EXHIBIT 10.35
FIRST AMENDED AND RESTATED CREDIT AGREEMENT
by and among
MKS INSTRUMENTS, INC.,
as Borrower,
FLEET NATIONAL BANK
as Agent and as Lender,
and
JPMORGAN CHASE BANK,
as Lender
Dated as of July 31, 2002
TABLE OF CONTENTS
Page
ARTICLE I. DEFINITIONS...................................................................... 2
1.1 Definitions............................................................... 2
1.2 Accounting Terms.......................................................... 10
1.3 Other Definitional Provisions............................................. 10
ARTICLE II. REVOLVING CREDIT FACILITY....................................................... 10
2.1 Revolving Credit.......................................................... 10
2.2 Advances.................................................................. 11
2.3 Revolving Loan Account.................................................... 12
2.4 Interest.................................................................. 12
2.5 Interest Periods.......................................................... 13
2.6 Unused Commitment Fee..................................................... 13
2.7 Deficiency Advances....................................................... 14
ARTICLE III. LETTER OF CREDIT FACILITY...................................................... 14
3.1 Letter of Credit Commitment............................................... 14
3.2 Reimbursement Obligation of the Borrower.................................. 15
3.3 Letter of Credit Payments................................................. 15
3.4 Obligations Absolute...................................................... 15
3.5 Reliance by Issuer........................................................ 16
3.6 Letter of Credit Fees..................................................... 16
ARTICLE IV. ADDITIONAL TERMS................................................................ 16
4.1 Payments.................................................................. 16
4.2 Capital Adequacy.......................................................... 18
4.3 Special Provisions Governing LIBOR Loans.................................. 18
4.4 Taxes..................................................................... 20
ARTICLE V. REPRESENTATIONS AND WARRANTIES OF THE BORROWER................................... 20
5.1 Organization, Existence and Power......................................... 20
5.2 Authorization of Loan Documents; Binding Effect........................... 21
5.3 Authority................................................................. 21
5.4 Capital Structure......................................................... 21
5.5 Financial Condition....................................................... 22
5.6 Pending Litigation........................................................ 22
5.7 Certain Agreements; Material Contracts.................................... 22
5.8 Authorization, Etc........................................................ 22
5.9 No Violation.............................................................. 23
5.10 Payment of Taxes.......................................................... 23
5.11 Transactions With Affiliates, Officers, Directors and 1% Shareholders..... 23
5.12 ERISA..................................................................... 24
5.13 Ownership of Properties; Liens............................................ 24
5.14 Employment Matters........................................................ 24
5.15 Insurance................................................................. 24
5.16 Indebtedness.............................................................. 24
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5.17 Securities Law Compliance................................................. 25
5.18 Accuracy of Information................................................... 25
ARTICLE VI. CONDITIONS TO ADVANCES.......................................................... 25
6.1 Each Advance.............................................................. 25
6.2 First Advance............................................................. 26
ARTICLE VII. AFFIRMATIVE COVENANTS OF THE BORROWER.......................................... 27
7.1 Reporting Requirements.................................................... 27
7.2 Loan Proceeds............................................................. 28
7.3 Maintenance of Business and Properties; Insurance......................... 28
7.4 Payment of Taxes.......................................................... 29
7.5 Compliance with Laws, etc................................................. 29
7.6 Books, Records and Accounts............................................... 29
7.7 Further Assurances........................................................ 30
7.8 Bank Accounts............................................................. 30
7.9 Guaranties................................................................ 30
ARTICLE VIII. NEGATIVE COVENANTS OF THE BORROWER............................................ 30
8.1 Sale of Assets; Mergers, Etc.............................................. 30
8.2 Liens and Encumbrances.................................................... 31
8.3 Sales and Leasebacks...................................................... 33
8.4 Indebtedness.............................................................. 33
8.5 Dividends and Distributions............................................... 34
8.6 Investments............................................................... 34
8.7 Transactions with Affiliates.............................................. 35
8.8 ERISA Compliance.......................................................... 35
8.9 Tangible Net Worth Test................................................... 36
8.10 Total Liabilities-to-Tangible Net Worth Ratio............................. 36
8.11 Consolidated Net Cash Test................................................ 36
8.12 Capital Expenditures...................................................... 36
8.13 Consolidated Operating Loss Test.......................................... 36
8.14 Contracts Prohibiting Compliance with Agreement........................... 36
ARTICLE IX. EVENTS OF DEFAULT............................................................... 36
9.1 Default................................................................... 36
9.2 Agent to Act.............................................................. 38
9.3 Cumulative Rights......................................................... 38
9.4 No Waiver................................................................. 39
9.5 Allocation of Proceeds.................................................... 39
ARTICLE X. THE AGENT........................................................................ 39
10.1 Appointment............................................................... 39
10.2 Limitation on Liability................................................... 39
10.3 Reliance.................................................................. 40
10.4 Notice of Default......................................................... 40
10.5 No Representations........................................................ 40
10.6 Indemnification........................................................... 41
10.7 The Agent in its Individual Capacity...................................... 41
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10.8 Resignation............................................................... 41
10.9 Sharing of Payments, Etc.................................................. 42
10.10 Fees ................................................................. 42
ARTICLE XI. MISCELLANEOUS................................................................... 42
11.1 Assignments and Participations............................................ 42
11.2 Survival of Representations, Etc.......................................... 44
11.3 Right of Setoff........................................................... 44
11.4 Indemnity; Costs, Expenses and Taxes...................................... 44
11.5 Notices................................................................... 45
11.6 MASSACHUSETTS LAW......................................................... 46
11.7 Counterparts.............................................................. 46
11.8 JURISDICTION, SERVICE OF PROCESS.......................................... 46
11.9 Limit on Interest......................................................... 47
11.10 Amendments................................................................ 47
11.11 Headings.................................................................. 48
11.12 WAIVER OF NOTICE, ETC..................................................... 48
11.13 Severability.............................................................. 48
11.14 Entire Agreement.......................................................... 48
11.15 Compliance with Covenants................................................. 48
11.16 Termination............................................................... 49
11.17 WAIVER OF TRIAL BY JURY................................................... 49
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FIRST AMENDED AND RESTATED CREDIT AGREEMENT
This First Amended and Restated Credit Agreement (the "Agreement") is
entered into as of the 31st day of July, 2002, by and among Fleet National Bank
("Fleet"), JPMorgan Chase Bank ("Chase"; hereinafter Fleet and Chase may be
referred to individually as a "Lender" or collectively as the "Lenders"), Fleet
in its capacity as agent for the Lenders (in such capacity, together with any
successor agent appointed in accordance with the terms of Section 10.8, the
"Agent"), and MKS Instruments, Inc., a Massachusetts corporation ("Borrower").
Whereas Borrower, the Lenders and the Agent entered into a Credit
Agreement dated as of July 31, 2001 (as amended, the "Original Credit
Agreement"), which the parties now desire to amend and restate in order to
modify certain terms thereof,
Now, therefore, in consideration of the premises and for other good and
valuable consideration, the adequacy and receipt of which are hereby
acknowledged, the parties hereto hereby agree to amend and restate the Original
Credit Agreement as follows:
ARTICLE I.
DEFINITIONS
1.1 Definitions. In addition to terms defined elsewhere in this
Agreement, the following terms shall have the meanings indicated, which meanings
shall be equally applicable to both the singular and plural forms of such terms:
"Accounts" shall mean, at any time, all accounts receivable
of Borrower and its subsidiaries on a consolidated basis determined in
accordance with GAAP appearing on the Borrower's consolidated balance sheet.
"Adjustment Date" shall mean the first day of the month
immediately following the month in which a Compliance Certificate is to be
delivered by the Borrower pursuant to Section 7.1(c).
"Advance" shall mean the drawing down by the Borrower of a
Base Rate Loan or a LIBOR Loan on any given Advance Date.
"Advance Date" shall mean the date as of which an Advance is
consummated.
"Affiliate" of any Person shall mean any other Person which,
directly or indirectly, controls, or is controlled by, or is under common
control with, such Person. For purposes of this definition, "control" of any
Person shall mean the power, directly or indirectly, either to (i) vote 10% or
more of the securities having ordinary voting power for the election of
directors of such Person or (ii) direct the management and policies of such
Person, whether by contract or otherwise. As to the Borrower, the term
"Affiliate" shall include, without limitation, any partnership or joint venture
of which the Borrower or any Affiliate of the Borrower is a general partner or
is a limited partner with more than a ten percent (10%) interest, and any
director or executive officer of the Borrower.
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"Applicable Commitment Percentage" shall mean, with respect
to each Lender at any time, a fraction, the numerator of which shall be such
Lender's Commitment and the denominator of which shall be the Total Commitment,
which Applicable Commitment Percentage for each Lender as of the Closing Date is
as set forth in Exhibit A; provided, however, that the Applicable Commitment
Percentage of each Lender shall be increased or decreased to reflect any
assignments to or by such Lender effected in accordance with Section 11.1.
"Applicable Margin" shall mean for each period commencing on
an Adjustment Date through the date immediately preceding the next Adjustment
Date, the applicable margin set forth below with respect to the Total
Liabilities-To-Tangible Net Worth Ratio, as determined for the most recent
fiscal quarter for which the Borrower has delivered its financial statements
pursuant to Section 7.1(a) or (b) and Compliance Certificate pursuant to Section
7.1(c), provided that if and so long as the Total Outstandings exceed
$10,000,000, each applicable margin set forth below shall be increased by 0.50%
(e.g., 2.00% would increase to 2.50%):
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TOTAL LIABILITIES-TO-TANGIBLE APPLICABLE MARGIN FOR APPLICABLE MARGIN FOR
NET WORTH RATIO LIBOR LOANS AND LETTER UNUSED COMMITMENT FEE
OF CREDIT FEE
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Greater than or equal to 0.50:1.00 2.00% 0.40%
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Less than 0.50:1.00 but greater than 1.50% 0.40%
or equal to 0.25:1.00
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Less than 0.25:1.00 1.25% 0.30%
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If for any reason the Borrower shall fail to deliver the financial statements or
Compliance Certificate as required, the Applicable Margin shall in each case be
the highest percentage set forth above.
"Assignment and Acceptance" shall mean an Assignment and
Acceptance in the form of Exhibit B (with blanks appropriately filled in)
delivered to the Agent in connection with an assignment of a Lender's interest
under this Agreement pursuant to Section 11.1.
"Base Rate" shall mean the higher of (a) the annual rate of
interest announced from time to time by Fleet at Fleet's office at ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, as its "base rate" or (b) one-half of one percent
(1/2%) above the Federal Funds Effective Rate. For the purposes of this
definition, "Federal Funds Effective Rate" shall mean, for any day, the rate per
annum equal to the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers, as published for
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such day (or, if such day is not a Business Day, for the next preceding Business
Day) by the Federal Reserve Bank of New York, or if such rate is not so
published for any day that is a Business Day, the average of the quotations for
such day on such transactions received by Fleet from three funds brokers of
recognized standing selected by Fleet.
"Base Rate Loan" shall mean an Advance that is specified as
such in the Notice of Borrowing with respect to such Advance and that bears
interest at the Base Rate.
"Borrowing" shall mean the incurrence of one or more Advances
on a given date.
"Business Day" shall mean a day on which commercial banks are
required to be open for business in Boston, Massachusetts.
"Change in Control" shall be deemed to have occurred at such
time after the date hereof that any person (other than, in the case of clause
(ii) below, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, together with its affiliates and associates (as
defined in Rule 12b-2 under the Securities Exchange Act of 1934 (the "Exchange
Act") or any successor rule thereto):
(i) shall file with the Securities and Exchange Commission and
deliver to the Borrower a report under or in response to Schedule 13D or 14D-1
(or any successor schedule, form or report) pursuant to the Exchange Act
disclosing that such person has become the beneficial owner (as defined in Rule
13D-3 under the Exchange Act, or any successor provisions) of more than 25% of
the total voting power of all classes of voting stock of the Borrower or
(ii) shall succeed in having a sufficient number of its
nominees elected to the board of directors of the Borrower such that such
nominees so elected (whether new or continuing as directors) shall constitute a
majority of the board of directors of the Borrower.
"Closing Date" shall mean the date of this Agreement.
"Commitment" means, with respect to each Lender, the
obligation of such Lender to make Advances to the Borrower up to an aggregate
principal amount at any one time outstanding equal to such Lender's Applicable
Commitment Percentage of the Total Commitment.
"Compliance Certificate" shall have the meaning set forth in
Section 7.1(c).
"Consolidated Indebtedness" shall mean the Indebtedness of the
Borrower and its Subsidiaries, determined on a consolidated basis in accordance
with GAAP.
"Consolidated Net Cash" shall mean, at any time, the sum of
the cash, Short Term Investments and Long Term Fixed Income Investments of the
Borrower and its Subsidiaries, less Consolidated Indebtedness (excluding forward
contracts for foreign currency).
"Consolidated Net Income" shall mean for any period the net
income (or loss) for such period (before extraordinary items and excluding the
net income of any business entity that is not a Subsidiary in which the Borrower
or one of its Subsidiaries has an ownership interest
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unless such net income shall have actually been received by such company in the
form of cash distributions) of the Borrower and its Subsidiaries after deducting
all operating expenses, depreciation and amortization, Interest Expense, the
interest portion of Financing Lease Obligations, all taxes in respect of income
and profits paid or payable and all other proper deductions, all determined on a
consolidated basis in accordance with GAAP.
"Consolidated Operating Loss" shall mean, for any period,
operating loss for such period of the Borrower and its Subsidiaries, determined
on a consolidated basis in accordance with GAAP.
"Consolidated Tangible Net Worth" shall mean, at any time, the
stockholders' equity of the Borrower and its Subsidiaries determined in
accordance with GAAP excluding the book amount of all minority interests in
Affiliates and any foreign exchange translation adjustment, with no upward
adjustments due to a reevaluation of assets (other than any such upward
adjustment as may be required under generally accepted accounting principles in
connection with the acquisition by the Borrower or any Subsidiary of another
company or entity) minus the following items (without duplication of deductions)
appearing on the balance sheet of the Borrower and its Subsidiaries:
(a) the book amount of all assets (including, without
limitation, goodwill, patents, trademarks, copyrights, organizational expense
and unamortized debt discount) that would be treated as intangibles under
generally accepted accounting principles;
(b) treasury stock; and
(c) any write-up in the book amount of any asset or
Investment subsequent to the Closing Date, resulting from a reevaluation or
reappraisal thereof from the amount entered in accordance with generally
accepted accounting principles by the Borrower or any Subsidiary on its books
with respect to its acquisition of the asset or Investment.
"Consolidated Total Liabilities" shall mean, at any time, all
liabilities of the Borrower and its Subsidiaries on a consolidated basis that in
accordance with GAAP are properly classified as liabilities on the Borrowers'
consolidated balance sheet plus the sum of (i) the face amount of outstanding
Letters of Credit, (ii) sales of receivables described in clause (f) of the
definition of "Indebtedness" below and (iii) Synthetic Leases. In computing such
aggregate liabilities, the "amount" of the liability with respect to any such
sale of receivables shall be the amount of unrecovered capital or principal
investment of the purchaser (other than the Borrower or any of its wholly-owned
Subsidiaries) thereof, excluding amounts representative of yield or interest
earned on such investment, and the "amount" of any Synthetic Lease shall be the
stipulated loss value, termination value or other equivalent amount.
"Costs" shall have the meaning set forth in Section 11.4.
"Default" shall mean any event that, with the lapse of time,
the giving of notice, or both, would become an Event of Default hereunder.
"ERISA" shall have the meaning set forth in Section 5.12.
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"Event of Default" shall have the meaning set forth in Section
9.1.
"Financing Lease" shall mean any lease of the Borrower or a
Subsidiary, as lessee, that is shown or is required to be shown in accordance
with generally accepted accounting principles as a liability on the balance
sheet of the lessee thereunder.
"Financing Lease Obligation" shall mean for any period the
monetary obligation of the lessee under a Financing Lease. The amount of a
Financing Lease Obligation at any date is the amount at which the lessee's
liability under the Financing Lease would be required to be shown on its balance
sheet at such date.
"GAAP" shall mean generally accepted accounting principles.
"Hazardous Substances" shall mean any hazardous waste, as
defined by 42 U.S.C. [sec] 6903(5), any hazardous substances, as defined by 42
U.S.C. [sec] 9601(14), any pollutant or contaminant, as defined by 42 U.S.C.
[sec] 9601(33), or any toxic substance, oil or hazardous materials or other
chemicals or substances regulated by any laws or regulations relating to the
discharge of air pollutants, water pollutants, or processed wastewater.
"Indebtedness" shall mean, for any Person,
(a) all obligations of any other Person the payment or
collection of which such Person has guaranteed (except by reason of endorsement
for collection in the ordinary course of business) or in respect of which such
Person is liable, contingently or otherwise, including, without limitation,
liable by way of agreement to purchase, to provide funds for payment, to supply
funds to or otherwise to invest in such other Person, or otherwise to assure a
creditor against loss,
(b) all obligations of any other Person for borrowed money or
for the deferred purchase price of property or services secured by (or for which
the holder of such indebtedness has an existing right, contingent or otherwise,
to be secured by) any mortgage, or other encumbrance upon or in property
(including, without limitation, accounts and contract rights) owned by such
Person, whether or not such Person has assumed or become liable for the payment
of such indebtedness or obligations,
(c) Financing Lease Obligations of such Person,
(d) every reimbursement obligation of such Person with respect
to letters of credit, bankers' acceptances or similar facilities issued for the
account of such Person,
(e) every obligation of such Person under any Synthetic Lease,
(f) all sales by such Person of (i) accounts or general
intangibles for money due or to become due, (ii) chattel paper, instruments or
documents creating or evidencing a right to payment of money or (iii) other
receivables (collectively "receivables"), whether pursuant to a purchase
facility or otherwise, other than in connection with the disposition of the
business operations of such Person relating thereto or a disposition of
defaulted receivables for collection
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and not as a financing arrangement, and together with any obligation of such
Person to pay any discount, interest, fees, indemnities, penalties, recourse,
expenses or other amounts in connection therewith, and
(g) every obligation of such Person (an "equity related
purchase obligation") to purchase, redeem, retire or otherwise acquire for value
any shares of capital stock of any class issued by such Person, any warrants,
options or other rights to acquire any such shares, or any rights measured by
the value of such shares, warrants, options or other rights.
"Interest Expense" shall mean for any period the aggregate
amount of interest recorded, in accordance with generally accepted accounting
principles, on the financial statements for that period by the Borrower and its
Subsidiaries in respect of Consolidated Indebtedness incurred for borrowed
money.
"Interest Period" shall mean the period designated by the
Borrower as such in the Notice of Borrowing with respect to any LIBOR Loan
pursuant to and subject to the limitations set forth in Section 2.5.
"Interest Rate Determination Date" shall mean the third
Business Day prior to the first day of the related Interest Period for a LIBOR
Loan.
"Interim Maturity Date" shall mean the last day of any
Interest Period.
"International Standby Practices" shall mean International
Standby Practices (ISP98), International Chamber of Commerce Publication No.
590, or any successor code of standby letter of credit practices among banks
adopted by the Issuing Bank in the ordinary course of its business as a standby
letter of credit issuer and in effect at the time of issuance of such Letter of
Credit.
"Investments" shall have the meaning set forth in Section 8.6.
"IPO" shall mean the initial underwritten public offering
pursuant to an effective registration statement under the Securities Act of
1933, as amended, covering the offer and sale of the Borrower's Common Stock for
the account of the Borrower.
"Lenders" shall mean the Lenders as of the date hereof so long
as they maintain Commitments hereunder and any other institutions to which all
or part of the Total Commitment is assigned hereafter.
"Letter of Credit" shall have the meaning set forth in Section
3.1.
"Letter of Credit Application" shall have the meaning set
forth in Section 3.1.
"LIBOR Loan" shall mean an Advance that is specified as such
in the Notice of Borrowing with respect to such Advance and that bears interest
at the adjusted LIBOR Rate.
"LIBOR Rate" shall mean for any Interest Rate Determination
Date, the rate obtained by dividing (i) the quotation offered by the Agent in
the interbank Eurodollar market
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for U.S. dollar deposits of amounts in immediately available funds comparable to
the principal amount of the LIBOR Loan for which the LIBOR Rate is being
determined with a maturity comparable to the Interest Period for which such
LIBOR Rate will apply as of approximately noon (Boston time) three Business Days
prior to the commencement of such Interest Period by (ii) a percentage equal to
100% minus the stated maximum rate of all reserves required to be maintained
against "Eurocurrency liabilities" as specified in Regulation D (or against any
other category of liabilities that includes deposits by reference to which the
interest rate on LIBOR Loans is determined) as applicable on such date to any
member bank of the Federal Reserve System.
"Licenses" shall have the meaning set forth in Section 5.8.
"Lien" shall mean any interest in property securing an
obligation owed to, or a claim by, a Person other than the owner of the
property, whether the interest is based on common law, statute or contract
(including the security interest lien arising from a mortgage, encumbrance,
pledge, conditional sale or trust receipt or a lease, consignment or bailment
for security purposes). For the purposes of this Agreement, the Borrower or a
Subsidiary shall be deemed to be the owner of any property that it has acquired
or holds subject to a Financing Lease or a conditional sale agreement or other
arrangement pursuant to which title to the property has been retained by or
vested in some other Person for security purposes, and such retention or vesting
shall be deemed to be a Lien.
"Loan Documents" shall mean each of this Agreement, the Notes
and any other document or instrument executed by the Borrower or any of its
Affiliates in favor of the Lenders in connection with the transactions
contemplated hereby.
"Long Term Fixed Income Investments" shall mean investment
grade bonds with long-term debt ratings of A-or A3 or higher by at least one
nationally recognized rating agency and maturities of three years or less.
"Maximum Draw" shall mean the maximum aggregate amount from
time to time that beneficiaries may draw under outstanding Letters of Credit, as
such aggregate amount may be reduced from time to time pursuant to the terms of
the Letters of Credit.
"Material Subsidiary" shall mean each domestic Subsidiary of
the Borrower (other than Massachusetts securities corporations) with gross
revenues in excess of 5% of the total gross revenues of the Borrower and its
Subsidiaries, determined on a consolidated basis, or assets in excess of 5% of
the total assets of Borrower and its Subsidiaries, determined on a consolidated
basis, in each case as of the end of Borrower's last fiscal quarter.
"Note" shall mean a Revolving Credit Note.
"Notice of Borrowing" shall have the meaning set forth in
Section 2.2.1.
"Obligations" shall mean, without limitation, any and all
liabilities, debts, and obligations of the Borrower to each of the Lenders, of
each and every kind, nature and description, arising under this Agreement or any
other Loan Document, whether now existing or hereafter incurred. "Obligations"
also means, without limitation, any and all obligations of the
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Borrower to act or to refrain from acting in accordance with the terms,
provisions and covenants of this Agreement or of any other Loan Document.
"Permitted Liens" shall have the meaning set forth in Section
8.2.
"Person" shall mean any natural person, corporation,
unincorporated organization, trust, joint-stock company, joint venture,
association, company, partnership or government, or any agency or political
subdivision of any government.
"Reimbursement Obligation" shall mean the Borrower's
obligation to reimburse the Lender on account of any drawing under any Letter of
Credit as provided in Section 3.2.
"Required Lenders" shall mean, as of any date, Lenders on such
date having Credit Exposures (as defined below) aggregating at least 66-2/3% of
the aggregate Credit Exposures of all the Lenders on such date, provided that a
minimum of two Lenders shall be required at any time. For purposes of the
preceding sentence, the "Credit Exposure" of each Lender shall mean the
aggregate principal amount of the Advances owing to such Lender plus the
aggregate unutilized amounts of such Lender's Commitment.
"Revolver Termination Date" shall mean July 30, 2003 or any
subsequent anniversary thereof if the Total Commitment shall have been renewed
by the Lenders.
"Revolving Credit Facility" shall mean the loan arrangement
described in ARTICLE II of this Agreement, subject to all other applicable terms
of this Agreement.
"Revolving Credit Note" shall have the meaning set forth in
Section 2.3.
"Revolving Credit Outstandings" means, as of any date of
determination, the aggregate principal amount of all Advances then outstanding
and all interest accrued thereon.
"Revolving Loan Account" shall mean the account on the books
of the Agent in the name of the Borrower in which the following shall be
recorded: Advances made by the Lenders to and for the account of the Borrower
pursuant to Section 2 of this Agreement; all other charges, expenses and other
items properly chargeable to the Borrower with respect to such Advances; all
Costs with respect to such Advances; all payments made by the Borrower on
account of Indebtedness evidenced by the Revolving Credit Notes; and other
appropriate debits and credits.
"Short Term Investments" shall mean short term investments as
determined in accordance with GAAP.
"Subsidiary" shall mean any Person of which the Borrower at
the time owns, directly or indirectly, through another Subsidiary or otherwise,
50% or more of the equity interests.
"Synthetic Lease" shall mean any lease that is treated as an
operating lease under GAAP and as a loan or financing for U.S. income tax
purposes.
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"Total Commitment" shall mean, subject to Section 2.1.3, a
principal amount equal to $40,000,000.
"Total Liabilities-to-Tangible Net Worth Ratio" shall have the
meaning set forth in Section 8.10.
"Total Outstandings" shall mean at any time the sum of
Revolving Credit Outstandings, the Maximum Draw and Unpaid Reimbursement
Obligations.
"Uniform Customs" shall mean the Uniform Customs and Practice
for Documentary Credits (1993 Revision), International Chamber of Commerce
Publication No. 500 or any successor version thereto adopted by the Issuing Bank
in the ordinary course of its business as a letter of credit issuer and in
effect at the time of issuance of such Letter of Credit.
"Unpaid Reimbursement Obligation" shall mean any Reimbursement
Obligation for which the Borrower does not reimburse the Lenders on the date
specified in, and in accordance with, Section 3.2.
1.2 Accounting Terms. Accounting terms not specifically defined in this
Agreement shall have the meanings given to them under GAAP.
1.3 Other Definitional Provisions. The words "hereof," "herein" and
"hereunder," and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not any particular provision of this Agreement.
Any ARTICLE, Section, Exhibit or Schedule references are to this Agreement
unless otherwise specified.
ARTICLE II.
REVOLVING CREDIT FACILITY
2.1 Revolving Credit.
2.1.1 Except as provided in Section 2.1.2 hereof and subject
to the terms and conditions of this Agreement, each Lender severally agrees to
make Advances from time to time to the Borrower during the period from the date
hereof to the Revolver Termination Date on a pro rata basis as to the total
Borrowing requested by the Borrower on any day determined by such Lender's
Applicable Commitment Percentage up to but not exceeding the Commitment of such
Lender, provided, however, that the Lenders will not be required and shall have
no obligation to make any such Advance (i) so long as a Default or an Event of
Default has occurred and is continuing or (ii) if the Agent has accelerated the
maturity of any of the Notes as a result of an Event of Default; provided
further, however, that immediately after giving effect to each such Advance, the
aggregate principal amount of Total Outstandings shall not exceed the Total
Commitment. Within such limits and subject to the terms and conditions hereof,
the Borrower may borrow, repay and reborrow under the Revolving Credit Facility
on any Business Day from the Closing Date until, but (as to borrowings and
reborrowings) not including, the Revolver Termination Date. All Advances shall
be due and payable no later than the Revolver Termination Date. Each Advance
shall, at the option of the Borrower, be a Base Rate Loan or a LIBOR Loan
provided, however, that no LIBOR Loan having an Interest Period of 2, 3 or 6
months shall be made at any time in a principal amount of less than $1,250,000
and no LIBOR
10
Loan having an Interest Period of one month shall be made at any time in a
principal amount of less than $1,000,000.
2.1.2 At any time on or prior to the date 90 days after the
Closing, the Borrower may (so long as no Event of Default has occurred and is
continuing) request that either Lender increase its Commitment up to an amount
that would increase the Total Commitment to no more than $50,000,000. If neither
Lender is willing to increase its Commitment, the Borrower may during such
period (so long as no Event of Default has occurred and is continuing) by
irrevocable written notice to the Agent, request on one occasion that the Total
Commitment be increased to an amount not greater than $50,000,000 by engaging
Fleet Securities, Inc. (the "Arranger") to locate one or more additional Lenders
to hold Commitments for the requested increase (the "Syndication"). Fleet shall
cause the Arranger to use commercially reasonable efforts to locate such
additional Lenders including any potential lenders proposed by the Borrower. The
Borrower shall provide all information requested by the Arranger and reasonably
necessary for the successful completion of the Syndication, which information
will be distributed on a confidential basis to selected financial institutions.
In addition, the management of the Borrower, will, at the request of the Agent
or the Arranger, make themselves and their advisors available at reasonable
times to meet with and answer questions of potential lenders. In the event that
the Borrower engages the Arranger, the Borrower shall not offer, or permit any
of its Subsidiaries to offer, any debt or equity securities (other than Common
Stock of the Borrower) prior to the completion of the Syndication except with
the prior written consent of the Agent and the Arranger. The Borrower shall pay
the Arranger an engagement fee as provided in a separate writing between the
Borrower and the Arranger, of which one-half shall be payable on the date the
Arranger is engaged and the balance shall be payable on the date on which a
closing on the Syndication shall occur.
2.2 Advances.
2.2.1 Whenever the Borrower desires to obtain a LIBOR Loan
hereunder, it may request that the Agent provide quotes as of any specified
Interest Rate Determination Date as to the LIBOR Rate for any or all Interest
Periods, and the Agent shall promptly provide such quotes. The Borrower shall
give the Agent prior telecopied or telephone notice (given not later than 11:00
a.m. (Boston time)) on the day of any Borrowing with respect to a Base Rate Loan
and at least three Business Days prior to the day of any Borrowing with respect
to a LIBOR Loan. Each such notice (each a "Notice of Borrowing") shall specify
the principal amount of each Advance to be made, the date of the Borrowing
(which shall be a Business Day), whether each Advance being made is to be
initially maintained as a Base Rate Loan or a LIBOR Loan and, in the case of a
LIBOR Loan, the initial Interest Period applicable thereto. If such notice is
given by telephone, it shall be immediately confirmed in writing. Notice of
receipt of a Notice of Borrowing, together with the amount of each Lender's
portion of an Advance requested thereunder, shall be provided by the Agent to
each Lender by facsimile transmission with reasonable promptness on the day the
Agent receives the Notice of Borrowing. No more than one Base Rate Loan shall be
outstanding at any time, but the Borrower may increase the principal amount of
any Base Rate Loan at any time by giving a Notice of Borrowing as set forth
above.
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2.2.2 No later than 3:00 p.m. on the Advance Date, each
Lender shall, pursuant to the terms and subject to the conditions of this
Agreement, make the amount of the Advance or Advances to be made by it on such
day available by wire transfer to the Agent in the amount of its pro rata share,
determined according to such Lender's Applicable Commitment Percentage of the
Advance or Advances to be made on such day. Such wire transfer shall be directed
to the Agent and shall be in the form of Dollars constituting immediately
available funds. The amount so received by the Agent shall, subject to the terms
and conditions of this Agreement, promptly be made available to the Borrower on
the date so specified by delivery of the proceeds thereof to the Revolving Loan
Account or otherwise as shall be directed in the applicable Notice of Borrowing
and reasonably acceptable to the Agent.
2.2.3 Upon the Interim Maturity Date of any LIBOR Loan,
unless the Borrower (i) shall have given the Agent a Notice of Borrowing in
accordance with Section 2.2.1 requesting that a new LIBOR Loan be made on such
Interim Maturity Date or (ii) shall have repaid such LIBOR Loan on such Interim
Maturity Date, the Borrower shall be deemed to have requested that the Lenders
make a Base Rate Loan to the Borrower on such Interim Maturity Date in an
aggregate principal amount equal to the aggregate principal amount of the LIBOR
Loan maturing on such Interim Maturity Date.
2.2.4 Notwithstanding the notice requirement set forth
above in this Section 2.2, the Lenders agree to make Advances to the Borrower
sufficient to pay to the Issuing Bank any Unpaid Reimbursement Obligations on
the date on which such Reimbursement Obligations become Unpaid Reimbursement
Obligations. The Borrower hereby requests and authorizes the Lenders to make
from time to time such Advances, which shall be Base Rate Loans, by means of
paying Unpaid Reimbursement Obligations. The Borrower acknowledges and agrees
that the making of such Advances shall, in each case, be subject in all respects
to the provisions of this Agreement, including, without limitation, the
limitations set forth in Section 2.1 and the requirements of the applicable
conditions in ARTICLE VI. All actions taken by the Lenders pursuant to the
provisions of this Section 2.2.4 shall be conclusive and binding on the
Borrower.
2.3 Revolving Loan Account. The Advances made by each Lender from time
to time to the Borrower under this Agreement shall be evidenced by a Revolving
Credit Note in the form of Exhibit C hereto (each, a "Revolving Credit Note") in
the amount of such Lender's Commitment. The Advances and the amounts of all
payments on the Revolving Credit Notes shall be recorded by the Agent in the
Revolving Loan Account of the Borrower. The debit balance of the Revolving Loan
Account shall represent the amount of the Borrower's indebtedness to the Lenders
from time to time by reason of Advances and other appropriate charges hereunder.
All statements regarding the Revolving Loan Account shall be deemed to be
accurate absent manifest error or unless objected to by the Borrower within 30
days after receipt. The Borrower agrees to review each such statement promptly
after receipt and to bring any errors or discrepancies to the Agent's attention
promptly.
2.4 Interest.
2.4.1 The Borrower agrees to pay interest in respect of the
unpaid principal amount of each Advance from the date the proceeds thereof are
made available to the Borrower until maturity (whether by acceleration,
voluntary prepayment or otherwise) as follows. Each
12
Advance shall bear interest at the Base Rate in effect from time to time unless
the Borrower elects and qualifies to pay interest on such Advance at the LIBOR
Rate plus the Applicable Margin; provided, however, that the Applicable Margin
shall not be less than 1.50% prior to the first day of the month following the
month in which the Borrower shall deliver to the Lenders the financial
statements required by Section 7.1(b) for the year ended December 31, 2002 and
related Compliance Certificate.
2.4.2 Overdue principal and (to the extent permitted by
law) overdue interest in respect of each Base Rate Loan and each LIBOR Loan (to
the extent not converted into a Base Rate Loan) shall bear interest, payable on
demand, after as well as before judgment, at a rate per annum equal to the Base
Rate in effect from time to time plus 2% per annum.
2.4.3 Interest shall accrue from and including the date of
any Advance and shall be payable by the Borrower on each Advance in arrears on
the last day of each of the Borrower's fiscal quarters, on any prepayment (on
the amount prepaid), on any maturity date (whether by acceleration or
otherwise), and after such maturity, on demand. Interest shall be calculated on
the basis of actual days elapsed and a 360-day year.
2.5 Interest Periods. At the time it gives any Notice of Borrowing with
respect to a LIBOR Loan, the Borrower shall elect the Interest Period applicable
to the related Advance, which Interest Period shall, at the option of the
Borrower, be a period of 1, 2, 3 or 6 months. Notwithstanding anything to the
contrary contained herein:
(i) if any Interest Period begins on a day for
which there is no numerically corresponding day in the
calendar month at the end of such Interest Period, such
Interest Period shall end on the last Business Day of such
calendar month;
(ii) if any Interest Period would otherwise
expire on a day that is not a Business Day, such Interest
Period shall expire on the next succeeding Business Day;
provided that if any Interest Period would otherwise expire
on the day that is not a Business Day but is a day of the
month after which no further Business Day occurs in such
month, such Interest Period shall expire on the next preceding
Business Day;
(iii) no Interest Period shall extend beyond the
Revolver Termination Date.
2.6 Unused Commitment Fee. For the period beginning on the Closing Date
and ending on the Revolver Termination Date, the Borrower agrees to pay to the
Agent, for the pro rata benefit of the Lenders based on their Applicable
Commitment Percentages, an unused commitment fee equal to the Applicable Margin
multiplied by the average daily amount by which (a) the Total Commitment exceeds
(b) the Total Outstandings less all accrued and unpaid interest. Such fees shall
be due in arrears on the last Business Day of each March, June, September and
December commencing September 30, 2002 to and on the Revolver Termination Date.
Notwithstanding the foregoing, so long as any Lender fails to make available any
portion of its Commitment when requested, such Lender shall not be entitled to
receive payment of its
13
pro rata share of such fee for so long as such Lender shall not have made
available such portion. Such fee shall be calculated on the basis of a year of
360 days for the actual number of days elapsed.
2.7 Deficiency Advances. No Lender shall be responsible for any default
of any other Lender in respect to such other Lender's obligation to make any
Advance nor shall the Commitment of any Lender hereunder be increased as a
result of such default of any other Lender. Without limiting the generality of
the foregoing, in the event any Lender shall fail to advance funds to the
Borrower as herein provided, the Agent may in its discretion, but shall not be
obligated to, advance under the Revolving Credit Note in its favor as a Lender
all or any portion of such amount or amounts (each, a "deficiency advance") and
shall thereafter be entitled to payments of principal of and interest on such
deficiency advance in the same manner and at the same interest rate or rates to
which such other Lender would have been entitled had it made such advance under
its Revolving Credit Note; provided that, upon payment to the Agent from such
other Lender of the entire outstanding amount of each such deficiency advance,
together with accrued and unpaid interest thereon, from the most recent date or
dates interest was paid to the Agent by the Borrower on each Advance comprising
the deficiency advance at the rate of interest payable by the Borrower and
payment by such other Lender to Agent of customary late fees, then such payment
shall be credited against the applicable Revolving Credit Note of the Agent in
full payment of such deficiency advance and the Borrower shall be deemed to have
borrowed the amount of such deficiency advance from such other Lender as of the
most recent date or dates, as the case may be, upon which any payments of
interest were made by the Borrower thereon.
ARTICLE III.
LETTER OF CREDIT FACILITY
3.1 Letter of Credit Commitment.
3.1.1 Subject to the terms and conditions hereof, Fleet
(the "Issuing Bank") at the risk of the Lenders to the extent of their
Applicable Commitment Percentages, in reliance upon the representations and
warranties of the Borrower contained herein, shall issue, extend and renew from
time to time from the date hereof until but not including the date which is
fourteen (14) days prior to the then scheduled Revolver Termination Date, for
the account of the Borrower, standby and documentary letters of credit (each a
"Letter of Credit"), in such form as may be requested by the Borrower and agreed
to by the Issuing Bank so long as (i) the Borrower shall have executed and
delivered a letter of credit application on the Issuing Bank's customary form (a
"Letter of Credit Application"), (ii) after giving effect to such request, the
sum of the aggregate Maximum Draw and all Unpaid Reimbursement Obligations shall
not exceed $10,000,000 at any one time and (iii) the sum of the principal amount
of Total Outstandings shall not exceed the Total Commitment.
3.1.2 Each Letter of Credit Application shall be completed
to the satisfaction of the Issuing Bank at least two Business Days prior to the
desired date of issuance. In the event that any provision of any Letter of
Credit Application shall be inconsistent with any provision of this Agreement,
then the provisions of this Agreement shall, to the extent of any such
inconsistency, govern.
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3.1.3 Each Letter of Credit issued, extended or renewed
hereunder shall, among other things, (a) provide for the payment of sight drafts
for honor thereunder when presented in accordance with the terms thereof and
when accompanied by the documents described therein, and (b) have an expiry date
no later than the date which is fourteen (14) days (or, if the Letter of Credit
is confirmed by a confirmer or otherwise provides for one or more nominated
persons, forty-five (45) days) prior to the Revolver Termination Date. Each
Letter of Credit so issued, extended or renewed shall be subject to the Uniform
Customs or, in the case of a standby Letter of Credit, either the Uniform
Customs or the International Standby Practices. The Issuing Bank shall give the
other Lenders reasonably prompt notice of the issuance and amount of each Letter
of Credit and the expiration of each Letter of Credit.
3.2 Reimbursement Obligation of the Borrower. In order to induce the
Lenders to issue, extend and renew each Letter of Credit, the Borrower hereby
agrees to reimburse the Lenders for or to pay to the Lenders with respect to
each Letter of Credit issued, extended or renewed by the Lenders hereunder,
3.2.1 except as otherwise expressly provided in Section
3.2.2, on each date that any draft presented under such Letter of Credit is
honored by the Issuing Bank, or the Issuing Bank otherwise makes a payment with
respect thereto, (i) the amount paid by the Issuing Bank under or with respect
to such Letter of Credit, and (ii) the amount of any taxes, fees, charges or
other costs and expenses whatsoever incurred by the Issuing Bank in connection
with any payment made by the Issuing Bank under, or with respect to, such Letter
of Credit;
3.2.2 upon the termination of the Commitment, or the
acceleration of the Reimbursement Obligations with respect to all Letters of
Credit in accordance with ARTICLE IX an amount equal to the Maximum Draw, which
amount shall be held by the Issuing Bank as cash collateral for all
Reimbursement Obligations.
Unless funded by an Advance, each such payment shall be made to the
Issuing Bank at its office at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ in
immediately available funds. Interest on any and all amounts remaining unpaid by
the Borrower under this Section 3.2 and not required to be funded by an Advance
pursuant to Section 2.2.4 at any time from the date such amounts become due and
payable (whether as stated in this Section 3.2, by acceleration or otherwise)
until payment in full (whether before or after judgment) shall be payable to the
Issuing Bank on demand at the rate specified in Section 2.4.2 following an Event
of Default.
3.3 Letter of Credit Payments. If any draft shall be presented or other
demand for payment shall be made under any Letter of Credit, the Issuing Bank
shall notify the Borrower of the date and amount of the draft presented or
demand for payment and of the date and time when it expects to pay such draft or
honor such demand for payment. The responsibility of the Issuing Bank to the
Borrower shall be only to determine that the documents (including each draft)
delivered under each Letter of Credit in connection with such presentment shall
be in conformity in all material respects with such Letter of Credit.
3.4 Obligations Absolute. The Borrower's obligations under this ARTICLE
III shall be absolute and unconditional under any and all circumstances and
irrespective of the occurrence of any Default or Event of Default or any
condition precedent whatsoever or any setoff,
15
counterclaim or defense to payment which the Borrower may have or have had
against the Lenders or any beneficiary of a Letter of Credit. The Borrower
further agrees with the Lenders that the Lenders shall not be responsible for,
and the Reimbursement Obligations shall not be affected by, among other things,
the validity or genuineness of documents or of any endorsements thereon, even if
such documents should in fact prove to be in any or all respects invalid,
fraudulent or forged, or any dispute between or among the Borrower, the
beneficiary of any Letter of Credit or any financing institution or other party
to which any Letter of Credit may be transferred or any claims or defenses
whatsoever of the Borrower against the beneficiary of any Letter of Credit or
any such transferee. The Lenders shall not be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message or
advice, however transmitted, in connection with any Letter of Credit. The
Borrower agrees that any action taken or omitted by the Lenders under or in
connection with each Letter of Credit and the related drafts and documents, if
done in good faith, shall be binding upon the Borrower and shall not result in
any liability on the part of the Lenders to the Borrower.
3.5 Reliance by Issuer. To the extent not inconsistent with Section
3.4, the Lenders shall be entitled to rely, and shall be fully protected in
relying upon, any Letter of Credit, draft, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document believed by them to be genuine and
correct and to have been signed, sent or made by the proper person or entity and
upon advice and statements of legal counsel, independent accountants and other
experts selected by the Lenders.
3.6 Letter of Credit Fees. The Borrower shall pay a fee to the Lenders
in respect of each Letter of Credit equal to the Applicable Margin per annum
multiplied by the face amount of such Letter of Credit. In addition, the
Borrower shall pay to the Issuing Bank for its own account a fee of 1/8% per
annum of the face amount of each Letter of Credit. Both fees shall be payable in
arrears on the last day of each of the Borrower's fiscal quarters, on any
prepayment (on the amount prepaid), on any maturity date (whether by
acceleration or otherwise) and after such maturity, on demand.
ARTICLE IV.
ADDITIONAL TERMS
4.1 Payments.
4.1.1 The Borrower shall have the right to prepay the
Notes, in whole at any time or in part from time to time, without premium or
penalty, provided that, except as set forth in Section 4.3, no Advance, either
in whole or in part, may be prepaid on the Advance Date of such Advance. The
Borrower shall give notice (by telex or telecopier, or by telephone (confirmed
in writing promptly thereafter)) to the Agent of each proposed prepayment
hereunder prior to 11:00 a.m. (Boston time), (x) with respect to Base Rate
Loans, upon the Business Day of the proposed prepayment and (y) with respect to
LIBOR Loans, at least three Business Days prior to the Business Day of the
proposed prepayment, which notice in each case shall specify the proposed
prepayment date (which shall be a Business Day), the aggregate principal amount
of the proposed prepayment and which Advances are to be prepaid. LIBOR Loans
that are voluntarily prepaid before the last day of the applicable Interest
Period shall be subject to the
16
additional compensation requirements set forth in Section 4.3, and each
prepayment of a LIBOR Loan shall be in an aggregate principal amount of not less
than the total principal amount outstanding at such time under such LIBOR Loan.
If at any time the Total Outstandings exceed $40,000,000, the Borrower will
immediately pay the amount of such excess to the Agent.
4.1.2 All payments of principal and interest due under the
Notes (including prepayments), and any other amounts owing to the Lenders under
this Agreement shall be made by the Borrower not later than 2:30 p.m., Boston
time, on the day due in lawful money of the United States of America to the
Agent at its Boston, Massachusetts office in immediately available funds. The
Borrower hereby authorizes the Agent to charge such payments as they become due,
if not otherwise paid by the Borrower, to any account of the Borrower with the
Agent as the Agent may elect.
4.1.3 Whenever any payment to be made hereunder or under
any other Loan Document shall be stated to be due on a day that is not a
Business Day, such payment may be made on the next succeeding Business Day, and
such extension of time shall in such case be included in computing interest or
other fees or charges provided for under this Agreement or any other Loan
Document; provided, however, that with respect to LIBOR Loans, if the next
succeeding Business Day falls in another calendar month, such payment shall be
made on the next preceding Business Day.
4.1.4 All payments made by the Borrower on the Notes shall
be applied by the Agent (a) first, to the payment of Costs with respect to the
Notes, (b) second, to the payment of accrued and unpaid interest on the Notes,
until all such accrued interest has been paid, and (c) third, to the payment of
the unpaid principal amount of the Notes. Except as otherwise provided herein,
(a) each payment on account of the principal of and interest on the Notes and
the fees described in Sections 2.6 and 3.6 shall be made to the Agent for the
account of the Lenders pro rata based on their Applicable Commitment
Percentages, (b) all payments to be made by the Borrower for the account of each
of the Lenders on account of principal, interest and fees, shall be made without
diminution, setoff, recoupment or counterclaim, and (c) the Agent will promptly
distribute to the Lenders in immediately available funds payments received in
fully collected, immediately available funds from the Borrower.
4.1.5 The Borrower may elect to reduce or terminate the
Commitment by a minimum principal amount of $5,000,000 and integral multiples of
$1,000,000 but not by an amount greater than the Maximum Draw at such time, upon
written notice to the Agent given by 10:00 a.m. Boston time at least five days
prior to the date of such reduction or termination. The Borrower shall not be
entitled to reinstate the Commitment following such reduction or termination.
4.1.6 If the Borrower sells any of its capital stock or
other equity interests or any warrants, rights or options to acquire its capital
stock or other equity interests other than sales of common stock upon the
exercise of stock options held by employees and directors and sales of common
stock under Borrower's employee stock purchase plan, the Borrower shall prepay
its current Advances by the amount of the excess of the gross cash proceeds
received from such sale after deduction of reasonable and customary transaction
expenses (including without limitation, underwriting discounts and commissions)
incurred in connection with such sale.
17
4.2 Capital Adequacy.
4.2.1 If, after the date of this Agreement, a Lender shall
have reasonably determined in good faith that the adoption or effectiveness
after the date hereof of any applicable law, rule or regulation regarding
capital adequacy, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by such Lender with any request or directive regarding capital adequacy (whether
or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of materially reducing the rate
of return on such Lender's capital or assets as a consequence of its commitments
or obligations hereunder to a level below that which such Lender could have
achieved but for such adoption, effectiveness, change or compliance (taking into
consideration such Lender's then current policies with respect to capital
adequacy), then from time to time, subject to Section 4.2.2, within 15 days
after demand, the Borrower shall pay to the Agent for the account of such Lender
such additional amount or amounts as will compensate such Lender for such
reduction (after such Lender shall have allocated the same fairly and equitably
among all of its customers or any class generally affected thereby).
4.2.2 The Agent will notify the Borrower of any event
occurring after the date of this Agreement that will entitle a Lender to any
additional payment under this Section 4.2 as promptly as practicable. The Agent
will furnish to the Borrower with such notice a certificate signed by an officer
of the Lender requesting payment certifying that such Lender is entitled to
payment under this Section 4.2 and setting forth the basis (in reasonable
detail) and the amount of each request by such Lender for any additional payment
pursuant to this Section 4.2. Such certificate shall be conclusive in the
absence of manifest error. The Borrower shall not be obligated to compensate
such Lender pursuant to this Section for amounts accruing prior to the date that
is 180 days before such Agent notifies the Borrower of its obligations to
compensate such Lender for such amounts.
4.3 Special Provisions Governing LIBOR Loans. Notwithstanding any
other provisions of this Agreement, the following provisions shall govern with
respect to LIBOR Loans as to the matters covered:
4.3.1 Increased Costs, Illegality, etc. (a) In the event
that the Agent shall have determined (which determination shall, if made in good
faith and absent manifest error, be final, conclusive and binding upon all
parties):
(i) on any Interest Rate Determination Date,
that by reason of any changes arising after the date of this
Agreement affecting the interbank Eurodollar market, adequate
and fair means do not exist for ascertaining the applicable
interest rate on the basis provided for in the definition of
LIBOR Rate; or
(ii) at any time during any Interest Period, that
the Lenders shall incur increased costs (including taxes) or
reductions in the amounts received or receivable hereunder
with respect to a LIBOR Loan by reason of (x) any change since
the Interest Rate Determination Date for the Interest Period
in question in any applicable law or governmental rule,
regulation, guideline or order (or any
18
interpretation thereof and including the introduction of any
new law or governmental rule, regulation, guideline or order)
(such as, for example but not limited to, a change in official
reserve requirements, but excluding reserve requirements that
have been included in calculating the LIBOR Rate for such
Interest Period) and/or (y) other circumstances affecting any
Lender, the interbank Eurodollar market or the position of any
Lender in the relevant market; or
(iii) at any time, that the making or continuance
of any LIBOR Loan has become unlawful by compliance by the
Lenders in good faith with any law, governmental rule,
regulation, guideline or order, or has become impracticable as
a result of a contingency occurring after the date of this
Agreement;
then and in any such event, the Agent shall promptly after making such
determination give notice (by telephone confirmed in writing) to the Borrower of
such determination. Thereafter (x) in the case of clause (i) above, any Notice
of Borrowing given by the Borrower with respect to a LIBOR Loan that has not yet
been incurred shall be deemed rescinded by the Borrower and LIBOR Loans shall no
longer be available until such time as the Agent notifies the Borrower that the
circumstances giving rise to such notice no longer exist or that,
notwithstanding such circumstances, LIBOR Loans will again be made available
hereunder, (y) in the case of clause (ii), the Borrower shall pay to the Agent,
upon written demand therefor (but only with respect to any LIBOR Loan made
pursuant to a Notice of Borrowing issued after the giving of the written notice
that LIBOR Loans will again be made available hereunder referred to in clause
(x) above), such additional amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as the Agent in its sole
discretion shall determine) as shall be required to compensate the Lenders for
such increased cost or reduction in amount received (a written notice as to
additional amounts owed the Lenders, showing the basis for such calculation
thereof, shall be given to the Borrower by the Agent and shall, absent manifest
error, be final, conclusive and binding upon the parties hereto), and (z) in the
case of clause (iii), the Borrower shall take one of the actions specified in
Section 4.3.1(b) as promptly as possible and, in any event, within the time
period required by law.
(b) At any time that any LIBOR Loan is affected by
the circumstances described in Section 4.3.1(a)(ii) or (iii), the Borrower may
(and in the case of a LIBOR Loan affected pursuant to Section 4.3.1(a)(iii)
shall) either (x) if the affected LIBOR Loan is then being made, withdraw the
related Notice of Borrowing by giving the Agent telephonic (confirmed in
writing) notice thereof on the same date that the Borrower was notified by the
Agent pursuant to Section 4.3.1(a), or (y) if the affected LIBOR Loans are then
outstanding, upon at least three Business Days' written notice to the Agent,
require the Agent to convert each LIBOR Loan so affected into a Base Rate Loan.
4.3.2 Compensation. The Borrower shall compensate the
Lenders, upon the Agent's written request (which request shall set forth the
basis for requesting such amounts), for all reasonable losses, expenses and
liabilities (including, without limitation, any interest paid by the Lender to
lenders of funds borrowed by it to make or carry its LIBOR Loans to the extent
not recovered by the Lenders in connection with the re-employment of such
funds) and any loss sustained by any Lender in connection with the re-
employment of the funds (including, without limitation, a return on such re-
employment that would result in such Lender's receiving less than
19
it would have received had such LIBOR Loan remained outstanding until the last
day of the Interest Period applicable to such LIBOR Loan) that such Lender may
sustain: (i) if for any reason (other than a default by or negligence of any
Lender) a LIBOR Loan is not advanced on a date specified therefor in a Notice of
Borrowing (unless timely withdrawn pursuant to Section 4.3.1(b)(x) above), (ii)
if any payment or prepayment of any LIBOR Loans occurs for any reason whatsoever
(including, without limitation, by reason of Section 4.3.1(b)) on a date that is
prior to the last day of an Interest Period applicable thereto, (iii) if any
prepayment of any of its LIBOR Loans is not made on the date specified in a
notice of payment given by the Borrower pursuant to Section 4.1 or (iv) as a
consequence of an election made by the Borrower pursuant to Section 4.3.1(b)(y).
4.4 Taxes. All payments made by the Borrower under this Agreement and
any Notes shall be made free and clear of, and without deduction or withholding
for or on account of, any present or future income, stamp or other taxes,
levies, imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any governmental
authority, excluding net income taxes and franchise taxes (imposed in lieu of
net income taxes) imposed on any Lender as a result of a present or former
connection between such Lender and the jurisdiction of the governmental
authority imposing such tax or any political subdivision or taxing authority
thereof or therein (other than any such connection arising solely from such
Lender's having executed, delivered or performed its obligations or received a
payment under, or enforced, this Agreement or any Note). If any such
non-excluded taxes, levies, imposts, duties, charges, fees deductions or
withholdings ("Non-Excluded Taxes") are required to be withheld from any amounts
payable to the Lenders hereunder or under any Note, the amounts so payable to
the Lenders shall be increased to the extent necessary to yield to the Lenders
(after payment of all Non-Excluded Taxes) interest or any such other amounts
payable hereunder at the rates or in the amounts specified in this Agreement.
Whenever any Non-Excluded Taxes are payable by the Borrower, as promptly as
possible thereafter the Borrower shall send to the Agent a certified copy of an
original official receipt received by the Borrower showing payment thereof. If
the Borrower fails to pay any Non-Excluded Taxes when due to the appropriate
taxing authority or fails to remit to the Agent the required receipts or other
required documentary evidence, the Borrower shall indemnify the Lenders for any
incremental taxes, interest or penalties that may become payable to any Lenders
as a result of any such failure. The agreements in this subsection shall survive
the termination of this Agreement and the payment of the Advances and all other
amounts payable hereunder.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES OF THE BORROWER
In order to induce the Lenders to enter into this Agreement and to make
the loans provided for herein, the Borrower makes the following representations
and warranties to the Lenders, all of which shall survive the execution and
delivery of this Agreement and the Notes.
5.1 Organization, Existence and Power. Each of the Borrower and each
Material Subsidiary is duly incorporated, validly existing and in good standing
under the laws of the jurisdiction of its incorporation. Each of the Borrower
and each Material Subsidiary has the corporate power necessary to conduct the
business in which it is engaged, to own the properties owned by it and to
consummate the transactions contemplated by the Loan Documents. Each of
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the Borrower and each Material Subsidiary is duly qualified or licensed to
transact business in all places where the nature of the properties owned by it
or the business conducted by it makes such qualification necessary and where the
failure to be so qualified or licensed would have a material adverse effect upon
the consolidated financial condition, assets or results of operations of the
Borrower and its Subsidiaries taken as a whole.
5.2 Authorization of Loan Documents; Binding Effect. The execution and
delivery of this Agreement and the other Loan Documents and the performance of
the transactions contemplated hereby and thereby have been duly authorized by
all necessary corporate actions of the Borrower and each Material Subsidiary.
Each of the Loan Documents constitutes the legal, valid and binding obligation
of the Borrower, enforceable against the Borrower in accordance with its terms.
Each Guaranty constitutes the legal, valid and binding obligation of the
Material Subsidiary executing it, enforceable against such Material Subsidiary
in accordance with its terms.
5.3 Authority. The Borrower has all requisite corporate power and
authority to execute, deliver and perform its obligations under the Loan
Documents. Each Material Subsidiary has all requisite corporate power and
authority to execute, deliver and perform its obligations under its Guaranty.
Neither the authorization, execution, delivery, or performance by the Borrower
of this Agreement or of any other Loan Document nor the authorization,
execution, delivery, or performance by each Material Subsidiary of its Guaranty
nor the performance of the transactions contemplated hereby or thereby violates
or will violate any provision of the corporate charter or by-laws of the
Borrower or any Material Subsidiary, or does or will, with the passage of time
or the giving of notice or both, result in a breach of or a default under, or
require any consent under or result in the creation of any lien, charge or
encumbrance upon any property or assets of the Borrower or any Material
Subsidiary pursuant to, any material instrument, agreement or other document to
which the Borrower or any Material Subsidiary is a party or by which the
Borrower, any Material Subsidiary or any of their properties may be bound or
affected.
5.4 Capital Structure. The number of shares of stock of which the
Borrower's authorized capital stock consists, the par value per share of such
stock, the number of shares of such stock that have been issued and are
outstanding and the number of shares that have been issued and are held by the
Borrower as treasury shares are all disclosed on the Disclosure Schedule. Set
forth on the Disclosure Schedule is a complete and accurate list of all
Subsidiaries of the Borrower. The Disclosure Schedule indicates the
jurisdiction of incorporation or organization of each of the Subsidiaries, the
number of shares or units of each class of capital stock or other equity of the
Subsidiaries authorized, and the number of such shares or units outstanding and
the percentage of each class of such equity owned (directly or indirectly) by
the Borrower. No shares of stock or units of equity interests of the Borrower or
any of its Subsidiaries are covered by outstanding options, warrants, rights of
conversion or purchase or similar rights granted or created by the Borrower
except as set forth on the Disclosure Schedule. All the outstanding capital
stock of the Borrower has been validly issued and is fully paid and
nonassessable. All the stock or units of equity interests of the Borrower's
Subsidiaries that are owned by the Borrower or any Subsidiary of the Borrower
are owned free and clear of all mortgages, deeds of trust, pledges, liens,
security interests and other charges or encumbrances. The Disclosure Schedule
sets forth the name of each Material Subsidiary.
21
5.5 Financial Condition. The audited consolidated balance sheet of the
Borrower and its Subsidiaries dated as of December 31, 2001 and the unaudited
consolidated balance sheet of the Borrower and its Subsidiaries dated as of
March 31, 2002 (the "Balance Sheet Date") and the related audited and unaudited,
respectively, statements of operations, cash flows and stockholders' equity of
the Borrower and its Subsidiaries for the periods ending on such dates,
including any related notes (the "Financial Statements"), all of which were
heretofore furnished to the Lenders, are true, correct and complete in all
material respects and fairly present in all material respects the financial
condition of the Borrower and its Subsidiaries as of the date of each such
statement and have been prepared in accordance with generally accepted
accounting principles consistently applied throughout the periods involved
except, in the case of unaudited statements, for the absence of footnotes and
subject to normal year-end adjustments that shall not be materially adverse in
the aggregate. Other than as reflected in such Financial Statements and except
for liabilities incurred in the ordinary course of business since the date
thereof, the Borrower and its Material Subsidiaries have no Indebtedness that is
or would be material to the financial condition of the Borrower, nor any
material unrealized or unanticipated losses from any commitments. Since the
Balance Sheet Date there has been no material adverse change in the consolidated
financial condition (as set forth in the Financial Statements) or results of
operations of the Borrower and its Subsidiaries taken as a whole.
5.6 Pending Litigation. Except as set forth in the Disclosure Schedule,
there are no suits or proceedings pending or, to the knowledge of the Borrower,
threatened before any court or arbitration tribunal or by or before any
governmental or regulatory authority, commission, bureau or agency or public
regulatory body against the Borrower or any Material Subsidiary that if
adversely determined would have a material adverse effect on the consolidated
financial condition, assets or results of operations of the Borrower and its
Subsidiaries taken as a whole.
5.7 Certain Agreements; Material Contracts. Neither the Borrower nor
any Material Subsidiary is a party to any agreement or instrument or subject to
any court order or governmental decree adversely affecting in any material
respect the business, properties, assets or financial condition of the Borrower
and its Subsidiaries taken as a whole.
5.8 Authorization, Etc. All authorizations, consents, approvals,
accreditations, certifications and licenses required under the corporate
charters or by-laws of the Borrower and its Material Subsidiaries or under
applicable law or regulation for the ownership or operation of the property
owned or operated by the Borrower or any Material Subsidiary or the conduct of
any business or activity conducted by the Borrower or any Material Subsidiary,
including provision of services for which reimbursement is made by third party
payors, other than authorizations, consents, approvals, accreditations,
certifications or licenses the failure to obtain and/or maintain which would not
have a material adverse effect on the consolidated financial condition, assets
or results of operations of the Borrower and its Subsidiaries taken as a whole
(collectively, "Licenses") have been duly issued and are in full force and
effect. The Borrower and its Material Subsidiaries have fulfilled and performed
all of their material obligations with respect to such Licenses (to the extent
now required to be fulfilled or performed) and no event has occurred that would
allow, with or without the passage of time or the giving of notice or both,
revocation or termination thereof or would result in any other material
impairment of the rights of the holder of any such License. All filings or
registrations with any governmental or regulatory authority required for the
conduct of the business or activity conducted by the
22
Borrower or any Material Subsidiary have been made, other than any such filings
or registrations as to which the failure to make same would not have a material
adverse effect on the consolidated financial condition, assets or results of
operations of the Borrower and its Subsidiaries, taken as a whole. Except as
expressly contemplated hereby, no approval, consent or authorization of or
filing or registration with any governmental commission, bureau or other
regulatory authority or agency is required with respect to the execution,
delivery or performance of any of the Loan Documents.
5.9 No Violation. The execution, delivery and performance by the
Borrower of the Loan Documents and by each Material Subsidiary of its Guaranty
do not and will not violate any provision of law or regulation applicable to the
Borrower or any Material Subsidiary, or any writ, order or decree of any court
or governmental or regulatory authority or agency applicable to the Borrower or
any Material Subsidiary. Neither the Borrower nor any Material Subsidiary is in
default, nor has any event occurred that with the passage of time or the giving
of notice, or both, would constitute a default, in the performance, observance
or fulfillment of any of the obligations, covenants or conditions contained in
any agreement, instrument or other document to which the Borrower or any
Material Subsidiary is a party, which default would have a material adverse
effect on the consolidated assets, financial condition or results of operations
of the Borrower and its Subsidiaries, taken as a whole. Neither the Borrower nor
any Material Subsidiary is in violation of any applicable federal, state or
local law, rule or regulation or any writ, order or decree, which violation
would have a material adverse effect on the consolidated assets, financial
condition or results of operations of the Borrower and its Subsidiaries, taken
as a whole. Except as otherwise set forth in the Disclosure Schedule under the
caption "Litigation," neither the Borrower nor any Material Subsidiary has
received notice of any violation of any federal, state or local environmental
law, rule or regulation or assertion that the Borrower or any Material
Subsidiary has any obligation to clean up or contribute to the cost of cleaning
up any waste or pollutants.
5.10 Payment of Taxes. The Borrower and its Subsidiaries have properly
prepared and filed or caused to be properly prepared and filed all federal tax
returns and all material state and local tax returns that are required to be
filed and have paid all taxes shown thereon to be due and all other taxes,
assessments and governmental charges or levies imposed upon the Borrower and its
Subsidiaries, their income or profits or any properties belonging to the
Borrower. No extensions of any statute of limitations are in effect with respect
to any tax liability of the Borrower or any Subsidiary of the Borrower. No
deficiency assessment or proposed adjustment of the federal income taxes of the
Borrower or any Subsidiary of the Borrower is pending and the Borrower has no
knowledge of any proposed liability of a substantial nature for any tax to be
imposed upon any of its properties or assets.
5.11 Transactions With Affiliates, Officers, Directors and 1%
Shareholders. Except as set forth on the Disclosure Schedule, neither the
Borrower nor any Material Subsidiary has any Indebtedness to or material
contractual arrangement or understanding with any Affiliate, officer or director
of the Borrower or any Material Subsidiary, nor any shareholder holding of
record at least 1% of the equity of the Borrower or any Material Subsidiary nor,
to the best of the Borrower's knowledge (without independent inquiry), any of
their respective relatives.
23
5.12 ERISA. Neither the Borrower nor any Material Subsidiary has ever
established or maintained any funded employee pension benefit plan as defined
under Section 3(2)(A) of the Employee Retirement Income Security Act of 1974, as
amended and in effect on the date hereof ("ERISA"), other than the plans
described on the Disclosure Schedule. No employee benefit plan established or
maintained, or to which contributions have been made, by the Borrower or any
Subsidiary of the Borrower that is subject to Part 3 of Title I-B of ERISA, had
an accumulated funding deficiency (as such term is defined in Section 302 of
ERISA) as of the last day of the fiscal year of such plan ended most recently
prior to the date hereof, or would have had an accumulated funding deficiency
(as so defined) on such day if such year were the first year of the plan to
which Part 3 of Title I-B of ERISA applied. No material liability to the
Pension Benefit Guaranty Corporation has been incurred or is expected by the
Borrower or any Material Subsidiary to be incurred by it or any Subsidiary of
the Borrower with respect to any such plan or otherwise. The execution, delivery
and performance of this Agreement and the other Loan Documents will not involve
on the part of the Borrower or any Material Subsidiary any prohibited
transaction within the meaning of ERISA or Section 4975 of the Internal Revenue
Code. Neither the Borrower nor any Material Subsidiary has ever maintained,
contributed to or been obligated to contribute to any "multiemployer plan," as
defined in Section 3(37) of ERISA. Neither the Borrower nor any Material
Subsidiary has ever incurred any "withdrawal liability" calculated under Section
4211 of ERISA, and there has been no event or circumstance that would cause the
Borrower or any Material Subsidiary to incur any such liability.
5.13 Ownership of Properties; Liens. The Borrower and its Subsidiaries
have good and marketable title to all their material properties and assets, real
and personal, that are now carried on their books, including, without
limitation, those reflected in the Financial Statements (except those disposed
of in the ordinary course since the date thereof), and have valid leasehold
interests in their properties and assets, real and personal, which they purport
to lease, subject in either case to no mortgage, security interest, pledge,
lien, charge, encumbrance or title retention or other security agreement or
arrangement of any nature whatsoever other than Permitted Liens and those
specified in the Disclosure Schedule. All of the material leasehold interests
and material obligations with respect to real property of the Borrower and its
Subsidiaries are described on the Disclosure Schedule.
5.14 Employment Matters. Except as set forth on the Disclosure
Schedule, there are no material grievances, disputes or controversies pending
or, to the knowledge of the Borrower, threatened between the Borrower and its
employees or any Material Subsidiary and its employees, nor is any strike, work
stoppage or slowdown pending or threatened against the Borrower or any Material
Subsidiary.
5.15 Insurance. Each of The Borrower and each Material Subsidiary
maintains in force fire, casualty, comprehensive liability and other insurance
covering its properties and business that is adequate and customary for the type
and scope of its properties and business.
5.16 Indebtedness. Except as reflected in the Financial Statements or
set forth in the Disclosure Schedule, and other than Indebtedness incurred in
the ordinary course of business since the Balance Sheet Date, the Borrower and
its Material Subsidiaries have no outstanding Indebtedness.
24
5.17 Securities Law Compliance. Neither the Borrower nor any Material
Subsidiary is an "investment company" as defined in the Investment Company Act
of 1940, as amended. All of the Borrower's and each Material Subsidiary's
outstanding stock was offered, issued and sold in compliance with all applicable
state and federal securities laws.
5.18 Accuracy of Information. None of the information furnished to the
Lenders by or on behalf of the Borrower or any Material Subsidiary for purposes
of this Agreement or any Loan Document or any transaction contemplated hereby or
thereby contains, and none of such information hereinafter furnished will
contain any material misstatement of fact, nor does or will any such information
omit any material fact necessary to make such information not misleading at such
time.
ARTICLE VI.
CONDITIONS TO ADVANCES
The Lenders shall not be obligated to make any Advances unless the
following conditions have been satisfied:
6.1 Each Advance. The obligations of the Lenders to make each Advance
are subject to the following conditions precedent, each of which shall have been
met or performed on or before the Advance Date or the Closing Date, as the case
may be:
(a) No Default. No Default or Event of Default shall have
occurred and be continuing or will occur upon the making of the Advance.
(b) Correctness of Representations. The representations
and warranties made by the Borrower in this Agreement shall be true and correct
with the same force and effect as though such representations and warranties had
been made on and as of the Advance Date (i) except to the extent that the
representations and warranties set forth in ARTICLE V of this Agreement are
untrue as a result of circumstances that have changed subsequent to the date
hereof, which change has caused no non-compliance by the Borrower with the
covenants, conditions and agreements in this Agreement and (ii) except that the
references in Section 5.5 of this Agreement to the financial statements and the
term "Balance Sheet Date" are deemed to refer to the most recent financial
statements (inclusive of consolidated balance sheets and statements of
operations, cash flows and stockholders' equity of the Borrower and its
Subsidiaries) furnished to the Lenders pursuant to Section 7.1(a) and (b) of
this Agreement and the date of such financial statements, respectively.
(c) No Litigation; Certain Other Conditions. There shall
be no suit or proceeding (other than suits or proceedings disclosed on the
Disclosure Schedule on the date of this Agreement) pending or threatened before
any court or arbitration tribunal or by or before any governmental or regulatory
authority, commission, bureau or agency or public regulatory body that, if
determined adversely to the Borrower or any Subsidiary of the Borrower, is
reasonably likely to have a material adverse effect on the consolidated
financial condition or results of operations of the Borrower and its
Subsidiaries taken as a whole.
25
(d) No Material Adverse Change. There shall have been no
material adverse change in the consolidated financial condition or results of
operations of the Borrower and its Subsidiaries taken as a whole since the
Balance Sheet Date.
(e) Loan Documents. All Loan Documents shall be in full
force and effect.
6.2 First Advance. The obligations of the Lenders to make the first
Advance after the Closing Date are subject to the following additional
conditions precedent, each of which shall have been met or performed on or
before the Closing Date:
(a) Deliveries. The Agent shall have received, in form
and substance satisfactory to the Agent and Lenders, the following:
(i) an opinion or opinions of independent
counsel to the Borrower with respect to the Loan Documents and
the transactions contemplated thereby;
(ii) certificates as to the Borrower's legal
existence and good standing under the laws of The Commonwealth
of Massachusetts, and certificates as to the Borrower's
authority to do business as a foreign corporation in all
states in which it is qualified to do business, each dated as
of a recent date;
(iii) a certificate of the Borrower's Clerk or
Assistant Clerk as to (i) its charter documents and by- laws,
as amended, (ii) corporate votes authorizing the execution and
delivery of the Loan Documents, and (iii) incumbency of the
officers authorized to execute the Loan Documents on behalf of
the Borrower;
(iv) a Revolving Credit Note to the order of each
Lender, each duly executed by the Borrower and otherwise
appropriately completed;
(v) a certificate duly executed by the
Borrower's chief financial officer or treasurer dated the
Advance Date or Closing Date, as the case may be, to the
effect that each of the conditions set forth in the foregoing
Section 6.1 has been met as of such date; and
(vi) an executed guaranty of the Obligations in
form and substance acceptable to the Lenders (a "Guaranty")
from each Material Subsidiary.
(b) All Proceedings Satisfactory. All corporate and other
proceedings taken prior to or on the Closing Date in connection with the
transactions contemplated by this Agreement, and all documents and exhibits
related thereto, shall be reasonably satisfactory in form and substance to the
Agent and the Lenders.
(c) Additional Documents. The Borrower shall have
delivered to the Agent all additional opinions, documents and certificates that
the Agent or any Lender may reasonably require.
26
ARTICLE VII.
AFFIRMATIVE COVENANTS OF THE BORROWER
The Borrower covenants and agrees that from the date of execution of
this Agreement and until the payment in full of the principal of and interest
upon the Notes and payment and performance of all other Obligations, unless the
Required Lenders shall otherwise consent in writing:
7.1 Reporting Requirements. The Borrower shall furnish to the Lenders:
(a) As soon as available and in any event within
forty-five days after the end of each of the first three quarters of each fiscal
year of the Borrower and its Subsidiaries beginning with the quarter ended June
30, 2002, (i) an unaudited consolidated and consolidating balance sheet of the
Borrower and its Subsidiaries as of the end of such quarter and (ii) unaudited
consolidated and consolidating statements of operations, cash flows and
stockholders' equity of the Borrower and its Subsidiaries for the period
commencing at the end of the previous fiscal year and ending with the end of
such quarter, all in reasonable detail and duly certified by the chief financial
officer or treasurer of the Borrower as having been prepared in accordance with
generally accepted accounting principles consistently applied (subject to
addition of notes and ordinary year-end audit adjustments), together with a
certificate of the chief financial officer or treasurer of the Borrower stating
that no Default or Event of Default has occurred and is continuing or, if a
Default or an Event of Default has occurred and is continuing, a statement as to
the nature thereof and the action that the Borrower proposes to take with
respect thereto;
(b) As soon as available and in any event within ninety
days after the end of each fiscal year of the Borrower, the audited consolidated
balance sheet of the Borrower and its Subsidiaries as of the end of such fiscal
year and the audited consolidated statements of operations, cash flows and
stockholders' equity of the Borrower and its Subsidiaries for such fiscal year,
in each case accompanied by the unqualified opinion with respect thereto of the
Borrower's independent public accountants and a certification by such
accountants stating that they have reviewed this Agreement and whether, in
making their audit, they have become aware of any Default or Event of Default
and if so, describing its nature, along with the related unaudited consolidating
balance sheet of the Borrower and its Subsidiaries as of the end of such fiscal
year and the unaudited consolidating statements of operations, cash flows and
stockholders' equity of the Borrower and its Subsidiaries for such fiscal year;
(c) Concurrent with, and no later than the required date
for delivery of the financial information outlined in Sections 7.1(a) and (b), a
certificate signed by the chief financial officer or treasurer of the Borrower
substantially in the form of Exhibit D hereto (the "Compliance Certificate");
(d) Not later than forty-five days after the end of each
fiscal year of the Borrower, the Borrower's representative forecast for the next
fiscal year on a consolidated basis, including, at a minimum, projected
statements of profit and loss and projected cash flow, prepared in accordance
with generally accepted accounting principles consistently applied;
27
(e) Promptly upon receipt thereof, one copy of each other
report submitted to the Borrower or any Subsidiary by independent accountants in
connection with any annual, interim or special audit made by them of the books
of the Borrower or any Material Subsidiary;
(f) Promptly after the commencement thereof, notice of
all actions, suits and proceedings before any court, arbitration tribunal or
governmental regulatory authority, commission, bureau, agency or public
regulatory body that, if determined adversely to the Borrower or any Subsidiary
of the Borrower, would be reasonably likely to have a material adverse effect on
the consolidated financial condition or results of operations of the Borrower
and its Subsidiaries taken as a whole;
(g) As soon as possible, and in any event within five
days after the Borrower shall know of the occurrence of any Default or Event of
Default, the written statement of the chief financial officer or treasurer of
the Borrower setting forth details of such Default or Event of Default and
action that the Borrower proposes to take with respect thereto;
(h) As soon as possible, and in any event within five
days after the occurrence thereof, written notice as to any other event of which
the Borrower becomes aware that with the passage of time, the giving of notice
or otherwise, is reasonably likely to result in a material adverse change in the
consolidated financial condition or results of operations of the Borrower and
its Subsidiaries taken as a whole;
(i) Promptly after Borrower becomes aware thereof,
written notice of any noncompliance with ERISA that with the passage of time,
the giving of notice or otherwise, is reasonably likely to result in a liability
to the Borrower in excess of $1,000,000; and
(j) Such other information respecting the business or
properties or the condition or operations, financial or otherwise, of the
Borrower as any Lender may from time to time reasonably request.
7.2 Loan Proceeds. The Borrower shall use the proceeds of the Advances
only for the purpose of general working capital, acquisitions not prohibited
hereby and capital expenditures; provided, however, that the Borrower may use
proceeds of the Advances to repurchase its outstanding capital stock so long as
it does not make aggregate purchases with such proceeds exceeding $6,000,000.
7.3 Maintenance of Business and Properties; Insurance.
(a) The Borrower will continue to engage in business of the same
general nature as the business currently engaged in by the Borrower. The
Borrower will at all times maintain, preserve and protect all material
franchises and trade names and preserve all the Borrower's material tangible
property used or useful in the conduct of its business and keep the same in good
repair, working order and condition, ordinary wear and tear excepted, and from
time to time make all needful and proper repairs, renewals, replacements,
betterments, and improvements thereto so that the business carried on in
connection therewith may be conducted properly and advantageously at all times;
provided that nothing in this Section 7.3 shall prevent the Borrower from
discontinuing the operation and maintenance of any of its properties or any of
those of its Subsidiaries (including the voluntary liquidation and dissolution
of a Subsidiary other
28
than a Material Subsidiary) if such discontinuance is, in the judgment of the
Borrower, desirable in the conduct of its or their business and does not
materially adversely affect the business of the Borrower and its Subsidiaries on
a combined basis.
(b) The Borrower will keep all of its insurable
properties now or hereafter owned adequately insured at all times against loss
or damage by fire or other casualty to the extent customary with respect to like
properties of companies conducting similar businesses and to the extent
available at commercially reasonable rates; and will maintain public liability
and workmen's compensation insurance insuring the Borrower to the extent
customary with respect to companies conducting similar businesses and to the
extent available at commercially reasonable rates, all by financially sound and
reputable insurers. The Borrower shall furnish to the Agent from time to time
at the Agent's request copies of all such insurance policies and certificates
evidencing such insurance coverage. Notwithstanding the foregoing, the Borrower
may self-insure workmen's compensation to the extent permitted by law and may
also self-insure other risks to the extent reasonably deemed prudent by the
Borrower.
7.4 Payment of Taxes. The Borrower shall pay and discharge, or cause to
be paid and discharged, all material taxes, assessments, and governmental
charges or levies imposed upon the Borrower and its Subsidiaries or their
income or profits, or upon any other properties belonging to the Borrower prior
to the date on which penalties attach thereto, and all lawful claims that, if
unpaid, might become a lien or charge upon any material properties of the
Borrower, except for such taxes, assessments, charges, levies or claims as are
being contested by the Borrower in good faith by appropriate proceedings
promptly initiated and diligently prosecuted, for which adequate book reserves
have been established in accordance with generally accepted accounting
principles, as to which no foreclosure, distraint, sale or other similar
proceedings shall have been commenced, or, if commenced, have been effectively
stayed.
7.5 Compliance with Laws, etc. The Borrower shall comply with the
requirements of all applicable laws, rules, regulations and orders of any
governmental authority, and obtain or maintain all Licenses required under
applicable law or regulation for the operation of the Borrower's business,
where noncompliance or failure to obtain or maintain would have a material
adverse effect on the consolidated financial condition, assets, or results of
operations of the Borrower and its Subsidiaries taken as a whole; provided,
however, that such compliance or the obtaining of such Licenses may be delayed
while the applicability or validity of any such law, rule, regulation or order
or the necessity for obtaining any such License is being contested by the
Borrower in good faith by appropriate proceedings promptly initiated and
diligently prosecuted.
7.6 Books, Records and Accounts. The Borrower shall keep true and
correct books, records and accounts, in which entries will be made in
accordance with generally accepted accounting principles consistently applied,
and that shall comply with the requirements of the Foreign Corrupt Practices
Act of 1977 to the extent applicable to the Borrower. Each Lender or its
representatives shall upon reasonable notice to the Borrower be afforded,
during normal business hours, access to and the right to examine and copy any
such books, records and accounts and the right to inspect the Borrower's
premises and business operations. All financial and other information with
respect to the Borrower and/or any of its Subsidiaries now or hereafter
obtained by any Lender under this Agreement or otherwise in connection with any
of
29
the transactions contemplated hereunder shall be held in confidence and shall
not be released or made available to any other Person, except (i) to
governmental agencies (and examiners employed by same) having oversight over
the affairs of such Lender, (ii) pursuant to subpoena or similar process issued
by a court or governmental agency of competent jurisdiction, or (iii) as
otherwise directed by order of any court or governmental agency of competent
jurisdiction.
7.7 Further Assurances. The Borrower shall execute and deliver, at the
Borrower's expense, all notices and other instruments and documents and take all
actions, including, but not limited to, making all filings and recordings, that
any Lender shall reasonably request in order to assure to the Lenders all rights
given to the Lenders hereby or under any other Loan Document.
7.8 Bank Accounts. The Borrower shall maintain its principal operating
accounts with the Agent.
7.9 Guaranties. The Borrower shall cause any Subsidiary that becomes a
Material Subsidiary promptly thereafter to execute and deliver a Guaranty to
the Agent.
ARTICLE VIII.
NEGATIVE COVENANTS OF THE BORROWER
The Borrower covenants and agrees that from the date of execution of
this Agreement and until the payment in full of the principal of and interest
upon the Notes and payment and performance of all other Obligations, unless the
Required Lenders shall otherwise consent in writing, the Borrower will not, and
will not cause or permit any of its Subsidiaries to:
8.1 Sale of Assets; Mergers, Etc.
(a) Sale of Assets. Except for sales in the ordinary
course of business, sell, transfer, or otherwise dispose of, to any Person any
assets (including the securities of any Subsidiary) other than assets having an
aggregate fair market value less than five percent (5%) of Borrower's
Consolidated Tangible Net Worth.
(b) Mergers, Etc. Consolidate with or merge into any
other Person or permit any other Person to consolidate with or merge into it,
or acquire all or substantially all of the capital stock or assets of any
Person, or sell, assign, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or substantially all of its
assets to any Person, except that
(1) a Subsidiary may consolidate with or merge
into, or sell, assign, lease or otherwise dispose of any or
all of its assets to, the Borrower or another Subsidiary; and
(2) the Borrower or any of its Subsidiaries may
acquire all or substantially all of the capital stock or
assets of any Person or consolidate or merge with any Person
provided (i) such Person is engaged in a line of business
substantially similar to one or more of Borrower's existing
lines of business, (ii) the aggregate purchase price
liability incurred between the date hereof and the Revolver
Termination Date, including all contingent liabilities, when
aggregated
30
with all such acquisitions and any Investments permitted
under Section 8.6(3) during such period shall not exceed
the greater of $25,000,000 or the sum equal to 20% of
Consolidated Net Cash at such time, and if 80% or more of
the purchase price is paid in capital stock of the
Borrower, such aggregate purchase price liability shall not
exceed 30% of Consolidated Tangible Net Worth as of the end
of the most recent fiscal quarter, (iii) in the case of an
acquisition of an entity that would be deemed to be a
Material Subsidiary upon consummation of such acquisition,
based on a pro forma calculation of the ratios set forth in
Sections 8.9 - 8.11 as of the date such acquisition is
closed, assuming consolidation of the acquired business
with the Borrower for the four full fiscal quarters ended
immediately preceding such closing and pro forma debt and
debt service payments based on scheduled principal
payments, including acquisition borrowings, if any, and pro
forma interest on total debt at then prevailing borrowing
rates, Borrower is in compliance with the financial
covenants set forth in Sections 8.9 - 8.11, and (iv) all
contingent liability and contingent payment obligations
incurred by Borrower or any of its Subsidiaries in
connection with such transaction shall be reasonably
acceptable to the Agent.
8.2 Liens and Encumbrances.
(a) Create, incur, assume or permit to exist any of its
real or personal property, whether now owned or subsequently acquired, to be
subject to any Lien other than Liens described below (which may herein be
referred to as "Permitted Liens"):
(1) Liens securing the payment of taxes,
assessments or governmental charges or levies or the demands
of suppliers, mechanics, carriers, warehousers, landlords and
other like Persons, which payments are not yet due and
payable or (as to taxes) may be paid without interest or
penalty; provided, that, if such payments are due and
payable, such Liens shall be permitted hereunder only to the
extent that (A) all claims that the Liens secure are being
actively contested in good faith and by appropriate
proceedings, (B) adequate book reserves have been established
with respect thereto to the extent required by generally
accepted accounting principles, and (C) such Liens do not in
the aggregate materially interfere with the owning company's
use of property necessary or material to the conduct of the
business of the Borrower and its Subsidiaries taken as a
whole;
(2) Liens incurred or deposits made in the
ordinary course of business (A) in connection with worker's
compensation, unemployment insurance, social security and
other like laws, or (B) to secure the performance of
letters of credit, bids, tenders, sales contracts, leases,
statutory obligations, surety, appeal and performance bonds
and other similar obligations, in each case not incurred in
connection with the borrowing of money, the obtaining of
advances or the payment of the deferred purchase price of
property;
(3) Liens not otherwise described in Section
8.2(a)(1) or (2) that are incurred in the ordinary course
of business and are incidental to the conduct of its
business or ownership of its property, were not incurred in
connection with the
31
borrowing of money, the obtaining of advances or the
payment of the deferred purchase price of property and do
not in the aggregate materially detract from the value of,
or materially interfere with the owning company's use of,
property necessary or material to the conduct of the
business of the Borrower and its Subsidiaries taken as a
whole;
(4) Liens in favor of the Agent for the benefit
of the Lenders;
(5) Judgment liens or attachments that shall not
have been in existence for a period longer than 30 days
after the creation thereof, or if a stay of execution shall
have been obtained, for a period longer than 30 days after
the expiration of such stay or if such an attachment is
being actively contested in good faith and by appropriate
proceedings, for a period longer than 30 days after the
creation thereof;
(6) Liens existing as of the Closing Date and
disclosed on the Disclosure Schedule hereto;
(7) Liens provided for in equipment or Financing
Leases (including financing statements and undertakings to
file financing statements) provided that they are limited
to the equipment subject to such leases and the proceeds
thereof;
(8) Leases or subleases with third parties or
licenses and sublicenses granted to third parties not
interfering in any material respect with the business of
the Borrower or any Subsidiary of the Borrower;
(9) Any Lien on any asset of any corporation
existing at the time such corporation is merged into or
consolidated with (or acquired in accordance with Section
8.1(b) by) the Borrower or a Subsidiary of the Borrower and
not created in contemplation of such event;
(10) Any Lien existing on any asset prior to the
acquisition thereof by the Borrower or any Subsidiary of
the Borrower and not created in contemplation of such event;
(11) Liens in respect of any purchase money
obligations for tangible property used in its business,
which obligations shall not at any time exceed 5% of
Consolidated Tangible Net Worth, provided that any such
encumbrances shall not extend to property and assets of the
Borrower or any Subsidiary not financed by such a purchase
money obligation;
(12) Easements, rights of way, restrictions and
other similar charges or Liens relating to real property
and not interfering in a material way with the ordinary
conduct of its business;
(13) Liens on its property or assets created in
connection with the refinancing of Indebtedness secured by
Permitted Liens on such property, provided that the amount
of Indebtedness secured by any such Lien shall not be
32
increased as a result of such refinancing and no such Lien
shall extend to property and assets of the Borrower or any
Subsidiary not encumbered prior to any such refinancing; and
(14) Cash collateral not to exceed 497,463
Pounds Sterling delivered to Chase with respect to Borrower's
Letters of Credit issued by Chase for account party MKS
Instruments UK Limited in an aggregate amount not exceeding
497,463 Pounds Sterling.
(b) In case any property is subjected to a Lien in
violation of Section 8.2(a), the Borrower will make or cause to be made
provision whereby the Notes will be secured equally and ratably with all other
obligations secured by such property, and in any case the Notes shall have the
benefit, to the full extent that the holders may be entitled thereto under
applicable law, of an equitable Lien equally and ratably securing the Notes.
Such violation of Section 8.2(a) shall constitute an Event of Default
hereunder, whether or not any such provision is made pursuant to this Section
8.2(b).
(c) Neither the Borrower nor any Subsidiary will agree
with any third party not to cause or permit any of its real or personal
property, whether now owned or subsequently acquired, to be subject to Liens
(with or without exceptions).
(d) (i) Cause or permit or (ii) agree or consent to cause
or permit in the future (upon the happening of a contingency or otherwise), any
of its equity interests in any Subsidiary to be subject to any Lien (including
any Permitted Lien).
8.3 Sales and Leasebacks. Sell or transfer any of their property and
become, directly or indirectly, liable as the lessee under a lease of such
property (other than such transactions between the Subsidiaries and transfers
of capital equipment that will be leased pursuant to Financing Leases).
8.4 Indebtedness. Create, incur or assume any Indebtedness other than:
(1) Indebtedness to the Lenders pursuant to this
Agreement;
(2) Financing Lease Obligations, not to exceed
$10,000,000 in the aggregate at any one time outstanding;
(3) Endorsements for collection, deposit or
negotiation and warranties of products or services, in each
case incurred in the ordinary course of business;
(4) Indebtedness of the Borrower owing to
Subsidiaries that is subordinated to the payment of the
Obligations pursuant to an agreement in the form of Exhibit
E hereto in an aggregate principal amount at any time
outstanding not to exceed $50,000,000;
(5) Indebtedness of the Borrower owing to
Subsidiaries not otherwise permitted by this Section 8.4 in
an aggregate principal amount at any time outstanding not
to exceed $5,000,000;
33
(6) Indebtedness of Subsidiaries owing to the
Borrower not otherwise permitted by this Section 8.4 in an
aggregate principal amount at any time outstanding not to
exceed $15,000,000;
(7) Indebtedness of any wholly-owned Subsidiary
owing to any other wholly-owned Subsidiary;
(8) Guarantees by Material Subsidiaries of the
Obligations;
(9) Indebtedness with respect to Investments
permitted by Section 8.6(3) so long as such entities remain
Subsidiaries or Affiliates of the Borrower; and
(10) Indebtedness not included above and listed
on the Disclosure Schedule.
8.5 Dividends and Distributions. Declare or pay, directly or
indirectly, any dividend (other than a dividend payable solely in the Common
Stock of the Borrower) or make any other distribution (by reduction of capital
or otherwise), whether in cash, property, securities or a combination thereof,
with respect to any shares of its capital stock or, directly or indirectly,
except to the extent permitted by Section 7.2 hereof, redeem, purchase, retire
or otherwise acquire for value any shares of any class of its capital stock or
set aside any amount for any such purpose; provided, however, that any
Subsidiary of the Borrower may declare and pay dividends or make other
distributions to the Borrower or another Subsidiary.
8.6 Investments. Except as permitted by Section 8.1, make or maintain
any investments, made in cash or by delivery of property or assets, (a) in any
Person, whether by acquisition of capital stock, Indebtedness, or other
obligations or securities, or by loan or capital contribution, or otherwise, or
(b) in any property, whether real or personal, (items (a) and (b) being herein
called "Investments") except the following (but only with funds other than
proceeds of Advances):
(1) Investments in direct obligations of, or
guaranteed by, the United States government, its agencies
or any public instrumentality thereof and backed by the
full faith and credit of the United States government with
maturities not to exceed (or an unconditional right to
compel purchase within) three years from the date of
acquisition;
(2) Repurchase agreements collateralized by
securities of the U.S. Government and U.S.
Government-sponsored securities;
(3) Investments in or to any Subsidiary or other
Affiliate, provided Borrower remains in compliance with
Section 8.1(b);
(4) Investments and obligations issued by the
United States government, any agency thereof, any state of
the United States or any political subdivision of any such
state or any public instrumentality thereof with maturities
not to exceed (or an unconditional right to compel purchase
within) three years
34
from the date of acquisition that are rated AA-or higher by
at least one nationally recognized rating agency;
(5) Investments and obligations issued by any
company (other than a bank) with maturities not to exceed
three years from the date of acquisition with a long-term
debt rating of A or higher or a short-term debt rating of
A1 or P1 by at least one nationally recognized rating
agency;
(6) Investments in demand and time deposits
with, Eurodollar deposits with, certificates of deposit
issued by, or obligations or securities fully backed by
letters of credit issued by (x) any bank organized under
the laws of the United States, any state thereof, the
District of Columbia or Canada having combined capital and
surplus aggregating at least $500,000,000, or (y) any other
bank organized under the laws of a state that is a member
of the European Economic Community (or any political
subdivision thereof), Japan, the Cayman Islands, or British
West Indies having as of any date of determination combined
capital and surplus of not less than $500,000,000 or the
equivalent thereof (determined in accordance with generally
accepted accounting principles);
(7) Shares of money market mutual funds
registered under the Investment Company Act of 1940, as
amended;
(8) Foreign currency swaps and hedging
arrangements entered into in the ordinary course of
business to protect against currency losses, and interest
rate swaps and caps entered into in the ordinary course of
business to protect against interest rate exposure on
Indebtedness bearing interest at a variable rate;
(9) Investments in mutual funds (other than
money market mutual funds and short term bond funds with
individual maturities under three years and aggregate
ratings of A- or A3 or higher by at least one nationally
recognized rating agency) that in the aggregate shall not
exceed $5,000,000;
(10) Investments in the form of advances to
employees in the ordinary course of business for moving,
entertainment, travel and other similar expenses, but not
more than $3,000,000 in the aggregate outstanding at any
time; and
(11) Other Investments existing on the Closing
Date and listed on the Disclosure Schedule.
8.7 Transactions with Affiliates. Enter into any transaction (including
the purchase, sale or exchange of property or the rendering of any service)
with any Affiliate except upon fair and reasonable terms that are at least as
favorable to the Borrower or the Subsidiary as would be obtained in a
comparable arm's-length transaction with a non-Affiliate.
8.8 ERISA Compliance. Permit any employee pension benefit plan (as
such term is defined in Section 3 of ERISA) maintained by the Borrower or any of
its Subsidiaries or in which employees of the Borrower or any of its
Subsidiaries is entitled to participate to:
35
(a) engage in any "prohibited transaction" as such term
is defined in Section 4975 of the Internal Revenue
Code of 1986, as amended, or described in Section 406
of ERISA;
(b) incur any "accumulated funding deficiency" as such
term is defined in Section 302 of ERISA, whether or
not waived; or
(c) terminate under circumstances that could result in
the imposition of a Lien on the property of the
Borrower or any Subsidiary of the Borrower pursuant
to Section 4068 of ERISA.
8.9 Tangible Net Worth Test. Permit the Consolidated Tangible Net
Worth as of the end of each fiscal quarter of the Borrower to be less than the
sum of (i) $260,000,000, plus (ii) 80% of Consolidated Net Income (excluding
losses), plus (iii) the net proceeds of any equity securities sold by the
Borrower after June 30, 2002, for each consecutive fiscal quarter of the
Borrower beginning with the quarter ended June 30, 2002, on a cumulative basis.
8.10 Total Liabilities-to-Tangible Net Worth Ratio. Permit the
ratio ("Total Liabilities-to-Tangible Net Worth Ratio") of the Consolidated
Total Liabilities as of the end of each fiscal quarter of the Borrower
beginning with the fiscal quarter ended June 30, 2002 to its Consolidated
Tangible Net Worth as of the end of each fiscal quarter of the Borrower
beginning with the fiscal quarter ended June 30, 2002 to exceed 1 to 1.
8.11 Consolidated Net Cash Test. Permit the Consolidated Net Cash
at any time to be less than $65,000,000.
8.12 Capital Expenditures. Make capital expenditures that in the
aggregate and on a consolidated basis exceed during each fiscal quarter of the
Borrower the sum of $10,000,000 plus the amount by which such expenditures
during the immediately preceding quarter, beginning with the quarter ended June
30, 2002, were less than $10,000,000.
8.13 Consolidated Operating Loss Test. Permit the Consolidated
Operating Loss as of the end of each fiscal quarter of the Borrower beginning
with the quarter ended June 30, 2002 to be greater than 10% of Consolidated
Tangible Net Worth.
8.14 Contracts Prohibiting Compliance with Agreement. Enter into
any contract or other agreement that would prohibit or in any way restrict the
ability of the Borrower to comply with any provision of this Agreement.
ARTICLE IX.
EVENTS OF DEFAULT
9.1 Default. If any one of the following events ("Events of Default")
shall occur:
(a) Any representation or warranty made by the Borrower
herein or in any other Loan Document, or in any certificate or report furnished
by the Borrower hereunder or thereunder, shall prove to have been incorrect in
any material respect when made;
36
(b) Payment of any principal or interest due under any
Note shall not be made on or before the date due;
(c) A final judgment or settlement for in excess of
$3,000,000 shall be rendered against or agreed to by the Borrower or any of its
Subsidiaries for the payment of money that, after deducting the amount of any
insurance proceeds paid or payable to or on behalf of the Borrower or its
Subsidiary in connection with such judgment or settlement, as the case may be,
is in excess of $3,000,000, and such judgment shall remain undischarged for a
period of thirty (30) days, during which period execution shall not effectively
be stayed, or such settlement shall remain unpaid for a period of thirty days
after the agreed payment date unless such delay has been agreed to by the other
party. If a dispute exists with respect to the liability of any insurance
underwriter under any insurance policy of the Borrower or its Subsidiary, no
deduction under this subsection shall be made for the insurance proceeds that
are the subject of such dispute;
(d) The Borrower or any Subsidiary (except to the extent
explicitly permitted by this Agreement), shall (1) voluntarily terminate
operations or apply for or consent to the appointment of, or the taking of
possession by, a receiver, custodian, trustee or liquidator of such Person or of
all or a substantial part of the assets of such Person, (2) admit in writing its
inability, or be generally unable, to pay its debts as the debts become due, (3)
make a general assignment for the benefit of its creditors, (4) commence a
voluntary case under the Federal Bankruptcy Code (as now or hereafter in
effect), (5) file a petition seeking to take advantage of any other law relating
to bankruptcy, insolvency, reorganization, winding-up, or composition or
adjustment of debts, (6) fail to controvert in a timely and appropriate manner,
or acquiesce in writing to, any petition filed against it in an involuntary case
under the Federal Bankruptcy Code or applicable state bankruptcy laws or (7)
take any corporate action for the purpose of effecting any of the foregoing;
(e) Without its application, approval or consent, a
proceeding shall be commenced, in any court of competent jurisdiction, seeking
in respect of the Borrower or any domestic Subsidiary: the liquidation,
reorganization, dissolution, winding-up, or composition or readjustment of
debt, the appointment of a trustee, receiver, liquidator or the like of such
Person or of all or any substantial part of the assets of such Person, or other
like relief in respect of such Person under any law relating to bankruptcy,
insolvency, reorganization, winding-up, or composition or adjustment of debts;
and, if the proceeding is being contested in good faith by such Person, the same
shall continue undismissed, or unstayed and in effect for any period of 45
consecutive days, or an order for relief against such Person shall be entered in
any case under the Bankruptcy Code or applicable state bankruptcy laws;
(f) Any foreclosure or other proceedings shall be
commenced to enforce, execute or realize upon any lien, encumbrance, attachment,
trustee process, mortgage or security interest for payment of an amount in
excess of $500,000 against the Borrower or any Subsidiary;
(g) Default shall be made in the due observance or
performance of any covenant or agreement under Article VIII;
37
(h) Default shall be made in the due observance or
performance of any covenant or agreement contained herein (and not constituting
an Event of Default under any other clause in this Article IX) or in any other
Loan Document or in any other agreement between any Lender and the Borrower
evidencing or securing borrowed monies and such default shall continue and shall
not have been remedied within thirty days after the date on which such default
occurred;
(i) There shall occur any default under any instrument or
agreement evidencing any indebtedness for money borrowed in excess of $500,000
by the Borrower or any of its Subsidiaries;
(j) There shall occur a Change in Control;
(k) There shall occur any material adverse change in the
financial condition of the Borrower;
then, and in any such event and at any time thereafter, if such Event of Default
or any other Event of Default shall have not been waived, any or all of the
following actions may be taken: (i) the Agent (A) with the consent of the
Required Lenders, may, and at the direction of the Required Lenders shall,
declare any obligation of the Lenders to make further Advances terminated,
whereupon the obligation of each Lender to make further Advances hereunder shall
terminate immediately, and (B) the Agent shall at the direction of the Required
Lenders, at their option, declare by notice to the Borrower any or all of the
Obligations to be immediately due and payable, and the same, including all
interest accrued thereon and all other obligations of the Borrower to the Agent
and the Lenders, shall forthwith become immediately due and payable without
presentment, demand, protest, notice or other formality of any kind, all of
which are hereby expressly waived, anything contained herein or in any
instrument evidencing the Obligations to the contrary notwithstanding; provided,
however, that notwithstanding the above, if there shall occur an Event of
Default under clause (d) or (e) above, then the obligation of the Lenders to
make Advances shall automatically terminate and any and all of the Obligations
shall be immediately due and payable without the necessity of any action by the
Agent or the Required Lenders or notice to the Agent or the Lenders; and (ii)
the Agent and each of the Lenders shall have all of the rights and remedies
available under each of the Loan Documents or under any applicable law.
9.2 Agent to Act. In case any one or more Events of Default shall occur
and not have been waived, the Agent may, and at the direction of the Required
Lenders shall, proceed to protect and enforce their rights or remedies either
by suit in equity or by action at law, or both, whether for the specific
performance of any covenant, agreement or other provision contained herein or
in any other Loan Document, or to enforce the payment of the Obligations or any
other legal or equitable right or remedy.
9.3 Cumulative Rights. No right or remedy herein conferred upon the
Lenders or the Agent is intended to be exclusive of any other rights or
remedies contained herein or in any other Loan Document, and every such right
or remedy shall be cumulative and shall be in addition to every other such
right or remedy contained herein and therein or now or hereafter existing at
law or in equity or by statute, or otherwise.
38
9.4 No Waiver. No course of dealing between the Borrower and any Lender
or the Agent or any failure or delay on the part of any Lender or the Agent in
exercising any rights or remedies under any Loan Document or otherwise
available to it shall operate as a waiver of any rights or remedies and no
single or partial exercise of any rights or remedies shall operate as a waiver
or preclude the exercise of any other rights or remedies hereunder or of the
same right or remedy on a future occasion.
9.5 Allocation of Proceeds. If an Event of Default has occurred and not
been waived, and the maturity of the Notes has been accelerated pursuant to
this Article IX, all payments received by the Agent hereunder, in respect of
any principal of or interest on the Obligations or any other amounts payable by
the Borrower hereunder, shall be applied by the Agent in the following order:
(a) amounts due to the Lenders pursuant to Sections 2.6
and 11.4;
(b) amounts due to the Agent pursuant to Section 10.10
and to the Arranger pursuant to Section 2.1.3;
(c) payments of interest on the Notes to be applied for
the ratable benefit of the Lenders;
(d) payments of principal of the Notes to be applied for
the ratable benefit of the Lenders;
(e) payments of all other amounts due under any of the
Loan Documents, if any, to be applied for the ratable benefit of the Lenders;
and
(f) any surplus remaining after application as provided
for herein, to the Borrower or otherwise as may be required by
applicable law.
ARTICLE X.
THE AGENT
10.1 Appointment. Each Lender hereby irrevocably designates and
appoints Fleet as the Agent for the Lenders under this Agreement, and each of
the Lenders hereby irrevocably authorizes Fleet as the Agent for such Lender,
to take such action on its behalf under the provisions of this Agreement and
the other Loan Documents and to exercise such powers as are expressly delegated
to the Agent by the terms of this Agreement and such other Loan Documents,
together with such other powers as are reasonably incidental thereto. The Agent
shall not have any duties or responsibilities, except those expressly set forth
herein, or any fiduciary relationship with any of the Lenders, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities
shall be read into this Agreement or any other Loan Document or otherwise exist
against the Agent.
10.2 Limitation on Liability. Neither the Agent nor any of its
officers, directors, employees, agents or attorneys-in-fact shall be liable to
the Lenders for any action lawfully taken or omitted to be taken by it or them
under or in connection with the Loan Documents except for its or their own
gross negligence or willful misconduct. Neither the Agent nor any of its
39
affiliates shall be responsible in any manner to any of the Lenders for any
recitals, statements, representations or warranties made by the Borrower or any
officer or representative thereof contained in any Loan Document, or in any
certificate, report, statement or other document referred to or provided for in
or received by the Agent under or in connection with any Loan Document, or for
the value, validity, effectiveness, genuineness, enforceability or sufficiency
of any Loan Document, or for any failure of the Borrower to perform its
obligations under any Loan Document, or for any recitals, statements,
representations or warranties made, or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of any collateral. The Agent shall
not be under any obligation to any of the Lenders to ascertain or to inquire as
to the observance or performance of any of the terms, covenants or conditions
of any Loan Document on the part of the Borrower or to inspect the properties,
books or records of the Borrower or its Subsidiaries.
10.3 Reliance. The 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, telefacsimile or telex
message, statement, order or other document or conversation reasonably 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 the Borrower), independent
accountants and other experts selected by the Agent. The Agent may deem and
treat the payee of any Note as the owner thereof for all purposes unless an
Assignment and Acceptance shall have been filed with and accepted by the Agent.
The Agent shall be fully justified in failing or refusing to take any action
under this Agreement unless it shall first receive advice or concurrence of the
Lenders or the Required Lenders as provided in this Agreement or it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense that may be incurred by it by reason of taking or continuing to
take any such action. The Agent shall in all cases be fully protected in
acting, or in refraining from acting, under the Loan Documents in accordance
with a request of the Required Lenders, and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders and
all present and future holders of the Notes.
10.4 Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Agent has received notice from a Lender or the Borrower
referring to this Agreement, describing such Default or Event of Default and
stating that such notice is a "notice of default". In the event that the Agent
receives such a notice, the Agent shall promptly give notice thereof to the
Lenders. The Agent shall take such action with respect to such Default or Event
of Default as shall be reasonably directed by the Required Lenders; provided
that, unless and until the Agent shall have received such directions, the Agent
may (but shall not be obligated to) take such action, or refrain from taking
such action, with respect to such Event of Default as it shall deem advisable
in the best interests of the Lenders.
10.5 No Representations. Each Lender expressly acknowledges that
neither the Agent nor any of its affiliates has made any representations or
warranties to it and that no act by the Agent hereafter taken, including any
review of the affairs of the Borrower or its Subsidiaries, shall be deemed to
constitute any representation or warranty by the Agent to any Lender. Each
Lender represents to the Agent that it has, independently and without reliance
upon the Agent or any other Lender, and based on such documents and information
as it has deemed appropriate,
40
made its own appraisal of and investigation into the financial condition,
creditworthiness, affairs, status and nature of the Borrower and made its own
decision to enter into this Agreement. Each Lender also represents that it
will, independently and without reliance upon the 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 the Loan Documents and to make such
investigation as it deems necessary to inform itself as to the status and
affairs, financial or otherwise, of the Borrower or its Subsidiaries. Except
for notices, reports and other documents expressly required to be furnished to
the Lenders by the Agent hereunder, the Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the affairs, financial condition or business of the Borrower or its
Subsidiaries which may come into the possession of the Agent or any of its
Affiliates.
10.6 Indemnification. Each of the Lenders agrees to indemnify the
Agent in its capacity as such (to the extent not reimbursed by the Borrower and
without limiting any obligations of the Borrower to do so), ratably according
to the respective principal amount of the Notes held by them (or, if no Notes
are outstanding, ratably in accordance with their respective Applicable
Commitment Percentages as then in effect) from and against any and all
liabilities, obligations, losses (excluding any losses suffered by the Agent as
a result of Borrower's failure to pay any fee owing to the Agent), damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever that may at any time (including without limitation at
any time following the payment of the Notes) be imposed on, incurred by or
asserted against the Agent in any way relating to or arising out of any Loan
Document or any other Document contemplated by or referred to therein or the
transactions contemplated thereby or any action taken or omitted by the 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 resulting from the Agent's gross negligence or willful
misconduct. The agreements in this subsection shall survive the payment of the
Obligations and the termination of this Agreement.
10.7 The Agent in its Individual Capacity. With respect to its
Advances made or renewed by it and any Note issued to it, the Agent shall have
the same rights and powers under this Agreement as any Lender and may exercise
the same as though it were not the Agent, and the terms "Lender" and "Lenders"
shall, unless the context otherwise indicates, include the Agent in its
individual capacity. The Agent and its Affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Borrower as
though the Agent were not the Agent hereunder. The Agent may apply any amount
obtained by it through exercise of a right of banker's lien, set-off,
counterclaim or otherwise to satisfaction of any obligations owed it by the
Borrower whether under this Agreement and shall have the right to determine the
order in which amounts are applied to such obligations.
10.8 Resignation. If the Agent shall resign as Agent under this
Agreement, then the Required Lenders may appoint, with the consent, so long as
there shall not have occurred and be continuing a Default or Event of Default,
of the Borrower, which consent shall not be unreasonably withheld, a successor
Agent for the Lenders, which successor Agent shall be a commercial bank
organized under the laws of the United States or any state thereof, having a
41
combined surplus and capital of not less than $500,000,000, whereupon such
successor Agent shall succeed to the rights, powers and duties of the former
Agent and the obligations of the former Agent shall be terminated and canceled,
without any other or further act or deed on the part of such former Agent or
any of the parties to this Agreement; provided, however, that the former
Agent's resignation shall not become effective until such successor Agent has
been appointed and has succeeded of record to all right, title and interest in
any collateral held by the Agent; provided, further, that if the Required
Lenders and, if applicable, the Borrower cannot agree as to a successor Agent
within ninety (90) days after such resignation, the Agent shall appoint a
successor Agent that satisfies the criteria set forth above in this Section
10.8 for a successor Agent and the parties hereto agree to execute whatever
documents are necessary to effect such action under this Agreement or any other
Document executed pursuant to this Agreement; provided, however, that in such
event all provisions of the Loan Documents, shall remain in full force and
effect. After any retiring Agent's resignation hereunder as Agent, 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 Agent under this Agreement.
10.9 Sharing of Payments, Etc. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, set-off, counterclaim or
otherwise, obtain payment with respect to its Obligations (other than pursuant
to Article VI) that results in its receiving more than its pro rata share of
the aggregate payments with respect to all of the Obligations (other than any
payment pursuant to Section 4.2 or 4.3), then (a) such Lender shall be deemed
to have simultaneously purchased from the other Lenders a share in their
Obligations so that the amount of the Obligations held by each of the Lenders
shall be pro rata and (b) such other adjustments shall be made from time to
time as shall be equitable to insure that the Lenders share such payments
ratably; provided, however, that for purposes of this Section 10.9, the term
"pro rata" shall be determined with respect to the Commitment after subtraction
of amounts, if any, by which any such Lender has not funded its share of the
outstanding Advances and Obligations. If all or any portion of any such excess
payment is thereafter recovered from the Lender that received the same, the
purchase provided in this Section 10.9 shall be rescinded to the extent of such
recovery, without interest. The Borrower expressly consents to the foregoing
arrangements and agrees that each Lender so purchasing a portion of the other
Lenders' Obligations may exercise all rights of payment (including, without
limitation, all rights of set-off, banker's lien or counterclaim) with respect
to such portion as fully as if such Lender were the direct holder of such
portion.
10.10 Fees. The Borrower agrees to pay to the Agent, for its
individual account, an annual Agent's fee as from time to time agreed to by the
Borrower and Agent in writing.
ARTICLE XI.
MISCELLANEOUS
11.1 Assignments and Participations. (a) At any time after the
Closing Date each Lender may, with the prior consent of the Borrower (so long
as no Event of Default has occurred and is continuing) and the Agent, which
consents shall not be unreasonably withheld, assign to one or more banks or
financial institutions all or a portion of its rights and obligations under the
Loan Documents (including, without limitation, all or a portion of any Note
payable to its order); provided, that (i) each such assignment shall be of a
constant and not a varying percentage of all
42
of the assigning Lender's rights and obligations hereunder, (ii) for each
assignment involving the issuance and transfer of a Note, the assigning Lender
shall execute an Assignment and Acceptance and the Borrower hereby agrees to
execute a replacement Note to give effect to the assignment, (iii) the minimum
aggregate amount of a Commitment that shall be assigned is $1,000,000, (iv)
such assignee shall have an office located in the United States, (v) the
assigning Lender shall pay the Agent a transaction fee of $2500, and (vi) no
consent of the Borrower or the Agent shall be required in connection with any
assignment by a Lender to another Lender or to an Affiliate of any Lender. Upon
such execution, delivery, approval and acceptance, from and after the effective
date specified in each Assignment and Acceptance, (x) the assignee thereunder
shall be a party hereto and, to the extent that rights and obligations
hereunder or under any such Note have been assigned or negotiated to it
pursuant to such Assignment and Acceptance, have the rights and obligations of
a Lender hereunder and a holder of such Note and (y) the assignor thereunder
shall, to the extent that rights and obligations hereunder or under such Note
have been assigned or negotiated by it pursuant to such Assignment and
Acceptance, relinquish its rights and be released from its obligations under
this Agreement.
(b) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) the assignment made
under such Assignment and Acceptance is made under such Assignment and
Acceptance without recourse; (ii) such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to the financial
condition of the Borrower or its Subsidiaries or the performance or observance
by the Borrower of any of its obligations under any Loan Document or any other
instrument or Document furnished pursuant hereto; (iii) such assignee confirms
that it has received a copy of this Agreement, together with copies of the
financial statements delivered pursuant to Section 5.5 or Section 7.1, as the
case may be, and such other Loan Documents and other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Agent, such assigning Lender or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under any Loan Document; (v) such assignee appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under the Loan Documents as are delegated to the Agent by the terms
hereof and thereof, together with such powers as are reasonably incidental
thereto; and (vi) such assignee agrees that it will perform in accordance with
their terms all of the obligations that by the terms of the Loan Documents are
required to be performed by it as a Lender and a holder of a Note.
(c) The Agent shall maintain at its address referred to herein a
copy of each Assignment and Acceptance delivered to and accepted by it.
(d) Upon its receipt of an Assignment and Acceptance executed by
an assigning Lender, the Agent shall give prompt notice thereof to Borrower.
(e) Nothing herein shall prohibit any Lender from pledging or
assigning, without notice to or consent of the Borrower, any Note to any Federal
Reserve Bank in accordance with applicable law.
43
(f) Each Lender may sell participations at its expense to one or
more banks or other entities as to all or a portion of its rights and
obligations under this Agreement; provided, that (i) such Lender's obligations
under this Agreement shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iii) such Lender shall remain the holder of any Note issued to it
for the purpose of this Agreement, (iv) the Borrower, the Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement and
with regard to any and all payments to be made under this Agreement and (v) the
sale of any such participations that require Borrower to file a registration
statement with the Securities and Exchange Commission or under the securities
regulations or laws of any state shall not be permitted.
(g) The Borrower may not assign any rights, powers, duties or
obligations under this Agreement or the other Loan Documents without the prior
written consent of all the Lenders.
11.2 Survival of Representations, Etc. All representations,
warranties and covenants made herein or in any Loan Document shall survive the
making of any Advance hereunder and the delivery of the Notes and the
consummation of all other transactions contemplated hereby or thereby.
11.3 Right of Setoff. 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 and during the unremedied continuation of an
Event of Default, the Agent and each Lender is hereby authorized at any time or
from time to time, without presentment, demand, protest or other notice of any
kind to the Borrower or to any other Person, any such notice 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 the
Agent or any Lender to or for the credit or the account of the Borrower against
and on account of the Obligations, and all other claims of any nature or
description arising out of or connected with this Agreement or any other Loan
Document, irrespective of whether or not such Agent or Lender shall have made
any demand hereunder and although said Obligations, liabilities or claims, or
any of them, shall be contingent or unmatured.
11.4 Indemnity; Costs, Expenses and Taxes. The Borrower hereby
agrees to indemnify the Lenders and their legal representatives, successors,
assigns and agents against, and agrees to protect, save and keep harmless each
of them from and to pay upon demand, any and all liabilities, obligations, taxes
(including any and all stamp and other taxes payable or determined to be payable
in connection with the execution and delivery of any Loan Documents), liens,
charges, losses, damages, penalties, claims, actions, suits, costs, indemnities,
expenses and disbursements (including, without limitation, reasonable legal
fees, costs and expenses, including without limitation reasonable costs of
attending and preparing for depositions and other court proceedings), of
whatsoever kind and nature, imposed upon, incurred by or asserted against such
indemnified party in any way relating to or arising out of the execution,
delivery, enforcement, performance and administration of this Agreement or any
other Loan Documents (all of the foregoing, collectively, "Costs") except to the
extent arising by reason of any Lender's gross negligence, misconduct or breach
hereof. Without limiting the foregoing, the Borrower agrees to pay on demand (a)
all out-of-pocket costs and expenses of
44
the Agent in connection with the preparation, execution and delivery of this
Agreement and any other Loan Documents, including without limitation the
reasonable fees and out-of-pocket expenses of ▇▇▇▇▇ ▇▇▇▇ LLP, special counsel
for the Agent, with respect thereto, as well as (b) the reasonable fees and all
out-of-pocket expenses of legal counsel, independent public accountants and
other outside experts retained by the Lenders in connection with any request by
the Borrower for consents, waivers or other action or forbearance by the Lenders
hereunder, for the modification or amendment hereof, or other like matters
relating to the administration of this Agreement; and (c) all reasonable costs
and expenses, if any, of the Lenders incurred after the occurrence of any Event
of Default hereunder in connection with the enforcement of any of the Loan
Documents or the protection of any of the Lenders' rights thereunder, including,
without limitation, any internal costs, including personnel costs of the Lenders
incurred in connection with such administration and enforcement or protection.
11.5 Notices.
(a) Unless telephonic notice is specifically permitted
pursuant to the terms of this Agreement, any notice or other communication
hereunder to any party hereto shall be by telegram, telecopier, telex, delivery
in hand or by courier, or registered or certified mail (return receipt
requested) and shall be deemed to have been given or made when telegraphed,
telexed, telecopied (and confirmed received), delivered in hand or by courier,
or three days after being deposited in the mails, postage prepaid, registered or
certified, addressed to the party as follows (or at any other address that such
party may hereafter specify to the other parties in writing):
(a) If to the Agent:
Fleet National Bank
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇. Head, Jr., Director
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇▇ ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to the Borrower:
MKS Instruments, Inc.
Six ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, CFO
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
45
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Hill & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
(c) if to the Lenders:
At the addresses set forth on the signature
pages hereof and on the signature page of each
Assignment and Acceptance.
11.6 MASSACHUSETTS LAW. THIS AGREEMENT AND EACH OF THE LOAN
DOCUMENTS SHALL BE DEEMED A CONTRACT MADE UNDER THE LAW OF THE COMMONWEALTH OF
MASSACHUSETTS AND SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, THE INTERNAL LAWS OF SAID STATE (WITHOUT REGARD TO ITS PRINCIPLES OF
CONFLICT OF LAWS).
11.7 Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original and all of
which when taken together shall constitute one and the same instrument.
11.8 JURISDICTION, SERVICE OF PROCESS.
(a) ANY SUIT, ACTION OR PROCEEDING AGAINST THE
BORROWER WITH RESPECT TO ANY OF THE LOAN DOCUMENTS OR ANY JUDGMENT ENTERED BY
ANY COURT IN RESPECT OF ANY THEREOF SHALL BE BROUGHT IN THE COURTS OF THE
COMMONWEALTH OF MASSACHUSETTS LOCATED IN SUFFOLK COUNTY OR IN THE UNITED STATES
DISTRICT COURT FOR THE EASTERN DISTRICT OF MASSACHUSETTS, AS THE LENDERS (IN
THEIR SOLE DISCRETION) MAY ELECT, AND THE BORROWER HEREBY ACCEPTS THE EXCLUSIVE
JURISDICTION OF SUCH COURTS FOR THE PURPOSE OF ANY SUIT, ACTION OR PROCEEDING
AND AGREES NOT TO ASSERT ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF SUCH COURTS.
(b) IN ADDITION, THE BORROWER HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS OR ANY JUDGMENT ENTERED BY ANY
COURT IN RESPECT THEREOF BROUGHT IN SUFFOLK COUNTY IN THE COMMONWEALTH OF
MASSACHUSETTS, AND HEREBY FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUIT,
ACTION OR
46
PROCEEDING BROUGHT IN SUFFOLK COUNTY IN THE COMMONWEALTH OF MASSACHUSETTS HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM.
11.9 Limit on Interest. It is the intention of the Lenders and the
Borrower to comply strictly with all applicable usury laws; and, accordingly, in
no event and upon no contingency shall the Lenders ever be entitled to receive,
collect, or apply as interest under any Note any interest, fees, charges or
other payments equivalent to interest, in excess of the maximum rate that the
Lenders may lawfully charge under applicable statutes and laws from time to time
in effect; and, in the event that the Lenders ever receive, collect or apply as
interest on the Notes, any such excess, such amount that, but for this
provision, would be excessive interest shall be applied to the reduction of the
principal amount of the indebtedness evidenced by the Notes; and, if the
principal amount of indebtedness evidenced by the Notes, and all lawful interest
thereon, is paid in full, any remaining excess shall forthwith be paid to the
Borrower, or other party lawfully entitled thereto. In determining whether or
not the interest paid or payable, under any specific contingency exceeds the
highest contract rate permitted by applicable law from time to time in effect,
the Borrower and the Lenders shall, to the maximum extent permitted under
applicable law, characterize any non-principal payment as a reasonable loan
charge, rather than as interest. Any provision of any Note, or of any other
agreement between the Lenders and the Borrower, that operates to bind, obligate,
or compel the Borrower to pay interest in excess of such maximum lawful contract
rate shall be construed to require the payment of the maximum rate only. The
provisions of this Section 11.9 shall be given precedence over any other
provisions contained in the Notes or in any other agreement between the Lenders
and the Borrower that is in conflict with the provisions of this Section 11.9.
11.10 Amendments. No amendment, modification or waiver of any
provision of any Loan Document and no consent by the Lenders to any departure
therefrom by the Borrower shall be effective unless such amendment, modification
or waiver shall be in writing and signed by the Agent, shall have been approved
by the Required Lenders through their written consent, and the same shall then
be effective only for the period and on the conditions and for the specific
instances and purposes specified in such writing; provided, however, that, no
such amendment, modification or waiver
(i) that changes, extends or waives any provision of Section
4.1.4, Section 10.9 or this Section 11.10, the amount of or the due
date of any scheduled principal installment of or the rate of interest
payable on or fees payable with respect to any Obligation, that changes
the definition of Required Lenders, that permits an assignment by the
Borrower of its Obligations under any Loan Document, that reduces the
required consent of the Lenders provided hereunder, that increases,
decreases (other than pursuant to the express terms hereof) or extends
(other than pursuant to the express terms hereof) the Commitment of any
Lender or the Total Commitment or that waives any condition to the
making of any Advance, shall be effective unless in writing and signed
by each of the Lenders; or
(ii) that affects the rights, privileges, immunities or
indemnities of the Agent shall be effective unless in writing and
signed by the Agent.
47
Notwithstanding any provision of the other Loan Documents to the contrary, as
between the Agent and the Lenders, execution by the Agent shall not be deemed
conclusive evidence that the Agent has obtained the written consent of the
Required Lenders. No notice to or demand on the Borrower in any case shall
entitle the Borrower to any other or further notice or demand in similar or
other circumstances, except as otherwise expressly provided herein. No delay or
omission on any Lender's or the Agent's part in exercising any right, remedy or
option shall operate as a waiver of such or any other right, remedy or option or
of any Default or Event of Default.
11.11 Headings. The headings of this Agreement are for convenience
only and are not to affect the construction of or to be taken into account in
interpreting the substance of this Agreement.
11.12 WAIVER OF NOTICE, ETC. THE BORROWER WAIVES DEMAND, NOTICE,
PROTEST, NOTICE OF ACCEPTANCE OF THIS AGREEMENT, NOTICE OF LOANS MADE, CREDIT
EXTENDED, COLLATERAL RECEIVED OR DELIVERED OR OTHER ACTION TAKEN IN RELIANCE
HEREON AND ALL OTHER DEMANDS AND NOTICE OF ANY DESCRIPTION, EXCEPT AS REQUIRED
HEREBY. WITH RESPECT BOTH TO THE OBLIGATIONS AND COLLATERAL, THE BORROWER
ASSENTS TO ANY EXTENSION OR POSTPONEMENT OF THE TIME OF PAYMENT OR ANY OTHER
INDULGENCE, TO ANY SUBSTITUTION, EXCHANGE OR RELEASE OF COLLATERAL, TO THE
ADDITION OR RELEASE OF ANY PARTY OR PERSONS PRIMARILY OR SECONDARILY LIABLE, TO
THE ACCEPTANCE OF PRETRIAL PAYMENT THEREON AND THE SETTLEMENT, COMPROMISING OR
ADJUSTING OF ANY THEREOF, ALL IN SUCH MANNER AND AT SUCH TIME OR TIMES AS THE
LENDERS MAY DEEM ADVISABLE. THE BORROWER AGREES THAT NO ACTIONS TAKEN BY ANY
PERSON EXCEPT THE LENDERS SHALL IMPAIR OR OTHERWISE AFFECT ITS OBLIGATIONS
HEREUNDER UNTIL ALL OBLIGATIONS OF THE BORROWER HEREUNDER ARE SATISFIED IN FULL.
11.13 Severability. In the event that any one or more of the
provisions contained in this Agreement shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement, but
this Agreement shall be construed as if such invalid, illegal or unenforceable
provision had never been contained herein.
11.14 Entire Agreement. This Agreement and the other Loan Documents
constitute the full and entire understanding and agreement between the parties
with regard to the subject matter hereof and thereof and shall supersede all
prior agreements and understandings, whether written or oral, between the
parties with respect to the subject matter hereof and thereof.
11.15 Compliance with Covenants. All computations determining
compliance with Article VIII shall utilize accounting principles in conformity
with those used in the preparation of the financial statements referred to in
Section 5.5. If any subsequent financial reports of the Borrower shall be
prepared in accordance with accounting principles different from those used in
the preparation of the financial statements referred to in Section 5.5, the
Borrower shall inform
48
the Agent of the changes in accounting principles and shall provide the Agent
with such reports, such supplemental reconciling financial information as may be
required to ascertain compliance by the Borrower with the covenants contained in
this Agreement.
11.16 Termination. This Agreement may be terminated by the Borrower
at any time upon written notice of such termination to the Agent; provided,
however, that, unless and until all loans made by the Lenders hereunder and all
other Obligations hereunder of the Borrower to any Lender existing (whether or
not due) as of the time of the receipt of such notice by the Agent shall have
been paid in full, such termination shall in no way affect the rights and powers
granted to the Lenders in connection with this Agreement, and until such payment
in full all rights and powers hereby granted to the Lenders hereunder shall be
and remain in full force and effect.
11.17 WAIVER OF TRIAL BY JURY. THE BORROWER WAIVES ANY AND ALL
RIGHTS THAT IT MAY HAVE TO A TRIAL BY JURY ON ANY CLAIM OR ACTION, OF ANY NATURE
WHATSOEVER, RELATING TO OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS.
49
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as an agreement under seal as of the date first above written.
Witness: MKS INSTRUMENTS, INC.
▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------- ---------------------
Title: Vice President and Chief_Financial Officer
FLEET NATIONAL BANK
By: /s/ ▇▇▇▇▇▇ ▇. Head Jr.
----------------------
Title: Director
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
JPMORGAN CHASE BANK
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
---------------
Title: Vice President
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
50
EXHIBIT A
Applicable Commitment
Lender Commitment Percentage
Fleet National Bank $24,000,000 60%
▇▇ ▇▇▇▇▇▇ Chase Bank $16,000,000 40%
----------- -----
$40,000,000 100%
51
REVOLVING CREDIT NOTE
$24,000,000 Boston, Massachusetts
July 31, 2002
FOR VALUE RECEIVED, MKS INSTRUMENTS, INC., a Massachusetts corporation
having its principal place of business located in Andover, Massachusetts (the
"Borrower"), hereby promises to pay to the order of FLEET NATIONAL BANK (the
"Lender"), in its individual capacity, at the office of FLEET NATIONAL BANK, as
agent for the Lender (the "Agent"), located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇ (or at such other place or places as the Agent may designate in
writing) at the times set forth in the First Amended and Restated Credit
Agreement dated as of July 31, 2002, as it may be amended, among the Borrower,
the financial institutions party thereto (collectively, the "Lenders") and the
Agent (the "Agreement" -- all capitalized terms not otherwise defined herein
shall have the respective meanings set forth in the Agreement), in lawful money
of the United States of America, in immediately available funds, the principal
amount of TWENTY-FOUR MILLION DOLLARS ($24,000,000) or, if less than such
principal amount, the aggregate unpaid principal amount of all Advances made by
the Lender to the Borrower pursuant to the Agreement, on the Revolver
Termination Date or such earlier date as may be required pursuant to the terms
of the Agreement, and to pay interest from the date hereof on the unpaid
principal amount hereof, in like money, at said office, on the dates and at the
rates provided in the Agreement. All or any portion of the principal amount of
Advances may be prepaid as provided in the Agreement.
If payment of all sums due hereunder is accelerated under the terms of
the Agreement or under the terms of the other Loan Documents executed in
connection with the Agreement, the then remaining principal amount and accrued
but unpaid interest shall bear interest, which shall be payable on demand, at
the rate per annum set forth in Section 2.4.2 of the Agreement. Further, in the
event of such acceleration, this Revolving Credit Note shall become immediately
due and payable, without presentation, demand, protest or notice of any kind,
all of which are hereby waived by the Borrower.
In the event this Revolving Credit Note is not paid when due at any
stated or accelerated maturity, the Borrower agrees to pay, in addition to the
principal and interest, all costs of collection, including reasonable attorneys'
fees, and interest thereon at the rates set forth above.
Interest hereunder shall be computed as provided in the Agreement.
This Revolving Credit Note is one of the Revolving Credit Notes
referred to in the Agreement and is issued pursuant to and entitled to the
benefits of the Agreement to which reference is hereby made for a more complete
statement of the terms and conditions upon which the Advances evidenced hereby
were or are made and are to be repaid. This Revolving Credit Note is subject to
certain restrictions on transfer or assignment as provided in the Agreement.
This Revolving Credit Note is issued in replacement of the Revolving Credit Note
dated July 31, 2001 (the "2001 Note") issued to the Lender in the principal
amount of $24,000,000 in connection with the Credit Agreement dated as of July
31, 2001, and the Borrower remains liable for any interest or fees under the
2001 Note unpaid as of the date hereof.
No delay or omission on the part of the Lender in exercising any right
hereunder shall operate as a waiver of such right or of any other right of the
Lender, nor shall any delay, omission or waiver on any one occasion be deemed a
bar to or waiver of the same or any other right on any future occasion. Every
maker, endorser and guarantor of this Revolving Credit Note or the obligations
represented hereby waives presentment, demand, notice, protest and all other
demands and notices in connection with the delivery, acceptance, performance,
default or enforcement of this Revolving Credit Note, assents to any extension
or postponement of the time of payment or any other indulgence, to any
substitution, exchange or release of collateral and to the addition or release
of any other party or person primarily or secondarily liable.
IN WITNESS WHEREOF, the Borrower has caused this Revolving Credit Note
to be made, executed and delivered by its duly authorized representative under
seal as of the date and year first above written.
MKS INSTRUMENTS, INC.
WITNESS:
▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President and Chief Financial Officer
-2-
REVOLVING CREDIT NOTE
$16,000,000 Boston, Massachusetts
July 31, 2002
FOR VALUE RECEIVED, MKS INSTRUMENTS, INC., a Massachusetts corporation
having its principal place of business located in Andover, Massachusetts (the
"Borrower"), hereby promises to pay to the order of JPMORGAN CHASE BANK (the
"Lender"), in its individual capacity, at the office of FLEET NATIONAL BANK, as
agent for the Lender (the "Agent"), located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇ (or at such other place or places as the Agent may designate in
writing) at the times set forth in the First Amended and Restated Credit
Agreement dated as of July 31, 2002, as it may be amended, among the Borrower,
the financial institutions party thereto (collectively, the "Lenders") and the
Agent (the "Agreement" -- all capitalized terms not otherwise defined herein
shall have the respective meanings set forth in the Agreement), in lawful money
of the United States of America, in immediately available funds, the principal
amount of SIXTEEN MILLION DOLLARS ($16,000,000) or, if less than such principal
amount, the aggregate unpaid principal amount of all Advances made by the Lender
to the Borrower pursuant to the Agreement, on the Revolver Termination Date or
such earlier date as may be required pursuant to the terms of the Agreement, and
to pay interest from the date hereof on the unpaid principal amount hereof, in
like money, at said office, on the dates and at the rates provided in the
Agreement. All or any portion of the principal amount of Advances may be prepaid
as provided in the Agreement.
If payment of all sums due hereunder is accelerated under the terms of
the Agreement or under the terms of the other Loan Documents executed in
connection with the Agreement, the then remaining principal amount and accrued
but unpaid interest shall bear interest, which shall be payable on demand, at
the rate per annum set forth in Section 2.4.2 of the Agreement. Further, in the
event of such acceleration, this Revolving Credit Note shall become immediately
due and payable, without presentation, demand, protest or notice of any kind,
all of which are hereby waived by the Borrower.
In the event this Revolving Credit Note is not paid when due at any
stated or accelerated maturity, the Borrower agrees to pay, in addition to the
principal and interest, all costs of collection, including reasonable attorneys'
fees, and interest thereon at the rates set forth above.
Interest hereunder shall be computed as provided in the Agreement.
This Revolving Credit Note is one of the Revolving Credit Notes
referred to in the Agreement and is issued pursuant to and entitled to the
benefits of the Agreement to which reference is hereby made for a more complete
statement of the terms and conditions upon which the Advances evidenced hereby
were or are made and are to be repaid. This Revolving Credit Note is subject to
certain restrictions on transfer or assignment as provided in the Agreement.
This Revolving Credit Note is issued in replacement of the Revolving Credit Note
dated July 31, 2001 (the "2001 Note") issued to The Chase Manhattan Bank in the
principal amount of $16,000,000 in connection with the Credit Agreement dated as
of July 31, 2001, and the Borrower remains liable for any interest or fees under
the 2001 Note unpaid as of the date hereof.
No delay or omission on the part of the Lender in exercising any right
hereunder shall operate as a waiver of such right or of any other right of the
Lender, nor shall any delay, omission or waiver on any one occasion be deemed a
bar to or waiver of the same or any other right on any future occasion. Every
maker, endorser and guarantor of this Revolving Credit Note or the obligations
represented hereby waives presentment, demand, notice, protest and all other
demands and notices in connection with the delivery, acceptance, performance,
default or enforcement of this Revolving Credit Note, assents to any extension
or postponement of the time of payment or any other indulgence, to any
substitution, exchange or release of collateral and to the addition or release
of any other party or person primarily or secondarily liable.
IN WITNESS WHEREOF, the Borrower has caused this Revolving Credit Note
to be made, executed and delivered by its duly authorized representative under
seal as of the date and year first above written.
MKS INSTRUMENTS, INC.
WITNESS:
▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President and Chief Financial Officer
-2-
