Exhibit 10.4
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AMENDED AND RESTATED CREDIT AGREEMENT
dated as of June 14, 2001
among
INTERNATIONAL FIBERCOM, INC.
AND CERTAIN OF ITS SUBSIDIARIES,
as Borrowers,
THE LENDERS,
and
BANK ONE, ARIZONA, NA,
as Administrative Agent
BANC ONE CAPITAL MARKETS, INC.
Arranger and Sole Book Manager
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS...................................................... 1
ARTICLE II THE CREDITS..................................................... 17
2.1 Commitment...................................................... 17
2.2 Required Payments; Termination.................................. 18
2.3 Ratable Loans; Types of Advances................................ 18
2.4 Swing Line Loans................................................ 18
2.4.1. Amount of Swing Line Loans............................. 18
2.4.2. Borrowing Notice....................................... 19
2.4.3. Making of Swing Line Loans............................. 19
2.4.4. Repayment of Swing Line Loans.......................... 19
2.5 Commitment Fee; Reductions in Aggregate Commitment.............. 20
2.6 Minimum Amount of Each Advance.................................. 20
2.7 Prepayments..................................................... 20
2.7.1. Optional Principal Payments............................ 20
2.7.2. Mandatory Prepayments.................................. 21
2.8 Method of Selecting Types and Interest Periods for New Advances. 21
2.9 Conversion and Continuation of Outstanding Advances............. 22
2.10 Changes in Interest Rate, etc................................... 22
2.11 Rates Applicable After Default.................................. 23
2.12 Method of Payment............................................... 23
2.13 Noteless Agreement; Evidence of Indebtedness.................... 23
2.14 Telephonic Notices.............................................. 24
2.15 Interest Payment Dates; Interest and Fee Basis.................. 24
2.16 Notification of Advances, Interest Rates, Prepayments and
Commitment Reductions ........................................ 25
2.17 Lending Installations........................................... 25
2.18 Non-Receipt of Funds by the Agent............................... 25
2.19 Facility LCs.................................................... 25
2.19.1. Issuance............................................... 25
2.19.2. Participations......................................... 26
2.19.3. Notice................................................. 26
2.19.4. LC Fees................................................ 26
2.19.5. Administration; Reimbursement by Lenders............... 27
2.19.6. Reimbursement by Borrowers............................. 27
2.19.7. Obligations Absolute................................... 28
2.19.8. Actions of LC Issuer................................... 28
2.19.9. Indemnification........................................ 28
2.19.10. Lenders' Indemnification............................... 29
2.19.11. Facility LC Collateral Account......................... 29
2.19.12. Rights as a Lender..................................... 30
2.20 Replacement of Lender........................................... 30
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ARTICLE III YIELD PROTECTION; TAXES........................................ 30
3.1 Yield Protection................................................ 30
3.2 Changes in Capital Adequacy Regulations......................... 31
3.3 Availability of Types of Advances............................... 32
3.4 Funding Indemnification......................................... 32
3.5 Taxes........................................................... 32
3.6 Lender Statements; Survival of Indemnity........................ 34
ARTICLE IV CONDITIONS PRECEDENT............................................ 34
4.1 Effectiveness................................................... 34
4.2 Each Credit Extension........................................... 34
ARTICLE V REPRESENTATIONS AND WARRANTIES................................... 35
5.1 Existence and Standing.......................................... 35
5.2 Authorization and Validity...................................... 35
5.3 No Conflict; Government Consent................................. 35
5.4 Financial Statements............................................ 36
5.5 Material Adverse Change......................................... 36
5.6 Taxes........................................................... 36
5.7 Litigation and Contingent Obligations........................... 36
5.8 Subsidiaries.................................................... 36
5.9 ERISA........................................................... 36
5.10 Accuracy of Information......................................... 37
5.11 Regulation U.................................................... 37
5.12 Material Agreements............................................. 37
5.13 Compliance With Laws............................................ 37
5.14 Ownership of Properties......................................... 37
5.15 Plan Assets; Prohibited Transactions............................ 37
5.16 Environmental Matters........................................... 38
5.17 Investment Company Act.......................................... 38
5.18 Public Utility Holding Company Act.............................. 38
5.19 Subordinated Indebtedness....................................... 38
5.20 Insurance....................................................... 38
ARTICLE VI COVENANTS....................................................... 38
6.1 Financial Reporting............................................. 38
6.2 Use of Proceeds................................................. 41
6.3 Notice of Default............................................... 41
6.4 Conduct of Business............................................. 41
6.5 Taxes........................................................... 41
6.6 Insurance; Insurance and Condemnation Proceeds.................. 41
6.7 Compliance with Laws............................................ 42
6.8 Maintenance of Properties....................................... 42
6.9 Inspection...................................................... 42
6.10 Dividends....................................................... 43
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6.11 Indebtedness.................................................... 43
6.12 Merger.......................................................... 44
6.13 Sale of Assets.................................................. 44
6.14 Investments and Acquisitions.................................... 44
6.15 Liens........................................................... 45
6.16 Capital Expenditures............................................ 45
6.17 Affiliates...................................................... 46
6.18 Subordinated Indebtedness....................................... 46
6.19 Sale and Leaseback Transactions and other Off-Balance Sheet
Liabilities .................................................. 46
6.20 Contingent Obligations.......................................... 46
6.21 Financial Contracts............................................. 46
6.22 Financial Covenants............................................. 46
6.22.1. Interest Coverage Ratio................................ 46
6.22.2. Fixed Charge Coverage Ratio............................ 46
6.22.3. Adjusted Leverage Ratio................................ 47
6.22.4. Minimum Net Worth...................................... 47
6.22.5. Losses................................................. 47
6.22.6. Calculation of Financial Covenants..................... 47
6.23 Subsidiaries.................................................... 48
6.24 Issuance of Stock............................................... 48
6.25 Future Liens on Real Property................................... 48
6.26 Notice of Redemption of Preferred Stock......................... 48
ARTICLE VII DEFAULTS....................................................... 49
ARTICLE VIII ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES................ 51
8.1 Acceleration; Facility LC Collateral Account.................... 51
8.2 Amendments...................................................... 52
8.3 Preservation of Rights.......................................... 53
ARTICLE IX GENERAL PROVISIONS.............................................. 53
9.1 Survival of Representations..................................... 53
9.2 Governmental Regulation......................................... 53
9.3 Headings........................................................ 54
9.4 Entire Agreement................................................ 54
9.5 Several Obligations; Benefits of this Agreement................. 54
9.6 Expenses; Indemnification....................................... 54
9.7 Numbers of Documents............................................ 55
9.8 Accounting...................................................... 55
9.9 Severability of Provisions...................................... 55
9.10 Nonliability of Lenders......................................... 55
9.11 Confidentiality................................................. 56
9.12 Performance of Obligations...................................... 56
9.13 Joint and Several Liability of the Borrowers.................... 57
9.13.1. Joint and Several Obligations.......................... 57
9.13.2. Limitation on Obligations.............................. 57
9.13.3. Obligations Unconditional.............................. 58
9.14 No Novation..................................................... 59
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ARTICLE X THE AGENT........................................................ 59
10.1 Appointment; Nature of Relationship............................. 59
10.2 Powers.......................................................... 59
10.3 General Immunity................................................ 60
10.4 No Responsibility for Loans, Recitals, etc...................... 60
10.5 Action on Instructions of Lenders............................... 60
10.6 Employment of Agents and Counsel................................ 60
10.7 Reliance on Documents; Counsel.................................. 61
10.8 Agent's Reimbursement and Indemnification....................... 61
10.9 Notice of Default............................................... 61
10.10 Rights as a Lender.............................................. 61
10.11 Lender Credit Decision.......................................... 61
10.12 Successor Agent................................................. 62
10.13 Agent's Fee..................................................... 62
10.14 Delegation to Affiliates........................................ 62
10.15 Execution of Collateral Documents............................... 63
10.16 Collateral Releases............................................. 63
10.17 Co-Agents, Syndication Agent, etc............................... 63
ARTICLE XI SETOFF; RATABLE PAYMENTS........................................ 63
11.1 Setoff.......................................................... 63
11.2 Ratable Payments................................................ 63
11.3 Application of Payments......................................... 63
11.4 Relations Among Lenders......................................... 65
ARTICLE XII BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS.............. 65
12.1 Successors and Assigns.......................................... 65
12.2 Participations.................................................. 65
12.2.1. Permitted Participants; Effect......................... 65
12.2.2. Voting Rights.......................................... 66
12.2.3. Benefit of Setoff...................................... 66
12.3 Assignments..................................................... 66
12.3.1. Permitted Assignments.................................. 66
12.3.2. Effect; Effective Date................................. 67
12.4 Dissemination of Information.................................... 67
12.5 Tax Treatment................................................... 67
ARTICLE XIII NOTICES....................................................... 67
13.1 Notices......................................................... 67
13.2 Change of Address............................................... 68
ARTICLE XIV COUNTERPARTS................................................... 68
ARTICLE XV CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL.... 68
15.1 CHOICE OF LAW................................................... 68
15.2 CONSENT TO JURISDICTION......................................... 68
15.3 WAIVER OF JURY TRIAL............................................ 69
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EXHIBITS
Exhibit A - Form of Joinder Agreement
Exhibit B - Form of Compliance Certificate
Exhibit C - Form of Assignment Agreement
Exhibit D-1 - Form of Promissory Note
Exhibit D-2 - Form of Swing Line Note
Exhibit E - Form of Borrowing Base Certificate
Exhibit F - Form of Work-in-Progress Report
Exhibit G - Form of Backlog Report
Exhibit H - Form of Monthly Cash Summary
Exhibit I - Form of Accounts Receivable Aging Report
SCHEDULES
Pricing Schedule
Commitment Schedule
Schedule 4.1 - List of Closing Documents
Schedule 5.5 - Material Adverse Change
Schedule 5.7 - Litigation
Schedule 5.8 - Subsidiaries
Schedule 5.20 - Existing Insurance Policies
Schedule 6.11 - Permitted Existing Indebtedness
Schedule 6.14 - Permitted Existing Investments
Schedule 6.15 - Permitted Existing Liens
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AMENDED AND RESTATED CREDIT AGREEMENT
This Agreement, dated as of June 14, 2001 is among INTERNATIONAL FIBERCOM,
INC., certain Subsidiaries of the Company, the Lenders, and Bank One, Arizona,
NA, as LC Issuer and as Administrative Agent. The parties hereto agree as
follows:
The Borrowers and the Lenders desire to amend and restate the Original
Agreement in its entirety. Accordingly, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement:
"Accounts Receivable Aging Report" means a written report substantially in
the form of Exhibit I attached hereto.
"Acquisition" means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which the Company or any
of its Subsidiaries (i) acquires any going business or all or substantially all
of the assets of any firm, corporation or limited liability company, or division
thereof, whether through purchase of assets, merger or otherwise or (ii)
directly or indirectly acquires (in one transaction or as the most recent
transaction in a series of transactions) at least a majority (in number of
votes) of the securities of a corporation which have ordinary voting power for
the election of directors (other than securities having such power only by
reason of the happening of a contingency) or a majority (by percentage or voting
power) of the outstanding ownership interests of a partnership or limited
liability company.
"Adjusted EBITDA" means Consolidated EBITDA plus, to the extent deducted
from revenues to determine Consolidated EBITDA, (i) the loss incurred by the
Wireless Technology Group after March 31, 2001 and prior to Xxxxx 0, 0000, (xx)
the write-off of the Equipment Distribution Group, (iii) pooling costs incurred
by the Company related to acquisitions and (iv) any charges incurred in
connection with the issuance by the Company of warrants for its common stock in
an Equity Financing.
"Adjusted Leverage Ratio" means, as of any date of calculation, the ratio
of (i) Consolidated Funded Indebtedness outstanding on such date to (ii)
Adjusted EBITDA for the then most recently ended four fiscal quarters.
"Advance" means a borrowing hereunder, (i) made by some or all of the
Lenders on the same Borrowing Date, or (ii) converted or continued by the
Lenders on the same date of conversion or continuation, consisting, in either
case, of the aggregate amount of the several Loans of the same Type and, in the
case of Eurodollar Loans, for the same Interest Period. The term "Advance" shall
include Swing Line Loans unless otherwise expressly provided.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.
"Agent" means Bank One in its capacity as contractual representative of the
Lenders pursuant to Article X, and not in its individual capacity as a Lender,
and any successor Agent appointed pursuant to Article X.
"Aggregate Commitment" means the aggregate of the Commitments of all the
Lenders, as reduced or increased from time to time pursuant to the terms hereof.
The Aggregate Commitment as of the Effective Date is $100,000,000.
"Aggregate Outstanding Credit Exposure" means, at any time, the aggregate
of the Outstanding Credit Exposure of all the Lenders.
"Agreement" means this credit agreement, as it may be amended or modified
and in effect from time to time.
"Agreement Accounting Principles" means generally accepted accounting
principles as in effect from time to time, applied in a manner consistent with
that used in preparing the financial statements referred to in Section 5.4.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Prime Rate for such day and (ii) the sum of the
Federal Funds Effective Rate for such day plus 1/2% per annum.
"Applicable Fee Rate" means, at any time, the percentage rate per annum at
which commitment fees are accruing on the unused portion of the Aggregate
Commitment at such time, or the percentage rate per annum at which LC Fees are
accruing on the undrawn amount of Facility LCs at such time, as applicable, in
each case as set forth in the Pricing Schedule.
"Applicable Margin" means, with respect to Advances of any Type at any
time, the percentage rate per annum which is applicable at such time with
respect to Advances of such Type as set forth in the Pricing Schedule.
"Appraised Value of Mortgaged Real Property" means the appraised value of
the Mortgaged Real Property as determined by appraisals in form and substance
satisfactory to the Agent obtained by the Agent at the Borrowers' expense. As of
the Effective Date, the appraised value of the Mortgaged Real Property in
Maricopa County, Arizona is $3,300,000, and the appraised value of the Mortgaged
Real Property in Bergen County, New Jersey is $3,500,000.
"Approved Lines of Business" means design, installation, maintenance, and
training services for broadband fiber optic networks for the telecommunications
and cable television industries, and the distribution and selling of
telecommunications equipment.
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"Arranger" means Banc One Capital Markets, Inc., a Delaware corporation,
and its successors, in its capacity as Arranger and Sole Book Manager.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Asset Sale" means, with respect to any Person, the sale, lease,
conveyance, disposition or other transfer by such Person of any of its Property
(including a sale-leaseback transaction and the sale or other transfer of any of
the Equity Interests of any Subsidiary of such Person).
"Authorized Officer" means either of the principal financial officer or
corporate controller of the Company, acting singly.
"Available Aggregate Commitment" means, at any time, the Aggregate
Commitment then in effect minus the Aggregate Outstanding Credit Exposure at
such time.
"Available Credit Amount" means, at any time, the Maximum Credit Amount
then in effect minus the Aggregate Outstanding Credit Exposure at such time.
"Backlog Report" means a report substantially in the form of Exhibit G
attached hereto.
"Bank One" means Bank One, Arizona, NA, a national banking association
having its principal office in Phoenix, Arizona, in its individual capacity, and
its successors.
"Blocked Cash" means, at any time, the amount of funds deposited in a
non-interest bearing deposit account maintained by any Borrower with Bank One
(or an Affiliate of Bank One) in which the Agent, for the benefit of the Holders
of Secured Obligations, has a perfected security interest pursuant to a account
control agreement among such Borrower, Bank One (or such Affiliate) and the
Agent, in form and substance satisfactory to the Agent.
"Borrower" means each of the Company and each Subsidiary of the Company
that is a party hereto, whether as of the Effective Date or by execution and
delivery of a Joinder Agreement thereafter, and in each case such Borrower's
successors and assigns. "Borrowers" means all of the Borrowers.
"Borrowing Base" means, as of any date of calculation, an amount, as set
forth on the most current Borrowing Base Certificate delivered to the Agent,
equal to the sum of (i) eighty-five (85%) of Eligible Receivables, PLUS (ii)
fifty percent (50%) of Eligible Inventory, PLUS (iii) the product of (x) the
Costs in Excess of Xxxxxxxx Advance Rate and (y) Eligible Costs in Excess of
Xxxxxxxx, PLUS (iv) eighty percent (80%) of the Appraised Value of Mortgaged
Real Property.
"Borrowing Base Certificate" means a certificate, in substantially the form
of EXHIBIT E attached hereto and made a part hereof, setting forth the Borrowing
Base and the component calculations thereof.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Borrowing Notice" is defined in Section 2.8.
3
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Phoenix, Arizona for the conduct of
substantially all of their commercial lending activities, interbank wire
transfers can be made on the Fedwire system and dealings in United States
dollars are carried on in the London interbank market and (ii) for all other
purposes, a day (other than a Saturday or Sunday) on which banks generally are
open in Phoenix, Arizona for the conduct of substantially all of their
commercial lending activities and interbank wire transfers can be made on the
Fedwire system.
"Capital Expenditures" means, without duplication, any expenditures for any
purchase or other acquisition of any asset which would be classified as a fixed
or capital asset on a consolidated balance sheet of the Company and its
Subsidiaries prepared in accordance with Agreement Accounting Principles, but
excluding Permitted Acquisitions.
"Capitalized Lease" of a Person means any lease of Property by such Person
as lessee which would be capitalized on a balance sheet of such Person prepared
in accordance with Agreement Accounting Principles.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with
Agreement Accounting Principles.
"Cash Equivalent Investments" means (i) short-term obligations of, or fully
guaranteed by, the United States of America, (ii) commercial paper rated A-1 or
better by S&P or P-1 or better by Xxxxx'x at the time of investment therein,
(iii) demand deposit accounts maintained in the ordinary course of business, and
(iv) certificates of deposit issued by and time deposits with commercial banks
(whether domestic or foreign) having capital and surplus in excess of
$100,000,000; PROVIDED in each case that the same provides for payment of both
principal and interest (and not principal alone or interest alone) and is not
subject to any contingency, other than the demand for payment, regarding the
payment of principal or interest.
"Change in Control" means the acquisition by any Person, or two or more
Persons acting in concert, of beneficial ownership (i) (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934) of 20% or more of the outstanding shares of voting stock
of the Company or (ii) the majority of the board of directors of the Company
fails to consist of Continuing Directors.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Collateral" means all property and interests in property now owned or
hereafter acquired by the Company or any of its Subsidiaries in or upon which a
security interest, lien or mortgage is granted to the Agent, for the benefit of
the Holders of Secured Obligations, or to the Agent, for the benefit of the
Lenders and the LC Issuer, whether under any Collateral Document or under any of
the other Loan Documents.
"Collateral Documents" means, collectively, all agreements, instruments and
documents executed in connection with this Agreement that are intended to create
or evidence Liens to secure the Secured Obligations, including, without
4
limitation, all security agreements, pledge agreements, mortgages, deeds of
trust, powers, assignments and financing statements, whether heretofore, now, or
hereafter executed by or on behalf of the Company or any of its Subsidiaries and
delivered to the Agent or any of the Lenders, together with all agreements and
documents referred to therein or contemplated thereby.
"Collateral Shortfall Amount" is defined in Section 8.1.
"Company" means International FiberCom, Inc., an Arizona corporation, and
its successors and assigns.
"Commitment" means, for each Lender, the obligation of such Lender to make
Revolving Loans to, and participate in Facility LCs issued upon the application
of, the Borrowers in an aggregate amount not exceeding the amount set forth in
the Commitment Schedule or as set forth in any Notice of Assignment relating to
any assignment that has become effective pursuant to Section 12.3.2 or in any
supplement hereto pursuant to Section 2.1(b), as such amount may be modified
from time to time pursuant to the terms hereof.
"Commitment Schedule" means the schedule attached hereto and identified as
such.
"Consolidated EBIT" means Consolidated Net Income plus, to the extent
deducted from revenues in determining Consolidated Net Income, (i) Consolidated
Interest Expense, (ii) expense for taxes paid or accrued and (iii) extraordinary
losses incurred other than in the ordinary course of business, minus, to the
extent included in Consolidated Net Income, extraordinary gains realized other
than in the ordinary course of business, all calculated for the Company and its
Subsidiaries on a consolidated basis.
"Consolidated EBITDA" means Consolidated Net Income plus, to the extent
deducted from revenues in determining Consolidated Net Income, (i) Consolidated
Interest Expense, (ii) expense for taxes paid or accrued, (iii) depreciation,
(iv) amortization and (v) extraordinary losses incurred other than in the
ordinary course of business, minus, to the extent included in Consolidated Net
Income, extraordinary gains realized other than in the ordinary course of
business, all calculated for the Company and its Subsidiaries on a consolidated
basis.
"Consolidated Funded Indebtedness" means at any time the aggregate dollar
amount of Consolidated Indebtedness which has actually been funded and is
outstanding at such time, whether or not such amount is due or payable at such
time.
"Consolidated Indebtedness" means at any time the Indebtedness of the
Company and its Subsidiaries calculated on a consolidated basis as of such time.
"Consolidated Interest Expense" means, with reference to any period, the
interest expense of the Company and its Subsidiaries calculated on a
consolidated basis for such period.
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) of the Company and its Subsidiaries calculated on a
consolidated basis for such period.
5
"Consolidated Net Worth" means at any time the consolidated stockholders'
equity of the Company and its Subsidiaries calculated on a consolidated basis as
of such time.
"Consolidated Rentals" means, with reference to any period, the Rentals of
the Company and its Subsidiaries calculated on a consolidated basis for such
period.
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take-or-pay contract or the obligations of any such Person as general
partner of a partnership with respect to the liabilities of the partnership.
"Continuing Director" means, as of any date of determination, any member of
the board of directors of the Company who (a) was a member of such board of
directors on the date hereof, or (b) was nominated for election or elected to
such board of directors with the approval of the Continuing Directors who were
members of such board at the time of such nomination or election.
"Conversion/Continuation Notice" is defined in Section 2.9.
"Controlled Group" means all members of a controlled group of corporations
or other business entities and all trades or businesses (whether or not
incorporated) under common control which, together with the Company or any of
its Subsidiaries, are treated as a single employer under Section 414 of the
Code.
"Costs in Excess of Xxxxxxxx Advance Rate" means (i) sixty-five percent
(65%) from the Effective Date through December 31, 2001; (ii) sixty percent
(60%) from January 1, 2002 through March 31, 2002; (iii) fifty-five percent
(55%) from April 1, 2002 through June 30, 2002; (iv) fifty percent (50%) from
July 1, 2002 through September 30, 2002; (v) forty-five percent (45%) from
October 1, 2002 through December 31, 2002; and (vi) forty percent (40%) from and
after January 1, 2003.
"Credit Extension" means the making of an Advance or the issuance of a
Facility LC hereunder.
"Credit Extension Date" means the Borrowing Date for an Advance or the
issuance date for a Facility LC.
"Default" means an event described in Article VII.
"Domestic Subsidiary" means a Subsidiary of the Company that is organized
under the laws of the United States of America, any State thereof or the
District of Columbia.
"Effective Date" is defined in Section 4.1.
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"Eligible Costs in Excess of Xxxxxxxx" means the Company's and its
Subsidiaries' costs and estimated earnings in excess of xxxxxxxx, net of any
xxxxxxxx in excess of costs, determined on a consolidated basis in accordance
with Agreement Accounting Principles.
"Eligible Inventory" means the book value of the Company's and its
Subsidiaries' inventory, net of any related reserves (including, without
limitation, any reserve or write-down of inventory of the Equipment Distribution
Group in anticipation of disposition), determined on a consolidated basis in
accordance with Agreement Accounting Principles.
"Eligible Receivables" means the book value of the Company's and its
Subsidiaries' trade accounts receivable, net of any related reserves (including,
without limitation, any reserve or write-down of accounts receivable of the
Equipment Distribution Group in anticipation of disposition), determined on a
consolidated basis in accordance with Agreement Accounting Principles, but
excluding any accounts receivable with respect to which the account debtor is
the subject of a bankruptcy or similar insolvency proceeding or has made an
assignment for the benefit of creditors or whose assets have been conveyed to a
receiver, trustee or assignee for the benefit of creditors.
"Environmental Laws" means any and all federal, state, local and foreign
statutes, laws, judicial decisions, regulations, ordinances, rules, judgments,
orders, decrees, plans, injunctions, permits, concessions, grants, franchises,
licenses, agreements and other governmental restrictions relating to (i) the
protection of the environment, (ii) the effect of the environment on human
health, (iii) emissions, discharges or releases of pollutants, contaminants,
hazardous substances or wastes into surface water, ground water or land, or (iv)
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, hazardous substances or
wastes or the clean-up or other remediation thereof.
"Equipment Distribution Group" means International FiberCom - EDG, Inc.,
formerly known as Southern Communications Products, Inc. and successor by merger
to Diversitec, Inc. and United Tech, Inc.
"Equity Financing" means one or more financing transactions in which the
Company issues its common stock, or its preferred stock convertible into its
common stock, to one or more investors, and may issue warrants for its common
stock in connection therewith; PROVIDED that the terms of any such preferred
stock shall either (i) contain no requirement for any dividend thereon or
mandatory redemption thereof to be payable in cash or other Property of the
Company (other than its common stock or additional shares of such preferred
stock), except as a consequence of the Company's failure to deliver its common
stock in connection with a conversion of such preferred stock, or (ii) be
approved in writing by the Required Lenders.
"Equity Interests" means corporate stock, regardless of class or
designation, and all warrants, options, purchase rights, conversion or exchange
rights, voting rights, calls or claims of any character with respect thereto.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
7
"Eurodollar Advance" means an Advance which, except as otherwise provided
in Section 2.11, bears interest at the applicable Eurodollar Rate.
"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the applicable British Bankers' Association Interest
Settlement Rate for deposits in U.S. dollars appearing on Reuters Screen FRBD as
of 11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period, and having a maturity equal to such Interest Period, provided
that, (i) if Reuters Screen FRBD is not available to the Agent for any reason,
the applicable Eurodollar Base Rate for the relevant Interest Period shall
instead be the applicable British Bankers' Association Interest Settlement Rate
for deposits in U.S. dollars as reported by any other generally recognized
financial information service as of 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period, and having a maturity equal to
such Interest Period, and (ii) if no such British Bankers' Association Interest
Settlement Rate is available to the Agent, the applicable Eurodollar Base Rate
for the relevant Interest Period shall instead be the rate determined by the
Agent to be the rate at which Bank One or one of its affiliate banks offers to
place deposits in U.S. dollars with first-class banks in the London interbank
market at approximately 11:00 a.m. (London time) two Business Days prior to the
first day of such Interest Period, in the approximate amount of Bank One's
relevant Eurodollar Loan and having a maturity equal to such Interest Period.
"Eurodollar Loan" means a Loan which, except as otherwise provided in
Section 2.11, bears interest at the applicable Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the sum of (i) the quotient of (a) the Eurodollar Base
Rate applicable to such Interest Period, divided by (b) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Interest Period, plus
(ii) the Applicable Margin.
"Excluded Taxes" means, in the case of each Lender or applicable Lending
Installation and the Agent, taxes imposed on its overall net income, and
franchise taxes imposed on it, by (i) the jurisdiction under the laws of which
such Lender or the Agent is incorporated or organized or (ii) the jurisdiction
in which the Agent's or such Lender's principal executive office or such
Lender's applicable Lending Installation is located.
"Exhibit" refers to an exhibit to this Agreement, unless another document
is specifically referenced.
"Facility LC" is defined in Section 2.19.1.
"Facility LC Application" is defined in Section 2.19.3.
"Facility LC Collateral Account" is defined in Section 2.19.11.
"Facility Termination Date" means March 31, 2003.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
8
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10:00 a.m.
(Phoenix, Arizona local time) on such day on such transactions received by the
Agent from three Federal funds brokers of recognized standing selected by the
Agent in its sole discretion.
"Financial Contract" of a Person means (i) any exchange-traded or
over-the-counter futures, forward, swap or option contract or other financial
instrument with similar characteristics or (ii) any Rate Management Transaction.
"Financing" means the issuance or sale by the Company or any of its
Subsidiaries of any Indebtedness or Equity Interests for capital formation
purposes, but excluding the issuance or sale of (i) any Indebtedness permitted
to be incurred pursuant to Section 6.11, other than clause (iv) thereof, (ii)
Equity Interests issued by the Company to any officer, director or employee of
the Company or any of its Subsidiaries pursuant to any incentive compensation
plan or program, (iii) Equity Interests issued by any Subsidiary of the Company
to the Company or any Wholly-Owned Subsidiary of the Company, (iv) Equity
Interests issued by the Company as part of the Purchase Price of a Permitted
Acquisition, and (v) Equity Interests issued by way of stock splits or stock
dividends.
"Fixed Charge Coverage Ratio" means, with reference to any period, the
ratio of (i) Adjusted EBITDA plus Consolidated Rentals to (ii) Consolidated
Interest Expense plus Consolidated Rentals plus consolidated tax expense of the
Company and its Subsidiaries paid in cash during such period plus scheduled
maturities of principal of Consolidated Funded Indebtedness payable during such
period, in each case determined in accordance with Agreement Accounting
Principles for such period.
"Floating Rate" means, for any day, a rate per annum equal to (i) the
Alternate Base Rate for such day plus (ii) the Applicable Margin, in each case
changing when and as the Alternate Base Rate changes.
"Floating Rate Advance" means an Advance which, except as otherwise
provided in Section 2.11, bears interest at the Floating Rate.
"Floating Rate Loan" means a Loan which, except as otherwise provided in
Section 2.11, bears interest at the Floating Rate.
"Foreign Subsidiary" means a Subsidiary of the Company that is not
organized under the laws of the United States of America, any State thereof or
the District of Columbia.
"Holders of Secured Obligations" shall mean the holders of the Secured
Obligations from time to time and shall include their respective successors,
transferees and assigns.
"Indebtedness" of a Person means such Person's (i) obligations for borrowed
money, (ii) obligations representing the deferred purchase price of Property or
services (other than accounts payable arising in the ordinary course of such
Person's business payable on terms customary in the trade), (iii) obligations,
whether or not assumed, secured by Liens or payable out of the proceeds or
production from Property now or hereafter owned or acquired by such Person, (iv)
9
obligations which are evidenced by notes, acceptances, or other instruments, (v)
obligations of such Person to purchase securities or other Property (other than
Equity Interests issued by such Person) arising out of or in connection with the
sale of the same or substantially similar securities or Property, (vi)
Capitalized Lease Obligations, (vii) Contingent Obligations, including, without
limitation, reimbursement obligations with respect to Letters of Credit (whether
drawn or undrawn), and (viii) any other obligation for borrowed money or other
financial accommodation which in accordance with Agreement Accounting Principles
would be shown as a liability on the consolidated balance sheet of such Person.
"Indebtedness" shall not include customary liquidated damages provisions in
agreements relating to the issuance of Equity Interests by the Company.
"Interest Coverage Ratio" means, with reference to any period, the ratio of
(i) Consolidated EBIT to (ii) Consolidated Interest Expense, in each case
determined in accordance with Agreement Accounting Principles for such period.
"Interest Period" means, with respect to a Eurodollar Advance, a period of
one, two, three or six months commencing on a Business Day selected by the
applicable Borrower pursuant to this Agreement. Such Interest Period shall end
on the day which corresponds numerically to such date one, two, three or six
months thereafter, provided, however, that if there is no such numerically
corresponding day in such next, second, third or sixth succeeding month, such
Interest Period shall end on the last Business Day of such next, second, third
or sixth succeeding month. If an Interest Period would otherwise end on a day
which is not a Business Day, such Interest Period shall end on the next
succeeding Business Day, provided, however, that if said next succeeding
Business Day falls in a new calendar month, such Interest Period shall end on
the immediately preceding Business Day.
"Investment" of a Person means any loan, advance (other than commission,
travel and similar advances to officers and employees made in the ordinary
course of business), extension of credit (other than accounts receivable arising
in the ordinary course of business on terms customary in the trade) or
contribution of capital by such Person; stocks, bonds, mutual funds, partnership
interests, notes, debentures or other securities owned by such Person; any
deposit accounts and certificate of deposit owned by such Person; and structured
notes, derivative financial instruments and other similar instruments or
contracts owned by such Person.
"Joinder Agreement" means a Joinder Agreement in the form attached hereto
as Exhibit A executed by each Borrower not a party to this Agreement as of the
date of this Agreement.
"LC Fee" is defined in Section 2.19.4.
"LC Issuer" means Bank One (or any subsidiary or affiliate of Bank One
designated by Bank One) in its capacity as issuer of Facility LCs hereunder.
"LC Obligations" means, at any time, the sum, without duplication, of (i)
the aggregate undrawn stated amount under all Facility LCs outstanding at such
time plus (ii) the aggregate unpaid amount at such time of all Reimbursement
Obligations.
"LC Payment Date" is defined in Section 2.19.5.
10
"Lenders" means the lending institutions listed on the signature pages of
this Agreement or any supplement hereto pursuant to Section 2.1(b) and their
respective successors and assigns. Unless otherwise specified, the term
"Lenders" includes Bank One in its capacity as Swing Line Lender.
"Lending Installation" means, with respect to a Lender or the Agent, the
office, branch, subsidiary or affiliate of such Lender or the Agent listed on
the signature pages hereof or on a Schedule or otherwise selected by such Lender
or the Agent pursuant to Section 2.17.
"Letter of Credit" of a Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon which
such Person is an account party or for which such Person is in any way liable.
"Leverage Ratio" means, as of any date of calculation, the ratio of (i)
Consolidated Funded Indebtedness outstanding on such date to (ii) Consolidated
EBITDA for the Company's then most-recently ended four fiscal quarters.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement).
"Loan" means a Revolving Loan or a Swing Line Loan.
"Loan Documents" means this Agreement, the Facility LC Applications, any
Notes issued pursuant to Section 2.13 and the Collateral Documents.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, condition (financial or otherwise), results of operations,
or prospects of the Company and its Subsidiaries taken as a whole, (ii) the
ability of the Borrowers taken as a whole to perform their respective
obligations under the Loan Documents, or (iii) the validity or enforceability of
any of the Loan Documents or the rights or remedies of the Agent, the LC Issuer
or the Lenders thereunder.
"Material Indebtedness" is defined in Section 7.5.
"Maximum Credit Amount" means, at any time, the lesser of (i) the Aggregate
Commitment and (ii) the Borrowing Base at such time.
"Modify" and "Modification" are defined in Section 2.19.1.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Monthly Cash Summary" means a written summary substantially in the form of
Exhibit H attached hereto.
11
"Mortgaged Real Property" means (a) that real property located in (i)
Maricopa County, Arizona, in which a Lien has been granted to the Agent, for the
benefit of the Holders of Secured Obligations, pursuant to that certain Deed of
Trust, Security Agreement, Financing Statement and Assignment of Rents and
Leases dated as of June 14, 2001 between the Company, as grantor, First American
Title Insurance Company, as trustee, and the Agent, as beneficiary, and (ii)
Bergen County, New Jersey, in which a Lien has been granted to the Agent, for
the benefit of the Holders of Secured Obligations, pursuant to that certain
Mortgage, Security Agreement, Financing Statement and Assignment of Rents and
Leases dated as of June 14, 2001 between IFC Leasing, Inc., as mortgagor, and
the Agent, as mortgagee, and (b) any other real property in which a Lien has
been granted to the Agent, for the benefit of the Holders of Secured
Obligations, pursuant to Section 6.25.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Company or any member
of the Controlled Group is a party to which more than one employer is obligated
to make contributions.
"Net Cash Proceeds" means, with respect to any Asset Sale or Financing by
any Person, (a) cash (freely convertible into U.S. dollars) received by such
Person or any Subsidiary of such Person from such Asset Sale (including cash
received as consideration for the assumption or incurrence of liabilities
incurred in connection with or in anticipation of such Asset Sale) or Financing,
after (i) provision for all income or other taxes measured by or resulting from
such Asset Sale, (ii) payment of all reasonable brokerage commissions and other
fees and expenses related to such Asset Sale or Financing, (iii) all amounts
used to repay Indebtedness secured by a Lien on any asset disposed of in such
Asset Sale or which is or may be required (by the express terms of the
instrument governing such Indebtedness) to be repaid in connection with such
Asset Sale (including payments made to obtain or avoid the need for the consent
of any holder of such Indebtedness) or Financing, and (iv) deduction of
appropriate amounts to be provided by such Person or a Subsidiary of such Person
as a reserve, in accordance with Agreement Accounting Principles, against any
liabilities associated with the assets sold or disposed of in such Asset Sale
and retained by such Person or a Subsidiary of such Person after such Asset
Sale, including, without limitation, pension and other post-employment benefit
liabilities and liabilities related to environmental matters or against any
indemnification obligations associated with the assets sold or disposed of in
such Asset Sale; and (b) cash payments in respect of any Indebtedness, Equity
Interest or other consideration received by such Person or any Subsidiary of
such Person from such Asset Sale upon receipt of such cash payments by such
Person or such Subsidiary.
"Non-U.S. Lender" is defined in Section 3.5(iv).
"Note" means any promissory note issued at the request of a Lender pursuant
to Section 2.13 in the form of Exhibit D-1 or D-2.
"Notice of Assignment" is defined in Section 12.3.2.
"Obligations" means all unpaid principal of and accrued and unpaid interest
on the Loans, all Reimbursement Obligations, all accrued and unpaid fees and all
expenses, reimbursements, indemnities and other obligations of the Borrowers to
the Lenders or to any Lender, the Agent, the LC Issuer or any indemnified party
arising under the Loan Documents.
12
"Off-Balance Sheet Liability" of a Person means (i) any repurchase
obligation or liability of such Person with respect to accounts or notes
receivable sold by such Person, (ii) any liability under any Sale and Leaseback
Transaction which is not a Capitalized Lease, (iii) any liability under any
so-called "synthetic lease" transaction entered into by such Person, or (iv) any
obligation arising with respect to any other transaction which is the functional
equivalent of or takes the place of borrowing but which does not constitute a
liability on the balance sheets of such Person, but excluding from this clause
(iv) Operating Leases.
"Operating Lease" of a Person means any lease of Property (other than a
Capitalized Lease) by such Person as lessee which has an original term
(including any required renewals and any renewals effective at the option of the
lessor) of one year or more.
"Original Agreement" means the Credit Agreement dated as of March 31, 2000,
as amended, among the Borrowers, the Lenders from time to time parties thereto,
Bank One, Arizona, NA, as Administrative Agent, Union Bank of California, N.A.,
as Syndication Agent, and Banc One Capital Markets, Inc., as Arranger and Sole
Book Manager.
"Other Taxes" is defined in Section 3.5(ii).
"Outstanding Credit Exposure" means, as to any Lender at any time, the sum
of (i) the aggregate principal amount of its Revolving Loans outstanding at such
time, plus (ii) an amount equal to its Pro Rata Share of the LC Obligations at
such time, plus (iii) an amount equal to its Pro Rata Share of the aggregate
principal amount of Swing Line Loans outstanding at such time.
"Participants" is defined in Section 12.2.1.
"Payment Date" means the fifth day of each month.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Permitted Acquisition" means any Acquisition made by the Company or any of
its Subsidiaries, provided that (i) as of the date of the consummation of such
Acquisition, no Default or Unmatured Default shall have occurred and be
continuing or would result from such Acquisition, and the representations and
warranties contained in Article V shall be true both before and after giving
effect to such Acquisition except to the extent any such representation or
warranty is stated to relate solely to an earlier date, (ii) such Acquisition is
consummated on a non-hostile basis pursuant to a negotiated acquisition
agreement approved by the board of directors or other applicable governing body
of the seller or entity to be acquired, and no material challenge to such
Acquisition (excluding the exercise of appraisal rights) shall be pending or
threatened by any shareholder or director of the seller or entity to be
acquired, (iii) the business to be acquired in such Acquisition is reasonably
related to one or more of the fields of enterprise in which the Company and its
Subsidiaries are engaged on the date hereof, (iv) as of the date of the
consummation of such Acquisition, all material governmental and third party
approvals required in connection therewith shall have been obtained and (v) the
Purchase Price of such Acquisition shall be paid solely through the issuance of
Equity Interests of the Company.
13
"Person" means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by Title IV
of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which the Borrower or any member of the Controlled Group may have any
liability.
"Pricing Schedule" means the Schedule attached hereto identified as such.
"Prime Rate" means a rate per annum equal to the prime rate of interest
announced from time to time by Bank One or its parent (which is not necessarily
the lowest rate charged to any customer), changing when and as said prime rate
changes.
"Property" of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person.
"Pro Rata Share" means, with respect to a Lender, a portion equal to a
fraction the numerator of which is such Lender's Commitment and the denominator
of which is the Aggregate Commitment.
"Purchase Price" means the total consideration and other amounts payable in
connection with any Acquisition, including, without limitation, any portion of
the consideration payable in cash, the value of any Equity Interests of the
Company or any Subsidiary issued as consideration for such Acquisition, all
Indebtedness, liabilities and contingent obligations incurred or assumed in
connection with such Acquisition and all transaction costs and expenses incurred
in connection with such Acquisition.
"Purchasers" is defined in Section 12.3.1.
"Rate Management Transaction" means any transaction (including an agreement
with respect thereto) now existing or hereafter entered into between any
Borrower and any Lender or affiliate thereof which is a rate swap, basis swap,
forward rate transaction, commodity swap, commodity option, equity or equity
index swap, equity or equity index option, bond option, interest rate option,
foreign exchange transaction, cap transaction, floor transaction, collar
transaction, forward transaction, currency swap transaction, cross-currency rate
swap transaction, currency option or any other similar transaction (including
any option with respect to any of these transactions) or any combination
thereof, whether linked to one or more interest rates, foreign currencies,
commodity prices, equity prices or other financial measures.
"Rate Management Obligations" of a Person means any and all obligations of
such Person, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all Rate
Management Transactions, and (ii) any and all cancellations, buy backs,
reversals, terminations or assignments of any Rate Management Transactions.
14
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto or other
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to member banks of the Federal Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.
"Reimbursement Obligations" means, at any time, the aggregate of all
obligations of the Borrowers then outstanding under Section 2.19 to reimburse
the LC Issuer for amounts paid by the LC Issuer in respect of any one or more
drawings under Facility LCs.
"Rentals" of a Person means the aggregate fixed amounts payable by such
Person under any Operating Lease.
"Reportable Event" means a reportable event as defined in Section 4043 of
ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC has by regulation waived
the requirement of Section 4043(a) of ERISA that it be notified within 30 days
of the occurrence of such event, provided, however, that a failure to meet the
minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of the
notice requirement in accordance with either Section 4043(a) of ERISA or Section
412(d) of the Code.
"Reports" is defined in Section 9.6.
"Required Lenders" means three or more Lenders in the aggregate having at
least 51% of the Aggregate Commitment or, if the Aggregate Commitment has been
terminated, Lenders in the aggregate holding at least 51% of the Aggregate
Outstanding Credit Exposure.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.
"Revolving Loan" means, with respect to a Lender, such Lender's loan made
pursuant to its commitment to lend set forth in Section 2.1 or pursuant to
Section 2.4.4 (or any conversion or continuation thereof).
"S&P" means Standard and Poor's Ratings Services, a division of The McGraw
Hill Companies, Inc.
"Sale and Leaseback Transaction" means any sale or other transfer of
Property by any Person with the intent to lease such Property as lessee.
"Schedule" refers to a specific schedule to this Agreement, unless another
document is specifically referenced.
15
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Secured Obligations" means, collectively, (i) the Obligations and (ii) all
Rate Management Obligations owing to any Lender or any affiliate of any Lender.
"Single Employer Plan" means a Plan maintained by the Company or any member
of the Controlled Group for employees of the Company or any member of the
Controlled Group.
"Subordinated Indebtedness" of a Person means any Indebtedness of such
Person the payment of which is subordinated to payment of the Secured
Obligations and all of the terms (including subordination terms) and conditions
of which are reasonably satisfactory to the Required Lenders, as evidenced in
writing.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, limited liability company, association, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless otherwise expressly provided, all references herein to a "Subsidiary"
shall mean a Subsidiary of the Company.
"Substantial Portion" means, with respect to the Property of the Company
and its Subsidiaries, Property which (i) represents more than 10% of the
consolidated assets of the Company and its Subsidiaries as would be shown in the
consolidated financial statements of the Company and its Subsidiaries as at the
end of the four-fiscal quarter period ending immediately prior to the fiscal
quarter in which such determination is made, or (ii) is responsible for more
than 10% of the consolidated net sales or of the consolidated net income of the
Company and its Subsidiaries as reflected in the financial statements referred
to in clause (i) above.
"Swing Line Borrowing Notice" is defined in Section 2.4.2.
"Swing Line Lender" means Bank One or such other Lender which may succeed
to its rights and obligations as Swing Line Lender pursuant to the terms of this
Agreement.
"Swing Line Loan" means a Loan made available to any Borrower by the Swing
Line Lender pursuant to Section 2.4.
"Taxes" means any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings, and any and all liabilities with respect to
the foregoing, but excluding Excluded Taxes and Other Taxes.
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating Rate
Advance or a Eurodollar Advance.
16
"Unfunded Liabilities" means the amount (if any) by which the present value
of all vested and unvested accrued benefits under all Single Employer Plans
exceeds the fair market value of all such Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plans using PBGC actuarial assumptions for single employer plan terminations.
"Unmatured Default" means an event which but for the lapse of time or the
giving of notice, or both, would constitute a Default.
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of the
outstanding voting securities having ordinary voting power of which shall at the
time be owned or controlled, directly or indirectly, by such Person or one or
more Wholly-Owned Subsidiaries of such Person, or by such Person and one or more
Wholly-Owned Subsidiaries of such Person, or (ii) any partnership, limited
liability company, association, joint venture or similar business organization
100% of the ownership interests having ordinary voting power of which shall at
the time be so owned or controlled.
"Wireless Technology Group" means Aerocom, Inc. a Maryland corporation, and
Anacom Systems Corporation, an Arizona corporation.
"Work-in-Progress Report" means a written report substantially in the form
of Exhibit F attached hereto.
The foregoing definitions shall be equally applicable to both the singular
and plural forms of the defined terms.
ARTICLE II
THE CREDITS
2.1 COMMITMENT. (a) From and including the Effective Date and prior to the
Facility Termination Date, each Lender severally agrees, on the terms and
conditions set forth in this Agreement, to (i) make Loans to the Borrowers and
(ii) participate in Facility LCs issued upon the request of the Borrowers,
PROVIDED that, after giving effect to the making of each such Loan and the
issuance of each such Facility LC, (i) such Lender's Outstanding Credit Exposure
shall not exceed its maximum Commitment and (ii) the Aggregate Outstanding
Credit Exposure shall not exceed the Maximum Credit Amount. Subject to the terms
of this Agreement, the Borrowers may borrow, repay and reborrow at any time
prior to the Facility Termination Date. The Commitments to extend credit
hereunder shall expire on the Facility Termination Date. The LC Issuer will
issue Facility LCs hereunder on the terms and conditions set forth in Section
2.19.
(b) At any time no Default or Unmatured Default has occurred and is
continuing, the Company may, by notice to the Agent, request that, on the terms
and subject to the conditions contained in this Agreement, the Lenders and/or
other financial institutions not then a party to this Agreement that are
satisfactory to the Agent and the Company provide up to an aggregate amount of
$50,000,000 in additional Commitments. Upon receipt of such notice, the Agent
shall use all commercially reasonable efforts to arrange for the Lenders or
other financial institutions to provide such additional Commitments; PROVIDED
that the Agent will first offer each of the Lenders that then has a Commitment a
17
pro rata portion (based upon the Commitments at such time) of any such
additional Commitments. Alternatively, any Lender may commit to provide the full
amount of the requested additional Commitments and then offer portions of such
additional Commitments to the other Lenders or other financial institutions,
subject to the proviso in the immediately preceding sentence. Nothing contained
in this paragraph or otherwise in this Agreement is intended to commit any
Lender or the Agent to provide any portion of any such additional Commitments.
If and to the extent that any Lenders and/or other financial institutions agree,
in their sole discretion, to provide any such additional Commitments, (i) the
Aggregate Commitment shall be increased by the amount of the additional
Commitments agreed to be so provided, (ii) the Pro Rata Shares of the respective
Lenders in respect of the Commitments shall be adjusted accordingly, (iii) at
such time and in such manner as the Borrowers and the Agent shall agree (it
being understood that the Borrowers and the Agent will use all commercially
reasonable efforts to avoid the prepayment or assignment of any Eurodollar
Advance on a day other than the last day of the Interest Period applicable
thereto), the Lenders shall assign and assume outstanding Revolving Loans and
participations in L/C Obligations so as to cause the amount of such Revolving
Loans and participations in L/C Obligations held by each Lender to conform to
the respective percentages of the applicable Commitments of the Lenders and (iv)
the Borrowers shall execute and deliver supplements to this Agreement or any
other Loan Documents and any additional Notes as the Agent may reasonably
request.
2.2 REQUIRED PAYMENTS; TERMINATION. The Aggregate Outstanding Credit
Exposure and all other unpaid Obligations shall be paid in full by the Borrowers
on the Facility Termination Date.
2.3 RATABLE LOANS; TYPES OF ADVANCES. Each Advance hereunder (other than
any Swing Line Loan) shall consist of Revolving Loans made from the several
Lenders ratably in proportion to the ratio that their respective Commitments
bear to the Aggregate Commitment. The Advances may be Floating Rate Advances or
Eurodollar Advances, or a combination thereof, selected by the applicable
Borrower in accordance with Sections 2.8 and 2.9, or Swing Line Loans selected
by the applicable Borrower in accordance with Section 2.4.
2.4 SWING LINE LOANS.
2.4.1. AMOUNT OF SWING LINE LOANS. Upon the satisfaction of the
conditions precedent set forth in Section 4.2 and, if such Swing Line Loan
is to be made on the date of the initial Advance hereunder, the
satisfaction of the conditions precedent set forth in Section 4.1 as well,
from and including the date of this Agreement and prior to the Facility
Termination Date, the Swing Line Lender in its sole discretion, on the
terms and conditions set forth in this Agreement, may make Swing Line Loans
to the Borrowers from time to time in an aggregate principal amount not to
exceed $5,000,000 at any one time outstanding, PROVIDED that the Aggregate
Outstanding Credit Exposure shall not at any time exceed the Maximum Credit
Amount, and PROVIDED FURTHER that at no time shall the sum of (i) the Swing
Line Lender's Pro Rata Share of the Swing Line Loans, PLUS (ii) the
outstanding Revolving Loans made by the Swing Line Lender, PLUS (iii) the
Swing Line Lender's Pro Rata Share of the LC Obligations exceed the Swing
Line Lender's maximum Commitment at such time. Subject to the terms of this
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Agreement, the Borrowers may borrow, repay and reborrow Swing Line Loans at
any time prior to the Facility Termination Date.
2.4.2. BORROWING NOTICE. The applicable Borrower shall deliver to the
Agent and the Swing Line Lender irrevocable notice (a "Swing Line Borrowing
Notice") not later than noon (Phoenix, Arizona local time) on the Borrowing
Date of each Swing Line Loan, specifying (i) the applicable Borrowing Date
(which date shall be a Business Day), and (ii) the aggregate amount of the
requested Swing Line Loan, which shall be an amount not less than $100,000.
The Swing Line Loans shall bear interest at the Floating Rate. The
Borrowers may not request more than four Swing Line Loans during any
calendar month.
2.4.3. MAKING OF SWING LINE LOANS. Promptly after receipt of a Swing
Line Borrowing Notice, the Agent shall notify each Lender by fax, or other
similar form of transmission, of the requested Swing Line Loan. Not later
than 2:00 p.m. (Phoenix, Arizona local time) on the applicable Borrowing
Date, the Swing Line Lender may make available the Swing Line Loan, in
funds immediately available in Phoenix, Arizona, to the Agent at its
address specified pursuant to Article XIII. The Agent will promptly make
the funds so received from the Swing Line Lender available to the
applicable Borrower on the Borrowing Date at the Agent's aforesaid address.
2.4.4. REPAYMENT OF SWING LINE LOANS. Each Swing Line Loan shall be
paid in full by the applicable Borrower on the Facility Termination Date.
In addition, the Swing Line Lender may, at any time in its sole discretion
with respect to any outstanding Swing Line Loan, require each Lender
(including the Swing Line Lender) to make a Revolving Loan in the amount of
such Lender's Pro Rata Share of such Swing Line Loan, for the purpose of
repaying such Swing Line Loan. Not later than noon (Phoenix, Arizona local
time) on the date of any notice received pursuant to this Section 2.4.4,
each Lender shall make available its required Revolving Loan, in funds
immediately available in Phoenix, Arizona to the Agent at its address
specified pursuant to Article XIII. Revolving Loans made pursuant to this
Section 2.4.4 shall initially be Floating Rate Loans and thereafter may be
continued as Floating Rate Loans or converted into Eurodollar Loans in the
manner provided in Section 2.9 and subject to the other conditions and
limitations set forth in this Article II. Unless a Lender shall have
notified the Swing Line Lender, prior to its making any Swing Line Loan,
that any applicable condition precedent set forth in Sections 4.1 or 4.2
had not then been satisfied, such Lender's obligation to make Revolving
Loans pursuant to this Section 2.4.4 to repay Swing Line Loans shall be
unconditional, continuing, irrevocable and absolute and shall not be
affected by any circumstances, including, without limitation, (a) any
set-off, counterclaim, recoupment, defense or other right which such Lender
may have against the Agent, the Swing Line Lender or any other Person, (b)
the occurrence or continuance of a Default or Unmatured Default, (c) any
adverse change in the condition (financial or otherwise) of any Borrower,
or (d) any other circumstances, happening or event whatsoever. In the event
that any Lender fails to make payment to the Agent of any amount due under
this Section 2.4.4, the Agent shall be entitled to receive, retain and
apply against such obligation the principal and interest otherwise payable
to such Lender hereunder until the Agent receives such payment from such
Lender or such obligation is otherwise fully satisfied. In addition to the
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foregoing, if for any reason any Lender fails to make payment to the Agent
of any amount due under this Section 2.4.4, such Lender shall be deemed, at
the option of the Agent, to have unconditionally and irrevocably purchased
from the Swing Line Lender, without recourse or warranty, an undivided
interest and participation in the applicable Swing Line Loan in the amount
of such Revolving Loan, and such interest and participation may be
recovered from such Lender together with interest thereon at the Federal
Funds Effective Rate for each day during the period commencing on the date
of demand and ending on the date such amount is received.
2.5 COMMITMENT FEE; REDUCTIONS IN AGGREGATE COMMITMENT. The Borrowers
jointly and severally agree to pay to the Agent for the account of each Lender
according to its Pro Rata Share a commitment fee at a per annum rate equal to
the Applicable Fee Rate on the average daily Available Aggregate Commitment from
the last Payment Date on which the commitment fee was paid under the Original
Agreement to and including the Facility Termination Date, payable on each
Payment Date hereafter with respect to the fee accrued to but not including the
first day of each month and on the Facility Termination Date, PROVIDED that
Swing Line Loans shall not count as usage of any Lender's Commitment for the
purpose of calculating the commitment fee due hereunder. The Company may
permanently reduce the Aggregate Commitment in whole, or in part ratably among
the Lenders in integral multiples of $5,000,000, upon at least three Business
Days' written notice to the Agent, which notice shall specify the amount of any
such reduction, PROVIDED, HOWEVER, that the amount of the Aggregate Commitment
may not be reduced below the Aggregate Outstanding Credit Exposure. All accrued
commitment fees shall be payable on the effective date of any termination of the
obligations of the Lenders to make Credit Extensions hereunder.
2.6 MINIMUM AMOUNT OF EACH ADVANCE. Each Eurodollar Advance shall be in the
minimum amount of $3,000,000 (and in multiples of $1,000,000 if in excess
thereof), and each Floating Rate Advance shall be in the minimum amount of
$3,000,000 (and in multiples of $1,000,000 if in excess thereof), PROVIDED,
HOWEVER, that any Floating Rate Advance may be in the amount of the Available
Credit Amount.
2.7 PREPAYMENTS.
2.7.1. OPTIONAL PRINCIPAL PAYMENTS. The Borrowers may from time to
time pay, without penalty or premium, all outstanding Floating Rate
Advances, or, in a minimum aggregate amount of $3,000,000 or any integral
multiple of $1,000,000 in excess thereof, any portion of the outstanding
Floating Rate Advances upon one Business Day's prior notice to the Agent.
The Borrowers may at any time pay, without penalty or premium, all
outstanding Swing Line Loans, or, in a minimum amount of $100,000 and
increments of $50,000 in excess thereof, any portion of the outstanding
Swing Line Loans, with notice to the Agent and the Swing Line Lender by
11:00 a.m. (Phoenix, Arizona local time) on the date of repayment. The
Borrowers may from time to time pay, subject to the payment of any funding
indemnification amounts required by Section 3.4 but without penalty or
premium, all outstanding Eurodollar Advances, or, in a minimum aggregate
amount of $3,000,000 or any integral multiple of $1,000,000 in excess
thereof, any portion of the outstanding Eurodollar Advances upon three
Business Days' prior notice to the Agent.
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2.7.2. MANDATORY PREPAYMENTS. (a) In the event of any Financing
consisting of an issuance of Equity Interests occurring within six months
after the Effective Date, upon the receipt by the Company or any Subsidiary
of the Net Cash Proceeds thereof, the Borrowers shall make a mandatory
prepayment of the Loans in an amount equal to 50% of the aggregate Net Cash
Proceeds of all such Financings in excess of $20,000,000. Simultaneously
with each such prepayment, the Aggregate Commitment shall automatically be
permanently reduced, ratably among the Lenders, in an amount equal to the
amount of such prepayment. In the event of any Financing other than a
Financing described in the first sentence of this Section 2.7.2(a), upon
the receipt by the Company or any Subsidiary of the Net Cash Proceeds
thereof, the Borrowers shall make a mandatory prepayment of the Loans in an
amount equal to 100% of such Net Cash Proceeds, if such Financing is an
issuance of Equity Interests, or 50% of such Net Cash Proceeds, if such
Financing is an issuance of Indebtedness. Simultaneously with such
prepayment, the Aggregate Commitment shall automatically be permanently
reduced, ratably among the Lenders, in an amount equal to 100% of such Net
Cash Proceeds, if such Financing is an issuance of Equity Interests, or 50%
of such Net Cash Proceeds, if such Financing is an issuance of
Indebtedness.
(b) In the event of any Asset Sale by the Company or any Domestic
Subsidiary of the Company, other than Asset Sales permitted by Section
6.13(i), (ii), (iii) and (iv), upon receipt by the Company or such Domestic
Subsidiary of the Net Cash Proceeds thereof, the Borrowers shall make a
mandatory prepayment of the Loans in an amount equal to the amount of such
Net Cash Proceeds. Simultaneously with such prepayment, the Aggregate
Commitment shall automatically be permanently reduced, ratably among the
Lenders, in an amount equal to the amount of such mandatory prepayment.
(c) If at any time and for any reason the amount of the Aggregate
Outstanding Credit Exposure exceeds the Maximum Credit Amount, the
Borrowers shall immediately make a mandatory prepayment of the Loans in an
amount equal to such excess.
Nothing in this Section 2.7.2 shall be construed to constitute the Lenders'
consent to any transaction which is otherwise prohibited by the terms of
this Agreement.
2.8 METHOD OF SELECTING TYPES AND INTEREST PERIODS FOR NEW ADVANCES. The
applicable Borrower shall select the Type of Advance and, in the case of each
Eurodollar Advance, the Interest Period applicable thereto from time to time.
The applicable Borrower shall give the Agent irrevocable notice (a "Borrowing
Notice") not later than 9:00 a.m. (Phoenix, Arizona local time) on the Borrowing
Date of each Floating Rate Advance (other than a Swing Line Loan) and three
Business Days before the Borrowing Date for each Eurodollar Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day, of such Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance, the Interest Period applicable
thereto.
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Not later than noon (Phoenix, Arizona local time) on each Borrowing Date, each
Lender shall make available its Loan or Loans in funds immediately available in
Phoenix, Arizona to the Agent at its address specified pursuant to Article XIII.
The Agent will make the funds so received from the Lenders available to the
applicable Borrower at the Agent's aforesaid address.
2.9 CONVERSION AND CONTINUATION OF OUTSTANDING ADVANCES. Floating Rate
Advances (other than Swing Line Loans) shall continue as Floating Rate Advances
unless and until such Floating Rate Advances are converted into Eurodollar
Advances pursuant to this Section 2.9 or are repaid in accordance with Section
2.7. Each Eurodollar Advance shall continue as a Eurodollar Advance until the
end of the then applicable Interest Period therefor, at which time such
Eurodollar Advance shall be automatically converted into a Floating Rate Advance
unless (x) such Eurodollar Advance is or was repaid in accordance with Section
2.7 or (y) the applicable Borrower shall have given the Agent a
Conversion/Continuation Notice (as defined below) requesting that, at the end of
such Interest Period, such Eurodollar Advance continue as a Eurodollar Advance
for the same or another Interest Period. Subject to the terms of Section 2.6,
the applicable Borrower may elect from time to time to convert all or any part
of a Floating Rate Advance (other than a Swing Line Loan) into a Eurodollar
Advance. The applicable Borrower shall give the Agent irrevocable notice (a
"Conversion/Continuation Notice") of each conversion of a Floating Rate Advance
into a Eurodollar Advance or continuation of a Eurodollar Advance not later than
10:00 a.m. (Phoenix, Arizona local time) at least three Business Days prior to
the date of the requested conversion or continuation, specifying:
(i) the requested date, which shall be a Business Day, of such conversion
or continuation,
(ii) the aggregate amount and Type of the Advance which is to be converted
or continued, and
(iii) the amount of such Advance which is to be converted into or continued
as a Eurodollar Advance and the duration of the Interest Period
applicable thereto.
2.10 CHANGES IN INTEREST RATE, ETC. Each Floating Rate Advance (other than
a Swing Line Loan) shall bear interest on the outstanding principal amount
thereof, for each day from and including the date such Advance is made or is
automatically converted from a Eurodollar Advance into a Floating Rate Advance
pursuant to Section 2.9, to but excluding the date it is paid or is converted
into a Eurodollar Advance pursuant to Section 2.9 hereof, at a rate per annum
equal to the Floating Rate for such day. Each Swing Line Loan shall bear
interest on the outstanding principal amount thereof, for each day from and
including the day such Swing Line Loan is made to but excluding the date it is
paid, at a rate per annum equal to the Floating Rate for such day. Changes in
the rate of interest on that portion of any Advance maintained as a Floating
Rate Advance will take effect simultaneously with each change in the Alternate
Base Rate. Each Eurodollar Advance shall bear interest on the outstanding
principal amount thereof from and including the first day of the Interest Period
applicable thereto to (but not including) the last day of such Interest Period
at the interest rate determined by the Agent as applicable to such Eurodollar
Advance based upon the applicable Borrower's selections under Sections 2.8 and
2.9 and otherwise in accordance with the terms hereof. No Interest Period may
end after the Facility Termination Date.
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2.11 RATES APPLICABLE AFTER DEFAULT. Notwithstanding anything to the
contrary contained in Section 2.8 or 2.9, during the continuance of a Default or
Unmatured Default the Required Lenders may, at their option, by notice to the
Borrowers (which notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 8.2 requiring unanimous consent of the
Lenders to changes in interest rates), declare that no Advance may be made as,
converted into or continued as a Eurodollar Advance. During the continuance of a
Default the Required Lenders may, at their option, by notice to the Borrowers
(which notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 8.2 requiring unanimous consent of the
Lenders to changes in interest rates), declare that (i) each Eurodollar Advance
shall bear interest for the remainder of the applicable Interest Period at the
rate otherwise applicable to such Interest Period plus 3% per annum, (ii) each
Floating Rate Advance shall bear interest at a rate per annum equal to the
Floating Rate in effect from time to time plus 3% per annum and (iii) the LC Fee
shall be increased by 3% per annum, provided that, during the continuance of a
Default under Section 7.6 or 7.7, the interest rates set forth in clauses (i)
and (ii) above and the increase in the LC Fee set forth in clause (iii) above
shall be applicable to all Credit Extensions without any election or action on
the part of the Agent or any Lender.
2.12 METHOD OF PAYMENT. All payments of the Obligations hereunder shall be
made, without setoff, deduction, or counterclaim, in immediately available funds
to the Agent at the Agent's address specified pursuant to Article XIII, or at
any other Lending Installation of the Agent specified in writing by the Agent to
the Borrowers, by noon (local time) on the date when due and shall (except with
respect to repayments of Swing Line Loans, in the case of Reimbursement
Obligations for which the LC Issuer has not been fully indemnified by the
Lenders, or as otherwise specifically required hereunder) be applied ratably by
the Agent among the Lenders. Each payment delivered to the Agent for the account
of any Lender shall be delivered promptly by the Agent to such Lender in the
same type of funds that the Agent received at its address specified pursuant to
Article XIII or at any Lending Installation specified in a notice received by
the Agent from such Lender. The Agent is hereby authorized to charge the account
of any Borrower maintained with Bank One for each payment of principal,
interest, Reimbursement Obligations and fees as it becomes due hereunder. Each
reference to the Agent in this Section 2.12 shall also be deemed to refer, and
shall apply equally, to the LC Issuer, in the case of payments required to be
made by the Borrowers to the LC Issuer pursuant to Section 2.19.6.
2.13 NOTELESS AGREEMENT; EVIDENCE OF INDEBTEDNESS.
(i) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness of the Borrowers to such
Lender resulting from each Loan made by such Lender from time to time, including
the amounts of principal and interest payable and paid to such Lender from time
to time hereunder.
(ii) The Agent shall also maintain accounts in which it will record
(a) the amount of each Loan made hereunder, the Type thereof and the Interest
Period with respect thereto, (b) the amount of any principal or interest due and
payable or to become due and payable from the Borrowers to each Lender
hereunder, (c) the original stated amount of each Facility LC and the amount of
LC Obligations outstanding at any time, and (d) the amount of any sum received
by the Agent hereunder from the Borrowers and each Lender's share thereof.
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(iii) The entries maintained in the accounts maintained pursuant to
paragraphs (i) and (ii) above shall be prima facie evidence of the existence and
amounts of the Obligations therein recorded; PROVIDED, HOWEVER, that the failure
of the Agent or any Lender to maintain such accounts or any error therein shall
not in any manner affect the obligation of the Borrowers to repay the
Obligations in accordance with their terms.
(iv) Any Lender may request that its Loans be evidenced by a
promissory note or, in the case of the Swing Line Lender, promissory notes
representing its Revolving Loans and Swing Line Loans, respectively,
substantially in the form of Exhibit D-1 or D-2, as applicable (each a "Note").
In such event, each Borrower shall prepare, execute and deliver to such Lender
such Note or Notes payable to the order of such Lender. Thereafter, the Loans
evidenced by each such Note and interest thereon shall at all times (including
after any assignment pursuant to Section 12.3) be represented by one or more
Notes payable to the order of the payee named therein or any assignee pursuant
to Section 12.3, except to the extent that any such Lender or assignee
subsequently returns any such Note for cancellation and requests that such Loans
once again be evidenced as described in paragraphs (i) and (ii) above.
2.14 TELEPHONIC NOTICES. The Borrowers hereby authorize the Lenders and the
Agent to extend, convert or continue Advances, effect selections of Types of
Advances and to transfer funds based on telephonic notices made by any person or
persons the Agent or any Lender in good faith believes to be acting on behalf of
the Borrowers, it being understood that the foregoing authorization is
specifically intended to allow Borrowing Notices and Conversion/Continuation
Notices to be given telephonically. Each Borrower agrees to deliver promptly to
the Agent a written confirmation, if such confirmation is requested by the Agent
or any Lender, of each telephonic notice signed by an Authorized Officer. If the
written confirmation differs in any material respect from the action taken by
the Agent and the Lenders, the records of the Agent and the Lenders shall govern
absent manifest error.
2.15 INTEREST PAYMENT DATES; INTEREST AND FEE BASIS. Interest accrued on
each Floating Rate Advance to but not including the first day of each month
shall be payable on each Payment Date, commencing with the first such date to
occur after the date hereof, and at maturity, whether due to acceleration or
otherwise. Interest accrued on each Eurodollar Advance to but not including the
first day of each month shall be payable on each Payment Date, commencing with
the first such date to occur after the date hereof, and at maturity, whether by
acceleration or otherwise. Interest, commitment fees, LC Fees and fronting fees
with respect to Facility LCs shall be calculated for actual days elapsed on the
basis of a 360-day year. Interest shall be payable for the day an Advance is
made but not for the day of any payment on the amount paid if payment is
received prior to noon (local time) at the place of payment. If any payment of
principal of or interest on an Advance shall become due on a day which is not a
Business Day, such payment shall be made on the next succeeding Business Day
and, in the case of a principal payment, such extension of time shall be
included in computing interest in connection with such payment.
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2.16 NOTIFICATION OF ADVANCES, INTEREST RATES, PREPAYMENTS AND COMMITMENT
REDUCTIONS. Promptly after receipt thereof, the Agent will notify each Lender of
the contents of each Aggregate Commitment reduction notice, Borrowing Notice,
Swing Line Borrowing Notice, Conversion/Continuation Notice, and repayment
notice received by it hereunder. Promptly after notice from the LC Issuer, the
Agent will notify each Lender of the contents of each request for issuance of a
Facility LC hereunder. The Agent will notify each Lender of the interest rate
applicable to each Eurodollar Advance promptly upon determination of such
interest rate and will give each Lender prompt notice of each change in the
Alternate Base Rate.
2.17 LENDING INSTALLATIONS. Each Lender may book its Loans and its
participation in any LC Obligations and the LC Issuer may book the Facility LCs
at any Lending Installation selected by such Lender or the LC Issuer, as the
case may be, and may change its Lending Installation from time to time. All
terms of this Agreement shall apply to any such Lending Installation and the
Loans, Facility LCs, participations in LC Obligations and any Notes issued
hereunder shall be deemed held by each Lender or the LC Issuer, as the case may
be, for the benefit of any such Lending Installation. Each Lender and the LC
Issuer may, by written notice to the Agent and the Borrowers in accordance with
Article XIII, designate replacement or additional Lending Installations through
which Loans will be made by it or Facility LCs will be issued by it and for
whose account Loan payments or payments with respect to Facility LCs are to be
made.
2.18 NON-RECEIPT OF FUNDS BY THE AGENT. Unless any Borrower or a Lender, as
the case may be, notifies the Agent prior to the date on which it is scheduled
to make payment to the Agent of (i) in the case of a Lender, the proceeds of a
Loan or (ii) in the case of a Borrower, a payment of principal, interest or fees
to the Agent for the account of the Lenders, that it does not intend to make
such payment, the Agent may assume that such payment has been made. The Agent
may, but shall not be obligated to, make the amount of such payment available to
the intended recipient in reliance upon such assumption. If such Lender or such
Borrower, as the case may be, has not in fact made such payment to the Agent,
the recipient of such payment shall, on demand by the Agent, repay to the Agent
the amount so made available together with interest thereon in respect of each
day during the period commencing on the date such amount was so made available
by the Agent until the date the Agent recovers such amount at a rate per annum
equal to (x) in the case of payment by a Lender, the Federal Funds Effective
Rate for such day for the first three days and, thereafter, the interest rate
applicable to the relevant Loan or (y) in the case of payment by such Borrower,
the interest rate applicable to the relevant Loan.
2.19 FACILITY LCS.
2.19.1. ISSUANCE. The LC Issuer hereby agrees, on the terms and
conditions set forth in this Agreement, to issue standby and commercial
letters of credit (each, a "Facility LC") and to renew, extend, increase,
decrease or otherwise modify each Facility LC ("Modify," and each such
action a "Modification"), from time to time from and including the date of
this Agreement and prior to the Facility Termination Date upon the request
of the applicable Borrower; provided that immediately after each such
Facility LC is issued or Modified, (i) the aggregate amount of the
outstanding LC Obligations shall not exceed $10,000,000 and (ii) the
Aggregate Outstanding Credit Exposure shall not exceed the Maximum Credit
Amount. No Facility LC shall have an expiry date later than the earlier of
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(x) the fifth Business Day prior to the Facility Termination Date and (y)
one year after its issuance. Each Facility LC may, upon the request of the
applicable Borrower, include a provision whereby such Facility LC shall be
renewed automatically for additional consecutive periods of 12 months or
less (but not beyond the date that is five Business Days prior to the
Facility Termination Date) unless the LC Issuer notifies the beneficiary
thereof at least 30 days prior to the then-applicable expiry date that such
Facility LC will not be renewed.
2.19.2. PARTICIPATIONS. Upon the issuance or Modification by the LC
Issuer of a Facility LC in accordance with this Section 2.19, the LC Issuer
shall be deemed, without further action by any party hereto, to have
unconditionally and irrevocably sold to each Lender, and each Lender shall
be deemed, without further action by any party hereto, to have
unconditionally and irrevocably purchased from the LC Issuer, a
participation in such Facility LC (and each Modification thereof) and the
related LC Obligations in proportion to its Pro Rata Share.
2.19.3. NOTICE. Subject to Section 2.19.1, the applicable Borrower
shall give the LC Issuer notice prior to 10:00 a.m. (Phoenix, Arizona local
time) at least five Business Days prior to the proposed date of issuance or
Modification of each Facility LC, specifying the beneficiary, the proposed
date of issuance (or Modification) and the expiry date of such Facility LC,
and describing the proposed terms of such Facility LC and the nature of the
transactions proposed to be supported thereby. Upon receipt of such notice,
the LC Issuer shall promptly notify the Agent, and the Agent shall promptly
notify each Lender, of the contents thereof and of the amount of such
Lender's participation in such proposed Facility LC. The issuance or
Modification by the LC Issuer of any Facility LC shall, in addition to the
conditions precedent set forth in Article IV (the satisfaction of which the
LC Issuer shall have no duty to ascertain), be subject to the conditions
precedent that such Facility LC shall be satisfactory to the LC Issuer and
that the applicable Borrower shall have executed and delivered such
application agreement and/or such other instruments and agreements relating
to such Facility LC as the LC Issuer shall have reasonably requested (each,
a "Facility LC Application"). In the event of any conflict between the
terms of this Agreement and the terms of any Facility LC Application, the
terms of this Agreement shall control.
2.19.4. LC FEES. The Borrowers jointly and severally agree to pay to
the Agent, for the account of the Lenders ratably in accordance with their
respective Pro Rata Shares, with respect to each Facility LC, a letter of
credit fee at the Applicable Fee Rate on the average daily undrawn stated
amount under such Facility LC, such fee to be payable in arrears on each
Payment Date with respect to the fee accrued to but not including the first
day of each month and on the Facility Termination Date (the "LC Fee"). The
Borrowers also jointly and severally agree to pay to the LC Issuer for its
own account with respect to each Facility LC, (x) a fronting fee at the
rate of 0.25% per annum on the average daily undrawn stated amount of such
Facility LC, such fee to be payable in arrears on each Payment Date with
respect to the fee accrued to but not including the first day of each month
and on the Facility Termination Date, and (y) documentary and processing
charges in connection with the issuance or Modification of and draws under
such Facility LC in accordance with the LC Issuer's standard schedule for
such charges as in effect from time to time.
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2.19.5. ADMINISTRATION; REIMBURSEMENT BY LENDERS. Upon receipt from
the beneficiary of any Facility LC of any demand for payment under such
Facility LC, the LC Issuer shall notify the Agent and the Agent shall
promptly notify the applicable Borrower and each other Lender as to the
amount to be paid by the LC Issuer as a result of such demand and the
proposed payment date (the "LC Payment Date"). The responsibility of the LC
Issuer to the applicable Borrower and each Lender shall be only to
determine that the documents (including each demand for payment) delivered
under each Facility LC in connection with such presentment shall be in
conformity in all material respects with such Facility LC. The LC Issuer
shall endeavor to exercise the same care in the issuance and administration
of the Facility LCs as it does with respect to letters of credit in which
no participations are granted, it being understood that in the absence of
any gross negligence or willful misconduct by the LC Issuer, each Lender
shall be unconditionally and irrevocably liable without regard to the
occurrence of any Default or any condition precedent whatsoever, to
reimburse the LC Issuer on demand for (i) such Lender's Pro Rata Share of
the amount of each payment made by the LC Issuer under each Facility LC to
the extent such amount is not reimbursed by the Borrowers pursuant to
Section 2.19.6 below, plus (ii) interest on the foregoing amount to be
reimbursed by such Lender, for each day from the date of the LC Issuer's
demand for such reimbursement (or, if such demand is made after 11:00 a.m.
(Phoenix, Arizona local time) on such date, from the next succeeding
Business Day) to the date on which such Lender pays the amount to be
reimbursed by it, at a rate of interest per annum equal to the Federal
Funds Effective Rate for the first three days and, thereafter, at a rate of
interest equal to the rate applicable to Floating Rate Advances.
2.19.6. REIMBURSEMENT BY BORROWERS. The Borrowers, jointly and
severally, shall be irrevocably and unconditionally obligated to reimburse
the LC Issuer on or before the applicable LC Payment Date for any amounts
to be paid by the LC Issuer upon any drawing under any Facility LC, without
presentment, demand, protest or other formalities of any kind; PROVIDED
that neither any Borrower nor any Lender shall hereby be precluded from
asserting any claim for direct (but not consequential) damages suffered by
such Borrower or such Lender to the extent, but only to the extent, caused
by (i) the willful misconduct or gross negligence of the LC Issuer in
determining whether a request presented under any Facility LC issued by it
complied with the terms of such Facility LC or (ii) the LC Issuer's failure
to pay under any Facility LC issued by it after the presentation to it of a
request strictly complying with the terms and conditions of such Facility
LC. All such amounts paid by the LC Issuer and remaining unpaid by the
Borrowers shall bear interest, payable on demand, for each day until paid
at a rate per annum equal to (x) the rate applicable to Floating Rate
Advances for such day if such day falls on or before the applicable LC
Payment Date and (y) the sum of 3% per annum plus the rate applicable to
Floating Rate Advances for such day if such day falls after such LC Payment
Date. The LC Issuer will pay to each Lender ratably in accordance with its
Pro Rata Share all amounts received by it from the Borrowers for
application in payment, in whole or in part, of the Reimbursement
Obligation in respect of any Facility LC issued by the LC Issuer, but only
to the extent such Lender has made payment to the LC Issuer in respect of
such Facility LC pursuant to Section 2.19.5. Subject to the terms and
conditions of this Agreement (including without limitation the submission
of a Borrowing Notice in compliance with Section 2.8 and the satisfaction
of the applicable conditions precedent set forth in Article IV), any
Borrower may request an Advance hereunder for the purpose of satisfying any
Reimbursement Obligation.
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2.19.7. OBLIGATIONS ABSOLUTE. The Borrowers' obligations under this
Section 2.19 shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to
payment which any Borrower may have or have had against the LC Issuer, any
Lender or any beneficiary of a Facility LC. Each Borrower further agrees
with the LC Issuer and the Lenders that the LC Issuer and the Lenders shall
not be responsible for, and such Borrower's Reimbursement Obligation in
respect of any Facility LC shall not be affected by, among other things,
the validity or genuineness of documents or of any endorsements thereon,
even if such documents should in fact prove to be in any or all respects
invalid, fraudulent or forged, or any dispute between or among such
Borrower, any of its Affiliates, the beneficiary of any Facility LC or any
financing institution or other party to whom any Facility LC may be
transferred or any claims or defenses whatsoever of such Borrower or of any
of its Affiliates against the beneficiary of any Facility LC or any such
transferee. The LC Issuer shall not be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message
or advice, however transmitted, in connection with any Facility LC. Each
Borrower agrees that any action taken or omitted by the LC Issuer or any
Lender under or in connection with each Facility LC and the related drafts
and documents, if done without gross negligence or willful misconduct,
shall be binding upon the Borrowers and shall not put the LC Issuer or any
Lender under any liability to any Borrower. Nothing in this Section 2.19.7
is intended to limit the right of any Borrower to make a claim against the
LC Issuer for damages as contemplated by the proviso to the first sentence
of Section 2.19.6.
2.19.8. ACTIONS OF LC ISSUER. The LC Issuer shall be entitled to rely,
and shall be fully protected in relying, upon any Facility LC, draft,
writing, resolution, notice, consent, certificate, affidavit, letter,
cablegram, telegram, telecopy, telex or teletype message, statement, order
or other document believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons, and upon advice and
statements of legal counsel, independent accountants and other experts
selected by the LC Issuer. The LC Issuer shall be fully justified in
failing or refusing to take any action under this Agreement unless it shall
first have received such advice or concurrence of the Required Lenders as
it reasonably deems appropriate or it shall first be indemnified to its
reasonable satisfaction by the Lenders against any and all liability and
expense which may be incurred by it by reason of taking or continuing to
take any such action. Notwithstanding any other provision of this Section
2.19, the LC Issuer shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement in accordance with a request
of the Required Lenders, and such request and any action taken or failure
to act pursuant thereto shall be binding upon the Lenders and any future
holders of a participation in any Facility LC.
2.19.9. INDEMNIFICATION. The Borrowers hereby jointly and severally
agree to indemnify and hold harmless each Lender, the LC Issuer and the
Agent, and their respective directors, officers, agents and employees from
and against any and all claims and damages, losses, liabilities, costs or
28
expenses which such Lender, the LC Issuer or the Agent may incur (or which
may be claimed against such Lender, the LC Issuer or the Agent by any
Person whatsoever) by reason of or in connection with the issuance,
execution and delivery or transfer of or payment or failure to pay under
any Facility LC or any actual or proposed use of any Facility LC,
including, without limitation, any claims, damages, losses, liabilities,
costs or expenses which the LC Issuer may incur by reason of or in
connection with (i) the failure of any other Lender to fulfill or comply
with its obligations to the LC Issuer hereunder (but nothing herein
contained shall affect any rights any Borrower may have against any
defaulting Lender) or (ii) by reason of or on account of the LC Issuer
issuing any Facility LC which specifies that the term "Beneficiary"
included therein includes any successor by operation of law of the named
Beneficiary, but which Facility LC does not require that any drawing by any
such successor Beneficiary be accompanied by a copy of a legal document,
satisfactory to the LC Issuer, evidencing the appointment of such successor
Beneficiary; provided that the Borrowers shall not be required to indemnify
any Lender, the LC Issuer or the Agent for any claims, damages, losses,
liabilities, costs or expenses to the extent, but only to the extent,
caused by (x) the willful misconduct or gross negligence of the LC Issuer
in determining whether a request presented under any Facility LC complied
with the terms of such Facility LC or (y) the LC Issuer's failure to pay
under any Facility LC after the presentation to it of a request strictly
complying with the terms and conditions of such Facility LC. Nothing in
this Section 2.19.9 is intended to limit the obligations of the Borrowers
under any other provision of this Agreement.
2.19.10. LENDERS' INDEMNIFICATION. Each Lender shall, ratably in
accordance with its Pro Rata Share, indemnify the LC Issuer, its affiliates
and their respective directors, officers, agents and employees (to the
extent not reimbursed by the Borrowers) against any cost, expense
(including reasonable counsel fees and disbursements), claim, demand,
action, loss or liability (except such as result from such indemnitees'
gross negligence or willful misconduct or the LC Issuer's failure to pay
under any Facility LC after the presentation to it of a request strictly
complying with the terms and conditions of the Facility LC) that such
indemnitees may suffer or incur in connection with this Section 2.19 or any
action taken or omitted by such indemnitees hereunder.
2.19.11. FACILITY LC COLLATERAL ACCOUNT. Each Borrower agrees that it
will, upon the request of the Agent or the Required Lenders and until the
final expiration date of any Facility LC and thereafter as long as any
amount is payable to the LC Issuer or the Lenders in respect of any
Facility LC, maintain a special collateral account pursuant to arrangements
satisfactory to the Agent (the "Facility LC Collateral Account") at the
Agent's office at the address specified pursuant to Article XIII, in the
name of such Borrower but under the sole dominion and control of the Agent,
for the benefit of the Lenders and in which such Borrower shall have no
interest other than as set forth in Section 8.1. Each Borrower hereby
pledges, assigns and grants to the Agent, on behalf of and for the ratable
benefit of the Lenders and the LC Issuer, a security interest in all of
such Borrower's right, title and interest in and to all funds which may
from time to time be on deposit in the Facility LC Collateral Account to
secure the prompt and complete payment and performance of the Obligations.
29
The Agent will invest any funds on deposit from time to time in the
Facility LC Collateral Account in certificates of deposit of Bank One
having a maturity not exceeding 30 days. Nothing in this Section 2.19.11
shall either obligate the Agent to require any Borrower to deposit any
funds in the Facility LC Collateral Account or limit the right of the Agent
to release any funds held in the Facility LC Collateral Account in each
case other than as required by Section 8.1.
2.19.12. RIGHTS AS A LENDER. In its capacity as a Lender, the LC
Issuer shall have the same rights and obligations as any other Lender.
2.20 REPLACEMENT OF LENDER. If any Borrower is required pursuant to Section
3.1, 3.2 or 3.5 to make any additional payment to any Lender or if any Lender's
obligation to make or continue, or to convert Floating Rate Advances into,
Eurodollar Advances shall be suspended pursuant to Section 3.3 (any Lender so
affected an "Affected Lender"), the Borrowers may elect, if such amounts
continue to be charged or such suspension is still effective, to replace such
Affected Lender as a Lender party to this Agreement, provided that no Default or
Unmatured Default shall have occurred and be continuing at the time of such
replacement, and provided further that, concurrently with such replacement, (i)
another bank or other entity which is reasonably satisfactory to the Company and
the Agent shall agree, as of such date, to purchase for cash the Advances and
other Obligations due to the Affected Lender pursuant to an assignment
substantially in the form of Exhibit C and to become a Lender for all purposes
under this Agreement and to assume all obligations of the Affected Lender to be
terminated as of such date and to comply with the requirements of Section 12.3
applicable to assignments, and (ii) the Borrowers shall pay to such Affected
Lender in same day funds on the day of such replacement (A) all interest, fees
and other amounts then accrued but unpaid to such Affected Lender by the
Borrowers hereunder to and including the date of termination, including without
limitation payments due to such Affected Lender under Sections 3.1, 3.2 and 3.5,
and (B) an amount, if any, equal to the payment which would have been due to
such Lender on the day of such replacement under Section 3.4 had the Loans of
such Affected Lender been prepaid on such date rather than sold to the
replacement Lender.
ARTICLE III
YIELD PROTECTION; TAXES
3.1 YIELD PROTECTION. If, on or after the date of this Agreement, the
adoption of any law or any governmental or quasi-governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law), or any
change in the interpretation or administration thereof by any governmental or
quasi-governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender or
applicable Lending Installation or the LC Issuer with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency:
(i) subjects any Lender or any applicable Lending Installation or the
LC Issuer to any Taxes, or changes the basis of taxation of payments (other
than with respect to Excluded Taxes) to any Lender or the LC Issuer in
respect of its Eurodollar Loans, Facility LCs or participations therein, or
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(ii) imposes or increases or deems applicable any reserve, assessment,
insurance charge, special deposit or similar requirement against assets of,
deposits with or for the account of, or credit extended by, any Lender or
any applicable Lending Installation or the LC Issuer (other than reserves
and assessments taken into account in determining the interest rate
applicable to Eurodollar Advances), or
(iii) imposes any other condition the result of which is to increase
the cost to any Lender or any applicable Lending Installation or the LC
Issuer of making, funding or maintaining its Eurodollar Loans, or of
issuing or participating in Facility LCs, or reduces any amount receivable
by any Lender or any applicable Lending Installation or the LC Issuer in
connection with its Eurodollar Loans, Facility LCs or participations
therein, or requires any Lender or any applicable Lending Installation or
the LC Issuer to make any payment calculated by reference to the amount of
Eurodollar Loans, Facility LCs or participations therein held or interest
or LC Fees received by it, by an amount deemed material by such Lender or
the LC Issuer, as the case may be,
and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation or the LC Issuer, as the case may be, of making
or maintaining its Eurodollar Loans or Commitment or of issuing or participating
in Facility LCs or to reduce the return received by such Lender or applicable
Lending Installation or the LC Issuer, as the case may be, in connection with
such Eurodollar Loans, Commitment, Facility LCs or participations therein, then,
within 15 days of demand by such Lender or the LC Issuer, as the case may be,
the Borrowers jointly and severally agree to pay such Lender or the LC Issuer,
as the case may be, such additional amount or amounts as will compensate such
Lender or the LC Issuer, as the case may be, for such increased cost or
reduction in amount received.
3.2 CHANGES IN CAPITAL ADEQUACY REGULATIONS. If a Lender or the LC Issuer
determines the amount of capital required or expected to be maintained by such
Lender or the LC Issuer, any Lending Installation of such Lender or the LC
Issuer, or any corporation controlling such Lender or the LC Issuer is increased
as a result of a Change, then, within 15 days of demand by such Lender or the LC
Issuer, the Borrowers jointly and severally agree to pay such Lender or the LC
Issuer the amount necessary to compensate for any shortfall in the rate of
return on the portion of such increased capital which such Lender or the LC
Issuer reasonably determines is attributable to this Agreement, its Outstanding
Credit Exposure or its Commitment to make Loans and issue or participate in
Facility LCs, as the case may be, hereunder (after taking into account such
Lender's or the LC Issuer's policies as to capital adequacy). "Change" means (i)
any change after the date of this Agreement in the Risk-Based Capital Guidelines
or (ii) any adoption of or change in any other law, governmental or
quasi-governmental rule, regulation, policy, guideline, interpretation, or
directive (whether or not having the force of law) after the date of this
Agreement which affects the amount of capital required or expected to be
maintained by any Lender or the LC Issuer or any Lending Installation or any
corporation controlling any Lender or the LC Issuer. "Risk-Based Capital
Guidelines" means (i) the risk-based capital guidelines in effect in the United
States on the date of this Agreement, including transition rules, and (ii) the
corresponding capital regulations promulgated by regulatory authorities outside
the United States implementing the July 1988 report of the Basle Committee on
Banking Regulation and Supervisory Practices Entitled "International Convergence
of Capital Measurements and Capital Standards," including transition rules, and
any amendments to such regulations adopted prior to the date of this Agreement.
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3.3 AVAILABILITY OF TYPES OF ADVANCES. If any Lender determines that
maintenance of its Eurodollar Loans at a suitable Lending Installation would
violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or if the Required Lenders determine that (i) deposits
of a type and maturity appropriate to match fund Eurodollar Advances are not
available or (ii) the interest rate applicable to Eurodollar Advances does not
accurately reflect the cost of making or maintaining Eurodollar Advances, then
the Agent shall suspend the availability of Eurodollar Advances and require any
affected Eurodollar Advances to be repaid or converted to Floating Rate
Advances, subject to the payment of any funding indemnification amounts required
by Section 3.4.
3.4 FUNDING INDEMNIFICATION. If any payment of a Eurodollar Advance occurs
on a date which is not the last day of the applicable Interest Period, whether
because of acceleration, prepayment or otherwise, or a Eurodollar Advance is not
made on the date specified by the applicable Borrower for any reason other than
default by the Lenders, the Borrowers jointly and severally agree to indemnify
each Lender for any reasonable loss or cost incurred by it resulting therefrom,
including, without limitation, any loss or cost in liquidating or employing
deposits acquired to fund or maintain such Eurodollar Advance.
3.5 TAXES.
(i) All payments by the Borrowers to or for the account of any Lender,
the LC Issuer or the Agent hereunder or under any Note or Facility LC
Application shall be made free and clear of and without deduction for any
and all Taxes. If any Borrower shall be required by law to deduct any Taxes
from or in respect of any sum payable hereunder to any Lender, the LC
Issuer or the Agent, (a) the sum payable shall be increased as necessary so
that after making all required deductions (including deductions applicable
to additional sums payable under this Section 3.5) such Lender, the LC
Issuer or the Agent (as the case may be) receives an amount equal to the
sum it would have received had no such deductions been made, (b) such
Borrower shall make such deductions, (c) such Borrower shall pay the full
amount deducted to the relevant authority in accordance with applicable law
and (d) such Borrower shall furnish to the Agent the original copy of a
receipt evidencing payment thereof within 30 days after such payment is
made.
(ii) In addition, the Borrowers hereby jointly and severally agree to
pay any present or future stamp or documentary taxes and any other excise
or property taxes, charges or similar levies which arise from any payment
made hereunder or under any Note or Facility LC Application or from the
execution or delivery of, or otherwise with respect to, this Agreement or
any Note or Facility LC Application ("Other Taxes").
(iii) The Borrowers hereby jointly and severally agree to indemnify
the Agent, the LC Issuer and each Lender for the full amount of Taxes or
Other Taxes (including, without limitation, any Taxes or Other Taxes
imposed on amounts payable under this Section 3.5) paid by the Agent, the
LC Issuer or such Lender and any liability (including penalties, interest
and expenses) arising therefrom or with respect thereto. Payments due under
this indemnification shall be made within 30 days of the date the Agent,
the LC Issuer or such Lender makes demand therefor pursuant to Section 3.6.
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(iv) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof (each a "Non-U.S. Lender") agrees that
it will, not less than ten Business Days after the date of this Agreement,
(i) deliver to each of the Company and the Agent two duly completed copies
of United States Internal Revenue Service Form 1001 or 4224, certifying in
either case that such Lender is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal
income taxes, and (ii) deliver to each of the Company and the Agent a
United States Internal Revenue Form W-8 or W-9, as the case may be, and
certify that it is entitled to an exemption from United States backup
withholding tax. Each Non-U.S. Lender further undertakes to deliver to each
of the Company and the Agent (x) renewals or additional copies of such form
(or any successor form) on or before the date that such form expires or
becomes obsolete, and (y) after the occurrence of any event requiring a
change in the most recent forms so delivered by it, such additional forms
or amendments thereto as may be reasonably requested by the Company or the
Agent. All forms or amendments described in the preceding sentence shall
certify that such Lender is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal
income taxes, unless an event (including without limitation any change in
treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms
inapplicable or which would prevent such Lender from duly completing and
delivering any such form or amendment with respect to it and such Lender
advises the Company and the Agent that it is not capable of receiving
payments without any deduction or withholding of United States federal
income tax.
(v) For any period during which a Non-U.S. Lender has failed to
provide the Company with an appropriate form pursuant to clause (iv) above
(unless such failure is due to a change in treaty, law or regulation, or
any change in the interpretation or administration thereof by any
governmental authority, occurring subsequent to the date on which a form
originally was required to be provided), such Non-U.S. Lender shall not be
entitled to indemnification under this Section 3.5 with respect to Taxes
imposed by the United States; provided that, should a Non-U.S. Lender which
is otherwise exempt from or subject to a reduced rate of withholding tax
become subject to Taxes because of its failure to deliver a form required
under clause (iv), above, the Borrowers shall take such steps as such
Non-U.S. Lender shall reasonably request to assist such Non-U.S. Lender to
recover such Taxes.
(vi) Any Lender that is entitled to an exemption from or reduction of
withholding tax with respect to payments under this Agreement or any Note
pursuant to the law of any relevant jurisdiction or any treaty shall
deliver to the Company (with a copy to the Agent), at the time or times
prescribed by applicable law, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to
be made without withholding or at a reduced rate.
(vii) If the U.S. Internal Revenue Service or any other governmental
authority of the United States or any other country or any political
subdivision thereof asserts a claim that the Agent did not properly
withhold tax from amounts paid to or for the account of any Lender (because
the appropriate form was not delivered or properly completed, because such
Lender failed to notify the Agent of a change in circumstances which
33
rendered its exemption from withholding ineffective, or for any other
reason), such Lender shall indemnify the Agent fully for all amounts paid,
directly or indirectly, by the Agent as tax, withholding therefor, or
otherwise, including penalties and interest, and including taxes imposed by
any jurisdiction on amounts payable to the Agent under this subsection,
together with all costs and expenses related thereto (including attorneys
fees and time charges of attorneys for the Agent, which attorneys may be
employees of the Agent). The obligations of the Lenders under this Section
3.5(vii) shall survive the payment of the Obligations and termination of
this Agreement.
3.6 LENDER STATEMENTS; SURVIVAL OF INDEMNITY. To the extent reasonably
possible, each Lender shall designate an alternate Lending Installation with
respect to its Eurodollar Loans to reduce any liability of the Borrowers to such
Lender under Sections 3.1, 3.2 and 3.5 or to avoid the unavailability of
Eurodollar Advances under Section 3.3, so long as such designation is not, in
the judgment of such Lender, disadvantageous to such Lender. Each Lender shall
deliver a written statement of such Lender to the Company (with a copy to the
Agent) as to the amount due, if any, under Section 3.1, 3.2, 3.4 or 3.5. Such
written statement shall set forth in reasonable detail the calculations upon
which such Lender determined such amount and shall be rebuttably presumptive
evidence of the amount due, binding on the Borrowers in the absence of
demonstrable error. Determination of amounts payable under such Sections in
connection with a Eurodollar Loan shall be calculated as though each Lender
funded its Eurodollar Loan through the purchase of a deposit of the type and
maturity corresponding to the deposit used as a reference in determining the
Eurodollar Rate applicable to such Loan, whether in fact that is the case or
not. Unless otherwise provided herein, the amount specified in the written
statement of any Lender shall be payable on demand after receipt by the
applicable Borrower of such written statement. The obligations of the Borrowers
under Sections 3.1, 3.2, 3.4 and 3.5 shall survive payment of the Obligations
and termination of this Agreement.
ARTICLE IV
CONDITIONS PRECEDENT
4.1 EFFECTIVENESS. This Agreement shall become effective as of the date
hereof (the "Effective Date") upon receipt by the Agent of (i) counterparts of
this Agreement duly executed by the Borrowers and the Required Lenders, (ii)
each of the documents listed on the List of Closing Documents attached hereto as
Schedule 4.1, (iii) such other documents as the Agent or any Lender may
reasonably request, (iv) an amendment fee equal to 0.50% of the Aggregate
Commitment hereunder for the ratable account of the Lenders in accordance with
their respective Commitments hereunder, and (v) all other fees and other amounts
due and payable on or prior to the Effective Date, including, to the extent
invoiced, all expenses required to be paid or reimbursed by the Borrowers
hereunder or under the Original Agreement.
4.2 EACH CREDIT EXTENSION. The Lenders shall not be required to make any
Credit Extension unless on the applicable Credit Extension Date:
(i) There exists no Default or Unmatured Default.
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(ii) The representations and warranties contained in Article V are
true and correct in all material respects as of such Credit Extension Date
except to the extent any such representation or warranty is stated to
relate solely to an earlier date, in which case such representation or
warranty shall have been true and correct in all material respects on and
as of such earlier date.
(iii) The Aggregate Outstanding Credit Exposure does not, and after
making such proposed Credit Extension would not, exceed the Maximum Credit
Amount.
Each Borrowing Notice, Swing Line Borrowing Notice or request for issuance
of a Facility LC, as the case may be, with respect to each such Credit Extension
shall constitute a representation and warranty by the applicable Borrower that
the conditions contained in Sections 4.2(i), (ii) and (iii) have been satisfied.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrowers jointly and severally represent and warrant to the Lenders
that:
5.1 EXISTENCE AND STANDING. Each of the Borrowers and the Subsidiaries is a
corporation duly and properly incorporated , validly existing and in good
standing under the laws of its jurisdiction of incorporation or organization and
has all requisite authority to conduct its business in each jurisdiction in
which its business is conducted, except for any failure to be so authorized that
could not reasonably be expected to have a Material Adverse Effect.
5.2 AUTHORIZATION AND VALIDITY. Each Borrower has the power and authority
and legal right to execute and deliver the Loan Documents to which it is a party
and to perform its obligations thereunder. The execution and delivery by each
Borrower of the Loan Documents to which it is a party and the performance of its
obligations thereunder have been duly authorized by proper corporate
proceedings, and the Loan Documents to which such Borrower is a party constitute
legal, valid and binding obligations of such Borrower enforceable against such
Borrower in accordance with their terms, except as enforceability may be limited
by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally.
5.3 NO CONFLICT; GOVERNMENT CONSENT. Neither the execution and delivery by
the Borrowers of the Loan Documents, nor the consummation of the transactions
therein contemplated, nor compliance with the provisions thereof will violate
(i) any law, rule, regulation, order, writ, judgment, injunction, decree or
award binding on the Company or any of its Subsidiaries or (ii) the Company's or
any Subsidiary's articles or certificate of incorporation or by-laws, or (iii)
the provisions of any material indenture, instrument or agreement to which the
Company or any of its Subsidiaries is a party or is subject, or by which it, or
its Property, is bound, or conflict with or constitute a default thereunder, or
result in, or require, the creation or imposition of any Lien in, of or on the
Property of the Company or a Subsidiary pursuant to the terms of any such
material indenture, instrument or agreement. No order, consent, adjudication,
approval, license, authorization, or validation of, or filing, recording or
registration with, or exemption by, or other action in respect of any
governmental or public body or authority, or any subdivision thereof, which has
35
not been obtained by the Company or any of its Subsidiaries, is required to be
obtained by the Company or any of its Subsidiaries in connection with the
execution and delivery of the Loan Documents, the borrowings under this
Agreement, the payment and performance by the Borrowers of the Obligations or
the legality, validity, binding effect or enforceability of any of the Loan
Documents.
5.4 FINANCIAL STATEMENTS. The March 31, 2001 consolidated financial
statements of the Company and its Subsidiaries heretofore delivered to the
Lenders were prepared in accordance with generally accepted accounting
principles in effect on the date such statements were prepared and fairly
present the consolidated financial condition and operations of the Company and
its Subsidiaries at such date and the consolidated results of their operations
for the period then ended, subject to normal year-end adjustments and the
absence of notes.
5.5 MATERIAL ADVERSE CHANGE. Except as set forth on Schedule 5.5, since
March 31, 2001 there has been no change in the business, Property, prospects,
condition (financial or otherwise) or results of operations of the Company and
its Subsidiaries which could reasonably be expected to have a Material Adverse
Effect.
5.6 TAXES. The Company and its Subsidiaries have filed all United States
federal tax returns and all other tax returns which are required to be filed and
have paid all taxes due pursuant to said returns or pursuant to any assessment
received by the Company or any of its Subsidiaries, except such taxes, if any,
as are being contested in good faith and as to which adequate reserves have been
provided in accordance with Agreement Accounting Principles. The charges,
accruals and reserves on the books of the Company and its Subsidiaries in
respect of any taxes or other governmental charges are adequate.
5.7 LITIGATION AND CONTINGENT OBLIGATIONS. Except as set forth on Schedule
5.7, there is no litigation, arbitration, governmental investigation, proceeding
or inquiry pending or, to the knowledge of any of their officers, threatened
against or affecting the Company or any of its Subsidiaries which could
reasonably be expected to have a Material Adverse Effect or which seeks to
prevent, enjoin or delay the making of any Credit Extensions. Other than any
liability incident to any litigation, arbitration or proceeding which could not
reasonably be expected to have a Material Adverse Effect, the Company and its
Subsidiaries have no material contingent obligations not provided for or
disclosed in the financial statements referred to in Section 5.4.
5.8 SUBSIDIARIES. Schedule 5.8 contains an accurate list of all
Subsidiaries of the Company as of the Effective Date, setting forth their
respective jurisdictions of incorporation and the percentage of their respective
capital stock owned by the Company or other Subsidiaries. All of the issued and
outstanding shares of capital stock of such Subsidiaries have been duly
authorized and issued and are fully paid and non-assessable.
5.9 ERISA. There are no Unfunded Liabilities under any Single Employer
Plans, and neither the Company nor any other member of the Controlled Group has
incurred, or is reasonably expected to incur, any withdrawal liability to
Multiemployer Plans, the amount of which Unfunded Liabilities and/or withdrawal
liabilities, in the aggregate, could reasonably be expected to have a Material
Adverse Effect. Each Plan complies in all material respects with all applicable
requirements of law and regulations, to the knowledge of the Company no
Reportable Event has occurred with respect to any Plan, neither the Company nor
36
any other member of the Controlled Group has withdrawn from any Plan or
initiated steps to do so, and to the knowledge of the Company no steps have been
taken to reorganize or terminate any Plan.
5.10 ACCURACY OF INFORMATION. No information, certificate or report
furnished by the Company or any of its Subsidiaries to the Agent or to any
Lender in connection with the negotiation of, or compliance with, the Loan
Documents contained any material misstatement of fact or omitted to state a
material fact or any fact necessary to make the statements contained therein not
misleading in any material respect.
5.11 REGULATION U. Neither the Company nor any of its Subsidiaries is
engaged in the business of extending credit for the purpose of purchasing or
carrying margin stock (as defined in Regulation U).
5.12 MATERIAL AGREEMENTS. Neither the Company nor any Subsidiary is a party
to any agreement or instrument or subject to any charter or other corporate
restriction which could reasonably be expected to have a Material Adverse
Effect. Neither the Company nor any Subsidiary is in default in the performance,
observance or fulfillment of any of the obligations, covenants or conditions
contained in any agreement to which it is a party, which default could
reasonably be expected to have a Material Adverse Effect.
5.13 COMPLIANCE WITH LAWS. The Company and its Subsidiaries have complied
with all applicable statutes, rules, regulations, orders and restrictions of any
domestic or foreign government or any instrumentality or agency thereof having
jurisdiction over the conduct of their respective businesses or the ownership of
their respective Property, except for any failure to comply with any of the
foregoing which could not reasonably be expected to have a Material Adverse
Effect.
5.14 OWNERSHIP OF PROPERTIES. Except as set forth on Schedule 6.15, as of
the Effective Date, the Company and its Subsidiaries will have good title, free
of all Liens other than those permitted by Section 6.15, to all of the Property
and assets reflected in the Company's most recent consolidated financial
statements provided to the Agent as owned by the Company and its Subsidiaries
and all other Property material to the Company's and its Subsidiaries'
businesses, except as sold or otherwise disposed of in the ordinary course of
business. The Company and each Subsidiary owns and/or possesses all the patents,
trademarks, trade names, service marks, copyrights, licenses and rights with
respect to the foregoing necessary for the present conduct of its business
without any known conflict with the rights of others, except where the failure
to own and/or possess any patents, trademarks, trade names, service marks,
copyrights, licenses and/or rights could not reasonably be expected to have a
Material Adverse Effect and/or subject the Company or any Subsidiary to any
material liability in connection with any infringement and/or similar cause of
action related to any of the foregoing.
5.15 PLAN ASSETS; PROHIBITED TRANSACTIONS. None of the Borrowers is an
entity deemed to hold "plan assets" within the meaning of 29 C.F.R. ss.
2510.3-101 of an employee benefit plan (as defined in Section 3(3) of ERISA)
which is subject to Title I of ERISA or any plan (within the meaning of Section
4975 of the Code), and neither the execution of this Agreement nor the making of
Credit Extensions hereunder gives rise to a prohibited transaction (within the
meaning of Section 406 of ERISA or Section 4975 of the Code) with respect to
"plan assets" of the Company and its Subsidiaries.
37
5.16 ENVIRONMENTAL MATTERS. In the ordinary course of its business, the
officers of the Company consider the effect of Environmental Laws on the
business of the Company and its Subsidiaries, in the course of which they
identify and evaluate potential risks and liabilities accruing to the Company
and its Subsidiaries due to Environmental Laws. On the basis of this
consideration, the Company has concluded that Environmental Laws cannot
reasonably be expected to have a Material Adverse Effect. Neither the Company
nor any Subsidiary has any knowledge or has received any actual notice to the
effect that its operations are not in material compliance with any of the
requirements of applicable Environmental Laws or are the subject of any federal
or state investigation evaluating whether any remedial action is needed to
respond to a release of any toxic or hazardous waste or substance into the
environment, which non-compliance or remedial action could reasonably be
expected to have a Material Adverse Effect.
5.17 INVESTMENT COMPANY ACT. Neither the Company nor any Subsidiary is an
"investment company" or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended.
5.18 PUBLIC UTILITY HOLDING COMPANY ACT. Neither the Company nor any
Subsidiary is a "holding company" or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
5.19 SUBORDINATED INDEBTEDNESS. The Obligations constitute senior
indebtedness which is entitled to the benefits of the subordination provisions
of all outstanding Subordinated Indebtedness.
5.20 INSURANCE. Schedule 5.20 accurately sets forth as of the Effective
Date all insurance policies and programs currently in effect with respect to the
respective properties and assets and business of the Company and its
Subsidiaries, specifying, for each such policy and program, (i) the amount
thereof, (ii) the risks insured against thereby, (iii) the name of the insurer
and each insured party thereunder, (iv) the policy or other identification
number thereof, (v) the expiration date thereof, (vi) the annual premium with
respect thereto, and (vii) any reserves relating to any self-insurance program
that is in effect.
ARTICLE VI
COVENANTS
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1 FINANCIAL REPORTING. The Company will maintain, for itself and each
Subsidiary, a system of accounting established and administered in accordance
with generally accepted accounting principles, and furnish to the Lenders:
(i) Within 105 days after the close of each of its fiscal years, an
unqualified (except for qualifications relating to changes in accounting
principles or practices reflecting changes in generally accepted accounting
38
principles and required or approved by the Company's independent certified
public accountants) audit report certified by independent certified public
accountants acceptable to the Required Lenders, prepared in accordance with
Agreement Accounting Principles on a consolidated and consolidating (by
segment or line of business) basis for itself and its Subsidiaries
(consolidating statements need not be certified by such accountants),
including balance sheets as of the end of such period, related profit and
loss and reconciliation of surplus statements, and a statement of cash
flows, accompanied by (a) any management letter prepared by said
accountants, and (b) a certificate of said accountants that, in the course
of their examination necessary for their certification of the foregoing,
they have obtained no knowledge of any Default or Unmatured Default, or if,
in the opinion of such accountants, any Default or Unmatured Default shall
exist, stating the nature and status thereof.
(ii) Within 45 days after the close of the first three quarterly
periods of each of its fiscal years, for itself and its Subsidiaries,
consolidated and consolidating (by segment or line of business) unaudited
balance sheets as at the close of each such period and consolidated and
consolidating (by segment or line of business) profit and loss and
reconciliation of surplus statements and a statement of cash flows for the
period from the beginning of such fiscal year to the end of such quarter,
all certified by its principal financial officer or corporate controller.
(iii) As soon as possible, and in any event within 30 days after the
end of each calendar month, for itself and its Subsidiaries, consolidated
and consolidating (by segment or line of business) unaudited balance sheets
as at the end of such period and consolidated and consolidating (by segment
or line of business) profit and loss and reconciliation of surplus
statements and a statement of cash flows for such calendar month, all
certified by its principal financial officer or corporate controller.
(iv) As soon as available, but in any event within 60 days prior the
beginning of each fiscal year of the Company, a copy of the plan and
forecast (including a projected consolidated and consolidating (by segment
or line of business) balance sheet, income statement and funds flow
statement) of the Company and its Subsidiaries for such fiscal year.
(v) Together with the financial statements required under Sections
6.1(i) and (ii), (A) a compliance certificate in substantially the form of
Exhibit B signed by its principal financial officer or corporate controller
showing the calculations necessary to determine compliance with this
Agreement and stating that no Default or Unmatured Default exists, or if
any Default or Unmatured Default exists, stating the nature and status
thereof, and (B) a copy of the Company's most recently completed weekly
contract variance report.
(vi) As soon as possible, and in any event within 30 days after the
close of each calendar month (and more often if requested by the Agent or
the Required Lenders), a Borrowing Base Certificate, together with such
supporting documents as the Agent may request, all certified as being true
and correct by its principal financial officer or corporate controller.
39
(vii) Within 270 days after the close of each fiscal year, a statement
of the Unfunded Liabilities of each Single Employer Plan, certified as
correct by an actuary enrolled under ERISA.
(viii) As soon as possible and in any event within 10 days after the
Company knows that any Reportable Event has occurred with respect to any
Plan, a statement, signed by the principal financial officer or corporate
controller of the Company, describing said Reportable Event and the action
which the Company proposes to take with respect thereto.
(ix) As soon as possible and in any event within 10 days after receipt
by the Company, copy of (a) any notice or claim to the effect that the
Company or any of its Subsidiaries is or may be liable to any Person as a
result of the release by the Company, any of its Subsidiaries, or any other
Person of any toxic or hazardous waste or substance into the environment,
and (b) any notice alleging any violation of any federal, state or local
environmental, health or safety law or regulation by the Company or any of
its Subsidiaries, which, in either case, could reasonably be expected to
have a Material Adverse Effect.
(x) Promptly upon the furnishing thereof to the shareholders of the
Company, copies of all financial statements, reports and proxy statements
so furnished.
(xi) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other regular reports which
the Company or any of its Subsidiaries files with the Securities and
Exchange Commission.
(xii) As soon as practicable, and in any event within 30 days after
the end of each calendar month, a Work-in-Progress Report, substantially in
the form attached hereto as Exhibit F, as at the end of such period.
(xiii) As soon as possible, and in any event within 30 days after the
end of each calendar month, a Backlog Report, substantially in the form
attached hereto as Exhibit G, as at the end of such period.
(xiv) As soon as possible, and in any event within 30 days after the
end of each calendar month, a Monthly Cash Summary, substantially in the
form attached hereto as Exhibit H, as at the end of such period.
(xv) As soon as possible, and in any event within 30 days after the
end of each calendar month, an Accounts Receivable Aging Report,
substantially in the form attached hereto as Exhibit I, as at the end of
such period.
(xvi) Such other information (including non-financial information) as
the Agent or any Lender may from time to time reasonably request.
40
6.2 USE OF PROCEEDS. The Borrowers will, and will cause each Subsidiary to,
use the proceeds of the Credit Extensions for general corporate purposes. The
Borrowers will not, nor will it permit any Subsidiary to, use any of the
proceeds of the Advances to purchase or carry any margin stock (as defined in
Regulation U).
6.3 NOTICE OF DEFAULT. The Company will, and will cause each Subsidiary to,
give prompt notice in writing to the Lenders of the occurrence of any Default or
Unmatured Default and of any other development, financial or otherwise, which
could reasonably be expected to have a Material Adverse Effect.
6.4 CONDUCT OF BUSINESS. The Company will, and will cause each Subsidiary
to, carry on and conduct its business only in Approved Lines of Business and do
all things necessary to remain duly incorporated and in good standing as a
domestic corporation in its jurisdiction of incorporation and maintain all
requisite authority to conduct its business in each jurisdiction in which its
business is conducted, in each case, except to the extent (i) permitted by
Section 6.12 or (ii) that a failure to do so could not reasonably be expected to
have a Material Adverse Effect.
6.5 TAXES. The Company will, and will cause each Subsidiary to, timely file
complete and correct United States federal and applicable foreign, state and
local tax returns required by law and pay when due all taxes, assessments and
governmental charges and levies upon it or its income, profits or Property,
except those which are being contested in good faith by appropriate proceedings
and with respect to which adequate reserves have been set aside in accordance
with Agreement Accounting Principles.
6.6 INSURANCE; INSURANCE AND CONDEMNATION PROCEEDS. (a) The Company shall
maintain for itself and its Subsidiaries, or shall cause each of its
Subsidiaries to maintain, in full force and effect the insurance policies and
programs listed on Schedule 5.20 or substantially similar policies and programs
or other policies and programs as reflect coverage that is reasonably consistent
with prudent industry practice. The Company shall deliver to the Agent (i)
endorsements to all "All Risk" physical damage insurance policies on all of the
Company's and its Subsidiaries' tangible personal property and assets and
business interruption insurance policies naming the Agent loss payee, and (ii)
certificates as to all general liability and other liability policies naming the
Agent an additional insured. In the event the Company or any of its
Subsidiaries, at any time or times hereafter shall fail to obtain or maintain
any of the policies or insurance required herein or to pay any premium in whole
or in part relating thereto within ten days after written notice from the Agent,
then the Agent, without waiving or releasing any obligations or resulting
Default hereunder, may at any time or times thereafter so long as such failure
shall continue (but shall be under no obligation to do so) obtain and maintain
such policies of insurance and pay such premiums and take any other action with
respect thereto which the Agent deems advisable. All sums so disbursed by the
Agent shall constitute part of the Obligations, payable as provided in this
Agreement.
(b) The Company shall direct (and, if applicable, shall cause any
Subsidiary to direct) all insurers under policies of property insurance, flood
insurance, machinery and business interruption insurance and payors of any
damage or condemnation claim or award relating to such property to pay all
proceeds payable under such policies or with respect to such claim or award for
any loss with respect to the Collateral directly to the Agent, for the benefit
41
of the Agent and the Holders of the Secured Obligations; PROVIDED that if such
proceeds or award is less than $2,000,000 ("Excluded Proceeds"), unless a
Default shall have occurred and be continuing, the Agent shall remit such
Excluded Proceeds to the Company. Each such policy shall contain a long-form
loss-payable endorsement naming the Agent as loss payee, which endorsement shall
be in form and substance acceptable to the Agent. The Agent shall, upon receipt
of such proceeds (other than Excluded Proceeds) and at the Company's direction,
either apply the same to the principal amount of the Revolving Loans outstanding
at the time of such receipt and create a corresponding reserve against the
Aggregate Commitment in an amount equal to such application (the "Decision
Reserve") or hold them as cash collateral for the Obligations in an interest
bearing account. For up to one hundred eighty days from the date of any loss
(the "Decision Period"), the Company may notify the Agent that it intends to
restore, rebuild or replace the property subject to any insurance payment or
condemnation award and shall, as soon as practicable thereafter, provide the
Agent detailed information, including a construction schedule and cost
estimates. Should a Default occur and be continuing during the Decision Period,
should the Company notify the Agent during the Decision Period that it has
decided not to rebuild or replace such property, or should the Company fail to
notify the Agent of the Company's decision during the Decision Period, then the
amounts held as cash collateral pursuant to this Section 6.6 or as the Decision
Reserve shall upon the Required Lenders' direction be applied as a mandatory
prepayment of the Loans and the Aggregate Commitment shall automatically be
permanently reduced, ratably among the Lenders, in an amount equal to the amount
of such mandatory prepayment. Proceeds held as cash collateral pursuant to this
Section 6.6 or as the Decision Reserve shall be disbursed as payments for
restoration, rebuilding or replacement of such property become due; PROVIDED,
however, should a Default occur and be continuing after the Company has notified
the Agent that it intends to rebuild or replace the property, the Decision
Reserve or amounts held as cash collateral may, or shall, upon the Required
Lenders' direction, be applied as a mandatory prepayment of the Loans. Upon
completion of the restoration, rebuilding or replacement of such property, the
unused proceeds shall be released to the Company, PROVIDED that no Default or
Unmatured Default shall have occurred and be continuing.
6.7 COMPLIANCE WITH LAWS. The Company will, and will cause each Subsidiary
to, comply with all laws, rules, regulations, orders, writs, judgments,
injunctions, decrees or awards to which it may be subject including, without
limitation, all Environmental Laws, except for violations that individually or
in the aggregate could not reasonably be expected to have a Material Adverse
Effect.
6.8 MAINTENANCE OF PROPERTIES. The Company will, and will cause each
Subsidiary to, do all things necessary to maintain, preserve, protect and keep
its Property in good repair, working order and condition, and make all necessary
and proper repairs, renewals and replacements so that its business carried on in
connection therewith may be properly conducted at all times in all material
respects.
6.9 INSPECTION. The Company will, and will cause each Subsidiary to, permit
the Agent and the Lenders, by their respective representatives and agents, to
inspect any of the Property, books and financial records of the Company and each
Subsidiary, to examine and make copies of the books of accounts and other
financial records of the Company and each Subsidiary, and to discuss the
affairs, finances and accounts of the Company and each Subsidiary with, and to
be advised as to the same by, their respective officers at such reasonable times
and intervals as the Agent or any Lender may designate.
42
6.10 DIVIDENDS. The Company will not, nor will it permit any Subsidiary to,
declare or pay any dividends or make any distributions on its capital stock
(other than dividends payable in its own capital stock) or redeem, repurchase or
otherwise acquire or retire any of its capital stock at any time outstanding,
except:
(i) Any Subsidiary may declare and pay dividends or make distributions
to the Company or to a Wholly-Owned Subsidiary.
(ii) The Company may issue its common stock upon the conversion of any
of its convertible preferred stock.
(iii) The Company may declare and pay a dividend on, and redeem or
repurchase, its preferred stock in cash as a consequence of its failure to
deliver its common stock in connection with a conversion of such preferred
stock.
6.11 INDEBTEDNESS. The Company will not, nor will it permit any Subsidiary
to, create, incur or suffer to exist any Indebtedness, except:
(i) The Loans and the Reimbursement Obligations.
(ii) Indebtedness existing on the date hereof and described in
Schedule 6.11.
(iii) Indebtedness arising under Rate Management Transactions.
(iv) Subordinated Indebtedness in an aggregate principal amount not to
exceed $150,000,000 at any one time outstanding.
(v) Capitalized Lease Obligations and/or Indebtedness secured by
purchase money Liens in an aggregate amount not to exceed $30,000,000 at
any one time outstanding, including any refinancing of such purchase money
Indebtedness PROVIDED that such refinancing does not increase the principal
amount of such Indebtedness or extend the Lien to any additional Property.
(vi) Mortgage financing for the acquisition or improvement of real
property in an aggregate principal amount not to exceed $6,000,000 at any
one time outstanding.
(vii) Indebtedness of any Borrower (other than the Company) to the
Company, PROVIDED that such Indebtedness shall be unsecured, shall not be
evidenced by a note or other instrument, and shall be expressly subordinate
to the payment in full of the Secured Obligations in a manner reasonably
satisfactory in form and substance to the Agent.
(viii) Indebtedness of any Foreign Subsidiary to the Company, PROVIDED
that such Indebtedness shall not be evidenced by a note or other
instrument, and PROVIDED FURTHER that such Indebtedness complies with
Section 6.14(v).
(ix) Contingent Obligations permitted Section 6.20.
43
6.12 MERGER. The Company will not, nor will it permit any Subsidiary to,
merge or consolidate with or into any other Person, except (i) that a Subsidiary
may merge into the Company or a Wholly-Owned Subsidiary or (ii) the Company or
any Subsidiary may merge in connection with a Permitted Acquisition, PROVIDED
that in any merger to which the Company is party, the Company shall be the
surviving corporation.
6.13 SALE OF ASSETS. The Company will not, nor will it permit any
Subsidiary to, lease, sell or otherwise dispose of its Property to any other
Person, except:
(i) Sales of inventory in the ordinary course of business.
(ii) Sales of obsolete or surplus equipment and equipment traded in or
exchanged for replacement equipment, together with any intellectual
property reasonably related thereto, in each case in the ordinary course of
business.
(iii) Leases and other transfers of Property between any Borrowers.
(iv) Sales and other dispositions of Property on or prior to March 31,
2002 in connection with the discontinuance of operations of the Equipment
Distribution Group.
(v) Sales and other dispositions of Mortgaged Real Property, subject
to Section 2.7.2(b).
6.14 INVESTMENTS AND ACQUISITIONS. The Company shall not, nor will it
permit any Subsidiary to, make or suffer to exist any Investments (including
without limitation, loans and advances to, and other Investments in,
Subsidiaries), or commitments therefor, or to create any Subsidiary or to become
or remain a partner in any partnership or joint venture, or to make any
Acquisition, except:
(i) Cash Equivalent Investments.
(ii) Existing Investments in Subsidiaries and other Investments in
existence on the date hereof and described in Schedule 6.14.
(iii) Permitted Acquisitions, PROVIDED that the Company shall have
obtained the prior written consent of the Required Lenders.
(iv) The Company may make loans or advances to other Borrowers
permitted by Section 6.11(vii).
(v) The Company may make loans and advances to Foreign Subsidiaries
permitted by Section 6.11 (viii), PROVIDED that the aggregate amount of
such Indebtedness outstanding at any one time, together with the aggregate
Purchase Price of all Permitted Acquisitions consummated during the term of
this Agreement involving the acquisition or creation of a Foreign
Subsidiary, shall not exceed $5,000,000.
44
6.15 LIENS. The Company will not, nor will it permit any Subsidiary to,
create, incur, or suffer to exist any Lien in, of or on the Property of the
Company or any of its Subsidiaries, except:
(i) Liens for taxes, assessments or governmental charges or levies
(other than Liens imposed by the PBGC) on its Property if the same shall
not at the time be delinquent or thereafter can be paid without penalty, or
are being contested in good faith and by appropriate proceedings and for
which adequate reserves in accordance with Agreement Accounting Principles
shall have been set aside on its books.
(ii) Liens imposed by law, such as carriers', warehousemen's and
mechanics' liens and other similar liens arising in the ordinary course of
business which secure payment of obligations not more than 60 days past due
or which are being contested in good faith by appropriate proceedings and
for which adequate reserves shall have been set aside on its books.
(iii) Liens arising out of pledges or deposits under worker's
compensation laws, unemployment insurance, old age pensions, or other
social security or retirement benefits, or similar legislation.
(iv) Utility easements, building restrictions and such other
encumbrances or charges against real property as are of a nature generally
existing with respect to properties of a similar character and which do not
in any material way affect the marketability of the same or interfere with
the use thereof in the business of the Company or its Subsidiaries.
(v) Liens existing on the date hereof and described in Schedule 6.15.
(vi) Liens in favor of the Agent, for the benefit of the Holders of
Secured Obligations, granted pursuant to any Collateral Document.
(vii) Liens arising under Capitalized Leases and purchase money Liens
(including refinancings thereof) permitted by Section 6.11(v).
(viii) Liens on real property securing Indebtedness permitted by
Section 6.11(vi).
(ix) Liens to secure the performance of statutory obligations, bids,
leases, government contracts, performance and surety bonds and other
similar obligations in the ordinary course of business.
(x) Bankers' liens and rights of setoff arising by operation of law
and contractual rights of setoff.
6.16 CAPITAL EXPENDITURES. The Company will not, nor will it permit any
Subsidiary to, expend, or be committed to expend, in excess of $15,000,000 for
Capital Expenditures during the period from April 1, 2001 to March 31, 2002 or
during each fiscal year ending thereafter, on a non-cumulative basis in the
aggregate for the Company and its Subsidiaries.
45
6.17 AFFILIATES. The Company will not, and will not permit any Subsidiary
to, enter into any transaction (including, without limitation, the purchase or
sale of any Property or service) with, or make any payment or transfer to, any
Affiliate except in the ordinary course of business and pursuant to the
reasonable requirements of the Company's or such Subsidiary's business and upon
fair and reasonable terms no less favorable to the Company or such Subsidiary
than the Company or such Subsidiary would obtain in a comparable arms-length
transaction.
6.18 SUBORDINATED INDEBTEDNESS. The Company will not, and will not permit
any Subsidiary to, make any amendment or modification to the indenture, note or
other agreement evidencing or governing any Subordinated Indebtedness which is
adverse to the interests of the Lenders, or directly or indirectly voluntarily
prepay, defease or in substance defease, purchase, redeem, retire or otherwise
acquire, any Subordinated Indebtedness. The Company shall give the Agent ten
Business Days' prior written notice of the terms of any amendment or
modification to the indenture, note or other agreement evidencing or governing
any Subordinated Indebtedness.
6.19 SALE AND LEASEBACK TRANSACTIONS AND OTHER OFF-BALANCE SHEET
LIABILITIES. The Company will not, nor will it permit any Subsidiary to, enter
into or suffer to exist any (i) Sale and Leaseback Transaction, except Sale and
Leaseback Transactions with respect to the Mortgaged Real Property, subject to
Section 2.7.2(b), or (ii) any other transaction pursuant to which it incurs or
has incurred Off-Balance Sheet Liabilities, except for Rate Management
Transactions permitted under the terms of Section 6.21.
6.20 CONTINGENT OBLIGATIONS. The Company will not, nor will it permit any
Subsidiary to, make or suffer to exist any Contingent Obligation (including,
without limitation, any Contingent Obligation with respect to the obligations of
a Subsidiary), except (i) by endorsement of instruments for deposit or
collection in the ordinary course of business, (ii) the Reimbursement
Obligations, (iii) joint and several liability of the Borrowers for the
Obligations, (iv) Contingent Obligations of the Company with respect to
obligations of any Subsidiary and (v) obligations arising in connection with
performance and surety bonds in the ordinary course of business.
6.21 FINANCIAL CONTRACTS. The Company will not, nor will it permit any
Subsidiary to, enter into or remain liable upon any Financial Contract, except
Financial Contracts pursuant to which the Company or any Subsidiary has hedged
its reasonably estimated interest rate, foreign currency or commodity exposure.
6.22 FINANCIAL COVENANTS.
6.22.1. INTEREST COVERAGE RATIO. The Company will not permit the
Interest Coverage Ratio, determined as of the end of each of its fiscal
quarters for the then most-recently ended four fiscal quarters, to be less
than 1.25 to 1 for each fiscal quarter ending on or before September 30,
2001; to be less than 1.50 to 1 for the fiscal quarter ending on December
31, 2001; to be less than 1.75 to 1 for the fiscal quarter ending on March
31, 2002; or to be less than 2.50 to 1 for each fiscal quarter ending
thereafter.
46
6.22.2. FIXED CHARGE COVERAGE RATIO. The Company will not permit the
Fixed Charge Coverage Ratio, determined as of the end each of its fiscal
quarters for the then most recently ended four fiscal quarters, to be less
than 1.25 to 1 for each fiscal quarter ending on or before March 31, 2002,
or to be less than 1.50 to 1 for each fiscal quarter ending thereafter.
6.22.3. ADJUSTED LEVERAGE RATIO. The Company will not permit the
Adjusted Leverage Ratio, determined as of the end of each of its fiscal
quarters, to be greater than 3.75 to 1 at the end of each fiscal quarter
ending on or before September 30, 2001; to be greater than 3.60 to 1 at the
end of the fiscal quarter ending on December 31, 2001; to be greater than
3.25 to 1 at the end of the fiscal quarter ending on March 31, 2002; or to
be greater than 2.50 to 1 at the end of each fiscal quarter ending
thereafter.
6.22.4. MINIMUM NET WORTH. The Company will at all times maintain
Consolidated Net Worth of not less than the sum of (i) $120,000,000 PLUS
(ii) 50% of Consolidated Net Income earned in each fiscal quarter beginning
with the quarter ending June 30, 2001 (without deduction for losses for any
such fiscal quarter) PLUS (iii) the amount of any addition to the
consolidated stockholders' equity of the Company and its Subsidiaries at
any time resulting from the issuance or sale of any Equity Interests by the
Company after June 30, 2001.
6.22.5. LOSSES. The Company shall not permit (i) the net after tax
loss incurred by the Wireless Technology Group after March 31, 2001 and
prior to April 1, 2002 to be greater than $3,000,000 or (ii) Consolidated
Net Income for any fiscal quarter to be less than zero.
6.22.6. CALCULATION OF FINANCIAL COVENANTS.
(a) For purposes of calculating each of the financial covenants
contained in this Section 6.22, the outstanding principal amount of the
Loans hereunder as of the last day of the fiscal period for which such
financial covenant is calculated shall be reduced by the amount of Blocked
Cash on deposit at the close of business on such day, but only to the
extent that such amount of Blocked Cash was on such day or subsequently
shall have been collected.
(b) In the event that the Company or any Subsidiary shall have
consummated a Permitted Acquisition during any four fiscal quarter period
for which any financial covenant contained in this Section 6.22 is
calculated, such financial covenant shall be calculated as if such
Permitted Acquisition (including any Indebtedness incurred in connection
therewith) had been consummated on the first day of such four fiscal
quarter period, PROVIDED that the Company shall not include such Permitted
Acquisition in the calculation of Consolidated EBIT or Adjusted EBITDA
unless the Company shall have delivered to the Lenders, at or prior to the
time financial statements as of the last day of such four fiscal quarter
period are delivered to the Lenders pursuant to Section 6.1, audited
financial statements of the acquired business or Person, stated in U.S.
Dollars and presented in conformity with U.S. generally accepted accounting
principles, and covering the period from the first day of such four fiscal
quarter period to the actual date of the consummation of such Permitted
Acquisition. The audit report with respect to such financial statements
shall be certified by independent certified public accountants acceptable
to the Agent.
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6.23 SUBSIDIARIES. If at any time after the date hereof, the Company or any
Subsidiary shall create or acquire any Subsidiary, the Company shall promptly
notify the Agent thereof, which notice shall specify the date as of which such
Subsidiary became a Subsidiary. Within 60 days after the date specified in such
notice, the Company shall (i) cause such Subsidiary to execute and deliver to
the Agent a Joinder Agreement and such Collateral Documents with respect to
substantially all of the Property of such Subsidiary as the Agent shall
reasonably request (all such Collateral Documents to be in form and substance
reasonably satisfactory to the Agent) and (ii) pledge and/or cause any other
Subsidiary to pledge to the Agent, for the benefit of the Holders of Secured
Obligations, all of the Equity Interests of such Subsidiary held by the Company
or any other Subsidiary, in each case together with such supporting
documentation, including authorizing resolutions and/or opinions of counsel, as
the Agent may reasonably request. Notwithstanding the foregoing, (A) if the
Company or any of its Subsidiaries acquires a Subsidiary pursuant to a Permitted
Acquisition, the Company may, as an alternative to complying with the preceding
sentence, within 60 days after the consummation of such Permitted Acquisition,
cause such Subsidiary to merge into, or to transfer all or substantially all of
its assets to, any other Borrower, and (B) if such acquired or created
Subsidiary is a Foreign Subsidiary, such Foreign Subsidiary shall not be
required to execute and deliver to the Agent a Joinder Agreement or any
Collateral Documents and the Company and any other Subsidiary shall not be
required to pledge to the Agent more than 65% of such Foreign Subsidiary's
capital stock or other Equity Interests.
6.24 ISSUANCE OF STOCK. The Company shall, by June 30, 2001, have received
gross cash proceeds of at least $10,000,000 from the issuance by the Company of
common stock or convertible preferred stock pursuant to an Equity Financing.
6.25 FUTURE LIENS ON REAL PROPERTY. Each Borrower shall execute and deliver
to the Agent, within 30 days after its acquisition of any real property, a
mortgage, deed of trust or other appropriate instrument evidencing a Lien upon
any such acquired property, to be in form and substance reasonably acceptable to
the Agent and subject only to such Liens as otherwise shall be permitted by this
Agreement, and a title insurance policy insuring the Agent's interest therein.
The foregoing provision shall not apply to real property acquired with purchase
money financing otherwise permitted hereunder, until such purchase money
financing has been repaid and the purchase money lien released.
6.26 NOTICE OF REDEMPTION OF PREFERRED STOCK. Upon receipt by the Company
of any notice from a holder of such preferred stock demanding the redemption of
such preferred stock as a result of the failure by the Company to deliver its
common stock pursuant to such holder's election to convert such preferred stock
into such common stock, the Company shall promptly (but in any event written one
Business Day following such receipt) send a copy of such notice to the Agent.
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ARTICLE VII
DEFAULTS
The occurrence of any one or more of the following events shall constitute
a Default:
7.1 Any representation or warranty made or deemed made by or on behalf of
the Company or any of its Subsidiaries to the Lenders or the Agent under or in
connection with this Agreement or any other Loan Document, any Credit Extension,
or any certificate or information delivered in connection with this Agreement or
any other Loan Document shall be materially false on the date as of which made.
7.2 Nonpayment of principal of any Loan when due, nonpayment of any
Reimbursement Obligation within one Business Day after the same becomes due, or
nonpayment of interest upon any Loan or of any commitment fee, LC Fee or other
obligations under any of the Loan Documents within five Business Days after the
same becomes due.
7.3 The breach by the Company or any of its Subsidiaries of any of the
terms or provisions of Article VI Section 6.2, 6.10, 6.11, 6.12, 6.13, 6.14,
6.15, 6.16, 6.17, 6.18, 6.19, 6.20, 6.21, 6.22 (Financial Covenants), 6.24, 6.25
or 6.26, PROVIDED that a breach of Section 6.15 occurring as a result of a
non-consensual Lien securing an obligation not in excess of $1,000,000 shall not
constitute a Default unless such breach shall not have been remedied within 30
days after such Lien arose.
7.4 The breach by the Company or any of its Subsidiaries (other than a
breach which constitutes a Default under another Section of this Article VII) of
any of the terms or provisions of this Agreement or any other Loan Document
which is not remedied within twenty days after written notice from the Agent or
any Lender.
7.5 Failure of the Company or any of its Subsidiaries to pay when due any
Indebtedness aggregating in excess of $1,000,000 ("Material Indebtedness"); or
the default by the Company or any of its Subsidiaries in the performance (beyond
the applicable grace period with respect thereto, if any) of any term, provision
or condition contained in any agreement under which any such Material
Indebtedness was created or is governed, or any other event shall occur or
condition exist, the effect of which default or event is to cause, or to permit
the holder or holders of such Material Indebtedness to cause, such Material
Indebtedness to become due prior to its stated maturity; or any Material
Indebtedness of the Company or any of its Subsidiaries shall be declared to be
due and payable or required to be prepaid or repurchased (other than by a
regularly scheduled payment) prior to the stated maturity thereof; or the
Company or any of its Subsidiaries shall not pay, or admit in writing its
inability to pay, its debts generally as they become due.
7.6 The Company or any of its Subsidiaries shall (i) have an order for
relief entered with respect to it under the Federal bankruptcy laws as now or
hereafter in effect, (ii) make an assignment for the benefit of creditors, (iii)
apply for, seek, consent to, or acquiesce in, the appointment of a receiver,
custodian, trustee, examiner, liquidator or similar official for it or any
Substantial Portion of its Property, (iv) institute any proceeding seeking an
order for relief under the Federal bankruptcy laws as now or hereafter in effect
49
or seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution,
winding up, liquidation, reorganization, arrangement, adjustment or composition
of it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fail to file an answer or other pleading
denying the material allegations of any such proceeding filed against it, (v)
take any corporate or partnership action to authorize or effect any of the
foregoing actions set forth in this Section 7.6 or (vi) fail to contest in good
faith any appointment or proceeding described in Section 7.7.
7.7 Without the application, approval or consent of the Company or any of
its Subsidiaries, a receiver, trustee, examiner, liquidator or similar official
shall be appointed for the Company or any of its Subsidiaries or any Substantial
Portion of its Property, or a proceeding described in Section 7.6(iv) shall be
instituted against the Company or any of its Subsidiaries and such appointment
continues undischarged or such proceeding continues undismissed or unstayed for
a period of 60 consecutive days.
7.8 Any court, government or governmental agency shall condemn, seize or
otherwise appropriate, or take custody or control of, all or any portion of the
Property of the Company and its Subsidiaries which, when taken together with all
other Property of the Company and its Subsidiaries so condemned, seized,
appropriated, or taken custody or control of, during the twelve-month period
ending with the month in which any such action occurs, constitutes a Substantial
Portion.
7.9 The Company or any of its Subsidiaries shall fail within 30 days to
pay, bond or otherwise discharge one or more (i) judgments or orders for the
payment of money in excess of $5,000,000 (or the equivalent thereof in
currencies other than U.S. Dollars) in the aggregate, or (ii) nonmonetary
judgments or orders which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect, which judgment(s), in any such case,
is/are not stayed on appeal or otherwise being appropriately contested in good
faith.
7.10 Any Unfunded Liabilities shall exist under any Single Employer Plan or
any Reportable Event shall occur in connection with any Plan, in either case,
which could reasonably be expected to have a Material Adverse Effect.
7.11 The Company or any other member of the Controlled Group shall have
been notified by the sponsor of a Multiemployer Plan that it has incurred
withdrawal liability to such Multiemployer Plan in an amount which, when
aggregated with all other amounts required to be paid to Multiemployer Plans by
the Company or any other member of the Controlled Group as withdrawal liability
(determined as of the date of such notification), could reasonably be expected
to have a Material Adverse Effect.
7.12 The Company or any other member of the Controlled Group shall have
been notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or is being terminated, within the meaning of Title IV
of ERISA, if as a result of such reorganization or termination the aggregate
annual contributions of the Company and the other members of the Controlled
Group (taken as a whole) to all Multiemployer Plans which are then in
reorganization or being terminated have been or will be increased over the
amounts contributed to such Multiemployer Plans for the respective plan years of
50
each such Multiemployer Plan immediately preceding the plan year in which the
reorganization or termination occurs by an amount which could reasonably be
expected to have a Material Adverse Effect.
7.13 The Company or any of its Subsidiaries shall (i) be the subject of any
proceeding or investigation pertaining to the release by the Company, any of its
Subsidiaries or any other Person of any toxic or hazardous waste or substance
into the environment, or (ii) violate any Environmental Law, which, in the case
of an event described in clause (i) or clause (ii), could reasonably be expected
to have a Material Adverse Effect.
7.14 Any Change in Control shall occur.
7.15 Nonpayment by the Company or any Subsidiary of any Rate Management
Obligation when due or the breach by the Company or any Subsidiary of any term,
provision or condition contained in any Rate Management Transaction.
7.16 Any Collateral Document shall for any reason, other than an act or
omission of the Agent or any Holder of Secured Obligations, fail to create a
valid and perfected security interest in the Collateral purported to be covered
thereby, subject only to the Liens permitted by the Credit Agreement, and such
failure shall not be remedied within ten days; or any Borrower shall take any
action to discontinue or to assert the invalidity or unenforceability of any
Collateral Document, whether as to such Borrower or in its entirety.
7.17 The Company shall fail to comply in a timely manner with the terms of
any preferred stock issued by the Company pursuant to which any holder thereof
shall have elected to convert such preferred stock to common stock of the
Company, and as a consequence thereof any such holder shall have given notice to
the Company demanding the redemption of such preferred stock.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1 ACCELERATION; FACILITY LC COLLATERAL ACCOUNT. (i) If any Default
described in Section 7.6 or 7.7 occurs with respect to any Borrower, the
obligations of the Lenders to make Loans hereunder and the obligation and power
of the LC Issuer to issue Facility LCs shall automatically terminate and the
Obligations shall immediately become due and payable without any election or
action on the part of the Agent, the LC Issuer or any Lender, and the Borrowers
will be and become thereby unconditionally obligated, without any further
notice, act or demand, to pay to the Agent an amount in immediately available
funds, which funds shall be held in the Facility LC Collateral Account, equal to
the difference of (x) the amount of LC Obligations at such time, less (y) the
amount on deposit in the Facility LC Collateral Account at such time which is
free and clear of all rights and claims of third parties and has not been
applied against the Obligations (such difference, the "Collateral Shortfall
Amount"). If any other Default occurs and is continuing, the Required Lenders
(or the Agent with the consent of the Required Lenders) may (a) terminate or
suspend the obligations of the Lenders to make Loans hereunder and the
obligation and power of the LC Issuer to issue Facility LCs, or declare the
Obligations to be due and payable, or both, whereupon the Obligations shall
51
become immediately due and payable, without presentment, demand, protest or
notice of any kind, all of which the Borrowers hereby expressly waives, and (b)
upon notice to the Borrowers and in addition to the continuing right to demand
payment of all amounts payable under this Agreement, make demand on the
Borrowers to pay, and the Borrowers will, forthwith upon such demand and without
any further notice or act, pay to the Agent the Collateral Shortfall Amount,
which funds shall be deposited in the Facility LC Collateral Account.
(ii) If at any time while any Default is continuing, the Agent
determines that the Collateral Shortfall Amount at such time is greater
than zero, the Agent may make demand on the Borrowers to pay, and the
Borrowers will, forthwith upon such demand and without any further notice
or act, pay to the Agent the Collateral Shortfall Amount, which funds shall
be deposited in the Facility LC Collateral Account.
(iii) The Agent may at any time or from time to time after funds are
deposited in the Facility LC Collateral Account, apply such funds to the
payment of the Obligations and any other amounts as shall from time to time
have become due and payable by the Borrowers to the Lenders or the LC
Issuer under the Loan Documents.
(iv) At any time while any Default is continuing, neither any Borrower
nor any Person claiming on behalf of or through any Borrower shall have any
right to withdraw any of the funds held in the Facility LC Collateral
Account. After all of the Obligations have been indefeasibly paid in full
and the Aggregate Commitment has been terminated, any funds remaining in
the Facility LC Collateral Account shall be returned by the Agent to the
Borrowers or paid to whomever may be legally entitled thereto at such time.
(v) If, within 30 days after acceleration of the maturity of the
Obligations or termination of the obligations of the Lenders to make Loans
and the obligation and power of the LC Issuer to issue Facility LCs
hereunder as a result of any Default (other than any Default as described
in Section 7.6 or 7.7 with respect to any Borrower) and before any judgment
or decree for the payment of the Obligations due shall have been obtained
or entered, the Required Lenders (in their sole discretion) shall so
direct, the Agent shall, by notice to the Borrowers, rescind and annul such
acceleration and/or termination.
8.2 AMENDMENTS. Subject to the provisions of this Article VIII, the
Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and the Borrowers may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions to the Loan Documents or changing
in any manner the rights of the Lenders or the Borrowers hereunder or waiving
any Default hereunder; PROVIDED, HOWEVER, that no such supplemental agreement
shall, without the consent of each Lender affected thereby:
(i) Extend the final maturity of any Loan, or extend the expiry date
of any Facility LC to a date after the Facility Termination Date or forgive
all or any portion of the principal amount thereof or any Reimbursement
Obligation related thereto, or reduce the rate or extend the time of
payment of interest or fees thereon or Reimbursement Obligations related
thereto.
52
(ii) Reduce the percentage specified in the definition of Required
Lenders.
(iii) Extend the Facility Termination Date, or reduce the amount or
extend the payment date for, the mandatory payments required under Section
2.2, or increase the amount of the Aggregate Commitment (except as provided
in Section 2.1(b)), the Commitment of any Lender hereunder or the
commitment to issue Facility LCs, or permit any Borrower to assign its
rights under this Agreement.
(iv) Amend this Section 8.2.
(v) Release any Borrower from joint and several liability for the
Obligations or, except as provided in the Collateral Documents, release all
or substantially all of the Collateral.
Notwithstanding the foregoing, the Agent, the Borrowers and a Lender or other
financial institution providing an additional Commitment pursuant to Section
2.1(b) may enter into a supplement hereto for such purpose without the consent
of any other party hereto. No amendment of any provision of this Agreement
relating to the Agent shall be effective without the written consent of the
Agent, no amendment of any provision relating to the Swing Line Lender or any
Swing Line Loans shall be effective without the written consent of the Swing
Line Lender, and no amendment of any provision relating to the LC Issuer shall
be effective without the written consent of the LC Issuer. The Agent may waive
payment of the fee required under Section 12.3.2 without obtaining the consent
of any other party to this Agreement.
8.3 PRESERVATION OF RIGHTS. No delay or omission of the Lenders, the LC
Issuer or the Agent to exercise any right under the Loan Documents shall impair
such right or be construed to be a waiver of any Default or an acquiescence
therein, and the making of a Credit Extension notwithstanding the existence of a
Default or the inability of any Borrower to satisfy the conditions precedent to
such Credit Extension shall not constitute any waiver or acquiescence. Any
single or partial exercise of any such right shall not preclude other or further
exercise thereof or the exercise of any other right, and no waiver, amendment or
other variation of the terms, conditions or provisions of the Loan Documents
whatsoever shall be valid unless in writing signed by the Lenders required
pursuant to Section 8.2, and then only to the extent in such writing
specifically set forth. All remedies contained in the Loan Documents or by law
afforded shall be cumulative and all shall be available to the Agent, the LC
Issuer and the Lenders until the Obligations have been paid in full.
ARTICLE IX
GENERAL PROVISIONS
9.1 SURVIVAL OF REPRESENTATIONS. All representations and warranties of the
Borrowers contained in this Agreement shall survive the making of the Credit
Extensions herein contemplated.
9.2 GOVERNMENTAL REGULATION. Anything contained in this Agreement to the
contrary notwithstanding, neither the LC Issuer nor any Lender shall be
obligated to extend credit to any Borrower in violation of any limitation or
prohibition provided by any applicable statute or regulation.
53
9.3 HEADINGS. Section headings in the Loan Documents are for convenience of
reference only, and shall not govern the interpretation of any of the provisions
of the Loan Documents.
9.4 ENTIRE AGREEMENT. The Loan Documents embody the entire agreement and
understanding among the Borrowers, the Agent, the LC Issuer and the Lenders and
supersede all prior agreements and understandings among the Borrowers, the
Agent, the LC Issuer and the Lenders relating to the subject matter thereof
other than the fee letters described in Section 10.13.
9.5 SEVERAL OBLIGATIONS; BENEFITS OF THIS AGREEMENT. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Agent is authorized to act as such). The failure of any Lender to perform any of
its obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. This Agreement shall not be construed so as to confer any
right or benefit upon any Person other than the parties to this Agreement and
their respective successors and assigns, provided, however, that the parties
hereto expressly agree that the Arranger shall enjoy the benefits of the
provisions of Sections 9.6, 9.10 and 10.11 to the extent specifically set forth
therein and shall have the right to enforce such provisions on its own behalf
and in its own name to the same extent as if it were a party to this Agreement.
9.6 EXPENSES; INDEMNIFICATION. (i) The Borrowers jointly and severally
agree to reimburse the Agent and the Arranger for any reasonable costs, internal
charges and out-of-pocket expenses (including reasonable attorneys' fees and
time charges of attorneys for the Agent, which attorneys may be employees of the
Agent) paid or incurred by the Agent or the Arranger in connection with the
preparation, negotiation, execution, delivery, syndication, review, amendment,
modification, and administration of the Loan Documents. The Borrowers also
jointly and severally agree to reimburse the Agent, the Arranger, the LC Issuer
and the Lenders for any reasonable costs, internal charges and out-of-pocket
expenses (including reasonable attorneys' fees and time charges of attorneys for
the Agent, the Arranger, the LC Issuer and the Lenders, which attorneys may be
employees of the Agent, the Arranger, the LC Issuer or the Lenders) paid or
incurred by the Agent, the Arranger, the LC Issuer or any Lender in connection
with the collection and enforcement of the Loan Documents. Expenses being
reimbursed by the Borrowers under this Section include, without limitation,
costs and expenses incurred in connection with the Reports described in the
following sentence. The Borrowers acknowledge that from time to time Bank One
may prepare and may distribute to the Lenders (but shall have no obligation or
duty to prepare or to distribute to the Lenders) certain audit reports (the
"Reports") pertaining to the Borrowers' assets for internal use by Bank One from
information furnished to it by or on behalf of the Borrowers, after Bank One has
exercised its rights of inspection pursuant to this Agreement.
(ii) The Borrowers hereby further jointly and severally agree to
indemnify the Agent, the Arranger, the LC Issuer and each Lender, their
respective affiliates, and each of their directors, officers and employees
against all losses, claims, damages, penalties, judgments, liabilities and
expenses (including, without limitation, all expenses of litigation or
54
preparation therefor whether or not the Agent, the Arranger, the LC Issuer
or any Lender or any affiliate is a party thereto) which any of them may
pay or incur arising out of or relating to this Agreement, the other Loan
Documents, the transactions contemplated hereby or the direct or indirect
application or proposed application of the proceeds of any Credit Extension
hereunder except to the extent that they are determined in a final
non-appealable judgment by a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of the party
seeking indemnification. The obligations of the Borrowers under this
Section 9.6 shall survive the termination of this Agreement.
(iii) The Borrowers acknowledge and agree that, promptly after the
Effective Date, the Agent (or counsel for the Agent), on behalf of the
Lenders, will enter into an engagement letter with BDO Xxxxxxx, or, if BDO
Xxxxxxx declines such engagement, another consultant satisfactory to the
Agent (in either case, the "Consultant"), pursuant to which the Agent will
direct the Consultant to deliver a completed report to the Lenders, no
later than October 31, 2001, with respect to the following aspects of the
Borrowers' operations: (i) procedures for accumulating field production
data; (ii) procedures for reporting field production data into internal
accounting systems; (iii) procedures for documenting the scope of work
changes in the field and change order requests; and (iv) benchmarking of
the Borrowers' procedures for reporting field production data with the
standards and best practices in the industry, all in form and substance
satisfactory to the Agent. The Borrowers hereby jointly and severally agree
(a) to provide the Consultant with access to management and information on
a basis sufficient to enable the Consultant to complete its engagement in
accordance with its terms and (b) to pay or reimburse the Consultant's
reasonable fees and expenses in connection with such engagement.
9.7 NUMBERS OF DOCUMENTS. All statements, notices, closing documents, and
requests hereunder shall be furnished to the Agent with sufficient counterparts
so that the Agent may furnish one to each of the Lenders.
9.8 ACCOUNTING. Except as provided to the contrary herein, all accounting
terms used herein shall be interpreted and all accounting determinations
hereunder shall be made in accordance with Agreement Accounting Principles.
9.9 SEVERABILITY OF PROVISIONS. Any provision in any Loan Document that is
held to be inoperative, unenforceable, or invalid in any jurisdiction shall, as
to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
9.10 NONLIABILITY OF LENDERS. The relationship between the Borrowers on the
one hand and the Lenders, the LC Issuer and the Agent on the other hand shall be
solely that of borrower and lender. Neither the Agent, the Arranger, the LC
Issuer nor any Lender shall have any fiduciary responsibilities to any Borrower.
Neither the Agent, the Arranger, the LC Issuer nor any Lender undertakes any
responsibility to any Borrower to review or inform such Borrower of any matter
in connection with any phase of such Borrower's business or operations. Each
Borrower agrees that neither the Agent, the Arranger, the LC Issuer nor any
Lender shall have liability to such Borrower (whether sounding in tort, contract
or otherwise) for losses suffered by such Borrower in connection with, arising
55
out of, or in any way related to, the transactions contemplated and the
relationship established by the Loan Documents, or any act, omission or event
occurring in connection therewith, unless it is determined in a final
non-appealable judgment by a court of competent jurisdiction that such losses
resulted from the gross negligence or willful misconduct of the party from which
recovery is sought. Neither the Agent, the Arranger, the LC Issuer nor any
Lender shall have any liability with respect to, and each Borrower hereby
waives, releases and agrees not to xxx for, any special, indirect or
consequential damages suffered by such Borrower in connection with, arising out
of, or in any way related to the Loan Documents or the transactions contemplated
thereby.
9.11 CONFIDENTIALITY. Each Lender agrees to hold any confidential
information which it may receive from the Borrowers pursuant to this Agreement
in confidence, except for disclosure (i) to its affiliates and to other Lenders
and their respective affiliates, (ii) to legal counsel, accountants, and other
professional advisors to such Lender or to a Transferee, (iii) to regulatory
officials, (iv) to any Person as requested pursuant to or as required by law,
regulation, or legal process, (v) to any Person in connection with any legal
proceeding to which such Lender is a party, (vi) to such Lender's direct or
indirect contractual counterparties in swap agreements or to legal counsel,
accountants and other professional advisors to such counterparties, and (vii)
permitted by Section 12.4.
9.12 PERFORMANCE OF OBLIGATIONS. The Borrowers agree that, after the
occurrence and during the continuance of a Default, the Agent may, but shall
have no obligation to, (i) at any time, pay or discharge taxes, liens, security
interests or other encumbrances levied or placed on or threatened against any
Collateral (other than any of the foregoing which is permitted hereunder) and
(ii) make any other payment or perform any act required of any Borrower under
any Loan Document or take any other action which the Agent in its discretion
deems necessary or desirable to protect or preserve the Collateral, including,
without limitation, any action to (y) effect any repairs or obtain any insurance
called for by the terms of any of the Loan Documents and to pay all or any part
of the premiums therefor and the costs thereof and (z) pay any rents payable by
any Borrower which are more than 30 days past due, or as to which the landlord
has given notice of termination, under any lease. The Agent shall use its
reasonable efforts to give the Borrowers five (5) Business Days' notice of any
action taken under this Section 9.12 prior to the taking of such action;
PROVIDED that the failure to give such notice shall not affect the Borrowers'
obligations in respect thereof, and PROVIDED FURTHER that the right of the Agent
to obtain any insurance required by the terms of this Agreement shall be
governed by Section 6.6(b). The Borrowers jointly and severally agree to pay to
the Agent, promptly after receipt of a reasonably detailed invoice therefor, the
principal amount of all funds advanced by the Agent under this Section 9.12,
together with interest thereon at the rate from time to time applicable to
Floating Rate Loans from the date of such advance until the outstanding
principal balance thereof is paid in full. If the Borrowers fail to make payment
in respect of any such advance under this Section 9.12 within one (1) Business
Day after the date the Borrowers receive written demand therefor from the Agent,
the Agent shall promptly notify each Lender and each Lender agrees that it shall
thereupon make available to the Agent, in immediately available funds, the
amount equal to such Lender's Pro Rata Share of such advance. If such funds are
not made available to the Agent by such Lender within one (1) Business Day after
the Agent's demand therefor, the Agent will be entitled to recover any such
amount from such Lender together with interest thereon at the Federal Funds
Effective Rate for each day during the period commencing on the date of such
demand and ending on the date such amount is received. The failure of any Lender
56
to make available to the Agent its Pro Rata Share of any such unreimbursed
advance under this Section 9.12 shall neither relieve any other Lender of its
obligation hereunder to make available to the Agent such other Lender's Pro Rata
Share of such advance on the date such payment is to be made nor increase the
obligation of any other Lender to make such payment to the Agent. All
outstanding principal of, and interest on, advances made under this Section 9.12
shall constitute Obligations secured by the Collateral until paid in full by the
Borrowers.
9.13 JOINT AND SEVERAL LIABILITY OF THE BORROWERS.
9.13.1. JOINT AND SEVERAL OBLIGATIONS. The Borrowers shall be jointly
and severally liable for the payment of the Obligations and the performance
of each and all of the covenants and agreements of the Borrowers under this
Agreement and the other Loan Documents.
9.13.2. LIMITATION ON OBLIGATIONS. (a) In any action or proceeding
involving any state corporate law, or any state, federal or foreign
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations of any Borrower under this
Agreement would otherwise be held or determined to be avoidable, invalid or
unenforceable on account of the amount of such Borrower's liability under
this Agreement, then, notwithstanding any other provision of this Agreement
to the contrary, the amount of such liability shall, without any further
action by the Borrowers, the Agent, the LC Issuer or any Lender, be
automatically limited and reduced to the highest amount that is valid and
enforceable as determined in such action or proceeding (such highest amount
determined hereunder being the relevant Borrower's "Maximum Liability").
This Section 9.13.2(a) with respect to the Maximum Liability of the
Borrowers is intended solely to preserve the rights of the Agent, the LC
Issuer and the Lenders hereunder to the maximum extent not subject to
avoidance under applicable law, and neither any Borrower nor any other
Person shall have any right or claim under this Section 9.13.2(a) with
respect to the Maximum Liability, except to the extent necessary so that
the obligations of each Borrower hereunder shall not be rendered voidable
under applicable law.
(b) Each of the Borrowers agrees that the Obligations may at any time
and from time to time exceed the Maximum Liability of such Borrower, and
may exceed the aggregate Maximum Liability of all the Borrowers, without
impairing the Borrowers' obligations hereunder or affecting the rights and
remedies of the Agent, the LC Issuer and the Lenders hereunder. Nothing in
this Section 9.13.2(b) shall be construed to increase any Borrower's
obligations hereunder beyond its Maximum Liability.
(c) In the event any Borrower (a "Paying Borrower") shall make any
payment or payments under this Agreement in excess of its own primary
obligations with respect to Loans made to it and Facility LC issued for its
account or shall suffer any loss as a result of any realization upon any
Collateral granted by it to secure its obligations under this Agreement in
excess of its own primary obligations with respect to Loans made to it and
Facility LCs issued for its account, each other Borrower (each a
"Non-Paying Borrower") shall contribute to such Paying Borrower an amount
equal to such Non-Paying Borrower's "Pro Rata Share" of such payment or
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payments made, or losses suffered, by such Paying Borrower. For the
purposes hereof, each Non-Paying Borrower's "Pro Rata Share" with respect
to any such payment or loss by a Paying Borrower shall be determined as of
the date on which such payment or loss was made by reference to the ratio
of (i) such Non-Paying Borrower's Maximum Liability as of such date
(without giving effect to any right to receive, or obligation to make, any
contribution hereunder) to (ii) the aggregate Maximum Liability of all
Borrowers hereunder (including such Paying Borrower) as of such date
(without giving effect to any right to receive, or obligation to make, any
contribution hereunder). Nothing in this Section 9.13.2(c) shall affect any
Borrower's several liability for the entire amount of the Obligations (up
to such Borrower's Maximum Liability). Each of the Borrowers covenants and
agrees that its right to receive any contribution under this Section
9.13.2(c) from a Non-Paying Borrower shall be subordinate and junior in
right of payment to all the Obligations. The provisions of this Section
9.13.2(c) are for the benefit of all of the parties to this Agreement and
may be enforced by or on behalf of any one, or more, or all of them in
accordance with the terms hereof.
9.13.3. OBLIGATIONS UNCONDITIONAL. Subject to Section 9.13.2, the
obligations of each of the Borrowers hereunder shall be unconditional and
absolute and, without limiting the generality of the foregoing, shall not
be released, discharged or otherwise affected by:
(i) any extension, renewal, settlement, compromise, waiver or release
in respect of any of the Obligations, by operation of law or otherwise, or
any obligation of any other guarantor of any of the Obligations, or any
default, failure or delay, willful or otherwise, in the payment or
performance of the Obligations;
(ii) any modification or amendment of or supplement to this Agreement,
any Note, any Rate Management Transaction or any other Loan Document;
(iii) any release, nonperfection or invalidity of any direct or
indirect security for any Obligations under this Agreement, any Note, any
Rate Management Transaction, any other Loan Document, or any obligations of
any other guarantor of any of the Obligations, or any action or failure to
act by the Agent, the LC Issuer, any Lender or any affiliate of any Lender
with respect to any Collateral securing all or any part of the Obligations;
(iv) any change in the corporate existence, structure or ownership of
the Company or any other Borrower or any other guarantor of any of the
Obligations, or any insolvency, bankruptcy, reorganization or other similar
proceeding affecting the Company or any other Borrower or any other
guarantor of the Obligations, or its assets, or any resulting release or
discharge of any obligation of the Company or any other Borrower or any
other guarantor of any of the Obligations;
(v) the existence of any claim, setoff or other rights which any
Borrower may have at any time against the Company or any other Borrower or
any other guarantor of any of the Obligations, the Agent, the LC Issuer,
any Lender or any other Person, whether in connection herewith or any
unrelated transactions;
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(vi) any invalidity or unenforceability relating to or against the
Company or any other Borrower or any other guarantor of any of the
Obligations, for any reason related to this Agreement, any Rate Management
Transaction, any other Loan Document, or any provision of applicable law or
regulation purporting to prohibit the payment, by the Company or any other
Borrower or any other guarantor of the Obligations, of the principal of or
interest on any Note or any other amount payable by the Company or any
other Borrower under this Agreement, any Note, any Rate Management
Transaction or any other Loan Document; or
(vii) any other act or omission to act or delay of any kind by the
Company or any other Borrower or any other guarantor of the Obligations,
the Agent, the LC Issuer, any Lender or any other Person, or any other
circumstance whatsoever which might, but for the provisions of this Section
9.13.3, constitute a legal or equitable discharge of any Borrower's
obligations hereunder.
Each of the Borrowers hereby fully and completely waives, releases and
relinquishes any and all defenses and claims based on principles of suretyship
and/or guaranty and any and all benefits under Arizona Revised Statutes Sections
12-1641 through 12-1646 and Rule 17(f) of the Arizona Rules of Civil Procedure.
9.14 NO NOVATION. Notwithstanding anything herein to the contrary, it is
the intention of the parties hereto that the execution and delivery of this
Agreement not effect a novation, payment, discharge, or extinguishment of the
Original Agreement, but merely a restatement and substitution of the terms
thereof.
ARTICLE X
THE AGENT
10.1 APPOINTMENT; NATURE OF RELATIONSHIP. Bank One, Arizona, NA is hereby
appointed by each of the Lenders as its contractual representative (herein
referred to as the "Agent") hereunder and under each other Loan Document, and
each of the Lenders irrevocably authorizes the Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents. The Agent agrees to act as such
contractual representative upon the express conditions contained in this Article
X. Notwithstanding the use of the defined term "Agent," it is expressly
understood and agreed that the Agent shall not have any fiduciary
responsibilities to any Lender by reason of this Agreement or any other Loan
Document and that the Agent is merely acting as the contractual representative
of the Lenders with only those duties as are expressly set forth in this
Agreement and the other Loan Documents. In its capacity as the Lenders'
contractual representative, the Agent (i) does not hereby assume any fiduciary
duties to any of the Lenders, (ii) is a "representative" of the Lenders within
the meaning of Section 9-105 of the Uniform Commercial Code and (iii) is acting
as an independent contractor, the rights and duties of which are limited to
those expressly set forth in this Agreement and the other Loan Documents. Each
of the Lenders hereby agrees to assert no claim against the Agent on any agency
theory or any other theory of liability for breach of fiduciary duty, all of
which claims each Lender hereby waives.
10.2 POWERS. The Agent shall have and may exercise such powers under the
Loan Documents as are specifically delegated to the Agent by the terms of each
thereof, together with such powers as are reasonably incidental thereto. The
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Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.
10.3 GENERAL IMMUNITY. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to any Borrower, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith except
to the extent such action or inaction is determined in a final non-appealable
judgment by a court of competent jurisdiction to have arisen from the gross
negligence or willful misconduct of such Person.
10.4 NO RESPONSIBILITY FOR LOANS, RECITALS, ETC. Neither the Agent nor any
of its directors, officers, agents or employees shall be responsible for or have
any duty to ascertain, inquire into, or verify (a) any statement, warranty or
representation made in connection with any Loan Document or any borrowing
hereunder; (b) the performance or observance of any of the covenants or
agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender; (c) the satisfaction of any condition specified in Article IV, except
receipt of items required to be delivered solely to the Agent; (d) the existence
or possible existence of any Default or Unmatured Default; (e) the validity,
enforceability, effectiveness, sufficiency or genuineness of any Loan Document
or any other instrument or writing furnished in connection therewith; (f) the
value, sufficiency, creation, perfection or priority of any Lien in any
collateral security; or (g) the financial condition of any Borrower or any
guarantor of any of the Obligations or of any Borrower's or any such guarantor's
respective Subsidiaries. The Agent shall have no duty to disclose to the Lenders
information that is not required to be furnished by the Company or any Borrower
to the Agent at such time, but is voluntarily furnished by the Company or any
Borrower to the Agent (either in its capacity as Agent or in its individual
capacity).
10.5 ACTION ON INSTRUCTIONS OF LENDERS. The Agent shall in all cases be
fully protected in acting, or in refraining from acting, hereunder and under any
other Loan Document in accordance with written instructions signed by the
Required Lenders, and such instructions and any action taken or failure to act
pursuant thereto shall be binding on all of the Lenders. The Lenders hereby
acknowledge that the Agent shall be under no duty to take any discretionary
action permitted to be taken by it pursuant to the provisions of this Agreement
or any other Loan Document unless it shall be requested in writing to do so by
the Required Lenders. The Agent shall be fully justified in failing or refusing
to take any action hereunder and under any other Loan Document unless it shall
first be indemnified to its satisfaction by the Lenders pro rata against any and
all liability, cost and expense that it may incur by reason of taking or
continuing to take any such action.
10.6 EMPLOYMENT OF AGENTS AND COUNSEL. The Agent may execute any of its
duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Agent and the Lenders
and all matters pertaining to the Agent's duties hereunder and under any other
Loan Document.
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10.7 RELIANCE ON DOCUMENTS; COUNSEL. The Agent shall be entitled to rely
upon any Note, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Agent, which counsel
may be employees of the Agent.
10.8 AGENT'S REIMBURSEMENT AND INDEMNIFICATION. The Lenders agree to
reimburse and indemnify the Agent ratably in proportion to their respective Pro
Rata Shares (i) for any amounts not reimbursed by the Borrowers for which the
Agent is entitled to reimbursement by the Borrowers under the Loan Documents,
(ii) for any other expenses incurred by the Agent on behalf of the Lenders, in
connection with the preparation, execution, delivery, administration and
enforcement of the Loan Documents (including, without limitation, for any
expenses incurred by the Agent in connection with any dispute between the Agent
and any Lender or between two or more of the Lenders) and (iii) for any
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind and nature whatsoever which may be
imposed on, incurred by or asserted against the Agent in any way relating to or
arising out of the Loan Documents or any other document delivered in connection
therewith or the transactions contemplated thereby (including, without
limitation, for any such amounts incurred by or asserted against the Agent in
connection with any dispute between the Agent and any Lender or between two or
more of the Lenders), or the enforcement of any of the terms of the Loan
Documents or of any such other documents, PROVIDED that (i) no Lender shall be
liable for any of the foregoing to the extent any of the foregoing is found in a
final non-appealable judgment by a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of the Agent and (ii)
any indemnification required pursuant to Section 3.5(vii) shall, notwithstanding
the provisions of this Section 10.8, be paid by the relevant Lender in
accordance with the provisions thereof. The obligations of the Lenders under
this Section 10.8 shall survive payment of the Obligations and termination of
this Agreement.
10.9 NOTICE OF DEFAULT. The Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Unmatured Default hereunder unless
the Agent has received written notice from a Lender or any Borrower referring to
this Agreement describing such Default or Unmatured Default and stating that
such notice is a "notice of default". In the event that the Agent receives such
a notice, the Agent shall give prompt notice thereof to the Lenders.
10.10 RIGHTS AS A LENDER. In the event the Agent is a Lender, the Agent
shall have the same rights and powers hereunder and under any other Loan
Document with respect to its Commitment and its Loans as any Lender and may
exercise the same as though it were not the Agent, and the term "Lender" or
"Lenders" shall, at any time when the Agent is a Lender, unless the context
otherwise indicates, include the Agent in its individual capacity. The Agent and
its affiliates may accept deposits from, lend money to, and generally engage in
any kind of trust, debt, equity or other transaction, in addition to those
contemplated by this Agreement or any other Loan Document, with the Company or
any of its Subsidiaries in which the Company or such Subsidiary is not
restricted hereby from engaging with any other Person. The Agent, in its
individual capacity, is not obligated to remain a Lender.
10.11 LENDER CREDIT DECISION. Each Lender acknowledges that it has,
independently and without reliance upon the Agent, the Arranger or any other
Lender and based on the financial statements prepared by the Company and such
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other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent, the Arranger 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 and the other Loan Documents.
10.12 SUCCESSOR AGENT. The Agent may resign at any time by giving written
notice thereof to the Lenders and the Company, such resignation to be effective
upon the appointment of a successor Agent or, if no successor Agent has been
appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. The Agent may be removed at any time with or without cause
by written notice received by the Agent from the Required Lenders, such removal
to be effective on the date specified by the Required Lenders. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint, on
behalf of the Lenders, a successor Agent. If no successor Agent shall have been
so appointed by the Required Lenders within thirty days after the resigning
Agent's giving notice of its intention to resign, then the resigning Agent may
appoint, on behalf of the Lenders, a successor Agent. Notwithstanding the
previous sentence, the Agent may at any time without the consent of the
Borrowers or any Lender, appoint any of its affiliates which is a commercial
bank as a successor Agent hereunder. If the Agent has resigned or been removed
and no successor Agent has been appointed, the Lenders may perform all the
duties of the Agent hereunder and the Borrowers shall make all payments in
respect of the Obligations to the applicable Lender and for all other purposes
shall deal directly with the Lenders. No successor Agent shall be deemed to be
appointed hereunder until such successor Agent has accepted the appointment. Any
such successor Agent shall be a commercial bank having capital and retained
earnings of at least $100,000,000. Upon the acceptance of any appointment as
Agent hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the resigning or removed Agent. Upon the effectiveness of the resignation or
removal of the Agent, the resigning or removed Agent shall be discharged from
its duties and obligations hereunder and under the Loan Documents. After the
effectiveness of the resignation or removal of an Agent, the provisions of this
Article X shall continue in effect for the benefit of such Agent in respect of
any actions taken or omitted to be taken by it while it was acting as the Agent
hereunder and under the other Loan Documents. In the event that there is a
successor to the Agent by merger, or the Agent assigns its duties and
obligations to an affiliate pursuant to this Section 10.12, then the term "Prime
Rate" as used in this Agreement shall mean the prime rate, base rate or other
analogous rate of the new Agent.
10.13 AGENT'S FEE. The Borrowers jointly and severally agree to pay to the
Agent, for its own account, the fees agreed to by the Company and the Agent
pursuant to those certain letter agreements dated February 9, 2000 and June 14,
2001, or as otherwise agreed from time to time.
10.14 DELEGATION TO AFFILIATES. The Borrowers and the Lenders agree that
the Agent may delegate any of its duties under this Agreement to any of its
affiliates. Any such affiliate (and such affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Agent is entitled under Articles IX and X.
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10.15 EXECUTION OF COLLATERAL DOCUMENTS. The Lenders hereby empower and
authorize the Agent to execute and deliver to the Borrowers on their behalf any
Collateral Documents and all related financing statements and any financing
statements, agreements, documents or instruments as shall be necessary or
appropriate to effect the purposes of the Collateral Documents.
10.16 COLLATERAL RELEASES. The Lenders hereby empower and authorize the
Agent to execute and deliver to the Borrowers on their behalf any agreements,
documents or instruments as shall be necessary or appropriate to effect any
releases of Collateral which shall be permitted by the terms hereof or of any
other Loan Document or which shall otherwise have been approved by the Required
Lenders (or, if required by the terms of Section 8.2, all of the Lenders) in
writing.
10.17 CO-AGENTS, SYNDICATION AGENT, ETC. Neither any of the Lenders
identified in this Agreement as a "co-agent" nor the Syndication Agent shall
have any right, power, obligation, liability, responsibility or duty under this
Agreement other than those applicable to all Lenders as such. Without limiting
the foregoing, none of such Lenders shall have or be deemed to have a fiduciary
relationship with any Lender. Each Lender hereby makes the same acknowledgments
with respect to such Lenders as it makes with respect to the Agent in Section
10.11.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
11.1 SETOFF. In addition to, and without limitation of, any rights of the
Lenders under applicable law, if any Borrower becomes insolvent, however
evidenced, or any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender or
any affiliate of any Lender to or for the credit or account of such Borrower may
be offset and applied toward the payment of the Secured Obligations owing to
such Lender, whether or not the Secured Obligations, or any part thereof, shall
then be due.
11.2 RATABLE PAYMENTS. If any Lender, whether by setoff or otherwise, has
payment made to it upon its Outstanding Credit Exposure (other than payments
received pursuant to Section 3.1, 3.2, 3.4 or 3.5) in a greater proportion than
that received by any other Lender, such Lender agrees, promptly upon demand, to
purchase a portion of the Aggregate Outstanding Credit Exposure held by the
other Lenders so that after such purchase each Lender will hold its Pro Rata
Share of the Aggregate Outstanding Credit Exposure. If any Lender, whether in
connection with setoff or amounts which might be subject to setoff or otherwise,
receives collateral or other protection for its Obligations or such amounts
which may be subject to setoff, such Lender agrees, promptly upon demand, to
take such action necessary such that all Lenders share in the benefits of such
collateral ratably in proportion to their respective Pro Rata Shares of the
Aggregate Outstanding Credit Exposure. In case any such payment is disturbed by
legal process, or otherwise, appropriate further adjustments shall be made.
11.3 APPLICATION OF PAYMENTS. So long as a Default shall have occurred and
be continuing, or if the Borrowers shall otherwise fail to direct the
application of payments hereunder, the Agent shall, unless otherwise specified
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at the direction of the Required Lenders, which direction shall be consistent
with the last two sentences of this Section 11.3, apply all payments and
prepayments in respect of any Obligations and all proceeds of Collateral in the
following order:
(A) first, to pay interest on and then principal of any portion of the
Loans which the Agent may have advanced on behalf of any Lender for which
the Agent has not then been reimbursed by such Lender or the Borrowers;
(B) second, to pay interest on and then principal of any advance made
under Section 9.12 for which the Agent has not then been paid by the
Borrowers or reimbursed by the Lenders;
(C) third, to pay Obligations in respect of any fees, expenses,
reimbursements or indemnities then due to the Agent;
(D) fourth, to pay Obligations in respect of any fees, expenses,
reimbursements or indemnities then due to the Lenders and the LC Issuer;
(E) fifth, to pay interest due in respect of Swing Line Loans;
(F) sixth, to pay interest due in respect of the Loans (other than
Swing Line Loans) and Reimbursement Obligations;
(G) seventh, to the ratable payment or prepayment of principal
outstanding on Swing Line Loans;
(H) eighth, to the ratable payment or prepayment of principal
outstanding on Loans, Reimbursement Obligations and Rate Management
Obligations owing to any Lender or any affiliate of any Lender;
(I) ninth, to provide required cash collateral pursuant to Section
8.1; and
(J) tenth, to the ratable payment of all other Obligations.
Unless otherwise designated (which designation shall only be applicable prior to
the occurrence of a Default) by the Borrowers, all principal payments in respect
of Revolving Loans shall be applied first to repay outstanding Floating Rate
Loans and then to repay outstanding Eurodollar Rate Loans, with those Eurodollar
Rate Loans which have earlier expiring Interest Periods being repaid prior to
those which have later expiring Interest Periods. The order of priority set
forth in this Section 11.3 and the related provisions of this Agreement are set
forth solely to determine the rights and priorities of the Agent, the Lenders,
the LC Issuer and other Holders of Secured Obligations as among themselves. The
order of priority set forth in clauses (D) through (J) of this Section 11.3 may
at any time and from time to time be changed by the Required Lenders without
necessity of notice to or consent of or approval by the Borrowers, or any other
Person, provided that the order of priority of payments in respect of Swing Line
Loans may be changed only with the prior written consent of the Swing Line
Lender. The order of priority set forth in clauses (A) through (C) of this
Section 11.3 may be changed only with the prior written consent of the Agent.
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11.4 RELATIONS AMONG LENDERS. Except with respect to the exercise of set-off
rights of any Lender in accordance with Section 11.1, the proceeds of which are
applied in accordance with this Agreement, and except as set forth in the
following sentence, each Lender agrees that it will not take any action, nor
institute any actions or proceedings, against any Borrower or any other obligor
hereunder or with respect to any Collateral or Loan Document, without the prior
written consent of the Required Lenders or, as may be provided in this Agreement
or the other Loan Documents, at the direction of the Agent. Notwithstanding the
foregoing, and subject to Section 11.2, any Lender shall have the right to
enforce on an unsecured basis the payment of the principal of and interest on
any Loan made by it after the date such principal or interest has become due and
payable pursuant to the terms of this Agreement.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1 SUCCESSORS AND ASSIGNS. The terms and provisions of the Loan Documents
shall be binding upon and inure to the benefit of the Borrowers and the Lenders
and their respective successors and assigns, except that (i) no Borrower shall
have the right to assign its rights or obligations under the Loan Documents and
(ii) any assignment by any Lender must be made in compliance with Section 12.3.
The parties to this Agreement acknowledge that clause (ii) of this Section 12.1
relates only to absolute assignments and does not prohibit assignments creating
security interests, including, without limitation, any pledge or assignment by
any Lender of all or any portion of its rights under this Agreement and any Note
to a Federal Reserve Bank; provided, however, that no such pledge or assignment
creating a security interest shall release the transferor Lender from its
obligations hereunder unless and until the parties thereto have complied with
the provisions of Section 12.3. The Agent may treat the Person which made any
Loan or which holds any Note as the owner thereof for all purposes hereof unless
and until such Person complies with Section 12.3; provided, however, that the
Agent may in its discretion (but shall not be required to) follow instructions
from the Person which made any Loan or which holds any Note to direct payments
relating to such Loan or Note to another Person. Any assignee of the rights to
any Loan or any Note agrees by acceptance of such assignment to be bound by all
the terms and provisions of the Loan Documents. Any request, authority or
consent of any Person, who at the time of making such request or giving such
authority or consent is the owner of the rights to any Loan (whether or not a
Note has been issued in evidence thereof), shall be conclusive and binding on
any subsequent holder or assignee of the rights to such Loan.
12.2 PARTICIPATIONS.
12.2.1. PERMITTED PARTICIPANTS; EFFECT. Any Lender may, in the
ordinary course of its business and in accordance with applicable law, at
any time sell to one or more banks or other entities ("Participants")
participating interests in any Outstanding Credit Exposure of such Lender,
any Note held by such Lender, any Commitment of such Lender or any other
interest of such Lender under the Loan Documents. In the event of any such
sale by a Lender of participating interests to a Participant, such Lender's
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obligations under the Loan Documents shall remain unchanged, such Lender
shall remain solely responsible to the other parties hereto for the
performance of such obligations, such Lender shall remain the owner of its
Outstanding Credit Exposure and the holder of any Note issued to it in
evidence thereof for all purposes under the Loan Documents, all amounts
payable by the Borrowers under this Agreement shall be determined as if
such Lender had not sold such participating interests, and the Borrowers
and the Agent shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations under the Loan
Documents.
12.2.2. VOTING RIGHTS. Each Lender shall retain the sole right to
approve, without the consent of any Participant, any amendment,
modification or waiver of any provision of the Loan Documents other than
any amendment, modification or waiver with respect to any Credit Extension
or Commitment in which such Participant has an interest which forgives
principal, interest, fees or any Reimbursement Obligation or reduces the
interest rate or fees payable with respect to any such Credit Extension or
Commitment, extends the Facility Termination Date, postpones any date fixed
for any regularly-scheduled payment of principal of or interest on, any
Loan in which such Participant has an interest, or any regularly scheduled
payment of fees on any such Credit Extension or Commitment, releases any
guarantor of any such Credit Extension or releases any collateral held in
the Facility LC Collateral Account (except in accordance with the terms
hereof) or all or substantially all of any other Collateral securing any
such Credit Extension.
12.2.3. BENEFIT OF SETOFF. Each Borrower agrees that each Participant
shall be deemed to have the right of setoff provided in Section 11.1 in
respect of its participating interest in amounts owing under the Loan
Documents to the same extent as if the amount of its participating interest
were owing directly to it as a Lender under the Loan Documents, PROVIDED
that each Lender shall retain the right of setoff provided in Section 11.1
with respect to the amount of participating interests sold to each
Participant. The Lenders agree to share with each Participant, and each
Participant, by exercising the right of setoff provided in Section 11.1,
agrees to share with each Lender, any amount received pursuant to the
exercise of its right of setoff, such amounts to be shared in accordance
with Section 11.2 as if each Participant were a Lender.
12.3 ASSIGNMENTS.
12.3.1. PERMITTED ASSIGNMENTS. Any Lender may, in the ordinary course
of its business and in accordance with applicable law, at any time assign
to one or more banks or other entities ("Purchasers") all or any part of
its rights and obligations under the Loan Documents. Such assignment shall
be substantially in the form of Exhibit C or in such other form as may be
agreed to by the parties thereto. The consent of the Company, the Agent and
the LC Issuer shall be required prior to an assignment becoming effective
with respect to a Purchaser which is not a Lender or an affiliate thereof;
PROVIDED, HOWEVER, that if a Default has occurred and is continuing, the
consent of the Company shall not be required. Such consent shall not be
unreasonably withheld or delayed. Each such assignment with respect to a
Purchaser which is not a Lender or an affiliate thereof shall (unless each
of the Company and the Agent otherwise consents) be in an amount not less
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than the lesser of (i) $5,000,000 or (ii) the remaining amount of the
assigning Lender's Commitment (calculated as at the date of such
assignment) or outstanding Loans (if the applicable Commitment has been
terminated).
12.3.2. EFFECT; EFFECTIVE DATE. Upon (i) delivery to the Agent of an
assignment, together with any consents required by Section 12.3.1, and (ii)
payment of a $3,500 fee to the Agent for processing such assignment (unless
such fee is waived by the Agent), such assignment shall become effective on
the effective date specified in such assignment. The assignment shall
contain a representation by the Purchaser to the effect that none of the
consideration used to make the purchase of the Commitment and Outstanding
Credit Exposure under the applicable assignment agreement constitutes "plan
assets" as defined under ERISA and that the rights and interests of the
Purchaser in and under the Loan Documents will not be "plan assets" under
ERISA. On and after the effective date of such assignment, such Purchaser
shall for all purposes be a Lender party to this Agreement and any other
Loan Document executed by or on behalf of the Lenders and shall have all
the rights and obligations of a Lender under the Loan Documents, to the
same extent as if it were an original party hereto, and no further consent
or action by any Borrower, the Lenders or the Agent shall be required to
release the transferor Lender with respect to the percentage of the
Aggregate Commitment and Outstanding Credit Exposure assigned to such
Purchaser. Upon the consummation of any assignment to a Purchaser pursuant
to this Section 12.3.2, the transferor Lender, the Agent and the Borrowers
shall, if the transferor Lender or the Purchaser desires that its Loans be
evidenced by Notes, make appropriate arrangements so that new Notes or, as
appropriate, replacement Notes are issued to such transferor Lender and new
Notes or, as appropriate, replacement Notes, are issued to such Purchaser,
in each case in principal amounts reflecting their respective Commitments,
as adjusted pursuant to such assignment.
12.4 DISSEMINATION OF INFORMATION. Each Borrower authorizes each Lender to
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "Transferee") and any
prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Company and its Subsidiaries, including
without limitation any information contained in any Reports; PROVIDED that each
Transferee and prospective Transferee agrees to be bound by Section 9.11 of this
Agreement.
12.5 TAX TREATMENT. If any interest in any Loan Document is transferred to
any Transferee which is organized under the laws of any jurisdiction other than
the United States or any State thereof, the transferor Lender shall cause such
Transferee, concurrently with the effectiveness of such transfer, to comply with
the provisions of Section 3.5(iv).
ARTICLE XIII
NOTICES
13.1 NOTICES. Except as otherwise permitted by Section 2.14 with respect to
borrowing notices, all notices, requests and other communications to any party
hereunder shall be in writing (including electronic transmission, facsimile
transmission or similar writing) and shall be given to such party: (a) in the
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case of any Borrower, at the address or facsimile number of the Company set
forth on the signature pages hereof, (b) in the case of the Agent, at its
address or facsimile number set forth below its signature hereto, (c) in the
case of any Lender, at its address or facsimile number set forth in its
administrative questionnaire or (d) in the case of any party, at such other
address or facsimile number as such party may hereafter specify for the purpose
by notice to the Agent and the Borrowers in accordance with the provisions of
this Section 13.1. Each such notice, request or other communication shall be
effective (i) if given by facsimile transmission, when transmitted to the
facsimile number specified in this Section and confirmation of receipt is
received, (ii) if given by mail, 72 hours after such communication is deposited
in the mails with first class postage prepaid, addressed as aforesaid, or (iii)
if given by any other means, when delivered (or, in the case of electronic
transmission, received) at the address specified in this Section; provided that
notices to the Agent under Article II shall not be effective until received.
13.2 CHANGE OF ADDRESS. The Borrowers and the Agent may each change the address
for service of notice upon it by a notice in writing to the other parties
hereto. Any Lender may change the address for service of notice upon it by a
notice in writing to the Borrowers and the Agent.
ARTICLE XIV
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one agreement, and any of the parties hereto may
execute this Agreement by signing any such counterpart. This Agreement shall be
effective when it has been executed by the Borrowers, the Agent, the LC Issuer
and the Lenders and each party has notified the Agent by facsimile transmission
or telephone that it has taken such action.
ARTICLE XV
CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL
15.1 CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS (WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE
STATE OF ARIZONA, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL
BANKS.
15.2 CONSENT TO JURISDICTION. EACH BORROWER HEREBY IRREVOCABLY SUBMITS TO
THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ARIZONA STATE
COURT SITTING IN MARICOPA COUNTY, ARIZONA IN ANY ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO ANY LOAN DOCUMENTS, AND EACH BORROWER HEREBY IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR
HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN
SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL
LIMIT THE RIGHT OF THE AGENT, THE LC ISSUER OR ANY LENDER TO BRING PROCEEDINGS
AGAINST ANY BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.
15.3 WAIVER OF JURY TRIAL. EACH BORROWER, THE AGENT, THE LC ISSUER AND EACH
LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY
OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN
ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.
[Signature Pages Follow]
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PRICING SCHEDULE
LEVEL I LEVEL II LEVEL III LEVEL IV
APPLICABLE MARGIN STATUS STATUS STATUS STATUS
----------------- ------ ------ ------ ------
Eurodollar Rate 3.00% 3.25% 3.50% 3.75%
ABR 1.50% 1.75% 2.00% 2.25%
XXXXX X XXXXX XX XXXXX XXX XXXXX XX
APPLICABLE MARGIN STATUS STATUS STATUS STATUS
----------------- ------ ------ ------ ------
Letter of Credit Fee 2.75% 3.00% 3.25% 3.50%
Commitment Fee 0.375% 0.375% 0.50% 0.50%
For the purposes of this Schedule, the following terms have the following
meanings, subject to the final paragraph of this Schedule:
"Financials" means the annual or quarterly financial statements of the
Company delivered pursuant to Section 6.1(i) or (ii).
"Level I Status" exists at any date if, as of the last day of the fiscal
quarter of the Company referred to in the most recent Financials, the Leverage
Ratio is less than 1.50 to 1.00.
"Level II Status" exists at any date if, as of the last day of the fiscal
quarter of the Company referred to in the most recent Financials, (i) the
Company has not qualified for Level I Status and (ii) the Leverage Ratio is less
than 2.00 to 1.00.
"Level III Status" exists at any date if, as of the last day of the fiscal
quarter of the Company referred to in the most recent Financials, (i) the
Company has not qualified for Level I Status or Level II Status and (ii) the
Leverage Ratio is less than 2.50 to 1.00.
"Level IV Status" exists at any date if the Company has not qualified for
Level I Status, Level II Status or Level III Status.
"Status" means Level I Status, Level II Status, Level III Status or Level
IV Status.
The Applicable Margin and Applicable Fee Rate shall be determined in
accordance with the foregoing table based on the Company's Status as reflected
in the then most recent Financials. Adjustments, if any, to the Applicable
Margin or Applicable Fee Rate shall be effective five business days after the
Agent has received the applicable Financials. If the Company fails to deliver
the Financials to the Agent at the time required pursuant to the Credit
Agreement, then the Applicable Margin and Applicable Fee Rate shall be the
highest Applicable Margin and Applicable Fee Rate set forth in the foregoing
table until five days after such Financials are so delivered. The Company's
Status will be deemed to be Level IV Status for the first six months after the
date hereof.
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COMMITMENT SCHEDULE
LENDER COMMITMENT
------ --------------
Bank One, Arizona, NA $27,500,000.00
Union Bank of California, N.A. $20,000,000.00
The Bank of Nova Scotia $15,000,000.00
Sun Trust Bank $15,000,000.00
First Tennessee Bank National Association $12,500,000.00
Comerica West Incorporated $10,000,000.00
--------------
Total $100,000,000.00
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