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EXECUTION VERSION
EXHIBIT 10.46
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NEXTERA ENTERPRISES, INC.
CREDIT AGREEMENT
Dated as of December 30, 1999
BANKBOSTON, N.A., Administrative Agent
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BANCBOSTON XXXXXXXXX XXXXXXXX INC.,
Co-Adviser, Co-Lead Arranger and Co-Book Manager
BANC OF AMERICA SECURITIES LLC,
Syndication Agent,
Co-Adviser, Co-Lead Arranger and Co-Book Manager
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TABLE OF CONTENTS
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1. Definitions; Certain Rules of Construction...............................................................1
2. The Credits.............................................................................................25
2.1. Revolving Credit...............................................................................25
2.1.1. Revolving Loan........................................................................25
2.1.2. Maximum Amount of Revolving Credit....................................................25
2.1.3. Borrowing Requests....................................................................26
2.1.4. Revolving Notes.......................................................................26
2.2. Acquisition Credit.............................................................................26
2.2.1. Acquisition Loan......................................................................26
2.2.2. Maximum Amount of Acquisition Credit..................................................27
2.2.3. Borrowing Requests. .................................................................27
2.2.4. Acquisition Notes.....................................................................28
2.3. Letters of Credit..............................................................................28
2.3.1. Issuance of Letters of Credit.........................................................28
2.3.2. Requests for Letters of Credit........................................................28
2.3.3. Form and Expiration of Letters of Credit..............................................29
2.3.4. Lenders' Participation in Letters of Credit...........................................29
2.3.5. Reimbursement of Payment..............................................................29
2.3.6. UCP; ISP..............................................................................29
2.3.7. Subrogation...........................................................................31
2.3.8. Modification, Consent, etc............................................................31
2.4. Application of Proceeds........................................................................31
2.4.1. Revolving Loan........................................................................31
2.4.2. Acquisition Loan......................................................................31
2.4.3. Letters of Credit.....................................................................32
2.4.4. Specifically Prohibited Applications..................................................32
2.5. Option to Extend Maturities of Credits.........................................................32
2.6. Settlement under the Cash Management Agreement.................................................32
3. Interest; LIBOR Pricing Options; Fees...................................................................33
3.1. Interest.......................................................................................33
3.2. LIBOR Pricing Options..........................................................................33
3.2.1. Election of LIBOR Pricing Options.....................................................33
3.2.2. Notice to Lenders and the Company.....................................................34
3.2.3. Selection of LIBOR Interest Periods...................................................34
3.2.4. Reimbursement of Breakage Costs.......................................................35
3.2.5. Violation of Legal Requirements.......................................................35
3.2.6. Funding Procedure.....................................................................36
3.3. Commitment Fees................................................................................36
3.3.1. Revolving Credit Commitment Fee.......................................................36
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3.3.2. Acquisition Credit Commitment Fee.....................................................36
3.4. Letter of Credit Fees..........................................................................36
3.5. Changes in Circumstances; Yield Protection.....................................................37
3.5.1. Reserve Requirements, etc.............................................................37
3.5.2. Taxes.................................................................................37
3.5.3. Capital Adequacy......................................................................38
3.5.4. Regulatory Changes....................................................................38
3.5.5. Compensation Claims...................................................................38
3.5.6. Mitigation............................................................................39
3.6. Computations of Interest and Fees..............................................................39
4. Payment.................................................................................................39
4.1. Payment at Maturity............................................................................39
4.2. Contingent Required Prepayments................................................................39
4.2.1. Excess Credit Exposure................................................................39
4.2.2. Net Asset Sale Proceeds...............................................................40
4.2.3. Net Debt Proceeds.....................................................................40
4.2.4. Net Equity Proceeds...................................................................40
4.2.5. Cash Management Agreement.............................................................40
4.3. Voluntary Prepayments..........................................................................40
4.4. Letters of Credit..............................................................................40
4.5. Reborrowing; Application of Payments, etc......................................................41
4.5.1. Reborrowing...........................................................................41
4.5.2. Order of Application..................................................................41
4.5.3. Payments for Lenders..................................................................41
5. Conditions to Extending Credit..........................................................................41
5.1. Conditions on Initial Closing Date.............................................................41
5.1.1 . Notes.................................................................................42
5.1.2. Payment of Fees.......................................................................42
5.1.3. Legal Opinions........................................................................42
5.1.4. Guarantee and Security Agreement......................................................42
5.1.5. Perfection of Security................................................................42
5.1.6. Subordination Agreement...............................................................42
5.1.7. Solvency..............................................................................43
5.1.8. Termination of Prior Credit Agreement.................................................43
5.1.9. Proper Proceedings....................................................................43
5.1.10. General...............................................................................44
5.2. Conditions to Each Extension of Credit.........................................................44
5.2.1. Officer's Certificate.................................................................44
5.2.2. Legality, etc.........................................................................44
6. General Covenants.......................................................................................44
6.1. Taxes and Other Charges; Accounts Payable......................................................45
6.1.1. Taxes and Other Charges...............................................................45
6.1.2. Accounts Payable......................................................................45
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6.2. Conduct of Business, etc.......................................................................45
6.2.1. Types of Business.....................................................................45
6.2.2. Maintenance of Properties.............................................................45
6.2.3. Statutory Compliance..................................................................46
6.2.4. Compliance with Material Agreements...................................................46
6.3. Insurance......................................................................................46
6.3.1. Business Interruption Insurance.......................................................46
6.3.2. Property Insurance....................................................................46
6.3.3. Liability Insurance...................................................................46
6.4. Financial Statements and Reports...............................................................47
6.4.1. Annual Reports........................................................................47
6.4.2. Quarterly Reports.....................................................................48
6.4.3. Monthly Reports.......................................................................49
6.4.4. Other Reports.........................................................................49
6.4.5. Notice of Litigation, Defaults, etc...................................................50
6.4.6. ERISA Reports.........................................................................50
6.4.7. Other Information.....................................................................51
6.5. Certain Financial Tests........................................................................51
6.5.1. Consolidated Total Debt to Consolidated Pro Forma EBITDA..............................51
6.5.2. Consolidated Pro Forma EBITDA Minus Capital Expenditures to
Consolidated Pro Forma Interest Expense ..............................................51
6.5.3. Quick Ratio...........................................................................51
6.5.4. Consolidated Adjusted Net Worth.......................................................52
6.6. Indebtedness...................................................................................52
6.7. Guarantees; Letters of Credit..................................................................53
6.8. Liens..........................................................................................53
6.9. Investments and Acquisitions...................................................................55
6.10. Distributions..................................................................................57
6.11. Asset Dispositions and Mergers.................................................................58
6.12. Issuance of Stock by Subsidiaries; Subsidiary Distributions....................................59
6.12.1. Issuance of Stock by Subsidiaries....................................................59
6.12.2. No Restrictions on Subsidiary Distributions..........................................59
6.13. Voluntary Prepayments of Other Indebtedness....................................................59
6.14. Derivative Contracts...........................................................................59
6.15. Negative Pledge Clauses........................................................................59
6.16. ERISA, etc.....................................................................................60
6.17. Transactions with Affiliates...................................................................60
6.18. Restricted Operations of Cranberry Hill Capital................................................60
7. Representations and Warranties..........................................................................60
7.1. Organization and Business......................................................................60
7.1.1. The Company...........................................................................60
7.1.2. Subsidiaries..........................................................................61
7.1.3. Qualification.........................................................................61
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7.1.4. Capitalization........................................................................62
7.2. Financial Statements and Other Information; Material Agreements................................62
7.2.1. Financial Statements and Other Information............................................62
7.2.2. Material Agreements...................................................................63
7.3. Agreements Relating to Financing Debt, Investments, etc........................................63
7.4. Changes in Condition...........................................................................64
7.5. Title to Assets................................................................................64
7.6. Operations in Conformity With Law, etc.........................................................64
7.7. Litigation.....................................................................................64
7.8. Authorization and Enforceability...............................................................65
7.9. No Legal Obstacle to Agreements................................................................65
7.10. Defaults.......................................................................................66
7.11. Licenses, etc..................................................................................66
7.12. Tax Returns....................................................................................66
7.13. Certain Business Representations...............................................................66
7.13.1. Labor Relations.......................................................................66
7.13.2. Antitrust.............................................................................67
7.13.3. Year 2000 Issues......................................................................67
7.13.4. Future Expenditures...................................................................67
7.14. Pension Plans..................................................................................67
7.15. Environmental Regulations......................................................................67
7.15.1. Environmental Compliance..............................................................67
7.15.2. Environmental Condition of Properties.................................................68
7.16. Government Regulation; Margin Stock............................................................68
7.16.1. Government Regulation.................................................................68
7.16.2. Margin Stock..........................................................................68
7.17. Disclosure.....................................................................................68
8. Defaults................................................................................................68
8.1. Events of Default..............................................................................68
8.1.1. Payment...............................................................................68
8.1.2. Specified Covenants...................................................................69
8.1.3. Other Covenants.......................................................................69
8.1.4. Representations and Warranties........................................................69
8.1.5. Material Financing Debt Cross Default, etc............................................69
8.1.6. Ownership; Liquidation; etc...........................................................70
8.1.7. Enforceability, etc...................................................................70
8.1.8. Judgments.............................................................................71
8.1.9. ERISA.................................................................................71
8.1.10. Bankruptcy, etc.......................................................................71
8.2. Certain Actions Following an Event of Default..................................................72
8.2.1. Terminate Obligation to Extend Credit.................................................72
8.2.2. Specific Performance; Exercise of Rights..............................................72
8.2.3. Acceleration..........................................................................72
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8.2.4. Enforcement of Payment; Credit Security; Setoff.......................................73
8.2.5. Cumulative Remedies...................................................................73
8.3. Annulment of Defaults..........................................................................73
8.4. Waivers........................................................................................73
9. Expenses; Indemnity.....................................................................................74
9.1. Expenses.......................................................................................74
9.2. General Indemnity..............................................................................74
9.3. Indemnity With Respect to Letters of Credit....................................................75
10. Operations; Agent.......................................................................................75
10.1. Interests in Credits...........................................................................75
10.2. Agent's Authority to Act, etc..................................................................75
10.3. Company to Pay Agent, etc......................................................................76
10.4. Lender Operations for Advances, Letters of Credit, etc.........................................76
10.4.1. Advances.............................................................................76
10.4.2. Letters of Credit....................................................................76
10.4.3. Agent to Allocate Payments, etc......................................................77
10.4.4. Nonperforming Lenders................................................................77
10.5. Sharing of Payments, etc.......................................................................78
10.6. Agent's Resignation............................................................................78
10.7. Concerning the Agent...........................................................................79
10.7.1. Action in Good Faith, etc............................................................79
10.7.2. No Implied Duties, etc...............................................................79
10.7.3. Validity, etc........................................................................79
10.7.4. Compliance...........................................................................80
10.7.5. Employment of Agents and Counsel.....................................................80
10.7.6. Reliance on Documents and Counsel....................................................80
10.7.7. Agent's Reimbursement................................................................80
10.8. Rights as a Lender.............................................................................80
10.9. Independent Credit Decision....................................................................81
10.10. Indemnification................................................................................81
11. Successors and Assigns; Lender Assignments and Participations...........................................81
11.1. Assignments by Lenders.........................................................................82
11.1.1. Assignees and Assignment Procedures..................................................82
11.1.2. Terms of Assignment and Acceptance...................................................83
11.1.3. Register.............................................................................84
11.1.4. Acceptance of Assignment and Assumption..............................................84
11.1.5. Federal Reserve Bank.................................................................84
11.1.6. Further Assurances...................................................................84
11.2. Credit Participants............................................................................85
11.3. Replacement of Lender..........................................................................85
12. Confidentiality.........................................................................................86
13. Foreign Lenders.........................................................................................87
14. Notices.................................................................................................88
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15. Amendments, Consents, Waivers, etc......................................................................88
15.1. Lender Consents for Amendments.................................................................88
15.2. Course of Dealing; No Implied Waivers..........................................................90
16. General Provisions......................................................................................90
16.1. Defeasance.....................................................................................90
16.2. No Strict Construction.........................................................................91
16.3. Certain Obligor Acknowledgments................................................................91
16.4. Venue; Service of Process; Certain Waivers.....................................................91
16.5. WAIVER OF JURY TRIAL...........................................................................92
16.6. Interpretation; Governing Law; etc.............................................................92
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EXHIBITS
2.1.4 - Revolving Note
2.2.4 - Acquisition Note
5.1.4 - Guarantee and Security Agreement
5.1.6 - Subordination Agreement
5.2.1 - Officer's Certificate
6.4. - Compliance Certificate
6.9.2 - Foreign Subsidiary Subordination Agreement
7.1 - Company and its Subsidiaries
7.2.2 - Material Agreements
7.3 - Financing Debt, Certain Investments, etc.
7.7 - Litigation
7.12 - Tax Matters
7.14 - Multi-employer and Defined Benefit Plans
7.15 - Hazardous Material Sites
7.16.2 - Margin Stock
10.1 - Percentage Interests
11.1.1 - Assignment and Acceptance
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NEXTERA ENTERPRISES, INC.
CREDIT AGREEMENT
This Agreement, dated as of December 30, 1999, is among Nextera
Enterprises, Inc., a Delaware corporation, its Subsidiaries from time to time
party hereto, the Lenders from time to time party hereto and BankBoston, N.A.,
both in its capacity as a Lender and in its capacity as administrative agent for
the Lenders. The parties agree as follows:
RECITALS: Pursuant to this Agreement, the Lenders are extending to the
Company a $15,000,000 revolving credit facility, including a $7,500,000
sub-allotment for Letters of Credit, and a $40,000,000 revolving acquisition
facility. All the credit facilities mature on March 29, 2002. These credit
facilities are guaranteed by the Company's Domestic Subsidiaries and are secured
by liens on substantially all the assets of the Company and its Domestic
Subsidiaries (excluding Cranberry Hill Capital, LLC and 34% of the voting stock
of Foreign Subsidiaries owned by the Company and its Domestic Subsidiaries). The
proceeds of these credit facilities may be used to refinance existing
Indebtedness, to make certain acquisitions and for general corporate purposes,
each as provided herein.
1. DEFINITIONS; CERTAIN RULES OF CONSTRUCTION. Certain capitalized terms are
used in this Agreement and in the other Credit Documents with the specific
meanings defined below in this Section 1. Except as otherwise explicitly
specified to the contrary or unless the context clearly requires otherwise, (a)
the capitalized term "Section" refers to sections of this Agreement, (b) the
capitalized term "Exhibit" refers to exhibits to this Agreement, (c) references
to a particular Section include all subsections thereof, (d) the word
"including" shall be construed as "including without limitation", (e) accounting
terms not otherwise defined herein have the meaning provided under GAAP, (f)
references to a particular statute or regulation include all rules and
regulations thereunder and any successor statute, regulation or rules, in each
case as from time to time in effect, (g) references to a particular Person
include such Person's successors and assigns to the extent not prohibited by
this Agreement and the other Credit Documents and (h) references to "Dollars" or
"$" mean United States Funds. References to "the date hereof" mean the date
first set forth above.
"ACCUMULATED BENEFIT OBLIGATIONS" means the actuarial present value of the
accumulated benefit obligations under any Plan, calculated in accordance with
Statement No. 87 of the Financial Accounting Standards Board.
"ACQUISITION LOAN" is defined in Section 2.2.4.
"ACQUISITION NOTES" is defined in Section 2.2.4.
"AFFECTED LENDER" is defined in Section 11.3.
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"AFFILIATE" means, with respect to the Company (or any other specified
Person), any other Person directly or indirectly controlling, controlled by or
under direct or indirect common control with the Company (or such specified
Person), and shall include (a) any officer or director or general partner of the
Company (or such specified Person), (b) any Person of which the Company (or such
specified Person) or any Affiliate (as defined in clause (a) above) of the
Company (or such specified Person) shall, directly or indirectly, beneficially
own either (i) at least 10% of the outstanding equity securities having the
general power to vote or (ii) at least 10% of all equity interests or (c) any
Person directly or indirectly controlling the Company (or such specified Person)
through a management agreement, voting agreement or other contract.
"AGENT" means BankBoston in its capacity as administrative agent for the
Lenders hereunder, as well as its successors and assigns in such capacity
appointed pursuant to Section 10.6.
"AGREEMENT" means this Credit Agreement as from time to time amended,
modified and in effect.
"APPLICABLE MARGIN" means (a) from the Initial Closing Date through the
fifth Banking Day after which the Company delivers quarterly financial
statements in accordance with Section 6.4.2 for the fiscal quarter ending March
31, 2000, a percentage no lower than the percentage set forth below as Level I
and (b) on each day thereafter, the percentage in the table below set opposite
the Reference Leverage Ratio for such date:
Base Rate LIBOR Commitment
Reference Leverage Ratio Applicable Margin Applicable Margin Fee Rate
------------------------ ----------------- ----------------- --------
I. Less than 3.00:1.00 but greater 1.50% 2.75% 0.50%
than or equal to 2.50:1.00
II. Less than 2.50:1.00 but greater 1.00 2.25 0.50
than or equal to 2.00:1.00
III. Less than 2.00:1.00 but greater 0.75 2.00 0.45
than or equal to 1.50:1.00
IV. Less than 1.50:1.00 but greater 0.50 1.75 0.40
than or equal to 1.00:1.00
V. Less than 1.00:1.00 0.25 1.50 0.35
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Changes in the Applicable Margin shall occur on the fifth Banking Day after
quarterly financial statements have been furnished to the Agent in accordance
with Sections 6.4.1 or 6.4.2 from time to time. In the event that the financial
statements required to be delivered pursuant to Section 6.4.1 or 6.4.2, as
applicable, are not delivered when due, then during the period from the fifth
Banking Day following the date such financial statements were due until the
fifth Banking Day following the date on which they are actually delivered, the
Applicable Margin shall be the maximum amount set forth in the table above.
"APPLICABLE RATE" means, at any date, the sum of:
(a) (i) with respect to each portion of the Loan subject to a LIBOR
Pricing Option, the sum of the Applicable Margin (which may change
during the LIBOR Interest Period for such LIBOR Pricing Option in
accordance with the definition of "Applicable Margin") PLUS the LIBOR
Rate with respect to such LIBOR Pricing Option;
(ii) with respect to each other portion of the Loan, the sum of
the Applicable Margin PLUS the Base Rate;
PLUS (b) an additional 2% per annum effective on the day the Agent provides
written notice to the Company that the interest rates hereunder are
increasing as a result of the occurrence and continuance of an Event
of Default until the earlier of such time as (i) such Event of Default
is no longer continuing or (ii) such Event of Default is deemed no
longer to exist, in each case pursuant to Section 8.3.
"ASSIGNEE" is defined in Section 11.1.1.
"ASSIGNMENT AND ACCEPTANCE" is defined in Section 11.1.1.
"BANKBOSTON" means BankBoston, N.A.
"BANKING DAY" means any day other than Saturday, Sunday or a day on which
banks in Boston, Massachusetts are authorized or required by law or other
governmental action to close and, if such term is used with reference to a LIBOR
Pricing Option, any day on which dealings are effected in the LIBOR Deposits in
question by first-class banks in the inter-bank LIBOR markets in New York, New
York.
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"BANKRUPTCY CODE" means Title 11 of the United States Code.
"BANKRUPTCY DEFAULT" means an Event of Default referred to in Section
8.1.10.
"BASE RATE" means, on any date, the greater of (a) the rate of interest
announced by BankBoston at the Boston Office as its Base Rate or (b) the sum of
1/2% PLus the Federal Funds Rate.
"BOSTON OFFICE" means the principal banking office of BankBoston in Boston,
Massachusetts.
"BY-LAWS" means all written by-laws, rules, regulations and all other
documents relating to the management, governance or internal regulation of any
Person other than an individual, all as from time to time in effect.
"CAPITAL EXPENDITURES" means, for any period, amounts added or required to
be added to the property, plant and equipment or other fixed assets account on
the Consolidated balance sheet of the Company and its Subsidiaries, prepared in
accordance with GAAP, including expenditures in respect of (a) the acquisition,
construction, improvement or replacement of land, buildings, machinery,
equipment, leaseholds and any other real or personal property, (b) to the extent
not included in clause (a) above, materials, contract labor and direct labor
relating thereto (excluding amounts properly expensed as repairs and maintenance
in accordance with GAAP) and (c) software development costs to the extent not
expensed; PROVIDED, HOWEVER, that Capital Expenditures shall not include (i) the
purchase price for the acquisition of another Person (or substantially all the
assets of another Person) as a going concern permitted by Section 6.9 or (ii)
expenditures made with the proceeds of condemnation awards or insurance claims.
"CAPITALIZED LEASE" means any lease which is required to be capitalized on
the balance sheet of the lessee in accordance with GAAP, including Statement
Nos. 13 and 98 of the Financial Accounting Standards Board.
"CAPITALIZED LEASE OBLIGATIONS" means the amount of the liability
reflecting the aggregate discounted amount of future payments under all
Capitalized Leases calculated in accordance with GAAP, including Statement Nos.
13 and 98 of the Financial Accounting Standards Board.
"CASH EQUIVALENTS" means:
(1) negotiable certificates of deposit, time deposits (including
sweep accounts), demand deposits and bankers' acceptances having a maturity
of nine months
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or less and issued by any United States financial institution having
capital and surplus and undivided profits aggregating at least $100,000,000
and rated at least Prime-1 by Xxxxx'x or A-1 by S&P or issued by any
Lender;
(2) corporate obligations having a maturity of nine months or less
and rated at least Prime-1 by Xxxxx'x or A-1 by S&P or issued by any
Lender;
(3) any direct obligation of the United States of America or any
agency or instrumentality thereof, or of any state or municipality thereof,
(i) which has a remaining maturity at the time of purchase of not more than
one year or which is subject to a repurchase agreement with any Lender (or
any other financial institution referred to in clause (a) above)
exercisable within one year from the time of purchase and (ii) which, in
the case of obligations of any state or municipality, is rated at least Aaa
by Xxxxx'x or AAA by S&P;
(4) any mutual fund or other pooled investment vehicle rated at least
Aa by Xxxxx'x or AA by S&P which invests principally in obligations
described above; and
(5) any Investment by a Foreign Subsidiary in its local jurisdiction
comparable to the items described above.
"CASH MANAGEMENT AGREEMENT" means any Cash Management Master Agreement
entered into between the Agent and the Company from time to time, as from time
to time in effect, including all schedules and addenda thereto, relating to cash
management, sweep account and other similar services provided by the Agent to
the Company to facilitate daily advances and repayments in connection with the
Company's operations and working capital requirements.
"CERCLA" means the federal Comprehensive Environmental Response,
Compensation and Liability Act of 1980.
"CHARTER" means the articles of organization, certificate of incorporation,
statute, constitution, joint venture agreement, partnership agreement, trust
indenture, limited liability company agreement or other charter document of any
Person other than an individual, each as from time to time in effect.
"CLOSING DATE" means the Initial Closing Date and each other date on which
any extension of credit is made pursuant to Sections 2.1, 2.2 or 2.3.
"CODE" means the federal Internal Revenue Code of 1986.
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"COMMITMENT" means, with respect to any Lender, such Lender's obligations
to extend the respective credits contemplated by Section 2 and its interests in
such credits at any time outstanding. The original Commitments are set forth in
Exhibit 10.1 and the subsequent Commitments are recorded from time to time in
the Register.
"COMMITMENT FEE RATE" means, at any date, the sum of (a) the rate per annum
equal to the Applicable Margin with respect to the Commitment Fee Rate PLUS (b)
an additional 2% per annum effective on the day the Agent provides written
notice to the Company that the interest rates hereunder are increasing as a
result of the occurrence and continuance of an Event of Default until the
earlier of such time as (i) such Event of Default is no longer continuing or
(ii) such Event of Default is deemed no longer to exist, in each case pursuant
to Section 8.3.
"COMPANY" means Nextera Enterprises, Inc., a Delaware corporation.
"COMPUTATION COVENANTS" means Sections 6.5, 6.6.7, 6.6.13, 6.9.5, 6.9.8,
6.10.2, 6.10.3, 6.11.6 and 6.11.7.
"CONSOLIDATED" and "CONSOLIDATING", when used with reference to any term,
mean that term as applied to the accounts of the Company (or other specified
Person) and all of its Subsidiaries (or other specified group of Persons), or
such of its Subsidiaries as may be specified, consolidated (or combined) or
consolidating (or combining), as the case may be, in accordance with GAAP and
with appropriate deductions for minority interests in Subsidiaries.
"CONSOLIDATED ADJUSTED POSITIVE CONSOLIDATED NET INCOME" means, for any
period, the amount, if any, by which the sum of Consolidated Net Income PLUS
Consolidated Adjustment Items exceeds zero.
"CONSOLIDATED ADJUSTED NET WORTH" means, at any date, the sum of
Consolidated Net Worth PLUS the cumulative amount of all Consolidated Adjustment
Items incurred after June 30, 1999.
"CONSOLIDATED ADJUSTMENT ITEMS" means, for any period, the remainder of the
following items (in each case net of the tax benefit or expense provided by each
item): (a) to the extent such amounts have reduced Consolidated Net Income for
such period (i) non-cash compensation charges associated with the issuance of
stock options or other equity instruments to employees or third parties; PLUS
(ii) non-cash charges associated with the write-off of in-process research and
development costs in connection with acquisitions consummated within 100 days of
such write-off; PLUS (iii) the non-cash portion of restructuring charges
incurred after June 30, 1999; MINUS (b) to the extent such amounts have not
reduced Consolidated Net Income for such period, the cash portion of
restructuring charges incurred after June 30, 1999 and paid during such period.
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"CONSOLIDATED CURRENT LIABILITIES" means, at any date, all amounts that are
or should be carried as current liabilities on the balance sheet of the Company
and its Subsidiaries determined in accordance with GAAP on a Consolidated basis,
including the current portion of all long-term Financing Debt.
"CONSOLIDATED EBITDA" means, for any period, the total of:
(a) Consolidated Net Income;
PLUS (b) all amounts deducted in computing such Consolidated Net Income in
respect of:
(1) depreciation, amortization and other non-cash charges
(including non-cash transaction charges related to acquisitions
permitted by Section 6.9),
(2) interest expense,
(3) taxes based upon or measured by net income,
(4) non-recurring cash transaction costs related to acquisitions
permitted by Section 6.9 and
(5) management fees charged by Knowledge Universe for periods
ending prior to May 19, 1999;
MINUS (c) all cash payments made during such period on account of reserves,
restructuring charges and other non-cash charges deducted from Consolidated
Net Income in a previous period;
MINUS (d) all amounts included in Consolidated Net Income in respect of
deferred income tax benefits and other non-cash income items (other than
accounts receivable and other normal current accrued income items in the
ordinary course of business).
"CONSOLIDATED INTEREST EXPENSE" means, for any period, the total of:
(a) the aggregate amount of interest, including commitment fees and
other financing fees and costs, payments in the nature of interest under
Capitalized Leases and net payments under Hedge Agreements, accrued by the
Company and its Subsidiaries (whether such interest is reflected as an item
of expense or capitalized) in accordance with GAAP on a Consolidated basis,
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MINUS (b) to the extent otherwise included in clause (a) above, the
amortization of deferred financing fees and costs, original issue discount
relating to Indebtedness and accrued interest on Indebtedness not paid in
cash to the extent permitted by the terms, including subordination terms,
of such Indebtedness (including PIK Interest),
PLUS (c) actual cash payments with respect to accrued and unpaid interest
(including PIK Interest) that has previously reduced Consolidated Interest
Expense pursuant to clause (b) above,
MINUS (d) interest paid on the Debentures and bridge financing Indebtedness
at the closing of the initial underwritten public offering of the Company's
stock.
"CONSOLIDATED NET INCOME" means, for any period, the net income (or loss)
of the Company and its Subsidiaries, determined in accordance with GAAP on a
Consolidated basis; PROVIDED, HOWEVER, that Consolidated Net Income shall not
include:
(a) the income (or loss) of any Person accrued prior to the date such
Person becomes a Subsidiary or is merged into or consolidated with the
Company or any of its Subsidiaries;
(b) the income (or loss) of any Person (other than a Subsidiary) in
which the Company or any of its Subsidiaries has an ownership interest;
PROVIDED, HOWEVER, that (i) Consolidated Net Income shall include amounts
in respect of the income of such Person when actually received in cash by
the Company or such Subsidiary in the form of dividends or similar
Distributions and (ii) Consolidated Net Income shall be reduced by the
aggregate amount of all Investments, regardless of the form thereof, made
by the Company or any of its Subsidiaries in such Person for the purpose of
funding any deficit or loss of such Person;
(c) all amounts included in computing such net income (or loss) in
respect of (i) the write-up of any asset on or after June 30, 1999 or (ii)
the retirement of any Indebtedness or equity at less than face value after
June 30, 1999;
(d) extraordinary and nonrecurring gains or losses;
(e) the income of any Subsidiary to the extent the payment of such
income in the form of a Distribution or repayment of Indebtedness to the
Company or a Wholly Owned Subsidiary is not permitted, whether on account
of any Charter or By-law restriction, any agreement, instrument, deed or
lease or any law, statute, judgment, decree or governmental order, rule or
regulation applicable to such Subsidiary; and
(6) any after-tax gains or losses attributable to returned surplus
assets of any Plan.
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"CONSOLIDATED NET WORTH" means, at any date, the total of:
(a) stockholders' equity of the Company and its Subsidiaries
determined in accordance with GAAP on a Consolidated basis, excluding the
effect of any foreign currency translation adjustments;
MINUS (b) the amount by which such stockholders' equity has been increased
after June 30, 1999 by the items excluded from Consolidated Net Income
pursuant to clauses (a) through (f) of the definition of Consolidated Net
Income;
MINUS (c) to the extent not already deducted from the amount in clause (a)
above, (i) treasury stock, (ii) receivables due from an employee stock
ownership plan and (iii) Guarantees of Indebtedness incurred by an employee
stock ownership plan.
"CONSOLIDATED PRO FORMA EBITDA" means, for any period, the sum of:
(a) Consolidated EBITDA;
PLUS (b) in the event during such period the Company or any of its
Subsidiaries makes an acquisition permitted by Section 6.9 (whether by
stock purchase, asset purchase, merger, consolidation or otherwise),
Consolidated EBITDA of such acquired Person (or acquired assets) accrued
during such period prior to the date of such acquisition; PROVIDED, in
determining the Consolidated EBITDA of such acquired Person (or acquired
assets) for such period, such Consolidated EBITDA will be adjusted as
follows: actions taken or anticipated to be taken by the Company and/or its
Subsidiaries prior to the first anniversary of the related acquisition date
(such as changes in compensation and other Affiliate payments) that result
in a cost savings with respect to such acquired Person (or acquired assets)
will be deemed to have been taken on the first day of such period for which
Consolidated EBITDA is being determined (with the intent that such cost
savings be effectively annualized by extrapolation from the demonstrated or
anticipated cost savings since the related acquisition date). Such
adjustments in such Consolidated EBITDA will be subject to the approval of
the Required Lenders, such approval not to be unreasonably withheld; and
MINUS (c) in the event during such period the Company or any of its
Subsidiaries disposes of any assets permitted by Section 6.11 (whether by
sale, merger, consolidation or otherwise), Consolidated EBITDA of such
disposed assets accrued during such period prior to the date of such
disposition.
"CONSOLIDATED PRO FORMA INTEREST EXPENSE" means, for any period, the sum
of:
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(a) Consolidated Interest Expense;
PLUS (b) in the event the Company or any of its Subsidiaries makes an
acquisition during such period, Consolidated Interest Expense deemed to
accrue on Indebtedness assumed or incurred as a result of such acquisition
from the beginning of such period to the date of such acquisition, which
deemed Consolidated Interest Expense shall be calculated by assuming that
(i) any Indebtedness assumed or incurred as a result of such acquisition
was assumed or incurred on the first day of such period and (ii) the
interest rate applicable to such Indebtedness prior to such acquisition was
the same as the interest rate applicable to such Indebtedness on the date
of such acquisition;
MINUS (c) in the event the Company or any of its Subsidiaries disposes of
any assets permitted by Section 6.11 (other than Sections 6.11.1 through
6.11.6) during such period, Consolidated Interest Expense accrued on any
Indebtedness repaid as a result of such disposition.
"CONSOLIDATED TOTAL DEBT" means, at any date, all Financing Debt of the
Company and its Subsidiaries on a Consolidated basis.
"CRANBERRY HILL CAPITAL" means Cranberry Hill Capital, LLC, a Delaware
limited liability company of which Nextera Business Performance Solutions, Inc.
is the sole member.
"CREDIT DOCUMENTS" means:
(a) this Agreement, the Notes, each Letter of Credit, each draft
presented or accepted under a Letter of Credit, the Guarantee and Security
Agreement, the Cash Management Agreement, the Subordination Agreement, the
fee agreement contemplated by Section 5.1.2 and each Hedge Agreement
provided by a Lender (or an Affiliate of a Lender) to the Company or any of
its Subsidiaries, each as from time to time in effect; and
(b) any other present or future agreement or instrument from time to
time entered into among the Company, any of its Subsidiaries or any other
Obligor, on one hand, and the Agent, any Letter of Credit Issuer or all the
Lenders, on the other hand, relating to, amending or modifying this
Agreement or any other Credit Document referred to above or which is stated
to be a Credit Document, each as from time to time in effect.
"CREDIT OBLIGATIONS" means all present and future liabilities, obligations
and Indebtedness of the Company, any of its Subsidiaries or any other Obligor
owing to the Agent or any Lender (or any Affiliate of a Lender) under or in
connection with this Agreement or any other Credit Document, including
obligations in respect of principal, interest, reimbursement
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obligations under Letters of Credit and Hedge Agreements provided by a Lender
(or an Affiliate of a Lender), commitment fees, Letter of Credit fees, amounts
provided for in Sections 3.2.4, 3.5 and 9 and other fees, charges, indemnities
and expenses from time to time owing hereunder or under any other Credit
Document (all whether accruing before or after a Bankruptcy Default and
regardless of whether allowed as a claim in bankruptcy or similar proceedings).
"CREDIT PARTICIPANT" is defined in Section 11.2.
"CREDIT REALLOCATION" means the election by the Company, upon seven Banking
Days prior written notice to the Agent at a time when no Default exists,
irrevocably to transfer unused availability from the revolving credit facility
in Section 2.1 to the acquisition credit facility in Section 2.2 (or from such
acquisition facility to such revolving credit facility); PROVIDED, HOWEVER, that
no more than $5,000,000 of unused availability may be transferred between such
credit facilities at any one time, and in no event shall such a transfer occur
more than twice in any year.
"CREDIT SECURITY" means all assets now or from time to time hereafter
subjected to a security interest, mortgage or charge (or intended or required so
to be subjected pursuant to the Guarantee and Security Agreement or any other
Credit Document) to secure the payment or performance of any of the Credit
Obligations on a pari passu basis, including the assets described in section 3.1
of the Guarantee and Security Agreement.
"CURRENCY EXCHANGE AGREEMENT" means any currency swap, foreign exchange
contract or similar arrangement providing for protection against fluctuations in
currency exchange rates, either generally or under specific contingencies.
"DEBENTURES" means the various debentures owed by the Company to certain
individuals and affiliates of Knowledge Enterprises, in the aggregate principal
amount of $30,001,000 as of the date hereof, all as amended and modified through
the date hereof and previously furnished to the Agent, with such subsequent
amendments and modifications as are entered into in accordance with Section
6.2.4.
"DEFAULT" means any Event of Default and any event or condition which with
the passage of time or giving of notice, or both, would become an Event of
Default, including the filing against the Company, any of its Subsidiaries or
any other Obligor of a petition commencing an involuntary case under the
Bankruptcy Code.
"DELINQUENCY PERIOD" is defined in Section 10.4.4.
"DELINQUENT PAYMENT" is defined in Section 10.4.4.
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"DISTRIBUTION" means, with respect to the Company (or other specified
Person):
(a) the declaration or payment of any dividend or distribution on or
in respect of any shares of any class of capital stock of or other equity
interests in the Company (or such specified Person);
(b) the purchase, redemption or other retirement for value of any
shares of any class of capital stock of or other equity interest in the
Company (or such specified Person) or any of its Subsidiaries, or of
options, warrants or other rights for the purchase of such shares,
directly, indirectly through a Subsidiary or corporate parent or otherwise;
(c) any other distribution on or in respect of any shares of any class
of capital stock of or equity or other beneficial interest in the Company
(or such specified Person);
(d) any payment of principal or interest with respect to, or any
purchase, redemption or defeasance of, any Financing Debt of the Company
(or such specified Person) or any of its Subsidiaries which by its terms or
the terms of any agreement is subordinated to the payment of the Credit
Obligations; and
(e) any payment, loan or advance by the Company (or such specified
Person) to, or any other Investment by the Company (or such specified
Person) in, the holder of any shares of any class of capital stock of or
equity interest in the Company (or such specified Person) or any of its
Subsidiaries, or any Affiliate of such holder (including the payment of
management and transaction fees and expenses);
PROVIDED, HOWEVER, that the term "Distribution" shall not include (i) dividends
payable in perpetual common stock of or other similar equity interests in the
Company (or such specified Person) or (ii) payments in the ordinary course of
business in respect of (A) reasonable compensation paid to employees, officers
and directors, (B) advances and reimbursements to employees for travel expenses,
drawing accounts, relocation costs and similar expenditures or (C) payments or
accounts payable, in each case for services rendered or goods sold by,
non-Affiliates that own capital stock of or other equity interests in the
Company (or such specified Person) or any of its Subsidiaries.
"DOMESTIC SUBSIDIARY" means any Subsidiary that is not a Foreign
Subsidiary.
"ELIGIBLE ASSIGNEE" means (a) a Lender, (b) an Affiliate of a Lender, (c) a
Related Fund and (d) subject to the prior approval of the Agent and, so long as
no Event of Default shall have occurred and be continuing, the Company, such
approval by the Agent and the Company not to be unreasonably withheld or
delayed:
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(i) a commercial bank organized under the laws of the United States of
America, or any state thereof, and having total assets in excess of
$500,000,000;
(ii) a savings and loan association or savings bank organized under
the laws of the United States of America, or any state thereof, and having
total assets in excess of $500,000,000;
(iii) a commercial bank organized under the laws of any other country
that is a member of the Organization for Economic Cooperation and
Development or has concluded special lending arrangements with the
International Monetary Fund associated with its General Arrangements to
Borrow or of the Cayman Islands, or a political subdivision of any such
country, and having total assets in excess of $500,000,000, so long as such
bank is acting through a branch or agency located in the United States of
America;
(iv) the central bank of any country that is a member of the
Organization for Economic Cooperation and Development; and
(v) a finance company, insurance company or other financial
institution or fund (whether a corporation, partnership, trust or other
entity) that is engaged in making, purchasing or otherwise investing in
commercial loans in the ordinary course of its business and having total
assets in excess of $500,000,000;
PROVIDED, HOWEVER, that (A) no Person shall qualify as an Eligible Assignee with
respect to assignments of obligations or Commitments in connection with Letters
of Credit unless such Person qualifies under clauses (d)(i) or (d)(iii) above
and (B) no Obligor or Affiliate of an Obligor shall qualify as an Eligible
Assignee under any circumstances.
"ENVIRONMENTAL LAWS" means all applicable federal, state or local statutes,
laws, ordinances, codes, rules, regulations and guidelines (including consent
decrees and administrative orders) relating to public health and safety and
protection of the environment, including the federal Occupational Health and
Safety Act.
"ERISA" means the federal Employee Retirement Income Security Act of 1974.
"ERISA GROUP PERSON" means the Company, any of its Subsidiaries and any
Person which is a member of the controlled group or under common control with
the Company or any of its Subsidiaries within the meaning of section 414 of the
Code or section 4001(a)(14) of ERISA.
"EVENT OF DEFAULT" is defined in Section 8.1.
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"EXCHANGE ACT" means the federal Securities Exchange Act of 1934.
"FEDERAL FUNDS RATE" means, for any day, the rate equal to the weighted
average (rounded upward to the nearest 1/16%) of (a) the rates on overnight
federal funds transactions with members of the Federal Reserve System arranged
by federal funds brokers, as such weighted average is published for such day
(or, if such day is not a Banking Day, for the immediately preceding Banking
Day) by the Federal Reserve Bank of New York or (b) if such rate is not so
published for such Banking Day, quotations received by the Agent from three
federal funds brokers of recognized standing selected by the Agent. Each
determination by the Agent of the Federal Funds Rate shall, in the absence of
manifest error, be conclusive.
"FINANCIAL OFFICER" of the Company (or other specified Person) means its
chief executive officer, chief financial officer, chief operating officer,
chairman, president, treasurer, controller or any of its vice presidents whose
primary responsibility is for its financial affairs, in each case whose
incumbency and signatures have been certified to the Agent by the secretary or
other appropriate attesting officer of the Company (or such specified Person).
"FINANCING DEBT" means each of the items described in clauses (a) through
(f) of the definition of the term "Indebtedness" and, without duplication, any
Guarantees of such items.
"FOREIGN SUBSIDIARY" means each Subsidiary that is organized under the laws
of, and conducting its business primarily in a jurisdiction outside of, the
United States of America and that is not domesticated or dually incorporated
under the laws of the United States of America or the states thereof.
"FUNDING LIABILITY" means (a) any LIBOR Deposit which was used (or deemed
by Section 3.2.6 to have been used) to fund any portion of the Loan subject to a
LIBOR Pricing Option, and (b) any portion of the Loan subject to a LIBOR Pricing
Option funded (or deemed by Section 3.2.6 to have been funded) with the proceeds
of any such LIBOR Deposit.
"GAAP" means generally accepted accounting principles as from time to time
in effect, including the statements and interpretations of the United States
Financial Accounting Standards Board; PROVIDED, HOWEVER, that (a) for purposes
of compliance with Section 6 (other than Section 6.4) and the related
definitions, "GAAP" means such principles as in effect on December 31, 1998 as
applied by the Company and its Subsidiaries in the preparation of the most
recent annual statements referred to in Section 7.2.1(a), and consistently
followed, without giving effect to any subsequent changes thereto and (b) in the
event of a change in generally accepted accounting principles after such date,
either the Company or the Required Lenders may request a change in the
definition of "GAAP", in which case the parties hereto
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shall negotiate in good faith with respect to an amendment of this Agreement
implementing such change.
"GUARANTEE" means, with respect to the Company (or other specified Person):
(a) any guarantee by the Company (or such specified Person) of the
payment or performance of, or any contingent obligation by the Company (or
such specified Person) in respect of, any Indebtedness or other obligation
of any primary obligor;
(b) any other arrangement whereby credit is extended to a primary
obligor on the basis of any promise or undertaking of the Company (or such
specified Person), including any binding "comfort letter" or "keep well
agreement" written by the Company (or such specified Person), to a creditor
or prospective creditor of such primary obligor, to (i) pay the
Indebtedness of such primary obligor, (ii) purchase an obligation owed by
such primary obligor, (iii) pay for the purchase or lease of assets or
services regardless of the actual delivery thereof or (iv) maintain the
capital, working capital, solvency or general financial condition of such
primary obligor;
(c) any liability of the Company (or such specified Person), as a
general partner of a partnership in respect of Indebtedness or other
obligations of such partnership;
(d) any liability of the Company (or such specified Person) as a joint
venturer of a joint venture in respect of Indebtedness or other obligations
of such joint venture;
(e) any liability of the Company (or such specified Person) with
respect to the tax liability of others as a member of a group (other than a
group consisting solely of the Company and its Subsidiaries) that is
consolidated for tax purposes; and
(f) reimbursement obligations, whether contingent or matured, of the
Company (or such specified Person) with respect to letters of credit,
bankers acceptances, surety bonds, other financial guarantees and Hedge
Agreements,
in each case whether or not any of the foregoing are reflected on the balance
sheet of the Company (or such specified Person) or in a footnote thereto;
PROVIDED, HOWEVER, that the term "Guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business. The amount of any
Guarantee and the amount of Indebtedness resulting from such Guarantee shall be
the maximum amount that the guarantor may become obligated to pay in respect of
the obligations (whether or not such obligations are outstanding at the time of
computation).
"GUARANTEE AND SECURITY AGREEMENT" is defined in Section 5.1.4.
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"GUARANTOR" means each of the Company's Subsidiaries party to, or which
subsequently becomes party to, the Guarantee and Security Agreement as a
Guarantor.
"HAZARDOUS MATERIAL" means any pollutant, toxic or hazardous material or
waste, including any "hazardous substance" or "pollutant" or "contaminant" as
defined in section 101(14) of CERCLA or any other Environmental Law or regulated
as toxic or hazardous under RCRA or any other Environmental Law.
"HEDGE AGREEMENTS" means, collectively, Currency Exchange Agreements and
Interest Rate Protection Agreements.
"IMMATERIAL SUBSIDIARY" means any Subsidiary whose assets (at fair market
value) do not exceed $100,000 and in which the net Investment of the Company and
its Subsidiaries is less than $100,000.
"INDEBTEDNESS" means all obligations, contingent or otherwise, which in
accordance with GAAP are required to be classified upon the balance sheet of the
Company (or other specified Person) as liabilities, but in any event including
(without duplication):
(a) borrowed money;
(b) indebtedness evidenced by notes, debentures or similar
instruments;
(c) Capitalized Lease Obligations;
(d) the deferred cash purchase price of assets, services or
securities, including related noncompetition, consulting and stock
repurchase obligations (other than ordinary trade accounts payable within
six months after the incurrence thereof in the ordinary course of
business);
(e) mandatory redemption or dividend rights on capital stock (or other
equity);
(f) reimbursement obligations, whether contingent or matured, with
respect to letters of credit, bankers acceptances, surety bonds, other
financial guarantees and Hedge Agreements (without duplication of other
Indebtedness supported or guaranteed thereby);
(g) unfunded pension liabilities;
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(h) obligations that are immediately and directly due and payable out
of the proceeds of or production from property;
(i) liabilities secured by any Lien existing on property owned or
acquired by the Company (or such specified Person), whether or not the
liability secured thereby shall have been assumed; and
(j) all Guarantees in respect of Indebtedness of others.
"INDEMNIFIED PARTY" is defined in Section 9.2.
"INITIAL CLOSING DATE" means December 30, 1999 or such other date prior to
January 1, 2000 agreed to by the Company and the Agent as the first Closing Date
hereunder.
"INTEREST RATE PROTECTION AGREEMENT" means any interest rate swap, interest
rate cap, interest rate hedge or other contractual arrangement that converts
variable interest rates into fixed interest rates, fixed interest rates into
variable interest rates or other similar arrangements.
"INVESTMENT" means, with respect to the Company (or other specified
Person):
(a) any share of capital stock, partnership or other equity interest,
evidence of Indebtedness or other security issued by any other Person;
(b) any loan, advance or extension of credit to, or contribution to
the capital of, any other Person;
(c) any Guarantee of the obligations of any other Person;
(d) any acquisition of all, or any division or similar operating unit
of, the business of any other Person or the assets comprising such
business, division or unit; and
(e) any other similar investment.
The investments described in the foregoing clauses (a) through (e) shall be
included in the term "Investment" whether they are made or acquired by purchase,
exchange, issuance of stock or other securities, merger, reorganization or any
other method; PROVIDED, HOWEVER, that the term "Investment" shall not include
(i) trade and customer accounts receivable for property leased, goods furnished
or services rendered in the ordinary course of business and payable within one
year in accordance with customary trade terms, (ii) deposits, advances or
prepayments to suppliers for property leased or licensed, goods furnished and
services rendered in the ordinary course of business, (iii) advances to
employees for relocation and
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travel expenses, drawing accounts and similar expenditures, (iv) stock or other
securities acquired in connection with the satisfaction or enforcement of
Indebtedness or claims or accounts receivable due to the Company (or such
specified Person) or as security for any such Indebtedness or claim or (v)
demand deposits in banks or similar financial institutions.
In determining the amount of outstanding Investments:
(A) the amount of any Investment shall be the cost thereof MINUS any
returns of capital in cash on such Investment (determined in accordance
with GAAP without regard to amounts realized as income on such Investment);
(B) the amount of any Investment in respect of a purchase described in
clause (d) above shall include the amount of any Financing Debt assumed in
connection with such purchase or secured by any asset acquired in such
purchase (whether or not any Financing Debt is assumed) or for which any
Person that becomes a Subsidiary is liable on the date on which the
securities of such Person are acquired; and
(C) no Investment shall be increased as the result of an increase in
the undistributed retained earnings of the Person in which the Investment
was made or decreased as a result of an equity interest in the losses of
such Person.
"ISP" is defined in Section 2.3.6.
"KNOWLEDGE ENTERPRISES" means Knowledge Enterprises, Inc., a Delaware
corporation.
"LEGAL REQUIREMENT" means any present or future requirement imposed upon
any of the Lenders or the Company and its Subsidiaries by any law, statute,
rule, regulation, directive, order, decree or guideline (or any interpretation
thereof by courts or of administrative bodies) of the United States of America,
or any jurisdiction in which any LIBOR Office is located or any state or
political subdivision of any of the foregoing, or by any board, governmental or
administrative agency, central bank or monetary authority of the United States
of America, any jurisdiction in which any LIBOR Office is located or where the
Company or any of its Subsidiaries owns property or conducts its business, or
any political subdivision of any of the foregoing. Any such law, statute, rule,
regulation, directive, order, decree, guideline or interpretation imposed on any
of the Lenders not having the force of law shall be deemed to be a Legal
Requirement for purposes of Section 3 if such Lender reasonably believes that
compliance therewith is customary commercial practice.
"LENDER" means each of the Persons listed as lenders on the signature page
hereto, including BankBoston and Bank of America, N.A., each in its capacity as
a Lender and such other Persons who may from time to time own a Percentage
Interest in the Credit Obligations, but the term "Lender" shall not include any
Credit Participant.
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"LENDING OFFICER" means such individuals whom the Agent may designate by
notice to the Company from time to time as an officer or employee who may
receive telephone requests for extensions of credit under Sections 2.1.3 and
2.3.2.
"LETTER OF CREDIT" is defined in Section 2.3.1.
"LETTER OF CREDIT EXPOSURE" means, at any date, the sum of (a) the
aggregate face amount of all drafts that may then or thereafter be presented by
beneficiaries under all Letters of Credit then outstanding, PLUS (b) the
aggregate face amount of all drafts that the Letter of Credit Issuer has
previously accepted under Letters of Credit but has not paid.
"LETTER OF CREDIT ISSUER" means, for any Letter of Credit, BankBoston or,
in the event BankBoston does not for any reason issue a requested Letter of
Credit, another Lender selected by the Company to issue such Letter of Credit.
"LIBOR BASIC RATE" means, for any LIBOR Interest Period, the rate of
interest at which LIBOR Deposits which have a term corresponding to such LIBOR
Interest Period are offered to the Agent by first class banks in the inter-bank
LIBOR market for delivery in immediately available funds at a LIBOR Office on
the first day of such LIBOR Interest Period as determined by the Agent at
approximately 11:00 a.m. (London time) two Banking Days prior to the date upon
which such LIBOR Interest Period is to commence (which determination by the
Agent shall, in the absence of manifest error, be conclusive).
"LIBOR DEPOSITS" means, with respect to any Lender, deposits of United
States Funds in a non-United States office or an international banking facility
of such Lender.
"LIBOR INTEREST PERIOD" means any period, selected as provided in Section
3.2.1, of one, two, three or six months, commencing on any Banking Day and
ending on the corresponding date in the subsequent calendar month so indicated
(or, if such subsequent calendar month has no corresponding date, on the last
day of such subsequent calendar month); PROVIDED, HOWEVER, that subject to
Section 3.2.3, if any LIBOR Interest Period so selected would otherwise begin or
end on a date which is not a Banking Day, such LIBOR Interest Period shall
instead begin or end, as the case may be, on the immediately preceding or
succeeding Banking Day as determined by the Agent in accordance with the then
current banking practice in the inter-bank LIBOR market with respect to LIBOR
Deposits at the applicable LIBOR Office, which determination by the Agent shall,
in the absence of manifest error, be conclusive.
"LIBOR OFFICE" means such non-United States office or international banking
facility of any Lender as such Lender may from time to time select.
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33
"LIBOR PRICING OPTIONS" means the options granted pursuant to Section 3.2.1
to have the interest on any portion of the Loan computed on the basis of a LIBOR
Rate.
"LIBOR RATE" for any LIBOR Interest Period means the rate, rounded upward
to the nearest 1/100%, obtained by dividing (a) the LIBOR Basic Rate for such
LIBOR Interest Period by (b) an amount equal to 1 MINUS the LIBOR Reserve Rate;
PROVIDED, HOWEVER, that if at any time during such LIBOR Interest Period the
LIBOR Reserve Rate applicable to any outstanding LIBOR Pricing Option changes,
the LIBOR Rate for such LIBOR Interest Period shall automatically be adjusted to
reflect such change, effective as of the date of such change to the extent
required by the Legal Requirement implementing such change.
"LIBOR RESERVE RATE" means the stated maximum rate (expressed as a decimal)
of all reserves (including any basic, supplemental, marginal or emergency
reserve or any reserve asset), if any, as from time to time in effect, required
by any Legal Requirement to be maintained by any Lender against (a)
"Eurocurrency liabilities" as specified in Regulation D of the Board of
Governors of the Federal Reserve System applicable to LIBOR Pricing Options or
(b) any other category of extensions of credit, or other assets, that includes
loans subject to a LIBOR Pricing Option by a non-United States office of any of
the Lenders to United States residents.
"LIEN" means, with respect to the Company (or any other specified Person):
(a) any lien, encumbrance, mortgage, pledge, charge or security
interest of any kind upon any property or assets of the Company (or such
specified Person), whether now owned or hereafter acquired, or upon the
income or profits therefrom;
(b) the acquisition of, or the agreement to acquire, any property or
asset upon conditional sale or subject to any other title retention
agreement, device or arrangement (including a Capitalized Lease);
(c) the sale, assignment, pledge or transfer for security of any
accounts, general intangibles or chattel paper of the Company (or such
specified Person), with or without recourse;
(d) the transfer of any tangible property or assets for the purpose of
subjecting such items to the payment of previously outstanding Indebtedness
in priority to payment of the general creditors of the Company (or such
specified Person); and
(e) the existence for a period of more than 120 consecutive days of
any Indebtedness against the Company (or such specified Person) which if
unpaid would by law or upon a Bankruptcy Default be given any priority over
general creditors.
"LOAN" means, collectively, the Revolving Loan and the Acquisition Loan.
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"MARGIN STOCK" means "margin stock" within the meaning of Regulations T, U
or X of the Board of Governors of the Federal Reserve System.
"MATERIAL ADVERSE CHANGE" means, since any specified date or from the
circumstances existing immediately prior to the happening of any specified
event, a material adverse change in (a) the business, assets, financial
condition, income or prospects of the Company and its Subsidiaries (on a
Consolidated basis), whether as a result of (i) general economic conditions
affecting the business consulting industry, (ii) fire, flood or other natural
calamities, (iii) regulatory changes, judicial decisions, war or other
governmental action or (iv) any other event or development, whether or not
related to those enumerated above or (b) the ability of the Obligors to perform
their obligations under the Credit Documents or (c) the rights and remedies of
the Agent and the Lenders under the Credit Documents.
"MATERIAL AGREEMENTS" is defined in Section 7.2.2.
"MATERIAL FINANCING DEBT" means any Financing Debt (other than the Credit
Obligations and, so long as the Subordination Agreement is in full force and
effect, the Debentures) outstanding in an aggregate amount of principal (whether
or not due) and accrued interest exceeding $500,000.
"MATURITY DATE" means March 29, 2002 (which Maturity Date may be extended
as provided in Section 2.5).
"MAXIMUM AMOUNT OF ACQUISITION CREDIT" is defined in Section 2.2.2.
"MAXIMUM AMOUNT OF REVOLVING CREDIT" is defined in Section 2.1.2.
"MOODY'S" means Xxxxx'x Investors Service, Inc.
"MULTIEMPLOYER PLAN" means any Plan that is a "multiemployer plan" as
defined in section 4001(a)(3) of ERISA.
"NET ASSET SALE PROCEEDS" means the cash proceeds of the sale or
disposition of assets (including by way of merger), and the cash proceeds of any
insurance payments on account of the destruction or loss of property, by the
Company or any of its Subsidiaries after the Initial Closing Date, net of (a)
any Indebtedness permitted by Section 6.6.7 (purchase money Indebtedness and
Capitalized Leases) secured by assets being sold in such transaction required to
be paid from such proceeds, (b) income taxes that, as estimated by the Company
in good faith, will be required to be paid by the Company or any of its
Subsidiaries in cash as a result of, and within 16 months after, such sale or
disposition, (c) reasonable reserves for liabilities, indemnities, escrows and
purchase price adjustments resulting from the sale of assets and (d) all
reasonable expenses of the Company or any of its Subsidiaries payable in
connection with
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the sale or disposition; PROVIDED, HOWEVER, that "Net Asset Sale Proceeds" shall
not include cash proceeds:
(i) of asset sales permitted by Section 6.11.1, 6.11.6 or 6.11.7,
(ii) to the extent not covered in clause (i) above, of mergers
permitted by Section 6.11.2,
(iii) that will be used to acquire replacement or other assets within
180 days after such sale, disposition, destruction or loss; PROVIDED,
HOWEVER, that if any amount in this clause (iii) is not actually used to
acquire replacement or other assets within such 180-day period, such amount
shall become Net Asset Sale Proceeds,
(iv) of licensing or leasing of assets permitted by Section 6.11.3, or
(v) of the liquidation or other disposition of Cranberry Hill Capital.
"NET DEBT PROCEEDS" means cash proceeds (net of reasonable out-of-pocket
transaction fees and expenses) from the incurrence by the Company or any of its
Subsidiaries after the Initial Closing Date of Financing Debt other than
Financing Debt permitted by Sections 6.6.1 (the Loan), 6.6.7 (purchase money
Indebtedness and Capitalized Leases), 6.6.9 (intercompany Indebtedness) and
6.6.13 (Foreign Subsidiary Indebtedness).
"NET EQUITY PROCEEDS" means the cash proceeds (net of reasonable
out-of-pocket fees and expenses) received by the Company or any of its
Subsidiaries in connection with any issuance by the Company or any of its
Subsidiaries after the Initial Closing Date of any shares of its capital stock,
other equity interests or options, warrants or other purchase rights to acquire
such capital stock or other equity interests to, or receipt of a capital
contribution from, any Person (other than any Obligors or their officers,
employees and directors); PROVIDED, HOWEVER, that Net Equity Proceeds shall
exclude all cash proceeds derived from any exercises under the Company's stock
option plans and employee stock purchase plans.
"NONPERFORMING LENDER" is defined in Section 10.4.4.
"NOTES" means, collectively, the Revolving Notes and the Acquisition Notes.
"OBLIGOR" means the Company, each Guarantor and each other Person
guaranteeing or providing collateral for the Credit Obligations.
"OVERDUE REIMBURSEMENT RATE" means, at any date, the highest Applicable
Rate then in effect.
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"PAYMENT DATE" means (a) the last Banking Day of each March, June,
September and December, beginning on the first such date after the date hereof
and (b) the Maturity Date.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
entity.
"PERCENTAGE INTEREST" means, with respect to any Lender, the Commitment of
such Lender with respect to the respective portions of the Loan and Letter of
Credit Exposure. For purposes of determining votes or consents by the Lenders,
the Percentage Interest of any Lender shall be computed as follows: (a) at all
times when no Event of Default under Section 8.1.1 and no Bankruptcy Default
exists, the ratio that the respective Commitments of such Lender bears to the
total Commitments of all Lenders as from time to time in effect and reflected in
the Register, and (b) at all other times, the ratio that the respective amounts
of the outstanding Loan and Letter of Credit Exposure owing to such Lender bear
to the total outstanding Loan and Letter of Credit Exposure owing to all
Lenders.
"PERFORMING LENDER" is defined in Section 10.4.4.
"PERSON" means any present or future natural person or any corporation,
association, partnership, joint venture, limited liability, joint stock or other
company, business trust, trust, organization, business or government or any
governmental agency or political subdivision thereof.
"PIK INTEREST" means any accrued interest payments on Financing Debt that
are postponed or made through the issuance of "payment-in-kind" notes or other
similar securities (including book-entry accrual with respect to such postponed
interest payments), all in accordance with the terms of such Financing Debt;
PROVIDED, HOWEVER, that in no event shall PIK Interest include payments made
with cash or Cash Equivalents.
"PLAN" means, at any date, any pension benefit plan subject to Title IV of
ERISA maintained, or to which contributions have been made or are required to be
made, by any ERISA Group Person within six years prior to such date.
"PRIOR CREDIT AGREEMENT" means the Discretionary Demand Credit Agreement
dated as of June 26, 1999, as from time to time in effect, among the Company,
its Domestic Subsidiaries and BankBoston.
"PROSPECTUS" is defined in Section 7.2.1.
"RCRA" means the federal Resource Conservation and Recovery Act, 42 U.S.C.
section 690, ET SEQ.
"REFERENCE LEVERAGE RATIO" means, on any date, the ratio of (a)
Consolidated Total Debt as of the end of the most recent period of four
consecutive fiscal quarters for which
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financial statements have been furnished to the Lenders in accordance with
Sections 6.4.1 and 6.4.2 prior to such date to (b) Consolidated Pro Forma EBITDA
for such period.
"REGISTER" is defined in Section 11.1.3.
"RELATED FUND" means, with respect to any Lender that is a fund that
invests in senior bank loans, any other fund that invests in senior bank loans
and is managed by the same investment advisor as such Lender or by an Affiliate
of such investment advisor.
"REPLACEMENT LENDER" is defined in Section 11.3.
"REQUIRED LENDERS" means, with respect to any approval, consent,
modification, waiver or other action to be taken by the Agent or the Lenders
under the Credit Documents which require action by the Required Lenders, such
Lenders as own at least a majority of the Percentage Interests; PROVIDED,
HOWEVER, that with respect to any matters referred to in the proviso to Section
15.1, Required Lenders means such Lenders as own at least the respective
portions of the Percentage Interests required by Section 15.1.
"REVOLVING LOAN" is defined in Section 2.1.4.
"REVOLVING NOTES" is defined in Section 2.1.4.
"S&P" means Standard & Poor's, a division of The McGraw Hill Companies,
Inc.
"SECURITIES ACT" means the federal Securities Act of 1933.
"SETTLEMENT" means the making or receiving of payments, in immediately
available funds, by the Lenders to the extent necessary to cause each Lender's
actual share of the Revolving Loan to be equal to such Lender's Percentage
Interest with respect to the Revolving Loan, in the event that, prior to such
making or receiving of payments, the actual share is not so equal.
"SETTLEMENT AMOUNT" is defined in Section 2.6.
"SETTLEMENT DATE" means the first Banking Day in each calendar week and
each Payment Date.
"SIBSON CANADA" means Sibson Canada Co., a corporation formed under the
laws of Canada.
"SUBORDINATION AGREEMENT" is defined in Section 5.1.6.
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"SUBSIDIARY" means any Person of which the Company (or other specified
Person) shall at the time, directly or indirectly through one or more of its
Subsidiaries, (a) own at least 50% of the outstanding capital stock (or other
shares of beneficial interest) entitled to vote generally, (b) hold at least 50%
of the partnership, joint venture or similar interests or (c) be a general
partner or joint venturer and hold at least 50% of the general partner or joint
venturer interests, as the case may be.
"SYNDICATION AGENT" means Banc of America Securities LLC, a Delaware
limited liability company .
"TAX" means any present or future tax, levy, duty, impost, deduction,
withholding or other charges of whatever nature at any time required by any
Legal Requirement (a) to be paid by any Lender or (b) to be withheld or deducted
from any payment otherwise required hereby to be made to any Lender, in each
case on or with respect to its obligations hereunder, from the Loan, any payment
in respect of the Credit Obligations or any Funding Liability not included in
the foregoing; PROVIDED, HOWEVER, that the term "Tax" shall not include taxes
imposed upon or measured by the net income of such Lender or franchise taxes
that are imposed in lieu of net income taxes; PROVIDED, FURTHER, HOWEVER, that
the term "Tax" shall include withholding taxes in any event.
"UCP" is defined in Section 2.3.6.
"UNITED STATES FUNDS" means such coin or currency of the United States of
America as at the time shall be legal tender therein for the payment of public
and private debts.
"WHOLLY OWNED SUBSIDIARY" means any Subsidiary of which all of the
outstanding capital stock (or other shares of beneficial interest) entitled to
vote generally (other than directors' qualifying shares and, in the case of
Foreign Subsidiaries, shares required by Legal Requirements to be held by
foreign nationals) is owned by the Company (or other specified Person) directly,
or indirectly through one or more Wholly Owned Subsidiaries; PROVIDED, HOWEVER,
that Sibson Canada shall be considered a "Wholly Owned Subsidiary" so long as
the Company owns at least 99% of the outstanding equity of Sibson Canada.
2. THE CREDITS.
2.1. REVOLVING CREDIT.
2.1.1. REVOLVING LOAN. Subject to all the terms and conditions of this
Agreement and so long as no Default exists, from time to time on and after
the Initial Closing Date and prior to the Maturity Date the Lenders will,
severally in accordance with their respective Commitments in the Revolving
Loan, make loans to the Company in such amounts as may be requested by the
Company in accordance with
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Section 2.1.3. The sum of the aggregate principal amount of loans made
under this Section 2.1.1 at any one time outstanding (including loans made
in accordance with the Cash Management Agreement) PLUS the Letter of Credit
Exposure shall in no event exceed the Maximum Amount of Revolving Credit.
In no event will the principal amount of loans at any one time outstanding
made by any Lender pursuant to this Section 2.1, together with such
Lender's Percentage Interest in the Letter of Credit Exposure, exceed such
Lender's Commitment with respect to the Revolving Loan.
2.1.2. MAXIMUM AMOUNT OF REVOLVING CREDIT. The term "MAXIMUM AMOUNT OF
REVOLVING CREDIT" means the lesser of:
(a) the total of (i) $15,000,000 MINUS (ii) any Net Asset Sale
Proceeds described in Section 4.2.2 and Net Debt Proceeds described in
Section 4.2.3, in each case to the extent allocable to the Revolving
Loan in accordance with Section 4.5.2, PLUS (iii) any Credit
Reallocation from the Maximum Amount of Acquisition Credit to the
Maximum Amount of Revolving Credit, MINUS (iv) any Credit Reallocation
from the Maximum Amount of Revolving Credit to the Maximum Amount of
Acquisition Credit, or
(b) the amount to which the then applicable amount set forth in
clause (a) hereof shall have been irrevocably reduced from time to
time by seven Banking Days notice from the Company to the Agent (the
minimum aggregate amount of which reduction shall be $5,000,000 and
integral multiples of $1,000,000 in excess thereof).
2.1.3. BORROWING REQUESTS. Except as otherwise provided in the Cash
Management Agreement for net daily loans not exceeding $2,500,000 in
principal amount made in accordance therewith, the Company may from time to
time request a loan under Section 2.1.1 by providing to the Agent a notice
(which may be given by a telephone call received by a Lending Officer if
promptly confirmed in writing). Such notice must be not later than noon
(Boston time) on the first Banking Day (third Banking Day if any portion of
such loan will be subject to a LIBOR Pricing Option on the requested
Closing Date) prior to the requested Closing Date for such loan. The notice
must specify (a) the amount of the requested loan (which shall be not less
than $1,000,000 and an integral multiple of $500,000, except as otherwise
provided in the Cash Management Agreement) and (b) the requested Closing
Date therefor, which shall be a Banking Day. Upon receipt of such notice,
the Agent will promptly inform each other Lender (by telephone or
otherwise). Each such loan will be made at the Boston Office by depositing
the amount thereof to the general account of the Company with the Agent. In
connection with each such loan, the Company shall furnish to the Agent a
certificate in substantially the form of Exhibit 5.2.1.
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2.1.4. REVOLVING NOTES. The aggregate principal amount of the loans
outstanding from time to time under this Section 2.1 (including loans made
in accordance with the Cash Management Agreement) is referred to as the
"REVOLVING LOAN". The Agent shall keep a record of the Revolving Loan and
the respective interests of the Lenders therein as part of the Register,
which shall evidence the Revolving Loan. The Revolving Loan shall be deemed
owed to each Lender having a Commitment therein severally in accordance
with such Lender's Percentage Interest therein, and all payments thereon
shall be for the account of each Lender in accordance with its Percentage
Interest therein. Upon written request of any Lender, the Company's
obligations to pay such Lender's Percentage Interest in the Revolving Loan
shall be further evidenced by a separate note of the Company in
substantially the form of Exhibit 2.1.4 (the "REVOLVING NOTES"), payable to
such Lender in accordance with such Lender's Percentage Interest in the
Revolving Loan.
2.2. ACQUISITION CREDIT.
2.2.1. ACQUISITION LOAN. Subject to all the terms and conditions of
this Agreement and so long as no Default exists, from time to time on and
after the Initial Closing Date and prior to the Maturity Date the Lenders
will, severally in accordance with their respective Commitments in the
Acquisition Loan, make loans to the Company in such amounts as may be
requested by the Company in accordance with Section 2.2.3 for the purpose
of funding all or a portion of an acquisition permitted by Section 6.9
(whether requested in connection with the closing of such an acquisition or
to fund future payments by the Company (i.e., that become due and owing by
the Company after the closing of such an acquisition) related to such an
acquisition) (or, on the Initial Closing Date, refinancing the Prior Credit
Agreement). The sum of the aggregate principal amount of loans made under
this Section 2.2.1 at any one time outstanding shall in no event exceed the
Maximum Amount of Acquisition Credit. In no event will the principal amount
of loans at any one time outstanding made by any Lender pursuant to this
Section 2.2 exceed such Lender's Commitment with respect to the Acquisition
Loan.
2.2.2. MAXIMUM AMOUNT OF ACQUISITION CREDIT. The term "MAXIMUM AMOUNT
OF ACQUISITION CREDIT" means the lesser of:
(a) the total of (i) $40,000,000 MINUS (ii) any Net Asset Sale
Proceeds described in Section 4.2.2 and Net Debt Proceeds described in
Section 4.2.3, in each case to the extent allocable to the Acquisition
Loan in accordance with Section 4.5.2, PLUS (iii) any Credit
Reallocation from the Maximum Amount of Revolving Credit to the
Maximum Amount of Acquisition Credit, MINUS (iv) any Credit
Reallocation from the Maximum
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Amount of Acquisition Credit to the Maximum Amount of Revolving
Credit, or
(b) the amount to which the then applicable amount set forth in
clause (a) hereof shall have been irrevocably reduced from time to
time by seven Banking Days notice from the Company to the Agent (the
minimum aggregate amount of which reduction shall be $5,000,000 and
integral multiples of $1,000,000 thereof).
2.2.3. BORROWING REQUESTS. The Company may from time to time request a
loan under this Section 2.2 by providing to the Agent a written notice in
accordance with Section 2.2.1. Such notice must be not later than noon
(Boston time) on the first Banking Day (third Banking Day if any portion of
such loan will be subject to a LIBOR Pricing Option on the requested
Closing Date) prior to the requested Closing Date for such loan. The notice
must specify (a) the amount of the requested loan (which shall not be less
than $500,000) and (b) the requested Closing Date therefor, which shall be
a Banking Day. Upon receipt of such notice, the Agent will promptly inform
each other Lender (by telephone or otherwise). Each such loan will be made
at the Boston Office by depositing the amount thereof to the general
account of the Company with the Agent or by wire transfer as the Company
may direct in writing to the Agent. In connection with each such loan, the
Company shall furnish to the Agent a certificate in substantially the form
of Exhibit 5.2.1 and any additional information the Agent or any Lender
shall reasonably request.
2.2.4. ACQUISITION NOTES. The aggregate principal amount of the loans
outstanding from time to time under this Section 2.2 is referred to as the
"ACQUISITION LOAN". The Agent shall keep a record of the Acquisition Loan
and the interests of the respective Lenders therein as part of the
Register, which shall evidence the Acquisition Loan. The Acquisition Loan
shall be deemed owed to each Lender having a Commitment therein severally
in accordance with such Lender's Percentage Interest therein, and all
payments thereon shall be for the account of each Lender in accordance with
its Percentage Interest therein. Upon request of any Lender, the Company's
obligations to pay such Lender's Percentage Interest in the Acquisition
Loan shall be evidenced by a separate note of the Company in substantially
the form of Exhibit 2.2.4 (the "ACQUISITION NOTES"), payable to such Lender
in accordance with such Lender's Percentage Interest in the Acquisition
Loan.
2.3. LETTERS OF CREDIT.
2.3.1. ISSUANCE OF LETTERS OF CREDIT. Subject to all the terms and
conditions of this Agreement and so long as no Default exists, from time to
time on and after the Initial Closing Date and prior to the date five
Banking Days preceding the Maturity
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Date, the Letter of Credit Issuer will issue for the account of the Company
one or more irrevocable documentary or standby letters of credit (the
"LETTERS OF CREDIT"). In addition, letters of credit having Letter of
Credit Exposure not exceeding $4,000,000 issued under the Prior Credit
Agreement shall be automatically deemed to be Letters of Credit issued
under this Section 2.3. The sum of Letter of Credit Exposure PLUS the
Revolving Loan shall in no event exceed the Maximum Amount of Revolving
Credit. Letter of Credit Exposure shall in no event exceed $7,500,000.
2.3.2. REQUESTS FOR LETTERS OF CREDIT. The Company may from time to
time request a Letter of Credit to be issued by providing to the Letter of
Credit Issuer (and the Agent if the Letter of Credit Issuer is not the
Agent) a notice which is actually received not less than three Banking Days
(for standby Letters of Credit) and one Banking Day (for documentary
Letters of Credit) prior to the requested Closing Date for such Letter of
Credit specifying (a) the amount of the requested Letter of Credit, (b) the
beneficiary thereof, (c) the requested Closing Date and (d) a summary of
the principal terms of the text for such Letter of Credit, together with
any customary application forms required by the Letter of Credit Issuer. In
the event of any inconsistency between such application forms and this
Agreement, this Agreement shall govern. Each Letter of Credit will be
issued by forwarding it to the Company or to such other Person as directed
in writing by the Company. In connection with the issuance of any Letter of
Credit, the Company shall furnish to the Letter of Credit Issuer (and the
Agent if the Letter of Credit Issuer is not the Agent) a certificate in
substantially the form of Exhibit 5.2.1.
2.3.3. FORM AND EXPIRATION OF LETTERS OF CREDIT. Each Letter of Credit
issued under this Section 2.3 and each draft accepted or paid under such a
Letter of Credit shall be issued, accepted or paid, as the case may be, by
the Letter of Credit Issuer at its principal office. No Letter of Credit
shall provide for the payment of drafts drawn thereunder, and no draft
shall be payable, at a date which is later than the earlier of (a) the date
12 months after the date of issuance (which expiration date may be extended
at the option of the Letter of Credit Issuer for additional 12-month
periods ending prior to the date referred to in clause (b) below) or (b)
five Banking Days prior to the Maturity Date. Each Letter of Credit and
each draft accepted under a Letter of Credit shall be in such form and
shall contain such terms as is generally acceptable in the industry for
which such Letter of Credit is being requested and shall be in such amount
as the Letter of Credit Issuer and the Company may agree upon at the time
such Letter of Credit is issued.
2.3.4. LENDERS' PARTICIPATION IN LETTERS OF CREDIT. Upon the issuance
of any Letter of Credit, a participation therein, in an amount equal to
each Lender's Percentage Interest in the Revolving Loan, shall
automatically be deemed granted by the Letter of Credit Issuer to each such
Lender on the date of such issuance and such
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Lenders shall automatically be obligated, as set forth in Section 10.4, to
reimburse the Letter of Credit Issuer to the extent of their respective
Percentage Interests in the Revolving Loan for all obligations incurred by
the Letter of Credit Issuer to third parties in respect of such Letter of
Credit not reimbursed by the Company. The Letter of Credit Issuer will send
to each Lender (and the Agent if the Letter of Credit Issuer is not the
Agent) a confirmation regarding the participations in Letters of Credit
outstanding during such month.
2.3.5. REIMBURSEMENT OF PAYMENT. At such time as a Letter of Credit
Issuer makes any payment on a draft presented or accepted under a Letter of
Credit, the amount of such payment shall be considered a loan under Section
2.1.1 (regardless of whether the conditions set forth in Section 5.2 are
satisfied) and part of the Revolving Loan as if the Company had paid in
full the amount required with respect to the Letter of Credit by borrowing
such amount under Section 2.1.1, except as provided below. In the event
such amount would cause the Revolving Loan to exceed the Maximum Amount of
Revolving Credit or if during the existence of an Event of Default the
Agent has previously provided written notice to the Company that Letter of
Credit payments will no longer be considered loans under Section 2.1.1, the
Company will on demand pay to the Agent in immediately available funds the
amount of such payment.
2.3.6. UCP; ISP. As to any Letter of Credit that is a documentary
letter of credit, the most recent Uniform Customs and Practice for
Documentary Credits adopted by a Congress of the International Chamber of
Commerce, and any subsequent revisions thereof approved by a Congress of
the International Chamber of Commerce and adhered to by the Letter of
Credit Issuer (the "UCP"), shall be binding on the Company and the Letter
of Credit Issuer except to the extent otherwise provided herein, in any
Letter of Credit or in any other Credit Document. As to any Letter of
Credit that is a standby letter of credit, the most recent International
Standby Practices adopted by a Congress of the International Chamber of
Commerce, and any subsequent revisions thereof approved by a Congress of
the International Chamber of Commerce and adhered to by the Letter of
Credit Issuer (the "ISP"), shall be binding on the Company and the Letter
of Credit Issuer except to the extent otherwise provided herein, in any
Letter of Credit or in any other Credit Document. Without limiting the
foregoing, in the event of an unexpected closure of the Letter of Credit
Issuer Letter of Credit draws may be made up to only two Banking Days after
the reopening of the Letter of Credit Issuer rather than the 30 day period
provided in Rule 3.14(a) of the ISP. Anything in the UCP or the ISP to the
contrary notwithstanding:
(1) With respect to each Letter of Credit, neither the Letter of
Credit Issuer nor its correspondents shall be responsible for or shall have
any duty to ascertain (unless the Letter of Credit Issuer or such
correspondent is grossly negligent or willful in failing so to ascertain):
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(1) the genuineness of any signature or the validity, form,
sufficiency, accuracy, genuineness or legal effect of any
endorsements;
(2) delay in giving, or failure to give, notice of arrival,
notice of refusal of documents or of discrepancies in respect of which
any Letter of Credit Issuer refuses the documents or any other notice,
demand or protest;
(3) the performance by any beneficiary under any Letter of Credit
of such beneficiary's obligations to the Company;
(4) inaccuracy in any notice received by the Letter of Credit
Issuer;
(5) the validity, form, sufficiency, accuracy, genuineness or
legal effect of any instrument, draft, certificate or other document
required by such Letter of Credit to be presented before payment of a
draft if such instrument, draft, certificate or other document appears
on its face to comply with the requirements of the Letter of Credit,
or the office held by or the authority of any Person signing any of
the same; or
(6) failure of any instrument to bear any reference or adequate
reference to such Letter of Credit, or failure of any Person to note
the amount of any instrument on the reverse of such Letter of Credit
or to surrender such Letter of Credit or to forward documents in the
manner required by such Letter of Credit.
(2) The occurrence of any of the events referred to in the UCP or the
ISP or in the preceding clauses of this Section 2.3.6 shall not affect or
prevent the vesting of any of the Letter of Credit Issuer's rights or
powers hereunder or the Company's obligation to make reimbursement (whether
by cash payment or by refinancing with advances under the Revolving Loan in
accordance with Section 2.3.5) of amounts paid under any Letter of Credit
or any draft accepted thereunder.
(3) In the event of any conflict between the provisions of this
Agreement and either the UCP or the ISP, the provisions of this Agreement
shall govern.
2.3.7. SUBROGATION. Upon any payment by a Letter of Credit Issuer
under any Letter of Credit and until the reimbursement of such Letter of
Credit Issuer by the Company with respect to such payment (whether by cash
payment or by refinancing with advances under the Revolving Loan in
accordance with Section 2.3.5), the Letter of Credit Issuer shall be
entitled to be subrogated to, and to acquire and retain, the
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rights which the Person to whom such payment is made may have against the
Company, all for the benefit of the Lenders. The Company will take such
action as the Letter of Credit Issuer may reasonably request, including
requiring the beneficiary of any Letter of Credit to execute such documents
as the Letter of Credit Issuer may reasonably request, to assure and
confirm to the Letter of Credit Issuer such subrogation and such rights,
including the rights, if any, of the beneficiary to whom such payment is
made in accounts receivable, inventory and other properties and assets of
any Obligor.
2.3.8. MODIFICATION, CONSENT, ETC. If the Company requests or consents
in writing to any modification or extension of any Letter of Credit, or
waives any failure of any draft, certificate or other document to comply
with the terms of such Letter of Credit, the Letter of Credit Issuer shall
be entitled to rely on such request, consent or waiver. This Agreement
shall be binding upon the Company with respect to such Letter of Credit as
so modified or extended, and with respect to any action taken or omitted by
such Letter of Credit Issuer pursuant to any such request, consent or
waiver.
2.4. APPLICATION OF PROCEEDS.
2.4.1. REVOLVING LOAN. Subject to Section 2.4.4, the Company will
apply the proceeds of the Revolving Loan for working capital, capital
expenditures and other lawful corporate purposes of the Company and its
Subsidiaries.
2.4.2. ACQUISITION LOAN. The Company will apply the proceeds of the
Acquisition Loan to fund all or a portion of acquisitions permitted by
Section 6.9 (whether through stock purchase, asset purchase, merger or
consolidation), including the repayment of related Indebtedness of the
acquired entity that will not be assumed by the Company and its
Subsidiaries, and to pay the related transaction fees and expenses. In
addition, on the Initial Closing Date the Company may apply the proceeds of
the Acquisition Loan to refinance the Prior Credit Agreement.
2.4.3. LETTERS OF CREDIT. Letters of Credit shall be issued only for
such lawful corporate purposes as the Company has requested in writing and
to which the Letter of Credit Issuer agrees, which agreement shall not be
unreasonably withheld.
2.4.4. SPECIFICALLY PROHIBITED APPLICATIONS. The Company will not,
directly or indirectly, apply any part of the proceeds of any extension of
credit made pursuant to the Credit Documents to purchase or to carry Margin
Stock or to any transaction prohibited by the Credit Documents or by Legal
Requirements applicable to the Lenders.
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2.5. OPTION TO EXTEND MATURITIES OF CREDITS. So long as no Default exists,
the Company may request, by notice to the Lenders at least 90 days and not more
than 120 days prior to the Maturity Date, that the Maturity Date be extended for
an additional period not longer than 12 months, but in no event to a date later
than March 29, 2003. The Lenders shall consider such request in their sole
discretion, and may propose additional terms, including any changes in the
interest rates, as a condition to any extension. The Lenders shall provide a
written response to the Borrower not later than 45 days after receipt of such
request. In no event shall the Maturity Date be extended hereunder without the
consent of each of the Lenders (giving effect to any Replacement Lender under
Section 11.3). In the event the Lenders offer to extend the Maturity Date
pursuant to this Section 2.5, the Company may accept such offer by written
notice received by the Agent not later than 30 days after receipt by the Company
of such offer.
2.6. SETTLEMENT UNDER THE CASH MANAGEMENT AGREEMENT. On each Settlement
Date, the Agent shall, not later than 11:00 a.m. (Boston time), give telephonic
or facsimile notice (a) to the Lenders and the Company of the net outstanding
amount of loans made, or the net amount of repayments of the Revolving Loan
received, as the case may be, by the Agent on behalf of the Lenders under the
Cash Management Agreement since the immediately preceding Settlement Date
through the close of business on the prior Banking Day and (b) to the Lenders of
the amount (a "SETTLEMENT AMOUNT") that each Lender shall pay or receive, as the
case may be, to effect a Settlement of the Revolving Loan. A statement of the
Agent submitted to the Lenders and the Company with respect to any amounts owing
under this Section 2.6 shall be prima facie evidence of the amount due and
owing. Each Lender shall, not later than 3:00 p.m. (Boston time) on such
Settlement Date, send to or receive from the Agent, as the case may be, a wire
transfer of immediately available funds in the amount of the Settlement Amount
for such Lender. All funds advanced by any Lender pursuant to this Section 2.6
shall for all purposes be treated as an advance under the Revolving Loan made by
such Lender to the Company and all funds received by any Lender pursuant to this
Section 2.6 shall for all purposes be treated as repayment of the Revolving Loan
made to such Lender. In the event that any bankruptcy, reorganization,
liquidation, receivership or similar case or proceeding in which the Company is
a debtor prevents a Lender from making any advance under the Revolving Loan to
effect a Settlement as contemplated hereby, such Lender will make such
dispositions and arrangements with the other Lenders with respect to such
advance under the Revolving Loan, either by way of purchase of participations,
distribution, assignment of claims, subrogation or otherwise, as shall result in
each Lender's share of the outstanding Revolving Loan being equal, as nearly
practicable, to such Lender's Percentage Interest in the Revolving Loan.
3. INTEREST; LIBOR PRICING OPTIONS; FEES.
3.1. INTEREST. The Loan shall accrue and bear interest at a rate per annum
which shall at all times equal the Applicable Rate. Prior to any stated or
accelerated maturity of the
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Loan, the Company will, on each Payment Date, pay the accrued and unpaid
interest on the portion of the Loan which was not subject to a LIBOR Pricing
Option. On the last day of each LIBOR Interest Period or on any earlier
termination of any LIBOR Pricing Option, the Company will pay the accrued and
unpaid interest on the portion of the Loan which was subject to the LIBOR
Pricing Option which expired or terminated on such date. In the case of any
LIBOR Interest Period longer than three months, the Company will also pay the
accrued and unpaid interest on the portion of the Loan subject to the LIBOR
Pricing Option having such LIBOR Interest Period at three-month intervals, the
first such payment to be made on the last Banking Day of the three-month period
which begins on the first day of such LIBOR Interest Period. On the stated or
any accelerated maturity of the Loan, the Company will pay all accrued and
unpaid interest on the Loan, including any accrued and unpaid interest on any
portion of the Loan which is subject to a LIBOR Pricing Option. Upon the
occurrence and during the continuance of an Event of Default, the Lenders may
require accrued interest to be payable on demand or at regular intervals more
frequent than each Payment Date. All payments of interest hereunder shall be
made to the Agent for the account of each Lender in accordance with such
Lender's Percentage Interest therein.
3.2. LIBOR PRICING OPTIONS.
3.2.1. ELECTION OF LIBOR PRICING OPTIONS. Subject to all of the terms
and conditions hereof and so long as no Default exists, the Company may
from time to time, by irrevocable notice to the Agent actually received by
noon (Boston time) not less than three Banking Days prior to the
commencement of the LIBOR Interest Period selected in such notice, elect to
have such portion of the Loan as the Company may specify in such notice
accrue and bear interest during the LIBOR Interest Period so selected at
the Applicable Rate computed on the basis of the LIBOR Rate. In the event
the Company at any time does not elect a LIBOR Pricing Option under this
Section 3.2.1 for any portion of the Loan (upon termination of a LIBOR
Pricing Option or otherwise), then such portion of the Loan will accrue and
bear interest at the Applicable Rate based on the Base Rate. A single LIBOR
Pricing Option may include any portion of the Revolving Loan or Acquisition
Loan designated by the Company in the notice referred to above so long as
the Percentage Interests of the Lenders are the same for each such portion
of the Loan. No election of a LIBOR Pricing Option shall become effective:
(1) if, prior to the commencement of any such LIBOR Interest Period,
the Agent determines that (i) the electing or granting of the LIBOR Pricing
Option in question would violate a Legal Requirement, (ii) LIBOR Deposits
in an amount comparable to the amount of the Loan as to which such LIBOR
Pricing Option has been elected and which have a term corresponding to the
proposed LIBOR Interest Period are not readily available in the inter-bank
LIBOR market or (iii) by reason of circumstances affecting the inter-bank
LIBOR market, adequate and reasonable methods
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do not exist for ascertaining the interest rate applicable to such deposits
for the proposed LIBOR Interest Period; or
(2) if the Required Lenders shall have advised the Agent by telephone
or otherwise at or prior to noon (Boston time) on the second Banking Day
prior to the commencement of such proposed LIBOR Interest Period (and shall
have subsequently confirmed in writing) that, after reasonable efforts to
determine the availability of such LIBOR Deposits, the Required Lenders
reasonably anticipate that LIBOR Deposits in an amount equal to the
Percentage Interest of the Required Lenders in the portion of the Loan as
to which such LIBOR Pricing Option has been elected and which have a term
corresponding to the LIBOR Interest Period in question will not be offered
in the LIBOR market to the Required Lenders at a rate of interest that does
not exceed the anticipated LIBOR Basic Rate.
3.2.2. NOTICE TO LENDERS AND THE COMPANY. The Agent will promptly
inform each Lender (by telephone or otherwise) of each notice received by
it from the Company pursuant to Section 3.2.1 and of the LIBOR Interest
Period specified in such notice. Upon determination by the Agent of the
LIBOR Rate for such LIBOR Interest Period or in the event such election
shall not become effective, the Agent will promptly notify the Company and
each Lender (by telephone or otherwise) of the LIBOR Rate so determined or
why such election did not become effective, as the case may be.
3.2.3. SELECTION OF LIBOR INTEREST PERIODS. LIBOR Interest Periods
shall be selected so that:
(1) the minimum portion of the Loan subject to any LIBOR Pricing
Option shall be $2,000,000 and an integral multiple of $500,000;
(2) no more than six LIBOR Pricing Options shall be outstanding at
any one time;
(3) no LIBOR Interest Period shall expire later than the Maturity
Date; and (1)
(4) prior to the date 60 days after the Initial Closing Date or the
earlier date the Agent informs the Company that the proposed initial
syndication of the credit facilities provided hereby will close, no LIBOR
Interest Period shall extend beyond such date except with the written
consent of the Agent, which consent shall not be unreasonably withheld. The
Company and the Agent shall confer about the appropriate scheduling of the
selection of LIBOR Interest Periods to facilitate the anticipated
syndication of the credit facilities provided herein to other Lenders.
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3.2.4. REIMBURSEMENT OF BREAKAGE COSTS. If any portion of the Loan
subject to a LIBOR Pricing Option is repaid, or any LIBOR Pricing Option is
terminated for any reason (including acceleration of maturity), on a date
which is prior to the last Banking Day of the LIBOR Interest Period
applicable to such LIBOR Pricing Option, the Company will pay to the Agent
for the account of each Lender in accordance with such Lender's Percentage
Interest, in addition to any amounts of interest otherwise payable
hereunder, an amount equal to the present value (calculated in accordance
with this Section 3.2.4) of interest for the unexpired portion of such
LIBOR Interest Period on the portion of the Loan so repaid, or as to which
a LIBOR Pricing Option was so terminated, at a per annum rate equal to the
excess, if any, of (a) the rate applicable to such LIBOR Pricing Option
MINUS (b) the lowest rate of interest obtainable by the Agent upon the
purchase of debt securities customarily issued by the Treasury of the
United States of America which have a maturity date approximating the last
Banking Day of such LIBOR Interest Period. The present value of such
additional interest shall be calculated by discounting the amount of such
interest for each day in the unexpired portion of such LIBOR Interest
Period from such day to the date of such repayment or termination at a per
annum interest rate equal to the interest rate determined pursuant to
clause (b) of the preceding sentence, and by adding all such amounts for
all such days during such period. The determination by the Agent of such
amount of interest shall, in the absence of manifest error, be conclusive.
For purposes of this Section 3.2.4, if any portion of the Loan which was to
have been subject to a LIBOR Pricing Option is not outstanding on the first
day of the LIBOR Interest Period applicable to such LIBOR Pricing Option
other than for reasons described in Section 3.2.1 or as a result of the
failure of any Lender to perform its obligations under Section 2, the
Company shall be deemed to have terminated such LIBOR Pricing Option.
3.2.5. VIOLATION OF LEGAL REQUIREMENTS. If any mandatory Legal
Requirement shall prevent any Lender from funding or maintaining through
the purchase of deposits in the interbank LIBOR market any portion of the
Loan subject to a LIBOR Pricing Option or otherwise from giving effect to
such Lender's obligations as contemplated by Section 3.2, (a) the Agent may
by notice to the Company terminate all of the affected LIBOR Pricing
Options of such Lender on the respective last day of the then current LIBOR
Interest Period with respect to such Loan or within such earlier period as
required by law, (b) the portion of the Loan subject to such terminated
LIBOR Pricing Options shall immediately bear interest thereafter at the
Applicable Rate computed on the basis of the Base Rate and (c) the Company
shall make any payment required by Section 3.2.4. The Company shall be
entitled to replace any such Lender in accordance with Section 11.3.
3.2.6. FUNDING PROCEDURE. The Lenders may fund any portion of the Loan
subject to a LIBOR Pricing Option out of any funds available to the
Lenders. Regardless of the source of the funds actually used by any of the
Lenders to fund any
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portion of the Loan subject to a LIBOR Pricing Option, however, all amounts
payable hereunder, including the interest rate applicable to any such
portion of the Loan and the amounts payable under Sections 3.2.4 and 3.5,
shall be computed as if each Lender had actually funded such Lender's
Percentage Interest in such portion of the Loan through the purchase of
deposits in such amount of the type by which the LIBOR Basic Rate was
determined with a maturity the same as the applicable LIBOR Interest Period
relating thereto and through the transfer of such deposits from an office
of the Lender having the same location as the applicable LIBOR Office to
one of such Lender's offices in the United States of America.
3.3. COMMITMENT FEES.
3.3.1. REVOLVING CREDIT COMMITMENT FEE. In consideration of the
Lenders' commitments to make the extensions of credit provided for in
Section 2.1, while such commitments are outstanding, the Company will pay
to the Agent for the account of the Lenders in accordance with the Lenders'
respective Commitments in the Revolving Loan, on each Payment Date, an
amount equal to interest computed at the Commitment Fee Rate as of such
Payment Date on the amount by which (a) the daily Maximum Amount of
Revolving Credit during the three-month period or portion thereof ending on
such Payment Date exceeded (b) the sum of (i) the daily Revolving Loan
during such period or portion thereof PLUS (ii) the daily Letter of Credit
Exposure during such period or portion thereof.
3.3.2. ACQUISITION CREDIT COMMITMENT FEE. In consideration of the
Lenders' commitments to make the extensions of credit provided for in
Section 2.2, while such commitments are outstanding, the Company will pay
to the Agent for the account of the Lenders in accordance with the Lenders'
respective Commitments in the Acquisition Loan, on each Payment Date, an
amount equal to interest computed at the Commitment Fee Rate as of such
Payment Date on the respective amounts by which (a) the daily Maximum
Amount of Acquisition Credit during the three-month period or portion
thereof ending on such Payment Date exceeded (b) the daily Acquisition Loan
during such period or portion thereof.
3.4. LETTER OF CREDIT FEES. The Company will pay to the Agent for the
account of each of the Lenders, in accordance with the Lenders' respective
Percentage Interests, in arrears on each Payment Date, a Letter of Credit fee
equal to interest at a rate per annum equal to the sum of (a) the Applicable
Margin indicated for the LIBOR Rate plus (b) an additional 2% per annum
effective on the day the Agent provides written notice to the Company that the
interest rates hereunder are increasing as a result of the occurrence and
continuance of an Event of Default until the earlier of such time as (i) such
Event of Default is no longer continuing or (ii) such Event of Default is deemed
no longer to exist, in each case pursuant to Section 8.3, on the daily Letter of
Credit Exposure during the three-month period or portion thereof ending
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on such Payment Date. The Company will pay to the Letter of Credit Issuer, for
its own account, on the date such Letter of Credit is issued, extended, renewed
or amended, an amount equal to (i) interest computed at the rate of 0.125% per
annum on the amount of such Letter of Credit being issued and (ii) customary
service charges and expenses for its services in connection with such Letter of
Credit at the times and in the amounts from time to time in effect in accordance
with its general rate structure, including fees and expenses relating to
issuance, amendment, negotiation, cancellation and similar operations.
3.5. CHANGES IN CIRCUMSTANCES; YIELD PROTECTION.
3.5.1. RESERVE REQUIREMENTS, ETC. If any Legal Requirement shall (a)
impose, modify, increase or deem applicable any insurance assessment,
reserve, special deposit or similar requirement against any Funding
Liability or the Letters of Credit, (b) impose, modify, increase or deem
applicable any other requirement or condition with respect to any Funding
Liability or the Letters of Credit or (c) change the basis of taxation of
Funding Liabilities or payments in respect of any Letter of Credit (other
than changes in the rate of taxes measured by the overall net income of
such Lender) and the effect of any of the foregoing shall be to increase
the cost to any Lender of issuing, making, funding or maintaining its
respective Percentage Interest in any portion of the Loan subject to a
LIBOR Pricing Option or any Letter of Credit, to reduce the amounts
received or receivable by such Lender under this Agreement or to require
such Lender to make any payment or forego any amounts otherwise payable to
such Lender under this Agreement (other than any Tax or any reserves that
are included in computing the LIBOR Reserve Rate), then such Lender may
claim compensation from the Company under Section 3.5.5.
3.5.2. TAXES. All payments of the Credit Obligations shall be made
without set-off or counterclaim and free and clear of any deductions,
including deductions for Taxes, unless the Company is required by law to
make such deductions. If (a) any Lender shall be subject to any Tax with
respect to any payment of the Credit Obligations or its obligations
hereunder or (b) the Company shall be required to withhold or deduct any
Tax on any payment on the Credit Obligations, then such Lender may claim
compensation from the Company under Section 3.5.5 to the extent such Lender
is then in compliance with any applicable requirements of Section 13.
Whenever Taxes must be withheld by the Company with respect to any payments
of the Credit Obligations, the Company shall promptly furnish to the Agent
for the account of the applicable Lender official receipts (to the extent
that the relevant governmental authority delivers such receipts) evidencing
payment of any such Taxes so withheld. If the Company fails to pay any such
Taxes when due or fails to remit to the Agent for the account of the
applicable Lender the required receipts evidencing payment of any such
Taxes so withheld or deducted, the Company shall indemnify the affected
Lender for any incremental Taxes and interest or penalties that may become
payable by such
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Lender as a result of any such failure. In the event any Lender receives a
refund of any Taxes for which it has received payment from the Company
under this Section 3.5.2, such Lender shall promptly pay the amount of such
refund to the Company, together with any interest thereon actually earned
by such Lender.
3.5.3. CAPITAL ADEQUACY. If any Lender shall determine that compliance
by such Lender with any Legal Requirement regarding capital adequacy of
banks or bank holding companies has or would have the effect of reducing
the rate of return on the capital of such Lender and its Affiliates as a
consequence of such Lender's commitment to make the extensions of credit
contemplated hereby, or such Lender's maintenance of the extensions of
credit contemplated hereby, to a level below that which such Lender could
have achieved but for such compliance (taking into consideration the
policies of such Lender and its Affiliates with respect to capital adequacy
immediately before such compliance and assuming that the capital of such
Lender and its Affiliates was fully utilized prior to such compliance) by
an amount deemed by such Lender to be material, then such Lender may claim
compensation from the Company under Section 3.5.5.
3.5.4. REGULATORY CHANGES. If any Lender shall determine that (a) any
change in any Legal Requirement (including any new Legal Requirement) after
the date hereof shall directly or indirectly (i) reduce the amount of any
sum received or receivable by such Lender with respect to the Loan or the
Letters of Credit or the return to be earned by such Lender on the Loan or
the Letters of Credit, (ii) impose a cost on such Lender or any Affiliate
of such Lender that is attributable to the making or maintaining of, or
such Lender's commitment to make, its portion of the Loan or the Letters of
Credit, or (iii) require such Lender or any Affiliate of such Lender to
make any payment on, or calculated by reference to, the gross amount of any
amount received by such Lender under any Credit Document (other than Taxes
or income or franchise taxes), and (b) such reduction, increased cost or
payment shall not be fully compensated for by an adjustment in the
Applicable Rate or the Letter of Credit fees, then such Lender may claim
compensation from the Company under Section 3.5.5.
3.5.5. COMPENSATION CLAIMS. Within 15 days after the receipt by the
Company of a certificate from any Lender setting forth why it is claiming
compensation under this Section 3.5 and computations (in reasonable detail)
of the amount thereof, the Company shall pay to such Lender such additional
amounts as such Lender sets forth in such certificate as sufficient fully
to compensate it on account of the foregoing provisions of this Section
3.5, together with interest on such amount from the 15th day after receipt
of such certificate until payment in full thereof at the Overdue
Reimbursement Rate. The determination by such Lender of the amount to be
paid to it and the basis for computation thereof hereunder shall be
conclusive so long as (a) such determination is made in good faith, (b) no
manifest error appears therein and (c) the
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Lender uses reasonable averaging and attribution methods. The Company shall
be entitled to replace any such Lender in accordance with Section 11.3.
3.5.6. MITIGATION. Each Lender shall take such commercially reasonable
steps as it may determine are not materially disadvantageous to it,
including changing lending offices to the extent feasible, in order to
reduce amounts otherwise payable by the Company to such Lender pursuant to
Sections 3.2.4 and 3.5 or to make LIBOR Pricing Options available under
Sections 3.2.1 and 3.2.5. In addition, the Company shall not be responsible
for costs (a) under Section 3.5 arising more than 90 days prior to receipt
by the Company of the certificate from the affected Lender pursuant to such
Section 3.5 or (b) under Section 3.2.4 arising from the termination of
LIBOR Pricing Options more than 90 days prior to the demand by the Agent
for payment under Section 3.2.4.
3.6. COMPUTATIONS OF INTEREST AND FEES. For purposes of this Agreement,
interest, commitment fees and Letter of Credit fees (and any other amount
expressed as interest or such fees) shall be computed on the basis of a 360-day
year for actual days elapsed; PROVIDED, HOWEVER, that interest on any portion of
the Loan for which interest is calculated on the basis of the Base Rate shall be
computed on the basis of a 365/6-day year. If any payment required by this
Agreement becomes due on any day that is not a Banking Day, such payment shall,
except as otherwise provided in the definition of "LIBOR Interest Period", be
made on the next succeeding Banking Day. If the due date for any payment of
principal is extended as a result of the immediately preceding sentence,
interest shall be payable for the time during which payment is extended at the
Applicable Rate.
4. PAYMENT.
4.1. PAYMENT AT MATURITY. On the Maturity Date or any accelerated maturity
of the Loan, the Company will pay to the Agent an amount equal to the Loan then
due, together with all accrued and unpaid interest and fees with respect thereto
and all other Credit Obligations then outstanding.
4.2. CONTINGENT REQUIRED PREPAYMENTS.
4.2.1. EXCESS CREDIT EXPOSURE. If at any time the Revolving Loan
exceeds the limits set forth in Section 2.1 or the Acquisition Loan exceeds
the limits set forth in Section 2.2, the Company shall within one Banking
Day after actual knowledge by a Financial Officer or notice from the Agent
pay the amount of such excess to the Agent as a prepayment of the Revolving
Loan or the Acquisition Loan, as the case may be. If at any time the Letter
of Credit Exposure exceeds the limits set forth in Section 2.3, the Company
shall within one Banking Day after actual knowledge by a
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Financial Officer or notice from the Agent pay the amount of such excess to
the Agent to be applied as provided in Section 4.4.
4.2.2. NET ASSET SALE PROCEEDS. Upon receipt by the Company or any of
its Subsidiaries of Net Asset Sale Proceeds or net proceeds of asset sales
permitted by Section 6.11.7, the Company shall within one Banking Day pay
to the Agent as a prepayment of the Loan to be applied as provided in
Section 4.5.2 the lesser of (a) the amount of such Net Asset Sale Proceeds
or (b) the amount of the Loan.
4.2.3. NET DEBT PROCEEDS. Upon receipt of Net Debt Proceeds by the
Company or any of its Subsidiaries, the Company shall within one Banking
Day pay to the Agent as a prepayment of the Loan to be applied as provided
in Section 4.5.2 the lesser of (a) the amount of such Net Debt Proceeds or
(b) the amount of the Loan.
4.2.4. NET EQUITY PROCEEDS. Upon receipt of Net Equity Proceeds by the
Company or any of its Subsidiaries, the Company shall within one Banking
Day pay to the Agent as a prepayment of the Loan to be applied as provided
in Section 4.5.2 the lesser of (a) the amount of such Net Equity Proceeds
or (b) the amount of the Loan.
4.2.5. CASH MANAGEMENT AGREEMENT. At the times and in the amounts
required by the Cash Management Agreement, the Company will pay to the
Agent for the account of the Lenders prepayments of the Revolving Loan.
4.3. VOLUNTARY PREPAYMENTS. In addition to the prepayments required by
Section 4.2, the Company may from time to time prepay all or any portion of the
Loan (in a minimum amount of $1,000,000 and an integral multiple of $500,000,
except with respect to payments made pursuant to the Cash Management Agreement
as to which no minimum amount shall apply, or such lesser amount as is then
outstanding), without premium or penalty of any type (except as provided in
Section 3.2.4 with respect to the early termination of LIBOR Pricing Options).
The Company shall give the Agent at least one Banking Day prior notice of its
intention to prepay the Loan under this Section 4.3, specifying the date of
payment and the total amount of the Revolving Loan and the Acquisition Loan to
be paid on such date.
4.4. LETTERS OF CREDIT. If on the Maturity Date or any accelerated maturity
of the Credit Obligations the Lenders shall be obligated in respect of a Letter
of Credit or a draft accepted under a Letter of Credit, the Company will either:
(1) prepay such obligation by depositing cash with the Agent, or
(2) deliver to the Agent a standby letter of credit (designating the
Letter of Credit Issuer as beneficiary and issued by a bank and on terms
reasonably acceptable to the Letter of Credit Issuer),
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in each case in an amount equal to the portion of the then Letter of Credit
Exposure issued for the account of the Company. Any such cash so deposited and
the cash proceeds of any draw under any standby Letter of Credit so furnished,
including any interest thereon, shall be returned by the Agent to the Company
only when, and to the extent that, the amount of such cash held by the Agent
exceeds the Letter of Credit Exposure at such time and no Default then exists;
PROVIDED, HOWEVER, that if an Event of Default occurs and the Credit Obligations
become or are declared immediately due and payable, the Agent may apply such
cash, including any interest thereon, to the payment of any of the Credit
Obligations.
4.5. REBORROWING; APPLICATION OF PAYMENTS, ETC.
4.5.1. REBORROWING. The amounts of the Revolving Loan or the
Acquisition Loan prepaid pursuant to Sections 4.2.1, 4.2.4, 4.2.5, 4.3 or
from the net proceeds from dispositions of assets permitted by Section
6.11.7 may be reborrowed from time to time prior to the Maturity Date in
accordance with Sections 2.1 and 2.2, subject to the limits set forth
therein.
4.5.2. ORDER OF APPLICATION. In the absence of notice to the contrary
by the Company, any prepayment of the Loan pursuant to Sections 4.2.2,
4.2.3, 4.2.4 or 4.3 shall be applied first to the Revolving Loan, with any
balance to the Acquisition Loan. Subject to the foregoing, any prepayment
of the Loan shall be applied first to the portion of the Revolving Loan or
Acquisition Loan, as the case may be, not then subject to LIBOR Pricing
Options, then the balance of any such prepayment shall be applied to the
portion of the Revolving Loan or Acquisition Loan, as the case may be, then
subject to LIBOR Pricing Options, in the chronological order of the
respective maturities thereof (or as the Company may otherwise specify in
writing), together with any payments required by Section 3.2.4.
4.5.3. PAYMENTS FOR LENDERS. All payments of principal hereunder shall
be made to the Agent for the account of the Lenders in accordance with the
Lenders' respective Percentage Interests in the Credit Obligations so
repaid.
5. CONDITIONS TO EXTENDING CREDIT.
5.1. CONDITIONS ON INITIAL CLOSING DATE. The obligations of the Lenders to
make the initial extension of credit pursuant to Section 2 shall be subject to
the satisfaction, on or before the Initial Closing Date, of the conditions set
forth in this Section 5.1 as well as the further conditions in Section 5.2. If
the conditions set forth in this Section 5.1 are not met on or prior to the
Initial Closing Date, the Lenders shall have no obligation to make any
extensions of credit hereunder.
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5.1.1. NOTES. The Company shall have duly executed and delivered to
the Agent a Revolving Note and an Acquisition Note for each Lender having a
Commitment with respect thereto who has requested delivery of a Note prior
to the Initial Closing Date.
5.1.2. PAYMENT OF FEES. The Company shall have paid to the Agent and
the Syndication Agent the fees contemplated by the separate letter
agreement among the Agent, the Syndication Agent, certain of their
respective affiliates and the Company dated prior to the date hereof, which
fees may be paid from proceeds of the initial loan made pursuant to Section
2.
5.1.3. LEGAL OPINIONS. On the Initial Closing Date, the Lenders shall
have received from the following special counsel for the Company and its
Subsidiaries their respective opinions with respect to the transactions
contemplated by the Credit Documents, which opinions shall be in form and
substance reasonably satisfactory to the Required Lenders:
(1) Xxxxxx & Xxxxxxx;
(2) Maron & Sandler; and
(3) Xxxxxxx, Xxxxx & Xxxxx.
The Company authorizes and directs its special counsels to furnish the
foregoing opinions.
5.1.4. GUARANTEE AND SECURITY AGREEMENT. Each of the Company and its
Domestic Subsidiaries (other than Cranberry Hill Capital) shall have duly
authorized, executed and delivered to the Agent a Guarantee and Security
Agreement in substantially the form of Exhibit 5.1.4 (the "GUARANTEE AND
SECURITY AGREEMENT").
5.1.5. PERFECTION OF SECURITY. Each Obligor shall have duly
authorized, executed, acknowledged, delivered, filed, registered and
recorded such security agreements, notices, financing statements, memoranda
of intellectual property security interests and other instruments as the
Agent may have reasonably requested in order to perfect the Liens purported
or required pursuant to the Credit Documents to be created in the Credit
Security and shall have paid all filing or recording fees or taxes required
to be paid in connection therewith, including any recording, mortgage,
documentary, transfer or intangible taxes.
5.1.6. SUBORDINATION AGREEMENT. Each of Knowledge Universe and the
Company shall have duly authorized, executed and delivered to the Agent a
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Subordination Agreement in substantially the form of Exhibit 5.1.6 (the
"SUBORDINATION AGREEMENT").
5.1.7. SOLVENCY.
(1) After giving effect to the incurrence of the Credit Obligations,
the Company and its Domestic Subsidiaries, taken as a whole:
(1) will be solvent;
(2) will have assets having a fair saleable value in excess of
the amount required to pay their probable liability on their existing
debts as such debts become absolute and mature;
(3) will have access to adequate capital for the conduct of
their business; and
(4) will have the ability to pay their debts from time to time
incurred as such debts mature.
(2) The Company shall have furnished to the Lenders a certificate,
signed by a Financial Officer, to such effect, together with calculations
pursuant to Section 7.2.1(d) with respect to the Computation Covenants, in
each case giving pro forma effect to the incurrence of the Credit
Obligations.
5.1.8. TERMINATION OF PRIOR CREDIT AGREEMENT. Contemporaneously with
the initial advances hereunder, the Company and its Subsidiaries shall have
paid in full all principal, interest and other accrued and outstanding
amounts under the Prior Credit Agreement (other than reimbursement
obligations with respect to letters of credit issued under the Prior Credit
Agreement that constitute Letters of Credit under this Agreement in
accordance with Section 2.3.1), all Liens securing amounts owing under the
Prior Credit Agreement shall have been released or assigned to the Agent
and the Prior Credit Agreement shall have become terminated and of no
further force or effect (except for indemnity provisions that by their
terms survive the termination of the Prior Credit Agreement).
5.1.9. PROPER PROCEEDINGS. This Agreement, each other Credit Document
and the transactions contemplated hereby and thereby shall have been
authorized by all necessary corporate or other proceedings. All necessary
consents, approvals and authorizations of any governmental or
administrative agency or any other Person of any of the transactions
contemplated hereby or by any other Credit Document shall have been
obtained and shall be in full force and effect.
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5.1.10. GENERAL. All legal and corporate proceedings in connection
with the transactions contemplated by this Agreement shall be reasonably
satisfactory in form and substance to the Agent and the Agent shall have
received copies of all documents, including certified copies of the Charter
and By-Laws of the Company and the other Obligors, records of corporate
proceedings, certificates as to signatures and incumbency of officers and
opinions of counsel, which the Agent may have reasonably requested in
connection therewith, such documents where appropriate to be certified by
proper corporate or governmental authorities.
5.2. CONDITIONS TO EACH EXTENSION OF CREDIT. The obligations of the Lenders
to make any extension of credit pursuant to Section 2 shall be subject to the
satisfaction, on or before the Closing Date for such extension of credit, of the
following conditions:
5.2.1. OFFICER'S CERTIFICATE. The representations and warranties
contained in Section 7 shall be true and correct on and as of such Closing
Date with the same force and effect as though made on and as of such date
(except as to any representation or warranty which refers to a specific
earlier date); no Default shall exist on such Closing Date prior to or
immediately after giving effect to the requested extension of credit; no
Material Adverse Change shall have occurred; in the event of an advance
under the Acquisition Loan, the proceeds shall be used to finance all or a
portion of an acquisition permitted by Section 6.9 and, on the Initial
Closing Date, amounts outstanding under the Prior Credit Agreement; and,
except in connection with a loan made in accordance with the Cash
Management Agreement in a principal amount less than $250,000 (and loans up
to $2,500,000 made on the first and fifteenth days of the month for payroll
purposes), the Company shall have furnished to the Agent in connection with
the requested extension of credit a certificate to these effects, in
substantially the form of Exhibit 5.2.1, signed by a Financial Officer.
5.2.2. LEGALITY, ETC. The making of the requested extension of credit
shall not (a) subject any Lender to any penalty or special tax (other than
a Tax for which the Company is required to reimburse the Lenders under
Section 3.5), (b) be prohibited by any Legal Requirement or (c) violate any
credit restraint program of the executive branch of the government of the
United States of America, the Board of Governors of the Federal Reserve
System or any other governmental or administrative agency so long as any
Lender reasonably believes that compliance therewith is customary
commercial practice.
6. GENERAL COVENANTS. Each of the Company and the other Guarantors covenants
that, until all of the Credit Obligations shall have been paid in full and until
the Lenders' commitments to extend credit under this Agreement and any other
Credit Document shall have
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been irrevocably terminated, the Company and its Subsidiaries will comply with
the following provisions:
6.1. TAXES AND OTHER CHARGES; ACCOUNTS PAYABLE.
6.1.1. TAXES AND OTHER CHARGES. Each of the Company and its
Subsidiaries shall duly pay and discharge, or cause to be paid and
discharged, before the same becomes in arrears, all taxes, assessments and
other governmental charges imposed upon such Person and its properties,
sales or activities, or upon the income or profits therefrom, as well as
all claims for labor, materials or supplies which if unpaid might by law
become a Lien upon any of its property; PROVIDED, HOWEVER, that any such
tax, assessment, charge or claim need not be paid if the validity or amount
thereof shall at the time be contested in good faith by appropriate
proceedings and if such Person shall, in accordance with GAAP, have set
aside on its books adequate reserves with respect thereto; and PROVIDED,
FURTHER, that each of the Company and its Subsidiaries shall pay or bond,
or cause to be paid or bonded, all such taxes, assessments, charges or
other governmental claims immediately upon the commencement of proceedings
to foreclose any Lien which may have attached as security therefor (except
to the extent such proceedings have been dismissed or stayed).
6.1.2. ACCOUNTS PAYABLE. Each of the Company and its Subsidiaries
shall promptly pay when due, or in conformity with customary trade terms,
all accounts payable incident to the operations of such Person not referred
to in Section 6.1.1; PROVIDED, HOWEVER, that any such accounts payable need
not be paid if the validity or amount thereof shall at the time be
contested in good faith and if such Person shall, in accordance with GAAP,
have set aside on its books adequate reserves with respect thereto.
6.2. CONDUCT OF BUSINESS, ETC.
6.2.1. TYPES OF BUSINESS. The Company and its Subsidiaries shall
engage only in the business of (a) business consulting, (b) minority
investments in and cooperative ventures with Internet, intellectual
property and other service-oriented businesses and (c) other activities
related thereto.
6.2.2. MAINTENANCE OF PROPERTIES. Each of the Company and its
Subsidiaries:
(1) shall keep its properties in such repair, working order and
condition, and shall from time to time make such repairs, replacements,
additions and improvements thereto, as are necessary for the efficient
operation of its businesses and shall comply at all times in all material
respects with all material franchises, licenses and leases to
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which it is party so as to prevent any loss or forfeiture thereof or
thereunder, except where (i) compliance is at the time being contested in
good faith by appropriate proceedings and (ii) failure to comply with the
provisions being contested has not resulted, and does not create a material
risk of resulting, in the aggregate in any Material Adverse Change; and (1)
(2) shall do all things necessary to preserve, renew and keep in full
force and effect and in good standing its legal existence and authority
necessary to continue its business; PROVIDED, HOWEVER, that this Section
6.2.2(b) shall not prevent the merger, consolidation or liquidation of
Subsidiaries permitted by Section 6.11.
6.2.3. STATUTORY COMPLIANCE. Each of the Company and its Subsidiaries
shall comply in all material respects with all valid Legal Requirements
applicable to it, except where (a) compliance therewith shall at the time
be contested in good faith by appropriate proceedings and (b) failure so to
comply with the provisions being contested has not resulted, and does not
create a material risk of resulting, in the aggregate in any Material
Adverse Change.
6.2.4. COMPLIANCE WITH MATERIAL AGREEMENTS. Each of the Company and
its Subsidiaries shall comply in all material respects with the Material
Agreements (to the extent not in violation of the other provisions of this
Agreement or any other Credit Document). Without the prior written consent
of the Required Lenders, no Material Agreement shall be amended, modified,
waived or terminated in any manner that would have in any material respect
an adverse effect on the interests of the Lenders.
6.3. INSURANCE.
6.3.1. BUSINESS INTERRUPTION INSURANCE. Each of the Company and its
Subsidiaries shall maintain with financially sound and reputable insurers
insurance related to interruption of business, either for loss of revenues
or for extra expense, in the manner customary for businesses of similar
size engaged in similar activities.
6.3.2. PROPERTY INSURANCE. Each of the Company and its Subsidiaries
shall keep its assets which are of an insurable character insured by
financially sound and reputable insurers against theft and fraud and
against loss or damage by fire, explosion and hazards insured against by
extended coverage to the extent, in amounts and with deductibles at least
as favorable as those generally maintained by businesses of similar size
engaged in similar activities.
6.3.3. LIABILITY INSURANCE. Each of the Company and its Subsidiaries
shall maintain with financially sound and reputable insurers insurance
against liability
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for hazards, risks and liability to persons and property to the extent, in
amounts and with deductibles at least as favorable as those generally
maintained by businesses of similar size engaged in similar activities;
PROVIDED, HOWEVER, that it may effect workers' compensation insurance or
similar coverage with respect to operations in any particular state or
other jurisdiction through an insurance fund operated by such state or
jurisdiction or by meeting the self-insurance requirements of such state or
jurisdiction.
6.4. FINANCIAL STATEMENTS AND REPORTS. Each of the Company and its
Subsidiaries shall maintain a system of accounting in which correct entries
shall be made of all transactions in relation to their business and affairs in
accordance with generally accepted accounting practice. The fiscal year of the
Company and its Subsidiaries shall end on December 31 in each year and the
fiscal quarters of the Company and its Subsidiaries shall end on March 31, June
30, September 30 and December 31 in each year.
6.4.1. ANNUAL REPORTS. The Company shall furnish to the Agent (with
copies for each Lender) within 92 days after the end of each fiscal year,
the Consolidated and Consolidating balance sheets of the Company and its
Subsidiaries as at the end of such fiscal year, the Consolidated and
Consolidating statements of income and Consolidated statements of changes
in shareholders' equity and of cash flows of the Company and its
Subsidiaries for such fiscal year (all in reasonable detail) and, in the
case of Consolidated financial statements, comparative figures for the
immediately preceding fiscal year, all accompanied by:
(1) Reports of independent certified public accountants of recognized
national standing reasonably satisfactory to the Required Lenders,
containing no material qualification, to the effect that they have audited
the foregoing Consolidated financial statements in accordance with
generally accepted auditing standards and that such Consolidated financial
statements present fairly, in all material respects, the financial position
of the Company and its Subsidiaries covered thereby at the dates thereof
and the results of their operations for the periods covered thereby in
conformity with GAAP.
(2) The statement of such accountants that they have caused this
Agreement to be reviewed and that in the course of their audit of the
Company and its Subsidiaries no facts have come to their attention that
cause them to believe that any Default exists and in particular that they
have no knowledge of any Default under the Computation Covenants or, if
such is not the case, specifying such Default and the nature thereof. This
statement is furnished by such accountants with the understanding that the
examination of such accountants cannot be relied upon to give such
accountants knowledge of any such Default except as it relates to
accounting or auditing matters within the scope of their audit.
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(3) A certificate of the Company signed by a Financial Officer to the
effect that such officer has caused this Agreement to be reviewed and has
no knowledge of any Default, or if such officer has such knowledge,
specifying such Default and the nature thereof, and what action the Company
has taken, is taking or proposes to take with respect thereto.
(4) Computations by the Company comparing the financial statements
referred to above with the most recent budget for such fiscal year
furnished to the Agent in accordance with Section 6.4.4.
(5) Computations by the Company in substantially the form of Exhibit
6.4 demonstrating, as of the end of such fiscal year, compliance with the
Computation Covenants, signed by a Financial Officer.
(6) Calculations, as at the end of such fiscal year, of (i) the
Accumulated Benefit Obligations for each Plan (other than Multiemployer
Plans) having Accumulated Benefit Obligations in excess of $1,000,000 and
(ii) the fair market value of the assets of such Plan allocable to such
benefits.
(7) Supplements to Exhibits 7.1, 7.3, 7.14 and 7.15 showing any
changes in the information set forth in such exhibits not previously
furnished to the Agent in writing, as well as any changes in the Charter,
Bylaws or incumbency of officers of the Obligors from those previously
certified to the Agent.
(8) In the event of a change in GAAP after December 31, 1998,
computations by the Company, signed by a Financial Officer, reconciling the
financial statements referred to above with financial statements prepared
in accordance with GAAP as applied to the other covenants in Section 6 and
related definitions.
(9) In reasonable detail, management's discussion and analysis of the
results of operations and the financial condition of the Company and its
Subsidiaries as at the end of and for the year covered by such financial
statements.
6.4.2. QUARTERLY REPORTS. The Company shall furnish to the Agent (with
copies for each Lender) within 47 days after the end of each of the first
three fiscal quarters of the Company, the internally prepared Consolidated
and Consolidating balance sheets of the Company and its Subsidiaries as of
the end of such fiscal quarter, the Consolidated and Consolidating
statements of income and the Consolidated statements of changes in
shareholders' equity and of cash flows of the Company and its Subsidiaries
for such fiscal quarter and for the portion of the fiscal year then ended
(all in reasonable detail) and comparative figures for the same period in
the preceding fiscal year, all accompanied by:
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(1) A certificate of the Company signed by a Financial Officer to the
effect that such financial statements have been prepared in accordance with
GAAP and present fairly, in all material respects, the financial position
of the Company and its Subsidiaries covered thereby at the dates thereof
and the results of their operations for the periods covered thereby,
subject only to normal year-end audit adjustments and the addition of
footnotes.
(2) A certificate of the Company signed by a Financial Officer to the
effect that such officer has caused this Agreement to be reviewed and has
no knowledge of any Default, or if such officer has such knowledge,
specifying such Default and the nature thereof and what action the Company
has taken, is taking or proposes to take with respect thereto.
(3) Computations by the Company comparing the financial statements
referred to above with the most recent budget for the period covered
thereby furnished to the Agent in accordance with Section 6.4.4.
(4) Computations by the Company in substantially the form of Exhibit
6.4 demonstrating, as of the end of such quarter, compliance with the
Computation Covenants, signed by a Financial Officer.
(5) Supplements to Exhibits 7.1, 7.3, 7.14 and 7.15 showing any
changes in the information set forth in such exhibits not previously
furnished to the Agent in writing, as well as any changes in the Charter,
Bylaws or incumbency of officers of the Obligors from those previously
certified to the Agent.
(6) In reasonable detail, management's discussion and analysis of the
results of operations and financial condition of the Company and its
Subsidiaries as at the end of and for the fiscal period covered by the
financial statements referred to above.
6.4.3. MONTHLY REPORTS. The Company shall furnish to the Agent (with
copies for each Lender) as soon as available and, in any event, within 25
days after the end of each month (other than months that coincide with the
end of a fiscal quarter of the Company), the internally prepared
Consolidated balance sheet of the Company and its Subsidiaries as at the
end of such month and the Consolidated statements of income and of cash
flows of the Company and its Subsidiaries for such month (all in reasonable
detail), together with other financial reporting items in substantially the
form of the Company's internal monthly reports, all accompanied by a
certificate of the Company signed by a Financial Officer to the effect that
such financial statements were prepared in accordance with GAAP and present
fairly, in all material respects, the financial position of the Persons
covered thereby at the dates thereof and the results of their
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operations for the periods covered thereby, subject only to normal year-end
audit adjustments and the addition of footnotes.
6.4.4. OTHER REPORTS. The Company shall promptly furnish to the Agent
(with copies for each Lender):
(1) As soon as prepared and in any event before the beginning of each
fiscal year, an annual budget and operating projections for such fiscal
year of the Company and its Subsidiaries, prepared in a manner consistent
with the manner in which the financial projections described in Section
7.2.1 were prepared.
(2) Any material updates of such budget and projections.
(3) Any management letters furnished to the Company or any of its
Subsidiaries by the Company's auditors.
(4) All budgets, projections, statements of operations and other
reports furnished generally to the shareholders of the Company.
(5) Such registration statements, proxy statements and reports,
including Forms X-0, X-0, X-0, X-0, 10-K, 10-Q and 8-K, as may be filed by
the Company or any of its Subsidiaries with the Securities and Exchange
Commission.
(6) Any 90-day letter or 30-day letter from the federal Internal
Revenue Service (or the equivalent notice received from state or other
taxing authorities) asserting tax deficiencies against the Company or any
of its Subsidiaries.
6.4.5. NOTICE OF LITIGATION, DEFAULTS, ETC. The Company shall promptly
furnish to the Agent notice of any litigation or any administrative or
arbitration proceeding (a) which creates a material risk of resulting,
after giving effect to any applicable insurance, in the payment by the
Company and its Subsidiaries of more than $500,000 or (b) which results, or
creates a material risk of resulting, in a Material Adverse Change.
Promptly upon acquiring knowledge thereof, the Company shall notify the
Agent of the existence of any Default or Material Adverse Change,
specifying the nature thereof and what action the Company or any of its
Subsidiaries has taken, is taking or proposes to take with respect thereto.
6.4.6. ERISA REPORTS. The Company shall furnish to the Agent (with
copies for each Lender) as soon as available the following items with
respect to any Plan:
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(1) any request for a waiver of the funding standards or an extension
of the amortization period,
(2) notice of any reportable event (as defined in section 4043 of
ERISA), unless the notice requirement with respect thereto has been waived
by regulation,
(3) any notice received by any ERISA Group Person that the PBGC has
instituted or intends to institute proceedings to terminate any Plan, or
that any Multiemployer Plan is insolvent or in reorganization,
(4) notice of the possibility of the termination of any Plan by its
administrator pursuant to section 4041 of ERISA, and
(5) notice of the intention of any ERISA Group Person to withdraw, in
whole or in part, from any Multiemployer Plan.
6.4.7. OTHER INFORMATION. Subject to Section 12, from time to time at
reasonable intervals upon request of the Agent, each of the Company and its
Subsidiaries shall furnish to the Agent such other information regarding
the business, assets, financial condition, income or prospects of the
Company and its Subsidiaries as such officer may reasonably request,
including copies of all tax returns, licenses, agreements, leases and
instruments to which any of the Company or its Subsidiaries is party. Each
Lender's authorized officers and representatives shall have the right
during normal business hours upon reasonable notice and at reasonable
intervals to examine the books and records of the Company and its
Subsidiaries, to make copies and notes therefrom for the purpose of
ascertaining compliance with or obtaining enforcement of this Agreement or
any other Credit Document; PROVIDED, HOWEVER, that the Agent shall
coordinate the exercise of such Lenders' rights to the extent practicable.
6.5. CERTAIN FINANCIAL TESTS.
6.5.1. CONSOLIDATED TOTAL DEBT TO CONSOLIDATED PRO FORMA EBITDA. On
the last day of each fiscal quarter of the Company, Consolidated Total Debt
shall not exceed the percentage set forth in the table below of
Consolidated Pro Forma EBITDA for the period of four consecutive fiscal
quarters ending on such date.
Period Ending Percentage
------------- ----------
June 30, 1999 through 300%
September 30, 2001
December 31, 2001 275%
and thereafter
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6.5.2. CONSOLIDATED PRO FORMA EBITDA MINUS CAPITAL EXPENDITURES TO
CONSOLIDATED PRO FORMA INTEREST EXPENSE. For each period of four
consecutive fiscal quarters of the Company (measured as of the last day of
each fiscal quarter of the Company), the ratio of (a) the remainder of
Consolidated Pro Forma EBITDA MINUS Capital Expenditures to (b)
Consolidated Pro Forma Interest Expense shall equal or exceed 3.00 to 1.00.
6.5.3. QUICK RATIO. The ratio of the sum of cash, Cash Equivalents and
accounts receivable carried on the balance sheet of the Company and its
Subsidiaries determined in accordance with GAAP on a Consolidated basis to
Consolidated Current Liabilities (excluding any portion of the Loan) shall
equal or exceed 1.10 to 1.00 at all times.
6.5.4. CONSOLIDATED ADJUSTED NET WORTH. Consolidated Adjusted Net
Worth shall at all times equal or exceed the sum of (a) 90% of Consolidated
Net Worth as of June 30, 1999, PLUS (b) 75% of Consolidated Adjusted
Positive Consolidated Net Income since June 30, 1999, PLUS (c) 90% of the
amount by which Consolidated shareholders' equity of the Company and its
Subsidiaries has been increased after June 30, 1999 by the proceeds of the
issuance of capital stock or options, warrants or other rights to acquire
such capital stock or from capital contributions.
6.6. INDEBTEDNESS. Neither the Company nor any of its Subsidiaries shall
create, incur, assume or otherwise become or remain liable with respect to any
Indebtedness (or become contractually committed to do so), except the following:
6.6.1. Indebtedness in respect of the Credit Obligations.
6.6.2. Guarantees permitted by Section 6.7.
6.6.3. Current liabilities, other than Financing Debt, incurred in the
ordinary course of business.
6.6.4. To the extent that payment thereof shall not at the time be
required by Section 6.1, Indebtedness in respect of taxes, assessments,
governmental charges and claims for labor, materials and supplies.
6.6.5. Indebtedness secured by Liens of carriers, warehouses,
mechanics, landlords and other Persons permitted by Sections 6.8.5 and
6.8.6.
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6.6.6. Indebtedness in respect of judgments or awards (a) which have
been in force for less than the applicable appeal period or (b) in respect
of which the Company or any Subsidiary shall at the time in good faith be
prosecuting an appeal or proceedings for review and, in the case of each of
clauses (a) and (b), the Company or such Subsidiary shall have taken
appropriate reserves therefor in accordance with GAAP and execution of such
judgment or award shall not be levied.
6.6.7. To the extent permitted by Section 6.8.7, Indebtedness in
respect of Capitalized Lease Obligations or secured by purchase money
security interests; PROVIDED, HOWEVER, that the aggregate principal amount
of all Indebtedness permitted by this Section 6.6.7 at any one time
outstanding shall not exceed $5,000,000.
6.6.8. Indebtedness in respect of deferred taxes arising in the
ordinary course of business.
6.6.9. Indebtedness in respect of inter-company loans and advances
among the Company and its Subsidiaries which are not prohibited by Section
6.9.
6.6.10. Unfunded pension liabilities and obligations with respect to
Plans so long as the Company and all other ERISA Group Persons are in
compliance with Section 6.16.
6.6.11. Indebtedness outstanding on the date hereof and described in
Exhibit 7.3 and (except with respect to the Prior Credit Agreement, which
shall be terminated on the Initial Closing Date) all renewals, refinancings
and extensions thereof not in excess of the amount thereof outstanding
immediately prior to such renewal or extension (without reducing
Indebtedness permitted under the other provisions of this Section 6.6).
6.6.12. Unsecured Indebtedness in respect of obligations incurred
pursuant to an acquisition permitted under Section 6.9, the amount of which
is deferred purchase price or based on post-acquisition performance (when
achieved) of the business or assets acquired (or Subsidiary acquiring such
business or assets) in connection with such acquisition, in an amount not
to exceed $1,000,000 at any one time outstanding.
6.6.13. Indebtedness of Foreign Subsidiaries owing to local lenders in
the jurisdiction of operations of such Foreign Subsidiaries in an aggregate
principal amount not exceeding $500,000 at any one time outstanding in an
equivalent amount of United States Funds.
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6.7. GUARANTEES; LETTERS OF CREDIT. Neither the Company nor any of its
Subsidiaries shall become or remain liable with respect to any Guarantee,
including reimbursement obligations, whether contingent or matured, under
letters of credit or other financial guarantees by third parties (or become
contractually committed do to so), except the following:
6.7.1. Letters of Credit and Guarantees of the Credit Obligations.
6.7.2. Guarantees by the Company or its Subsidiaries of Indebtedness
and other obligations incurred by the Company or its Subsidiaries and
permitted by Section 6.6.
6.8. LIENS. Neither the Company nor any of its Subsidiaries shall create,
incur or enter into, or suffer to be created or incurred or to exist, any Lien
(or become contractually committed to do so), except the following:
6.8.1. Liens on the Credit Security that secure the Credit
Obligations.
6.8.2. Liens to secure taxes, assessments and other governmental
charges, to the extent that payment thereof shall not at the time be
required by Section 6.1.
6.8.3. Deposits or pledges made (a) in connection with, or to secure
payment of, workers' compensation, unemployment insurance, old age pensions
or other social security, (b) in connection with casualty insurance
maintained in accordance with Section 6.3, (c) to secure the performance of
bids, tenders, contracts (other than contracts relating to Financing Debt)
or leases, (d) to secure statutory obligations or surety or appeal bonds,
(e) to secure indemnity, performance or other similar bonds in the ordinary
course of business or (f) in connection with contested amounts to the
extent that payment thereof shall not at that time be required by Section
6.1.
6.8.4. Liens in respect of judgments or awards, to the extent that
such judgments or awards are permitted by Section 6.6.6 but only to the
extent that such Liens are junior to the Liens on the Credit Security
granted to secure the Credit Obligations.
6.8.5. Liens of carriers, warehouses, mechanics and similar Liens, in
each case (a) in existence less than 90 days from the date of creation
thereof or (b) being contested in good faith by the Company or any
Subsidiary in appropriate proceedings (so long as the Company or such
Subsidiary shall, in accordance with GAAP, have set aside on its books
adequate reserves with respect thereto).
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6.8.6. Encumbrances in the nature of (a) zoning restrictions, (b)
easements, (c) restrictions of record on the use of real property, (d)
landlords' and lessors' Liens on rented premises and (e) restrictions on
transfers or assignment of leases, which in each case do not materially
detract from the value of the encumbered property or impair the use thereof
in the business of the Company or any Subsidiary.
6.8.7. Liens constituting (a) purchase money security interests
(including mortgages, conditional sales, Capitalized Leases and any other
title retention or deferred purchase devices), interests in leases or
tangible personal property (other than inventory) existing or created on
the date on which such property is acquired or within 60 days thereafter,
and (b) the renewal, extension or refunding of any security interest
referred to in the foregoing clause (a) in an amount not to exceed the
amount thereof remaining unpaid immediately prior to such renewal,
extension or refunding; PROVIDED, HOWEVER, that (i) each such security
interest shall attach solely to the particular item of property so
acquired, and the principal amount of Indebtedness (including Indebtedness
in respect of Capitalized Lease Obligations) secured thereby shall not
exceed the cost (including all such Indebtedness secured thereby, whether
or not assumed) of such item of property; and (ii) the aggregate principal
amount of all Indebtedness secured by Liens permitted by this Section 6.8.7
shall not exceed the amount permitted by Section 6.6.7.
6.8.8. Restrictions under federal and state securities laws on the
transfer of securities.
6.8.9. The sale of doubtful accounts receivable for collection in the
ordinary course of business.
6.8.10. Liens as in effect on the date hereof described in Exhibit 7.3
(and renewals and replacements thereof) and securing Indebtedness permitted
by Section 6.6.11 (without reducing Liens permitted under the other
provisions of this Section 6.8).
6.8.11. Liens arising from Uniform Commercial Code financing
statements and similar documents filed on a precautionary basis in respect
of operating leases intended by the parties to be true leases.
6.8.12. Liens on the assets of Foreign Subsidiaries to secure
Indebtedness permitted by Section 6.6.13.
6.9. INVESTMENTS AND ACQUISITIONS. Neither the Company nor any of its
Subsidiaries shall have outstanding, acquire or hold any Investment (including
any Investment consisting of
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the acquisition of any business) (or become contractually committed to do so),
except the following:
6.9.1. Investments of the Company and its Subsidiaries in (a) Wholly
Owned Subsidiaries which are Guarantors as of the date hereof or (b)
Persons that have become Wholly Owned Subsidiaries and Guarantors after the
date hereof in accordance with Section 6.9.6; PROVIDED, HOWEVER, that (a)
no such Investment shall involve the transfer by the Company of any
material assets other than cash and (b) loans and advances from a Foreign
Subsidiary to a Domestic Subsidiary must be subordinated to the Credit
Obligations pursuant to an intercompany subordination agreement in
substantially the form of Exhibit 6.9.2.
6.9.2. Intercompany loans and advances from any Wholly Owned
Subsidiary to the Company but in each case only to the extent reasonably
necessary for Consolidated tax planning and working capital management;
PROVIDED, HOWEVER, that loans and advances from a Foreign Subsidiary to the
Company or a Domestic Subsidiary must be subordinated to the Credit
Obligations pursuant to an intercompany subordination agreement in
substantially the form of Exhibit 6.9.2.
6.9.3. Investments in Cash Equivalents. 1.1.1.
6.9.4. Guarantees permitted by Section 6.7.
6.9.5. So long as immediately before and after giving effect thereto
no Default exists, Investments of the Company and its Subsidiaries in
Foreign Subsidiaries that have been previously acquired or created by the
Company and its Subsidiaries; PROVIDED, HOWEVER, that (a) such Investments
shall not involve the transfer of substantial assets from the Company and
its Domestic Subsidiaries to its Foreign Subsidiaries, other than cash and
surplus equipment, and (b) Investments of the Company and its Domestic
Subsidiaries in Foreign Subsidiaries made pursuant to this Section shall
not exceed $2,000,000 at any one time outstanding MINUS the value of assets
transferred to Foreign Subsidiaries pursuant to Section 6.11.6.
6.9.6. The Company and its Subsidiaries may make acquisitions of
businesses in the same or a substantially similar line of business so long
as:
(a) The Company provides written computations and projections
satisfactory to the Agent demonstrating pro forma compliance with
Section 6.5 and the absence of any Default, both immediately
before and after giving effect to such acquisition.
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(b) The aggregate purchase price (including cash, assumed debt,
earnout payments, seller debt, stock issuances and noncompetition
payments) for such acquisition (including any related
acquisitions) is less than $50,000,000.
(c) The Company has demonstrated to the satisfaction of the Agent
that the business to be acquired has a positive adjusted
Consolidated Pro Forma EBITDA on a trailing 12 month basis for
the 12 months most recently ended prior to the proposed
acquisition (with adjustments to Consolidated Pro Forma EBITDA
being normal and customary for transactions of this type and
approved by the Agent).
(d) The Company has provided the Agent at least 15 Banking Days prior
written notice of such acquisition and copies of all letters of
intent and agreements relating thereto.
(e) The Company or one of its Wholly Owned Subsidiaries is the
surviving entity of such acquisition or, in the event of a stock
acquisition, the Company or one of its Wholly Owned Subsidiaries
will own at least 80% of the capital stock, as well as at least
80% of the capital stock entitled to vote generally for the
election of directors, of the acquired entity.
(f) The acquired business, if an acquired or newly created domestic
corporation, will become a Guarantor and pledge its assets to
secure the credit facility. The Company and the other Guarantors
will pledge the stock (up to 66% of voting stock of a foreign
corporation) of the acquired or newly created entity.
(g) The Lenders will have received a customary legal opinion from
special counsel to the Company with respect to the new Guarantor.
6.9.7. Investments outstanding on the date hereof and described in
Exhibit 7.3 (without reducing Investments permitted under the other
provisions of this Section 6.9).
6.9.8. So long as immediately before and after giving effect thereto
no Default exists, Investments in portfolio companies in an aggregate
amount (calculated at original cost, net of any Distributions received in
respect of such Investments) not to exceed $4,000,000 at any one time
outstanding; PROVIDED, HOWEVER, that (a) no single Investment in any such
portfolio company shall exceed $500,000 at any one time outstanding without
the approval of the Required Lenders, which approval shall not be
unreasonably withheld, and (b) as of the date of such Investment, the
Reference
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Leverage Ratio shall not exceed 250% if such Investment is made on or
before December 31, 2001 or 225% if such Investment is made after December
31, 2001, unless the Company shall obtain the approval of the Required
Lenders to make such Investment.
6.10. DISTRIBUTIONS. Neither the Company nor any of its Subsidiaries shall
make any Distribution (or become contractually committed to do so), except the
following:
6.10.1. So long as immediately before and after giving effect thereto
no Default exists, Subsidiaries of the Company may make Distributions to
the Company or any Wholly Owned Subsidiary of the Company and the Company
and its Subsidiaries may make Investments permitted by Section 6.9.
6.10.2. The Company may make Distributions of PIK Interest on the
Debentures in accordance with their terms and, so long as immediately
before and after giving effect thereto no Default exists, the Company may
make cash interest payments on the Debentures equal to the lesser of (a) an
amount equal to the accrued, scheduled, mandatory cash payments of interest
on the Debentures in accordance with their terms, including subordination
terms and (b) an aggregate amount in any year equal to 10% of the
outstanding principal amount of the Debentures at the time of payment.
6.10.3. So long as immediately before and after giving effect thereto
no Default exists, the Company may repurchase Company stock, options to
acquire such stock and Debentures in an aggregate amount not exceeding
$200,000 in any year in cash, as well as any non-cash repurchases of the
Debentures consummated by offsetting corresponding amounts owing to the
Company by such employees, and any repurchases made from the cash proceeds
of exercises under the Company's stock option plans and employee stock
purchase plans.
6.11. ASSET DISPOSITIONS AND MERGERS. Neither the Company nor any of its
Subsidiaries shall merge or enter into a consolidation or sell, lease, exchange,
sell and lease back, sublease or otherwise dispose of any of its assets (or
become contractually committed to do so), except the following:
6.11.1. The Company and any of its Subsidiaries may sell or otherwise
dispose of (a) inventory and Cash Equivalents in the ordinary course of
business, (b) assets (i) that will be replaced in the ordinary course of
business within 12 months by other assets of equal or greater value or (ii)
that are no longer used or useful in the business of the Company or such
Subsidiary, PROVIDED, HOWEVER that the aggregate fair market value (book
value, if greater) of all assets sold under this clause (b) in any fiscal
year shall not be material, (c) doubtful accounts receivable for collection
purposes in the ordinary course of business and (d) Immaterial
Subsidiaries.
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6.11.2. Any Wholly Owned Subsidiary of the Company may merge,
consolidate or be liquidated into the Company or any other Wholly Owned
Subsidiary of the Company so long as after giving effect to any such merger
to which the Company is a party the Company shall be the surviving or
resulting Person.
6.11.3. Licensing or leasing of assets for fair value in the ordinary
course of business.
6.11.4. Nextera Business Performance Solutions Group, Inc. may
liquidate or otherwise dispose of all its interest in Cranberry Hill
Capital.
6.11.5. Mergers or consolidations in connection with acquisitions
permitted by Section 6.9.
6.11.6. The sale, transfer or other disposition of assets from the
Company to any Guarantor or from a Subsidiary to the Company or a
Guarantor; PROVIDED, HOWEVER, that all such sales, transfers or other
dispositions of assets of the Company and its Domestic Subsidiaries to
Foreign Subsidiaries shall not exceed $2,000,000 in the aggregate MINUS the
outstanding amount of Investments in Foreign Subsidiaries made under
Section 6.9.5.
6.11.7. So long as immediately before and after giving effect thereto
no Default exists, dispositions of assets not to exceed $2,500,000
(measured at net book value, except for assets constituting
available-for-sale securities, which shall be measured at the lower of
original cost or market value) for any fiscal year.
6.11.8. Transactions constituting the offset of Indebtedness permitted
by Section 6.10.3.
6.12. ISSUANCE OF STOCK BY SUBSIDIARIES; SUBSIDIARY DISTRIBUTIONS.
6.12.1. ISSUANCE OF STOCK BY SUBSIDIARIES. No Subsidiary shall issue
or sell any shares of its capital stock or other evidence of beneficial
ownership to any Person other than (a) the Company or any Wholly Owned
Subsidiary of the Company, which shares shall have been pledged to the
Agent as part of the Credit Security to the extent required by the
Guarantee and Security Agreement, (b) directors of Subsidiaries as
qualifying shares to the extent required by Legal Requirements and, in the
case of Foreign Subsidiaries, shares required by Legal Requirements to be
held by foreign nationals and (c) pro rata Distributions to shareholders of
non-Wholly Owned Subsidiaries.
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6.12.2. NO RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS. Except for this
Agreement and the Credit Documents, neither the Company nor any Subsidiary
shall enter into or be bound by any agreement (including covenants
requiring the maintenance of specified amounts of net worth or working
capital) restricting the right of any Subsidiary to make Distributions or
extensions of credit to the Company (directly or indirectly through another
Subsidiary).
6.13. VOLUNTARY PREPAYMENTS OF OTHER INDEBTEDNESS. Neither the Company nor
any of its Subsidiaries shall make any voluntary prepayment of principal of or
interest on any Financing Debt (other than the Credit Obligations) or make any
voluntary redemptions or repurchases of Financing Debt (other than the Credit
Obligations), in each case except in order to facilitate a refinancing of
Indebtedness permitted by Sections 6.6 or 6.10.3.
6.14. DERIVATIVE CONTRACTS. Neither the Company nor any of its Subsidiaries
shall enter into any Hedge Agreement or other financial or commodity derivative
contracts except to provide hedge protection for an underlying economic
transaction in the ordinary course of business.
6.15. NEGATIVE PLEDGE CLAUSES. Neither the Company nor any of its
Subsidiaries shall enter into any agreement, instrument, deed or lease which
prohibits or limits the ability of the Company or any of its Subsidiaries to
create, incur, assume or suffer to exist any Lien upon any of their respective
properties, assets or revenues, whether now owned or hereafter acquired, or
which requires the grant of any collateral for such obligation if collateral is
granted for another obligation, except the following:
6.15.1. This Agreement and the other Credit Documents.
6.15.2. Covenants in documents creating, or that could create, Liens
permitted by Section 6.8 prohibiting further or any, as the case may be,
Liens on the assets encumbered thereby.
6.16. ERISA, ETC. Each of the Company and its Subsidiaries shall comply,
and shall cause all ERISA Group Persons to comply, in all material respects,
with the provisions of ERISA and the Code applicable to each Plan. Each of the
Company and its Subsidiaries shall meet, and shall cause all ERISA Group Persons
to meet, all minimum funding requirements applicable to them with respect to any
Plan pursuant to section 302 of ERISA or section 412 of the Code, without giving
effect to any waivers of such requirements or extensions of the related
amortization periods which may be granted. At no time shall the Accumulated
Benefit Obligations under any Plan that is not a Multiemployer Plan exceed the
fair market value of the assets of such Plan allocable to such benefits by more
than $500,000. The Company and its Subsidiaries shall not withdraw, and shall
cause all other ERISA Group Persons not to withdraw, in whole or in part, from
any Multiemployer Plan so as to give rise to withdrawal
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liability exceeding $500,000 in the aggregate. At no time shall the actuarial
present value of unfunded liabilities for post-employment health care benefits
(other than COBRA continuation coverage benefits), whether or not provided under
a Plan, calculated in a manner consistent with Statement No. 106 of the
Financial Accounting Standards Board, exceed $500,000.
6.17. TRANSACTIONS WITH AFFILIATES. Neither the Company nor any of its
Subsidiaries shall effect any transaction with any of their respective
Affiliates (except for the Company and its Subsidiaries) on a basis less
favorable to the Company and its Subsidiaries than would be the case if such
transaction had been effected with a non-Affiliate.
6.18. RESTRICTED OPERATIONS OF CRANBERRY HILL CAPITAL. Cranberry Hill
Capital will conduct no operations other than owning Investments in former
customers of Symmetrix, Inc. (now known as Nextera Business Performance
Solutions, Inc.) for the benefit of present and former employees of Symmetrix,
Inc. and activities incidental thereto. Cranberry Hill Capital will own no
material assets other than such Investments and cash expected to be spent or
distributed within 90 days.
7. REPRESENTATIONS AND WARRANTIES. In order to induce the Lenders to extend
credit to the Company hereunder, each of the Company and the other Guarantors
jointly and severally represents and warrants as follows:
7.1. ORGANIZATION AND BUSINESS.
7.1.1. THE COMPANY. The Company is a duly organized and validly
existing corporation, in good standing under the laws of Delaware, with all
power and authority, corporate or otherwise, necessary to (a) enter into
and perform this Agreement and each other Credit Document to which it is
party, (b) incur the Credit Obligations, (c) grant the Agent for the
benefit of the Lenders the security interests in the Credit Security owned
by it to secure the Credit Obligations and (d) own its properties and carry
on the business now conducted or proposed to be conducted by it. Certified
copies of the Charter and By-laws of the Company have been previously
delivered to the Agent and are correct and complete. Exhibit 7.1, as from
time to time hereafter supplemented in accordance with Sections 6.4.1 and
6.4.2, sets forth, as of the later of the date hereof or the end of the
most recent fiscal quarter for which financial statements are required to
be furnished in accordance with such Sections, (i) the jurisdiction of
incorporation of the Company, (ii) the address of the Company's principal
executive office and chief place of business, (iii) each name, including
any trade name, under which the Company conducts its business and (iv) the
jurisdictions in which the Company owns material real or tangible personal
property.
7.1.2. SUBSIDIARIES. Each Subsidiary of the Company is duly organized,
validly existing and in good standing under the laws of the jurisdiction in
which it is
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organized, with all power and authority, corporate or otherwise, necessary
to (a) enter into and perform this Agreement and each other Credit Document
to which it is party, (b) guarantee the Credit Obligations, (c) grant the
Agent for the benefit of the Lenders the security interest in the Credit
Security owned by such Subsidiary to secure the Credit Obligations and (d)
own its properties and carry on the business now conducted or proposed to
be conducted by it. Certified copies of the Charter and By-laws of each
Subsidiary of the Company have been previously delivered to the Agent and
are correct and complete. Exhibit 7.1, as from time to time hereafter
supplemented in accordance with Sections 6.4.1 and 6.4.2, sets forth, as of
the later of the date hereof or the end of the most recent fiscal quarter
for which financial statements are required to be furnished in accordance
with such Sections, (i) the name and jurisdiction of organization of each
Subsidiary of the Company, (ii) the address of the chief executive office
and principal place of business of each such Subsidiary, (iii) each name
under which each such Subsidiary conducts its business, (iv) each
jurisdiction in which each such Subsidiary owns material real or tangible
personal property, and (v) the number of authorized and issued shares and
ownership of each such Subsidiary.
7.1.3. QUALIFICATION. Each of the Company and its Subsidiaries is duly
and legally qualified to do business as a foreign corporation or other
entity and is in good standing in each state or jurisdiction in which such
qualification is required and is duly authorized, qualified and licensed
under all laws, regulations, ordinances or orders of public authorities, or
otherwise, to carry on its business in the places and in the manner in
which it is conducted, except for failures to be so qualified, authorized
or licensed which would not in the aggregate result, or create a material
risk of resulting, in any Material Adverse Change.
7.1.4. CAPITALIZATION. Except as set forth in Exhibit 7.1, as from
time to time hereafter supplemented in accordance with Sections 6.4.1 and
6.4.2, no options, warrants, conversion rights, preemptive rights or other
statutory or contractual rights to purchase shares of capital stock or
other securities of any Subsidiary now exist, nor has any Subsidiary
authorized any such right, nor is any Subsidiary obligated in any other
manner to issue shares of its capital stock or other securities.
7.2. FINANCIAL STATEMENTS AND OTHER INFORMATION; MATERIAL AGREEMENTS.
7.2.1. FINANCIAL STATEMENTS AND OTHER INFORMATION. The Company has
previously furnished to the Agent copies of the following:
(1) The audited Consolidated and unaudited Consolidating balance
sheets of the Company and its Subsidiaries as at December 31 in each of
1996, 1997 and 1998 and the audited Consolidated and unaudited
Consolidating statements of income and the audited Consolidated statements
of changes in shareholders' equity and of cash flows of
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the Company and its Subsidiaries for the fiscal years (or the fiscal
quarter, in the case of June 30, 1999) of the Company then ended.
(2) The unaudited Consolidated balance sheet of the Company and its
Subsidiaries as at June 30, 1999 and the unaudited Consolidated statements
of income and of cash flows of the Company and its Subsidiaries for the
fiscal quarter and the portion of the fiscal year then ended.
(3) The three-year financial and operational projections for the
Company and its Subsidiaries dated September 1999.
(4) Calculations with respect to the Computation Covenants as of the
end of the most recent fiscal quarter preceding the date hereof on a pro
forma basis giving effect to the incurrence of the Credit Obligations.
(5) The registration statement on Form S-1 of the Company, together
with all amendments thereto, filed by the Company with the Securities and
Exchange Commission in connection with its initial public offering of Class
A Common Stock in May 1999 (the "PROSPECTUS").
The audited Consolidated financial statements (including the notes
thereto) referred to in clause (a) above were prepared in accordance with
GAAP and fairly present in all material respects the financial position of
the Company and its Subsidiaries on a Consolidated basis at the respective
dates thereof and the results of their operations for the periods covered
thereby. The unaudited Consolidating financial statements referred to in
clause (a) above and the unaudited Consolidated financial statements
referred to in clause (b) above were prepared in accordance with GAAP and
fairly present in all material respects the financial position of the
Company and its Subsidiaries at the respective dates thereof and the
results of their operations for the periods covered thereby, subject to
normal year-end audit adjustments and the addition of footnotes in the case
of interim financial statements. Neither the Company nor any of its
Subsidiaries has any known contingent liability material to the Company and
its Subsidiaries on a Consolidated basis which is not reflected in the
balance sheets referred to in clauses (a) or (b) above (or delivered
pursuant to Sections 6.4.1 or 6.4.2) or in the notes thereto.
In the Company's judgment, the financial and operational projections
referred to in clause (c) above constitute a reasonable basis as of the
Initial Closing Date for the assessment of the future performance of the
Company and its Subsidiaries during the periods indicated therein, it being
understood that any projected financial information represents an estimate,
based on various assumptions, of future results of operations which may or
may not in fact occur.
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The Prospectus contained all information required to be contained
therein and otherwise complied in all material respects with the Securities
Act.
7.2.2. MATERIAL AGREEMENTS. The Company has previously furnished to
the Agent correct and complete copies, including all exhibits, schedules
and amendments thereto, of the agreements and instruments, each as in
effect on the date hereof, listed in Exhibit 7.2.2, which constitute all
agreements and instruments material to the Company and its Subsidiaries on
a Consolidated basis (the "MATERIAL AGREEMENTS").
7.3. AGREEMENTS RELATING TO FINANCING DEBT, INVESTMENTS, ETC. Exhibit 7.3,
as from time to time hereafter supplemented in accordance with Sections 6.4.1
and 6.4.2, sets forth:
7.3.1. The amounts (as of the dates indicated in Exhibit 7.3, as so
supplemented) of all Financing Debt of the Company and its Subsidiaries and
all agreements which relate to such Financing Debt.
7.3.2. All Liens and Guarantees with respect to such Financing Debt.
7.3.3. Certain material Investments outstanding as of the date hereof
and all agreements which directly or indirectly require the Company or any
Subsidiary to make any Investment.
7.3.4. All trademarks, tradenames, service marks, service names and
patents owned by the Company and its Subsidiaries that are registered with
the federal Patent and Trademark Office (or with respect to which
applications for such registration have been filed).
7.3.5. All copyrights owned by the Company and its Subsidiaries that
are registered with the federal Copyright Office.
7.3.6. All bank and deposit accounts owned by the Company and its
Subsidiaries.
The Company has furnished the Agent correct and complete copies of any
agreements described above in this Section 7.3 requested by the Agent.
7.4. CHANGES IN CONDITION. Between June 30, 1999 and the date hereof, no
Material Adverse Change has occurred and between June 30, 1999 and the date
hereof, neither the Company nor any Subsidiary of the Company has entered into
any material transaction outside
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the ordinary course of business except for the transactions contemplated by this
Agreement and the Material Agreements and as otherwise disclosed in writing to
the Agent.
7.5. TITLE TO ASSETS. The Company and its Subsidiaries have good and
marketable title to all material assets necessary for or used in the operations
of their business as now conducted by them and reflected in the most recent
balance sheet referred to in Section 7.2.1 (or the balance sheet most recently
furnished to the Agent pursuant to Sections 6.4.1 or 6.4.2), and to all assets
acquired subsequent to the date of such balance sheet, subject to no Liens
except for Liens permitted by Section 6.8 and except for assets disposed of as
permitted by Section 6.11.
7.6. OPERATIONS IN CONFORMITY WITH LAW, ETC. The operations of the Company
and its Subsidiaries as now conducted or proposed to be conducted are not in
violation of, nor is the Company or its Subsidiaries in default under, any Legal
Requirement presently in effect, except for such violations and defaults as do
not and will not, in the aggregate, result, or create a material risk of
resulting, in any Material Adverse Change. The Company has received no notice of
any such violation or default and has no knowledge of any basis on which the
operations of the Company or its Subsidiaries, as now conducted and as currently
proposed to be conducted after the date hereof, would be held so as to violate
or to give rise to any such violation or default.
7.7. LITIGATION. Except as set forth on Exhibit 7.7, no litigation, at law
or in equity, or any proceeding before any court, board or other governmental or
administrative agency or any arbitrator is pending or, to the knowledge of the
Company or any Guarantor, threatened which involves any material risk of any
final judgment, order or liability which, after giving effect to any applicable
insurance, has resulted, or creates a material risk of resulting, in any
Material Adverse Change or which seeks to enjoin the consummation, or which
questions the validity, of any of the transactions contemplated by this
Agreement or any other Credit Document. Except as set forth on Exhibit 7.7, no
judgment, decree or order of any court, board or other governmental or
administrative agency or any arbitrator has been issued against or binds the
Company or any of its Subsidiaries which has resulted, or creates a material
risk of resulting, in any Material Adverse Change.
7.8. AUTHORIZATION AND ENFORCEABILITY. Each of the Company and each other
Obligor has taken all corporate action required to execute, deliver and perform
this Agreement and each other Credit Document to which it is party. No consent
of stockholders of the Company is necessary in order to authorize the execution,
delivery or performance of this Agreement or any other Credit Document to which
the Company is party. Each of this Agreement and each other Credit Document
constitutes the legal, valid and binding obligation of each Obligor party
thereto and is enforceable against such Obligor in accordance with its terms
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally.
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7.9. NO LEGAL OBSTACLE TO AGREEMENTS. Neither the execution and delivery of
this Agreement or any other Credit Document, nor the making of any borrowings
hereunder, nor the guaranteeing of the Credit Obligations, nor the securing of
the Credit Obligations with the Credit Security, nor the consummation of any
transaction referred to in or contemplated by this Agreement or any other Credit
Document, nor the fulfillment of the terms hereof or thereof or of any other
agreement, instrument, deed or lease contemplated by this Agreement or any other
Credit Document has constituted or resulted in or will constitute or result in:
(1) any breach or termination of the provisions of any agreement,
instrument, deed or lease which is material to the Company and its
Subsidiaries, taken as a whole, or which would have a material adverse
effect on the rights of the Lenders under the Credit Documents, to which
the Company, any of its Subsidiaries or any other Obligor is a party or by
which it is bound, or of the Charter or By-laws of the Company, any of its
Subsidiaries or any other Obligor;
(2) the violation of any law, statute, judgment, decree or
governmental order, rule or regulation applicable to the Company, any of
its Subsidiaries or any other Obligor;
(3) the creation under any agreement, instrument, deed or lease of
any Lien (other than Liens on the Credit Security which secure the Credit
Obligations) upon any of the assets of the Company, any of its Subsidiaries
or any other Obligor; or
(4) any redemption, retirement or other repurchase obligation of the
Company, any of its Subsidiaries or any other Obligor under any Charter,
By-law, agreement, instrument, deed or lease.
No approval, authorization or other action by, or declaration to or filing with,
any governmental or administrative authority or any other Person is required to
be obtained or made by the Company, any of its Subsidiaries or any other Obligor
in connection with the execution, delivery and performance of this Agreement or
any other Credit Document, the transactions contemplated hereby or thereby, the
making of any borrowing hereunder, the guaranteeing of the Credit Obligations or
the securing of the Credit Obligations with the Credit Security (other than
filings necessary to perfect the Agent's security interest in the Credit
Security).
7.10. DEFAULTS. Neither the Company nor any of its Subsidiaries is in
default under any provision of its Charter or By-laws or of this Agreement or
any other Credit Document. Neither the Company nor any of its Subsidiaries is in
default under any provision of any agreement, instrument, deed or lease to which
it is party or by which it or its property is bound so as to result, or create a
material risk of resulting, in any Material Adverse Change.
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7.11. LICENSES, ETC. The Company and its Subsidiaries have all patents,
patent applications, patent licenses, patent rights, trademarks, trademark
rights, trade names, trade name rights, copyrights, licenses, franchises,
permits, authorizations and other rights as are reasonably necessary for the
conduct of the business of the Company and its Subsidiaries as now conducted by
them. All of the foregoing are in full force and effect in all material
respects, and each of the Company and its Subsidiaries is in substantial
compliance with the foregoing without any known conflict with the valid rights
of others which has resulted, or creates a material risk of resulting, in any
Material Adverse Change. No event has occurred which permits, or after notice or
lapse of time or both would permit, the revocation or termination of any such
license, franchise or other right or which affects the rights of any of the
Company and its Subsidiaries thereunder so as to result, or to create a material
risk of resulting, in any Material Adverse Change.
7.12. TAX RETURNS. Except as set forth on Exhibit 7.12, each of the Company
and its Subsidiaries has filed all material tax and information returns which
are required to be filed by it and has paid, or made adequate provision for the
payment of, all taxes which have or may become due pursuant to such returns or
to any assessment received by it, other than taxes and assessments being
contested by the Company and its Subsidiaries in good faith by appropriate
proceedings and for which adequate reserves have been taken in accordance with
GAAP. Except as set forth on Exhibit 7.12, neither the Company nor any of its
Subsidiaries knows of any material additional assessments or any basis therefor.
The Company reasonably believes that the charges, accruals and reserves on the
books of the Company and its Subsidiaries in respect of taxes or other
governmental charges are adequate.
7.13. CERTAIN BUSINESS REPRESENTATIONS.
7.13.1. LABOR RELATIONS. No dispute or controversy between the Company
or any of its Subsidiaries and any of their respective employees has
resulted, or is reasonably likely to result, in any Material Adverse
Change, and neither the Company nor any of its Subsidiaries anticipates
that its relationships with its unions or employees will result, or are
reasonably likely to result, in any Material Adverse Change. The Company
and each of its Subsidiaries is in compliance in all material respects with
all federal and state laws with respect to (a) non-discrimination in
employment with which the failure to comply, in the aggregate, has
resulted, or creates a material risk of resulting, in a Material Adverse
Change and (b) the payment of wages.
7.13.2. ANTITRUST. Each of the Company and its Subsidiaries is in
compliance in all material respects with all federal and state antitrust
laws relating to its business and the geographic concentration of its
business.
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7.13.3. YEAR 2000 ISSUES. Based on a review of the operations of the
Company and its Subsidiaries as they relate to the processing, storage and
retrieval of data, the Company does not believe that a Material Adverse
Change is reasonably likely to occur as a result of computer software and
hardware that will not function with respect to periods commencing January
1, 2000 at least as effectively as with respect to periods ending on or
prior to December 31, 1999.
7.13.4. FUTURE EXPENDITURES. Neither the Company nor any of its
Subsidiaries anticipate that the future expenditures, if any, by the
Company and its Subsidiaries needed to meet the provisions of any federal,
state or foreign governmental statutes, orders, rules or regulations will
be so burdensome as to result, or create a material risk of resulting, in
any Material Adverse Change.
7.14. PENSION PLANS. Each Plan (other than a Multiemployer Plan) and, to
the knowledge of the Company and its Subsidiaries, each Multiemployer Plan is in
material compliance with the applicable provisions of ERISA and the Code. Each
Multiemployer Plan and each Plan that constitutes a "defined benefit plan" (as
defined in ERISA) are set forth in Exhibit 7.14 (as from time to time hereafter
supplemented in accordance with Sections 6.4.1 and 6.4.2). Each ERISA Group
Person has met all of the material funding standards applicable to all Plans
that are not Multiemployer Plans, and no condition exists which would permit the
institution of proceedings to terminate any Plan that is not a Multiemployer
Plan under section 4042 of ERISA. To the knowledge of the Company and each
Subsidiary, no Plan that is a Multiemployer Plan is currently insolvent or in
reorganization or has been terminated within the meaning of ERISA.
7.15. ENVIRONMENTAL REGULATIONS.
7.15.1. ENVIRONMENTAL COMPLIANCE. Each of the Company and its
Subsidiaries is in compliance in all material respects with the Clean Air
Act, the Federal Water Pollution Control Act, the Marine Protection
Research and Sanctuaries Act, RCRA, CERCLA and any other Environmental Law
in effect in any jurisdiction in which any properties of the Company or any
of its Subsidiaries are located or where any of them conducts its business,
and with all applicable published rules and regulations (and applicable
standards and requirements) of the federal Environmental Protection Agency
and of any similar agencies in states or foreign countries in which the
Company or its Subsidiaries conducts its business other than those which in
the aggregate have not resulted, and do not create a material risk of
resulting, in a Material Adverse Change.
7.15.2. ENVIRONMENTAL CONDITION OF PROPERTIES. To the knowledge of the
Company, none of the properties owned or leased by the Company or any of
its Subsidiaries has been used as a treatment, storage or disposal site for
Hazardous
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Material, other than as disclosed in Exhibit 7.15 (as from time to time
hereafter supplemented in accordance with Sections 6.4.1 and 6.4.2). To the
knowledge of the Company, no Hazardous Material is present in any real
property currently or formerly owned or operated by the Company or any of
its Subsidiaries except that which has not resulted, and does not create a
material risk of resulting, in a Material Adverse Change.
7.16. GOVERNMENT REGULATION; MARGIN STOCK.
7.16.1. GOVERNMENT REGULATION. Neither the Company nor any of its
Subsidiaries, nor any Person controlling the Company or any of its
Subsidiaries or under common control with the Company or any of its
Subsidiaries, is subject to regulation under the Public Utility Holding
Company Act of 1935, the Federal Power Act, the Investment Company Act, the
Interstate Commerce Act or any statute or regulation which regulates the
incurring by the Company or any of its Subsidiaries of Financing Debt as
contemplated by this Agreement and the other Credit Documents.
7.16.2. MARGIN STOCK. Except as set forth on Exhibit 7.16.2, neither
the Company nor any of its Subsidiaries owns any Margin Stock; PROVIDED,
HOWEVER, that the value of all such Margin Stock owned by the Company and
its Subsidiaries does not exceed 25% of the book value of the total assets
of the Company and its Subsidiaries.
7.17. DISCLOSURE. Neither this Agreement nor any other Credit Document nor
any financial statement, report, notice, mortgage, assignment or certificate,
taken as a whole, furnished or to be furnished to the Lenders or the Agent by or
on behalf of the Company or any of its Subsidiaries in connection with the
transactions contemplated hereby or by such Credit Document contains any untrue
statement of material fact or omits to state a material fact necessary in order
to make the statements contained herein or therein not misleading in light of
the circumstances under which they were made.
8. DEFAULTS.
8.1. EVENTS OF DEFAULT. The following events are referred to as "EVENTS OF
DEFAULT":
8.1.1. PAYMENT. The Company shall fail to make any payment in respect
of: (a) interest or any fee on or in respect of any of the Credit
Obligations owed by it as the same shall become due and payable, and such
failure shall continue for a period of three Banking Days, or (b) any
Credit Obligation with respect to payments made by any Letter of Credit
Issuer under any Letter of Credit or any draft drawn thereunder within
three Banking Days after demand therefor by such Letter of Credit Issuer
(whether by loan, cash or otherwise) or (c) principal of any of the Credit
Obligations owed by it as the same shall become due, whether at maturity or
by acceleration or otherwise.
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8.1.2. SPECIFIED COVENANTS. The Company or any of its Subsidiaries
shall fail to perform or observe any of the provisions of Section 6.4.5 or
Sections 6.5 through 6.17.
8.1.3. OTHER COVENANTS. The Company, any of its Subsidiaries or any
other Obligor shall fail to perform or observe any other covenant,
agreement or provision to be performed or observed by it under this
Agreement or any other Credit Document, and such failure shall not be
rectified or cured to the written satisfaction of the Required Lenders
within 30 days after the earlier of (a) notice thereof by the Agent to the
Company or (b) a Financial Officer shall have actual knowledge thereof.
8.1.4. REPRESENTATIONS AND WARRANTIES. Any representation or warranty
of or with respect to the Company, any of its Subsidiaries or any other
Obligor made to the Lenders or the Agent in, pursuant to or in connection
with this Agreement or any other Credit Document, or in any financial
statement, report, notice, mortgage, assignment or certificate delivered to
the Agent or any of the Lenders by the Company, any of its Subsidiaries or
any other Obligor in connection herewith or therewith, shall be false in
any material respect on the date as of which it was made.
8.1.5. MATERIAL FINANCING DEBT CROSS DEFAULT, ETC.
(1) The Company or any of its Subsidiaries shall fail to make any
payment when due (after giving effect to any applicable grace periods) in
respect of any Material Financing Debt;
(2) the Company or any of its Subsidiaries shall fail to perform or
observe the terms of any agreement or instrument relating to any Material
Financing Debt, and such failure shall continue, without having been duly
cured, waived or consented to, beyond the period of grace, if any,
specified in such agreement or instrument, and such failure shall permit
the acceleration of such Material Financing Debt;
(3) all or any part of any Material Financing Debt of the Company or
any of its Subsidiaries shall be accelerated or shall become due or payable
prior to its stated maturity (except with respect to voluntary prepayments
thereof) for any reason whatsoever;
(4) any Lien on any property of the Company or any of its
Subsidiaries securing any Material Financing Debt shall be enforced by
foreclosure or similar action; or
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(5) any holder of any Material Financing Debt shall exercise any
right of rescission with respect to the issuance thereof or put, mandatory
prepayment or repurchase rights against any Obligor with respect to such
Material Financing Debt (other than any such rights that may be satisfied
with "payment in kind" notes or other similar securities).
8.1.6. OWNERSHIP; LIQUIDATION; ETC. Except as permitted by Section
6.11:
(1) the Company shall cease to own, directly or indirectly, all the
capital stock of its Subsidiaries, except (i) to the extent permitted by
Section 6.12.1, (ii) shares of Sibson Canada owned by third parties as of
the date hereof and (iii) as permitted pursuant to Section 6.9; or
(2) Knowledge Enterprises and its Affiliates shall cease to own
voting stock necessary to elect a majority of the members of the Company's
board of directors, other than as a result of stock issuances by the
Company; or
(3) a majority of the board of directors of the Company shall be
neither (i) nominated or approved in advance by the board of directors of
the Company nor (ii) appointed or approved in advance by directors so
nominated or approved; or
(4) any Person, together with "affiliates" and "associates" of such
Person within the meaning of Rule 12b-2 of the Exchange Act, or any "group"
including such Person under sections 13(d) and 14(d) of the Exchange Act,
other than the Persons described in paragraph (b) above, shall acquire
after the date hereof (i) beneficial ownership within the meaning of Rule
13d-3 of the Exchange Act of 33% or more of either the voting stock or
total equity capital of the Company or (ii) direct or indirect control of
the Company through a shareholder, voting or similar agreement or
arrangement; or
(5) except for Immaterial Subsidiaries, the Company or any of its
Subsidiaries or any other Obligor shall initiate any action to dissolve,
liquidate or otherwise terminate its existence.
8.1.7. ENFORCEABILITY, ETC. Any Credit Document shall cease for any
reason (other than the scheduled termination thereof in accordance with its
terms) to be enforceable in accordance with its terms or in full force and
effect; or any party to any Credit Document shall so assert in a judicial
or similar proceeding; or the security interests created by this Agreement
or any other Credit Documents shall cease to be enforceable and of the same
effect and priority purported to be created hereby, except to the extent
that any such loss of perfection or priority results (a) from the failure
of
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the Agent to maintain possession of certificates representing securities
pledged under the Credit Documents or (b) from any gross negligence or
willful misconduct of the Agent.
8.1.8. JUDGMENTS. A final judgment (a) which, with other outstanding
final judgments against the Company and its Subsidiaries, exceeds an
aggregate of $500,000 in excess of applicable insurance coverage shall be
rendered against the Company or any of its Subsidiaries, or (b) which
grants injunctive relief that results, or creates a material risk of
resulting, in a Material Adverse Change and in either case if (i) within 45
days after entry thereof, such judgment shall not have been discharged or
execution thereof stayed pending appeal or (ii) within 45 days after the
expiration of any such stay, such judgment shall not have been discharged.
8.1.9. ERISA. Any "reportable event" (as defined in section 4043 of
ERISA) shall have occurred that reasonably could be expected to result in
termination of a Plan or the appointment by the appropriate United States
District Court of a trustee to administer any Plan or the imposition of a
Lien in favor of a Plan; or any ERISA Group Person shall fail to pay when
due amounts aggregating in excess of $500,000 which it shall have become
liable to pay to the PBGC or to a Plan under Title IV of ERISA; or notice
of intent to terminate a Plan shall be filed under Title IV of ERISA by any
ERISA Group Person or administrator; or the PBGC shall institute
proceedings under Title IV of ERISA to terminate or to cause a trustee to
be appointed to administer any Plan or a proceeding shall be instituted by
a fiduciary of any Plan against any ERISA Group Person to enforce section
515 or 4219(c)(5) of ERISA and such proceeding shall not have been
dismissed within 45 days thereafter; or a condition shall exist by reason
of which the PBGC would be entitled to obtain a decree adjudicating that
any Plan must be terminated.
8.1.10. BANKRUPTCY, ETC. The Company, any of its Subsidiaries or any
other Obligor shall:
(1) commence a voluntary case under the Bankruptcy Code or authorize,
by appropriate proceedings of its board of directors or other governing
body, the commencement of such a voluntary case;
(2) (i) have filed against it a petition commencing an involuntary
case under the Bankruptcy Code that shall not have been dismissed within 60
days after the date on which such petition is filed, or (ii) file an answer
or other pleading within such 60-day period admitting or failing to deny
the material allegations of such a petition or seeking, consenting to or
acquiescing in the relief therein provided, or (iii) have entered against
it an order for relief in any involuntary case commenced under the
Bankruptcy Code;
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(3) seek relief as a debtor under any applicable law, other than the
Bankruptcy Code, of any jurisdiction relating to the liquidation or
reorganization of debtors or to the modification or alteration of the
rights of creditors, or consent to or acquiesce in such relief;
(4) have entered against it an order by a court of competent
jurisdiction (i) finding it to be bankrupt or insolvent, (ii) ordering or
approving its liquidation or reorganization as a debtor or any modification
or alteration of the rights of its creditors or (iii) assuming custody of,
or appointing a receiver or other custodian for, all or a substantial
portion of its property; or
(5) make an assignment for the benefit of, or enter into a
composition with, its creditors, or appoint, or consent to the appointment
of, or suffer to exist a receiver or other custodian for, all or a
substantial portion of its property.
8.2. CERTAIN ACTIONS FOLLOWING AN EVENT OF DEFAULT. If any one or more
Events of Default shall occur and be continuing, then in each and every such
case:
8.2.1. TERMINATE OBLIGATION TO EXTEND CREDIT. Upon written request of
the Required Lenders, the Agent shall terminate the obligations of the
Lenders to make any further extensions of credit under the Credit Documents
by furnishing notice of such termination to the Company; PROVIDED, HOWEVER,
that if a Bankruptcy Default shall have occurred, the obligations of the
Lenders to make any further extensions of credit under the Credit Documents
shall automatically terminate.
8.2.2. SPECIFIC PERFORMANCE; EXERCISE OF RIGHTS. Upon written request
of the Required Lenders, the Agent shall proceed to protect and enforce the
Lenders' rights by suit in equity, action at law and/or other appropriate
proceeding, either for specific performance of any covenant or condition
contained in this Agreement or any other Credit Document (other than Hedge
Agreements) or in any instrument or assignment delivered to the Lenders
pursuant to this Agreement or any other Credit Document (other than Hedge
Agreements), or in aid of the exercise of any power granted in this
Agreement or any other Credit Document (other than Hedge Agreements) or any
such instrument or assignment.
8.2.3. ACCELERATION. Upon written request of the Required Lenders, the
Agent shall by notice in writing to the Company (a) declare all or any part
of the unpaid balance of the Credit Obligations (other than amounts under
Hedge Agreements) then outstanding to be immediately due and payable, and
(b) require the Company immediately to deposit with the Agent in cash an
amount equal to the then Letter of Credit Exposure (which cash shall be
held and applied as provided in Section 4.4), and thereupon such unpaid
balance or part thereof and such amount equal to the Letter of
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Credit Exposure shall become so due and payable without presentation,
protest or further demand or notice of any kind, all of which are hereby
expressly waived; PROVIDED, HOWEVER, that if a Bankruptcy Default shall
have occurred, the unpaid balance of the Credit Obligations (other than
amounts under Hedge Agreements) shall automatically become immediately due
and payable.
8.2.4. ENFORCEMENT OF PAYMENT; CREDIT SECURITY; SETOFF. Upon written
request of the Required Lenders, the Agent shall proceed to enforce payment
of the Credit Obligations in such manner as it may elect, to cancel, or
instruct other Letter of Credit Issuers to cancel, any outstanding Letters
of Credit which permit the cancellation thereof and to realize upon any and
all rights in the Credit Security. The Lenders may offset and apply toward
the payment of the Credit Obligations (and/or toward the curing of any
Event of Default) any Indebtedness from the Lenders to the respective
Obligors, including any Indebtedness represented by deposits in any account
maintained with the Lenders, regardless of the adequacy of any security for
the Credit Obligations. The Lenders shall have no duty to determine the
adequacy of any such security in connection with any such offset.
8.2.5. CUMULATIVE REMEDIES. To the extent not prohibited by applicable
law which cannot be waived, all of the Lenders' rights hereunder and under
each other Credit Document shall be cumulative.
8.3. ANNULMENT OF DEFAULTS. Once an Event of Default has occurred, such
Event of Default shall be deemed to exist and be continuing for all purposes of
the Credit Documents (other than Hedge Agreements) until the Required Lenders or
the Agent (with the consent of the Required Lenders) shall have waived such
Event of Default in writing, stated in writing that the same has been cured to
such Lenders' reasonable satisfaction or entered into an amendment to this
Agreement which by its express terms cures such Event of Default, at which time
such Event of Default shall no longer be deemed to exist or to have continued.
No such action by the Lenders or the Agent shall extend to or affect any
subsequent Event of Default or impair any rights of the Lenders upon the
occurrence thereof. The making of any extension of credit during the existence
of any Default or Event of Default shall not constitute a waiver thereof.
8.4. WAIVERS. To the extent that such waiver is not prohibited by the
provisions of applicable law that cannot be waived, each of the Company and the
other Obligors waives:
(1) all presentments, demands for performance, notices of
nonperformance (except to the extent required by this Agreement or any
other Credit Document), protests, notices of protest and notices of
dishonor;
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(2) any requirement of diligence or promptness on the part of the
Agent or any Lender in the enforcement of its rights under this Agreement
or any other Credit Document;
(3) any and all notices of every kind and description which may be
required to be given by any statute or rule of law; and
(4) any defense (other than indefeasible payment in full) which it
may now or hereafter have with respect to its liability under this
Agreement or any other Credit Document or with respect to the Credit
Obligations.
9. EXPENSES; INDEMNITY.
9.1. EXPENSES. Whether or not the transactions contemplated hereby shall be
consummated, the Company will pay:
(1) all reasonable expenses of the Agent and the Syndication Agent
(including the out-of-pocket expenses related to forming the group of
Lenders and reasonable fees and disbursements of the counsel to the Agent
and the Syndication Agent) in connection with the negotiation, preparation
and duplication of this Agreement and each other Credit Document,
examinations by, and reports of, the Agent's commercial financial
examiners, fixed asset appraisers and environmental consultants, the
transactions contemplated hereby and thereby and amendments, waivers,
consents and other operations hereunder and thereunder;
(2) all recording and filing fees and transfer and documentary stamp
and similar taxes at any time payable in respect of this Agreement, any
other Credit Document, any Credit Security or the incurrence of the Credit
Obligations; and
(3) all other reasonable expenses incurred by the Agent, the Lenders
or the holder of any Credit Obligation in connection with the enforcement
of any rights hereunder or under any other Credit Document or any work-out
negotiations relating to the Credit Obligations, including costs of
collection and reasonable attorneys' fees (including a reasonable allowance
for the hourly cost of attorneys employed by the Lenders on a salaried
basis) and expenses.
9.2. GENERAL INDEMNITY. The Company shall indemnify the Lenders and the
Agent and hold them harmless from any liability, loss or damage resulting from
the violation by the Company of Section 2.4. In addition, the Company shall
indemnify each Lender, the Agent, the Syndication Agent, each of the Lenders' or
the Agent's or the Syndication Agent's directors, officers, employees, agents,
attorneys, accountants, consultants and each Person, if any, who controls any
Lender or the Agent (each Lender, the Agent and each of such
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directors, officers, employees, agents, attorneys, accountants, consultants and
control Persons is referred to as an "INDEMNIFIED PARTY") and hold each of them
harmless from and against any and all claims, damages, liabilities and
reasonable expenses (including reasonable fees and disbursements of counsel with
whom any Indemnified Party may consult in connection therewith and all
reasonable expenses of litigation or preparation therefor) which any Indemnified
Party may incur or which may be asserted against any Indemnified Party relating
to, arising out of or by reason of this Agreement or any other Credit Document
in connection with (a) the Indemnified Party's compliance with or contest of any
subpoena or other process issued against it in any proceeding involving the
Company or any of its Subsidiaries or their Affiliates, (b) any litigation or
investigation involving the Company, any of its Subsidiaries or their
Affiliates, or any officer, director or employee thereof, (c) the existence or
exercise of any security rights with respect to the Credit Security in
accordance with the Credit Documents, or (d) this Agreement, any other Credit
Document or any transaction contemplated hereby or thereby; PROVIDED, HOWEVER,
that the foregoing indemnity shall not apply (i) to litigation commenced by the
Company against the Lenders or the Agent or the Syndication Agent which seeks
enforcement of any of the rights of the Company hereunder or under any other
Credit Document and is determined adversely to the Lenders or the Agent or the
Syndication Agent in a final nonappealable judgment or (ii) to the extent such
claims, damages, liabilities and expenses result from the Indemnified Party's
own gross negligence or willful misconduct. THE COMPANY EXPRESSLY ACKNOWLEDGES
THAT IT MAY BE REQUIRED TO INDEMNIFY PERSONS AGAINST THEIR OWN NEGLIGENCE.
9.3. INDEMNITY WITH RESPECT TO LETTERS OF CREDIT. The Company shall
indemnify each Letter of Credit Issuer and its correspondents and hold each of
them harmless from and against any and all claims, losses, liabilities, damages
and reasonable expenses (including reasonable attorneys' fees) arising from or
in connection with any Letter of Credit, including any such claim, loss,
liability, damage or expense arising out of any transfer, sale, delivery,
surrender or endorsement of any invoice, xxxx of lading, warehouse receipt or
other document at any time held by the Agent, such Letter of Credit Issuer or
held for their respective accounts by any of their correspondents, in connection
with any Letter of Credit, except to the extent such claims, losses,
liabilities, damages and expenses result from gross negligence or willful
misconduct on the part of the Agent or any other Letter of Credit Issuer.
10. OPERATIONS; AGENT.
10.1. INTERESTS IN CREDITS. The Percentage Interest of each Lender in the
respective portions of the Loan and Letter of Credit Exposure, and the related
Commitments, shall be computed based on the maximum principal amount for each
Lender as set forth in the Register, as from time to time in effect. The current
Percentage Interests are set forth in Exhibit 10.1, which may be updated by the
Agent from time to time to conform to the Register.
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10.2. AGENT'S AUTHORITY TO ACT, ETC. Each of the Lenders appoints and
authorizes BankBoston to act for the Lenders as the Lenders' Agent in connection
with the transactions contemplated by this Agreement and the other Credit
Documents (other than Hedge Agreements) on the terms set forth herein. All
action in connection with the enforcement of, or the exercise of any remedies
(other than the Lenders' rights of set-off as provided in Section 8.2.4 or in
any Credit Document) in respect of the Credit Obligations and Credit Documents
shall be taken by the Agent.
10.3. COMPANY TO PAY AGENT, ETC. The Company and each Guarantor shall be
fully protected in making all payments in respect of the Credit Obligations
(other than payments under Hedge Agreements) to the Agent, in relying upon
consents, modifications and amendments executed by the Agent purportedly on the
Lenders' behalf, and in dealing with the Agent as herein provided. The Agent may
charge the accounts of the Company, on the dates when the amounts thereof become
due and payable, with the amounts of the principal of and interest on the Loan,
any amounts paid by the Letter of Credit Issuers to third parties under Letters
of Credit or drafts presented thereunder, commitment fees, Letter of Credit fees
and all other fees and amounts owing under any Credit Document (other than Hedge
Agreements).
10.4. LENDER OPERATIONS FOR ADVANCES, LETTERS OF CREDIT, ETC.
10.4.1. ADVANCES. Except as the Lenders otherwise agree for loans made
in accordance with the Cash Management Agreement, on each Closing Date,
each Lender shall advance to the Agent in immediately available funds such
Lender's Percentage Interest in the portion of the Loan advanced on such
Closing Date prior to 12:00 noon (Boston time). If such funds are not
received at such time, but all applicable conditions set forth in Section 5
have been satisfied, each Lender authorizes and requests the Agent to
advance for the Lender's account, pursuant to the terms hereof, the
Lender's respective Percentage Interest in such portion of the Loan and
agrees to reimburse the Agent in immediately available funds for the amount
thereof prior to 2:00 p.m. (Boston time) on the day any portion of the Loan
is advanced hereunder; PROVIDED, HOWEVER, that the Agent is not authorized
to make any such advance for the account of any Lender who has previously
notified the Agent in writing that such Lender will not be performing its
obligations to make further advances hereunder; and PROVIDED, FURTHER, that
the Agent shall be under no obligation to make any such advance. With
respect to loans advanced and repayments received in accordance with the
Cash Management Agreement, the Agent shall make such advances and hold such
repayments for its own account on an interim basis and shall settle such
transactions on a net basis with the other Lenders on each Settlement Date
as provided in Section 2.6.
10.4.2. LETTERS OF CREDIT. Each of the Lenders authorizes and requests
each Letter of Credit Issuer to issue the Letters of Credit provided for in
Section 2.3
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and to grant each Lender a participation in each of such Letters of Credit
in an amount equal to its Percentage Interest in the amount of each such
Letter of Credit. Promptly upon the request of the Letter of Credit Issuer,
each Lender shall reimburse the Letter of Credit Issuer in immediately
available funds for such Lender's Percentage Interest in the amount of all
obligations to third parties incurred by the Letter of Credit Issuer in
respect of each Letter of Credit and each draft accepted under a Letter of
Credit to the extent not reimbursed by the Company by 2:00 p.m. (Boston
time) on the Banking Day when due. The Letter of Credit Issuer will notify
each Lender of the issuance of any Letter of Credit, the amount and date of
payment of any draft drawn or accepted under a Letter of Credit and whether
in connection with the payment of any such draft the amount thereof was
added to the Revolving Loan or was reimbursed by the Company.
10.4.3. AGENT TO ALLOCATE PAYMENTS, ETC. All payments of principal and
interest in respect of the extensions of credit made pursuant to this
Agreement, reimbursement of amounts paid by any Letter of Credit Issuer to
third parties under Letters of Credit or drafts presented thereunder,
commitment fees, Letter of Credit fees and other fees under this Agreement
shall, as a matter of convenience, be made by the Company and the
Guarantors to the Agent in immediately available funds by noon (Boston
time) on any Banking Day. Except as the Lenders otherwise agree for loans
made in accordance with the Cash Management Agreement, the share of each
Lender shall be credited to such Lender by the Agent in immediately
available funds by 2:00 p.m. (Boston time) on such Banking Day in such
manner that the principal amount of the Credit Obligations to be paid shall
be paid proportionately in accordance with the Lenders' respective
Percentage Interests in such Credit Obligations, except as otherwise
provided in this Agreement. Under no circumstances shall any Lender be
required to produce or present its Notes as evidence of its interests in
the Credit Obligations in any action or proceeding relating to the Credit
Obligations.
10.4.4. NONPERFORMING LENDERS. In the event that any Lender fails to
reimburse the Agent pursuant to Sections 10.4.1 or 10.4.2 (or in such
manner as the Lenders otherwise agree for loans made in accordance with the
Cash Management Agreement) for the Percentage Interest of such lender (a
"NONPERFORMING LENDER") in any credit advanced by the Agent pursuant
hereto, overdue amounts (the "DELINQUENT PAYMENT") due from the
Nonperforming Lender to the Agent shall bear interest, payable by the
Nonperforming Lender on demand, at a per annum rate equal to (a) the
Federal Funds Rate for the first three days overdue and (b) the sum of 2%
PLUS the Federal Funds Rate for any longer period. Such interest shall be
payable to the Agent for its own account for the period commencing on the
date of the Delinquent Payment and ending on the date the Nonperforming
Lender reimburses the Agent on account of the Delinquent Payment (to the
extent not paid by any Obligor as provided below) and the accrued interest
thereon (the "DELINQUENCY PERIOD"), whether pursuant to the assignments
referred to below or otherwise. Upon notice by the Agent, the Company
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will pay to the Agent the principal (but not the interest) portion of the
Delinquent Payment; PROVIDED that such Delinquent Payment has been
outstanding for no fewer than three days. During the Delinquency Period, in
order to make reimbursements for the Delinquent Payment and accrued
interest thereon, the Nonperforming Lender shall be deemed to have assigned
to the Agent all interest, commitment fees and other payments made by the
Company under Section 3 that would have thereafter otherwise been payable
under the Credit Documents to the Nonperforming Lender. During any period
in which any Nonperforming Lender is not performing its obligations to
extend credit under Section 2, the Nonperforming Lender shall be deemed to
have assigned to each Lender that is not a Nonperforming Lender (a
"PERFORMING LENDER") all principal and other payments made by the Company
under Section 4 that would have thereafter otherwise been payable under the
Credit Documents to the Nonperforming Lender. The Agent shall credit a
portion of such payments to each Performing Lender in an amount equal to
the Percentage Interest of such Performing Lender in an amount equal to the
Percentage Interest of such Performing Lender divided by one MINUS the
Percentage Interest of the Nonperforming Lender until the respective
portions of the Loan owed to all the Lenders are the same as the Percentage
Interests of the Lenders immediately prior to the failure of the
Nonperforming Lender to perform its obligations under Section 2. The
foregoing provisions shall be in addition to any other remedies the Agent,
the Performing Lenders or the Company may have under law or equity against
the Nonperforming Lender as a result of the Delinquent Payment as a result
of its failure to perform its obligations under Section 2.
10.5. SHARING OF PAYMENTS, ETC. Each Lender agrees that (a) if by
exercising any right of set-off or counterclaim or otherwise, it shall receive
payment of (i) a proportion of the aggregate amount due with respect to its
Percentage Interest in the Loan and Letter of Credit Exposure which is greater
than (ii) the proportion received by any other Lender in respect of the
aggregate amount due with respect to such other Lender's Percentage Interest in
the Loan and Letter of Credit Exposure and (b) if such inequality shall continue
for more than 10 days, the Lender receiving such proportionately greater payment
shall purchase participations in the Percentage Interests in the Loan and Letter
of Credit Exposure held by the other Lenders, and such other adjustments shall
be made from time to time (including rescission of such purchases of
participations in the event the unequal payment originally received is recovered
from such Lender through bankruptcy proceedings or otherwise), as may be
required so that all such payments of principal and interest with respect to the
Loan and Letter of Credit Exposure held by the Lenders shall be shared by the
Lenders pro rata in accordance with their respective Percentage Interests;
PROVIDED, HOWEVER, that this Section 10.5 shall not impair the right of any
Lender to exercise any right of set-off or counterclaim it may have and to apply
the amount subject to such exercise to the payment of Indebtedness of any
Obligor other than such Obligor's Indebtedness with respect to the Loan and
Letter of Credit Exposure. Each Lender that grants a participation in the Credit
Obligations to a Credit Participant shall require as a condition to the granting
of such participation that such Credit Participant agree to share
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payments received in respect of the Credit Obligations as provided in this
Section 10.5. The provisions of this Section 10.5 are for the sole and exclusive
benefit of the Lenders and no failure of any Lender to comply with the terms
hereof shall be available to any Obligor as a defense to the payment of the
Credit Obligations.
10.6. AGENT'S RESIGNATION. The Agent may resign at any time by giving at
least 60 days' prior written notice of its intention to do so to each of the
Lenders and the Company and upon the appointment by the Required Lenders of a
successor Agent reasonably satisfactory to the Company; PROVIDED, HOWEVER, that
Bank of America, N.A. shall have the right of first refusal with respect to such
appointment. If no successor Agent shall have been so appointed and shall have
accepted such appointment within 45 days after the retiring Agent's giving of
such notice of resignation, then the retiring Agent may appoint a successor
Agent which shall be a bank or a trust company organized under the laws of the
United States of America or any state thereof and having a combined capital,
surplus and undivided profit of at least $100,000,000 (so long as no Default
exists) with the consent of the Company, which shall not be unreasonably
withheld; PROVIDED, HOWEVER, that any successor Agent appointed under this
sentence may be removed upon the written request of the Required Lenders, which
request shall also appoint a successor Agent (so long as no Default exists)
reasonably satisfactory to the Company. Upon the appointment of a new Agent
hereunder, the term "Agent" shall for all purposes of this Agreement thereafter
mean such successor. After any retiring Agent's resignation hereunder as Agent,
or the removal hereunder of any successor Agent, the provisions of this
Agreement shall continue to inure to the benefit of such retiring or removed
Agent as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement.
10.7. CONCERNING THE AGENT.
10.7.1. ACTION IN GOOD FAITH, ETC. The Agent and its officers,
directors, employees and agents shall be under no liability to any of the
Lenders or to any future holder of any interest in the Credit Obligations
for any action or failure to act taken or suffered in good faith, and any
action or failure to act in accordance with an opinion of its counsel shall
conclusively be deemed to be in good faith. The Agent shall in all cases be
entitled to rely, and shall be fully protected in relying, on instructions
given to the Agent by the Required Lenders.
10.7.2. NO IMPLIED DUTIES, ETC. The Agent shall have and may exercise
such powers as are specifically delegated to the Agent under this Agreement
or any other Credit Document together with all other powers incidental
thereto. The Agent shall have no implied duties to any Person or any
obligation to take any action under this Agreement or any other Credit
Document except for action specifically provided for in this Agreement or
any other Credit Document to be taken by the Agent.
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10.7.3. VALIDITY, ETC. The Agent shall not be responsible to any
Lender or any future holder of any interest in the Credit Obligations (a)
for the legality, validity, enforceability or effectiveness of this
Agreement or any other Credit Document, (b) for any recitals, reports,
representations, warranties or statements contained in or made in
connection with this Agreement or any other Credit Document, (c) for the
existence or value of any assets included in any security for the Credit
Obligations, (d) for the effectiveness of any Lien purported to be included
in the Credit Security, (e) for the specification or failure to specify any
particular assets to be included in the Credit Security, or (f) unless the
Agent shall have failed to comply with Section 10.7.1, for the perfection
of the security interests in the Credit Security.
10.7.4. COMPLIANCE. The Agent shall not be obligated to ascertain or
inquire as to the performance or observance of any of the terms of this
Agreement or any other Credit Document; and in connection with any
extension of credit under this Agreement or any other Credit Document, the
Agent shall be fully protected in relying on a certificate of the Company
as to the fulfillment by the Company of any conditions to such extension of
credit.
10.7.5. EMPLOYMENT OF AGENTS AND COUNSEL. The Agent may execute any of
its duties as Agent under this Agreement or any other Credit Document by or
through employees, agents and attorneys-in-fact and shall not be
responsible to any of the Lenders, the Company or any other Obligor for the
default or misconduct of any such agents or attorneys-in-fact selected by
the Agent acting in good faith. The Agent shall be entitled to advice of
counsel concerning all matters pertaining to the agency hereby created and
its duties hereunder or under any other Credit Document.
10.7.6. RELIANCE ON DOCUMENTS AND COUNSEL. The Agent shall be entitled
to rely, and shall be fully protected in relying, upon any affidavit,
certificate, cablegram, consent, instrument, letter, notice, order,
document, statement, telecopy, telegram, telex or teletype message or
writing reasonably believed in good faith by the Agent to be genuine and
correct and to have been signed, sent or made by the Person in question,
including any telephonic or oral statement made by such Person, and, with
respect to legal matters, upon an opinion or the advice of counsel selected
by the Agent.
10.7.7. AGENT'S REIMBURSEMENT. Each of the Lenders severally agrees to
reimburse the Agent, pro rata in accordance with such Lender's Percentage
Interest, for any reasonable expenses not reimbursed by the Company or the
Guarantors (without limiting the obligation of the Company or the
Guarantors to make such reimbursement): (a) for which the Agent is entitled
to reimbursement by the Company or the Guarantors under this Agreement or
any other Credit Document, and (b) after the occurrence and during the
continuance of a Default, for any other reasonable expenses incurred by the
Agent on the Lenders' behalf in connection with the enforcement of the
Lenders' rights
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under this Agreement or any other Credit Document; PROVIDED, HOWEVER, that
the Agent shall not be reimbursed for any such expenses arising as a result
of its gross negligence or willful misconduct.
10.8. RIGHTS AS A LENDER. With respect to any credit extended by it
hereunder, BankBoston shall have the same rights, obligations and powers
hereunder as any other Lender and may exercise such rights and powers as though
it were not the Agent, and unless the context otherwise specifies, BankBoston
shall be treated in its individual capacity as though it were not the Agent
hereunder. Without limiting the generality of the foregoing, the Percentage
Interest of BankBoston shall be included in any computations of Percentage
Interests. BankBoston and its Affiliates may accept deposits from, lend money
to, act as trustee for and generally engage in any kind of banking or trust
business with the Company, any of its Subsidiaries or any Affiliate of any of
them and any Person who may do business with or own an equity interest in the
Company, any of its Subsidiaries or any Affiliate of any of them, all as if
BankBoston were not the Agent and without any duty to account therefor to the
other Lenders.
10.9. INDEPENDENT CREDIT DECISION. Each of the Lenders acknowledges that it
has independently and without reliance upon the Agent, based on the financial
statements and other documents referred to in Section 7.2, on the other
representations and warranties contained herein and on such other information
with respect to the Company and its Subsidiaries as such Lender deemed
appropriate, made such Lender's own credit analysis and decision to enter into
this Agreement and to make the extensions of credit provided for hereunder. Each
Lender represents to the Agent that such Lender will continue to make its own
independent credit and other decisions in taking or not taking action under this
Agreement or any other Credit Document. Each Lender expressly acknowledges that
neither the Agent nor any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates has made any representations or warranties to
such Lender, and no act by the Agent taken under this Agreement or any other
Credit Document, including any review of the affairs of the Company and its
Subsidiaries, shall be deemed to constitute any representation or warranty by
the Agent. Except for notices, reports and other documents expressly required to
be furnished to each Lender by the Agent under this Agreement or any other
Credit Document, the Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the business,
operations, property, condition, financial or otherwise, or creditworthiness of
the Company or any Subsidiary which may come into the possession of the Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates.
10.10. INDEMNIFICATION. The Lenders shall severally indemnify the Agent and
its officers, directors, employees, agents, attorneys, accountants, consultants
and controlling Persons (to the extent not reimbursed by the Obligors and
without limiting the obligation of any of the Obligors to do so), pro rata in
accordance with their respective Percentage Interests, from and against any and
all liabilities, obligations, losses, damages, penalties, actions,
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judgments, suits, costs, expenses or disbursements of any kind whatsoever which
may at any time be imposed on, incurred by or asserted against the Agent or such
Persons relating to or arising out of this Agreement, any other Credit Document,
the transactions contemplated hereby or thereby, or any action taken or omitted
by the Agent in connection with any of the foregoing; PROVIDED, HOWEVER, that
the foregoing shall not extend to actions or omissions which are taken by the
Agent with gross negligence or willful misconduct.
11. SUCCESSORS AND ASSIGNS; LENDER ASSIGNMENTS AND PARTICIPATIONS. Any
reference in this Agreement or any other Credit Document to any of the parties
hereto shall be deemed to include the successors and assigns of such party, and
all covenants and agreements by or on behalf of the Company, the other Obligors,
the Agent or the Lenders that are contained in this Agreement or any other
Credit Document shall bind and inure to the benefit of their respective
successors and assigns; PROVIDED, HOWEVER, that (a) the Company and its
Subsidiaries may not assign their rights or obligations under this Agreement or
any other Credit Document except for mergers or liquidations permitted by
Section 6.11, and (b) the Lenders shall be not entitled to assign their
respective Percentage Interests in the credits extended hereunder or their
Commitments except as set forth below in this Section 11.
11.1. ASSIGNMENTS BY LENDERS.
11.1.1. ASSIGNEES AND ASSIGNMENT PROCEDURES. Each Lender may, in
compliance with applicable laws in connection with such assignment, assign
to one or more Eligible Assignees (each, an "ASSIGNEE") all or a portion of
its interests, rights and obligations under this Agreement and the other
Credit Documents, including all or a portion, which must be pro rata
between the Revolving Loan, the Acquisition Loan and the Letter of Credit
Exposure, of its Commitment, the portions of the Loan and Letter of Credit
Exposure at the time owing to it and any Notes held by it, but excluding
its rights and obligations as a Letter of Credit Issuer; PROVIDED, HOWEVER,
that:
(1) the aggregate amount of the Commitment of the assigning
Lender subject to each such assignment to any Assignee other than
another Lender, a Related Fund or an Affiliate of a Lender (determined
as of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Agent) shall be not less than
$5,000,000 and in increments of $1,000,000 (or, if less, the entire
remaining amount of the assigning Lender's Commitment); and
(2) the parties to each such assignment shall execute and
deliver to the Agent an Assignment and Acceptance (the "ASSIGNMENT AND
ACCEPTANCE") substantially in the form of Exhibit 11.1.1, together
with the Note subject to such assignment and, except in the event of a
transfer pursuant to Section 11.3, a processing and recordation fee of
$2,500 payable to the Agent by the assigning
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Lender (or as the assigning Lender and the Assignee may otherwise
agree between themselves).
Upon acceptance and recording pursuant to Section 11.1.4, from and after
the effective date specified in each Assignment and Acceptance (which
effective date shall be at least five Banking Days after the execution
thereof unless waived by the Agent):
(A) the Assignee shall be a party hereto and, to the extent provided
in such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement and
(B) the assigning Lender shall, to the extent provided in such
assignment, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all or
the remaining portion of an 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 the benefits of
Sections 3.2.4, 3.5 and 9, as well as to any fees accrued for its
account hereunder and not yet paid).
11.1.2. TERMS OF ASSIGNMENT AND ACCEPTANCE. By executing and
delivering an Assignment and Acceptance, the assigning Lender and the
Assignee shall be deemed to confirm to and agree with each other and the
other parties hereto as follows:
(1) other than the representation and warranty that it is the legal
and beneficial owner of the interest being assigned thereby free and clear
of any adverse claim, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement
or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, any other Credit Document or any
other instrument or document furnished pursuant hereto;
(2) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Company and its Subsidiaries or the performance or observance by the
Company or any of its Subsidiaries of any of its obligations under this
Agreement, any other Credit Document or any other instrument or document
furnished pursuant hereto;
(3) such Assignee confirms that it has received a copy of this
Agreement, together with copies of the most recent financial statements
delivered pursuant to Section 7.2 or Section 6.4 and such other documents
and information as it has deemed
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appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance;
(4) such Assignee will independently and without reliance upon the
Agent, such assigning Lender or any other Lender, and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under this Agreement;
(5) such Assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under this
Agreement as are delegated to the Agent by the terms hereof, together with
such powers as are reasonably incidental thereto; and
(6) such Assignee agrees that it will perform in accordance with the
terms of this Agreement all the obligations which are required to be
performed by it as a Lender.
11.1.3. REGISTER. The Agent shall maintain at the Boston Office (for
this limited purpose, also as agent for the Company) a register (the
"REGISTER") for the recordation of (a) the names and addresses of the
Lenders and the Assignees which assume rights and obligations pursuant to
an assignment under Section 11.1.1, (b) the Percentage Interest of each
such Lender as set forth in Exhibit 10.1 and (c) the amount of the Loan and
Letter of Credit Exposure owing to each Lender from time to time. The
entries in the Register shall be conclusive, in the absence of manifest
error, and the Company, the Agent and the Lenders may treat each Person
whose name is registered therein for all purposes as a party to this
Agreement. The Register shall be available for inspection by the Company or
any Lender at any reasonable time and from time to time upon reasonable
prior notice.
11.1.4. ACCEPTANCE OF ASSIGNMENT AND ASSUMPTION. Upon its receipt of a
completed Assignment and Acceptance executed by an assigning Lender and an
Assignee (and any necessary consent of the Agent and the Company) together
with the processing and recordation fee referred to in Section 11.1.1 and,
to the extent necessary, the Note being assigned, the Agent shall (a)
accept such Assignment and Acceptance, (b) record the information contained
therein in the Register and (c) give prompt notice thereof to the Company.
Within five Banking Days after receipt of notice, the Company, at its own
expense, shall execute and deliver to the Agent (in exchange for the
surrendered Note if such Note must be surrendered or reissued as a result
of such assignment) a new Note to the order of such Assignee in a principal
amount equal to the applicable Commitment and Loan assumed by it pursuant
to such Assignment and Acceptance. If the assigning Lender has retained a
Commitment and Loan, its Note shall be deemed to be then outstanding in a
principal amount equal to the applicable Commitment and Loan retained by
it.
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11.1.5. FEDERAL RESERVE BANK. Notwithstanding the foregoing provisions
of this Section 11 (without the consent of or notice to the Agent or the
Company), any Lender may at any time pledge all or any portion of such
Lender's rights under this Agreement and the other Credit Documents to a
Federal Reserve Bank or, in the case of any Lender that is a fund, to the
trustee of such fund to support the fund's obligations to such trustee;
PROVIDED, HOWEVER, that no such pledge or assignment shall release such
Lender from such Lender's obligations hereunder or under any other Credit
Document.
11.1.6. FURTHER ASSURANCES. The Company and its Subsidiaries shall
sign such documents and take such other actions from time to time
reasonably requested by an Assignee to enable it to share in the benefits
of the rights created by the Credit Documents.
11.2. CREDIT PARTICIPANTS. Each Lender may, without the consent of the
Company or the Agent, in compliance with applicable laws in connection with such
participation, sell to one or more commercial banks, other financial
institutions or funds in the business of making or purchasing loans similar to
the Credit Obligations (each a "CREDIT PARTICIPANT") participations in all or a
portion of its interests, rights and obligations under this Agreement and the
other Credit Documents (including all or a portion of its Commitment, the Loan
and Letter of Credit Exposure owing to it and the Notes held by it); PROVIDED,
HOWEVER, that:
(1) such Lender's obligations under this Agreement shall remain
unchanged;
(2) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations;
(3) the Credit Participant shall be entitled to the benefit of the
cost protection provisions contained in Sections 3.2.4, 3.5 and 9, but
shall not be entitled to receive any greater payment thereunder than the
selling Lender would have been entitled to receive with respect to the
interest so sold if such interest had not been sold; and
(4) the Company, the Agent and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement and, under any agreements
between such Lender and such Credit Participant, such Lender shall retain
the sole right as one of the Lenders to vote (and to determine how to vote)
with respect to the enforcement of the obligations of the Obligors relating
to the Loan and Letter of Credit Exposure and the approval of any
amendment, modification or waiver of any provision of this Agreement (other
than amendments, modifications, consents or waivers described in clause (b)
of the proviso to Section 15.1, with respect to which the Credit
Participant may determine how to vote).
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Each Obligor agrees, to the fullest extent permitted by applicable law, that any
Credit Participant and any Lender purchasing a participation from another Lender
pursuant to Section 10.5 may exercise all rights of payment (including the right
of set-off), with respect to its participation as fully as if such Credit
Participant or such Lender were the direct creditor of the Obligors and a Lender
hereunder in the amount of such participation; PROVIDED, HOWEVER, that such
Credit Participant may only exercise its rights of payment if the Company has
been notified that such Person is a Credit Participant.
11.3. REPLACEMENT OF LENDER. In the event that any Lender or, to the extent
applicable, any Credit Participant (the "AFFECTED LENDER"):
(1) fails to perform its obligations to fund any portion of the Loan
or to issue any Letter of Credit on any Closing Date when required to do so
by the terms of the Credit Documents, or fails to provide its portion of
any LIBOR Pricing Option pursuant to Section 3.2.1 or on account of a Legal
Requirement as contemplated by Section 3.2.5;
(2) demands payment under the provisions of Section 3.5 in an amount
materially in excess of the amounts with respect thereto demanded by the
other Lenders; or
(3) refuses to consent to a proposed amendment, modification, waiver
or other action requiring consent of the holders of 100% of the Percentage
Interests under Section 15.1 that is consented to by Lenders owning at
least 80% of the Percentage Interests;
then, so long as no Event of Default exists, the Company shall have the right to
seek a replacement lender which is reasonably satisfactory to the Agent (the
"REPLACEMENT LENDER"). The Replacement Lender shall purchase the interests of
the Affected Lender in the Loan, Letters of Credit and its Commitment and shall
assume the obligations of the Affected Lender hereunder and under the other
Credit Documents upon execution by the Replacement Lender of an Assignment and
Acceptance and the tender by it to the Affected Lender of a purchase price
agreed between it and the Affected Lender (or, if they are unable to agree, a
purchase price in the amount of the Affected Lender's Percentage Interest in the
Loan and Letter of Credit Exposure, or appropriate credit support for contingent
amounts included therein, and all other outstanding Credit Obligations then owed
to the Affected Lender). No assignment fee pursuant to Section 11.1.1(ii) shall
be required in connection with such assignment. Such assignment by any Affected
Lender who has performed its obligations hereunder shall be deemed an early
termination of any LIBOR Pricing Option to the extent of such Affected Lender's
portion thereof, and the Company will pay to such Affected Lender any resulting
amounts due under Section 3.2.4. Upon consummation of such assignment, the
Replacement Lender shall become
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party to this Agreement as a signatory hereto and shall have all the rights and
obligations of the Affected Lender under this Agreement and the other Credit
Documents with a Percentage Interest equal to the Percentage Interest of the
Affected Lender, the Affected Lender shall be released from its obligations
hereunder and under the other Credit Documents, and no further consent or action
by any party shall be required. Upon the consummation of such assignment, the
Company, the Agent and the Affected Lender shall make appropriate arrangements
so that a new Note is issued to the Replacement Lender if it has acquired a
portion of the Loan. The Company and the Guarantors shall sign such documents
and take such other actions reasonably requested by the Replacement Lender to
enable it to share in the benefits of the rights created by the Credit
Documents. Until the consummation of an assignment in accordance with the
foregoing provisions of this Section 11.3, the Company shall continue to pay to
the Affected Lender any Credit Obligations as they become due and payable.
12. CONFIDENTIALITY. Each Lender will make no disclosure of confidential
information furnished to it by the Company or any of its Subsidiaries unless
such information shall have become public (unless such information has become
public as a result of a violation of this Section 12), except:
(1) in connection with operations under or the enforcement of this
Agreement or any other Credit Document to Persons who have a reasonable
need to be furnished such confidential information in connection with the
administration or other actions related to this Agreement and who agree, in
a commercially customary manner, to comply with the restrictions contained
in this Section 12 with respect to such information;
(2) pursuant to any statutory or regulatory requirement or any
mandatory court order, subpoena or other legal process;
(3) to any parent or corporate Affiliate of such Lender or to any
Credit Participant, proposed Credit Participant or proposed Assignee in
connection with the administration or other actions related to this
Agreement; PROVIDED, HOWEVER, that any such Person shall agree, in a
commercially customary manner, to comply with the restrictions set forth in
this Section 12 with respect to such information;
(4) to its independent counsel, auditors and other professional
advisors in connection with the administration or other actions related to
this Agreement with instruction to such Person to keep such information
confidential; and
(5) with the prior written consent of the Company, to any other
Person.
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13. FOREIGN LENDERS. If any Lender is not created or organized in, or under the
laws of, the United States of America or any state thereof, such Lender shall
deliver to the Company and the Agent the forms described in one of the following
two clauses:
(a) Two fully completed and duly executed United States Internal
Revenue Service Form 1001 or 4224 or any successor form, as the case may
be, certifying that such Lender is entitled to receive payments of the
Credit Obligations payable to it without deduction or withholding of any
United States federal income taxes; or
(b) A statement, executed by such Lender under penalty of perjury,
certifying that such Lender is not a "bank" within the meaning of section
881(c)(3)(A) of the Code and two fully completed and duly executed United
States Internal Revenue Service Forms W-8 or any successor form, certifying
that such Lender is not a "United States person" within the meaning of
section 7701(a)(30) of the Code.
Each Lender that delivers any form or statement pursuant to this Section 13
further undertakes to renew such forms and statements by delivering to the
Company and the Agent any updated form, successor form or other certification,
as the case may be, on or before the date that any form or statement previously
delivered pursuant to this Section 13 expires or becomes obsolete or after the
occurrence of any event requiring a change in such most recent form or
statement. If at any time the Company and the Agent have not received all forms
and statements (including any renewals thereof) required to be provided by any
Lender pursuant to this Section 13, Section 3.5 shall not apply with respect to
any amount of United States federal income taxes required to be withheld from
payments of the Credit Obligations to such Lender.
14. NOTICES. Except as otherwise specified in this Agreement or any other
Credit Document, any notice required to be given pursuant to this Agreement or
any other Credit Document shall be given in writing. Any notice, consent,
approval, demand or other communication in connection with this Agreement or any
other Credit Document shall be deemed to be given if given in writing (including
telex, telecopy or similar teletransmission) addressed as provided below (or to
the addressee at such other address as the addressee shall have specified by
notice actually received by the addressor), and if either (a) actually delivered
in fully legible form to such address (evidenced in the case of a telex by
receipt of the correct answerback) or (b) in the case of a letter, unless actual
receipt of the notice is required by any Credit Document five days shall have
elapsed after the same shall have been deposited in the United States mails,
with first-class postage prepaid and registered or certified.
If to the Company or any of its Subsidiaries, to it at its address set
forth in Exhibit 7.1 (as supplemented pursuant to Sections 6.4.1 and 6.4.2), to
the attention of the chief financial officer.
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If to any Lender or the Agent, to it at its address set forth on the
signature pages of this Agreement or in the Register, with a copy to the Agent.
15. AMENDMENTS, CONSENTS, WAIVERS, ETC.
15.1. LENDER CONSENTS FOR AMENDMENTS. Except as otherwise set forth herein,
the Agent may (and upon the written request of the Required Lenders the Agent
shall) take or refrain from taking any action under this Agreement or any other
Credit Document, including giving its written consent to any modification of or
amendment to and waiving in writing compliance with any covenant or condition in
this Agreement or any other Credit Document (other than a Hedge Agreement) or
any Default or Event of Default, all of which actions shall be binding upon all
of the Lenders; PROVIDED, HOWEVER, that:
(1) Except as provided below, without the written consent of the
Lenders owning at least a majority of the Percentage Interests
(disregarding the Percentage Interest of any Nonperforming Lender so long
as such Lender is treated equally with the other Lenders with respect to
any actions enumerated below), no written modification of, amendment to,
consent with respect to, waiver of compliance with or waiver of a Default
under, any of the Credit Documents (other than a Hedge Agreement) shall be
made.
(2) Without the written consent of such Lenders as own 100% of the
Percentage Interests (disregarding the Percentage Interest of any
Nonperforming Lender so long as such Lender is treated equally with the
other Lenders with respect to any actions enumerated below):
(1) None of the conditions specified in Section 5 shall be
amended, waived or modified.
(2) No release of all or substantially all of the Credit Security
or release of the Company or any material Guarantor shall be made (in
any event, without the written consent of the Lenders, the Agent may
release particular items of Credit Security or particular Guarantors
in dispositions permitted by Section 6.11, as modified by amendments
thereto approved by the Required Lenders, and may release all Credit
Security pursuant to Section 16.1 upon payment in full of the Credit
Obligations and termination of the Commitments).
(3) No incurrence or existence of any Lien on all or
substantially all of the Credit Security shall be permitted (other
than Liens securing the Credit Obligations).
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(4) No alteration shall be made of the Lenders' rights of set-off
contained in Section 8.2.4.
(5) No amendment to or modification of this Section 15.1 or the
definition of "Required Lenders" shall be made.
(3) Without the written consent of each Lender that is directly
affected thereby, as well as such Lenders as own at least a majority of the
Percentage Interests (disregarding the Percentage Interest of any
Nonperforming Lender so long as such Lender is treated equally with the
other Lenders with respect to any actions enumerated below):
(1) No reduction shall be made in (A) the amount of principal of
the Loan owing to such Lender or reimbursement obligations for
payments made under Letters of Credit payable or participated to such
Lender, (B) the interest rate on the portion of the Loan owing to such
Lender or (C) the Letter of Credit fees or commitment fees owing to
such Lender with respect to the credit facility provided herein (other
than amendments and waivers approved by the Required Lenders that
modify defined terms used in calculating the Applicable Margin or that
waive an increase in the Applicable Rate as a result of an Event of
Default).
(2) No change shall be made in the stated, scheduled time of
payment of any portion of the Loan owing to such Lender or interest
thereon or reimbursement of payments made under Letters of Credit or
fees relating to any of the foregoing payable to such Lender and no
waiver shall be made of any Default under Section 8.1.1 with respect
to such Lender (other than amendments and waivers approved by the
Required Lenders that modify defined terms used in calculating the
Applicable Margin).
(3) No increase shall be made in the amount, or extension of the
term, of the stated Commitments of such Lender beyond that provided
for under Section 2.
(4) Without the written consent of the Agent, no amendment or
modification of any Credit Document shall affect the rights or duties of
the Agent under the Credit Documents.
(5) Without the written consent of a Letter of Credit Issuer, no
amendment or modification of any Credit Document shall affect the rights or
duties of such Letter of Credit Issuer under the Credit Documents.
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15.2. COURSE OF DEALING; NO IMPLIED WAIVERS. No course of dealing between
any Lender or the Agent, on one hand, and the Company or any other Obligor, on
the other hand, shall operate as a waiver of any of the Lenders' or the Agent's
rights under this Agreement or any other Credit Document or with respect to the
Credit Obligations. In particular, no delay or omission on the part of any
Lender or the Agent in exercising any right under this Agreement or any other
Credit Document or with respect to the Credit Obligations shall operate as a
waiver of such right or any other right hereunder or thereunder. A waiver on any
one occasion shall not be construed as a bar to or waiver of any right or remedy
on any future occasion. No waiver, consent or amendment with respect to this
Agreement or any other Credit Document shall be binding unless it is in writing
and signed by the Agent or the Required Lenders.
16. GENERAL PROVISIONS.
16.1. DEFEASANCE. When all Credit Obligations have been paid, performed and
reasonably determined by the Agent to have been indefeasibly discharged in full,
and if at the time no Lender continues to be committed to extend any credit to
the Company hereunder or under any other Credit Document, this Agreement and the
other Credit Documents shall terminate and, at the Company's written request,
accompanied by such certificates and other items as the Agent shall reasonably
deem necessary, the Credit Security shall revert to the Obligors and the right,
title and interest of the Agent and the Lenders therein shall terminate.
Thereupon, on the Obligors' demand and at their cost and expense, the Agent
shall execute proper instruments, acknowledging satisfaction of and discharging
this Agreement and the other Credit Documents, and shall redeliver to the
Obligors any Credit Security then in its possession; PROVIDED, HOWEVER, that
Sections 3.2.4, 3.5 (for 90 days after termination of this Agreement), 9,
10.7.7, 10.10, 12 and 16 shall survive the termination of this Agreement.
16.2. NO STRICT CONSTRUCTION. The parties have participated jointly in the
negotiation and drafting of this Agreement and the other Credit Documents with
counsel sophisticated in financing transactions. In the event an ambiguity or
question of intent or interpretation arises, this Agreement and the other Credit
Documents shall be construed as if drafted jointly by the parties and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Agreement and the other
Credit Documents.
16.3. CERTAIN OBLIGOR ACKNOWLEDGMENTS. Each of the Company and the other
Obligors acknowledges that:
(1) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Credit Documents;
(2) neither the Agent nor any Lender has any fiduciary relationship
with or duty to the Obligors arising out of or in connection with this
Agreement or any other
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Credit Document, and the relationship between the Agent and Lenders, on one
hand, and the Obligors, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and
(3) no joint venture is created hereby or by the other Credit
Documents or otherwise exists by virtue of the transactions contemplated
hereby or thereby among the Obligors and the Lenders.
16.4. VENUE; SERVICE OF PROCESS; CERTAIN WAIVERS. Each of the Company, the
other Obligors, the Agent and the Lenders:
(1) Irrevocably submits to the nonexclusive jurisdiction of the state
courts of The Commonwealth of Massachusetts and to the nonexclusive
jurisdiction of the United States District Court for the District of
Massachusetts for the purpose of any suit, action or other proceeding
arising out of or based upon this Agreement or any other Credit Document or
the subject matter hereof or thereof;
(2) Waives to the extent not prohibited by applicable law that cannot
be waived, and agrees not to assert, by way of motion, as a defense or
otherwise, in any such proceeding brought in any of the above-named courts,
any claim that it is not subject personally to the jurisdiction of such
court, that its property is exempt or immune from attachment or execution,
that such proceeding is brought in an inconvenient forum, that the venue of
such proceeding is improper, or that this Agreement or any other Credit
Document, or the subject matter hereof or thereof, may not be enforced in
or by such court;
(3) Consents to service of process in any such proceeding in any
manner at the time permitted by Chapter 223A of the General Laws of The
Commonwealth of Massachusetts and agrees that service of process by
registered or certified mail, return receipt requested, at its address
specified in or pursuant to Section 14 is reasonably calculated to give
actual notice; and
(4) Waives to the extent not prohibited by applicable law that cannot
be waived any right it may have to claim or recover in any such proceeding
any special, exemplary, punitive or consequential damages.
16.5. WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW
THAT CANNOT BE WAIVED, EACH OF THE COMPANY, THE OTHER OBLIGORS, THE AGENT AND
THE LENDERS WAIVES, AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF,
DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF
ANY ISSUE, CLAIM OR PROCEEDING ARISING OUT OF THIS AGREEMENT OR ANY
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OTHER CREDIT DOCUMENT OR THE SUBJECT MATTER HEREOF OR THEREOF OR ANY CREDIT
OBLIGATION OR IN ANY WAY CONNECTED WITH THE DEALINGS OF THE LENDERS, THE AGENT,
THE COMPANY OR ANY OTHER OBLIGOR IN CONNECTION WITH ANY OF THE ABOVE, IN EACH
CASE WHETHER NOW EXISTING OR HEREAFTER ARISING AND WHETHER IN CONTRACT, TORT OR
OTHERWISE. Each of the Company and the other Obligors acknowledges that it has
been informed by the Agent that the foregoing sentence constitutes a material
inducement upon which each of the Lenders has relied and will rely in entering
into this Agreement and any other Credit Document. Any Lender, the Agent, the
Company or any other Obligor may file an original counterpart or a copy of this
Agreement with any court as written evidence of the consent of the Company, the
other Obligors, the Agent and the Lenders to the waiver of their rights to trial
by jury.
16.6. INTERPRETATION; GOVERNING LAW; ETC. Time is (and shall be) of the
essence in this Agreement and the other Credit Documents. All covenants,
agreements, representations and warranties made in this Agreement or any other
Credit Document or in certificates delivered pursuant hereto or thereto shall be
deemed to have been relied on by each Lender, notwithstanding any investigation
made by any Lender on its behalf, and shall survive the execution and delivery
to the Lenders hereof and thereof. The invalidity or unenforceability of any
provision hereof shall not affect the validity or enforceability of any other
provision hereof, and any invalid or unenforceable provision shall be modified
so as to be enforced to the maximum extent of its validity or enforceability.
The headings in this Agreement are for convenience of reference only and shall
not limit or otherwise affect the meaning hereof. This Agreement and the other
Credit Documents constitute the entire understanding of the parties with respect
to the subject matter hereof and thereof and supersede all prior and
contemporaneous understandings and agreements, whether written or oral. This
Agreement may be executed in any number of counterparts which together shall
constitute one instrument. This Agreement shall be governed by and construed in
accordance with the laws (other than the conflict of laws rules) of The
Commonwealth of Massachusetts.
[THE REST OF THIS PAGE IS INTENTIONALLY BLANK.]
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Each of the undersigned has caused this Agreement to be executed and
delivered by its duly authorized officer as an agreement under seal as of the
date first above written.
NEXTERA ENTERPRISES, INC.
By: ______________________________________
Title:
CE ACQUISITION CORP.
CRITIAS, INC.
ERG ACQUISITION CORP.
LEXECON INC.
NEONEXT LLC
NETNEXT, INC.
NEXTERA BUSINESS PERFORMANCE
SOLUTIONS GROUP, INC.
NEXTERA INTERACTIVE, INC.
THE PLANNING TECHNOLOGIES
GROUP, L.L.C.
PYRAMID IMAGING, INC.
SCANADA, INC.
SIBSON & COMPANY, LLC
SIBSON INTERNATIONAL, LLC
TIMAEUS, INC.
By: ______________________________________
As an authorized officer of each of the
foregoing corporations or limited liability
companies
BANKBOSTON, N.A.
By: ______________________________________
Title:
BANKBOSTON, N.A.
Technology and Communications Division
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
110
Telecopy: (000) 000-0000
Telex: 000000
XXXX XX XXXXXXX , X.X.
By:______________________________________
Title:
BANK OF AMERICA, N.A.
0000 Xxxxxxxxx Xxxxx, 0xx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Telecopy: (000) 000-0000
