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Exhibit 10.28
FIRST AMENDED AND RESTATED
LOAN AGREEMENT
by and among
MKS INSTRUMENTS, INC.,
as Borrower,
BANKBOSTON, N.A.,
as Agent and as Lender,
and
THE CHASE MANHATTAN BANK,
as Lender
Dated as of January 1, 2000
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
Page
1.1. Definitions ................................................................ 1
1.2. Accounting Terms ........................................................... 7
1.3. Other Definitional Provisions .............................................. 7
ARTICLE II
REVOLVING CREDIT FACILITY
2.1. Revolving Credit ........................................................... 7
2.2. Advances ................................................................... 8
2.3. Revolving Loan Account ..................................................... 8
2.4. Interest ................................................................... 9
2.5. Interest Periods ........................................................... 10
2.6. Unused Commitment Fee ...................................................... 10
2.7. Deficiency Advances ........................................................ 11
ARTICLE III
ADDITIONAL TERMS
3.1. Payments ................................................................... 11
3.2. Capital Adequacy ........................................................... 12
3.3. Special Provisions Governing LIBOR Loans ................................... 13
3.4. Taxes ...................................................................... 14
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE BORROWER
4.1. Organization, Existence and Power .......................................... 15
4.2. Authorization of Loan Documents; Binding Effect ............................ 15
4.3. Authority .................................................................. 15
4.4. Capital Structure .......................................................... 16
4.5. Financial Condition ........................................................ 16
4.6. Pending Litigation ......................................................... l7
4.7. Certain Agreements; Material Contracts ..................................... 17
4.8. Authorization, Etc. ........................................................ 17
4.9. No Violation ............................................................... 17
4.10. Payment of Taxes............................................................ 18
4.11. Transactions With Affiliates, Officers, Directors and 1% Shareholders ...... 18
4.12. ERISA ...................................................................... 18
4.13. Ownership of Properties; Liens ............................................. 18
4.14. Employment Matters ......................................................... 19
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4.15. Insurance ........................................................ 19
4.16. Indebtedness ..................................................... 19
4.17. Securities Law Compliance ........................................ 19
4.18. Accuracy of Information .......................................... 19
ARTICLE V
CONDITIONS TO ADVANCES
5.1. Each Advance ...................................................... 19
5.2. First Advance ..................................................... 20
ARTICLE VI
AFFIRMATIVE COVENANTS OF THE BORROWER
6.1. Reporting Requirements ............................................ 21
6.2. Loan Proceeds ..................................................... 22
6.3. Maintenance of Business and Properties; Insurance ................. 23
6.4. Payment of Taxes .................................................. 23
6.5. Compliance with Laws, etc. ........................................ 23
6.6. Books, Records and Accounts ....................................... 24
6.7. Further Assurances ................................................ 24
6.8. Bank Accounts ..................................................... 24
ARTICLE VII
NEGATIVE COVENANTS OF THE BORROWER
7.1. Sale of Assets; Mergers, Etc. ..................................... 24
7.2. Liens and Encumbrances ............................................ 25
7.3. Sales and Leasebacks .............................................. 27
7.4. Investments ....................................................... 27
7.5. Transactions with Affiliates ...................................... 28
7.6. ERISA Compliance .................................................. 29
7.7. Financial Covenants ............................................... 29
7.8. Contracts Prohibiting Compliance with Agreement ................... 29
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Default ........................................................... 29
8.2. Agent to Act ...................................................... 31
8.3. Cumulative Rights ................................................. 32
8.4. No Waiver ......................................................... 32
8.5. Allocation of Proceeds ............................................ 32
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ARTICLE IX
THE AGENT
9.1. Appointment ........................................................ 32
9.2. Limitation on Liability ............................................ 33
9.3. Reliance ........................................................... 33
9.4. Notice of Default .................................................. 33
9.5. No Representations ................................................. 34
9.6. Indemnification .................................................... 34
9.7. The Agent in its Individual Capacity ............................... 34
9.8. Resignation ........................................................ 35
9.9. Sharing of Payments, Etc. .......................................... 35
9.10. Fees ............................................................... 36
ARTICLE X
MISCELLANEOUS
10.1. Assignments and Participations .................................... 36
10.2. Survival of Representations, Etc. ................................. 37
10.3. Right of Setoff ................................................... 37
10.4. Indemnity; Costs, Expenses and Taxes .............................. 38
10.5. Notices ........................................................... 38
10.6. MASSACHUSETTS LAW ................................................. 39
10.7. Counterparts ...................................................... 40
10.8. JURISDICTION, SERVICE OF PROCESS .................................. 40
10.9. Limit on Interest ................................................. 40
10.10. Amendments ........................................................ 41
10.11. Headings .......................................................... 41
10.12. WAIVER OF NOTICE, ETC. ............................................ 41
10.13. Severability ...................................................... 42
10.14. Entire Agreement .................................................. 42
10.15. Compliance with Covenants ......................................... 42
10.16. Termination ....................................................... 42
10.17. WAIVER OF TRIAL BY JURY ........................................... 42
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FIRST AMENDED AND RESTATED
LOAN AGREEMENT
This First Amended and Restated Loan Agreement (the "Agreement") is entered
into as of the 1st day of January, 2000, by and among BankBoston, N.A. (f/k/a
The First National Bank of Boston; "BankBoston"), The Chase Manhattan Bank
(f/k/a Chemical Bank; "Chase"; hereinafter BankBoston and Chase may be referred
to individually as a "Lender" or collectively as the "Lenders"), BankBoston in
its capacity as agent for the Lenders (in such capacity, together with any
successor agent appointed in accordance with the terms of Section 9.8, the
"Agent"), and MKS Instruments, Inc., a Massachusetts corporation ("Borrower").
PREMISES:
WHEREAS, the Borrower and the Lenders entered into a Loan Agreement as of
February 23, 1996, which was amended on October 18, 1996, February 4, 1997,
February 2, 1998, February 3, 1998 and January 28, 1999 (as amended, the "Loan
Agreement"); and
WHEREAS, the Borrower has requested that the Lenders agree to certain
changes to the Loan Agreement and the Lenders are willing to make such changes
on the terms and conditions hereinafter set forth;
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 Loan
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:
"Adjusted LIBOR Rate" shall have the meaning set forth in Section
2.4.1.
"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
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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.
"Applicable Commitment Percentage" shall mean, with respect to each
Lender at any time, a fraction, the numerator of which shall be such Lender's
Revolving Credit Commitment and the denominator of which shall be the Total
Revolving Credit 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 10.1.
"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 10.1.
"Base Rate" shall mean the higher of (a) the annual rate of interest
announced from time to time by BankBoston at BankBoston'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 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 BankBoston from
three funds brokers of recognized standing selected BankBoston.
"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.
"Cash Flow Ratio" shall have the meaning set forth in Section 7.7(c).
"Closing Date" shall mean the date of this Agreement.
"Compliance Certificate" shall have the meaning set forth in Section 6.
l(c).
"Consolidated Debt Service" shall mean for any period the sum (without
duplication) of Interest Expense, the interest portion of Financing Lease
Obligations and required principal payments on long-term debt of the Borrower
and its Subsidiaries, determined on a consolidated basis.
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"Consolidated Indebtedness" shall mean the Indebtedness of the Borrower
and its Subsidiaries, determined on a consolidated basis.
"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 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.
"Consolidated Operating Cash Flow" 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 unless such net income
shall have actually been received by the Borrower or Subsidiary, as the case may
be, in the form of cash distributions) of the Borrower and its Subsidiaries
before deducting Interest Expense and taxes and after restoring thereto
depreciation of real and personal property and leasehold improvements and
amortization and after deducting cash taxes paid, and capital expenditures
incurred, provided that capital expenditures shall not include real estate
purchases funded by debt.
"Consolidated Tangible Net Worth" shall mean, at any time, the
stockholders' equity of the Borrower and its Subsidiaries determined in
accordance with generally accepted accounting principles 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.
"Costs" shall have the meaning set forth in Section 10.4.
"Debt-to-Net Worth Ratio" shall have the meaning set forth in Section
7.7(b).
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"Default" shall mean any event that, with the lapse of time, the giving
of notice, or both, would become an Event of Default hereunder.
"Event of Default" shall have the meaning set forth in Section 8.1
hereof.
"Existing Loan Agreements" shall mean the Loan Agreements between the
Borrower and BankBoston dated November 1, 1993 and October 31, 1995,
respectively, as amended.
"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.
"Hazardous Substances" shall mean any hazardous waste, as defined by 42
U.S.C. Section 6903(5), any hazardous substances, as defined by 42 U.S.C.
Section 9601(14), any pollutant or contaminant, as defined by 42 U.S.C. Section
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 such
Person that in accordance with generally accepted accounting principles would be
reflected on the balance sheet of such Person as a liability, (b) 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, (c)
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, and (d) Financing Lease Obligations of such Person.
"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.
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"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.
"Investments" shall have the meaning set forth in Section 7.4.
"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.
"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 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 4.8.
"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 in favor of the Lenders in
connection with the transactions contemplated hereby.
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"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 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 7.2.
"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.
"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. 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 Revolving Credit Commitment.
"Revolver Termination Date" shall mean December 31, 2000 or any
subsequent anniversary thereof if the Total Revolving Credit Commitment shall
have been renewed by the Lenders.
"Revolving Credit 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 Revolving Credit Commitment.
"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
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account of Indebtedness evidenced by the Revolving Credit Notes; and other
appropriate debits and credits.
"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.
"Sub S Dividends" shall mean one or more distributions by the Borrower
to its shareholders who were shareholders prior to the IPO in an aggregate
amount equal to the Borrower's "accumulated adjustments account", as defined in
Section 1368(a)(1) of the Internal Revenue Code of 1986, as of the date of the
IPO.
"Total Revolving Credit Commitment" shall mean a principal amount equal
to $30,000,000.
1.2. Accounting Terms. Accounting terms not specifically defined in this
Agreement shall have the meanings given to them under generally accepted
accounting principles.
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. 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 Revolving Credit 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
Revolving Credit Outstandings shall not exceed the Total Revolving Credit
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
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no LIBOR Loan having an Interest Period of 1 month shall be made at any time in
a principal amount of less than $1,000,000.
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.
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.
2.3. 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 Revolving Credit Commitment. The Advances and the
amounts of all payments on the Revolving Credit
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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 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 following rate (the "Adjusted LIBOR
Rate"):
(i) During any period in which the Borrower maintains a
Debt-to-Net Worth Ratio of less than 1.25 to 1:
(a) and a Cash Flow Ratio of less than 1.75 to 1, the LIBOR
Rate plus 1.125%;
(b) and a Cash Flow Ratio of 1.75 to 1 or greater up to and
including 2.5 to 1, the LIBOR Rate plus .875%; or
(c) and a Cash Flow Ratio in excess of 2.5 to 1, the LIBOR
Rate plus .625%;
(ii) During any period in which the Borrower maintains a
Debt-to-Net Worth Ratio equal to or greater than 1.25 to 1 but less
than 1.5 to 1:
(a) and a Cash Flow Ratio of less than 1.75 to 1, the LIBOR
Rate plus 1.25%;
(b) and a Cash Flow Ratio of 1.75 to 1 or greater up to and
including 2.5 to 1, the LIBOR Rate plus 1.00%; or
(c) and a Cash Flow Ratio in excess of 2.5 to 1, the LIBOR
Rate plus .75%.
Notwithstanding the preceding clauses (i) and (ii), if at any time and
during any such period as the outstanding Advances exceed $7,500,000, each of
the percentages set forth in such clauses shall be increased by an additional
.25%. The availability of the preceding clauses (i) and (ii) and the effect of
any change to the Borrower's Debt-to-Net Worth Ratio or Cash Flow Ratio on the
interest rate available pursuant to the preceding clauses (i) and (ii) shall
take effect
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on the first day of the month immediately following the month in which the
Borrower delivers its financial statements pursuant to Section 6.1(a) or (b)
and Compliance Certificate pursuant to Section 6.1(c).
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 3% 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 0.35% per annum
multiplied by the average daily amount by which (a) the Total Revolving Credit
Commitment exceeds (b) the Revolving Credit 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 March 31, 2000 to and on the
Revolver Termination Date. Notwithstanding the foregoing, so long as any Lender
fails to make available any portion of its Revolving Credit Commitment when
requested, such Lender shall not be entitled to receive payment of its pro rata
share of such fee for so long as such Lender shall not
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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 Revolving Credit 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
ADDITIONAL TERMS
3.1. Payments.
3.1.1. 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 3.3, 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 additional compensation requirements set forth in Section 3.3,
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 outstanding principal amount of the Advances
exceeds $30,000,000, the Borrower will immediately prepay the Advances by the
amount of such excess.
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3.1.2. 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.
3.1.3. 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.
3.1.4. 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 Section 2.6 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.
3.2. Capital Adequacy.
3.2.1. 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 3.2.2, 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).
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3.2.2. 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 3.2 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 3.2 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
3.2. 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.
3.3. 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:
3.3.1. 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
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
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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 3.3.1 (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 3.3.1 (a)(ii) or (iii), the Borrower may (and in the case
of a LIBOR Loan affected pursuant to Section 3.3.1 (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
3.3. l(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.
3.3.2. 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 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 3.3.1 (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 3.3.1 (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 3.1 or (iv) as a consequence
of an election made by the Borrower pursuant to Section 3.3.1(b)(y).
3.4. 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
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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 IV
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.
4.1. Organization, Existence and Power. The Borrower is duly incorporated,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation. The Borrower 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. The Borrower 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.
4.2. 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. Each of the Loan Documents
constitutes the legal, valid and binding obligation of the Borrower, enforceable
against the Borrower in accordance with its terms.
4.3. Authority. The Borrower has all requisite corporate power and
authority to execute, deliver and perform its obligations under the Loan
Documents. Neither the authorization, exe-
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cution, delivery, or performance by the Borrower of this Agreement or of any
other Loan Document 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 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 pursuant to, any material instrument,
agreement or other document to which the Borrower is a party or by which the
Borrower or any of its properties may be bound or affected.
4.4. 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 in 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.
4.5. Financial Condition. The audited consolidated balance sheet of the
Borrower and its Subsidiaries dated as of December 31, 1998 and the unaudited
consolidated balance sheet of the Borrower and its Subsidiaries dated as of
September 30, 1999 (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 has 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.
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4.6. 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 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.
4.7. Certain Agreements; Material Contracts. The Borrower is not 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.
4.8. Authorization, Etc. All authorizations, consents, approvals,
accreditations, certifications and licenses required under the corporate charter
or by-laws of the Borrower or under applicable law or regulation for the
ownership or operation of the property owned or operated by the Borrower or the
conduct of any business or activity conducted by the Borrower, 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 has fulfilled and performed all of its 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 Borrower 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.
4.9. No Violation. The execution, delivery and performance by the Borrower
of the Loan Documents do not and will not violate any provision of law or
regulation applicable to the Borrower, or any writ, order or decree of any court
or governmental or regulatory authority or agency applicable to the Borrower.
The Borrower is not 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 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. The Borrower is not 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.
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Except as otherwise set forth in the Disclosure Schedule under the caption
"Litigation," the Borrower has not received notice of any violation of any
federal, state or local environmental law, rule or regulation or assertion that
the Borrower has any obligation to clean up or contribute to the cost of
cleaning up any waste or pollutants.
4.10. 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.
4.11. Transactions With Affiliates, Officers, Directors and 1%
Shareholders. Except as set forth on the Disclosure Schedule., the Borrower has
no Indebtedness to or material contractual arrangement or understanding with any
Affiliate, officer or director of the Borrower, nor any shareholder holding of
record at least 1% of the equity of the Borrower nor, to the best of the
Borrower's knowledge (without independent inquiry), any of their respective
relatives.
4.12. ERISA. The Borrower has never 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 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 any prohibited transaction within the meaning of ERISA
or Section 4975 of the Internal Revenue Code. The Borrower has never maintained,
contributed to or been obligated to contribute to any "multiemployer plan," as
defined in Section 3(37) of ERISA. The Borrower has never incurred any
"withdrawal liability" calculated under Section 4211 of ERISA, and there has
been no event or circumstance that would cause it to incur any such liability.
4.13. Ownership of Properties: Liens. The Borrower has good and marketable
title to all its material properties and assets, real and personal, that are now
carried on its books, including, without limitation, those reflected in the
Financial Statements (except those disposed of in the ordinary course since the
date thereof), and has valid leasehold interests in its properties and assets,
real and personal, which it purports to lease, subject in either case to no
mortgage,
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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 Borrower's
material leasehold interests and material obligations with respect to real
property are described on the Disclosure Schedule.
4.14. 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,
nor is any strike, work stoppage or slowdown pending or threatened against the
Borrower.
4.15. Insurance. The Borrower maintains in force fire, casualty,
comprehensive liability and other insurance coveting its properties and business
that is adequate and customary for the type and scope of its properties and
business.
4.16. 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 has no
outstanding Indebtedness.
4.17. Securities Law Compliance. The Borrower is not an "investment
company" as defined in the Investment Company Act of 1940, as amended. All of
the Borrower's outstanding stock was offered, issued and sold in compliance with
all applicable state and federal securities laws.
4.18. Accuracy of Information. None of the information furnished to the
Lenders by or on behalf of the Borrower 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 V
CONDITIONS TO ADVANCES
The Lenders shall not be obligated to make any Advances unless the
following conditions have been satisfied:
5.1. 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
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the extent that the representations and warranties set forth in Article IV of
this Agreement 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 4.5 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 6.1 (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.
(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.
5.2. 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 the States of Arizona, California, Colorado, Connecticut,
Illinois, Maryland, New Mexico, New York, Oregon, Pennsylvania and Texas,
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;
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(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 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 5.1
has been met as of such date.
(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.
ARTICLE VI
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:
6.1. 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, (i) a consolidated and consolidating balance sheet of the
Borrower and its Subsidiaries as of the end of such quarter and (ii)
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 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 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
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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 6.1 (a) and (b), a certificate
signed by the chief financial officer 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;
(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 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 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; and
(i) 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.
6.2. 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
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outstanding capital stock so long as it does not make aggregate purchases with
such exceeding $6,000,000.
6.3. 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 carded on in
connection therewith may be conducted properly and advantageously at all times.
(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.
6.4. 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,
excerpt 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.
6.5. 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 taw, 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.
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6.6. 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 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.
6.7. 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.
6.8. Bank Accounts. The Borrower shall maintain its principal operating
accounts with the Agent.
ARTICLE VII
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:
7.1. Sale of Assets; Mergers, Etc.
(a) Sale of Assets. The Borrower will not, except 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 seven percent of Borrower's Consolidated
Tangible Net Worth.
(b) Mergers, Etc. Neither the Borrower nor any Subsidiary will
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
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(1) a Subsidiary may consolidate with or merge into 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 in any calendar year, including all contingent liabilities, when
aggregated with all such acquisitions and any Investments permitted under
Section 7.4(3) in any calendar year shall not exceed 25% of Consolidated
Tangible Net Worth as of the end of the most recent fiscal quarter or, if
80% or more of the purchase price is paid in capital stock of the Borrower,
50% of Consolidated Tangible Net Worth as of the end of the most recent
fiscal quarter and (iii) based on a pro forma calculation of the ratios set
forth in Section 7.7 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 Section 7.7.
7.2. Liens and Encumbrances.
(a) Neither the Borrower nor any Subsidiary will (a) cause or permit or
(b) agree or consent to cause or permit in the future (upon the happening of a
contingency or otherwise), 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 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
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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 7.2(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 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) Liens permitted under Existing Loan Agreements;
(6) 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;
(7) Liens existing as of the Closing Date and disclosed on the
Disclosure Schedule hereto;
(8) 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;
(9) 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;
(10) Any Lien on any asset of any corporation existing at the time
such corporation is merged into or consolidated with the Borrower or a
Subsidiary of the Borrower and not created in contemplation of such event;
(11) 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;
(12) 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
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extend to property and assets of the Borrower or any Subsidiary not
financed by such a purchase money obligation;
(13) 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; and
(14) 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 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.
(b) In case any property is subjected to a Lien in violation of Section
7.2(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 7.2(a)
shall constitute an Event of Default hereunder, whether or not any such
provision is made pursuant to this Section 7.2(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).
7.3. Sales and Leasebacks. The Borrower and its Subsidiaries will not 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).
7.4. Investments. Except as permitted by Section 7.1, neither the Borrower
nor any Subsidiary will 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;
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(3) Investments in or to any Subsidiary or other Affiliate, provided
Borrower remains in compliance with Section 7.1(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 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)
that in the aggregate shall not exceed $5,000,000; and
(10) Other Investments existing on the Closing Date and listed on the
Disclosure Schedule.
7.5. Transactions with Affiliates. Neither the Borrower nor any Subsidiary
will 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.
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7.6. ERISA Compliance. Neither the Borrower nor any of its Subsidiaries
wil1 at any time 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:
(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.
7.7. Financial Covenants. The Borrower covenants and agrees that:
(a) Tangible Net Worth Test. The Consolidated Tangible Net Worth as of
the end of each fiscal quarter of the Borrower shall not be less than the sum of
(i) $100,000,000, plus (ii) 50% of Consolidated Net Income (excluding losses),
minus (iii) all Sub S Dividends paid between January 1, 2000 and September 15,
2000 in an aggregate amount not to exceed $6,000,000, for each consecutive
fiscal quarter of the Borrower beginning with the quarter ending December 31,
1999, on a cumulative basis.
(b) Debt-to-Net Worth Ratio. The ratio ("Debt-to-Net Worth Ratio") of
the Consolidated Indebtedness (excluding all guaranties except guaranties with
respect to borrowed money) as of the end of each fiscal quarter of the Borrower
beginning with the fiscal quarter ending December 31, 1999 to its Consolidated
Tangible Net Worth as of the end of each fiscal quarter of the Borrower
beginning with the fiscal quarter ending December 31, 1999 shall not exceed 1.5
to 1.
(c) Cash Flow Ratio. The ratio (the "Cash Flow Ratio") as of the end of
each fiscal quarter of the Borrower of (i) Consolidated Operating Cash Flow for
the four consecutive fiscal quarters then ended to (ii) Consolidated Debt
Service for the four consecutive fiscal quarters then ended shall not be less
than 1.25 to 1.00.
7.8. Contracts Prohibiting Compliance with Agreement. The Borrower will not
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 VIII
EVENTS OF DEFAULT
8.1. Default. If any one of the following events ("Events of Default")
shall occur:
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(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;
(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 $2,000,000 shall be
rendered against or agreed to by the Borrower or any of its Subsidiaries for the
payment of money 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 $2,000,000, 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 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 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 $250,000
against the Borrower or any Subsidiary;
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(g) Default shall be made in the due observance or performance of any
covenant or agreement under Article VII;
(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 VIII) 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 $100,000 by the
Borrower or any of its Subsidiaries;
(j) The transfer by ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and/or his Affiliates of
securities of the Borrower or the voting power related to such securities as a
result of which the power to elect, appoint or cause the election or appointment
of at least a majority of the members of the board of directors of the Borrower
shall no longer be held by ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and/or his Affiliates;
Borrower;
(k) There shall occur any material adverse change in the financial
condition of the Borrower;
(l) There shall occur any Event of Default under either of the Existing
Loan Agreements;
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.
8.2. 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,
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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.
8.3. 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.
8.4. 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.
8.5. 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 VIII, 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 10.4;
(b) amounts due to the Agent pursuant to Section 9.10;
(c) payments of interest on Notes to be applied for the
ratable benefit of the Lenders;
(d) payments of principal of 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 IX
THE AGENT
9.1. Appointment. Each Lender hereby irrevocably designates and appoints
BankBoston as the Agent for the Lenders under this Agreement, and each of the
Lenders hereby irrevocably authorizes BankBoston as the Agent for such Lender,
to take such action on its behalf under the
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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.
9.2. 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 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.
9.3. 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.
9.4. 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
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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.
9.5. 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, 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.
9.6. 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. 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.
9.7. 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
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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 or any
Existing Loan Agreement and shall have the right to determine the order in which
amounts are applied to such obligations.
9.8. 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 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 9.8 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 IX shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent under this Agreement.
9.9. Sharing of Payments, Etc. Each Lender agrees that if it shall, through
the exercise a right of banker's lien, set-off, counterclaim or otherwise,
obtain payment with respect to its Obligations (other than pursuant to Article
V) 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 3.2 or 3.3), 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 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 9.9, the term "pro rata" shall be
determined with respect to the Revolving Credit 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 9.9 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,
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banker's lien or counterclaim) with respect to such portion as fully as if such
Lender were direct holder of such portion.
9.10. 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 X
MISCELLANEOUS
10.1. 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 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 Revolving
Credit Commitment that shall be assigned is $5,000,000, (iv) such assignee shall
have an office located in the United States, and (v) 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 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 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 4.5 or Section 6.1, 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
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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.
(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.
10.2. 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.
10.3. 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
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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.
10.4. 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 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 ▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇, 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.
10.5. 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):
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(a) If to the Agent:
BankBoston, N.A.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Director
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to the Borrower:
MKS Instruments, Inc.
Six ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Treasurer
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, 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.
10.6. 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).
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10.7. 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.
10.8. 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 PROCEEDING
BROUGHT IN SUFFOLK COUNTY IN THE COMMONWEALTH OF MASSACHUSETTS HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM.
10.9. 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
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maximum lawful contract rate shall be construed to require the payment of the
maximum rate only. The provisions of this Section 10.9 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 10.9.
10.10. 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 3.1.4,
Section 9.9 or this Section 10.10, 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 Revolving Credit Commitment of any Lender or
the Total Revolving Credit 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.
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.
10.11. Headings. The headings of this Agreement are for convenience only
and are to affect the construction of or to be taken into account in
interpreting the substance of Agreement.
10.12. 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,
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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.
10.13. 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.
10.14. 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.
10.15. Compliance with Covenants. All computations determining compliance
with Articles 6 and 7 shall utilize accounting principles in conformity with
those used in the preparation of the financial statements referred to in Section
4.5. 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 4.5, the Borrower
shall inform 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.
10.16. 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.
10.17. 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.
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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: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
BANKBOSTON, N.A.
By:
Title:
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
THE CHASE MANHATTAN BANK
By:
Title:
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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48
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:
Title:
BANKBOSTON, N.A.
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Director
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
THE CHASE MANHATTAN BANK
By:
Title:
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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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:
Title:
BANKBOSTON, N.A.
By:
Title:
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
THE CHASE MANHATTAN BANK
By: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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EXHIBIT A
Revolving Applicable
Credit Commitment
Lender Commitment Percentage
------ ---------- ----------
BankBoston, N.A. $18,000,000 60%
The Chase Manhattan Bank $12,000,000 40%
----------- ---
$30,000,000 100%
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