Execution Copy
EXHIBIT 10.15
AMENDED AND RESTATED
FOURTH SECURED TERM LOAN AGREEMENT
DATED AS OF
AUGUST 1, 2003
MSX INTERNATIONAL, INC.
MSX INTERNATIONAL LIMITED
AS BORROWERS
AND
COURT SQUARE CAPITAL LIMITED
AS LENDER
TABLE OF CONTENTS
PAGE
ARTICLE 1 DEFINITIONS............................................................................................ 2
SECTION 1.1. Certain Defined Terms............................................................. 2
SECTION 1.2. Other Definitions; Rules of Construction.......................................... 30
SECTION 1.3. Accounting Terms and Determinations............................................... 31
ARTICLE 2 AMOUNT AND TERMS OF NOTES AND LOANS; EXCHANGE.......................................................... 31
SECTION 2.1. Loans and Notes................................................................... 31
SECTION 2.2. Interest on the Loan; Tax Amounts................................................. 31
SECTION 2.3. Prepayments and Payments.......................................................... 34
SECTION 2.4. Intentionally Omitted............................................................. 37
SECTION 2.5. Fees.............................................................................. 37
SECTION 2.6. Guaranties; Security and Collateral............................................... 37
ARTICLE 3 CONDITIONS............................................................................................. 39
SECTION 3.1. Conditions to this Agreement...................................................... 39
ARTICLE 4 REPRESENTATIONS AND WARRANTIES......................................................................... 40
SECTION 4.1. Corporate Existence and Power..................................................... 40
SECTION 4.2. Corporate Authority............................................................... 41
SECTION 4.3. Binding Effect.................................................................... 41
SECTION 4.4. Subsidiaries...................................................................... 41
SECTION 4.5. Proceedings....................................................................... 41
SECTION 4.6. Financial Condition............................................................... 41
SECTION 4.7. Consents, Etc..................................................................... 42
SECTION 4.8. Taxes............................................................................. 42
SECTION 4.9. Title to Properties; Applicable Agreements........................................ 43
SECTION 4.10. ERISA............................................................................. 43
SECTION 4.11. Disclosure........................................................................ 43
SECTION 4.12. Environmental and Safety Matters.................................................. 43
SECTION 4.13. No Default........................................................................ 44
SECTION 4.14. Intellectual Property............................................................. 44
SECTION 4.15. Labor Matters..................................................................... 44
SECTION 4.16. Solvency.......................................................................... 45
SECTION 4.17. Not an Investment Company......................................................... 45
SECTION 4.18. Insurance......................................................................... 45
ARTICLE 5 AFFIRMATIVE COVENANTS.................................................................................. 46
SECTION 5.1. SEC Reports....................................................................... 46
SECTION 5.2. Additional Security and Collateral................................................ 46
SECTION 5.3. Real Estate Mortgages and Filings................................................. 47
SECTION 5.4. Designation of Restricted and Unrestricted Subsidiaries........................... 47
SECTION 5.5. Compliance Certificate............................................................ 49
SECTION 5.6. Further Instruments and Acts...................................................... 49
SECTION 5.7. Payment of Taxes and Other Claims................................................. 49
SECTION 5.8. Corporate Existence............................................................... 49
ARTICLE 6 NEGATIVE COVENANTS..................................................................................... 49
SECTION 6.1. Limitation on Incurrence of Indebtedness.......................................... 49
SECTION 6.2. Limitation on Liens............................................................... 51
SECTION 6.3. Limitation on Sale of Assets and Subsidiary Stock................................. 51
SECTION 6.4. Limitation on Restricted Payments................................................. 53
SECTION 6.5. Limitation on Affiliate Transactions.............................................. 55
SECTION 6.6. Impairment of Security Interests.................................................. 56
SECTION 6.7. Limitations on Restrictions on Distributions from Restricted Subsidiaries......... 57
SECTION 6.8. Limitation on Issuance or Sale of Capital Stock of Restricted Subsidiaries........ 58
SECTION 6.9. Merger and Consolidation.......................................................... 58
SECTION 6.10. Waiver of Stay, Extension and Usury Laws.......................................... 61
SECTION 6.11. Limitation on Capital Expenditures................................................ 61
SECTION 6.12. Prohibited Transfers of Accounts Receivable....................................... 61
ARTICLE 7 DEFAULTS AND REMEDIES.................................................................................. 61
SECTION 7.1. Events of Default................................................................. 61
SECTION 7.2. Remedies.......................................................................... 63
ARTICLE 8 MISCELLANEOUS.......................................................................................... 65
SECTION 8.1. Participations in Loans and Notes................................................. 65
SECTION 8.2. Expenses.......................................................................... 65
SECTION 8.3. Indemnity......................................................................... 66
SECTION 8.4. Amendments and Waivers............................................................ 67
SECTION 8.5. Independence of Covenants......................................................... 67
SECTION 8.6. Notices........................................................................... 67
SECTION 8.7. Survival of Warranties and Certain Agreements..................................... 69
SECTION 8.8. Failure or Indulgence Not Waiver; Remedies Cumulative............................. 69
SECTION 8.9. Severability...................................................................... 70
SECTION 8.10. Headings.......................................................................... 70
SECTION 8.11. Applicable Law.................................................................... 70
SECTION 8.12. Successors and Assigns; Subsequent Holders of Notes............................... 70
SECTION 8.13. Consent to Jurisdiction and Service of Process.................................... 70
SECTION 8.13. APPEAL............................................................................ 71
SECTION 8.14. Waiver of Jury Trial.............................................................. 71
SECTION 8.15. Counterparts; Effectiveness....................................................... 71
SECTION 8.16. Entirety.......................................................................... 71
SECTION 8.17. Confidentiality................................................................... 72
SECTION 8.18. Conversion of Currency............................................................ 72
SECTION 8.19. Acknowledgments................................................................... 73
SECTION 8.20. Reaffirmation; Release............................................................ 73
Schedules
Schedule 4.4 - Subsidiaries
Schedule 4.8 - Taxes
Schedule 4.15 - Labor Matters
Exhibits
Exhibit A-1 - Form of Amended and Restated Company Note
Exhibit A-2 - Form of MSX Limited Note
Exhibit B-1 - Form of Amended and Restated Guaranty (Subsidiaries)
Exhibit B-2 - Form of Guaranty (Company)
Exhibit C-1 - Form of Amended and Restated Pledge Agreement (Company)
Exhibit C-2 - Form of Amended and Restated Pledge Agreement (Subsidiaries)
Exhibit D-1 - Form of Amended and Restated Security Agreement (Company)
Exhibit D-2 - Form of Amended and Restated Security Agreement (Subsidiaries)
Exhibit D-3 - Form of U.K. Deed
AMENDED AND RESTATED FOURTH SECURED TERM LOAN AGREEMENT (the
"Agreement"), dated as of August 1, 2003, by and among MSX INTERNATIONAL, INC.,
a Delaware corporation (the "Company"), MSX INTERNATIONAL LIMITED, a company
incorporated under the laws of England and Wales ("MSX Limited" and together
with the Company, each a "Borrower" and collectively the "Borrowers"), and COURT
SQUARE CAPITAL LIMITED, a Delaware corporation (the "Lender").
WHEREAS, the Company and Lender are parties to that certain
Second Secured Term Loan Agreement, dated as of July 31, 2002, as amended by the
First Amendment to Second Secured Term Loan Agreement dated as of February 14,
2003 (the "Original Agreement"), under which (i) the Lender made a loan to the
Company in the amount of $15,450,000 and (ii) the Lender may be required to make
one or more additional loans to the Company in an aggregate amount of up to
$10,769,105.90 (the "Credit Support Loan"), in accordance with the terms of the
Funding Agreement (as defined herein).
WHEREAS, the Company desires to refinance certain debt
obligations by entering into (i) that certain Amended and Restated Credit
Agreement, dated the date hereof, among the Company, each of the borrowing
subsidiaries of the Company party thereto from time to time, the lenders party
thereto from time to time (the "Senior Lenders") and Bank One, N.A., a national
banking association, as agent for the Senior Lenders (as amended or modified
from time to time, the "Restated Senior Credit Agreement"), (ii) that certain
Senior Secured Indenture, dated the date hereof, among the Company and MSX
Limited as issuers, the subsidiary guarantors named therein and BNY Midwest
Trust Company, as trustee (as amended or modified from time to time, the "Senior
Secured Note Indenture") and (iii) the Third Lien Loan Agreement (as defined
herein).
WHEREAS, in conjunction with entering into the Restated Senior
Credit Agreement, the Senior Secured Note Indenture and the Third Lien Loan
Agreement, the Company and MSX Limited have requested that the Lender consent to
the incurrence of the indebtedness contemplated by the Senior Secured Note
Indenture and Third Lien Loan Agreement and amend and restate the Original
Agreement to, among other things, (i) exchange all promissory notes of the
Company outstanding under the Original Agreement for new promissory notes of the
Borrowers, (ii) extend the maturity date of the notes and (iii) revise certain
covenants and events of default contained herein. The Lender is willing to give
its and consent and to amend and restate the Original Agreement provided that
the Funding Agreement and Lender's obligation to make any Credit Support Loans
are terminated, and on the other terms and conditions of this Agreement.
WHEREAS, it is the intent of the parties hereto that this
Agreement does not constitute a novation of the rights, obligations and
liabilities of the respective parties existing under the Original Agreement, and
such rights, obligations and liabilities (except for obligations relating to the
Credit Support Loans) shall continue and remain outstanding as modified herein,
and that this Agreement amends and restates in its entirety the Original
Agreement.
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, the Borrower and the
Lender hereby agree that, effective as of the Effective Date, the Original
Agreement is hereby amended and restated in its entirety to read as follows:
ARTICLE 1 DEFINITIONS
SECTION 1.1. Certain Defined Terms.
The following terms used in this Agreement shall have the
following meanings:
"Acquired Indebtedness" means Indebtedness of a Person or any
of its Subsidiaries existing at the time such Person becomes a Restricted
Subsidiary of the Company or at the time it merges or consolidates with or into
the Company or any of its Restricted Subsidiaries or assumed in connection with
the acquisition of assets from such Person and in each case not incurred by such
Person in connection with, or in anticipation or contemplation of, such Person
becoming a Restricted Subsidiary of the Company or such acquisition, merger or
consolidation. Acquired Indebtedness shall be deemed to be Incurred on the date
of the related acquisition of assets from a Person on the date the acquired
Person becomes a Restricted Subsidiary.
"Act" means the Securities Act of 1933, as amended.
"Additional Amounts" means such "Additional Amounts" (as
defined in the Senior Secured Note Indenture) as may be required to be paid by
MSX Limited on the U.K. Senior Secured Notes in accordance with the terms of the
Senior Secured Note Indenture.
"Additional Tax Amounts" has the meaning set forth in Section
2.2(e) of this Agreement.
"Additional Assets" means (i) any property or assets (other
than Indebtedness and Capital Stock) in a Related Business, including
improvements to existing assets, used by the Company or a Restricted Subsidiary
in a Related Business; (ii) the Capital Stock of a Person that becomes a
Restricted Subsidiary as a result of the acquisition of such Capital Stock by
the Company or another Restricted Subsidiary; provided, however, that any such
Restricted Subsidiary is primarily engaged in a Related Business; (iii) Capital
Stock constituting an additional equity interest in any Person that at such time
is a Restricted Subsidiary that is not a Wholly-Owned Subsidiary; or (iv) the
costs of improving or developing any property owned by the Company or a
Restricted Subsidiary that is used in a Related Business.
"Affiliate" of any specified Person means any other Person,
directly or indirectly, controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
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"controlling" and "controlled" have meanings correlative to the foregoing. For
purposes of Section 6.4 (Limitation on Restricted Payments), Section 6.5
(Limitation on Affiliate Transactions) and Section 6.3 (Limitations on Sales of
Assets and Subsidiary Stock) only, "Affiliate" shall also mean any beneficial
owner of Capital Stock representing 10% or more of the total voting power of the
Voting Stock (on a fully diluted basis) of the Company or of rights or warrants
to purchase such Capital Stock (whether or not currently exercisable) and any
Person who would be an Affiliate of any such beneficial owner pursuant to the
first sentence hereof.
"Affiliate Transaction" has the meaning assigned to it in
Section 6.5(a) of this Agreement.
"Agent" means Bank One, NA, as agent under the Senior Credit
Facility, and any replacement or substitute agent under the Senior Credit
Facility.
"Applicable Agreements" mean any bond, debenture, note, or
other evidence of indebtedness, indenture, mortgage, deed of trust, lease, or
any other agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which any of them or their respective property is
bound.
"Applicable Indebtedness" means:
(1) in respect of any asset that is the subject of an Asset
Disposition at a time when such asset is included in the Collateral,
Pari Passu Indebtedness or Indebtedness of a Subsidiary of the Company
that, in each case, is secured at such time by Collateral under a Lien
that is senior or prior to the Lien securing the Senior Secured Notes
pursuant to the Collateral Agreements; or
(2) in respect of any other asset, any Pari Passu Indebtedness
or any unsubordinated Indebtedness of any Guarantor, and in the case of
an Asset Disposition by a Subsidiary that is not a Guarantor,
Indebtedness of such Subsidiary, or any other obligations under the
Senior Credit Facility.
"Applicable Pari Passu Indebtedness" means:
(1) in respect of any asset that is the subject of an Asset
Disposition at a time when such asset is included in the Collateral,
Pari Passu Indebtedness that is secured at such time by all or any part
of the Collateral; or
(2) in respect of any other asset, any Pari Passu
Indebtedness.
"Asset Disposition" means any sale, lease, transfer,
Sale/Leaseback Transaction or other disposition (or series of related sales,
leases, transfers or dispositions) by the Company or any Restricted Subsidiary,
including any disposition by means of a merger, consolidation or similar
transaction (each referred to for the purposes of this definition as a
"disposition"), of
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(i) any shares of Capital Stock of a Restricted Subsidiary
(other than directors' qualifying shares and shares owned by foreign
shareholders to the extent required by applicable local laws in foreign
countries),
(ii) all or substantially all the assets of any division,
business segment or comparable line of business of the Company or any
Restricted Subsidiary or
(iii) any other assets of the Company or any Restricted
Subsidiary outside of the ordinary course of business of the Company or
such Restricted Subsidiary.
Notwithstanding the foregoing, the term "Asset Disposition" shall not
include: (x) a disposition by a Restricted Subsidiary to the Company or by the
Company or a Restricted Subsidiary to a Guarantor, (y) for purposes of Section
6.3 (Limitation on Sales of Assets and Subsidiary Stock), a disposition that
constitutes a Permitted Investment or a Restricted Payment permitted by the
covenant described under Section 6.4 (Limitation on Restricted Payments), and
(z) any single disposition or series of related dispositions of assets having a
fair market value of less than $1,000,000.
"Assignees" has the meaning assigned to it in Section 8.1(b)
of this Agreement.
"Attributable Debt" in respect of a Sale/Leaseback Transaction
means, as at the time of determination, the present value (discounted at the
interest rate borne by the Senior Secured Notes, compounded annually) of the
total obligations of the lessee for rental payments during the remaining term of
the lease included in such Sale/Leaseback Transaction (including any period for
which such lease has been extended).
"Average Life" means, as of the date of determination, with
respect to any Indebtedness or Preferred Stock, the quotient obtained by
dividing (i) the sum of the products of the numbers of years from the date of
determination to the dates of each successive scheduled principal payment of
such Indebtedness or redemption or similar payment with respect to such
Preferred Stock multiplied by the amount of such payment by (ii) the sum of all
such payments.
"Bankruptcy Code" means the Bankruptcy Reform Act of 1978, as
amended, and codified 11 U.S.C. Sections 101 et seq.
"Bankruptcy Law" has the meaning assigned to it in Section 7.1
of this Agreement.
"Board of Directors" means the Board of Directors of the
Company or MSX Limited, as applicable, or any committee thereof duly authorized
to act on behalf of such Board of Directors.
"Borrowers" has the meaning assigned to that term in the
introduction to this Agreement and shall include any successors and permitted
assignees of the Loans or Notes in accordance with Section 8.1 hereof.
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"Business Day" means each day that is not a Legal Holiday.
"Capital Expenditures" means for any period all direct or
indirect (by way of acquisition of securities of a Person or the expenditure of
cash or the transfer of property or the incurrence of Indebtedness) expenditures
in respect of the purchase or other acquisition of fixed or capital assets
determined in conformity with GAAP.
"Capital Lease Obligations" means an obligation that is
required to be classified and accounted for as a capital lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation shall be the capitalized amount of such
obligation determined in accordance with GAAP; and the Stated Maturity thereof
shall be the date of the last payment of rent or any other amount due under such
lease prior to the first date upon which such lease may be terminated by the
lessee without payment of a penalty.
"Capital Stock" of any Person means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) equity of such Person,
including any Preferred Stock, but excluding any debt securities convertible
into such equity.
"Cash" means such coin or currency of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Cash Equivalents" means (i) cash in Dollars or, so long as
not held for speculative purposes, any Eligible Currency, (ii) securities issued
or directly and fully guaranteed or insured by the United States of America,
France, Germany, the U.K., any other member state of the European Union,
Australia or any other sovereign nation acceptable to the Lender or any agency
or instrumentality thereof having maturities of not more than six months from
the date of acquisition, (iii) marketable direct obligations issued by any state
of the United States of America or any political subdivision of any such state
or any public instrumentality thereof maturing within one year from the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either Standard & Poor's Corporation ("S&P") or
Xxxxx'x Investors Service, Inc. ("Moody's"), (iv) certificates of deposit and
eurodollar time deposits with maturities of six months or less from the date of
acquisition, bankers' acceptances with maturities not exceeding six months and
overnight bank deposits, in each case with any Lender or with any domestic or
foreign commercial bank or U.S. branch of a foreign bank licensed under the laws
of the United States or a State thereof having capital and surplus in excess of
$250,000,000 and a Xxxxx Bank Watch Rating of "B" or better or the equivalent
rating from comparable foreign rating agencies, and certificates of deposit and
time deposits with maturities of one month or less from the date of acquisition
and overnight bank deposits with reputable foreign commercial banks, (v)
repurchase obligations with a term of not more than seven days for underlying
securities of the types described in clauses (ii), (iii) and (iv) above entered
into with any financial institution meeting the qualifications specified in
clause (iv) above, (vi) commercial paper having one of the two highest ratings
obtained from Moody's or S&P or the equivalent ratings from comparable foreign
rating agencies and in each case maturing within six months after the date of
acquisition and (vii) investments in money market
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funds which invest substantially all their assets in securities of the type
described in clauses (i) through (vi) above.
"Cash Management Obligations" means, with respect to any
Person, all obligations, whether absolute or contingent, of such Person in
respect of overdrafts, returned items and other liabilities owed to any other
Person that arises from treasury, depository, foreign exchange (including
without limitation foreign currency hedging obligations) or cash management
services, including without limitation in connection with any automated clearing
house transfers of funds, wire transfer services, controlled disbursement
accounts or similar transactions, and all obligations in connection with any
commercial credit cards or stored value cards..
"Change of Control" means the occurrence of one or more of the
following events:
(1) prior to the first public offering of common stock of
the Company or MSX Limited, as applicable, the Permitted Holders cease to be
entitled (by "beneficial ownership" (as defined in Rules 13d-3 and 13d-5 under
the Exchange Act) of Voting Stock, contract or otherwise) to elect or cause the
election of directors having a majority in the aggregate of the total voting
power of the Board of Directors, whether as a result of issuance of securities
of the Company or MSX Limited, as applicable, any merger, consolidation,
liquidation or dissolution of the Company or MSX Limited, as applicable, any
direct or indirect transfer of securities by the Permitted Holders or otherwise
(for purposes of this clause (i) and clause (ii) below, the Permitted Holders
shall be deemed to beneficially own any Voting Stock of any entity (the
"specified entity") held by any other entity (the "parent entity") so long as
the Permitted Holders beneficially own (as so defined), directly or indirectly,
in the aggregate a majority of the voting power of the Voting Stock of such
parent entity);
(2) after the first public offering of common stock of
the Company or MSX Limited, as applicable, after the Effective Date, any
"person" (as such term is used in Sections 13(d) and 14(d) of the Exchange Act),
other than one or more Permitted Holders, is or becomes the beneficial owner (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that for
purposes of this clause (2) such person shall be deemed to have "beneficial
ownership" of all shares that any such person has the right to acquire, whether
such right is exercisable immediately or only after the passage of time),
directly or indirectly, of more than 35% of the total voting power of the Voting
Stock of the Company or MSX Limited, as applicable, and one or more Permitted
Holders beneficially own (as defined in clause (1) above), directly or
indirectly, in the aggregate a lesser percentage of the total voting power of
the Voting Stock of the Company or MSX Limited, as applicable, than such other
Person and do not have the right or ability by voting power, contract or
otherwise to elect or designate for election a majority of the Board of
Directors of the Company or MSX Limited, as applicable;
(3) during any two year period, individuals who on the
Effective Date constituted the Board of Directors of the Company or MSX Limited,
as applicable (together with any new directors whose election by such
shareholders of the Company or MSX Limited, as
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applicable, or whose nomination for election by the Board of Directors of the
Company or MSX Limited, as applicable, was approved by a vote of a majority of
the directors of the Company or MSX Limited, as applicable, then still in office
who were either directors on the Effective Date or whose election or nomination
for election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Company or MSX Limited, as applicable,
then in office;
(4) the approval by the holders of Capital Stock of the
Company or MSX Limited, as applicable, of a plan for the liquidation or
dissolution of the Company or MSX Limited, as applicable; or
(5) the merger or consolidation of the Company or MSX
Limited, as applicable, with or into another Person or the merger of another
Person with or into the Company or MSX Limited, as applicable, or the sale of
all or substantially all the assets of the Company or MSX Limited, as
applicable, (determined on a consolidated basis) to another Person (other than,
in all such cases, a Person that is controlled by one or more of the Permitted
Holders), other than a transaction following which (A) in the case of a merger
or consolidation transaction, holders of securities that represented 100% of the
Voting Stock of the Company or MSX Limited, as applicable, immediately prior to
such transaction (or other securities into which such securities are converted
as part of such merger or consolidation transaction) own directly or indirectly
at least a majority of the voting power of the Voting Stock of the surviving
Person in such merger or consolidation transaction immediately after such
transaction or have the right or ability by voting power, contract or otherwise
to elect or designate for election a majority of the Board of Directors of the
Company or MSX Limited, as applicable, and (B) in the case of a sale of assets
transaction, each transferee becomes an obligor in respect of the Notes and a
Subsidiary of the transferor of such assets.
A Change of Control of MSX Limited does not constitute a Change of Control of
the Company.
"Charged Assets" shall have the meaning set forth in the U.K.
Deed.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" shall means all collateral (other than Excluded
Collateral) securing the Obligations as set forth in Section 2.6 hereof, the
Charged Assets and any other property, whether now owned or hereafter acquired,
upon which a Lien securing the Obligations is granted or purported to be granted
under any Security Document.
"Collateral Agent" means the collateral agent under the
Indenture Security Agreement and each Mortgage, which shall initially be the
Trustee.
"Collateral Agreements" means, collectively, the Intercreditor
Agreement, the Indenture Security Agreement, the Indenture U.K. Deed and each
Mortgage, in each case, as the same may be in force from time to time.
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"Commitments" has the meaning assigned to such term in the
Senior Credit Facility.
"Company" means MSX International, Inc., a Delaware
corporation, together with its permitted successors and assigns.
"Company Guarantee" means the Guarantee of the Company of MSX
Limited's obligations with respect to the U.K. Senior Secured Notes.
"Company Notes" means one or more of the notes of the Company
issued pursuant to the terms and conditions of Sections 2.1 or 8.1 hereof,
substantially in the form of Exhibit A-1 to this Agreement.
"Consolidated Coverage Ratio" as of any date of determination
means the ratio of: (i) the aggregate amount of EBITDA for the period of the
most recent four consecutive fiscal quarters ending at least 45 days (or, if
less, the number of days after the end of such fiscal quarter as the
consolidated financial statements of the Company shall be available) prior to
the date of such determination to (ii) Consolidated Interest Expense for such
four fiscal quarters; provided, however, that:
(1) if the Company or any Restricted Subsidiary has
Incurred any Indebtedness since the beginning of such period that remains
outstanding on such date of determination or if the transaction giving rise to
the need to calculate the Consolidated Coverage Ratio is an Incurrence of
Indebtedness, or both, EBITDA and Consolidated Interest Expense for such period
shall be calculated after giving effect on a pro forma basis to such
Indebtedness as if such Indebtedness had been Incurred on the first day of such
period and the discharge of any other Indebtedness repaid, repurchased, defeased
or otherwise discharged with the proceeds of such new Indebtedness as if such
discharge had occurred on the first day of such period (except that, in the case
of Indebtedness used to finance working capital needs incurred under a revolving
credit or similar arrangement, the amount thereof shall be deemed to be the
average daily balance of such Indebtedness during such four-fiscal-quarter
period);
(2) if since the beginning of such period the Company or
any Restricted Subsidiary shall have made any Asset Disposition, the EBITDA for
such period shall be reduced by an amount equal to the EBITDA (if positive)
directly attributable to the assets which are the subject of such Asset
Disposition for such period, or increased by an amount equal to the EBITDA (if
negative) directly attributable thereto for such period, and Consolidated
Interest Expense for such period shall be reduced by an amount equal to the
Consolidated Interest Expense directly attributable to any Indebtedness of the
Company or any Restricted Subsidiary repaid, repurchased, defeased, assumed by a
third person (to the extent the Company and its Restricted Subsidiaries are no
longer liable for such Indebtedness) or otherwise discharged with respect to the
Company and its continuing Restricted Subsidiaries in connection with such Asset
Disposition for such period (or, if the Capital Stock of any Restricted
Subsidiary is sold, the Consolidated Interest Expense for such period directly
attributable to the Indebtedness of such
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Restricted Subsidiary to the extent the Company and its continuing Restricted
Subsidiaries are no longer liable for such Indebtedness after such sale);
(3) if since the beginning of such period the Company
shall have consummated a Public Equity Offering following which there is a
Public Market, Consolidated Interest Expense for such period shall be reduced by
an amount equal to the Consolidated Interest Expense directly attributable to
any Indebtedness of the Company or any Restricted Subsidiary repaid,
repurchased, defeased or otherwise discharged with respect to the Company and
its Restricted Subsidiaries in connection with such Public Equity Offering for
such period;
(4) if since the beginning of such period the Company or
any Restricted Subsidiary (by merger or otherwise) shall have made an Investment
in any Restricted Subsidiary (or any Person which becomes a Restricted
Subsidiary) or an acquisition of assets, which acquisition constitutes all or
substantially all of an operating unit of a business, including any such
Investment or acquisition occurring in connection with a transaction requiring a
calculation to be made hereunder, EBITDA and Consolidated Interest Expense for
such period shall be calculated after giving pro forma effect thereto (including
the Incurrence of any Indebtedness) as if such Investment or acquisition
occurred on the first day of such period; and
(5) if since the beginning of such period any Person
(that subsequently became a Restricted Subsidiary or was merged with or into the
Company or any Restricted Subsidiary since the beginning of such period) shall
have made any Asset Disposition, any Investment or acquisition of assets that
would have required an adjustment pursuant to clause (3) or (4) above if made by
the Company or a Restricted Subsidiary during such period, EBITDA and
Consolidated Interest Expense for such period shall be calculated after giving
pro forma effect thereto as if such Asset Disposition, Investment or acquisition
occurred on the first day of such period.
For purposes of this definition, whenever pro forma effect is
to be given to an acquisition of assets, the amount of income or earnings
relating thereto and the amount of Consolidated Interest Expense associated with
any Indebtedness Incurred in connection therewith, the pro forma calculations
shall be determined in good faith by a responsible financial or accounting
Officer of the Company in accordance with Article 11 of Regulation S-X. If any
Indebtedness bears a floating rate of interest and is being given pro forma
effect, the interest on such Indebtedness shall be calculated as if the rate in
effect on the date of determination had been the applicable rate for the entire
period (taking into account any Interest Rate Agreement applicable to such
Indebtedness if such Interest Rate Agreement has a remaining term in excess of
12 months).
"Consolidated Interest Expense" means, for any period, the
total interest expense of the Company and its consolidated Restricted
Subsidiaries, plus, to the extent not included in such total interest expense,
and to the extent incurred by the Company or its Restricted Subsidiaries, (i)
interest expense attributable to Capital Lease Obligations, (ii) amortization of
debt discount, (iii) capitalized interest, (iv) non-cash interest expenses, (v)
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers'
- 9 -
acceptance financing, (vi) net costs associated with Hedging Obligations
(including amortization of fees), and (vii) interest actually paid on any
Indebtedness of any other Person that is Guaranteed by the Company or any
Restricted Subsidiary.
"Consolidated Net Income" means, for any period, the net
income of the Company and its consolidated Subsidiaries; provided, however, that
there shall not be included in such Consolidated Net Income:
(i) any net income (or loss) of any Person if such Person
is not a Restricted Subsidiary, except that subject to the exclusion contained
in clause (iv) below, the Company's equity in the net income of any such Person
for such period shall be included in such Consolidated Net Income up to the
aggregate amount of cash actually distributed by such Person during such period
to the Company or a Restricted Subsidiary as a dividend or other distribution
(subject, in the case of a dividend or other distribution paid to a Restricted
Subsidiary, to the limitations contained in clause (iii) below);
(ii) for purposes of subclause (a)(3)(A) of Section 6.4
(Limitation on Restricted Payments) only, any net income (or loss) of any Person
acquired by the Company or a Subsidiary in a pooling of interests transaction
for any period prior to the date of such acquisition;
(iii) any net income of any Restricted Subsidiary if such
Restricted Subsidiary is subject to restrictions, directly or indirectly, on the
payment of dividends or the making of distributions by such Restricted
Subsidiary, directly or indirectly, to the Company, except that (A) subject to
the exclusion contained in clause (iv) below, the Company's equity in the net
income of any such Restricted Subsidiary for such period shall be included in
such Consolidated Net Income up to the aggregate amount of cash that could have
been distributed by such Restricted Subsidiary consistent with such restriction
during such period to the Company or another Restricted Subsidiary as a dividend
or other distribution (subject, in the case of a dividend or other distribution
paid to another Restricted Subsidiary, to the limitation contained in this
clause) and (B) the Company's equity in a net loss of any such Restricted
Subsidiary for such period shall be included in determining such Consolidated
Net Income;
(iv) any gain (or loss) realized upon the sale or other
disposition of any assets of the Company or its consolidated Subsidiaries
(including pursuant to any sale-and-leaseback arrangement) which is not sold or
otherwise disposed of in the ordinary course of business and any gain (or loss)
realized upon the sale or other disposition of any Capital Stock of any Person;
(v) extraordinary gains or losses; and
(vi) the cumulative effect of a change in accounting
principles.
Notwithstanding the foregoing, for the purposes of Section 6.4
(Limitation on Restricted Payments) only, there shall be excluded from
Consolidated Net Income any dividends, repayments of loans or advances or other
transfers of assets from Unrestricted Subsidiaries to the
- 10 -
Company or a Restricted Subsidiary to the extent such dividends, repayments or
transfers increase the amount of Restricted Payments permitted under such
Section pursuant to clause (a)(3)(D) thereof.
"Consolidated Net Worth" means the total of the amounts shown
on the balance sheet of the Company and its consolidated Subsidiaries,
determined on a consolidated basis in accordance with GAAP, as of the end of the
most recent fiscal quarter of the Company ending at least 45 days prior to the
taking of any action for the purpose of which the determination is being made,
as (i) the par or stated value of all outstanding Capital Stock of the Company
plus (ii) paid-in capital or capital surplus relating to such Capital Stock plus
(iii) any retained earnings or earned surplus less (A) any accumulated deficit
and (B) any amounts attributable to Disqualified Stock.
"Credit Support Loan" has the meaning assigned to that term in
the introduction to this Agreement.
"Currency Agreement" means, with respect to any Person, any
foreign exchange contract, currency swap agreement or other similar agreement to
which such Person is a party or a beneficiary.
"Custodian" has the meaning assigned to it in Section 7.1 of
this Agreement.
"CVC" means Citicorp Venture Capital, Ltd., a New York
corporation.
"CVC Investor" means (i) CVC or any direct or indirect
Subsidiary of CVC, (ii) Citigroup Inc. or any direct or indirect Subsidiary of
Citigroup Inc. or any other Person controlled by Citigroup Inc. and (iii) any
officer, employee or director of CVC so long as such person shall be an
employee, officer or director of CVC or any direct or indirect Wholly-Owned
Subsidiary of CVC.
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
"Designee" has the meaning assigned to that term in Section
5.4(a) of this Agreement.
"Disqualified Stock" means, with respect to any Person, any
Capital Stock which by its terms (or by the terms of any security into which it
is convertible or for which it is exchangeable) or upon the happening of any
event (i) matures or is mandatorily redeemable pursuant to a sinking fund
obligation or otherwise, (ii) is convertible or exchangeable, at the option of
the Holder thereof, for Indebtedness or Disqualified Stock or (iii) is
redeemable at the option of the Holder thereof, in whole or in part, in each
case on or prior to the eleven month anniversary of the Stated Maturity of the
Senior Secured Notes. Disqualified Stock shall not include any Capital Stock
that is not otherwise Disqualified Stock if by its terms the Holders have the
right to require the issuer to repurchase such stock (or such stock is
mandatorily
- 11 -
redeemable) upon a Change of Control (or upon an event substantially similar to
a Change of Control).
"Dollar" and "$" means dollars in the lawful currency of the
United States of America.
"Dollar Equivalent" means as of any date, with respect to any
amount in a currency other than Dollars, the sum in Dollars resulting from the
conversion of such amount from such currency into Dollars at the most favorable
spot exchange rate determined by the Lender to be available to it for the
purchase of such currency with Dollars at approximately 11:00 a.m. local time of
any office(s), branch(es), Subsidiary(ies) or Affiliate(s) of the Lender
selected by the Lender and notified to the Company on such date as a
determination of the Dollar Equivalent is made.
"Domestic Restricted Subsidiary" means any Restricted
Subsidiary of the Company other than a Foreign Restricted Subsidiary.
"EBITDA" for any period means the sum of Consolidated Net
Income plus, without duplication, the following to the extent deducted in
calculating such Consolidated Net Income: (i) Consolidated Interest Expense,
(ii) income tax expense (including Michigan Single Business Tax expense and the
Imposta Reginole Sulle Attivista Producttive expense in Italy), (iii)
depreciation expense, (iv) amortization expense and (v) all other non-cash items
reducing Consolidated Net Income (other than items that will require cash
payments and for which an accrual or reserve is, or is required by GAAP to be,
made, other than accruals for post-retirement benefits other than pensions),
less all non-cash items increasing Consolidated Net Income, in each case for
such period. Notwithstanding the foregoing, the provision for taxes based on the
income or profits of, and the depreciation and amortization of, a Subsidiary of
the Company shall be added to Consolidated Net Income to compute EBITDA only to
the extent (and in the same proportion) that the net income of such Subsidiary
was included in calculating Consolidated Net Income.
"Effective Date" means August 1, 2003, provided that the
effectiveness of this Agreement is subject to the satisfaction of all of the
conditions set forth in Article 3.
"Eligible Currency" means the euro, Francs, Deutsche Marks,
Pounds Sterling, Italian Lire, Australian Dollars (all as defined in the Senior
Credit Facility) and any other currency (other than Dollars) which is approved
and designated as an Eligible Currency by the Lender, provided that each of the
foregoing currencies is and remains readily available, freely traded, in which
deposits are customarily offered to banks in the London interbank market,
convertible into Dollars in the international interbank market and as to which
the Dollar Equivalent may be readily calculated. If, after the designation of
any currency as an Eligible Currency, currency control or other exchange
regulations are imposed in the country in which such currency is issued with the
result that different types of such currency are introduced, or such country's
currency is, in the determination of the Lender, no longer readily available or
freely traded or as to which, in the determination of the Lender, a Dollar
Equivalent is not readily calculable, then the Lender shall promptly notify the
Company and such country's currency shall
- 12 -
no longer be an Eligible Currency until such time as the Lender agrees to
reinstate such country's currency as an Eligible Currency.
"Environmental Laws" has the meaning assigned to that term in
Section 4.12 of this Agreement.
"ERISA" has the meaning assigned to that term in Section 4.10
of this Agreement.
"ERISA Affiliate" has the meaning assigned to that term in
Section 4.10 of this Agreement.
"Event of Default" has the meaning assigned to that term in
Section 7.1 hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Notes" means any notes exchanged for the Senior
Secured Notes pursuant to the Registration Rights Agreement.
"Excluded Collateral" is defined in Section 2.6 hereof.
"Existing Affiliate Agreements" means the Stockholders'
Agreement, the MSX Registration Rights Agreement and any other existing
agreement with CVC or any Affiliates of CVC or the Company listed on Schedule I
to the Senior Secured Note Indenture.
"Final Offering Circular" means the final offering circular of
the Company, dated July 25, 2003, prepared in connection with the offering of
the Units of Senior Secured Notes.
"Financial Statements" has the meaning assigned to that term
in Section 4.6 of this Agreement.
"Foreign Restricted Subsidiary" means any Restricted
Subsidiary of the Company which is not organized under the laws of the United
States of America or any State thereof or the District of Columbia.
"Foreign Subsidiary" means any Subsidiary not organized under
the laws of the United States of America or any State thereof or the District of
Columbia.
"Funding Agreement" means the Funding Agreement, dated as of
February 14, 2003, by the Lender in favor of the Senior Lenders and the Agent.
"GAAP" means generally accepted accounting principles in the
United States of America as then in effect on the date hereof, including those
set forth in (i) the opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public Accountants, (ii) statements
and pronouncements of the Financial Accounting Standards Board
- 13 -
and (iii) such other statements by such other entity as approved by a
significant segment of the accounting profession.
"Governmental Authority" means any federal, state, local or
other governmental authority, governmental or regulatory agency or body, court,
arbitrator or self-regulatory organization, domestic or foreign.
"Guarantee" means any obligation, contingent or otherwise, of
any Person directly or indirectly guaranteeing any Indebtedness or other
obligation of any Person and any obligation, direct or indirect, contingent or
otherwise, of such Person (i) to purchase or pay (or advance or supply funds for
the purchase or payment of) such Indebtedness or other obligation of such Person
(whether arising by virtue of partnership arrangements, or by agreements to
keep-well, to purchase assets, goods, securities or services, to take-or-pay or
to maintain financial statement conditions or otherwise) or (ii) entered into
for the purpose of assuring in any other manner the obligee of such Indebtedness
or other obligation of the payment thereof or to protect such obligee against
loss in respect thereof (in whole or in part); provided, however, that the term
"Guarantee" shall not include (x) endorsements for collection or deposit in the
ordinary course of business or (y) guarantees among Restricted Subsidiaries or
guarantees by the Company of Restricted Subsidiaries; provided that the
Indebtedness being guaranteed is permitted to be Incurred. The term "Guarantee"
used as a verb has a corresponding meaning.
"Guaranties" means the guaranties entered into by each of the
Guarantors for the benefit of the Lender pursuant to this Agreement in
substantially the form of the amended and restated guarantee of the subsidiary
Guarantors attached as Exhibit B-1 to this Agreement and the guarantee of the
Company of the MSX Limited Notes attached hereto as Exhibit B-2, as amended,
supplemented or modified from time to time.
"Guarantor" means:
(i) each present and future Domestic Restricted
Subsidiary of the Company required to execute a Guaranty under Section 2.6(b);
(ii) in connection with the guarantee of the MSX
Limited Notes, the Company;
(iii) each "Subsidiary Guarantor" as defined in
the Senior Subordinated Debt Documents, the Senior Secured Debt Documents or any
other guarantor with respect to any Subordinated Debt at any time; and
(iv) any other Person executing a Guaranty at any
time with respect to the Obligations of the Borrowers.
"Hedging Obligations" of any Person mean the obligations of
such Person pursuant to any Interest Rate Agreement or Currency Agreement.
- 14 -
"Incur" means issue, assume, Guarantee, incur or otherwise
become liable for; provided, however, that any Indebtedness of a Person existing
at the time such Person becomes a Subsidiary (whether by merger, consolidation,
acquisition or otherwise) shall be deemed to be Incurred by such Subsidiary at
the time it becomes a Subsidiary; provided, further, however, that in the case
of a discount security, neither the accrual of interest nor the accretion of
original issue discount shall be considered an Incurrence of Indebtedness, but
the entire face amount of such security shall be deemed Incurred upon the
issuance of such security. The term "Incurrence" when used as a noun shall have
a correlative meaning.
"Indebtedness" means, with respect to any Person on any date
of determination (without duplication): (i) the principal of and premium (if
any) in respect of (A) indebtedness of such Person for money borrowed and (B)
indebtedness evidenced by notes, debentures, bonds or other similar instruments
for the payment of which such Person is responsible or liable; (ii) all Capital
Lease Obligations of such Person and all Attributable Debt in respect of
Sale/Leaseback Transactions entered into by such Person; (iii) all obligations
of such Person issued or assumed as the deferred purchase price of property, all
conditional sale obligations of such Person, all obligations of such Person
under any title retention agreement, and any obligation to pay rent or other
payment amounts of such Person with respect to any Sale/Leaseback Transaction
(but excluding trade accounts payable arising in the ordinary course of
business), which purchase price or obligation is due more than six months after
the date of placing such property in service or taking delivery and title
thereto or the completion of such services (provided that, in the case of
obligations of an acquired Person assumed in connection with an acquisition of
such Person, such obligations would constitute Indebtedness of such Person);
(iv) all obligations of such Person for the reimbursement of any obligor on any
letter of credit, banker's acceptance or similar credit transaction (other than
obligations with respect to letters of credit securing obligations (other than
obligations described in (i) through (iii) above) entered into in the ordinary
course of business of such Person to the extent such letters of credit are not
drawn upon or, if and to the extent drawn upon, such drawing is reimbursed no
later than the tenth Business Day following receipt by such Person of a demand
for reimbursement following payment on the letter of credit); (v) the amount of
all obligations of such Person with respect to the redemption, repayment or
other repurchase of any Disqualified Stock or, with respect to any Subsidiary of
such Person, any Preferred Stock (but excluding, in each case, any accrued
dividends); (vi) all obligations of the type referred to in clauses (i) through
(v) of other Persons and all dividends of other Persons for the payment of
which, in either case, such Person is responsible or liable, directly or
indirectly, as obligor, guarantor or otherwise, including by means of any
Guarantee; (vii) all obligations of the type referred to in clauses (i) through
(vi) of other Persons secured by any Lien on any property or asset of such
Person (whether or not such obligation is assumed by such Person), the amount of
such obligation being deemed to be the lesser of the value of such property or
assets or the amount of the obligation so secured; and (viii) to the extent not
otherwise included in this definition, Hedging Obligations of such Person.
The amount of Indebtedness of any Person at any date shall be
the outstanding balance at such date of all unconditional obligations as
described above and the maximum liability, upon the occurrence of the
contingency giving rise to the obligation, of any contingent
- 15 -
obligations as described above at such date; provided, however, that the amount
outstanding at any time of any Indebtedness issued with original issue discount
shall be deemed to be the face amount of such Indebtedness less the remaining
unamortized portion of the original issue discount of such Indebtedness at such
time as determined in conformity with GAAP.
"Indemnitors" has the meaning assigned to it in Section 8.3 of
this Agreement.
"Indenture Security Agreement" means the security agreement
securing the obligations under the Senior Secured Note Indenture, as amended or
modified from time to time.
"Indenture U.K. Deed" means the debenture, dated as of the
date hereof, made by MSX Limited in favor of the Collateral Agent, as amended or
supplemented from time to time in accordance with its terms.
"Intellectual Property" has the meaning assigned to that term
in Section 4.14 of this Agreement.
"Intercreditor Agreement" means the Intercreditor Agreement,
dated as of the date hereof, among the Lender, the Third Lien Lender, the Agent,
the Trustee, the Company, MSX Limited, and the Subsidiary Guarantors (as
applicable) as amended, supplemented or modified from time to time.
"Interest Payment Date" means the first Business Day of each
fiscal quarter of the Company occurring after the Effective Date, commencing
with the first such Business Day occurring after the Effective Date.
"Interest Rate Agreement" means any interest rate swap
agreement, interest rate cap agreement or other financial agreement or
arrangement designed to protect the Company or any Restricted Subsidiary against
fluctuations in interest rates.
"Investment" in any Person means any direct or indirect
advance, loan (other than advances to customers in the ordinary course of
business that are recorded as accounts receivable on the balance sheet of such
Person) or other extensions of credit (including by way of Guarantee or similar
arrangement) or capital contribution to (by means of any transfer of cash or
other property to others or any payment for property or services for the account
or use of others), or any purchase or acquisition of Capital Stock, Indebtedness
or other similar instruments issued by such Person. For purposes of the
definition of "Unrestricted Subsidiary," the definition of "Restricted Payment"
and Section 6.4 (Limitation on Restricted Payments), (i) "Investment" shall
include the portion (proportionate to the Company's equity interest in such
Subsidiary) of the fair market value of the net assets of any Subsidiary of the
Company at the time that such Subsidiary is designated an Unrestricted
Subsidiary; provided, however, that upon a redesignation of such Subsidiary as a
Restricted Subsidiary, the Company shall be deemed to continue to have a
permanent "Investment" in an Unrestricted Subsidiary equal to an amount (if
positive) equal to (x) the Company's "Investment" in such Subsidiary at the time
of such redesignation less (y) the portion (proportionate to the Company's
equity interest in such
- 16 -
Subsidiary) of the fair market value of the net assets of such Subsidiary at the
time of such redesignation; and (ii) any property transferred to or from an
Unrestricted Subsidiary shall be valued at its fair market value at the time of
such transfer, in each case as determined in good faith by the Board of
Directors of the Company.
"Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions are not required to be open in the State of New York or the
State of Illinois.
"Lender" has the meaning assigned to that term in the
introduction to this Agreement and shall include any assignees of the Loans or
Notes pursuant to the terms and conditions of Section 8.1 hereof.
"Lender Obligations" means all "Obligations" as that term is
defined in the Senior Credit Facility.
"Lien" means any mortgage, pledge, security interest,
encumbrance, lien, hypothecation, standard security, assignment by way of
security or charge of any kind (including any conditional sale or other title
retention agreement or lease in the nature thereof).
"Loans" means the loans made by the Lender to the Company and
to MSX Limited pursuant to Section 2.1 hereof.
"Loan Documents" means this Agreement, the Original Agreement,
the Notes, the Security Documents, the Intercreditor Agreement and any other
agreement, instrument or document executed in connection with any of the
foregoing at any time, each as amended, supplemented or modified from time to
time.
"Management Investors" means each of the officers, employees
and directors of the Company who own Voting Stock in the Company on the
Effective Date, in each case so long as such person shall remain an officer,
employee or director of the Company.
"Material Adverse Change" has the meaning assigned to that
term in Section 4.6 to this Agreement.
"Material Adverse Effect" means a material adverse effect on
(i) the properties, business, prospects, operations, earnings, assets,
liabilities or condition (financial or otherwise) of the Company and its
Subsidiaries, taken as a whole, (ii) the ability of the Company to perform its
obligations in all material respects under any Loan Document or (iii) the
validity of any of the Loan Documents or the consummation of any of the
transactions contemplated therein.
"Maturity Date" means the earlier of (i) January 15, 2008 and
(ii) the earlier of (x) six months after the latest stated maturity under the
Senior Credit Facility or (y) the date the loans and advances under the Senior
Credit Facility, or the Senior Secured Notes under the Senior Secured Note
Indenture, become due and payable by acceleration or otherwise or are paid in
full.
- 17 -
"Mortgages" means the mortgages, deeds of trust, deeds to
secure Indebtedness or other similar documents creating Liens in favor of the
Lender upon the owned real property constituting Collateral of the Company or
any of its Domestic Restricted Subsidiaries from time to time.
"MSX Registration Rights Agreement" means the amended and
restated registration rights agreement dated November 28, 2000 by and among the
Company, CVC and certain CVC Investors and executive officers and directors of
the Company, as amended from time to time.
"MSX Limited" means MSX International Limited, a company
incorporated under the laws of England and Wales, together with its permitted
successors and assigns.
"MSX Limited Notes" means one or more of the notes of MSX
Limited issued pursuant to the terms and conditions of Sections 2.1 or 8.1
hereof, substantially in the form of Exhibit A-2 to this Agreement.
"Net Available Cash" from an Asset Disposition (or, for
purposes of Article II hereof, any other sale or disposition of assets) means
cash payments received by the Company or any of its Subsidiaries therefrom
(including any cash payments received by way of deferred payment of principal
pursuant to a note or installment receivable or otherwise, but only as and when
received, but excluding any other consideration received in the form of
assumption by the acquiring Person of Indebtedness or other obligations relating
to such properties or assets or received in any other non-cash form) in each
case net of
(i) all legal, title and recording tax expenses,
commissions and other fees and expenses incurred, and all Federal, state,
provincial, foreign and local taxes required to be paid or accrued as a
liability under GAAP, as a consequence of such Asset Disposition (or, for
purposes of Article II hereof, any other sale or disposition of assets),
(ii) all payments made on any Indebtedness which is
secured by any assets subject to such Asset Disposition (or, for purposes of
Article II hereof, any other sale or disposition of assets), in accordance with
the terms of any Lien upon or other security agreement of any kind with respect
to such assets, or which must by its terms, or in order to obtain a necessary
consent to such Asset Disposition, or by applicable law, be repaid out of the
proceeds from such Asset Disposition,
(iii) all distributions and other payments required to be
made to minority interest holders in Subsidiaries or joint ventures as a result
of such Asset Disposition (or, for purposes of Article II hereof, any other sale
or disposition of assets) and
(iv) the deduction of appropriate amounts provided by the
seller as a reserve, in accordance with GAAP, against any liabilities associated
with the property or other assets disposed in such Asset Disposition (or, for
purposes of Article II hereof, any other sale or disposition of assets) and
retained by the Company or any Restricted Subsidiary after such Asset
- 18 -
Disposition, including without limitation liabilities under any indemnification
obligations associated with such Asset Disposition.
"Net Cash Proceeds" means with respect to any issuance or sale
of Capital Stock or debt securities or instruments or the incurrence of loans,
means the cash proceeds of such issuance, sale or incurrence net of attorneys'
fees, accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees and expenses actually
incurred in connection with such issuance, sale or incurrence and net of taxes
paid or payable as a result thereof.
"Notes" mean the Company Notes and the MSX Limited Notes.
"Obligations" means all obligations of every nature of the
Company and MSX Limited, as applicable, from time to time owed to the Lender
under the Loan Documents.
"Officer" means the Chief Executive Officer, the President,
the Chief Financial Officer or any Vice President of the Company or MSX Limited,
as applicable, or any director in the case of MSX Limited.
"Officers' Certificate" means a certificate signed by two
Officers of the Company, at least one of whom shall be the principal financial
officer of the Company.
"Original Agreement" has the meaning assigned to that term in
the introduction to this Agreement.
"Original Effective Date" means July 31, 2002.
"Pari Passu Indebtedness" means any unsubordinated
Indebtedness of the Company (other than any Indebtedness owed to any Subsidiary
of the Company).
"Permitted Foreign Transaction" means a transaction in which
one or more Foreign Subsidiaries acquire Capital Stock or Indebtedness of a
Person in connection with any sale, lease, transfer, contribution or other
disposition, including any disposition by merger, consolidation or similar
transaction (each referred to for the purposes of this definition as a
"disposition"), of (i) any shares of Capital Stock of a Foreign Subsidiary or a
group of Foreign Subsidiaries, or (ii) all or substantially all of the assets of
any division, business segment or comparable line of business of any Foreign
Subsidiary or group of Foreign Subsidiaries; provided that EBITDA for the period
of the most recent four consecutive fiscal quarters ending at least 45 days
prior to the date of the disposition (treated as a single accounting period),
after giving pro forma effect thereto as if such disposition occurred on the
first day of such period, is greater than EBITDA for the same period without
giving pro forma effect to such disposition.
"Permitted Holders" means the CVC Investors, the Management
Investors and their respective Permitted Transferees, and in addition, in the
case of MSX Limited, the Company or any of its Subsidiaries; provided, however,
that any Management Investor and any CVC Investor
- 19 -
and any Permitted Transferee of a Management Investor or CVC Investor (other
than CVC or Citigroup Inc. or any direct or indirect Subsidiary of CVC or
Citigroup Inc. or any other Person controlled by CVC or Citigroup Inc.) shall
not be a "Permitted Holder" if such Person is the "beneficial owner" (as defined
in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of
Voting Stock that represents at least 30% of the aggregate voting power of all
classes of the Voting Stock of the Company, voting together as a single class
(without giving effect to the attribution of beneficial ownership as a result of
any stockholders' agreement as in effect on the Effective Date, and any
amendment to such agreement that does not materially change the allocation of
voting power provided in such agreement).
"Permitted Investment" means an Investment in: (i) the Company
or, to the extent used to make any redemption, repurchase or other retirement
for value or payment on the U.K. Senior Secured Notes, in MSX Limited; (ii) any
Person that is or will become immediately after such Investment a Guarantor or
that will merge or consolidate with or into the Company or a Guarantor, or
transfers or conveys all or substantially all of its assets to the Company or a
Guarantor; provided, however, that the primary business of such Person is a
Related Business; (iii) any Foreign Restricted Subsidiary of the Company by any
other Foreign Restricted Subsidiary of the Company; (iv) any Foreign Restricted
Subsidiary of the Company by the Company or any Domestic Restricted Subsidiary
of the Company in an aggregate amount not to exceed (x) $2.0 million in any
fiscal year and (y) the aggregate amount of Investments permitted by this clause
(iv) and not used by the Company in the immediately preceding fiscal year (after
giving effect to any amounts permitted pursuant to this clause (y) in the
immediately preceding year); (v) Temporary Cash Investments; (vi) receivables
owing to the Company or any Restricted Subsidiary if created or acquired in the
ordinary course of business and payable or dischargeable in accordance with
customary trade terms; provided, however, that such trade terms may include such
concessionary trade terms as the Company or any such Restricted Subsidiary deems
reasonable under the circumstances; (vii) payroll, travel and similar advances
to cover matters that are expected at the time of such advances ultimately to be
treated as expenses for accounting purposes and that are made in the ordinary
course of business; (viii) loans or advances to employees of the Company or a
Restricted Subsidiary in an aggregate amount not to exceed $1.5 million; (ix)
stock, obligations or securities received in settlement of debts created in the
ordinary course of business and owing to the Company or any Restricted
Subsidiary or in satisfaction of judgments; (x) Persons received in connection
with a Permitted Foreign Transaction; (xi) any Person to the extent such
Investment represents the non-cash portion of the consideration received for an
Asset Disposition as permitted pursuant to Section 6.3 (Limitation on Sales of
Assets and Subsidiary Stock); and (xii) additional Investments not to exceed
$5.0 million at any time outstanding.
"Permitted Liens" means:
(1) Liens for taxes, assessments or governmental charges
or claims either (a) not delinquent or (b) contested in good faith by
appropriate proceedings and as to which the Company or its Restricted
Subsidiaries shall have set aside on its books such reserves as may be required
pursuant to GAAP;
- 20 -
(2) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen and other Liens
imposed by law or pursuant to customary reservations or retentions of title
incurred in the ordinary course of business for sums not yet delinquent or being
contested in good faith, if such reserve or other appropriate provision, if any,
as shall be required by GAAP shall have been made in respect thereof;
(3) Liens incurred or deposits made in the ordinary
course of business in connection with workers' compensation, unemployment
insurance and other types of social security, including any Lien securing
letters of credit issued in the ordinary course of business consistent with past
practice in connection therewith, or to secure the performance of tenders,
statutory obligations, surety and appeal bonds, bids, leases, government
contracts, performance and return-of-money bonds and other similar obligations
(exclusive of obligations for the payment of borrowed money);
(4) judgment Liens not giving rise to an Event of Default
so long as such Lien is adequately bonded and any appropriate legal proceedings
which may have been duly initiated for the review of such judgment shall not
have been finally terminated or the period within which such proceedings may be
initiated shall not have expired;
(5) easements, rights-of-way, zoning restrictions and
other similar charges or encumbrances in respect of real property not
interfering in any material respect with the ordinary conduct of the business of
the Company or any of its Restricted Subsidiaries;
(6) any interest or title of a lessor under any
Capitalized Lease Obligation permitted pursuant to clause (b)(8) of Section 6.1
(Limitation on Incurrence of Indebtedness); provided that such Liens do not
extend to any property or assets which is not leased property subject to such
Capitalized Lease Obligation;
(7) Liens securing Capitalized Lease Obligations and
Purchase Money Indebtedness permitted pursuant to clause (b)(8) of Section 6.1
(Limitation on Incurrence of Indebtedness); provided, however, that in the case
of Purchase Money Indebtedness (a) the Indebtedness shall not exceed the cost of
the real property acquired, together with the cost of the construction thereof
and improvements thereto, and shall not be secured by any property or assets of
the Company or any Restricted Subsidiary of the Company other than such property
and improvements thereto so acquired or constructed and (b) the Lien securing
such Indebtedness shall be created within 180 days of such acquisition or
construction or, in the case of a refinancing of any Purchase Money
Indebtedness, within 180 days of such refinancing;
(8) Liens upon specific items of inventory or other goods
and proceeds of any Person securing such Person's obligations in respect of
bankers' acceptances issued or created for the account of such Person to
facilitate the purchase, shipment or storage of such inventory or other goods;
(9) Liens securing indebtedness permitted under clause
(b)(9) of Section 6.1 (Limitation on Incurrence of Indebtedness);
- 21 -
(10) Liens encumbering deposits made to secure obligations
arising from statutory, regulatory, contractual, or warranty requirements of the
Company or any of its Restricted Subsidiaries, including rights of offset and
set-off;
(11) Liens securing Hedging Obligations permitted pursuant
to clause (b)(7) of Section 6.1 (Limitation on Incurrence of Indebtedness);
(12) Liens securing Acquired Indebtedness incurred in
accordance with Section 6.1 (Limitation on Incurrence of Indebtedness); provided
that:
(a) such Liens secured such Acquired Indebtedness at the
time of and prior to the incurrence of such Acquired Indebtedness by the Company
or a Restricted Subsidiary of the Company and were not granted in connection
with, or in anticipation of, the incurrence of such Acquired Indebtedness by the
Company or a Restricted Subsidiary of the Company; and
(b) such Liens do not extend to or cover any property or
assets of the Company or of any of its Restricted Subsidiaries other than the
property or assets that secured the Acquired Indebtedness prior to the time such
Indebtedness became Acquired Indebtedness of the Company or a Restricted
Subsidiary of the Company and are no more favorable to the lienholders than
those securing the Acquired Indebtedness prior to the incurrence of such
Acquired Indebtedness by the Company or a Restricted Subsidiary of the Company;
(13) Liens existing as of the Effective Date and securing
Indebtedness permitted to be outstanding under clause (b)(3) of Section 6.1
(Limitation on Incurrence of Indebtedness) to the extent and in the manner such
Liens are in effect on the Effective Date;
(14) Liens securing the Senior Secured Notes, all monetary
obligations under the Senior Secured Note Indenture and the Guarantees
thereunder;
(15) Liens securing Indebtedness under the Senior Credit
Facility to the extent such Indebtedness is permitted under clause (b)(1) of
Section 6.1 (Limitation on Incurrence of Indebtedness);
(16) Liens of the Company or a Wholly-Owned Subsidiary of
the Company on assets of any Restricted Subsidiary of the Company;
(17) Liens securing Refinancing Indebtedness which is
incurred to Refinance any Indebtedness which has been secured by a Lien
permitted under this paragraph and which has been incurred in accordance with
Section 6.1 (Limitation on Incurrence of Indebtedness); provided, however, that
such Liens: (i) are no less favorable to the holders of Senior Secured Notes and
are not more favorable to the lienholders with respect to such Liens than the
Liens in respect of the Indebtedness being Refinanced; and (ii) do not extend to
or cover any property or assets of the Company or any of its Restricted
Subsidiaries not securing the Indebtedness so Refinanced;
- 22 -
(18) Liens in favor of custom and revenue authorities;
(19) Liens securing Cash Management Obligations;
(20) Liens securing Indebtedness permitted under clause
(b)(13) of Section 6.1 (Limitation on Incurrence of Indebtedness); and
(21) Liens securing Indebtedness of Foreign Restricted
Subsidiaries to the extent such Indebtedness is permitted under clause (b)(12)
of Section 6.1 (Limitation on Incurrence of Indebtedness) (provided, however,
that no asset of the Company or any Domestic Restricted Subsidiary shall be
subject to any such Lien).
"Permitted Securitization Transaction" means any transaction
or series of transactions pursuant to which Company or any of its Subsidiaries
may sell, convey, or otherwise transfer to a Securitization Entity (in the case
of a transfer by Company or any of its Subsidiaries) or any other Person (in
case of a transfer by a Securitization Entity), or may grant a security interest
in, any accounts receivable (whether now existing or arising or acquired in the
future) of Company or any of its Subsidiaries, and any assets related thereto
including, without limitation, all collateral securing such accounts receivable,
all contracts and contract rights and all guarantees or other obligations in
respect to such accounts receivable, proceeds of such accounts receivable and
other assets (including contract rights) which are customarily transferred or in
respect of which security interests are customarily granted in connection with
asset securitization transactions involving accounts receivable, provided (i)
the aggregate Indebtedness with respect to all such transactions shall not
exceed the amount permitted under this Agreement and (ii) the terms and
conditions of such transactions are reasonably acceptable to the Lender.
"Permitted Transferee" means (a) with respect to any CVC
Investor who is an employee, officer or director of CVC, the Third Lien Lender
or any Wholly Owned Subsidiary of CVC or the Third Lien Lender, any spouse or
lineal descendant (including by adoption) of such CVC Investor so long as such
CVC Investor shall be an employee, officer or director of CVC or the Third Lien
Lender; and (b) with respect to any Management Investor, any spouse or lineal
descendant (including by adoption) of such Management Investor so long as such
Management Investor shall be an employee, officer or director of the Company.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
government or any agency or political subdivision thereof or any other entity.
"Pledge Agreements" mean each amended and restated Pledge
Agreement entered into by the Company or any of its Subsidiaries for the benefit
of the Lender pursuant to this Agreement substantially in the forms attached to
this Agreement as Exhibits C-1 and C-2, as amended, supplemented or modified
from time to time, and as will be entered into pursuant to the terms hereof, as
amended, supplemented or modified from time to time.
- 23 -
"Preferred Stock" as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however designated)
which is preferred as to the payment of dividends, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"Preliminary Offering Circular" means the preliminary offering
circular of the Company, dated July 7, 2003, prepared in connection with the
offering of the Senior Secured Notes.
"Premises" has the meaning assigned to that term in Section
5.3 of this Agreement.
"Proceedings" has the meaning assigned to that term in Section
4.5 of this Agreement.
"Public Equity Offering" means an underwritten primary public
offering of common stock of the Company pursuant to an effective registration
statement under the Securities Act.
"Public Market" means any time after (i) a Public Equity
Offering has been consummated and (ii) at least 10% of the total issued and
outstanding common stock of the Company has been distributed by means of an
effective registration statement under the Securities Act or sales pursuant to
Rule 144 under the Securities Act.
"Purchase Money Indebtedness" mean Indebtedness (i) consisting
of the deferred purchase price of property, conditional sale obligations,
obligations under any title retention agreement, other purchase money
obligations and obligations in respect of industrial revenue bonds or similar
Indebtedness, in each case where the maturity of such Indebtedness does not
exceed the anticipated useful life of the asset being financed, and (ii)
Incurred to finance the acquisition by the Company or a Restricted Subsidiary of
such asset, including additions and improvements; provided, however, that any
Lien arising in connection with any such Indebtedness shall be limited to the
specified asset being financed or, in the case of real property or fixtures,
including additions and improvements, the real property on which such asset is
attached; and provided, further, however, that such Indebtedness is Incurred
within 180 days after such acquisition of such asset by the Company or
Restricted Subsidiary.
"Qualified Finance Subsidiary" means a Subsidiary of the
Company constituting a "finance subsidiary" within the meaning of Rule 3a-5
under the Investment Company Act of 1940, as amended (the "1940 Act"), or an
issuer of asset-backed securities within the meaning of Rule 3a-7 of the 1940
Act or any other vehicle under a similar exemption, formed for the purpose of
engaging in a Qualified TIPS Transaction and having no assets other than those
necessary to consummate the Qualified TIPS Transaction.
- 24 -
"Qualified TIPS Transaction" means an issuance by a Qualified
Finance Subsidiary of preferred trust securities or similar securities in
respect of which any dividends, liquidation preference or other obligations
under such securities are Guaranteed by the Company to the extent required by
the 1940 Act, as amended, or customary for transactions of such type.
"Refinance" means, in respect of any Indebtedness, to
refinance, extend, renew, refund, repay, prepay, redeem, defease or retire, or
to issue other Indebtedness in exchange or replacement for, such Indebtedness.
"Refinanced" and "Refinancing" shall have correlative meanings.
"Refinancing Indebtedness" means Indebtedness that Refinances
any Indebtedness of the Company or any Restricted Subsidiary existing on the
Effective Date or Incurred in compliance with the Senior Secured Note Indenture;
provided, however, that (i) such Refinancing Indebtedness has a Stated Maturity
no earlier than the Stated Maturity of the Indebtedness being Refinanced, (ii)
such Refinancing Indebtedness has an Average Life at the time such Refinancing
Indebtedness is Incurred that is equal to or greater than the Average Life of
the Indebtedness being Refinanced and (iii) such Refinancing Indebtedness has an
aggregate principal amount (or if Incurred with original issue discount, an
aggregate issue price) that is equal to or less than the aggregate principal
amount (or if Incurred with original issue discount, the aggregate accreted
value) then outstanding or committed (plus fees and expenses, including any
premium and defeasance costs) under the Indebtedness being Refinanced; provided,
further, however, that Refinancing Indebtedness shall not include Indebtedness
of the Company or a Restricted Subsidiary that Refinances Indebtedness of an
Unrestricted Subsidiary.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the Effective Date, between the Company, MSX Limited, the
Guarantors and Xxxxxxxxx & Company, Inc., as the same may be amended or modified
from time to time in accordance with the terms thereof.
"Related Business" means any business related, ancillary or
complementary (as determined in good faith by the Board of Directors of the
Company) to the businesses of the Company and the Restricted Subsidiaries on the
Effective Date.
"Restated Senior Credit Agreement" has the meaning assigned to
that term in the introduction to this Agreement.
"Restricted Payment" means, with respect to any Person, (i)
the declaration or payment of any dividends or any other distributions on or in
respect of its Capital Stock (including any such payment in connection with any
merger or consolidation involving such Person) or similar payment to the holders
of its Capital Stock, except dividends or distributions payable solely in its
Capital Stock (other than Disqualified Stock) and except dividends or
distributions payable solely to the Company or a Restricted Subsidiary (and, if
such Restricted Subsidiary is not wholly owned, to its other shareholders on a
pro rata basis or on a basis that results in the receipt by the Company or a
Restricted Subsidiary of dividends or distributions of greater value than it
would receive on a pro rata basis), (ii) the purchase, redemption or other
- 25 -
acquisition or retirement for value of any Capital Stock of the Company held by
any Person or of any Capital Stock of a Restricted Subsidiary held by any
Affiliate of the Company (other than a Restricted Subsidiary), including the
exercise of any option to exchange any Capital Stock (other than into Capital
Stock of the Company that is not Disqualified Stock), (iii) the purchase,
repurchase, redemption, defeasance or other acquisition or retirement for value,
prior to scheduled maturity, scheduled repayment or scheduled sinking fund
payment of any Subordinated Obligations (other than the purchase, repurchase or
other acquisition of Subordinated Obligations purchased in anticipation of
satisfying a sinking fund obligation, principal installment or final maturity,
in each case due within one year of the date of acquisition) or (iv) the making
of any Investment in any Person (other than a Permitted Investment).
"Restricted Subsidiary" means any Subsidiary of the Company
that is not an Unrestricted Subsidiary under the Senior Secured Note Indenture.
"Sale/Leaseback Transaction" means an arrangement relating to
property now owned or hereafter acquired whereby the Company or a Restricted
Subsidiary transfers such property to a Person and the Company or a Restricted
Subsidiary leases it from such Person and such lease is reflected on such
Person's balance sheet as a Capital Lease Obligation.
"SEC" means the Securities and Exchange Commission.
"Securitization Entity" means a wholly-owned Subsidiary that
engages in no activities other than Permitted Securitization Transactions and
any necessary related activities and that is designated by the Board of
Directors of the Company as a Securitization Entity, (i) no portion of the
Indebtedness (contingent or otherwise) of which (a) is guaranteed by Company or
any Subsidiary of the Company, (b) is recourse to or obligates Company or any
Subsidiary of Company in any way, other than pursuant to customary
representations, warranties, covenants and indemnities entered into in
connection with a Permitted Securitization Transaction, and (ii) to which
neither Company nor any Subsidiary of Company has any obligation to maintain or
preserve such entity's financial condition or cause such entity to achieve
certain levels of operating results.
"Security Agreements" mean each amended and restated Security
Agreement entered into by the Company or any Guarantor for the benefit of the
Lender pursuant to this Agreement substantially in the forms attached to this
Agreement as Exhibits D-1 and D-2, and the U.K. Deed, as each are amended,
supplemented or modified from time to time, and any other agreement executed by
MSX Limited, the Company or any of its Subsidiaries granting a Lien for the
benefit of the Lender in form or substance satisfactory to the Lender, as
amended, supplemented or modified from time to time.
"Security Documents" mean the Pledge Agreements, the Security
Agreements, the Guaranties, the Intercreditor Agreement and all other agreements
and documents delivered pursuant to this Agreement or the Original Agreement or
otherwise entered into by any Person to secure or guaranty the obligations of
the Company under this Agreement.
- 26 -
"Senior Credit Facility" means the Restated Senior Credit
Agreement, as the same may be amended, extended, renewed, restated, supplemented
or otherwise modified (in each case, in whole or in part, and without limitation
as to amount, terms, conditions, covenants and other provisions) from time to
time, and any agreement governing Indebtedness Incurred to refund, replace or
refinance any borrowings and commitments then outstanding or permitted to be
outstanding under such Senior Credit Facility or any such prior agreement as the
same may be amended, extended, renewed, restated, supplemented or otherwise
modified (in each case, in whole or in part, and without limitation as to
amount, terms, conditions, covenants and other provisions). The term "Senior
Credit Facility" shall include all related or ancillary documents executed at
any time, including, without limitation, any instruments, guarantee agreements
and security documents. All Cash Management Obligations owing by the Company or
any of its Subsidiaries to the Agent, any Senior Lender or their respective
Affiliates shall also be deemed obligations under the Senior Credit Facility.
"Senior Debt Documents" means, collectively, the Senior Credit
Facility, and all "Loan Documents" (as defined in the Senior Credit Facility).
"Senior Lenders" has the meaning assigned to that term in the
introduction to this Agreement, and shall include any lenders from time to time
under the Senior Credit Facility.
"Senior Secured Note Guarantees" means the Subsidiary
Guarantees and the Company Guarantee.
"Senior Secured Note Indenture" has the meaning assigned to
that term in the introduction to this Agreement.
"Senior Secured Notes" means the 11% Senior Secured Notes
issued by the Company and MSX Limited in the aggregate principal amount of
$75,500,000 due 2007 issued pursuant to the Senior Secured Note Indenture, and
any other securities issued pursuant to the Senior Secured Note Indenture at any
time, including the Exchange Notes.
"Senior Secured Debt Documents" means the Senior Secured Note
Indenture, the Senior Secured Notes and all agreements and documents executed in
connection therewith at any time.
"Senior Subordinated Debt Documents" means the Senior
Subordinated Note Indenture, the Senior Subordinated Notes and all agreements
and documents executed in connection therewith at any time.
"Senior Subordinated Notes " means the 11-3/8% Senior
Subordinated Notes issued by the Company in the aggregate principal amount of
$130,000,000 due 2008 issued pursuant to the Senior Subordinated Note Indenture
and any other securities issued pursuant to the Senior Subordinated Note
Indenture at any time.
- 27 -
"Senior Subordinated Note Indenture" means the Senior
Subordinated Indenture between the Company, the subsidiary guarantors named
therein and Bank of New York (as successor trustee to IBJ Xxxxxxxx Bank & Trust
Company), as trustee, dated as of January 15, 1998, as amended or modified from
time to time.
"Significant Subsidiary" means any Restricted Subsidiary that
would be a "Significant Subsidiary" of the Company within the meaning of Rule
1-02 under Regulation S-X promulgated by the SEC.
"Stated Maturity" means, with respect to any security, the
date specified in such security as the fixed date on which the final payment of
principal of such security is due and payable, including pursuant to any
mandatory redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the
happening of any contingency unless such contingency has occurred).
"Stockholders' Agreement" means the amended and restated
stockholders' agreement dated November 28, 2000 by and among the Company, CVC,
and certain CVC Investors, the Third Lien Lender and executive officers and
directors of the Company, as amended by Amendment No. 1 dated January 31, 2003
and Amendment No. 2 dated as of August 1, 2003, and as amended from time to
time.
"Subordinated Debt" means, in the case of the Company, all
Indebtedness owing pursuant to the Senior Subordinated Notes and any extensions,
refinancings, renewals or refundings thereof and any increases in the amount
thereof and, for any Person, any other Indebtedness of such Person which is
fully subordinated to all Lender Obligations, the Senior Secured Notes, the
Third Lien Notes and the Notes by written agreements and documents in form and
substance satisfactory to the Agent and the Trustee and which is governed by
terms and provisions, including without limitation maturities, covenants,
defaults, rates and fees, acceptable to the Agent and Trustee.
"Subordinated Debt Documents" means the Senior Subordinated
Debt Documents and any other agreement or document evidencing or relating to any
Subordinated Debt, whether under the Senior Subordinated Notes or any other
Subordinated Debt.
"Subordinated Obligations" means any Indebtedness of the
Company (whether outstanding on the Effective Date or thereafter Incurred) which
is subordinate or junior in right of payment to the Lender Obligations, the
Senior Secured Notes, the Third Lien Notes and the Notes pursuant to a written
agreement to that effect. "Subordinated Obligation" of any Guarantor has a
correlative meaning.
"Subsidiary" means, in respect of any Person, any corporation,
association, partnership, business trust or other business entity of which more
than 50% of the total voting power of shares of Capital Stock or other interests
(including partnership interests or trust interests) entitled (without regard to
the occurrence of any contingency) to vote in the election of directors,
managers or trustees thereof is at the time owned or controlled, directly or
indirectly,
- 28 -
by (i) such Person, (ii) such Person and one or more Subsidiaries of such Person
or (iii) one or more Subsidiaries of such Person.
"Subsidiary Guarantee" means the Guarantee by a subsidiary
Guarantor of the Company's and MSX Limited's obligations with respect to the
Senior Secured Notes.
"Successor Company" has the meaning assigned to it in Section
6.9 of this Agreement.
"Tax" has the meaning assigned to that term in Section 4.8 of
this Agreement.
"Temporary Cash Investments" means any of the following: (i)
any investment in direct obligations of the United States of America or any
agency thereof or obligations Guaranteed by the United States of America or any
agency thereof, (ii) investments in time deposit accounts, certificates of
deposit and money market deposits maturing within 180 days of the date of
acquisition thereof issued by a bank or trust company which is organized under
the laws of the United States of America, any state thereof or any foreign
country recognized by the United States, and which bank or trust company has
capital, surplus and undivided profits aggregating in excess of $250,000,000 (or
the foreign currency equivalent thereof) and has outstanding debt which is rated
"A" (or such similar equivalent rating) or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under the
Securities Act) or any money-market fund sponsored by a registered broker dealer
or mutual fund distributor, (iii) repurchase obligations with a term of not more
than 30 days for underlying securities of the types described in clause (i)
above entered into with a bank meeting the qualifications described in clause
(ii) above, (iv) investments in commercial paper, maturing not more than 90 days
after the date of acquisition, issued by a corporation (other than an Affiliate
of the Company) organized and in existence under the laws of the United States
of America, any State thereof or the District of Columbia or any foreign country
recognized by the United States of America with a rating at the time as of which
any investment therein is made of "P-1" (or higher) according to Xxxxx'x
Investors Service, Inc. or "A-1" (or higher) according to Standard and Poor's
Ratings Group, and (v) investments in securities with maturities of six months
or less from the date of acquisition issued or fully Guaranteed by any state,
commonwealth or territory of the United States of America, or by any political
subdivision or taxing authority thereof, and rated at least "A" by Standard &
Poor's Ratings Group or "A" by Xxxxx'x Investors Service, Inc.
"Third Lien Lender" means Citicorp Mezzanine III, L.P. and its
assigns under the Third Lien Loan Agreement.
"Third Lien Loan Agreement" means the Third Secured Term Loan
Agreement of even date herewith by and among the Company, MSX Limited and the
Third Lien Lender, as amended or modified from time to time.
"Third Lien Notes" means the notes issued by the Company and
MSX Limited to the Third Lien Lender, as amended or modified from time to time.
- 29 -
"Trustee" means the trustee under the Senior Secured Note
Indenture, initially BNY Midwest Trust Company.
"U.K. Deed" means the debenture, dated as of the date hereof,
made by MSX Limited in favor of the Lender, substantially in the form attached
to this Agreement as Exhibit D-3, as amended or supplemented from time to time
in accordance with its terms.
"U.K. Senior Secured Notes" means the Senior Secured Notes
issued by MSX Limited.
"Unit" means a unit consisting of $860 principal amount of
U.S. Senior Secured Notes and $140 principal amount of U.K. Senior Secured
Notes.
"Unrestricted Subsidiary" means (i) any Subsidiary of the
Company that at the time of determination shall be designated an Unrestricted
Subsidiary by the Board of Directors of the Company in the manner provided above
under Section 5.4 (Designation of Restricted and Unrestricted Subsidiaries) and
(ii) any Subsidiary of an Unrestricted Subsidiary.
"U.S. Senior Secured Notes" means the Senior Secured Notes
issued by the Company.
"Voting Stock" of a Person means all classes of Capital Stock
or other interests (including partnership interests) of such Person then
outstanding and normally entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof.
"WARN" has the meaning set forth in Section 4.15 of this
Agreement.
"Withholding Taxes" has the meaning set forth in Section
2.2(e) of this Agreement.
"Wholly Owned Subsidiary" means a Restricted Subsidiary all
the Capital Stock of which (other than directors' qualifying shares) is owned by
the Company and/or one or more Wholly Owned Subsidiaries.
SECTION 1.2. Other Definitions; Rules of Construction. As
used herein, the terms "Company," "Lender" and the "Agreement" shall have the
respective meanings ascribed thereto in the introductory paragraph of this
Agreement. Such terms, together with the other defined terms in Section 1.1
shall include both the singular and the plural forms thereof and shall be
construed accordingly. Use of the terms "herein", "hereof", and "hereunder"
shall be deemed references to this Agreement in its entirety and not to the
Section or clause in which such term appears. References to "Sections" and
"subsections" shall be to Sections and subsections, respectively, of this
Agreement unless otherwise specifically provided. Use of the term "including"
shall mean including without limitation.
- 30 -
SECTION 1.3. Accounting Terms and Determinations. For
purposes of this Agreement, unless otherwise specified, all accounting terms
used herein or in any other Loan Document shall be interpreted, all accounting
determinations and computations hereunder or thereunder shall be made, and all
financial statements required to be delivered hereunder or thereunder shall be
prepared in accordance with GAAP.
ARTICLE 2 AMOUNT AND TERMS OF NOTES AND LOANS; EXCHANGE
SECTION 2.1. Loans and Notes.
(a) Exchange of Loans and Notes. Subject to the
terms and conditions of the Original Agreement and in reliance upon the
representations and warranties of the Company therein set forth, the Lender has
provided a loan to the Company on the Original Effective Date in an amount equal
to $15,450,000. On the Original Effective Date, the Company executed and
delivered to the Lender the note (the "Original Note") dated as of the Original
Effective Date, to evidence the Loan made on such date, in the aggregate
principal amount of $15,450,000 (which amount, together with accrued interest
through the date hereof, is equal to $17,084,162.13). Lender represents and
warrants to the Borrowers that as of the date hereof it owns the Original Note
free and clear of all Liens and has not assigned, pledged, transferred or
encumbered in any manner its interest in the Original Note. Subject to the terms
and conditions of this Agreement and in reliance upon the representations and
warranties of the Borrowers herein set forth, on the Effective Date Lender (1)
consents to the amendment and restatement of the Original Agreement, the
issuance of the Third Lien Notes and Senior Secured Notes and the execution,
delivery and performance of the Senior Secured Note Indenture and the Third Lien
Loan Agreement and (2) tenders and exchanges the Original Note and all accrued
interest thereon (including any notes issued in respect of such accrued
interest) for (i) an amended and restated Company Note, dated the date hereof,
in the aggregate principal amount of $14,692,379.43, evidencing the Loan made by
the Lender to the Company and (ii) the MSX Limited Note, dated the date hereof,
in the aggregate principal amount of $2,391,782.70, evidencing the Loan made by
the Lender to MSX Limited. On the Effective Date and upon completion of the
foregoing exchange, the Original Note shall be cancelled.
(b) Payment of Loan. The unpaid principal amount
of the Loans plus all accrued and unpaid interest thereon and all other amounts
owed hereunder with respect thereto shall be paid in full in Cash on the
Maturity Date.
SECTION 2.2. Interest on the Loan; Tax Amounts.
(a) Rate of Interest. Except as provided in
Section 2.2(c) below, the Loans shall bear interest on the unpaid principal
amount thereof from the date made through maturity (whether at stated maturity,
by acceleration or otherwise) at a rate equal to 10.00% per annum.
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(b) Interest Payments.
(i) Interest shall be payable with
respect to the Loans, in arrears on and to each Interest Payment Date, and upon
any prepayment of the Loans (to the extent of accrued interest on the principal
amount of the Loan so prepaid) and at maturity of the Loan.
(ii) On any Interest Payment Date after
the Effective Date that the Lender Obligations have not been indefeasibly paid
in full, the Commitments have not been terminated or the Senior Secured Notes or
Third Lien Notes have not been indefeasibly paid in full ("Accrual Interest
Dates"), each of the Company and MSX Limited shall accrue the unpaid accrued
interest with respect to its Loan due on any Accrual Interest Date by adding
such unpaid accrued interest to the then outstanding principal amount of the
Loan.
(c) Default Interest. Upon the occurrence and
during the continuance of an Event of Default and, to the extent permitted by
applicable law, the Loans and Notes shall bear interest payable upon demand at a
rate which is 2.00% per annum in excess of the rate of interest otherwise
payable under this Agreement for the Loans; provided that if the Lender
Obligations have not been indefeasibly paid in full, the Commitments have not
been terminated and the Senior Secured Notes and the Third Lien Notes have not
been indefeasibly paid in full, each Borrower shall pay such accrued interest by
adding such unpaid accrued interest to the then outstanding principal amount of
its Loan.
(d) Computation of Interest. Interest on the
Loans shall be computed on the basis of a 360-day year. In computing such
interest, the date or dates of the making of the Loan shall be included and the
date of payment shall be excluded.
(e) Tax Amounts. All payments by MSX Limited and
any Guarantor in respect of the MSX Limited Notes shall be made without
withholding or deduction for or on account of any present or future taxes,
duties, assessments or other governmental charges of whatsoever nature,
including penalties, interest and any other liabilities related thereto
("Withholding Taxes"), imposed or levied by or on behalf of the United Kingdom
or any relevant jurisdiction or any political subdivision or authority thereof
or therein having power to tax, unless MSX Limited is compelled by law to deduct
or withhold such Withholding Taxes. In such event, MSX Limited or such Guarantor
shall pay such additional amounts ("Additional Tax Amounts") as may be necessary
to ensure that the net amounts received by the Lender after such withholding or
deduction shall equal the amounts of such payments that would have been
receivable in respect of the MSX Limited Notes in the absence of such
withholding or deduction. MSX Limited and any Guarantor will also (a) make such
withholding or deduction compelled by applicable law and (b) remit the full
amount deducted or withheld to the relevant authority in accordance with
applicable law. MSX Limited and any Guarantor will furnish copies of such
receipts evidencing the payment of any Withholding Taxes so deducted or withheld
in such form as provided in the normal course by the taxing authority imposing
such Withholding Taxes and as is reasonably available to MSX Limited or the
Guarantors within 60 days after the date of receipt of such evidence.
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All references herein and in the MSX Limited Notes to the principal of or
interest on a MSX Limited Note shall be deemed to include any Additional Tax
Amounts payable in connection therewith. MSX Limited will pay any present or
future stamp, court or documentary taxes or any other excise or property taxes,
charges or similar levies that arise in any jurisdiction from the execution,
delivery or registration of the MSX Limited Notes or any other document or
instrument referred to in this Agreement.
MSX Limited Notes may be redeemed, at the option of MSX Limited, as a whole, but
not in part (limited to MSX Limited Notes with respect to which an Additional
Tax Amount is or may be required), at any time, upon giving notice to the Lender
not less than 30 days nor more than 60 days prior to the date fixed for
redemption (which notice shall be irrevocable), at a redemption price equal to
the principal amount thereof, together with interest accrued to the date fixed
for redemption and any Additional Tax Amounts payable with respect thereto, if
MSX International Limited determines and certifies to the Lender immediately
prior to the giving of such notice that (i) it has or will become obligated to
pay Additional Tax Amounts in respect of such MSX Limited Notes as a result of
any change in or amendment to the laws (or any regulations or rulings
promulgated thereunder) of the United Kingdom or any relevant jurisdiction or
any political subdivision or taxing authority thereof or therein affecting
taxation, or any change in the official position regarding the application or
interpretation of such laws, regulations or rulings (including a holding by a
court of competent jurisdiction) which change or amendment becomes effective on
or after the date of issuance of such MSX Limited Notes and (ii) such obligation
cannot be avoided by MSX Limited taking reasonable measures available to it,
provided, that no such notice of redemption shall be given earlier than 60 days
prior to the earliest date on which MSX Limited would be obligated to pay such
Additional Tax Amounts if a payment in respect of such MSX Limited Notes was
then due. Prior to the giving of any notice of redemption described in this
paragraph, MSX Limited shall deliver to the Lender an Officers' Certificate
stating that the obligation to pay Additional Tax Amounts cannot be avoided by
MSX Limited taking reasonable measures available to them and (b) a written
opinion of independent legal counsel to MSX Limited to the effect that MSX
Limited has become obligated to pay Additional Tax Amounts as a result of a
change or amendment described above and that MSX Limited cannot avoid payment of
such Additional Tax Amounts by taking reasonable measures available to them.
The Lender shall reasonably cooperate with MSX Limited and shall use all
reasonable efforts to reduce or eliminate, or secure a refund of, Withholding
Taxes with respect to payments made under the MSX Limited Notes, including, but
not limited to, complying with any and all administrative procedures under the
UK-US income tax treaty to secure the reduction, elimination or refund of such
Withholding Taxes. If MSX Limited has paid any Additional Tax Amounts to the
Lender and the Lender, or any beneficial owner of the Lender, in its sole
discretion determines that it has received a refund of Withholding Taxes to
which such Additional Tax Amounts are attributable, then the Lender shall use
any and all reasonable efforts to cause such refund to be promptly paid over to
MSX Limited. The prior two sentences shall not be construed to require Lender to
make available its (or any of its beneficial owners') tax
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returns (or any other information relating to taxes which it deems confidential)
to MSX Limited or any other Person or entity.
SECTION 2.3. Prepayments and Payments.
(a) Prepayments.
(i) Voluntary Prepayments.
(A) So long as all Lender Obligations
have been indefeasibly paid in full, the Commitments have been terminated and
the Senior Secured Notes and Third Lien Notes have been indefeasibly paid in
full, the Borrowers may prepay the Loans, in whole or in part, without premium
or penalty.
(B) Voluntary prepayments hereunder shall
be credited against the Loans pursuant to the terms and conditions of Section
2.3(a)(iii). Amounts of the Loans so prepaid may not be reborrowed.
(ii) Mandatory Prepayments.
(A) Sale or Disposition of Assets. So
long as all Lender Obligations have been indefeasibly paid in full, the
Commitments have been terminated and the Senior Secured Notes and Third Lien
Notes have been indefeasibly paid in full, in addition to all other payments of
the Loans required hereunder, the Borrowers shall prepay the Loans by an amount
equal to 100% of all of the Net Available Cash from any sale or other
disposition of any assets (other than the sale of inventory in the ordinary
course of business upon customary credit terms, sales of scrap or obsolete
material or equipment which are not material in the aggregate, sales of assets
pursuant to a Permitted Securitization Transaction, disposition of Cash
Equivalents, and transfers of assets, including without limitation Capital
Stock, between domestic Guarantors or between the Company and domestic
Guarantors or between Subsidiaries (other than MSX Limited) which are not
Guarantors or from a Subsidiary which is not a Guarantor to a Guarantor or a
Borrower) in excess of $2,000,000 in aggregate amount in any fiscal year (other
than such Net Available Cash from the sale of assets which are used or
contractually committed to be used within 180 days of the date received to
replace the assets so sold or otherwise disposed of with an asset of comparable
value or to acquire an asset of comparable value), which payments shall be due
twenty (20) days after the end of each month for all such sales and other
dispositions during such month. So long as all Lender Obligations have been
indefeasibly paid in full, the Commitments have been terminated and the Senior
Secured Notes and Third Lien Notes have been indefeasibly paid in full, the
Company shall provide an Officers' Certificate to the Lender within twenty (20)
days after each sale of assets which, but for the above parenthetical, would
cause a prepayment under this Section 2.3(a)(ii)(A), which certificate shall
describe such sale of assets and estimate when such Net Available Cash will be
used to purchase assets of a comparable value, and if such Net Available Cash is
not used or contractually committed to be used within one-hundred eighty (180)
days after such sale or such earlier date when the Company has determined not to
purchase assets of comparable value with
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such Net Available Cash, the Borrowers will then prepay the Loans with such Net
Available Cash. So long as all Lender Obligations have been indefeasibly paid in
full, the Commitments have been terminated and the Senior Secured Notes and
Third Lien Notes have been indefeasibly paid in full, the Company shall apply an
amount equal to 100% of the Net Available Cash that the Company so receives to
the repayment of the Loans, as provided in Section 2.3(a)(iii) below.
(B) Issuance of Capital Stock;
Incurrence of Subordinated Debt. So long as all Lender Obligations have been
indefeasibly paid in full, the Commitments have been terminated and the Senior
Secured Notes and Third Lien Notes have been indefeasibly paid in full, in
addition to all other payments of the Loans required hereunder, the Borrowers
shall prepay the Loans by an amount equal to 100% of the Net Cash Proceeds from
(i) the issuance or other sale of any Capital Stock of the Company or any of its
Subsidiaries (excluding such Net Cash Proceeds from Capital Stock issued to
employees, directors or consultants of the Company or its Subsidiaries up to
$10,000,000 in any 12 month period) or (ii) the incurrence of any Subordinated
Debt by the Company or any of its Subsidiaries on or after the Original
Effective Date to the extent the amount of such Subordinated Debt in the
aggregate exceeds an amount equal to $150,000,000 minus the aggregate amount of
the Loans. So long as all Lender Obligations have been indefeasibly paid in
full, the Commitments have been terminated and the Senior Secured Notes and
Third Lien Notes have been indefeasibly paid in full, the Company shall apply an
amount equal to 100% of the Net Cash Proceeds that the Company so receives to
the repayment of the Loans, as provided in Section 2.3(a)(iii) below.
(C) Incurrence of
Indebtedness. So long as all Lender Obligations have been indefeasibly paid in
full, the Commitments have been terminated and the Senior Secured Notes and
Third Lien Notes have been indefeasibly paid in full, in addition to all other
payments of the Loans required hereunder, the Borrowers shall prepay the Loans
by an amount equal to 100% of the Net Cash Proceeds from the incurrence of any
Subordinated Indebtedness in excess of $5,000,000, payable on each date such
Indebtedness is incurred. So long as all Lender Obligations have been
indefeasibly paid in full, the Commitments have been terminated and the Senior
Secured Notes and Third Lien Notes have been indefeasibly paid in full, the
Company shall apply an amount equal to 100% of the Net Cash Proceeds that the
Company so receives to the repayment of the Loans, as provided in Section
2.3(a)(iii) below.
(D) Change of Control.
(i) In addition to all other
payments of the Loans required hereunder, simultaneously with the occurrence of
a Change of Control of the Company (the "Change of Control Date"), so long as
all Lender Obligations have been indefeasibly paid in full, the Commitments have
been terminated and the Senior Secured Notes and Third Lien Notes have been
indefeasibly paid in full, the Lender shall have the right, but not the
obligation, to require the prepayment of the Loans and Notes in whole. Within
thirty (30) days following a Change of Control Date, the Company shall give a
written notice to the Lender stating that a Change of Control of the Company has
occurred. The Lender shall, within ten (10) Business
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Days receipt of such notice, notify the Company if it will require a prepayment
of the Loans and Notes hereunder.
(ii) In addition to all other
payments of the Loan required hereunder, simultaneously with the occurrence of a
Change of Control of MSX Limited (the "Limited Change of Control Date"), so long
as all Lender Obligations of MSX Limited and Commitments available to MSX
Limited have been terminated and the U.K. Senior Secured Notes and Third Lien
Notes issued by MSX Limited have been indefeasibly paid in full, the Lender
shall have the right, but not the obligation, to require the prepayment of, and
MSX Limited shall have the right to prepay, the MSX Limited Loan and MSX Limited
Notes in whole. Within thirty (30) days following a Limited Change of Control
Date, the Borrowers shall give a written notice to the Lender stating that a
Change of Control of MSX Limited has occurred. If MSX Limited has not prepaid
the MSX Limited Loan and MSX Limited Notes by such time, the Lender shall,
within ten (10) Business Days receipt of such notice, notify the Borrowers if it
will require a prepayment of the MSX Limited Loans and MSX Limited Notes
hereunder.
(E) Notice. The Borrowers
shall notify the Lender of any prepayment to be made pursuant to Sections
2.3(a)(ii)(A), (B) and (C) at least ten (10) Business Days prior to such
prepayment date (unless shorter notice is satisfactory to the Lender).
(iii) Application of Prepayments. All
prepayments (whether voluntary or mandatory) shall include payment of accrued
interest on the principal amount of the Loans so prepaid and shall be applied to
payment of interest and fees before application to principal. All prepayments
(whether voluntary or mandatory) on the Notes, excluding prepayments pursuant to
Section 2.2(e) or Section 2.3(a)(ii)(D)(ii), shall be made and applied to the
Company Notes and the MSX Limited Notes on a pro rata basis based on the
aggregate principal amount of the Notes outstanding at the time of prepayment,
unless a Change of Control of MSX Limited has occurred.
(b) Manner and Time of Payment. All payments by
the Borrowers hereunder and under the Notes of principal, interest, premium, and
fees shall be made without defense, set-off, or counterclaim, in same day funds
and delivered to the Lender not later than 2:00 p.m. (New York time) on the date
due at 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx, or such other place
designated in writing by the Lender and delivered to the Borrowers, for the
account of the Lender. Funds received by the Lender after such time shall be
deemed to have been paid by the Borrowers on the next succeeding Business Day.
(c) Payments on Non-Business Days. Whenever any
payment to be made hereunder or under the Notes shall be stated to be due on a
day which is not a Business Day, the payment shall be made on the next
succeeding Business Day and such extension of time shall be included in the
computation of the payment of interest hereunder or under the Notes.
(d) Notation of Payment. The Lender agrees that
before disposing of a Note held by it, or any part thereof (other than by
granting participations therein), the Lender will
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make a notation thereon of all principal payments previously made thereon and of
the date to which interest thereon has been paid and will notify the Borrowers
of the name and address of the transferee of that Note; provided that the
failure to make (or any error in the making of) a notation of the Loan made
under such Note or to notify the Borrowers of the name and address of a
transferee shall not limit or otherwise affect the obligations of the Borrowers
hereunder or under such Notes with respect to the Loans and payments of
principal or interest on such Notes.
SECTION 2.4. Intentionally Omitted.
SECTION 2.5. Fees. On the Original Effective Date, the
Company paid to the Lender a nonrefundable closing fee in the amount of
$450,000, which amount was added to the principal balance of the Notes. Such
closing fee shall be nonrefundable under all circumstances.
SECTION 2.6. Guaranties; Security and Collateral. To
secure and guarantee, as the case may be, the payment when due of (i) the
Obligations of the Company arising out of or in connection with the Company Loan
and Company Notes and (ii) the Guaranties by the Guarantors of the Obligations
of MSX Limited arising out of or in connection with the MSX Limited Loan and MSX
Limited Notes, the Company and each Guarantor shall execute and deliver, or
cause to be executed and delivered, to the Lender Security Documents granting
the following; provided that all of the following shall be subject to the
Intercreditor Agreement (and the Company and the Guarantors shall not provide
any of the following if any of the following is prohibited by the Intercreditor
Agreement and, without limiting the terms of the Intercreditor Agreement, the
priority of all Liens in favor of the Lender and all rights of the Lender with
respect to any such Liens shall be subject to the Intercreditor Agreement):
(a) Security interests in all present and future
accounts, inventory, equipment, fixtures and all other personal property and all
Investment Property (as defined in the Uniform Commercial Code) of the Company
and each Guarantor which is a Domestic Restricted Subsidiary, excluding the
Capital Stock excluded pursuant to Section 2.6(b) below and excluding the
following (the following described assets in this parenthetical are defined as
the "Excluded Collateral"): (i) motor vehicles, instruments and chattel paper
with an aggregate fair market value for all of the foregoing less than
$1,000,000, (ii) real property leases and (iii) rights arising under any
contracts or licenses (other than, in each of the foregoing cases, any right to
receive payment) as to which a grant of a security interest would constitute a
violation of a valid and enforceable restriction in favor of a third party on
such grant, unless and until any required consents shall have been obtained,
provided that the Company shall notify the Lender of any such restriction and
shall use all reasonable efforts to obtain any required consent to the extent
requested by the Lender;
(b) Pledges of 100% of the Capital Stock of
certain Subsidiaries which are Domestic Restricted Subsidiaries owned directly
by the Company or by any Domestic Restricted Subsidiary and 65% of all Capital
Stock (or, if such 65% pledge of Capital Stock cannot be obtained or would cause
an additional and material tax liability for the Company and its Subsidiaries, a
pledge of such other claims and/or rights with respect to such Foreign
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Subsidiaries and such other arrangements and agreements as required by the
Lender) of certain Foreign Subsidiaries owned directly by the Company or by any
Domestic Restricted Subsidiary and Guaranties of certain present and future
Domestic Restricted Subsidiaries such that, at all times, the Domestic
Restricted Subsidiaries which are not Guarantors and that do not have 100% of
their Capital Stock pledged pursuant to Pledge Agreements and the Foreign
Subsidiaries owned directly by the Company that do not have 65% of their Capital
Stock (or, if such 65% pledge of Capital Stock cannot be obtained or would cause
an additional and material tax liability for the Company and its Subsidiaries, a
pledge of such other claims and/or rights with respect to such Foreign
Subsidiaries and such other arrangements and agreements as required by the
Lender) pledged pursuant to Pledge Agreements do not, if considered in the
aggregate as a single Subsidiary, constitute a Significant Subsidiary. In
connection with the delivery of any such Guaranties and Pledge Agreements, the
Company and the Guarantors shall provide such other documentation to the Lender,
including, without limitation, if requested by the Lender, one or more opinions
of counsel satisfactory to the Lender, corporate documents and resolutions and
consents and other documents (further including, without limitation, such
consents from any shareholders or other owners of any Subsidiary to the
execution and performance of such Loan Documents by such Subsidiary), which in
the opinion of the Lender are necessary or advisable in connection therewith;
(c) Guaranties of each other Guarantor, other
than Domestic Restricted Subsidiaries covered by clause (b) above;
(d) All other security and collateral described
in the Security Documents.
To secure and guarantee, as the case may be, the payment when due of the
Obligations of MSX Limited arising out of or in connection with the MSX Limited
Loan and MSX Limited Notes (but excluding the Obligations arising out of the
Company Notes), MSX Limited shall execute and deliver, or cause to be executed
and delivered, to the Lender the U.K. Deed; provided that all of the following
shall be subject to the Intercreditor Agreement and the priority of all Liens in
favor of the Lender under the U.K. Deed and all rights of the Lender with
respect to any such Liens shall be subject to the Intercreditor Agreement.
Upon request of the Lender, (i) the Company and the Guarantors which are
Domestic Restricted Subsidiaries shall execute and deliver such agreements and
documents reasonably requested by the Lender to grant a fourth priority lien and
security interest on all real property owned by the Company and the Guarantors
(subject to Section 5.3 hereof), and (ii) each other Domestic Restricted
Subsidiary shall execute and deliver all agreements and documents reasonably
requested by the Lender to grant a fourth priority lien and security interest on
all assets owned by such Subsidiary, to secure the indebtedness and other
obligations of such Subsidiary owing pursuant to the Loan Documents, unless it
is prohibited by applicable law or existing contractual restrictions from doing
so or it is reasonably determined by the Lender to be impractical or
unreasonably costly. Notwithstanding anything to the contrary herein, the
security interests granted hereunder shall be junior to the security interests
in favor of the Agent under the Senior Credit Facility securing the Lender
Obligations, the security interests in favor of the Collateral
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Agent under the Senior Secured Note Indenture, and the security interests in
favor of the Third Lien Lender securing the Third Lien Notes, all as described
in the Intercreditor Agreement, shall only be fourth priority liens and security
interests so long as the first, second and third priority liens and security
interests in favor of the Agent securing the Lender Obligations, in favor of the
Collateral Agent securing the Senior Secured Notes and in favor of the Third
Lien Lender securing the Third Lien Notes have not terminated. Except to the
extent provided in the U.K. Deed, the Lender shall not be entitled to any liens
or security interests on any assets of any Foreign Subsidiaries.
To the extent any Security Documents conflict with the terms and conditions of
the Intercreditor Agreement, the terms of the Intercreditor Agreement shall
control.
ARTICLE 3 CONDITIONS
SECTION 3.1. Conditions to this Agreement. The
effectiveness of this Agreement is subject to the satisfaction of all of the
following conditions:
(a) Corporate Authorizations. Delivery to the
Lender of copies of all authorizing resolutions and evidence of other corporate
action taken by each Borrower and each Guarantor to authorize the execution,
delivery and performance by each Borrower and each Guarantor of this Agreement,
the Notes and the other Loan Documents dated the date hereof to which each is a
party and the consummation by such Borrower or such Guarantor, respectively, of
the transactions contemplated thereby, certified as true and correct as of the
Effective Date in an Officers' Certificate of the Company or each Guarantor,
respectively;
(b) Incumbency Certificate. Delivery to the
Lender of Certificates of incumbency of each Borrower and each Guarantor
containing, and attesting to the genuineness of, the signatures of those
officers or members, as the case may be, authorized to act on behalf of each
Borrower or each Guarantor in connection with this Agreement and the Loan
Documents dated the date hereof to which the Company and each Guarantor is a
party and the consummation by such Borrower or such Guarantor of the
transactions contemplated thereby, certified as true and correct as of the
Effective Date in an Officers' Certificate of each Borrower and each Guarantor;
(c) Loan Documents. Delivery to the Lender of
this Agreement, the Company Notes, the MSX Limited Notes, the Guaranties, the
Security Agreements, the U.K. Deed, and any other Loan Documents dated the date
hereof duly executed on behalf of the Borrowers and the Guarantors, as the case
may be;
(d) Representations and Warranties. Each of the
Borrowers shall have delivered to the Lender an Officers' Certificate in form
and substance satisfactory to the Lender to the effect that the representations
and warranties in Article 4 of this Agreement are true, correct and complete in
all respects on and as of the Effective Date to the same extent as though made
on and as of such date;
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(e) Consents, Approvals, Etc. Copies of all
governmental and non-governmental consents, approvals, authorizations,
declarations, registrations or filings, if any, required on the part of any
Borrower or any Guarantor in connection with the execution, delivery and
performance of this Agreement and the Loan Documents dated the date hereof or
the transactions contemplated thereby or as a condition to the legality,
validity or enforceability of the Loan Documents dated the date hereof,
certified as true and correct and in full force and effect as of the Effective
Date in an Officers' Certificate of each Borrower, or if none are required, an
Officers' Certificate to that effect;
(f) Fees and Expenses. The Lender shall have
received payment in full for all expenses (including reasonable attorneys' fees)
incurred in connection with the negotiation and execution of this Agreement and
the Loan Documents dated the date hereof;
(g) Other Documents. The Restated Senior Credit
Agreement, the Senior Secured Note Indenture and the Third Lien Loan Agreement
shall have been duly executed by the parties thereto and shall be in full force
and effect;
(h) Termination of Funding Agreement. The Lender
shall have a received a written agreement from the Agent and the Required
Lenders (as defined in the Restated Credit Agreement), in form and substance
satisfactory to the Lender, terminating the Funding Agreement, the guarantee
letter of Citicorp delivered pursuant to Section 9(d) of the Funding Agreement
and all obligations of the Lender and Citicorp thereunder, and such agreement
shall be in full force and effect; and
(i) Other Conditions. Delivery of such other
documents and completion of such other matters as the Lender may reasonably
request.
ARTICLE 4 REPRESENTATIONS AND WARRANTIES
To induce the Lender to enter into this Agreement and to make
the Loan, each of the Borrowers, on behalf of itself and its Subsidiaries,
represents and warrants to the Lender that, as of the date hereof and as of the
Effective Date:
SECTION 4.1. Corporate Existence and Power. Each of the
Borrowers and the Guarantors is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of incorporation or
organization, and is duly qualified to do business, and is in good standing, in
all additional jurisdictions where such qualification is necessary under
applicable law, except for those jurisdictions where the failure to so qualify
or be in good standing could not reasonably be expected to result in any
Material Adverse Effect. Each of the Borrowers and the Guarantors has all
requisite corporate power to own or lease the properties used in its business
and to carry on its business substantially as now being conducted and as
proposed to be conducted, and to execute and deliver the Loan Documents to which
it is a party and to engage in the transactions contemplated by the Loan
Documents.
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SECTION 4.2. Corporate Authority. The execution, delivery
and performance by each of the Borrowers and the Guarantors of the Loan
Documents to which it is a party have been duly authorized by all necessary
corporate action and are not in contravention of any law, rule or regulation, or
any judgment, decree, writ, injunction, order or award of any arbitrator, court
or governmental authority, or of the terms of any Borrower's or any Guarantor's
charter or by-laws or comparable organizational documents, or of any material
contract or undertaking to which any Borrower or any Guarantor is a party or by
which any Borrower or any Guarantor or their respective material property may be
bound or affected or result in the imposition of any Lien except for Permitted
Liens.
SECTION 4.3. Binding Effect. The Loan Documents to which
any Borrower or any Guarantor is a party are the legal, valid and binding
obligations of the Borrowers and the Guarantors, respectively, enforceable
against the Borrowers and Guarantors in accordance with their respective terms,
subject to the effect of bankruptcy, insolvency, reorganization, moratorium and
other similar laws affecting the rights of creditors generally and by general
principles of equity.
SECTION 4.4. Subsidiaries. Each corporation, partnership,
or other entity in which the Company, directly or indirectly through any of its
subsidiaries, owns more than fifty percent (50%) of any class of equity
securities or interests is listed on Schedule 4.4 attached hereto. All of the
outstanding shares of capital stock or other equity interests of each of the
Subsidiaries are owned, directly or indirectly, by the Company, free and clear
of all Liens, other than Permitted Liens and those Liens imposed by the Act and
the securities or "Blue Sky" laws of certain domestic or foreign jurisdictions.
Except as disclosed in the Final Offering Circular, there are no outstanding (A)
options, warrants or other rights to purchase from the Company or any of its
Subsidiaries (other than those options granted to Xxxxxx Xxxxxxxxx in June
2003), (B) agreements, contracts, arrangements or other obligations of the
Company or any of its Subsidiaries to issue or (C) other rights to convert any
obligation into or exchange any securities for, in the case of each of clauses
(A) through (C), shares of capital stock of or other ownership or equity
interests in any of the Subsidiaries.
SECTION 4.5. Proceedings. Except as disclosed in the
Final Offering Circular, there is no action, claim, suit, demand, hearing,
notice of violation or deficiency, or proceeding, domestic or foreign
(collectively, "Proceedings"), pending or, to the knowledge of the Borrowers,
threatened, that either (i) seeks to restrain, enjoin, prevent the consummation
of, or otherwise challenge any of the Loan Documents or any of the transactions
contemplated therein, or (ii) would, individually or in the aggregate, have a
Material Adverse Effect. The Borrowers are not subject to any judgment, order,
decree, rule or regulation of any Governmental Authority that would,
individually or in the aggregate, have a Material Adverse Effect.
SECTION 4.6. Financial Condition. The audited
consolidated financial statements and related notes of the Company contained in
the Final Offering Circular (the "Financial Statements") present fairly in all
material respects the financial position, results of operations and cash flows
of the Company and its consolidated Subsidiaries, as of the respective
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dates and for the respective periods to which they apply and have been prepared
in accordance with GAAP and comply as to form with the requirements of
Regulation S-X of the Act. The financial data set forth under "Summary
Consolidated Financial Data" and "Selected Consolidated Financial Data" included
in the Final Offering Circular has been prepared on a basis consistent with that
of the Financial Statements and present fairly in all material respects the
financial position and results of operations of the Company and its consolidated
Subsidiaries as of the respective dates and for the respective periods
indicated. All other financial, statistical, and market and industry-related
data included in the Final Offering Circular are fairly and accurately presented
in all material respects and are based on or derived from sources that the
Company believes to be reliable and accurate in all material respects.
Subsequent to the respective dates as of which information is given in the Final
Offering Circular, except as disclosed in the Final Offering Circular, (i)
neither the Company nor any of its Subsidiaries has (x) incurred any
liabilities, direct or contingent, that are material, individually or in the
aggregate, to the Company, or (y) has entered into any transactions not in the
ordinary course of business which are material with respect to the Company and
its Subsidiaries considered as one enterprise, (ii) there has not been any
material decrease in the capital stock or any material increase in long-term
indebtedness or any material increase in short-term indebtedness of the Company,
or any payment of or declaration to pay any dividends or any other distribution
with respect to the Company, and (iii) there has not been any material adverse
change in the business, prospects, results of operations, or financial condition
of the Company and its Subsidiaries in the aggregate (each of clauses (i), (ii)
and (iii), a "Material Adverse Change").
SECTION 4.7. Consents, Etc. No consent, approval,
authorization or order of any Governmental Authority, or third party is required
in connection with the execution, delivery and performance of any Loan Document
or the consummation by the Borrowers of the transactions contemplated hereby,
except such as have been obtained.
SECTION 4.8. Taxes. Except as set forth on Schedule 4.8
attached hereto, all Tax returns required to be filed (taking into account all
applicable extensions) by the Company and each of its Subsidiaries have been
filed and all such returns are true, complete, and correct in all material
respects. All material Taxes that are due from the Company and its respective
Subsidiaries have been paid other than those (i) currently payable without
penalty or interest or (ii) being contested in good faith and by appropriate
proceedings and for which adequate reserves have been established in accordance
with GAAP consistently applied. To the knowledge of the Company, after
reasonable inquiry, there are no proposed Tax assessments against the Company or
any of its Subsidiaries that would, individually or in the aggregate, have a
Material Adverse Effect. The accruals and reserves on the books and records of
the Company and its respective Subsidiaries in respect of any material Tax
liability for any period not finally determined are adequate to meet any
assessments of Tax for any such period. For purposes of this Agreement, the term
"Tax" and "Taxes" shall mean all Federal, state, local and foreign taxes, and
other assessments of a similar nature (whether imposed directly or through
withholding), including any interest, additions to tax, or penalties applicable
thereto.
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SECTION 4.9. Title to Properties; Applicable Agreements.
Each of the Company and its respective Subsidiaries has good and marketable
title to all personal property owned by it and good and indefeasible title to
all leasehold estates in real and personal property being leased by it and, as
of the date hereof, will be free and clear of all Liens (other than Permitted
Liens). All Applicable Agreements to which the Company or any of its
Subsidiaries is a party or by which any of them is bound are valid and
enforceable against each of the Company or such Subsidiary, as applicable, and
are valid and enforceable against the other party or parties thereto and are in
full force and effect with only such exceptions as would not, individually or in
the aggregate, have a Material Adverse Effect.
SECTION 4.10. ERISA. Each of the Company, its Subsidiaries
, and each ERISA Affiliate has fulfilled its obligations, if any, under the
minimum funding standards of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Employee
Retirement Income Security Act of 1974, as amended ("ERISA") with respect to
each "pension plan" (as defined in Section 3(2) of ERISA), subject to Section
302 of ERISA which the Company, its Subsidiaries, or any ERISA Affiliate
sponsors or maintains, or with respect to which it has (or within the last three
years had) any obligation to make contributions, and each such plan is in
compliance in all material respects with the presently applicable provisions of
ERISA and the Code. Neither the Company, its Subsidiaries, nor any ERISA
Affiliate has incurred any unpaid liability to the Pension Benefit Guaranty
Corporation (other than for the payment of premiums in the ordinary course) or
to any such plan under Title IV of ERISA. "ERISA Affiliate" means a corporation,
trade or business that is, along with the Company or any Subsidiary, a member of
a controlled group of corporations or a controlled group of trades or
businesses, as described in Section 414 of the Code or Section 4001 of ERISA.
SECTION 4.11. Disclosure. The Preliminary Offering
Circular as of its date did not, and the Final Offering Circular as of its date
did not, and as of the date hereof does not, and each supplement or amendment
thereto as of its date will not, contain any untrue statement of a material fact
or omit to state any material fact (except, in the case of the Preliminary
Offering Circular, for pricing terms and other financial terms intentionally
left blank) necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided, however,
that the Borrowers make no representation or warranty as to the information
furnished in writing to the Borrowers by the Xxxxxxxxx & Company, Inc.
specifically for use therein.
SECTION 4.12. Environmental and Safety Matters. Each of
the Company and its Subsidiaries is (i) in compliance with any and all
applicable foreign, federal, state and local laws and regulations relating to
the protection of the environment or hazardous or toxic substances of wastes,
pollutants or contaminants ("Environmental Laws"), (ii) has received and is in
compliance with all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct its respective businesses and (iii) has
not received notice of any actual or potential liability for the investigation
or remediation of any disposal or release of hazardous or toxic substances or
wastes, pollutants or contaminants, except where such non-compliance with
Environmental Laws, failure to receive required permits, licenses or other
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approvals, or liability would not, individually or in the aggregate, have a
Material Adverse Effect, whether or not arising from transactions in the
ordinary course of business. Neither the Company nor any of the Subsidiaries has
been named as a "potentially responsible party" under the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended.
SECTION 4.13. No Default. Neither the Company nor any
Subsidiary is in breach of or default under any Applicable Agreements, other
than as disclosed in the Final Offering Circular and except for breaches and
defaults that could not result in a Material Adverse Effect. There exists no
condition that, with the passage of time or otherwise, would (a) constitute a
breach of or default under any Applicable Agreement or (b) result in the
imposition of any penalty or the acceleration of any indebtedness, that in (a)
or (b) above could result in a Material Adverse Effect. Immediately after
consummation of the transactions contemplated by this Agreement, the Loan
Documents, the Third Lien Loan Agreement, the Senior Secured Debt Documents and
the Senior Debt Documents, no Default or Event of Default will exist.
SECTION 4.14. Intellectual Property. Each of the Company
and its Subsidiaries owns, or is licensed under, and has the right to use, or
can acquire on reasonable terms, adequate patents, patent rights, licenses,
inventions, copyrights, know-how (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks and trade names (collectively,
"Intellectual Property") necessary for the conduct of its businesses and, as of
the date hereof, are free and clear of all Liens, other than Permitted Liens. To
the Company's knowledge, no claims or notices of any potential claim have been
asserted by any person challenging the use of any such Intellectual Property by
the Company or any of its Subsidiaries or questioning the validity or
effectiveness of the Intellectual Property or any license or agreement related
thereto (other than any claims that, if successful, would not, individually or
in the aggregate, have a Material Adverse Effect). To the Company's knowledge,
the use of such Intellectual Property by the Company or any of its Subsidiaries
will not infringe on the Intellectual Property rights of any other person.
SECTION 4.15. Labor Matters. (i) Other than the collective
bargaining agreements listed in Schedule 4.15 attached hereto, neither the
Company nor any of the Guarantors is party to or bound by any collective
bargaining agreement with any labor organization; (ii) there is no union
representation question existing with respect to the employees of the Company or
the Guarantors, and, to the knowledge of the Company, no union organizing
activities are taking place that could, individually or in the aggregate, have a
Material Adverse Effect; (iii) to the Company's knowledge, no union organizing
or decertification efforts are underway or threatened against the Company or the
Guarantors that, could, individually or in the aggregate, have a Material
Adverse Effect; (iv) no labor strike, work stoppage, slowdown, or other labor
dispute is pending against the Company or the Guarantors, or, to the knowledge
of the Company, threatened against the Company or the Guarantors that, could,
individually or in the aggregate, have a Material Adverse Effect; (iv) there is
no worker's compensation liability, experience or matter that, could,
individually or in the aggregate, have a Material Adverse
- 44 -
Effect; (v) to the knowledge of the Company, there is no threatened or pending
liability against the Company or the Guarantors pursuant to the Worker
Adjustment Retraining and Notification Act of 1988, as amended ("WARN") or any
similar state or local law that, could, individually or in the aggregate, have a
Material Adverse Effect; (vi) there is no employment-related charge, complaint,
grievance, investigation, unfair labor practice claim, or inquiry of any kind,
pending against the Company or the Guarantors that could, individually or in the
aggregate, have a Material Adverse Effect; (vii) to the knowledge of the
Company, no employee or agent of the Company or the Guarantors has committed any
act or omission giving rise to liability for any violation identified in
subsection (v) and (vi) above, other than such acts or omissions that would not,
individually or in the aggregate, have a Material Adverse Effect; and (viii) no
term or condition of employment exists through arbitration awards, settlement
agreements, or side agreement that is contrary to the express terms of any
applicable collective bargaining agreement other than such term or condition
that, could not, individually or in the aggregate, have a Material Adverse
Effect.
SECTION 4.16. Solvency. On the Effective Date, the
Borrowers will be solvent. As used in this paragraph, "solvent" means, with
respect to a particular date, that on such date the present fair market value
(present fair saleable value) of the assets of each of the Borrowers is not less
than the total amount required to pay the probable liabilities of the Borrowers
on its total existing debts and liabilities (including contingent liabilities)
as they become absolute and matured, the Borrowers are able to realize upon
their assets and pay their debts and other liabilities, contingent obligations
and commitments as they mature and become due in the normal course of business,
assuming on the Effective Date the sale of the Senior Secured Notes, the Third
Lien Notes and the Notes, the Borrowers are not incurring debts or liabilities
beyond their ability to pay as such debts and liabilities mature, and the
Borrowers are not engaged in any business or transaction, and are not about to
engage in any business or transaction, for which their property would constitute
unreasonably small capital after giving due consideration to the prevailing
practice in the industry in which the Borrowers are engaged. In computing the
amount of such contingent liabilities at any time, it is intended that such
liabilities will be computed at the amount that, in the light of all the facts
and circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.
SECTION 4.17. Not an Investment Company. Neither of the
Borrowers is nor, after giving effect to the offering and sale of the Units and
the application of the proceeds thereof as described in the Final Offering
Circular, will be an "investment company" as defined in the Investment Company
Act of 1940.
SECTION 4.18. Insurance. Each of the Company and each of
its respective Subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are prudent
and customary in the businesses in which they are engaged. All policies of
insurance insuring the Company or any of its respective Subsidiaries or their
respective businesses, assets, employees, officers and directors are in full
force and effect. The Company and its Subsidiaries are in compliance with the
terms of such policies and
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instruments in all material respects, and there are no claims by the Company or
any of its Subsidiaries under any such policy or instrument as to which any
insurance company is denying liability or defending under a reservation of
rights clause. Neither the Company nor any such Subsidiary has been refused any
insurance coverage sought or applied for, and neither the Company nor any such
Subsidiary has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not, individually or in the aggregate, have a
Material Adverse Effect.
ARTICLE 5 AFFIRMATIVE COVENANTS
SECTION 5.1. SEC Reports. Until such time as the Company
shall become subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act, the Company shall provide the Lender (upon request) with such
annual reports and such information, documents and other reports as are
specified in Sections 13 and 15(d) of the Exchange Act and applicable to a U.S.
corporation subject to such Sections, such information, documents and other
reports to be so provided at the times specified for the filing of such
information, documents and reports under such Sections. Thereafter,
notwithstanding that the Company may not be required to remain subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company
shall file with the SEC and provide the Lender (upon request) such annual
reports and such information, documents and other reports as are specified in
such Sections and applicable to a U.S. corporation subject to such Sections,
such information, documents and other reports to be so filed and provided at the
times specified for the filing of such information, documents and reports under
such Sections; provided, however, that the Company shall not be required to file
any report, document or other information with the SEC if the SEC does not
permit such filing. The Company shall simultaneously deliver to the Lender any
notice or other documentation delivered to the Agent or the Senior Lenders
pursuant to the Senior Credit Facility.
SECTION 5.2. Additional Security and Collateral. Subject
to the Intercreditor Agreement, each Borrower shall promptly (i) execute and
deliver and cause each Guarantor to execute and deliver, additional Security
Documents, within 30 days after request therefor by the Lender, sufficient to
grant to the Lender liens and security interests in any after acquired
Collateral of the type described in Section 2.6, and (ii) to the extent required
under Section 2.6, cause each Person becoming a Domestic Restricted Subsidiary
of the Company from time to time to execute and deliver to the Lender, within 60
days after such Person becomes a Domestic Restricted Subsidiary, a Guaranty and
a Security Agreement, together with other related documents described in Section
3.1 sufficient to grant to the Lender liens and security interests in all
Collateral of the type described in Section 2.6. The Company shall notify the
Lender, within 10 days after the occurrence thereof, of the acquisition of any
material property by the Company or any Guarantor that is not subject to the
existing Security Documents, any Person becoming a Domestic Restricted
Subsidiary and any other event or condition, other than the passage of time,
that may require additional action of any nature in order to preserve the
effectiveness and perfected status of the liens and security interests of the
Lender with respect to such property pursuant to the Security Documents,
including without limitation, so long as all
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Lender Obligations have been indefeasibly paid in full, the Commitments have
been terminated and the Senior Secured Notes and Third Lien Notes have been
indefeasibly paid in full, delivering the originals of all promissory notes and
other instruments payable to the Company or any Guarantors to the Lender and
delivering the originals of all stock certificates or other certificates
evidencing any Capital Stock owned by the Company or any Guarantors at any time.
SECTION 5.3. Real Estate Mortgages and Filings. With
respect to any real property other than a leasehold (individually and
collectively, the "Premises") acquired by the Company or any Domestic Restricted
Subsidiary after the date hereof with a fair market value of greater than $1.0
million on the date of acquisition, if requested by the Lender:
(a) the Company shall deliver to the Lender, as
mortgagee, fully-executed counterparts of Mortgages, each dated as of the date
of acquisition of such property, duly executed by the Company or the applicable
Subsidiary, together with evidence of the completion (or satisfactory
arrangements for the completion), of all recordings and filings of such Mortgage
as may be necessary to create a valid, perfected Lien, subject to Permitted
Liens, against the properties purported to be covered thereby;
(b) the Lender shall have received mortgagee's
title insurance policies in favor of the Lender, in amounts and in form and
substance and issued by insurers reasonably acceptable to the Lender, with
respect to the property purported to be covered by such Mortgage, insuring that
title to such property is marketable and that the interests created by the
Mortgage constitute valid Liens thereon free and clear of all Liens, defects and
encumbrances other than Permitted Liens, and such policies shall also include,
to the extent available, a revolving credit endorsement and such other
endorsements as necessary and shall be accompanied by evidence of the payment in
full of all premiums thereon; and
(c) the Company shall deliver to the Lender,
with respect to each of the covered Premises, filings, surveys, local counsel
opinions and fixture filings, along with such other documents, instruments,
certificates and agreements as the Lender and its counsel shall reasonably
request.
SECTION 5.4. Designation of Restricted and Unrestricted
Subsidiaries. The Board of Directors of the Company may designate any Subsidiary
of the Company (including any newly acquired or newly formed Subsidiary) to be
an Unrestricted Subsidiary if:
(a) the Subsidiary to be so designated (the "Designee")
does not own any Capital Stock or Indebtedness of, or own or hold any Lien on
any property of, the Company or any other Subsidiary (other than a direct or
indirect Subsidiary of the Designee, provided, however, that any such direct or
indirect Subsidiary of the Designee shall otherwise comply with clauses (a)
through (f) of this Section 5.4);
(b) the Subsidiary to be so designated is not obligated
under any Indebtedness, Lien or other obligation that, if in default, would
result (with the passage of time or notice or
- 47 -
otherwise) in a default on any Indebtedness of the Company or of any Subsidiary
(other than the Designee or a Subsidiary of the Designee that is an Unrestricted
Subsidiary);
(c) the Company certifies that such designation complies
with Section 6.4 (Limitation on Restricted Payments);
(d) such Subsidiary, either alone or in the aggregate
with all other Unrestricted Subsidiaries, does not operate, directly or
indirectly all or substantially all of the business of the Company and its
Subsidiaries;
(e) such Subsidiary does not directly or indirectly, own
any Indebtedness of or Capital Stock in, and has no Investments in, the Company
or any Restricted Subsidiary; and
(f) such Subsidiary is a Person with respect to which
neither the Company nor any of its Restricted Subsidiaries has any direct or
indirect obligation (i) to subscribe for additional Capital Stock or (ii) to
maintain or preserve such Person's financial condition or to cause such Person
to achieve any specified levels of operating results.
If, at any time, any Unrestricted Subsidiary would fail to meet the foregoing
requirements as an Unrestricted Subsidiary, it shall thereafter cease to be an
Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness of
such Subsidiary shall be deemed to be Incurred as of such date. For purposes of
making any such designation, all outstanding Investments by the Company and its
Restricted Subsidiaries (except to the extent repaid in cash) in the Subsidiary
will be deemed to be Restricted Payments at the time of such designation and
will reduce the amount available for Restricted Payments under clause (a)(3) of
Section 6.4 (Limitation on Restricted Payments). Such designation shall only be
permitted if such Restricted Payment would be permitted at such time and if such
Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary.
Any such designation or redesignation by the Board of Directors will be
evidenced to the Lender by delivering to the Lender a board resolution giving
effect to such designation or redesignation and an Officers' Certificate (a)
certifying that such designation or redesignation complies with the foregoing
provisions and (b) giving the effective date of such designation or
redesignation, such delivery to the Lender to occur within 45 days after the end
of the fiscal quarter of the Company in which such designation or redesignation
is made (or, in the case of a designation or redesignation made during the last
fiscal quarter of the Company's fiscal year, within 90 days after the end of
such fiscal year). Unless designated as an Unrestricted Subsidiary as herein
provided, each Subsidiary of the Company shall be a Restricted Subsidiary.
Except as provided herein, no Restricted Subsidiary shall be redesignated as an
Unrestricted Subsidiary.
The Board of Directors of the Company may designate any Unrestricted Subsidiary
to be a Restricted Subsidiary, if immediately after giving pro forma effect to
such designation (a) the Company could Incur $1.00 of additional Indebtedness
under paragraph (a) of Section 6.1 (Limitation on Incurrence of Indebtedness)
and (b) no Default or Event of Default shall have occurred and be continuing or
would result therefrom.
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SECTION 5.5. Compliance Certificate. The Company shall
deliver to the Lender within 120 days after the end of each fiscal year of the
Company a certificate signed by the principal executive, financial or accounting
officer of the Company, stating that to the best of such Officer's actual
knowledge, no breach of covenant or other obligations or any Default occurred
during such period, and if the Company shall not be in compliance with all
conditions and covenants under this Agreement, specifying such noncompliance and
the nature and status thereof.
SECTION 5.6. Further Instruments and Acts. Upon request
of the Lender, each Borrower will execute and deliver such further instruments
and do such further acts as may be reasonably necessary or proper to carry out
more effectively the purpose of this Agreement.
SECTION 5.7. Payment of Taxes and Other Claims. The
Borrowers shall, and shall cause each of their Subsidiaries to, pay or discharge
or cause to be paid or discharged, before the same shall become delinquent, all
material taxes, assessments and governmental charges levied or imposed upon
their or their Subsidiaries' income, profits or property; provided, however,
that neither the Borrowers nor any of their Subsidiaries shall be required to
pay or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim whose amount, applicability or validity is being contested in
good faith by appropriate negotiations or proceedings and for which disputed
amounts adequate reserves have been made in accordance with GAAP.
SECTION 5.8. Corporate Existence. Subject to Sections 6.3
and 6.9, each Borrower shall do or cause to be done, at its own cost and
expense, all things necessary to, and will cause each of its Restricted
Subsidiaries to, preserve and keep in full force and effect the corporate or
partnership existence and rights (charter and statutory), licenses and/or
franchises of such Borrower and each of its Restricted Subsidiaries; provided,
however, that neither the Borrowers nor any of their Restricted Subsidiaries
shall be required to preserve any such rights, licenses or franchises if the
Board of Directors of the Company shall reasonably determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Borrowers and the Subsidiaries, taken as a whole.
ARTICLE 6 NEGATIVE COVENANTS
SECTION 6.1. Limitation on Incurrence of Indebtedness.
(a) The Company shall not, and shall not permit any
Restricted Subsidiaries to, Incur, directly or indirectly, any Indebtedness;
provided, however, that the Company and the Guarantors may Incur Indebtedness
if, immediately after giving effect to such Incurrence, the Consolidated
Coverage Ratio exceeds 2.25 to 1.
(b) Notwithstanding Section 6.1(a), the Company and the
Restricted Subsidiaries may Incur any or all of the following Indebtedness:
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(1) Indebtedness Incurred pursuant to the Senior Credit
Facility and Guarantees of Indebtedness Incurred pursuant to the Senior Credit
Facility; provided, however, that, after giving effect to any such Incurrence,
the aggregate principal amount of such Indebtedness then outstanding does not
exceed the sum of (i) the greater of (x) $40.0 million less the amount of Net
Available Cash from Asset Dispositions used to permanently reduce indebtedness
under the Senior Credit Facility and (y) 20% of the net book value of the
accounts receivable of the Company and its Restricted Subsidiaries, determined
in accordance with GAAP and 20% of the net book value of the inventory of the
Company and its Restricted Subsidiaries, determined in accordance with GAAP,
(ii) Cash Management Obligations owing to the Agent, the Senior Lenders or their
respective Affiliates, and (iii) the amount by which the U.S. dollar equivalent
of the principal amount of the loans and letters of credit under the Senior
Credit Facility exceeds the amount allowed under the forgoing clauses (i) and
(ii) as a result of currency fluctuations;
(2) Indebtedness represented by (i) the Senior Secured
Notes issued in the Offering (and the Exchange Notes), and (ii) Indebtedness
represented by the Senior Secured Note Guarantees;
(3) Indebtedness pursuant to agreements as in effect on
the Effective Date (other than Indebtedness described in clause (1) of this
Section 6.1(b)), including without limitation the Third Lien Notes;
(4) Indebtedness of the Company owed to and held by a
Wholly-Owned Subsidiary or Indebtedness of a Wholly-Owned Subsidiary owed to and
held by the Company or a Wholly-Owned Subsidiary; provided, however, that (i)
any such Indebtedness of the Company or any Guarantor shall be unsecured and
subordinated to the Notes and (ii) any subsequent issuance or transfer of any
Capital Stock which results in any such Wholly-Owned Subsidiary ceasing to be a
Wholly-Owned Subsidiary or any subsequent transfer of such Indebtedness (other
than to the Company or a Wholly-Owned Subsidiary) shall be deemed, in each case,
to constitute the Incurrence of such Indebtedness by the issuer thereof;
(5) Refinancing Indebtedness in respect of Indebtedness
Incurred pursuant to Section 6.1(a) or pursuant to clause (2), (3) or this
clause (5) of Section 6.1(b);
(6) Indebtedness in respect of performance bonds,
bankers' acceptances, letters of credit and surety or appeal bonds entered into
by the Company or a Restricted Subsidiary in the ordinary course of business (in
each case other than an obligation for borrowed money);
(7) Hedging Obligations consisting of Interest Rate
Agreements and Currency Agreements entered into in the ordinary course of
business and not for the purpose of speculation; provided, however, that, in the
case of Currency Agreements and Interest Rate Agreements, such Currency
Agreements and Interest Rate Agreements do not increase the Indebtedness of the
Company outstanding at any time other than as a result of fluctuations in
- 50 -
foreign currency exchange rates or interest rates or by reason of fees,
indemnities and compensation payable thereunder;
(8) Purchase Money Indebtedness and Capital Lease
Obligations Incurred to finance the acquisition or improvement by the Company or
a Restricted Subsidiary of any assets in the ordinary course of business and
which do not exceed $3.0 million in the aggregate at any time outstanding;
(9) Indebtedness Incurred in respect of letters of credit
in an aggregate principal amount not to exceed $5 million, plus the amount by
which the U.S. dollar equivalent of the principal amount of such letters of
credit exceeds $5 million as a result of currency fluctuations;
(10) Indebtedness arising from the honoring by a bank or
other financial institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts) drawn against
insufficient funds in the ordinary course of business, provided that such
Indebtedness is extinguished within five business days of Incurrence;
(11) Indebtedness Incurred after the Effective Date
representing interest paid-in-kind;
(12) Indebtedness of Foreign Restricted Subsidiaries of
the Company, in an aggregate principal amount not to exceed $5.0 million at any
time outstanding; or
(13) Indebtedness in an aggregate principal amount which,
together with all other Indebtedness of the Company and its Restricted
Subsidiaries outstanding on the date of such Incurrence (other than Indebtedness
permitted by clauses (1) through (12) of this Section 6.1(b) or Section 6.1(a)),
does not exceed $10.0 million.
(c) For purposes of determining compliance with the
foregoing covenant, (i) in the event that an item of Indebtedness meets the
criteria of more than one of the types of Indebtedness described in Section
6.1(b), the Company, in its sole discretion, will classify such item of
Indebtedness and only be required to include the amount and type of such
Indebtedness in one of the above clauses and (ii) an item of Indebtedness may be
divided and classified in more than one of the types of Indebtedness described
in Section 6.1(b).
SECTION 6.2. Limitation on Liens. The Company shall not,
and shall not permit any Restricted Subsidiary to, directly or indirectly, Incur
or permit to exist any Lien (other than Permitted Liens) of any nature
whatsoever on any property of the Company or any Restricted Subsidiary
(including Capital Stock of a Restricted Subsidiary), whether owned at the
Effective Date or thereafter acquired.
SECTION 6.3. Limitation on Sale of Assets and Subsidiary
Stock.
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(a) The Company shall not, and shall not permit any
Restricted Subsidiary to, consummate any Asset Disposition unless: (i) the
Company or such Restricted Subsidiary receives consideration at the time of such
Asset Disposition at least equal to the fair market value (including as to the
value of all non-cash consideration), as determined in good faith by the Board
of Directors of the Company, of the shares and assets subject to such Asset
Disposition, and (ii) at least 75% of the consideration therefor received by the
Company or such Restricted Subsidiary is in the form of cash or cash
equivalents, provided, however, that this clause (ii) shall not apply if the
Company or a Restricted Subsidiary is disposing of assets in exchange for
Additional Assets.
For the purposes of this covenant, the assumption of
Indebtedness of the Company or any Restricted Subsidiary and the release of the
Company or such Restricted Subsidiary from all liability on such Indebtedness in
connection with such Asset Disposition is deemed to be cash.
With respect to any Asset Disposition occurring on or after
the Effective Date from which the Company or any Restricted Subsidiary receives
Net Available Cash, the Company or such Restricted Subsidiary shall:
(i) within 365 days after the date such Net Available
Cash is received and to the extent the Company or such Restricted Subsidiary
elects to: (A) apply an amount equal to such Net Available Cash to prepay,
repay, purchase or legally defease Applicable Indebtedness of the Company or
such Restricted Subsidiary, in each case owing to a Person other than the
Company or any Affiliate of the Company, or (B) invest an equal amount, or the
amount not so applied pursuant to clause (A), in Additional Assets (including by
means of an Investment in Additional Assets by a Guarantor with Net Available
Cash received by the Company or another Guarantor) and
(ii) apply such excess Net Available Cash (to the extent
not applied pursuant to clause (i)) as provided in the following paragraphs of
this Section 6.3; provided, however, that in connection with any prepayment,
repayment or purchase of Applicable Indebtedness pursuant to clause (A) above
(other than the repayment of Applicable Indebtedness Incurred under the Senior
Credit Facility to fund the purchase of an asset which is sold by the Company
within 180 days of its purchase pursuant to a Sale/Leaseback Transaction), the
Company or such Restricted Subsidiary shall retire such Applicable Indebtedness
and shall cause the related loan commitment (if any) to be permanently reduced
in an amount equal to the principal amount so prepaid, repaid or purchased.
The amount of Net Available Cash required to be applied
pursuant to clause (ii) above and not theretofore so applied shall constitute
"Excess Proceeds." Pending application of Net Available Cash pursuant to this
provision, such Net Available Cash shall be invested in Temporary Cash
Investments. Notwithstanding the foregoing, the Company may use Excess Proceeds
to acquire Senior Secured Notes through open market or privately negotiated
purchases, and Excess Proceeds at any time will be reduced by the principal
amount of Senior
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Secured Notes acquired (and surrendered to the Trustee for cancellation) by the
Company and its Restricted Subsidiaries through open market or privately
negotiated purchases on or after the date of the applicable Asset Disposition.
If at any time the aggregate amount of Excess Proceeds not
theretofore subject to an Excess Proceeds Offer (as defined below) totals at
least $3 million, the Company shall, not later than 30 days after the end of the
period during which the Company is required to apply such Excess Proceeds
pursuant to clause (i) of the immediately preceding paragraph of this Section
6.3(a) (or, if the Company so elects, at any time within such period), make an
offer (an "Excess Proceeds Offer") to purchase from the holders of Senior
Secured Notes and Applicable Pari Passu Indebtedness (determined on a pro rata
basis according to the accreted value or aggregate principal amount, as the case
may be, of the Senior Secured Notes and the Applicable Pari Passu Indebtedness)
in an amount equal to the Excess Proceeds (rounded down to the nearest multiple
of $1,000) on such date, at a purchase price equal to 100% of the principal
amount of such Senior Secured Notes, plus, in each case, accrued and unpaid
interest and Additional Amounts, if any, to the date of purchase (the "Excess
Proceeds Payment"). Upon completion of an Excess Proceeds Offer the amount of
Excess Proceeds remaining after application pursuant to such Excess Proceeds
Offer, (including payment of the purchase price for Senior Secured Notes duly
tendered) may be used by the Company for any corporate purpose (to the extent
not otherwise prohibited by this Agreement).
(b) Any repurchase of Senior Secured Notes pursuant to an
Excess Proceeds Offer shall include both U.S. Senior Secured Notes and U.K.
Senior Secured Notes on a pro rata basis based upon the aggregate principal
amount of the Senior Secured Notes outstanding at the time of such repurchase,
unless a change of Control of MSX Limited has occurred.
(c) The Company shall comply, to the extent applicable,
with the requirements of Section 14(e) of the Exchange Act and any other
securities laws or regulations thereunder in the event that such Excess Proceeds
are received by the Company under the covenant described hereunder and the
Company is required to repurchase Notes as described above. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of the covenant described hereunder, the Company shall comply with
the applicable securities laws and regulations and shall not be deemed to have
breached its obligations under the covenant described hereunder by virtue
thereof.
SECTION 6.4. Limitation on Restricted Payments.
(a) The Company shall not, and shall not permit any
Restricted Subsidiary, directly or indirectly, to make a Restricted Payment if
at the time the Company or such Restricted Subsidiary makes such Restricted
Payment: (1) a Default or an Event of Default shall have occurred and be
continuing (or would result therefrom); (2) the Company is not able to Incur an
additional $1.00 of Indebtedness pursuant to Section 6.1(a); or (3) the
aggregate amount of such Restricted Payment together with all other Restricted
Payments (the amount of any payments made in property other than cash to be
valued at the fair market value of such property,
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as determined in good faith by the Board of Directors of the Company) declared
or made since the Effective Date would exceed the sum of:
(A) 50% of the Consolidated Net Income accrued during the
period (treated as one accounting period) from the Effective Date to the end of
the most recent fiscal quarter prior to the date of such Restricted Payment for
which financial statements of the Company are available (or, in case such
Consolidated Net Income accrued during such period (treated as one accounting
period) shall be a deficit, minus 100% of such deficit);
(B) the aggregate Net Cash Proceeds received subsequent
to the Effective Date by the Company from the issuance or sale of (i) its
Capital Stock (other than Disqualified Stock or the issuance or sale of Capital
Stock to a Subsidiary of the Company) or (ii) the Capital Stock of a Restricted
Subsidiary pursuant to a Qualified TIPS Transaction (other than any issuance or
sale to a Subsidiary of the Company);
(C) the amount by which Indebtedness of the Company or
its Restricted Subsidiaries is reduced on the Company's balance sheet upon the
conversion or exchange (other than by a Subsidiary of the Company) subsequent to
the Effective Date, of any Indebtedness of the Company or its Restricted
Subsidiaries convertible or exchangeable for Capital Stock (other than
Disqualified Stock) of the Company (less the amount of any cash, or the fair
market value of any other property, distributed by the Company or any Restricted
Subsidiary upon such conversion or exchange); and
(D) an amount equal to the sum of the net reduction in
Investments resulting from repayments of loans or advances or other transfers of
assets subsequent to the Effective Date, in each case to the Company or any
Restricted Subsidiary; provided, however, that the foregoing amount shall not
exceed the amount of Investments previously made (and treated as a Restricted
Payment) by the Company or any Restricted Subsidiary in such Person.
(b) The provisions of Section 6.4(a) shall not prohibit:
(i) any purchase or redemption of Capital Stock or
Subordinated Obligations of the Company or any Restricted Subsidiary made in
exchange for, or out of the proceeds of the substantially concurrent sale of,
Capital Stock of the Company (other than Disqualified Stock and other than
Capital Stock issued or sold to a Subsidiary of the Company); provided, however,
that (A) such purchase or redemption shall be excluded from the calculation of
the amount of Restricted Payments; and (B) the Net Cash Proceeds from such sale
shall be excluded from the calculation of amounts under Section 6.4(a)(3)(B);
(ii) any purchase or redemption of (A) Subordinated
Obligations of the Company made in exchange for, or out of the proceeds of the
substantially concurrent sale of, Subordinated Obligations of the Company which
is permitted to be Incurred pursuant to Section 6.1(b) and (c) or (B)
Subordinated Obligations of a Restricted Subsidiary made in exchange for, or out
of the proceeds of the substantially concurrent sale of, Subordinated
Obligations of such
- 54 -
Restricted Subsidiary or the Company which is permitted to be Incurred pursuant
to Section 6.1(b) and (c); provided, however, that such purchase or redemption
shall be excluded from the calculation of the amount of Restricted Payments;
(iii) dividends paid within 60 days after the date of
declaration thereof if at such date of declaration such dividend would have
complied with this Section 6.4; provided, however, that at the time of payment
of such dividend, no other Default shall have occurred and be continuing (or
would result therefrom); provided, further, however, that such dividend shall be
included in the calculation of the amount of Restricted Payments;
(iv) any purchase or redemption or other retirement for
value of Capital Stock of the Company required pursuant to any shareholders
agreement, management agreement or employee stock option agreement in accordance
with the provisions of any such arrangement in an amount not to exceed $1.5
million in the aggregate; provided, however, that at the time of such purchase
or redemption, no other Default shall have occurred and be continuing (or would
result therefrom); provided, further, however, that such purchase or redemption
shall be included in the amount of Restricted Payments;
(v) Guarantees by the Company or any Restricted
Subsidiary of Indebtedness Incurred by the Company or a Restricted Subsidiary,
provided, however, that at the time such Guarantee is Incurred it would be
permitted under the covenant described under Section 6.1; provided, further,
however, that such Guarantee shall be excluded from the amount of Restricted
Payments;
(vi) any purchase or redemption of Senior Subordinated
Notes; provided, however, that the aggregate purchase price of all such
purchases and redemptions shall not exceed $10.0 million; or
(vii) if no Default or Event of Default will have occurred
and be continuing, Restricted Payments (in addition to those permitted by
clauses (i) through (vi) above) in an aggregate amount not to exceed $5.0
million subsequent to the Effective Date.
SECTION 6.5. Limitation on Affiliate Transactions.
(a) The Company shall not, and shall not permit any
Restricted Subsidiary to, enter into or permit to exist any transaction or
series of related transactions (including the purchase, sale, lease or exchange
of any property, employee compensation arrangements or the rendering of any
service) with any Affiliate of the Company (an "Affiliate Transaction") unless
the terms thereof:
(1) are no less favorable to the Company or such
Restricted Subsidiary than those that could be obtained at the time of such
transaction in arm's-length dealings with a Person who is not such an Affiliate;
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(2) if such Affiliate Transaction (or series of related
Affiliate Transactions) involves aggregate payments in an amount in excess of
$1.0 million (i) are set forth in writing and (ii) comply with clause (1) of
this Section 6.5(a);
(3) if such Affiliate Transaction (or series of related
Affiliate Transactions) involves aggregate payments in an amount in excess of
$2.5 million in any one year, (i) are set forth in writing, (ii) comply with
clause (2) of this Section 6.5(a) and (iii) have been approved by a majority of
the disinterested members of the Board of Directors of the Company, and
(4) if such Affiliate Transaction (or series of related
Affiliate Transactions) involves aggregate payments in an amount in excess of
$10.0 million in any one year, (i) comply with clause (3) of this Section 6.5(a)
and (ii) have been determined by a nationally recognized investment banking firm
to be fair, from a financial standpoint, to the Company and its Restricted
Subsidiaries.
(b) Section 6.5(a) shall not prohibit: (i) any Restricted
Payment permitted to be paid pursuant to Section 6.4, (ii) any issuance of
securities, or other payments, awards or grants in cash, securities or
otherwise, pursuant to, or the funding of, employment arrangements, stock
options and stock ownership plans in the ordinary course of business and
approved by the Board of Directors of the Company, (iii) the grant of stock
options or similar rights to employees and directors of the Company in the
ordinary course of business and pursuant to plans approved by the Board of
Directors of the Company; (iv) loans or advances to employees of the Company or
its Subsidiaries, provided, however, the aggregate amount of such loans or
advances made after the Effective Date and outstanding at any one time shall not
exceed $1.5 million; (v) fees, compensation or employee benefit arrangements
paid to and indemnity provided for the benefit of directors, officers or
employees of the Company or any Subsidiary in the ordinary course of business;
(vi) any Affiliate Transaction between the Company and a Restricted Subsidiary
or between Restricted Subsidiaries in the ordinary course of business (so long
as the other stockholders of any participating Restricted Subsidiaries which are
not Wholly Owned Subsidiaries are not themselves Affiliates of the Company), or
(vii) Existing Affiliate Agreements, including amendments thereto or
replacements thereof entered into after the Effective Date, provided, however,
that the terms of any such amendment or replacement are at least as favorable to
the Company as those that could be obtained at the time of such amendment or
replacement in arm's-length dealings with a Person which is not an Affiliate.
If the Company or any Restricted Subsidiary has complied with
all of the provisions of the foregoing paragraph (a) of this Section 6.5 other
than clause (4)(ii) thereof, such paragraph shall not prohibit the Company or
any Restricted Subsidiary from entering into Affiliate Transactions pursuant to
which the Company or any Restricted Subsidiary renders services in the ordinary
course of business to CVC or to Affiliates of CVC.
SECTION 6.6. Impairment of Security Interests. Subject to
the Intercreditor Agreement, neither the Company nor any Guarantor will take or
omit to take any action which would adversely affect or impair the Liens in
favor of the Lender with respect to
- 56 -
the Collateral. Neither the Company nor any of its Restricted Subsidiaries shall
grant to any Person, or permit any Person to retain (other than the Lender), any
interest whatsoever in the Collateral other than Permitted Liens. Neither the
Company nor any of its Restricted Subsidiaries will enter into any agreement
that requires the proceeds received from any sale of Collateral to be applied to
repay, redeem, defease or otherwise acquire or retire any Indebtedness of any
Person, other than as permitted by this Agreement, the Intercreditor Agreement
and the Loan Documents. The Company shall, and shall cause each Guarantor to, at
their sole cost and expense, execute and deliver all such agreements and
instruments to more fully or accurately describe the property intended to be
Collateral, or the obligations intended to be secured by the Security Documents.
The Company shall, and shall cause each Restricted Subsidiary to, at their sole
cost and expense, file any such notice filings or other agreements or
instruments as may be reasonably necessary or desirable under applicable law to
perfect the Liens created by the Security Documents at such times and at such
places as necessary.
SECTION 6.7. Limitations on Restrictions on Distributions
from Restricted Subsidiaries. The Company shall not, and shall not permit any
Restricted Subsidiary to, create or otherwise cause or permit to exist or become
effective any consensual encumbrance or consensual restriction on the ability of
any Restricted Subsidiary: (a) to pay dividends or make any other distributions
on its Capital Stock to the Company or a Restricted Subsidiary or pay any
Indebtedness owed to the Company, (b) to make any loans or advances to the
Company or (c) to transfer any of its property or assets to the Company, except:
(i) any encumbrance or restriction pursuant to an
agreement in effect at or entered into on the Effective Date;
(ii) any encumbrance or restriction with respect to a
Restricted Subsidiary pursuant to an agreement relating to any
Indebtedness Incurred by such Restricted Subsidiary which was entered
into on or prior to the date on which such Restricted Subsidiary was
acquired by the Company (other than as consideration in, or to provide
all or any portion of the funds or credit support utilized to
consummate, the transaction or series of related transactions pursuant
to which such Restricted Subsidiary became a Restricted Subsidiary or
was acquired by the Company) and outstanding on such date;
(iii) any encumbrance or restriction pursuant to an
agreement effecting a Refinancing of Indebtedness Incurred pursuant to
an agreement referred to in clause (i) or (ii) of this Section 6.7 (or
effecting a Refinancing of such Refinancing Indebtedness pursuant to
this clause (iii)) or contained in any amendment to an agreement
referred to in clause (i) or (ii) of this Section 6.7 or this clause
(iii); provided, however, that the encumbrances and restrictions with
respect to such Restricted Subsidiary contained in any such refinancing
agreement or amendment are no more restrictive in any material respect
than the encumbrances and restrictions with respect to such Restricted
Subsidiary contained in such agreements;
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(iv) any such encumbrance or restriction consisting of
customary non-assignment provisions in leases governing leasehold
interests to the extent such provisions restrict the transfer of the
lease or the property leased thereunder;
(v) in the case of Section 6.7(c) above, restrictions
contained in security agreements or mortgages securing Indebtedness of
a Restricted Subsidiary to the extent such restrictions restrict the
transfer of the property subject to such security agreements or
mortgages;
(vi) any restriction with respect to (x) a Restricted
Subsidiary imposed pursuant to an agreement entered into for the sale
or disposition of all or substantially all the Capital Stock or assets
of such Restricted Subsidiary or (y) an asset of a Restricted
Subsidiary pursuant to an agreement entered into for the sale or
disposition of such asset, in each case pending the closing of such
sale or disposition;
(vii) any restriction imposed by applicable law; and
(viii) any encumbrance or restriction with respect to a
Foreign Restricted Subsidiary which is contained in agreements
evidencing Indebtedness permitted under Section 6.1 hereof and which
encumbrance or restriction is customary in agreements of such type.
SECTION 6.8. Limitation on Issuance or Sale of Capital
Stock of Restricted Subsidiaries. The Company shall not (i) sell, pledge,
hypothecate or otherwise dispose of any shares of Capital Stock of a Restricted
Subsidiary (other than pledges of Capital Stock securing the Senior Credit
Facility, the Senior Secured Notes, the Third Lien Notes or the Notes) or (ii)
permit any Restricted Subsidiary, directly or indirectly, to issue or sell or
otherwise dispose of any shares of its Capital Stock other than (A) to the
Company or a Restricted Subsidiary, (B) directors' qualifying shares and shares
owned by foreign shareholders, to the extent required by applicable local laws
in foreign countries, (C) pursuant to a Qualified TIPS Transaction, (D) the
disposition of shares of a Foreign Restricted Subsidiary that is the subject of
a Permitted Foreign Transaction or (E) if, immediately after giving effect to
such issuance or sale, such Restricted Subsidiary would no longer constitute a
Subsidiary. The proceeds of any sale of such Capital Stock permitted hereby
(other than any Capital Stock received by the Company and its Restricted
Subsidiaries in connection with a Permitted Foreign Transaction) will be treated
as Net Available Cash from an Asset Disposition and must be applied in
accordance with Section 6.3.
SECTION 6.9. Merger and Consolidation. The Company shall
not consolidate with or merge with or into, or convey, transfer or lease, in one
transaction or a series of related transactions, all or substantially all its
assets to, any Person, unless:
(i) the resulting, surviving or transferee Person (the
"Successor Company") shall be a corporation organized and existing
under the laws of the United States of America, any State thereof or
the District of Columbia and the Successor Company (if
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not the Company) shall expressly assume, (a) by an instrument executed
and delivered to the Lender, in form satisfactory to the Lender, all
the obligations of the Company under the Notes and this Agreement and
(b) by an instrument (in form and substance satisfactory to the
Lender), executed and delivered to the Lender, all obligations of the
Company under the Security Documents, and shall cause such amendments,
supplements or other instruments to be filed and recorded in such
jurisdictions and take such other actions as may be required by
applicable law to preserve and protect the Lien on the Collateral owned
by or transferred to the surviving entity, together with such financing
statements as may be required to perfect any security interest in such
Collateral which may be perfected by the filing of a financing
statement under the Uniform Commercial Code of the relevant states;
(ii) immediately after giving effect to such transaction
on a pro forma basis (and treating any Indebtedness which becomes an
obligation of the Successor Company or any Subsidiary as a result of
such transaction as having been Incurred by such Successor Company or
such Subsidiary at the time of such transaction), no Default shall have
occurred and be continuing;
(iii) except in the case of a merger the sole purpose of
which is to change the Company's jurisdiction of incorporation,
immediately after giving effect to such transaction on a pro forma
basis, the Successor Company would be able to Incur an additional $1.00
of Indebtedness pursuant to Section 6.1(a) (Limitation on Incurrence of
Indebtedness);
(iv) immediately after giving effect to such transaction
on a pro forma basis, the Successor Company shall have Consolidated Net
Worth in an amount that is not less than the Consolidated Net Worth of
the Company immediately prior to such transaction; and
(v) the Company shall have delivered to the Lender an
Officers' Certificate and an opinion of counsel, each stating that such
consolidation, merger or transfer and such instruments delivered to the
Lender in connection therewith comply with this Agreement.
Notwithstanding the foregoing clauses (ii), (iii) and (iv) of
this Section 6.9, any Restricted Subsidiary may consolidate with, merge into or
transfer all or part of its properties and assets to the Company or another
Restricted Subsidiary.
The Successor Company shall be the successor to the Company
and shall succeed to, and be substituted for, and may exercise every right and
power of, the Company under this Agreement, but the predecessor Company in the
case of a conveyance, transfer or lease shall not be released from the
obligation to pay the principal of and interest on the Notes.
The Company shall not permit any Guarantor to consolidate with
or merge with or into, or convey, transfer or lease, in one transaction or a
series of transactions, all or
- 59 -
substantially all its assets to, any Person (other than the Company or a
Wholly-Owned Subsidiary), unless: (i) the resulting, surviving or transferee
Person (if not such Subsidiary) shall be a corporation organized and existing
under the laws of the United States of America, any State thereof or the
District of Columbia and the Successor Company (if not such Subsidiary) shall
expressly assume (a) by an instrument (in form and substance satisfactory to the
Lender), executed and delivered to the Lender, all of the obligations of the
Guarantor under the Guaranty and this Agreement and (b) by instrument (in form
and substance satisfactory to the Lender) executed and delivered to the Lender,
all obligations of the Guarantor under the Security Documents, and in connection
therewith shall cause such instruments to be filed and recorded in such
jurisdictions and take such other actions as may be required by applicable law
to perfect or continue the perfection of the Lien created thereunder on the
Collateral owned by or transferred to the surviving entity; (ii) immediately
after giving effect to such transaction on a pro forma basis (and treating any
Indebtedness which becomes an obligation of the resulting, surviving or
transferee Person as a result of such transaction as having been Incurred by
such Person at the time of such transaction), no Default shall have occurred and
be continuing; and (iii) the Company shall have delivered to the Lender an
Officers' Certificate and an opinion of counsel, each stating that such
consolidation, merger or transfer and such Guaranty agreement comply with this
Agreement. The provisions of clauses (i) and (iii) above shall not apply to any
transactions which constitute an Asset Disposition if the Company has complied
with the applicable provisions of Section 6.3 (Limitation on Sales of Assets and
Subsidiary Stock) hereof.
The Company shall not permit MSX Limited to consolidate with
or merge with or into, or convey, transfer or lease, in one transaction or a
series of transactions, all or substantially all its assets to, any Person
(other than the Company or a Wholly-Owned Subsidiary), unless: (i) the
resulting, surviving or transferee Person (if not such Subsidiary) shall be a
company incorporated under the laws of England and Wales and the Successor
Company (if not such Subsidiary) shall expressly assume (a) by an instrument (in
form and substance satisfactory to the Lender), executed and delivered to the
Lender, all of the obligations of MSX Limited under the MSX Limited Notes and
this Agreement and (b) by instrument (in form and substance satisfactory to the
Lender) executed and delivered to the Lender, all obligations of MSX Limited
under the Security Documents, and in connection therewith shall cause such
instruments to be filed and recorded in such jurisdictions and take such other
actions as may be required by applicable law to perfect or continue the
perfection of the Lien created thereunder on the Collateral owned by or
transferred to the surviving entity; (ii) immediately after giving effect to
such transaction on a pro forma basis (and treating any Indebtedness which
becomes an obligation of the resulting, surviving or transferee Person as a
result of such transaction as having been Incurred by such Person at the time of
such transaction), no Default shall have occurred and be continuing; and (iii)
the Company shall have delivered to the Lender an Officers' Certificate and an
opinion of counsel, each stating that such consolidation, merger or transfer and
such instrument comply with this Agreement. The provisions of clauses (i) and
(iii) above shall not apply to any transactions which constitute an Asset
Disposition if the Company has complied with the applicable provisions of
Section 6.3 (Limitation on Sales of Assets and Subsidiary Stock) hereof.
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SECTION 6.10. Waiver of Stay, Extension and Usury Laws.
Each Borrower covenants (to the extent that it may lawfully do so) that it shall
not at any time insist upon, plead, or in any manner whatsoever claim or take
the benefit or advantage of, any stay or extension law or any usury law or other
law that would prohibit or forgive the Borrowers from paying all or any portion
of the principal of, premium, if any, or interest on the Notes as contemplated
herein, wherever enacted, now or at any time hereafter in force, or which may
affect the covenants or the performance of this Agreement; and (to the extent
that it may lawfully do so) each Borrower hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not, by resort to any
such law, hinder, delay or impede the execution of any power herein granted to
the Lender, but shall suffer and permit the execution of every such power as
though no such law had been enacted.
SECTION 6.11. Limitation on Capital Expenditures. The
aggregate amount of Capital Expenditures made by the Company and its Restricted
Subsidiaries in any fiscal year shall not exceed (x) $15.0 million and (y) up to
$5 million of amounts available for Capital Expenditures and not used by the
Company and its Restricted Subsidiaries in the immediately preceding fiscal
year.
SECTION 6.12. Prohibited Transfers of Accounts Receivable.
MSX Limited shall not be permitted to transfer its Charged Assets to any
Subsidiaries that are not Guarantors.
ARTICLE 7 DEFAULTS AND REMEDIES
SECTION 7.1. Events of Default. Any of the following
events is an "Event of Default":
(i) the Borrowers default in the payment of interest on
the Loans or any other amount under this Agreement when the same
becomes due and payable, and such default continues for a period of 30
days; provided, that this Event of Default shall not limit the
Borrowers' ability to accrue interest on the Loans;
(ii) the Borrowers default in the payment of principal of
the Loans when the same becomes due and payable at their Stated
Maturity, by notice of prepayment, upon required repurchase, upon
declaration or otherwise;
(iii) the Borrowers fail to comply for 60 days after notice
with any of their obligations under Section 6.1 (Limitation on
Incurrence of Indebtedness), Section 6.4 (Limitation on Restricted
Payments), Section 6.3 (Limitation on Sales of Assets and Subsidiary
Stock) and Section 6.9 (Merger and Consolidation);
(iv) the Borrowers fail to comply with any of their other
agreements contained in this Agreement or in the other Loan Documents
and such failure continues for 60 days after the notice specified
below;
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(v) any Loan Document at any time for any reason ceases
to be in full force and effect (except as provided by the terms of this
Agreement and the other Loan Documents), or shall cease to be effective
in all material respects to give the Lender the Liens with the priority
purported to be created thereby subject to no other Liens except as
expressly permitted by the applicable Loan Document;
(vi) the Company or any of its Subsidiaries, directly or
indirectly, contests in any manner the effectiveness, validity, binding
nature or enforceability of any Loan Document;
(vii) the Company or any Restricted Subsidiary of the
Company fails to pay any Indebtedness within any applicable grace
period after final maturity or acceleration of any such Indebtedness by
the holders thereof because of a default and the total amount of such
Indebtedness unpaid or accelerated exceeds $5.0 million;
(viii) the Company, MSX Limited or any Significant
Subsidiary of the Company pursuant to or within the meaning of any
Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief against
it in an involuntary case in which it is the debtor;
(C) consents to the appointment of a Custodian of it or
for any substantial part of its property; or
(D) makes a general assignment for the benefit of
creditors; or
(E) takes any comparable action under any foreign laws
relating to insolvency;
(ix) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company, MSX
Limited or any Significant Subsidiary of the Company in an Involuntary
Case;
(B) appoints a Custodian of the Company, MSX
Limited or any Significant Subsidiary of the Company or for any
substantial part of the property of the Company or a Significant
Subsidiary; or
(C) orders the winding up or liquidation of the
Company, MSX Limited or any Significant Subsidiary;
(or any similar relief is granted under any foreign laws) and the order
or decree remains unstayed and in effect for 60 days;
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(x) the rendering of any judgment or decree for the
payment of money in excess of $5 million against the Company or a
Restricted Subsidiary if such judgment or decree remains unpaid and
outstanding for a period of 60 days following such judgment and is not
discharged, waived or stayed within 60 days after such judgment or
decree thereof; or
(xi) a Guaranty ceases to be in full force and effect
(other than in accordance with the terms of such Guaranty) or a
Guarantor denies or disaffirms its obligations under its Guaranty and
such default continues for 10 days.
The foregoing will constitute Events of Default whatever the reason for
such Event of Default and whether it is voluntary or involuntary or is effected
by the operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.
The term "Bankruptcy Law" means the Bankruptcy Code or any similar
federal or state law for the relief of debtors. The term "Custodian" means any
receiver, trustee, assignee, liquidator, custodian or similar official under any
Bankruptcy Law.
A Default under clause (iii) or (iv) of this Section 7.1 is not an
Event of Default until the Lender notifies the Company of the Default and the
Company does not cure such Default within the time specified after receipt of
such notice. Such notice must specify the Default, demand that it be remedied
and state that such notice is a "Notice of Default".
The Borrowers shall deliver to the Lender, within 15 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any Event of Default under clause (vii) of this Section 7.1 and any event which
with the giving of notice or the lapse of time would become an Event of Default
under clause (iii), (iv) or (x) of this Section 7.1, its status and what action
the Company is taking or proposes to take with respect thereto.
SECTION 7.2. Remedies. Upon the occurrence of any Event
of Default described in Section 7.1(viii) (but expressly excluding the other
Events of Default in this Article 7), the unpaid principal amount of and accrued
interest on the Loans shall automatically become immediately due and payable,
without presentment, demand, protest or other requirements of any kind, all of
which are hereby expressly waived by the Borrowers, and any obligations of the
Lender hereunder shall thereupon terminate, and (ii) upon the occurrence of any
other Event of Default, the Lender may, by written notice to the Company,
declare the Loans to be, and the same shall forthwith become, due and payable,
as specified below, together with accrued interest thereon; provided, that so
long as all Lender Obligations have not been indefeasibly paid in full, the
Commitments have not been terminated and the Senior Secured Notes and Third Lien
Notes have not been indefeasibly paid in full, the Lender will not so declare
the Loans to be due and payable under Section 7.1(iii), Section 7.1(iv) (except
with respect to any term, covenant or agreement contained in Sections 5.1, 5.2,
5.5 or 5.6), Section 7.1(ix), or Section 7.1(v) or (vi) unless and until the
Lender Obligations, Senior Secured Notes or Third Lien Notes are
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accelerated under similar provisions of the Senior Credit Facility, Senior
Secured Notes Indenture or Third Lien Loan Agreement; provided, further, that so
long as all Lender Obligations have not been indefeasibly paid in full, the
Commitments have not been terminated and the Senior Secured Notes and Third Lien
Notes have not been indefeasibly paid in full, with respect to any failure of
the Company to perform or comply in any material respect with any term, covenant
or agreement contained in Sections 5.1, 5.2, 5.5 or 5.6 the Lender may so
declare the Loans to be due and payable only after such failure shall not have
been remedied or waived within sixty (60) days after receipt of written notice
from the Lender to the Company, the Agent, the Trustee and the Third Lien Lender
of such default (other than any occurrence described in the other provisions of
this Article 7 for which a different grace or cure period is specified or which
constitutes an immediate Event of Default).
The Lender may, in addition to the remedies provided above,
and subject to the Intercreditor Agreement, exercise and enforce any and all
other rights and remedies available to it, whether arising under this Agreement
or any other Loan Document or under applicable law, in any manner deemed
appropriate by the Lender, including suit in equity, action at law, or other
appropriate proceedings, whether for the specific performance (to the extent
permitted by law) of any covenant or agreement contained in any other Loan
Document or in aid of the exercise of any power granted in any other Loan
Document.
All proceeds of any realization on the Collateral pursuant to
the Security Documents and any payments received by the Lender pursuant to the
Guaranties subsequent to and during the continuance of any Event of Default,
shall be allocated and distributed by the Lender as follows:
(A) First, to the payment of all reasonable costs and
expenses, including without limitation all reasonable attorneys' fees, of the
Lender in connection with the enforcement of the Security Documents and
otherwise administering this Agreement;
(B) Second, to the payment of all fees required to be
paid under any Loan Document owing to the Lender, for application to payment of
such liabilities;
(C) Third, to the Lender consisting of interest owing to
the Lender, for application to payment of such liabilities;
(D) Fourth, to the Lender consisting of principal owing
to the Lender, for application to payment of such liabilities;
(E) Fifth, to the payment of any and all other amounts
owing to the Lender, for application to payment of such liabilities; and
(F) Sixth, to the Borrowers, or such other Person as may
be legally entitled thereto.
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ARTICLE 8 MISCELLANEOUS
SECTION 8.1. Participations in Loans and Notes.
(a) Subject to the terms of the Intercreditor
Agreement, the Lender shall have the right at any time, with the prior written
consent of the Company, which consent from the Company shall not be unreasonably
withheld or delayed and shall not be required if any Event of Default has
occurred and is continuing or if such assignment is to an Affiliate of the
Lender, to sell, assign, transfer, or negotiate, or grant participation in, all
or any part of the Loans or Notes to one or more Persons; provided that Court
Square Capital Limited shall at all times retain at least 51% of the aggregate
principal amount of the Loans. In the case of any sale, assignment, transfer, or
negotiation of all or part of the Loans or Notes as authorized under this
Section 8.1(a), the assignee, transferee, or recipient shall have, to the extent
of such sale, assignment, transfer, or negotiation, the same rights, benefits,
and obligations as it would if it were a Lender with respect to such Loans or
Notes. Unless and Event of Default has occurred or there has been a Change of
Control of MSX Limited, any such assignments or transfers shall be made with
respect to the Company Notes and U.K. Notes on a pro rata basis based upon the
aggregate principal amount of the Notes outstanding at the time of such
assignment or transfer.
(b) In connection with any sales, assignments,
or transfers of any Loans or Notes referred to in Section 8.1(a), the Lender
shall give notice to the Company, the Agent and the Trustee of the identity of
such parties and obtain agreements from the purchasers, assignees and
transferees, as the case may be (the "Assignees"), that all information given to
such parties will be held in strict confidence pursuant to a confidentiality
agreement reasonably satisfactory to the Company. Each Borrower shall maintain a
register on which it will record the name and address of the Lender and all
Assignees and shall be entitled to treat the holder or holders of record as the
Lender for all purposes hereunder.
(c) In the event of an assignment by the Lender,
or any subsequent assignment, the term "Lender" herein shall be deemed to refer
to each such Lender, the term "Note" shall be deemed to refer to each "Note",
and any action requiring the consent of the Lender shall be deemed to require
the consent of Persons holding in excess of 50% of the outstanding principal
amount of the Notes.
SECTION 8.2. Expenses. Whether or not the transactions
contemplated hereby shall be consummated, the Borrowers agree to pay promptly,
or reimburse the Lender, as the case may be, for the payment of, on demand, (i)
all the actual and reasonable costs and expenses of preparation of the Loan
Documents and the Senior Debt Documents and all the costs of furnishing all
opinions by counsel for the Borrowers (including, without limitation, any
opinions requested by the Lender as to any legal matters arising hereunder), and
of each Borrower's performance of and compliance with all agreements and
conditions contained herein on its part to be performed or complied with
(including all stamp and other taxes and fees payable or determined to be
payable in connection with the execution, delivery, filing or recording of the
Loan Documents and the Senior Debt Documents and the consummation of the
transactions contemplated hereby and thereby, and any and all liabilities with
respect to or
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resulting from any delay in paying or omitting to pay such taxes or fees); (ii)
the reasonable fees, expenses, and disbursements of counsel to the Lender in
connection with the negotiation, preparation, execution, and administration of
the Loan Documents, the Senior Debt Documents and the Loans hereunder, and any
amendments and waivers hereto or thereto (other than assignments of, or sales of
participations in, the Notes pursuant to Section 8.1) and (iii) after the
occurrence of an Event of Default, all costs and expenses (including reasonable
attorneys' fees) incurred by the Lender in enforcing any Obligations of or in
collecting any payments due from the Borrowers hereunder or under the Notes by
reason of such Event of Default or in connection with any refinancing or
restructuring of the credit arrangements provided under this Agreement in the
nature of a workout, or any insolvency or bankruptcy proceedings.
SECTION 8.3. Indemnity. In addition to the payment of
expenses pursuant to the terms and conditions of Section 8.2 hereof, whether or
not the transactions contemplated hereby shall be consummated, each Borrower
(the "Indemnitors") agree to indemnify, pay, and hold the Lender and any holder
of the Notes, and the officers, directors, employees, agents, and Affiliates of
the Lender and such holders (collectively, the "Indemnitees") harmless from and
against any and all other liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, claims, costs, expenses and disbursements of any kind
or nature whatsoever (including, without limitation, the reasonable fees and
disbursements of one counsel for such Indemnitees in connection with any
investigative, administrative or judicial proceeding commenced or threatened,
whether or not such Indemnitee shall be designated a party thereto), which may
be imposed on, incurred by, or asserted against that Indemnitee, in any manner
relating to or arising out of this Agreement, the other Loan Documents, the
Lender's agreement to make the Loans or the use or intended use of the proceeds
of any of the Loans hereunder (the "Indemnified Liabilities"); provided, that
the Indemnitors shall not have any obligation to any Indemnitee hereunder with
respect to an Indemnified Liability to the extent that such Indemnified
Liability arises from the gross negligence or willful misconduct of any other
Indemnitee as determined by a court of competent jurisdiction. Each Indemnitee
shall give the Indemnitors prompt written notice of any claim that might give
rise to Indemnified Liabilities setting forth a description of those elements of
such claim of which such Indemnitee has knowledge; provided, that any failure to
give such notice shall not affect the obligations of the Indemnitors unless (and
then solely to the extent) the Indemnitors are materially prejudiced. The
Indemnitors shall have the right at any time during which such claim is pending
to select counsel to defend and control the defense thereof and settle any
claims for which it is responsible for indemnification hereunder (provided that
the Indemnitors will not settle any such claim without (i) the appropriate
Indemnitee's prior written consent or (ii) obtaining an unconditional release of
the appropriate Indemnitee from all claims arising out of or in any way relating
to the circumstances involving such claim) so long as in any such event, the
Indemnitors shall have stated in a writing delivered to the Indemnitee that, as
between the Indemnitors and the Indemnitee, the Indemnitors are responsible to
the Indemnitee with respect to such claim to the extent and subject to the
limitations set forth herein; provided, that the Indemnitors shall not be
entitled to control the defense of any claim in the event that in the reasonable
opinion of counsel for the Indemnitee there are one or more material defenses
available to the Indemnitee which are not available to the Indemnitors;
provided, further, that
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with respect to any claim as to which the Indemnitee is controlling the defense,
the Indemnitors will not be liable to any Indemnitee for any settlement of any
claim pursuant to this Section 8.3 that is effected without its prior written
consent. To the extent that the undertaking to indemnify, pay and hold harmless
set forth in the preceding sentence may be unenforceable because it is violative
of any law or public policy, the Borrowers shall contribute the maximum portion
which it is permitted to pay and satisfy under applicable law, to the payment
and satisfaction of all Indemnified Liabilities incurred by the Indemnitees or
any of them.
SECTION 8.4. Amendments and Waivers. No amendment,
modification, termination or waiver of any provision of this Agreement or of the
Notes, or consent to any departure by the Borrowers therefrom, shall in any
event be effective without the written concurrence of the holders of at least
51% of the principal amount of the Loans and the Borrowers and an Officers'
Certificate of the Company to the effect that such amendment, modification,
termination, or waiver does not violate the Senior Credit Agreement or the
Senior Secured Note Indenture; provided, that no amendment, modification,
waiver, or consent shall, unless in writing and signed by all the Lenders, do
any of the following: (a) increase or subject the Lender to any additional
obligations; (b) reduce the principal of, or interest on the Notes payable
hereunder pursuant to Section 2.1 or 2.2 hereof; (c) postpone any date fixed for
any payment of principal of, or premium or interest on, the Notes or any fees or
other amounts payable hereunder; or (d) amend this Section 8.4. Any waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given. No notice to or demand on the Borrowers in any
case shall entitle the Borrowers to any further notice or demand in similar or
other circumstances. Any amendment, modification, termination, waiver, or
consent effected in accordance with this Section 8.4 shall be binding upon each
holder of the Notes at the time outstanding and each future holder of the Notes.
SECTION 8.5. Independence of Covenants. All covenants
hereunder shall be given independent effect so that if a particular action or
condition is not permitted by any of such covenants, the fact that it would be
permitted by an exception to, or be otherwise within the limitation of, another
covenant shall not avoid the occurrence of an Event of Default if such action is
taken or condition exists.
SECTION 8.6. Notices. All notices, demands or other
communications to be given or delivered under or by reason of the provisions of
this Agreement shall be in writing and delivered personally, mailed by certified
or registered mail, return receipt requested and postage prepaid, sent via a
nationally recognized overnight courier, or via facsimile. Such notices, demands
and other communications will be sent to the address indicated below:
To the Company or the Borrowers:
c/o MSX International, Inc.
00000 Xxxx Xxxxxx Xxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Chief Financial Officer
Telecopy No.: (000) 000-0000
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and
c/o MSX International, Inc.
00000 Xxxx Xxxxxx Xxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: General Counsel
Telecopy No.: (000) 000-0000
with copies (which shall not
constitute notice to the Company) to:
Court Square Capital Limited
000 Xxxx Xxxxxx
00xx Xxxxx, Xxxx 4
New York, New York 10043
Attention: Xxxxxxx Xxxxxxx
Telecopy No.: (000) 000-0000
and
Dechert LLP
4000 Xxxx Atlantic Tower
0000 Xxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Telecopy No.: (000) 000-0000
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To the Lender:
c/o Court Square Capital Limited
000 Xxxx Xxxxxx
00xx Xxxxx, Xxxx 4
New York, New York 10043
Attention: Xxxxxxx Xxxxxxx
Telecopy No.: (000) 000-0000
with a copy (which shall not
constitute notice to the Lender) to:
Dechert LLP
0000 Xxxx Xxxxxxxx Tower
0000 Xxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Telecopy No.: (000) 000-0000
or such other address or to the attention of such other Person as the recipient
party shall have specified by prior written notice to the sending party;
provided, that the failure to deliver copies of notices as indicated above shall
not affect the validity of any notice. Any such communication shall be deemed to
have been received (i) when delivered, if personally delivered, or sent by
nationally-recognized overnight courier or sent via facsimile or (ii) on the
third Business Day following the date on which the piece of mail containing such
communication is posted if sent by certified or registered mail.
SECTION 8.7. Survival of Warranties and Certain
Agreements. All agreements, representations and warranties made herein shall
survive the execution and delivery of this Agreement, the making of the Loans
hereunder and the execution and delivery of the Notes and shall continue until
repayment of the Notes and the Obligations in full; provided, that if all or any
part of such payment is set aside, the representations and warranties in the
Loan Documents shall continue as if no such payment had been made.
Notwithstanding anything in this Agreement or implied by law to the contrary,
the agreements of the Borrowers set forth in Sections 8.2 and 8.3 shall survive
the payment of the Loans and the Notes and the termination of this Agreement.
SECTION 8.8. Failure or Indulgence Not Waiver; Remedies
Cumulative. No failure or delay on the part of any Lender or any holder of any
Note in the exercise of any power, right or privilege hereunder or under the
Notes shall impair such power, right or privilege or be construed to be a waiver
of any default or acquiescence therein, nor shall any single or partial exercise
of any such power, right or privilege preclude other or further exercise thereof
or of any other right, power or privilege. All rights and remedies existing
under this Agreement or the Note are cumulative to and not exclusive of, any
rights or remedies otherwise available.
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SECTION 8.9. Severability. In case any provision in or
obligation under this Agreement or the Notes shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, shall not in any way be affected or impaired thereby.
SECTION 8.10. Headings. Section and subsection headings in
this Agreement are included herein for convenience of reference only and shall
not constitute a part of this Agreement for any other purpose or be given any
substantive effect.
SECTION 8.11. Applicable Law. THIS AGREEMENT AND THE NOTES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICT OF LAWS TO
THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY. MSX LIMITED HAS IRREVOCABLY APPOINTED THE COMPANY AS ITS
AUTHORIZED AGENT UPON WHICH PROCESS MAY BE SERVED IN ANY SUCH SUIT OR
PROCEEDING, AND AGREES THAT SERVICE OF PROCESS UPON SUCH AGENT, AND WRITTEN
NOTICE OF SAID SERVICE TO MSX LIMITED, BY THE PERSON SERVING THE SAME TO MSX
INTERNATIONAL, INC., 00000 XXXX XXXXXX XXXX XXXX XXXXXXXXXX, XX 00000-0000,
SHALL BE DEEMED IN EVERY RESPECT TO EFFECT SERVICE OF PROCESS UPON MSX LIMITED
IN ANY SUCH SUIT OR PROCEEDING.
SECTION 8.12. Successors and Assigns; Subsequent Holders
of Notes. This Agreement shall be binding upon the parties hereto and their
respective successors and assigns and shall inure to the benefit of the parties
hereto and the successors and assigns of the Lender. The terms and provisions of
this Agreement and all other certificates delivered pursuant to Article 3 shall
inure to the benefit of any assignee or transferee of the Notes pursuant to
Section 8.1(a), and in the event of such transfer or assignment, the rights and
privileges herein conferred upon the Lender shall automatically extend to and be
vested in such transferee or assignee, all subject to the terms and conditions
hereof. The Borrowers' rights or any interest therein hereunder may not be
assigned without the written consent of the Lender.
SECTION 8.13. Consent to Jurisdiction and Service of
Process. THE BORROWERS AGREE THAT ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO
ANY LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY MAY BE BROUGHT IN ANY
COURT OF THE STATE OF NEW YORK LOCATED IN THE CITY OF NEW YORK, OR IN ANY COURT
OF THE UNITED STATES OF AMERICA SITTING IN NEW YORK LOCATED IN THE CITY OF NEW
YORK, AND THE BORROWERS HEREBY SUBMIT TO AND ACCEPT GENERALLY AND
UNCONDITIONALLY THE JURISDICTION OF THOSE COURTS WITH RESPECT TO ITS PERSON AND
PROPERTY AND, TO THE EXTENT PERMITTED BY LAW, IRREVOCABLY AGREES TO BE BOUND BY
ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS AGREEMENT SUBJECT,
HOWEVER, TO RIGHTS OF
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APPEAL. THE BORROWERS FURTHER IRREVOCABLY CONSENT TO THE SERVICE OF PROCESS IN
CONNECTION WITH ANY SUCH ACTION OR PROCEEDING BY PERSONAL DELIVERY TO THE
COMPANY OR BY THE MAILING THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE
PREPAID TO THE COMPANY AT ITS ADDRESS AS PROVIDED PURSUANT TO SECTION 8.6.
NOTHING IN THIS PARAGRAPH SHALL AFFECT THE RIGHT OF THE LENDERS TO SERVE PROCESS
IN ANY OTHER MANNER PERMITTED BY LAW OR LIMIT THE RIGHT OF THE LENDERS TO BRING
ANY SUCH ACTION OR PROCEEDING AGAINST THE BORROWERS OR THEIR PROPERTY IN THE
COURTS OF ANY OTHER JURISDICTION. THE BORROWERS HEREBY IRREVOCABLY WAIVE ANY
OBJECTION TO THE LAYING OF VENUE OF ANY SUCH SUIT OR PROCEEDING IN THE ABOVE
DESCRIBED COURTS.
SECTION 8.14. Waiver of Jury Trial. EACH BORROWER AND EACH
LENDER HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, TRIAL BY JURY
IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING
OUT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE VALIDITY, PROTECTION,
INTERPRETATION, COLLECTION OR ENFORCEMENT THEREOF. NOTWITHSTANDING ANYTHING
CONTAINED IN THIS AGREEMENT TO THE CONTRARY, NO CLAIM MAY BE MADE BY THE
BORROWERS OR ANY LENDER AGAINST ANY LENDER FOR ANY LOST PROFITS OR ANY SPECIAL,
INDIRECT OR CONSEQUENTIAL DAMAGES IN RESPECT OF ANY BREACH OR WRONGFUL CONDUCT
(OTHER THAN WILLFUL MISCONDUCT CONSTITUTING ACTUAL FRAUD) IN CONNECTION WITH,
ARISING OUT OF OR IN ANY WAY RELATED TO THE TRANSACTIONS CONTEMPLATED HEREUNDER
OR UNDER THE OTHER LOAN DOCUMENTS, OR ANY ACT, OMISSION OR EVENT OCCURRING IN
CONNECTION THEREWITH. EACH BORROWER AND EACH LENDER HEREBY WAIVES, RELEASES AND
AGREES NOT TO XXX UPON ANY SUCH CLAIM FOR ANY SUCH DAMAGES. EACH BORROWER AND
EACH LENDER AGREES THAT THIS SECTION IS A SPECIFIC AND MATERIAL ASPECT OF THIS
AGREEMENT AND ACKNOWLEDGES THAT THE LENDER WOULD NOT EXTEND TO THE BORROWERS ANY
LOANS HEREUNDER IF THIS SECTION WERE NOT PART OF THIS AGREEMENT.
SECTION 8.15. Counterparts; Effectiveness. This Agreement
and any amendments, waivers, consents, or supplements 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, but
all such counterparts together shall constitute but one and the same instrument.
This Agreement shall become effective upon the execution of a counterpart hereof
by each of the parties hereto, and written or telephonic notification of such
execution and authorization of delivery thereof has been received by the Company
and the Lender.
SECTION 8.16. Entirety. This Agreement and the other Loan
Documents embody the entire agreement among the parties and supersede all prior
agreements and understandings, if any, relating to the subject matter hereof and
thereof.
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SECTION 8.17. Confidentiality. The Lender shall keep any
information delivered or made available by the Borrowers or the Guarantors to it
confidential from anyone other than persons employed or retained by the Lender
who are expected to become engaged in evaluating, approving, structuring or
administering the Loan; provided that nothing herein shall prevent the Lender
from disclosing such information (a) to any other Person if reasonably
incidental to the administration of the Loan, (b) upon the order of any court or
administrative agency or otherwise required by law, (c) upon the request or
demand of any regulatory agency or authority, (d) which had been publicly
disclosed other than as a result of a disclosure by the Lender prohibited by
this Agreement, (e) in connection with any litigation to which the Lender or its
subsidiaries or parent corporation may be a party, (f) to the extent necessary
in connection with the exercise of any remedy hereunder, (g) to the Lender's
legal counsel and independent auditors and (h) subject to a confidentiality
agreement containing provisions substantially similar to those contained in this
Section made for the benefit of the Borrowers by such actual or proposed
participation in or assignee of any Indebtedness incurred hereunder, to any
actual or proposed participate or assignee of any of the Indebtedness incurred
hereunder.
SECTION 8.18. Conversion of Currency. The Borrowers and
the Guarantors covenant and agree that the following provisions shall apply to
conversion of currency in the case of the Notes and this Agreement:
(a) If for the purpose of obtaining judgment in,
or enforcing the judgment of, any court in any country, it becomes necessary to
convert into any other currency (the "judgment currency") an amount due in U.S.
dollars, then the conversion shall be caused by the Borrowers and the Guarantors
to be made at the rate of exchange prevailing on the Business Day before the day
on which the judgment is given or the order of enforcement is made, as the case
may be (unless a court shall otherwise determine).
(b) The term "rate(s) of exchange" shall mean
the rate at which the Borrowers or their agent bank located in the City of New
York, as the case may be, are able or would have been able on the relevant date
to purchase U.S. dollars with the judgment currency other than U.S. dollars
referred to in subsections (a) above and includes any costs of exchange payable
to such bank in connection with such exchange.
(c) This is an international financing
transaction in which the specification of U.S. dollars and payment in New York,
New York, is of the essence, and U.S. dollars shall be the currency of account
in all events. The obligation of the Borrowers and Guarantors in respect of any
sum due from them to the Lender hereunder or under a Note shall, notwithstanding
any judgment in a currency other than U.S. dollars, be discharged only to the
extent that on the Business Day following receipt by the Lender of any sum
adjudged to be so due in such other currency the Lender purchases U.S. dollars
with such other currency; if the U.S. dollars so purchased are less than the sum
originally due to the Lender in U.S. dollars, the Company and subsidiary
Guarantors with respect to the Company Notes, and MSX Limited and the Guarantors
with respect to the U.K. Notes, agree, as a separate obligation and
notwithstanding any such judgment, to indemnify the Lender against such loss,
and if the U.S.
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dollars so purchased exceed the sum originally due to the Lender in U.S.
dollars, the Lender agrees to remit to the Borrowers such excess.
SECTION 8.19. Acknowledgments. Each Borrower hereby
acknowledges that:
(a) it has been advised by counsel in the
negotiation, execution and delivery of this Agreement and the other Loan
Documents;
(b) the Lender has no fiduciary relationship
with or duty to the Borrowers arising out of or in connection with this
Agreement or any of the other Loan Documents, and the relationship between the
Lender, on the one hand, and the Borrowers, on the other hand, in connection
herewith or therewith is solely that of debtor and creditor; and
(c) no joint venture is created hereby or by the
other Loan Documents or otherwise exists by virtue of the transactions
contemplated hereby between the Lender and the Borrowers.
SECTION 8.20. Reaffirmation; Release.
(a) Each of the Borrowers and the Lender hereby
ratifies, affirms and reaffirms in all respects its obligations and undertakings
under each Loan Document (including without limitation, the Security Documents)
to which it is a party, including without limitation, all terms, conditions,
representations and covenants in each of the Loan Documents (as applicable) and
agrees that all references therein to the Loan Agreement shall be deemed to
refer to the Loan Agreement as amended and restated by this Agreement.
(b) Each of the Borrowers and the Lender hereby
acknowledges (i) the continued existence, validity and enforceability of each
Loan Document (including without limitation, the Security Documents) to which it
is a party, and agrees that the terms and conditions, representations and
covenants of each such Loan Document are binding upon it and (ii) subsequent to,
and after taking into account of all the terms and conditions of this Agreement,
each Loan Document (including without limitation, the Security Documents) is and
shall remain in full force and effect in accordance with the terms thereof.
(c) Each Borrower represents and warrants that
it is not aware of any claims or causes of action against the Lender or any of
its successors or assigns arising from or in any way related to this Agreement,
the Original Agreement or any of the other Loan Documents. NOTWITHSTANDING THIS
REPRESENTATION AND AS FURTHER CONSIDERATION FOR THE AGREEMENTS AND
UNDERSTANDINGS HEREIN, EACH BORROWER, ON BEHALF OF ITSELF AND ITS EMPLOYEES,
AGENTS, EXECUTORS, HEIRS, SUCCESSORS AND ASSIGNS, HEREBY RELEASES THE LENDER,
ITS PREDECESSORS, OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ATTORNEYS, AFFILIATES,
SUBSIDIARIES, SUCCESSORS AND ASSIGNS, FROM ANY LIABILITY, CLAIM, RIGHT OR CAUSE
OF ACTION WHICH NOW EXISTS OR HEREAFTER ARISES AS A RESULT OF ACTS, OMISSIONS OR
EVENTS OCCURRING ON OR PRIOR TO THE
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DATE HEREOF, WHETHER KNOWN OR UNKNOWN, ARISING FROM OR IN ANY WAY RELATED TO
THIS AGREEMENT, THE ORIGINAL AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS.
* * * * *
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IN WITNESS WHEREOF the due execution hereof by the respective
duly authorized officers of the undersigned as of the date first written above.
MSX INTERNATIONAL, INC.
By: /s/ Xxxxxxxxx X. Xxxxxxx
-------------------------------
Name: Xxxxxxxxx X. Xxxxxxx
Title: Vice President
MSX INTERNATIONAL LIMITED
By: /s/ Xxxxxxxxx X. Xxxxxxx
-------------------------------
Name: Xxxxxxxxx X. Xxxxxxx
Title: Director
COURT SQUARE CAPITAL LIMITED
By: /s/ Xxxxxxx Xxxxxxx
-------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
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