demand, action or cause of
action covered by this Section 11.11 against more than one Indemnitee, all such
Indemnitees shall be represented by the same legal counsel (which may be a law
firm engaged by the Indemnitees or attorneys employed by an Indemnitee or a
combination of the foregoing) selected by the Indemnitees and reasonably
acceptable to Borrower; 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 affected Indemnitee shall be entitled to separate
representation by legal counsel selected by that Indemnitee and reasonably
acceptable to Borrower, with all such legal counsel using reasonable efforts to
avoid unnecessary duplication of effort by counsel for all Indemnitees; and
further provided that the Administrative Agent (as an Indemnitee) shall at all
times be entitled to representation by separate legal counsel (which may be a
law firm or attorneys employed by the Administrative Agent or a combination of
the foregoing). Any obligation or liability of Borrower to any Indemnitee under
this Section 11.11 shall survive the expiration or termination of this Agreement
and the repayment of all Loans and the payment and performance of all other
Obligations owed to the Lenders.
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11.12 Nonliability of the Lenders. Borrower acknowledges and agrees
that:
(a) Any inspections of any Property of Borrower made by or
through the Administrative Agent or the Lenders are for purposes of
administration of the Loan only and Borrower is not entitled to rely
upon the same (whether or not such inspections are at the expense of
Borrower);
(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 Borrower and the Administrative
Agent and the Lenders is, and shall at all times remain, solely that of
borrowers and lenders; neither the Administrative Agent nor the Lenders
shall under any circumstance be construed to be partners or joint
venturers of Borrower or its Affiliates; neither the Administrative
Agent nor the Lenders shall under any circumstance be deemed to be in a
relationship of confidence or trust or a fiduciary relationship with
Borrower or its Affiliates, or to owe any fiduciary duty to Borrower or
its Affiliates; neither the Administrative Agent nor the Lenders
undertake or assume any responsibility or duty to Borrower or its
Affiliates to select, review, inspect, supervise, pass judgment upon or
inform Borrower or its Affiliates of any matter in connection with
their Property or the operations of Borrower or its Affiliates; Borrower
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 Borrower nor any other Person is entitled to rely thereon;
and
(d) The Administrative Agent and the Lenders shall not 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 caused by the actions, inaction or negligence of Borrower
and/or its Affiliates and Borrower hereby indemnifies and holds the
Administrative Agent and the Lenders harmless on the terms set forth in
Section 11.11 from any such loss, damage, liability or claim.
11.13 No Third Parties Benefited. This Agreement is made for the
purpose of defining and setting forth certain obligations, rights and duties of
Borrower, the Administrative Agent
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and the Lenders in connection with the Loans, and is made for the sole benefit
of Borrower, the Administrative Agent and the Lenders, and the Administrative
Agent's and the Lenders' successors and assigns. Except as provided in Sections
11.8 and 11.11, no other Person shall have any rights of any nature hereunder or
by reason hereof.
11.14 Confidentiality. Each Lender agrees to hold any confidential
information that it may receive from Borrower pursuant to this Agreement in
confidence, except for disclosure: (a) to other Lenders or Affiliates of a
Lender; (b) to legal counsel and accountants for Borrower or any Lender; (c) to
other professional advisors to Borrower or any Lender, provided that the
recipient has accepted such information subject to a confidentiality agreement
substantially similar to this Section 11.14; (d) to regulatory officials having
jurisdiction over that Lender; (e) as required by Law or legal process, provided
that each Lender agrees to notify Borrower of any such disclosures unless
prohibited by applicable Laws, or in connection with any legal proceeding to
which that Lender and Borrower are adverse parties; and (f) to another financial
institution in connection with a disposition or proposed disposition to that
financial institution of all or part of that Lender's interests hereunder or a
participation interest in its Notes, provided that the recipient has accepted
such information subject to a confidentiality agreement substantially similar to
this Section 11.14. For purposes of the foregoing, "confidential information"
shall mean any information respecting Borrower or its Subsidiaries reasonably
considered by Borrower to be confidential, other than (i) information previously
filed with any Governmental Agency and available to the public, (ii) information
previously published in any public medium from a source other than, directly or
indirectly, that Lender, and (iii) information previously disclosed by Borrower
to any Person not associated with Borrower which does not owe a professional
duty of confidentiality to Borrower or which has not executed an appropriate
confidentiality agreement with Borrower. Nothing in this Section shall be
construed to create or give rise to any fiduciary duty on the part of the
Administrative Agent or the Lenders to Borrower.
11.15 Further Assurances. Borrower shall, at its expense and without
expense to the Lenders or the Administrative Agent, do, execute and deliver such
further acts and documents as the Requisite Lenders or the Administrative Agent
from time to time reasonably require for the assuring and confirming unto the
Lenders or the Administrative Agent of the rights hereby created or intended now
or hereafter so to be, or for carrying out the intention or facilitating the
performance of the terms of any Loan Document.
11.16 Integration. This Agreement, together with the other Loan
Documents and the letter agreements referred to in Sections 3.2 and 3.4,
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 Administrative Agent or the Lenders in any
other Loan Document shall not be deemed a conflict
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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.
11.17 Governing Law; JURISDICTION AND VENUE. Except to the extent
otherwise provided therein, each Loan Document shall be governed by, and
construed and enforced in accordance with, the Laws of California applicable to
contracts made and performed in California. THE PARTIES AGREE THAT ALL ACTIONS
OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT SHALL BE TRIED AND
LITIGATED ONLY IN A STATE OR FEDERAL COURT LOCATED IN THE STATE OF CALIFORNIA.
THE PARTIES EXPRESSLY SUBMIT AND CONSENT IN ADVANCE TO SUCH JURISDICTION IN ANY
ACTION OR PROCEEDING COMMENCED IN ANY SUCH COURT, AND THE PARTIES HEREBY WAIVE
ANY OBJECTION THEY MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION AND HEREBY
CONSENT TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED
APPROPRIATE BY ANY SUCH COURT. FURTHERMORE, THE PARTIES HEREBY WAIVE, TO THE
EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT THEY MAY HAVE TO ASSERT THAT
ANY SUCH COURT IS AN INCONVENIENT FORUM OR OTHERWISE TO OBJECT TO VENUE TO THE
EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 11.17.
11.18 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.
11.19 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.
11.20 Time of the Essence. Time is of the essence of the Loan
Documents.
11.21 Foreign Lenders and Participants. Each Lender that is
incorporated or otherwise organized under the Laws of a jurisdiction other than
the United States of America or any State thereof or the District of Columbia
shall deliver to Borrower (with a copy to the Administrative Agent), on or
before the Closing Date (or on or before accepting an assignment or receiving a
participation interest herein pursuant to Section 11.8, if applicable) two duly
completed copies, signed by a Responsible Official, of either Form 1001
(relating to such Lender and entitling it to a complete exemption from
withholding on all payments to be made to such Lender by Borrower pursuant to
this Agreement) or Form 4224 (relating to all payments to be made to such Lender
by the
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Borrower pursuant to this Agreement) of the United States Internal Revenue
Service or such other evidence (including, if reasonably necessary, Form W-9)
satisfactory to Borrower and the Administrative Agent that no withholding under
the federal income tax laws is required with respect to such Lender. Thereafter
and from time to time, each such Lender shall (a) promptly submit to Borrower
(with a copy to the Administrative Agent), such additional duly completed and
signed copies of one of such forms (or such successor forms as shall be adopted
from time to time by the relevant United States taxing authorities) as may then
be available under then current United States laws and regulations to avoid, or
such evidence as is satisfactory to Borrower and the Administrative Agent of any
available exemption from, United States withholding taxes in respect of all
payments to be made to such Lender by Borrower pursuant to this Agreement and
(b) take such steps as shall not be materially disadvantageous to it, in the
reasonable judgment of such Lender, and as may be reasonably necessary
(including the re-designation of its Eurodollar Lending Office, if any) to avoid
any requirement of applicable Laws that Borrower make any deduction or
withholding for taxes from amounts payable to such Lender. In the event that
Borrower or the Administrative Agent become aware that a participation has been
granted pursuant to Section 11.8(e) to a financial institution that is
incorporated or otherwise organized under the Laws of a jurisdiction other than
the United States of America, any State thereof or the District of Columbia,
then, upon request made by Borrower or the Administrative Agent to the Lender
which granted such participation, such Lender shall cause such participant
financial institution to deliver the same documents and information to Borrower
and the Administrative Agent as would be required under this Section if such
financial institution were a Lender.
11.22 Hazardous Material Indemnity. Borrower hereby agrees to
indemnify, hold harmless and defend (by counsel reasonably satisfactory to the
Administrative Agent) the Administrative Agent and each of the Lenders and their
respective directors, officers, employees, agents, successors and assigns from
and against any and all claims, losses, damages, liabilities, fines, penalties,
charges, administrative and judicial proceedings and orders, judgments, remedial
action requirements, enforcement actions of any kind, and all reasonable costs
and expenses incurred in connection therewith (including but not limited to
reasonable attorneys' fees and the reasonably allocated costs of attorneys
employed by the Administrative Agent or any Lender, and expenses to the extent
that the defense of any such action has not been assumed by Borrower), arising
directly or indirectly out of (i) the presence on, in, under or about any Real
Property of any Hazardous Materials, or any releases or discharges of any
Hazardous Materials on, under or from any Real Property and (ii) any activity
carried on or undertaken on or off any Real Property by Borrower or any of its
predecessors in title, whether prior to or during the term of this Agreement,
and whether by Borrower or any predecessor in title or any employees, agents,
contractors or subcontractors of Borrower or any predecessor in title, or any
third persons at any time occupying or present on any Real Property, in
connection with the handling, treatment, removal, storage, decontamination,
clean-up, transport or disposal of any Hazardous Materials at any time located
or present on, in, under or about any Real Property. The foregoing indemnity
shall further apply to any residual contamination on, in, under or about any
Real Property, or affecting any natural resources, and to any
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contamination of any Property or natural resources arising in connection with
the generation, use, handling, storage, transport or disposal of any such
Hazardous Materials, and irrespective of whether any of such activities were or
will be undertaken in accordance with applicable Laws, but the foregoing
indemnity shall not apply to Hazardous Materials on any Real Property, the
presence of which is caused by the Administrative Agent or the Lenders. Borrower
hereby acknowledges and agrees that, notwithstanding any other provision of this
Agreement or any of the other Loan Documents to the contrary, the obligations of
Borrower under this Section shall be unlimited corporate obligations of Borrower
and shall not be secured by any Lien on any Real Property. Any obligation or
liability of Borrower to any Indemnitee under this Section 11.22 shall survive
the expiration or termination of this Agreement and the repayment of all Loans
and the payment and performance of all other Obligations owed to the Lenders.
11.23 Waiver of Right to Trial by Jury. BORROWER 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 BORROWER HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND,
ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND
THAT THE ADMINISTRATIVE AGENT OR ANY LENDER MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF
BORROWER TO THE WAIVER OF BORROWER'S RIGHT TO TRIAL BY JURY.
11.24 Purported Oral Amendments. BORROWER EXPRESSLY ACKNOWLEDGES
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 11.2. BORROWER AGREES THAT IT
WILL NOT RELY ON ANY COURSE OF DEALING, COURSE OF PERFORMANCE, OR ORAL OR
WRITTEN STATEMENTS BY ANY REPRESENTATIVE OF THE MANAGING AGENT OR ANY BANK THAT
DOES NOT COMPLY WITH SECTION 11.2 TO EFFECT AN AMENDMENT, MODIFICATION, WAIVER
OR SUPPLEMENT TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.
VIASAT, INC.
By: __________________________________________
Name: ________________________________________
Title: _______________________________________
Address:
ViaSat, Inc.
6155 El Camino Real
Carlsbad, California 92009
Attn: Rick Baldridge
Chief Financial Officer
Telecopier: (760) 476-2200
Telephone: (760) 929-3926
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UNION BANK OF CALIFORNIA, N.A.,
as Administrative Agent
By: __________________________________________
Myra Juetten
Vice President
Address:
Union Bank of California, N.A.
San Diego Commercial Banking Office
530 "B" Street, 4th Floor, S-420
San Diego, California 92101-4407
Attn: Myra Juetten
Telecopier: (619) 230-3766
Telephone: (619) 230-3763
UNION BANK OF CALIFORNIA, N.A.,
as a Lender
By: __________________________________________
Myra Juetten
Vice President
Address:
Union Bank of California, N.A.
San Diego Commercial Banking Office
530 "B" Street, 4th Floor, S-420
San Diego, California 92101-4407
Attn: Myra Juetten
Telecopier: (619) 230-3766
Telephone: (619) 230-3756
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WASHINGTON MUTUAL BANK, dba
WM Business Bank,
as a Lender
By: __________________________________________
Greg Marks
Vice President
Address:
WM Business Bank
San Diego Business Banking Center
101 West Broadway, Suite 110
San Diego, California 92101
Attn: Greg Marks
Telecopier: (619) 702-9157
Telephone: (619) 702-9208
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EXHIBIT G
REVOLVING NOTE
$12,500,000 June 21, 2001
Los Angeles, California
FOR VALUE RECEIVED, the undersigned promises to pay to the order
of WASHINGTON MUTUAL BANK DBA, WM BUSINESS BANK (the "Lender"), the principal
amount of TWELVE MILLION FIVE HUNDRED THOUSAND DOLLARS ($12,500,000), or such
lesser amount as shall equal the then aggregate outstanding Revolving Loans made
by the Lender to the undersigned under the Loan Agreement referred to below,
payable as hereinafter set forth. The undersigned promises to pay interest on
the principal amount hereof remaining unpaid from time to time from the date
hereof until the date of payment in full, payable as hereinafter set forth.
Reference is made to the Revolving/Term Loan Agreement, dated as
of June 21, 2001, by and among the undersigned, as Borrower, the Lenders which
are parties thereto, and UNION BANK OF CALIFORNIA, N.A., as Administrative Agent
for the Lenders (as amended, extended, renewed, supplemented or otherwise
modified from time to time, the "Loan Agreement"). Terms defined in the Loan
Agreement and not otherwise defined herein are used herein with the meanings
given those terms in the Loan Agreement. This is one of the Revolving Notes
referred to in the Loan Agreement, and any holder hereof is entitled to all of
the rights, remedies, benefits and privileges provided for in the Loan Agreement
as originally executed or as it may from time to time be supplemented, modified
or amended. The Loan Agreement, among other things, contains provisions for
acceleration of the maturity hereof upon the happening of certain stated events
upon the terms and conditions therein specified.
The principal indebtedness evidenced by this Note shall be payable
as provided in the Loan Agreement and in any event on the Maturity Date.
Interest shall be payable on the outstanding daily unpaid
principal amount of the Advance from the date thereof until payment in full and
shall accrue and be payable at the rates and on the dates set forth in the Loan
Agreement both before and after default and before and after maturity and
judgment, with interest on overdue principal and interest to bear interest at
the rate set forth in Section 3.7 of the Loan Agreement, to the fullest extent
permitted by applicable Law.
Each payment hereunder shall be made to the Administrative Agent
at the Administrative Agent's Office for the account of the Lender in
immediately available
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funds not later than 11:00 a.m. (California time) on the day of payment (which
must be a Banking Day). All payments received after 11:00 a.m. (California time)
on any particular Banking Day shall be deemed received on the next succeeding
Banking Day. All payments shall be made in lawful money of the United States of
America.
The Lender shall use its best efforts to keep a record of payments
of principal and interest received by it with respect to this Note, and such
record shall be presumptive evidence of the amounts owing under this Note.
The undersigned hereby promises to pay all costs and expenses of
any rightful holder hereof incurred in collecting the undersigned's obligations
hereunder in accordance with the Loan Agreement or in enforcing or attempting to
enforce any of such holder's rights hereunder, including reasonable attorneys'
fees and disbursements, whether or not an action is filed in connection
therewith.
The undersigned hereby waives presentment, demand for payment,
dishonor, notice of dishonor, protest, notice of protest and any other notice or
formality, to the fullest extent permitted by applicable Laws.
THIS NOTE SHALL BE DELIVERED TO AND ACCEPTED BY THE LENDER, OR BY
THE ADMINISTRATIVE AGENT ON BEHALF OF THE LENDER, IN THE STATE OF CALIFORNIA,
AND SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE
LOCAL LAWS THEREOF.
VIASAT, INC.,
a Delaware corporation
By:
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Name:
-----------------------------------
Title:
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SCHEDULE OF ADVANCES AND
PAYMENTS OF PRINCIPAL
Amount of Unpaid
Interest Principal Principal Notation
Date Period Paid Balance Made by
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EXHIBIT H
SECURITY AGREEMENT
THIS SECURITY AGREEMENT, dated as of June 21, 2001, is made by
VIASAT, INC., a Delaware corporation ("Borrower"), and those Subsidiaries of
Borrower that become parties hereto in the manner provided in Section 17 hereof
(collectively with Borrower, "Grantors"), jointly and severally, in favor of
UNION BANK OF CALIFORNIA, N.A., as the Administrative Agent under the Loan
Agreement referred to below, for the ratable benefit of each of the Lenders
which are parties to the Loan Agreement from time to time, as Secured Party,
with reference to the following facts:
RECITALS
A. Pursuant to the Revolving/Term Loan Agreement of even date
herewith by and among Borrower, the lenders from time to time a part thereto
(collectively, the "Lenders" and individually, a "Lender") and the
Administrative Agent (as such agreement may from time to time be amended,
extended, renewed, supplemented or otherwise modified, the "Loan Agreement"),
the Lenders have agreed to provide Borrower with certain credit facilities.
B. The Loan Agreement provides as a condition of the availability
of such credit facilities that Grantors shall enter into this Agreement and
shall grant security interests to Secured Party as herein provided to secure the
payment and performance of their obligations to the Administrative Agent and the
Lenders under the Loan Agreement and the Subsidiary Guaranty, respectively.
C. Each Grantor expects to realize direct and indirect benefits as
a result of the availability of the aforementioned loan credit facilities.
AGREEMENT
NOW, THEREFORE, in order to induce the Lenders to extend the
aforementioned credit facilities, and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, Grantors hereby
jointly and severally represent, warrant, covenant, agree, assign and grant as
follows:
1. Definitions. This Agreement is the Security Agreement referred
to in the Loan Agreement and is one of the "Loan Documents" referred to in the
Loan Agreement. Terms
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defined in the Loan Agreement and not otherwise defined in this Agreement shall
have the meanings defined for those terms in the Loan Agreement. Terms defined
in the California Uniform Commercial Code and not otherwise defined in this
Agreement or in the Loan Agreement shall have the meanings defined for those
terms in the California Uniform Commercial Code, as such statute may be amended
from time to time. As used in this Agreement, the following terms shall have the
meanings respectively set forth after each:
"Agreement" means this Security Agreement, and any extensions,
modifications, renewals, restatements, supplements or amendments hereof,
including, without limitation, any documents or agreements by which additional
Grantors become party hereto.
"Cash" means all monetary and non-monetary items owned by Grantors
that are treated as cash in accordance with GAAP, consistently applied.
"Collateral" means and includes all present and future rights and
powers of Grantors, and title and interest of Grantors, or any one or more of
them, in or to any and all of the following Property:
(a) All present and future accounts receivable, accounts,
rights to payment, notes and drafts, and obligations owing to any Grantor
or in which any Grantor may have any interest, however created or arising
and whether or not earned by performance;
(b) All present and future deposit accounts of any Grantor,
including, without limitation, any demand, time, savings, passbook or
like account maintained by any Grantor with any bank, savings and loan
association, credit union or like organization, and all money, Cash and
Cash equivalents of any Grantor, whether or not deposited in any such
deposit account;
(c) All present and future inventory and merchandise,
including, without limitation, all present and future goods held for sale
or lease or to be furnished under a contract of service, all raw
materials, work in process and finished goods, all packing materials,
supplies and containers relating to or used in connection with any of the
foregoing, and all bills of lading, warehouse receipts or documents of
title relating to any of the foregoing;
(d) All present and future accessions, appurtenances,
components, repairs, repair parts, spare parts, replacements,
substitutions, additions, issue and/or improvements to or of or with
respect to any of the foregoing;
(e) All rights, remedies, powers and/or privileges of any
Grantor with respect to any of the foregoing; and
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(f) Any and all proceeds and products of any of the
foregoing, including, without limitation, all money, accounts, deposit
accounts, insurance proceeds, and any other tangible or intangible
property received upon the sale or disposition of any of the foregoing;
provided that the term "Collateral", as used in this Agreement, shall not
include the Real Property or any interest therein.
"GAAP" means, as of any date of determination, accounting
principles (a) set forth as generally accepted in then currently effective
Opinions of the Accounting Principles Board of the American Institute of
Certified Public Accountants, (b) set forth as generally accepted in then
currently effective Statements of the Financial Accounting Standards Board or
(c) that are then approved by such other entity as may be approved by a
significant segment of the accounting profession in the United States of
America. The term "consistently applied," as used in connection therewith, means
that the accounting principles applied are consistent in all material respects
with those applied at prior dates or for prior periods.
"Governmental Agency" means (a) any international, foreign,
federal, state, county or municipal government, or political subdivision
thereof, (b) any governmental or quasi-governmental agency, authority, board,
bureau, commission, department, instrumentality or public body or (c) any court
or administrative tribunal of competent jurisdiction.
"Grantors" means Borrower and those Significant Domestic
Subsidiaries of Borrower that become parties hereto as provided in Section 17
hereof, and each of them, and any one or more of them, jointly and severally. At
such times, if any, as no Domestic Subsidiaries of Borrower are parties hereto,
the term "Grantors" shall refer solely to Borrower.
"Investment" means, when used in connection with any Grantor, any
investment by or of that Grantor, whether by means of purchase or other
acquisition of stock or other securities of any other Person or by means of a
loan, advance creating a debt, capital contribution, guaranty or other debt or
equity participation or interest in any other Person, including any partnership
and joint venture interests of such Person.
"Laws" means, collectively, all international, foreign, federal,
state and local statutes, treaties, rules, regulations, ordinances, codes and
administrative or judicial precedents.
"Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment for security, security interest, encumbrance, lien or charge of any
kind, whether voluntarily incurred or arising by operation of Law or otherwise,
affecting any Property, including any conditional sale or other title retention
agreement, any lease in the nature of a security interest, and/or the filing of
any financing statement (other than a precautionary financing statement with
respect to a lease that is not
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in the nature of a security interest) under the Uniform Commercial Code or
comparable Law of any jurisdiction with respect to any Property.
"Permitted Encumbrances" means:
(a) inchoate Liens incident to construction on or
maintenance of Property; or Liens incident to construction on or
maintenance of Property now or hereafter filed of record for which
adequate reserves have been set aside (or deposits made pursuant to
applicable Law) and which are being contested in good faith by
appropriate proceedings and have not proceeded to judgment, provided
that, by reason of nonpayment of the obligations secured by such Liens,
no such Property is subject to a material impending risk of loss or
forfeiture;
(b) Liens for taxes and assessments on Property which are
not yet past due; or Liens for taxes and assessments on Property for
which adequate reserves have been set aside and are being contested in
good faith by appropriate proceedings and have not proceeded to judgment,
provided that, by reason of nonpayment of the obligations secured by such
Liens, no such Property is subject to a material impending risk of loss
or forfeiture;
(c) defects and irregularities in title to any Property
which in the aggregate do not materially impair the fair market value or
use of the Property for the purposes for which it is or may reasonably be
expected to be held;
(d) easements, exceptions, reservations, or other
agreements for the purpose of pipelines, conduits, cables, wire
communication lines, power lines and substations, streets, trails,
walkways, drainage, irrigation, water, and sewerage purposes, dikes,
canals, ditches, the removal of oil, gas, coal, or other minerals, and
other like purposes affecting Property which in the aggregate do not
materially burden or impair the fair market value or use of such Property
for the purposes for which it is or may reasonably be expected to be
held;
(e) easements, exceptions, reservations, or other
agreements for the purpose of facilitating the joint or common use of
Property in or adjacent to a shopping center or similar project affecting
Property which in the aggregate do not materially burden or impair the
fair market value or use of such Property for the purposes for which it
is or may reasonably be expected to be held;
(f) rights reserved to or vested in any Governmental Agency
to control or regulate, or obligations or duties to any Governmental
Agency with respect to, the use of any Property;
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(g) rights reserved to or vested in any Governmental Agency
to control or regulate, or obligations or duties to any Governmental
Agency with respect to, any right, power, franchise, grant, license, or
permit;
(h) present or future zoning laws and ordinances or other
laws and ordinances restricting the occupancy, use, or enjoyment of
Property;
(i) statutory Liens, other than those described in clauses
(a) or (b) above, arising in the ordinary course of business with respect
to obligations which are not delinquent or are being contested in good
faith, provided that, if delinquent, adequate reserves have been set
aside with respect thereto and, by reason of nonpayment, no Property is
subject to a material impending risk of loss or forfeiture;
(j) covenants, conditions, and restrictions affecting the
use of Property which in the aggregate do not materially impair the fair
market value or use of the Property for the purposes for which it is or
may reasonably be expected to be held;
(k) rights of tenants under leases and rental agreements
covering Property entered into in the ordinary course of business of the
Person owning such Property;
(l) Liens consisting of pledges or deposits to secure
obligations under workers' compensation laws or similar legislation,
including Liens of judgments thereunder which are not currently
dischargeable;
(m) Liens consisting of pledges or deposits of Property to
secure performance in connection with operating leases made in the
ordinary course of business;
(n) Liens consisting of deposits of Property to secure bids
made with respect to, or performance of, contracts (other than contracts
creating or evidencing an extension of credit to the depositor);
(o) Liens consisting of any right of offset, or statutory
bankers' lien, on bank deposit accounts maintained in the ordinary course
of business so long as such bank deposit accounts are not established or
maintained for the purpose of providing such right of offset or bankers'
lien;
(p) Liens consisting of deposits of Property to secure
statutory obligations of Borrower;
(q) Liens consisting of deposits of Property to secure (or
in lieu of) surety, appeal or customs bonds;
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(r) Liens created by or resulting from any litigation or
legal proceeding in the ordinary course of business which is currently
being contested in good faith by appropriate proceedings, provided that
adequate reserves have been set aside and no material Property is subject
to a material impending risk of loss or forfeiture; and
(s) other non-consensual Liens incurred in the ordinary
course of business but not in connection with the incurrence of any
indebtedness, which do not in the aggregate, when taken together with all
other Liens, materially impair the fair market value or use of the
Property for the purposes for which it is or may reasonably be expected
to be held.
"Property" means any interest of Grantors in any personal property
intended as Collateral under this Security Agreement.
"Real Property" means all real property now or hereafter owned,
leased or occupied by Grantors.
"Secured Party" means the Administrative Agent, who shall hold the
Liens and security interests granted hereunder for the ratable benefit of each
of the Lenders which are parties to the Loan Agreement from time to time.
2. Further Assurances. Concurrent with its execution and delivery
of this Agreement to Secured Party and thereafter, each Grantor shall execute
and deliver to Secured Party all such financing statements, deposit account
control agreements and other agreements, instruments and documents in form and
substance satisfactory to Secured Party as shall be reasonably necessary or
desirable to perfect fully, when filed and/or recorded, and to ensure the
first-priority status of, Secured Party's security interests granted pursuant to
Section 3 of this Agreement. At any time and from time to time, Secured Party is
hereby authorized and shall be entitled to file and/or record any or all such
financing statements, instruments and documents held by it, and any or all such
further financing statements, documents and instruments, and to take all such
other actions, as Secured Party may reasonably deem appropriate to perfect and
to maintain perfected, and to ensure the first- priority status of, the security
interests granted in Section 3 of this Agreement. At Secured Party's request,
whether before or after the occurrence of an Event of Default, each Grantor
shall execute all such further financing statements, deposit account control
agreements, instruments and documents, and shall do all such further acts and
things, as reasonably may be deemed necessary or desirable by Secured Party to
create and perfect, and to continue and preserve, an indefeasible security
interest in the Collateral in favor of Secured Party, or the priority thereof.
With respect to any Collateral which Secured Party's security interest need be
perfected by, or the priority thereof need be assured by, possession of such
Collateral, Grantors will upon demand of Secured Party deliver possession of
same in pledge to Secured Party.
3. Security Agreement. For valuable consideration, Grantors, and
each of them, hereby assign and pledge to Secured Party, and grant to Secured
Party a first-priority security
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interest in, all presently existing and hereafter acquired Collateral, as
security for the timely payment and performance of the Obligations, and each of
them. This Agreement is a continuing and irrevocable agreement and all the
rights, powers, privileges and remedies hereunder shall apply to any and all
Obligations, including those arising under successive transactions which shall
either continue the Obligations, increase or decrease them, or from time to time
create new Obligations after all or any prior Obligations have been satisfied,
and notwithstanding the bankruptcy of any Grantor or any other Person or any
other event or proceeding affecting any Person.
4. Grantors' Representations, Warranties and Agreements. Except as
otherwise disclosed to Secured Party in writing concurrently herewith, Grantors
represent, warrant and agree that: (a) each Grantor will pay, prior to
delinquency, all taxes, charges, Liens and assessments against the portion of
the Collateral owned by it, except Permitted Encumbrances, and such other Liens
as are timely contested in good faith, and upon its failure to pay or so contest
such taxes, charges, Liens and assessments, Secured Party at its option may pay
any of them; (b) the Collateral will not be used for any unlawful purpose or in
violation of any Law, regulation or ordinance, nor used in any way that will
void or impair any insurance required to be carried in connection therewith; (c)
each Grantor will, to the extent consistent with good business practice, keep
the portion of the Collateral owned by it in reasonably good repair, working
order and condition, and from time to time make all needful and proper repairs,
renewals, replacements, additions and improvements thereto and, as appropriate
and applicable, will otherwise deal with such portion of the Collateral in all
such ways as are considered good practice by owners of like Property; (d) each
Grantor will take all reasonable steps to preserve and protect the Collateral;
(e) each Grantor will maintain, with responsible insurance companies, insurance
covering the Collateral against such insurable losses as is required by the Loan
Agreement and as is consistent with sound business practice, and will cause
Secured Party to be designated as an additional insured and loss payee with
respect to all insurance (whether or not required by the Loan Agreement), will
obtain the written agreement of the insurers that such insurance shall not be
canceled, terminated or materially modified to the detriment of Secured Party
without at least 30 days prior written notice to Secured Party, and will furnish
copies of such insurance policies or certificates to Secured Party promptly upon
request therefor; (f) Grantors will promptly notify Secured Party in writing in
the event of damage to any material portion of the Collateral from any source
whatsoever, and, except for the disposition of collections and other proceeds of
the Collateral permitted by Section 6 hereof, Grantors will not remove or permit
to be removed any part of the Collateral from their places of business without
the prior written consent of Secured Party, except for such items of the
Collateral as are removed in the ordinary course of business or in connection
with any transaction or disposition otherwise permitted by the Loan Documents;
and (g) in the event any Grantor changes its name or its address as either are
set forth herein or in any Loan Document, such Grantor will notify Secured Party
of such name and/or address change promptly, but in any event, within five (5)
Business Days.
5. Secured Party's Rights Regarding Collateral. At any time
(whether or not an Event of Default has occurred), without notice or demand and
at the expense of each Grantor with regard to the portion of the Collateral
owned by it, Secured Party may, to the extent it may be
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necessary or desirable to protect the security hereunder, but Secured Party
shall not be obligated to: (a) at all reasonable times on reasonable notice,
enter upon any premises on which Collateral is situated and examine the same or
(b) perform any obligation of any Grantor under this Agreement or any obligation
of any other Person under the Loan Documents. After the occurrence and during
the continuance of an Event of Default, at the expense of each Grantor with
regard to the portion of the Collateral owned by it, Secured Party may, to the
extent it may be necessary or desirable to protect the security hereunder, but
Secured Party shall not be obligated to, request from obligors on the
Collateral, in the name of any Grantor or in the name of Secured Party,
information concerning the Collateral and the amounts owing thereon. Each
Grantor shall maintain books and records pertaining to the Collateral in such
detail, form and scope as is reasonably required by Secured Party to perfect, or
maintain the effectiveness of Secured Party's security interests hereunder. Each
Grantor shall at any time at Secured Party's request mark the Collateral and/or
such Grantor's ledger cards, books of account and other records relating to the
Collateral with appropriate notations satisfactory to Secured Party disclosing
that they are subject to Secured Party's security interests. Secured Party shall
at all reasonable times on reasonable notice have full access to and the right
to audit any and all of Grantors' books and records pertaining to the
Collateral, and to confirm and verify the value of the Collateral and to do
whatever else Secured Party reasonably may deem necessary or desirable to
protect its interests; provided, however, that any such action which involves
communicating with customers of Grantors shall be carried out by Secured Party
through Grantors' independent auditors unless Secured Party shall then have the
right directly to notify obligors on the Collateral as provided in Section 9.
Secured Party shall be under no duty or obligation whatsoever to take any action
to preserve any rights of or against any prior or other parties in connection
with the Collateral, to exercise any voting rights or managerial rights with
respect to any Collateral, whether or not an Event of Default shall have
occurred, or to make or give any presentments, demands for performance, notices
of non-performance, protests, notices of protests, notices of dishonor or
notices of any other nature whatsoever in connection with the Collateral or the
Obligations. Secured Party shall be under no duty or obligation whatsoever to
take any action to protect or preserve the Collateral or any rights of any
Grantor therein, or to make collections or enforce payment thereon, or to
participate in any foreclosure or other proceeding in connection therewith.
6. Collections on the Collateral. Except as otherwise provided in
any Loan Document, Grantors shall have the right to use and to continue to make
collections on and receive dividends and other proceeds of all of the Collateral
in the ordinary course of business so long as no notice has been given by
Secured Party that it intends to exercise remedies after an Event of Default has
occurred and is continuing. Upon the occurrence and during the continuance of an
Event of Default, at the option of Secured Party, Grantors' right to make
collections on and receive dividends and other proceeds of the Collateral and to
use or dispose of such collections and proceeds shall terminate, and any and all
dividends, proceeds and collections, including all partial or total prepayments,
then held or thereafter received on or on account of the Collateral will be held
or received by Grantors in trust for Secured Party and immediately delivered in
kind to Secured Party. Any remittance received by any Grantor from any Person
shall be presumed to relate to the Collateral and to be subject to Secured
Party's security interests. Upon the occurrence and during
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the continuance of an Event of Default, Secured Party shall have the sole right
at all times to receive, receipt for, endorse, assign, deposit and deliver, in
the name of Secured Party or in the name of the appropriate Grantor, any and all
checks, notes, drafts and other instruments for the payment of money
constituting proceeds of or otherwise relating to the Collateral; and each
Grantor hereby authorizes Secured Party to affix, by facsimile signature or
otherwise, the general or special endorsement of it, in such manner as Secured
Party shall deem advisable, to any such instrument in the event the same has
been delivered to or obtained by Secured Party without appropriate endorsement,
and Secured Party and any collecting bank are hereby authorized to consider such
endorsement to be a sufficient, valid and effective endorsement by the
appropriate Grantor, to the same extent as though it were manually executed by
the duly authorized officer of the appropriate Grantor, regardless of by whom or
under what circumstances or by what authority such facsimile signature or other
endorsement actually is affixed, without duty of inquiry or responsibility as to
such matters, and each Grantor hereby expressly waives demand, presentment,
protest and notice of protest or dishonor and all other notices of every kind
and nature with respect to any such instrument.
7. Possession of Collateral by Secured Party. All the Collateral
now, heretofore or hereafter delivered to Secured Party in its capacity as
Secured Party shall be held by Secured Party in its possession, custody and
control. Upon the occurrence and during the continuance of an Event of Default,
whenever any of the Collateral is in Secured Party's possession, custody or
control, Secured Party may use, operate and consume the Collateral, whether for
the purpose of preserving and/or protecting the Collateral, or for the purpose
of performing any of Grantors' obligations with respect thereto, or otherwise,
subject to compliance with the requirements of applicable Laws. Secured Party
may at any time deliver or redeliver the Collateral or any part thereof to
Grantors, and the receipt of any of the same by any Grantor shall be complete
and full acquittance for the Collateral so delivered, and Secured Party
thereafter shall be discharged from any liability or responsibility therefor. So
long as Secured Party exercises reasonable care with respect to any Collateral
in its possession, custody or control, Secured Party shall have no liability for
any loss of or damage to such Collateral, and in no event shall Secured Party
have liability for any diminution in value of Collateral occasioned by economic
or market conditions or events. Secured Party shall be deemed to have exercised
reasonable care within the meaning of the preceding sentence if the Collateral
in the possession, custody or control of Secured Party is accorded treatment
substantially equal to that which Secured Party accords its own property.
8. Release of Collateral. Collateral that is required to be
released from the Lien created by this Agreement in order to permit Grantor to
consummate any disposition of assets or grant any Lien that Grantor is entitled
to consummate or grant pursuant to the Loan Documents, shall be so released by
Secured Party at such times and to the extent necessary to permit Grantor to
effect such permitted transactions promptly following the Secured Party's
receipt of written request therefor by Grantor specifying the purpose for which
release is requested and such further certificates or other documents as Secured
Party reasonably shall request in its discretion to confirm that Grantor is
permitted to effect such permitted transaction and to confirm Secured Party's
replacement Liens on appropriate collateral (unless replacement collateral is
not required pursuant to the Loan
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Documents). Any request for any permitted release shall be transmitted to
Secured Party. Secured Party, at the expense of Grantor, promptly shall release
and return to Grantor all Collateral in Secured Party's possession or under
Secured Party's control and shall execute and deliver to Grantor all documents
requested by Grantor that are reasonably necessary to release Secured Party's
security interest in any Collateral required to be released in accordance with
this Section 8. Upon payment in full of all Obligations and the termination of
all financing commitments by the Lenders, Secured Party, at the expense of
Grantor, shall promptly redeliver to Grantor all Collateral in Secured Party's
possession or under Secured Party's control and shall execute and deliver to
Grantor all documents requested by Grantor that are reasonably necessary to
terminate Secured Party's security interest in the Collateral.
9. Rights Upon Event of Default. Upon the occurrence and during
the continuance of an Event of Default, subject to compliance with the
requirements of applicable Laws, Secured Party shall have, in any jurisdiction
where enforcement hereof is sought, in addition to all other rights and remedies
that Secured Party may have under applicable Law or in equity or under this
Agreement (including, without limitation, all rights set forth in Section 6
hereof) or under any other Loan Document, all rights and remedies of a secured
party under the Uniform Commercial Code as enacted in any jurisdiction, and, in
addition, the following rights and remedies, all of which may be exercised with
or without notice to Grantors and without affecting the obligations of Grantors
hereunder or under any other Loan Document, or the enforceability of the Liens
and security interests created hereby: (a) to foreclose the Liens and security
interests created hereunder or under any other agreement relating to any
Collateral by any available judicial procedure or without judicial process; (b)
to enter any premises where any Collateral may be located for the purpose of
securing, protecting, inventorying, appraising, inspecting, repairing,
preserving, storing, preparing, processing, taking possession of or removing the
same; (c) to sell, assign, lease or otherwise dispose of any Collateral or any
part thereof, either at public or private sale or at any broker's board, in lot
or in bulk, for cash, on credit or otherwise, with or without representations or
warranties and upon such terms as shall be acceptable to Secured Party; (d) to
notify obligors on the Collateral that the Collateral has been assigned to
Secured Party and that all payments thereon are to be made directly and
exclusively to Secured Party; (e) to collect by legal proceedings or otherwise
all dividends, distributions, interest, principal or other sums now or hereafter
payable upon or on account of the Collateral; (f) to cause the Collateral to be
registered in the name of Secured Party, as legal owner; (g) to enter into any
extension, reorganization, deposit, merger or consolidation agreement, or any
other agreement relating to or affecting the Collateral, and in connection
therewith Secured Party may deposit or surrender control of the Collateral
and/or accept other Property in exchange for the Collateral; (h) to settle,
compromise or release, on terms acceptable to Secured Party, in whole or in
part, any amounts owing on the Collateral and/or any disputes with respect
thereto; (i) to extend the time of payment, make allowances and adjustments and
issue credits in connection with the Collateral in the name of Secured Party or
in the name of any Grantor; (j) to enforce payment and prosecute any action or
proceeding with respect to any or all of the Collateral and take or bring, in
the name of Secured Party or in the name of any Grantor, any and all steps,
actions, suits or proceedings deemed by Secured Party necessary or desirable to
effect collection of or to realize upon the Collateral, including any judicial
or nonjudicial foreclosure
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thereof or thereon, and each Grantor specifically consents to any nonjudicial
foreclosure of any or all of the Collateral or any other action taken by Secured
Party which may release any obligor from personal liability on any of the
Collateral, and each Grantor waives any right not expressly provided for in this
Agreement to receive notice of any public or private judicial or nonjudicial
sale or foreclosure of any security or any of the Collateral; and any money or
other property received by Secured Party in exchange for or on account of the
Collateral, whether representing collections or proceeds of Collateral, and
whether resulting from voluntary payments or foreclosure proceedings or other
legal action taken by Secured Party or Grantors may be applied by Secured Party
without notice to Grantors to the Obligations in such order and manner as
Secured Party in its sole discretion shall determine; (k) to insure, process and
preserve the Collateral; (l) to exercise all rights, remedies, powers or
privileges provided under any of the Loan Documents; (m) to remove, from any
premises where the same may be located, the Collateral and any and all
documents, instruments, files and records, and any receptacles and cabinets
containing the same, relating to the Collateral, and Secured Party may, at the
cost and expense of each Grantor, use such of its supplies, equipment,
facilities and space at its places of business as may be necessary or
appropriate to properly administer, process, store, control, prepare for sale or
disposition and/or sell or dispose of the portion of the Collateral owned by
such Grantor or to properly administer and control the handling of collections
and realizations thereon, and Secured Party shall be deemed to have a rent-free
tenancy of any premises of any Grantor for such purposes and for such periods of
time as reasonably required by Secured Party; (n) to receive, open and dispose
of all mail addressed to any Grantor and notify postal authorities to change the
address for delivery thereof to such address as Secured Party may designate;
provided that Secured Party agrees that it will promptly deliver over to the
appropriate Grantor such opened mail as does not relate to the Collateral; and
(o) to exercise all other rights, powers, privileges and remedies of an owner of
the Collateral; all at Secured Party's sole option and as Secured Party in its
sole discretion may deem advisable. Grantors will, at Secured Party's request,
assemble the Collateral and make it available to Secured Party at places which
Secured Party may reasonably designate, whether at the premises of Grantors or
elsewhere, and will make available to Secured Party, free of cost, all premises,
equipment and facilities of Grantors for the purpose of Secured Party's taking
possession of the Collateral or storing same or removing or putting the
Collateral in saleable form or selling or disposing of same.
Upon the occurrence and during the continuance of an Event of
Default, Secured Party also shall have the right, without notice or demand,
either in person, by agent or by a receiver to be appointed by a court (and
Grantors hereby expressly consent upon the occurrence and during the continuance
of an Event of Default to the appointment of such a receiver), and without
regard to the adequacy of any security for the Obligations, to take possession
of the Collateral or any part thereof and to collect and receive the rents,
issues, profits, income and proceeds thereof. Taking possession of the
Collateral shall not cure or waive any Event of Default or notice thereof or
invalidate any act done pursuant to such notice. The rights, remedies and powers
of any receiver appointed by a court shall be as ordered by said court.
Any public or private sale or other disposition of the Collateral
may be held at any office of Secured Party, or at Grantors' places of business,
or at any other place permitted by
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applicable Law, and without the necessity of the Collateral's being within the
view of prospective purchasers. Secured Party may direct the order and manner of
sale of the Collateral, or portions thereof, as it in its sole and absolute
discretion may determine, and Grantors expressly waive any right to direct the
order and manner of sale of any Collateral. Secured Party or any Person on
Secured Party's behalf may bid and purchase at any such sale or other
disposition. The net cash proceeds resulting from the collection, liquidation,
sale, lease or other disposition of the Collateral shall be applied, first, to
the expenses (including reasonable attorneys' fees and disbursements) of
retaking, holding, storing, processing and preparing for sale or lease, selling,
leasing, collecting, liquidating and the like, and then to the satisfaction of
the Obligations in such order as shall be determined by Secured Party in its
sole and absolute discretion. Grantors and any other Person then obligated
therefor shall pay to Secured Party on demand any deficiency with regard thereto
which may remain after such sale, disposition, collection or liquidation of the
Collateral.
Unless the Collateral is perishable or threatens to decline
speedily in value or is of a type customarily sold on a recognized market,
Secured Party will send or otherwise make available to the Borrower, as agent
for Grantors and each of them, reasonable notice of the time and place of any
public sale thereof or of the time on or after which any private sale thereof is
to be made. The requirement of sending reasonable notice conclusively shall be
met if such notice is mailed, first class mail, postage prepaid, to the Borrower
at its address set forth in the Loan Agreement, or delivered or otherwise sent
to the Borrower, at least ten (10) days before the date of the sale. Each
Grantor other than the Borrower hereby irrevocably appoints the Borrower as its
agent for the purpose of receiving notice of sale hereunder, and agrees that
such Grantor conclusively shall be deemed to have received notice of sale when
notice of sale has been given to the Borrower. Each Grantor expressly waives any
right to receive notice of any public or private sale of any Collateral or other
security for the Obligations except as expressly provided for in this paragraph.
Upon consummation of any sale of Collateral hereunder, Secured
Party shall have the right to assign, transfer and deliver to the purchaser or
purchasers thereof the Collateral so sold. Each such purchaser at any such sale
shall hold the Collateral so sold absolutely free from any claim or right upon
the part of any Grantor or any other Person, and each Grantor hereby waives (to
the extent permitted by applicable Laws) all rights of redemption, stay and
appraisal which it now has or may at any time in the future have under any rule
of Law or statute now existing or hereafter enacted. If the sale of all or any
part of the Collateral is made on credit or for future delivery, Secured Party
shall not be required to apply any portion of the sale price to the Obligations
until such amount actually is received by Secured Party, and any Collateral so
sold may be retained by Secured Party until the sale price is paid in full by
the purchaser or purchasers thereof. Secured Party shall not incur any liability
in case any such purchaser or purchasers shall fail to pay for the Collateral so
sold, and, in case of any such failure, the Collateral may be sold again.
10. Attorney-in-Fact. Each Grantor hereby irrevocably nominates
and appoints Secured Party after the occurrence and during the continuance of an
Event of Default as its attorney-in-fact for the following purposes, subject to
compliance with the requirements of applicable Laws: (a) to do all acts and
things which Secured Party may deem necessary or
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advisable to perfect and continue perfected the security interests created by
this Agreement and to preserve, process, develop, maintain and protect the
Collateral; (b) to do any and every act which any Grantor is obligated to do
under this Agreement, at the expense of the Grantor so obligated and without any
obligation to do so; (c) to prepare, sign, file and/or record, for any Grantor,
in the name of the appropriate Grantor, any financing statement, application for
registration, or like paper, and to take any other action deemed by Secured
Party necessary or desirable in order to perfect or maintain perfected the
security interests granted hereby; and (d) to execute any and all papers and
instruments and do all other things necessary or desirable to preserve and
protect the Collateral and to protect Secured Party's security interests
therein; provided, however, that Secured Party shall be under no obligation
whatsoever to take any of the foregoing actions, and, absent gross negligence,
bad faith or actual malice, Secured Party shall have no liability or
responsibility for any act taken or omission with respect thereto.
11. Costs and Expenses. Each Grantor agrees to pay to Secured
Party all reasonable costs and expenses (including, without limitation,
reasonable attorneys' fees and disbursements) incurred by Secured Party in the
enforcement or attempted enforcement of this Agreement, whether or not an action
is filed in connection therewith, and in connection with any waiver or amendment
of any term or provision hereof. All advances, charges, costs and expenses,
including reasonable attorneys' fees and disbursements, incurred or paid by
Secured Party in exercising any right, privilege, power or remedy conferred by
this Agreement (including, without limitation, the right to perform any
Obligation of any Grantor under the Loan Documents), or in the enforcement or
attempted enforcement thereof, shall be secured hereby and shall become a part
of the Obligations and shall be paid to Secured Party by each Grantor,
immediately upon demand, together with interest thereon at the rates provided
for under the Loan Agreement.
12. Statute of Limitations and Other Laws. Until the Obligations
shall have been paid and performed in full, the power of sale and all other
rights, privileges, powers and remedies granted to Secured Party hereunder shall
continue to exist and may be exercised by Secured Party at any time and from
time to time irrespective of the fact that any of the Obligations may have
become barred by any statute of limitations. Each Grantor expressly waives the
benefit of any and all statutes of limitation, and any and all Laws providing
for exemption of property from execution or for valuation and appraisal upon
foreclosure, to the maximum extent permitted by applicable Law.
13. Other Agreements. Nothing herein shall in any way modify or
limit the effect of terms or conditions set forth in any other security or other
agreement executed by any Grantor or in connection with the Obligations, but
each and every term and condition hereof shall be in addition thereto. All
provisions contained in the Loan Agreement or any other Loan Document that apply
to Loan Documents generally are fully applicable to this Agreement and are
incorporated herein by this reference.
14. Incorporation of Suretyship Provisions and Waivers. The
attached Exhibit B, "Suretyship Provisions and Waivers", is hereby incorporated
by this reference as though set forth herein in full.
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15. Understandings with Respect to Waivers and Consents. Grantors
and each of them warrant and agree that each of the waivers and consents set
forth herein are made after consultation with legal counsel and with full
knowledge of their significance and consequences, with the understanding that
events giving rise to any defense or right waived may diminish, destroy or
otherwise adversely affect rights which Grantors otherwise may have against the
Borrower, Secured Party or others, or against Collateral, and that, under the
circumstances, the waivers and consents herein given are reasonable and not
contrary to public policy or Law. If any of the waivers or consents herein are
determined to be contrary to any applicable Law or public policy, such waivers
and consents shall be effective to the maximum extent permitted by Law.
16. Continuing Effect. This Agreement shall remain in full force
and effect and continue to be effective should any petition be filed by or
against any Grantor for liquidation or reorganization, should any Grantor become
insolvent or make an assignment for the benefit of creditors or should a
receiver or trustee be appointed for all or any significant part of any
Grantor's assets, and shall continue to be effective or be reinstated, as the
case may be, if at any time payment and performance of the Obligations, or any
part thereof, is, pursuant to applicable Law, rescinded or reduced in amount, or
must otherwise be restored or returned by Administrative Agent or any Lender,
whether as a "voidable preference," "fraudulent conveyance," or otherwise, all
as though such payment or performance had not been made. In the event that any
payment or any part thereof is rescinded, reduced, restored or returned, the
Obligations shall be reinstated and deemed reduced only by such amount paid and
not so rescinded, reduced, restored or returned.
17. Additional Grantors. The initial Grantors hereunder shall be
the Borrower and the Significant Domestic Subsidiaries as are signatories
hereto. From time to time following the Closing Date, additional Significant
Domestic Subsidiaries of the Borrower may become parties hereto, as additional
Grantors, by executing and delivering to Secured Party an Instrument of Joinder
substantially in the form of Exhibit A, accompanied by such documentation as the
Secured Party may require in connection therewith, wherein such additional
Grantors agree to become a party hereto and to be bound hereby. Upon delivery of
such Instrument of Joinder to and acceptance thereof by Secured Party, notice of
which acceptance is hereby waived by Grantors, each such additional Grantor
shall be as fully a party hereto as if such Grantor were an original signatory
hereof. Each Grantor expressly agrees that its Obligations and the Liens upon
its Property granted herein shall not be affected or diminished by the addition
or release of additional Grantors hereunder, nor by any election of Secured
Party not to cause any Significant Domestic Subsidiary of the Borrower to become
an additional Grantor hereunder. This Agreement shall be fully effective as to
any Grantor who is or becomes a party hereto regardless of whether any other
Person becomes or fails to become or ceases to be a Grantor hereunder.
18. Release of Grantors. This Agreement and all Obligations of
Grantors hereunder shall be released when all Obligations have been paid in full
in cash or otherwise performed in full and when no portion of the respective
Commitments of the Lenders remains outstanding. Upon such release of Grantors'
Obligations hereunder, Secured Party shall promptly
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return any pledged Collateral to Grantors, or to the Person or Persons legally
entitled thereto, and shall promptly endorse, execute, deliver, record and file
all instruments and documents, and do all other acts and things, reasonably
required for the return of the Collateral to Grantors, or to the Person or
Persons legally entitled thereto, and to evidence or document the release of
Secured Party's interests arising under this Agreement, all as reasonably
requested by, and at the sole expense of, Grantors.
19. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which, taken
together, shall constitute one and the same agreement.
20. Additional Powers and Authorization. Secured Party shall be
entitled to the benefits accruing to it as the Administrative Agent under the
Loan Agreement. Notwithstanding anything contained herein to the contrary,
Secured Party may employ agents, trustees, or attorneys-in-fact and may vest any
of them with any Property (including, without limitation, any Collateral pledged
hereunder), title, right or power deemed necessary for the purposes of such
appointment.
21. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA.
22. WAIVER OF JURY TRIAL. EACH GRANTOR AND SECURED PARTY EXPRESSLY
WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE
LOAN AGREEMENT, THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY
OR THEREBY IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY
ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR PARTIES, WHETHER NOW EXISTING OR
HEREAFTER ARISING AND WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR
OTHERWISE. EACH GRANTOR AND SECURED PARTY AGREE THAT ANY SUCH CLAIM, DEMAND,
ACTION OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY.
WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE
RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY
ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO
CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT, THE LOAN AGREEMENT
OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS
TO THIS AGREEMENT, THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS. ANY PARTY
HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT
AS WRITTEN
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EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT
TO TRIAL BY JURY.
IN WITNESS WHEREOF, each Grantor has executed this Agreement by
its duly authorized officer as of the date first written above.
"Grantors"
VIASAT, INC.,
a Delaware corporation
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
VIASAT WORLDWIDE LIMITED,
a Delaware corporation
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
VIASAT CHINA SERVICES, INC.
a Delaware corporation
By:
-------------------------------------
Name:
-----------------------------------
Title:
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ACCEPTED AND AGREED
AS OF THE DATE FIRST
ABOVE WRITTEN:
"Secured Party"
UNION BANK OF CALIFORNIA, N.A.,
as Administrative Agent,
for and on behalf of the Lenders
By:
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Name:
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Title:
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EXHIBIT A
TO
SECURITY AGREEMENT
INSTRUMENT OF JOINDER
THIS INSTRUMENT OF JOINDER (this "Joinder") is executed as of
_____________________, ______, by ___________________________, a
______________________ ("Joining Party"), and delivered to Union Bank of
California, N.A., as Administrative Agent, pursuant to the Security Agreement
(the "Security Agreement"), dated as of June 21, 2001, as amended or
supplemented from time to time, made by ViaSat, Inc., a Delaware corporation
(the "Borrower"), and those Subsidiaries of the Borrower that are parties
thereto (collectively with the Borrower, the "Grantors") in favor of the
Administrative Agent and the Lenders referred to in the Loan Agreement described
below. Terms used but not defined in this Joinder shall have the meanings
defined for those terms in the Security Agreement.
RECITALS
(A) The Security Agreement was made by the Grantors in favor of
the Administrative Agent for the ratable benefit of the Lenders that are parties
to that certain Revolving/Term Loan Agreement dated as of June 21, 2001, by and
among the Borrowers which are parties thereto, the Lenders which are parties
thereto and Union Bank of California, N.A., as the Administrative Agent for the
Lenders.
(B) Joining Party has become a Borrower under the Loan Agreement
and, as such, is required to become a party to the Security Agreement.
(C) Joining Party expects to realize direct and indirect benefits
as a result of the availability to the Borrowers of the credit facilities under
the Loan.
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NOW THEREFORE, Joining Party agrees as follows:
AGREEMENT
(1) By this Joinder, Joining Party becomes a party to the Security
Agreement as an additional joint and several "Grantor." Joining Party agrees
that, upon its execution hereof, it will become a Grantor under the Security
Agreement with respect to all Obligations heretofore or hereafter incurred under
the Loan Documents, and will be bound by all terms, conditions, and duties
applicable to a Grantor under the Security Agreement.
(2) Concurrent with the Joining Party's execution and delivery of
this Joinder to Secured Party, and at any time and from time to time at the
request of Secured Party, Joining Party shall execute and deliver to Secured
Party all such financing statements and other agreements, instruments or
documents in form and substance satisfactory to Secured Party as shall be
reasonably necessary or desirable to perfect fully, when filed and/or recorded,
and to ensure the first-priority status of, Secured Party's security interests
in the Collateral.
(3) THIS JOINDER SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA.
(4) The effective date of this Joinder is ____________,______ .
"Joining Party"
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a
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By:
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Title:
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ACKNOWLEDGED:
UNION BANK OF CALIFORNIA, N.A.,
as Administrative Agent
By:
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Name:
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Title:
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EXHIBIT B
TO
SECURITY AGREEMENT
SURETYSHIP PROVISIONS AND WAIVERS
1. Waivers and Consents. Each Grantor acknowledges that the Liens
and security interests created or granted herein will or may secure obligations
of Persons other than such Grantor and, in full recognition of that fact, each
Grantor consents and agrees that Secured Party may, at any time and from time to
time, without notice or demand, and without affecting the enforceability or
security hereof:
(a) supplement, modify, amend, extend, renew, or otherwise
change the time for payment or the terms of the Obligations or any part
thereof, including any increase or decrease of the rate(s) of interest
thereon;
(b) supplement, modify, amend or waive, or enter into or
give any agreement, approval or consent with respect to, the Obligations
or any part thereof or any of the Loan Documents or any additional
security or guaranties, or any condition, covenant, default, remedy,
right, representation or term thereof or thereunder;
(c) accept new or additional instruments, documents or
agreements in exchange for or relative to any of the Loan Documents or
the Obligations or any part thereof;
(d) accept partial payments on the Obligations;
(e) receive and hold additional security or guaranties for
the Obligations or any part thereof;
(f) release, reconvey, terminate, waive, abandon,
subordinate, exchange, substitute, transfer and enforce any security or
guaranties, and apply any security and direct the order or manner of sale
thereof as Secured Party in its sole and absolute discretion may
determine;
(g) release any Person or any guarantor from any personal
liability with respect to the Obligations or any part thereof;
(h) settle, release on terms satisfactory to Secured Party
or by operation of applicable laws or otherwise liquidate or enforce any
Obligations and any security or guaranty therefor in any manner, consent
to the transfer of any security and bid and purchase at any sale; and
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(i) consent to the merger, change or any other
restructuring or termination of the corporate existence of the Borrower
or any other Person, and correspondingly restructure the Obligations, and
any such merger, change, restructuring or termination shall not affect
the liability of any Grantor or the continuing existence of any Liens
hereunder, under any other Loan Document to which any Grantor is a party
or the enforceability hereof or thereof with respect to all or any part
of the Obligations.
Upon the occurrence of and during the continuance of any Event of
Default, Secured Party may enforce this Agreement independently as to each
Grantor and independently of any other remedy or security Secured Party at any
time may have or hold in connection with the Obligations, and it shall not be
necessary for Secured Party to marshal assets in favor of any Grantor, the
Borrower or any other Person or to proceed upon or against and/or exhaust any
other security or remedy before proceeding to enforce this Agreement. Each
Grantor expressly waives any right to require Secured Party to marshal assets in
favor of such Grantor, the Borrower or any other Person or to proceed against
any other Person or any collateral provided by any other Person, and agrees that
Secured Party may proceed against any Person and/or collateral in such order as
it shall determine in its sole and absolute discretion. Secured Party may file a
separate action or actions against any Grantor, whether action is brought or
prosecuted with respect to any other security or against any other Grantor, the
Borrower or any other Person, or whether any other Person is joined in any such
action or actions. Each Grantor agrees that Secured Party and the Borrower and
any other Person may deal with each other in connection with the Obligations or
otherwise, or alter any contracts or agreements now or hereafter existing
between any of them, in any manner whatsoever, all without in any way altering
or affecting the security of this Agreement. Secured Party's rights hereunder
shall be reinstated and revived, and the enforceability of this Agreement shall
continue, with respect to any amount at any time paid on account of the
Obligations which thereafter shall be required to be restored or returned by
Secured Party upon the bankruptcy, insolvency or reorganization of the Borrower,
any Grantor or any other Person, or otherwise, all as though such amount had not
been paid. The Liens created or granted herein and the enforceability of this
Agreement at all times shall remain effective to secure the full amount of all
the Obligations, including, without limitation, the amount of all loans and
interest thereon at the rates provided for in the Loan Agreement and the note(s)
thereunder, even though the Obligations, including any part thereof or any other
security or guaranty therefor, may be or hereafter may become invalid or
otherwise unenforceable as against the Borrower or any other Person and whether
or not the Borrower or any other Person shall have any personal liability with
respect thereto. Each Grantor expressly waives any and all defenses now or
hereafter arising or asserted by reason of (a) any disability or other defense
of the Borrower or any other Person with respect to the Obligations, (b) the
unenforceability or invalidity of any security or guaranty for the Obligations
or the lack of perfection or continuing perfection or failure of priority of any
security for the Obligations, (c) the cessation for any cause whatsoever of the
liability of the Borrower or any other Person (other than by reason of the full
payment and performance of all Obligations), (d) any failure of Secured Party to
marshal assets in favor of such Grantor or any other Person, (e) except as
otherwise required by Law or as provided in this Agreement, any failure of
Secured Party to give notice of sale or other disposition of collateral to such
Grantor or any other Person or any defect in any notice that may be
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given in connection with any sale or disposition of collateral, (f) except as
otherwise required by Law or as provided in this Agreement, any failure of
Secured Party to comply with applicable Laws in connection with the sale or
other disposition of any collateral or other security for any Obligation,
including without limitation any failure of Secured Party to conduct a
commercially reasonable sale or other disposition of any collateral or other
security for any Obligation, (g) any act or omission of Secured Party or others
that directly or indirectly results in or aids the discharge or release of the
Borrower, any Grantor or any other Person or the Obligations or any other
security or guaranty therefor by operation of law, (h) any Law which provides
that the obligation of a surety or guarantor must neither be larger in amount
nor in other respects more burdensome than that of the principal or which
reduces a surety's or guarantor's obligation in proportion to the principal
obligation, (i) any failure of Secured Party to file or enforce a claim in any
bankruptcy or other proceeding with respect to any Person, (j) the election by
Secured Party, in any bankruptcy proceeding of any Person, of the application or
non-application of Section 1111(b)(2) of the United States Bankruptcy Code, (k)
any extension of credit or the grant of any Liens under Section 364 of the
United States Bankruptcy Code, (l) any use of cash collateral under Section 363
of the United States Bankruptcy Code, (m) any agreement or stipulation with
respect to the provision of adequate protection in any bankruptcy proceeding of
any Person, (n) the avoidance of any Liens in favor of Secured Party for any
reason, (o) any bankruptcy, insolvency, reorganization, arrangement,
readjustment of debt, liquidation or dissolution proceeding commenced by or
against any Person, including any discharge of, or bar or stay against
collecting, all or any of the Obligations (or any interest thereon) in or as a
result of any such proceeding, or (p) to the extent permitted, the benefit of
any form of the one-action rule. Until no part of any commitment to lend
remains outstanding and all of the Obligations have been paid and performed in
full, Grantors shall have no right of subrogation, contribution, reimbursement
or indemnity, and each Grantor expressly waives any right to enforce any remedy
that Secured Party now has or hereafter may have against any other Person and
waives the benefit of, or any right to participate in, any other security now or
hereafter held by Secured Party. Until the Obligations have been paid in full,
each Grantor expressly waives all setoffs and counterclaims and all
presentments, demands for payment or performance, notices of nonpayment or
nonperformance, protests, notices of protest, notices of dishonor and all other
notices or demands of any kind or nature whatsoever with respect to the
Obligations, and all notices of acceptance of this Agreement or of the
existence, creation or incurring of new or additional Obligations.
2. Condition of the Borrower and Its Subsidiaries. Each Grantor
represents and warrants to Secured Party that such Grantor has established
adequate means of obtaining from the Borrower and its Subsidiaries, on a
continuing basis, financial and other information pertaining to the businesses,
operations and condition (financial and otherwise) of the Borrower and its
Subsidiaries and their properties, and such Grantor now is and hereafter will be
completely familiar with the businesses, operations and condition (financial and
otherwise) of the Borrower and its Subsidiaries and their properties. Each
Grantor hereby expressly waives and relinquishes any duty on the part of Secured
Party to disclose to such Grantor any matter, fact or thing related to the
businesses, operations or condition (financial or otherwise) of the Borrower or
its Subsidiaries or their properties, whether now known or hereafter known by
Secured Party during the life of this Agreement. With respect to any of the
Obligations, Secured Party need not inquire into the powers
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of the Borrower or any Subsidiaries thereof or the officers or employees acting
or purporting to act on their behalf, and all Obligations made or created in
good faith reliance upon the professed exercise of such powers shall be secured
hereby.
3. Waiver of Rights of Subrogation. Notwithstanding anything to
the contrary elsewhere contained herein or in any other Loan Document to which
any Grantor is a Party, until the Obligations have been satisfied in full, each
Grantor hereby waives with respect to the Borrower and its successors and
assigns (including any surety) and any other Party any and all rights at Law or
in equity, to subrogation, to reimbursement, to exoneration, to contribution, to
setoff or to any other rights that could accrue to a surety against a principal,
to a guarantor against a maker or obligor, to an accommodation party against the
party accommodated, or to a holder or transferee against a maker and which such
Grantor may have or hereafter acquire against the Borrower or any other Party in
connection with or as a result of such Grantor's execution, delivery and/or
performance of this Agreement or any other Loan Document to which such Grantor
is a party. Until the Obligations have been satisfied in full, each Grantor
agrees that it shall not have or assert any such rights against the Borrower or
its successors and assigns or any other Person (including any surety), either
directly or as an attempted setoff to any action commenced against such Grantor
by the Borrower (as borrower or in any other capacity) or any other Person. Each
Grantor hereby acknowledges and agrees that this waiver is intended to benefit
Secured Party and shall not limit or otherwise affect such Grantor's liability
hereunder, under any other Loan Document to which such Grantor is a party, or
the enforceability hereof or thereof.
4. Understandings with Respect to Waivers and Consents. Each
Grantor warrants and agrees that each of the waivers and consents set forth
herein is made with full knowledge of its significance and consequences, with
the understanding that events giving rise to any defense waived may diminish,
destroy or otherwise adversely affect rights which such Grantor otherwise may
have against the Borrower, Secured Party or others, or against collateral, and
that, under the circumstances, the waivers and consents herein given are
reasonable and not contrary to public policy or Law. If any of the waivers or
consents herein are determined to be contrary to any applicable Law or public
policy, such waivers and consents shall be effective to the maximum extent
permitted by law.
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EXHIBIT J
TERM NOTE
$84,021.05 June 21, 2001
Los Angeles, California
FOR VALUE RECEIVED, the undersigned promises to pay to the order of
UNION BANK OF CALIFORNIA, N.A. (the "Lender"), the principal amount of EIGHTY-
FOUR THOUSAND TWENTY-ONE AND 05/100 DOLLARS ($84,021.05), payable as hereinafter
set forth. The undersigned promises to pay interest on the principal amount
hereof remaining unpaid from time to time from the date hereof until the date of
payment in full, payable as hereinafter set forth.
Reference is made to the Revolving/Term Loan Agreement, of even date
herewith, by and among the undersigned, as Borrower, the Lenders which are
parties thereto, and UNION BANK OF CALIFORNIA, N.A., as Administrative Agent for
the Lenders (as amended, extended, renewed, supplemented or otherwise modified
from time to time, the "Loan Agreement"). Terms defined in the Loan Agreement
and not otherwise defined herein are used herein with the meanings given those
terms in the Loan Agreement. This is one of the Term Notes referred to in the
Loan Agreement, and any holder hereof is entitled to all of the rights,
remedies, benefits and privileges provided for in the Loan Agreement as
originally executed or as it may from time to time be supplemented, modified or
amended. The Loan Agreement, among other things, contains provisions for
acceleration of the maturity hereof upon the happening of certain stated events
upon the terms and conditions therein specified.
The principal indebtedness evidenced by this Note shall be payable
as follows:
(i) two (2) equal consecutive monthly payments of TWENTY-EIGHT
THOUSAND SEVEN AND 01/100 DOLLARS ($28,007.01) each, on July 15, 2001
and on August 15, 2001; and
(ii) one (1) final payment of TWENTY-EIGHT THOUSAND SEVEN AND
01/100 DOLLARS ($28,007.03) on the Term Loan Maturity Date.
Interest shall be payable on the outstanding daily unpaid principal
amount of the Advance from the date thereof until payment in full and shall
accrue and be
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payable at the rates and on the dates set forth in the Loan Agreement both
before and after default and before and after maturity and judgment, with
interest on overdue principal and interest to bear interest at the rate set
forth in Section 3.7 of the Loan Agreement, to the fullest extent permitted by
applicable Law.
Each payment hereunder shall be made to the Administrative Agent at
the Administrative Agent's Office for the account of the Lender in immediately
available funds not later than 11:00 a.m. (California time) on the day of
payment (which must be a Banking Day). All payments received after 11:00 a.m.
(California time) on any particular Banking Day shall be deemed received on the
next succeeding Banking Day. All payments shall be made in lawful money of the
United States of America.
The Lender shall use its best efforts to keep a record of payments
of principal and interest received by it with respect to this Note, and such
record shall be presumptive evidence of the amounts owing under this Note.
The undersigned hereby promises to pay all costs and expenses of any
rightful holder hereof incurred in collecting the undersigned's obligations
hereunder in accordance with the Loan Agreement or in enforcing or attempting to
enforce any of such holder's rights hereunder, including reasonable attorneys'
fees and disbursements, whether or not an action is filed in connection
therewith.
The undersigned hereby waives presentment, demand for payment,
dishonor, notice of dishonor, protest, notice of protest and any other notice or
formality, to the fullest extent permitted by applicable Laws.
THIS NOTE SHALL BE DELIVERED TO AND ACCEPTED BY THE LENDER, OR BY
THE ADMINISTRATIVE AGENT ON BEHALF OF THE LENDER, IN THE STATE OF CALIFORNIA,
AND SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE
LOCAL LAWS THEREOF.
VIASAT, INC.,
a Delaware corporation
By: ___________________________________
Name: _________________________________
Title: ________________________________
SCHEDULE OF ADVANCES AND
PAYMENTS OF PRINCIPAL
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Amount of Unpaid
Interest Principal Principal Notation
Date Period Paid Balance Made by
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