Exhibit 10.56
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DEBTOR-IN-POSSESSION TRANSIT REVOLVING CREDIT AGREEMENT
Dated as of October 5, 2001
among
RAILWORKS CORPORATION,
a Debtor and Debtor-in-Possession
as Borrower,
CERTAIN SUBSIDIARIES OF THE BORROWER,
as Debtors and Debtors-in-Possession,
as Guarantors,
THE LENDERS PARTY HERETO,
and
CSFB GLOBAL OPPORTUNITIES ADVISERS, LLC,
as Administrative Agent
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TABLE OF CONTENTS
PAGE
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ARTICLE I DEFINITIONS.............................................................................................2
Section 1.01 Definitions............................................................................2
Section 1.02 Computation of Time Periods...........................................................14
Section 1.03 Accounting Terms; Certain Calculations................................................14
Section 1.04 Certain Terms.........................................................................15
ARTICLE II THE LOANS.............................................................................................15
Section 2.01 Loans.................................................................................15
Section 2.02 Method of Borrowing...................................................................15
Section 2.03 Funding of Borrowings.................................................................15
Section 2.04 Repayment.............................................................................16
Section 2.05 Prepayments...........................................................................17
Section 2.06 Notes.................................................................................17
Section 2.07 Reduction and Expiration of Commitments...............................................18
Section 2.08 Fees..................................................................................18
Section 2.09 Interest..............................................................................18
Section 2.10 Capital Adequacy......................................................................18
Section 2.11 Increased Costs.......................................................................19
Section 2.12 Payments and Computations.............................................................19
Section 2.13 Taxes.................................................................................20
Section 2.14 Sharing of Payments, Etc..............................................................21
ARTICLE III CONDITIONS...........................................................................................21
Section 3.01 Conditions Precedent to Initial Loans.................................................21
Section 3.02 Conditions Precedent to Each Loan.....................................................23
ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................................24
Section 4.01 Financial Condition...................................................................25
Section 4.02 No Changes or Restricted Payments.....................................................25
Section 4.03 Organization; Existence; Compliance with Law..........................................25
Section 4.04 Power; Authorization; Enforceable Obligations.........................................26
Section 4.05 [Reserved.]...........................................................................26
Section 4.06 No Material Litigation................................................................26
Section 4.07 No Default............................................................................26
Section 4.08 Ownership of Property; Liens..........................................................26
Section 4.09 Intellectual Property.................................................................27
Section 4.10 No Burdensome Restrictions............................................................27
Section 4.11 Taxes.................................................................................27
Section 4.12 ERISA.................................................................................27
Section 4.13 Governmental Regulations, Etc.........................................................28
Section 4.14 Subsidiaries and Guarantors...........................................................29
Section 4.15 Use of Proceeds.......................................................................29
Section 4.16 Environmental Matters.................................................................30
Section 4.17 Disclosure............................................................................31
Section 4.18 Bank Accounts.........................................................................31
Section 4.19 Insurance.............................................................................32
Section 4.20 Labor Matters.........................................................................32
ARTICLE V AFFIRMATIVE COVENANTS..................................................................................32
Section 5.01 Financial Statements..................................................................33
Section 5.02 Certificates; Other Information.......................................................35
Section 5.03 Notices...............................................................................36
Section 5.04 Payment of Obligations................................................................37
Section 5.05 Conduct of Business and Maintenance of Existence......................................37
Section 5.06 Maintenance of Property; Insurance....................................................38
Section 5.07 Books and Records; Inspection of Property; Discussions................................38
Section 5.08 Environmental Laws....................................................................39
Section 5.09 Additional Guaranties and Stock Pledges...............................................39
Section 5.10 Ownership of Subsidiaries.............................................................39
Section 5.11 Application of Proceeds...............................................................40
Section 5.12 Compliance with Budgets...............................................................40
Section 5.13 Transit Payment Accounts; Payments....................................................41
Section 5.14 Payment of Taxes, Etc.................................................................41
Section 5.15 Collateral Documents..................................................................41
ARTICLE VI NEGATIVE COVENANTS....................................................................................41
Section 6.01 Indebtedness..........................................................................42
Section 6.02 Liens.................................................................................42
Section 6.03 Consolidation, Merger, Divestiture, etc...............................................43
Section 6.04 Acquisitions..........................................................................43
Section 6.05 Investments...........................................................................43
Section 6.06 Ownership of Equity Interests.........................................................43
Section 6.07 Fiscal Year...........................................................................43
Section 6.08 Restricted Payments...................................................................43
Section 6.09 Sale Leasebacks.......................................................................43
Section 6.10 No Further Negative Pledges...........................................................43
Section 6.11 Limitations on Transactions with Affiliates...........................................44
Section 6.12 Payment of Other Indebtedness.........................................................44
Section 6.13 Investment Banking and Finder's Fees..................................................44
Section 6.14 Maximum Capital Expenditures..........................................................45
Section 6.15 No Material Pleadings.................................................................45
Section 6.16 Modification of Contractual Obligations...............................................45
Section 6.17 Accounting Changes....................................................................45
ARTICLE VII EVENTS OF DEFAULT....................................................................................45
Section 7.01 Events of Default.....................................................................45
Section 7.02 Acceleration; Remedies................................................................48
ARTICLE VIII GUARANTY............................................................................................49
Section 8.01 The Guarantee.........................................................................49
Section 8.02 Obligations Unconditional.............................................................49
Section 8.03 Reinstatement.........................................................................50
Section 8.04 Certain Additional Waivers............................................................50
Section 8.05 Remedies..............................................................................50
Section 8.06 Rights of Contribution................................................................51
Section 8.07 Continuing Guarantee..................................................................51
ARTICLE IX SECURITY..............................................................................................51
Section 9.01 Priority and Liens....................................................................51
ARTICLE X THE ADMINISTRATIVE AGENT...............................................................................52
Section 10.01 Appointment...........................................................................52
Section 10.02 Delegation of Duties..................................................................53
Section 10.03 Exculpatory Provisions................................................................53
Section 10.04 Reliance On Communications............................................................53
Section 10.05 Notice of Default.....................................................................53
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Section 10.06 Non-Reliance On Administrative Agent and Other Lenders................................54
Section 10.07 Indemnification.......................................................................54
Section 10.08 Administrative Agent In Its Individual Capacity.......................................54
Section 10.09 Successor Administrative Agent........................................................55
ARTICLE XI MISCELLANEOUS.........................................................................................55
Section 11.01 Notices...............................................................................55
Section 11.02 Right of Set-Off......................................................................57
Section 11.03 Benefit of Agreement..................................................................57
Section 11.04 No Waiver; Remedies Cumulative........................................................59
Section 11.05 Payment of Expenses; Indemnification..................................................59
Section 11.06 Amendments, Waivers and Consents......................................................60
Section 11.07 Counterparts..........................................................................60
Section 11.08 Headings..............................................................................60
Section 11.09 Survival..............................................................................61
Section 11.10 Governing Law; Submission to Jurisdiction; Venue......................................61
Section 11.11 Severability..........................................................................61
Section 11.12 Entirety..............................................................................61
Section 11.13 Binding Effect; Termination...........................................................61
Section 11.14 Confidentiality.......................................................................62
Section 11.15 Source of Funds.......................................................................62
Section 11.16 Conflict..............................................................................63
Section 11.17 Limitation on Liability...............................................................63
SCHEDULES
Schedule I Commitments
Schedule II Existing Liens
Schedule III Equipment Sold
Schedule 4.02 No Changes
Schedule 4.08 Liens
Schedule 4.14(a) Subsidiaries
Schedule 4.14(b) Guarantors
Schedule 4.18 Bank Accounts
Schedule 11.01 Lenders' Addresses
EXHIBITS
Exhibit A Form of Note
Exhibit B Form of Notice of Borrowing
Exhibit C Form of Joinder Agreement
Exhibit D Form of Interim DIP Financing Order
Exhibit E Form of Compliance Certificate
Exhibit F Form of Assignment and Acceptance
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DEBTOR-IN-POSSESSION TRANSIT REVOLVING CREDIT AGREEMENT, dated as of
October 5, 2001, by and among RAILWORKS CORPORATION, a Delaware corporation, as
a debtor and debtor-in-possession under Chapter 11 of the Bankruptcy Code (as
hereinafter defined) (the "Borrower"), the lenders from time to time party
hereto (each a "Lender" and collectively, the "Lenders"), the Guarantors (as
hereinafter defined), and CSFB GLOBAL OPPORTUNITIES ADVISERS, LLC ("CSFB"), as
administrative agent (in such capacity, the "Administrative Agent"),
W I T N E S S E T H
WHEREAS, on September 20, 2001 (the "Filing Date"), the Borrower and
its Domestic Subsidiaries (as hereinafter defined) each filed a voluntary
petition for relief (collectively, the "Bankruptcy Cases") under Chapter 11 of
the Bankruptcy Code with the United States Bankruptcy Court for the District of
Maryland (Baltimore Division) (the "Bankruptcy Court"); and
WHEREAS, in connection with the filing of the Bankruptcy Cases, the
Borrower made a promissory note in favor of CSFB, as agent for one or more
financial institutions, in the aggregate principal amount of $10,000,000,
evidencing an emergency loan made in such amount by such financial institutions
to the Borrower (the "Emergency Loan"); and
WHEREAS, the Credit Parties (as hereinafter defined) continue to
operate their businesses pursuant to Sections 1107 and 1108 of the Bankruptcy
Code; and
WHEREAS, the Credit Parties have an immediate need for funds to
continue to operate their businesses and the Credit Parties have been unable to
obtain sufficient unsecured credit or to incur sufficient unsecured debt from
any other source sufficient to continue their business operations; and
WHEREAS, the Borrower has requested that the Lenders extend credit to
the Borrower through a post-petition financing facility in an aggregate
principal amount of up to $30,000,000; and
WHEREAS, the Credit Parties have agreed to secure their obligations
hereunder with first priority liens on and security interests in, subject to
specified exceptions, all of their respective real, personal and intangible
property (other than Excluded Assets (as hereinafter defined)), in accordance
with Sections 364(c) and 364(d) of the Bankruptcy Code; and
WHEREAS, pursuant to Section 364(c)(1) of the Bankruptcy Code, the
Credit Parties agree and acknowledge that their obligations arising hereunder
shall constitute allowed administrative expense claims in the Bankruptcy Cases,
having priority over all administrative expenses of the kind specified in
Sections 503(b) and 507(b) of the Bankruptcy Code, except the claims
specifically granted priority under the terms of this Agreement and the interim
and final orders relating thereto; and
WHEREAS, the Lenders have indicated their willingness to agree to lend
such amounts to the Borrower pursuant to Sections 364(c)(1), (2) and (3) and
Section 364(d)(1) of the Bankruptcy Code on the terms and conditions of this
Agreement; and
WHEREAS, on the date hereof, the Borrower, the guarantors from time to
time party thereto, the lenders named therein (the "Bank Lenders") and Bank of
America, N.A., as administrative agent, are entering into that certain the
Debtor-in-Possession Financing Agreement (the "TP&S Revolving Credit
Agreement"), pursuant to which, among other things, the Bank Lenders shall
provide a secured super-priority revolving credit facility to the Borrower in an
aggregate principal amount not to exceed $35,000,000, for the purposes specified
therein; and
WHEREAS, on the date hereof, the Borrower, Travelers Casualty & Surety
Company of America and certain subsidiaries of the Borrower are entering into
that certain Transit Debtor-in-Possession Bond Facility (the "Bond Credit
Agreement"), pursuant to which, among other things, Travelers (as hereinafter
defined) shall provide a facility for the issuance of surety bonds in an
aggregate principal amount of up to $100,000,000 for the purposes specified
therein; and
WHEREAS, on the date hereof, the Borrower, the lenders from time to
time party thereto (the "Bond Support Lenders"), the guarantors from time to
time party thereto, any issuer of letters of credit party thereto and CSFB, as
administrative agent, are entering into that certain Debtor-in-Possession Bond
Support Credit Agreement (the "Bond Support Credit Agreement"), pursuant to
which, among other things, the Bond Support Lenders shall provide a
super-priority (a) term loan facility and (b) letter of credit facility, in an
aggregate principal amount of up to $40,000,000 for the purposes specified
therein;
NOW, THEREFORE, in consideration of the premises and the covenants and
agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
Item 40.
DEFINITIONS
(a) Definitions.
As used in this Agreement, the following terms shall have the meanings
specified below unless the context otherwise requires:
"Acquisition" means any transaction in which any Credit Party directly
or indirectly (a) acquires any Property with which an ongoing business is
conducted or is to be conducted, (b) acquires all or substantially all of the
assets of any Person or division thereof, whether through a purchase of assets,
merger or otherwise, (c) acquires (in one transaction or as the most recent
transaction in a series of transactions) control of at least a majority of the
Voting Stock of a corporation, other than the acquisition of Voting Stock of a
wholly-owned Subsidiary solely in connection with the organization and
capitalization of that Subsidiary by such Credit Party, or (d) acquires control
of more than 50% ownership interest in any Person.
"Administrative Agent" has the meaning specified in the preamble
hereto.
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such Person. For purposes of this definition, "control" when
used with respect to any Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agreement" means this Debtor-in-Possession Transit Revolving Credit
Agreement, together with all Exhibits and Schedules hereto, as the same may be
amended, supplemented, restated or otherwise modified from time to time.
"Availability Period" means the period from the Closing Date to the
earlier of (i) the Business Day immediately preceding the Maturity Date, or (ii)
the date on which the Commitments are terminated in accordance with the
provisions of this Agreement.
"Bank Administrative Agent" means the "Administrative Agent" under the
TP&S Revolving Credit Agreement and any successor thereto.
"Bank Lenders" has the meaning specified in the recitals hereto.
"Bankruptcy Cases" has the meaning specified in the recitals hereto.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
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"Bankruptcy Court" has the meaning specified in the recitals hereto.
"Bond Credit Agreement" has the meaning specified in the recitals
hereto.
"Bond Support Administrative Agent" means the "Administrative Agent"
under the Bond Support Credit Agreement and any successor thereto.
"Bond Support Credit Agreement" has the meaning specified in the
recitals hereto.
"Bond Support Lenders" has the meaning specified in the recitals
hereto.
"Borrower" has the meaning specified in the preamble hereto.
"Borrowing" means Loans made on the same date.
"Business Day" means a day other than a Saturday, Sunday or other day
on which commercial banks in Baltimore, Maryland or New York, New York are
authorized or required by law to close.
"Business Plan" has the meaning set forth in Section 5.01(d)(vi).
"Businesses" has the meaning specified in Section 4.16(a).
"Capital Expenditures" means, as applied to any Person for any period,
any capital expenditures of such Person determined in accordance with GAAP for
such period.
"Capital Lease" means, as applied to any Person, any lease of any
Property by that Person as lessee which, in accordance with GAAP, is or should
be accounted for as a capital lease on the balance sheet of that Person.
"Capital Lease Obligation" means the capital lease obligations relating
to a Capital Lease determined in accordance with GAAP.
"Capital Stock" means (a) in the case of a corporation, capital stock,
(b) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
capital stock, (c) in the case of a partnership, partnership interests (whether
general or limited), (d) in the case of a limited liability company, membership
interests and (e) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.
"Carve-Out" has the meaning specified in Section 9.01(a).
"Cash Equivalents" means (a) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than twelve months from the date of acquisition, (b) U.S. Dollar denominated
time deposits and certificates of deposit of (i) any Lender or (ii) any domestic
commercial bank of recognized standing (y) having capital and surplus in excess
of $500,000,000 and (z) whose short-term commercial paper rating from S&P is at
least A-1 or the equivalent thereof or from Xxxxx'x is at least P-1 or the
equivalent thereof (any such bank being an "Approved Bank"), in each case with
maturities of not more than 270 days from the date of acquisition, (c)
commercial paper and variable or fixed rate notes issued by any Approved Bank
(or by the parent company thereof) or any variable rate notes issued by, or
guaranteed by, any domestic corporation rated A-1 (or the equivalent thereof) or
better by S&P or P-1 (or the equivalent thereof) or better by Moody's and
maturing within six months of the date of acquisition, (d) repurchase agreements
entered into by a Person with a bank or trust company (including any of the
Lenders) or recognized securities dealer having capital and surplus in excess of
$500,000,000 for direct obligations issued by or fully guaranteed by the United
States of America in which such Person shall have a perfected first priority
security interest (subject to no other Liens) and having, on the date of
purchase thereof, a fair market value of at least 100% of the amount of the
repurchase obligations, (e) obligations of any State of the United States or any
political subdivision thereof, the
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interest with respect to which is exempt from federal income taxation under
Section 103 of the Internal Revenue Code, having a long term rating of at least
AA- or Aa-3 by S&P or Moody's, respectively, and maturing within three years
from the date of acquisition thereof, (f) Investments in municipal auction
preferred stock (i) rated AAA (or the equivalent thereof) or better by S&P or
Aaa (or the equivalent thereof) or better by Moody's and (ii) with dividends
that reset at least once every 365 days, (g) Investments, classified in
accordance with GAAP as current assets, in money market investment programs
registered under the Investment Company Act of 1940, as amended, which are
administered by reputable financial institutions having capital of at least
$100,000,000 and the portfolios of which are limited to Investments of the
character described in the foregoing subdivisions (a) through (f), and (h) other
Investments deemed to be cash equivalents in accordance with GAAP.
"Cass County Contract" means that certain agreement, dated as of
September 21, 1999, by and among Neosho Construction Company, Incorporated and
the Texas Department of Transportation, Cass County, which has been bonded by
Reliance (Travelers), bond number B2968607 and which has an estimated loss of
$1,132,000 as determined by the Borrower's management.
"Change of Control" means the occurrence of either of the following
events: (a) any "person" (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act), other than a trustee or other fiduciary holding securities
under an employee benefit plan of the Borrower, a corporation owned directly or
indirectly by the stockholders of the Borrower or any of their respective
Affiliates, becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Borrower
representing 50% or more of the total voting power represented by the Borrower's
then outstanding securities that vote generally in the election of directors; or
(b) during any period of two consecutive years, individuals who at the beginning
of such period constitute the Borrower's Board of Directors and any new
directors whose election by the Borrower's Board of Directors or nomination for
election by the Borrower's stockholders was approved by a vote or a majority of
the directors then still in office who either were directors at the beginning of
the period or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority of the Borrower's Board
of Directors.
"Closing Date" means the date on which the conditions specified in
Sections 3.01 and 3.02 are satisfied (or waived in accordance with Section
11.06).
"Collateral" means the Property subject to the security interests and
liens granted to the Administrative Agent under this Agreement and the other
Credit Documents.
"Collateral Documents" means the Pledge Agreement, the Security
Agreement and any other document or instrument executed and delivered by a
Person granting a Lien on any of its property to secure payment of the
Obligations.
"Commitment" means, (a) in the case of each Lender that is a Lender on
the date hereof, the amount set forth opposite such Lender's name on Schedule I
as such Lender's "Commitment" and (b) in the case of any Lender that becomes a
Lender after the date hereof, the amount specified as such Lender's "Commitment"
in the Assignment and Acceptance pursuant to which such Lender assumed a portion
of the Commitments, in each case, as the same may be changed from time to time
pursuant to the terms hereof.
"Consolidated Capital Expenditures" means, for any period for the
Consolidated Group, capital expenditures determined on a consolidated basis in
accordance with GAAP for such period.
"Consolidated Group" means the Borrower and its consolidated
subsidiaries as determined in accordance with GAAP.
"Consultant" has the meaning specified in Section 5.07(d).
"Contractual Obligation" means, as to any Credit Party, any provision
of any security issued by such Credit Party or of any material agreement,
instrument or undertaking to which such Credit Party is a party or by which it
or any of its property is bound.
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"Credit Documents" means, collectively, this Agreement, the Notes, each
Joinder Agreement, the Collateral Documents and all other related agreements and
documents issued or delivered hereunder or thereunder or pursuant hereto or
thereto.
"Credit Party" means any of the Borrower and the Guarantors.
"Crisis Manager" has the meaning specified in Section 5.07(e).
"CSFB" has the meaning specified in the preamble hereto.
"Default" means any event, act or condition which with notice or lapse
of time, or both, would constitute an Event of Default.
"DIP Financing Order" means the Interim DIP Financing Order or the
Final DIP Financing Order, as applicable.
"Divestiture" means any transaction by which any member of the Transit
Group sells, leases, transfers or otherwise disposes of (a) any Property or (b)
the Capital Stock of a member of the Transit Group, in each case other than (i)
the sale of inventory in the ordinary course of business, (ii) the sale, lease,
transfer or other disposition of plant, property and equipment which is no
longer used or useful in the business of the members of the Transit Group, (iii)
the sale, lease, transfer or other disposition of plant, property and equipment
to the extent that the Net Cash Proceeds thereof are (A) deposited into a cash
collateral account maintained by the Administrative Agent and (B) reinvested in
similar property of at least equal collateral value within six (6) months of the
date of such sale, lease, transfer or other disposition (and such reinvested
amounts shall constitute Capital Expenditures for purposes of this Agreement),
and (iv) the sale, lease, transfer or other disposition of Property or Capital
Stock of a member of the Transit Group to a Domestic Credit Party.
"Dollars" and "$" means dollars in lawful currency of the United States
of America.
"Domestic Credit Party" means any Credit Party that is incorporated or
organized under the laws of any State of the United States or the District of
Columbia.
"Domestic Subsidiary" means any Subsidiary that is incorporated or
organized under the laws of any State of the United States or the District of
Columbia.
"Emergency Loan" has the meaning specified in the recitals hereto.
"Environmental Laws" means any and all lawful and applicable federal,
state, local and foreign statutes, laws, regulations, ordinances, rules,
judgments, orders, decrees, permits, concessions, grants, franchises, licenses,
agreements or other governmental restrictions relating to the environment or to
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or wastes
into the environment including, without limitation, ambient air, surface water,
ground water, or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, toxic or hazardous
substances or wastes.
"Equity Transaction" means, with respect to any Credit Party, any
issuance of shares of its Capital Stock, other than (a) an issuance by a
Guarantor to a Domestic Credit Party, (b) an issuance in connection with a
conversion of debt securities to equity, (c) an issuance in connection with the
exercise by a present or former employee, officer or director under a stock
incentive plan, stock option plan or other equity-based compensation plan or
arrangement or (d) an issuance needed to qualify directors under applicable law.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto, as interpreted by the rules and
regulations thereunder, all as the same may be in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
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"ERISA Affiliate" means an entity which is under common control with
any Credit Party or any of its Subsidiaries within the meaning of Section
4001(a)(14) of ERISA, or is a member of a group which includes any Credit Party
or any of its Subsidiaries and which is treated as a single employer under
Sections 414(b) or (c) of the Internal Revenue Code.
"ERISA Event" means (a) with respect to any Plan, the occurrence of a
Reportable Event or the substantial cessation of operations (within the meaning
of Section 4062(e) of ERISA); (b) the withdrawal by any Credit Party or any of
its Subsidiaries or any ERISA Affiliate from a Multiple Employer Plan during a
plan year in which it was a substantial employer (as such term is defined in
Section 4001(a)(2) of ERISA), or the termination of a Multiple Employer Plan;
(c) the distribution of a notice of intent to terminate or the actual
termination of a Plan pursuant to Section 4041(a)(2) or 4041A of ERISA; (d) the
institution of proceedings to terminate or the actual termination of a Plan by
the PBGC under Section 4042 of ERISA; (e) any event or condition which would
reasonably be expected to constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan; (f) the
complete or partial withdrawal of any Credit Party or any of its Subsidiaries or
any ERISA Affiliate from a Multiemployer Plan; (g) the conditions for imposition
of a lien under Section 302(f) of ERISA exist with respect to any Plan; or (h)
the adoption of an amendment to any Plan requiring the provision of security to
such Plan pursuant to Section 307 of ERISA.
"Event of Default" has the meaning specified in Section 7.01.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excluded Assets" means (a) avoidance actions (and proceeds thereof)
under Chapter 5 of the Bankruptcy Code other than actions under Section 549
thereof and (b) the percentage of the Capital Stock of Foreign Subsidiaries that
are members of the Transit Group that is not pledged under the Pledge Agreement.
"Expense Account" has the meaning specified in Section 5.11(c).
"Facilities" has the meaning specified in Section 4.16(a).
"Federal Funds Rate" means, for any day, the rate of interest per annum
(rounded upwards, if necessary, to the nearest whole multiple of 1/100 of 1%)
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 by the Federal Reserve Bank of New York
on the Business Day next succeeding such day; provided that (a) if such day is
not a Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day and (b) if no such rate is
so published on such next preceding Business Day, the Federal Funds Rate for
such day shall be the average rate quoted to the Administrative Agent on such
day on such transactions as determined by the Administrative Agent.
"Filing Date" has the meaning specified in the recitals hereto.
"Final DIP Financing Order" means the final order entered by the
Bankruptcy Court authorizing and approving the Credit Documents, the Financing
Agreements and in each case, the transactions contemplated thereby, which shall
include, without limitation, the provisions included in the Interim DIP
Financing Order and shall be in a form satisfactory to the Administrative Agent
and the Lenders in their sole discretion.
"Financing Agreements" means, collectively, (a) the "Credit Documents",
as defined in the TP&S Revolving Credit Agreement, (b) the Bond Credit
Agreement, the Bonds (as defined therein) and all other agreements and documents
issued or delivered thereunder and (c) the "Credit Documents", as defined in the
Bond Support Credit Agreement.
"Forecast" has the meaning specified in Section 5.01(c)(iii)(A).
"Foreign Subsidiary" means a Subsidiary that is not a Domestic
Subsidiary.
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"GAAP" means generally accepted accounting principles in the United
States applied on a consistent basis and subject to the terms of Section 1.03.
"General Corporate Overhead Expenses" means the expenses of the
corporate office that are not specifically allocable to either the Transit Group
or the TP&S Group.
"General Restructuring Costs" are the restructuring costs that are not
specifically allocable to either the Transit Group or the TP&S Group.
"Governmental Authority" means any federal, state, local or foreign
court or governmental agency, authority, instrumentality or regulatory body.
"Guaranteed Obligations" means, as to each Guarantor, without
duplication, all obligations of the Borrower to the Lenders and the
Administrative Agent, whenever arising, under this Agreement, the Notes or the
other Credit Documents.
"Guarantor" means each of those Persons identified as a "Guarantor" on
the signature pages hereto and each other Person which may hereafter become a
Guarantor by execution of a Joinder Agreement, together with its successors and
permitted assigns.
"Indebtedness" means, with respect to any Person, (a) all obligations
of such Person for borrowed money, (b) all obligations of such Person evidenced
by bonds, debentures, notes or similar instruments, or upon which interest
payments are customarily made, (c) all obligations of such Person under
conditional sale or other title retention agreements relating to Property
purchased by such Person (other than customary reservations or retentions of
title under agreements with suppliers entered into in the ordinary course of
business), (d) all obligations of such Person issued or assumed as the deferred
purchase price of Property or services purchased by such Person (other than
trade debt incurred in the ordinary course of business and due within six months
of the incurrence thereof) which would appear as liabilities on a balance sheet
of such Person, (e) all obligations of such Person under take-or-pay or similar
arrangements or under commodities agreements, (f) all Indebtedness of others
secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien on, or payable out of the
proceeds of production from, Property owned or acquired by such Person, whether
or not the obligations secured thereby have been assumed, provided that for
purposes hereof the amount of such Indebtedness shall be limited to the greater
of (i) the amount of such Indebtedness as to which there is recourse to such
Person and (ii) the fair market value of the Property which is subject to the
Lien, (g) all Support Obligations of such Person, (h) the principal portion of
all obligations of such Person under Capital Leases, (i) all obligations of such
Person in respect of interest rate protection agreements, foreign currency
exchange agreements, commodity purchase or option agreements or other interest
or exchange rate or commodity price hedging agreements, (j) the maximum amount
of all standby letters of credit issued or bankers' acceptances facilities
created for the account of such Person and, without duplication, all drafts
drawn thereunder (to the extent unreimbursed), (k) all preferred stock issued by
such Person and required by the terms thereof to be redeemed, or for which
mandatory sinking fund payments are due, by a fixed date, (l) the outstanding
attributed principal amount under any Securitization Transaction and (m) the
principal balance outstanding under any synthetic lease, tax retention operating
lease, off-balance sheet loan or similar off-balance sheet financing product to
which such Person is a party, where such transaction is considered borrowed
money indebtedness for tax purposes but is classified as an operating lease in
accordance with GAAP ("Synthetic Leases"). The Indebtedness of any Person shall
include the Indebtedness of any partnership or joint venture in which such
Person is a general partner or a joint venturer, but only to the extent to which
there is recourse to such Person for payment of such Indebtedness.
"Indemnitee" has the meaning specified in Section 11.05(b).
"Information" has the meaning specified in Section 11.14.
"Initial Transit Budget" has the meaning specified in Section
5.01(d)(iv).
7
"Intellectual Property" means all Copyrights, Copyright Licenses,
Patents, Patent Licenses, Trademarks and Trademark Licenses, as each of those
terms are defined in the Security Agreement.
"Interim DIP Financing Order" means the interim order entered by the
Bankruptcy Court authorizing and approving, subject to the approval of the Final
DIP Financing Order, the Credit Documents and the transactions contemplated
hereby, which order shall be substantially in the form of Exhibit D and shall
otherwise be in form and substance satisfactory to the Lenders and the
Administrative Agent.
"Interim Period" means the period commencing on the date of entry of
the Interim DIP Financing Order and ending on the earlier of (i) 45 days
thereafter and (ii) the date of entry of the Final DIP Financing Order by the
Bankruptcy Court.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended, and any successor statute thereto, as interpreted by the rules and
regulations issued thereunder, in each case as in effect from time to time.
References to sections of the Internal Revenue Code shall be construed also to
refer to any successor sections.
"Investment", in any Person, means any loan or advance to such Person,
any purchase or other acquisition of any Capital Stock, warrants, rights,
options, obligations or other securities of, or equity interest in, such Person,
any capital contribution to such Person or any other investment in such Person,
including, without limitation, any Support Obligation incurred for the benefit
of such Person.
"Joinder Agreement" means a joinder agreement substantially in the form
of Exhibit C hereto executed and delivered by a Domestic Subsidiary which is a
member of the Transit Group in accordance with the provisions of Section
5.09(a).
"Lenders" has the meaning specified in the preamble hereto.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, encumbrance, lien (statutory or otherwise),
preference, priority or charge of any kind (including any agreement to give any
of the foregoing, any conditional sale or other title retention agreement, and
any lease in the nature thereof).
"Loans" has the meaning specified in Section 2.01.
"Majority Lenders" means, at any time, Lenders holding more than 50% of
the then aggregate unpaid principal amount of the Loans or, if no Loans are then
outstanding, Lenders having more than 50% of the aggregate Commitments.
"Material Adverse Effect" means a material adverse effect on (a) the
condition (financial or otherwise), operations, business, prospects, assets or
liabilities of the Credit Parties taken as a whole, (b) the ability of the
Credit Parties taken as a whole to perform any obligation under the Credit
Documents, (c) the legality, validity or enforceability of any Credit Document,
(d) the perfection or priority of the Liens granted pursuant hereto and the
other Credit Documents or (e) the rights and remedies of the Lenders under the
Credit Documents or the DIP Financing Order.
"Material Pleading" means any of the following items filed with the
Bankruptcy Court (a) a plan of reorganization, (b) a disclosure statement with
respect to a plan of reorganization, (c) a motion to extend the Credit Parties'
exclusive right to file a plan of reorganization and solicit acceptances in
connection thereto, (d) a motion, under Section 363 of the Bankruptcy Code, to
sell, lease or otherwise dispose of an asset or assets of the estate in an
amount not to exceed $1,000,000 for any sale, lease or other disposition and
$5,000,000 in the aggregate for all sales, leases and other dispositions, (e) a
motion, under Section 363 of the Bankruptcy Code, to implement, adopt or revise
an employee retention, severance or similar program, (f) a motion, under Section
364 of the Bankruptcy Code, for any "debtor-in-possession financing" (other than
the debtor-in-possession financing authorized in the DIP Financing Order) that
does not provide for the repayment in full of the Obligations on the date the
first loan is made under such other financing, (g) a motion, under Section 105
of the Bankruptcy Code, to substantively consolidate
8
(A) the estate of the Borrower with the estate of any other member of the
Consolidated Group or (B) the estate of any Guarantor with the estate of any
member of the Consolidated Group that is not a Guarantor, and (h) any other
pleading that would impair, or would have the effect of impairing, the
Borrower's ability to repay its obligations arising hereunder or under the DIP
Financing Order.
"Materials of Environmental Concern" means any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Laws, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.
"Maturity Date" means the earliest to occur of (a) September 30, 2002,
(b) the effective date of any Credit Party's plan of reorganization and (c) the
sale of the Transit Group or the sale of all or substantially all of the Transit
Group's Property.
"Moody's" means Xxxxx'x Investors Service, Inc., or any successor or
assignee of the business of such company in the business of rating securities.
"Multiemployer Plan" means a Plan which is a multiemployer plan as
defined in Sections 3(37) or 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan which any Credit Party or any of
its Subsidiaries or any ERISA Affiliate and at least one employer other than any
Credit Party or any of its Subsidiaries or any ERISA Affiliate are contributing
sponsors.
"Net Cash Proceeds" means the aggregate proceeds paid in cash or Cash
Equivalents received by any Credit Party in respect of any Divestiture, net of
(a) direct costs (including, without limitation, legal, accounting and
investment banking fees, and sales commissions) paid or payable as a result
thereof, (b) taxes paid or payable as a result thereof, (c) repayment of
Indebtedness that is required to be repaid in connection with such Divestiture,
and (d) appropriate amounts to be provided by such Credit Party as a reserve, in
accordance with GAAP, against liabilities associated with such Divestiture and
retained by such Credit Party after such Divestiture, including, without
limitation, pension and other post-employment benefit liabilities, liabilities
related to environmental matters and liabilities under any indemnification
obligations associated with such Divestiture; provided that "Net Cash Proceeds"
shall include an amount equal to any reserves previously taken against
liabilities associated with Divestitures immediately upon those reserves being
determined to be in excess of such liabilities. The "Net Cash Proceeds" shall
also include, without limitation, any cash or Cash Equivalents received upon the
sale or other disposition of any non-cash consideration received by any Credit
Party.
"Note" has the meaning specified in Section 2.06.
"Notice of Borrowing" has the meaning specified in Section 2.02(a).
"Obligations" means the Loans, the Notes and all other advances, debts,
liabilities, obligations, covenants and duties owing by the Borrower and each of
the Guarantors to the Administrative Agent, any Lender, any Affiliate of any of
them or any Indemnitee, of every type and description, present or future,
whether or not evidenced by any note, Joinder Agreement or other instrument,
arising under this Agreement or under any other Credit Document, whether or not
for the payment of money, loan, guaranty, indemnification or in any other
manner, whether direct or indirect (including, without limitation, those
acquired by assignment), absolute or contingent, due or to become due, now
existing or hereafter arising and however acquired. The term "Obligations"
includes, without limitation, all interest, charges, expenses, fees, attorneys'
fees and disbursements and any other sum chargeable to any of the Credit Parties
under this Agreement or any other Credit Document.
"Operating Lease" means, as applied to any Person, any lease
(including, without limitation, leases which may be terminated by the lessee at
any time) of any Property which is not a Capital Lease other than any such lease
in which that Person is the lessor.
9
"Other Taxes" has the meaning specified in Section 2.13(b).
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA and any successor thereof.
"Permitted Expenses" means any fees or expenses paid by any Credit
Party in accordance with the DIP Financing Order and as otherwise allowed by the
Bankruptcy Court.
"Permitted Investments" means Investments which are (a) Investments
that are approved by the Bankruptcy Court; (b) cash and Cash Equivalents; (c)
accounts receivable created, acquired or made in the ordinary course of business
and payable or dischargeable in accordance with customary trade terms; (d)
Investments consisting of stock, obligations, securities or other property
received in settlement of accounts receivable (created in the ordinary course of
business) from obligors; (e) Support Obligations permitted by Section 6.01; (f)
Investments existing on the Filing Date made by the Borrower or any other Credit
Party in or to its Subsidiaries; and (g) Investments by any Credit Party in and
to a Domestic Credit Party.
"Permitted Liens" means:
(a) Liens in favor of the Pre-Petition Agents and the Pre-Petition
Lenders in connection with the Pre-Petition Credit Facility, and any adequate
protection liens granted thereto pursuant to the Interim DIP Financing Order and
the Final DIP Financing Order;
(b) the Carve-Out and the UST/Clerk Fees;
(c) Liens relating to periods or arising after the Filing Date
(other than Liens created or imposed under ERISA) for taxes, assessments or
governmental charges or levies not yet due or Liens for taxes being contested in
good faith by appropriate proceedings for which adequate reserves determined in
accordance with GAAP have been established (and as to which the Property subject
to any such Lien is not yet subject to foreclosure, sale or loss on account
thereof);
(d) Liens in respect of Property imposed by law arising in the
ordinary course of business such as materialmen's, mechanics', warehousemen's,
carriers', suppliers', landlords', and other like Liens provided that (i) for
any such Liens arising before the Filing Date, the enforcement and collection of
such Liens is stayed by section 362 of the Bankruptcy Code, and (ii) for any
such Liens arising after the Filing Date, such Liens secure only amounts not
overdue for a period of more than 30 days or are being contested in good faith
by appropriate proceedings for which adequate reserves determined in accordance
with GAAP have been established (and as to which the Property subject to any
such Lien is not yet subject to foreclosure, sale or loss on account thereof);
(e) Liens (other than Liens created or imposed under ERISA)
consisting of deposits made by the Borrower and its Subsidiaries in the ordinary
course of business in connection with, or to secure payment of, obligations
under workers' compensation, unemployment insurance, social security and other
similar laws, or to secure the performance of tenders, statutory obligations,
bids, leases, government contracts, performance and return-of-money bonds and
other similar obligations (exclusive of obligations for the payment of borrowed
money);
(f) Liens in connection with attachments or judgments (including
judgment or appeal bonds) provided that the judgments secured shall, within 30
days after the entry thereof, have been discharged or execution thereof stayed
pending appeal, or shall have been discharged within 30 days after the
expiration of any such stay;
(g) easements, rights-of-way, restrictions (including zoning
restrictions), minor defects or irregularities in title and other similar
charges or encumbrances not, in any material respect, impairing the use of the
encumbered Property for its intended purposes;
(h) Liens securing purchase money Indebtedness (including Capital
Leases) to the extent permitted under Section 6.01(d) provided that any such
Lien attaches only to the Property financed and such Lien attaches
10
thereto concurrently with or within 90 days after the acquisition thereof in
connection with the purchase money transactions;
(i) leases or subleases granted to others not interfering in any
material respect with the business of the Borrower or any Subsidiary;
(j) any interest of title of a lessor under, and Liens arising
from UCC financing statements (or equivalent filings, registrations or
agreements in foreign jurisdictions) relating to, leases permitted by this
Agreement;
(k) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods;
(l) Liens deemed to exist in connection with Investments in
repurchase agreements permitted under Section 6.05;
(m) the equitable interests of any surety validly acquired by
right of subrogation or under applicable non-bankruptcy law to the extent such
interests (i) are senior to those of the Credit Parties and the liens granted in
connection with the Pre-Petition Credit Facility and (ii) have not been waived
or released by Travelers as provided in the Interim DIP Financing Order or the
Final DIP Financing Order;
(n) Liens that are perfected (but not granted) after the Filing
Date to the extent such post-petition perfection is permitted under the
Bankruptcy Code and which are superior under applicable law to liens granted in
connection with the Pre-Petition Credit Facility;
(o) normal and customary rights of setoff upon deposits of cash in
favor of banks or other depository institutions;
(p) Liens in respect of Indebtedness permitted under Section
6.01(f), limited solely to sums payable under the policy or policies to which
such Indebtedness relates;
(q) Liens existing as of the Filing Date and set forth on Schedule
II; provided that no such Lien shall at any time be extended to or cover any
Property other than the Property subject thereto on the Closing Date;
(r) Liens in favor of (i) the Bond Support Administrative Agent
granted pursuant to the Bond Support Credit Agreement and (ii) Travelers granted
pursuant to the Bond Credit Agreement;
(s) Liens created pursuant to the Credit Documents; and
(t) Senior Liens
"Person" means any individual, partnership, firm, corporation, limited
liability company, association, trust or other enterprise or entity (whether or
not incorporated) or any Governmental Authority.
"Plan" means any employee benefit plan (as defined in Section 3(3) of
ERISA) which is covered by ERISA and with respect to which any Credit Party or
any of its Subsidiaries or any ERISA Affiliate is (or, if such plan were
terminated at such time, would under Section 4069 of ERISA be deemed to be) an
"employer" within the meaning of Section 3(5) of ERISA.
"Pledge Agreement" means a pledge agreement, in form and substance
satisfactory to the Lenders and the Administrative Agent, executed by the
Borrower, as such agreement may be amended, supplemented, restated or modified
from time to time.
"Pre-Petition Agents" means the administrative agent and the collateral
agent under the Pre-Petition Credit Facility and the documents related thereto.
11
"Pre-Petition Credit Agreement" means that certain Amended and Restated
Credit Agreement, dated as of April 28, 2000, as amended, by and among the
Borrower, the guarantors party thereto, the lenders identified therein and Bank
of America, N.A., as administrative agent.
"Pre-Petition Credit Facility" means the $100 million revolving credit
facility and the $150 million term loan credit facility provided to the Borrower
pursuant to the Pre-Petition Credit Agreement.
"Pre-Petition Lenders" means the lenders party to the Pre-Petition
Credit Agreement.
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by X.X. Xxxxxx Xxxxx as its "prime" or "base" rate in effect
at its principal office in New York, New York, with each change in the Prime
Rate being effective on the date such change is publicly announced as effective
(it being understood and agreed that the Prime Rate is a reference rate used by
X.X. Xxxxxx Chase in determining interest rates on certain loans and is not
intended to be the lowest rate of interest charged on any extension of credit by
X.X. Xxxxxx Xxxxx to any debtor).
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Ratable Portion" means, with respect to each Lender, a fraction
(expressed as a percentage) the numerator of which is the Commitment of such
Lender at such time and the denominator of which is the aggregate Commitments of
all Lenders at such time.
"Register" has the meaning specified in Section 11.03(c).
"Regulation D, O, T, U or X" means Regulation D, O, T, U or X,
respectively, of the Board of Governors of the Federal Reserve System as from
time to time in effect and any successor to all or a portion thereof.
"Release" means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping or disposing into
the environment (including the abandonment or discarding of barrels, containers
and other closed receptacles containing any Materials of Environmental Concern).
"Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA, other than those events as to which the notice requirement has been
waived by regulation.
"Requirement of Law" means, as to any Person, any law, treaty, rule or
regulation or determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or any of its
material property is subject.
"Responsible Officer" means the Chief Executive Officer, the Chief
Financial Officer, the Controller, the Chief Operating Officer, the Chief
Accounting Officer and the Treasurer of the Borrower.
"Restricted Payment" by any Person means (a) any dividend or other
distribution, direct or indirect, on account of any shares of any class of stock
of such Person now or hereafter outstanding, except (i) a dividend payable
solely in shares of that class to the holders of that class and (ii) dividends
and other distributions payable to a Domestic Credit Party, (b) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of any class of Capital Stock of such
Person now or hereafter outstanding, and (c) any payment made to retire, or to
obtain the surrender of, any outstanding warrants, options or other rights to
acquire shares of any class of Capital Stock of such Person now or hereafter
outstanding.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill,
Inc., or any successor or assignee of the business of such division in the
business of rating securities.
"SEC" means the Securities and Exchange Commission and any successor
Governmental Authority.
12
"Second Transit Budget" has the meaning specified in Section
5.01(d)(iv).
"Securitization Transaction" means any financing transaction or series
of financing transactions entered into by a Credit Party pursuant to which such
Credit Party may sell, convey or otherwise transfer to (a) a Subsidiary or
Affiliate (a "Securitization Subsidiary"), or (b) any other Person, or may grant
a security interest in, any receivables or interests therein secured by
merchandise or services financed thereby (whether such receivables are then
existing or arising in the future) of such Credit Party, and any assets related
thereto, including without limitation, all security interests in merchandise or
services financed thereby, the proceeds of such receivables, and other assets
which are customarily sold or in respect of which security interests are
customarily granted in connection with securitization transactions involving
such assets.
"Security Agreement" means an agreement, in form and substance
satisfactory to the Lenders and the Administrative Agent, executed by each
Credit Party, as such agreement may be amended, supplemented, restated or
modified from time to time.
"Senior Liens" means the Liens granted to the Administrative Agent for and on
behalf of the Lenders pursuant to this Agreement and the other Credit Documents
that have been granted secured status by the Bankruptcy Court pursuant to
sections 364(c)(2), 364(c)(3) and 364(d) of the Bankruptcy Code subject only to
(a) any statutory liens existing as of the Filing Date that by statute are
senior to the liens of the Pre-Petition Lenders, (b) any purchase money security
interests under applicable law existing as of the Filing Date which are senior
to the liens in favor of the Pre-Petition Lenders arising prior to the Filing
Date, (c) those senior liens and interests arising as a matter of law as a
result of equitable subrogation or other applicable non-bankruptcy law in favor
of Travelers, as issuer of surety bonds and as administrator for it and certain
other surety companies that have issued surety bonds on behalf of the Credit
Parties, (d) the Carve-Out and (e) UST/Clerk Fees.
"Single Employer Plan" means any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan or a Multiple Employer Plan.
"Specified Contracts" has the meaning specified in Section 4.15(a)(ii).
"Statutory Committee" has the meaning specified in Section 9.01(a).
"Subsidiary" means, as to any Person, (a) any corporation more than 50%
of whose stock of any class or classes having by the terms thereof ordinary
voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time, any class or classes of such
corporation shall have or might have voting power by reason of the happening of
any contingency) is at the time owned by such Person directly or indirectly
through Subsidiaries, and (b) any partnership, association, limited liability
company or other entity in which such Person directly or indirectly through
Subsidiaries has more than 50% of the voting interests at any time.
Notwithstanding anything herein to the contrary, the term "Subsidiary" shall not
include Xxxxx South, Inc., a Georgia corporation. Unless otherwise identified,
"Subsidiary" shall mean a Subsidiary of the Borrower.
"Support Obligations" means, with respect to any Person, without
duplication, any obligations of such Person (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or collection)
guaranteeing or intended to guarantee any Indebtedness of any other Person in
any manner, whether direct or indirect, and including without limitation any
obligation, whether or not contingent, (a) to purchase any such Indebtedness or
any Property constituting security therefor, (b) to advance or provide funds or
other support for the payment or purchase of any such Indebtedness or to
maintain working capital, solvency or other balance sheet condition of such
other Person (including without limitation keep well agreements, maintenance
agreements, comfort letters or similar agreements or arrangements) for the
benefit of any holder of Indebtedness of such other Person, (c) to lease or
purchase Property, securities or services primarily for the purpose of assuring
the holder of such Indebtedness against loss, or (d) to otherwise assure or hold
harmless the holder of such Indebtedness against loss in respect thereof, but
specifically excluding guaranties or other assurances with respect to any Credit
Party's performance obligations under bids or contracts made or entered into in
the ordinary course of business. The amount of any Support Obligation hereunder
shall (subject to any limitations set forth therein) be deemed to be an amount
equal to the outstanding principal amount (or maximum principal amount, if
larger) of the Indebtedness in respect of which such Support Obligation is made.
13
"Synthetic Leases" shall have the meaning assigned to such term in the
definition of "Indebtedness".
"Taxes" has the meaning specified in Section 2.13(a).
"TP&S Revolving Credit Agreement" has the meaning specified in the
recitals hereto.
"Transit Budget" has the meaning specified in Section 5.01(d)(iv).
"Transit Group" means, collectively, the Borrower (with respect to the
"transit" segment of its business), Guarantors and any other Domestic Subsidiary
that is part of the "transit" segment of the Borrower's business.
"Transit Payment Account" has the meaning specified in Section
5.13(a)(i).
"Transit Payment Account Agent" has the meaning specified in Section
5.13(a)(i).
"Travelers" means Travelers Casualty & Surety Company of America and
any of its Affiliates and Subsidiaries.
"UCC" means the Uniform Commercial Code, as in effect in any applicable
jurisdiction.
"United States Trustee" means the United States trustee, appointed
pursuant to 28 U.S.C. ss.581, for the District of Maryland.
"UST/Clerk Fees" means fees required to be paid pursuant to 28 U.S.C
ss. 1930(a)(6) and any fees payable to the Clerk of the Bankruptcy Court and any
agent thereof.
"Variance Analysis" has the meaning specified in Section
5.01(c)(iii)(B).
"Voting Stock" means, with respect to any Person, Capital Stock issued
by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.
(b) Computation of Time Periods
For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding."
(c) Accounting Terms; Certain Calculations.
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the
Administrative Agent or the Lenders hereunder shall be prepared, in accordance
with GAAP applied on a consistent basis. All calculations made for the purposes
of determining compliance with this Agreement shall (except as otherwise
expressly provided herein) be made by application of GAAP applied on a basis
consistent with the most recent annual or quarterly financial statements
delivered pursuant to Section 5.01; provided, however, if (a) the Borrower shall
object to determining such compliance on such basis at the time of delivery of
such financial statements due to any change in GAAP or the rules promulgated
with respect thereto or (b) the Administrative Agent or the Required Lenders
shall so object in writing within 30 days after delivery of such financial
statements, then such calculations shall be made on a basis consistent with the
most recent financial statements delivered by the Borrower to the Lenders as to
which no such objection shall have been made.
14
(d) Certain Terms.
(a) The words "herein," "hereof" and "hereunder" and other words
of similar import refer to this Agreement as a whole, and not
to any particular Article, Section, subsection or clause in
this Agreement. References herein to an Exhibit, Schedule,
Article, Section, subsection or clause refer to the
appropriate Exhibit or Schedule to, or Article, Section,
subsection or clause in, this Agreement.
(b) The terms "Lender" and "Administrative Agent" include their
respective successors and the term "Lender" includes each
assignee of such Lender who becomes a party hereto pursuant to
Section 11.03(b).
(c) Any definition of or reference to any agreement, instrument or
other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time
amended, supplemented or otherwise modified.
Item 41.
THE LOANS
(a) Loans.
(a) Loans. Subject to the terms and conditions set forth herein,
each Lender severally agrees to make a loan (each a "Loan"
and, collectively, the "Loans") to the Borrower, which Loans
(i) shall be made on the Closing Date and from time to time
thereafter if requested by the Borrower pursuant to Section
2.02 during the Availability Period, (ii) may be prepaid in
accordance with the provisions hereof, and once prepaid, may
be reborrowed in accordance with the terms hereof, (iii) shall
not exceed at any time outstanding for any such Lender the
Commitment of such Lender and (iv) shall not exceed at any
time outstanding in the aggregate the aggregate Commitments of
all of the Lenders.
(b) Amount of Loans on the Closing Date. The Borrower may borrow
an aggregate amount of up to $20,000,000 of Loans on the
Closing Date.
(b) Method of Borrowing.
(a) Each Borrowing of Loans subsequent to the Closing Date shall
be made on notice, given by the Borrower to the Administrative
Agent not later than 11:00 A.M. (New York City time) on the
Business Day prior to the date of the proposed Borrowing. Each
such notice (a "Notice of Borrowing") shall be in
substantially the form of Exhibit B, specifying therein (a)
the date of such proposed Borrowing and (b) the aggregate
amount of such proposed Borrowing, accompanied by a
description in reasonable detail of the proposed use of
proceeds of such Borrowing; provided that each Borrowing shall
be in an aggregate amount of not less than $1,000,000 or an
integral multiple of $1,000,000 in excess thereof. Each Notice
of Borrowing shall be irrevocable and binding on the Borrower.
(b) The Borrower may not request more than four Borrowings in any
month.
(c) Funding of Borrowings.
15
(a) Funding by Lenders. Each Lender shall, before 11:00 A.M. (New
York City time) on the date of the proposed Borrowing, make
available to the Administrative Agent at its address referred
to in Section 11.01, in immediately available funds, such
Lender's Ratable Portion of such proposed Borrowing. After the
Administrative Agent's receipt of such funds and upon
fulfillment of the applicable conditions set forth in Article
III, the Administrative Agent will make such funds available
to the Borrower.
(b) Presumption by the Administrative Agent. Unless the
Administrative Agent shall have received notice from a Lender
prior to the date of any proposed Borrowing that such Lender
will not make available to the Administrative Agent such
Lender's Ratable Portion of such Borrowing, the Administrative
Agent may assume that such Lender has made such Ratable
Portion available to the Administrative Agent on the date of
such Borrowing in accordance with this Section 2.03, and the
Administrative Agent may, in reliance upon such assumption,
make available to the Borrower on such date a corresponding
amount. If and to the extent that such Lender shall not have
so made such Ratable Portion available to the Administrative
Agent, such Lender and the Borrower severally agree to repay
to the Administrative Agent forthwith on demand such
corresponding amount together with interest thereon, for each
day from the date such amount is made available to the
Borrower until the date such amount is repaid to the
Administrative Agent, at (i) in the case of the Borrower, the
interest rate applicable at the time to the Loans comprising
such Borrowing and (ii) in the case of such Lender, the
Federal Funds Rate. If such Lender shall repay to the
Administrative Agent such corresponding amount, such amount so
repaid shall constitute such Lender's Loan as part of such
Borrowing for purposes of this Agreement. If the Borrower
shall repay to the Administrative Agent such corresponding
amount, such payment shall not relieve such Lender of any
obligation it may have to the Borrower hereunder.
(c) The failure of any Lender to make the Loan to be made by it
as part of any Borrowing shall not relieve any other Lender
of its obligation, if any, hereunder to make its Loan on the
date of such Borrowing, but no Lender shall be responsible
for the failure of any other Lender to make the Loan to be
made by such other Lender on the date of any Borrowing.
(d) Repayment.
The Borrower shall repay the entire unpaid principal amount
of the Loans on the Maturity Date.
16
(e) Prepayments.
(a) Optional Prepayments. The Borrower may, upon at least one
Business Day's prior notice to the Administrative Agent,
stating the proposed date and aggregate principal amount of
the prepayment, prepay the outstanding principal amount of the
Loans in whole or ratably in part, together with accrued
interest to the date of such prepayment on the principal
amount prepaid; provided, however, that each partial
prepayment shall be in an aggregate principal amount not less
than $1,000,000 or integral multiples of $1,000,000 in excess
thereof. Upon the giving of such notice of prepayment, the
principal amount of the Loans specified to be prepaid shall
become due and payable on the date specified for such
prepayment.
(b) Mandatory Prepayments.
(a) If at any time the aggregate principal amount of
Loans outstanding shall exceed the aggregate
Commitments, the Borrower shall immediately prepay
the Loans then outstanding in an amount equal to such
excess together with accrued interest thereon.
(b) The Borrower shall prepay the Loans in an amount
equal to the Net Cash Proceeds of any Divestiture
completed in accordance with Section 6.03(b), within
one Business Day after receipt of such Net Cash
Proceeds.
(f) Notes.
The obligation of the Borrower to repay the Loans made by each Lender
and to pay interest thereon at the rates provided herein shall be further
evidenced by a promissory note, substantially in the form of Exhibit A (each, a
"Note" and collectively, the "Notes"), payable to the order of such Lender and
in the principal amount of such Lender's initial Commitment. The Borrower
authorizes each Lender to record on the schedule annexed to such Lender's Note,
the date and amount of each Loan made by such Lender, and each payment or
prepayment of principal thereunder and agrees that all such notations shall
constitute prima facie evidence of the matters noted. The Borrower further
authorizes each Lender to attach to and make a part of such Lender's Note
continuations of the schedule attached thereto as necessary. No failure to make
any such notations, nor any errors in making any such notations, shall affect
the validity of the Borrower's obligations to repay the full unpaid principal
amount of the Loans and accrued interest thereon, or the duties of Borrower
hereunder or thereunder.
17
(g) Reduction and Expiration of Commitments.
(a) The Commitments shall expire on the last day of the
Availability Period if not utilized prior to such date.
(b) The Borrower may, upon at least five Business Days' prior
notice to the Administrative Agent, terminate in whole or
reduce ratably in part the unused portions of the respective
Commitments of the Lenders; provided, however, that each
partial reduction shall be in the aggregate amount of not less
than $1,000,000 or an integral multiple of $1,000,000 in
excess thereof.
(c) The Commitments shall be automatically and permanently reduced
by an amount equal to the amount of any prepayment required by
Section 2.05(b)(ii) in connection with any Divestiture to the
extent that the aggregate amount of Net Cash Proceeds received
from all Divestitures from and after the Closing Date exceeds
$500,000.
(h) Fees.
(a) Unused Commitment Fee. The Borrower agrees to pay to the
Administrative Agent, for the account of each Lender, an
unused commitment fee on the average daily unused portion of
such Lender's Commitment at the rate of 0.50% per annum,
payable in arrears on (i) the last day of each fiscal quarter
and (ii) the last day of the Availability Period.
(b) Up-Front Fee. The Borrower shall pay to the Administrative
Agent, for the account of each Lender party hereto on the date
hereof, on the Closing Date in immediately available funds, a
one-time, up-front fee equal to 3.0% of the aggregate
Commitments of all of the Lenders.
(c) Additional Commitment Fee. In the event a plan of
reorganization acceptable to the Lenders, the Bond Support
Lenders and the Bank Lenders has not been (i) confirmed within
five months after the Filing Date and/or (ii) consummated
within six months after the Filing Date, the Borrower shall
pay to the Administrative Agent, for the ratable account of
each Lender, on the first Business Day after such date, in
immediately available funds, a one-time fee equal to $900,000.
(d) Payment of Fees. All fees payable hereunder shall be paid on
the dates due, in immediately available funds, to the
Administrative Agent for distribution, in the case of the fees
set forth in clauses (a), (b) and (c), to the Persons entitled
thereto. Fees paid hereunder shall not be refundable under any
circumstances.
(i) Interest.
The Borrower shall pay interest on the unpaid principal amount of each
Loan from the date thereof until the principal amount thereof shall be paid in
full, at a rate per annum equal at all times to the Prime Rate in effect from
time to time plus 3.0% per annum, payable quarterly in arrears on the last day
of each fiscal quarter and on the date any Loan is or is to be paid or prepaid,
in whole or in part; provided, however, that during the continuance of an Event
of Default, all Loans shall bear interest, payable on demand, at a rate per
annum equal at all times to the Prime Rate then in effect plus 5.0% per annum.
The Administrative Agent shall give prompt notice to the Borrower and the
Lenders of the applicable interest rate determined by the Administrative Agent
for purposes of this Section 2.09.
(j) Capital Adequacy.
If after the date hereof, (a) the introduction of or any change in or
in the interpretation of any law or regulation, (b) compliance with any law or
regulation, or (c) compliance with any guideline or request from any central
bank or other Governmental Authority (whether or not having the force of law)
affects or would affect the
18
amount of capital required or expected to be maintained by any Lender or any
corporation controlling any Lender and such Lender reasonably determines that
such amount is based upon the existence of such Lender's Commitments, Loans and
its other commitments and loans of similar type, then, within ten Business Days
after demand by such Lender (with a copy of such demand to the Administrative
Agent), the Borrower shall pay to the Administrative Agent for the account of
such Lender, from time to time as specified by such Lender, additional amounts
sufficient to compensate such Lender in the light of such circumstances, to the
extent that such Lender reasonably determines such increase in capital to be
allocable to the existence of any or all of such Lender's Commitments and Loans.
A certificate containing reasonably detailed calculations of such amounts
submitted to the Borrower and the Administrative Agent by such Lender shall be
conclusive and binding for all purposes absent manifest error.
(k) Increased Costs.
If, due to either (a) the introduction of or any change in or in the
interpretation of any law or regulation or (b) compliance with any guideline or
request from any central bank or other Governmental Authority (whether or not
having the force of law), there shall be any increase in the cost to any Lender
of agreeing to make or making, funding or maintaining any Loans, then the
Borrower shall from time to time, within ten Business Days after demand by such
Lender (with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender additional amounts
sufficient to compensate such Lender for such increased cost. A certificate
containing reasonably detailed calculations of the amount of such increased
cost, submitted to the Borrower and the Administrative Agent by such Lender,
shall be conclusive and binding for all purposes, absent manifest error.
(l) Payments and Computations.
(a) The Borrower shall make each payment hereunder and under the
Notes not later than 11:00 A.M. (New York City time) on the
day when due, in Dollars, to the Administrative Agent at its
address referred to in Section 11.01 in immediately available
funds without set-off or counterclaim. The Administrative
Agent will promptly thereafter cause to be distributed
immediately available funds relating to the payment of
principal, interest or fees (other than amounts payable
pursuant to Sections 2.10, 2.11 and 2.13) to the Lenders, in
accordance with their respective Ratable Portions, and like
funds relating to the payment of any other amount payable to
any Lender to such Lender, in each case to be applied in
accordance with the terms of this Agreement. Payment received
by the Administrative Agent after 11:00 A.M. (New York City
time) shall be deemed to be received on the next Business Day.
(b) The Borrower hereby authorizes each Lender, if and to the
extent payment owed to such Lender is not made when due
hereunder or under any Loan held by such Lender, to charge
from time to time against any or all of the Borrower's
accounts with such Lender any amount so due.
(c) All computations of interest based on the Prime Rate or the
Federal Funds Rate and of fees shall be made by the
Administrative Agent on the basis of a year of 365 or 366
days, as the case may be, for the actual number of days
(including the first day but excluding the last day) occurring
in the period for which such interest or fees are payable.
Each determination by the Administrative Agent of an interest
rate hereunder shall be conclusive and binding for all
purposes, absent manifest error.
(d) Whenever any payment hereunder or under the Notes shall be
stated to be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day, and
such extension of time shall in such case be included in the
computation of payment of interest or fee, as the case may be.
(e) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is
due hereunder to the Lenders that the Borrower will not make
such payment in
19
full, the Administrative Agent may assume that the Borrower
has made such payment in full to the Administrative Agent on
such date, and the Administrative Agent may, in reliance upon
such assumption, cause to be distributed to each Lender on
such due date an amount equal to the amount then due such
Lender. If and to the extent the Borrower shall not have so
made such payment in full to the Administrative Agent, each
Lender shall repay to the Administrative Agent forthwith on
demand such amount distributed to such Lender together with
interest thereon, for each day from the date such amount is
distributed to such Lender until the date such Lender repays
such amount to the Administrative Agent, at the Federal Funds
Rate.
(m) Taxes.
(a) Any and all payments by the Borrower under each Credit
Document shall be made free and clear of and without deduction
for any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with
respect thereto, excluding, in the case of the Administrative
Agent, taxes measured by its net income and franchise taxes
(imposed in lieu of a tax on net income) imposed on it by each
jurisdiction under the laws of which the Administrative Agent
is organized or any political subdivision thereof and, in the
case of each Lender, taxes measured by its net income and
franchise taxes (imposed in lieu of a tax on net income)
imposed on it by each jurisdiction under the laws of which
such Lender is organized or any political subdivision thereof
(all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities being hereinafter
referred to as "Taxes"). If the Borrower shall be required by
law to deduct or withhold any Taxes from or in respect of any
sum payable hereunder to any Lender or the Administrative
Agent (i) the sum payable shall be increased as may be
necessary so that after making all required deductions or
withholdings (including, without limitation, deductions or
withholdings applicable to additional sums payable under this
Section 2.13) such Lender or the Administrative Agent, as the
case may be, receives an amount equal to the sum it would have
received had no such deductions or withholdings been made,
(ii) the Borrower shall make such deductions or withholdings,
and (iii) the Borrower shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority
in accordance with applicable law.
(b) In addition, the Borrower agrees to pay any present or future
stamp or documentary taxes or any other excise or property
taxes, charges or similar levies of any applicable
Governmental Authority which arise from any payment made under
any Credit Document or from the execution, delivery or
registration of, or otherwise with respect to, any Credit
Document (collectively, "Other Taxes").
(c) The Borrower will indemnify each Lender and the Administrative
Agent for the full amount of Taxes or Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed by any
jurisdiction on amounts payable under this Section 2.13) paid
by such Lender or the Administrative Agent, as the case may
be, and any liability (including, without limitation, for
penalties, interest and expenses) arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were
correctly or legally asserted. This indemnification shall be
made within 30 days from the date such Lender or the
Administrative Agent, as the case may be, makes written demand
therefor.
(d) Within 30 days after the date of any payment of Taxes or Other
Taxes, the Borrower will furnish to the Administrative Agent,
at its address referred to in Section 11.01, the original or a
certified copy of a receipt evidencing payment thereof.
(e) Without prejudice to the survival of any other agreement of
the Borrower hereunder, the agreements and obligations of the
Borrower contained in this Section 2.13 shall survive the
payment in full of the Obligations.
(f) Any Lender that is a United States person under Section
7701(a)(30) of the Code for U.S. Federal income tax purposes
shall deliver to the Borrower and the Administrative Agent at
the time or times
20
prescribed by applicable law or reasonably requested by the
Borrower a properly completed and executed Internal Revenue
Service Form W-9 (or any subsequent versions thereof or
successors thereto). Any Lender that is not a United States
person under Section 7701(a)(30) of the Code for U.S. Federal
income tax purposes that is entitled to an exemption from or
reduction of withholding tax under the laws of the United
States of America, or any treaty to which the United States of
America is a party, with respect to payments under any Credit
Document shall deliver to the Borrower and the Administrative
Agent, at the time or times prescribed by applicable law or
reasonably requested by the Borrower, 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.
(g) In those circumstances as shall be necessary under applicable
law to allow payments hereunder to be made free of (or at a
reduced rate of) United States withholding tax, at the written
request of the Borrower, the Administrative Agent shall
provide the Borrower with (i) two properly completed and
executed originals of IRS Form W-8IMY (or any subsequent
versions thereof or successors thereto) with respect to its
exemption from United States withholding tax because it is a
U.S. branch of a foreign bank and (ii) such documentation as
shall have been received from the Lenders by the
Administrative Agent but not the Borrower pursuant to
subparagraph (f) of this Section.
(n) Sharing of Payments, Etc.
If any Lender shall obtain any payment (whether voluntary, involuntary,
through the exercise of any right of set-off, or otherwise) on account of the
Loans made by it (other than pursuant to Section 2.10, 2.11, or 2.13) in excess
of its Ratable Portion of payments on account of the Loans obtained by all the
Lenders, such Lender shall forthwith purchase from the other Lenders such
participations in their Loans as shall be necessary to cause such purchasing
Lender to share the excess payment ratably with each of them; provided, however,
that if all or any portion of such excess payment is thereafter recovered from
such purchasing Lender, such purchase from each Lender shall be rescinded, and
such Lender shall repay to the purchasing Lender the purchase price to the
extent of such recovery together with an amount equal to such Lender's ratable
share (according to the proportion of (a) the amount of such Lender's required
repayment to (b) the total amount so recovered from the purchasing Lender) of
any interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. The Borrower agrees that any Lender so
purchasing a participation from another Lender pursuant to this Section 2.14
may, to the fullest extent permitted by law, exercise all its rights of payment
(including, without limitation, the right of set-off) with respect to such
participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation.
Item 42.
CONDITIONS
(a) Conditions Precedent to Initial Loans.
The obligation of each Lender to make its initial Loan on the Closing
Date is subject to satisfaction of all of the following conditions precedent:
21
(a) Certain Documents. The Administrative Agent shall have
received, on the Closing Date, the following, each dated the
Closing Date unless otherwise indicated, in form and substance
satisfactory to the Administrative Agent and (except for the
Notes) in sufficient copies for each Lender:
(a) From each party hereto either (A) a counterpart of
this Agreement signed on behalf of such party or (B)
written evidence satisfactory to the Administrative
Agent (which may include telecopy transmission of a
signed signature page to this Agreement) that such
party has signed a counterpart of this Agreement.
(b) The Notes to the order of the Lenders, respectively,
duly executed by the Borrower.
(c) Copies of each of the Financing Agreements.
(d) The Pledge Agreement, duly executed by the respective
parties thereto, together with evidence that all
action necessary or, in the opinion of the
Administrative Agent, desirable to perfect and
protect the Lien created by the Pledge Agreement has
been taken.
(e) The Security Agreement, duly executed by the
respective parties thereto, together with evidence
that all action necessary or, in the opinion of the
Administrative Agent, desirable to perfect the Liens
created by the Security Agreement has been taken.
(f) A favorable written opinion (addressed to the
Administrative Agent and the Lenders and dated the
Closing Date) of (A) Xxxxxxx Xxxx & Xxxxxxxxx,
counsel for the Credit Parties, in form and substance
satisfactory to the Lenders and the Administrative
Agent (and the Credit Parties hereby instruct such
counsel to deliver such opinion to the Administrative
Agent and the Lenders) and (B) the general counsel of
the Credit Parties, in form and substance
satisfactory to the Lenders and the Administrative
Agent (and the Credit Parties hereby instruct such
general counsel to deliver such opinion to the
Administrative Agent and the Lenders).
(g) Copies of (A) the audited consolidated and
consolidating balance sheets for the members of the
Consolidated Group as of December 31, 2000, and the
related audited consolidated and consolidating
statements of operations, shareholders' equity, and
cash flows for the fiscal year ending as of such date
and (B) the unaudited consolidated balance sheet of
the Consolidated Group as of June 30, 2000, and the
related unaudited statements of operations and cash
flows for the six-month period ending as of such
date.
(h) Receipt by the Administrative Agent of the following
(or their equivalent) for each of the Credit Parties,
certified by a secretary or assistant secretary as of
the Closing Date to be true and correct and in force
and effect as of such date:
RESOLUTIONS. COPIES OF RESOLUTIONS OF THE BOARD OF DIRECTORS APPROVING AND
ADOPTING THE RESPECTIVE CREDIT DOCUMENTS, THE TRANSACTIONS CONTEMPLATED THEREBY
AND AUTHORIZING EXECUTION AND DELIVERY THEREOF. ORGANIZATIONAL DOCUMENTS. COPIES
OF THE ORGANIZATIONAL DOCUMENTS OF EACH CREDIT PARTY. INCUMBENCY CERTIFICATE. A
CERTIFICATE OF THE SECRETARY OR AN ASSISTANT SECRETARY OF EACH CREDIT PARTY
CERTIFYING THE NAMES AND TRUE SIGNATURES OF EACH OFFICER OF SUCH CREDIT PARTY
WHO HAS BEEN AUTHORIZED TO EXECUTE AND DELIVER ANY CREDIT DOCUMENT OR OTHER
DOCUMENT REQUIRED HEREUNDER TO BE EXECUTED AND DELIVERED BY OR ON BEHALF OF SUCH
CREDIT PARTY.
(i) Copies, where applicable, of (A) certificates of good
standing, existence or its equivalent certified as of
a recent date by the appropriate Governmental
Authorities of the state of incorporation and (B)
certificates indicating payment of all corporate
franchise taxes certified as of a recent date by the
appropriate governmental taxing authorities of the
state of incorporation.
22
(j) Officer's Certificate Regarding Conditions Precedent.
A certificate, signed by a Responsible Officer of the
Borrower, stating that each of the conditions
specified in Sections 3.02(a) and 3.02(b) has been
satisfied.
(k) Officer's Certificate Regarding Representations and
Warranties. A certificate, signed by a Responsible
Officer of the Borrower, with respect to the
additional representations and warranties to be made
by the Credit Parties on the Closing Date.
(l) Other Documents and Information. Such additional
documents, information and materials as any Lender,
through the Administrative Agent, may reasonably
request.
(b) Fees and Expenses. All costs and accrued and unpaid fees and
expenses (including, without limitation, reasonable legal fees
and expenses) required to be paid to the Lenders and the
Administrative Agent on or before the Closing Date, including,
without limitation, those referred to in Sections 2.08 and
11.05, to the extent then due and payable, shall have been
paid.
(c) Absence of Legal Proceedings. The absence of any action, suit,
investigation or proceeding (other than the Bankruptcy Cases)
pending in any court or before any arbitrator or governmental
instrumentality which could reasonably be expected to have a
Material Adverse Effect.
(d) DIP Financing Orders. Receipt by the Administrative Agent of
evidence satisfactory to the Administrative Agent, in its sole
discretion, that the Interim DIP Financing Order has been
entered by the Bankruptcy Court and docketed by the Clerk of
the Bankruptcy Court, and that such order is in full force and
effect and has not been vacated, reversed, modified, amended,
or stayed pending appeal.
(e) Motions, Etc. The Lenders and the Administrative Agent shall
have reviewed and found satisfactory all motions, orders and
other pleadings or related documents to be filed or submitted
to the Bankruptcy Court in connection with this Agreement and
the Bankruptcy Cases.
(f) Initial Transit Budgets. Receipt by the Administrative Agent
of the Initial Transit Budget, in form, scope and substance
satisfactory to the Administrative Agent in its sole
discretion.
(g) Due Diligence. The Lenders shall have completed a satisfactory
due diligence review of the Credit Parties.
(h) No Material Adverse Change. Since the Filing Date, there has
been no event, condition or change that, individually or in
the aggregate, could reasonably be expected to have a Material
Adverse Effect (and if requested by the Administrative Agent,
the Borrower shall deliver a certificate to such effect from a
Responsible Officer of the Borrower).
(b) Conditions Precedent to Each Loan.
The obligation of each Lender to make any Loan (including the Loan
being made by such Lender on the Closing Date) shall be subject to the further
conditions precedent that:
23
(a) Accuracy of Certain Statements. The following statements shall
be true on the date of such Loan, before and after giving
effect thereto, and to the application of the proceeds
therefrom (and the acceptance by the Borrower of the proceeds
of such Loan shall constitute a representation and warranty by
the Borrower that on the date of such Loan such statements are
true):
(a) The representations and warranties of the Credit
Parties contained in Article IV of this Agreement and
in the other Credit Documents are true and correct on
and as of such date as though made on and as of such
date (unless such representations and warranties are
made as of another date, in which case they shall be
true and correct as of such date); and
(b) No Default or Event of Default has occurred and is
continuing or will result from the Loans being made
on such date.
(b) No Violation of Law or Injunction.
The making of the Loans on such date does not violate any Requirement
of Law and is not enjoined, temporarily, preliminarily or permanently.
(c) DIP Financing Orders.
Either the Interim DIP Financing Order or Final DIP Financing Order
shall be in full force and effect and shall not have been vacated, reversed,
modified, amended or stayed (except to the extent that the Interim DIP Financing
Order is replaced and superseded by the Final DIP Financing Order) and shall be
in form and substance satisfactory to the Administrative Agent.
(d) No Order of Bankruptcy.
No order of the Bankruptcy Court shall have been entered (i)
authorizing the Credit Parties to borrow money pursuant to section 364 of the
Bankruptcy Code from any Person (other than the Lenders pursuant to this
Agreement or otherwise) or to obtain any other credit from any Person secured by
a Lien on any of the assets of the Credit Parties pursuant to sections 364(c) or
(d) of the Bankruptcy Code, or (ii) affording any creditor adequate protection
under sections 361 through 364 of the Bankruptcy Code by granting a Lien in any
Collateral, unless the Lenders consent to such a Lien or such Lien is junior and
expressly subordinated in all respects to the Liens of the Administrative Agent
in the Collateral.
(e) Expiration of Interim Period.
The obligation of the Lenders to extend credit under this Agreement
after the Interim Period expires shall be subject to the further condition
precedent that, in addition to the conditions set forth in this Section 3.02,
the Administrative Agent shall have received evidence, satisfactory to the
Administrative Agent, that the Final DIP Financing Order has been entered by the
Bankruptcy Court and docketed by the Clerk of the Bankruptcy Court, and that
such order (i) shall be in full force and effect, (ii) shall provide that the
Credit Parties are prohibited from asserting any claims against the Collateral
pursuant to 11 U.S.C. ss. 506(c) (except as provided in the Carve Out and as
agreed to by the Lenders) and (iii) shall not have been vacated, reversed,
modified, amended or stayed pending appeal.
Item 43.
REPRESENTATIONS AND WARRANTIES
To induce the Lenders and the Administrative Agent to enter into this
Agreement, each of the Credit Parties hereby represents and warrants to the
Administrative Agent and to each Lender that:
24
(a) Financial Condition.
Each of the financial statements described below (copies of which have
heretofore been provided to the Administrative Agent for distribution to the
Lenders), have been prepared in accordance with GAAP consistently applied
throughout the periods covered thereby, are complete and correct in all material
respects and present fairly the financial condition and results from operations
of the entities and for the periods specified (subject in the case of interim
company-prepared statements to normal year-end adjustments and the absence of
footnotes):
(a) audited consolidated and consolidating balance sheets for the
members of the Consolidated Group for the fiscal years ended
December 31, 1999 and December 31, 2000, together with related
audited consolidated and consolidating statements of
operations, shareholders equity and cash flows for such fiscal
years, in each case certified by Xxxxxx Xxxxxxxx LLP,
certified public accountants; and
(b) after the Closing Date, the annual and quarterly financial
statements provided in accordance with Sections 5.01(a) and
5.01(b).
(b) No Changes or Restricted Payments.
Since December 31, 2000, (a) except as set forth on Schedule 4.02 and
other than the commencement of the Bankruptcy Cases, there has been no
circumstance, development or event relating to or affecting the members of the
Transit Group which has had or would be reasonably expected to have a Material
Adverse Effect, and (b) except as permitted herein, no Restricted Payments have
been made or declared by any Credit Party.
(c) Organization; Existence; Compliance with Law.
Each of the Credit Parties (a) is duly organized, validly existing and
in good standing under the laws of the jurisdiction of its incorporation or
organization, (b) has the corporate or other necessary power and authority, and
the legal right to own and operate its property, to lease the property it
operates as lessee and to conduct the business in which it is currently engaged,
(c) is duly qualified as a foreign entity and in good standing under the laws of
each jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification, other than in such
jurisdictions where the failure to be so qualified or in good standing would
not, in the aggregate, have a Material Adverse Effect, and (d) is in compliance
with its Certificate of Incorporation and Bylaws (or other organizational or
governing documents) and all Requirements of Law, except to the extent that the
failure to comply therewith would not, in the aggregate, be reasonably expected
to have a Material Adverse Effect.
25
(d) Power; Authorization; Enforceable Obligations.
(a) Subject to the entry of the DIP Financing Order, each of the
Credit Parties has the corporate or other necessary power and
authority, and the legal right, to execute, make, deliver and
perform the Credit Documents to which it is a party and has
taken all necessary corporate or other action to authorize the
execution, delivery and performance by it of the Credit
Documents to which it is a party.
(b) Subject to the entry of the DIP Financing Order, the
execution, delivery and performance by each Credit Party of
the Credit Documents to which it is a party and the
consummation of the transactions contemplated thereby do not
and will not (i) contravene such Person's Certificate of
Incorporation or Bylaws or other comparable governing
documents, (ii) violate any other applicable Requirement of
Law (including, without limitation, Regulations T, U and X of
the Board of Governors of the Federal Reserve System), or any
order or decree of any Governmental Authority or arbitrator,
(iii) result in the creation or imposition of any Lien upon
any of the property of such Person or any of its Subsidiaries,
other than those in favor of the Administrative Agent pursuant
hereto and the Collateral Documents or (iv) violate or
conflict with any order, writ, judgment, injunction, decree or
permit applicable to any Credit Party.
(c) Except for the entry of each of the DIP Financing Orders, no
consent or authorization of, filing with, notice to or other
act by or in respect of, any Governmental Authority or any
other Person is required in connection with acceptance of the
Loans or the making of the guaranties hereunder or with the
execution, delivery or performance of any Credit Documents by
the Credit Parties (other than (i) those which have been
obtained and are in full force and effect, (ii) such filings
as are required by the Securities and Exchange Commission and
(iii) other filings necessary to fulfill other reporting
requirements with Governmental Authorities) or with the
validity or enforceability of any Credit Document against the
Credit Parties (except such filings as are necessary in
connection with the perfection of the Liens created by such
Credit Documents).
(d) Subject to the entry of the DIP Financing Order, each Credit
Document to which it is a party constitutes a legal, valid and
binding obligation of such Credit Party enforceable against
such Credit Party in accordance with its terms without
defense, setoff or counterclaim.
(e) [Reserved.]
(f) No Material Litigation.
No claim, litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the best knowledge of the
Credit Parties, threatened by or against, any Credit Party or against any of the
Facilities or revenues which (a) purports to affect the legality, validity or
enforceability of any of the Credit Documents or (b) is reasonably likely to
have a Material Adverse Effect.
(g) No Default.
No Default or Event of Default has occurred and is continuing.
(h) Ownership of Property; Liens.
Each of the Credit Parties has good record and marketable title in fee
simple to, or a valid leasehold interest in, all its real property material to
the Credit Parties taken as a whole, and good title to, or a valid leasehold
interest in, all its other property material to the Credit Parties taken as a
whole, and none of such property is subject to any Lien, except for Permitted
Liens.
26
(i) Intellectual Property.
Each Credit Party owns, or has the legal right to use, the Intellectual
Property necessary for it to conduct its business as currently conducted, except
to the extent the failure to do so would not be reasonably expected to have a
Material Adverse Effect. No claim has been asserted and is pending by any Person
challenging or questioning the use of any such Intellectual Property or the
validity or effectiveness of any such Intellectual Property, nor does any Credit
Party know of any such claim, and the use of such Intellectual Property by the
Credit Parties does not infringe on the rights of any Person, except for such
claims and infringements that in the aggregate, would not be reasonably expected
to have a Material Adverse Effect.
(j) No Burdensome Restrictions.
Neither the Certificate of Incorporation or Bylaws (or other
organizational or governing documents) nor any Requirement of Law of any Credit
Party would be reasonably expected to have a Material Adverse Effect.
(k) Taxes.
Each Credit Party has filed all post-petition federal and other tax
returns and material reports required to be filed, and has paid all
post-petition federal and other taxes, assessments, fees and other governmental
charges levied or imposed upon it or its Facilities, income or assets otherwise
due and payable unless such unpaid taxes and assessments are (a) not yet past
due or (b) being contested in good faith and by appropriate proceedings
diligently pursued and as to which adequate reserves determined in accordance
with GAAP have been established on such Credit Party's books and records and no
Lien with respect to nonpayment thereof has been asserted. No Credit Party is
aware of any proposed tax assessments against it, with respect to any prior
period, in excess of amounts accrued on its financial statements (as required to
be accrued in accordance with GAAP), nor does any Credit Party anticipate any
further material tax liability with respect to any open taxable years taken as a
whole in excess of accrued amounts.
(l) ERISA.
Except as would not reasonably be expected to have a Material Adverse
Effect:
(a) During the five-year period prior to the date on which this
representation is made or deemed made: (i) no ERISA Event has
occurred, and, to the best knowledge of the Credit Parties, no
event or condition has occurred or exists as a result of which
any ERISA Event could reasonably be expected to occur, with
respect to any Plan; (ii) no "accumulated funding deficiency,"
as such term is defined in Section 302 of ERISA and Section
412 of the Internal Revenue Code, whether or not waived, has
occurred with respect to any Plan; (iii) each Plan has been
maintained, operated, and funded in compliance with its own
terms and in material compliance with the provisions of ERISA,
the Internal Revenue Code, and any other applicable federal or
state laws; and (iv) no lien in favor of the PBGC or a Plan
has arisen or is reasonably likely to arise on account of any
Plan.
(b) The actuarial present value of all "benefit liabilities" (as
defined in Section 4001(a)(16) of ERISA), whether or not
vested, under each Single Employer Plan, as of the last annual
valuation date prior to the date on which this representation
is made or deemed made (determined, in each case, in
accordance with Financial Accounting Standards Board Statement
87, utilizing the actuarial assumptions used in such Plan's
most recent actuarial valuation report), did not exceed as of
such valuation date the fair market value of the assets of
such Plan.
(c) Neither any Credit Party nor any ERISA Affiliate has incurred,
or, to the best knowledge of the Credit Parties, could be
reasonably expected to incur, any withdrawal liability under
ERISA to any Multiemployer Plan or Multiple Employer Plan.
Neither any Credit Party nor any ERISA Affiliate would become
subject to any withdrawal liability under ERISA if any Credit
Party or any ERISA
27
Affiliate were to withdraw completely from all Multiemployer
Plans and Multiple Employer Plans as of the valuation date
most closely preceding the date on which this representation
is made or deemed made. Neither any Credit Party nor any ERISA
Affiliate has received any notification that any Multiemployer
Plan is in reorganization (within the meaning of Section 4241
of ERISA), is insolvent (within the meaning of Section 4245 of
ERISA), or has been terminated (within the meaning of Title IV
of ERISA), and no Multiemployer Plan is, to the best knowledge
of the Credit Parties, reasonably expected to be in
reorganization, insolvent, or terminated.
(d) No prohibited transaction (within the meaning of Section 406
of ERISA or Section 4975 of the Internal Revenue Code) or
breach of fiduciary responsibility has occurred with respect
to a Plan which has subjected or may subject any Credit Party
or any ERISA Affiliate to any liability under Sections 406,
409, 502(i), or 502(l) of ERISA or Section 4975 of the
Internal Revenue Code, or under any agreement or other
instrument pursuant to which any Credit Party or any ERISA
Affiliate has agreed or is required to indemnify any person
against any such liability.
(e) Neither any Credit Party nor any ERISA Affiliates has any
material liability with respect to "expected post-retirement
benefit obligations" within the meaning of the Financial
Accounting Standards Board Statement 106. Each Plan which is a
welfare plan (as defined in Section 3(1) of ERISA) to which
Sections 601-609 of ERISA and Section 4980B of the Internal
Revenue Code apply has been administered in compliance in all
material respects of such sections.
(f) Neither the execution and delivery of this Agreement nor the
consummation of the financing transactions contemplated
thereunder will involve any transaction which is subject to
the prohibitions of Sections 404, 406 or 407 of ERISA or in
connection with which a tax could be imposed pursuant to
Section 4975 of the Internal Revenue Code. The representation
by the Credit Parties in the preceding sentence is made in
reliance upon and subject to the accuracy of the Lenders'
representation in Section 11.15 with respect to their source
of funds and is subject, in the event that the source of the
funds used by the Lenders in connection with this transaction
is an insurance company's general asset account, to the
application of Prohibited Transaction Class Exemption 95-60,
60 Fed. Reg. 35,925 (1995), compliance with the regulations
issued under Section 401(c)(1)(A) of ERISA, or the issuance of
any other prohibited transaction exemption or similar relief,
to the effect that assets in an insurance company's general
asset account do not constitute assets of an "employee benefit
plan" within the meaning of Section 3(3) of ERISA or a "plan"
within the meaning of Section 4975(e)(1) of the Internal
Revenue Code.
(m) Governmental Regulations, Etc.
(a) No part of the proceeds of the Loans hereunder will be used,
directly or indirectly, for the purpose of purchasing or
carrying any "margin stock" within the meaning of Regulation
U. If requested by any Lender or the Administrative Agent, the
Borrower will furnish to the Administrative Agent and each
Lender a statement to the foregoing effect in conformity with
the requirements of FR Form U-1 referred to in said Regulation
U. No Indebtedness being reduced or retired out of the
proceeds of the Loans hereunder was or will be incurred for
the purpose of purchasing or carrying any margin stock within
the meaning of Regulation U or any "margin security" within
the meaning of Regulation T. "Margin stock" within the
meanings of Regulation U does not constitute more than 25% of
the value of the consolidated assets of the Borrower and its
Subsidiaries. None of the transactions contemplated by this
Agreement (including, without limitation, the direct or
indirect use of the proceeds of the Loans) will violate or
result in a violation of the Securities Act of 1933, as
amended or the Exchange Act, or regulations issued pursuant
thereto, or Regulation T, U or X.
(b) The Borrower will not use any proceeds of the Loans for any
purpose that is improper under the Bankruptcy Code.
28
(c) No Credit Party is subject to regulation under the Public
Utility Holding Company Act of 1935, the Federal Power Act or
the Investment Company Act of 1940, each as amended. In
addition, no Credit Party is (i) an "investment company"
registered or required to be registered under the Investment
Company Act of 1940, as amended, and is not controlled by such
a company, or (ii) a "holding company", or a "subsidiary
company" of a "holding company", or an "affiliate" of a
"holding company" or of a "subsidiary" of a "holding company",
within the meaning of the Public Utility Holding Company Act
of 1935, as amended.
(d) No director, executive officer or principal shareholder of any
Credit Party is a director, executive officer or principal
shareholder of any Lender. For the purposes hereof the terms
"director", "executive officer" and "principal shareholder"
(when used with reference to any Lender) have the respective
meanings assigned thereto in Regulation O.
(n) Subsidiaries and Guarantors.
(a) Set forth on Schedule 4.14(a) are all of the Subsidiaries of
the Borrower at the Closing Date, the jurisdiction of their
incorporation and the direct or indirect ownership interest of
the Borrower therein.
(b) Set forth on Schedule 4.14(b) are all of the Guarantors at the
Closing Date. Each Guarantor is a member of the Transit Group.
The Borrower has no Domestic Subsidiaries that are in the
"transit" segment of the Borrower's business other than the
Guarantors.
(o) Use of Proceeds.
(a) The proceeds of the Loans made hereunder shall be used by the
Borrower for the members off the Transit Group solely:
(a) to pay the payables owed by any member of the Transit
Group that have been approved by the Administrative
Agent, the Bond Support Administrative Agent and
Travelers;
(b) to pay the payables related to the Cass County
Contract and the payables with respect to contracts
identified by the Bank Administrative Agent to the
Administrative Agent within 30 days after the Filing
Date; provided, that (A) the Bank Administrative
Agent may identify no more than three such additional
contracts (such additional contracts, together with
the Cass County Contract, the "Specified Contracts")
and (B) the aggregate estimated loss of those
additional contracts (as determined by the most
recent good faith calculation by the Borrower's
management at the time of identification of such
contract by the Bank Administrative Agent) shall not
exceed $1,868,000;
(c) to repay the Indebtedness of the Borrower outstanding
under the Emergency Loan for costs incurred by the
members of the Transit Group; and
(d) to pay the fees payable pursuant to the terms hereof
and the Bond Support Credit Agreement;
(e) to fund the Expense Account;
(f) for general working capital purposes (including
payment of up to fifty-eight percent (58%) of General
Corporate Overhead Expenses and General Restructuring
Costs of the Borrower);
in each case in accordance with the Transit Budget most recently
delivered to the Administrative Agent and the Lenders pursuant to Section
5.01(d)(iv) (subject to the variance permitted under Section 6.12).
29
(b) None of the proceeds of the Loans may be used by the Borrower
to amortize, repay or prepay any Indebtedness of the Borrower
or any of its Subsidiaries or Affiliates for borrowed money,
other than the Emergency Loan or as provided in Section
4.15(a)(i).
(c) No proceeds of the Loans or the Collateral will be used by the
Borrower or any other Person (including, without limitation,
any statutory committee appointed in the Bankruptcy Cases) to
(i) object to or contest in any manner, or raise any defenses
to, the validity, extent, perfection, priority or
enforceability of the Obligations, the Liens granted to the
Administrative Agent and the Lenders under this Agreement and
the Collateral Documents or any other rights or interests of
the Administrative Agent and the Lenders under this Agreement
and the other Credit Documents or (ii) assert any claims or
causes of action, including, without limitation, any actions
under Chapter 5 of the Bankruptcy Code, against the
Administrative Agent and/or the Lenders.
(p) Environmental Matters.
Except as would not reasonably be expected to have a Material Adverse
Effect:
30
(a) Each of the facilities and Properties owned, leased or
operated by any Credit Party (the "Facilities") and all
operations at the Facilities are in compliance with all
applicable Environmental Laws, and there is no violation of
any Environmental Law with respect to the Facilities or the
businesses operated by any Credit Party (the "Businesses"),
and there are no conditions relating to the Businesses or
Facilities that could give rise to liability under any
applicable Environmental Laws.
(b) None of the Facilities contains, or has previously contained,
any Materials of Environmental Concern at, on or under the
Facilities in amounts or concentrations that constitute or
constituted a violation of, or could give rise to liability
under, Environmental Laws.
(c) No Credit Party has received any written or verbal notice of,
or inquiry from any Governmental Authority regarding, any
violation, alleged violation, non-compliance, liability or
potential liability regarding environmental matters or
compliance with Environmental Laws with regard to any of the
Facilities or the Businesses, nor does any Credit Party have
knowledge or reason to believe that any such notice will be
received or is being threatened.
(d) Materials of Environmental Concern have not been transported
or disposed of from the Facilities, or generated, treated,
stored or disposed of at, on or under any of the Facilities or
any other location, in each case by or on behalf any Credit
Party in violation of, or in a manner that would be reasonably
likely to give rise to liability under, any applicable
Environmental Law.
(e) No judicial proceeding or governmental or administrative
action is pending or, to the best knowledge of any Credit
Party, threatened, under any Environmental Law to which any
Credit Party is or will be named as a party, nor are there any
consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative
or judicial requirements outstanding under any Environmental
Law with respect to Credit Party, the Facilities or the
Businesses.
(f) There has been no release or, threat of release of Materials
of Environmental Concern at or from the Facilities, or arising
from or related to the operations (including, without
limitation, disposal) of any Credit Party in connection with
the Facilities or otherwise in connection with the Businesses,
in violation of or in amounts or in a manner that could give
rise to liability under Environmental Laws.
(q) Disclosure.
(a) Neither this Agreement, any of the financial statements
delivered to the Administrative Agent and/or the Lenders, any
other document, certificate or statement furnished to the
Administrative Agent and/or Lenders (with the exception of
budgets and projections) nor any of the information delivered
in writing to the Bankruptcy Court by or on behalf of any
Credit Party in connection with the transactions contemplated
hereby contains any untrue statement of a material fact or
omits to state a material fact necessary in order to make the
statements contained therein or herein not misleading.
(b) The budget and projections furnished to the Administrative
Agent and/or the Lenders by or on behalf of any Credit Party
in connection with the transactions contemplated hereby have
been prepared in good faith on the basis of reasonable
assumptions.
(r) Bank Accounts.
Schedule 4.18 contains a complete and accurate list of all bank
accounts maintained by the Credit Parties with any bank or other financial
institution.
31
(s) Insurance.
All policies of insurance of any kind or nature owned by or issued to
any Credit Party, including, without limitation, policies of life, fire, theft,
product liability, public liability, property damage, other casualty, employee
fidelity, workers' compensation and employee health and welfare insurance, are
(a) in full force and effect, (b) to the Credit Parties' knowledge, sufficient,
and (c) of a nature and provide such coverage as is customarily carried by
companies of the size and character of such Person.
(t) Labor Matters.
(a) There are no strikes, work stoppages, slowdowns or lockouts
pending or, to the Credit Parties' knowledge, threatened
against or involving any Credit Party, other than those which
in the aggregate have no Material Adverse Effect.
(b) There are no arbitrations or grievances pending against or
involving any Credit Party, nor are there any arbitrations or
grievances, to any Credit Party's knowledge, threatened
involving any Credit Party, other than those which, in the
aggregate, if resolved adversely to a Credit Party, would have
no Material Adverse Effect.
(c) There is no organizing activity involving any Credit Party
pending or, to any Credit Party's knowledge, threatened by any
labor union or group of employees, other than those which in
the aggregate have no Material Adverse Effect. There are no
representation proceedings pending or, to any Credit Party's
knowledge, threatened with the National Labor Relations Board,
and no labor organization or group of employees of any Credit
Party has made a pending demand for recognition, other than
those which in the aggregate have no Material Adverse Effect.
(d) There are no unfair labor practices charges, grievances or
complaints pending or in process or, to each Credit Party's
knowledge, threatened by or on behalf of any employee or group
of employees of any Credit Party, other than those which in
the aggregate, if adversely determined, would have no Material
Adverse Effect.
(e) There are no complaints or charges against any Credit Party
pending or, to each Credit Party's knowledge, threatened to be
filed with any Federal, state, local or foreign court,
governmental agency or arbitrator based on, arising out of, in
connection with, or otherwise relating to the employment by
any Credit Party of any individual, other than those which in
the aggregate, if resolved adversely, would have no Material
Adverse Effect.
(f) Each Credit Party is in compliance with all laws, and all
orders of any court, Governmental Authority or arbitrator,
relating to the employment of labor, including, without
limitation, all such laws relating to wages, hours, collective
bargaining, discrimination, civil rights, and the payment of
withholding and/or social security and similar taxes, except
for such non-compliances that in the aggregate have no
Material Adverse Effect.
Item 44.
AFFIRMATIVE COVENANTS
As long as any of the Obligations or Commitments remain outstanding,
each Credit Party agrees with the Lenders and the Administrative Agent that:
32
(a) Financial Statements.
The Borrower shall furnish, or cause to be furnished, to the
Administrative Agent and Lenders:
(a) Audited Consolidated Financial Statements. As soon as
available, but in any event within ninety-five (95) days after
the end of each fiscal year, an audited consolidated balance
sheet of the Consolidated Group as of the end of such fiscal
year and the related consolidated statements of operations,
shareholders' equity and cash flows for such fiscal year, all
prepared in conformity with GAAP and certified by Xxxxxx
Xxxxxxxx LLP, or other firm of independent certified public
accountants of nationally recognized standing reasonably
acceptable to the Majority Lenders, setting forth in each case
in comparative form the figures for the previous year.
(b) Quarterly Financial Statements. As soon as available and in
any event within forty-five (45) days after the end of each of
the first three fiscal quarters of each fiscal year, (i) a
consolidated balance sheet of the Consolidated Group as of the
end of such quarter, (ii) consolidated statements of income
and cash flows of the Consolidated Group, in each case for the
period commencing at the end of the previous fiscal year and
ending with the end of such fiscal quarter, all prepared in
conformity with GAAP and certified by the chief financial
officer of the Borrower as fairly presenting the financial
condition and results of operations of the Consolidated Group
at such date and for such period (subject to normal year-end
adjustments).
(c) Borrower-Prepared Financial Statements.
(a) Annual Transit Group Financial Statements.
As soon as available, but in any event within ninety-five (95) days
after the end of each fiscal year, a company-prepared consolidated balance sheet
of the Transit Group as of the end of such fiscal year and the related
consolidated statements of operations, shareholders' equity and cash flows for
the Transit Group for such fiscal year.
(b) Monthly Financial Statements.
Consolidated Group. As soon as available, but in any event within forty (40)
days after the end of the first calendar month ending after the Closing Date and
within thirty (30) days after the end of each subsequent calendar month,
company-prepared consolidated and consolidating balance sheets of the
Consolidated Group as of the end of such calendar month and related
company-prepared consolidated and consolidating statements of operations,
shareholders' equity and cash flows for such monthly period and for the fiscal
year to date, in each case setting forth in comparative form the consolidated
and consolidating figures for the corresponding period or periods of the
preceding fiscal year or the portion of the fiscal year ending with such period,
as applicable, in each case subject to normal year-end audit adjustments.
Transit Group. As soon as available, but in any event forty (40) days after the
end of the first calendar month ending after the Closing Date and within thirty
(30) days after the end of each subsequent calendar month, company-prepared
consolidated and consolidating balance sheets of the Transit Group as of the end
of such calendar month and related company-prepared consolidated and
consolidating statements of operations, shareholders' equity and cash flows for
the Transit Group such monthly period and for the fiscal year to date, in each
case setting forth in comparative form the consolidated and consolidating
figures for the corresponding period or periods of the preceding fiscal year or
the portion of the fiscal year ending with such period, as applicable, in each
case subject to normal year-end audit adjustments.
(c) Cash Flow Reports for Transit Group.
Forecast. A report, in a form acceptable to the Administrative Agent, that
includes a detailed cash flow projection (including the total amount of General
Corporate Overhead Expenses and General Restructuring Costs and the allocation
thereof) of the Transit Group for the then upcoming thirteen weeks, on a
consolidated and consolidating basis (each a "Forecast"), with (x) the initial
Forecast to be for the period from October 1, 2001 through December 31, 2001 and
to be delivered on or prior to October 11, 2001 and (y) each subsequent Forecast
to be for the thirteen
33
week period immediately following the end of the thirteen week period covered by
the prior Forecast and to be delivered at least ten (10) days prior to the
commencement of such thirteen week period; and Variance Analysis. Within four
(4) Business Days after the end of each week, a variance analysis (the "Variance
Analysis") reflecting a detailed comparison between actual cash flows for the
Transit Group through the end of the previous week on a consolidated and
consolidating basis and those projected for such period in the Initial Transit
Budget, the Second Transit Budget or the Transit Budget, as the case may be, for
such period, in each case in form reasonably acceptable to the Administrative
Agent, together with a certificate from a Responsible Officer of the Borrower
explaining any variances between the actual results from operations and the
amounts set forth in the corresponding budget.
(d) Accounts Payable Agings for Transit Group.
Concurrently with the delivery of the Forecast, a summary of the
accounts payable agings of the Transit Group in a form reasonably acceptable to
the Administrative Agent.
(e) Surety Claims.
Within five (5) Business Days of receipt, written notice of any
notification from any surety of any member of the Transit Group concerning
claims made against such surety in connection with any significant project of
such member of the Track Group, and, as soon as available, and in any event
within five (5) Business Days after the receipt of such notification, a copy of
any such notification.
(d) Borrower-Prepared Budgets and Reconciliations.
(a) [Reserved.]
(b) within twenty (20) days of the Filing Date, a
business analysis for the Transit Group in form,
scope and substance satisfactory to the
Administrative Agent that includes an evaluation of
all open bonded contracts with values in excess of
$50,000 (or such greater amount as determined by the
Administrative Agent in its sole discretion) and
details the cash flows of such bonded contracts (to
identify in particular negative cash flow contracts)
for the next year or thereafter;
(c) within thirty (30) days of the Closing Date, a
business analysis for the Transit Group in form,
scope and substance satisfactory to the
Administrative Agent that includes an evaluation of
all open non bonded contracts with values in excess
of $50,000 (or such greater amount as determined by
the Administrative Agent in its sole discretion) to
include a cash flow analysis of such non bonded
contracts (to identify in particular negative cash
flow contracts) for the next year or thereafter that
addresses the profitability of existing projects with
large cash requirements in the near term;
(d) itemized budgets for each member of the Transit Group
in form, scope and substance satisfactory to the
Administrative Agent in its sole discretion (each, a
"Transit Budget"), with (A) the initial Transit
Budget to be for the 45-day period immediately
following the Closing Date (the "Initial Transit
Budget") and to be delivered on or prior to the
Closing Date, (B) the subsequent Transit Budget to be
for the 45-day period immediately following the end
of the Initial Transit Budget period (the "Second
Transit Budget") and to be delivered at least 15 days
prior to the commencement of such 45-day period, and
(C) each subsequent Transit Budget to be for the
180-day period immediately following the end of the
previous budgeted period and to be delivered at least
15 days prior to the commencement of such 180-day
period;
(e) within forty (40) days after the end of the first
calendar month ending after the Closing Date and
within thirty (30) days after the end of each
subsequent calendar month, an itemized report
reconciling actual results from operations of each
member of the Transit Group for such calendar month
with the Borrower's original 2001 business plan or
the revised Business Plan
34
submitted and accepted by the Administrative Agent in
accordance with clause (vi) of this Section, as the
case may be, for such period, in each case in form
reasonably acceptable to the Administrative Agent,
together with a certificate from the chief financial
officer of the Borrower explaining any variances
between the actual results from operations and the
amounts set forth in the corresponding business plan;
and
(f) on or before December 1, 2001, a business plan for
the Consolidated Group in form, scope and substance
satisfactory to the Administrative Agent (the
"Business Plan").
All such financial statements and reports delivered pursuant to this
Section 5.01 shall be complete and correct in all material respects (subject, in
the case of interim statements, to normal year-end audit adjustments) and shall
be prepared in reasonable detail and, in the case of the annual and quarterly
financial statements provided in accordance with subsections (a) and (b) above,
in accordance with GAAP applied consistently throughout the periods reflected
therein and further accompanied by a description of, and an estimation of the
effect on the financial statements on account of, any change in the application
of accounting principles as provided in Section 1.03.
(b) Certificates; Other Information.
The Borrower shall furnish, or cause to be furnished, to the
Administrative Agent and the Lenders:
35
(a) Accountant's Certificate and Reports. Concurrently with the
delivery of the financial statements referred to in subsection
5.01(a) above, a certificate of the independent certified
public accountants reporting on such financial statements
stating that in the course of the regular audit of the
business of the Borrower and its Subsidiaries, which audit was
conducted by such accounting firm in accordance with generally
accepted auditing standards, such accounting firm has obtained
no knowledge that the Borrower is not in compliance with the
financial covenants set forth in Section 6.14 hereof, insofar
as such covenants relate to accounting matters, except as
specified in such certificate.
(b) Officer's Compliance Certificate. Concurrently with the
delivery of the financial statements referred to in Sections
5.01(b) and 5.01(c) above, a certificate of a Responsible
Officer, substantially in the form of Exhibit E, stating that,
to the best of such Responsible Officer's knowledge and
belief, (i) the financial statements fairly present in all
material respects the financial condition of the parties
covered by such financial statements, (ii) during such period
the Credit Parties have observed or performed in all material
respects the covenants and other agreements hereunder and
under the other Credit Documents relating to them, and
satisfied in all material respects the conditions contained in
this Agreement to be observed, performed or satisfied by them,
and (iii) such Responsible Officer has obtained no knowledge
of any Default or Event of Default, except as specified in
such certificate.
(c) Accountants' Reports. Promptly upon receipt, a copy of any
final (as distinguished from a preliminary or discussion
draft) "management letter" or other similar report submitted
by independent accountants or financial consultants to the
members of the Consolidated Group in connection with any
annual, interim or special audit or which refers in whole or
in part to any inadequacy, defect, problem, qualification or
other lack of fully satisfactory accounting controls utilized
by the Borrower or any of its Subsidiaries.
(d) Public Information. Within thirty days after the same are
sent, copies of all reports (other than those otherwise
provided pursuant to Section 5.01) and other financial
information which the Borrower sends to its public
stockholders, and within thirty days after the same are filed,
copies of all financial statements and non-confidential
reports which the Borrower may make to, or file with, the SEC.
(e) Bankruptcy Court Matters. Promptly, copies of all pleadings,
motions, applications, and other documents filed by any Credit
Party with the Bankruptcy Court or distributed by any Credit
Party to the office of the United States Trustee or to any
official committee of creditors or interest holders.
(f) Other Information. Promptly, such additional financial and
other information as the Administrative Agent, at the request
of any Lender, may from time to time reasonably request.
(c) Notices.
The Borrower shall give notice to the Administrative Agent (which shall
promptly transmit such notice to each Lender) of:
(a) Defaults. Immediately (and in any event within two (2) days)
after any Responsible Officer knows of the occurrence of any
Default or Event of Default.
(b) Contractual Obligations. Promptly (and in any event within ten
(10) days) after any Responsible Officer knows of the
occurrence of any default or event of default under any
Contractual Obligation of any Credit Party which would
reasonably be expected to have a Material Adverse Effect.
(c) Legal Proceedings. Promptly (and in any event within ten (10)
days) after any Responsible Officer knows of any litigation,
or any investigation or proceeding (including without
limitation, any environmental proceeding), or any material
development in respect thereof, affecting any Credit
36
Party which, if adversely determined, would reasonably be
expected to have a Material Adverse Effect.
(d) ERISA. Promptly (and in any event within thirty (30) days)
after any Responsible Officer knows or has reason to know of
(i) any event or condition, including, but not limited to, any
Reportable Event, that constitutes, or might reasonably lead
to, an ERISA Event; (ii) with respect to any Multiemployer
Plan, the receipt of notice as prescribed in ERISA or
otherwise of any withdrawal liability assessed against any of
their ERISA Affiliates, or of a determination that any
Multiemployer Plan is in reorganization or insolvent (both
within the meaning of Title IV of ERISA); (iii) the failure to
make full payment on or before the due date (including
extensions) thereof of all amounts which any Credit Party or
any ERISA Affiliate are required to contribute to each Plan
pursuant to its terms and as required to meet the minimum
funding standard set forth in ERISA and the Internal Revenue
Code; or (iv) any change in the funding status of any Plan
that reasonably could be expected to have a Material Adverse
Effect; together with a description of any such event or
condition or a copy of any such notice and a statement by the
chief financial officer of the Borrower briefly setting forth
the details regarding such event, condition, or notice, and
the action, if any, which has been or is being taken or is
proposed to be taken by the Credit Parties with respect
thereto. Promptly upon request, the Credit Parties shall
furnish the Administrative Agent and the Lenders with such
additional information concerning any Plan as may be
reasonably requested, including, but not limited to, copies of
each annual report/return (Form 5500 series), as well as all
schedules and attachments thereto required to be filed with
the Department of Labor and/or the Internal Revenue Service
pursuant to ERISA and the Internal Revenue Code, respectively,
for each "plan year" (within the meaning of Section 3(39) of
ERISA).
(e) Other. Promptly (and in any event within ten (10) days), any
other development or event which a Responsible Officer
determines could reasonably be expected to have a Material
Adverse Effect.
Each notice pursuant to this subsection shall be accompanied by a
statement of a Responsible Officer setting forth details of the occurrence
referred to therein and stating what action the relevant Credit Parties propose
to take with respect thereto.
(d) Payment of Obligations.
Subject to the DIP Financing Orders, each Credit Party shall pay,
discharge or otherwise satisfy, at or before maturity or before they become
delinquent (subject, where applicable, to specified grace periods), as the case
may be, all material post-petition obligations of such Credit Party of whatever
nature and any additional costs that are imposed as a result of any failure to
so pay, discharge or otherwise satisfy such obligations, except when the amount
or validity of such obligations and costs is currently being contested in good
faith by appropriate proceedings and reserves, if applicable, in conformity with
GAAP with respect thereto have been provided on the books of such Credit Party.
(e) Conduct of Business and Maintenance of Existence.
Subject to the DIP Financing Orders, each Credit Party shall (a)
continue to engage in business of the same general type as conducted on the
Closing Date by such Credit Party and similar or related businesses (including,
without limitation, the provision of any services to rail transportation
businesses); (b) preserve, renew and keep in full force and effect its corporate
or other legal existence except as otherwise permitted by this Agreement, (c)
take all reasonable action to maintain all rights, privileges, licenses and
franchises necessary or desirable in the normal conduct of its business except
to the extent that failure to comply therewith would not, in the aggregate, have
a Material Adverse Effect and (d) comply with all post-petition Contractual
Obligations, its Certificate of Incorporation or Bylaws (or other organizational
or governing documents) and all Requirements of Law applicable to it except to
the extent that failure to comply therewith would not, in the aggregate, have a
Material Adverse Effect.
37
(f) Maintenance of Property; Insurance.
Each member of the Transit Group shall keep all material property
useful and necessary in its business in reasonably good working order and
condition (ordinary wear and tear excepted) except to the extent that failure to
comply therewith would not, in the aggregate, have a Material Adverse Effect;
maintain with financially sound and reputable insurance companies casualty,
liability and such other insurance (which may include plans of self-insurance)
with such coverage and deductibles, and in such amounts as may be consistent
with prudent business practice and in any event consistent with normal industry
practice (except to any greater extent as may be required by the terms of any of
the other Credit Documents); and furnish to the Administrative Agent, upon
written request, full information as to the insurance carried.
(g) Books and Records; Inspection of Property; Discussions.
(a) Each Credit Party shall keep proper books of records and
account in which full, true and correct entries in conformity
with GAAP and all Requirements of Law shall be made of all
dealings and transactions in relation to its businesses and
activities;
(b) Each Credit Party shall permit, during regular business hours
and upon reasonable notice to a Responsible Officer by the
Administrative Agent, the Administrative Agent, and its
representatives, to visit and inspect any of its Facilities
that are used by any member of the Transit Group and examine
and make abstracts (including photocopies) from any of its
books and records (other than materials protected by the
attorney-client privilege and materials which such Credit
Party may not disclose without violation of a confidentiality
obligation binding upon it);
(c) Each Credit Party shall permit the Administrative Agent and
the Lenders to discuss the business, operations, Facilities
and financial and other condition of the Credit Parties with
officers and employees of the Credit Parties and, so long as
any discussion takes place in the presence of a Responsible
Officer, the Borrower's independent certified public
accountants; and
(d) Each Credit Party shall cooperate fully with any consultant
that is a "disinterested person" (as defined in Section
101(14) of the Bankruptcy Code) retained by the Administrative
Agent and the Lenders (the "Consultant"), which cooperation
shall include, without limitation, allowing the Consultant
reasonable access to observe the Credit Parties' respective
operations and financial records and projections, and the
Borrower shall reimburse the Administrative Agent and the
Lenders for all reasonable fees and expenses incurred by the
Administrative Agent and the Lenders in connection with their
retention of the Consultant;
(e) The Borrower shall (i) continue to engage a crisis manager
(the "Crisis Manager") to assist it in improving its cash
management and financial reporting and developing a
comprehensive business recovery plan in form reasonably
acceptable to the Administrative Agent for presentation to the
Administrative Agent and the Lenders, (ii) cause the Crisis
Manager to meet periodically with the Administrative Agent and
the Lenders to report on the Crisis Manager's findings,
reports and recommendations, and (iii) refrain from
terminating its current engagement of Glass & Associates, Inc.
as Crisis Manager unless the Borrower immediately replaces
Glass & Associates, Inc. with another Crisis Manager with
similar experience and reputation, and upon similar terms and
scope; and
(f) Each Credit Party shall permit the Administrative Agent, on
behalf of the Lenders, and its representatives (including
representatives of the Lenders), to conduct an annual audit of
the inventory and receivables of the Credit Parties, at the
expense of the Borrower.
The cost of the inspection referred to in clause (b) above shall be for
the account of the Credit Parties.
38
(h) Environmental Laws.
(a) Each Credit Party shall comply in all material respects with,
and take reasonable actions to ensure compliance in all
material respects by all tenants and subtenants, if any, with,
all applicable Environmental Laws and obtain and comply in all
material respects with and maintain, and take reasonable
actions to ensure that all tenants and subtenants obtain and
comply in all material respects with and maintain, any and all
licenses, approvals, notifications, registrations or permits
required by applicable Environmental Laws except to the extent
that failure to do so would not reasonably be expected to have
a Material Adverse Effect; and
(b) Each Credit Party shall conduct and complete all
investigations, studies, sampling and testing, and all
remedial, removal and other actions required under
Environmental Laws and promptly comply in all material
respects with all lawful orders and directives of all
Governmental Authorities regarding Environmental Laws except
to the extent that the same are being contested in good faith
by appropriate proceedings and the failure to do or the
pendency of such proceedings would not reasonably be expected
to have a Material Adverse Effect.
(i) Additional Guaranties and Stock Pledges.
(a) Domestic Subsidiaries. At any time that any Credit Party
forms, creates or otherwise acquires any Domestic Subsidiary
that is part of the "transit" segment of the Borrower's
business, such Credit Party shall (i) notify the
Administrative Agent within 10 days thereof and (ii) within 30
days thereof, (A) cause such Domestic Subsidiary to become a
Guarantor by execution of a Joinder Agreement, (B) cause such
Domestic Subsidiary to deliver with the Joinder Agreement such
supporting resolutions, incumbency certificates, corporate
formation and organizational documentation and opinions of
counsel as the Administrative Agent may reasonably request,
and (C) deliver stock certificates and related pledge
agreements or pledge joinder agreements (in form and substance
satisfactory to the Administrative Agent) evidencing the
pledge of 100% of the Capital Stock of such Domestic
Subsidiary as security for the Obligations, together with
undated stock transfer powers executed in blank.
(b) Foreign Subsidiaries. At any time that any Credit Party forms,
creates or otherwise acquires any Foreign Subsidiary that is
part of the "transit" segment of the Borrower's business
directly owned by the Borrower or any Domestic Subsidiary, the
Borrower shall (i) notify the Administrative Agent within 10
days thereof and (ii) within 30 days thereof, (A) deliver, or
cause delivery of, stock certificates and related pledge
agreements or pledge joinder agreements (in form and substance
satisfactory to the Administrative Agent) evidencing the
pledge of 66% (or such greater percentage which would not
result in material adverse tax consequences) of the Capital
Stock entitled to vote (within the meaning of Treas. Reg.
Section 1.956-2(c)(2)) and 100% of the Capital Stock not
entitled to vote (within the meaning of Treas. Reg. Section
1.956-2(c)(2)) of such Foreign Subsidiary as security for the
Obligations, together with undated stock transfer powers
executed in blank and (B) cause such Foreign Subsidiary to
deliver such corporate formation and organizational
documentation and opinions of counsel (regarding the
enforceability and creating, priority and perfection of the
stock pledge) as the Administrative Agent may reasonably
request.
(j) Ownership of Subsidiaries.
The Borrower shall, directly or indirectly, own at all times 100% of
the Voting Stock of each of member of the Transit Group.
39
(k) Application of Proceeds.
(a) The Borrower shall use the entire amount of the proceeds of
the Loans as provided in Section 4.15.
(b) The Borrower shall use a portion of the proceeds of the
initial Loans and a portion of the proceeds of the initial
"Loans" (as defined in the TP&S Revolving Credit Agreement)
under the TP&S Revolving Credit Agreement to permanently repay
100% of the Indebtedness outstanding under the Emergency Loan.
(c) The Borrower shall deposit $1,374,000 of the proceeds of the
initial Loans in a blocked account maintained with the
Administrative Agent (such account, the "Expense Account").
The funds in the Expense Account shall be a reserve to be
applied by the Administrative Agent to pay any unpaid General
Corporate Overhead Expenses and General Restructuring Costs;
provided that in no event shall the members of the Transit
Group pay more than 58% of the Borrower's total General
Corporate Overhead Expenses and General Restructuring Costs.
The Credit Parties agree that the amounts in the Expense
Account shall be subject to the Administrative Agent's Lien
and withdrawals by any Credit Party shall not be permitted.
(l) Compliance with Budgets.
As of the end of each week, the aggregate amount of actual
disbursements for operating expenses by members of the Transit Group during the
period from the Closing Date to the end of such week shall not exceed the
budgeted amounts for such period (as set forth in the related Initial Transit
Budget, Second Transit Budget or Transit Budget, as the case may be) by more
than (i) five percent (5%) for all budgeted line items in the aggregate and (ii)
ten percent (10%) for any individual line item on such budget (such line items
as to which such variance requirement shall apply to be determined by the
Administrative Agent in its sole discretion).
40
(m) Transit Payment Accounts; Payments.
(a) Transit Payment Accounts. The Borrower shall at all times
maintain with the Administrative Agent (or, at the option of
the Administrative Agent, its agent or the Bank Administrative
Agent (the "Transit Payment Account Agent")) a bank account
for the members of the Transit Group (the "Transit Payment
Account"). All proceeds of any account receivable or other
receivables and all cash from the sale of inventory or
equipment or for the rendition of services, or otherwise,
received by any member of the Transit Group shall be received
by such member of the Transit Group as the Administrative
Agent's trustee, and, within one (1) Business Day after
receipt thereof, shall be delivered to the Transit Payment
Account Agent in their original form duly endorsed in blank or
deposit them in the Transit Payment Account, as the
Administrative Agent may direct. If requested by the
Administrative Agent in its sole discretion, each Credit Party
shall instruct all of the account debtors in respect of its
accounts receivable and other receivables related to the
Transit Group to make all payments with respect thereto
directly into the Transit Payment Account. All amounts in the
Transit Payment Account (including any amounts received
directly by any member of the Transit Group and which are held
in trust for the Administrative Agent) shall (i) be subject to
the Transit Payment Account Agent's control and (ii) if
applicable, be applied to the prepayment of the Loans pursuant
to Section 2.05. Withdrawals from the Transit Payment Account
by any member of the Transit Group or any other Person shall
not be permitted, during the continuance of any Event of
Default.
(b) Payments. Unless a Default or Event of Default shall be
continuing, all collected funds held in the Transit Payment
Accounts shall be remitted by the Transit Payment Account
Agent on a daily basis to the Borrower.
(n) Payment of Taxes, Etc.
Each Credit Party shall pay and discharge, before the same shall become
delinquent, all lawful post-petition governmental claims, taxes, assessments,
charges and levies, except where contested in good faith by proper proceedings,
if adequate reserves therefor have been established on the books of such Credit
Party in conformity with GAAP.
(o) Collateral Documents.
Each Credit Party, at its sole cost and expense, shall take all actions
necessary or reasonably requested by the Administrative Agent to maintain each
Collateral Document in full force and effect and enforceable in accordance with
its terms, including (a) making filings and recordations, (b) making payments of
fees and other charges, (c) issuing, and if necessary, filing or recording
supplemental documentation, including continuation statements, (d) discharging
all claims or other Liens (other than Permitted Liens) adversely affecting the
rights of the Administrative Agent or any Lender in the Collateral, and (e)
publishing or otherwise delivering notice to third parties.
Item 45.
NEGATIVE COVENANTS
As long as any of the Obligations or Commitments remain outstanding,
each Credit Party agrees with the Lenders and the Administrative Agent that:
41
(a) Indebtedness.
No member of the Transit Group shall contract, create, incur, assume or
permit to exist, any Indebtedness, except:
(a) Indebtedness arising or existing under this Agreement and the
other Credit Documents;
(b) Indebtedness existing on the Filing Date (including
Indebtedness in respect of pre-petition surety obligations);
(c) Indebtedness arising under the Bond Credit Agreement and the
Bond Support Credit Agreement;
(d) purchase money Indebtedness (including Capital Lease
Obligations) incurred after the Closing Date to provide all or
a portion of the purchase price or costs of construction of an
asset; provided that (i) such Indebtedness when incurred shall
not exceed the purchase price or cost of construction of such
asset, (ii) no such Indebtedness shall be refinanced for a
principal amount in excess of the principal balance
outstanding thereon at the time of such refinancing, and (iii)
the aggregate amount of all such Indebtedness shall not exceed
$1,000,000 at any time outstanding;
(e) unsecured intercompany Indebtedness owing by a member of the
Transit Group to another member of the Transit Group to the
extent permitted by Section 6.05;
(f) Indebtedness in respect of financed insurance premium
obligations;
(g) Indebtedness of the Borrower in respect of the "track" segment
of its business, under the TP&S Revolving Credit Agreement as
in effect on the date hereof; and
(h) Support Obligations of any member of the Transit Group in
respect of Indebtedness permitted under clauses (a) through
(g) of this Section 6.01.
(b) Liens.
No member of the Transit Group shall contract, create, incur, assume or
permit to exist, any Lien or apply to the Bankruptcy Court to do the same with
respect to any of its property or assets of any kind (whether real or personal,
tangible or intangible), whether now owned or hereafter acquired, except for
Permitted Liens.
42
(c) Consolidation, Merger, Divestiture, etc.
(a) No member of the Transit Group shall enter into a transaction
of merger or consolidation, except the Borrower or any
Domestic Credit Party may be a party to a transaction of
merger or consolidation with a Domestic Credit Party, provided
that (i) if the Borrower is a party thereto, it shall be the
surviving corporation, and (ii) no Default or Event of Default
shall exist either immediately prior to or immediately after
giving effect thereto.
(b) No member of the Transit Group shall make any Divestiture
unless the consideration paid in connection therewith shall be
cash or Cash Equivalents (and such payment shall be
contemporaneous with consummation of such Divestiture).
(c) No member of the Transit Group shall liquidate, wind-up or
dissolve, whether voluntarily or involuntarily (or suffer to
permit any such liquidation or dissolution), other than in
connection with a merger, consolidation or Divestiture
permitted under this Agreement.
(d) Acquisitions.
No member of the Transit Group shall make any Acquisition.
(e) Investments.
No member of the Transit Group shall make any Investment in any Person
except for Permitted Investments.
(f) Ownership of Equity Interests.
No member of the Transit Group shall enter into any Equity Transaction.
(g) Fiscal Year.
The Borrower shall not change its fiscal year from a December 31 fiscal
year end.
(h) Restricted Payments.
No member of the Transit Group shall make or permit any Restricted
Payments.
(i) Sale Leasebacks.
No member of the Transit Group shall, directly or indirectly, become
liable as lessee or as guarantor or other surety with respect to any lease,
whether an Operating Lease or a Capital Lease, of any Property, whether now
owned or hereafter acquired, (a) which such Person has sold or transferred or is
to sell or transfer to any other Person other than a Credit Party or (b) which
such Person intends to use for substantially the same purpose as any other
Property which has been sold or is to be sold or transferred by such Person to
any other Person in connection with such lease.
(j) No Further Negative Pledges.
Except with respect to prohibitions against other encumbrances on
specific Property encumbered to secure payment of particular Indebtedness (which
Indebtedness relates solely to such specific Property, and improvements and
accretions thereto, and is otherwise permitted hereby), no member of the Transit
Group shall enter into, assume or become subject to any agreement prohibiting or
otherwise restricting the creation or assumption of any Lien upon
43
its Facilities or assets, whether now owned or hereafter acquired, or requiring
the grant of any security for such obligation if security is given for some
other obligation.
(k) Limitations on Transactions with Affiliates.
No member of the Transit Group shall enter into or permit to exist any
transaction or series of transactions with any officer, director or Affiliate of
such Person other than (a) intercompany transactions expressly permitted by
Section 6.01, Section 6.03 or Section 6.05, (b) normal compensation and
reimbursement of expenses of officers and directors (including any retention
arrangements approved by the Administrative Agent) and (c) except as otherwise
specifically limited in this Agreement, other transactions which are entered
into in the ordinary course of such Person's business on terms and conditions
substantially as favorable to such Person as would be obtainable by it in a
comparable arms-length transaction with a Person other than an officer, director
or Affiliate.
(l) Payment of Other Indebtedness.
(a) No member of the Transit Group shall pay any Indebtedness
arising prior to the Filing Date other than (i) pursuant to
the Motion of the Debtors Pursuant to Section 105(a) of the
Bankruptcy Code for Authorization to Pay Prepetition Claims of
Trade Vendors in form and substance reasonably satisfactory to
the Administrative Agent and (ii) as permitted by orders of
the Bankruptcy Court reasonably satisfactory in form and
substance to the Administrative Agent and the Lenders.
(b) No member of the Transit Group shall prepay any Indebtedness,
except for the Obligations in accordance with the terms of
this Agreement or in connection with any mandatory prepayment
provisions set forth in the Bond Support Credit Agreement as
in effect on the date hereof.
(m) Investment Banking and Finder's Fees.
No member of the Transit Group shall pay or agree to pay, or reimburse
any other party with respect to, any investment banking or similar or related
fee, underwriter's fee, finder's fee, or broker's fee to any Person in
connection with this Agreement, other than the fees payable pursuant to Section
2.08 of this Agreement.
44
(n) Maximum Capital Expenditures.
(a) From the period commencing on the Closing Date until December
31, 2001, the Credit Parties shall not permit the aggregate
Capital Expenditures of the members of the Transit Group to
exceed $100,000 for any calendar month within such period,
provided that the unused amount available for such Capital
Expenditures under this Section 6.14(a) for any given month
may be carried forward and used in any subsequent calendar
month.
(b) For each calendar month ending after December 31, 2001,
Capital Expenditures of the Transit Group shall be subject to
such limitations as the Administrative Agent shall establish
(in consultation with the Borrower) based upon the Business
Plan.
(o) No Material Pleadings.
(a) None of the Credit Parties shall file any Material Pleading
without the prior written consent of the Majority Lenders.
(b) None of the Credit Parties shall consent, encourage, support
or assist in any manner to the entry of an order with respect
to a Material Pleading filed by any other Person without the
prior written consent of the Majority Lenders.
(p) Modification of Contractual Obligations.
The Borrower shall not, and shall not permit any of its Subsidiaries
to, alter, amend, modify, rescind, terminate or waive any of their respective
rights or obligations under, or fail to comply in all material respects with,
any of its material post-petition Contractual Obligations (including, without
limitation any of the Financing Agreements); provided, however, that, (a) with
respect to any Contractual Obligation (other than the Financing Agreements), the
Borrower shall not be deemed in default of this Section 6.16 if such
alterations, amendments, modifications, rescissions, terminations or waivers in
the aggregate have no Material Adverse Effect and (b) with respect to any
Financing Agreement, the Borrower shall not be deemed in default of this Section
6.16 if such alterations, amendments, modifications, rescissions, terminations
or waivers are not materially adverse to the interests of the Lenders and the
Administrative Agent; and provided, further, that in the event of any breach or
event of default by a Person other than the Borrower or any of its Subsidiaries,
the Borrower shall promptly notify the Administrative Agent of any such breach
or event of default and take all such action as may be reasonably necessary in
order to avoid having such breach or event of default have a Material Adverse
Effect.
(q) Accounting Changes.
No Credit Party shall make any change in accounting treatment and
reporting practices or tax reporting treatment, except as required by GAAP or
law and disclosed to the Lenders and the Administrative Agent.
Item 46.
EVENTS OF DEFAULT
(a) Events of Default.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
45
(a) Payment. Any Credit Party shall:
(a) default in the payment when due of any principal of
any Loan, or
(b) default, and such default shall continue for three
(3) or more Business Days, in the payment when due of
(A) any interest on any Loan or (B) any fees or other
amounts owing under this Agreement or any other
Credit Documents or otherwise in connection herewith
or therewith; or
(b) Representations. Any representation, warranty or statement
made or deemed to be made herein, in any of the other Credit
Documents, or in any statement or certificate delivered or
required to be delivered pursuant hereto or thereto shall
prove untrue in any material respect on the date as of which
it was made or deemed to have been made (other than those
which are untrue solely as a result of changes permitted by
this Agreement); or
(c) Covenants. Any Credit Party shall:
(a) Default in the due performance or observance of any
term, covenant or agreement contained in Section
5.03(a), 5.05, 5.09, 5.10, 5.11, 5.13, 5.14, 5.15 or
Article VI; or
(b) Default in the due performance or observance by it of
any term, covenant or agreement (other than those
referred to in subsections (a), (b) or (c)(i) of this
Section 7.01) contained in this Agreement or any
other Credit Document and such default shall continue
unremedied for a period of at least 30 days after the
earlier of a Responsible Officer becoming aware of
such default or notice thereof by the Administrative
Agent; or
(d) Other Credit Documents. Except as to any Credit Party which is
dissolved, released or merged or consolidated out of existence
as the result of, or in connection with, a dissolution, merger
or disposition permitted by this Agreement, any Credit
Document shall fail to be (or any Credit Party or any Person
acting by or on behalf of any Credit Party shall claim or
allege in writing that any Credit Document is not) in full
force and effect or to give the Administrative Agent and/or
the Lenders any material part of the Liens, rights, powers and
privileges purported to be created thereby; or
(e) Guaranties. Except as to any Credit Party which is dissolved,
released or merged or consolidated out of existence as the
result of or in connection with a dissolution, merger or
disposition permitted by this Agreement, the guaranty given by
any Guarantor hereunder or any material provision thereof
shall cease to be in full force and effect, or any Guarantor
or any Person acting by or on behalf of such Guarantor shall
deny or disaffirm such Guarantor's obligations hereunder or
under any other Credit Document; or
(f) Defaults under Other Agreements.
(a) Financing Agreements. The occurrence of an "Event of
Default" under the TP&S Revolving Credit Agreement,
the Bond Credit Agreement or the Bond Support Credit
Agreement
(b) With respect to any Indebtedness arising after the
Filing Date (other than Indebtedness outstanding
under this Agreement, the Bond Credit Agreement and
the Bond Support Credit Agreement) in excess of
$500,000 in the aggregate for the members of Transit
Group taken as a whole, (A) (1) any member of the
Transit Group shall default in any payment (beyond
the applicable grace period with respect thereto, if
any) with respect to any such Indebtedness, or (2)
the occurrence and continuation of a default in the
observance or performance relating to such
Indebtedness or contained in any instrument or
agreement evidencing, securing or
46
relating thereto, or any other event or condition
shall occur or condition exist, the effect of which
default or other event or condition is to cause, or
permit, the holder or holders of such post-petition
Indebtedness (or trustee or agent on behalf of such
holders) to cause (determined without regard to
whether any notice or lapse of time is required), any
such Indebtedness to become due prior to its stated
maturity; or (B) any such Indebtedness shall be
declared due and payable, or required to be prepaid
other than by a regularly scheduled required
prepayment, prior to the stated maturity thereof; or
(g) Judgments. Any Credit Party shall fail within 30 days of the
date due and payable to pay, bond or otherwise discharge any
judgment, settlement or order for the payment of money
relating to claims arising after the Filing Date which
judgment, settlement or order, when aggregated with all other
such judgments, settlements or orders due and unpaid at such
time, exceeds $500,000, and which is not stayed on appeal (or
for which no motion for stay is pending) or is not otherwise
being executed; or
(h) ERISA. Any of the following events or conditions, if such
event or condition could reasonably be expected to have a
Material Adverse Effect: (i) any "accumulated funding
deficiency," as such term is defined in Section 302 of ERISA
and Section 412 of the Internal Revenue Code, whether or not
waived, shall exist with respect to any Plan, or any Lien
shall arise on the assets of any Credit Party or any ERISA
Affiliate in favor of the PBGC or a Plan; (ii) an ERISA Event
shall occur with respect to a Single Employer Plan, which is,
in the reasonable opinion of the Administrative Agent, likely
to result in the termination of such Plan for purposes of
Title IV of ERISA; (iii) an ERISA Event shall occur with
respect to a Multiemployer Plan or Multiple Employer Plan,
which is, in the reasonable opinion of the Administrative
Agent, likely to result in (A) the termination of such Plan
for purposes of Title IV of ERISA, or (B) any Credit Party or
any ERISA Affiliate incurring any liability in connection with
a withdrawal from, reorganization of (within the meaning of
Section 4241 of ERISA), or insolvency of (within the meaning
of Section 4245 of ERISA) such Plan; or (iv) any prohibited
transaction (within the meaning of Section 406 of ERISA or
Section 4975 of the Internal Revenue Code) or breach of
fiduciary responsibility shall occur which may subject any
Credit Party or any ERISA Affiliate to any liability under
Sections 406, 409, 502(i), or 502(l) of ERISA or Section 4975
of the Internal Revenue Code, or under any agreement or other
instrument pursuant to which any Credit Party or any ERISA
Affiliate has agreed or is required to indemnify any person
against any such liability; or
(i) Ownership. There shall occur a Change of Control; or
(j) Reorganization Plan. Any Credit Party shall file, or consent
to, support or encourage in any manner a filing by any other
Person, with the Bankruptcy Court a reorganization plan in
respect of any member of the Transit Group that does not
provide for payment in full in cash of the Obligations on the
effective date thereof without the prior written consent of
the Majority Lenders and that is not otherwise reasonably
satisfactory to the Administrative Agent; or
(k) Prepayment of Other Indebtedness. Any Credit Party shall pay
any Indebtedness arising before the Filing Date other than (i)
pursuant to the Motion of the Debtors Pursuant to Section
105(a) of the Bankruptcy Code for Authorization to Pay
Prepetition Claims of Trade Vendors in form and substance
reasonably satisfactory to the Administrative Agent and (ii)
as permitted by orders of the Bankruptcy Court reasonably
satisfactory in form and substance to the Administrative Agent
and the Lenders; or
(l) Bankruptcy Cases. Any of the Bankruptcy Cases shall be
dismissed or converted to a case under Chapter 7 of the
Bankruptcy Code; a trustee under Chapter 7 or Chapter 11 of
the Bankruptcy Code shall be appointed in any of the
Bankruptcy Cases; or any Credit Party shall file or support
any application for the approval of, or there shall arise, any
other claim (other than the Carve-Out) which
47
is an administrative expense claim having priority over any or
all administrative expenses of the kind specified in Sections
503(b) or 507(b) of the Bankruptcy Code; or the Bankruptcy
Cases of the Borrower and any other member of the Consolidated
Group shall be substantively consolidated or the Bankruptcy
Cases of any Guarantor and any member of the Consolidated
Group that is not a Guarantor shall be substantively
consolidated; or
(m) Relief to Lien Holders. The Bankruptcy Court shall enter an
order granting relief from the automatic stay applicable under
section 362 of the Bankruptcy Code permitting foreclosure on
any asset of any Credit Party with a net depreciated book
value in excess of $500,000; or
(n) Appointment of Trustee. An order of the Bankruptcy Court shall
be entered in any of the Bankruptcy Cases appointing a
trustee, examiner or Responsible Officer with expanded powers
(powers beyond those set forth in Section 1106(a)(3) and (4)
of the Bankruptcy Code) to operate the Borrower's business or
a substantial portion thereof; or
(o) DIP Financing Orders.
(a) An order of the Bankruptcy Court shall be entered
amending, supplementing, vacating or otherwise
modifying the Interim DIP Financing Order or the
Final DIP Financing Order that is not consented to by
the Administrative Agent and the Lenders; or
(b) An order of the Bankruptcy Court shall be entered
staying for a period in excess of ten (10) days the
Interim DIP Financing Order or the Final DIP
Financing Order that is not consented to by the
Administrative Agent and the Lenders (it being
understood that the entry of an order of the
Bankruptcy Court staying the Interim DIP Financing
Order or the Final DIP Financing Order that is not
consented to by the Administrative Agent and the
Lenders shall constitute a "Default" under this
Agreement); or
(p) Final DIP Financing Order. The Final DIP Financing Order shall
not have been entered by the Bankruptcy Court on or before the
expiration of the Interim Period; or
(q) Order of Bankruptcy Court. An order shall be entered by the
Bankruptcy Court confirming a plan of reorganization or
liquidation in the Bankruptcy Cases which does not contain a
provision for termination of all of the Commitments and
payment in full in cash of the Obligations on or before the
effective date of such plan.
(b) Acceleration; Remedies.
Upon the occurrence and during the continuation of an Event of Default,
without further order of, application to, or action by the Bankruptcy Court, the
Administrative Agent (a) may, and shall upon the request of the Majority
Lenders, by written notice to the Borrower declare that all or any portion of
the Commitments be terminated, whereupon the obligation of each Lender to make
any Loan shall immediately terminate, and/or (b) may, and shall upon the request
of the Majority Lenders, by written notice to the Borrower declare the Loans,
all interest thereon and all other amounts and Obligations payable under this
Agreement to be forthwith due and payable, whereupon the Loans, all such
interest, and all such amounts and Obligations shall become and be forthwith due
and payable, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower. In addition, subject solely to
any requirement of the giving of notice by the terms of the Interim DIP
Financing Order or the Final DIP Financing Order, the automatic stay provided in
Section 362 of the Bankruptcy Code shall be automatically vacated without
further action or order of the Bankruptcy Court, and the Administrative Agent
and the Lenders shall be entitled to exercise all of their respective rights and
remedies under the Credit Documents and applicable law, including without
limitation, all rights and remedies with respect to the Collateral and the
Guarantors.
48
Item 47.
GUARANTY
(a) The Guarantee.
(a) (i) Each of the Guarantors hereby jointly and severally
guarantees to each Lender and to the Administrative Agent, as
hereinafter provided, the prompt payment of the Guaranteed
Obligations in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration, as a mandatory cash
collateralization or otherwise) strictly in accordance with
the terms thereof. The Guarantors hereby further agree that if
any of the Guaranteed Obligations are not paid in full when
due (whether at stated maturity, as a mandatory prepayment, by
acceleration, as a mandatory cash collateralization or
otherwise), the Guarantors will, jointly and severally,
promptly pay the same, without any demand or notice
whatsoever, and that in the case of any extension of time of
payment or renewal of any of the Guaranteed Obligations, the
same will be promptly paid in full when due (whether at
extended maturity, as a mandatory prepayment, by acceleration,
as a mandatory cash collateralization or otherwise) in
accordance with the terms of such extension or renewal.
(b) Notwithstanding any provision to the contrary contained herein
or in any of the other Credit Documents, to the extent the
obligations of a Guarantor shall be adjudicated to be invalid
or unenforceable for any reason (including, without
limitation, because of any applicable state, provincial or
Federal law relating to fraudulent conveyances or transfers or
the granting of financial assistance) then the obligations of
each Guarantor hereunder shall be limited to the maximum
amount that is permissible under applicable law (whether
Federal, state or provincial and including, without
limitation, the Bankruptcy Code). In such case or otherwise at
the request of the Administrative Agent, each Credit Party
shall take such action and shall execute and deliver all such
further documents required by the Administrative Agent to
cause the obligations of such Guarantor to be enforceable to
the extent required by this Agreement.
(b) Obligations Unconditional.
The obligations of the Guarantors under Section 8.01 are joint and
several, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Credit Documents or any
other agreement or instrument referred to therein, or any substitution, release
or exchange of any other guarantee of or security for any of the Guaranteed
Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor,
it being the intent of this Section 8.02 that the obligations of each of the
Guarantors hereunder shall be absolute and unconditional under any and all
circumstances. Each Guarantor agrees that such Guarantor shall have no right of
subrogation, indemnity, reimbursement or contribution against the Borrower or
any other Guarantor for amounts paid under this Article VIII until such time as
all of the Lenders have been paid in full, all of the Commitments under the
Agreement have been terminated and no Person or Governmental Authority shall
have any right to request any return or reimbursement of funds from the Lenders
in connection with monies received under the Credit Documents. Without limiting
the generality of the foregoing, it is agreed that, to the fullest extent
permitted by law, the occurrence of any one or more of the following shall not
alter or impair the liability of any Guarantor hereunder which shall remain
absolute and unconditional as described above:
49
(a) at any time or from time to time, without notice to
any Guarantor, the time for any performance of or
compliance with any of the Guaranteed Obligations
shall be extended, or such performance or compliance
shall be waived;
(b) any of the acts mentioned in any of the provisions of
any of the Credit Documents or any other agreement or
instrument referred to in the Credit Documents shall
be done or omitted;
(c) the maturity of any of the Guaranteed Obligations
shall be accelerated, or any of the Guaranteed
Obligations shall be modified, supplemented or
amended in any respect, or any right under any of the
Credit Documents or any other agreement or instrument
referred to in the Credit Documents shall be waived
or any other guarantee of any of the Guaranteed
Obligations or any security therefor shall be
released or exchanged in whole or in part or
otherwise dealt with;
(d) any Lien granted to, or in favor of, the
Administrative Agent or any Lender or Lenders, as
security for any of the Guaranteed Obligations shall
fail to attach or be perfected; or
(e) any of the Guaranteed Obligations shall be determined
to be void or voidable (including, without
limitation, for the benefit of any creditor of any
Guarantor) or shall be subordinated to the claims of
any Person (including, without limitation, any
creditor of any Guarantor).
With respect to its obligations hereunder, each Guarantor hereby expressly
waives diligence, presentment, demand of payment, protest and all notices
whatsoever, and any requirement that the Administrative Agent or any Lender
exhaust any right, power or remedy or proceed against any Person under any of
the Credit Documents or any other agreement or instrument referred to in the
Credit Documents, or against any other Person under any other guarantee of, or
security for, any of the Guaranteed Obligations.
(c) Reinstatement.
(a) The obligations of the Guarantors under this Article VIII
shall be automatically reinstated if and to the extent that
for any reason any payment by or on behalf of any Person in
respect of the Guaranteed Obligations is rescinded or must be
otherwise restored by any holder of any of the Guaranteed
Obligations, whether as a result of any proceedings in
bankruptcy or reorganization or otherwise, and each Guarantor
agrees that it will indemnify the Administrative Agent and
each Lender on demand for all reasonable costs and expenses
(including, without limitation, reasonable fees and expenses
of counsel) incurred by the Administrative Agent or such
Lender in connection with such rescission or restoration,
including any such costs and expenses incurred in defending
against any claim alleging that such payment constituted a
preference, fraudulent transfer or similar payment under any
bankruptcy, insolvency or similar law.
(d) Certain Additional Waivers.
Each Guarantor agrees that such Guarantor shall have no right of
recourse to security for the Guaranteed Obligations, except through the exercise
of the rights of subrogation pursuant to Section 8.02.
(e) Remedies.
The Guarantors agree that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, the Guaranteed Obligations may be declared to be
forthwith due and payable as provided in Section 7.02 (and shall be deemed to
have become automatically due and payable in the circumstances provided in said
Section 7.02) for purposes of Section 8.01 notwithstanding any stay, injunction
or other prohibition preventing such declaration (or preventing the Guaranteed
Obligations from becoming automatically due and payable) as against any other
Person and that, in the event of such declaration (or the Guaranteed Obligations
being deemed to have become automatically due and payable), the Guaranteed
50
Obligations (whether or not due and payable by any other Person) shall forthwith
become due and payable by the Guarantors for purposes of Section 8.01.
(f) Rights of Contribution.
The Guarantors hereby agree, as among themselves, that if any Guarantor
shall become an Excess Funding Guarantor, each other Guarantor shall, on demand
of such Excess Funding Guarantor (but subject to the succeeding provisions of
this Section 8.06), pay to such Excess Funding Guarantor an amount equal to such
Guarantor's Pro Rata Share (as defined below and determined, for this purpose,
without reference to the Facilities, assets, liabilities and debts of such
Excess Funding Guarantor) of such Excess Payment (as defined below). The payment
obligation of any Guarantor to any Excess Funding Guarantor under this Section
8.06 shall be subordinate and subject in right of payment to the prior payment
in full of the obligations of such Guarantor under the other provisions of this
Article VIII, and such Excess Funding Guarantor shall not exercise any right or
remedy with respect to such excess until payment and satisfaction in full of all
of such obligations. For purposes hereof, (a) "Excess Funding Guarantor" shall
mean, in respect of any obligations arising under the other provisions of this
Article VIII (hereafter, the "Guarantied Obligations"), a Guarantor that has
paid an amount in excess of its Pro Rata Share of the Guarantied Obligations;
(b) "Excess Payment" shall mean, in respect of any Guarantied Obligations, the
amount paid by an Excess Funding Guarantor in excess of its Pro Rata Share of
such Guarantied Obligations; and (c) "Pro Rata Share", for the purposes of this
Section 8.06, shall mean, for any Guarantor, the ratio (expressed as a
percentage) of (i) the amount by which the aggregate present fair saleable value
of all of its assets and Facilities exceeds the amount of all debts and
liabilities of such Guarantor (including contingent, subordinated, unmatured,
and unliquidated liabilities, but excluding the obligations of such Guarantor
hereunder) to (ii) the amount by which the aggregate present fair saleable value
of all assets and other Facilities of the Borrower and all of the Guarantors
exceeds the amount of all of the debts and liabilities (including contingent,
subordinated, unmatured, and unliquidated liabilities, but excluding the
obligations of the Borrower and the Guarantors hereunder) of the Borrower and
all of the Guarantors, all as of the Closing Date (if any Guarantor becomes a
party hereto subsequent to the Closing Date, then for the purposes of this
Section 8.06 such subsequent Guarantor shall be deemed to have been a Guarantor
as of the Closing Date and the information pertaining to, and only pertaining
to, such Guarantor as of the date such Guarantor became a Guarantor shall be
deemed true as of the Closing Date).
(g) Continuing Guarantee.
The guarantee in this Article VIII is a continuing guarantee, and shall
apply to all Guaranteed Obligations whenever arising.
Item 48.
SECURITY
(a) Priority and Liens.
(a) Each of the Credit Parties hereby covenants, represents and
warrants that, upon entry of the Interim DIP Financing Order
(i) pursuant to Section 364(c)(1) of the Bankruptcy Code, the
Obligations shall at all times constitute allowed
administrative expense claims in the Bankruptcy Cases with
priority over all administrative expense claims and unsecured
claims against the Credit Parties, now existing or hereafter
arising, of any kind or nature whatsoever, including, without
limitation, administrative expenses of the kinds specified in
or ordered pursuant to Sections 105, 326, 330, 331, 503(a),
503(b), 506(c), 507(a), 507(b), 546(c), 546(d), and 1114 of
the Bankruptcy Code and (ii) pursuant to Sections 364(c)(2)
and 364(d) of the Bankruptcy Code, the Obligations shall at
all times be secured by a perfected first priority Lien on all
property and assets of each member of the Transit Group,
except for the Excluded Assets, and all assets directly
related to the Specified Contracts (other than the equipment
set forth on Schedule III) subject only to (A) Senior Liens,
(B) the Carve Out (defined below) in an aggregate amount not
in excess of $1,450,000 (the "Carve-Out") and (C) the
UST/Clerk Fees. The Carve-Out may be used only to pay the fees
and expenses of professionals employed by the Credit Parties,
the fees and expenses of professionals employed by
51
any statutory committee appointed by the Bankruptcy Court
under Section 1102 of the Bankruptcy Code ("Statutory
Committee"), and the expenses of members of any such Statutory
Committee; provided that all such fees and expenses are
authorized to be paid or approved by the Bankruptcy Court to
the extent required under the Bankruptcy Code; provided,
however, that the Carve-Out shall not include, apply to or be
available for any fees or expenses incurred by any party,
including the Credit Parties or any Statutory Committee, in
connection with the initiation or prosecution (but not
investigation) of any claims, causes of action, adversary
proceedings or other litigation against the Administrative
Agent or the Lenders, including, without limitation,
challenging the amount, validity, priority or enforceability
of, or asserting any defense, claim, counterclaim or offset
to, the Obligations or the Liens of the Administrative Agent
and the Lenders under this Agreement in respect thereof. The
Lenders agree that so long as the Maturity Date shall not have
occurred or the Administrative Agent or the Lenders have not
exercised any remedies as a result of an Event of Default, the
Credit Parties shall be permitted to pay compensation and
reimbursement of expenses accrued and payable under 11
X.X.X.xx. 330 and 11 X.X.X.xx. 331, as the same may be due and
payable as authorized by the Bankruptcy Court, and the same
shall not reduce the amount available under the Carve-Out. The
foregoing shall not be construed as a consent to the allowance
of any fees and expenses or bonuses referred to above and
shall not affect the right of the Credit Parties, the
Administrative Agent or the Lenders to object to the allowance
and payment of such amounts.
(b) As to all real property the title to which is held by any of
the Credit Parties, or the possession of which is held by any
of the Credit Parties pursuant to a leasehold interest or
otherwise, each of the Credit Parties hereby assigns and
conveys as security, grants a security interest in,
hypothecates, mortgages, pledges and sets over unto the
Administrative Agent on behalf of the Lenders all of the
right, title and interest of such Credit Party in all of such
owned real property and in all such leasehold interests or
other interests, together in each case with all of the right,
title and interest of such Credit Party in and to all
buildings, improvements, and fixtures related thereto, any
lease or sublease thereof, all general intangibles relating
thereto and all proceeds thereof, such assignment, conveyance
and security interest to have the priorities set forth in
Section 9.01(a)(i) and (ii) above.
(c) Each of the Credit Parties acknowledges that, pursuant to the
DIP Financing Orders, the Liens in favor of the Administrative
Agent on behalf of the Lenders in all of such real property
and leasehold interests, and all of the other Collateral,
shall be perfected without the taking of any further action,
including any recordation of any instruments of mortgage or
assignment, or the recording or filing of any financing
statements, notices of lien or other similar instruments.
Item 49.
THE ADMINISTRATIVE AGENT
(a) Appointment.
The Lenders hereby designate and appoint CSFB, as Administrative Agent
of the Lenders to act as specified herein and the other Credit Documents, and
each of the Lenders hereby authorizes the Administrative Agent to take such
action on its behalf under the provisions of this Agreement and the other Credit
Documents and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms hereof and of the other
Credit Documents, together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere herein and in
the other Credit Documents, the Administrative Agent shall not have any duties
or responsibilities, except those expressly set forth herein and therein, or any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any of the other Credit Documents, or shall otherwise exist against
the Administrative Agent. The provisions of this Article X are solely for the
benefit of the Administrative Agent and the Lenders, and none of the Credit
Parties shall have any rights as a third party beneficiary of the provisions
hereof. In performing its functions and duties under this Agreement and the
other
52
Credit Documents, the Administrative Agent shall act solely as the
Administrative Agent of the Lenders and does not assume and shall not be deemed
to have assumed any obligation or relationship of agency or trust with or for
any Credit Party or any of their respective Affiliates.
(b) Delegation of Duties.
The Administrative Agent may execute any of its duties hereunder or
under the other Credit Documents by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. The Administrative Agent shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable
care.
(c) Exculpatory Provisions.
Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any
action lawfully taken or omitted to be taken by them or such Person under or in
connection herewith or in connection with any of the other Credit Documents
(except for its or such Person's own gross negligence or willful misconduct), or
(ii) responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by any of the Credit Parties
contained herein or in any of the other Credit Documents or in any certificate,
report, document, financial statement or other written or oral statement
referred to or provided for in, or received by the Administrative Agent under or
in connection herewith or in connection with the other Credit Documents, or the
enforceability or sufficiency therefor of any of the other Credit Documents, or
for any failure of any Credit Party to perform its obligations hereunder or
thereunder. The Administrative Agent shall not be responsible to any Lender for
the effectiveness, genuineness, validity, enforceability, collectability or
sufficiency of this Agreement or any of the other Credit Documents or for any
representations, warranties, recitals or statements made herein or therein or
made by any Credit Party in any written or oral statement or in any financial or
other statements, instruments, reports, certificates or any other documents in
connection herewith or therewith furnished or made available by the
Administrative Agent to the Lenders or by or on behalf of the Credit Parties to
the Administrative Agent or any Lender or be required to ascertain or inquire as
to the performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained herein or therein or as to the use of the
proceeds of the Loans or of the existence or possible existence of any Default
or Event of Default or to inspect the properties, books or records of the Credit
Parties or any of their respective Affiliates.
(d) Reliance On Communications.
The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document or conversation 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 (including, without
limitation, counsel to any of the Credit Parties, independent accountants and
other experts selected by the Administrative Agent with reasonable care). The
Administrative Agent may deem and treat the Lenders as the owners of their
respective interests hereunder for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent in accordance with Section 11.03(b). The Administrative
Agent shall be fully justified in failing or refusing to take any action under
this Agreement or under any of the other Credit Documents unless it shall first
receive such advice or concurrence of the Majority Lenders as it deems
appropriate or it shall first be indemnified to its 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. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting,
hereunder or under any of the other Credit Documents in accordance with a
request of the Majority Lenders (or to the extent specifically provided in
Section 11.06, all the Lenders) and such request and any action taken or failure
to act pursuant thereto shall be binding upon all the Lenders (including their
successors and assigns).
(e) Notice of Default.
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless it
has received notice from a Lender or a Credit Party referring to the
53
Credit Document, describing such Default or Event of Default and stating that
such notice is a "notice of default." In the event that the Administrative Agent
receives such a notice, it shall give prompt notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Majority Lenders.
(f) Non-Reliance On Administrative Agent and Other Lenders.
Each Lender expressly acknowledges that neither the Administrative
Agent nor any of its officers, directors, employees, agents, attorneys-in-fact
or affiliates has made any representations or warranties to it and that no act
by the Administrative Agent or any affiliate thereof hereinafter taken,
including any review of the affairs of any Credit Party or any of their
respective Affiliates, shall be deemed to constitute any representation or
warranty by the Administrative Agent to any Lender. Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
the Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, assets, operations, property, financial and
other conditions, prospects and creditworthiness of the Credit Parties or their
respective Affiliates and made its own decision to make its Loans hereunder and
other financial accommodations hereunder and enter into this Agreement. Each
Lender also represents that it will, independently and without reliance upon the
Administrative Agent 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 analysis, appraisals and decisions in taking or not taking action under
this Agreement, and to make such investigation as it deems necessary to inform
itself as to the business, assets, operations, property, financial and other
conditions, prospects and creditworthiness of the Credit Parties and their
respective Affiliates. Except for notices, reports and other documents expressly
required to be furnished to the Lenders by the Administrative Agent hereunder,
the Administrative Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the business,
operations, assets, property, financial or other conditions, prospects or
creditworthiness of the Credit Parties or any of their respective Affiliates
which may come into the possession of the Administrative Agent or any of their
officers, directors, employees, agents, attorneys-in-fact or affiliates.
(g) Indemnification.
The Lenders agree to indemnify the Administrative Agent in its capacity
as such (to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), ratably according to their respective
Commitments (or if the Commitments have expired or been terminated, in
accordance with the respective principal amounts of outstanding Loans of the
Lenders), from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time (including without limitation at
any time following the final payment of all of the obligations of the Borrower
hereunder and under the other Credit Documents) be imposed on, incurred by or
asserted against the Administrative Agent in its capacity as such in any way
relating to or arising out of this Agreement or the other Credit Documents or
any documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby or any action taken or omitted by
the Administrative Agent under or in connection with any of the foregoing;
provided that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements the extent they are found in a final judgment
by a court of competent jurisdiction to have arisen from the Administrative
Agent's gross negligence or willful misconduct. If any indemnity furnished to
the Administrative Agent for any purpose shall, in the opinion of the
Administrative Agent, be insufficient or become impaired, the Administrative
Agent may call for additional indemnity and cease, or not commence, to do the
acts indemnified against until such additional indemnity is furnished. The
agreements in this Section 10.07 shall survive the repayment of the Loans and
other obligations under the Credit Documents and the termination of the
Commitments hereunder.
(h) Administrative Agent In Its Individual Capacity.
The Administrative Agent and its affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Borrower,
its Subsidiaries or its Affiliates as though the Administrative Agent were not
the Administrative Agent hereunder. With respect to the Loans and all other
obligations of the Borrower hereunder and under the other Credit Documents, the
Administrative Agent shall have the same rights and powers
54
under this Agreement as any Lender and may exercise the same as though it were
not the Administrative Agent hereunder, and the terms "Lender" and "Lenders"
shall include the Administrative Agent in its individual capacity.
(i) Successor Administrative Agent.
The Administrative Agent may, at any time, resign upon 20 days' written
notice to the Lenders, and may be removed, upon show of cause, by the Majority
Lenders upon 30 days' written notice to the Administrative Agent; provided that
the Administrative Agent shall not resign or be removed without the prior
written consent of the Borrower, which consent shall not be unreasonably
withheld or delayed, and any attempted resignation by or removal of the
Administrative Agent without the prior written consent of the Borrower shall be
null and void ab initio. Upon any such resignation or removal, the Majority
Lenders shall have the right to appoint a successor Administrative Agent. If no
successor Administrative Agent shall have been so appointed by the Majority
Lenders, and shall have accepted such appointment, within 30 days after the
notice of resignation or notice of removal, as appropriate, then the retiring
Administrative Agent shall select a successor Administrative Agent; provided
that such successor is a Lender hereunder or a financial institution organized
under the laws of the United States of America or of any State thereof and has a
combined capital and surplus of at least $400,000,000. Upon the acceptance of
any appointment as Administrative Agent hereunder by a successor, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its duties and
obligations as Administrative Agent under this Agreement and the other Credit
Documents, and the provisions of this Article X shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Administrative Agent
under this Agreement.
Item 50.
MISCELLANEOUS
(a) Notices.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (i) when
delivered, (ii) when transmitted via telecopy (or other facsimile device) to the
number set out below, (iii) the day following the day on which the same has been
delivered prepaid to a reputable national overnight air courier service, or (iv)
the third Business Day following the day on which the same is sent by certified
or registered mail, postage prepaid, in each case to the respective parties at
the address, in the case of the Borrower, the Guarantors and the Administrative
Agent, set forth below, and, in the case of the Lenders, set forth on Schedule
11.01, or at such other address as such party may specify by written notice to
the other parties hereto:
if to the Borrower or any Guarantor:
RailWorks Corporation
0000 Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxx, XX 00000
Attn: Chief Financial Officer
Telephone: 000-000-0000
Telecopy: 000-000-0000
with a copy to:
Xxxxxxx Xxxx & Xxxxxxxxx
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxx, Esq. and
Xxxx Xxxxxxxx, Esq.
Telephone: 000-000-0000
Facsimile: 000-000-0000
55
and
Xxxxxxxxx, Xxxxxx & Preston
Seven Saint Xxxx Street
Baltimore, MD 21202
Attention: Xxxxxx X. Xxxxxxxx, Esq.
Telephone: 000-000-0000
Facsimile: 000-000-0000
if to the Administrative Agent:
CSFB Global Opportunities Advisers, LLC
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xx. Xxxxx Xxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to:
Xxxxx Xxxxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxx, Esq. and
Xxxxxx Xxxx Xxxxx III, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
and
Venable, Xxxxxxx and Xxxxxx, LLP
0 Xxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
56
(b) Right of Set-Off.
In addition to any rights now or hereafter granted under applicable law
or otherwise, and not by way of limitation of any such rights, upon the
occurrence of an Event of Default, each Lender is authorized at any time and
from time to time, without presentment, demand, protest or other notice of any
kind (all of which rights being hereby expressly waived), to set-off and to
appropriate and apply any and all deposits (general or special) and any other
indebtedness at any time held or owing by such Lender (including, without
limitation branches, agencies or Affiliates of such Lender wherever located) to
or for the credit or the account of any Credit Party against obligations and
liabilities of such Person to such Lender hereunder, under the Notes, the other
Credit Documents or otherwise, irrespective of whether such Lender shall have
made any demand hereunder and although such obligations, liabilities or claims,
or any of them, may be contingent or unmatured, and any such set-off shall be
deemed to have been made immediately upon the occurrence of an Event of Default
even though such charge is made or entered on the books of such Lender
subsequent thereto. Any Person purchasing a participation in the Loans and
Commitments hereunder pursuant to Section 11.03(d) may exercise all rights of
set-off with respect to its participation interest as fully as if such Person
were a Lender hereunder.
(c) Benefit of Agreement.
(a) Generally. This Agreement shall be binding upon and inure to
the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; provided that, except as
expressly provided herein, none of the Credit Parties may
assign or transfer any of its interests without prior written
consent of the Lenders; provided, further, that the rights of
each Lender to transfer, assign or grant participations in its
rights and/or obligations hereunder shall be limited as set
forth in this Section 11.03; provided, however, that nothing
herein shall prevent or prohibit any Lender from (i) pledging
its Loans hereunder to a Federal Reserve Bank in support of
borrowings made by such Lender from such Federal Reserve Bank
or (ii) granting assignments or selling participations in such
Lender's Loans and/or Commitments hereunder to its parent
company and/or to any Affiliate or Subsidiary of such Lender.
(b) Assignments. Each Lender may assign all or a portion of its
rights and obligations hereunder (including, without
limitation, all or a portion of its Ratable Portion of
Obligations and its Commitments), pursuant to an assignment
agreement substantially in the form of Exhibit F, to (i) a
Lender, (ii) an affiliate of a Lender, (iii) any fund that
invests in bank loans and is managed by an investment advisor
to a Lender or an affiliate of such investment advisor, or
(iv) any other Person that (A) is a bank, financial
institution, commercial lender or institutional investor, (B)
such Person shall be reasonably acceptable to the
Administrative Agent, and (C) so long as no Default or Event
of Default has occurred and is continuing, such Person shall
be reasonably acceptable to the Borrower (the consent of the
Borrower not to be unreasonably withheld or delayed); provided
that (i) any such assignment (other than any assignment to (I)
a Lender, (II) an affiliate of a Lender and (III) any fund
that invests in bank loans and is managed by an investment
advisor to a Lender or an affiliate of such investment
advisor) shall be in a minimum aggregate amount of $2,000,000
(or, if less, the remaining amount of the Commitments being
assigned by such Lender); and (ii) each such assignment shall
be of a constant, not varying, percentage of all such Lender's
rights and obligations under this Agreement. Any assignment
hereunder shall be effective upon delivery to the
Administrative Agent of written notice of the assignment
together with a transfer fee of $3,500 payable to the
Administrative Agent for its own account from and after the
later of (i) the effective date specified in the applicable
assignment agreement and (ii) the date of recording of such
assignment in the Register pursuant to the terms of subsection
(c) below; provided, however, that no such fee shall be
payable in the case of an assignment to another Lender, an
affiliate of a Lender or any fund that invests in bank loans
and is managed by an investment advisor to a Lender or an
affiliate of such investment advisor; provided, further, that
in the case of contemporaneous assignments by a Lender to more
than one fund managed by the same investment advisor (which
funds are not then Lenders), only a single assignment fee of
$3,500 shall be payable for all such contemporaneous
assignments. The assigning Lender will give prompt notice to
the Administrative Agent and the Borrower of any such
57
assignment. Upon the effectiveness of any such assignment (and
after notice to, and (to the extent required pursuant to the
terms hereof), with the consent of, the Borrower as provided
herein), the assignee shall become a "Lender" for all purposes
of this Agreement and the other Credit Documents and, to the
extent of such assignment, the assigning Lender shall be
relieved of its obligations hereunder to the extent of the
Loans and Commitment components being assigned. The Borrower
agrees that upon notice of any such assignment and surrender
of the appropriate Note or Notes, it will promptly provide to
the assigning Lender and to the assignee separate promissory
notes in the amount of their respective interests
substantially in the form of the original Note (but with
notation thereon that it is given in substitution for and
replacement of the original Note or any replacement notes
thereof). By executing and delivering an assignment agreement
in accordance with this Section 11.03(b), the assigning Lender
thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties
hereto as follows: (i) such assigning Lender warrants that it
is the legal and beneficial owner of the interest being
assigned thereby free and clear of any adverse claim; (ii)
except as set forth in clause (i) above, such assigning Lender
makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement,
any of the other Credit Documents or any other instrument or
document furnished pursuant hereto or thereto, or the
execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, any of the other
Credit Documents or any other instrument or document furnished
pursuant hereto or thereto or the financial condition of any
Credit Party or any of their respective Affiliates or the
performance or observance by any Credit Party of any of its
obligations under this Agreement, any of the other Credit
Documents or any other instrument or document furnished
pursuant hereto or thereto; (iii) such assignee represents and
warrants that it is legally authorized to enter into such
assignment agreement; (iv) such assignee confirms that it has
received a copy of this Agreement, the other Credit Documents
and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to
enter into such assignment agreement; (v) such assignee will
independently and without reliance upon the Administrative
Agent, such assigning Lender or any other Lender, and based on
such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking
or not taking action under this Agreement and the other Credit
Documents; (vi) such assignee appoints and authorizes the
Administrative Agent to take such action on its behalf and to
exercise such powers under this Agreement or any other Credit
Document as are delegated to the Administrative Agent by the
terms hereof or thereof, together with such powers as are
reasonably incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their terms all the
obligations which by the terms of this Agreement and the other
Credit Documents are required to be performed by it as a
Lender.
(c) Maintenance of Register. The Administrative Agent shall
maintain at its offices a copy of each Lender assignment
agreement delivered to it in accordance with the terms of
subsection (b) above and a register for the recordation of the
identity of the principal amount of each Loan outstanding
hereunder, the names, addresses and the Commitments of the
Lenders pursuant to the terms hereof from time to time (the
"Register"). The Administrative Agent will make reasonable
efforts to maintain the accuracy of the Register and to
promptly update the Register from time to time, as necessary.
The entries in the Register shall be conclusive in the absence
of manifest error, and the Borrower, the Administrative Agent
and the Lenders may treat each Person whose name is recorded
in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement. The Register
shall be available for inspection by the Borrower and each
Lender, at any reasonable time and from time to time upon
reasonable prior notice.
(d) Participations. Each Lender may sell, transfer, grant or
assign participations in all or a portion of such Lender's
rights, obligations or rights and obligations hereunder
(including all or a portion of its Commitments or its Loans);
provided that (i) such selling Lender shall remain a "Lender"
for all purposes under this Agreement (such selling Lender's
obligations under the Credit Documents remaining unchanged)
and the participant shall not constitute a Lender hereunder,
(ii) no such participant shall have, or be granted, rights to
approve any amendment or waiver relating to this Agreement or
the other Credit Documents except to the extent any such
amendment or waiver would
58
(A) reduce the principal of or rate of interest on or fees in
respect of any Loans in which the participant is participating
or (B) postpone the date fixed for any payment of principal
(including extension of the Maturity Date or the date of any
mandatory prepayment), interest or fees in which the
participant is participating, and (iii) sub-participations by
the participant (except to an affiliate, parent company or
affiliate of a parent company of the participant) shall be
prohibited. In the case of any such participation, the
participant shall not have any rights under this Agreement or
the other Credit Documents (the participant's rights against
the selling Lender in respect of such participation to be
those set forth in the participation agreement with such
Lender creating such participation) and all amounts payable by
the Borrower hereunder shall be determined as if such Lender
had not sold such participation; provided, however, that such
participant shall be entitled to receive additional amounts
under Sections 2.10, 2.11, 2.13 and 11.02 on the same basis as
if it were a Lender.
(d) No Waiver; Remedies Cumulative.
No failure or delay on the part of the Administrative Agent or any
Lender in exercising any right, power or privilege hereunder or under any other
Credit Document and no course of dealing between the Administrative Agent or any
Lender and any of the Credit Parties shall operate as a waiver thereof; nor
shall any single or partial exercise of any right, power or privilege hereunder
or under any other Credit Document preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder or
thereunder. The rights and remedies provided herein are cumulative and not
exclusive of any rights or remedies which the Administrative Agent or any Lender
would otherwise have. No notice to or demand on any Credit Party in any case
shall entitle the Borrower or any other Credit Party to any other or further
notice or demand in similar or other circumstances or constitute a waiver of the
rights of the Administrative Agent or the Lenders to any other or further action
in any circumstances without notice or demand.
(e) Payment of Expenses; Indemnification.
(a) The Borrower agrees to: (i) pay all reasonable out-of-pocket
costs and expenses (A) of the Administrative Agent and the
Lenders in connection with the negotiation, preparation,
execution and delivery and administration of this Agreement
and the other Credit Documents and the documents and
instruments referred to therein (including, without
limitation, the reasonable fees and expenses of counsel of the
Administrative Agent and the Lenders) and any amendment,
waiver or consent relating hereto and thereto including, but
not limited to, any such amendments, waivers or consents
resulting from or related to any work-out, renegotiation or
restructure relating to the performance by the Credit Parties
under this Agreement, (B) the development, negotiation,
approval and consummation of the disclosure statement and the
plan of reorganization of any of the Credit Parties and (C) of
the Administrative Agent and the Lenders in connection with
enforcement of the Credit Documents and the documents and
instruments referred to therein (including, without
limitation, in connection with any such enforcement, the
reasonable fees and disbursements of counsel for the
Administrative Agent and each of the Lenders); (ii) permit the
Administrative Agent to perform inventory and accounts
receivable field audits at the Borrower's expense, provided
that unless an Event of Default shall be in existence the
Borrower's obligation to reimburse the Administrative Agent
for such field audits shall be limited to one such field audit
each fiscal year; and (iii) pay and hold each of the Lenders
harmless from and against any and all present and future stamp
and other similar taxes with respect to the foregoing matters
and save each of the Lenders harmless from and against any and
all liabilities with respect to or resulting from any delay or
omission (other than to the extent attributable to such
Lender) to pay such taxes.
(b) The Borrower shall indemnify the Administrative Agent, each
Lender and their respective officers, directors, employees,
representatives and agents (each, an "Indemnitee") from and
hold each of them harmless against any and all losses,
liabilities, claims, damages or expenses incurred by any of
them as a result of, or arising out of, or in any way related
to, or by reason of (A) any investigation, litigation or other
proceeding (whether or not the any Indemnitee is a party
thereto) related to the entering into and/or performance of
any Credit Document or the use of proceeds of any Loan or the
consummation of any other transactions contemplated in any
Credit Document, including, without
59
limitation, the reasonable fees and disbursements of counsel
incurred in connection with any such investigation, litigation
or other proceeding or (B) the presence or Release of any
Materials of Environmental Concern at, under or from any
Property owned, operated or leased by the Borrower or any of
its Subsidiaries, or the failure by the Borrower or any of its
Subsidiaries to comply with any Environmental Law (but
excluding, in the case of either of clause (A) or (B) above,
any such losses, liabilities, claims, damages or expenses to
the extent incurred by reason of gross negligence or willful
misconduct on the part of the Person to be indemnified).
(f) Amendments, Waivers and Consents.
No amendment or waiver of any provision of this Agreement nor consent
to any departure by the Borrower therefrom shall in any event be effective
unless the same shall be in writing and signed by the Majority Lenders, and then
any such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given; provided, however, that no amendment,
waiver or consent shall, unless in writing and signed by all the Lenders do any
of the following:
(a) waive any of the conditions specified in Article III except as
otherwise provided therein;
(b) increase the Commitments of the Lenders or subject the Lenders
to any additional obligations;
(c) reduce the principal of, or interest on, the Loans or any fees
or other amounts payable hereunder;
(d) postpone any date fixed for any payment of principal of, or
interest on, the Loans or any fees or other amounts payable
hereunder;
(e) change the percentage of the Commitments or the aggregate
unpaid principal amount of the Loans which shall be required
for the Lenders or any of them to take any action hereunder;
(f) release any of the Collateral except as shall otherwise be
provided in the Collateral Documents; or
(g) amend this Section 11.06;
and provided, further, that no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent in addition to the Lenders
required above to take such action, affect the rights or duties of the
Administrative Agent under this Agreement or the other Credit Documents. Any
amendment, consent, or waiver that does not comply with the provisions of this
Section 11.06 shall be void and of no effect.
Notwithstanding the fact that the consent of all the Lenders is
required in certain circumstances as set forth above, (x) each Lender is
entitled to vote as such Lender sees fit on any bankruptcy reorganization plan
that affects the Loans, and each Lender acknowledges that the provisions of
Section 1126(c) of the Bankruptcy Code supersede the unanimous consent
provisions set forth herein and (y) the Majority Lenders may consent to allow a
Credit Party to use cash collateral in the context of a bankruptcy or insolvency
proceeding.
(g) Counterparts.
This Agreement may be executed in any number of counterparts, each of
which when so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. It shall not be necessary in
making proof of this Agreement to produce or account for more than one such
counterpart.
(h) Headings.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Agreement.
60
(i) Survival.
All indemnities set forth herein, including, without limitation, in
Section 2.10, 2.11, 2.13, 10.07 or 11.05 shall survive the execution and
delivery of this Agreement, the making of the Loans, the repayment of the Loans
and other obligations under the Credit Documents and the termination of the
Commitments hereunder, and all representations and warranties made by the Credit
Parties herein shall survive delivery of the Notes and the making of the Loans
hereunder.
(j) Governing Law; Submission to Jurisdiction; Venue.
(a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL
BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK AND THE APPLICABLE
PROVISIONS OF THE BANKRUPTCY CODE.
(b) The Bankruptcy Court shall have exclusive jurisdiction over
any motion, claim or dispute arising from or relating to this
Agreement or any other Credit Document Any legal action or
proceeding with respect to this Agreement or any other Credit
Document shall be brought in the Bankruptcy Court or the
United States District Court for the District of Maryland and,
by execution and delivery of this Agreement, each of the
parties hereto hereby irrevocably accepts for itself and in
respect of its property, generally and unconditionally, the
jurisdiction of such court. Each of the Credit Parties further
irrevocably consents to the service of process out of any of
the aforementioned courts in any such action or proceeding by
the mailing of copies thereof by registered or certified mail,
postage prepaid, to it at the address set out for notices
pursuant to Section 11.01, such service to become effective
three (3) days after such mailing. Nothing herein shall affect
the right of the Administrative Agent or any Lender to serve
process in any other manner permitted by law or to commence
legal proceedings or to otherwise proceed against any Credit
Party in any other jurisdiction.
(c) TO THE EXTENT PERMITTED BY LAW, THE ADMINISTRATIVE AGENT, THE
LENDERS, THE BORROWER AND THE OTHER CREDIT PARTIES HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS
AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
(k) Severability.
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
(l) Entirety.
This Agreement, together with the Exhibits and Schedules hereto and the
other Credit Documents, represent the entire agreement of the parties hereto and
thereto with respect to the subject matter hereof and thereof, and supersede all
prior agreements and understandings, either oral or written, with respect to the
subject matter hereof and thereof.
(m) Binding Effect; Termination.
(a) This Agreement shall become effective at such time on or after
the Closing Date when it shall have been executed by the
Borrower, the Guarantors and the Administrative Agent, and the
Administrative Agent shall have received copies hereof
(telefaxed or otherwise) which, when taken
61
together, bear the signatures of each Lender, and thereafter this Agreement
shall be binding upon and inure to the benefit of the Borrower, the Guarantors,
the Administrative Agent and each Lender and their respective successors and
assigns.
(b) The term of this Agreement shall commence on the effective
date pursuant to subsection (a) above and shall continue until
no Obligations or any other amounts payable hereunder or under
any of the other Credit Documents shall remain outstanding and
until all of the Commitments hereunder shall have expired or
been terminated.
(n) Confidentiality.
The Administrative Agent and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its and its affiliates' directors, officers, employees
and agents, including accountants, legal counsel and other advisors (it being
understood that the Persons to whom such disclosure is made will be informed of
the confidential nature of such Information and instructed to keep such
Information confidential); (b) to the extent requested by any regulatory
authority; (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process; (d) to any other party to this Agreement;
(e) in connection with the exercise of any remedies hereunder or any suit,
action or proceeding relating to this Agreement or the enforcement of rights
hereunder; (f) subject to an agreement containing provisions substantially the
same as those of this Section 11.14, to (i) any assignee of or participant in,
or any prospective assignee of or participant in, any of its rights or
obligations under this Agreement or (ii) any direct or indirect contractual
counterparty or prospective counterparty (or such contractual counterparty's or
prospective counterparty's professional advisor) to any credit derivative
transaction relating to obligations of the Borrower; (g) with the consent of the
Borrower; (h) to the extent such Information (i) becomes publicly available
other than as a result of a breach of this Section 11.14 or (ii) becomes
available to the Administrative Agent or any Lender on a nonconfidential basis
from a source other than the Borrower; or (i) to the National Association of
Insurance Commissioners or any other similar organization or any nationally
recognized rating agency that requires access to information about a Lender's or
its Affiliates' investment portfolio in connection with ratings issued with
respect to such Lender or its Affiliates. For the purposes of this Section,
"Information" means all information received from the Borrower relating to the
Borrower or its business, other than any such information that is available to
the Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by the Borrower; provided that, in the case of information received
from the Borrower after the date hereof, such information is clearly identified
in writing at the time of delivery as confidential. Any Person required to
maintain the confidentiality of Information as provided in this Section 11.14
shall be considered to have complied with its obligation to do so if such Person
has exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.
(o) Source of Funds.
Each of the Lenders hereby represents and warrants to the Borrower that
at least one of the following statements is an accurate representation as to the
source of funds to be used by such Lender in connection with the financing
hereunder:
(a) no part of such funds constitutes assets allocated to any
separate account maintained by such Lender in which any
employee benefit plan (or its related trust) has any interest;
(b) to the extent that any part of such funds constitutes assets
allocated to any separate account maintained by such Lender,
such Lender has disclosed to the Borrower the name of each
employee benefit plan whose assets in such account exceed 10%
of the total assets of such account as of the date of such
purchase (and, for purposes of this subsection (b), all
employee benefit plans maintained by the same employer or
employee organization are deemed to be a single plan);
(c) to the extent that any part of such funds constitutes assets
of an insurance company's general account, such insurance
company has complied with all of the requirements of the
regulations issued
62
under Section 401(c)(1)(A) of ERISA or such insurance company
meets the requirements of Department of Labor Exemption 95-60;
or
(d) such funds constitute assets of one or more specific benefit
plans which such Lender has identified in writing to the
Borrower.
As used in this Section 11.15, the terms "employee benefit plan" and
"separate account" shall have the respective meanings assigned to such terms in
Section 3 of ERISA.
(p) Conflict.
To the extent that there is a conflict or inconsistency between any
provision hereof, on the one hand, and any provision of any Credit Document, on
the other hand, this Agreement shall control. To the extent that there is a
conflict or inconsistency between any provision of any Credit Document, on the
one hand, and any provision of the DIP Financing Order, on the other hand, the
DIP Financing Order shall control.
(q) Limitation on Liability.
NO CLAIM MAY BE MADE BY THE ADMINISTRATIVE AGENT, ANY CREDIT PARTY, ANY
LENDER OR OTHER PERSON AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER, ANY CREDIT
PARTY OR THE AFFILIATES, DIRECTORS, OFFICERS, OFFICERS, EMPLOYEES, OR AGENTS OF
ANY OF THEM FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES IN
RESPECT OF ANY CLAIM FOR BREACH OF CONTRACT OR ANY OTHER THEORY OF LIABILITY
ARISING OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR
ANY OTHER CREDIT DOCUMENT, OR ANY ACT, OMISSION OR EVENT OCCURRING IN CONNECTION
THEREWITH, AND THE CREDIT PARTIES, THE ADMINISTRATIVE AGENT AND EACH LENDER
HEREBY WAIVE, RELEASE AND AGREE NOT TO XXX UPON ANY CLAIM FOR SUCH DAMAGES,
WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO EXIST IN ITS
FAVOR.
[SIGNATURE PAGE FOLLOWS.]
63
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Agreement to be duly executed and delivered as of the date first above
written.
RAILWORKS CORPORATION,
as Borrower
By:
-------------------------------------
Name:
Title:
BREAKING TECHNOLOGY & EQUIPMENT INC.,
as Guarantor
By:
-------------------------------------
Name:
Title:
HSQ TECHNOLOGY, A CORPORATION,
as Guarantor
By:
-------------------------------------
Name:
Title:
X.X. XXXXXXXX & COMPANY, INC.,
as Guarantor
By:
-------------------------------------
Name:
Title:
M-TRACK ENTERPRISES, INC.,
as Guarantor
By:
-------------------------------------
Name:
Title:
RAILWORKS TRANSIT, INC.,
as Guarantor
By:
-------------------------------------
Name:
Title:
RWKS CONSTRUCTION, INC.,
as Guarantor
By:
-------------------------------------
Name:
Title:
RAILWORKS TRANSIT SYSTEMS, INC.,
as Guarantor
By:
-------------------------------------
Name:
Title:
CSFB GLOBAL OPPORTUNITIES ADVISERS, LLC,
as Administrative Agent
By:
-------------------------------------
Name:
Title:
CSFB GLOBAL OPPORTUNITIES ADVISERS, LLC,
as Lender
By:
-------------------------------------
Name:
Title:
