Exhibit 10.1
Execution Copy
REVOLVING CREDIT AGREEMENT
dated as of May 15, 2003
among
HEICO CORPORATION,
as Borrower
THE LENDERS FROM TIME TO TIME PARTY HERETO
and
SUNTRUST BANK,
as Administrative Agent
SUNTRUST CAPITAL MARKETS, INC.,
as Lead Arranger and Book Manager
TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS; CONSTRUCTION........................................1
Section 1.1.Definitions..................................................1
Section 1.2.Classifications of Loans and Borrowings.....................22
Section 1.3.Accounting Terms and Determination..........................22
Section 1.4.Terms Generally.............................................23
ARTICLE II AMOUNT AND TERMS OF THE COMMITMENTS.............................23
Section 2.1.General Description of Facilities...........................23
Section 2.2.Revolving Loans.............................................24
Section 2.3.Procedure for Revolving Borrowings..........................24
Section 2.4.Swingline Commitment........................................24
Section 2.5.Procedure for Swingline Loan; Etc...........................25
Section 2.6.Conversion of Revolving Loans to Term Loans.................26
Section 2.7.Funding of Borrowings.......................................27
Section 2.8.Interest Elections..........................................28
Section 2.9.Optional Reduction and Termination of Commitments...........29
Section 2.10.Repayment of Loans.........................................30
Section 2.11.Evidence of Indebtedness...................................30
Section 2.12.Optional Prepayments.......................................30
Section 2.13.Mandatory Prepayments......................................31
Section 2.14.Interest on Loans..........................................32
Section 2.15.Fees.......................................................33
Section 2.16.Computation of Interest and Fees...........................34
Section 2.17.Inability to Determine Interest Rates......................34
Section 2.18.Illegality.................................................34
Section 2.19.Increased Costs............................................35
Section 2.20.Funding Indemnity..........................................36
Section 2.21.Taxes......................................................36
Section 2.22.Payments Generally; Pro Rata Treatment; Sharing of
Set-offs.......................................................38
Section 2.23. Letters of Credit.........................................39
Section 2.24.Extension of Revolving Commitment Termination Date.........44
ARTICLE III CONDITIONS PRECEDENT TO LOANS AND LETTERS OF CREDIT.............45
Section 3.1.Conditions To Effectiveness.................................45
Section 3.2.Each Credit Event...........................................48
Section 3.3.Delivery of Documents.......................................48
ARTICLE IV REPRESENTATIONS AND WARRANTIES..................................49
Section 4.1.Corporate Existence; Compliance with Law; Name History......49
Section 4.2.Corporate Power and Authorization to Execute Loan
Documents; No Conflict; No Consent.............................49
Section 4.3.Enforceable Obligations.....................................50
Section 4.4.Financial Condition.........................................50
Section 4.5.No Litigation...............................................50
Section 4.6.Investment Company Act; Regulation..........................51
Section 4.7.Disclosure and No Untrue Statements.........................51
Section 4.8.Title to Assets; Leases in Good Standing....................52
Section 4.9.Payment of Taxes............................................52
Section 4.10.No Default Under Agreement or Instruments; Compliance
with Laws......................................................52
Section 4.11.Patents, Trademarks, Licenses, Etc.........................52
Section 4.12.Government Contract........................................53
Section 4.13.ERISA Requirement..........................................53
Section 4.14.Solvency...................................................53
Section 4.15.Location of Offices........................................53
Section 4.16.Insurance..................................................53
Section 4.17.Labor Relations............................................54
ARTICLE V AFFIRMATIVE COVENANTS...........................................54
Section 5.1. Financial Reports and Other Information....................54
Section 5.2.Payment of Indebtedness to Administrative Agent;
Performance of Other Covenants; Payment of Other Obligations...56
Section 5.3.Conduct of Business; Maintenance of Existence and Rights....56
Section 5.4.Maintenance of Property.....................................56
Section 5.5.Right of Inspection; Discussions............................56
Section 5.6.Notices.....................................................56
Section 5.7.Payment of Taxes; Liens.....................................58
Section 5.8.Insurance of Properties.....................................58
Section 5.9.True Books..................................................59
Section 5.10.Observance of Laws.........................................59
Section 5.11.Further Assurances.........................................59
Section 5.12.ERISA Benefit Plans........................................59
Section 5.13.Withholding Taxes..........................................59
Section 5.14.Change of Name, Principal Place of Business, Office, or
Registered Agent...............................................60
Section 5.15.Intentionally Omitted......................................60
Section 5.16.Use of Proceeds and Letters of Credit Affirmative
Covenants......................................................60
Section 5.17.Additional Subsidiaries....................................60
Section 5.18.Additional Leased Locations................................61
ARTICLE VI FINANCIAL COVENANTS.............................................62
Section 6.1.Financial Covenants.........................................62
ARTICLE VII NEGATIVE COVENANTS..............................................62
Section 7.1.Other Indebtedness..........................................62
Section 7.2.Limitations on Mortgages, Liens, Etc........................63
Section 7.3.Guaranties..................................................64
Section 7.4.Merger, Acquisition, Sale of Assets, Dissolution, Etc.......65
Section 7.5.Investments, Loans, etc.....................................66
Section 7.6.Federal Reserve Regulations.................................67
Section 7.7.Changes in Governing Documents, Accounting Methods, Fiscal
Year...........................................................67
Section 7.8.Capital Expenditures........................................67
Section 7.9.Dividends, Etc..............................................68
Section 7.10.Change in Control..........................................68
Section 7.11.HEICO Aerospace Holdings Corp..............................68
Section 7.12.Transactions with Affiliates...............................69
Section 7.13.Restrictive Agreements.....................................70
Section 7.14.Sale and Leaseback Transactions............................70
Section 7.15.Hedging Transactions.......................................70
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ARTICLE VIII EVENTS OF DEFAULT...............................................71
Section 8.1.Events of Default...........................................71
Section 8.2.Application of Proceeds from Collateral.....................73
ARTICLE IX THE ADMINISTRATIVE AGENT........................................74
Section 9.1.Appointment of Administrative Agent.........................74
Section 9.2.Nature of Duties of Administrative Agent....................75
Section 9.3.Lack of Reliance on the Administrative Agent................75
Section 9.4.Certain Rights of the Administrative Agent..................76
Section 9.5.Reliance by Administrative Agent............................76
Section 9.6.The Administrative Agent in its Individual Capacity.........76
Section 9.7.Successor Administrative Agent..............................76
Section 9.8.Authorization to Execute other Loan Documents...............77
ARTICLE X MISCELLANEOUS...................................................77
Section 10.1.Notices....................................................77
Section 10.2.Waiver; Amendments.........................................79
Section 10.3.Expenses; Indemnification..................................80
Section 10.4.Successors and Assigns.....................................82
Section 10.5.Governing Law; Jurisdiction; Consent to Service of
Process.......................................................84
Section 10.6.WAIVER OF JURY TRIAL.......................................85
Section 10.7.Right of Setoff............................................85
Section 10.8.Counterparts; Integration..................................85
Section 10.9.Survival...................................................86
Section 10.10.Severability..............................................86
Section 10.11.Confidentiality...........................................86
Section 10.12.Interest Rate Limitation..................................87
Section 10.13.Waiver of Effect of Corporate Seal........................87
Schedules
Schedule I - Applicable Margin and Applicable Commitment Fee
Percentage
Schedule 4.5 - Litigation
Schedule 7.1 - Indebtedness
Schedule 7.2 - Liens
Schedule 7.5 - Investments
Exhibits
Exhibit A - Form of Syndicated Note
Exhibit B - Form of Swingline Note
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Subsidiary Guaranty Agreement
Exhibit 2.3 - Form of Notice of Revolving Borrowing
Exhibit 2.5 - Form of Notice of Swingline Loan
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Exhibit 2.8 - Form of Continuation/Conversion
Exhibit 3.1(b)(ix) - Form of Secretary's Certificate
Exhibit 3.1(b)(xii) - Form of Officer's Certificate
Exhibit 5.1(g) - Form of Compliance Certificate
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REVOLVING CREDIT AGREEMENT
THIS REVOLVING CREDIT AGREEMENT (this "Agreement") is made and
entered into as of May 15, 2003, by and among HEICO CORPORATION, a Florida
corporation (the "Borrower"), the several banks and other financial institutions
and lenders from time to time party hereto (the "Lenders"), and SUNTRUST BANK,
in its capacity as administrative agent for the Lenders (the "Administrative
Agent"), as issuing bank (the "Issuing Bank") and as swingline lender (the
"Swingline Lender").
W I T N E S S E T H:
WHEREAS, the Borrower has requested that the Lenders establish a
$120,000,000 revolving credit facility in favor of the Borrower that, at the
option of the Borrower, may be converted into a one-year fully amortizing term
loan facility;
WHEREAS, subject to the terms and conditions of this Agreement,
the Lenders, the Issuing Bank and the Swingline Lender (to the extent of their
respective Commitments as defined herein) are willing severally to establish the
requested revolving credit facility, letter of credit subfacility and swingline
subfacility in favor of the Borrower.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the Borrower, the Lenders, the Administrative Agent,
the Issuing Bank and the Swingline Lender agree as follows:
ARTICLE I
DEFINITIONS; CONSTRUCTION
Section 1.1. Definitions. In addition to the other terms
defined herein, the following terms used herein shall have the meanings set
forth herein (to be equally applicable to both the singular and plural forms of
the terms defined):
"Adjusted LIBO Rate" shall mean, with respect to each Interest
Period for a Eurodollar Borrowing, the rate per annum obtained by dividing (i)
LIBOR for such Interest Period by (ii) a percentage equal to 1.00 minus the
Eurodollar Reserve Percentage.
"Administrative Agent" shall have the meaning set forth in the
introductory paragraph hereof.
"Administrative Questionnaire" shall mean, with respect to each
Lender, an administrative questionnaire in the form prepared by the
Administrative Agent and submitted to the Administrative Agent duly completed by
such Lender.
"Affiliate" shall mean, as to any Person, any other Person that
directly, or indirectly through one or more intermediaries, Controls, is
Controlled by, or is under common Control with, such Person. For the purposes of
this definition of Affiliate, the term "Control" shall mean the power, directly
or indirectly, either to (i) vote 10% or more of the securities having ordinary
voting power for the election of directors (or persons performing similar
functions) of a Person or (ii) direct or cause the direction of the management
and policies of a Person, whether through the ability to exercise voting power,
by contract or otherwise. The terms "Controlling," "Controlled by," and "under
common Control with" have the meanings correlative thereto. Notwithstanding the
foregoing, Lufthansa Technik AG and its Affiliates shall not be deemed
Affiliates of the Borrower and its Affiliates solely by virtue of Mr. Wolfgang
Mayrhuber, or any other designee of Lufthansa Technick AG, serving as an officer
or director of any such entity.
"AFI Option Agreement" shall mean that certain Stock Option
Agreement dated as of October 12, 2001, by and between Aviation Facilities,
Inc., a Florida corporation, and AFI Acquisition Corp., a Florida corporation.
"Aggregate Revolving Commitment Amount" shall mean the aggregate
principal amount of the Aggregate Revolving Commitments from time to time. On
the Closing Date, the Aggregate Revolving Commitment Amount equals $120,000,000.
"Aggregate Revolving Commitments" shall mean, collectively, all
Revolving Commitments of all Lenders at any time outstanding.
"Applicable Commitment Fee Percentage" shall mean, as of any
date, with respect to the commitment fee in Section 2.15(b), the percentage per
annum determined by reference to the applicable Leverage Ratio in effect on such
date as set forth on Schedule I; provided, that a change in the Applicable
Commitment Fee Percentage resulting from a change in the Leverage Ratio shall be
effective on the second Business Day after which the Borrower delivers the
financial statements required by Section 5.1(a) or (b) and the Compliance
Certificate required by Section 5.1(g); provided, further, that if at any time
the Borrower shall have failed to deliver such financial statements and such
Compliance Certificate when so required, the Applicable Commitment Fee
Percentage shall be at Level V as set forth on Schedule I until such time as
such financial statements and certificate are delivered, at which time the
Applicable Commitment Fee Percentage shall be determined as provided above.
Notwithstanding the foregoing, the Applicable Commitment Fee Percentage from the
Closing Date until the financial statements and Compliance Certificate for the
Fiscal Quarter ending July 31, 2003 are delivered (or required to be delivered
if no such financial statements and Compliance Certificate are delivered) shall
be at Level III as set forth on Schedule I.
"Applicable Lending Office" shall mean, for each Lender and for
each Type of Loan, the "Lending Office" of such Lender (or an Affiliate of such
Lender) designated for such Type of Loan in the Administrative Questionnaire
submitted by such Lender or such other office of such Lender (or an Affiliate of
such Lender) as such Lender may from time to time specify to the Administrative
Agent and the Borrower as the office by which its Loans of such Type are to be
made and maintained.
"Applicable Margin" shall mean, as of any date, (i) with respect
to all Revolving Loans outstanding on any date and the letter of credit fee, as
the case may be, a percentage per annum determined by reference to the
applicable Leverage Ratio in effect on such date as set forth on Schedule I;
provided, that a change in the Applicable Margin resulting from a change in the
Leverage Ratio shall be effective on the second Business Day after which the
Borrower
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delivers the financial statements required by Section 5.1(a) or (b) and the
Compliance Certificate required by Section 5.1(g); provided, further, that if at
any time the Borrower shall have failed to deliver such financial statements and
such Compliance Certificate when so required, the Applicable Margin shall be at
Level V as set forth on Schedule I until such time as such financial statements
and certificate are delivered, at which time the Applicable Margin shall be
determined as provided above. Notwithstanding the foregoing, the Applicable
Margin from the Closing Date until the financial statements and Compliance
Certificate for the Fiscal Quarter ending July 31, 2003 are delivered (or
required to be delivered if no such financial statements and Compliance
Certificate are delivered) shall be at Level III as set forth on Schedule I; and
(ii) with respect to any Term Loans outstanding after the Revolving Commitment
Termination Date, the percentage per annum contained in the Applicable Margin
Notice delivered by the Lenders pursuant to Section 2.6(b), subject to such
changes as are set forth in such Applicable Margin Notice.
"Approved Fund" shall mean any Person (other than a natural
Person) that is (or will be) engaged in making, purchasing, holding or otherwise
investing in commercial loans and similar extensions of credit in the ordinary
course of its business and that is administered or managed by (i) a Lender, (ii)
an Affiliate of a Lender or (iii) an entity or an Affiliate of an entity that
administers or manages a Lender.
"Assignment and Acceptance" shall mean an assignment and
acceptance entered into by a Lender and an assignee (with the consent of any
party whose consent is required by Section 10.4(b)) and accepted by the
Administrative Agent, in the form of Exhibit C attached hereto or any other form
approved by the Administrative Agent.
"Availability Period" shall mean the period from the Closing
Date to the Revolving Commitment Termination Date.
"Base Rate" shall mean the higher of (i) the per annum rate
which the Administrative Agent publicly announces from time to time to be its
prime lending rate, as in effect from time to time, and (ii) (A) the Federal
Funds Rate, as in effect from time to time, plus (B) one-half of one percent
(0.50%) per annum. The Administrative Agent's prime lending rate is a reference
rate and does not necessarily represent the lowest or best rate charged to
customers. The Administrative Agent may make commercial loans or other loans at
rates of interest at, above or below the Administrative Agent's prime lending
rate. Each change in the Administrative Agent's prime lending rate shall be
effective from and including the date such change is publicly announced as being
effective.
"Blocked Account" shall mean a deposit or disbursement bank
account in the name of any Loan Party with the Administrative Agent, with other
Lenders or with any other financial institutions that (together with the
applicable Loan Party) have executed and delivered to the Administrative Agent a
Blocked Account Agreement, in form and substance reasonably acceptable to the
Administrative Agent.
"Blocked Account Agreement" shall mean an agreement between the
Administrative Agent and a deposit account bank with respect to a deposit or
disbursement bank account in the name of any Loan Party, whereby, among other
things, the deposit account bank disclaims or subordinates in a manner
acceptable to the Administrative Agent any security
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interest in the applicable deposit or disbursement bank account, acknowledges
the Lien of the Administrative Agent, on behalf of itself and Lenders, on such
account, and after the occurrence and during the continuance of an Event of
Default agrees to follow the instructions or entitlement orders of the
Administrative Agent without further consent by the affected Loan Party.
"Bond Documents" shall mean the HEICO Aerospace Corporation
Industrial Development Refunding Bonds - Series 1988 - Broward County, Florida
(March 28, 1988), and all other documents executed in connection therewith.
"Borrowing" shall mean a borrowing consisting of (i) Loans of
the same Class and Type, made, converted or continued on the same date and in
the case of Eurodollar Loans, as to which a single Interest Period is in effect,
or (ii) a Swingline Loan.
"Business Day" shall mean (i) any day other than a Saturday,
Sunday or other day on which commercial banks in Atlanta, Georgia are authorized
or required by law to close and (ii) if such day relates to a Borrowing of, a
payment or prepayment of principal or interest on, a conversion of or into, or
an Interest Period for, a Eurodollar Loan or a notice with respect to any of the
foregoing, any day on which dealings in Dollars are carried on in the London
interbank market.
"Capital Expenditures" shall mean for any period, without
duplication, (i) the additions to property, plant and equipment and other
capital expenditures of the Borrower and its Subsidiaries that are (or would be)
set forth on a consolidated statement of cash flows of the Borrower for such
period prepared in accordance with GAAP and (ii) Capital Lease Obligations
incurred by the Borrower and its Subsidiaries during such period.
"Capital Lease Obligations" of any Person shall mean all
obligations of such Person to pay rent or other amounts under any lease of (or
other arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Capital Stock" of any Person shall mean any non-redeemable
capital stock (or in the case of a partnership or limited liability company, the
partners' or members' equivalent equity interest) of such Person, whether common
or preferred.
"Change in Control" shall mean, as applied to the Borrower, that
(a) the Mendelson Reporting Group (as identified in the reports filed with the
United States Securities and Exchange Commission) shall cease beneficially to
own and control at least fifteen (15%) of the combined voting power of all
classes of Capital Stock of the Borrower, or (b) Laurans A. Mendelson shall
cease to be employed as President and Chief Executive Officer of the Borrower or
shall cease actively to manage the Borrower and its Subsidiaries (however,
should Laurans A. Mendelson die or become disabled, such death or disability
alone shall not constitute a Change in Control if and only if two of the three
of Eric A. Mendelson, Victor H. Mendelson and Thomas S. Irwin continue to be
employed as executive officers of the Borrower and continue actively to manage
the Borrower and its Subsidiaries), or (c) during any period of twelve (12)
consecutive
4
calendar months (i) more than fifty percent (50%) of the members of the Board of
Directors of the Borrower who were members on the first day of such period shall
have resigned or been removed or replaced, other than as a result of death,
disability, or change in personal circumstances (provided, however, that any
change in the size or membership of the Board of Directors of the Borrower
necessary or desirable in the Borrower's reasonable discretion to comply with
applicable laws including, without limitation, the Sarbanes-Oxley Act of 2002,
or the rules and regulations of any securities exchange on which the securities
of the Borrower may be listed shall not be considered in determining whether a
"Change in Control" has occurred so long as such change is approved by the then
existing Board of Directors immediately prior to such change), or (ii) any
Person or "Group" (as defined in Section 13(d)(3) of the Securities Exchange Act
of 1934, as amended, but excluding (A) any employee benefit or stock ownership
plans of the Borrower, and (B) members of the Board of Directors and executive
officers of the Borrower as of the date of this Agreement, members of the
immediate families of such members and executive officers, and family trusts and
partnerships established by or for the benefit of any of the foregoing
individuals) shall have acquired more than fifty percent (50%) of the combined
voting power of all classes of common stock of the Borrower, except that the
Borrower's purchase of its common stock outstanding on the date hereof which
results in one or more of the Borrower's shareholders of record as of the date
of this Agreement controlling more than fifty percent (50%) of the combined
voting power of all classes of the common stock of the Borrower shall not
constitute a Change in Control.
"Change in Law" shall mean (i) the adoption of any applicable
law, rule or regulation after the date of this Agreement, (ii) any change in any
applicable law, rule or regulation, or any change in the interpretation or
application thereof, by any Governmental Authority after the date of this
Agreement, or (iii) compliance by any Lender (or its Applicable Lending Office)
or the Issuing Bank (or for purposes of Section 2.19(b), by such Lender's or the
Issuing Bank's holding company, if applicable) with any request, guideline or
directive (whether or not having the force of law) of any Governmental Authority
made or issued after the date of this Agreement.
"Class", when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are Revolving
Loans, Swingline Loans or Term Loans and when used in reference to any
Commitment, refers to whether such Commitment is a Revolving Commitment or a
Swingline Commitment.
"Closing Date" shall mean the date on which the conditions
precedent set forth in Section 3.1 and Section 3.2 have been satisfied or waived
in accordance with Section 10.2.
"Code" shall mean the Internal Revenue Code of 1986, as amended
and in effect from time to time.
"Collateral" shall mean all tangible and intangible personal
property or Real Estate of any Loan Party that is the subject of a Lien granted
pursuant to a Loan Document to the Administrative Agent for the benefit of the
Lenders to secure the whole or any part of the Obligations or any Guarantee
thereof, and shall include, without limitation, all casualty insurance proceeds
and condemnation awards with respect to any of the foregoing.
5
"Commitment" shall mean a Revolving Commitment or a Swingline
Commitment or any combination thereof (as the context shall permit or require).
"Compliance Certificate" shall mean a certificate from the
principal financial officer of the Borrower, in his capacity as such, in the
form of the certificate attached hereto as Exhibit 5.1(g), with regard to the
certifications required of such principal financial officer pursuant to Section
5.1(g).
"Consistent Basis" shall mean, in reference to the application
of GAAP, that the accounting principles observed in the current period are
comparable in all material respects to those applied in the preceding period.
"Consolidated EBITDA" shall mean, for the Borrower and its
Subsidiaries for any period, an amount equal to the sum of (i) Consolidated Net
Income for such period plus (ii) to the extent deducted in determining
Consolidated Net Income for such period, (A) Consolidated Interest Expense, (B)
income tax expense determined on a consolidated basis in accordance with GAAP,
(C) depreciation and amortization determined on a consolidated basis in
accordance with GAAP, (D) minority interest expense determined on a consolidated
basis in accordance with GAAP and (E) non-cash expense for stock options and all
other non-cash charges, determined on a consolidated basis in accordance with
GAAP, in each case for such period.
"Consolidated Fixed Charges" shall mean, for the Borrower and
its Subsidiaries for any period, the sum (without duplication) of (i)
Consolidated Interest Expense for such period paid in cash, (ii) scheduled
principal payments made on Consolidated Total Funded Debt during such period,
and (iii) dividends and distributions to holders of Capital Stock, warrants and
related instruments paid in cash or property other than common stock during such
period.
"Consolidated Interest Expense" shall mean, for the Borrower and
its Subsidiaries for any period determined on a consolidated basis in accordance
with GAAP, the sum of (i) total interest expense, including without limitation
the interest component of any payments in respect of Capital Lease Obligations
capitalized or expensed during such period (whether or not actually paid during
such period) plus (ii) the net amount payable (or minus the net amount
receivable) under Hedging Obligations during such period (whether or not
actually paid or received during such period).
"Consolidated Net Income" shall mean, for the Borrower and its
Subsidiaries for any period, the net income (or loss) of the Borrower and its
Subsidiaries for such period determined on a consolidated basis in accordance
with GAAP but excluding therefrom (to the extent otherwise included therein) (i)
any extraordinary gains or losses, (ii) any gains attributable to write-ups of
assets, (iii) any equity interest of the Borrower or any Subsidiary of the
Borrower in the unremitted earnings of any Person that is not a Subsidiary and
(iv) any income (or loss) of any Person accrued prior to the date it becomes a
Subsidiary or is merged into or consolidated with the Borrower or any Subsidiary
on the date that such Person's assets are acquired by the Borrower or any
Subsidiary.
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"Consolidated Net Worth" shall mean, as of any date, (i) the
total assets of the Borrower and its Subsidiaries that would be reflected on the
Borrower's consolidated balance sheet as of such date prepared in accordance
with GAAP, after eliminating all amounts properly attributable to minority
interests, if any, in the stock and surplus of Subsidiaries, minus (ii) the sum
of (x) the total liabilities of the Borrower and its Subsidiaries that would be
reflected on the Borrower's consolidated balance sheet as of such date prepared
in accordance with GAAP and (y) the amount of any write-up in the book value of
any assets resulting from a revaluation thereof or any write-up in excess of the
cost of such assets acquired reflected on the consolidated balance sheet of the
Borrower as of such date prepared in accordance with GAAP.
"Consolidated Total Funded Debt" shall mean and include, without
duplication, the following obligations of the Borrower and any of its
Subsidiaries: (i) any liability or obligation for borrowed money that under GAAP
is required to be shown on the balance sheet as a liability; (ii) Indebtedness
that is secured by any security interest on property owned by the Borrower or
any Subsidiary (such as capitalized leases, asset securitization vehicles,
conditional sales contracts and similar title retention arrangements),
irrespective of whether or not the Indebtedness secured thereby shall have been
assumed by the Borrower or such Subsidiary; (iii) Guarantees, endorsements
(other than endorsements of negotiable instruments for collection in the
ordinary course of business), and other contingent liabilities, whether direct
or indirect (such as by way of a letter of credit issued for the account of the
Borrower or a Subsidiary) in connection with the obligations for borrowed money,
stock, or dividends of any person; (iv) obligations under any contract providing
for the making of loans, advances, or capital contributions to any person in
order to enable such person primarily to maintain working capital, net worth, or
any other balance sheet condition or to pay debts, dividends, or expenses; and
(v) obligations under any contract which, in economic effect, is substantially
equivalent to a Guarantee of loans, advances or capital contributions of another
person, all as determined with respect to (i) through (v) above for the Borrower
and its Subsidiaries on a consolidated basis, in accordance with GAAP applied on
a Consistent Basis.
"Contractual Obligation" of any Person shall mean any provision
of any security issued by such Person or of any agreement, instrument or
undertaking under which such Person is obligated or by which it or any of the
property in which it has an interest is bound.
"Control Agreement" shall mean an agreement between the
Administrative Agent and (i) a securities intermediary with respect to
securities, whether certificated or uncertificated, securities entitlements and
other financial assets held in a securities account in the name of any Loan
Party, or (ii) a futures commission merchant or clearing house, as applicable,
with respect to commodity accounts and commodity contracts held by any Loan
Party, whereby, among other things, the issuer, securities intermediary or
futures commission merchant disclaims any security interest in the applicable
financial assets, acknowledges the Lien of the Administrative Agent, on behalf
of itself and Lenders, on such financial assets, and agrees, after the
occurrence and during the continuance of an Event of Default, to follow the
instructions or entitlement orders of the Administrative Agent without further
consent by the affected Loan Party.
"Default" shall mean any condition or event that, with the
giving of notice or the lapse of time or both, would constitute an Event of
Default.
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"Default Interest" shall have the meaning set forth in Section
2.14(c).
"Dollar(s)" and the sign "$" shall mean lawful money of the
United States of America.
"Domestic Subsidiary" shall mean each Subsidiary that is not a
Foreign Subsidiary.
"Eligible Assignee" shall mean (i) a Lender; (ii) an Affiliate
of a Lender; (iii) an Approved Fund; and (iv) any other Person (other than a
natural Person) approved by the Administrative Agent, the Issuing Bank, and
unless an Event of Default has occurred and is continuing, the Borrower (each
such approval not to be unreasonably withheld or delayed). If the consent of the
Borrower to an assignment or to an Eligible Assignee is required hereunder
(including a consent to an assignment which does not meet the minimum assignment
thresholds specified in paragraph (b)(i) of Section 10.4), the Borrower shall be
deemed to have given its consent ten (10) Business Days after the date notice
thereof has actually been delivered by the assigning Lender (through the
Administrative Agent) to the Borrower, unless such consent is expressly refused
by the Borrower prior to such tenth Business Day.
"Environmental Laws" shall mean all laws, rules, regulations,
codes, ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by or with any Governmental
Authority, relating in any way to the environment, preservation or reclamation
of natural resources, the management, Release or threatened Release of any
Hazardous Material or to health and safety matters.
"Environmental Liability" shall mean any liability, contingent
or otherwise (including any liability for damages, costs of environmental
investigation and remediation, costs of administrative oversight, fines, natural
resource damages, penalties or indemnities), of the Borrower or any Subsidiary
directly or indirectly resulting from or based upon (i) any actual or alleged
violation of any Environmental Law, (ii) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials, (iii)
any actual or alleged exposure to any Hazardous Materials, (iv) the Release or
threatened Release of any Hazardous Materials or (v) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or imposed
with respect to any of the foregoing.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended from time to time, and any successor statute.
"ERISA Affiliate" shall mean any trade or business (whether or
not incorporated), which, together with the Borrower, is treated as a single
employer under Section 414(b) or (c) of the Code or, solely for the purposes of
Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code.
"ERISA Event" shall mean (i) any "reportable event", as defined
in Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived); (ii)
the existence with respect to any Plan of an "accumulated funding deficiency"
(as defined in Section 412 of the Code or Section 302 of ERISA), whether or not
waived; (iii) the filing pursuant to Section 412(d) of the Code or Section
303(d)
8
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (iv) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan; (v) the receipt by the Borrower or any ERISA Affiliate
from the PBGC or a plan administrator appointed by the PBGC of any notice
relating to an intention to terminate any Plan or Plans or to appoint a trustee
to administer any Plan; (vi) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability with respect to the withdrawal or partial withdrawal
from any Plan or Multiemployer Plan; or (vii) the receipt by the Borrower or any
ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the
Borrower or any ERISA Affiliate of any notice, concerning the imposition of
Withdrawal Liability or a determination that a Multiemployer Plan is, or is
expected to be, insolvent or in reorganization, within the meaning of Title IV
of ERISA.
"Eurodollar" when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, bears
interest at a rate determined by reference to the Adjusted LIBO Rate.
"Eurodollar Reserve Percentage" shall mean the aggregate of the
maximum reserve percentages (including, without limitation, any emergency,
supplemental, special or other marginal reserves) expressed as a decimal
(rounded upwards to the next 1/100th of 1%) in effect on any day to which the
Administrative Agent is subject with respect to the Adjusted LIBO Rate pursuant
to regulations issued by the Board of Governors of the Federal Reserve System
(or any Governmental Authority succeeding to any of its principal functions)
with respect to eurocurrency funding (currently referred to as "eurocurrency
liabilities" under Regulation D). Eurodollar Loans shall be deemed to constitute
eurocurrency funding and to be subject to such reserve requirements without
benefit of or credit for proration, exemptions or offsets that may be available
from time to time to any Lender under Regulation D. The Eurodollar Reserve
Percentage shall be adjusted automatically on and as of the effective date of
any change in any reserve percentage.
"Event of Default" shall have the meaning set forth in Section
8.1.
"Excluded Taxes" shall mean with respect to the Administrative
Agent, any Lender, the Issuing Bank or any other recipient of any payment to be
made by or on account of any obligation of the Borrower hereunder, (i) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (ii) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which any Lender is located and (iii) in the case
of a Foreign Lender, any withholding tax that (x) is imposed on amounts payable
to such Foreign Lender at the time such Foreign Lender becomes a party to this
Agreement, (y) is imposed on amounts payable to such Foreign Lender at any time
that such Foreign Lender designates a new lending office, other than taxes that
have accrued prior to the designation of such lending office that are otherwise
not Excluded Taxes, and (z) is attributable to such Foreign Lender's failure to
comply with Section 2.21(e).
9
"Existing Credit Agreement" shall mean that certain Credit
Agreement, dated as of July 30, 1998, by and among the Borrower, the lenders
from time to time parties thereto and SunTrust Bank, as administrative agent, as
amended or modified prior to the date hereof.
"Federal Funds Rate" shall mean, for any day, the rate per annum
(rounded upwards, if necessary, to the next 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with member banks
of the Federal Reserve System arranged by Federal funds brokers, as published by
the Federal Reserve Bank of New York on the next succeeding Business Day or if
such rate is not so published for any Business Day, the Federal Funds Rate for
such day shall be the average rounded upwards, if necessary, to the next 1/100th
of 1% of the quotations for such day on such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by the Administrative Agent.
"Fee Letter" shall mean that certain fee letter, dated as of
February 5, 2003, executed by SunTrust Capital Markets, Inc. and SunTrust Bank
and accepted by the Borrower.
"Fiscal Quarter" shall mean any fiscal quarter of the Borrower.
"Fiscal Year" shall mean any fiscal year of the Borrower.
"Fixed Charge Coverage Ratio" shall mean, as of any date, the
ratio of (a) (i) Consolidated EBITDA minus (ii) the actual amount paid by the
Borrower and its Subsidiaries in cash on account of Capital Expenditures and
income tax expense to (b) Consolidated Fixed Charges, in each case measured for
the four consecutive Fiscal Quarters ending on or immediately prior to such
date.
"Foreign Lender" shall mean any Lender that is not a United
States person under Section 7701(a)(3) of the Code.
"Foreign Subsidiary" shall mean any Subsidiary that is organized
under the laws of a jurisdiction other than one of the fifty states of the
United States or the District of Columbia.
"GAAP" shall mean generally accepted accounting principles in
the United States applied on a consistent basis and subject to the terms of
Section 1.3.
"Governmental Authority" shall mean the government of the United
States of America, any other nation or any political subdivision thereof,
whether state or local, and any agency, authority, instrumentality, regulatory
body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.
"Guarantee" of or by any Person (the "guarantor") shall mean any
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "primary obligor") in any manner, whether directly or
indirectly and including any obligation, direct or indirect, of the guarantor
(i) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (ii) to
purchase or lease property, securities or
10
services for the purpose of assuring the owner of such Indebtedness or other
obligation of the payment thereof, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity of the primary
obligor so as to enable the primary obligor to pay such Indebtedness or other
obligation or (iv) as an account party in respect of any letter of credit or
letter of guaranty issued in support of such Indebtedness or obligation;
provided, that the term "Guarantee" shall not include endorsements for
collection or deposits in the ordinary course of business. The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which Guarantee is made (subject
to any limitations on the liability of the guarantor contained in such
Guarantee) or, if not so stated or determinable, the reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder) as determined by such Person in good faith. The term "Guarantee"
used as a verb has a corresponding meaning.
"Hazardous Materials" shall mean all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or asbestos
containing materials, polychlorinated biphenyls, radon gas, infectious or
medical wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law.
"Hedging Obligations" shall mean, for any Person, any and all
obligations of such Person, whether absolute or contingent and howsoever and
whensoever created, arising, evidenced or acquired under (i) any and all Hedging
Transactions, (ii) any and all cancellations, buy backs, reversals, terminations
or assignments of any Hedging Transactions and (iii) any and all renewals,
extensions and modifications of any Hedging Transactions and any and all
substitutions for any Hedging Transactions, including without limitation any
promissory notes issued to pay the Net Mark-to-Market Exposure of any Hedging
Transactions that is terminated.
"Hedging Transaction" shall mean, for any Person, any
transaction (including an agreement with respect thereto) now existing or
hereafter entered into by such Person that is a rate swap, basis swap, forward
rate transaction, commodity swap, interest rate option, foreign exchange
transaction, cap transaction, floor transaction, collateral transaction, forward
transaction, currency swap transaction, cross-currency rate swap transaction,
currency option or any other similar transaction (including any option with
respect to any of these transactions) or any combination thereof, whether linked
to one or more interest rates, foreign currencies, commodity prices, equity
prices or other financial measures.
"Indebtedness" of any Person shall mean, without duplication (i)
all obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person in respect of the deferred purchase price of
property or services (other than trade payables incurred in the ordinary course
of business and paid in accordance with the historical practices or to the
extent that any of such trade payables are being disputed in good faith and by
appropriate measures), (iv) all obligations of such Person under any conditional
sale or other title retention agreement(s) relating to property acquired by such
Person, (v) all Capital Lease Obligations of such Person, (vi) all obligations,
contingent or otherwise, of such Person in respect of letters of credit,
acceptances or similar extensions of credit, (vii) all Guarantees of such Person
of the type of Indebtedness described in clauses (i) through (vi) above, (viii)
all Indebtedness of a third party
11
secured by any Lien on property owned by such Person, whether or not such
Indebtedness has been assumed by such Person, (ix) all obligations of such
Person, contingent or otherwise, to purchase, redeem, retire or otherwise
acquire for value any common stock of such Person, (x) Off-Balance Sheet
Liabilities and (xi) all Hedging Obligations of such Person. The Indebtedness of
any Person shall include the Indebtedness of any partnership or joint venture in
which such Person is a general partner or a joint venturer to the extent
required to be consolidated in accordance with GAAP, except to the extent that
the terms of such Indebtedness provide that such Person is not liable therefor.
"Indemnified Taxes" shall mean Taxes other than Excluded Taxes.
"Information Memorandum" shall mean the Confidential Information
Memorandum dated April 2003 relating to the Borrower and the transactions
contemplated by this Agreement and the other Loan Documents.
"Interest Period" shall mean (a) with respect to any Eurodollar
Borrowing, a period of one, two, three or six months; provided, that:
(i) the initial Interest Period for such Borrowing shall
commence on the date of such Borrowing (including the date of any
conversion from a Borrowing of another Type), and each Interest Period
occurring thereafter in respect of such Borrowing shall commence on the
day on which the next preceding Interest Period expires;
(ii) if any Interest Period would otherwise end on a day
other than a Business Day, such Interest Period shall be extended to the
next succeeding Business Day, unless such Business Day falls in another
calendar month, in which case such Interest Period would end on the next
preceding Business Day;
(iii) any Interest Period which begins on the last Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of a calendar month;
(iv) each principal installment of the Term Loans shall have
an Interest Period ending on or prior to each installment payment date
and the remaining principal balance (if any) of the Term Loans shall
have an Interest Period determined as set forth above; and
(v) no Interest Period with respect to Revolving Loans may
extend beyond the Revolving Commitment Termination Date, and no Interest
Period with respect to Term Loans may extend beyond the Maturity Date.
and (b) with respect to any Swingline Loan, a period of time agreed to by the
Borrower and the Swingline Lender.
"Issuing Bank" shall mean SunTrust Bank or any other Lender that
succeeds SunTrust Bank, each in its capacity as an issuer of Letters of Credit
pursuant to Section 2.23.
12
"LC Commitment" shall mean that portion of the Aggregate
Revolving Commitment Amount that may be used by the Borrower for the issuance of
Letters of Credit, in an aggregate face amount not to exceed $15,000,000.
"LC Disbursement" shall mean a payment made by the Issuing Bank
pursuant to a Letter of Credit.
"LC Documents" shall mean the Letters of Credit and all
applications, agreements and instruments relating to the Letters of Credit.
"LC Exposure" shall mean, at any time, the sum of (i) the
aggregate undrawn amount of all outstanding Letters of Credit at such time, plus
(ii) the aggregate amount of all LC Disbursements that have not been reimbursed
by or on behalf of the Borrower at such time. The LC Exposure of any Lender
shall be its Pro Rata Share of the total LC Exposure at such time.
"Lenders" shall have the meaning set forth in the opening
paragraph of this Agreement and shall include, where appropriate, the Swingline
Lender and each additional Lender that joins this Agreement pursuant to Section
10.4.
"Letter of Credit" shall mean any stand-by letter of credit
issued pursuant to Section 2.23 by the Issuing Bank for the account of the
Borrower pursuant to the LC Commitment.
"Leverage Ratio" shall mean, as of any date, the ratio of (i)
Consolidated Total Funded Debt as of such date to (ii) Consolidated EBITDA for
the four consecutive Fiscal Quarters ending on or immediately prior to such
date, adjusted to include, on a pro forma basis, Consolidated EBITDA of any
Person acquired by the Borrower or its Subsidiaries during such period assuming
the consummation of such acquisition occurred on the first day of such period.
"LIBOR" shall mean, for any applicable Interest Period with
respect to any Eurodollar Loan, the British Bankers' Association Interest
Settlement Rate per annum for deposits in Dollars for a period equal to such
Interest Period appearing on the display designated as Page 3750 on the Dow
Jones Markets Service (or such other page on that service or such other service
designated by the British Bankers' Association for the display of such
Association's Interest Settlement Rates for Dollar deposits) as of 11:00 a.m.
(London, England time) on the day that is two Business Days prior to the first
day of the Interest Period or if such Page 3750 is unavailable for any reason at
such time, the rate which appears on the Reuters Screen ISDA Page as of such
date and such time; provided, that if the Administrative Agent determines that
the relevant foregoing sources are unavailable for the relevant Interest Period,
LIBOR shall mean the rate of interest determined by the Administrative Agent to
be the average (rounded upward, if necessary, to the nearest 1/100th of 1%) of
the rates per annum at which deposits in Dollars are offered to the
Administrative Agent two (2) Business Days preceding the first day of such
Interest Period by leading banks in the London interbank market as of 10:00 a.m.
for delivery on the first day of such Interest Period, for the number of days
comprised therein and in an amount comparable to the amount of the Eurodollar
Loan of the Administrative Agent.
"Lien" shall mean any mortgage, pledge, security interest, lien
(statutory or otherwise), charge, encumbrance, hypothecation, assignment,
deposit arrangement, or other
13
arrangement having the practical effect of the foregoing or any preference,
priority or other security agreement or similar preferential arrangement of any
kind or nature whatsoever (including any conditional sale or other title
retention agreement and any capital lease having the same economic effect as any
of the foregoing).
"Loan Documents" shall mean, collectively, this Agreement, the
Notes (if any), the LC Documents, the Subsidiary Guaranty Agreement, the
Security Documents, all Notices of Borrowing, all Notices of
Conversion/Continuation and any and all other instruments, agreements, documents
and certificates executed in connection with any of the foregoing.
"Loan Parties" shall mean the Borrower and the Subsidiary Loan
Parties.
"Loans" shall mean all Revolving Loans, Swingline Loans and Term
Loans in the aggregate or any of them, as the context shall require.
"Material Adverse Effect" shall mean, with respect to any event,
act, condition or occurrence of whatever nature (including any adverse
determination in any litigation, arbitration, or governmental investigation or
proceeding), whether singularly or in conjunction with any other event or
events, act or acts, condition or conditions, occurrence or occurrences whether
or not related, a material adverse change in, or a material adverse effect on,
(i) the business, results of operations, financial condition, assets or
liabilities of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Loan Parties to perform their respective obligations under the
Loan Documents taken as a whole, (iii) the rights and remedies of the
Administrative Agent, the Issuing Bank, Swingline Lender, and the Lenders under
any of the Loan Documents or (iv) the legality, validity or enforceability of
any of the Loan Documents. For the avoidance of doubt, the term "Material
Adverse Effect," wherever it appears in the Loan Documents, shall be construed
to apply to the Borrower and its Subsidiaries taken as a whole and not to the
Borrower or any particular Subsidiary individually.
"Maturity Date" shall mean, with respect to the Term Loans, the
earlier of (i) May 15, 2007 or (ii) the date on which the principal amount of
all outstanding Term Loans have been declared or automatically have become due
and payable (whether by acceleration or otherwise).
"Moody's" shall mean Moody's Investors Service, Inc.
"Multiemployer Plan" shall have the meaning set forth in Section
4001(a)(3) of ERISA.
"Net Mark-to-Market Exposure" of any Person shall mean, as of
any date of determination with respect to any Hedging Obligation, the excess (if
any) of all unrealized losses over all unrealized profits of such Person arising
from such Hedging Obligation. "Unrealized losses" shall mean the fair market
value of the cost to such Person of replacing the Hedging Transaction giving
rise to such Hedging Obligation as of the date of determination (assuming the
Hedging Transaction were to be terminated as of that date), and "unrealized
profits" means the fair market value of the gain to such Person of replacing
such Hedging Transaction as of the date of determination (assuming such Hedging
Transaction were to be terminated as of that date).
14
"Net Proceeds" shall mean 100% of all cash or cash equivalent
proceeds received by the Borrower or any Subsidiary (other than from the
Borrower or any Subsidiary) from (i) the issuance of any common or preferred
stock or any other debt or equity securities, or any other additions to the
equity, or contributions to the capital, of the Borrower or any Subsidiary;
provided that, in the event the Borrower or any Subsidiary makes an acquisition
permitted hereunder in which the acquisition consideration consists of an
issuance of capital stock of the Borrower or a Subsidiary and cash is acquired
as part of the assets of such acquired company, such cash shall not be included
in Net Proceeds, (ii) any sale, lease, sale and leaseback, assignment, or other
disposition of any asset or property of the Borrower or any Subsidiary (other
than the sale of inventory or equipment in the ordinary course of business), or
(iii) any insurance proceeds or condemnation awards relating to any asset or
property owned or leased by the Borrower or any Subsidiary; in each case net of
all reasonable out-of-pocket costs incurred and paid by the Borrower or such
Subsidiary in connection with such transaction (in each case paid to
non-Affiliates); provided that any capital injected into any Subsidiary by HEICO
Aerospace Holdings Corp.'s current shareholder, Lufthansa Technik AG, shall not
be included in Net Proceeds unless such capital injection has the effect of
increasing Lufthansa Technik AG's voting control of such Subsidiary to, or
occurs at any time when Lufthansa Technik AG holds voting control in such
Subsidiary of, thirty percent (30%) or more of the outstanding Capital Stock of
such Subsidiary.
"Notes" shall mean, collectively, the Syndicated Notes and the
Swingline Note.
"Notice of Conversion/Continuation" shall mean the notice given
by the Borrower to the Administrative Agent in respect of the conversion or
continuation of an outstanding Borrowing as provided in Section 2.8(b) hereof.
"Notice of Revolving Borrowing" shall have the meaning set forth
in Section 2.3.
"Notice of Swingline Loan" shall have the meaning set forth in
Section 2.5.
"Notices of Borrowing" shall mean, collectively, the Notices of
Revolving Borrowing and the Notices of Swingline Loan.
"Obligations" shall mean all amounts owing by the Borrower to
the Administrative Agent, the Issuing Bank or any Lender (including the
Swingline Lender) pursuant to or in connection with this Agreement or any other
Loan Document, including without limitation, all principal, interest (including
any interest accruing after the filing of any petition in bankruptcy or the
commencement of any insolvency, reorganization or like proceeding relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding), all reimbursement obligations, fees, expenses,
indemnification and reimbursement payments, costs and expenses (including all
reasonable fees and expenses of counsel to the Administrative Agent, the Issuing
Bank and any Lender (including the Swingline Lender) incurred pursuant to this
Agreement or any other Loan Document), whether direct or indirect, absolute or
contingent, liquidated or unliquidated, now existing or hereafter arising
hereunder or thereunder, and all Hedging Obligations owing to the Administrative
Agent, any Lender or any of their Affiliates relating to Indebtedness
outstanding under this Agreement, and all obligations and liabilities incurred
in connection with collecting
15
and enforcing the foregoing, together with all renewals, extensions,
modifications or refinancings thereof.
"Off-Balance Sheet Liabilities" of any Person shall mean (i) any
repurchase obligation or liability of such Person with respect to accounts or
notes receivable sold by such Person that do not create a liability on the
balance sheet of such Person (in accordance with GAAP), (ii) any liability of
such Person under any sale and leaseback transactions that do not create a
liability on the balance sheet of such Person, (iii) any Synthetic Lease
Obligation or (iv) any obligation arising with respect to any other transaction
which is the functional equivalent of or takes the place of borrowing but which
does not constitute a liability on the balance sheet of such Person.
"OSHA" shall mean the Occupational Safety and Health Act of
1970, as amended from time to time, and any successor statute.
"Other Taxes" shall mean any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement or any other
Loan Document.
"Participant" shall have the meaning set forth in Section
10.4(d).
"Patent Security Agreements" shall mean the Patent Security
Agreements made in favor of the Administrative Agent, on behalf of itself and
Lenders, by each applicable Loan Party.
"Payment Office" shall mean the office of the Administrative
Agent located at 303 Peachtree Street, N.E., Atlanta, Georgia 30308, or such
other location as to which the Administrative Agent shall have given written
notice to the Borrower and the other Lenders.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
referred to and defined in ERISA, and any successor entity performing similar
functions.
"Perfection Certificate" shall have the meaning assigned to such
term in the Security Agreement.
"Permitted Encumbrances" shall mean:
(i) Liens imposed by law for taxes not yet due or which are
being contested in good faith by appropriate proceedings and with
respect to which adequate reserves are being maintained in accordance
with GAAP;
(ii) statutory Liens of landlords, carriers, warehousemen,
mechanics, materialmen and similar Liens arising by operation of law in
the ordinary course of business for amounts not yet due or which are
being contested in good faith by appropriate proceedings and with
respect to which adequate reserves are being maintained in accordance
with GAAP;
16
(iii) pledges and deposits made in the ordinary course of
business in compliance with workers' compensation, unemployment
insurance and other social security laws or regulations;
(iv) deposits to secure the performance of bids, trade
contracts, leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature, in each case
in the ordinary course of business;
(v) judgment and attachment liens not giving rise to an
Event of Default or Liens created by or existing from any litigation or
legal proceeding that are currently being contested in good faith by
appropriate proceedings and with respect to which adequate reserves are
being maintained in accordance with GAAP;
(vi) bankers' Liens of a bank or financial institution
arising by operation of law with respect to funds, securities or other
assets on deposit in such bank or financial institution;
(vii) Liens in favor of customs and revenue authorities
arising as a matter of law to secure payment of customs duties in
connection with the importation of goods; and
(viii) easements, zoning restrictions, rights-of-way and
similar encumbrances on real property imposed by law or arising in the
ordinary course of business that do not secure any monetary obligations
and do not materially detract from the value of the affected property or
materially interfere with the ordinary conduct of business of the
Borrower and its Subsidiaries taken as a whole;
provided, that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.
"Permitted Investments" shall mean:
(i) direct obligations of, or obligations the principal of
and interest on which are unconditionally guaranteed by, the United
States (or by any agency thereof to the extent such obligations are
backed by the full faith and credit of the United States), in each case
maturing within one year from the date of acquisition thereof;
(ii) commercial paper having the highest rating, at the time
of acquisition thereof, of S&P or Moody's and in either case maturing
within 270 days from the date of acquisition thereof;
(iii) certificates of deposit, bankers' acceptances and time
deposits maturing within 365 days of the date of acquisition thereof
issued or guaranteed by or placed with, and money market deposit
accounts issued or offered by, any domestic office of any commercial
bank organized under the laws of the United States or any state thereof
which has a combined capital and surplus and undivided profits of not
less than $500,000,000;
17
(iv) fully collateralized repurchase agreements with a term
of not more than 30 days for securities described in clause (i) above
and entered into with a financial institution satisfying the criteria
described in clause (iii) above; and
(v) mutual funds investing solely in any one or more of the
Permitted Investments described in clauses (i) through (iv) above.
"Permitted Real Estate Debt" shall mean (i) debt incurred or
assumed by the Borrower or its Subsidiaries which was incurred for the purpose
of financing all or any part of the cost of acquisition or improvement of any
Real Estate for use in the ordinary course of business of such Person in
compliance with this Agreement and (ii) other debt incurred or assumed by the
Borrower or its Subsidiaries in an amount not in excess of $10,000,000 at any
time outstanding for the Borrower and its Subsidiaries on a consolidated basis
that is secured by Real Estate; provided that in the case of clause (ii) above
the Administrative Agent shall also have a second-priority Lien on such Real
Estate as security for the payment of the Obligations, in form and substance
satisfactory to the Administrative Agent.
"Person" shall mean any individual, partnership, firm,
corporation, association, joint venture, limited liability company, trust or
other entity, or any Governmental Authority.
"Plan" shall mean any employee pension benefit plan (other than
a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Pledge Agreement" shall mean that certain Pledge Agreement,
dated as of the date hereof, executed by the Borrower and certain of its
Subsidiaries in favor of the Administrative Agent for the benefit of the
Lenders, together with all other pledge agreements, share charges and similar
instruments executed by a Loan Party in connection herewith on the date hereof
or after the Closing Date.
"Projections" shall mean the Borrower's forecasted consolidated
and consolidating: (a) balance sheets; (b) profit and loss statements; (c) cash
flow statements; and (d) capitalization statements, all prepared on a
segment-by-segment or division-by-division basis, if applicable, and otherwise
consistent with the historical financial statements of Borrower, together with
appropriate supporting details and a statement of underlying assumptions.
"Pro Rata Share" shall mean, with respect to any Commitment of
any Lender at any time, and all Loans, other Revolving Credit Exposure, or any
payments or prepayments related thereto, a percentage, the numerator of which
shall be such Lender's Commitment (or if such Commitments have been terminated
or expired or the Loans have been declared to be due and payable, such Lender's
Revolving Credit Exposure and Term Loan, as applicable), and the denominator of
which shall be the sum of such Commitments of all Lenders (or if such
Commitments have been terminated or expired or the Loans have been declared to
be due and payable, the Revolving Credit Exposure and Term Loans of all
Lenders).
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"Real Estate" shall mean all real property owned or leased by
the Borrower and its Subsidiaries.
"Regulation D" shall mean Regulation D of the Board of Governors
of the Federal Reserve System, as the same may be in effect from time to time,
and any successor regulations.
"Related Parties" shall mean, with respect to any specified
Person, such Person's Affiliates and the respective directors, officers,
employees, agents and advisors of such Person and such Person's Affiliates.
"Release" shall mean any release, spill, emission, leaking,
dumping, injection, pouring, deposit, disposal, discharge, dispersal, leaching
or migration into the environment (including ambient air, surface water,
groundwater, land surface or subsurface strata) or within any building,
structure, facility or fixture.
"Required Lenders" shall mean, at any time, Lenders holding 66
2/3% or more of the aggregate outstanding Revolving Commitments at such time, or
if the Revolving Commitments have terminated, then Lenders holding 66 2/3% or
more of the Revolving Credit Exposure and Term Loans.
"Requirement of Law" for any Person shall mean the articles or
certificate of incorporation, bylaws, partnership certificate and agreement, or
limited liability company certificate of organization and agreement, as the case
may be, and other organizational and governing documents of such Person, and any
law, treaty, rule or regulation, or determination of a Governmental Authority,
in each case applicable to or binding upon such Person or any of its property or
to which such Person or any of its property is subject.
"Responsible Officer" shall mean any of the president, the chief
executive officer, the chief operating officer, the chief financial officer, the
treasurer or a vice president of the Borrower or such other representative of
the Borrower as may be designated in writing by any one of the foregoing with
the consent of the Administrative Agent; and, with respect to the Compliance
Certificate only, the chief financial officer of the Borrower.
"Revolving Commitment" shall mean, with respect to each Lender,
the obligation of such Lender to make Revolving Loans to the Borrower and to
participate in Letters of Credit and Swingline Loans in an aggregate principal
amount not exceeding the amount set forth with respect to such Lender on Annex
I, as such annex may be amended pursuant to Section 2.5, or in the case of a
Person becoming a Lender after the Closing Date through an assignment of an
existing Revolving Commitment, the amount of the assigned "Revolving Commitment"
as provided in the Assignment and Acceptance executed by such Person as an
assignee, as the same may be increased or deceased pursuant to terms hereof.
"Revolving Commitment Termination Date" shall mean the earliest
of (i) May 15, 2006, as extended pursuant to Section 2.24 (ii) the date on which
the Revolving Commitments are terminated pursuant to Section 2.9 and (iii) the
date on which all amounts
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outstanding under this Agreement have been declared or have automatically become
due and payable (whether by acceleration or otherwise).
"Revolving Credit Exposure" shall mean, with respect to any
Lender at any time, the sum of the outstanding principal amount of such Lender's
Revolving Loans, LC Exposure and Swingline Exposure.
"Revolving Loan" shall mean a loan made by a Lender (other than
the Swingline Lender) to the Borrower under its Revolving Commitment, which may
either be a Base Rate Loan or a Eurodollar Loan.
"Security Agreement" shall mean that certain Security Agreement,
dated as of the date hereof, executed by the Borrower and each Domestic
Subsidiary that is a Subsidiary Loan Party in favor of the Administrative Agent
for the benefit of the Lenders, and each other security agreement executed from
time to time in connection herewith.
"Security Documents" shall mean, collectively, the Security
Agreement, the Pledge Agreements, any Control Agreements, any Blocked Account
Agreements, any Patent Security Agreements, any Trademark Security Agreements,
the Perfection Certificate, and all other instruments and agreements now or
hereafter securing the whole or any part of the Obligations or any Guarantee
thereof, all UCC financing statements, fixture financing statements, stock
powers, and all other documents, instruments, agreements and certificates
executed and delivered by any Loan Party to the Administrative Agent and the
Lenders in connection with the foregoing.
"S&P" shall mean Standard & Poor's, a Division of the
McGraw-Hill Companies.
"Solvent" means, with respect to any Person, that as of the date
of determination, both (a)(i) the then fair saleable value of the property of
such Person is (y) greater than the total amount of liabilities (including
contingent obligations to the extent required to be reflected as liabilities in
the financial statements of such Person pursuant to GAAP) of such Person and (z)
greater than the amount that will be required to pay the probable liabilities of
such Person's then existing debts as they become absolute and matured
considering all financing alternatives and potential asset sales reasonably
available to such Person; (ii) such Person's capital is not unreasonably small
in relation to its business or any contemplated or undertaken transaction; and
(iii) such Person does not intend to incur, or believe or reasonably should
believe that it will incur, debts beyond its ability to pay such debts as they
become due and (b) such Person is solvent within the meaning given that term and
similar terms under applicable laws relating to fraudulent transfers.
"Subsidiary" shall mean, with respect to any Person (the
"parent"), any corporation, partnership, joint venture, limited liability
company, association or other entity the accounts of which would be consolidated
with those of the parent in the parent's consolidated financial statements if
such financial statements were prepared in accordance with GAAP as of such date,
as well as any other corporation, partnership, joint venture, limited liability
company, association or other entity (i) of which securities or other ownership
interests representing more than 50% of the equity or more than 50% of the
ordinary voting power, or in the case of a
20
partnership, more than 50% of the general partnership interests are, as of such
date, owned, controlled or held, or (ii) that is, as of such date, otherwise
controlled (whether pursuant to (i) above, by contractual agreement, or any
combination thereof) by the parent or one or more subsidiaries of the parent or
by the parent and one or more subsidiaries of the parent. Unless otherwise
indicated, all references to "Subsidiary" hereunder shall mean a Subsidiary of
the Borrower. For purposes of this definition, "control", with respect to any
Person, shall mean the power, directly or indirectly, to select a majority of
the directors (or other Persons performing similar functions) of such Person.
"Subsidiary Guaranty Agreement" shall mean the Subsidiary
Guaranty Agreement, dated as of the date hereof and substantially in the form of
Exhibit D, made by the Subsidiary Loan Parties in favor of the Administrative
Agent for the benefit of the Lenders.
"Subsidiary Guaranty Supplement" shall mean each supplement
substantially in the form of Annex I to the Subsidiary Guaranty Agreement
executed and delivered by a Subsidiary of the Borrower pursuant to Section 5.17.
"Subsidiary Loan Party" shall mean any Subsidiary of the
Borrower that guarantees the Obligations. For the avoidance of doubt,
"Subsidiary Loan Party" shall exclude HT Parts, L.L.C. and Parts Advantage, LLC
and HEICO International Corporation.
"Swingline Commitment" shall mean the commitment of the
Swingline Lender to make Swingline Loans in an aggregate principal amount at any
time outstanding not to exceed $10,000,000.
"Swingline Exposure" shall mean, with respect to each Lender,
the principal amount of the Swingline Loans in which such Lender is legally
obligated either to make a Base Rate Loan or to purchase a participation in
accordance with Section 2.5, which shall equal such Lender's Pro Rata Share of
all outstanding Swingline Loans.
"Swingline Lender" shall mean SunTrust Bank.
"Swingline Loan" shall mean a loan made to the Borrower by the
Swingline Lender under the Swingline Commitment.
"Swingline Note" shall mean the promissory note of the Borrower
payable to the order of the Swingline Lender in the principal amount of the
Swingline Commitment, substantially the form of Exhibit B.
"Swingline Rate" shall mean, for any Interest Period agreed to
by the Swingline Lender and the Borrower, the rate offered by the Swingline
Lender and accepted by the Borrower. The Borrower is under no obligation to
accept such rate and the Swingline Lender is under no obligation to provide it.
"Syndicated Note" shall mean a promissory note of the Borrower
payable to the order of a requesting Lender in the principal amount of such
Lender's Revolving Commitment, in substantially the form of Exhibit A,
evidencing such Lender's Revolving Commitment and its
21
Revolving Credit Exposure thereunder, and at any time after the Revolving Loans
have been converted to Term Loans pursuant to Section 2.6, evidencing such
Lender's Term Loan.
"Synthetic Lease" shall mean a lease transaction under which the
parties intend that (i) the lease will be treated as an "operating lease" by the
lessee pursuant to Statement of Financial Accounting Standards No. 13, as
amended and (ii) the lessee will be entitled to various tax and other benefits
ordinarily available to owners (as opposed to lessees) of like property.
"Synthetic Lease Obligations" shall mean, with respect to any
Person, the sum of (i) all remaining rental obligations of such Person as lessee
under Synthetic Leases which are attributable to principal and, without
duplication, (ii) all rental and purchase price payment obligations of such
Person under such Synthetic Leases assuming such Person exercises the option to
purchase the lease property at the end of the lease term.
"Taxes" shall mean any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Term Loan" shall mean, for any Lender, the term loan made by
such Lender to the Borrower pursuant to Section 2.6, equal to its Revolving
Loans and Swingline Exposure outstanding on the Revolving Commitment Termination
Date.
"Trademark Security Agreements" shall mean the Trademark
Security Agreements made in favor of the Administrative Agent, on behalf of
itself and Lenders, by each applicable Loan Party.
"Type", when used in reference to a Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the Base
Rate.
"Uniform Commercial Code" or "UCC" shall mean the Uniform
Commercial Code as in effect from time to time in the State of Florida.
"Withdrawal Liability" shall mean liability to a Multiemployer
Plan as a result of a complete or partial withdrawal from such Multiemployer
Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
Section 1.2. Classifications of Loans and Borrowings. For
purposes of this Agreement, Loans may be classified and referred to by Class
(e.g. a "Revolving Loan" or "Term Loan") or by Type (e.g. a "Eurodollar Loan" or
"Base Rate Loan") or by Class and Type (e.g. "Revolving Eurodollar Loan").
Borrowings also may be classified and referred to by Class (e.g. "Revolving
Borrowing") or by Type (e.g. "Eurodollar Borrowing") or by Class and Type (e.g.
" Revolving Eurodollar Borrowing").
Section 1.3. Accounting Terms and Determination. Unless
otherwise defined or specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared, in
accordance with GAAP as in effect from time to time, applied on a basis
consistent with the most recent audited consolidated financial statement of the
Borrower
22
delivered pursuant to Section 5.1(a); provided, that if the Borrower notifies
the Administrative Agent that the Borrower wishes to amend any provision hereof
to eliminate the effect of any change in GAAP on the operation of such provision
(or if the Administrative Agent notifies the Borrower that the Required Lenders
wish to amend any provision hereof for such purpose), then such provision shall
be interpreted on the basis of GAAP in effect immediately before the relevant
change in GAAP became effective, until either such notice is withdrawn or such
provision is amended in a manner satisfactory to the Borrower and the Required
Lenders.
Section 1.4. Terms Generally. The definitions of terms
herein shall apply equally to the singular and plural forms of the terms
defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words "include",
"includes" and "including" shall be deemed to be followed by the phrase "without
limitation". The word "will" shall be construed to have the same meaning and
effect as the word "shall". In the computation of periods of time from a
specified date to a later specified date, the word "from" means "from and
including" and the word "to" means "to but excluding". Unless the context
requires otherwise (i) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as it was originally executed or as it
may from time to time be amended, restated, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (ii) any reference herein to any Person shall be construed to
include such Person's successors and permitted assigns, (iii) the words
"hereof", "herein" and "hereunder" and words of similar import shall be
construed to refer to this Agreement as a whole and not to any particular
provision hereof, (iv) all references to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles, Sections, Exhibits and
Schedules to this Agreement, (v) all references to a specific time shall be
construed to refer to the time in the city and state of the Administrative
Agent's principal office, unless otherwise indicated and (vi) the words
"material," "in any material respect," "materially" and words of similar import,
wherever they may appear in the Loan Documents, shall be construed to qualify
the obligations or representations and warranties, as applicable, of the
Borrower and its Subsidiaries taken as a whole and not of the Borrower or any
particular Subsidiary, individually. All certifications of officers of the
Borrower and its Subsidiaries shall be deemed to be in their corporate (and not
individual) capacities.
ARTICLE II
AMOUNT AND TERMS OF THE COMMITMENTS
Section 2.1. General Description of Facilities. Subject to
and upon the terms and conditions herein set forth, (i) the Lenders hereby
establish in favor of the Borrower a revolving credit facility pursuant to which
each Lender severally agrees (to the extent of such Lender's Revolving
Commitment) to make Revolving Loans to the Borrower in accordance with Section
2.2, (ii) the Issuing Bank agrees to issue Letters of Credit in accordance with
Section 2.23, (iii) the Swingline Lender agrees to make Swingline Loans in
accordance with Section 2.4, (iv) each Lender agrees to purchase a participation
interest in the Letters of Credit and the Swingline Loans pursuant to the terms
and conditions hereof; provided, that in no event shall the aggregate principal
amount of all outstanding Revolving Credit Exposure exceed at any time the
Aggregate
23
Revolving Commitment Amount from time to time in effect; and (v) each Lender
severally agrees to permit the Borrower to convert its outstanding Revolving
Loans with such Lender into Term Loans in a principal amount not exceeding such
Lender's Revolving Commitment at the time of conversion, subject to the terms
and conditions contained in Section 2.6 hereof.
Section 2.2. Revolving Loans. Subject to the terms and
conditions set forth herein, each Lender severally agrees to make Revolving
Loans, ratably in proportion to its Pro Rata Share, to the Borrower, from time
to time during the Availability Period, in an aggregate principal amount
outstanding at any time that will not result in (a) such Lender's Revolving
Credit Exposure exceeding such Lender's Revolving Commitment, or (b) the sum of
the aggregate Revolving Credit Exposures of all Lenders exceeding the Aggregate
Revolving Commitment Amount. During the Availability Period, the Borrower shall
be entitled to borrow, prepay and reborrow Revolving Loans in accordance with
the terms and conditions of this Agreement; provided, that the Borrower may not
borrow or reborrow should there exist a Default or Event of Default.
Section 2.3. Procedure for Revolving Borrowings. The
Borrower shall give the Administrative Agent written notice (or telephonic
notice promptly confirmed in writing) of each Revolving Borrowing substantially
in the form of Exhibit 2.3 attached hereto (a "Notice of Revolving Borrowing")
(x) prior to 12:00 noon at least one (1) Business Day prior to the requested
date of each Base Rate Borrowing and (y) prior to 12:00 noon at least three (3)
Business Days prior to the requested date of each Eurodollar Borrowing. Each
Notice of Revolving Borrowing shall be irrevocable and shall specify: (i) the
aggregate principal amount of such Borrowing, (ii) the date of such Borrowing
(which shall be a Business Day), (iii) the Type of such Revolving Loan
comprising such Borrowing and (iv) in the case of a Eurodollar Borrowing, the
duration of the initial Interest Period applicable thereto (subject to the
provisions of the definition of Interest Period). Each Revolving Borrowing shall
consist entirely of Base Rate Loans or Eurodollar Loans, as the Borrower may
request. The aggregate principal amount of each Eurodollar Borrowing shall be
not less than $5,000,000 or a larger multiple of $1,000,000, and the aggregate
principal amount of each Base Rate Borrowing shall not be less than $1,000,000
or a larger multiple of $100,000; provided, that Base Rate Loans made pursuant
to Section 2.5(b) or Section 2.23(d) may be made in lesser amounts as provided
therein. At no time shall the total number of Eurodollar Borrowings outstanding
at any time exceed six. Promptly following the receipt of a Notice of Revolving
Borrowing in accordance herewith, the Administrative Agent shall advise each
Lender of the details thereof and the amount of such Lender's Revolving Loan to
be made as part of the requested Revolving Borrowing.
Section 2.4. Swingline Commitment. Subject to the terms
and conditions set forth herein, the Swingline Lender agrees to make Swingline
Loans to the Borrower, from time to time during the Availability Period, in an
aggregate principal amount outstanding at any time not to exceed the lesser of
(i) the Swingline Commitment then in effect and (ii) the difference between the
Aggregate Revolving Commitment Amount and the aggregate Revolving Credit
Exposures of all Lenders; provided, that the Swingline Lender shall not be
required to make a Swingline Loan to refinance an outstanding Swingline Loan.
The Borrower shall be entitled to borrow, repay and reborrow Swingline Loans in
accordance with the terms and conditions of this Agreement.
24
Section 2.5. Procedure for Swingline Loan; Etc. (a) The
Borrower shall give the Administrative Agent written notice (or telephonic
notice promptly confirmed in writing) of each Swingline Loan substantially in
the form of Exhibit 2.5 attached hereto ("Notice of Swingline Loan") prior to
10:00 a.m. on the requested date of each Swingline Loan. Each Notice of
Swingline Loan shall be irrevocable and shall specify: (i) the principal amount
of such Swingline Loan, (ii) the date of such Swingline Loan (which shall be a
Business Day) and (iii) the account of the Borrower to which the proceeds of
such Swingline Loan should be credited. The Administrative Agent will promptly
advise the Swingline Lender of each Notice of Swingline Loan. Each Swingline
Loan shall accrue interest at the Swingline Rate or any other interest rate as
agreed between the Borrower and the Swingline Lender and shall have an Interest
Period (subject to the definition thereof) as agreed between the Borrower and
the Swingline Lender. The aggregate principal amount of each Swingline Loan
shall be not less than $100,000 or a larger multiple of $50,000, or such other
minimum amounts agreed to by the Swingline Lender and the Borrower. The
Swingline Lender will make the proceeds of each Swingline Loan available to the
Borrower in Dollars in immediately available funds at the account specified by
the Borrower in the applicable Notice of Swingline Loan not later than 1:00 p.m.
on the requested date of such Swingline Loan.
(b) The Swingline Lender, at any time and from time to time
in its sole discretion, may, on behalf of the Borrower (which hereby irrevocably
authorizes and directs the Swingline Lender to act on its behalf), give a Notice
of Revolving Borrowing to the Administrative Agent requesting the Lenders
(including the Swingline Lender) to make Base Rate Loans in an amount equal to
the unpaid principal amount of any Swingline Loan. Each Lender will make the
proceeds of its Base Rate Loan included in such Borrowing available to the
Administrative Agent for the account of the Swingline Lender in accordance with
Section 2.7, which will be used solely for the repayment of such Swingline Loan.
(c) If for any reason a Base Rate Borrowing may not be (as
determined in the sole discretion of the Administrative Agent), or is not, made
in accordance with the foregoing provisions, then each Lender (other than the
Swingline Lender) shall purchase an undivided participating interest in such
Swingline Loan in an amount equal to its Pro Rata Share thereof on the date that
such Base Rate Borrowing should have occurred. On the date of such required
purchase, each Lender shall promptly transfer, in immediately available funds,
the amount of its participating interest to the Administrative Agent for the
account of the Swingline Lender. If such Swingline Loan bears interest at a rate
other than the Base Rate, such Swingline Loan shall automatically become a Base
Rate Loan on the effective date of any such participation and interest shall
become payable on demand.
(d) Each Lender's obligation to make a Base Rate Loan
pursuant to Section 2.5(b) or to purchase the participating interests pursuant
to Section 2.5(c) shall be absolute and unconditional and shall not be affected
by any circumstance, including without limitation (i) any setoff, counterclaim,
recoupment, defense or other right that such Lender or any other Person may have
or claim against the Swingline Lender, the Borrower or any other Person for any
reason whatsoever, (ii) the existence of a Default or an Event of Default or the
termination of any Lender's Revolving Commitment, (iii) the existence (or
alleged existence) of any event or condition which has had or could reasonably
be expected to have a Material Adverse Effect, (iv) any breach of this Agreement
or any other Loan Document by the Borrower, the Administrative
25
Agent or any Lender or (v) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing. If such amount is
not in fact made available to the Swingline Lender by any Lender, the Swingline
Lender shall be entitled to recover such amount on demand from such Lender,
together with accrued interest thereon for each day from the date of demand
thereof (i) at the Federal Funds Rate until the second Business Day after such
demand and (ii) at the Base Rate at all times thereafter. Until such time as
such Lender makes its required payment, the Swingline Lender shall be deemed to
continue to have outstanding Swingline Loans in the amount of the unpaid
participation for all purposes of the Loan Documents. In addition, such Lender
shall be deemed to have assigned any and all payments made of principal and
interest on its Loans and any other amounts due to it hereunder, to the
Swingline Lender to fund the amount of such Lender's participation interest in
such Swingline Loans that such Lender failed to fund pursuant to this Section,
until such amount has been purchased in full.
Section 2.6. Conversion of Revolving Loans to Term Loans.
(a) At least 60 but not more than 90 days prior to the
Revolving Commitment Termination Date, the Borrower, by delivering a written
request to the Administrative Agent (a "Term Loan Conversion Request"), may
request that on the Revolving Commitment Termination Date, all or a portion of
the outstanding Revolving Loans and Swingline Loans be converted into Term
Loans, to be funded by the Lenders pro rata based on their Pro Rata Shares of
the Revolving Credit Exposure on the Revolving Credit Termination Date (the
"Term Loan Conversion Option"); provided, however, that the Term Loan Conversion
Option will not be available to the Borrower if (i) any Default or Event of
Default shall have occurred and be continuing, or (ii) the Revolving Commitment
Termination Date for any portion of the Revolving Commitments shall have been
extended pursuant to Section 2.24, or otherwise. The Term Loan Conversion
Request shall include the dollar amount of all outstanding Revolving Loans and
Swingline Loans that the Borrower is requesting to be converted. Any outstanding
Obligations that are not converted to Term Loans pursuant to this Section shall
be due and payable in full on the Revolving Commitment Termination Date. Upon
receipt of such Term Loan Conversion Request, the Administrative Agent shall
promptly deliver copies thereof to the Lenders.
(b) If the Term Loan Conversion Option is available to the
Borrower, then promptly upon receipt of the Term Loan Conversion Request, and no
later than 45 days prior to the Revolving Commitment Termination Date, the
Lenders shall indicate to the Administrative Agent the Applicable Margins at
which the Term Loans will bear interest over LIBOR and Base Rate after the
Revolving Commitment Termination Date, and the Administrative Agent shall
promptly notify the Borrower thereof (the "Applicable Margin Notice"). If the
Borrower accepts the proposed Applicable Margins in the Applicable Margin
Notice, it shall promptly notify the Administrative Agent and the Lenders, and
subject to the conditions set forth in clause (c) below, all outstanding
Swingline Loans and Revolving Loans shall automatically convert to Term Loans on
the Revolving Commitment Termination Date, to be funded pro rata by all Lenders
based on their Pro Rata Share of the Revolving Credit Exposure immediately prior
thereto. If the Borrower notifies the Administrative Agent that it does not
accept the proposed Applicable Margins in the Applicable Margin Notice, or the
Administrative Agent receives no response from the Borrower no later than 30
days prior to the Revolving Commitment Termination Date, or the conditions to
conversation set forth in clause (c) below are not met on
26
the Revolving Commitment Termination Date, then the Borrower shall be deemed to
have terminated its request to convert the Revolving Loans and Swingline Loans
to Term Loans, and all outstanding Obligations shall be due and payable in full
on the Revolving Commitment Termination Date, as if the Term Loan Conversion
Request had not been delivered.
(c) Notwithstanding anything set forth above, the Revolving
Loans and Swingline Loans will NOT convert into Term Loans on the Revolving
Commitment Termination Date unless (i) no Default or Event of Default shall have
occurred and be continuing, (ii) the Revolving Commitment Termination Date for
any portion of the Revolving Commitments shall not have been extended pursuant
to Section 2.24 or otherwise, (iii) all conditions to borrowing set forth in
Section 3.2 are satisfied on the Revolving Commitment Termination Date, (iv) all
Letters of Credit have expired or been cash collateralized in accordance with
the terms of this Agreement and (v) the Borrower delivers a certificate to the
Administrative Agent dated as of the Revolving Commitment Termination Date
executed by a Responsible Officer and certifying that the conditions set forth
in this clause (c) have been met.
(d) If the conditions set forth in clause (c) above are
satisfied and the Revolving Loans and all Swingline Loans are converted into
Term Loans, on the Revolving Commitment Termination Date, the Lenders shall
reallocate their outstanding Loans such that the Term Loans are shared pro rata
based upon their respective Pro Rata Shares, and the Applicable Margins shall be
adjusted in accordance with the terms of the Applicable Margin Notice. The Term
Loans shall be evidenced by the Syndicated Notes.
(e) The Borrower unconditionally promises to pay to the
Administrative Agent for the account of each Lender the then unpaid principal
amount of the Term Loan of such Lender in equal quarterly installments on July
31, 2006, October 31, 2006, January 31, 2006 and May 15, 2007, with each such
installment equal to 25% of the Term Loans outstanding on the Revolving
Commitment Termination Date immediately after the Term Loan Conversion Option
was exercised; provided, that, to the extent not previously paid, the aggregate
unpaid principal balance of the Term Loans and all other Obligations shall be
due and payable on the Maturity Date.
Section 2.7. Funding of Borrowings.
(a) Each Lender will make available each Loan to be made by
it hereunder on the proposed date thereof by wire transfer in immediately
available funds by 11:00 a.m. to the Administrative Agent at the Payment Office;
provided, that the Swingline Loans will be made as set forth in Section 2.5. The
Administrative Agent will make such Loans available to the Borrower by promptly
crediting the amounts that it receives, in like funds by the close of business
on such proposed date, to an account maintained by the Borrower with the
Administrative Agent or at the Borrower's option, by effecting a wire transfer
of such amounts to an account designated by the Borrower to the Administrative
Agent.
(b) Unless the Administrative Agent shall have been notified
by any Lender prior to 5:00 p.m. one (1) Business Day prior to the date of a
Borrowing in which such Lender is to participate that such Lender will not make
available to the Administrative Agent such Lender's share of such Borrowing, the
Administrative Agent may assume that such Lender has
27
made such amount available to the Administrative Agent on such date, and the
Administrative Agent, in reliance on such assumption, may make available to the
Borrower on such date a corresponding amount. If such corresponding amount is
not in fact made available to the Administrative Agent by such Lender on the
date of such Borrowing, the Administrative Agent shall be entitled to recover
such corresponding amount on demand from such Lender together with interest at
the Federal Funds Rate until the second Business Day after such demand and
thereafter at the Base Rate. If such Lender does not pay such corresponding
amount forthwith upon the Administrative Agent's demand therefor, the
Administrative Agent shall promptly notify the Borrower, and the Borrower shall
immediately pay such corresponding amount to the Administrative Agent together
with interest at the rate specified for such Borrowing. Nothing in this
subsection shall be deemed to relieve any Lender from its obligation to fund its
Pro Rata Share of any Borrowing hereunder or to prejudice any rights which the
Borrower may have against any Lender as a result of any default by such Lender
hereunder.
(c) All Revolving Borrowings shall be made by the Lenders on
the basis of their respective Pro Rata Shares. No Lender shall be responsible
for any default by any other Lender in its obligations hereunder, and each
Lender shall be obligated to make its Loans provided to be made by it hereunder,
regardless of the failure of any other Lender to make its Loans hereunder.
(d) The Borrower will use the proceeds of all Loans made on
the Closing Date to refinance the outstanding obligations under the Existing
Credit Agreement and to pay transaction costs related thereto, and the Borrower
will use the proceeds of all Loans made after the Closing Date to fund future
acquisitions permitted hereunder, to provide working capital and for other
general corporate purposes of the Borrower and its Subsidiaries.
Section 2.8. Interest Elections.
(a) Each Borrowing initially shall be of the Type specified
in the applicable Notice of Borrowing, and in the case of a Eurodollar
Borrowing, shall have an initial Interest Period as specified in such Notice of
Borrowing. Thereafter, the Borrower may elect to convert such Borrowing into a
different Type or to continue such Borrowing, and in the case of a Eurodollar
Borrowing, may elect Interest Periods therefor, all as provided in this Section.
The Borrower may elect different options with respect to different portions of
the affected Borrowing, in which case each such portion shall be allocated
ratably among the Lenders holding Loans comprising such Borrowing, and the Loans
comprising each such portion shall be considered a separate Borrowing. This
Section shall not apply to Swingline Loans, which may not be converted or
continued.
(b) To make an election pursuant to this Section, the
Borrower shall give the Administrative Agent prior written notice (or telephonic
notice promptly confirmed in writing) of each Borrowing substantially in the
form of Exhibit 2.8 attached hereto (a "Notice of Conversion/Continuation") that
is to be converted or continued, as the case may be, (x) prior to 12:00 p.m. at
least one (1) Business Day prior to the requested date of a conversion into a
Base Rate Borrowing and (y) prior to 12:00 p.m. at least three (3) Business Days
prior to a continuation of or conversion into a Eurodollar Borrowing. Each such
Notice of Conversion/Continuation shall be irrevocable and shall specify (i) the
Borrowing to which such
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Notice of Continuation/Conversion applies and if different options are being
elected with respect to different portions thereof, the portions thereof that
are to be allocated to each resulting Borrowing (in which case the information
to be specified pursuant to clauses (iii) and (iv) shall be specified for each
resulting Borrowing); (ii) the effective date of the election made pursuant to
such Notice of Continuation/Conversion, which shall be a Business Day, (iii)
whether the resulting Borrowing is to be a Base Rate Borrowing or a Eurodollar
Borrowing; and (iv) if the resulting Borrowing is to be a Eurodollar Borrowing,
the Interest Period applicable thereto after giving effect to such election,
which shall be a period contemplated by the definition of "Interest Period". If
any such Notice of Continuation/Conversion requests a Eurodollar Borrowing but
does not specify an Interest Period, the Borrower shall be deemed to have
selected an Interest Period of one month. The principal amount of any resulting
Borrowing shall satisfy the minimum borrowing amount for Eurodollar Borrowings
and Base Rate Borrowings set forth in Section 2.3.
(c) If, on the expiration of any Interest Period in respect
of any Eurodollar Borrowing, the Borrower shall have failed to deliver a Notice
of Conversion/ Continuation, then, unless such Borrowing is repaid as provided
herein, the Borrower shall be deemed to have elected to convert such Borrowing
to a Base Rate Borrowing. No Borrowing may be converted into, or continued as, a
Eurodollar Borrowing if a Default or an Event of Default exists, unless the
Administrative Agent and each of the Lenders shall have otherwise consented in
writing. No conversion of any Eurodollar Loans shall be permitted except on the
last day of the Interest Period in respect thereof.
(d) Upon receipt of any Notice of Conversion/Continuation,
the Administrative Agent shall promptly notify each Lender of the details
thereof and of such Lender's portion of each resulting Borrowing.
Section 2.9. Optional Reduction and Termination of
Commitments.
(a) Unless previously terminated in accordance with the
terms hereof, all Revolving Commitments (including the LC Commitments and the
Swingline Commitment) shall terminate on the Revolving Commitment Termination
Date.
(b) Upon at least three (3) Business Days' prior written
notice (or telephonic notice promptly confirmed in writing) to the
Administrative Agent (which notice shall be irrevocable), the Borrower may
reduce the Aggregate Revolving Commitments in part or terminate the Aggregate
Revolving Commitments in whole; provided, that (i) any partial reduction shall
apply to reduce proportionately and permanently the Revolving Commitment of each
Lender, (ii) any partial reduction pursuant to this Section 2.9 shall be in an
amount of at least $1,000,000 and any larger multiple of $1,000,000, and (iii)
no such reduction shall be permitted which would reduce the Aggregate Revolving
Commitment Amount to an amount less than the outstanding Revolving Credit
Exposures of all Lenders. Any such reduction in the Aggregate Revolving
Commitment Amount below the aggregate principal amount of the Swingline
Commitment and the LC Commitment shall result in a reduction (rounded to the
next lowest integral multiple of $100,000) in the Swingline Commitment and the
LC Commitment, proportionate to the unused portion of each such Commitment.
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Section 2.10. Repayment of Loans.
(a) The outstanding principal amount of all Revolving Loans
shall be due and payable (together with accrued and unpaid interest thereon and
Fees related thereto) on the Revolving Commitment Termination Date.
(b) The principal amount of each Swingline Loan shall be due
and payable (together with accrued and unpaid interest thereon) on the earlier
of (i) the last day of the Interest Period applicable to such Swingline Loan and
(ii) the Revolving Commitment Termination Date.
(c) If the Lenders make any Term Loans in accordance with
Section 2.6, the Borrower unconditionally promises to pay to the Administrative
Agent for the account of each Lender the then unpaid principal amount of the
Term Loan of such Lender in installments payable in accordance with Section 2.6;
provided, that, to the extent not previously paid, the aggregate unpaid
principal balance of the Term Loans (together with accrued and unpaid interest
thereon) shall be due and payable on the Maturity Date.
Section 2.11. Evidence of Indebtedness. (a) Each Lender
shall maintain in accordance with its usual practice appropriate records
evidencing the indebtedness of the Borrower to such Lender resulting from each
Loan made by such Lender from time to time, including the amounts of principal
and interest payable thereon and paid to such Lender from time to time under
this Agreement. The Administrative Agent shall maintain appropriate records in
which shall be recorded (i) the Revolving Commitment of each Lender, (ii) the
amount of each Loan made hereunder by each Lender, the Class and Type thereof
and the Interest Period applicable thereto, (iii) the date of each continuation
thereof pursuant to Section 2.8, (iv) the date of each conversion of all or a
portion thereof to another Type pursuant to Section 2.8, (v) the date and amount
of any principal or interest due and payable or to become due and payable from
the Borrower to each Lender hereunder in respect of such Loans and (vi) both the
date and amount of any sum received by the Administrative Agent hereunder from
the Borrower in respect of the Loans and each Lender's Pro Rata Share thereof.
Absent manifest error, the entries made in such records shall be prima facie
evidence of the existence and amounts of the obligations of the Borrower therein
recorded; provided, that the failure or delay of any Lender or the
Administrative Agent in maintaining or making entries into any such record or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Loans (both principal and unpaid accrued interest) of such Lender
in accordance with the terms of this Agreement.
(b) At the request of any Lender (including the Swingline
Lender) at any time, the Borrower agrees that it will execute and deliver to
such Lender a Syndicated Note and, in the case of the Swingline Lender only, a
Swingline Note, payable to the order of such Lender.
Section 2.12. Optional Prepayments. The Borrower shall have
the right at any time and from time to time to prepay any Borrowing, in whole or
in part, without premium or penalty, by giving irrevocable written notice (or
telephonic notice promptly confirmed in writing) to the Administrative Agent no
later than (i) in the case of prepayment of any Eurodollar Borrowing, 11:00 a.m.
not less than three (3) Business Days prior to any such prepayment, (ii) in the
case of any prepayment of any Base Rate Borrowing, 11:00 a.m. not less than one
Business Day prior to the date of such prepayment, and (iii) in the case of
Swingline Loans, prior to 11:00 a. m.
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on the date of such prepayment. Each such notice shall be irrevocable and shall
specify the proposed date of such prepayment and the principal amount of each
Borrowing or portion thereof to be prepaid. Upon receipt of any such notice, the
Administrative Agent shall promptly notify each affected Lender of the contents
thereof and of such Lender's Pro Rata Share of any such prepayment. If such
notice is given, the aggregate amount specified in such notice shall be due and
payable on the date designated in such notice, together with accrued interest to
such date on the amount so prepaid in accordance with Section 2.14(d); provided,
that if a Eurodollar Borrowing is prepaid on a date other than the last day of
an Interest Period applicable thereto, the Borrower shall also pay all amounts
required pursuant to Section 2.20. Each partial prepayment of any Loan (other
than a Swingline Loan) shall be in an amount that would be permitted in the case
of an advance of a Revolving Borrowing of the same Type pursuant to Section 2.2
or in the case of a Swingline Loan pursuant to Section 2.4. Each prepayment of a
Borrowing shall be applied ratably to the Loans comprising such Borrowing, and
in the case of a prepayment of a Term Loan Borrowing, to principal installments
in inverse order of maturity.
Section 2.13. Mandatory Prepayments.
(a) If at any time the aggregate outstanding principal
amount of Revolving Loans exceeds the Aggregate Revolving Commitments the
Borrower shall immediately repay the Swingline Loans and the Revolving Loans in
an amount equal to such excess, together with all accrued and unpaid interest on
such excess amount and any amounts due under Section 2.20. Each prepayment of a
Borrowing shall be applied ratably to the Swingline Loans, to the full extent
thereof, then to the Revolving Base Rate Loans to the full extent thereof, and
then to Revolving Eurodollar Loans to the full extent thereof.
(b) Immediately upon receipt by the Borrower or any of its
Subsidiaries of proceeds of any sale or disposition by the Borrower or such
Subsidiary of any of its assets (excluding sales of inventory in the ordinary
course of business), or the receipt of any condemnation awards or insurance
proceeds relating to any asset or property owned or leased by the Borrower or
any of its Subsidiaries (except to the extent that (i) the proceeds of such
insurance or condemnation award are used to repair or replace the asset or
property to which they relate and for which they were received and (ii) the
Borrower and its Subsidiaries, as the case may be, make diligent efforts to
complete such repair or replacement in a commercially reasonable timeframe
(provided that a Default or Event of Default shall not have occurred and be
continuing), and except as otherwise required by the Bond Documents), the
Borrower shall prepay the Loans in an amount equal to the Net Proceeds of all
such awards and proceeds.
(c) If the Borrower or any of its Subsidiaries incurs any
Indebtedness or issues any equity securities (other than Indebtedness permitted
under Section 7.1, and equity securities issued by a Subsidiary of the Borrower
to the Borrower or another Subsidiary), then no later than the Business Day
following the date of receipt of the Net Proceeds thereof, the Borrower shall
prepay the Loans in an amount equal to all such Net Proceeds.
(d) Any prepayments made by the Borrower pursuant to
Sections 2.13(b) or (c) above shall be applied as follows: first, to
Administrative Agent's fees and reimbursable expenses then due and payable
pursuant to any of the Loan Documents; second, to all other Fees and
reimbursable expenses of the Lenders and the Issuing Bank then due and payable
pursuant to
31
any of the Loan Documents, pro rata to the Lenders and the Issuing Bank based on
their respective pro rata shares of such Fees and expenses; third, to interest
then due and payable on the Loans made to the Borrower, pro rata to the Lenders
based on their respective Pro Rata Shares of such Loans; fourth, to the
principal balance of the Term Loans, pro rata to the Lenders based on their
respective Pro Rata Shares of the Term Loans; fifth to the principal balance of
the Swingline Loans, to the Swingline Lender; sixth, to the principal balance of
the Revolving Loans, pro rata to the Lenders based on their respective Pro Rata
Shares of the Revolving Loans; and seventh to the outstanding amount of any LC
Exposure to provide cash collateral therefor in the manner set forth in Section
2.23(g), until all such LC Exposure has been fully cash collateralized in the
manner set forth in Section 2.23(g). The Revolving Commitments of the Lenders
shall not be permanently reduced by the amount of any prepayments made pursuant
to clauses fifth, sixth and seventh above unless a Default or Event of Default
has occurred and is continuing. The prepayment requirements set forth in
Sections 2.13(b) and (c) shall be subject to a cumulative exception, at the
option of the Borrower, in an aggregate amount not to exceed $1,000,000 during
any twelve month period.
Section 2.14. Interest on Loans.
(a) The Borrower shall pay interest on each Base Rate Loan
at the Base Rate in effect from time to time and on each Eurodollar Loan at the
Adjusted LIBO Rate for the applicable Interest Period in effect for such Loan,
plus, in each case, the Applicable Margins in effect from time to time.
(b) The Borrower shall pay interest on each Swingline Loan
at the Swingline Rate in effect from time to time.
(c) Notwithstanding clauses (a) and (b) above, while an
Event of Default exists, at the option of the Required Lenders, and after
acceleration, the Borrower shall pay interest ("Default Interest") with respect
to all Eurodollar Loans at the rate otherwise applicable for the then-current
Interest Period plus an additional 2% per annum until the last day of such
Interest Period, and thereafter, and with respect to all Base Rate Loans, all
Swingline Loans and all other Obligations hereunder (other than Loans), at an
all-in rate in effect for Base Rate Loans, plus an additional 2% per annum.
(d) Interest on the principal amount of all Loans shall
accrue from and including the date such Loans are made to but excluding the date
of any repayment thereof. Interest on all outstanding Base Rate Loans and
Swingline Loans shall be payable quarterly in arrears on the last day of each
March, June, September and December and on the Revolving Commitment Termination
Date and the Maturity Date, as the case may be. Interest on all outstanding
Eurodollar Loans shall be payable on the last day of each Interest Period
applicable thereto, and, in the case of any Eurodollar Loans having an Interest
Period in excess of three months, on each day which occurs every three months
after the initial date of such Interest Period, and on the Revolving Commitment
Termination Date or the Maturity Date, as the case may be. Interest on any Loan
which is converted into a Loan of another Type or which is repaid or prepaid
shall be payable on the date of such conversion or on the date of any such
repayment or prepayment (on the amount repaid or prepaid) thereof. All Default
Interest shall be payable on demand.
32
(e) The Administrative Agent shall determine each interest
rate applicable to the Loans hereunder and shall promptly notify the Borrower
and the Lenders of such rate in writing (or by telephone, promptly confirmed in
writing). Any such determination shall be conclusive and binding for all
purposes, absent manifest error.
Section 2.15. Fees.
(a) The Borrower shall pay to the Administrative Agent for
its own account fees in the amounts and at the times previously agreed upon in
writing by the Borrower and the Administrative Agent.
(b) The Borrower agrees to pay to the Administrative Agent
for the ratable benefit of the Lenders a commitment fee, which shall accrue at
the Applicable Commitment Fee Percentage per annum (determined daily in
accordance with Schedule I) on the average daily amount of the unused Revolving
Commitments of the Lenders during the Availability Period. For purposes of
computing commitment fees with respect to the Revolving Commitments, the
Revolving Commitment of each Lender shall be deemed used to the extent of the
outstanding Revolving Loans and LC Exposure, but not Swingline Exposure, of such
Lender.
(c) The Borrower agrees to pay (i) to the Administrative
Agent, for the account of each Lender, a letter of credit fee with respect to
its participation in each Letter of Credit, which shall accrue at a rate per
annum equal to the Applicable Margin for Eurodollar Loans then in effect on the
average daily amount of such Lender's LC Exposure attributable to such Letter of
Credit during the period from and including the date of issuance of each Letter
of Credit to but excluding the date on which such Letter of Credit expires or is
drawn in full (including without limitation any LC Exposure that remains
outstanding after the Revolving Commitment Termination Date) and (ii) to the
Issuing Bank for its own account a fronting fee, which shall accrue at the rate
of 0.10% per annum on the average daily amount of the LC Exposure during the
Availability Period (or until the date that such Letter of Credit is irrevocably
cancelled, whichever is later), as well as the Issuing Bank's standard fees with
respect to issuance, amendment, renewal or extension of any Letter of Credit or
processing of drawings thereunder. Notwithstanding the foregoing, if the
Required Lenders elect to increase interest on the Loans to the Default Interest
pursuant to Section 2.14(c), the letter of credit fees payable pursuant to
clause (i) above shall automatically be increased by an additional 2% per annum.
(d) The Borrower shall pay to the Administrative Agent, for
the ratable benefit of each Lender, the closing fee previously agreed upon by
the Borrower and the Administrative Agent, which shall be due and payable on the
Closing Date.
(e) Accrued fees (other than the closing fee referenced in
paragraph (d)) shall be payable quarterly in arrears on the last day of each
March, June, September and December, commencing on June 30, 2003 and on the
Revolving Commitment Termination Date (and if later, the date the Loans and LC
Exposure shall be repaid in their entirety); provided further, that any such
fees accruing after the Revolving Commitment Termination Date shall be payable
on demand.
33
Section 2.16. Computation of Interest and Fees. Interest
hereunder based on the Administrative Agent's prime lending rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year) and
paid for the actual number of days elapsed (including the first day but
excluding the last day). All other computations of interest and fees hereunder
shall be computed on the basis of a year of 360 days and paid for the actual
number of days (including the first day but excluding the last day) occurring in
the period for which such interest or fees are payable (to the extent computed
on the basis of days elapsed). Each determination by the Administrative Agent of
an interest rate or fee hereunder shall be made in good faith and, except for
manifest error, shall be final, conclusive and binding for all purposes.
Section 2.17. Inability to Determine Interest Rates. If
prior to the commencement of any Interest Period for any Eurodollar Borrowing,
(i) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower absent
manifest error) that, by reason of circumstances affecting the relevant
interbank market, adequate means do not exist for ascertaining LIBOR for
such Interest Period, or
(ii) the Administrative Agent shall have received notice from
the Required Lenders that the Adjusted LIBO Rate does not adequately and
fairly reflect the cost to such Lenders of making, funding or
maintaining their (or its, as the case may be) Eurodollar Loans for such
Interest Period,
the Administrative Agent shall give written notice (or telephonic notice,
promptly confirmed in writing) to the Borrower and to the Lenders as soon as
practicable thereafter. In the case of Eurodollar Loans, until the
Administrative Agent shall notify the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) the obligations of
the Lenders to make Eurodollar Revolving Loans or to continue or convert
outstanding Loans as or into Eurodollar Loans shall be suspended and (ii) all
such affected Loans shall be converted into Base Rate Loans on the last day of
the then current Interest Period applicable thereto unless the Borrower prepays
such Loans in accordance with this Agreement. Unless the Borrower notifies the
Administrative Agent at least one Business Day before the date of any Eurodollar
Revolving Borrowing for which a Notice of Revolving Borrowing has previously
been given that it elects not to borrow on such date, then such Revolving
Borrowing shall be made as a Base Rate Borrowing.
Section 2.18. Illegality. If any Change in Law shall make it
unlawful or impossible for any Lender to make, maintain or fund any Eurodollar
Loan and such Lender shall so notify the Administrative Agent, the
Administrative Agent shall promptly give notice thereof to the Borrower and the
other Lenders, whereupon until such Lender notifies the Administrative Agent and
the Borrower that the circumstances giving rise to such suspension no longer
exist, the obligation of such Lender to make Eurodollar Revolving Loans, or to
continue or convert outstanding Loans as or into Eurodollar Loans, shall be
suspended. In the case of the making of a Eurodollar Revolving Borrowing, such
Lender's Revolving Loan shall be made as a Base Rate Loan as part of the same
Revolving Borrowing for the same Interest Period and if the affected Eurodollar
Loan is then outstanding, such Loan shall be converted to a Base Rate Loan
either (i) on the last day of the then current Interest Period applicable to
such Eurodollar Loan if such
34
Lender may lawfully continue to maintain such Loan to such date or (ii)
immediately if such Lender shall determine that it may not lawfully continue to
maintain such Eurodollar Loan to such date. Notwithstanding the foregoing, the
affected Lender shall, prior to giving such notice to the Administrative Agent,
designate a different Applicable Lending Office if such designation would avoid
the need for giving such notice and if such designation would not otherwise be
disadvantageous to such Lender in the good faith exercise of its discretion.
Section 2.19. Increased Costs.
(a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement that is not otherwise included in the
determination of the Adjusted LIBO Rate hereunder against assets of,
deposits with or for the account of, or credit extended by, any Lender
(except any such reserve requirement reflected in the Adjusted LIBO
Rate) or the Issuing Bank; or
(ii) impose on any Lender or on the Issuing Bank or the
eurodollar interbank market any other condition affecting this Agreement
or any Eurodollar Loans made by such Lender or any Letter of Credit or
any participation therein;
and the result of either of the foregoing is to increase the cost to such Lender
of making, converting into, continuing or maintaining a Eurodollar Loan or to
increase the cost to such Lender or the Issuing Bank of participating in or
issuing any Letter of Credit or to reduce the amount received or receivable by
such Lender or the Issuing Bank hereunder (whether of principal, interest or any
other amount), then the Borrower shall promptly pay, upon written notice from
and demand by such Lender on the Borrower (with a copy of such notice and demand
to the Administrative Agent), to the Administrative Agent for the account of
such Lender, within five Business Days after the date of such notice and demand,
additional amount or amounts sufficient to compensate such Lender or the Issuing
Bank, as the case may be, for such additional costs incurred or reduction
suffered.
(b) If any Lender or the Issuing Bank shall have determined
that on or after the date of this Agreement any Change in Law regarding capital
requirements has or would have the effect of reducing the rate of return on such
Lender's or the Issuing Bank's capital (or on the capital of such Lender's or
the Issuing Bank's parent corporation) as a consequence of its obligations
hereunder or under or in respect of any Letter of Credit to a level below that
which such Lender or the Issuing Bank or such Lender's or the Issuing Bank's
parent corporation could have achieved but for such Change in Law (taking into
consideration such Lender's or the Issuing Bank's policies or the policies of
such Lender's or the Issuing Bank's parent corporation with respect to capital
adequacy) then, from time to time, within five (5) Business Days after receipt
by the Borrower of written demand by such Lender (with a copy thereof to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amounts as will compensate such Lender or the Issuing Bank or such Lender's or
the Issuing Bank's parent corporation for any such reduction suffered.
35
(c) A certificate of a Lender or the Issuing Bank setting
forth the amount or amounts necessary to compensate such Lender or the Issuing
Bank or such Lender's or the Issuing Bank's parent corporation, as the case may
be, specified in paragraph (a) or (b) of this Section shall be delivered to the
Borrower (with a copy to the Administrative Agent) and shall be conclusive,
absent manifest error. The Borrower shall pay any such Lender or the Issuing
Bank, as the case may be, such amount or amounts within 10 days after receipt
thereof.
(d) Failure or delay on the part of any Lender or the
Issuing Bank to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender's or the Issuing Bank's right to demand such
compensation; provided, that the Borrower shall not be required to compensate a
Lender or the Issuing Bank under this Section for any increased costs or
reductions incurred more than twelve (12) months prior to the date that such
Lender or the Issuing Bank, as the case may be, notifies the Borrower of such
increased costs or reductions and of such Lender's or the Issuing Bank's
intention to claim compensation therefor; provided further, that if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
such twelve-month period shall be extended to include the period of such
retroactive effect.
Section 2.20. Funding Indemnity. In the event of (a) the
payment of any principal of a Eurodollar Loan other than on the last day of the
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion or continuation of a Eurodollar Loan other than on
the last day of the Interest Period applicable thereto, or (c) the failure by
the Borrower to borrow, prepay, convert or continue any Eurodollar Loan on the
date specified in any applicable notice (regardless of whether such notice is
withdrawn or revoked), then, in any such event, the Borrower shall compensate
each Lender, within five (5) Business Days after written demand from such
Lender, for any loss, cost or expense (other than lost profits) attributable to
such event. In the case of a Eurodollar Loan, such loss, cost or expense shall
be deemed to include an amount determined by such Lender to be the excess, if
any, of (A) the amount of interest that would have accrued on the principal
amount of such Eurodollar Loan if such event had not occurred at the Adjusted
LIBO Rate applicable to such Eurodollar Loan for the period from the date of
such event to the last day of the then current Interest Period therefor (or in
the case of a failure to borrow, convert or continue, for the period that would
have been the Interest Period for such Eurodollar Loan) over (B) the amount of
interest that would accrue on the principal amount of such Eurodollar Loan for
the same period if the Adjusted LIBO Rate were set on the date such Eurodollar
Loan was prepaid or converted or the date on which the Borrower failed to
borrow, convert or continue such Eurodollar Loan. A certificate as to any
additional amount payable under this Section 2.20, showing a calculation of the
amount payable in reasonable detail to the extent reasonably practicable,
submitted to the Borrower by any Lender (with a copy to the Administrative
Agent) shall be conclusive, absent manifest error.
Section 2.21. Taxes.
(a) Any and all payments by or on account of any obligation
of the Borrower hereunder shall be made free and clear of and without deduction
for any Indemnified Taxes or Other Taxes; provided, that if the Borrower shall
be required to deduct any Indemnified Taxes or Other Taxes from such payments,
then (i) the sum payable shall be increased as necessary so that after making
all required deductions (including deductions applicable to additional sums
payable under this Section) the Administrative Agent, any Lender or the Issuing
Bank (as the case may
36
be) shall receive an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and (iii) the
Borrower shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to
the relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent,
each Lender and the Issuing Bank, within ten (10) Business Days after written
demand therefor, for the full amount of any Indemnified Taxes or Other Taxes
paid by the Administrative Agent, such Lender or the Issuing Bank, as the case
may be, on or with respect to any payment by or on account of any obligation of
the Borrower hereunder (including Indemnified Taxes or Other Taxes imposed or
asserted on or attributable to amounts payable under this Section) and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. A
certificate as to the amount of such payment or liability delivered to the
Borrower by a Lender or the Issuing Bank, or by the Administrative Agent on its
own behalf or on behalf of a Lender or the Issuing Bank, shall be conclusive,
absent manifest error.
(d) As soon as practicable after any payment of Indemnified
Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from
or reduction of withholding tax under the Code or any treaty to which the United
States is a party, with respect to payments under this Agreement shall deliver
to the Borrower (with a copy to the Administrative Agent), at the time or times
prescribed by applicable law, such properly completed and executed documentation
prescribed by applicable law or reasonably requested by the Borrower as will
permit such payments to be made without withholding or at a reduced rate.
Without limiting the generality of the foregoing, each Foreign Lender agrees
that it will deliver to the Administrative Agent and the Borrower (or in the
case of a Participant, to the Lender from which the related participation shall
have been purchased), as appropriate, two (2) duly completed copies of (i)
Internal Revenue Service Form W-8 ECI, or any successor form thereto, certifying
that the payments received from the Borrower hereunder are effectively connected
with such Foreign Lender's conduct of a trade or business in the United States;
or (ii) Internal Revenue Service Form W-8 BEN, or any successor form thereto,
certifying that such Foreign Lender is entitled to benefits under an income tax
treaty to which the United States is a party which reduces the rate of
withholding tax on payments of interest; or (iii) Internal Revenue Service Form
W-8 BEN, or any successor form prescribed by the Internal Revenue Service,
together with a certificate (A) establishing that the payment to the Foreign
Lender qualifies as "portfolio interest" exempt from U.S. withholding tax under
Code section 871(h) or 881(c), and (B) stating that (1) the Foreign Lender is
not a bank for purposes of Code section 881(c)(3)(A), or the obligation of the
Borrower hereunder is not, with respect to such Foreign Lender, a loan agreement
entered into in the ordinary course of its trade or business, within the meaning
of that section; (2) the Foreign Lender is not a 10% shareholder of the Borrower
within the meaning of
37
Code section 871(h)(3) or 881(c)(3)(B); and (3) the Foreign Lender is not a
controlled foreign corporation that is related to the Borrower within the
meaning of Code section 881(c)(3)(C); or (iv) such other Internal Revenue
Service forms as may be applicable to the Foreign Lender, including Forms W-8
IMY or W-8 EXP. Each such Foreign Lender shall deliver to the Borrower and the
Administrative Agent such forms on or before the date that it becomes a party to
this Agreement (or in the case of a Participant, on or before the date such
Participant purchases the related participation). In addition, each such Foreign
Lender shall deliver such forms promptly upon the obsolescence or invalidity of
any form previously delivered by such Foreign Lender. Each such Foreign Lender
shall promptly notify the Borrower and the Administrative Agent at any time that
it determines that it is no longer in a position to provide any previously
delivered certificate to the Borrower (or any other form of certification
adopted by the Internal Revenue Service for such purpose).
Section 2.22. Payments Generally; Pro Rata Treatment;
Sharing of Set-offs.
(a) The Borrower shall make each payment required to be made
by it hereunder (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Section 2.19, 2.20 or 2.21, or
otherwise) prior to 11:00 a.m. (Atlanta, GA time), on the date when due, in
immediately available funds, free and clear of any defenses, rights of set-off,
counterclaim, or withholding or deduction of taxes. Any amounts received after
such time on any date may, in the discretion of the Administrative Agent, be
deemed to have been received on the next succeeding Business Day for purposes of
calculating interest thereon. All such payments shall be made to the
Administrative Agent at the Payment Office, except payments to be made directly
to the Issuing Bank or Swingline Lender as expressly provided herein and except
that payments pursuant to Sections 2.19, 2.20 and 2.21 and 10.3 shall be made
directly to the Persons entitled thereto. The Administrative Agent shall
distribute any such payments received by it for the account of any other Person
to the appropriate recipient promptly following receipt thereof. If any payment
hereunder shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day, and, in the case of any
payment accruing interest, interest thereon shall be made payable for the period
of such extension. All payments hereunder shall be made in Dollars.
(b) If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
unreimbursed LC Disbursements, interest and fees then due hereunder, such funds
shall be applied (i) first, towards payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second, towards
payment of principal and unreimbursed LC Disbursements then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal and unreimbursed LC Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of set-off
or counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Revolving Loans or participations in LC Disbursements or
Swingline Loans that would result in such Lender receiving payment of a greater
proportion of the aggregate amount of its Revolving Loans and participations in
LC Disbursements and Swingline Loans and accrued interest thereon than the
proportion received by any other Lender, then the Lender receiving such greater
proportion (each
38
a "Purchasing Lender") shall purchase (for cash at face value) participations in
the Revolving Loans and participations in LC Disbursements and Swingline Loans
of other Lenders to the extent necessary so that the benefit of all such
payments shall be shared by the Lenders ratably in accordance with the aggregate
amount of principal of and accrued interest on their respective Revolving Loans
and participations in LC Disbursements and Swingline Loans; provided, that (i)
if any such participations are purchased and all or any portion of the payment
giving rise thereto is recovered or the Purchasing Lender is otherwise required
to return or restore any such payment, such participations shall be rescinded
and each other Lender shall, promptly after request from the Administrative
Agent or the Purchasing Lender, return to the Purchasing Lender the purchase
price for such participation to the extent of such recovery or the amount
otherwise returned or restored by the Purchasing Lender, without interest, and
(ii) the provisions of this paragraph shall not be construed to apply to any
payment made by the Borrower pursuant to and in accordance with the express
terms of this Agreement or any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Loans or
participations in LC Disbursements or Swingline Loans to any assignee or
participant, other than to the Borrower or any Subsidiary or Affiliate thereof
(as to which the provisions of this paragraph shall apply). The Borrower
consents to the foregoing and agrees, to the extent it may effectively do so
under applicable law, that any Lender acquiring a participation pursuant to the
foregoing arrangements may exercise against the Borrower rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower in the amount of such participation.
(d) Unless the Administrative Agent shall have received
notice from the Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or the Issuing Bank
hereunder that the Borrower will not make such payment, the Administrative Agent
may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders or
the Issuing Bank, as the case may be, the amount or amounts due. In such event,
if the Borrower has not in fact made such payment, then each of the Lenders or
the Issuing Bank, as the case may be, severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such
Lender or Issuing Bank with interest thereon, for each day from and including
the date such amount is distributed to it to but excluding the date of payment
to the Administrative Agent, at the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to
be made by it pursuant to Section 2.5(b), 2.23(c) or (d), 2.7(b) or 10.3(d),
then the Administrative Agent may, in its discretion (notwithstanding any
contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender's
obligations under such Sections until all such unsatisfied obligations are fully
paid.
Section 2.23. Letters of Credit.
(a) During the Availability Period, the Issuing Bank, in
reliance upon the agreements of the other Lenders pursuant to Section 2.23(d),
agrees to issue, at the request of the Borrower, Letters of Credit for the
account of the Borrower on the terms and conditions
39
hereinafter set forth; provided, that (i) each Letter of Credit shall expire on
the earlier of (A) the date one year after the date of issuance of such Letter
of Credit (or in the case of any renewal or extension thereof, one year after
such renewal or extension) and (B) the date that is at least one (1) Business
Day prior to the Revolving Commitment Termination Date; (ii) each Letter of
Credit shall be in a stated amount of at least $50,000; and (iii) the Borrower
may not request any Letter of Credit, if, after giving effect to such issuance
(A) the aggregate LC Exposure would exceed the LC Commitment or (B) the
aggregate LC Exposure, plus the aggregate outstanding Revolving Loans and
Swingline Loans of all Lenders would exceed the Aggregate Revolving Commitment
Amount. Upon the issuance of each Letter of Credit each Lender shall be deemed
to, and hereby irrevocably and unconditionally agrees to, purchase from the
Issuing Bank without recourse a participation in such Letter of Credit equal to
such Lender's Pro Rata Share of the aggregate amount available to be drawn under
such Letter of Credit. Each issuance of a Letter of Credit shall be deemed to
utilize the Revolving Commitment of each Lender by an amount equal to the amount
of such participation.
(b) To request the issuance of a Letter of Credit (or any
amendment, renewal or extension of an outstanding Letter of Credit), the
Borrower shall give the Issuing Bank and the Administrative Agent irrevocable
written notice at least three (3) Business Days prior to the requested date of
such issuance specifying the date (which shall be a Business Day) such Letter of
Credit is to be issued (or amended, extended or renewed, as the case may be),
the expiration date of such Letter of Credit, the amount of such Letter of
Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare, amend, renew or extend such Letter
of Credit. In addition to the satisfaction of the conditions in Article III, the
issuance of such Letter of Credit (or any amendment which increases the amount
of such Letter of Credit) will be subject to the further conditions that such
Letter of Credit shall be in such form and contain such terms as the Issuing
Bank shall approve and that the Borrower shall have executed and delivered any
additional applications, agreements and instruments relating to such Letter of
Credit as the Issuing Bank shall reasonably require; provided, that in the event
of any conflict between such applications, agreements or instruments and this
Agreement, the terms of this Agreement shall control.
(c) At least two Business Days prior to the issuance of any
Letter of Credit, the Issuing Bank will confirm with the Administrative Agent
(by telephone or in writing) that the Administrative Agent has received such
notice and if not, the Issuing Bank will provide the Administrative Agent with a
copy thereof. Unless the Issuing Bank has received notice from the
Administrative Agent on or before the Business Day immediately preceding the
date the Issuing Bank is to issue the requested Letter of Credit (1) directing
the Issuing Bank not to issue the Letter of Credit because such issuance is not
then permitted hereunder because of the limitations set forth in Section 2.23(a)
or (2) that one or more conditions specified in Article III are not then
satisfied, then, subject to the terms and conditions hereof, the Issuing Bank
shall, on the requested date, issue such Letter of Credit in accordance with the
Issuing Bank's usual and customary business practices.
(d) The Issuing Bank shall examine all documents purporting
to represent a demand for payment under a Letter of Credit promptly following
its receipt thereof. The Issuing Bank shall notify the Borrower and the
Administrative Agent of such demand for payment and whether the Issuing Bank has
made or will make a LC Disbursement thereunder; provided, that
40
any failure to give or delay in giving such notice shall not relieve the
Borrower of its obligation to reimburse the Issuing Bank and the Lenders with
respect to such LC Disbursement. The Borrower shall be irrevocably and
unconditionally obligated to reimburse the Issuing Bank for any LC Disbursements
paid by the Issuing Bank in respect of such drawing, without presentment, demand
or other formalities of any kind. Unless the Borrower shall have notified the
Issuing Bank and the Administrative Agent prior to 11:00 a.m. (Atlanta, GA time)
on the Business Day immediately prior to the date on which such drawing is
honored that the Borrower intends to reimburse the Issuing Bank for the amount
of such drawing in funds other than from the proceeds of Revolving Loans, the
Borrower shall be deemed to have timely given a Notice of Revolving Borrowing to
the Administrative Agent requesting the Lenders to make a Base Rate Borrowing on
the date on which such drawing is honored in an exact amount due to the Issuing
Bank; provided, that for purposes solely of such Borrowing, the conditions
precedent set forth in Section 3.2 hereof shall not be applicable. The
Administrative Agent shall notify the Lenders of such Borrowing in accordance
with Section 2.3, and each Lender shall make the proceeds of its Base Rate Loan
included in such Borrowing available to the Administrative Agent for the account
of the Issuing Bank in accordance with Section 2.7. The proceeds of such
Borrowing shall be applied directly by the Administrative Agent to reimburse the
Issuing Bank for such LC Disbursement.
(e) If for any reason a Base Rate Borrowing may not be (as
determined in the sole discretion of the Administrative Agent), or is not, made
in accordance with the foregoing provisions, then each Lender (other than the
Issuing Bank) shall be obligated to fund the participation that such Lender
purchased pursuant to subsection (a) in an amount equal to its Pro Rata Share of
such LC Disbursement on and as of the date which such Base Rate Borrowing should
have occurred. Each Lender's obligation to fund its participation shall be
absolute and unconditional and shall not be affected by any circumstance,
including without limitation (i) any setoff, counterclaim, recoupment, defense
or other right that such Lender or any other Person may have against the Issuing
Bank or any other Person for any reason whatsoever, (ii) the existence of a
Default or an Event of Default or the termination of the Aggregate Revolving
Commitments, (iii) any adverse change in the condition (financial or otherwise)
of the Borrower or any of its Subsidiaries, (iv) any breach of this Agreement by
the Borrower or any other Lender, (v) any amendment, renewal or extension of any
Letter of Credit or (vi) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing. On the date that such
participation is required to be funded, each Lender shall promptly transfer, in
immediately available funds, the amount of its participation to the
Administrative Agent for the account of the Issuing Bank. Whenever, at any time
after the Issuing Bank has received from any such Lender the funds for its
participation in a LC Disbursement, the Issuing Bank (or the Administrative
Agent on its behalf) receives any payment on account thereof, the Administrative
Agent or the Issuing Bank, as the case may be, will distribute to such Lender
its Pro Rata Share of such payment; provided, that if such payment is required
to be returned for any reason to the Borrower or to a trustee, receiver,
liquidator, custodian or similar official in any bankruptcy proceeding, such
Lender will return to the Administrative Agent or the Issuing Bank any portion
thereof previously distributed by the Administrative Agent or the Issuing Bank
to it.
(f) To the extent that any Lender shall fail to pay any
amount required to be paid pursuant to paragraph (e) of this Section 2.23 on the
due date therefor, such Lender shall pay interest to the Issuing Bank (through
the Administrative Agent) on such amount from such
41
due date to the date such payment is made at a rate per annum equal to the
Federal Funds Rate; provided, that if such Lender shall fail to make such
payment to the Issuing Bank within three (3) Business Days of such due date,
then, retroactively to the due date, such Lender shall be obligated to pay
interest on such amount at the Default Rate.
(g) If any Event of Default shall occur and be continuing,
on the Business Day that the Borrower receives notice from the Administrative
Agent or the Required Lenders demanding the deposit of cash collateral pursuant
to this paragraph, the Borrower shall deposit in an account with the
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Issuing Bank and the Lenders, an amount in cash equal to the LC
Exposure as of such date plus any accrued and unpaid fees thereon; provided,
that the obligation to deposit such cash collateral shall become effective
immediately, and such deposit shall become immediately due and payable, without
demand or notice of any kind, upon the occurrence of any Event of Default with
respect to the Borrower described in clause (f) or (g) of Section 8.1. Such
deposit shall be held by the Administrative Agent as collateral for the payment
and performance of the obligations of the Borrower under this Agreement. The
Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account. Borrower agrees to execute any
documents and/or certificates that may be necessary to effectuate the intent of
this paragraph. Other than any interest earned on the investment of such
deposits, which investments shall be made at the option and sole discretion of
the Administrative Agent and at the Borrower's risk and expense, such deposits
shall not bear interest. Interest and profits, if any, on such investments shall
accumulate in such account. Moneys in such account shall be applied by the
Administrative Agent to reimburse the Issuing Bank for LC Disbursements for
which it had not been reimbursed and to the extent so applied, shall be held for
the satisfaction of the reimbursement obligations of the Borrower for the LC
Exposure at such time or, if the maturity of the Loans has been accelerated,
with the consent of the Required Lenders, be applied to satisfy other
obligations of the Borrower under this Agreement and the other Loan Documents.
If the Borrower is required to provide an amount of cash collateral hereunder as
a result of the occurrence of an Event of Default, such amount (to the extent
not so applied as aforesaid) shall be returned to the Borrower within three
Business Days after all Events of Default have been cured or waived.
(h) Promptly following the end of each Fiscal Quarter, the
Issuing Bank shall deliver (through the Administrative Agent) to each Lender and
the Borrower a report describing the aggregate Letters of Credit outstanding at
the end of such Fiscal Quarter. Upon the request of any Lender from time to
time, the Issuing Bank shall deliver to such Lender any other information
reasonably requested by such Lender with respect to each Letter of Credit then
outstanding.
(i) The Borrower's obligation to reimburse LC Disbursements
hereunder shall be absolute, unconditional and irrevocable and shall be
performed strictly in accordance with the terms of this Agreement under all
circumstances whatsoever and irrespective of any of the following circumstances:
(i) Any lack of validity or enforceability of any
Letter of Credit or this Agreement;
42
(ii) The existence of any claim, set-off, defense or
other right which the Borrower or any Subsidiary or Affiliate of the
Borrower may have at any time against a beneficiary or any transferee of
any Letter of Credit (or any Persons or entities for whom any such
beneficiary or transferee may be acting), any Lender (including the
Issuing Bank) or any other Person, whether in connection with this
Agreement or the Letter of Credit or any document related hereto or
thereto or any unrelated transaction;
(iii) Any draft or other document presented under a
Letter of Credit proving to be forged, fraudulent or invalid in any
respect or any statement therein being untrue or inaccurate in any
respect;
(iv) Payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or other document to the Issuing
Bank that does not comply with the terms of such Letter of Credit;
(v) Any other event or circumstance whatsoever,
whether or not similar to any of the foregoing, that might, but for the
provisions of this Section, constitute a legal or equitable discharge
of, or provide a right of setoff against, the Borrower's obligations
hereunder; or
(vi) The existence of a Default or an Event of
Default.
Neither the Administrative Agent, the Issuing Bank, the Lenders nor any Related
Party of any of the foregoing shall have any liability or responsibility by
reason of or in connection with the issuance or transfer of any Letter of Credit
or any payment or failure to make any payment thereunder (irrespective of any of
the circumstances referred to above), or any error, omission, interruption, loss
or delay in transmission or delivery of any draft, notice or other communication
under or relating to any Letter of Credit (including any document required to
make a drawing thereunder), any error in interpretation of technical terms or
any consequence arising from causes beyond the control of the Issuing Bank;
provided, that the foregoing shall not be construed to excuse the Issuing Bank
from liability to the Borrower to the extent of any actual direct damages (as
opposed to special, indirect (including claims for lost profits or other
consequential damages), or punitive damages, claims in respect of which are
hereby waived by the Borrower to the extent permitted by applicable law)
suffered by the Borrower that are caused by the Issuing Bank's failure to
exercise due care when determining whether drafts or other documents presented
under a Letter of Credit comply with the terms thereof. The parties hereto
expressly agree, that in the absence of gross negligence or willful misconduct
on the part of the Issuing Bank (as finally determined by a court of competent
jurisdiction), the Issuing Bank shall be deemed to have exercised due care in
each such determination. In furtherance of the foregoing and without limiting
the generality thereof, the parties agree that, with respect to documents
presented that appear on their face to be in substantial compliance with the
terms of a Letter of Credit, the Issuing Bank may, in its sole discretion,
either accept and make payment upon such documents without responsibility for
further investigation, regardless of any notice or information to the contrary,
or refuse to accept and make payment upon such documents if such documents are
not in strict compliance with the terms of such Letter of Credit.
43
(j) Each Letter of Credit shall be subject to the Uniform
Customs and Practices for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500, as the same may be amended from time to
time, and, to the extent not inconsistent therewith, the governing law of this
Agreement set forth in Section 10.5.
Section 2.24. Extension of Revolving Commitment Termination
Date.
(a) At least 60 but not more than 90 days prior to the first two
anniversaries of the Closing Date, the Borrower, by delivering a written request
to the Administrative Agent (such request being irrevocable), may request that
the Revolving Commitment Termination Date be extended for an additional one-year
period. Upon receipt of such notice, the Administrative Agent shall promptly
communicate such request to the Lenders.
(b) No earlier than 60 days prior, and no later than 45 days
prior, to such anniversary, the Lenders shall indicate to the Administrative
Agent whether the Borrower's request to so extend such Revolving Commitment
Termination Date is acceptable to the Lenders, it being understood that the
determination by each Lender will be in its sole and absolute discretion and
that the failure of any Lender to so respond within such period shall be deemed
to constitute a refusal by such Lender to consent to such request, with the
result being that such request is denied. The Administrative Agent shall notify
the Borrower, in writing, of the Lenders' decisions no later than 30 days prior
to such anniversary.
(c) Subject to the satisfaction of the conditions set forth in
Section 3.2, in the event that all of the Lenders have consented to the
Borrower's request to extend the Revolving Commitment Termination Date, the
Revolving Commitment Termination Date shall be extended for an additional
one-year period.
Section 2.25. Mitigation of Obligations. If any Lender
requests compensation under Section 2.19, or if the Borrower is required to pay
any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 2.21, then such Lender shall use
reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder or to assign its rights and obligations hereunder to
another of its offices, branches or affiliates, if, in the sole judgment of such
Lender, such designation or assignment (i) would eliminate or reduce amounts
payable under Section 2.19 or Section 2.21, as the case may be, in the future
and (ii) would not subject such Lender to any unreimbursed cost or expense and
would not otherwise be disadvantageous to such Lender. The Borrower hereby
agrees to pay all costs and expenses incurred by any Lender in connection with
such designation or assignment.
Section 2.26. Replacement of Lenders. If any Lender requests
compensation under Section 2.19, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority of the account of
any Lender pursuant to Section 2.21, or if any Lender defaults in its obligation
to fund Loans hereunder, then the Borrower may, at its sole expense and effort,
upon notice to such Lender and the Administrative Agent, require such Lender to
assign and delegate, without recourse (in accordance with and subject to the
restrictions set forth in Section 10.4(b) all its interests, rights and
obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided, that (i) the Borrower shall have received the prior
written consent of
44
the Administrative Agent, which consent shall not be unreasonably withheld, (ii)
such Lender shall have received payment of an amount equal to the outstanding
principal amount of all Loans owed to it, accrued interest thereon, accrued fees
and all other amounts payable to it hereunder, from the assignee (in the case of
such outstanding principal and accrued interest) and from the Borrower (in the
case of all other amounts) and (iii) in the case of a claim for compensation
under Section 2.19 or payments required to be made pursuant to Section 2.21,
such assignment will result in a reduction in such compensation or payments. A
Lender shall not be required to make any such assignment and delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrower to require such assignment and delegation
cease to apply.
ARTICLE III
CONDITIONS PRECEDENT TO LOANS AND LETTERS OF CREDIT
Section 3.1. Conditions To Effectiveness. The obligations of
the Lenders (including the Swingline Lender) to make Loans and the obligation of
the Issuing Bank to issue any Letter of Credit hereunder shall not become
effective until the first date on which each of the following conditions is
satisfied (or waived in accordance with Section 10.2).
(a) The Administrative Agent shall have received all fees
and other amounts due and payable on or prior to the Closing Date, including
reimbursement or payment of all out-of-pocket expenses (including reasonable
fees, charges and disbursements of counsel to the Administrative Agent) required
to be reimbursed or paid by the Borrower hereunder, under any other Loan
Document and under any agreement with the Administrative Agent or SunTrust
Capital Markets, Inc., as Arranger.
(b) The Administrative Agent (or its counsel) shall have
received the following:
(i) a counterpart of this Agreement signed by or on
behalf of each party hereto or written evidence satisfactory to the
Administrative Agent (which may include telecopy transmission of a
signed signature page of this Agreement) that such party has signed a
counterpart of this Agreement;
(ii) if requested by any Lender, a duly executed
Syndicated Note payable to such Lender, and a duly executed Swingline
Note payable to the Swingline Lender;
(iii) the Subsidiary Guaranty Agreement, duly executed
by each Subsidiary Loan Party;
(iv) evidence that all outstanding "Obligations" (as
defined in the Existing Credit Agreement) will be repaid in full upon
funding of the initial Loan and that the Existing Credit Agreement will
be terminated on the Closing Date, in form and substance satisfactory to
the Administrative Agent;
45
(v) the Security Agreement, duly executed by the
Borrower and each Subsidiary Loan Party, together with (A) UCC financing
statements and other applicable documents under the laws of the
jurisdictions with respect to the perfection of the Liens granted under
the Security Agreement, as requested by the Administrative Agent in
order to perfect such Liens, duly executed or authorized (as
appropriate) by the Borrower and the Subsidiary Loan Parties, (B) copies
of favorable UCC, tax, judgment and lien search reports in all necessary
or appropriate jurisdictions and under all legal and trade names of the
Borrower and the Subsidiary Loan Parties requested by the Lenders,
indicating that there are no prior Liens on any of the Collateral other
than Liens permitted under Section 7.2 hereof, (C) a Perfection
Certificate duly completed and executed by the Borrower, (D) duly
executed landlord waivers as reasonably requested by the Administrative
Agent and (E) a certified copy of all material real property leases;
(vi) the Pledge Agreement, duly executed by the
Borrower and each of its Domestic Subsidiaries that owns another
Subsidiary of Borrower, together with (A) original certificates
evidencing the issued and outstanding shares of Capital Stock pledged to
the Administrative Agent pursuant to the Pledge Agreement, (B) stock
powers or other appropriate instruments of transfer executed in blank,
and (C) executed originals of all promissory notes evidencing
Indebtedness represented by promissory notes between the Loan Parties,
in form and substance satisfactory to the Administrative Agent, endorsed
in blank;
(vii) The Trademark Security Agreements and Patent
Security Agreements, each dated the Closing Date and duly executed by
each Loan Party which owns Trademarks and/or Patents, as applicable, all
in form and substance reasonably satisfactory to the Administrative
Agent, together with all instruments, documents and agreements executed
pursuant thereto;
(viii) Blocked Account Agreements for (i) all deposit
and disbursement bank accounts maintained with the Lenders and (ii) for
any other deposit and disbursement bank account maintained with other
financial institutions to the extent that the average balances in such
accounts, during any one-month period, exceeds $5,000,000, in the
aggregate, in each case in form and substance reasonably satisfactory to
the Administrative Agent;
(ix) a certificate of the Secretary or Assistant
Secretary of each Loan Party, attaching and certifying copies of its
bylaws and of the resolutions of its boards of directors, or partnership
agreement or limited liability company operating agreement, or
comparable organizational documents and authorizations, authorizing the
execution, delivery and performance of the Loan Documents to which it is
a party and certifying the name, title and true signature of each
officer of such Loan Party executing the Loan Documents to which it is a
party;
(x) certified copies of the articles or certificate
of incorporation, certificate of organization or limited partnership, or
other registered organizational documents of each Loan Party, together
with certificates of good standing or existence, as may be available
from the Secretary of State of the jurisdiction of organization of such
46
Loan Party and each other jurisdiction where the failure of any Loan
Party to be qualified to do business as a foreign corporation or limited
liability company, as the case may be, could reasonably be expected to
have a Material Adverse Effect;
(xi) favorable written opinions from counsel to the
Loan Parties, addressed to the Administrative Agent and each of the
Lenders, and covering such matters relating to the Loan Parties, the
Loan Documents and the transactions contemplated therein as the
Administrative Agent shall reasonably request;
(xii) a certificate, dated the Closing Date and signed
by a Responsible Officer, confirming compliance with the conditions set
forth in paragraphs (a), (b) and (c) of Section 3.2;
(xiii) a Notice of Borrowing duly executed by the
Borrower;
(xiv) a funds disbursement agreement duly executed by
the Borrower;
(xv) certified copies of all consents, approvals,
authorizations, registrations and filings and orders required to be made
or obtained under any Requirement of Law, or by any material Contractual
Obligation of each Loan Party, in connection with the execution,
delivery, performance, validity and enforceability of the Loan Documents
or any of the transactions contemplated thereby, and such consents,
approvals, authorizations, registrations, filings and orders shall be in
full force and effect and all applicable waiting periods shall have
expired and no investigation or inquiry by any Governmental Authority
related thereto shall be ongoing;
(xvi) copies of (A) the internally prepared quarterly
financial statements of Borrower and its Subsidiaries on a consolidated
basis for the Fiscal Quarter ending on January 31, 2003, and (B) the
audited consolidated financial statements for Borrower and its
Subsidiaries for the Fiscal Years ended 2000, 2001 and 2002;
(xvii) a certificate, dated the Closing Date and signed
by the chief financial officer of each Loan Party, confirming the
solvency of each Loan Party before and after giving effect to all
transactions contemplated by the Transaction Documents, together with a
Pro Forma Balance Sheet for Borrower as of the Closing Date;
(xviii) certificates of insurance issued on behalf of
insurers of the Borrower and its Subsidiaries, describing in reasonable
detail the types and amounts of insurance (property and liability)
maintained by the Borrower and its Subsidiaries, together with
appropriate evidence showing loss payable and/or additional insured
clauses or endorsements, as requested by the Administrative Agent, in
favor of the Administrative Agent, on behalf of Lenders;
(xix) Satisfactory review of all accounts and
inventory, in form and substance reasonably satisfactory to the
Administrative Agent; and
(xx) Control Agreements from (i) all securities
intermediaries with respect to all securities accounts and securities
entitlements of any Loan Party, and (ii) all
47
futures commission agents and clearing houses with respect to all
commodities contracts and commodities accounts held by any Loan Party,
to the extent that the aggregate balance in such accounts on the Closing
Date exceeds $2,500,000, in each case in form and substance reasonably
satisfactory to the Administrative Agent.
Section 3.2. Each Credit Event. The obligation of each Lender
to make a Loan on the occasion of any Borrowing and of the Issuing Bank to
issue, amend, renew or extend any Letter of Credit is subject to the
satisfaction of the following conditions:
(a) at the time of and immediately after giving effect to
such Borrowing or the issuance, amendment, renewal or extension of such Letter
of Credit, as applicable, no Default or Event of Default shall exist;
(b) all representations and warranties of each Loan Party
set forth in the Loan Documents shall be true and correct in all material
respects on and as of the date of such Borrowing or the date of issuance,
amendment, extension or renewal of such Letter of Credit, in each case before
and after giving effect thereto (except to the extent such representations and
warranties relate solely to an earlier date and except for changes therein
expressly permitted or expressly contemplated by the Loan Documents);
(c) since the date of the annual financial statements of the
Borrower described in Section 4.4, there shall have been no change which has had
or could reasonably be expected to have a Material Adverse Effect;
(d) after giving effect to such Borrowing or Letter of
Credit, the Revolving Credit Exposure will not exceed the Aggregate Revolving
Commitment Amount;
(e) the Borrower shall have delivered the required Notice of
Borrowing; and
(f) the Administrative Agent shall have received such other
documents, certificates or information as the Administrative Agent or the
Required Lenders may reasonably request, all in form and substance reasonably
satisfactory to the Administrative Agent or the Required Lenders.
Each Borrowing and each issuance, amendment, extension or
renewal of any Letter of Credit shall be deemed to constitute a representation
and warranty by the Borrower on the date thereof as to the matters specified in
paragraphs (a), (b), (c) and (d) of this Section 3.2.
Section 3.3. Delivery of Documents. All of the Loan
Documents, certificates, legal opinions and other documents and papers referred
to in this Article III, unless otherwise specified, shall be delivered to the
Administrative Agent for the account of each of the Lenders and, except for the
Notes, in sufficient counterparts or copies for each of the Lenders and shall be
in form and substance reasonably satisfactory in all respects to the
Administrative Agent.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Administrative Agent
and each Lender as follows:
Section 4.1. Corporate Existence; Compliance with Law; Name
History. Each of the Borrower and its Subsidiaries is a corporation or limited
liability company duly incorporated or organized (as applicable), validly
existing, and in good standing under the laws of the jurisdiction of its
incorporation or organization. Each of the Borrower and its Subsidiaries has all
requisite power (corporate and otherwise) to own and operate its properties and
to carry on its business as now being conducted, and, except where the failure
to do so could not reasonably be expected to have a Material Adverse Effect (i)
is duly qualified as a foreign corporation or limited liability company to do
business in every jurisdiction in which the nature of its business or the
ownership of its properties makes such qualification necessary and is in good
standing in such jurisdictions, and (ii) has all licenses and permits necessary
to carry on and conduct its business in all states and localities wherein it now
operates. Each of the Borrower and its Subsidiaries is, and for so long as this
Agreement remains in effect will remain, in compliance with all other
requirements of law, rule, or regulation applicable to it or to its business,
including without limitation any and all city, county, state, or federal legal
or regulatory requirements, requirements of any governmental protective
agencies, Federal Aviation Administration, Office of Safety and Health
Administration, Federal and State land sales statutes, regulations governing
Developments of Regional Impact (DRI's), any and all equal opportunity laws or
regulations, and any and all court or regulatory orders, or other legal,
judicial, or regulatory requirements applicable to it or its business, except in
each case where the failure to be in such compliance could not reasonably be
expected to have a Material Adverse Effect. As of the Closing Date, the Borrower
does not have any direct or indirect Subsidiaries, except for those described in
the Perfection Certificate. As of the Closing Date and except as set forth in
the Perfection Certificate, neither the Borrower nor any of its Subsidiaries has
merged, changed its name, or done business under a fictitious name during the
past five years.
Section 4.2. Corporate Power and Authorization to Execute
Loan Documents; No Conflict; No Consent. Each of the Borrower and the Subsidiary
Loan Parties has the corporate or other requisite power and authority to execute
and deliver the Loan Documents to be executed by it and to perform its
obligations thereunder and has taken all corporate or other requisite action
necessary to authorize the execution, delivery, and performance of such Loan
Documents and to authorize the transactions contemplated thereby. The execution,
delivery, and performance by each of the Borrower and each Subsidiary Loan Party
of the Loan Documents to be executed by it does not: (a) contravene, conflict
with, result in the breach of, or constitute a violation of or default under (i)
the certificate of incorporation or organization, bylaws, operating agreement or
other governing document of the Borrower or such Subsidiary Loan Party, (ii) any
applicable law, rule, regulation, judgment, order, writ, injunction, or decree
of any court or Governmental Authority or (iii) any indenture or any material
agreement or instrument to which the Borrower or any
49
Subsidiary Loan Party is a party or by which the Borrower or any Subsidiary Loan
Party or any of its property may be bound or affected; or (b) result in the
creation of any Lien upon any property or assets of the Borrower or any
Subsidiary Loan Party pursuant to any of the foregoing (except Liens created
under the Loan Documents). No consent, license, or authorization of, or filing
with, or notice to, any Person or entity (including, without limitation, any
Governmental Authority), is necessary or required in connection with the
execution, delivery, performance, validity, or enforceability of the Loan
Documents and the transactions as contemplated thereunder, except for (i)
consents, licenses, authorizations, filings, and notices which have already been
obtained or performed and of which Administrative Agent has been provided
written notice, or which are referred to or disclosed in the Loan Documents and
(ii) filings necessary to perfect Liens created under the Loan Documents. Any
consents, licenses, authorizations, filings, or notices which have been obtained
remain in full force and effect.
Section 4.3. Enforceable Obligations. The Loan Documents
constitute legal, valid, and binding agreements and obligations of the Borrower
and each Subsidiary Loan Party, enforceable against the Borrower and each
Subsidiary Loan Party in accordance with their respective terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
Section 4.4. Financial Condition.
(a) The consolidated financial statements (including the
notes thereto) as of the Fiscal Year ended October 31, 2002 and the Fiscal
Quarter ended January 31, 2003, of the Borrower and its Subsidiaries, copies of
which have been furnished to Administrative Agent and Lenders, are correct,
complete in all material respects, and fairly present, in all material respects,
the financial condition of the Borrower and its Subsidiaries as of the date of
the financial statements and present the results of the operations of the
Borrower and its Subsidiaries, taken as a whole, for the period covered thereby
in conformity with GAAP applied on a Consistent Basis, subject to non-material
changes resulting from normal, recurring year-end adjustments.
(b) The financial statements described above have been
prepared in accordance with GAAP applied on a Consistent Basis maintained
throughout the period involved.
(c) Since October 31, 2002, there have been no changes with
respect to the Borrower and its Subsidiaries which have had or could reasonably
be expected to have, singly or in the aggregate, a Material Adverse Effect.
(d) The Borrower and its Subsidiaries, when taken as a
whole, do not have any material direct or contingent liabilities, liabilities
for taxes, long-term leases, or unusual forward or long-term commitments as of
the date of this Agreement which are not disclosed by, provided for, or reserved
against in the foregoing financial statements or referred to in notes thereto,
and at the date of this Agreement there are no material unrealized or
anticipated losses of the Borrower and its Subsidiaries, when taken as a whole.
Section 4.5. No Litigation.
(a) Except as set forth in Schedule 4.5, there is no suit or
proceeding at law or in equity or other proceeding or investigation (including
proceedings by or before any court,
50
arbitrator, governmental or administrative commission, board, bureau, or other
administrative agency) pending, or to the knowledge of the Borrower threatened,
against the Borrower, against any of its Subsidiaries, or against any of its or
their properties, existence, or revenues (i) which, individually or in the
aggregate could reasonably be expected to be adversely determined, and if
adversely determined, could reasonably be expected to have a Material Adverse
Effect, or (ii) regardless of outcome, which would be required to be disclosed
in notes to any consolidated balance sheets as of the date hereof of the
Borrower and its Subsidiaries prepared in reasonable detail in accordance with
GAAP, or (iii) which in any manner draws into question the validity or
enforceability of this Agreement or any other Loan Document.
(b) Except as set forth in Schedule 4.5, neither the
Borrower nor any of its Subsidiaries (i) has failed to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or
other approval required under any Environmental Law, (ii) has become liable for
any Environmental Liability, (iii) has received notice of any claim asserting
that the Borrower or any of its Subsidiaries may be liable for any Environmental
Liability or (iv) knows of any basis for any Environmental Liability for which
the Borrower or any of its Subsidiaries could reasonably be expected to become
liable, in each case if the effect thereof could reasonably be expected to
result in a Material Adverse Effect.
Section 4.6. Investment Company Act; Regulation.
(a) Neither the Borrower nor any of its Subsidiaries is an
"investment company," an "affiliated person" of, or "promoter" or "principal
underwriter" for, any "investment company," or a company "controlled" by an
"investment company," and the neither the Borrower nor any of its Subsidiaries
is an "investment advisor" or an "affiliated person" of an "investment advisor"
(as each of the quoted terms is defined or used in the Investment Company Act of
1940, as amended). Neither the making of the Loans, nor the establishment of the
credits hereunder, nor the application of the proceeds or repayment thereof by
the Borrower, nor the consummation of the other transactions contemplated
hereby, will violate the provisions of the foregoing Act or any rule,
regulation, or order promulgated thereunder.
(b) Neither the Borrower nor any of its Subsidiaries is
subject to regulation under any state or local public utilities code or federal,
state, or local statute or regulation limiting the ability of the Borrower or
any Subsidiary to incur indebtedness for money borrowed.
Section 4.7. Disclosure and No Untrue Statements. No
representation or warranty or statement made by the Borrower or by any
Subsidiary Loan Party in the Loan Documents or in any schedule or exhibit
thereto, or in any certificate, report, statement, or other document or written
information furnished to the Administrative Agent in connection with or prior to
the Loan Documents (when taken as a whole and as modified or supplemented by
other written information so furnished), or which will be made or furnished by
the Borrower or any Subsidiary Loan Party from time to time in connection with
the Loan Documents, contains any misrepresentation or untrue statement of any
material fact or omits to state a material fact or any fact necessary to make
the statements contained herein or therein not materially misleading; provided
that, with respect to projected financial information, the Borrower represents
only that such information was prepared in good faith based upon assumptions
believed to be reasonable at the time. There is no fact known to the Borrower
which could reasonably be expected to have a
51
Material Adverse Effect, which has not been set forth or referred to in the Loan
Documents or otherwise disclosed in writing to Administrative Agent.
Section 4.8. Title to Assets; Leases in Good Standing. The
Borrower and each of its Subsidiaries has good and marketable title in fee to
such of its fixed assets as are real property and good and marketable title to
its other properties and assets, including the properties and assets reflected
in the financial statements and notes thereto described in Section 4.4, except
where the failure to have such title could not reasonably be expected to have a
Material Adverse Effect, and except for such assets as have been disposed of in
the ordinary course of business. All such properties and assets are free and
clear of all Liens, mortgages, pledges, security interests, charges, title
retention agreements, or other Liens of any kind, except those permitted under
Section 7.2, if any. Each of the Borrower and its Subsidiaries enjoys peaceful
and undisturbed possession under all leases, the termination of which could be
reasonably expected to have a Material Adverse Effect, and all such leases are
valid, subsisting, and in full force and effect and neither the Borrower nor any
Subsidiary is in violation of any material term of any such lease. The total
fair market value, in the aggregate, of all of the assets of the Borrower's
Subsidiary HEICO Aerospace Holdings Corp. is less than $1,000,000, and at all
times hereunder will be less than $1,000,000, in each case, excluding the value
of Capital Stock of its direct Subsidiaries, and except as permitted pursuant to
Section 7.11.
Section 4.9. Payment of Taxes. Each of the Borrower and, to
the extent required, its Subsidiaries, has filed or caused to be filed all
federal, state, and local tax returns which are required to be filed by it and
has paid or caused to be paid all taxes as shown on said returns or on any
assessment received by it, to the extent that such taxes have become due, other
than taxes being contested in good faith by appropriate proceedings diligently
conducted and for which adequate reserves have been established in accordance
with GAAP or except to the extent that the total liability for such taxes does
not exceed $1,000,000, and no controversy in respect of additional taxes of the
Borrower or its Subsidiaries which will have or is reasonably likely to have a
Material Adverse Effect, is pending, or, to the knowledge of the Borrower,
threatened.
Section 4.10. No Default Under Agreement or Instruments;
Compliance with Laws. Each of the Borrower and its Subsidiaries is in full
compliance with and is not in default in the performance, observance, or
fulfillment of any obligations, covenants, or conditions contained in any
agreement or instrument to which it is a party, except where such failure could
not reasonably be expected to have a Material Adverse Effect. The Borrower and
each Subsidiary is in compliance with all Requirements of Law and all judgments,
decrees and orders of any Governmental Authority, except where non-compliance,
either singly or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.
Section 4.11. Patents, Trademarks, Licenses, Etc. Each of the
Borrower and each of its Subsidiaries owns, possesses, or has the right to use,
and holds free from burdensome restrictions or known conflicts with the rights
of others, all patents, patent rights, licenses, Parts Manufacturing Approvals
(PMA's) issued by the Federal Aviation Administration, trademarks and service
marks, trademark and service mark rights, trade names, trade name rights, and
copyrights, and all rights with respect to the foregoing, necessary to conduct
its business as now conducted, and is in full compliance with the terms and
conditions, if any, of all such patents, patent rights, licenses, trademarks and
service marks, trademark and service mark rights, trade names, trade
52
name rights, or copyrights and the terms and conditions of any agreements
relating thereto, except where such failure could not reasonably be expected to
have a Material Adverse Effect.
Section 4.12. Government Contract. Neither the Borrower nor
any Subsidiary of the Borrower is subject to the renegotiation of any government
contract in any material amount, except where such renegotiations could not
reasonably be expected to have a Material Adverse Effect.
Section 4.13. ERISA Requirement. Except as previously
disclosed to Administrative Agent in writing, neither the Borrower nor any
Subsidiary has in force any pension plan subject to Title IV of ERISA. Neither
the Borrower nor any Subsidiary has ever terminated a pension plan subject to
Title IV of ERISA. In addition, neither the Borrower nor any predecessor of the
Borrower, nor any Subsidiary or any predecessor of such Subsidiary, is now or
was formerly during the five year period immediately preceding the effective
date of this Agreement a participating employer in any multi-employer plan
within the meaning of 001(1)(a)(3) of ERISA. Each employee benefit plan
maintained by the Borrower or any Subsidiary which is subject to the
requirements of ERISA substantially complies with all of the requirements of
ERISA, except to the extent that any such noncompliance would not result in a
liability to the Borrower or any Subsidiary in excess of $2,500,000, in the
aggregate, and those plans which are subject to being "qualified" under Sections
401(a) and 501(a) of the Internal Revenue Code of 1986, as amended from time to
time, have since their adoption been "qualified" and have received favorable
determination letters from the Internal Revenue Service so holding (or have
remaining a period of time under any Internal Revenue Service pronouncement in
which to apply for such determination letters). To the best knowledge of the
Borrower, there is no matter which could reasonably be expected to adversely and
materially affect the qualified tax exempt status of any such trust or plan, and
except as previously disclosed to Administrative Agent, there are no
deficiencies for any such plan or trust. To the best knowledge of the Borrower,
no employee benefit plan sponsored by the Borrower or any Subsidiary has engaged
in a non-exempt "prohibited transaction" as defined in ERISA.
Section 4.14. Solvency. The Borrower is, and on and after the
consummation of the transactions contemplated herein will be, Solvent. Each
Subsidiary of the Borrower is, and on and after the consummation of the
transactions contemplated herein will be, Solvent.
Section 4.15. Location of Offices. As of the Closing Date, the
Perfection Certificate contains a true and correct statement with respect to the
Borrower and each Subsidiary of its chief executive office and principal place
of business. As of the Closing Date, the chief executive office, the principal
place of business, and the office where all books and records of the Borrower
and each Subsidiary of the Borrower are kept is at the location described with
respect to the Borrower or such Subsidiary on the Perfection Certificate.
Section 4.16. Insurance. The properties of the Borrower and
its Subsidiaries are insured with financially sound and reputable insurance
companies which are not Affiliates of the Borrower, in such amounts with such
deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where
the Borrower or any applicable Subsidiary operates.
53
Section 4.17. Labor Relations. There are no strikes, lockouts
or other material labor disputes or grievances against the Borrower or any of
its Subsidiaries, or, to the Borrower's knowledge, threatened against or
affecting the Borrower or any of its Subsidiaries, and no significant unfair
labor practice, charges or grievances are pending against the Borrower or any of
its Subsidiaries, or to the Borrower's knowledge, threatened against any of them
before any Governmental Authority, except to the extent such proceedings could
not reasonably be expected to have a Material Adverse Effect. All payments due
from the Borrower or any of its Subsidiaries pursuant to the provisions of any
collective bargaining agreement have been paid or accrued as a liability on the
books of the Borrower or any such Subsidiary, except where the failure to do so
could not reasonably be expected to have a Material Adverse Effect.
ARTICLE V
AFFIRMATIVE COVENANTS
The Borrower covenants and agrees that so long as any Lender has
a Commitment hereunder, any Letter of Credit remains outstanding or any
Obligation remains unpaid or outstanding:
Section 5.1. Financial Reports and Other Information. The
Borrower will deliver or cause to be delivered to Administrative Agent the
following:
(a) As soon as practicable and in any event within
forty-five (45) days after the end of each of the first, second and third Fiscal
Quarters, then current financial statements of the Borrower and its Subsidiaries
for such Fiscal Quarter, including without limitation a balance sheet as of the
last day of such quarter, a statement of income for such quarter and cumulative
year-to-date, and related statement of cash flows for such Fiscal Quarter for
the Borrower and its Subsidiaries, all in reasonable detail and satisfactory in
scope to Required Lenders and certified by the chief financial officer of the
Borrower as to the fairness, completeness and accuracy in all material respects
of such financial statements and that the same have been prepared in accordance
with GAAP applied on a Consistent Basis, subject to changes resulting from
normal year-end adjustments;
(b) As soon as practicable and in any event within ninety
(90) days after the end of each Fiscal Year, the then current audited financial
statements of the Borrower and its Subsidiaries for such Fiscal Year, including
the balance sheet as of the end of such Fiscal Year, and related statements of
income, retained earnings, and cash flows for such Fiscal Year for the Borrower
and its Subsidiaries, setting forth in each case in comparative form figures for
the corresponding period in the preceding Fiscal Year, all in reasonable detail
and satisfactory in scope to Required Lenders and, with respect to consolidated
financial statements for the Borrower, certified by and containing an
unqualified opinion of Deloitte & Touche LLP, or other independent certified
public accountants of recognized national standing, which accountants shall be
selected by the Borrower and satisfactory to the Administrative Agent, and
certified by the chief financial officer of the Borrower as to the fairness,
completeness and accuracy in all material respects of such financial statements
and that the same have been prepared in accordance with GAAP applied on a
Consistent Basis;
54
(c) Together with delivery of the items required in clause
(b), a detailed report of the Borrower's projections of its revenues, expenses,
results of operations, cash flows and financial position for the next Fiscal
Year, in such degree of specificity as may be reasonably requested by
Administrative Agent, and including without limitation projected income
statements, balance sheets and cash flow statements for each quarter of the next
Fiscal Year for the Borrower and its Subsidiaries;
(d) Within thirty (30) days after receipt thereof, copies of
any management audit letters provided to the Borrower by the independent
certified public accountant who prepared Borrower's financial statements;
(e) As soon as practicable and in any event within
forty-five (45) days after the end of each Fiscal Quarter, a copy of any
quarterly 10-Q report or any other report filed by the Borrower with the United
States Securities and Exchange Commission during or for such quarter, if any;
(f) As soon as practicable and in any event within ninety
(90) days after the end of each Fiscal Year, a copy of the annual 10-K report
filed by the Borrower with the United States Securities and Exchange Commission
if any;
(g) Together with each delivery of the items required by
clauses (a) and (b) above, a Compliance Certificate executed by the principal
financial officer of the Borrower, (i) containing computations in reasonable
detail indicating compliance with Sections 6.1(a), (b) and (c) hereof, (ii)
certifying that the financial statements referred to in clauses (a) and (b) have
been filed with the United States Securities and Exchange Commission, the
certifications to the United States Securities and Exchange Commission required
under Sections 302(a) and 906(a) of the Sarbanes-Oxley Act of 2002, as amended,
have been made, and such certifications are true and correct, (iii) certifying
the matters contained in Sections 3.2 (a), (b) and (c) hereof as of such date
(or specifying all exceptions thereto and what actions the Borrower is taking or
proposes to take with respect thereto), (iv) stating whether any change in GAAP
or the application thereof has occurred since the date of the Borrower's audited
financial statements delivered in connection with Sections 4.4 or 5.1 hereto, as
applicable, and, if any change has occurred, specifying the effect of such
change on the financial statements accompanying such certificate and (v)
certifying that the financial statements fairly present the financial condition
of the Borrower and its Subsidiaries in all material respects; and
(h) With reasonable promptness, such additional financial or
other data relating to the Borrower or any of its Subsidiaries as Administrative
Agent may from time to time reasonably request.
Administrative Agent and the Lenders are hereby authorized to deliver
upon request a copy of any financial statements or any other information
relating to the business, properties, or financial condition of the Borrower or
any of its Subsidiaries which may be furnished to them or come to their
attention pursuant to the Loan Documents or otherwise, to any regulatory body or
agency having jurisdiction over Administrative Agent or the Lenders or to any
Person which shall, or shall have the right or obligation to, succeed to all or
any part of Administrative Agent's or the Lenders' interest in the Loan
Documents, subject to the provisions of Section 10.11 hereof.
55
Section 5.2. Payment of Indebtedness to Administrative Agent;
Payment of Other Obligations. (a) The Borrower will make full and timely payment
of the principal of and interest on the Indebtedness owed hereunder, subject to
the grace periods set forth in Section 8.1, if any; and (b) the Borrower will
make full and timely payment of all other sums to Administrative Agent, in its
capacity as such, whether now existing or hereafter arising, subject to any
applicable grace periods.
Section 5.3. Conduct of Business; Maintenance of Existence
and Rights. The Borrower and each of its Subsidiaries will do or cause to be
done all things necessary to preserve and to keep in full force and effect its
corporate existence and rights and privileges as a corporation and its material
franchises, licenses, trade names, patents, trademarks, and permits which are
necessary for the continuance of its business (provided that any Subsidiary may
merge with and into a Subsidiary Loan Party so long as the Subsidiary Loan Party
is the surviving entity).
Section 5.4. Maintenance of Property. The Borrower and each
of its Subsidiaries will maintain its property in good condition and repair in
all material respects and, from time to time, make all necessary and proper
repairs, renewals, replacements, additions, and improvements thereto, so that
the business carried on may be properly and advantageously conducted at all
times in accordance with prudent business management; provided, however, that
nothing contained herein shall prevent the Borrower or such Subsidiary from
selling or abandoning items of property in the ordinary course of business or as
otherwise specifically permitted herein or, with concurrent written notice to
Administrative Agent, from terminating, in the discretion of the officers or
directors of the Borrower or such Subsidiary, any joint venture or any
non-material operation.
Section 5.5. Right of Inspection; Discussions. The Borrower
and each of its Subsidiaries will permit any Person designated by Administrative
Agent or the Required Lenders to visit and inspect any of the properties,
corporate books, records, papers, and financial reports of the Borrower or such
Subsidiary, including the making of any copies thereof and abstracts therefrom,
and to discuss its affairs, finances, and accounts with its principal officers,
all at such reasonable times during normal business hours and with prior notice
and as often as Administrative Agent or the Required Lenders may reasonably
request. The Borrower and each of its Subsidiaries will also permit
Administrative Agent or the Required Lenders, or their designated
representatives, to audit or appraise, at Administrative Agent's or such
Required Lenders' expense, any of its assets or financial and business records,
provided that upon the occurrence and continuance of an Event of Default, such
audit or appraisal shall be at the Borrower's expense. Any designated
representative of Administrative Agent or Required Lenders shall agree to be
bound by the provisions of Section 10.11 hereof.
Section 5.6. Notices. The Borrower will reasonably promptly
(and in no case longer than one Business Day after a Responsible Officer of the
Borrower has knowledge thereof with respect to subsection (a) below, and in no
case longer than three Business Days after a Responsible Officer of the Borrower
has knowledge thereof in all other cases) give notice in writing to
Administrative Agent of:
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(a) the occurrence of any Event of Default (or event which
would constitute an Event of Default but for the requirement that notice be
given or time elapse or both) hereunder in which case such notice shall specify
the nature thereof, the period of existence thereof, and the action that the
Borrower proposes to take with respect thereto;
(b) the occurrence of any casualty to any facility of the
Borrower or any of its Subsidiaries or any other force majeure (including,
without limitation, any strike or other labor disturbance) affecting the
operation or value of any such facility, and whether or not such casualty or
force majeure is covered by insurance, which casualty, facility, or force
majeure could reasonably be expected to give rise to a Material Adverse Effect;
(c) the commencement or any material change in the nature or
status of any litigation, dispute, or proceeding, or the instituting of any
attachment, levy, execution, or other process by or against any assets of the
Borrower or any of its Subsidiaries, in each case or in the aggregate, which
could reasonably be expected to have a Material Adverse Effect;
(d) the occurrence of a change in, modification to,
cancellation or early termination of, or default in (or event which would
constitute a default but for the requirement that notice be given or time elapse
or both) any obligation, contract, or agreement of the Borrower or any of its
Subsidiaries with any other Person, in each case or in the aggregate, which
could reasonably be expected to give rise to a Material Adverse Effect;
(e) without the waiver or prior written consent of the
Administrative Agent in its sole and absolute discretion, any proposed
acquisition by the Borrower or any Subsidiary, which notice shall be given at
least five (5) days before the proposed closing of any such acquisition with a
total acquisition price of less than $15,000,000 or at least thirty (30) days
before the proposed closing of any such acquisition with a total acquisition
price of equal to or more than $15,000,000, or with an acquisition price which
when added to the total acquisition prices of all other acquisitions during any
four consecutive Fiscal Quarters of the Borrower in which the closing of such
transaction will occur will amount to an aggregate of $15,000,000 or more;
(f) without the waiver or prior written consent of the
Administrative Agent in its sole and absolute discretion, any proposed
incorporation or formation of any proposed or potential Subsidiary, which notice
shall be given at least five (5) days (or such lesser period as may be consented
to in writing by Administrative Agent) before such incorporation or formation;
(g) without the waiver or prior written consent of the
Administrative Agent in its sole and absolute discretion, any transaction listed
in Section 7.4 (not otherwise covered by clause (e) above), which notice shall
be given at least fifteen (15) days before such transaction is consummated;
(h) any assessment in an amount in excess of $1,000,000 by
any taxing authority for unpaid taxes which are due and payable;
(i) the occurrence of any event or any other development by
which the Borrower or any of its Subsidiaries (i) fails to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or
other approval required under any Environmental Law, (ii) becomes liable for any
Environmental Liability, (iii) receives notice of any claim
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asserting that the Borrower or any Subsidiary may be liable for any
Environmental Liability, or (iv) becomes aware of any basis for any
Environmental Liability for which the Borrower or any Subsidiary could
reasonably be expected to become liable, and in each of the preceding clauses,
which individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect;
(j) the receipt of any notice of termination of any real
property lease by the landlord after a default under such lease by the Borrower
or its Subsidiaries, as the case may be, if the Collateral located on such
leased property has a fair market value of $1,000,000 or more, which notice
shall be given within five (5) days of receipt thereof from the landlord; and
(k) any other development that results in, or could
reasonably be expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a written
statement of a Responsible Officer setting forth the details of the event or
development requiring such notice and any action taken or proposed to be taken
with respect thereto. Notwithstanding any contrary provision herein or in any
other Loan Document, the Administrative Agent may (but shall not be required to)
waive any notice requirement herein or in any other Loan Document.
Section 5.7. Payment of Taxes; Liens. The Borrower and each
of its Subsidiaries will pay or cause to be paid when due, subject to any
permitted extensions, all taxes, assessments, and other governmental charges
which may lawfully be levied or assessed (a) upon the income or profits of the
Borrower or such Subsidiary; (b) upon any property, real, personal or mixed,
belonging to the Borrower or such Subsidiary, or upon any part thereof; or (c)
by reason of employee benefit plans sponsored by the Borrower or such
Subsidiary, and will also pay or cause to be paid when due, subject to any
permitted extensions, any lawful claims for labor, material, or supplies which,
if unpaid, might become a lien or charge against any property of the Borrower or
such Subsidiary except to the extent that the failure to make such payments,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect; provided, however, the Borrower or such Subsidiary
shall not be required to pay any such tax, assessment, charge, levy, or claim
that is past due so long as the validity thereof shall be actively contested in
good faith by appropriate proceedings and the Borrower or such Subsidiary shall
have set aside on its books adequate reserves (determined in accordance with
GAAP) with respect to any such tax, assessment, charge, levy, or claim so
contested; but provided further that any such tax, assessment, charge, levy, or
claim shall be paid forthwith upon the commencement of proceedings to foreclose
any lien securing the same.
Section 5.8. Insurance of Properties. The Borrower and each
of its Subsidiaries will keep its business and properties insured at all times
by insurance companies selected by it and acceptable to Administrative Agent
against the risks for which provision for such insurance is usually made by
other Persons engaged in a similar business similarly situated (including
without limitation insurance for fire and other hazards, insurance against
vandalism and theft, liability on account of damage to persons or property,
business interruption, products liability, and insurance under all applicable
workman's compensation laws) and to the same extent thereto and carry such other
types and amounts of insurance as are usually carried by Persons engaged in the
same or a similar business similarly situated, subject to a standard
loss-payee's and
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additional insured's endorsement in favor of Administrative Agent for the
benefit of the Lenders (subject to any requirements in the Bond Documents with
respect to the collateral covered by the Bond Documents, to the extent
applicable), and upon request deliver to Administrative Agent a certificate from
the insurer setting forth the nature of the risks covered by such insurance, the
amount carried with respect to each risk, and the name of the insurer.
Section 5.9. True Books. The Borrower and each of its
Subsidiaries will keep proper and true books of record and account, satisfactory
to Administrative Agent, in which entries that are full, true, and correct in
all material respects will be made of all of its dealings and transactions
customarily recorded in the books of businesses of types substantially similar
to that of the Borrower or such Subsidiary, and establish on its books such
reserves as may be required by GAAP with respect to all taxes, assessments,
charges, levies, and claims referred to in Section 5.7 hereof, and with respect
to its business in general, and will, to the extent required by GAAP, include
such reserves in any interim as well as year-end financial statements.
Section 5.10. Observance of Laws. The Borrower and each of its
Subsidiaries will conform to and duly observe in all material respects, all
laws, regulations, and other valid requirements of any Governmental Authority
with respect to the conduct of its business, including without limitation all
laws, rules and regulations referenced in Section 4.1.
Section 5.11. Further Assurances. The Borrower will, and will
cause each of its Subsidiaries to, make, execute, endorse, acknowledge and
deliver any amendments, modifications or supplements to, and restatements of,
this Agreement and any other Loan Document, and any other agreements,
instruments or documents, and take any and all such actions, as may from time to
time be reasonably requested by the Administrative Agent to perfect and maintain
the validity and priority of the Liens granted pursuant to the Security
Documents and to effect, confirm or further assure or protect and reserve the
interests, rights and remedies of the Administrative Agent and the Lenders under
this Agreement and the other Loan Documents (including without limitation, any
and all instruments necessary or appropriate to affect the guarantee of the
Obligations by all Guarantors created or acquired after the date hereof).
Section 5.12. ERISA Benefit Plans. The Borrower and each of
its Subsidiaries will substantially comply with all requirements of ERISA
applicable to it, except to the extent that the failure to so comply shall not
result in a liability to the Borrower and its Subsidiaries in excess of
$2,500,000 in the aggregate. The Borrower and each of its Subsidiaries will
furnish to Administrative Agent as soon as possible and in any event within 10
days after the Borrower or such Subsidiary or a duly appointed administrator of
a plan (as defined in ERISA) knows or has reason to know that any reportable
event, funding deficiency, or prohibited transaction (as defined in ERISA) with
respect to any plan has occurred, a statement of the chief financial officer of
the Borrower describing in reasonable detail such reportable event, funding
deficiency, or prohibited transaction and any action which the Borrower or such
Subsidiary proposes to take with respect thereto, together with a copy of the
notice of such event given to the PBGC or the Internal Revenue Service or a
statement that said notice will be filed with the annual report of the United
States Department of Labor with respect to such plan if such filing has been
authorized.
Section 5.13. Withholding Taxes. Except to the extent that the
total liability of the Borrower and its Subsidiaries shall exceed $500,000 in
the aggregate, the Borrower and each
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of its Subsidiaries will pay, as and when due, subject to any permitted
extensions, all employee withholding, FICA, and other tax payments required by
federal, state, and local governments with respect to wages paid to employees;
provided, however, the Borrower or such Subsidiary shall not be required to pay
any such tax payment that is past due so long as the validity thereof shall be
actively contested in good faith by appropriate proceedings and the Borrower or
such Subsidiary shall have set aside on its books adequate reserves (determined
in accordance with GAAP) with respect to any such tax payment, so contested; but
provided further that any such tax, assessment, charge, levy, or claim shall be
paid forthwith upon the commencement of proceedings to foreclose any lien
securing the same.
Section 5.14. Change of Name, Principal Place of Business or
Office. The Borrower will notify Administrative Agent in writing of any change
in the name of the Borrower or any Subsidiary Loan Party, the principal place of
business of the Borrower or any Subsidiary Loan Party, or the office where the
books and records of the Borrower or any Subsidiary Loan Party, in each case
within ten (10) days before any such change made, unless waived by the
Administrative Agent in its sole and absolute discretion.
Section 5.15. Intentionally Omitted.
Section 5.16. Use of Proceeds and Letters of Credit
Affirmative Covenants. The Borrower will use the proceeds of all Loans as
provided in Section 2.7(d). No part of the proceeds of any Loan will be used,
whether directly or indirectly, for any purpose that would violate any rule or
regulation of the Board of Governors of the Federal Reserve System, including
Regulations T, U or X. All Letters of Credit will be used for general corporate
purposes.
Section 5.17. Additional Subsidiaries. Subject to the waiver
by the Administrative Agent of any of the notice requirements below in its sole
and absolute discretion, if any Domestic Subsidiary is acquired or formed after
the Closing Date, (x) the Borrower will, promptly and not later than ten (10)
Business Days thereafter, notify the Administrative Agent thereof and (y) within
fifteen (15) days thereafter, the Borrower shall cause such Person (i) to join
the Subsidiary Guaranty Agreement as a new Subsidiary Loan Party by executing
and delivering to the Administrative Agent a Subsidiary Guaranty Supplement
(provided, however, if such Domestic Subsidiary is non-wholly owned and
contractually prohibited from executing the Subsidiary Guaranty Supplement or
granting a Lien on its assets in favor of the Administrative Agent as required
hereunder, then any Investment in such non-wholly owned Domestic Subsidiary
shall continue to be subject to Section 7.4 hereof and no such Guarantee or
Liens shall be required), (ii) to grant Liens in favor of the Administrative
Agent in all of its personal property by joining the Security Agreement,
executing and delivering a Patent Security Agreement and Trademark Security
Agreement (as applicable) with respect to material intellectual property or as
requested by the Administrative Agent, and to file, or at the request of the
Administrative Agent to authorize the filing of, all such UCC financing
statements or similar instruments required by the Administrative Agent to
perfect Liens in favor of the Administrative Agent and granted under any of the
Loan Documents (subject to the proviso in clause (i) above), (iii) if such
Subsidiary owns Capital Stock in another Person, to become a party to a Pledge
Agreement to pledge such Capital Stock (subject to the proviso in clause (i)
above), provided, that if such Person is a Foreign Subsidiary, such pledge shall
not exceed 65% of the outstanding equity interests in such Person, and (iv) to
deliver all such other documentation (including without limitation, lien
searches, legal
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opinions, and certified organizational documents) and to take all such other
actions as such Domestic Subsidiary would have been required to deliver and,
subject to the proviso in clause (i) above, take pursuant to Section 3.1 if such
Domestic Subsidiary had been a Loan Party on the Closing Date. In addition,
subject to the proviso in clause (i) above, within fifteen (15) days after the
date such Person becomes a Domestic Subsidiary of the Borrower, the Borrower
shall, or shall cause its Subsidiary owning such Person, to pledge all of the
Capital Stock of such Person owned by the Borrower or such Subsidiary to the
Administrative Agent as security for the Obligations by executing and delivering
a supplement to the Pledge Agreement or a new pledge agreement reasonably
consistent with the Pledge Agreement, each in form and substance satisfactory to
the Administrative Agent, and to deliver the original certificates, if any,
evidencing such Capital Stock to the Administrative Agent, together with
appropriate stock powers executed in blank; provided, however, that if such
Domestic Subsidiary is non-wholly owned and the Loan Party which owns Capital
Stock in such Person is contractually prohibited from pledging such Capital
Stock in favor of the Administrative Agent as required hereunder, then any
Investment in such Domestic Subsidiary shall continue to be subject to Section
7.4 and no such pledge shall be required. The Borrower agrees that, following
the delivery of any Security Documents required to be executed and delivered by
this Section 5.17, the Administrative Agent shall have a valid and enforceable,
first priority perfected Lien on the property required to be pledged pursuant to
this Section 5.17, free and clear of all Liens other than Liens permitted under
Section 7.2. All actions to be taken pursuant to this Section 5.17 shall be at
the expense of the Borrower or the applicable Loan Party, and shall be taken to
the reasonable satisfaction of the Administrative Agent. In the event that a
proposed acquisition or investment by the Borrower or a Subsidiary is in
compliance with Section 7.4 and this Section 5.17, and the consent of the
Required Lenders would otherwise be required to effectuate such acquisition or
investment, then the Administrative Agent may, in its sole and absolute
discretion, if it determines that the item as to which such consent would
otherwise be required, is not material, waive such consent requirements.
Section 5.18. Additional Leased Locations. To the extent
otherwise permitted hereunder, if any Loan Party proposes to lease any Real
Estate, it shall first provide to the Administrative Agent a copy of such lease,
and if the total fair market value of all Collateral at such location shall at
any time exceed $2,000,000, or if the total of all Collateral at locations that
are not subject to a landlord's agreement shall at any time exceed $5,000,000,
then such Loan Party shall deliver a landlord's agreement, from the landlord of
such leased property where such Collateral will be stored or located, which
agreement shall be reasonably satisfactory in form and substance to the
Administrative Agent.
Section 5.19. Post-Closing Covenant.
(a) No later than 30 days after the Closing Date, the
Borrower shall use its best efforts to deliver to the Administrative Agent
landlord agreements with respect to the properties leased as of the date hereof,
duly executed and delivered by the respective landlords of the properties leased
by the Borrower or any of its Domestic Subsidiaries as reasonably requested by
the Administrative Agent, in form and substance reasonably satisfactory to the
Administrative Agent.
(b) Not later than 30 days after the Closing Date, the
Borrower shall deliver to the Administrative Agent, Blocked Account Agreements
for all depository accounts maintained by
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the Borrower and its Domestic Subsidiaries with the Lenders, in form and
substance reasonably satisfactory to the Administrative Agent.
ARTICLE VI
FINANCIAL COVENANTS
Section 6.1. Financial Covenants. The Borrower covenants and
agrees that so long as any Lender has a Commitment hereunder, any Letter of
Credit remains outstanding or any Obligation remains unpaid or outstanding, the
Borrower will at all times hereunder, in accordance with GAAP applied on a
Consistent Basis, maintain with respect to the Borrower and its Subsidiaries, on
a consolidated basis:
(a) A Leverage Ratio of not greater than 2.75 to 1.00, which
Leverage Ratio shall be maintained and reported as of the last day of each
Fiscal Quarter;
(b) A Fixed Charge Coverage Ratio of greater than or equal
to 2.75 to 1.00, which Fixed Charge Coverage Ratio shall be maintained and
reported as of the last day of each Fiscal Quarter; and
(c) A Consolidated Net Worth of the Borrower and its
Subsidiaries greater than or equal to the sum of (i) 85% of the Consolidated Net
Worth as of January 31, 2003, plus (ii) 75% of cumulative positive Consolidated
Net Income accrued since the Fiscal Quarter ending January 31, 2003, plus (iii)
100% of the Net Proceeds from any equity offering received by the Borrower,
calculated quarterly on the last day of each Fiscal Quarter, which Consolidated
Net Worth shall be maintained and reported as of the last day of each Fiscal
Quarter.
ARTICLE VII
NEGATIVE COVENANTS
The Borrower covenants and agrees that so long as any Lender has
a Commitment hereunder, any Letter of Credit remains outstanding or any
Obligation remains unpaid or outstanding:
Section 7.1. Other Indebtedness. The Borrower will not and
will not permit any of its Subsidiaries to, directly or indirectly, create,
incur, assume, or permit to exist any Indebtedness, except:
(a) Indebtedness under the Loan Documents and the Bond
Documents;
(b) Indebtedness existing on the date hereof and set forth
on Schedule 7.1 and extensions, renewals, modifications (provided that such
modifications are not adverse to the Lenders), refinancings and replacements of
any such Indebtedness that do not increase the
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outstanding principal amount thereof (immediately prior to giving effect to such
extension, renewal, modification, refinancing or replacement) or shorten the
maturity or the weighted average life thereof;
(c) obligations with respect to Capital Lease Obligations
incurred in the ordinary course of business to finance Capital Expenditures
(other than expenditures for equipment purchases or equipment leases permitted
under Section 7.1(d)), provided that such indebtedness shall be incurred within
180 days after the making of the Capital Expenditures financed thereby;
(d) Indebtedness incurred in the ordinary course of business
of the Borrower and its Subsidiaries in connection with the purchase of
equipment or vehicles, whether or not secured by purchase money security
interests therein; provided that the aggregate amount of all such Indebtedness,
when aggregated with all Indebtedness incurred under Section 7.1(f), does not
exceed $20,000,000 at any time outstanding;
(e) Permitted Real Estate Debt;
(f) any other unsecured Indebtedness for the Borrower and
all Subsidiaries on a consolidated basis; provided that the aggregate amount of
all such Indebtedness, when aggregated with all Indebtedness incurred under
Section 7.1(d), does not exceed $20,000,000 at any time outstanding; provided,
further that any Indebtedness in the form of Guarantees (excluding Guarantees of
the Obligations) shall be subject to the limitations set forth in Section 7.3
hereof;
(g) Indebtedness of the Borrower owing to any Subsidiary and
of any Subsidiary owing to the Borrower or any other Subsidiary; provided, that
any such Indebtedness that is owed to a Subsidiary that is not a Subsidiary Loan
Party shall be subject to Section 7.5; and
(h) Indebtedness of any Person which becomes a Subsidiary or
is otherwise acquired by the Borrower or its Subsidiaries (whether by merger,
consolidation or otherwise) after the date of this Agreement; provided, that (i)
such Indebtedness exists at the time that such Person becomes a Subsidiary (or
is otherwise acquired) and is not created in contemplation of or in connection
with such Person becoming a Subsidiary (or being otherwise acquired) and (ii)
the aggregate principal amount of such Indebtedness created, incurred or assumed
hereunder shall not exceed $30,000,000 during any trailing twelve-month period.
The Borrower will not, and will not permit any Subsidiary to, issue any
preferred stock or other preferred equity interests that (i) matures or is
mandatorily redeemable pursuant to a sinking fund obligation or otherwise, (ii)
is or may become redeemable or repurchaseable by the Borrower or such Subsidiary
at the option of the holder thereof, in whole or in part or (iii) is convertible
or exchangeable at the option of the holder thereof for Indebtedness or
preferred stock or any other preferred equity interests described in this
paragraph, on or prior to, in the case of clause (i), (ii) or (iii), the date
that is 91 days after the Maturity Date.
Section 7.2. Limitations on Mortgages, Liens, Etc. The
Borrower will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create, incur, assume, or suffer or permit to exist any Lien (but
excluding Liens, if any, evidenced by operating leases) upon or
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with respect to any of its assets, or assign or otherwise convey any right to
receive income, except the following:
(a) Capital Lease Obligations described in Section 7.1(c)
hereof;
(b) Permitted Encumbrances;
(c) purchase money security interests described in Section
7.1(d) hereof;
(d) Liens on assets acquired after the date hereof if such
Liens were in place at the time of acquisition, to the extent permitted pursuant
to Section 7.4;
(e) Liens securing Permitted Real Estate Debt;
(f) Liens set forth on Schedule 7.2;
(g) Liens with respect to Investments consisting of fully
collateralized repurchase agreements constituting Permitted Investments
permitted under Section 7.5;
(h) Liens not otherwise permitted by this Section 7.2 so
long as neither (i) the aggregate principal amount of the obligations secured
thereby nor (ii) the aggregate fair market value (determined, in the case of
each such Lien, as of the date such Lien is incurred) of the assets subject
thereto exceeds (as to the Borrower and all Subsidiaries) $200,000 at any one
time; provided that the Borrower shall discharge any such Lien within two (2)
Business Days after a Responsible Officer becomes aware thereof;
(i) Liens securing Indebtedness permitted pursuant to
Section 7.1(b) and Section 7.1(h) or created pursuant to the Bond Documents;
provided, that the principal amount of the Indebtedness secured thereby is not
increased and that any such Lien is limited to the assets originally encumbered
thereby; and
(j) Liens granted to the Borrower or HEICO Aerospace
Holdings Corp. securing loans to Parts Advantage, LLC permitted by Section
7.4(c)(iii).
Section 7.3. Guaranties. The Borrower will not, and will not
permit any of its Subsidiaries to, directly or indirectly, Guarantee, or
otherwise in any way extend credit or become responsible for or remain liable or
contingently liable in connection with any Indebtedness or other obligations of
any other Person or entity except to the extent only that the following do not
cause a violation of Section 6.1: (i) Guarantees and endorsements made in
connection with the deposit of negotiable instruments and other items for
collection or credit in the ordinary course of business and (ii) Guarantees by
the Borrower or any Subsidiary of debts incurred by suppliers of the Borrower or
its Subsidiaries or others having business relationships with the Borrower or
its Subsidiaries for business purposes of the Borrower or any Subsidiary and
(iii) Guarantees made in the ordinary course of business or to support
obligations incurred in the ordinary course of business or any acquisition or
other transaction permitted by Section 7.4 by the Borrower or any of its
Subsidiaries of obligations otherwise permitted to be incurred hereunder of the
Borrower or any Subsidiary; provided that Guarantees by any Loan Party of
Indebtedness of any Subsidiary that is not a Subsidiary Loan Party shall be
subject to Section 7.5.
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Section 7.4. Merger, Acquisition, Sale of Assets,
Dissolution, Etc. The Borrower will not, and will not permit any of its
Subsidiaries to, directly or indirectly:
(a) enter into any transaction of merger or consolidation
unless the Borrower is the surviving entity and no Default exists or would
result therefrom including, without limitation, violation of covenants contained
in Article 6 hereof, permit any Subsidiary to enter into any transaction of
merger or consolidation unless such Subsidiary is the surviving entity (or if a
Subsidiary is formed solely for the purpose of acquiring another Person, merge
with and into such other Person in connection with a merger or acquisition
completed in compliance with this Section and Section 5.17), or permit any
Subsidiary to enter into any transaction of merger or consolidation with another
Subsidiary unless the Subsidiary in which the Borrower holds the greater or
equal ultimate direct or indirect ownership interest therein is the surviving
corporation;
(b) enter into any one or more mergers, consolidations or
acquisitions having a total cash purchase price in excess of Thirty Million
Dollars ($30,000,000) in the aggregate in any trailing twelve-month period;
(c) (i) after the date hereof, except for Investments in HT
Parts, L.L.C. or Parts Advantage, LLC, make Investments of more than Five
Million Dollars ($5,000,000) in any joint venture, non-wholly-owned Subsidiary
or other equity alliance or equity contractual arrangement with another Person
or in any Person or entity having other shareholders, members, partners or
owners other than the Borrower or any Subsidiary, or make an aggregate of more
than Fifteen Million Dollars ($15,000,000) of such Investments during the period
from the Closing Date through and including the later to occur of (A) the
Revolving Credit Termination Date or (B) if the Term Loan Conversion Option is
exercised, the Maturity Date, without the Required Lenders' prior written
consent to such transaction, or (ii) make Investments of more than Five Million
Dollars ($5,000,000), in the aggregate, in HT Parts, L.L.C., or (iii) make
equity investments of more than Ten Million Dollars ($10,000,000), in the
aggregate, in Parts Advantage, LLC; or loans to Parts Advantage, LLC of more
than Five Million Dollars ($5,000,000) in the aggregate; provided, however, that
the foregoing limitations shall not apply to transactions executed pursuant to
the AFI Option Agreement.
(d) except to a wholly-owned Subsidiary Loan Party or as
otherwise specifically permitted herein, transfer, sell, assign, lease, or
otherwise dispose of all or a substantial part of its properties or assets or
any assets or properties necessary for the proper conduct of its business
(unless such properties constituting all or a substantial part of its properties
or assets or necessary for the proper conduct of its business have a total
aggregate fair market value of $1,000,000 or less in any Fiscal Year of the
Borrower, but excluding the disposition of the Aircraft Technology, Inc.
facility located at 3069 Taft Street, Hollywood, Florida), or any Capital Stock
of any Subsidiary, or permit any Subsidiary to issue any Capital Stock to any
Person other than the Borrower or a Subsidiary (except that, subject to the
provisions of this Agreement, a Subsidiary may issue its Capital Stock to a
Person other than the Borrower or other Subsidiaries in an equity offering or
private issuance to raise equity capital or establish a joint venture; provided
that at no time shall any Person other than the Borrower or its Subsidiaries or
Lufthansa Technik AG own more than 20% of the outstanding common stock nor more
than 20% of the voting control of any Subsidiary (other than HT Parts, L.L.C.),
and at no
65
time shall Lufthansa Technik AG own more than 30% of the outstanding common
stock nor more than 30% of the voting control of any Subsidiary);
(e) except to a wholly-owned Subsidiary Loan Party,
transfer, sell, assign, discount, lease, or otherwise dispose of any of its
notes or other instruments, accounts receivable, or contract rights with or
without recourse, except for collection in the ordinary course of business;
(f) change the scope or nature of its business except that
the Borrower may expand its business by internal growth or acquisitions, (A)
into any business substantially similar or related to the types of businesses it
or any Subsidiary currently conducts or (B) into other lines of business,
provided that revenues generated from such other lines of business shall not
constitute more than fifteen percent (15%) of the net sales of the Borrower and
its Subsidiaries, on a consolidated basis, during any Fiscal Quarter and
provided that such other businesses or lines of business singly or in the
aggregate could not reasonably be expected to have a Material Adverse Effect;
(g) wind up, liquidate, or dissolve itself or its business
(except that any Subsidiary may be liquidated into the Borrower or any other
wholly-owned Subsidiary Loan Party); or
(j) agree to any of the foregoing;
provided, however, nothing contained in this Section shall prohibit or otherwise
restrict the ability of a Subsidiary Loan Party to sell or otherwise transfer
its receivables or any other assets to another wholly-owned Subsidiary Loan
Party.
Section 7.5. Investments, Loans, etc. The Borrower will not,
and will not permit any Subsidiary to, purchase, hold or acquire (including
pursuant to any merger with any Person that was not a wholly-owned Subsidiary
prior to such merger), any common stock, evidence of indebtedness or other
securities (including any option, warrant, or other right to acquire any of the
foregoing) of, make or permit to exist any loans or advances to, Guarantee any
obligations of, or make or permit to exist any investment or any other interest
in, any other Person or purchase or otherwise acquire (in one transaction or a
series of transactions) any assets of any other Person (all of the foregoing
being collectively called "Investments"), except:
(a) Investments (other than Permitted Investments) existing
on the date hereof (including Investments in Subsidiaries) and set forth on
Schedule 7.5;
(b) Permitted Investments;
(c) mergers, acquisitions or other Investments made in
compliance with Section 7.4;
(d) Guarantees constituting Indebtedness permitted by
Section 7.3;
(e) loans, advances or equity investments made by the
Borrower to any Subsidiary or made to the Borrower or any other Subsidiary
(provided that any loan, advance or
66
equity investment made by a Loan Party to a Subsidiary that is not a Loan Party
shall be subject to the limitations in Section 7.4(c));
(f) Investments received in connection with a bankruptcy or
reorganization of, or settlement of delinquent accounts and disputes with,
customers and suppliers, in each case in the ordinary course of business;
(g) loans or advances to employees, officers or directors of
the Borrower or any Subsidiary in the ordinary course of business for travel,
relocation and related expenses; provided, however, that the aggregate
outstanding amount of all such loans and advances does not exceed $250,000 at
any time;
(h) Capital Expenditures permitted by Section 7.8;
(i) Investments by the Borrower or any of its Subsidiaries
in any Subsidiary Loan Party; and
(j) Hedging Transactions entered into in compliance with
Section 7.15.
Section 7.6. Federal Reserve Regulations. The Borrower
represents that neither it nor any of its Subsidiaries is engaged, and covenants
that neither it nor any of its Subsidiaries will become engaged, as one of its
principal or important activities in extending credit for the purpose of
purchasing or carrying margin stock. If requested by Administrative Agent, the
Borrower will furnish to Administrative Agent in connection with any Loan or
Loans hereunder, a statement in conformity with the requirements of Federal
Reserve Form U-1 or other forms referred to in said regulations. In addition,
the Borrower and each of its Subsidiaries covenants that no part of the proceeds
of any of the Loans hereunder will be used for the purchase of commodity future
contracts (or margins therefor for short sales) for any commodity not required
for the normal raw material inventory of the Borrower or such Subsidiary.
Section 7.7. Changes in Governing Documents, Accounting
Methods, Fiscal Year. The Borrower will not, or permit any Subsidiary to (a)
amend, in a manner materially adverse to the Lenders, its certificate of
incorporation or bylaws from that in existence on the date of this Agreement, or
(b) change in any material respect its accounting methods or practices or
depreciation or amortization policy or rates (except as provided in and pursuant
to the requirements of Section 1.3), except in each case as required to comply
with law or with GAAP (subject to the requirements of Section 1.3). The Borrower
shall give notice to Administrative Agent of any such amendment or change
permitted hereunder.
Section 7.8. Capital Expenditures. The Borrower will not
make or be committed to make, or permit any of its Subsidiaries to make or be
committed to make, any Capital Expenditure (excluding acquisitions of
businesses), by purchase or capitalized lease, other than Capital Expenditures
which would not cause the aggregate amount of all such Capital Expenditures,
when aggregated with all Sale and Leaseback Transactions without duplication,
calculated at the end of each Fiscal Quarter for the four consecutive Fiscal
Quarters then ended to exceed the aggregate amount of Fifteen Million Dollars
($15,000,000), unless the Required Lenders shall have given their prior written
consent to such amount of Capital Expenditures and Sale and Leaseback
Transactions as is in excess of $15,000,000 during such four quarter period.
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Section 7.9. Dividends, Etc. Without the prior written
consent of the Required Lenders, the Borrower will not declare or pay any cash
dividends in any Fiscal Year in an aggregate amount in excess of the greater of
(a) twenty percent (20%) of Consolidated Net Income (if greater than $0) for the
preceding Fiscal Year or (b) $0.05 per share of Capital Stock of the Borrower
per annum. Without the prior written consent of the Required Lenders, the
Borrower shall not (without duplication) (i) purchase, redeem, or otherwise
acquire for value any of its Capital Stock now or hereafter outstanding for an
aggregate amount of consideration in excess of $10,000,000 during any trailing
twelve-month period or in excess of $15,000,000, in the aggregate, during the
period from the Closing Date through and including the later to occur of (A) the
Revolving Credit Termination Date or (B) if the Term Loan Conversion Option is
exercised, the Maturity Date; (ii) return any capital to its stockholders as
such, or make any other payment or distribution of assets to its stockholders as
such; (iii) make any payment or prepayment of principal of, premium, if any, or
interest on, or redeem, defease or otherwise retire, any Indebtedness before its
scheduled due date, except for any required mandatory prepayments (other than by
acceleration upon default) under the Bond Documents or any other Indebtedness
secured by the Liens existing as of the date hereof and permitted pursuant to
Section 7.2 or (iv) permit any of its Subsidiaries to do any of the foregoing or
to purchase or otherwise acquire for value any stock of the Borrower or its
Subsidiaries except pursuant to the AFI Option Agreement, provided that nothing
herein shall prevent the Borrower from contributing proceeds of Loans to
Subsidiaries who are Subsidiary Loan Parties hereunder either in the form of
equity contributions (for issuance of additional shares of Subsidiary stock to
the Borrower or otherwise) or in the form of unsecured inter-company loans
subordinated to the Obligations and the Administrative Agent's Liens on the
Collateral. Notwithstanding the foregoing, upon the occurrence of an Event of
Default or an event which, with the giving of notice or the passage of time, or
both, would constitute an Event of Default, as well as during the continuance
thereof, the Borrower shall not, and shall not permit any Subsidiary to: (a)
redeem, retire, purchase or otherwise acquire, directly or indirectly, for value
or set apart any sum for the redemption, retirement, purchase or other
acquisition of, directly or indirectly, any shares of its common stock or
warrants or options to purchase any shares of its common stock; or (b) declare
any dividends or make any other distribution with respect to its stock (whether
by reduction of capital or otherwise), without Administrative Agent's prior
written consent. Nothing herein shall prevent or otherwise restrict (a) the
Borrower or any Subsidiary from declaring and paying dividends or other
distributions with respect to any class of its Capital Stock payable solely in
additional shares of such class of stock or (b) any Subsidiary from declaring
and paying cash dividends or inter-company receivables to its shareholders on a
pro rata basis.
Section 7.10. Intentionally Omitted.
Section 7.11. HEICO Aerospace Holdings Corp. Notwithstanding
anything else contained in this Agreement, the Borrower will not, and will not
permit any Subsidiary to, convey, transfer, assign, or otherwise deliver title
or ownership (whether by merger, consolidation, reorganization or otherwise) of
any assets or properties of any kind to HEICO Aerospace Holdings Corp. and will
not permit HEICO Aerospace Holdings Corp. to acquire (whether by purchase,
conveyance, transfer, assignment, merger, consolidation, acquisition, or any
other means) or to hold any assets or property with a fair market value greater
than $1,000,000 in the aggregate (other than the Capital Stock of the direct
Subsidiaries of HEICO Aerospace Holdings Corp.) at any time hereunder until the
sooner to occur of the following: (i) Administrative Agent for the
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benefit of the Lenders receives from Lufthansa Technik AG a written waiver,
release and consent, in form and substance satisfactory to the Administrative
Agent, waiving, releasing and terminating the provision contained in Article 18
of that certain Shareholders Agreement dated as of October 30, 1997 by and among
HEICO Aerospace Holdings Corp., HEICO Aerospace Corporation, and all of the
shareholders of HEICO Aerospace Holdings Corp., including Lufthansa Technik AG,
and any similar contractual provisions or (ii) Lufthansa Technik AG ceases to be
a shareholder of HEICO Aerospace Holdings Corp. and the foregoing Shareholders
Agreement and all similar contractual provisions have been terminated and
released pursuant to documentation in form and substance satisfactory to the
Administrative Agent. Notwithstanding this Section 7.11 or Section 7.9, the
direct Subsidiaries of HEICO Aerospace Holdings Corp. may (i) declare and pay
cash dividends to HEICO Aerospace Holdings Corp., provided and only to the
extent that HEICO Aerospace Holdings Corp. shall have declared dividends to its
common stockholders in the same amount and shall immediately pay such cash
dividends to the common stockholders of HEICO Aerospace Holding Corp. within one
(1) day of the time such dividends are received by HEICO Aerospace Holdings
Corp., such that no cash remains in HEICO Aerospace Holdings Corp. for longer
than one (1) day and (ii) no more frequently than quarterly, may fund any
payment of taxes required to be made directly by HEICO Aerospace Holdings Corp.,
provided that the Borrower shall cause HEICO Aerospace Holdings Corp. to pay
such taxes immediately upon receipt of any such funds, such that no cash remains
in HEICO Aerospace Holdings Corp. for longer than one (1) day. Notwithstanding
this Section 7.11, upon obtaining the prior written consent of the
Administrative Agent in each case on a case by case basis, which consent shall
not be unreasonably withheld, the Borrower or any Subsidiary Loan Party that is
a direct or indirect Subsidiary of HEICO Aerospace Holdings Corp. (i) may, on
the closing date of any acquisition permitted hereunder and made by HEICO
Aerospace Holdings Corp., fund through HEICO Aerospace Holdings Corp. the cash
portion of the acquisition purchase price to be paid at the closing of such
acquisition, provided that the Borrower shall cause HEICO Aerospace Holdings
Corp. to pay such cash acquisition price immediately upon receipt of any such
funds, such that no such cash shall remain in HEICO Aerospace Holdings Corp. for
longer than twenty-four (24) hours.
Section 7.12. Transactions with Affiliates. The Borrower will
not, and will not permit any of its Subsidiaries to, sell, lease or otherwise
transfer any property or assets to, or purchase, lease or otherwise acquire any
property or assets from, or otherwise engage in any other transactions with, any
of its Affiliates, except (a) in the ordinary course of business at prices and
on terms and conditions not less favorable to the Borrower or such Subsidiary
than could be obtained on an arm's-length basis from unrelated third parties
(provided that the foregoing restriction shall not apply to employment
agreements with Affiliates approved in good faith by the Board of Directors of
the Borrower or any compensation or similar committee of the Board of
Directors), (b) transactions between or among the Borrower and any Subsidiary
Loan Party not involving any other Affiliates, (c) any payment permitted by
Section 7.9, (d) customary fees paid to members of the Board of Directors of the
Borrower and its Subsidiaries for their services as directors not in excess of
fees paid to directors who are not Affiliates of the Borrower or any Subsidiary
and (e) transactions with HT Parts, L.L.C., Parts Advantage, LLC or any other
entity that the Borrower or its Subsidiaries has invested in pursuant to Section
7.4(c), in each case, entered into in good faith and in the best interests of
the Borrower.
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Section 7.13. Restrictive Agreements. The Borrower will not,
and will not permit any Subsidiary to, directly or indirectly, enter into, incur
or permit to exist any agreement that prohibits, restricts or imposes any
condition upon (a) the ability of the Borrower or any Subsidiary to create,
incur or permit any Lien upon any of its assets or properties, whether now owned
or hereafter acquired, or (b) the ability of any Subsidiary to pay dividends or
other distributions with respect to its common stock, to make or repay loans or
advances to the Borrower or any other Subsidiary, to guarantee Indebtedness of
the Borrower or any other Subsidiary or to transfer any of its property or
assets to the Borrower or any Subsidiary of the Borrower; provided, that (i) the
foregoing shall not apply to restrictions or conditions imposed (x) by law, (y)
by this Agreement or any other Loan Document, or (z) the Bond Documents,
existing operating agreements or shareholders' agreements in respect of
non-wholly owned entities (in the case of this clause (z), each as in effect on
the date hereof), (ii) the foregoing shall not apply to customary restrictions
and conditions contained in agreements relating to the sale of a Subsidiary
pending such sale, provided such restrictions and conditions apply only to the
Subsidiary that is sold and such sale is permitted hereunder, (iii) clause (a)
shall not apply to restrictions or conditions imposed by any agreement relating
to secured Indebtedness permitted by this Agreement if such restrictions and
conditions apply only to the property or assets securing such Indebtedness, (iv)
clause (a) shall not apply to customary provisions in leases restricting the
assignment thereof and (v) this Section 7.13 shall not apply to agreements
relating to Investments in joint ventures, equity investments or non-wholly
owned Subsidiaries made in compliance with Section 7.4(c).
Section 7.14. Sale and Leaseback Transactions. Except as
permitted under Section 7.1(c), the Borrower will not, and will not permit any
of the Subsidiaries to, enter into any arrangement, directly or indirectly,
whereby it shall sell or transfer any property, real or personal, used or useful
in its business, whether now owned or hereinafter acquired, and thereafter rent
or lease such property or other property that it intends to use for
substantially the same purpose or purposes as the property sold or transferred
("Sale and Lease Back Transactions"), provided, however, the aggregate amount of
all Sale and Leaseback Transactions shall not exceed $10,000,000 during any four
consecutive Fiscal Quarters, or $20,000,000 during the term of this Agreement.
Section 7.15. Hedging Transactions. The Borrower will not, and
will not permit any of the Subsidiaries to, enter into any Hedging Transaction,
other than Hedging Transactions entered into in the ordinary course of business
to hedge or mitigate risks to which the Borrower or any Subsidiary is exposed in
the conduct of its business or the management of its liabilities. Solely for the
avoidance of doubt, the Borrower acknowledges that a Hedging Transaction entered
into for speculative purposes or of a speculative nature (which shall be deemed
to include any Hedging Transaction under which the Borrower or any of the
Subsidiaries is or may become obliged to make any payment (i) in connection with
the purchase by any third party of any common stock or any Indebtedness or (ii)
as a result of changes in the market value of any common stock or any
Indebtedness) is not a Hedging Transaction entered into in the ordinary course
of business to hedge or mitigate risks.
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ARTICLE VIII
EVENTS OF DEFAULT
Section 8.1. Events of Default. If any of the following
events (each an "Event of Default") shall occur:
(a) The Borrower fails to make payment of Obligations owed
to Administrative Agent or any Lenders under the Loan Documents when due and
payable, or fails to make any other payment to Administrative Agent or Lenders
as contemplated thereunder either by the terms hereof or otherwise, and, in the
case of interest, fees or other amounts (other than principal of any Loan), such
failure continues for three Business Days after such interest, fee or other
amount is due.
(b) Any representation or warranty made, or deemed to be
made pursuant to Section 3.2 hereof, made by the Borrower or any of its
Subsidiaries or any executive officer of the Borrower or any of its Subsidiaries
in this Agreement, in any of the Loan Documents, or in any writing furnished in
connection with or pursuant to the Loan Documents, or any report, certificate,
financial statement, or other written information provided by the Borrower or
any of its Subsidiaries or any executive officer of the Borrower or any of its
Subsidiaries to Administrative Agent or a Lender in connection with or pursuant
to the Loan Documents, shall be false or misleading in any material respect on
the date when made or when deemed made.
(c) The Borrower or any of its Subsidiaries shall fail to
observe or perform any covenant or agreement contained in Section 5.3 (with
respect to the Borrower's existence), Section 5.6(a) or Articles VI or VII.
(d) The Borrower or any of its Subsidiaries fails to fully
and promptly perform when due any agreement, covenant, term, or condition
binding on it, other than as described in clauses (a), (b) and (c) above,
contained in this Agreement or any other Loan Document, or otherwise a part of
the transactions covered hereby, if such failure continues for thirty (30) days
after written notice thereof has been provided to the Borrower by Administrative
Agent or the Required Lenders.
(e) The Borrower or any Subsidiary (whether as primary
obligor or as guarantor or other surety) shall fail to pay any principal of, or
premium or interest on, any Indebtedness (other than the Indebtedness evidenced
by the Loan Documents) that has an outstanding principal amount, notional
amount, or total amount of Indebtedness in excess of $5,000,000, when and as the
same shall become due and payable (whether at scheduled maturity, required
prepayment, acceleration, demand or otherwise), and such failure shall continue
after the applicable grace period, if any, specified in the agreement or
instrument evidencing or governing such Indebtedness; or any other event shall
occur or condition shall exist under any agreement or instrument relating to
such Indebtedness and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event or
condition is to accelerate, or permit the acceleration of, the maturity of such
Indebtedness; or any such Indebtedness shall be declared to be due and payable,
or required to be prepaid or redeemed (other than by a regularly scheduled
required prepayment or redemption), purchased or
71
defeased, or any offer to prepay, redeem, purchase or defease such Indebtedness
shall be required to be made, in each case prior to the stated maturity thereof.
(f) The Borrower or any Subsidiary liquidates or dissolves
(except as expressly permitted under the Loan Documents); the Borrower or any
Subsidiary files or commences a voluntary petition, case, proceeding, or other
action seeking reorganization, arrangement, readjustment of its debts, or any
other relief under any existing or future law of any jurisdiction, domestic or
foreign, state or federal, relating to bankruptcy, insolvency, reorganization,
or relief of debtors, or the Borrower or any Subsidiary takes any other action
indicating its consent to, approval of, or acquiescence in, any such petition,
case, proceeding, or other action seeking to have an order for relief entered
with respect to it or its debts; the Borrower or any Subsidiary applies for, or
consents to or acquiesces in, the appointment of a receiver, trustee, custodian,
or other similar official for the Borrower or any Subsidiary or for all or a
substantial part of its property; the Borrower or any Subsidiary makes an
assignment for the benefit of creditors; or the Borrower or any Subsidiary is
unable to pay its debts as they mature or admits in writing its inability to pay
its debts as they mature.
(g) An involuntary petition, case, proceeding, or other
action is commenced against the Borrower or any Subsidiary under the Bankruptcy
Code or seeking reorganization, arrangement, readjustment of its debts, or any
other relief under any existing or future law of any jurisdiction, domestic or
foreign, state or federal, relating to bankruptcy, insolvency, reorganization,
or relief of debtors; a receiver, trustee, custodian, or other similar official
is involuntarily appointed for the Borrower or any Subsidiary or for all or a
substantial part of the Borrower's or such Subsidiary's property or assets; or
any case, proceeding, or other action seeking issuance of a warrant of
attachment, execution, distraint, or similar process against all or a
substantial part of the Borrower's or such Subsidiary's assets or property
results in the entry of an order for such relief; and any of the foregoing
continues for sixty (60) days without being vacated, discharged, stayed, bonded,
or dismissed.
(h) The occurrence of any Change in Control.
(i) A judgment is entered against the Borrower or any
Subsidiary for the payment of damages or money in excess of Five Million Dollars
($5,000,000) (not paid or fully covered by insurance, provided that the
insurance carrier has acknowledged coverage in form and substance acceptable to
the Administrative Agent) or otherwise having a Material Adverse Effect, if the
same is not discharged or if a writ of execution or similar process is issued
with respect thereto and is not bonded or stayed within thirty (30) days.
(j) A writ of attachment or garnishment is issued against,
or a lien is imposed by operation of law on, any property of the Borrower or any
Subsidiary, and the lesser of the amount of the claim or the value of the
affected property is in excess of $2,500,000, if the lien is not discharged
within sixty (60) days after it has attached (not counting for this purpose any
period for so long as enforcement thereof is stayed and bonded during appeal
with adequate reserves provided therefor pursuant to GAAP).
(k) Any act or omission (formal or informal) of the Borrower
or any Subsidiary Loan Party, or its officers, directors, or shareholders
leading to, or resulting in, the
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termination, invalidation (partial or total), revocation, suspension,
interruption, or unenforceability of its corporate existence, rights, licenses,
franchises, or permits, which act or omission will have a Material Adverse
Effect, or the transfer or disposition (whether by sale, lease, or otherwise) to
any Person of all or a substantial part of its property (except as specifically
permitted pursuant to Section 7.4(d) or otherwise in any Loan Document).
(l) An ERISA Event shall have occurred that, in the opinion
of the Required Lenders, when taken together with other ERISA Events that have
occurred, could reasonably be expected to result in liability to the Borrower
and the Subsidiaries in an aggregate amount exceeding $2,500,000.
(m) An Event of Default under any other Loan Document shall
occur.
(n) any material provision of the Subsidiary Guaranty
Agreement or any Security Document shall for any reason cease to be valid and
binding on, or enforceable against, any Subsidiary Loan Party, or any Subsidiary
Loan Party shall so state in writing, or any Subsidiary Loan Party shall seek to
terminate its Subsidiary Guaranty Agreement.
then, and in every such event (other than an event with respect to the Borrower
described in clause (f) or (g) of this Section) and at any time thereafter
during the continuance of such event, the Administrative Agent may, and upon the
written request of the Required Lenders shall, by notice to the Borrower, take
any or all of the following actions, at the same or different times: (i)
terminate the Commitments, whereupon the Commitment of each Lender shall
terminate immediately, (ii) declare the principal of and any accrued interest on
the Loans, and all other Obligations owing hereunder, to be, whereupon the same
shall become, due and payable immediately, without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Borrower,
(iii) exercise all remedies contained in any other Loan Document, and (iv)
exercise any other remedies available at law or in equity; and that, if an Event
of Default specified in either clause (f) or (g) with respect to the Borrower
shall occur, the Commitments shall automatically terminate and the principal of
the Loans then outstanding, together with accrued interest thereon, and all
fees, and all other Obligations shall automatically become due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Borrower.
Section 8.2. Application of Proceeds from Collateral.
Notwithstanding any other provisions of this Agreement, after the occurrence and
during the continuance of an Event of Default, all amounts collected or received
(including by way of set-off) by the Administrative Agent or any Lender on
account of amounts outstanding under any of the Loan Documents or in respect of
the Collateral shall be paid over or delivered as follows: first, to the fees,
indemnities and reimbursable expenses of the Administrative Agent, the Swingline
Lender and the Issuing Bank then due and payable pursuant to any of the Credit
Documents, until the same shall have been paid in full, allocated pro rata in
accordance with the respective unpaid fees, indemnities and expenses; second, to
the reimbursable expenses, if any, of the Lenders then due and payable pursuant
to any of the Credit Documents, until the same shall have been paid in full,
allocated pro rata among the Lenders based
73
on their respective pro rata shares of the unpaid expenses; third, to accrued
and unpaid interest and fees due and payable to the Lenders under the terms of
this Agreement, until the same shall have been paid in full, allocated pro rata
among the Lenders based on their respective pro rata shares of such unpaid
interest and fees; fourth, to the aggregate outstanding principal amount of the
Loans, the LC Exposure and the Net Mark-to-Market Exposure of Hedging
Obligations incurred in connection with this Agreement, until the same shall
have been paid in full, allocated pro rata among the Lenders and those
Affiliates of Lenders that hold Net Mark-to-Market Exposure based on their
respective pro rata shares of the aggregate amount of such Loans, LC Exposure
and Net Mark-to-Market Exposure; provided, however, that all amounts allocated
to the contingent LC Exposure pursuant to clause fourth shall be distributed to
the Administrative Agent, rather than to any Lenders, and held by the
Administrative Agent in an account in the name of the Administrative Agent for
the benefit of the Issuing Bank and the Lenders as cash collateral for such
contingent LC Exposure, such account to be administered in accordance with
Section 2.23(g). Notwithstanding anything to the contrary contained herein or in
any other Loan Document, the net proceeds realized by the Administrative Agent
upon a sale or other disposition of the Collateral of HEICO Aerospace Holdings
Corp., or any part thereof, after deduction of the expenses of retaking,
holding, preparing for sale, selling or the like, and reasonable attorneys' fees
and other expenses incurred by the Administrative Agent shall be applied to
payment of (or held as a reserve against) the Obligations, whether or not then
due, and in such order of application as provided herein, notwithstanding the
existence of any other security interests in the Collateral, subject to the
provisions of Article 18 of that certain Shareholders Agreement dated as of
October 30, 1997 by and among HEICO Aerospace Holdings Corp., the Borrower and
Lufthansa Technik AG, as in effect on the date hereof, or as otherwise amended
from time to time in a manner that is not adverse to the interests of the
Lenders and the Administrative Agent, if applicable and to the extent legally
enforceable, and the Administrative Agent shall account to HEICO Aerospace
Holdings Corp. for any surplus realized upon such sale or other disposition,
after satisfaction of all creditors, and HEICO Aerospace Holdings Corp. shall
remain liable for any deficiency.
ARTICLE IX
THE ADMINISTRATIVE AGENT
Section 9.1. Appointment of Administrative Agent.
(a) Each Lender irrevocably appoints SunTrust Bank as the
Administrative Agent and authorizes it to take such actions on its behalf and to
exercise such powers as are delegated to the Administrative Agent under this
Agreement and the other Loan Documents, together with all such actions and
powers that are reasonably incidental thereto. The Administrative Agent may
perform any of its duties hereunder or under the other Loan Documents by or
through any one or more sub-agents or attorneys-in-fact appointed by the
Administrative Agent. The Administrative Agent and any such sub-agent or
attorney-in-fact may perform any and all of its duties and exercise its rights
and powers through their respective Related Parties. The exculpatory provisions
set forth in this Article shall apply to any such sub-agent or attorney-in-fact
and the Related Parties of the Administrative Agent, any such sub-agent and any
such attorney-in-fact and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities as Administrative Agent.
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(b) The Issuing Bank shall act on behalf of the Lenders with
respect to any Letters of Credit issued by it and the documents associated
therewith until such time and except for so long as the Administrative Agent may
agree at the request of the Required Lenders to act for the Issuing Bank with
respect thereto; provided, that the Issuing Bank shall have all the benefits and
immunities (i) provided to the Administrative Agent in this Article IX with
respect to any acts taken or omissions suffered by the Issuing Bank in
connection with Letters of Credit issued by it or proposed to be issued by it
and the application and agreements for letters of credit pertaining to the
Letters of Credit as fully as if the term "Administrative Agent" as used in this
Article IX included the Issuing Bank with respect to such acts or omissions and
(ii) as additionally provided in this Agreement with respect to the Issuing
Bank.
Section 9.2. Nature of Duties of Administrative Agent. The
Administrative Agent shall not have any duties or obligations except those
expressly set forth in this Agreement and the other Loan Documents. Without
limiting the generality of the foregoing, (a) the Administrative Agent shall not
be subject to any fiduciary or other implied duties, regardless of whether a
Default or an Event of Default has occurred and is continuing, (b) the
Administrative Agent shall not have any duty to take any discretionary action or
exercise any discretionary powers, except those discretionary rights and powers
expressly contemplated by the Loan Documents that the Administrative Agent is
required to exercise in writing by the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 10.2), and (c) except as expressly set forth in the Loan
Documents, the Administrative Agent shall not have any duty to disclose, and
shall not be liable for the failure to disclose, any information relating to the
Borrower or any of its Subsidiaries that is communicated to or obtained by the
Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall not be liable for any action taken or not taken by
it, its sub-agents or attorneys-in-fact with the consent or at the request of
the Required Lenders (or such other number or percentage of the Lenders as shall
be necessary under the circumstances as provided in Section 10.2) or in the
absence of its own gross negligence or willful misconduct. The Administrative
Agent shall not be responsible for the negligence or misconduct of any
sub-agents or attorneys-in-fact. The Administrative Agent shall not be deemed to
have knowledge of any Default or Event of Default (except a payment Default)
unless and until written notice thereof (which notice shall include an express
reference to such event being a "Default" or "Event of Default" hereunder) is
given to the Administrative Agent by the Borrower or any Lender, and the
Administrative Agent shall not be responsible for or have any duty to ascertain
or inquire into (i) any statement, warranty or representation made in or in
connection with any Loan Document, (ii) the contents of any certificate, report
or other document delivered hereunder or thereunder or in connection herewith or
therewith, (iii) the performance or observance of any of the covenants,
agreements, or other terms and conditions set forth in any Loan Document, (iv)
the validity, enforceability, effectiveness or genuineness of any Loan Document
or any other agreement, instrument or document, or (v) the satisfaction of any
condition set forth in Article III or elsewhere in any Loan Document, other than
to confirm receipt of items expressly required to be delivered to the
Administrative Agent. The Administrative Agent may consult with legal counsel
(including counsel for the Borrower) concerning all matters pertaining to such
duties.
Section 9.3. Lack of Reliance on the Administrative Agent.
Each of the Lenders, the Swingline Lender and the Issuing Bank acknowledges that
it has, independently and without reliance upon the Administrative Agent or any
other Lender and based on such documents
75
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each of the Lenders, the Swingline Lender
and the Issuing Bank also acknowledges that it will, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it has deemed appropriate, continue to make its own
decisions in taking or not taking of any action under or based on this
Agreement, any related agreement or any document furnished hereunder or
thereunder.
Section 9.4. Certain Rights of the Administrative Agent. If
the Administrative Agent shall request instructions from the Required Lenders
with respect to any action or actions (including the failure to act) in
connection with this Agreement, the Administrative Agent shall be entitled to
refrain from such act or taking such act, unless and until it shall have
received instructions from such Lenders; and the Administrative Agent shall not
incur liability to any Person by reason of so refraining. Without limiting the
foregoing, no Lender shall have any right of action whatsoever against the
Administrative Agent as a result of the Administrative Agent acting or
refraining from acting hereunder in accordance with the instructions of the
Required Lenders where required by the terms of this Agreement.
Section 9.5. Reliance by Administrative Agent. The
Administrative Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed, sent or made by the proper Person. The Administrative
Agent may also rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person and shall not incur any liability
for relying thereon. The Administrative Agent may consult with legal counsel
(including counsel for the Borrower), independent public accountants and other
experts selected by it and shall not be liable for any action taken or not taken
by it in accordance with the advice of such counsel, accountants or experts.
Section 9.6. The Administrative Agent in its Individual
Capacity. The bank serving as the Administrative Agent shall have the same
rights and powers under this Agreement and any other Loan Document in its
capacity as a Lender as any other Lender and may exercise or refrain from
exercising the same as though it were not the Administrative Agent; and the
terms "Lenders", "Required Lenders", "holders of Notes", or any similar terms
shall, unless the context clearly otherwise indicates, include the
Administrative Agent in its individual capacity. The bank acting as the
Administrative Agent and its Affiliates may accept deposits from, lend money to,
and generally engage in any kind of business with the Borrower or any Subsidiary
or Affiliate of the Borrower as if it were not the Administrative Agent
hereunder.
Section 9.7. Successor Administrative Agent.
(a) The Administrative Agent may resign at any time by
giving notice thereof to the Lenders and the Borrower. Upon any such
resignation, the Required Lenders shall have the right to appoint a successor
Administrative Agent, subject to the approval by the Borrower provided that no
Default or Event of Default shall exist at such time. If no successor
Administrative Agent shall have been so appointed, and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives notice
of resignation, then the retiring Administrative Agent may, on behalf of the
Lenders and the Issuing Bank, appoint a successor Administrative Agent, which
shall be a commercial bank organized under the laws of
76
the United States of America or any state thereof or a bank which maintains an
office in the United States, having a combined capital and surplus of at least
$500,000,000.
(b) Upon the acceptance of its appointment as the
Administrative Agent hereunder by a successor, such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under
this Agreement and the other Loan Documents. If within 45 days after written
notice is given of the retiring Administrative Agent's resignation under this
Section 9.7 no successor Administrative Agent shall have been appointed and
shall have accepted such appointment, then on such 45th day (i) the retiring
Administrative Agent's resignation shall become effective, (ii) the retiring
Administrative Agent shall thereupon be discharged from its duties and
obligations under the Loan Documents and (iii) the Required Lenders shall
thereafter perform all duties of the retiring Administrative Agent under the
Loan Documents until such time as the Required Lenders appoint a successor
Administrative Agent as provided above. After any retiring Administrative
Agent's resignation hereunder, the provisions of this Article IX shall continue
in effect for the benefit of such retiring Administrative Agent and its
representatives and agents in respect of any actions taken or not taken by any
of them while it was serving as the Administrative Agent.
Section 9.8. Authorization to Execute other Loan Documents.
Each Lender hereby authorizes the Administrative Agent to execute on behalf of
all Lenders all Loan Documents other than this Agreement, including without
limitation all Security Documents.
ARTICLE X
MISCELLANEOUS
Section 10.1. Notices.
(a) Except in the case of notices and other communications
expressly permitted to be given by telephone, all notices and other
communications to any party herein to be effective shall be in writing and shall
be delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
To the Borrower: HEICO Corporation
3000 Taft Street
Hollywood, Florida 33021
Attention: Thomas S. Irwin
Telecopy Number: (954) 987-8228
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With a copy to: Akerman Senterfitt
1 S.E. Third Avenue
28th Floor
Miami, Florida 33131
Attention: Carl Roston, Esq.
Telecopy Number: (305) 374-5095
To the Administrative
Agent or Swingline
Lender: SunTrust Bank
200 South Orange Avenue
Orlando, Florida 32801
Attention: Mr. Ed Wooten
Telecopy Number: (407) 237-4076
With a copy to: SunTrust Bank
Agency Services
303 Peachtree Street, N. E./25th Floor
Atlanta, Georgia 30308
Attention: Ms. Hope Williams
Telecopy Number: (404) 658-4906
and
King & Spalding
191 Peachtree Street, N.E.
Atlanta, Georgia 30303
Attention: Carolyn Z. Alford
Telecopy Number: (404) 572-5100
To the Issuing Bank: SunTrust Bank
25 Park Place, N. E./Mail Code 3706
Atlanta, Georgia 30303
Attention: John Conley
Telecopy Number: (404) 588-8129
To the Swingline
Lender: SunTrust Bank
Agency Services
303 Peachtree Street, N.E./25th Floor
Atlanta, Georgia 30308
Attention: Ms. Hope Williams
Telecopy Number: (404) 658-4906
To any other Lender: the address set forth in the
Administrative Questionnaire
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Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All such notices
and other communications shall, when transmitted by overnight delivery, or
faxed, be effective when delivered for overnight (next-day) delivery, or
transmitted in legible form by facsimile machine, respectively, or if mailed,
upon the third Business Day after the date deposited into the mail or if
delivered, upon delivery; provided, that notices delivered to the Administrative
Agent, the Issuing Bank or the Swingline Bank shall not be effective until
actually received by such Person at its address specified in this Section 10.1.
(b) Any agreement of the Administrative Agent and the
Lenders herein to receive certain notices by telephone or facsimile is solely
for the convenience and at the request of the Borrower. The Administrative Agent
and the Lenders shall be entitled to rely on the authority of any Person
purporting to be a Person authorized by the Borrower to give such notice and the
Administrative Agent and Lenders shall not have any liability to the Borrower or
other Person on account of any action taken or not taken by the Administrative
Agent or the Lenders in reliance upon such telephonic or facsimile notice. The
obligation of the Borrower to repay the Loans and all other Obligations
hereunder shall not be affected in any way or to any extent by any failure of
the Administrative Agent and the Lenders to receive written confirmation of any
telephonic or facsimile notice or the receipt by the Administrative Agent and
the Lenders of a confirmation which is at variance with the terms understood by
the Administrative Agent and the Lenders to be contained in any such telephonic
or facsimile notice.
Section 10.2. Waiver; Amendments.
(a) No failure or delay by the Administrative Agent, the
Issuing Bank or any Lender in exercising any right or power hereunder or any
other Loan Document, and no course of dealing between the Borrower and the
Administrative Agent or any Lender, shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power or any abandonment or
discontinuance of steps to enforce such right or power, preclude any other or
further exercise thereof or the exercise of any other right or power hereunder
or thereunder. The rights and remedies of the Administrative Agent, the Issuing
Bank and the Lenders hereunder and under the other Loan Documents are cumulative
and are not exclusive of any rights or remedies provided by law. No waiver of
any provision of this Agreement or any other Loan Document or consent to any
departure by the Borrower therefrom shall in any event be effective unless the
same shall be permitted by paragraph (b) of this Section, and then such waiver
or consent shall be effective only in the specific instance and for the purpose
for which given. Without limiting the generality of the foregoing, the making of
a Loan or the issuance of a Letter of Credit shall not be construed as a waiver
of any Default or Event of Default, regardless of whether the Administrative
Agent, any Lender or the Issuing Bank may have had notice or knowledge of such
Default or Event of Default at the time.
(b) No amendment or waiver of any provision of this
Agreement or the other Loan Documents, nor consent to any departure by any Loan
Party therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Borrower and the Required Lenders or the Borrower and
the Administrative Agent with the consent of the Required Lenders (which consent
shall be deemed given if the Administrative Agent has the right of waiver
expressly granted herein without further consent by any Lender) and then such
waiver or consent
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shall be effective only in the specific instance and for the specific purpose
for which given; provided, that no amendment or waiver shall: (i) increase the
Commitment of any Lender without the written consent of such Lender, (ii) reduce
the principal amount of any Loan or LC Disbursement or reduce the rate of
interest thereon, or reduce any fees payable hereunder, without the written
consent of each Lender affected thereby, (iii) postpone the date fixed for any
payment of any principal of, or interest on, any Loan or LC Disbursement or
interest thereon or any fees hereunder or reduce the amount of, waive or excuse
any such payment, or postpone the scheduled date for the termination or
reduction of any Commitment, without the written consent of each Lender affected
thereby (except for such payments due pursuant to Section 2.13), (iv) change
Section 2.22 (b) or (c) in a manner that would alter the pro rata sharing of
payments required thereby, without the written consent of each Lender, (v)
change any of the provisions of this Section or the definition of "Required
Lenders" or any other provision hereof specifying the number or percentage of
Lenders which are required to waive, amend or modify any rights hereunder or
make any determination or grant any consent hereunder, without the consent of
each Lender; (vi) release any guarantor or limit the liability of any such
guarantor under any guaranty agreement, without the written consent of each
Lender; (vii) release all or substantially all Collateral securing any of the
Obligations, without the written consent of each Lender; provided further, that
no such agreement shall amend, modify or otherwise affect the rights, duties or
obligations of the Administrative Agent, the Swingline Bank or the Issuing Bank
without the prior written consent of such Person.
Section 10.3. Expenses; Indemnification.
(a) The Borrower shall pay (i) all reasonable and customary,
out-of-pocket costs and expenses of the Administrative Agent and its Affiliates,
including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent and its Affiliates, in connection with the syndication of
the credit facilities provided for herein, the preparation and administration of
the Loan Documents and any amendments, modifications or waivers thereof (whether
or not the transactions contemplated in this Agreement or any other Loan
Document shall be consummated), (ii) all reasonable and customary out-of-pocket
expenses incurred by the Issuing Bank in connection with the issuance,
amendment, renewal or extension of any Letter of Credit or any demand for
payment thereunder and (iii) all out-of-pocket costs and expenses (including,
without limitation, the reasonable fees, charges and disbursements of outside
counsel and the allocated cost of inside counsel) incurred by the Administrative
Agent, the Issuing Bank or any Lender in connection with the enforcement or
protection of its rights in connection with this Agreement or any other Loan
Document, including its rights under this Section, or in connection with the
Loans made or any Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.
(b) The Borrower shall indemnify the Administrative Agent,
the Issuing Bank and each Lender, and each Related Party of any of the foregoing
(each, an "Indemnitee") against, and hold each of them harmless from, any and
all costs, losses, liabilities, claims, damages and related expenses, including
the reasonable fees, charges and disbursements of any counsel for any
Indemnitee, which may be incurred by or asserted against any Indemnitee arising
out of, in connection with or as a result of (i) the execution or delivery of
this Agreement or any other agreement or instrument contemplated hereby, the
performance by the parties hereto of
80
their respective obligations hereunder or the consummation of any of the
transactions contemplated hereby, (ii) any Loan or Letter of Credit or any
actual or proposed use of the proceeds therefrom (including any refusal by the
Issuing Bank to honor a demand for payment under a Letter of Credit if the
documents presented in connection with such demand do not strictly comply with
the terms of such Letter of Credit), (iii) any actual or alleged presence or
release of Hazardous Materials on or from any property owned by the Borrower or
any Subsidiary or any Environmental Liability related in any way to the Borrower
or any Subsidiary or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory and regardless of whether any Indemnitee is a
party thereto; provided, that the Borrower shall not be obligated to indemnify
any Indemnitee for any of the foregoing arising primarily out of such
Indemnitee's gross negligence or willful misconduct as determined by a court of
competent jurisdiction in a final, nonappealable judgment. The foregoing
provisions shall be in addition to any right that Indemnitee shall have at
common law or otherwise. No Indemnitee shall be liable for any damages arising
from the use by others of information or others obtained through internet,
Intralinks(R), or other similar transmission services in connection with this
Agreement. No Indemnitee shall have any liability (whether direct or indirect,
in contract or tort or otherwise) to the Borrower or any other Loan Party
arising out of, related to or in connection with the transactions contemplated
by the Loan Documents, except to the extent that such liability shall be finally
judicially determined by a court of competent jurisdiction to have resulted from
such Indemnitee's gross negligence or willful misconduct. No Indemnitee shall be
responsible or liable for special, indirect, consequential or punitive damages
which may be alleged to arise in any manner in connection with this Agreement or
the Loan Documents or any transaction contemplated hereby. The foregoing
indemnification and limitation on liability shall survive and continue for the
benefit of the Indemnitees.
(c) The Borrower shall pay, and hold the Administrative
Agent and each of the Lenders harmless from and against, any and all present and
future stamp, documentary, and other similar taxes with respect to this
Agreement and any other Loan Documents, any collateral described therein, or any
payments due thereunder, and save the Administrative Agent and each Lender
harmless from and against any and all liabilities with respect to or resulting
from any delay or omission to pay such taxes.
(d) To the extent that the Borrower fails to pay any amount
required to be paid to the Administrative Agent, the Issuing Bank or the
Swingline Lender under clauses (a), (b) or (c) hereof, each Lender severally
agrees to pay to the Administrative Agent, the Issuing Bank or the Swingline
Lender, as the case may be, such Lender's Pro Rata Share (determined as of the
time that the unreimbursed expense or indemnity payment is sought) of such
unpaid amount; provided, that the unreimbursed expense or indemnified payment,
claim, damage, liability or related expense, as the case may be, was incurred by
or asserted against the Administrative Agent, the Issuing Bank or the Swingline
Lender in its capacity as such.
(e) To the extent permitted by applicable law, the Borrower
shall not assert, and hereby waives, any claim against any Indemnitee, on any
theory of liability, for special, indirect, consequential or punitive damages
(as opposed to actual or direct damages) arising out of, in connection with or
as a result of, this Agreement or any agreement or instrument
81
contemplated hereby, the transactions contemplated therein, any Loan or any
Letter of Credit or the use of proceeds thereof.
(f) All amounts due under this Section shall be payable
promptly after written demand therefor.
Section 10.4. Successors and Assigns.
(a) The provisions of this Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns permitted hereby, except that the Borrower may not assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of each Lender (and any attempted assignment or transfer by the
Borrower without such consent shall be null and void). Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any Person
(other than the parties hereto, their respective successors and assigns
permitted hereby and, to the extent expressly contemplated hereby, the Related
Parties of each of the Administrative Agent and the Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.
(b) Any Lender may assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Commitment and the Loans at the time owing to it);
provided that (i) except in the case of an assignment of the entire remaining
amount of the assigning Lender's Commitment and the Loans at the time owing to
it or in the case of an assignment to a Lender, an Affiliate of a Lender or an
Approved Fund with respect to a Lender, the aggregate amount of the Commitment
(which for this purpose includes Loans outstanding thereunder) of the assigning
Lender subject to each such assignment (determined as of the date the Assignment
and Acceptance with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $1,000,000, in the case of any
assignment of a Revolving Loan or reimbursement obligation of outstanding
Letters of Credit, unless each of the Administrative Agent and, so long as no
Event of Default has occurred and is continuing, the Borrower otherwise consents
(each such consent not to be unreasonably withheld or delayed), (ii) each
partial assignment shall be made as an assignment of a proportionate part of all
the assigning Lender's rights and obligations under this Agreement with respect
to the Loan or the Commitment assigned and (iii) the parties to each assignment
shall execute and deliver to the Administrative Agent an Assignment and
Acceptance, together with a processing and recordation fee of $1,000, and the
Eligible Assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire. Upon (i) the execution and
delivery of the Assignment and Acceptance by the assigning Lender and assignee
Lender, (ii) acceptance and recording thereof by the Administrative Agent
pursuant to paragraph (c) of this Section, (iii) consent thereof from the
Borrower to the extent required pursuant to this clause (b) and (iv) if such
assignee Lender is a Foreign Lender, compliance by such Person with Section
2.21(e), from and after the effective date specified in each Assignment and
Acceptance, the Eligible Assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Acceptance, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Acceptance, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all of the assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to
82
the benefits of Sections 2.19, 2.20, 2.21 and 10.3. Any assignment or transfer
by a Lender of rights or obligations under this Agreement that does not comply
with this paragraph shall be treated for purposes of this Agreement as a sale by
such Lender of a participation in such rights and obligations in accordance with
paragraph (d) of this Section. If the consent of the Borrower to an assignment
or to an Eligible Assignee is required hereunder (other than a consent to an
assignment which does not meet the minimum assignment thresholds specified in
paragraph (b)(i) above), the Borrower shall be deemed to have given its consent
five Business Days after the date notice thereof has actually been delivered by
the assigning Lender (through the Administrative Agent) to the Borrower, unless
such consent is expressly refused by the Borrower prior to such fifth Business
Day.
(c) The Administrative Agent, acting solely for this purpose
as an agent of the Borrower, shall maintain at one of its offices in Atlanta,
Georgia a copy of each Assignment and Acceptance delivered to it and a register
for the recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amount of the Loans owing to, each Lender pursuant
to the terms hereof from time to time (the "Register"). The entries in the
Register shall be conclusive, and the Borrower, the Administrative Agent and the
Lenders may treat each Person whose name is recorded in the Register pursuant to
the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary.
(d) Any Lender may, without the consent of, or notice to,
the Borrower, the Administrative Agent, the Swingline Bank or the Issuing Bank
sell participations to one or more banks or other entities (a "Participant") in
all or a portion of such Lender's rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans owing to it);
provided 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 and (iii) the Borrower, the
Administrative Agent, the Swingline Bank, the Issuing Bank 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. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any provision of this
Agreement; provided that such agreement or instrument may provide that such
Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver with respect to the following to the extent affecting
such Participant: (i) increase the Commitment of any Lender without the written
consent of such Lender, (ii) reduce the principal amount of any Loan or LC
Disbursement or reduce the rate of interest thereon, or reduce any fees payable
hereunder, without the written consent of each Lender affected thereby, (iii)
postpone the date fixed for any payment of any principal of, or interest on, any
Loan or LC Disbursement or interest thereon or any fees hereunder or reduce the
amount of, waive or excuse any such payment, or postpone the scheduled date for
the termination or reduction of any Commitment, without the written consent of
each Lender affected thereby, (iv) change Section 2.22(b) or (c) in a manner
that would alter the pro rata sharing of payments required thereby, without the
written consent of each Lender, (v) change any of the provisions of this Section
or the definition of "Required Lenders" or any other provision hereof specifying
the number or percentage of Lenders which are required to waive, amend or modify
any rights hereunder or make any determination or grant any consent hereunder,
without the consent of each Lender; (vi) release any guarantor or limit the
liability of
83
any such guarantor under any guaranty agreement without the written consent of
each Lender except to the extent such release is expressly provided under the
terms of the Guaranty Agreement; or (vii) release all or substantially all
Collateral securing any of the Obligations. Subject to paragraph (e) of this
Section, the Borrower agrees that each Participant shall be entitled to the
benefits of Sections 2.19, 2.20, and 2.21 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 10.7 as though it were a Lender, provided
such Participant agrees to be subject to Section 10.7 as though it were a
Lender.
(e) A Participant shall not be entitled to receive any
greater payment under Section 2.19 and Section 2.21 than the applicable Lender
would have been entitled to receive with respect to the participation sold to
such Participant, unless the sale of the participation to such Participant is
made with the Borrower's prior written consent. A Participant that would be a
Foreign Lender if it were a Lender shall not be entitled to the benefits of
Section 2.21 unless the Borrower is notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the Borrower, to
comply with Section 2.21(e) as though it were a Lender.
(f) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including without limitation any pledge or
assignment to secure obligations to a Federal Reserve Bank; provided that no
such pledge or assignment of a security interest shall release a Lender from any
of its obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.
Section 10.5. Governing Law; Jurisdiction; Consent to Service
of Process.
(a) This Agreement and the other Loan Documents shall be
construed in accordance with and be governed by the law (without giving effect
to the conflict of law principles thereof) of the State of Florida.
(b) The Borrower hereby irrevocably and unconditionally
submits, for itself and its property, to the non-exclusive jurisdiction of the
United States courts located within Broward County in the State of Florida, and
of any state court of the State of Florida located in Broward County and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or any other Loan Document or the transactions
contemplated hereby or thereby, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such Florida state court or, to the extent permitted by
applicable law, such Federal court. Each of the parties hereto agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement or any other Loan Document shall
affect any right that the Administrative Agent, the Issuing Bank or any Lender
may otherwise have to bring any action or proceeding relating to this Agreement
or any other Loan Document against the Borrower or its properties in the courts
of any jurisdiction.
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(c) The Borrower irrevocably and unconditionally waives any
objection which it may now or hereafter have to the laying of venue of any such
suit, action or proceeding described in paragraph (b) of this Section and
brought in any court referred to in paragraph (b) of this Section. Each of the
parties hereto irrevocably waives, to the fullest extent permitted by applicable
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to the
service of process in the manner provided for notices in Section 10.1. Nothing
in this Agreement or in any other Loan Document will affect the right of any
party hereto to serve process in any other manner permitted by law.
Section 10.6. WAIVER OF JURY TRIAL. EACH PARTY HERETO
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY
ARISING OUT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
Section 10.7. Right of Setoff. In addition to any rights now
or hereafter granted under applicable law and not by way of limitation of any
such rights, each Lender and the Issuing Bank shall have the right, at any time
or from time to time upon the occurrence and during the continuance of an Event
of Default, without prior notice to the Borrower, any such notice being
expressly waived by the Borrower to the extent permitted by applicable law, to
set off and apply against all deposits (general or special, time or demand,
provisional or final) of the Borrower at any time held or other obligations at
any time owing by such Lender and the Issuing Bank to or for the credit or the
account of the Borrower against any and all Obligations held by such Lender or
the Issuing Bank, as the case may be, irrespective of whether such Lender or the
Issuing Bank shall have made demand hereunder and although such Obligations may
be unmatured. Each Lender and the Issuing Bank agree promptly to notify the
Administrative Agent and the Borrower after any such set-off and any application
made by such Lender and the Issuing Bank, as the case may be; provided, that the
failure to give such notice shall not affect the validity of such set-off and
application. Each Lender and the Issuing Bank agrees to apply all amounts
collected from any such set-off to the Obligations before applying such amounts
to any other Indebtedness or other obligations owed by the Borrower and any of
its Subsidiaries to such Lender or Issuing Bank.
Section 10.8. Counterparts; Integration. This Agreement may be
executed by one or more of the parties to this Agreement on any number of
separate counterparts (including by telecopy), and all of said counterparts
taken together shall be deemed to constitute one and the same instrument. This
Agreement, the Fee Letter, the other Loan Documents, and any separate
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letter agreement(s) relating to any fees payable to the Administrative Agent
constitute the entire agreement among the parties hereto and thereto regarding
the subject matters hereof and thereof and supersede all prior agreements and
understandings, oral or written, regarding such subject matters.
Section 10.9. Survival. All covenants, agreements,
representations and warranties made by the Borrower herein and in the
certificates or other instruments delivered in connection with or pursuant to
this Agreement shall be considered to have been relied upon by the other parties
hereto and shall survive the execution and delivery of this Agreement and the
making of any Loans and issuance of any Letters of Credit, regardless of any
investigation made by any such other party or on its behalf and notwithstanding
that the Administrative Agent, the Issuing Bank or any Lender may have had
notice or knowledge of any Default or incorrect representation or warranty at
the time any credit is extended hereunder, and shall continue in full force and
effect as long as the principal of or any accrued interest on any Loan or any
fee or any other amount payable under this Agreement is outstanding and unpaid
or any Letter of Credit is outstanding and so long as the Commitments have not
expired or terminated. The provisions of Sections 2.19, 2.20, 2.21, and 10.3 and
Article IX shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof. All
representations and warranties made herein, in the certificates, reports,
notices, and other documents delivered pursuant to this Agreement shall survive
the execution and delivery of this Agreement and the other Loan Documents, and
the making of the Loans and the issuance of the Letters of Credit.
Section 10.10. Severability. Any provision of this Agreement or
any other Loan Document held to be illegal, invalid or unenforceable in any
jurisdiction, shall, as to such jurisdiction, be ineffective to the extent of
such illegality, invalidity or unenforceability without affecting the legality,
validity or enforceability of the remaining provisions hereof or thereof; and
the illegality, invalidity or unenforceability of a particular provision in a
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
Section 10.11. Confidentiality.
(a) Each of the Administrative Agent, the Issuing Bank and
each Lender shall exercise their best efforts not to make any disclosure of
confidential information obtained in connection with or pursuant to the Loan
Documents (or permit any such disclosure of confidential information by their
respective Related Parties); provided, that the foregoing shall not be construed
to, now or in the future, apply to any information reflected in any publicly
recorded document, information obtained from sources other than the Borrower,
its officers, directors, employees, representatives, or agents, or otherwise in
the public domain nor shall it be construed to prevent the Administrative Agent,
the Issuing Bank or any Lender from (i) making any disclosure of any information
(A) if required to do so by any applicable law or regulation or if normally
engaged in pursuant to accepted banking practice solely for purposes of
monitoring, negotiating, maintaining or enforcing the Loan Documents and not
contrary to confidentiality and privacy requirements of applicable statutory and
case law, (B) to any governmental agency or regulatory body having authority to
regulate or oversee any aspect of the Administrative Agent's, Issuing Bank's or
such Lender's business or any of its Subsidiaries or Affiliates in
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connection with the exercise of such authority, (C) pursuant to subpoena, (D) to
the extent the Administrative Agent, Issuing Bank or such Lender or their
respective counsel deems necessary or appropriate to do so to enforce any remedy
provided for in the Loan Documents or otherwise available by law, (ii) subject
to the requirements of this Section, making such disclosures as such Lender
reasonably deems necessary or appropriate to any bank or financial institution
(and/or counsel thereto) which is a prospective assignee or participant under
Section 10.4 (each such bank or financial institution, a "Prospective Lender")
or (iii) making, on a confidential basis, such disclosures as the Administrative
Agent, Issuing Bank or such Lender deems necessary or appropriate to the
Administrative Agent's, Issuing Bank or such Lender's counsel or accountants
(including outside auditors).
(b) Each Lender agrees that prior to (i) disclosing to any
Prospective Lender any information which the Lenders have agreed hereunder to
hold as confidential or (ii) entering into an agreement granting to a
Prospective Lender an interest in the Loans, the Prospective Lender shall
execute an agreement in form and substance similar to the provisions of this
Section for the benefit of the Borrower and shall deliver the same to the
Borrower; provided, that in no event shall such Lender or the Administrative
Agent be liable for any breach of such agreement by the Prospective Lender.
Section 10.12. Interest Rate Limitation. Notwithstanding
anything herein to the contrary, if at any time the interest rate applicable to
any Loan, together with all fees, charges and other amounts which may be treated
as interest on such Loan under applicable law (collectively, the "Charges"),
shall exceed the maximum lawful rate of interest (the "Maximum Rate") which may
be contracted for, charged, taken, received or reserved by a Lender holding such
Loan in accordance with applicable law, the rate of interest payable in respect
of such Loan hereunder, together with all Charges payable in respect thereof,
shall be limited to the Maximum Rate and, to the extent lawful, the interest and
Charges that would have been payable in respect of such Loan but were not
payable as a result of the operation of this Section shall be cumulated and the
interest and Charges payable to such Lender in respect of other Loans or periods
shall be increased (but not above the Maximum Rate therefor) until such
cumulated amount, together with interest thereon at the Federal Funds Rate to
the date of repayment, shall have been received by such Lender.
Section 10.13. Waiver of Effect of Corporate Seal. The Borrower
represents and warrants that neither it nor any other Loan Party is required to
affix its corporate seal to this Agreement or any other Loan Document pursuant
to any requirement of law or regulation, agrees that this Agreement is delivered
by Borrower under seal and waives any shortening of the statute of limitations
that may result from not affixing the corporate seal to this Agreement or such
other Loan Documents.
(remainder of page left intentionally blank)
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed under seal in the case of the Borrower by their
respective authorized officers as of the day and year first above written.
HEICO CORPORATION
By
------------------------------------------
Name: Thomas S. Irwin
Title: Executive Vice President, Chief Financial
Officer and Treasurer
[SEAL]
SUNTRUST BANK, as Administrative Agent, as
Issuing Bank, as Swingline Lender and as a Lender
By
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Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
WACHOVIA BANK, NATIONAL ASSOCIATION
By
------------------------------------------
Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
HSBC BANK USA
By
------------------------------------------
Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
REGIONS BANK
By
------------------------------------------
Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
COMMERCEBANK, N.A.
By
------------------------------------------
Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
NORTHERN TRUST BANK OF FLORIDA N.A.
By
------------------------------------------
Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
ISRAEL DISCOUNT BANK OF NEW YORK
By
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Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]