EXHIBIT 10.1
[CONFORMED COPY]
U.S. $250,000,000
AMENDED AND RESTATED CREDIT AGREEMENT,
dated as of April 14, 1997
(amending and restating the Credit Agreement
dated as of January 9, 1997),
among
ADT OPERATIONS, INC.,
as the Borrower,
and
CERTAIN COMMERCIAL LENDING INSTITUTIONS,
as the Lenders,
and
THE BANK OF NOVA SCOTIA,
as the Agent for the Lenders.
AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT, dated as of April 14, 1997
(amending and restating the Credit Agreement dated as of January 9, 1997),
among ADT OPERATIONS, INC., a Delaware corporation (the "Borrower"), the
various financial institutions as are or may become parties hereto
(collectively, the "Lenders"), and THE BANK OF NOVA SCOTIA ("Scotiabank"),
individually and as agent (the "Agent") for the Lenders,
W I T N E S S E T H:
WHEREAS, the Borrower and its affiliates are engaged principally in the
electronic security services business and the vehicle auction business;
WHEREAS, the Borrower, The Bank of Nova Scotia, as Lender (the "Initial
Lender"), and the Agent are parties to the Existing Credit Agreement (as
hereinafter defined) pursuant to which the Initial Lender has agreed to
provide financing for general corporate purposes;
WHEREAS, the Borrower has requested, among other things, that the
Revolving Loan Commitment Amount (as defined in the Existing Credit Agreement)
be increased from $200,000,000 to $250,000,000 and that the Existing Credit
Agreement be amended to read in its entirety as set forth herein;
WHEREAS, the Borrower, the Initial Lender and the Agent desire to
allocate the Revolving Loan Commitment Amount, as so increased, among the
Lenders in the Percentages (as hereinafter defined) set forth herein; and
WHEREAS, the Lenders and the Issuers are willing, on the terms and
subject to the conditions hereinafter set forth, to so increase and allocate
such Revolving Loan Commitment Amount and amend the Existing Credit Agreement;
NOW, THEREFORE, the parties hereto hereby amend and restate the Existing
Credit Agreement to read in its entirety as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following
meanings (such meanings to be equally applicable to the singular and plural
forms thereof):
"ADT Automotive" means ADT Automotive Holdings, Inc. (formerly known as
ADT Auctions, Inc.), a Delaware corporation and Wholly Owned Subsidiary of the
Borrower.
"ADT Finance Inc." means ADT Finance Inc., a Canadian corporation.
"ADT Limited" means ADT Limited, a company organized under the laws of
Bermuda.
"ADT Limited Guaranty" means that certain Guaranty executed and
delivered by ADT Limited pursuant to the Existing Credit Agreement, dated as
of January 9, 1997, a conformed copy of which is attached as Exhibit I hereto,
as the same may be amended, supplemented, amended and restated or otherwise
modified from time to time.
"ADT Security Services" means ADT Security Services, Inc. (formerly
known as ADT Security Systems, Inc.), a Delaware corporation.
"Affiliate" of any Person means any other Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any Plan). A Person shall be deemed to "control" another
Person if such Person possesses, directly or indirectly, power
(a) to vote 10% or more of the securities (on a fully diluted basis)
having ordinary voting power for the election of directors or managing
general partners; or
(b) to direct or cause the direction of the management and policies of
such other Person whether by contract or otherwise.
"Agent" is defined in the preamble and includes each other Person as
shall have subsequently been appointed as a successor Agent pursuant to
Section 10.4.
"Agreement" means (a) on any date on or subsequent to the Amendment
Effective Date, this Amended and Restated Credit Agreement as originally in
effect on the Amendment Effective Date and as thereafter from time to time
amended, supplemented, amended and restated or otherwise modified and in
effect on such date and (b) on any date prior to the Amendment Effective Date,
the Existing Credit Agreement.
"Alternate Base Rate" means, on any date and with respect to all Base
Rate Loans, a fluctuating rate of interest per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to the higher of
(a) the Prime Rate in effect for such day; and
(b) the Federal Funds Effective Rate in effect for such day plus 1/2
of 1%.
For purposes hereof:
"Federal Funds Effective Rate" means, for any day, a fluctuating rate
of interest per annum equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published on the succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate
is not so published for any day which is a Business Day, the average of
the quotations for the day of such transactions received by the Agent
from three Federal funds brokers of recognized standing selected by it.
"Prime Rate" means the rate of interest per annum publicly announced by
the Agent from time to time as its prime rate in effect at its principal
office in New York City. The Prime Rate is not intended to be the
lowest rate of interest charged by the Agent in connection with
extensions of credit to debtors.
If for any reason the Agent shall have determined (which determination shall
be conclusive absent manifest error) that it is unable to ascertain the
Federal Funds Effective Rate for any reason, including the inability or
failure of the Agent to obtain sufficient quotations in accordance with the
terms hereof, the Alternate Base Rate shall be determined without regard to
clause (b) until the circumstances giving rise to such inability no longer
exist. Any change in the Alternate Base Rate due to a change in the Prime
Rate or the Federal Funds Effective Rate shall be effective as of the opening
of business on the date of such change.
"Amendment Agreement" means the Amendment and Assignment Agreement,
dated as of April 14, 1997, among the parties hereto.
"Amendment Effective Date" means the date this Agreement becomes
effective pursuant to the term and conditions of the Amendment Agreement.
"ASH" means Automated Security (Holdings) PLC.
"ASH Acquisition Date" means September 6, 1996.
"Asset Sale" is defined in Section 4.2.10 of the ADT Limited Guaranty.
"Assignee Lender" is defined in Section 11.11.1.
"Auction Business Intercompany Debt" means, with respect to any
Permitted Auction Business Sale, the net amount (if any) owed to the Borrower
or to any Subsidiary of the Borrower (other than such a Subsidiary the Capital
Stock of which, or all or substantially all of the assets of which, are sold
pursuant to such Permitted Auction Business Sale or any Subsidiary of any such
Subsidiary) by any Subsidiary of the Borrower the Capital Stock of which, or
all or substantially all of the assets of which, are sold pursuant to a
Permitted Auction Business Sale.
"Authorized Officer" means, relative to any Obligor, those of its
officers whose signatures and incumbency shall have been certified to the
Agent and the Lenders pursuant to Section 4.2 of the Amendment Agreement.
"Base Rate Loan" means a Loan bearing interest at a fluctuating rate
determined by reference to the Alternate Base Rate.
"Borrower" is defined in the preamble.
"Borrowing" means, as the context may require, either a Competitive Bid
Loan Borrowing or a Revolving Loan Borrowing.
"Borrowing Request" means, as the context may require, either a
Revolving Loan Borrowing Request or a Competitive Bid Loan Borrowing Request.
"Business Day" means any day
(a) which is neither a Saturday or Sunday nor a legal holiday on which
banks are authorized or required to be closed in New York City and
(b) relative to the making, continuing, prepaying or repaying of any
LIBO Rate Loans, on which dealings in Dollars are carried on in the
London interbank market.
"Capital Expenditures" means, with respect to any Person for any period,
the sum (without duplication) of
(a) the excess of (i) the aggregate amount of all expenditures of such
Person and its Subsidiaries for fixed or capital assets made during such
period which, in accordance with GAAP, would be classified as capital
expenditures over (ii) the aggregate amount of net cash proceeds of
Excluded Dispositions received by the Borrower, ADT Limited or any other
Subsidiary of ADT Limited during such period;
plus
(b) the aggregate amount of all Capitalized Lease Liabilities of such
Person incurred during such period;
provided, however, that the Capital Expenditures of any Person for any period
that would include a Pre-Acquisition Period will not include any Capital
Expenditures made by ASH or any of its Subsidiaries during such
Pre-Acquisition Period.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated) of such
Person's capital stock or equity, whether now outstanding or issued after the
date hereof, including all common stock, preferred stock, partnership
interests and member interests.
"Capitalized Lease Liabilities" means, with respect to any Person, all
monetary obligations of such Person or any of its Subsidiaries under any
leasing or similar arrangement which, in accordance with GAAP, would be
classified as capitalized leases, and, for purposes of this Agreement and each
other Loan Document, the amount of such obligations shall be the capitalized
amount thereof, 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.
"Cash Equivalent Investment" means, at any time:
(a) any evidence of Indebtedness, with a maturity of 180 days or less,
issued or directly and fully guaranteed by the United States Government;
(b) commercial paper, with a maturity of 180 days or less, which is
issued by
(i) a corporation (other than an Affiliate of any Obligor)
organized under the laws of any state of the United States or of the
District of Columbia and rated A-1 or better by Standard & Poor's or
P-1 or better by Xxxxx'x, or
(ii) any Lender (or its holding company);
(c) any certificate of deposit or bankers acceptance, with a maturity
of 180 days or less, which is issued by either
(i) a commercial banking institution that is organized under
the laws of Canada, is a member of the Federal Reserve System or
is subject to regulation by the F.R.S. Board, and has a combined
capital and surplus and undivided profits of not less than
$500,000,000 (or the equivalent thereof in other currencies) and
(x) whose short term obligations are rated, at the time as of
which any such investment is made, A-1 or better by Standard &
Poor's or P-1 or better by Xxxxx'x or (y) whose debt is rated, at
the time as of which any investment therein is made, A or better
by Standard & Poor's or A or better by Xxxxx'x, or
(ii) any Lender; or
(d) any money market deposit accounts issued or offered by any
commercial banking institution of the stature referred to in clause
(c)(i).
"Cash Flow" means, with respect to any Person for any applicable period,
the excess of
(a) EBITDA of such Person and its Subsidiaries for such period;
over
(b) the sum for such period of
(i) all taxes computed on the basis of income (whether local,
foreign or otherwise), to the extent paid in cash by such Person
and its Subsidiaries on a consolidated basis during such period;
plus
(ii) Capital Expenditures (other than Capital Expenditures
incurred in respect of any Business Acquisition permitted under
Section 4.2.5 or 4.2.9 of the ADT Limited Guaranty) of such Person
and its Subsidiaries paid by such Person and its Subsidiaries
during such period;
provided, however, that the Cash Flow of any Person for any period that would
include a Pre-Acquisition Period will not include any item that would be
included in the determination of the Cash Flow of ASH for such Pre-Acquisition
Period.
"Cash Flow Coverage Ratio" means, with respect to any Person at the end
of any Fiscal Quarter, the ratio computed for the period of four consecutive
Fiscal Quarters ending on the close of such Fiscal Quarter of
(a) Cash Flow of such Person and its Subsidiaries for such period plus,
to the extent deducted in determining such Cash Flow, Capital
Expenditures of such Person and its Subsidiaries paid by such Person and
its Subsidiaries during such period with Equity Proceeds, so long as the
Compliance Certificate (including any compliance certificate delivered
under the Existing Credit Facility) delivered in connection with the
Fiscal Quarter in which such Capital Expenditures were paid indicated
that such Capital Expenditures were paid with Equity Proceeds and that
the aggregate amount of such Capital Expenditures did not exceed the
Equity Proceeds Amount (as determined immediately prior to the making of
such Capital Expenditures);
to
(b) Interest Expense of such Person and its Subsidiaries for such
period;
provided, however, that the Cash Flow Coverage Ratio with respect to any
Person for any period that would include a Pre-Acquisition Period will not
include any item that would be included in the determination of the Cash Flow
Coverage Ratio with respect to ASH for such Pre-Acquisition Period.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
Liability Information System List.
"Change in Control" means
(a) an event (including any event arising out of any transaction or
proposed transaction announced or contemplated on or prior to the date
hereof) as a result of which
(i) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Exchange Act) is or becomes the direct or
indirect "beneficial owner" (as defined in Rules 13d-3 and 13d-5
under the Exchange Act) of more than 35% of the Voting Stock of
ADT Limited; or
(ii) during any period of three consecutive years, beginning on or
after the Indenture Effective Date, individuals who either (A)
were members of the Board of Directors of ADT Limited at the
beginning of such period or (B) whose election by the Board of
Directors of ADT Limited or whose nomination for election by
the shareholders of ADT Limited was approved by a vote of 66
2/3% of the directors then still in office who were either
directors at the beginning of such period or whose election or
nomination for election was previously approved as provided for
in this subclause (ii)(B) cease for any reason (including as a
result of any proxy contest involving the solicitation of
revocable proxies under Section 14(a) of the Exchange Act) to
constitute a majority of such Board of Directors; or
(iii) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Exchange Act) possesses, directly or indirectly,
the legal right to direct the management and policies of ADT
Limited, whether through the ownership of securities, by contract
or otherwise (other than solely by virtue of membership on the
Board of Directors of ADT Limited or any committee thereof); or
(b) the failure of ADT Limited to own, directly or indirectly, free and
clear of all Liens or other encumbrances (other than Liens created
pursuant to the Loan Documents), 100% of the outstanding Voting Stock on
a fully diluted basis of the Borrower.
"Closing Date" means January 14, 1997, the date upon which all of the
conditions set forth in Section 6.1 of the Existing Credit Agreement were
satisfied.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commitment Letter" means the letter dated December 31, 1996, from
Scotiabank to the Borrower, relating to this Agreement.
"Commitment Termination Event" means
(a) the occurrence with respect to the Borrower or ADT Limited of any
Event of Default described in clause (b) or (d) of Section 9.1.9; or
(b) the occurrence and continuance of any other Event of Default and
either
(i) the declaration of all outstanding Loans and other Obligations to
be due and payable pursuant to Section 9.3, or
(ii) in the absence of such declaration, the giving of notice by the
Agent, acting at the direction of the Required Lenders, to the
Borrower that the Revolving Loan Commitments have been
terminated.
"Common Shares" means the shares of common stock, par value $0.10 per
share, of ADT Limited.
"Competitive Bid Loan" means a Loan made by a Lender to the Borrower as
part of a Competitive Bid Loan Borrowing resulting from the procedures
described in Section 2.3.
"Competitive Bid Loan Acceptance" means an acceptance by the Borrower of
a Competitive Bid Loan Offer pursuant to Section 2.3.5, substantially in the
form of Exhibit D-3 attached hereto.
"Competitive Bid Loan Borrowing" means Competitive Bid Loans made by
each of the Lenders whose offer to make such Competitive Bid Loans as part of
such Borrowing has been accepted by the Borrower pursuant to Section 2.3.5.
"Competitive Bid Loan Borrowing Request" means a certificate requesting
Competitive Bid Loans, duly executed by an Authorized Officer, substantially
in the form of Exhibit C-2 attached hereto.
"Competitive Bid Loan Interest Payment Date" is defined in clause (f) of
Section 3.2.3.
"Competitive Bid Loan Maturity Date" is defined in Section 2.3.1.
"Competitive Bid Loan Note" means a promissory note of the Borrower
payable to any Lender, in the form of Exhibit B hereto (as such promissory
note may be amended, endorsed or otherwise modified from time to time),
evidencing the aggregate Indebtedness of the Borrower to such Lender resulting
from Loans outstanding from such Lender that were made as Competitive Bid
Loans, and also means all other promissory notes accepted from time to time in
substitution therefor or renewal thereof.
"Competitive Bid Loan Offer" means an offer by a Lender to make a
Competitive Bid Loan pursuant to Section 2.3.3, substantially in the form of
Exhibit D-2 attached hereto.
"Competitive Bid Outstanding Balance" means, at any time, the then
aggregate outstanding principal amount of all Competitive Bid Loans.
"Competitive Bid Rate" means the LIBO Rate (plus (or minus) the LIBO
Rate Bid Margin) offered by a Lender in a Competitive Bid Loan Offer in
respect of a Competitive Bid Rate Loan proposed pursuant to Section 2.3.
"Compliance Certificate" means a certificate substantially in the form
of Exhibit H hereto.
"Contingent Liability" means any agreement, undertaking or arrangement
by which any Person guarantees, endorses or otherwise becomes or is
contingently liable upon (by direct or indirect agreement, contingent or
otherwise, to provide funds for payment, to supply funds to, or otherwise to
invest in, a debtor, or otherwise to assure a creditor against loss) the
indebtedness, obligation or any other liability of any other Person (other than
by endorsements of instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of any other
Person. The amount of any Person's obligation under any Contingent Liability
shall (subject to any limitation set forth therein) be deemed to be the
outstanding principal amount (or maximum principal amount, if larger) of the
debt, obligation or other liability guaranteed thereby.
"Continuation/Conversion Notice" means a notice of continuation or
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of Exhibit F hereto.
"Controlled Group" means all members of a controlled group of
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with the
Borrower, are treated as a single employer under Section 414(b) or 414(c) of
the Code or Section 4001 of ERISA.
"Core Business" means any business directly related to
(a) until such time as ADT Limited and its Subsidiaries no longer
engage in any of the businesses described in this clause (a) (whether
pursuant to one or more Permitted Auction Business Sales or otherwise),
the auctioning or other distribution of
(i) vehicles held on a consignment or similar basis and
(ii) equipment which is similarly held on a consignment or similar
basis and which is related to the auctioning and distribution of
vehicles, including equipment related to the repair and
refurbishing of vehicles,
(x) exclusive, in the case of both preceding clauses (i) and (ii), of
the purchasing of items for resale (other than purchases incidental and
customary in the conduct of such business and which when added to
amounts expended in respect of all other items so purchased and still
owned (including pursuant to the conduct of any Related Business) would
not exceed $5,000,000), but (y) inclusive, in the case of the preceding
clause (i), of (1) any guaranteed residual equipment program pursuant to
which ADT Automotive or any of its Affiliates organized and conducting
its activities in the United States guarantees to a consignor of a
vehicle to be auctioned by ADT Automotive or any such Affiliate a
minimum return on such vehicle, provided that the maximum aggregate
amount of such guarantees at any one time outstanding does not exceed
$10,000,000 and (2) any short-term financing of dealer purchases of
vehicles auctioned by ADT Automotive or any of its Affiliates
organized and conducting its activities in the United States to the
extent the aggregate amount outstanding at any one time pursuant to
such financing does not exceed $40,000,000, certificates of title to
such vehicles are held by ADT Automotive or such Affiliates providing
such financing and such financing is otherwise consistent with terms
given to similar dealers by vehicle auctioneers in the ordinary
course of their business,
(b) until such time as ADT Limited and its Subsidiaries no longer
engage in any of the businesses described in clause (a) above or in any
Related Business, any Related Business or
(c) services with respect to the transmission or monitoring of
information regarding the security or condition of property and any
additional information services provided through facilities used for
such transmission or monitoring.
"Covenant Termination Date" means the date on which each of the
following has occurred:
(a) all Revolving Loan Commitments have terminated,
(b) all principal of, and interest on, all Loans has been paid in full,
(c) all fees under Section 3.3 have been paid in full,
(d) all Letters of Credit have expired or been terminated,
(e) all Reimbursement Obligations (including all interest thereon) have
been paid in full, and
(f) all other fees and expenses hereunder invoiced to the Borrower and
exceeding $3,000,000 in the aggregate have been paid in full.
"Credit Extension" means and includes
(a) the advancing of any Loan by any Lender in connection with a
Borrowing, and
(b) the issuance, extension or renewal by any Issuer of any Letter of
Credit.
"Debt" means, with respect to any Person, the sum (without duplication)
of (i) the outstanding and stated principal amount (or, in the case of
Redeemable Capital Stock, the liquidation preference) of the Indebtedness of
such Person of the nature referred to in clauses (a), (b) (other than
obligations relative to letters of credit in support of trade obligations with
an aggregate face amount not exceeding $250,000 at any time outstanding), (c)
and (g) of the definition of "Indebtedness" and (ii) any Contingent
Liabilities of such Person in respect of any type of Indebtedness described in
the preceding clause (i); provided that the amount of any Debt that is issued
at a price that is less than the stated principal amount thereof shall be
equal to the amount of the liability in respect thereof determined in
accordance with GAAP.
"Debt to Total Capitalization Ratio" means, with respect to any Person,
the ratio of
(a) Debt of such Person and its Subsidiaries, determined on a
consolidated basis,
to
(b) Total Capitalization of such Person.
"Default" means any Event of Default or any condition, occurrence or
event which, after notice or lapse of time or both, would constitute an Event
of Default.
"Disbursement Date" is defined in Section 4.5(a).
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
Schedule I, as it may be amended, supplemented or otherwise modified from time
to time by the Borrower with the written consent of the Agent and the Required
Lenders.
"Dividended Note" means (i) the promissory note of ADT Security
Services, payable to the Borrower in the principal amount of $432,214,964.80,
which note was dividended by the Borrower to Holdings Inc. on December 31,
1996, in the form of an assignment thereof, together with (ii) the
Subordination Agreement dated as of January 9, 1997, among ADT Security
Services, ADT Group plc (an indirect assignee of the rights of Holdings Inc.
under the Dividended Note) and the Agent.
"Dollar" and the sign "$" mean lawful money of the United States.
"Domestic Office" means, relative to any Lender, the office of such
Lender designated as such below its signature hereto or designated in the
Lender Assignment Agreement or such other office of a Lender (or any successor
or assign of such Lender) within the United States as may be designated as
such from time to time by notice from such Lender to the Borrower and the
Agent.
"EBITDA" means, with respect to any Person for any applicable period,
Net Income for such Person and its Subsidiaries for such period (excluding
therefrom (x) the effect of any extraordinary or other non-recurring gain
outside the ordinary course of business and (y) any write-up in the value of
any asset) plus, to the extent deducted in determining such Net Income for
such period, the aggregate amount of (i) Interest Expense, (ii) taxes computed
on the basis of income (whether local, foreign or otherwise), (iii) the
aggregate amount of depletion, depreciation and amortization of tangible and
intangible assets, including amortization of debt issuance costs and other
financing expenses incurred (A) prior to the Effective Date or (B) in
connection with entering into this Agreement and the other Loan Documents and
(iv) without duplication, any write-off of the costs and expenses referred to
in the preceding clause (iii); provided, however, that the EBITDA of any
Person for any period that would include a Pre-Acquisition Period will not
include any item that would be included in the determination of the EBITDA of
ASH for such Pre-Acquisition Period.
"Effective Date" means January 9, 1997, the date the Existing Credit
Agreement became effective pursuant to Section 11.8 thereof.
"Environmental Laws" means all applicable federal, state or local
statutes, laws, ordinances, codes, rules, regulations and guidelines
(including consent decrees and administrative orders) relating to public
health and safety and protection of the environment.
"Equity Proceeds" means the cash proceeds referred to in clause (a) of
the definition of "Equity Proceeds Amount" in the ADT Limited Guaranty.
"Equity Proceeds Amount" is defined in Section 1.1 of ADT Limited
Guaranty.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time.
References to sections of ERISA also refer to any successor sections.
"Event of Default" is defined in Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchangeable Preference Shares" means the Exchangeable Cumulative
Redeemable Preference Shares 2005, par value $1.00 per share, of ADT Limited.
"Excluded Disposition" means any Asset Sale (a) of (i) motor vehicles
purchased by the Borrower, ADT Limited or any other Subsidiary of ADT Limited
for use in the ordinary course of its business (and not for purposes of
resale) and (ii) real estate that was previously used in the operations of any
auto auction site, which operations have not produced any revenue in the 12
months prior to such transfer, or that was originally acquired in connection
with the development or proposed development of any auto auction site or real
estate consisting of any portion of any auto auction site that is not used in
connection with the operations of such auto auction site (in each case,
"Auction Real Estate") to the extent that, after giving effect to such
transfers, the aggregate Fair Market Value of all such Auction Real Estate
transferred in any Fiscal Year does not exceed $10,000,000 in the aggregate
and (b) the proceeds of which are within 12 months (or, in the case of Auction
Real Estate, 18 months) after such Asset Sale invested in assets and
properties to replace the assets and properties that were the subject of
such Asset Sale or in assets and properties that will be used in the Core
Businesses.
"Existing Credit Agreement" means the Credit Agreement, dated as of
January 9, 1997, among the Borrower, the Lenders and Scotiabank, as agent for
the Lenders, as in effect immediately prior to the effectiveness of this
Agreement pursuant to the Amendment Agreement.
"Existing Credit Facility" means the Credit Agreement, dated as of
August 23, 1995 (as amended or otherwise modified), among the Borrower, the
various financial institutions party thereto, The Bank of Nova Scotia, as
Documentation Agent, and Chemical Bank, as Administrative Agent.
"Existing Letter of Credit" is defined in Section 4.1.
"Fair Market Value" means, with respect to any asset, the sale value
that would be obtained in an arm's-length transaction between an informed and
willing seller under no compulsion to sell and an informed and willing buyer.
"Federal Funds Effective Rate" is defined in the definition of the term
"Alternate Base Rate".
"Fiscal Quarter" means any quarter of a Fiscal Year.
"Fiscal Year" means any period of twelve consecutive calendar months
ending on December 31; references to a Fiscal Year with a number corresponding
to any calendar year (e.g. the "1996 Fiscal Year") refer to the Fiscal Year
ending on the December 31 occurring during such calendar year.
"5 3/4% Preference Shares" means the 5 3/4% Convertible Cumulative
Redeemable Preference Shares, par value $1.00 per share, of ADT Limited.
"Fronting Rate" means, with respect to any Issuer, the per annum rate
agreed to by the Borrower and such Issuer for use in determining such Issuer's
fronting fees in connection with Letters of Credit.
"Foreign Subsidiary" means a Subsidiary of ADT Limited that is organized
and existing under the laws of a jurisdiction other than the United States (or
any state thereof or the District of Columbia).
"F.R.S. Board" means the Board of Governors of the Federal Reserve
System or any successor thereto.
"GAAP" is defined in Section 1.4.
"Group N.V." means ADT Group N.V., a company organized under the laws of
the Netherlands Antilles.
"Guarantor" means each of ADT Limited and the Subsidiary Guarantors.
"Guarantees" means the ADT Limited Guaranty and the Subsidiary Guarantor
Guaranty.
"Hazardous Material" means
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource Conservation and
Recovery Act, as amended;
(c) any petroleum product; or
(d) any pollutant or contaminant or hazardous, dangerous or toxic
chemical, material or substance within the meaning of any other
applicable federal, state or local law, regulation, ordinance or
requirement (including consent decrees and administrative orders)
relating to or imposing liability or standards of conduct concerning any
hazardous, toxic or dangerous waste, substance or material, all as
amended or hereafter amended.
"Hedging Arrangements" means, interest rate swap agreements, interest
rate cap agreements, interest rate collar agreements and currency exchange
agreements, and all other agreements or arrangements designed to protect
against fluctuations in interest rates or currency values.
"herein", "hereof", "hereto", "hereunder" and similar terms contained in
this Agreement or any other Loan Document refer to this Agreement or such
other Loan Document, as the case may be, as a whole and not to any particular
Section, paragraph or provision of this Agreement or such other Loan Document.
"High Quality Investment" means, at any time:
(a) any certificate of deposit or bankers acceptance, with a maturity
of 180 days or less, which is issued by a commercial banking institution
that is organized under the laws of a country that is a member of the
Organization for Economic Cooperation and Development, or any political
subdivision thereof, and has a combined capital and surplus and
undivided profits of not less than $500,000,000 (or the equivalent
thereof in other currencies) and (i) whose short term obligations have a
rating, at the time any such Investment is made, of P-1 or better by
Moody's or A-1 or better by Standard & Poor's, (ii) whose debt is rated,
at the time any such Investment is made, A or better by Moody's or A or
better by Standard & Poor's or (iii) whose short term obligations or
debt is not so rated, so long as (A) such commercial banking institution
is (1) organized under the laws of a jurisdiction other than the United
Kingdom, the Channel Islands, Canada or the United States (or any state
thereof or the District of Columbia) and (2) organized under the laws of
the same jurisdiction as the jurisdiction of incorporation of the
Subsidiary of ADT Limited making such Investment and (B) such Investment
is made for ordinary course of business cash management purposes of such
Subsidiary;
(b) any deposit accounts issued or offered by any commercial banking
institution of the stature referred to in the preceding clause (a);
(c) any floating rate note issued by a financial institution or
corporation (other than an Affiliate of the Borrower, ADT Limited or any
other Subsidiary of ADT Limited) organized and existing under the laws
of a country that is a member of the Organization for Economic
Cooperation and Development, or any political subdivision thereof, whose
debt is rated, at the time any such Investment is made, A or better by
Moody's or A or better by Standard & Poor's;
(d) any medium term note, maturing not more than one year after the
date of the acquisition thereof, issued by a corporation (other than an
Affiliate of the Borrower, ADT Limited or any other Subsidiary of ADT
Limited) organized and existing under the laws of a country that is a
member of the Organization for Economic Cooperation and Development, or
any political subdivision thereof, and with a rating, as at the time
such Investment is made, of A or better by Moody's or A or better by
Standard & Poor's;
(e) any debt instrument, maturing not more than one year after the date
of the acquisition thereof, issued by an entity (other than an Affiliate
of the Borrower, ADT Limited or any other Subsidiary of ADT Limited)
organized and existing under the laws of a country that is a member of
the Organization for Economic Cooperation and Development, or any
political subdivision thereof, which is secured by or represents an
interest in a pool of mortgage loans, credit card receivables or motor
vehicle loans and with a rating, as at the time such Investment is made,
of A or better by Moody's or A or better by Standard & Poor's; or
(f) any bond, maturing not more than one year after the date of the
acquisition thereof, issued by a corporation (other than an Affiliate of
the Borrower, ADT Limited or any other Subsidiary of ADT Limited)
organized and existing under the laws of a country that is a member of
the Organization for Economic Cooperation and Development, or any
political subdivision thereof, and with a rating, as at the time such
Investment is made, of A or better by Moody's or A or better by Standard
& Poor's;
provided, however, that any such note, debt instrument or bond referred to in
the preceding clauses (c) through (f) is listed or admitted to trading on a
public exchange or reported on an over-
the-counter market or quotations system (whether within or outside the United
States).
"Holdings B.V." means ADT Holdings B.V., a company organized under the
laws of the Netherlands.
"Holdings Inc." means ADT Holdings, Inc., a Delaware corporation.
"Impermissible Qualification" means, relative to the opinion or
certification of any independent public accountant as to any financial
statement of any Obligor, any qualification or exception to such opinion or
certification
(a) which is of a "going concern" or similar nature;
(b) which relates to the limited scope of examination of matters
relevant to such financial statement; or
(c) which relates to the treatment or classification of any item in
such financial statement and which, as a condition to its removal, would
require an adjustment to such item the effect of which would be to cause
such Obligor to be in default of any of its obligations under Section
8.2.3 or Section 4.2.4 of the ADT Limited Guaranty.
"including" means including without limiting the generality of any
description preceding such term, and, for purposes of this Agreement and each
other Loan Document, the parties hereto agree that the rule of ejusdem generis
shall not be applicable to limit a general statement, which is followed by or
referable to an enumeration of specific matters, to matters similar to the
matters specifically mentioned.
"Indebtedness" of any Person means, without duplication:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments;
(b) all obligations, contingent or otherwise, relative to the face
amount of all letters of credit, whether or not drawn, and banker's
acceptances issued for the account of such Person;
(c) all obligations of such Person as lessee under leases which have
been or should be, in accordance with GAAP, recorded as Capitalized
Lease Liabilities;
(d) all other items which, in accordance with GAAP, would be included
as liabilities on the liability side of the balance sheet of such Person
as of the date at which Indebtedness is to be determined;
(e) net liabilities of such Person under all Hedging Arrangements;
(f) whether or not so included as liabilities in accordance with GAAP,
all obligations of such Person to pay the deferred purchase price of
property or services, and indebtedness (excluding prepaid interest
thereon) secured by a Lien on property owned or being purchased by such
Person (including indebtedness arising under conditional sales or other
title retention agreements), whether or not such indebtedness shall have
been assumed by such Person or is limited in recourse;
(g) all obligations of such Person relative to Redeemable Capital Stock
of such Person (including accrued and unpaid dividends); and
(h) all Contingent Liabilities of such Person in respect of any of the
foregoing.
For all purposes of this Agreement, the Indebtedness of any Person shall
include the Indebtedness of any partnership or joint venture in which such
Person is a general partner or a joint venturer.
"Indemnified Liabilities" is defined in Section 11.4.
"Indemnified Parties" is defined in Section 11.4.
"Indenture Effective Date" means August 4, 1993.
"Interest Expense" means, with respect to any Person and its
Subsidiaries for any applicable period, the sum of
(a) the aggregate consolidated gross interest expense of such Person
and its Subsidiaries for such period, as determined in accordance with
GAAP, including (i) facility fees paid or owed hereunder, (ii) all other
fees paid or owed with respect to the issuance or maintenance of
Contingent Liabilities (including letters of credit), which, in
accordance with GAAP, would be included as interest expense, (iii) net
costs or benefits under Hedging Arrangements relating to Debt and (iv)
the portion of any payments made in respect of Capitalized Lease
Liabilities of such Person and its Subsidiaries allocable to interest
expense, but excluding the amortization or write-off of debt issuance
costs and other financing expenses incurred prior to the Effective Date
or in connection with the entering into of this Agreement and the other
Loan Documents;
plus
(b) with respect to ADT Limited, dividends on the Preference Shares
during such period;
provided, however, that the Interest Expense of any Person for any period that
would include a Pre-Acquisition Period will not include any item that would be
included in the determination of the Interest Expense of ASH for such
Pre-Acquisition Period.
"Interest Period" means, relative to any Loans which are LIBO Rate
Loans, (i) in the case of any Revolving Loan, the period beginning on the date
on which such LIBO Rate Loan is made or continued as, or converted into, a
LIBO Rate Loan pursuant to Section 2.2 or 2.4 and ending on the day which
numerically corresponds to such date one, two, three, six or (if available)
nine or twelve months thereafter (or, if such month has no numerically
corresponding day, on the last Business Day of such month), in each case as
the Borrower may select in its relevant notice pursuant to Section 2.2 or 2.4,
or, (ii) in the case of any Competitive Bid Loan, the period beginning on the
date on which such LIBO Rate Loan is made pursuant to Section 2.3 and ending on
the Competitive Bid Loan Maturity Date applicable thereto; provided, however,
that
(a) the Borrower shall not be permitted to select Interest Periods with
respect to Revolving Loans to be in effect at any one time which have
expiration dates occurring on more than 12 different dates;
(b) if such Interest Period would otherwise end on a day which is not a
Business Day, such Interest Period shall end on the next following
Business Day (unless such next following Business Day is the first
Business Day of a calendar month, in which case such Interest Period
shall end on the next preceding Business Day); and
(c) no Interest Period may end later than the Stated Maturity Date.
"Intermediate Parent Companies" means, collectively, Holdings Inc.,
Holdings B.V., Group N.V. and each other direct or indirect parent of the
Borrower (other than ADT Limited).
"Investment" means, relative to any Person,
(a) any loan or advance made by such Person to any other Person;
(b) any Contingent Liability of such Person with respect to any
indebtedness, obligation or other liability of any other Person; and
(c) any ownership or similar interest held by such Person in any other
Person, including any Minority Interest.
The amount of any Investment shall be the original principal or capital amount
thereof less all returns of principal or equity thereon (and without
adjustment by reason of the financial condition of such other Person) and
shall, if made by the transfer or exchange of property other than cash, be
deemed to have been made in an original principal or capital amount equal to
the Fair Market Value of such property.
"Invitation for Bid Loan Offers" means an invitation to the Lenders,
substantially in the form of Exhibit D-1 hereto, sent by the Agent on behalf
of the Borrower pursuant to Section 2.3.2, inviting the Lenders to submit
Competitive Bid Loan Offers in accordance with Section 2.3.3.
"Issuance Request" means a properly completed application for the
issuance of a Letter of Credit on the applicable Issuer's standard form,
executed by an Authorized Officer of the Borrower.
"Issuer" means Scotiabank (or another Lender (selected by Scotiabank)
that agrees to be an Issuer hereunder and that has a public long-term senior
unsecured debt rating of at least A- from Standard & Poor's and at least A3
from Moody's), and includes any Affiliate, unit or agency of Scotiabank (or
such other Lender) having a public long-term senior unsecured debt rating of
at least A- from Standard & Poor's and at least A3 from Moody's.
"Lender Assignment Agreement" means a Lender Assignment Agreement
substantially in the form of Exhibit G hereto.
"Lenders" is defined in the preamble.
"Letter of Credit" is defined in Section 4.2.
"Letter of Credit Availability" means, at any time, the lesser of
(a) the excess of
(i) $100,000,000
over
(ii) the then Letter of Credit Outstandings,
and
(b) the Revolving Loan Commitment Availability at such time.
"Letter of Credit Outstandings" means, at any time, an amount equal to
the sum of
(a) the aggregate Stated Amount at such time of all Letters of Credit
then outstanding and undrawn (as such aggregate Stated Amount shall be
adjusted, from time to time, as a result of drawings, the issuance of
Letters of Credit or otherwise),
plus
(b) the then aggregate amount of all unpaid and outstanding
Reimbursement Obligations.
"LIBO Rate" is defined in Section 3.2.1.
"LIBO Rate Bid Margin" means, in respect of a Competitive Bid Loan, the
margin above (or below) the applicable LIBO Rate offered for such Competitive
Bid Loan, expressed as a percentage (rounded to the nearest 1/10,000th of 1%).
"LIBO Rate Margin" means, with respect to the unpaid principal amount of
each Revolving Loan maintained as a LIBO Rate Loan, subject to the proviso to
this definition, the percentage set forth opposite the "Level" below
containing the Senior Debt Rating of both Standard & Poor's and Moody's then
in effect:
Senior Debt Rating Senior Debt Rating LIBO Rate
Level (by Standard & Poor's) (by Moody's) Margin
----- ---------------------- ------------------ -----------
I BBB or better Baa2 or better 0.30%
II BBB- Baa3 0.30%
III BB+ Ba1 0.50%
IV BB Ba2 0.575%
V below BB below Ba2 0.625%;
provided, however, that in the event of (i) a split rating by Standard &
Poor's and Moody's which differs by one Level, the percentage corresponding to
the higher Level (i.e., the better Senior Debt Rating) shall be the LIBO Rate
Margin and (ii) a split rating by Standard & Poor's and Moody's which differs
by more than one Level, the percentage corresponding to the Level immediately
below the higher Level shall be the LIBO Rate Margin; provided further,
however, that, in the event that (i) only Standard & Poor's or only Xxxxx'x is
providing a Senior Debt Rating, the percentage set forth opposite the Level
containing the Senior Debt Rating which has been provided shall be the LIBO
Rate Margin or (ii) neither Standard & Poor's nor Xxxxx'x is providing a Senior
Debt Rating, the percentage set forth opposite Level V shall be the LIBO Rate
Margin.
"LIBO Rate Loan" means a Revolving Loan or a Competitive Bid Rate Loan,
as the case may be, bearing interest, at all times during an Interest Period
applicable to such Revolving Loan or Competitive Bid Rate Loan, at a fixed
rate of interest determined by reference to the LIBO Rate (Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" is defined in Section 3.2.1.
"LIBOR Office" means, with respect to any Lender, the office of such
Lender designated as such below its signature hereto or in the applicable
Lender Assignment Agreement, or such other office of a Lender (or any
successor or assign of such Lender) as may be designated as such from time to
time by notice from such Lender to the Borrower and the Agent.
"LIBOR Reserve Percentage" is defined in Section 3.2.1.
"Lien" means any security interest, mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or otherwise),
charge against or interest in property to secure payment of a debt or
performance of an obligation of any kind or nature whatsoever.
"Loan Document" means this Agreement, the Notes, the Letters of Credit,
the ADT Limited Guaranty, the Subsidiary Guarantor Guaranty (including each
Subsidiary Guarantor Guaranty Supplement), the Amendment Agreement and each
other agreement, document or instrument which is acknowledged by the Agent and
any Obligor to be a Loan Document.
"Loans" means, collectively, the Revolving Loans and the Competitive Bid
Loans.
"XXXXx" means the Liquid Yield Option[Trademark] Notes due 2010 of the
Borrower, issued pursuant to the XXXXx Indenture and subordinated by its terms
to the Obligations and the Indebtedness in respect of the Senior Notes and the
Senior Subordinated Notes, as the same may, subject to Section 4.2.11 of the
ADT Limited Guaranty, be amended, supplemented, amended and restated or
otherwise modified from time to time.
"XXXXx Guarantee" means the subordinated guarantee of ADT Limited set
forth in the guarantee provisions of the XXXXx Indenture.
"XXXXx Indenture" means the Indenture dated as of July 1, 1995, among
the Borrower, ADT Limited and Bank of Montreal Trust Company, as trustee, as
the same may, subject to Section 4.2.11 of the ADT Limited Guaranty, be
amended, supplemented, amended and restated or otherwise modified from time to
time.
"Material Related Party" means the Borrower, ADT Limited, each
Intermediate Parent Company and each Subsidiary of ADT Limited that would
satisfy the threshold set forth in clause (b) or (c) of the definition of
"Material Subsidiary" (whether or not organized and existing in the United
States (or any state thereof or the District of Columbia)).
"Material Subsidiary" means each Subsidiary of the Borrower, and each
other Subsidiary of ADT Limited organized and existing under the laws of the
United States (or any state thereof or the District of Columbia), that
(a) is designated with an asterisk in Item 2 ("Subsidiaries") of the
Disclosure Schedule;
(b) accounted for at least 5% of the consolidated gross revenues of ADT
Limited and its Subsidiaries for the most recently completed Fiscal
Quarter with respect to which, pursuant to Section 8.1.1(a) or 8.1.1(d),
financial statements have been, or are required to have been, delivered
by the Borrower on or before the date as of which any such determination
is made, as reflected in such financial statements; or
(c) has assets which represent at least 5% of the consolidated gross
assets of ADT Limited and its Subsidiaries as of the last day of the
most recently completed Fiscal Quarter with respect to which, pursuant
to Section 8.1.1(a) or 8.1.1(d), financial statements have been, or are
required to have been, delivered by the Borrower on or before the date
as of which any such determination is made, as reflected in such
financial statements.
"Minority Interest" means any equity or other beneficial ownership
interest, whether in the form of Capital Stock or otherwise, held directly or
indirectly by any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Exchange Act) in another Person and, as a result of
which, such person or group, as the case may be, does not "control" (as such
term is used in connection with clause (b) of the definition of "Affiliate")
such other Person.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Net Income" means, with respect to any Person and its Subsidiaries for
any applicable period, the aggregate of all amounts which, in accordance with
GAAP, would be included as net income (or net loss) on a consolidated
statement of income of such Person and its Subsidiaries for such period;
provided, however, that the Net Income of any Person for any Pre-Acquisition
Period will not include any item that would be included in the determination
of the Net Income of ASH for such Pre-Acquisition Period.
"Net Sale Proceeds" means, with respect to any Recapture Asset
Disposition, the excess of
(a) the gross cash proceeds received by the Borrower, ADT Limited or
any of its other Subsidiaries as a result of such Recapture Asset
Disposition
over
(b) the sum (without duplication) of
(i) the Transaction Costs incurred in connection with such
Recapture Asset Disposition;
plus
(ii) payments made to retire Indebtedness that is secured by the
assets or properties that are the subject of such Recapture Asset
Disposition;
plus
(iii) payments to holders (other than the Borrower, ADT Limited or
any other Subsidiary of ADT Limited) of Capital Stock in Subsidiaries
of ADT Limited subject to such Recapture Asset Disposition, so
long as such payments are made on a pro rata basis, consistent
with the ownership of such Capital Stock, to the holders of such
Capital Stock;
plus
(iv) any reserve for adjustment in respect of the sale price of
receivables sold on a non-recourse basis pursuant to a receivables
financing agreement or other similar agreement;
plus
(v) appropriate amounts to be provided by the recipient of such
proceeds or any Subsidiary thereof, as the case may be, as a
reserve, in accordance with GAAP, against any liabilities associated
with such Recapture Asset Disposition and retained by the recipient
of such proceeds or any Subsidiary thereof, as the case may be,
after such transaction, including pension and other post-employment
benefit liabilities, liabilities related to environmental matters
and liabilities under any indemnification obligations associated
with such Recapture Asset Disposition;
provided, however, that Net Sale Proceeds shall not include (i) any proceeds
(or portion thereof) that are received in any Fiscal Year to the extent such
proceeds (or portion thereof), together with all other such proceeds
theretofore received in such Fiscal Year, do not exceed $5,000,000 or (ii) any
proceeds of any Excluded Disposition.
"Non-Guarantors" means all Subsidiaries of ADT Limited other than the
Borrower and the Subsidiary Guarantors.
"Non-Obligors" means all Subsidiaries of the Borrower or ADT Limited
that are not Obligors.
"Non-Voting Exchangeable Shares" means the Non-Voting Exchangeable
Shares, Series A, of ADT Finance Inc., a Canadian corporation.
"Note" means, as the context may require, a Revolving Note and/or a
Competitive Bid Loan Note.
"Obligations" means all obligations (monetary or otherwise) of the
Borrower and each other Obligor arising under or in connection with this
Agreement, the Notes, each other Loan Document and each Hedging Arrangement
with a Lender permitted under Section 8.2.2 or Section 4.2.2 of the ADT
Limited Guaranty.
"Obligors" means the Borrower, the Guarantors and each of their
respective successors, transferees and assigns.
"Organic Document" means, with respect to any Person, its certificate of
incorporation, memorandum of association, by-laws and/or other constitutive
documents, and all shareholder agreements, voting trusts and similar
arrangements to which such Person is a party that are applicable to any of its
Capital Stock.
"Participant" is defined in Section 11.11.2.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in
section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a
multiemployer plan as defined in section 4001(a)(3) of ERISA), and to which
the Borrower or any corporation, trade or business that is, along with the
Borrower, a member of a Controlled Group, may have liability, including any
liability by reason of having been a substantial employer within the meaning
of section 4063 of ERISA at any time during the preceding five years, or by
reason of being deemed to be a contributing sponsor under section 4069 of
ERISA.
"Percentage" means, relative to any Lender, the percentage set forth
opposite its signature hereto or set forth in the Lender Assignment Agreement,
as such percentage may be adjusted from time to time pursuant to Lender
Assignment Agreement(s) executed by such Lender and its Assignee Lender(s) and
delivered pursuant to Section 11.11.
"Permitted Auction Business Sale" means an Asset Sale consisting of the
sale of the Capital Stock of any Subsidiary of the Borrower which is primarily
engaged, directly or through its direct or indirect Subsidiaries, in the
business of auctioning or otherwise distributing vehicles in the United States
held on a consignment or similar basis or the sale of assets (other than
Capital Stock) which are and have been used in such business, to the extent
(i) such Asset Sale is for not less than the Fair Market Value of the assets
(including Capital Stock) sold (as determined in good faith by the Board of
Directors of ADT Limited or a committee thereof, whose determination shall be
evidenced by certified written resolution of such Board or such committee) and
the consideration received by the Borrower or the relevant Subsidiary in
respect of such Asset Sale consists of at least 75% cash (including any cash
proceeds received from the sale of securities received in such Asset Sale,
provided that at the time of such Asset Sale, the Borrower or the relevant
Subsidiary has entered into a legally binding agreement for the sale of such
securities and such securities are sold within sixty days of such Asset Sale),
or Cash Equivalent Investments, and (ii) such Asset Sale does not include
assets primarily used in a Core Business other than the distributing of
vehicles in the United States held on a consignment or similar basis unless
the sale or other transfer of such assets in a separate transaction would be
permitted hereunder and under the ADT Limited Guaranty (it being acknowledged
by the parties hereto that if such transaction would not otherwise be
permitted unless within a "basket" amount, such as the amount set forth in
clause (c) of Section 4.2.10 of the ADT Limited Guaranty, the amount of such
transaction shall be applied against each such basket).
"Permitted Strategic Sale" is defined in Section 1.1 of the ADT Limited
Guaranty.
"Person" means any natural person, corporation, partnership, limited
liability company, firm, association, trust, government, governmental agency
or any other entity, whether acting in an individual, fiduciary or other
capacity.
"Plan" means any Pension Plan or Welfare Plan.
"Preference Shares" means the 5 3/4% Preference Shares and the 6%
Preference Shares.
"Pre-Acquisition Period" means any period prior to the ASH Acquisition
Date.
"Quarterly Payment Date" means the last day of each March, June,
September and December or, if any such day is not a Business Day, the next
succeeding Business Day.
"Recapture Asset Disposition" means each Permitted Strategic Sale of
Voting Stock of a Subsidiary Guarantor, each Permitted Auction Business Sale
and each Asset Sale permitted pursuant to clause (c)(ii) of Section 4.2.10 of
the ADT Limited Guaranty.
"Redeemable Capital Stock" means Capital Stock of the Borrower, ADT
Limited or any other Subsidiary of ADT Limited that, either by its terms, by
the terms of any security into which it is convertible or exchangeable or
otherwise, (i) is or upon the happening of an event or passage of time would
be required to be redeemed (for consideration other than shares of common
stock of ADT Limited) on or prior to January 7, 1999, (ii) is redeemable at
the option of the holder thereof (for consideration other than shares of
common stock of ADT Limited) at any time prior to such date or (iii) is
convertible into or exchangeable for debt securities of ADT Limited or any of
its Subsidiaries at any time prior to such anniversary.
"Reference Lenders" means Scotiabank, Credit Lyonnais Atlanta Agency and
such other Lender as the Agent and the Borrower may from time to time agree.
"Reimbursement Obligation" is defined in Section 4.6.
"Related Business" means any business directly related to the auctioning
or distribution of equipment or goods which (i) are held on a consignment or
similar basis and (ii) are being auctioned or distributed in connection with
the liquidation of businesses or lines of businesses, exclusive of the
purchasing of items for resale (other than purchases incidental and customary
in the conduct of such business and which when added to the amounts expended
in respect of all other items so purchased and still owned (including pursuant
to any business referred to in clause (a) of the definition of Core Business)
would not exceed $5,000,000).
"Release" means a "release", as such term is defined in CERCLA.
"Required Lenders" means, at any time,
(a) with respect to any provision of this Agreement other than the
declaration of the acceleration of the maturity of all or any portion of
the outstanding principal amount of the Loans and other Obligations to
be due and payable pursuant to Section 9.3, Lenders having Percentages
aggregating at least 51%, or
(b) with respect to the declaration of the acceleration of the maturity
of all or any portion of the outstanding principal amount of the Loans
and other Obligations to be due and payable pursuant to Section 9.3,
Lenders holding at least 51% of the sum of (x) the aggregate principal
amount of outstanding Loans and (y) the Letter of Credit Outstandings
(based on the participating interests held therein).
"Resource Conservation and Recovery Act" means the Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901, et seq., as in effect from time to
time.
"Revolving Loan" is defined in Section 2.1.1.
"Revolving Loan Borrowing" means Revolving Loans of the same type and,
in the case of LIBO Rate Loans, having the same Interest Period made by all
Lenders on the same Business Day in accordance with Section 2.1.
"Revolving Loan Borrowing Request" means a certificate requesting
Revolving Loans, duly executed by an Authorized Officer, substantially in the
form of Exhibit C-1 attached hereto.
"Revolving Loan Commitment" means, relative to any Lender, such Lender's
obligation to make Revolving Loans pursuant to Section 2.1.1 and to issue (in
the case of any Issuer) or participate in (in the case of all Lenders) Letters
of Credit pursuant to Section 2.1.2.
"Revolving Loan Commitment Amount" means, on any date, $250,000,000, as
such amount may be reduced from time to time pursuant to Section 2.1.4.
"Revolving Loan Commitment Availability" means, on any date, the excess
of
(a) the then Revolving Loan Commitment Amount,
over
(b) the sum of
(i) the outstanding principal amount of all Loans on such date,
plus
(ii) the Letter of Credit Outstandings on such date.
"Revolving Loan Commitment Termination Date" means the earliest of
(a) the Stated Maturity Date;
(b) the date on which the Revolving Loan Commitment Amount is
terminated in full or reduced to zero pursuant to Section 2.1.4; and
(c) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described in clause (b) or (c), the Revolving
Loan Commitments shall terminate automatically and without any further action.
"Revolving Note" means a promissory note of the Borrower payable to the
order of any Lender, in the form of Exhibit A hereto (as such promissory note
may be amended, endorsed or otherwise modified from time to time), evidencing
the aggregate Indebtedness of the Borrower to such Lender resulting from
outstanding Revolving Loans, and also means all other promissory notes
accepted from time to time in substitution therefor or renewal thereof.
"Scotiabank" is defined in the preamble.
"Senior Debt Rating" means the Borrower's senior, unsecured long-term
debt rating, as determined by Standard & Poor's or Xxxxx'x.
"Senior Note Guarantees" means the guarantees of ADT Limited and of each
of the Subsidiary Guarantors set forth in the guarantee provisions of the
Senior Note Indenture and any additional guarantee of the Senior Notes
executed pursuant to the "Limitation on Issuances of Guarantees of
Indebtedness and of Incurrence of Indebtedness of Certain Restricted
Subsidiaries" and the "Limitation on Liens" covenants of the Senior Note
Indenture.
"Senior Note Indenture" means the Indenture dated as of August 4, 1993,
among the Borrower, the guarantors named therein and The Chase Manhattan Bank
(National Association), as trustee, as the same may, subject to Section 4.2.11
of the ADT Limited Guaranty, be amended, supplemented, amended and restated or
otherwise modified from time to time.
"Senior Notes" means the 8 1/4% Senior Notes due 2000 of the Borrower,
issued pursuant to the Senior Note Indenture, as the same may, subject to
Section 4.2.11 of the ADT Limited Guaranty, be amended, supplemented, amended
and restated or otherwise modified from time to time.
"Senior Subordinated Note Guarantees" means the subordinated guarantee
of ADT Limited set forth in the guarantee provisions of the Senior
Subordinated Note Indenture and any additional guarantee of the Senior
Subordinated Notes executed pursuant to the "Limitation on Liens" and the
"Limitation on Issuances of Guarantees of Indebtedness" covenants of the
Senior Subordinated Note Indenture.
"Senior Subordinated Note Indenture" means the Indenture dated as of
August 4, 1993, among the Borrower, the guarantors named therein and
NationsBank of Georgia, National Association, as trustee, as the same may,
subject to Section 4.2.11 of the ADT Limited Guaranty, be amended,
supplemented, amended and restated or otherwise modified from time to time.
"Senior Subordinated Notes" means the 9 1/4% Senior Subordinated Notes
due 2003 of the Borrower, issued pursuant to the Senior Subordinated Note
Indenture, as the same may, subject to Section 4.2.11 of the ADT Limited
Guaranty, be amended, supplemented, amended and restated or otherwise modified
from time to time.
"6% Preference Shares" means the 6% Convertible Cumulative Redeemable
Preference Shares 2002, par value $1.00 per share, of ADT Limited.
"Standard & Poor's" means Standard & Poor's Ratings Group.
"Stated Amount" of each Letter of Credit means the maximum amount
available for drawing thereunder (whether or not any conditions to drawing can
then be met), taking into consideration the effect of any prior drawings made
thereunder.
"Stated Expiry Date" with respect to any Letter of Credit has the
meaning provided in Section 4.2.
"Stated Maturity Date" means January 7, 1998.
"Stockholders' Equity" means, with respect to any Person at any date, on
a consolidated basis for such Person and its Subsidiaries, the excess of
(a) (i) in the case of ADT Limited, the sum of common stock taken at
par value, share premium, contributed surplus, Non-voting exchangeable
shares and retained earnings (or accumulated deficit) of ADT Limited at
such date or (ii) in the case of any other Person, the sum of common
stock taken at par value, capital surplus and retained earnings (or
accumulated deficit) of such Person at such date;
over
(b) treasury stock of such Person and, to the extent included in clause
(a) above, minority interests in Subsidiaries of such Person at such
date;
provided, however, that the Stockholders' Equity of any Person will not
include any item that would be included in the determination of the retained
earnings of ASH as of the ASH Acquisition Date.
"Subordinated Debt" means all Indebtedness in respect of the Senior
Subordinated Notes, the Senior Subordinated Note Guarantees, the XXXXx, the
XXXXx Guarantee and all other Indebtedness of the Borrower, ADT Limited or any
other Subsidiary of ADT Limited for money borrowed which is subordinated in
right of payment to the payment of the Obligations.
"Subordinated Intercompany Debt" means unsecured Indebtedness (a)
subordinated to the Obligations by provisions substantially in the form set
forth in Schedule II hereto and (b) the terms of which (including interest
rate) are not more burdensome to the obligor or obligors thereunder than those
terms generally available from independent third parties to obligors similarly
situated as such obligor or obligors.
"Subsidiary" means, with respect to any Person, (i) any corporation of
which more than 50% of the outstanding Voting Stock is at the time directly or
indirectly owned by such Person or (ii) any partnership, joint venture or
other entity as to which such Person, directly or indirectly, owns more than a
50% ownership, equity or similar interest or has the power to direct or cause
the direction of management and policies, or the power to elect the managing
general partner (or the equivalent), of such partnership, joint venture or
other entity, as the case may be.
"Subsidiary Guarantors" means (i) the Subsidiaries of ADT Limited
organized under the laws of the United States (or any state thereof or the
District of Columbia) party from time to time to the Subsidiary Guarantor
Guaranty and (ii) each Subsidiary of ADT Limited that is required to execute
and deliver a Subsidiary Guarantor Guaranty Supplement pursuant to the terms
of Section 4.1.6 or 4.1.7 of the ADT Limited Guaranty.
"Subsidiary Guarantor Guaranty" means that certain Guaranty executed and
delivered by each Subsidiary Guarantor pursuant to the Existing Credit
Agreement, dated as of January 9, 1997, a conformed copy of which is attached
as Exhibit J hereto, as the same may be amended, supplemented, amended and
restated or otherwise modified from time to time.
"Subsidiary Guarantor Guaranty Supplement" means a supplement to the
Subsidiary Guarantor Guaranty, substantially in the form of Annex I thereto.
"Taxes" is defined in Section 5.6.
"10-K" means, with respect to any Person, its annual report on Form 10-K
(or any successor form thereto) filed with the Securities and Exchange
Commission pursuant to Section 13 or 15(d) of the Exchange Act.
"10-Q" means, with respect to any Person, its quarterly report on Form
10-Q (or any successor form thereto) filed with the Securities and Exchange
Commission pursuant to Section 13 or 15(d) of the Exchange Act.
"Total Capitalization" means, with respect to any Person on any date,
the sum of
(a) Debt of such Person and its Subsidiaries at such date, determined
on a consolidated basis,
plus
(b) Stockholders' Equity of such Person at such date.
"Transaction Costs" means, with respect to any Recapture Asset
Disposition, the sum of
(a) all reasonable fees and expenses incurred in connection with such
Recapture Asset Disposition (including legal, investment banking,
brokerage and accounting and other professional fees) and all sales
commissions and disbursements incurred in connection with such Recapture
Asset Disposition which have not been paid to Affiliates of the Borrower
(unless, in the case of such Affiliates that are not Subsidiaries of ADT
Limited, such fees and expenses are incurred pursuant to arrangements
permitted under Section 4.2.12 of the ADT Limited Guaranty);
plus
(b) all taxes actually paid or estimated (in good faith) to be or
become payable in connection with such Recapture Asset Disposition.
"type" means, relative to any Loan, the portion thereof, if any, being
maintained as a Base Rate Loan or a LIBO Rate Loan.
"United States" or "U.S." means the United States of America, its fifty
States and the District of Columbia.
"Voting Stock" means, with respect to any Person, Capital Stock in
respect of the class or classes pursuant to which the holders thereof have the
general voting power under ordinary circumstances to elect at least a majority
of the board of directors, managers, trustees or other similar governing body
of such Person (irrespective of whether or not at the time the Capital Stock
of any other class or classes shall have or might have voting power by reason
of the occurrence of any contingency).
"Welfare Plan" means a "welfare plan", as such term is defined in
section 3(1) of ERISA.
"Wholly Owned Subsidiary" means
(a) with respect to any Person, a Subsidiary all the Capital Stock
(other than directors' qualifying shares that are required under
applicable law) of which is owned by such Person or another Wholly Owned
Subsidiary of such Person, and
(b) with respect to ADT Limited or any other direct or indirect parent
of ADT Finance Inc.,
(i) ADT Finance Inc., if and only if and for so long as, the
Capital Stock of ADT Finance Inc. consists entirely of (A) Voting
Stock, 100% of which is owned directly or indirectly by ADT
Limited, and (B) its Non-Voting Exchangeable Shares, or
(ii) any successor corporation of ADT Finance Inc. incorporated
under the laws of Canada; provided that the Capital Stock of such
successor shall consist entirely of (A) Voting Stock, 100% of
which is owned directly or indirectly by ADT Limited, and (B)
publicly-held, non-voting preferred stock (whether now outstanding
or from time to time issued) (1) in respect of which dividends are
payable only when a dividend is payable by ADT Limited in respect
of its common stock, (2) that is convertible, exchangeable or
redeemable only for common stock of ADT Limited, (3) that will
entitle the holder thereof to participate in any liquidation,
dissolution or winding up of such successor of ADT Finance Inc.,
whether voluntary or involuntary, or any other distribution of
assets of such successor of ADT Finance Inc. among its stockholders
for the purpose of winding up its affairs, to no greater extent
than the extent to which the holders of the Non-Voting Exchangeable
Shares would currently so participate and (4) the other terms of
which are not adverse to the Lenders.
SECTION 1.2. Use of Defined Terms. Unless otherwise defined or the
context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in the Disclosure Schedule and
in each Note, Borrowing Request, Continuation/ Conversion Notice, Loan
Document, notice and other communication delivered from time to time in
connection with this Agreement or any other Loan Document.
SECTION 1.3. Cross-References; Interpretative Matters. Unless otherwise
specified, references in this Agreement and in each other Loan Document to any
Article or Section are references to such Article or Section of this Agreement
or such other Loan Document, as the case may be, and, unless otherwise
specified, references in any Article, Section or definition to any clause are
references to such clause of such Article, Section or definition. For the
avoidance of doubt, unless the context otherwise requires, references in this
Agreement to the term "date hereof" shall be references to the Effective Date.
SECTION 1.4. Accounting and Financial Determinations. 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 (including under Section 4.2.4 of the ADT Limited Guaranty)
shall be made, and all financial statements required to be delivered hereunder
or thereunder shall be prepared in accordance with, generally accepted
accounting principles as in effect in the United States ("GAAP") on December
31, 1994 on a basis consistent with the audited financial statements of ADT
Limited and the Borrower with respect to the Fiscal Year ending on such date.
ARTICLE II
COMMITMENTS, COMPETITIVE BID LOANS,
BORROWING PROCEDURES AND NOTES
SECTION 2.1. Commitments. On the terms and subject to the conditions of
this Agreement (including Article V), each Lender and each Issuer, as the case
may be, severally agrees as follows:
SECTION 2.1.1. Revolving Loan Commitment. From time to time on any
Business Day occurring prior to the Revolving Loan Commitment Termination
Date, each Lender will make Loans (relative to such Lender, its "Revolving
Loans") to the Borrower equal to such Lender's Percentage of the aggregate
amount of the Revolving Loan Borrowing requested by the Borrower to be made
on such day. On the terms and subject to the conditions hereof, the
Borrower may from time to time borrow, prepay and reborrow Revolving Loans.
SECTION 2.1.2. Commitment to Issue Letters of Credit. From time to time
on any Business Day, each Issuer will issue, and each Lender will
participate in, the Letters of Credit, in accordance with Article IV.
SECTION 2.1.3. Lenders Not Permitted or Required To Make Loans Under
Certain Circumstances. No Lender shall be permitted or required to make
any Loan to the extent that, after giving effect thereto (and any
concurrent payment of Revolving Loans or Reimbursement Obligations with the
proceeds thereof),
(a) the aggregate outstanding principal amount of all Loans of all
Lenders, together with all Letter of Credit Outstandings, would
exceed the Revolving Loan Commitment Amount, or
(b) in the case of a Revolving Loan, the aggregate outstanding
principal amount of all Revolving Loans of such Lender would exceed
such Lender's Percentage of the amount equal to the Revolving Loan
Commitment Amount less the Letter of Credit Outstandings.
SECTION 2.1.4. Reduction of the Revolving Loan Commitment Amount. The
Revolving Loan Commitment Amount is subject to reduction from time to time
pursuant to this Section 2.1.4.
SECTION 2.1.4.1. Voluntary Reduction. The Borrower may, from time to
time on any Business Day, voluntarily reduce the amount of the Revolving
Loan Commitment Amount; provided, however, that all such reductions shall
be made pro rata among all the Lenders and shall require at least three
Business Days' prior notice to the Agent and be permanent, and any partial
reduction of any such Revolving Loan Commitment Amount shall be in a
minimum amount of $5,000,000 and in an integral multiple of $1,000,000.
SECTION 2.1.4.2. Mandatory Reduction. The Revolving Loan Commitment
Amount shall automatically and permanently be reduced on the date 18 months
after receipt by the Borrower, ADT Limited or any of its other Subsidiaries
of any Net Sale Proceeds with respect to any Recapture Asset Disposition by
an amount equal to (i) the amount of such Net Sale Proceeds less (ii) (A)
in the case such Recapture Asset Disposition is a Permitted Auction
Business Sale, the amount of such Net Sale Proceeds used during such 18
month period to make payments in respect of the Dividended Note and/or for
investments in properties and assets owned by, and used in the electronic
security businesses conducted by, the Borrower and its Subsidiaries and (B)
in the case of each other Recapture Asset Disposition, the amount invested
by the Borrower, ADT Limited and any of its other Subsidiaries during such
18 month period in properties and assets which replace the properties and
assets that were the subject of such Recapture Asset Disposition or in
properties and assets used in the Core Businesses; provided, however, that
(i) so long as no Event of Default has occurred and is continuing,
commitment reductions under this Section 2.1.4.2 shall not be required
until such Net Sale Proceeds aggregate $10,000,000 or more (at which
time the entire aggregate amount of such Net Sale Proceeds shall be
required as a mandatory commitment reduction hereunder); and
(ii) in the event that any such Net Sale Proceeds shall not fully
result in a commitment reduction under this Section 2.1.4.2 because
such Net Sale Proceeds do not aggregate $10,000,000 or more, the
amount that did not result in a commitment reduction shall be carried
forward and added to Net Sale Proceeds subsequently received by the
Borrower, ADT Limited or any of its other Subsidiaries for the
purpose of determining any subsequent commitment reduction required
under this Section 2.1.4.2.
SECTION 2.2. Borrowing Procedure for Revolving Loans. By delivering a
Revolving Loan Borrowing Request to the Agent on or before 10:00 a.m., New
York City time, on a Business Day, the Borrower may from time to time
irrevocably request, on not less than three (in the case of any Revolving Loan
Borrowing of LIBO Rate Loans) nor more than five (in the case of any Revolving
Loan Borrowing) Business Days' notice, that a Borrowing be made (i) in a
minimum amount of $5,000,000 and an integral multiple of $1,000,000, (ii) in
the unused amount of the Revolving Loan Commitment Amount or (iii) in the case
of a Revolving Loan Borrowing of Base Rate Loans to fund any Reimbursement
Obligation pursuant to Section 4.5.2(e), in the amount of the Reimbursement
Obligation funded by such Revolving Loan Borrowing. On the terms and subject
to the conditions of this Agreement, each Revolving Loan Borrowing shall be
comprised of the type of Revolving Loans, and shall be made on the Business
Day, specified in such Revolving Loan Borrowing Request. On or before 11:00
a.m. (New York City time) on the Business Day so specified each Lender shall
deposit with the Agent same day funds in an amount equal to such Lender's
Percentage of the requested Revolving Loan Borrowing. Such deposit will be
made to an account which the Agent shall specify from time to time by notice
to the Lenders. To the extent funds are received from the Lenders, the Agent
shall make such funds available to the Borrower by wire transfer to the
accounts the Borrower shall have specified in its Revolving Loan Borrowing
Request. No Lender's obligation to make any Revolving Loan shall be affected
by any other Lender's failure to make any Loan.
SECTION 2.3. Competitive Bid Loans. Subject to the terms and conditions of
this Agreement (including Article VI), each Lender severally agrees that the
Borrower may request that Competitive Bid Loan Borrowings under this Section
2.3 be made from time to time on any Business Day prior to the date occurring
one month prior to the Revolving Loan Commitment Termination Date in the
manner set forth below; provided, however, that following the making of each
Competitive Bid Loan Borrowing (and any concurrent payment of Revolving Loans
or Reimbursement Obligations with the proceeds thereof), the aggregate amount
of all Loans then outstanding shall not exceed the amount equal to the
Revolving Loan Commitment Amount less the Letter of Credit Outstandings.
SECTION 2.3.1. Competitive Bid Loan Borrowing Request. The Borrower may
request Competitive Bid Loan Borrowings under this Section by delivering to
the Agent not later than 12:00 noon (New York City time) at least four
Business Days prior to the date of the proposed Competitive Bid Loan
Borrowing, a Competitive Bid Loan Borrowing Request (which may contain
requests for up to three different Competitive Bid Loans with three different
Competitive Bid Loan Maturity Dates, but having the same date of funding),
specifying
(a) the amount of each Competitive Bid Loan to be made as part of
such proposed Competitive Bid Loan Borrowing,
(b) the proposed date (which shall be a Business Day) and
aggregate principal amount or amounts of each Competitive Bid Loan to
be made as part of such proposed Competitive Bid Loan Borrowing
(which shall be in a minimum principal amount of $5,000,000 and in an
integral multiple of $1,000,000), and
(c) the proposed maturity date or dates (each a "Competitive Bid
Loan Maturity Date") for repayment of each Competitive Bid Loan to be
made as part of such Competitive Bid Loan Borrowing (which maturity
date or dates shall be (i) the date or dates occurring one, two,
three or six months after the date of such Competitive Bid Loan
Borrowing and (ii) not later than the Stated Maturity Date).
The Borrower shall not deliver to the Agent any Competitive Bid Loan Borrowing
Request within five Business Days after the delivery of any other Competitive
Bid Loan Request.
SECTION 2.3.2. Invitation for Bid Loan Offers. Promptly upon receipt
of a Competitive Bid Loan Borrowing Request but in no event later than 4:00
p.m. (New York City time) on the date of such receipt, the Agent shall
send to the Lenders by telecopy an Invitation for Bid Loan Offers
substantially in the form of Exhibit D-1 attached hereto, which shall
constitute an invitation on behalf of the Borrower to each Lender to submit
Competitive Bid Loan Offers offering to make the Competitive Bid Loans to
which such Competitive Bid Loan Borrowing Request relates in accordance
with this Section 2.3.
SECTION 2.3.3. Submission and Contents of Bid Loan Offers.
(a) If any Lender, in its sole discretion, elects to offer to make a
Competitive Bid Loan to the Borrower as part of a proposed Competitive Bid
Loan Borrowing at a rate of interest specified by such Lender in its sole
discretion, it shall deliver to the Agent not later than 10:00 a.m. (New York
City time) on the third Business Day prior to the proposed date of Borrowing, a
Competitive Bid Loan Offer, which must comply with the requirements of this
clause, substantially in the form of Exhibit D-2 hereto; provided, however,
that Competitive Bid Loan Offers submitted by the Agent (or any affiliate of
the Agent) in the capacity of a Lender may be submitted, and may only be
submitted, if the Agent or such affiliate notifies the Borrower of the terms
of the offer or offers contained therein not later than 9:45 a.m. (New York
City time) on the third Business Day prior to the proposed date of borrowing.
Each Competitive Bid Loan Offer shall specify
(i) the proposed date of Borrowing, which shall be the same as
that set forth in the applicable Invitation for Bid Loan Offers,
(ii) the principal amount of the Competitive Bid Loan which the
Lender submitting such Competitive Bid Loan Offer would be willing to
make as part of such proposed Competitive Bid Loan Borrowing (which
amount shall be in a minimum principal amount of $5,000,000 and in an
integral multiple of $1,000,000 and which amount may exceed such
Lender's Percentage of the Revolving Loan Commitment Amount),
(iii) the LIBO Rate Bid Margin therefor, and
(iv) the identity of the quoting Lender;
provided, however, that any Competitive Bid Loan Offer submitted by a Lender
pursuant to this Section 2.3.3 shall be irrevocable, unless otherwise
consented to in writing by the Agent acting upon the instructions of the
Borrower.
(b) Any Competitive Bid Loan Offer that:
(i) is not substantially in the form of Exhibit D-2 hereto or
does not specify all of the information required in this Section 2.3.3;
(ii) contains qualifying, conditional or similar language;
(iii) contains proposed terms other than or in addition to those
set forth in the applicable Invitation for Bid Loan Offers; or
(iv) arrives after the time set forth in this Section 2.3.3
shall be disregarded by the Agent.
SECTION 2.3.4. Notice to Borrower. The Agent shall (by telephone,
promptly confirmed in writing) notify the Borrower of the terms of any
Competitive Bid Loan Offer submitted by a Lender that is in accordance with
Section 2.3.3 with all due haste after the receipt thereof. The Agent's
notice to the Borrower shall specify (a) the aggregate principal amount of
Competitive Bid Loans for which Competitive Bid Loan Offers have been
received in accordance with the terms specified in the related Competitive
Bid Loan Borrowing Request, (b) the respective principal amounts and LIBO
Rate Bid Margins so offered, and (c) the identity of such quoting Lenders.
SECTION 2.3.5. Competitive Bid Loan Acceptance. The Borrower shall,
before 11:00 a.m. (New York City time) on the third Business Day prior to
the proposed date of such proposed Competitive Bid Loan Borrowing, either
(a) irrevocably cancel the Competitive Bid Loan Borrowing Request
that requested such Competitive Bid Loan Borrowing by giving the Agent
telephonic notice, promptly confirmed in writing (and the Agent shall
promptly so notify each of the Lenders) to that effect (and, for
purposes of this Section, a failure on the part of the Borrower to timely
notify the Agent under the terms of this clause shall be deemed to be
non-acceptance of all Competitive Bid Loan Offers so notified to the
Borrower pursuant to Section 2.3.4), or
(b) (i) irrevocably accept, in whole or in part, one or more of the
Competitive Bid Loan Offers made by any Lender or Lenders pursuant to
Section 2.3.3, in its sole discretion, by giving the Agent telephonic
notice (promptly confirmed in writing by delivery to the Agent of a
Competitive Bid Loan Acceptance), and the Agent shall, promptly upon
receiving such telephonic notice from the Borrower, notify each Lender
whose Competitive Bid Loan Offer has been accepted, in whole or in part,
of (A) the amount of the Competitive Bid Loan Borrowing to be made on
such date, and (B) the amount of the Competitive Bid Loan (which amount
shall not be greater than the amount offered by such Lender for such
Competitive Bid Loan pursuant to Section 2.3.3) to be made by such
Lender as part of such Competitive Bid Loan Borrowing, and (ii)
irrevocably reject any remaining Competitive Bid Loan Offers made by
Lenders pursuant to Section 2.3.3 by giving the Agent telephonic notice,
promptly confirmed in writing (and the Agent shall promptly so notify
the Lenders) to that effect; provided, however, that
(A) the Borrower shall not accept an offer made at a particular
Competitive Bid Rate if the Borrower has decided to reject an
offer made in respect of the same Competitive Bid Loan Borrowing
with the same Competitive Bid Loan Maturity Date and a lower
Competitive Bid Rate,
(B) the aggregate principal amount of the Competitive Bid Loan
Offers accepted by the Borrower shall not exceed the principal
amount specified in the Competitive Bid Loan Borrowing Request
therefor,
(C) if the Borrower shall accept an offer or offers made at a
particular Competitive Bid Rate but the amount of such offer or
offers shall cause the total amount of offers to be accepted by
the Borrower to exceed the amount specified in the Competitive
Bid Loan Borrowing Request therefor, then the Borrower shall
(1) accept a portion of such offer or offers in an
aggregate amount equal to the amount specified in the
Competitive Bid Loan Borrowing Request less the amount of
all other offers accepted with respect to such Competitive
Bid Loan Borrowing Request, and
(2) allocate the Competitive Bid Loans in respect of
which such offers are accepted among the Lenders submitting
such offers as nearly as possible in proportion to the
aggregate amount of such offers made by each Lender
(provided, that if the available principal amount of
Competitive Bid Loans to be so allocated is not sufficient
to enable Competitive Bid Loans to be so allocated to each
such Lender in a minimum principal amount of $5,000,000, the
number of such Lenders shall be reduced by the Agent by lot
until the Competitive Bid Loans to be made by such remaining
Lenders would be in a principal amount of $5,000,000 or an
integral multiple of $1,000,000 in excess thereof),
(D) no bid shall be accepted for a Competitive Bid Loan unless
such Competitive Bid Loan is in a minimum principal amount of
$5,000,000 and an integral multiple of $1,000,000 and is part of a
Competitive Bid Loan Borrowing in a minimum principal amount of
$5,000,000, and
(E) the Borrower may not accept any offer that is described in
clause (b) of Section 2.3.3 or that otherwise fails to comply
with the requirements of this Agreement.
A notice given by the Borrower pursuant to this clause (b) of this
Section 2.3.5 shall be irrevocable.
SECTION 2.3.6. Funding of Competitive Bid Loans. Not later than 12:00
noon (New York City time) on the date specified for each Competitive Bid
Loan Borrowing hereunder, each Lender participating therein shall deposit
with the Agent same day funds in the amount of the Competitive Bid Loan to
be made by it on such date. Such deposit will be made to an account which
the Agent shall specify from time to time by notice to the Lenders. The
amount so received by the Agent shall be made available to the Borrower by
wire transfer to the accounts the Borrower notified to the Agent in
writing. As soon as practicable after the Competitive Bid Loan Borrowing,
the Agent shall notify each Lender of the amount of the Competitive Bid
Loan Borrowing, the applicable Competitive Bid Rates accepted, the
consequent Competitive Bid Outstanding Balance, the date on which such
Competitive Bid Loan Borrowing was made and the corresponding Competitive
Bid Loan Maturity Date applicable to all Competitive Bid Loans that are
part of such Competitive Bid Loan Borrowing.
SECTION 2.4. Continuation and Conversion Elections. By delivering a
Continuation/Conversion Notice to the Agent on or before 10:00 a.m., New
York City time, on a Business Day, the Borrower may from time to time
irrevocably elect, on not less than three nor more than five Business Days'
notice that all, or any portion in an aggregate minimum amount of
$5,000,000 and an integral multiple of $1,000,000, of any Revolving Loans
be, in the case of Revolving Loans which are Base Rate Loans, converted
into Revolving Loans which are LIBO Rate Loans or, in the case of Revolving
Loans which are LIBO Rate Loans, be converted into Revolving Loans which
are Base Rate Loans or continued as Revolving Loans which are LIBO Rate
Loans (in the absence of delivery of a Continuation/ Conversion Notice with
respect to any Revolving Loan which is a LIBO Rate Loan at least three
Business Days before the last day of the then current Interest Period with
respect thereto, such Revolving Loan which is a LIBO Rate Loan shall, on
such last day, automatically convert to a Revolving Loan which is a Base
Rate Loan); provided, however, that (i) each such conversion or
continuation shall be pro rated among the applicable outstanding Revolving
Loans of all Lenders, and (ii) no portion of the outstanding principal
amount of any Revolving Loans may be continued as, or be converted into,
LIBO Rate Loans when any Event of Default has occurred and is continuing.
SECTION 2.5. Funding. Each Lender may, if it so elects, fulfill its
obligation to make, continue or convert LIBO Rate Loans hereunder by causing
one of its foreign branches or Affiliates or an international banking
facility created by such Lender to make or maintain such LIBO Rate Loan to the
extent such branch, Affiliate or banking facility has complied, if applicable,
with the provisions of the last paragraph of Section 5.6 as if such branch,
Affiliate or banking facility were a Lender hereunder; provided, however, that
such LIBO Rate Loan shall nonetheless be deemed to have been made and to be
held by such Lender, and the obligation of the Borrower to repay such LIBO Rate
Loan shall nevertheless be to such Lender for the account of such foreign
branch, Affiliate or international banking facility. In addition, the
Borrower hereby consents and agrees that, for purposes of any determination to
be made for purposes of Section 5.1, 5.2, 5.3 or 5.4, it shall be conclusively
assumed that each Lender elected to fund all LIBO Rate Loans by purchasing
Dollar deposits in its LIBOR Office's interbank eurodollar market; provided,
however, that nothing in this sentence shall affect the provisions in Article
V to the extent that such Article provides that amounts to be reimbursed by
the Borrower are to be determined on the basis of actual costs and actual
reductions incurred by one or more Lenders.
SECTION 2.6. Notes. (a) Each Lender's Revolving Loans shall be
evidenced by a Revolving Note payable to the order of such Lender in a
maximum principal amount equal to such Lender's Percentage of the original
Revolving Loan Commitment Amount.
(b) Each Lender's Competitive Bid Loans shall be evidenced by a
Competitive Bid Loan Note payable to the order of such Lender in a maximum
principal amount equal to the original Revolving Loan Commitment Amount.
(c) The Borrower hereby irrevocably authorizes each Lender to make (or
cause to be made) appropriate notations on the grid attached to such Lender's
Notes (or on any continuation of such grid), which notations, if made, shall
evidence, inter alia, the date of, the outstanding principal amount of, and
the Interest Period (in the case of Revolving Loans), or the Competitive Bid
Loan Maturity Dates and the Competitive Bid Loan Interest Payment Dates (in
the case of Competitive Bid Loans) applicable to the Loans evidenced thereby.
Such notations shall, to the fullest extent permitted under applicable law, be
conclusive and binding on the Borrower absent manifest error; provided,
however, that the failure of any Lender to make any such notations shall not
limit or otherwise affect any Obligations of the Borrower or any other Obligor.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments. The Borrower shall repay in
full the unpaid principal amount of each Revolving Loan on the Stated
Maturity Date and shall repay in full the unpaid principal amount of each
Competitive Bid Loan on the Competitive Bid Loan Maturity Date thereof.
Prior to such Stated Maturity Date or such Competitive Bid Loan Maturity
Date, as the case may be, repayments and prepayments of Loans shall be made
as set forth in this Section 3.1. Each prepayment of any Loans made
pursuant to this Section shall be without premium or penalty, except as may
be required by Section 5.4.
SECTION 3.1.1 Voluntary Prepayments.
SECTION 3.1.1.1. Revolving Loans. From time to time on any Business
Day, the Borrower may make a voluntary prepayment, in whole or in part, of the
outstanding principal amount of any Revolving Loans, and may cash
collateralize, in whole or part, outstanding Letters of Credit; provided,
however, that
(a) any such prepayment shall be made pro rata among Revolving Loans
of the same type and, if applicable, having the same Interest Period
of all Lenders;
(b) all such voluntary prepayments shall require at least three (in
the case of Revolving Loans which are LIBO Rate Loans) or one (in the
case of Revolving Loans which are Base Rate Loans), but no more than
five (in the case of any Revolving Loans), Business Days' prior
written notice to the Agent;
(c) all such voluntary partial prepayments shall be in an aggregate
minimum amount of $5,000,000 and an integral multiple of $1,000,000
or in the aggregate principal amount of all Revolving Loans of the
same type and, in the case of Revolving Loans which are LIBO Rate
Loans, having the Interest Period of the Revolving Loans being
prepaid; and
(d) no voluntary prepayment of principal of any Revolving Loan shall
cause a reduction in the Revolving Loan Commitment Amount.
SECTION 3.1.1.2. Competitive Bid Loans. The Borrower shall have no
right to prepay, in whole or in part, the outstanding principal amount of
any Competitive Bid Loan, unless (i) the Lender that has made such
Competitive Bid Loan otherwise consents in writing or (ii) such Competitive
Bid Loan is accruing interest at such time at a rate determined on the
basis of the Alternate Base Rate pursuant to Section 5.1. Any Competitive
Bid Loan may be prepaid in whole or in part in amounts of at least
$5,000,000 or any larger integral multiple of $1,000,000 in excess thereof
at any time at which such Competitive Bid Loan shall bear interest at a
rate determined on the basis of the Alternate Base Rate pursuant to Section
5.1.
SECTION 3.1.2. Mandatory Prepayments. The Borrower shall make mandatory
prepayments as set forth in this Section 3.1.2. Each mandatory prepayment
under this Section 3.1.2 shall be applied in accordance with the terms of this
Section 3.1.2.
SECTION 3.1.2.1. Mandatory Prepayment Upon Commitment Reduction. The
Borrower shall, on each date when any reduction in the Revolving Loan
Commitment Amount shall become effective, including pursuant to Section
2.1.4, make a mandatory prepayment (which shall be applied (or held for
application, as the case may be) by the Lenders first to the payment of the
aggregate unpaid principal amount of the Loans then outstanding, and then
to the payment and/or cash collateralization of the then outstanding Letter
of Credit Outstandings) equal to the excess, if any, of the aggregate,
outstanding principal amount of all Loans and Letter of Credit Outstandings
over the Revolving Loan Commitment Amount as so reduced; provided, however,
that if (and to the extent) on the date of any prepayment required under
this Section 3.1.2.1 a LIBO Rate Loan would otherwise be required to be
prepaid on a day other than the last day of the then current Interest
Period (or, in the case of a Competitive Bid Loan, the Competitive Bid Loan
Maturity Date applicable thereto) with respect to such Loan (after
prepaying any Revolving Loans then outstanding that are Base Rate Loans),
the Borrower may (in the case of LIBO Rate Loans which are Revolving Loans)
or shall (in the case of Competitive Bid Loans) defer such prepayment with
respect to such LIBO Rate Loan until, in the case of a LIBO Rate Loan which
is a Revolving Loan, the last day of the then current Interest Period with
respect to such LIBO Rate Loan or, in the case of a Competitive Bid Loan,
the Competitive Bid Loan Maturity Date applicable thereto.
SECTION 3.1.2.2. Acceleration of Scheduled Maturity. The Borrower shall,
immediately upon any acceleration of the Stated Maturity Date or Competitive
Bid Loan Maturity Date of any Loans pursuant to Section 9.2 or Section 9.3,
repay all Loans, unless, pursuant to Section 9.3, only a portion of all Loans
is so accelerated, in which case the Borrower shall repay such Loans so
accelerated.
SECTION 3.2. Interest Provisions. Interest on the outstanding principal
amount of Loans shall accrue and be payable in accordance with this Section
3.2.
SECTION 3.2.1. Rates. (a) Pursuant to an appropriately delivered
Borrowing Request or Continuation/Conversion Notice, the Borrower may elect
that Revolving Loans comprising a Revolving Loan Borrowing accrue interest
at a rate per annum:
(i) on that portion maintained from time to time as a Base Rate
Loan, equal to the Alternate Base Rate from time to time in effect; and
(ii) on that portion maintained as a LIBO Rate Loan, during each
Interest Period applicable thereto, equal to the sum of the LIBO Rate
(Reserve Adjusted) for such Interest Period plus the applicable LIBO
Rate Margin.
The "LIBO Rate (Reserve Adjusted)" means, relative to any Loan to be
made, continued or maintained as, or converted into, a LIBO Rate Loan for any
Interest Period, a rate per annum (rounded upwards, if necessary, to the
nearest 1/16 of 1%) determined pursuant to the following formula:
LIBO Rate = LIBO Rate
(Reserve Adjusted) -------------------------------
1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for any LIBO Rate
Loan will be determined by the Agent on the basis of the LIBOR Reserve
Percentage in effect on, and the applicable rates furnished to and received by
the Agent from the Reference Lender or Reference Lenders, as the case may be,
two Business Days before the first day of such Interest Period, subject,
however, to the provisions of Section 3.2.4.
"LIBO Rate" means, relative to any Interest Period for any LIBO Rate
Loan, the rate of interest equal to the average (rounded upwards, if
necessary, to the nearest 1/16 of 1%) of the rates per annum at which Dollar
deposits in immediately available funds are offered to each Reference Lender's
LIBOR Office in the London interbank market as at or about 11:00 a.m. London
time two Business Days prior to the beginning of such Interest Period for
delivery on the first day of such Interest Period, and in an amount
approximately equal to the amount of each such Reference Lender's LIBO Rate
Loan (in the case of a LIBO Rate Loan which is a Revolving Loan) or the amount
of the Competitive Bid Loan Borrowing of which such LIBO Rate Loan is a part
(in the case of a LIBO Rate Loan which is a Competitive Bid Loan) and for a
period approximately equal to such Interest Period.
"LIBOR Reserve Percentage" means, relative to any Interest Period for
any LIBO Rate Loan, the reserve percentage (expressed as a decimal) equal to
the maximum aggregate reserve requirements (including all basic, emergency,
supplemental, marginal and other reserves and taking into account any
transitional adjustments or other scheduled changes in reserve requirements)
specified under regulations issued from time to time by the F.R.S. Board and
then applicable to liabilities consisting of and including "Eurocurrency
Liabilities", as currently defined in Regulation D of the F.R.S. Board.
(b) Each Competitive Bid Loan shall accrue interest at a rate per
annum equal to the Competitive Bid Rate specified by the Lender making such
Competitive Bid Loan in its Competitive Bid Loan Offer with respect thereto
delivered pursuant to Section 2.3.3 above and accepted by the Borrower
pursuant to Section 2.3.5.
(c) All LIBO Rate Loans shall bear interest from and including the
first day of the applicable Interest Period to (but not including) the last
day of such Interest Period at the interest rate determined as applicable
to such LIBO Rate Loan for such Interest Period.
SECTION 3.2.2. Post-Maturity Rates. After the date any principal
amount of any Loan is due and payable (whether on the Stated Maturity Date,
upon acceleration or otherwise), or after any other monetary Obligation of
the Borrower shall have become due and payable, the Borrower shall pay, but
only to the extent permitted by law, interest (after as well as before
judgment) on such amounts at a rate per annum equal to the Alternate Base
Rate plus a margin of 2.0% (or, to the extent any such amounts constitute
principal in respect of any LIBO Rate Loan, at a rate per annum equal to
the LIBO Rate (Reserve Adjusted) with respect thereto plus a margin of 2.0%
plus the LIBO Rate Margin (or, in the case of Competitive Bid Loans, plus
(or minus) the applicable LIBO Rate Bid Margin) applicable to such amounts
for the remaining period of the applicable Interest Period then in effect).
SECTION 3.2.3. Payment Dates. Interest accrued on each Loan shall be
payable, without duplication:
(a) in the case of any Revolving Loan, on the Stated Maturity Date
therefor;
(b) on any portion of the principal amount of any Loan that is
voluntarily or mandatorily paid or prepaid, on the date of such
voluntary or mandatory payment or prepayment;
(c) with respect to Revolving Loans which are Base Rate Loans, on
each Quarterly Payment Date occurring after the Effective Date;
(d) with respect to Revolving Loans which are LIBO Rate Loans, on
the last Business Day of each applicable Interest Period (and, if
such Interest Period shall exceed three months, on each three (and
integral of three) month anniversary of the making of such LIBO Rate
Loan);
(e) with respect to any Revolving Loans which are Base Rate Loans
converted into Revolving Loans which are LIBO Rate Loans on a day
when interest would not otherwise have been payable pursuant to
clause (c), on the date of such conversion;
(f) with respect to Competitive Bid Loans, on each Competitive Bid
Loan Maturity Date and, with respect to Competitive Bid Loans with a
Competitive Bid Loan Maturity Date in excess of three months after
the date such Competitive Bid Loan is made, on each three (and
integral of three) month anniversary of the making of such
Competitive Bid Loan (each such date (including each Competitive Bid
Loan Maturity Date), a "Competitive Bid Loan Interest Payment Date");
and
(g) on that portion of any Loans the Stated Maturity Date of which
(or, in the case of any Competitive Bid Loans, the Competitive Bid
Loan Maturity Date of which) is accelerated pursuant to Section 9.2
or Section 9.3, immediately upon such acceleration.
Interest accrued on Loans or other monetary Obligations arising under this
Agreement or any other Loan Document after the date such amount is due and
payable (whether on the Stated Maturity Date, upon acceleration or otherwise)
shall be payable upon demand.
SECTION 3.2.4. Interest Rate Determination. Each Reference Lender
agrees to furnish to the Agent timely information for the purpose of
determining each LIBO Rate. If any one or more of the Reference Lenders
shall fail timely to furnish such information to the Agent for any such
interest rate, the Agent shall determine such interest rate on the basis of
the information furnished by the remaining Reference Lenders.
SECTION 3.3. Fees. The Borrower agrees to pay the fees set forth in this
Section 3.3. All such fees shall be non-refundable.
SECTION 3.3.1. Facility Fee. The Borrower agrees to pay to the Agent for
the account of each Lender for each day during the period (including any
portion thereof when any of the Revolving Loan Commitments are suspended by
reason of the Borrower's inability to satisfy any condition of Article VI)
commencing on January 14, 1997 and continuing through the Revolving Loan
Commitment Termination Date, a facility fee on the Revolving Loan
Commitment Amount for such day, calculated on the basis of the percentage
per annum set forth opposite the "Level" below containing the Senior Debt
Rating of both Standard & Poor's and Moody's in effect for such day;
provided, however, that in the event of (i) a split rating by Standard &
Poor's and Moody's which differs by one Level, the percentage corresponding
to the higher Level (i.e., the better Senior Debt Rating) shall be the
percentage and (ii) a split rating by Standard & Poor's and Moody's which
differs by more than one Level, the percentage corresponding to the Level
immediately below the higher Level shall be the percentage; provided
further, however, that in the event that (i) only Standard & Poor's or only
Xxxxx'x is providing a Senior Debt Rating, the percentage set forth
opposite the Level containing the Senior Debt Rating which has been
provided shall be the percentage or (ii) neither Standard & Poor's nor
Xxxxx'x is providing a Senior Debt Rating, the percentage set forth
opposite Level V shall be the percentage.
Senior Debt Rating Senior Debt Rating
Level (by Standard & Poor's) (by Moody's) Percentage
-------- ---------------------- ------------------ ----------
I BBB or better Baa2 or better 0.15%
II BBB- Baa3 0.20%
III BB+ Ba1 0.25%
IV BB Ba2 0.30%
below BB or below Ba2 or
V non-rated non-rated 0.375%
Such fee shall be payable by the Borrower in arrears on each Quarterly Payment
Date, commencing with the first such Quarterly Payment Date following the
Effective Date and on the Revolving Loan Commitment Termination Date.
SECTION 3.3.2. Letter of Credit Face Amount Fee. The Borrower agrees
to pay to the Agent, for the account of the Lenders, a fee for each Letter
of Credit for the period from and including the date of the issuance of
such Letter of Credit (which date, in the case of an Existing Letter of
Credit, shall be the Closing Date) to (but excluding) the date upon which
such Letter of Credit expires equal to the LIBO Rate Margin then in effect
per annum of the Stated Amount of such Letter of Credit. Such fee shall be
calculated on a daily basis and shall be payable by the Borrower in arrears
on each Quarterly Payment Date to occur after issuance of such Letter of
Credit and on the Revolving Loan Commitment Termination Date.
SECTION 3.3.3. Letter of Credit Issuer Fronting Fee. The Borrower
agrees to pay to the Agent, for the account of the applicable Issuer, an
issuing fee for each Letter of Credit for the period from and including the
date of issuance of such Letter of Credit (which date, in the case of an
Existing Letter of Credit, shall be the Closing Date) to (but excluding)
the date upon which such Letter of Credit expires equal to the product of
the applicable Fronting Rate multiplied by the Stated Amount of such Letter
of Credit. Such fee shall be payable by the Borrower in arrears on each
Quarterly Payment Date to occur after issuance of such Letter of Credit and
on the Revolving Loan Commitment Termination Date.
SECTION 3.3.4. Letter of Credit Administrative Expenses. The Borrower
agrees to pay to the Agent, for the account of the applicable Issuer(s),
the amounts referred to in Section 4.3.
SECTION 3.3.5. Other Fees. The Borrower agrees to pay to the Agent for its
account, or to the Agent for the account of the Lenders and/or the Issuer(s),
as the case may be, such fees as previously agreed to in writing by the
applicable parties and not otherwise set forth in this Section 3.3.
ARTICLE IV
LETTERS OF CREDIT
SECTION 4.1. Issuances and Extensions. On the terms and subject to the
conditions of this Agreement (including Article VI), the applicable Issuer or
Issuers shall issue Letters of Credit (and extend the Stated Expiry Dates of
outstanding Letters of Credit) in accordance with the Issuance Requests made
therefor pursuant to Section 4.2. Each Issuer will make available the
original of each Letter of Credit which it issues in accordance with the
Issuance Request therefor to the beneficiary thereof, and will promptly
provide each of the Lenders with a copy of such Letter of Credit (and will
notify the beneficiary under any such Letter of Credit of any extension of the
Stated Expiry Date thereof). Each Letter of Credit (as defined in the Existing
Credit Facility) outstanding under the Existing Credit Facility on the Closing
Date (each, an "Existing Letter of Credit") shall be deemed to have been
issued hereunder on the Closing Date and, on and as of the Closing Date, each
Issuer of each Existing Letter of Credit hereby releases each Lender (as
defined in the Existing Credit Facility) from all obligations under the
Existing Credit Facility in respect of any Existing Letter of Credit.
SECTION 4.2. Issuance Requests. By delivering to the Agent and the
applicable Issuer an Issuance Request on or before 12:00 noon, New York City
time, the Borrower may request, from time to time prior to the Revolving Loan
Commitment Termination Date and on not less than three nor more than ten
Business Days' notice, that such Issuer issue an irrevocable commercial or
standby letter of credit in such form as may be requested by the Borrower (each
such request to include (i) the forms of instruments to be used to make draws
thereunder and to extend or renew the term thereof and (ii) the written
confirmation of the beneficiary thereunder as to its acceptance of such forms)
and approved in every respect by such Issuer (each such letter of credit,
together with each Existing Letter of Credit, a "Letter of Credit"), for any
purpose permitted under Section 5.11. Upon receipt of an Issuance Request,
the Agent shall promptly notify the Lenders thereof. Each Letter of Credit
shall by its terms:
(a) be issued in a Stated Amount which
(i) is at least $100,000; and
(ii) does not exceed the then Letter of Credit Availability;
(b) be stated to expire on a date (its "Stated Expiry Date") no
later than the Revolving Loan Commitment Termination Date; and
(c) in the case of Letters of Credit other than Letters of Credit
to be used as credit support for corporate insurance purposes, on or
prior to its Stated Expiry Date
(i) terminate immediately upon notice to the Issuer thereof
from the beneficiary thereunder that all obligations covered
thereby have been terminated, paid, or otherwise satisfied in
full, and
(ii) reduce in part immediately and to the extent the
beneficiary thereunder has notified the Issuer thereof that the
obligations covered thereby have been paid or otherwise
satisfied in part.
So long as no Default has occurred and is continuing, by delivery to the
applicable Issuer and the Agent of an Issuance Request at least three but not
more than sixty Business Days prior to the Stated Expiry Date of any Letter of
Credit, the Borrower may request such Letter of Credit Issuer to extend the
Stated Expiry Date of such Letter of Credit for an additional period that does
not end after the Revolving Loan Commitment Termination Date. Notwithstanding
any provision contained in the foregoing to the contrary, the Borrower may not
request the issuance of, and no Issuer shall have an obligation to issue, any
Letter of Credit at any time when, or if after giving effect to such issuance,
and so long as, there shall be outstanding in the aggregate thirty Letters of
Credit.
SECTION 4.3. Expenses. The Borrower agrees to pay to the Agent for the
account of the applicable Issuer(s) all standard administrative expenses of
such Issuer(s) in connection with the issuance, maintenance, modification (if
any) and administration of each Letter of Credit issued by such Issuer(s) upon
demand from time to time.
SECTION 4.4. Participation By Lenders. (a) Each Letter of Credit
issued or deemed issued pursuant to this Article IV shall, effective upon
its issuance or deemed issuance and without further action, be issued or
deemed issued on behalf of all Lenders (including the applicable Issuer)
pro rata according to their respective Percentages. Each Lender shall, to
the extent of its Percentage, be deemed irrevocably to have participated in
the issuance of such Letter of Credit and shall be responsible to reimburse
promptly the applicable Issuer for Reimbursement Obligations which have not
been reimbursed by the Borrower in accordance with Section 4.5, or which
have been reimbursed by the Borrower but must be returned, restored or
disgorged by such Issuer for any reason. Each Lender shall, to the extent
of its Percentage, be entitled to receive from the Agent a ratable portion
of the letter of credit fees received by the Agent pursuant to Section
3.3.2, with respect to each Letter of Credit.
(b) In the event that the Borrower shall fail to reimburse any Issuer,
or if for any reason Revolving Loans shall not be made to fund any
Reimbursement Obligation, all as provided in Section 4.5 and in an amount
equal to the amount of any drawing honored by such Issuer under a Letter of
Credit issued by it, or in the event such Issuer must for any reason return
or disgorge such reimbursement, such Issuer shall promptly notify each
Lender of the unreimbursed amount of such drawing and of such Lender's
respective participation therein. Each Lender shall make available to such
Issuer, whether or not any Default shall have occurred and be continuing,
an amount equal to its respective participation in same day or immediately
available funds at the office of such Issuer specified in such notice not
later than 11:00 a.m., New York City time, on the Business Day (under the
laws of the jurisdiction of such Issuer) after the date notified by such
Issuer. In the event that any Lender fails to make available to such
Issuer the amount of such Lender's participation in such Letter of Credit
as provided herein, such Issuer shall be entitled to recover such amount on
demand from such Lender together with interest at the daily average Federal
Funds Effective Rate for three Business Days (together with such other
compensatory amounts as may be required to be paid by such Lender to the
Agent pursuant to the Rules for Interbank Compensation of the council on
International Banking or the Clearinghouse Compensation Committee, as the
case may be, as in effect from time to time) and thereafter at the Federal
Funds Effective Rate plus 2.0%.
(c) Nothing in this Section shall be deemed to prejudice the right of
any Lender to recover from any Issuer any amounts made available by such
Lender to such Issuer pursuant to this Section in the event that it is
determined by a court of competent jurisdiction that the payment with
respect to a Letter of Credit by such Issuer in respect of which payment
was made by such Lender constituted gross negligence or wilful misconduct
on the part of such Issuer.
(d) Each Issuer shall distribute to each other Lender which has paid
all amounts payable by it under this Section with respect to any Letter of
Credit issued by such Issuer such other Lender's Percentage of all payments
received by such Issuer from the Borrower in reimbursement of drawings
honored by such Issuer under such Letter of Credit when such payments are
received.
SECTION 4.5. Disbursements. (a) The applicable Issuer will notify the
Borrower and the Agent promptly of the presentment for payment of any drawing
under any Letter of Credit, together with notice of the amount of such drawing
and the date (a "Disbursement Date") such payment shall be made.
(b) Subject to the terms and provisions of such Letter of Credit, the
applicable Issuer shall make such payment to the beneficiary (or its designee)
of such Letter of Credit.
(c) Prior to 12:00 noon, New York City time, on the Business Day
immediately succeeding the Disbursement Date, the Borrower will reimburse the
applicable Issuer for all amounts which it has disbursed under such Letter of
Credit.
(d) To the extent the applicable Issuer is not reimbursed in full on
the Disbursement Date for all amounts it has disbursed under any Letter of
Credit, the Borrower's Reimbursement Obligation shall accrue interest from and
including such Disbursement Date to but excluding the date such Reimbursement
Obligation is paid in full (whether pursuant to a Borrowing of Base Rate Loans
under Section 4.5(e) or otherwise) at a fluctuating rate per annum equal to,
during the initial two days after such Disbursement Date, the Alternate Base
Rate and, thereafter, the Alternate Base Rate plus a margin of 2.0%, payable
on demand.
(e) In the event the applicable Issuer is not reimbursed by the
Borrower on the Disbursement Date, or if such Issuer must for any reason
return or disgorge such reimbursement, the Lenders (including such Issuer)
shall, on the terms and subject to the conditions of this Agreement, fund
the Reimbursement Obligation therefor by making, on the next Business Day,
Revolving Loans which are Base Rate Loans as provided in Section 2.1.1 (the
Borrower being deemed to have given a timely Borrowing Request therefor for
such amount); provided, however, for the purpose of determining the
availability of the Revolving Loan Commitments to make Revolving Loans
immediately prior to giving effect to the application of the proceeds of
such Revolving Loans, such Reimbursement Obligation shall be deemed not to
be outstanding at such time.
SECTION 4.6. Repayment/Reimbursement. The Borrower's obligation (a
"Reimbursement Obligation") under Section 4.5 to reimburse an Issuer with
respect to each disbursement thereunder (including interest thereon), and each
Lender's obligation to make participation payments in each drawing which has
not been reimbursed by the Borrower, shall be absolute and unconditional under
any and all circumstances and irrespective of any setoff, counterclaim, or
defense to payment which the Borrower may have or have had against any Lender
or any beneficiary of a Letter of Credit, including any defense based upon the
occurrence of any Default, any draft, demand or certificate or other document
presented under a Letter of Credit proving to be forged, fraudulent, invalid
or insufficient, the failure of any disbursement thereunder to conform to the
terms of the applicable Letter of Credit (if, in the applicable Issuer's good
faith opinion, such disbursement is determined to be appropriate) or any
non-application or misapplication by the beneficiary of the proceeds of such
disbursement, or the legality, validity, form, regularity, or enforceability
of such Letter of Credit.
SECTION 4.7. Deemed Disbursements and Cash Collateralization of Letters of
Credit. Upon the occurrence and during the continuation of any Event of
Default or the occurrence of the Revolving Loan Commitment Termination Date,
an amount equal to that portion of Letter of Credit Outstandings attributable
to outstanding and undrawn Letters of Credit shall, at the election of the
applicable Issuer acting on instructions from the Required Lenders, and
without demand upon or notice to the Borrower, be deemed to have been paid or
disbursed (but not for purposes of Sections 3.3 and 4.5) by such Issuer under
such Letters of Credit (notwithstanding that such amount may not in fact have
been so paid or disbursed), and, upon notification by such Issuer to the Agent
and the Borrower of its obligations under this Section (which notification
shall be deemed given if the applicable Event of Default is an Event of
Default with respect to the Borrower or ADT Limited described in clause (b) or
(d) of Section 9.1.9), the Borrower shall be immediately obligated to
reimburse such Issuer the amount deemed to have been so paid or disbursed by
such Issuer. Any amounts so received by such Issuer from the Borrower
pursuant to this Section shall be held as collateral security for the
repayment of the Borrower's obligations in connection with the Letters of
Credit issued by such Issuer. At any time when the aggregate amount held by
any Issuer as collateral hereunder shall exceed the then aggregate Letter of
Credit Outstandings in respect of all Letters of Credit issued by such Issuer,
such Issuer shall return to the Borrower such excess. At such time when all
Events of Default shall have been cured or waived, each Issuer shall return to
the Borrower all amounts then on deposit with such Issuer pursuant to this
Section. Any interest on such amounts on deposit shall be held by the
applicable Issuer as additional collateral security for the repayment of the
Borrower's Obligations in connection with the Letters of Credit issued by such
Issuer or otherwise.
SECTION 4.8. Nature of Repayment/Reimbursement Obligations. With
respect to all Letters of Credit, the Borrower shall assume all risks of
the acts, omissions, or misuse of any Letter of Credit by the beneficiary
thereof. Neither any Issuer nor any Lender (except to the extent of its
own gross negligence or wilful misconduct) shall be responsible for:
(a) the form, validity, sufficiency, accuracy, genuineness, or legal
effect of any Letter of Credit or any document submitted by any party in
connection with the application for and issuance of a Letter of Credit,
even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent, or forged;
(b) the form, validity, sufficiency, accuracy, genuineness, or
legal effect of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or
benefits thereunder or proceeds thereof in whole or in part, which
may prove to be invalid or ineffective for any reason;
(c) failure of the beneficiary to comply fully with conditions
required in order to demand payment under a Letter of Credit;
(d) errors, omissions, interruptions, or delays in transmission or
delivery of any messages, by mail, cable, telegraph, telex, or
otherwise; or
(e) any loss or delay in the transmission or otherwise of any
document or draft required in order to make a Disbursement under a
Letter of Credit or of the proceeds thereof.
None of the foregoing shall affect, impair, or prevent the vesting of any of
the rights or powers granted any Issuer or any Lender hereunder. In
furtherance and extension, and not in limitation or derogation, of any of the
foregoing, any action taken or omitted to be taken by any Issuer in good faith
shall be binding upon the Borrower and shall not put such Issuer under any
resulting liability to the Borrower.
SECTION 4.9. Increased Costs; Indemnity. With respect to all Letters of
Credit, if by reason of
(a) any change after the date hereof in applicable law, regulation,
rule, decree or regulatory requirement or any change in the
interpretation or application by any judicial or regulatory authority
of any law, regulation, rule, decree or regulatory requirement, or
(b) compliance by any Issuer or any Lender with any direction,
request or requirement (whether or not having the force of law) of
any governmental or monetary authority, including Regulation D of the
F.R.S. Board, first issued after the date hereof:
(i) any Issuer or any Lender shall be subject to any tax
(other than taxes on net income and franchises), levy, charge
or withholding of any nature or to any variation thereof or to
any penalty with respect to the maintenance or fulfillment of
its obligations under this Article IV, whether directly or by
such being imposed on or suffered by such Issuer or any Lender;
(ii) any reserve, deposit or similar requirement is or shall
be applicable, imposed or modified in respect of any Letters of
Credit issued by any Issuer or participations therein purchased
by any Lender; or
(iii) there shall be imposed on any Issuer or any Lender any
other condition regarding this Article IV, any Letter of Credit
or any participation therein;
and the result of the foregoing is directly or indirectly to increase the
actual cost to such Issuer or such Lender of issuing, making or maintaining
any Letter of Credit or of purchasing or maintaining any participation
therein, or to actually reduce any amount receivable in respect thereof by
such Issuer or such Lender, then and in any such case such Issuer or such
Lender may, at any time after the additional cost is incurred or the amount
received is reduced, notify the Borrower thereof, and the Borrower shall pay
within fourteen days of demand thereof such amounts as such Issuer or Lender
may specify to be necessary to compensate such Issuer or Lender for such
additional cost or reduced receipt, together with interest on such amount from
the date demanded until payment in full thereof at a rate equal, during the
initial fifteen Business Days after the date of such demand, the Alternate
Base Rate, and, thereafter, the Alternate Base Rate plus a margin of 2.0%;
provided, however, that the Borrower shall have no obligation to pay any such
additional amount with respect to any day or days unless such Issuer or Lender
shall have notified the Borrower of its demand therefor within 60 days of the
date upon which such Issuer or Lender has obtained audited information with
respect to the fiscal year of such Issuer or Lender in which such day or days
occurred; provided further, however, that each such Issuer or Lender will use
all reasonable efforts to obtain such audited information in a timely manner.
The determination by such Issuer or Lender, as the case may be, of any amount
due pursuant to this Section, as set forth in a statement setting forth the
calculation thereof in reasonable detail, shall, in the absence of manifest
error, be final and conclusive and binding on all of the parties hereto. In
addition to amounts payable as elsewhere provided in this Article IV, the
Borrower hereby agrees to protect, indemnify, pay and save each Issuer
harmless from and against any and all claims, demands, liabilities, damages,
losses, costs, charges and expenses (including reasonable attorneys' fees and
allocated costs of internal counsel) which such Issuer may incur or be subject
to as a consequence, direct or indirect, of
(x) the issuance of the Letters of Credit, other than as a result of
the gross negligence or wilful misconduct of such Issuer as determined
by a court of competent jurisdiction, or
(y) the failure of such Issuer to honor a drawing under any Letter of
Credit as a result of any act or omission, whether rightful or wrongful,
of any present or future de jure or de facto government or governmental
authority.
ARTICLE V
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 5.1. LIBO Rate Lending Unlawful. If any Lender shall determine
(which determination shall, upon notice thereof to the Borrower and the
Lenders, be conclusive and binding on the Borrower) that the introduction of,
or any change in or in the interpretation of, any law makes it unlawful, or
any central bank or other governmental authority asserts that it is unlawful,
for such Lender to make, continue or maintain any Loan as, or to convert any
Loan into, a LIBO Rate Loan, the obligations of such Lender to make, continue
or maintain any Loan as, or to convert any Loan into, a LIBO Rate Loan shall,
upon such determination, forthwith be suspended until such Lender shall notify
the Agent that the circumstances causing such suspension no longer exist, and
all LIBO Rate Loans of such Lender shall automatically convert into Base Rate
Loans at the end of the then current Interest Periods with respect thereto or
sooner, if required by such law or assertion and all Loans of such Lender that
would otherwise have been made or continued as, or converted into, LIBO Rate
Loans shall instead be made as or converted into, or continued as, Base Rate
Loans upon which interest shall be payable (i) in the case of Revolving Loans,
at the same time as the related LIBO Rate Loans and (ii) in the case of
Competitive Bid Loans, on the Competitive Bid Loan Interest Payment Date with
respect thereto.
SECTION 5.2. Deposits Unavailable. If the Agent shall have determined
that
(a) Dollar deposits in the relevant amount and for the relevant
Interest Period are not available to the Reference Lender or the
Reference Lenders, as the case may be, in their relevant market; or
(b) by reason of circumstances affecting the Reference Lenders'
relevant market, adequate means do not exist for ascertaining the
interest rate applicable hereunder to LIBO Rate Loans,
then, upon notice from the Agent to the Borrower and the Lenders, the
obligations of all Lenders under Section 2.2 and Section 2.4 to make or
continue any Revolving Loans as, or to convert any Revolving Loans into, LIBO
Rate Loans shall forthwith be suspended until the Agent shall notify the
Borrower and the Lenders that the circumstances causing such suspension no
longer exist.
SECTION 5.3. Increased LIBO Rate Loan Costs, etc. The Borrower agrees
to reimburse each Lender for any increase in the actual cost to such Lender
of, or any actual reduction in the amount of any sum receivable by such
Lender in respect of, making, continuing or maintaining (or of its
obligation to make, continue or maintain) any Loans as, or of converting
(or of its obligation to convert) any Loans into, LIBO Rate Loans arising
by reason of (i) any change (after the date hereof, in respect of LIBO Rate
Loans that are Revolving Loans, or after the date of the applicable
Competitive Bid Loan Offer, in respect of Competitive Bid Loans) in any
applicable law, rule, regulation, decree or regulatory requirement or any
change (after such date) in the interpretation or application by any
judicial or regulatory authority of any applicable law, rule, regulation,
decree or regulatory requirement or (ii) compliance by such Lender with any
direction, request or requirement (whether or not having the force of law)
of any governmental or monetary authority, including Regulation D of the
F.R.S. Board, first issued after such date; provided, however, that the
Borrower shall have no obligation to pay any such additional amount with
respect to any day or days unless such Lender shall have notified the
Borrower of its demand therefor within 60 days of the date upon which such
Lender has obtained audited information with respect to the fiscal year of
such Lender in which such day or days occurred; provided further, however,
that each such Lender will use all reasonable efforts to obtain such
audited information in a timely manner. Such Lender shall promptly notify
the Agent and the Borrower in writing of the occurrence of any such event,
such notice to state, in reasonable detail, the reasons therefor and the
additional amount required fully to compensate such Lender for such
increased cost or reduced amount. Such additional amounts shall be payable
by the Borrower directly to such Lender within fourteen days of its receipt
of such notice, and such notice shall, in the absence of manifest error, be
conclusive and binding on the Borrower.
SECTION 5.4. Funding Losses. In the event any Lender shall incur any
loss or expense (including any loss or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such Lender
to make, continue or maintain any portion of the principal amount of any Loan
as, or to convert any portion of the principal amount of any Loan into, a LIBO
Rate Loan) as a result of
(a) any conversion or repayment or prepayment of the principal
amount of any LIBO Rate Loans on a date other than the scheduled last
day of the Interest Period applicable thereto, whether pursuant to
Section 3.1 or otherwise;
(b) any Loans not being made as LIBO Rate Loans in accordance with
the Borrowing Request therefor; or
(c) any Revolving Loans not being continued as, or converted into,
LIBO Rate Loans in accordance with the Continuation/Conversion Notice
therefor,
but excluding loss of margin for the period after such payment, conversion or
failure to borrow, then, upon the written notice of such Lender to the
Borrower (with a copy to the Agent), the Borrower shall, within fourteen days
of its receipt thereof, pay directly to such Lender such amount as will (in
the reasonable determination of such Lender) reimburse such Lender for such
loss or expense. Such written notice (which shall include calculations in
reasonable detail) shall, in the absence of manifest error, be conclusive and
binding on the Borrower.
SECTION 5.5. Increased Capital Costs. If after the date hereof (or,
with respect to any Competitive Bid Loan, the date of the Competitive Bid Loan
Offer with respect thereto), there shall be any change in, or the
introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in of, any law or regulation, directive, guideline, decision or request
(whether or not having the force of law) of any court, central bank, regulator
or other governmental authority affects or would affect the amount of capital
required or expected to be maintained by any Lender or any Person controlling
such Lender, and such Lender determines (in its sole and absolute discretion)
that the rate of return on its or such controlling Person's capital as a
consequence of its Revolving Loan Commitment, issuance of or participation in
Letters of Credit or the Loans made by such Lender is reduced to a level below
that which such Lender or such controlling Person could have achieved but for
the occurrence of any such circumstance, then, in any such case upon notice
from time to time by such Lender to the Borrower, the Borrower shall, within
fourteen days of its receipt of such notice from such Lender, pay directly to
such Lender additional amounts sufficient to compensate such Lender or such
controlling Person for such reduction in rate of return; provided, however,
that the Borrower shall have no obligation to pay any such additional amount
with respect to any day or days unless such Lender shall have notified the
Borrower of its demand therefor within 60 days of the date upon which such
Lender has obtained audited information with respect to the fiscal year of
such Lender in which such day or days occurred; provided further, however,
that each such Lender will use all reasonable efforts to obtain such audited
information in a timely manner. A statement of such Lender as to any such
additional amount or amounts (including calculations thereof in reasonable
detail) shall, in the absence of manifest error, be conclusive and binding on
the Borrower. In determining such amount, such Lender may use any reasonable
method of averaging and attribution that it shall deem applicable.
SECTION 5.6. Taxes. All payments by the Borrower of principal of, and
interest on, the Loans and all other amounts payable hereunder shall be made
free and clear of and without deduction for any present or future income,
excise, stamp or franchise taxes, and other taxes, fees, duties, withholdings
and all liabilities related thereto, imposed by any taxing authority and
arising as a result of any change after the date hereof (or, in the case of
any Competitive Bid Loan, after the date of the Competitive Bid Loan Offer
with respect thereto) in any law, regulation or treaty or the interpretation
or application thereof by any relevant taxing authority, but excluding
franchise taxes and taxes imposed on or measured by any Lender's net income or
receipts (such non-excluded items being called "Taxes"). In the event that
any withholding or deduction from any payment to be made by the Borrower
hereunder is required in respect of any Taxes pursuant to any applicable law,
rule or regulation, then the Borrower will
(a) pay directly to the relevant authority the full amount required
to be so withheld or deducted;
(b) promptly forward to the Agent an official receipt or other
documentation satisfactory to the Agent evidencing such payment to
such authority; and
(c) pay to the Agent for the account of the Lenders such additional
amount or amounts as is necessary to ensure that the net amount
actually received by each Lender will equal the full amount such
Lender would have received had no such withholding or deduction been
required.
Moreover, if any Taxes are directly asserted against the Agent or any Lender
with respect to any payment received by the Agent or such Lender hereunder,
the Agent or such Lender may pay such Taxes and the Borrower will promptly pay
such additional amounts (including any penalties, interest or expenses) as is
necessary in order that the net amount received by such person after the
payment of such Taxes (including any Taxes on such additional amount) shall
equal the amount such person would have received had not such Taxes been
asserted; provided, however, that the Borrower shall have no obligation to pay
any such additional amount unless such Lender shall have notified the Borrower
of its demand therefor within 60 days of the date upon which such Lender has
obtained audited information with respect to the fiscal year of such Lender
during which the payment of such additional amounts occurred; provided
further, however, that each such Lender will use all reasonable efforts to
obtain such audited information in a timely manner.
If the Borrower fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the Agent, for the account of the
respective Lenders, the required receipts or other required documentary
evidence, the Borrower shall indemnify the Lenders for any incremental Taxes,
interest or penalties that may become payable by any Lender as a result of any
such failure. For purposes of this Section 5.6, a distribution hereunder by
the Agent or any Lender to or for the account of any Lender shall be deemed a
payment by the Borrower.
Each Lender that is organized under the laws of a jurisdiction other
than the United States (or any state thereof or the District of Columbia)
shall provide its portion of the Revolving Loan Commitment through a branch or
office the income of which that relates hereto is effectively connected with
the conduct of a trade or business in the United States. On or prior to the
Effective Date (in the case of any Lender party hereto on the Effective Date
or the Agent) or the date upon which such Lender or Agent becomes a Lender or
Agent hereunder (in the case of any other Lender or Agent) and from time to
time thereafter as the Borrower may reasonably request (which request shall
not be made more than once per Fiscal Year), each Lender and Agent that is
organized under the laws of a jurisdiction other than the United States (or
any state thereof or the District of Columbia) shall execute and deliver to
the Borrower and the Agent one or more (as the Borrower or the Agent may
reasonably request) United States Internal Revenue Service Forms 4224 or such
other forms or documents (or successor forms or documents), appropriately
completed, as may be applicable to establish the extent, if any, to which a
payment to such Lender or Agent is exempt from withholding or deduction of
Taxes. If the form provided by any Lender or the Agent at the time such
Lender or the Agent first becomes a party to this Agreement indicates a
withholding or deduction of taxes at a rate in excess of zero, withholding or
deduction of taxes at such rate shall be excluded from "Taxes" as defined in
this Section 5.6; provided, however, that any increase in such rate shall not
be so excluded from "Taxes". For any period with respect to which a Lender
has failed to provide the Borrower with the appropriate form pursuant to this
Section 5.6, such Lender shall not be entitled to receive any additional
amount pursuant to this Section 5.6.
SECTION 5.7. Payments, Computations, etc. Unless otherwise expressly
provided, all payments by the Borrower pursuant to this Agreement, the Notes
or any other Loan Document shall be made by the Borrower to the Agent for the
pro rata account of the Lenders entitled to receive such payment. All such
payments required to be made to the Agent shall be made, without setoff,
deduction or counterclaim, not later than 12:00 noon, New York City time, on
the date due, in same day or immediately available funds, to such account as
the Agent shall specify from time to time by notice to the Borrower. Funds
received after that time shall be deemed to have been received by the Agent on
the next succeeding Business Day. The Agent shall promptly remit in same day
funds to each Lender its share, if any, of such payments received by the Agent
for the account of such Lender. All interest and fees shall be computed on
the basis of the actual number of days (including the first day but excluding
the last day) occurring during the period for which such interest or fee is
payable over a year comprised of 360 days (or, in the case of interest on a
Base Rate Loan (other than when calculated with respect to the Federal Funds
Effective Rate), 365 days or, if appropriate, 366 days). Whenever any payment
to be made shall otherwise be due on a day which is not a Business Day, such
payment shall (except as otherwise required by clause (b) of the definition of
the term "Interest Period" with respect to LIBO Rate Loans) be made on the
next succeeding Business Day and such extension of time shall be included in
computing interest and fees, if any, in connection with such payment.
SECTION 5.8. Sharing of Payments. If any Lender shall obtain any payment
or other recovery (whether voluntary, involuntary, by application of setoff or
otherwise) on account of any Revolving Loan (other than pursuant to the terms
of Sections 5.3, 5.4 and 5.5) or any Letter of Credit in excess of its pro
rata share of payments then or therewith obtained by all Lenders, such Lender
shall purchase from the other Lenders such participations in Revolving Loans
made by them and/or Letters of Credit as shall be necessary to cause such
purchasing Lender to share the excess payment or other recovery ratably with
each of them; provided, however, that if all or any portion of the excess
payment or other recovery is thereafter recovered from such purchasing Lender,
the purchase shall be rescinded and each Lender which has sold a participation
to the purchasing Lender shall repay to the purchasing Lender the purchase
price to the ratable extent of such recovery together with an amount equal to
such selling Lender's ratable share (according to the proportion of
(a) the amount of such selling Lender's required repayment to the
purchasing Lender
to
(b) the total amount so recovered from the purchasing Lender)
of any interest or other amount paid or payable by the purchasing Lender in
respect of the total amount so recovered. The Borrower agrees that any Lender
so purchasing a participation from another Lender pursuant to this Section
may, to the fullest extent permitted by law, exercise all its rights of
payment (including pursuant to Section 5.9) with respect to such participation
as fully as if such Lender were the direct creditor of the Borrower in the
amount of such participation. If under any applicable bankruptcy, insolvency
or other similar law, any Lender receives a secured claim in lieu of a setoff
to which this Section applies, such Lender shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent
with the rights of the Lenders entitled under this Section to share in the
benefits of any recovery on such secured claim.
SECTION 5.9. Setoff. Each Lender shall, upon the occurrence of any
Event of Default, to the fullest extent permitted under applicable law, have
the right to appropriate and apply to the payment of the Obligations owing
to it (whether or not then due) any and all balances, credits, deposits,
accounts or moneys of the Borrower then or thereafter maintained with or
otherwise held by such Lender; provided, however, that any such
appropriation and application shall be subject to the provisions of Section
5.8. Each Lender agrees promptly to notify the Borrower and the Agent
after any such setoff and application made by such Lender; provided,
however, that, to the fullest extent permitted under applicable law, the
failure to give such notice shall not affect the validity of such setoff
and application. The rights of each Lender under this Section are in
addition to other rights and remedies (including other rights of setoff
under applicable law or otherwise) which such Lender may have.
SECTION 5.10. Use of Proceeds. The proceeds of any Loans shall be used
for general corporate purposes, including to provide working capital and to
finance acquisitions permitted hereunder in Core Businesses. Without limiting
the foregoing, no proceeds of any Loan shall be used to acquire any equity
security of a class which is registered pursuant to Section 12 of the Exchange
Act or any "margin stock", as defined in F.R.S. Board Regulation U.
SECTION 5.11. Use of Letters of Credit. Letters of Credit shall be
used for general corporate purposes, including:
(a) as credit support for corporate insurance purposes;
(b) as credit support for working capital facilities provided to
Affiliates of the Borrower; and
(c) in support of trade obligations.
SECTION 5.12. Substitution of LIBOR Office or Domestic Office in Certain
Circumstances. If any Lender would otherwise (a) have its obligation to make,
continue or maintain Loans as, or convert Loans into, LIBO Rate Loans
suspended pursuant to Section 5.1 or (b) be entitled to receive additional
amounts pursuant to Section 5.3, 5.5 or 5.6, such Lender shall designate a
different Domestic Office or LIBOR Office, as the case may be, if such
designation will avoid the need for such suspension or eliminate or reduce the
amounts of such additional amounts and will not, in the sole judgment of such
Lender, be otherwise disadvantageous to such Lender.
SECTION 5.13. Substitution of Bank; Election to Terminate. If (a) the
obligation of any Lender to make, continue or maintain Loans as, or to convert
Revolving Loans into, LIBO Rate Loans has been suspended pursuant to Section
5.1 or (b) any Lender has demanded to be paid additional amounts pursuant to
Section 5.3, 5.5 or 5.6 (and the Borrower, in its reasonable judgment, believes
such Lender is likely to demand additional amounts thereunder), the Borrower
shall have the right, with the assistance of the Agent, to seek one or more
financial institutions (a "Substitute Lender"), which may be one or more of
the Lenders, to purchase the Notes and assume the Revolving Loan Commitment of
such Lender (the "Affected Lender"), and if the Borrower locates a Substitute
Lender, the Affected Lender shall, upon (i) payment to it of the purchase
price agreed between it and the Substitute Lender (or, failing such agreement,
a purchase price in the amount of the outstanding principal amount of its
Loans and accrued interest thereon to the date of payment) plus any amount
(other than principal and interest) then due to it or accrued for its account
hereunder, (ii) the written consent of each Issuer (which consent shall be
based on such Issuer's reasonable determination of the ability of such
Substitute Lender to meet the financial obligations of a Lender hereunder) and
(iii) payment by the Borrower to the Affected Lender and the Agent of all
reasonable out-of-pocket expenses in connection with such assignment and
assumption, assign all its rights and obligations under this Agreement and the
Notes (including its Revolving Loan Commitment and its Loans) to the
Substitute Lender, and the Substitute Lender shall assume such rights and
obligations, whereupon the Substitute Lender shall become a party hereto and
shall have the rights and obligations of a Lender hereunder and under the
other Loan Documents and the Affected Lender shall be released from its
obligations hereunder and under the other Loan Documents.
ARTICLE VI
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
SECTION 6.1. [INTENTIONALLY OMITTED]
SECTION 6.2. All Credit Extensions. The obligation of each Lender to
make any Credit Extension shall be subject to the satisfaction of each of the
conditions precedent set forth in this Section 6.2.
SECTION 6.2.1. Compliance with Warranties, No Default, etc. Both before
and after giving effect to any Credit Extension (but, if any Default of the
nature referred to in Section 9.1.5 shall have occurred with respect to any
other Indebtedness, without giving effect to the application, directly or
indirectly, of the proceeds of any Borrowing to the payment of any
Indebtedness involved in such Default) the following statements shall be
true and correct
(a) the representations and warranties set forth in Article VII
(excluding, however, those contained in Section 7.6) and Article III
of the ADT Limited Guaranty (excluding, however, those contained in
Section 3.7 of the ADT Limited Guaranty) shall be true and correct
with the same effect as if then made (unless stated to relate solely
to an earlier date, in which case such representations and warranties
shall be true and correct as of such earlier date);
(b) (i) except as disclosed by the Borrower or ADT Limited to the
Agent and the Lenders pursuant to, or as excepted from, Section 7.6 or
Section 3.7 of the ADT Limited Guaranty, no labor controversy,
litigation, arbitration or governmental investigation or proceeding
shall be pending or, to the knowledge of the Borrower or ADT Limited,
threatened against ADT Limited, the Borrower or any of their
respective Subsidiaries which might reasonably be expected to
materially adversely affect the consolidated business, operations,
assets, revenues, properties or prospects of ADT Limited and its
Subsidiaries or the Borrower and its Subsidiaries or which purports
to affect the legality, validity or enforceability of this Agreement,
the Notes or any other Loan Document; and
(ii) no development shall have occurred in any labor controversy,
litigation, arbitration or governmental investigation or proceeding
disclosed pursuant to, or as excepted from, Section 7.6 or Section
3.7 of the ADT Limited Guaranty which might reasonably be expected to
materially adversely affect the consolidated businesses, operations,
assets, revenues, properties or prospects of ADT Limited and its
Subsidiaries or the Borrower and its Subsidiaries;
(c) no Default shall have then occurred and be continuing; and
(d) except in the case of the deemed issuance of Letters of Credit
pursuant to the last sentence of Section 4.1, with respect to the
issuance, extension or renewal by an Issuer of any Letter of Credit,
no order, judgment or decree of any court, arbitrator or governmental
authority shall purport to enjoin or restrain such Issuer from
issuing letters of credit generally or the Letter of Credit to be
issued by it pursuant to the applicable Issuance Request and no
request or directive (whether or not having the force of law) from
any governmental authority with jurisdiction over the Agent or the
Issuer shall prohibit or request that the Agent or the Issuer refrain
from the issuance of letters of credit generally or such Letter of
Credit in particular.
SECTION 6.2.2. Credit Extension Request. Except in the case of Letters
of Credit deemed issued pursuant to the last sentence of Section 4.1, the
Agent shall have received a Borrowing Request or Issuance Request, as the
case may be, for such Credit Extension. Each of the delivery of a
Borrowing Request or an Issuance Request and the acceptance by the Borrower
of the proceeds of any Borrowing or the issuance, deemed issuance,
extension or renewal of any Letter of Credit, as applicable, shall
constitute a representation and warranty by the Borrower that on the date
of such Borrowing (both immediately before and after giving effect to such
Borrowing and the application of the proceeds thereof) or the issuance,
extension or renewal of such Letter of Credit, as applicable, the
statements made in clauses (a), (b) and (c) of Section 6.2.1 are true and
correct.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders and the Agent to enter into this
Agreement and to make Loans and issue Letters of Credit hereunder, the
Borrower represents and warrants unto the Agent and each Lender as set forth
in this Article VII.
SECTION 7.1. Organization, etc. Each of the Borrower and its
Subsidiaries that is an Obligor is a corporation duly organized and validly
existing and in good standing under the laws of the State of its
incorporation, is duly qualified to do business and is in good standing as
a foreign corporation in each jurisdiction where the nature of its business
or the location of its assets requires such qualification and where the
failure to so qualify or be in good standing would reasonably be expected
to have a material adverse effect on the business, results of operations,
financial condition or prospects of the Borrower and its Subsidiaries taken
as a whole. Each of the Borrower and its Subsidiaries that is an Obligor
has full power and authority and holds all requisite governmental licenses,
permits and other approvals (i) to own and hold under lease its property
and to conduct its business substantially as currently conducted by it,
except where failure to hold such licenses, permits and other approvals
would not reasonably be expected to have a material adverse effect on the
business, results of operations, financial condition or prospects of the
Borrower and its Subsidiaries taken as a whole and (ii) to enter into and
perform its Obligations under each Loan Document to which it is a party.
SECTION 7.2. Due Authorization, Non-Contravention, etc. The execution,
delivery and performance by the Borrower of this Agreement, the Notes and each
other Loan Document executed or to be executed by it, and the execution,
delivery and performance by each Subsidiary of the Borrower that is an Obligor
of each Loan Document executed or to be executed by it are within the
Borrower's and each such Obligor's corporate powers, have been duly authorized
by all necessary corporate action, and do not
(a) contravene the Borrower's or any such Obligor's Organic
Documents;
(b) contravene any contractual restriction, law or governmental
regulation or court decree or order binding on or affecting the
Borrower or any such Obligor in any manner that could reasonably be
expected (i) to have a material adverse effect on the business,
results of operations, financial condition or prospects of the
Borrower and its Subsidiaries taken as a whole or (ii) to subject any
Lender, Issuer or Agent to any liability; or
(c) result in, or require the creation or imposition of, any Lien on
any of any Obligor's properties.
SECTION 7.3. Government Approval, Regulation, etc. No authorization
or approval or other action by, and no notice to or filing with, any
governmental authority or regulatory body or other Person is required for
the due execution, delivery or performance by the Borrower or any
Subsidiary of the Borrower that is an Obligor of this Agreement, the Notes
or any other Loan Document to which it is a party. Neither the Borrower
nor any of its Subsidiaries that is an Obligor is an "investment company"
within the meaning of the Investment Company Act of 1940, as amended, or a
"holding company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
SECTION 7.4. Validity, etc. This Agreement, the Notes and each
other Loan Document executed by the Borrower constitute the legal, valid
and binding obligations of the Borrower enforceable in accordance with
their respective terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws from time to time in effect
affecting creditors' rights generally and to general principles of equity.
SECTION 7.5. No Material Adverse Change. Since December 31, 1995,
there has been no material adverse change in the business, results of
operations, financial condition or prospects of the Borrower and its
Subsidiaries taken as a whole.
SECTION 7.6. Litigation, Labor Controversies, etc. There is no
pending or, to the knowledge of the Borrower, threatened litigation,
action, proceeding, or labor controversy affecting the Borrower or any of
its Subsidiaries, or any of their respective properties, businesses, assets
or revenues, which could reasonably be expected to materially adversely
affect the financial condition, results of operations, business or
prospects of the Borrower and its Subsidiaries, taken as a whole, or which
purports to affect the legality, validity or enforceability of this
Agreement, the Notes or any other Loan Document, except as disclosed in
Item 7.6 ("Litigation") of the Disclosure Schedule.
SECTION 7.7. Subsidiaries. The Borrower has no Subsidiaries,
except those Subsidiaries
(a) which are identified in Item 7.7 ("Existing Subsidiaries") of
the Disclosure Schedule; or
(b) which are permitted to have been created or acquired in
accordance with Section 4.2.5 or 4.2.9 of the ADT Limited Guaranty.
Without limiting any term or provision hereof, to the extent any Person
becomes a Subsidiary of the Borrower in accordance with (and not in
contravention of) any term or provision hereof, the ADT Limited Guaranty or
any other Loan Document, the Borrower may supplement such Item 7.7 of the
Disclosure Schedule to include such new Subsidiary by delivering a
certificate, signed by an Authorized Officer of the Borrower, certifying
(i) as to the name and place of organization of such new Subsidiary, (ii)
as to the method by which such new Subsidiary was created and (iii) that
such new Subsidiary was created without contravening any term or provision
of this Agreement, the ADT Limited Guaranty or any other Loan Document.
SECTION 7.8. Seniority of the Obligations. The Obligations of the
Borrower are senior to all Indebtedness of the Borrower in respect of the
Senior Subordinated Notes and the XXXXx, and the Obligations of ADT Limited
are senior to all Indebtedness of ADT Limited in respect of the Senior
Subordinated Note Guarantee and the XXXXx Guarantee, and constitute, and
are entitled to the benefits of being, (i) "Senior Indebtedness" and
"Guarantor Senior Indebtedness", as such terms are defined in the Senior
Subordinated Note Indenture, and (ii) "Senior Indebtedness" and "Guarantor
Senior Indebtedness", as such terms are defined in the XXXXx Indenture.
SECTION 7.9. Existing Letters of Credit. Item 7.9 ("Existing
Letters of Credit") of the Disclosure Schedule lists each Existing Letter
of Credit.
ARTICLE VIII
COVENANTS
SECTION 8.1. Affirmative Covenants. The Borrower agrees with the
Agent and each Lender that, until the Covenant Termination Date, the
Borrower will perform the obligations set forth in this Section 8.1.
SECTION 8.1.1. Financial Information, Reports, Notices, etc.
The Borrower will furnish, or will cause to be furnished, to each
Lender and the Agent copies of the following financial statements,
reports, notices and information:
(a) no later than the filing of each 10-K of ADT
Limited, but in no event later than 120 days after the end of
each Fiscal Year, copies of the audited annual financial
statements for such Fiscal Year for each of the Borrower and
its Subsidiaries and ADT Limited and its Subsidiaries, in
each case including therein consolidated balance sheets for
each of the Borrower and its Subsidiaries and ADT Limited and
its Subsidiaries as of the end of such Fiscal Year and
consolidated statements of income, cash flow and changes in
shareholders' equity of each of the Borrower and its
Subsidiaries and ADT Limited and its Subsidiaries for such
Fiscal Year, in each case, reported on (without any
Impermissible Qualification) as to fairness of presentation,
generally accepted accounting principles and consistency by
Coopers & Xxxxxxx, or other independent public accountants of
nationally recognized standing, together with a certificate
from such accountants stating whether, in making the
examination necessary for such report, such accountants have
become aware of any Default that has occurred and is
continuing;
(b) [intentionally omitted];
(c) promptly and in any event prior to the 30th day of
each Fiscal Year, a certified copy of the annual budget of
the Borrower, ADT Limited and its other Subsidiaries, on a
consolidated basis, for such Fiscal Year, in form and scope
consistent with the annual budget of the Borrower, ADT
Limited and its other Subsidiaries, on a consolidated basis,
for the 1996 Fiscal Year furnished to the Agent prior to the
Effective Date;
(d) promptly and in any event within 60 days after the
end of each of the first three Fiscal Quarters of each Fiscal
Year, quarterly unaudited consolidated balance sheets as of
the end of such Fiscal Quarter for each of the Borrower and
its Subsidiaries and ADT Limited and its Subsidiaries, and
quarterly unaudited consolidated statements of income, cash
flow and changes in shareholders' equity of each of the
Borrower and its Subsidiaries and ADT Limited and its
Subsidiaries for such Fiscal Quarter and for the period
commencing at the end of the previous Fiscal Year and ending
with the end of such Fiscal Quarter, in each case, certified
(subject to normal year-end adjustments) as to fairness of
presentation, generally accepted accounting principles and
consistency by the chief financial Authorized Officer of such
Person;
(e) within ten Business Days of the delivery of the
financial statements required by clauses (a) and (d) of this
Section, a Compliance Certificate, executed by the chief
financial Authorized Officer of ADT Limited, (i) showing (in
reasonable detail and with appropriate calculations and
computations in all respects reasonably satisfactory to the
Agent) compliance with the financial covenants set forth in
Section 8.2.3 and Sections 4.2.4, 4.2.6 and 4.2.7 of the ADT
Limited Guaranty and (ii) giving notice of the other items
referred to in the Compliance Certificate;
(f) promptly after the sending or filing thereof,
copies of all reports which ADT Limited sends to any class of
its security holders generally, and all reports and
registration statements (other than the exhibits thereto and
any registration statements on Form S-8 or its equivalent)
which ADT Limited or any of its Subsidiaries files with the
Securities and Exchange Commission (or any foreign
equivalent) or any national securities exchange, including,
without limitation, Form 10-Ks and 10-Qs for ADT Limited;
(g) as soon as possible and in any event within five
Business Days after any executive or financial officer of the
Borrower or ADT Limited obtains knowledge of the occurrence
of any Default, a statement of the chief financial Authorized
Officer of the Borrower setting forth details of such Default
and the action which the Borrower or ADT Limited has taken
and proposes to take with respect thereto;
(h) as soon as possible and in any event within five
Business Days after (x) the occurrence of any material
adverse development with respect to any litigation, action,
proceeding, or labor controversy described in Section 7.6 or
Section 3.7 of the ADT Limited Guaranty or (y) the
commencement of any labor controversy, litigation, action,
proceeding of the type described in Section 7.6 or Section
3.7 of the ADT Limited Guaranty, notice thereof describing in
reasonable detail such development or such labor controversy,
litigation, action or proceeding;
(i) immediately upon becoming aware of the institution
of any steps by the Borrower or any other Person to terminate
any Pension Plan, or the failure to make a required
contribution to any Pension Plan if such failure is
sufficient to give rise to a Lien under section 302(f) of
ERISA, or the taking of any action with respect to a Pension
Plan which could result in the requirement that the Borrower
furnish a bond or other security to the PBGC or such Pension
Plan, or the occurrence of any event with respect to any
Pension Plan which could result in the incurrence by the
Borrower of any material liability, fine or penalty, or any
material increase in the contingent liability of the Borrower
with respect to any post-retirement Welfare Plan benefit,
notice thereof and copies of all documentation relating
thereto; and
(j) such other information respecting the condition or
operations, financial or otherwise, of the Borrower, ADT
Limited or any other Subsidiary of ADT Limited as any Lender
through the Agent may from time to time reasonably request.
SECTION 8.1.2. Compliance with Laws, etc. The Borrower
will, and will cause each of its Subsidiaries to, comply in all
material respects with all applicable laws, rules, regulations and
orders, such compliance to include (without limitation):
(a) except to the extent permitted under Section 4.2.9
of the ADT Limited Guaranty, the maintenance and preservation
by the Borrower and each of its Subsidiaries that is an
Obligor of its corporate existence and qualification as a
foreign corporation in each jurisdiction where the nature of
its business or the location of its assets requires it to be
so qualified, except to the extent the failure to maintain
and preserve its corporate existence or to be so qualified
could not reasonably be expected to have a material adverse
effect on the business, results of operations, financial
condition or prospects of the Borrower and its Subsidiaries,
taken as a whole (it being acknowledged that the failure of
the Borrower to maintain and preserve its corporate existence
(except as permitted under Section 4.2.9 of the ADT Limited
Guaranty) shall be deemed to have such a material adverse
effect); and
(b) the payment, before the same become delinquent, of
all material taxes, assessments and governmental charges
imposed upon it or upon its property except to the extent
being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance
with GAAP shall have been set aside on its books.
SECTION 8.2. Negative Covenants. The Borrower agrees with
the Agent and each Lender that, until the Covenant Termination
Date, the Borrower will perform the obligations set forth in this
Section 8.2.
SECTION 8.2.1. Business Activities. The Borrower will not,
and will not permit any of its Subsidiaries to, engage in any
business activity, except for those activities conducted in
respect of the Core Businesses and the businesses identified in
Item 8.2.1 ("Permitted Existing Business Activities") of the
Disclosure Schedule, and such activities as may be incidental or
related thereto; provided, however, that the Borrower will not be
in default in the observance of this Section 8.2.1 if, as part of
the acquisition of a Core Business, the Borrower or its applicable
Subsidiary acquires a business or assets that would not
constitute, or be included in, a Core Business, so long as (i) the
primary purpose of such acquisition was the acquisition of such
Core Business, which acquisition could not have been consummated
on as commercially attractive terms without the acquisition of
such other business or assets, (ii) not less than 70% of the
assets acquired pursuant to such acquisition related at the time
of such acquisition to such Core Business, (iii) the Borrower or
such applicable Subsidiary is diligently pursuing the sale of such
other business or assets and (iv) such business or assets do not
have, and could not reasonably be expected to have, a material
adverse effect on the business, results of operations, financial
condition or prospects of the Borrower and its Subsidiaries taken
as a whole.
SECTION 8.2.2. Indebtedness. The Borrower will not, and
will not permit any of its Subsidiaries to, create, incur, assume
or suffer to exist or otherwise become or be liable in respect of
any Indebtedness, other than, without duplication, the following:
(a) Indebtedness in respect of the Credit Extensions
and other Obligations;
(b) Indebtedness in respect of the Senior Notes in an
aggregate principal amount not to exceed $250,000,000 at any
time outstanding;
(c) Indebtedness in respect of the Senior Subordinated
Notes in an aggregate principal amount not to exceed
$350,000,000 at any time outstanding;
(d) Indebtedness in respect of the XXXXx in an
aggregate principal amount equal to $297,373,612.50 plus the
amount of original issue discount accrued thereon through the
date such principal amount is determined, less the portion of
such amount represented by XXXXx which have been exchanged
for Common Shares;
(e) Indebtedness in respect of the Senior Note
Guarantees to the extent the guarantor under any such Senior
Note Guarantee is subject to a Guarantee that is in full
force and effect with respect to the Indebtedness referred to
in clause (a) above;
(f) (i) Indebtedness existing as of June 30, 1995;
provided that (A) such Indebtedness having a principal amount
in excess of $3,000,000 is identified in Item 8.2.2(f)
("Ongoing Indebtedness") of the Disclosure Schedule and
(B) true and correct copies of any indenture or agreement
governing such Indebtedness having a principal amount in
excess of $10,000,000 have been provided to the Agent and
(ii) Indebtedness of ADT Security Services in respect of the
Dividended Note;
(g) Indebtedness of ADT Automotive, ADT Auctions, Inc.,
ADT Property Holdings, Inc. and Auction Transport, Inc., each
a Delaware corporation and Wholly Owned Subsidiary of the
Borrower, incurred for cash management purposes in the
ordinary course of business in an aggregate principal amount
not to exceed $60,000,000 at any time outstanding, which
Indebtedness shall include the Indebtedness of ADT Automotive
under the facility agreement dated December 1, 1991, between
it and NBD Bank (the National Bank of Detroit);
(h) obligations of the Borrower or any of its
Subsidiaries pursuant to Hedging Arrangements designed to
protect the Borrower or any of its Subsidiaries against
fluctuations in interest rates in respect of Indebtedness of
the Borrower or such Subsidiary and not entered into for
purposes of speculation;
(i) obligations of the Borrower or any of its
Subsidiaries pursuant to Hedging Arrangements designed to
protect the Borrower or any of its Subsidiaries against
fluctuations in currency values and entered into in the
ordinary course of business and not for purposes of
speculation;
(j) unsecured Indebtedness incurred in the ordinary
course of business (including open accounts extended by
suppliers on normal trade terms in connection with purchases
of goods and services, but excluding Indebtedness incurred
through the borrowing of money or Contingent Liabilities in
respect of obligations of Persons other than the Borrower or
any of its Subsidiaries);
(k) Indebtedness in respect of Capitalized Lease
Liabilities and Indebtedness ("Capex Indebtedness") incurred
to finance the construction or acquisition of assets
permitted to be acquired or constructed pursuant to Section
4.2.7 of the ADT Limited Guaranty, to the extent a
Capitalized Lease Liability (assuming for the purposes of
this clause only that Capex Indebtedness constitutes a
Capitalized Lease Liability) could have been incurred under
such Section 4.2.7;
(l) Indebtedness of the Borrower and Subsidiary
Guarantors owing to the Borrower and Subsidiary Guarantors;
(m) Indebtedness of the Borrower and Subsidiary
Guarantors owing to Wholly Owned Subsidiaries of ADT Limited
(other than Indebtedness in respect of the Dividended Note),
provided that such Indebtedness constitutes Subordinated
Intercompany Debt or, to the extent not constituting
Subordinated Intercompany Debt, does not exceed at any time
outstanding $20,000,000;
(n) Indebtedness of Subsidiaries of the Borrower (other
than Subsidiary Guarantors) owing to ADT Limited;
(o) Indebtedness of Wholly Owned Subsidiaries of the
Borrower (other than Subsidiary Guarantors) owing to Wholly
Owned Subsidiaries of ADT Limited;
(p) Indebtedness consisting of guarantees, surety or
performance bonds or obligations in respect of purchase price
adjustments in connection with the acquisition or disposition
of assets;
(q) Indebtedness in respect of surety bonds and
performance bonds provided in the ordinary course of
business;
(r) Indebtedness which refinances Indebtedness
permitted by clauses (b), (c), (d), (e), (f), (g) and (k)
above; provided, however, that after giving effect to such
refinancing, (i) the principal amount of outstanding
Indebtedness is not increased, (ii) in the case of clauses
(b), (c), (d), (e) or (f), neither the tenor nor the average
life thereof is reduced, (iii) the respective obligor or
obligors shall be the same on the refinancing Indebtedness as
on the Indebtedness being refinanced, (iv) the security for
the refinancing Indebtedness shall be the same as that for
the Indebtedness being refinanced (except to the extent that
less security is granted to holders of refinancing
Indebtedness), (v) the holders of refinancing Indebtedness
are not afforded covenants, defaults, rights or remedies more
burdensome to the obligor or obligors than those contained in
the Indebtedness being refinanced and (vi) the refinancing
Indebtedness is subordinated to the same degree, if any, as
the Indebtedness being refinanced; and
(s) other Indebtedness of the Borrower and its
Subsidiaries to the extent that the amount of such
Indebtedness outstanding at any time, when added (without
duplication) to the aggregate amount of Indebtedness
outstanding at such time under clause (q) of Section 4.2.2 of
the ADT Limited Guaranty, does not exceed $75,000,000;
provided, however, that (i) no Indebtedness otherwise permitted by
clauses (m) or (s) shall be permitted if, after giving effect to
the incurrence thereof, any Event of Default shall have occurred
and be continuing and (ii) upon the occurrence of a Permitted
Auction Business Sale, all Auction Business Intercompany Debt is
paid in full in cash at par.
SECTION 8.2.3. Financial Condition. The Borrower will not
permit:
(a) its Stockholders' Equity to be at any time less
than negative $75,000,000; and
(b) its EBITDA, as of any date, for the four
consecutive Fiscal Quarters ending on the last day of the
Fiscal Quarter most recently ended on or prior to such date
to be less than $300,000,000.
SECTION 8.2.4. Any Action. The Borrower will not, and will
not permit any of its Subsidiaries to, take or omit to take any
action the taking or the omission of which would result in the
failure of any Obligor fully and properly to perform and observe
all of its obligations under any Loan Document to which it is a
party.
ARTICLE IX
EVENTS OF DEFAULT
SECTION 9.1. Listing of Events of Default. Each of the following
events or occurrences described in this Section 9.1 shall constitute an
"Event of Default".
SECTION 9.1.1. Non-Payment of Obligations. The Borrower shall (a)
default in the payment or prepayment when due of any principal of any Loan,
(b) default in the payment when due of any Reimbursement Obligation, (c)
default in the payment of any amount due pursuant to Section 4.7, (d)
default (and such default shall continue unremedied for a period of three
Business Days) in the payment when due of any interest on any Competitive
Bid Loan, (e) default (and such default shall continue unremedied for a
period of three Business Days) in the payment when due of any interest on
any Revolving Loan or (f) default (and such default shall continue
unremedied for a period of three Business Days) in the payment when due of
any fee or of any other Obligation payable hereunder or under any other
Loan Document.
SECTION 9.1.2. Breach of Warranty. Any representation or warranty
of the Borrower or any other Obligor made or deemed to be made hereunder or
in any other Loan Document executed by it or any other writing or
certificate furnished by or on behalf of the Borrower or any other Obligor
to the Agent, any Issuer or any Lender for the purposes of or in connection
with this Agreement or any such other Loan Document (including any
certificates delivered pursuant to Article VI or the Amendment Agreement)
is or shall be incorrect when made in any material respect.
SECTION 9.1.3. Non-Performance of Certain Covenants and
Obligations. (a) The Borrower shall default in the due performance and
observance of any of its obligations under Sections 8.2.2 and 8.2.3 or,
with respect to the Borrower, clause (a) of Section 8.1.2.
(b) ADT Limited shall default in the due performance and
observance of any of its obligations under Section 4.2 (other than
Sections 4.2.1 and 4.2.20) or Sections 4.1.6 or 4.1.7 or, with
respect to the Borrower and ADT Limited, clause (a) of Section
4.1.1 of the ADT Limited Guaranty.
(c) The Borrower shall default in the due performance and
observance of any of its obligations under Section 8.2.1 or Section
8.1.1 (other than clauses (c), (f) and (j) of Section 8.1.1), and
such default shall continue unremedied for a period of five
Business Days.
(d) ADT Limited shall default in the due performance and
observance of any of its obligations under Section 4.2.1 of the ADT
Limited Guaranty, and such default shall continue unremedied for a
period of five Business Days.
SECTION 9.1.4. Non-Performance of Other Covenants and Obligations.
The Borrower or any other Obligor shall default in the due performance and
observance of any other agreement contained herein or in any other Loan
Document executed by it, and such default shall continue unremedied for a
period of 30 days after notice thereof shall have been given to the
Borrower by the Agent or any Lender.
SECTION 9.1.5. Default on Other Indebtedness. A default shall occur
(a) in the payment when due (subject to any applicable grace period),
whether by acceleration or otherwise, of any Indebtedness (other than
Indebtedness described in Section 9.1.1) of the Borrower, ADT Limited or
any other Subsidiary of ADT Limited having a principal amount, individually
or in the aggregate, in excess of $15,000,000, or (b) in the performance or
observance of any obligation or condition with respect to such Indebtedness
if the effect of such default is to accelerate the maturity of any such
Indebtedness or such default shall continue unremedied for any applicable
period of time sufficient to permit the holder or holders of such
Indebtedness, or any trustee or agent for such holders, to cause such
Indebtedness to become due and payable prior to its expressed maturity.
SECTION 9.1.6. Judgments. Any judgment or order for the payment of
money in excess of $15,000,000 shall be rendered against the Borrower, ADT
Limited or any other Subsidiary of ADT Limited and either
(a) enforcement proceedings shall have been commenced by any
creditor upon such judgment or order; or
(b) there shall be any period of 30 consecutive days during
which a stay of enforcement of such judgment or order, by reason of
a pending appeal or otherwise, shall not be in effect.
SECTION 9.1.7. Pension Plans. Any of the following events shall
occur with respect to any Pension Plan
(a) the institution of any steps by the Borrower, any member of
its Controlled Group or any other Person to terminate a Pension Plan
if, as a result of such termination, the Borrower or any such member
could be required to make a contribution to such Pension Plan, or
could reasonably expect to incur a liability or obligation to such
Pension Plan, in excess of $15,000,000; or
(b) a contribution failure occurs with respect to any Pension
Plan sufficient to give rise to a Lien under Section 302(f) of
ERISA.
SECTION 9.1.8. Change in Control. Any Change in Control shall
occur.
SECTION 9.1.9. Bankruptcy, Insolvency, etc. The Borrower or any
other Material Related Party shall
(a) become insolvent or generally fail to pay, or admit in
writing its inability or unwillingness to pay, debts as they become
due;
(b) apply for, consent to, or acquiesce in, or permit any other
Subsidiary of the Borrower or ADT Limited to apply for, the
appointment of a trustee, administrator, receiver, sequestrator or
other custodian for the Borrower or any other Material Related Party
or any property of any thereof, or make a general assignment for the
benefit of creditors;
(c) in the absence of such application, consent or acquiescence,
permit or suffer to exist the appointment of a trustee,
administrator, receiver, sequestrator or other custodian for the
Borrower or any other Material Related Party or for a substantial
part of the property of any thereof, and such trustee, receiver,
sequestrator or other custodian shall not be discharged within 60
days, provided that the Borrower hereby expressly authorizes the
Agent and each Lender to appear in any court conducting any relevant
proceeding during such 60 day period to preserve, protect and defend
their rights under the Loan Documents;
(d) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement, administration,
receivership or other case or proceeding under any bankruptcy or
insolvency law, or any dissolution, winding up or liquidation
proceeding, in respect of the Borrower or any other Material Related
Party, and, if any such case or proceeding is not commenced by the
Borrower, ADT Limited or any other Subsidiary of ADT Limited, such
case or proceeding shall be consented to or acquiesced in by the
Borrower or such other Material Related Party or shall result in the
entry of an order for relief or shall remain for 60 days
undismissed, provided that the Borrower hereby expressly authorizes
the Agent and each Lender to appear in any court conducting any such
case or proceeding during such 60-day period to preserve, protect
and defend their rights under the Loan Documents; or
(e) take any corporate action authorizing, or in furtherance of,
any of the foregoing.
SECTION 9.1.10. Impairment of Loan Documents, etc. (a) Any Loan
Document shall (except in accordance with its terms), in whole or in part,
terminate, cease to be effective or cease to be the legally valid, binding
and enforceable obligation of any Obligor party thereto, except pursuant to
a transaction permitted under Section 4.2.9 of the ADT Limited Guaranty
(provided that, if, as a result of such transaction, any such Obligor shall
cease to exist, such obligation of such Obligor is expressly assumed by the
other Person party to such transaction) or a sale or transfer of the
Capital Stock of any such Obligor permitted under clause (c)(ii) of Section
4.2.10 of the ADT Limited Guaranty or pursuant to a Permitted Auction
Business Sale; or the Borrower, any such Obligor or any other party shall,
directly or indirectly, contest in any manner such effectiveness, validity,
binding nature or enforceability.
(b) The subordination provisions contained in, or relating to,
the Senior Subordinated Note Indenture, the XXXXx Indenture or the
Dividended Note shall (except in accordance with their respective
terms), in whole or in part, terminate, cease to be effective or
cease to be the legally valid, binding and enforceable obligation of
any holder of Senior Subordinated Notes, XXXXx or the Dividended
Note or of any party to the Senior Subordinated Note Indenture or
the XXXXx Indenture.
SECTION 9.2. Action if Bankruptcy. If any Event of Default
described in clause (b) or (d) of Section 9.1.9 shall occur with respect to
the Borrower or ADT Limited, the Revolving Loan Commitment (if not
theretofore terminated) shall automatically terminate, the outstanding
principal amount of all outstanding Loans and all other Obligations shall
automatically be and become immediately due and payable and the Borrower
shall immediately comply with its obligations under Section 4.7, in each
case without notice or demand.
SECTION 9.3. Action if Other Event of Default. If any Event of
Default (other than any Event of Default with respect to the Borrower or
ADT Limited described in clause (b) or (d) of Section 9.1.9) shall occur
for any reason, whether voluntary or involuntary, and be continuing, the
Agent, upon the direction of the Required Lenders, shall by notice to the
Borrower declare all or any portion of the outstanding principal amount of
the Loans and other Obligations to be due and payable, terminate the
Revolving Loan Commitment (if not theretofore terminated) and/or demand
immediate compliance of the Borrower with its obligations under Section
4.7, whereupon the full unpaid amount of such Loans and other Obligations
which shall be so declared due and payable shall be and become immediately
due and payable, without further notice, demand or presentment, the
Revolving Loan Commitment shall terminate and/or, as the case may be, the
Borrower shall be obligated to comply immediately with its obligations
under Section 4.7.
ARTICLE X
THE AGENT
SECTION 10.1. Actions. Each Lender hereby appoints Scotiabank as
its agent under and for purposes of this Agreement, the Notes and each
other Loan Document. Each Lender authorizes the Agent to act on behalf of
such Lender under this Agreement, the Notes and each other Loan Document
and, in the absence of other written instructions from the Required Lenders
received from time to time by the Agent (and the Agent hereby agrees that
it will comply, except as otherwise provided in this Section or as
otherwise advised by independent counsel of nationally recognized standing,
with such written instructions), to exercise such powers hereunder and
thereunder as are specifically delegated to or required of the Agent by the
terms hereof and thereof, together with such powers as may be reasonably
incidental thereto. Each Lender hereby indemnifies the Agent and each
Issuer (which indemnities shall survive any termination of this Agreement
and shall be pro rata according to such Lender's Percentage), from and
against any and all liabilities, obligations, losses, damages, claims,
costs or expenses of any kind or nature whatsoever which may at any time be
imposed on, incurred by, or asserted against, the Agent or any Issuer in
any way relating to or arising out of this Agreement, the Notes and any
other Loan Document, including reasonable attorneys' fees, and as to which
the Agent is not reimbursed by the Borrower; provided, however, that no
Lender shall be liable for the payment of any portion of such liabilities,
obligations, losses, damages, claims, costs or expenses which are
determined by a court of competent jurisdiction to have resulted from the
Agent's gross negligence or wilful misconduct. The Agent shall not be
required to take any action hereunder, under the Notes or under any other
Loan Document, or to prosecute or defend any suit in respect of this
Agreement, the Notes or any other Loan Document, unless it is indemnified
hereunder to its satisfaction. If any indemnity in favor of the Agent
shall be or become, in the Agent's determination, inadequate, the Agent may
call for additional indemnification from the Lenders and cease to do the
acts indemnified against hereunder until such additional indemnity is
given.
SECTION 10.2. Funding Reliance, etc. Unless the Agent shall have
been notified by telephone, confirmed in writing, by 5:00 p.m., New York
City time, on the day prior to a Borrowing by any Lender that is to
participate in such Borrowing that such Lender will not make available the
amount which would constitute its portion of such Borrowing on the date
specified therefor, the Agent may assume that such Lender has made such
amount available to the Agent and, in reliance upon such assumption, make
available to the Borrower a corresponding amount. If and to the extent
that such Lender shall not have made such amount available to the Agent,
such Lender and the Borrower severally agree to repay the Agent forthwith
on demand such corresponding amount together with interest thereon, for
each day from the date the Agent made such amount available to the Borrower
to the date such amount is repaid to the Agent, at, in the case of the
Borrower, the interest rate applicable at the time to Loans comprising such
Borrowing, and, in the case of such Lender, the Federal Funds Effective
Rate.
SECTION 10.3. Exculpation. None of the Agent, the Issuers or any
of their respective directors, officers, employees or agents shall be
liable to any Lender for any action taken or omitted to be taken by it
under this Agreement or any other Loan Document, or in connection herewith
or therewith, except for its own wilful misconduct or gross negligence, nor
responsible for any recitals or warranties herein or therein, nor for the
effectiveness, enforceability, validity or due execution of this Agreement
or any other Loan Document, or the validity, genuineness, enforceability,
existence, value or sufficiency of any collateral security, nor to make any
inquiry respecting the performance by the Borrower of its obligations
hereunder or under any other Loan Document. Any such inquiry which may be
made by the Agent or an Issuer shall not obligate the Agent or such Issuer,
as the case may be, to make any further inquiry or to take any action. The
Agent and each Issuer shall be entitled to rely upon advice of counsel
concerning legal matters and upon any notice, consent, certificate,
statement or writing which the Agent or such Issuer believes to be genuine
and to have been presented by a proper Person.
SECTION 10.4. Successor. The Agent may resign as such at any time
upon at least 30 days' prior notice to the Borrower and all Lenders. If
the Agent at any time shall resign, (i) the Required Lenders may appoint
another Lender as successor Agent which shall thereupon become the Agent
hereunder and (ii) if no successor Agent shall have been so appointed by
the Required Lenders, and shall have accepted such appointment, within 30
days after the retiring Agent's giving notice of resignation, then the
retiring Agent may, on behalf of the Lenders, appoint a successor Agent,
which shall be one of the Lenders or a commercial banking institution
organized under the laws of the U.S. (or any State thereof) or a U.S.
branch or agency of a commercial banking institution, and having a combined
capital and surplus of at least $500,000,000; provided that if any such
successor Agent is organized under the laws of any jurisdiction other than
the United States or any state thereof or is beneficially owned or
controlled by a person so organized, such successor Agent shall execute
such documents and instruments, if any, as may be required by the United
States Department of Defense. Upon the acceptance of any appointment as
the Agent hereunder by a successor Agent, such successor Agent shall be
entitled to receive from the retiring Agent such documents of transfer and
assignment as such successor Agent may reasonably request, and shall
thereupon succeed to and become vested with all rights, powers, privileges
and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations under this Agreement. After any
retiring Agent's resignation hereunder as the Agent, the provisions of
(a) this Article X shall inure to such retiring Agent's benefit
as to any actions taken or omitted to be taken by it while it was
the Agent under this Agreement; and
(b) Section 11.3 and Section 11.4 shall continue to inure to
such retiring Agent's benefit.
SECTION 10.5. Loans or Letters of Credit Issued by Scotiabank.
Scotiabank has the same rights and powers with respect to (x) the Loans
made by it or any of its Affiliates, (y) the Notes held by it or any of its
Affiliates, and (z) its participating interests in the Letters of Credit as
any other Lender and may exercise the same as if it were not the Agent.
Scotiabank and each of Scotiabank's Affiliates may accept deposits from,
lend money to, and generally engage in any kind of business with the
Borrower or any Subsidiary or Affiliate of the Borrower as if Scotiabank
were not the Agent hereunder.
SECTION 10.6. Credit Decisions. Each Lender acknowledges that it
has, independently of the Agent and each other Lender, and based on such
Lender's review of the financial information of the Borrower, this
Agreement, the other Loan Documents (the terms and provisions of which
being satisfactory to such Lender) and such other documents, information
and investigations as such Lender has deemed appropriate, made its own
credit decision to extend its Revolving Loan Commitment. Each Lender also
acknowledges that it will, independently of the Agent and each other
Lender, and based on such other documents, information and investigations
as it shall deem appropriate at any time, continue to make its own credit
decisions as to exercising or not exercising from time to time any rights
and privileges available to it under this Agreement or any other Loan
Document.
SECTION 10.7. Copies, etc. The Agent shall give prompt notice to
each Lender of each notice or request required or permitted to be given to
the Agent by the Borrower pursuant to the terms of this Agreement (unless
concurrently delivered to the Lenders by the Borrower). The Agent will
distribute to each Lender each document or instrument received for its
account and copies of all other communications received by the Agent from
the Borrower for distribution to the Lenders by the Agent in accordance
with the terms of this Agreement.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.1. Waivers, Amendments, etc. (a) The provisions of
this Agreement and of each other Loan Document may from time to time be
amended, modified or waived, if such amendment, modification or waiver is
in writing and consented to by the Borrower and the Required Lenders;
provided, however, that no such amendment, modification or waiver shall:
(i) modify any requirement hereunder that any particular action
be taken by all the Lenders or by the Required Lenders, modify
this Section 11.1(a) or change the definition of "Required
Lenders", or release ADT Limited from its guarantee of the
Obligations of the Borrower under Section 2.1 of the ADT Limited
Guaranty, unless consented to by each Lender;
(ii) increase any Revolving Loan Commitment Amount with respect
to such Lender or the Percentage of any Lender, reduce any fees
(or extend any payment date therefor) described in Article III
payable to any Lender or extend the Revolving Loan Commitment
Termination Date with respect to any Lender, without the consent
of such Lender;
(iii) extend the due date for, or reduce the amount of, any
scheduled repayment of principal of or interest on any Loan (or
reduce the principal amount of or rate of interest on any Loan),
without the consent of the holder of the Note evidencing such
Loan;
(iv) affect adversely the interests, rights or obligations of
any Issuer qua Issuer, without the consent of such Issuer; or
(v) affect adversely the interests, rights or obligations of
the Agent qua Agent, without the consent of the Agent.
(b) No failure or delay on the part of the Agent, any Lender or
the holder of any Note in exercising any power or right under this
Agreement or any other Loan Document shall operate as a waiver
thereof, nor shall any single or partial exercise of any such power
or right preclude any other or further exercise thereof or the
exercise of any other power or right. No notice to or demand on the
Borrower in any case shall entitle it to any notice or demand in
similar or other circumstances. No waiver or approval by the Agent,
any Lender or the holder of any Note under this Agreement or any
other Loan Document shall, except as may be otherwise stated in such
waiver or approval, be applicable to subsequent transactions. No
waiver or approval hereunder shall require any similar or dissimilar
waiver or approval thereafter to be granted hereunder.
SECTION 11.2. Notices. All notices and other communications
provided to any party hereto under this Agreement or any other Loan
Document shall be in writing or by facsimile and addressed, delivered or
transmitted to such party at its address or facsimile number set forth
below its signature hereto or set forth in the Lender Assignment Agreement
or at such other address or facsimile number as may be designated by such
party in a notice to the other parties. Any notice, if mailed and properly
addressed with postage prepaid, return receipt requested, or if properly
addressed and sent by pre-paid courier service, shall be deemed given when
received; any notice, if transmitted by facsimile, shall be deemed given
when transmitted upon receipt of electronic confirmation of transmission
(it being understood and agreed that notice transmitted by facsimile to ADT
Inc. shall constitute notice to the Borrower hereunder).
SECTION 11.3. Payment of Costs and Expenses. The Borrower agrees
to pay on demand all reasonable out-of-pocket expenses of the Agent
(including the fees and out-of-pocket expenses of counsel to the Agent (and
of local counsel, if any, who may be retained by such counsel)) in
connection with
(a) the negotiation, preparation, execution and delivery of this
Agreement and of each other Loan Document, including schedules and
exhibits, and any amendments, waivers, consents, supplements or
other modifications to this Agreement or any other Loan Document as
may from time to time hereafter be required, whether or not the
transactions contemplated hereby are consummated, and
(b) the preparation and review of the form of any document or
instrument relevant to this Agreement or any other Loan Document.
The Borrower further agrees to pay, and to save the Agent and the Lenders
harmless from all liability for, any stamp or other similar taxes which may
be payable in connection with the execution or delivery of this Agreement,
the borrowings hereunder, the issuance of the Notes, the issuance of the
Letters of Credit, or any other Loan Documents. The Borrower also agrees
to reimburse the Agent and each Lender upon demand for all reasonable out-
of-pocket expenses (including attorneys' fees and legal expenses) incurred
by the Agent or such Lender in connection with (x) the negotiation of any
restructuring or "work-out", whether or not consummated, of any Obligations
and (y) the enforcement of any Obligations.
SECTION 11.4. Indemnification. In consideration of the execution
and delivery of this Agreement by each Lender and the extension of the
Revolving Loan Commitments, the Borrower hereby indemnifies, exonerates and
holds the Agent, each Issuer and each Lender and each of their respective
officers, directors, employees and agents (collectively, the "Indemnified
Parties") free and harmless from and against any and all actions, causes of
action, suits, losses, costs, liabilities and damages, and expenses
incurred in connection therewith (irrespective of whether any such
Indemnified Party is a party to the action for which indemnification
hereunder is sought), including reasonable attorneys' fees and
disbursements (collectively, the "Indemnified Liabilities"), incurred by
the Indemnified Parties or any of them as a result of, or arising out of,
or relating to
(a) any transaction financed or to be financed in whole or in
part, directly or indirectly, with the proceeds of any Loan or the
use of any Letter of Credit;
(b) the entering into and performance of this Agreement and any
other Loan Document by any of the Indemnified Parties (including any
action brought by or on behalf of the Borrower as the result of any
determination by the Required Lenders pursuant to Article VI not to
make any Credit Extension);
(c) any investigation, litigation or proceeding related to any
environmental cleanup, audit, compliance or other matter relating to
the protection of the environment or the Release by the Borrower or
any of its Subsidiaries of any Hazardous Material; or
(d) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from, any
real property owned or operated by the Borrower or any Subsidiary
thereof of any Hazardous Material (including any losses,
liabilities, damages, injuries, costs, expenses or claims asserted
or arising under any Environmental Law), regardless of whether
caused by, or within the control of, the Borrower or such
Subsidiary,
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified Party's
gross negligence or wilful misconduct and provided that an Indemnified
Party will not effect any settlement in connection with any such
Indemnified Liabilities without the prior written consent of the Borrower,
which consent shall not be unreasonably withheld or delayed. If and to the
extent that the foregoing undertaking may be unenforceable for any reason,
the Borrower hereby agrees to make the maximum contribution to the payment
and satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law.
SECTION 11.5. Survival. The obligations of the Borrower under
Sections 4.9, 5.3, 5.4, 5.5, 5.6, 11.3 and 11.4, and the obligations of the
Lenders under Section 10.1, shall in each case survive any termination of
this Agreement, the payment in full of all Obligations and the termination
of all Revolving Loan Commitments. The representations and warranties made
by each Obligor in this Agreement and in each other Loan Document shall
survive the execution and delivery of this Agreement and each such other
Loan Document.
SECTION 11.6. Severability. Any provision of this Agreement or any
other Loan Document which is prohibited or unenforceable in any
jurisdiction shall, as to such provision and such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Agreement or such Loan
Document or affecting the validity or enforceability of such provision in
any other jurisdiction.
SECTION 11.7. Headings. The various headings of this Agreement and
of each other Loan Document are inserted for convenience only and shall not
affect the meaning or interpretation of this Agreement or such other Loan
Document or any provisions hereof or thereof.
SECTION 11.8. Execution in Counterparts, Effectiveness, etc. This
Agreement may be executed by the parties hereto in several counterparts,
each of which shall be deemed to be an original and all of which shall
constitute together but one and the same agreement. This Agreement shall
become effective pursuant to the terms and conditions of the Amendment
Agreement.
SECTION 11.9. Governing Law; Entire Agreement. THIS AGREEMENT,
THE NOTES AND EACH OTHER LOAN DOCUMENT SHALL EACH BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW
YORK. This Agreement, the Notes, the other Loan Documents and the
agreements referred to in Sections 3.3.3, 3.3.4, 3.3.5 and 11.11.1
constitute the entire understanding among the parties hereto with respect
to the subject matter hereof and supersede any prior agreements, written or
oral, with respect thereto.
SECTION 11.10. Successors and Assigns. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns; provided, however, that:
(a) the Borrower may not assign or transfer its rights or
obligations hereunder without the prior written consent of the Agent
and all Lenders; and
(b) the rights of sale, assignment and transfer of the Lenders
are subject to Section 11.11.
SECTION 11.11. Sale and Transfer of Loans and Notes;
Participations in Loans and Notes. Each Lender may assign, or sell
participations in, its Loans and Revolving Loan Commitment to one or more
other Persons in accordance with this Section 11.11.
SECTION 11.11.1. Assignments. Any Lender,
(a) with the written consents of the Borrower, the Agent and
each Issuer (which consents shall not be unreasonably delayed or
withheld) may at any time assign and delegate to one or more
commercial banks or other financial institutions, and
(b) with notice to the Borrower and the Agent, but without the
consent of the Borrower or the Agent, may assign and delegate to any
of its branches, agencies or Affiliates (provided a majority of the
Capital Stock of such Affiliate is held directly or indirectly by
such Lender or such Lender's holding company) or to any other Lender
(each Person described in either of the foregoing clauses as being the
Person to whom such assignment and delegation is to be made, being
hereinafter referred to as an "Assignee Lender"), (x) all or any fraction
of such Lender's Competitive Bid Loans and/or (y) all or any proportionate
fraction of such Lender's Revolving Loans, Letter of Credit Outstandings
and Revolving Loan Commitment, in each case, in a minimum aggregate amount
equal to the lesser of $5,000,000 and all of its (x) Competitive Bid Loans
or (y) Revolving Loans, Letter of Credit Outstandings and Revolving Loan
Commitment, as the case may be; provided, however, that any such Assignee
Lender will comply, if applicable, with the provisions contained in the
second sentence of the last paragraph of Section 5.6; provided further,
however, that, the Borrower, each other Obligor and the Agent shall be
entitled to continue to deal solely and directly with such Lender in
connection with the interests so assigned and delegated to an Assignee
Lender until
(i) written notice of such assignment and delegation, together
with payment instructions, addresses and related information with
respect to such Assignee Lender, shall have been given to the
Borrower and the Agent by such Lender and such Assignee Lender,
(ii) such Assignee Lender shall have executed and delivered to
the Borrower and the Agent a Lender Assignment Agreement, accepted
by the Agent, and
(iii) the processing fees described below shall have been paid.
From and after the date that the Agent accepts such Lender Assignment
Agreement, (x) the Assignee Lender thereunder shall be deemed automatically
to have become a party hereto and to the extent that rights and obligations
hereunder have been assigned and delegated to such Assignee Lender in
connection with such Lender Assignment Agreement, shall have the rights and
obligations of a Lender hereunder and under the other Loan Documents;
provided, that no Assignee Lender or other transferee of any Lender's
rights shall be entitled to receive any greater payment under Section 5.3,
5.5 or 5.6 than such Lender would have been entitled to receive with
respect to the rights transferred, unless such transfer is made with the
Borrower's prior written consent or at a time when the circumstances giving
rise to such greater payment did not exist, and (y) the assignor Lender, to
the extent that rights and obligations hereunder have been assigned and
delegated by it in connection with such Lender Assignment Agreement, shall
be released from its obligations hereunder and under the other Loan
Documents. Within five Business Days after its receipt of notice that the
Agent has received an executed Lender Assignment Agreement, the Borrower
shall execute and deliver to the Agent (for delivery to the relevant
Assignee Lender) new Notes evidencing such Assignee Lender's assigned Loans
and Revolving Loan Commitment and, if the assignor Lender has retained
Loans and any Revolving Loan Commitment hereunder, replacement Notes in the
principal amount of the Loans and such Revolving Loan Commitment retained
by the assignor Lender hereunder (such Notes to be in exchange for, but not
in payment of, those Notes then held by such assignor Lender). Each such
Note shall be dated the date of the predecessor Notes. The assignor Lender
shall xxxx the predecessor Notes "exchanged" and deliver them to the
Borrower. Accrued interest on that part of the predecessor Notes evidenced
by the new Notes, and accrued fees, shall be paid as provided in the Lender
Assignment Agreement. Accrued interest on that part of the predecessor
Notes evidenced by the replacement Notes shall be paid to the assignor
Lender. Accrued interest and accrued fees shall be paid at the same time
or times provided in the predecessor Notes and in this Agreement. Such
assignor Lender or such Assignee Lender must also pay a processing fee to
the Agent upon delivery of any Lender Assignment Agreement in the amount of
$3,000. Any attempted assignment and delegation not made in accordance
with this Section 11.11.1 shall be null and void. Notwithstanding any
provision contained in this Section 11.11.1 to the contrary, nothing shall
prevent or prohibit any Lender from pledging its rights under this
Agreement and/or its Loans and/or Notes hereunder to a Federal Reserve Bank
in support of borrowings made by such Lender from such Federal Reserve
Bank; provided that no such pledge by any Lender shall relieve such Lender
of any of its obligations hereunder.
SECTION 11.11.2. Participations. Any Lender may at any time sell
to one or more commercial banks or other Persons (each of such commercial
banks and other Persons being herein called a "Participant") participating
interests (or a sub-participating interest, in the case of a Lender's
participating interest in a Letter of Credit) in any of the Loans,
Revolving Loan Commitment, or other interests of such Lender hereunder;
provided, however, that
(a) no participation or sub-participation contemplated in this
Section 11.11 shall relieve such Lender from its Revolving Loan
Commitment or its other obligations hereunder or under any other
Loan Document,
(b) such Lender shall remain solely responsible for the
performance of its Revolving Loan Commitment and such other
obligations,
(c) the Borrower and each other Obligor and the Agent shall
continue to deal solely and directly with such Lender in connection
with such Lender's rights and obligations under this Agreement and
each of the other Loan Documents,
(d) no Participant, unless such Participant is an Affiliate of
such Lender, or is itself a Lender, shall be entitled to require
such Lender to take or refrain from taking any action hereunder or
under any other Loan Document, except that such Lender may agree
with any Participant that such Lender will not, without such
Participant's consent, take any actions of the type described in
clause (ii) or (iii) of Section 11.1(a), and
(e) the Borrower shall not be required to pay any amount under
Section 5.6 that is greater than the amount which it would have been
required to pay had no participating interest been sold.
The Borrower acknowledges and agrees that, to the extent permitted under
applicable law, each Participant, for purposes of Sections 5.3, 5.4, 5.5,
5.6, 5.8, 11.3 and 11.4, shall be considered a Lender; provided, that no
Participant shall be entitled to receive any greater payment under Section
5.3, 5.5 or 5.6 than the Lender that transferred such rights to such
Participant would have been entitled to receive with respect to such
rights, unless such transfer is made with the Borrower's prior written
consent or at a time when the circumstances giving rise to such greater
payment did not exist.
SECTION 11.12. Other Transactions. Nothing contained herein shall
preclude the Agent or any other Lender or Issuer from engaging in any
transaction, in addition to those contemplated by this Agreement or any
other Loan Document, with the Borrower or any of its Affiliates in which
the Borrower or such Affiliate is not restricted hereby from engaging with
any other Person.
SECTION 11.13. Independence of Covenants. All covenants contained
in this Agreement or any other Loan Document shall be given independent
effect such that, in the event 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 limitations of, another
covenant shall not, unless expressly so provided in such first covenant,
avoid the occurrence of a Default or an Event of Default if such action is
taken or such condition exists.
SECTION 11.14. Forum Selection and Consent to Jurisdiction. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH,
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE AGENT,
THE LENDERS OR THE BORROWER SHALL BE BROUGHT AND MAINTAINED TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW EXCLUSIVELY IN THE COURTS OF THE STATE
OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT
AGAINST ANY PROPERTY MAY BE BROUGHT, AT THE AGENT'S OPTION, IN THE COURTS
OF ANY JURISDICTION WHERE SUCH PROPERTY MAY BE FOUND. THE BORROWER HEREBY
EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH
ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY
IN CONNECTION WITH SUCH LITIGATION. THE BORROWER HEREBY IRREVOCABLY
APPOINTS XXX, XXXXXXX & XXXXX (THE "PROCESS AGENT"), WITH AN OFFICE ON THE
DATE HEREOF AT 0 XXX XXXXXXXXXXXX XXXXX, XXX XXXX, XXX XXXX, XXXXXX XXXXXX
(ATTENTION: XXX XXXXXXXXXXX), AS ITS AGENT TO RECEIVE, ON THE BORROWER'S
BEHALF AND ON BEHALF OF ITS PROPERTY, SERVICE OF COPIES OF THE SUMMONS AND
COMPLAINT AND ANY OTHER PROCESS WHICH MAY BE SERVED IN ANY SUCH ACTION OR
PROCEEDING. SUCH SERVICE MAY BE MADE BY MAILING OR DELIVERING A COPY OF
SUCH PROCESS TO THE BORROWER IN CARE OF THE PROCESS AGENT AT THE PROCESS
AGENT'S ABOVE ADDRESS, AND THE BORROWER HEREBY IRREVOCABLY AUTHORIZES AND
DIRECTS THE PROCESS AGENT TO ACCEPT SUCH SERVICE ON ITS BEHALF. AS AN
ALTERNATIVE METHOD OF SERVICE, THE BORROWER ALSO IRREVOCABLY CONSENTS TO
THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL
SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK. THE BORROWER HEREBY
AGREES THAT IN THE EVENT THE PROCESS AGENT IS NO LONGER RESIDENT IN NEW
YORK, NEW YORK, IT SHALL APPOINT A SUCCESSOR PROCESS AGENT RESIDENT IN NEW
YORK, NEW YORK, REASONABLY ACCEPTABLE TO THE AGENT, WHICH SUCCESSOR PROCESS
AGENT SHALL THEREAFTER BE THE PROCESS AGENT HEREUNDER. THE BORROWER HEREBY
EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF
VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE
AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM. TO THE EXTENT THAT THE BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY
IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID
OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, THE
BORROWER HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW
SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS.
SECTION 11.15. Waiver of Jury Trial. THE AGENT, THE LENDERS AND
THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY
RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE AGENT, THE LENDERS
OR THE BORROWER. THE BORROWER ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED
FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER
PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT
THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENT AND THE LENDERS
ENTERING INTO THIS AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
ADT OPERATIONS, INC.
/s/ Xxx X. Xxxx
By: _________________________________
Title: Vice President
Address: 000 Xxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
With a copy to:
ADT Inc.
0000 Xxxxx Xxxxx Xxxx
Xxxx Xxxxx, Xxxxxxx 00000
Facsimile No.: 000-000-0000
Attention: President
AGENT
THE BANK OF NOVA SCOTIA, as Agent
/s/ X.X. Xxxxx
By: _________________________________
Title: Vice President
Address: 000 Xxxxxxxxx Xxxxxx X.X.
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Facsimile No.: 000-000-0000
Attention: Xxxxx Xxxxxxx
LETTER OF CREDIT ISSUER
THE BANK OF NOVA SCOTIA
/s/ X.X. Xxxxx
By: _________________________________
Title: Vice President
Address: 000 Xxxxxxxxx Xxxxxx X.X
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Facsimile No.: 000-000-0000
Attention: Xxxxx Xxxxxx
PERCENTAGE LENDERS
20.000000000% THE BANK OF NOVA SCOTIA
/s/ X.X. Xxxxx
By: _________________________________
Title: Vice President
Domestic, LIBOR
and Notice
Office: 000 Xxxxxxxxx Xxxxxx X.X.
Xxxxx 0000
Xxxxxxx, XX 00000
Facsimile No.: 000-000-0000
Attention: Xxxxx Xxxxxxx
Xxxxx Xxxxxx
8.000000000% BANK OF MONTREAL
/s/ Xxxx Xxxx
By: _________________________________
Title: Director
Domestic and
LIBOR
Office: 000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Facsimile No.: 000-000-0000
Attention: Xxxxx Xxxxx
Notice
Office: 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile No.: 000-000-0000
Attention: Xxxx Xxxx
8.000000000% CIBC INC.
/s/ Xxxxxxx X. Xxxxxxxxx
By: _________________________________
Title: Director, CIBC Wood Gundy
Securities Corp. AS AGENT
Domestic,
LIBOR
and Notice
Office: Two Paces West
0000 Xxxxx Xxxxx Xxxx, X.X.
Xxxxx 0000
Xxxxxxx, XX 00000
Facsimile No.: 000-000-0000
Attention: Xxxxx Xxxxx
8.000000000% CREDIT LYONNAIS ATLANTA AGENCY
/s/ Xxxxx X. Xxxxxx
By: _________________________________
Title: First Vice President
Domestic and
LIBOR
Office: 000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 0000
Xxxxxxx, XX 00000
Facsimile No.: 000-000-0000
Attention: Pascal Seris
Notice
Office: 000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 0000
Xxxxxxx, XX 00000
Facsimile No.: 000-000-0000
Attention: Pascal Seris
8.000000000% CREDIT SUISSE FIRST BOSTON
/s/ Xxxxxx X. Xxxxxxxxxx
By: _________________________________
Title: Associate
/s/ Xxxxxx X. Xxxxx
By: _________________________________
Title: Associate
Domestic and
LIBOR
Office: Credit Suisse First Boston
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Facsimile No.: 000-000-0000
Attention: Xxxxx Xxxxxx
Notice
Office: Credit Suisse First Boston
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Facsimile No.: 000-000-0000
Attention: Xxxxxx Xxxxxx
8.000000000% FIRST UNION NATIONAL BANK OF FLORIDA
/s/ X. Xxxxxx Xxxxxx
By: _________________________________
Title: Vice President
Domestic,
LIBOR
and Notice
Office: Corporate Banking
000 Xxxx Xxxxxxx Xxxxxxxxx
Xxxxx 000
Xx. Xxxxxxxxxx, XX 00000
Facsimile No.: 000-000-0000
Attention: X. Xxxxxx Xxxxxx
8.000000000% THE FUJI BANK, LIMITED, NEW YORK BRANCH
/s/ Xxxxxxxx Xxxxxx
By: _________________________________
Title: Senior Vice President
Domestic, LIBOR
and Notice
Office: 0 Xxxxx Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile No.: 212-912-0516
Attention: Xxxxxxxx Xxxxxxxx
8.000000000% MELLON BANK N.A.
/s/ Xxxxxxxx X. Xxxx
By: _________________________________
Title: Assistant Vice President
Domestic,
LIBOR
and Notice
Office: Xxx Xxxxxx Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Facsimile No.: 000-000-0000
Attention: Xxxxxxxx X. Xxxx
8.000000000% MIDLAND BANK PLC, NEW YORK BRANCH
/s/ Xxxx X. Xxxxx
By: _________________________________
Title: Authorized Signatory
Domestic,
LIBOR
and Notice
Office: 000 Xxxxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000-0000
Facsimile No.: 000-000-0000
Attention: Xxxxxxxx Xxxxxx
8.000000000% THE MITSUBISHI TRUST AND BANKING
CORPORATION
/s/ Xxxxxxx Xxxxxx
By: _________________________________
Title: Senior Vice President
Domestic,
LIBOR
and Notice
Office: 000 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: 000-000-0000
Attention: Xxxxxxx Xxxx
8.000000000% NATIONSBANK, N.A. (SOUTH)
/s/ Xxxxx X. Xxxxxxxx
By: _________________________________
Title: Senior Vice President
Domestic
and LIBOR
Office: 000 Xxxxx Xxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxx, XX 00000
Facsimile No.: 000-000-0000
Attention: Xxxxxxx Xxxxxx
Notice
Office: 000 Xxxxxxxxx Xxxxxx, X.X.
00xx Xxxxx
Xxxxxxx, XX 00000
Facsimile No.: 000-000-0000
Attention: Multinational Corporate
Xxxxx X. Xxxxxxxx
____
100%
TABLE OF CONTENTS
SECTION PAGE
------- ----
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms..............................................1
1.2. Use of Defined Terms......................................35
1.3. Cross-References; Interpretative Matters..................35
1.4. Accounting and Financial Determinations...................35
ARTICLE II
COMMITMENTS, COMPETITIVE BID LOANS,
BORROWING PROCEDURES AND NOTES
2.1. Commitments...............................................35
2.1.1. Revolving Loan Commitment.................................36
2.1.2. Commitment to Issue Letters of Credit.....................36
2.1.3. Lenders Not Permitted or Required To Make Loans Under
Certain Circumstances..................................36
2.1.4. Reduction of the Revolving Loan Commitment Amount.........36
2.1.4.1. Voluntary Reduction.......................................36
2.1.4.2. Mandatory Reduction.......................................36
2.2. Borrowing Procedure for Revolving Loans...................37
2.3. Competitive Bid Loans.....................................38
2.3.1. Competitive Bid Loan Borrowing Request....................38
2.3.2. Invitation for Bid Loan Offers............................39
2.3.3. Submission and Contents of Bid Loan Offers................39
2.3.4. Notice to Borrower........................................40
2.3.5. Competitive Bid Loan Acceptance...........................40
2.3.6. Funding of Competitive Bid Loans..........................42
2.4. Continuation and Conversion Elections.....................42
2.5. Funding...................................................43
2.6. Notes.....................................................43
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
3.1. Repayments and Prepayments................................44
3.1.1. Voluntary Prepayments.....................................44
3.1.1.1. Revolving Loans...........................................44
3.1.1.2. Competitive Bid Loans.....................................45
3.1.2. Mandatory Prepayments.....................................45
3.1.2.1. Mandatory Prepayment Upon Commitment Reduction............45
3.1.2.2. Acceleration of Scheduled Maturity........................45
3.2. Interest Provisions.......................................46
3.2.1. Rates.....................................................46
3.2.2. Post-Maturity Rates.......................................47
3.2.3. Payment Dates.............................................47
3.2.4. Interest Rate Determination...............................48
3.3. Fees......................................................49
3.3.1. Facility Fee..............................................49
3.3.2. Letter of Credit Face Amount Fee..........................49
3.3.3. Letter of Credit Issuer Fronting Fee......................50
3.3.4. Letter of Credit Administrative Expenses..................50
3.3.5. Other Fees................................................50
ARTICLE IV
LETTERS OF CREDIT
4.1. Issuances and Extensions..................................50
4.2. Issuance Requests.........................................51
4.3. Expenses..................................................52
4.4. Participation By Lenders..................................52
4.5. Disbursements.............................................53
4.6. Repayment/Reimbursement...................................54
4.7. Deemed Disbursements and Cash Collateralization of
Letters of Credit......................................54
4.8. Nature of Repayment/Reimbursement Obligations.............55
4.9. Increased Costs; Indemnity................................56
ARTICLE V
CERTAIN LIBO RATE AND OTHER PROVISIONS
5.1. LIBO Rate Lending Unlawful................................57
5.2. Deposits Unavailable......................................58
5.3. Increased LIBO Rate Loan Costs, etc.......................58
5.4. Funding Losses............................................59
5.5. Increased Capital Costs...................................60
5.6. Taxes.....................................................60
5.7. Payments, Computations, etc...............................62
5.8. Sharing of Payments.......................................63
5.9. Setoff....................................................63
5.10. Use of Proceeds...........................................64
5.11. Use of Letters of Credit..................................64
5.12. Substitution of LIBOR Office or Domestic Office in Certain
Circumstances..........................................64
5.13. Substitution of Bank; Election to Terminate...............64
ARTICLE VI
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
6.1. [INTENTIONALLY OMITTED]...................................65
6.2. All Credit Extensions.....................................65
6.2.1. Compliance with Warranties, No Default, etc...............65
6.2.2. Credit Extension Request..................................66
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
7.1. Organization, etc.........................................67
7.2. Due Authorization, Non-Contravention, etc.................67
7.3. Government Approval, Regulation, etc......................68
7.4. Validity, etc.............................................68
7.5. No Material Adverse Change................................68
7.6. Litigation, Labor Controversies, etc......................68
7.7. Subsidiaries..............................................69
7.8. Seniority of the Obligations..............................69
7.9. Existing Letters of Credit................................69
ARTICLE VIII
COVENANTS
8.1. Affirmative Covenants.....................................69
8.1.1. Financial Information, Reports, Notices, etc..............69
8.1.2. Compliance with Laws, etc.................................72
8.2. Negative Covenants........................................72
8.2.1. Business Activities.......................................72
8.2.2. Indebtedness..............................................73
8.2.3. Financial Condition.......................................76
8.2.4. Any Action................................................76
ARTICLE IX
EVENTS OF DEFAULT
9.1. Listing of Events of Default..............................76
9.1.1. Non-Payment of Obligations................................76
9.1.2. Breach of Warranty........................................76
9.1.3. Non-Performance of Certain Covenants and Obligations......77
9.1.4. Non-Performance of Other Covenants and Obligations........77
9.1.5. Default on Other Indebtedness.............................77
9.1.6. Judgments.................................................78
9.1.7. Pension Plans.............................................78
9.1.8. Change in Control.........................................78
9.1.9. Bankruptcy, Insolvency, etc...............................78
9.1.10. Impairment of Loan Documents, etc.........................79
9.2. Action if Bankruptcy......................................80
9.3. Action if Other Event of Default..........................80
ARTICLE X
THE AGENT
10.1. Actions...................................................80
10.2. Funding Reliance, etc.....................................81
10.3. Exculpation...............................................81
10.4. Successor.................................................82
10.5. Loans or Letters of Credit Issued by Scotiabank...........82
10.6. Credit Decisions..........................................83
10.7. Copies, etc...............................................83
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1. Waivers, Amendments, etc..................................83
11.2. Notices...................................................84
11.3. Payment of Costs and Expenses.............................84
11.4. Indemnification...........................................85
11.5. Survival..................................................86
11.6. Severability..............................................86
11.7. Headings..................................................86
11.8. Execution in Counterparts, Effectiveness, etc.............87
11.9. Governing Law; Entire Agreement...........................87
11.10. Successors and Assigns....................................87
11.11. Sale and Transfer of Loans and Notes; Participations in
Loans and Notes........................................87
11.11.1. Assignments...............................................87
11.11.2. Participations............................................89
11.12. Other Transactions........................................90
11.13. Independence of Covenants.................................90
11.14. Forum Selection and Consent to Jurisdiction...............91
11.15. Waiver of Jury Trial......................................91
SCHEDULE I - Disclosure Schedule
SCHEDULE II - Intercompany Subordination Provisions
EXHIBIT A - Form of Revolving Loan Note
EXHIBIT B - Form of Competitive Bid Loan Note
EXHIBIT C-1 - Form of Revolving Loan Borrowing Request
EXHIBIT C-2 - Form of Competitive Bid Loan Borrowing Request
EXHIBIT D-1 - Form of Invitation for Bid Loan Offers
EXHIBIT D-2 - Form of Competitive Bid Loan Offer
EXHIBIT D-3 - Form of Competitive Bid Loan Acceptance
EXHIBIT E - Intentionally Omitted
EXHIBIT F - Form of Continuation/Conversion Notice
EXHIBIT G - Form of Lender Assignment Agreement
EXHIBIT H - Form of Compliance Certificate
EXHIBIT I - Conformed Copy of ADT Limited Guaranty
EXHIBIT J - Conformed Copy of Subsidiary Guarantor Guaranty
EXHIBIT A
REVOLVING NOTE
New York, New York
$__________________________ January 14, 1997
FOR VALUE RECEIVED, the undersigned, ADT OPERATIONS, INC., a Delaware
corporation (the "Borrower"), promises to pay to the order of
____________________ (the "Lender") on _________, 19__ the principal sum of
_________________ DOLLARS ($ ________) or, if less, the aggregate unpaid
principal amount of all Revolving Loans shown on the schedule attached hereto
(and any continuation thereof) made by the Lender pursuant to that certain
Credit Agreement, dated as of January __, 1997 (together with all amendments
and other modifications, if any, from time to time thereafter made thereto,
the "Credit Agreement"), among the Borrower, the financial institutions as are
or may become parties thereto (collectively, the "Lenders"), and The Bank of
Nova Scotia ("Scotiabank"), individually and as agent (the "Agent") for the
Lenders.
The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement.
Payments of both principal and interest are to be made in lawful money of
the United States of America in same day or immediately available funds to the
account designated by the Agent pursuant to the Credit Agreement.
This Note is one of the Revolving Notes referred to in, and evidences
Indebtedness incurred under, the Credit Agreement, to which reference is made
for a statement of the terms and conditions on which the Borrower is permitted
and required to make prepayments and repayments of principal of the
Indebtedness evidenced by this Note and on which such Indebtedness may be
declared to be immediately due and payable. Unless otherwise defined, terms
used herein have the meanings provided in the Credit Agreement.
All parties hereto, whether as makers, endorsers, or otherwise, severally
waive presentment for payment, demand, protest and notice of dishonor.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
THIS NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND SHALL BE DEEMED TO
BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW
YORK.
ADT OPERATIONS, INC.
By: _______________________________
Title:
REVOLVING LOANS AND PRINCIPAL PAYMENTS
Amount of Revolving Amount of Principal Unpaid Principal
Loan Made Interest Repaid Balance
--------------------- (Period ----------------------- ---------------------
Alternate (If Ap- Alternate Alternate
Base LIBO plic- Base LIBO Base LIBO Notation
Date Rate Rate able) Rate Rate Rate Rate Total Made By
---- --------- ---- -------- --------- ---- --------- ---- ----- --------
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EXHIBIT B
COMPETITIVE BID LOAN NOTE
$250,000,000 New York, New York
January 14, 1997
FOR VALUE RECEIVED, the undersigned, ADT OPERATIONS, INC., a Delaware
corporation (the "Borrower"), hereby unconditionally promises to pay to the
order of (the "Lender") at the office of The Bank of Nova
Scotia located at Xxx Xxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, in lawful money
of the United States of America and in immediately available funds, the
aggregate unpaid principal amount of each Competitive Bid Loan which is made
by the Lender to the Borrower pursuant to Section 2.3 of the Credit Agreement,
as hereinafter defined. The principal amount of each Competitive Bid Loan
evidenced hereby shall be payable on the Competitive Bid Loan Maturity Date
therefor. The Borrower further agrees to pay interest in like money at such
office on the unpaid principal amount of each Competitive Bid Loan evidenced
hereby, at the Competitive Bid Rate with respect thereto from the borrowing
date of such Competitive Bid Loan until the due date thereof (whether at the
stated maturity, by acceleration or otherwise) and thereafter at the rates
determined in accordance with Section 3.2.2 of the Credit Agreement. Interest
on each Competitive Bid Loan evidenced hereby shall be payable on any
applicable Competitive Bid Loan Interest Payment Dates and on the Competitive
Bid Loan Maturity Date. Except as otherwise provided in Section 3.1.1.2 of
the Credit Agreement, Competitive Bid Loans evidenced by this Note may not be
prepaid without the written consent of the Lender.
The holder of this Note is authorized to endorse on the schedule
attached hereto and made a part hereof or on a continuation of such schedule
which shall be attached hereto and made a part hereof (the "Grid") the date of
the Competitive Bid Loan Borrowing, amount, Competitive Bid Rate, Competitive
Bid Loan Interest Payment Dates and Competitive Bid Loan Maturity Date in
respect of each Competitive Bid Loan made by such holder pursuant to Section
2.3 of the Credit Agreement and each payment of principal with respect
thereto. Each such endorsement shall constitute prima facie evidence of the
accuracy of the information endorsed. The failure to make any such
endorsement shall not affect the obligations of the Borrower in respect of
such Competitive Bid Loan.
This Note is one of the Competitive Bid Loan Notes referred to in the
Credit Agreement dated as of January __, 1997 (as amended, supplemented or
otherwise modified from time to time, the "Credit Agreement"), among the
Borrower, the Lender, the various other financial institutions as are or may
become parties thereto (together with the Lender, the "Lenders"), and The Bank
of Nova Scotia ("Scotiabank"), individually and as agent (the "Agent") for the
Lenders, to which reference is made for a statement of the terms and
conditions on which the Borrower is permitted or required to make prepayments
and repayments of principal of the Indebtedness evidenced by this Note and on
which such Indebtedness may be declared to be immediately due and payable.
All parties now and hereafter liable with respect to this Note, whether
maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind.
Unless otherwise defined herein, terms defined in the Credit Agreement
and used herein shall have the meanings given to them in the Credit Agreement.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF NEW YORK.
ADT OPERATIONS, INC.
By: _________________________________
Title:
SCHEDULE OF COMPETITIVE BID LOANS
, Lender
ADT OPERATIONS, INC., Borrower
Credit Agreement dated January __, 1997
Date of Amount of Competitive Bid Competitive Bid Competitive Bid
Competitive Bid Competitive Bid Competitive Loan Interest Loan Maturity Loan Payment
Loan Borrowing Loan Bid Rate Payment Dates Date Date Authorization
---------------------------------------------------------------------------------------------------------------------------
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EXHIBIT C-1
REVOLVING LOAN BORROWING REQUEST
The Bank of Nova Scotia,
as Agent
000 Xxxxxxxxx Xxxxxx X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: ______________
ADT Operations, Inc.
Gentlemen and Ladies:
This Borrowing Request is delivered to you pursuant to Section 2.2 of the
Credit Agreement, dated as of January __, 1997 (together with all amendments
and other modifications, if any, from time to time made thereto, the "Credit
Agreement"), among ADT Operations, Inc., a Delaware corporation (the
"Borrower"), the financial institutions as are or may become parties thereto
(collectively, the "Lenders"), and The Bank of Nova Scotia ("Scotiabank"),
individually and as agent (the "Agent") for the Lenders. Unless otherwise
defined herein or the context otherwise requires, terms used herein have the
meanings provided in the Credit Agreement.
The Borrower hereby requests that a Revolving Loan be made in the
aggregate principal amount of $__________ on ________ __, 199_ as a [LIBO Rate
Loan having an Interest Period of [one] [two] [three] [six] [nine] [twelve]
months] [Base Rate Loan].
The Borrower hereby acknowledges that, pursuant to Section 6.2.2 of the
Credit Agreement, each of the delivery of this Borrowing Request and the
acceptance by the Borrower of the proceeds of the Borrowing requested hereby
constitute a representation and warranty by the Borrower that, on the date of
such Borrowing, and before and after giving effect thereto and to the
application of the proceeds therefrom, all statements set forth in clauses
(a), (b) and (c) of Section 6.2.1 are true and correct in all material
respects.
The Borrower agrees that if prior to the time of the Borrowing requested
hereby any matter certified to herein by it will not be true and correct at
such time as if then made, it will immediately so notify the Agent. Except to
the extent, if any, that prior to the time of the Borrowing requested hereby
the Agent shall receive written notice to the contrary from the Borrower, each
matter certified to herein shall be deemed once again to be certified as true
and correct at the date of such Borrowing as if then made.
Please wire transfer the proceeds of the Borrowing to the accounts of the
following persons at the financial institutions indicated respectively:
Amount to be Person to be Paid Name, Address, etc.
Transferred Name Account No. of Transferee Lender
----------- ---- ----------- ____________________
$___________ __________ ___________ ____________________
____________________
Attention: _________
$___________ __________ ___________ ____________________
____________________
Attention: _________
Balance of The Borrower __________ ____________________
such proceeds ____________________
Attention: _________
_________
The Borrower has caused this Borrowing Request to be executed and
delivered, and the certification and warranties contained herein to be made,
by its duly Authorized Officer this day of , 19 .
ADT OPERATIONS, INC.
By: ___________________________________
Title:
EXHIBIT C-2
COMPETITIVE BID LOAN BORROWING REQUEST
______________, 199_
The Bank of Nova Scotia,
as Agent
000 Xxxxxxxxx Xxxxxx X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: _________
ADT Operations, Inc.
Reference is made to the Credit Agreement, dated as of January __, 1997
(as amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among ADT Operations, Inc., a Delaware corporation (the
"Borrower"), the various financial institutions as are or may become parties
thereto (the "Lenders"), and The Bank of Nova Scotia ("Scotiabank"),
individually and as agent (the "Agent") for the Lenders. Terms defined in the
Credit Agreement and used herein shall have the meanings given to them in the
Credit Agreement.
This is a Competitive Bid Loan Borrowing Request(*) pursuant
to Section 2.3.1 of the Credit Agreement requesting Competitive
Bid Loan Offers for the following Competitive Bid Loans:
Loan 1 Loan 2** Loan 3**
Aggregate Principal ------ -------- --------
Amount $ $ $
------------- ------------- -------------
Date of Competitive
Bid Loan Borrowing
Competitive Bid Loan
Maturity Date
(*) A Competitive Bid Loan Borrowing Request may be transmitted in
writing, by telecopy, or by telephone, immediately confirmed by
telecopy. In any case, a Competitive Bid Loan Borrowing Request
shall contain the information specified in the second paragraph of
this form.
(**) Include if applicable.
The Borrower hereby acknowledges that, pursuant to Section 6.2.2 of the
Credit Agreement, each of the delivery of this Borrowing Request and the
acceptance by the Borrower of the proceeds of the Borrowing requested hereby
constitute a representation and warranty by the Borrower that, on the date of
such Borrowing, and before and after giving effect thereto and to the
application of the proceeds therefrom, all statements set forth in clauses
(a), (b) and (c) of Section 6.2.1 are true and correct in all material
respects.
The Borrower agrees that if prior to the time of the Borrowing requested
hereby any matter certified to herein by it will not be true and correct at
such time as if then made, it will immediately so notify the Agent. Except to
the extent, if any, that prior to the time of the Borrowing requested hereby
the Agent shall receive written notice to the contrary from the Borrower, each
matter certified to herein shall be deemed once again to be certified as true
and correct at the date of such Borrowing as if then made.
Very truly yours,
ADT OPERATIONS, INC.
By: _______________________________
Name:
Title:
EXHIBIT D-1
INVITATION FOR BID LOAN OFFERS
[NAME OF LENDER]
_______________________
_______________________
Attention: ___________
Invitation for Bid Loan Offers to ADT Operations, Inc.
Pursuant to Section 2.3.2 of the Credit Agreement, dated as of January
__, 1997 (as amended, supplemented or otherwise modified from time to time,
the "Credit Agreement"), among ADT Operations, Inc., a Delaware corporation
(the "Borrower"), the various financial institutions as are or may become
parties thereto (the "Lenders"), and The Bank of Nova Scotia ("Scotiabank"),
individually and as agent (the "Agent") for the Lenders (capitalized terms
used herein are used as defined in the Credit Agreement), we are pleased on
behalf of the Borrower to invite you to submit Competitive Bid Loan Offers to
the Borrower for the following proposed Competitive Bid Loan(s):
*)1. Date of Proposed Competitive Bid Loan Borrowing:
__________ __, 19__.
2. Principal Amount
$
3. The Competitive Bid Loan Maturity Date will be __________ __, 199_.
4. The Competitive Bid Loan Interest Payment Date(s) will be ________
__, 199_.
Such Competitive Bid Loan Offers should offer a LIBO Rate Bid Margin.
PLEASE RESPOND TO THIS INVITATION BY NO LATER THAN 10:00 am (NEW YORK
CITY TIME) ON ____________ __, 199_.
THE BANK OF NOVA SCOTIA, as
Agent
By: ___________________________
Title
_______________
(*) Information to be repeated if multiple Competitive Bid Loans have
been requested in a single Competitive Bid Loan Borrowing Request.
EXHIBIT D-2
COMPETITIVE BID LOAN OFFER
________________, 199_
The Bank of Nova Scotia,
as Agent
000 Xxxxxxxxx Xxxxxx X.X.
Xxxxxxx, Xxxxxxx 00000
Attention:_________________
ADT Operations, Inc.
Reference is made to the Credit Agreement, dated as of January __, 1997
(as amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among ADT Operations, Inc., a Delaware corporation (the
"Borrower"), the various financial institutions as are or may become parties
thereto (the "Lenders"), and The Bank of Nova Scotia ("Scotiabank"),
individually and as agent (the "Agent") for the Lenders. Terms defined in the
Credit Agreement and used herein shall have the meanings given to them in the
Credit Agreement.
In accordance with Section 2.3.3 of the Credit Agreement, the
undersigned Lender offers to make Competitive Bid Loans thereunder in the
following amounts with the following maturity dates:
Date of Competitive Aggregate Maximum Amount: $________________
Bid Loan Borrowing:
_____________________ , 199
-------------------------------------------------------------------------------------------------------------
Competitive Bid Loan Maturity Date 1: Maximum Amount: $__________________________
$________________offered at _______________*
-----------------------, 199__ $________________offered at _______________*
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
Competitive Bid Loan Maturity Date 2**: Maximum Amount: $__________________________
$________________offered at _______________*
-----------------------, 199__ $________________offered at _______________*
-------------------------------------------------------------------------------------------------------------
Competitive Bid Loan Maturity Date 3**: Maximum Amount: $__________________________
$________________offered at _______________*
-----------------------, 199__ $________________offered at _______________*
-------------------------------------------------------------------------------------------------------------
_______________
* Insert the LIBO Rate Bid Margin.
** Include if applicable.
Very truly yours,
[NAME OF LENDER]
By: _________________________________
Name:
Title:
Telephone No.:
Telecopy No.:
EXHIBIT D-3
COMPETITIVE BID LOAN ACCEPTANCE
__________________, 199_
The Bank of Nova Scotia,
as Agent
000 Xxxxxxxxx Xxxxxx X.X.
Xxxxxxx, Xxxxxxx 00000
Attention:
ADT Operations, Inc.
Reference is made to the Credit Agreement, dated as of January __, 1997
(as amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among ADT Operations, Inc., a Delaware corporation (the
"Borrower"), the various financial institutions as are or may become parties
thereto (the "Lenders"), and The Bank of Nova Scotia ("Scotiabank"),
individually and as agent (the "Agent") for the Lenders. Terms defined in the
Credit Agreement and used herein shall have the meanings given to them in the
Credit Agreement.
In accordance with Section 2.3.5 of the Credit Agreement, the
undersigned accepts and confirms the offers by the Lender(s) to make
Competitive Bid Loans to the undersigned on
__, 19 under Section 2.3 of the Credit Agreement in the
(respective) amount(s) set forth on the attached list of Competitive Bid Loans
offered.
Very truly yours,
ADT OPERATIONS, INC.
By: ______________________________
Name:
Title:
[The Borrower must attach the list of Competitive Bid Loans offered prepared
by the Agent in accordance with Section 2.3.4 with the accepted amount entered
by the Borrower to right of each Competitive Bid Loan offered].
EXHIBIT F
CONTINUATION/CONVERSION NOTICE
The Bank of Nova Scotia,
as Agent
000 Xxxxxxxxx Xxxxxx X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: ______________
ADT Operations, Inc.
Gentlemen and Ladies:
This Continuation/Conversion Notice is delivered to you pursuant to
Section 2.4 of the Credit Agreement, dated as of January __, 1997 (together
with all amendments and other modifications, if any, from time to time made
thereto, the "Credit Agreement"), among ADT Operations, Inc., a Delaware
corporation (the "Borrower"), the financial institutions as are or may become
parties thereto (collectively, the "Lenders"), and The Bank of Nova Scotia
("Scotiabank"), individually and as agent (the "Agent") for the Lenders.
Unless otherwise defined herein or the context otherwise requires, terms used
herein have the meanings provided in the Credit Agreement.
The Borrower hereby requests that on _____________, 19__,
(1) $___________ of the presently outstanding principal amount of the
Revolving Loans,
(2) and all presently being maintained as (*)[Base Rate Loans] [LIBO
Rate Loans with Interest Periods ending on _______ __, 199__],
(3) be (**)[converted into] [continued as],
(4) (***)[LIBO Rate Loans having an Interest Period of [one] [two]
[three] [six] [nine] [twelve] months] [Base Rate Loans].
(****)[The Borrower hereby:
(a) certifies and warrants that no Event of Default has occurred
and is continuing; and
(*) Insert appropriate interest rate option.
(**) Insert and complete as appropriate.
(***) Complete as appropriate.
(****) Insert only upon conversion of a Base Rate Loan into a LIBO Rate
Loan or continuation of a LIBO Rate Loan.
(b) agrees that if prior to the time of such continuation or
conversion any matter certified to herein by it will not be true and
correct at such time as if then made, it will immediately so notify
the Agent.
Except to the extent, if any, that prior to the time of the continuation or
conversion requested hereby the Agent shall receive written notice to the
contrary from the Borrower, each matter certified to herein shall be deemed to
be certified at the date of such continuation or conversion as if
then made.] (*****)[The Borrower agrees to remit to the Agent for
the benefit of the Lenders, on the date of such conversion, an
interest payment in the amount of $________ pursuant to clause
(e) of Section 3.2.3 of the Credit Agreement.]
The Borrower has caused this Continuation/Conversion Notice to be
executed and delivered, and the certification and warranties contained herein
to be made, by its Authorized Officer this day of , 19 .
ADT OPERATIONS, INC.
By: ______________________________
Title:
_______________
(*****) Insert upon conversion of a Base Rate Loan into a LIBO Rate Loan
on a date other than a Quarterly Payment Date.
EXHIBIT G
LENDER ASSIGNMENT AND ACCEPTANCE AGREEMENT
To: ADT Operations, Inc.
000 Xxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
To: The Bank of Nova Scotia,
as Agent
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
ADT Operations, Inc.
Gentlemen and Ladies:
We refer to the Credit Agreement, dated as of January __, 1997 (together
with all amendments and other modifications, if any, from time to time
thereafter made thereto, the "Credit Agreement"), among ADT Operations, Inc.,
a Delaware Corporation (the "Borrower"), the financial institutions as are or
may become parties thereto (collectively, the "Lenders"), and The Bank of Nova
Scotia ("Scotiabank"), individually and as agent (the "Agent") for the
Lenders. Unless otherwise defined herein or the context otherwise requires,
terms used herein have the meanings provided in the Credit Agreement.
This Lender Assignment and Acceptance Agreement (this "Agreement") is
delivered to you pursuant to clause (ii) of Section 11.11.1 of the Credit
Agreement and also constitutes notice to each of you, pursuant to clause (i)
of Section 11.11.1 of the Credit Agreement, of the assignment and delegation
to _______________ (the "Assignee") of __% of the Competitive Bid Loans and
__% of the Revolving Loans, Revolving Loan Commitments, and Letter of
Credit Outstandings (collectively, the "Assigned Portion") of _____________
(the "Assignor") outstanding under the Credit Agreement as of ____________
(the "Assignment Date"). From and after the Assignment Date, the
Assignor's and the Assignee's Percentages for the purposes of the Credit
Agreement and each other Loan Document are set forth opposite such Person's
name on the signature pages hereof.
The Assignee is entitled to receive all payments on account of interest,
principal and fees with respect to the Assigned Portion made during the period
from and after the Assignment Date.
The Assignee hereby acknowledges and confirms that it has received a
copy of the Credit Agreement and the exhibits related thereto, together with
copies of the documents which were required to be delivered under the Credit
Agreement as a condition to the making of the Credit Extensions thereunder.
The Assignee further confirms and agrees that in becoming a Lender and in
making its Commitments and Loans under the Credit Agreement, such actions have
and will be made without recourse to, or representation or warranty by the
Agent.
The Assignor represents and warrants that (a) it is legally authorized
to enter into and deliver this Agreement, (b) this Agreement constitutes its
legal, valid and binding obligation and (c) it is the legal and beneficial
owner of the Assigned Portion, free and clear of any Lien. Except as set
forth in the previous sentence, the Assignor makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made pursuant to or in connection with this
Agreement, or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, the Credit Agreement, any other Loan
Document or any other instrument or document furnished pursuant hereto or
thereto, including the financial condition of the Borrower or any of its
Subsidiaries or the performance or observance by any Lender of any of its
obligations under the Credit Agreement, any other Loan Document or any other
instrument or document furnished pursuant hereto or thereto. The Assignee
represents and warrants that (a) it is legally authorized to enter into and
deliver this Agreement and (b) this Agreement constitutes its legal, valid and
binding obligation. The Assignee independently and without reliance upon the
Assignor, any other Lender or the Agent, and based on such documents and
information as it deems appropriate, has made its own credit determination in
entering into this Agreement, and the Assignee shall continue to make its own
credit decisions in taking or not taking action under the Credit Agreement,
the other Loan Documents and the other instruments and documents delivered in
connection therewith. The Assignee hereby appoints and authorizes the Agent
to act as such and exercise all their rights and obligations, in each case
pursuant to and in accordance with the terms of the Credit Agreement and the
other Loan Documents.
Except as otherwise provided in the Credit Agreement, effective as of
the date of acceptance hereof by the Agent
(a) the Assignee
(i) shall be deemed automatically to have become a party to
the Credit Agreement, have all the rights and obligations of a
"Lender" under the Credit Agreement and the other Loan
Documents as if it were an original signatory thereto to the
extent specified in the second paragraph hereof; and
(ii) agrees to be bound by the terms and conditions set forth
in the Credit Agreement and the other Loan Documents as if it
were an original signatory thereto; and
(b) the Assignor shall be released from its obligations under the
Credit Agreement and the other Loan Documents to the extent specified in
the second paragraph hereof.
The Assignor and the Assignee hereby agree that the [Assignor]
[Assignee] will pay to the Agent the $3,000 processing fee referred to in
Section 11.11.1 of the Credit Agreement upon the delivery hereof.
The Assignee hereby advises each of you of the following administrative
details with respect to the assigned Loans and Commitments and requests the
Agent to acknowledge receipt of this document:
(A) Address for Notices:
Institution Name:
Attention:
Domestic Office:
Telephone:
Facsimile:
LIBOR Office:
Telephone:
Facsimile:
(B) Payment Instructions:
The Assignee agrees to furnish the Internal Revenue Service form
referred to in the last paragraph of Section 5.6 (if so required) of the
Credit Agreement no later than the date of acceptance hereof by the Agent.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS OF THE STATE OF NEW YORK.
This Agreement may be executed by the Assignor and Assignee in separate
counterparts, each of which when so executed and delivered shall be deemed to
be an original and all of which taken together shall constitute one and the
same agreement.
Adjusted Percentage [ASSIGNOR]
___%
By: _______________________
Title:
Percentage [ASSIGNEE]
___%
By: _______________________
Title:
(1)[Consented to this ___ day
of __________, 19__:
ADT OPERATIONS, INC.
By: __________________________]
Title:
(2)[Consented to this ___ day
of __________, 19__:
THE BANK OF NOVA SCOTIA,
as Agent
By: __________________________]
Title:
[(2)[Consented to this ___ day
of __________, 19__:
_____________________________,
as Issuer
By: __________________________]
Title:]
_______________
(*) Include if appropriate.
EXHIBIT H
[Form of Compliance Certificate]
COMPLIANCE CERTIFICATE
ADT Operations, Inc.
ADT Limited
This Compliance Certificate is delivered pursuant to clause (e) of
Section 8.1.1 of the Credit Agreement, dated as of January 9, 1997 (together
with all amendments and other modifications, if any, from time to time
thereafter made thereto, the "Credit Agreement"), among ADT Operations, Inc.,
a Delaware corporation (the "Borrower"), the various financial institutions
as are or may become parties thereto (collectively, the "Lenders"), and The
Bank of Nova Scotia, individually and as agent (the "Agent") for the Lenders.
The Guaranty of ADT Limited, dated as of January 9, 1997, is referred to
herein as the "ADT Limited Guaranty". Unless otherwise defined herein or the
context otherwise requires, terms used herein or in any of the Attachments
hereto have the meanings provided in the Credit Agreement or the ADT Limited
Guaranty.
This Compliance Certificate relates to the _____ Fiscal Quarter (the
"Computation Period"), commencing on ________, _____ and ending on
___________, ____ (such latter date being the "Computation Date"). Each of
the Borrower and ADT Limited hereby certifies, represents and warrants that:
(a) Default.
Except as described below, as of the Computation Date, no Default or
Event of Default has occurred and is continuing.
(b) Stockholders' Equity of the Borrower.
As of the Computation Date, Stockholders' Equity of the Borrower was
$__________. The minimum amount of Stockholders' Equity of the
Borrower required by clause (a) of Section 8.2.3 of the Credit
Agreement as of such date is negative $75,000,000.
(c) Stockholders' Equity of ADT Limited.
As of the Computation Date, Stockholders' Equity of ADT Limited was
$__________. The minimum amount of Stockholders' Equity of ADT Limited
required by clause (a) of Section 4.2.4 of the ADT Limited Guaranty as
of such date is $__________.
(d) Borrower's EBITDA.
The Borrower's EBITDA for the four Fiscal Quarters ending on the
Computation Date was $__________. The minimum EBITDA of the Borrower
required by clause (b) of Section 8.2.3 of the Credit Agreement for
such period is $300,000,000.
(e) ADT Limited's Cash Flow Coverage Ratio.
ADT Limited's Cash Flow Coverage Ratio for the four Fiscal Quarters
ending on the Computation Date was to 1.0, as computed on
Attachment 1 hereto. The minimum Cash Flow Coverage Ratio of ADT
Limited required by clause (b) of Section 4.2.4 of the ADT Limited
Guaranty for such period is 1.5 to 1.0.
(f) ADT Limited's Debt to Total Capitalization Ratio.
As of the Computation Date, ADT Limited's Debt to Total Capitalization
Ratio was ____ to 1.0, as computed on Attachment 2 hereto. The maximum
Debt to Total Capitalization Ratio of ADT Limited permitted by clause
(c) of Section 4.2.4 of the ADT Limited Guaranty as of such date is 0.5
to 1.0.
(g) Business Acquisitions.
The aggregate amount of expenditures of ADT Limited and its
Subsidiaries in respect of Business Acquisitions during the portion of
ADT Limited's Fiscal Year ended on the Computation Date is $__________.
(h) Capitalized Lease Liabilities.
The aggregate amount of Capitalized Lease Liabilities incurred by ADT
Limited and its Subsidiaries during the portion of ADT Limited's Fiscal
Year ended on the Computation Date is $__________. The maximum amount
of Capitalized Lease Liabilities permitted to be incurred under the ADT
Limited Guaranty during this Fiscal Year is $30,000,000.
(i) Distributions.
(i) The sum of (A) the aggregate amount of Restricted Distributions
(other than Restricted Distributions permitted under Section
1012(b)(ii) of the Senior Note Indenture) declared during the
Computation Period and (B) the aggregate amount of payments,
prepayments, redemptions or repurchases (other than payments,
prepayments, redemptions or repurchases permitted under Section
1012(b)(iv), (v) and (vi) of the Senior Note Indenture [(which
amounted to $__________ during the Computation Period)](1)),
referred to in Section 4.2.6(c) of the ADT Limited Guaranty
that were made during the Computation Period was $__________.
The maximum amount of such Restricted Distributions and such
payments, prepayments, redemptions or repurchases permitted
by such Sections during the Computation Period is $ , as
computed on Attachment 3 hereto (Item II(F)).
(ii) The aggregate amount of Restricted Borrower Distributions
declared during the Computation Period was $__________. The
maximum amount of Restricted Borrower Distributions permitted
under Section 4.2.6(b) of the ADT Limited Guaranty during such
period is $__________.
(j) Equity Proceeds Amount.
As of the Computation Date, the Equity Proceeds Amount was $__________,
as computed on Attachment 4 hereto.
(k) Asset Dispositions, etc.
(i) The net book value of all assets sold or transferred pursuant to
clause (c)(ii) of Section 4.2.10 of the ADT Limited Guaranty (or
clause (c)(ii) of Section 4.2.10 of the ADT Limited Guaranty (as
defined in the Existing Credit Facility)) since the Existing
Credit Facility Effective Date through the Computation Date was
$__________. The maximum aggregate net book value of such
assets that may be sold or transferred since the Existing Credit
Facility Effective Date pursuant to such clause (c)(ii) is
$130,000,000.
_______________
(1) Include if applicable.
(ii) As of the Computation Date, the amount of Net Sale Proceeds
received by the Borrower, ADT Limited or any of ADT Limited's
other Subsidiaries in respect of Recapture Asset Dispositions
during the period of 18 months ending on the Computation Date
less (A) in the case of a Recapture Asset Disposition that is a
Permitted Auction Business Sale, the amount of such Net Sale
Proceeds used during such 18 month period to make payments in
respect of the Dividended Note and/or for investments in
properties and assets owned by, and used in the electronic
security businesses conducted by, the Borrower and its
Subsidiaries and (B) in the case of each other Recapture Asset
Disposition, the portion thereof invested by the Borrower, ADT
Limited and any of ADT Limited's other Subsidiaries during such
18 month period in properties and assets which will replace the
properties and assets that were the subject of such Recapture
Asset Disposition or in properties and assets used in the Core
Businesses was $__________.
(l) Consolidations, Mergers, etc.
All Permitted Business Acquisitions, Permitted Auction Business Sales
and all liquidations, dissolutions, consolidations, mergers, purchases,
or other types of acquisitions of the types described in Section 4.2.9
of the ADT Limited Guaranty and all acquisitions or creations of
Subsidiaries of ADT Limited which have occurred during the Computation
Period are disclosed in reasonable detail in Attachment 5 hereto.
IN WITNESS WHEREOF, the undersigned have caused this
Compliance Certificate to be delivered by their respective chief financial
Authorized Officers this ___ day of ____________, ____.
ADT OPERATIONS, INC.
By: ____________________________
Title:
ADT LIMITED
By: ____________________________
Title:
ATTACHMENT 1
(to__/__/__ Compliance
Certificate)
ADT LIMITED'S CASH FLOW COVERAGE RATIO
for the _____ Fiscal Quarter,
ending on __________,____
(the "Computation Date")
I. ADT Limited's Cash Flow:
-----------------------------------------------------------------
A. EBITDA (as defined in the Credit Agreement)
of ADT Limited and its Subsidiaries for the
period of four consecutive Fiscal Quarters
ending on the Computation Date (such
period, the "Calculation Period"): $_______
B. (i) All taxes computed on the basis of
income (whether local, foreign or
otherwise), to the extent paid in
cash by ADT Limited and its
Subsidiaries during the Calculation
Period: $_______
(ii) Capital Expenditures (other than
Capital Expenditures incurred in
respect of any Business Acquisition
permitted under Section 4.2.5 or
4.2.9 of the ADT Limited Guaranty)
of ADT Limited and its Subsidiaries
paid by ADT Limited and its
Subsidiaries during the Calculation
Period: $_______
(iii) The sum of Items I(B)(i) and
I(B)(ii): $_______
C. CASH FLOW: The excess of Item I(A) over
Item I(B) (iii): $_______
D. CAPITAL EXPENDITURES OF ADT LIMITED AND ITS
SUBSIDIARIES PAID DURING THE CALCULATION
PERIOD WITH EQUITY PROCEEDS, TO THE EXTENT
INCLUDED IN ITEM I(B)(ii): $_______
E. ADJUSTED CASH FLOW: The sum of Item I(C)
and Item I(D): $_______
II. ADT Limited's Cash Flow Coverage Ratio:
A. Adjusted Cash Flow of ADT Limited and its
Subsidiaries for the Calculation Period
(see Item I(E) above): $_______
B. Interest Expense (as defined in the Credit
Agreement) of ADT Limited and its
Subsidiaries for the Calculation Period: $_______
C. ADT LIMITED'S CASH FLOW COVERAGE RATIO:
The ratio of Item II(A) to Item II(B): _____ to 1.0
ATTACHMENT 2
(to __/__/__ Compliance
Certificate)
ADT LIMITED'S DEBT TO TOTAL CAPITALIZATION RATIO
for the ______ Fiscal Quarter,
ending on __________, ____
(the "Computation Date")
ADT Limited's Debt to Total Capitalization Ratio:
A. As at the Computation Date, the
aggregate amount of Debt (as defined in
the Credit Agreement) of ADT Limited and
its Subsidiaries, determined on a
consolidated basis: $_______
B. As at the Computation Date, Stockholders'
Equity (as defined in the Credit Agreement)
of ADT Limited $_______
C. TOTAL CAPITALIZATION: The sum of
Items A and B: $_______
D. ADT LIMITED'S DEBT TO TOTAL
CAPITALIZATION RATIO: The ratio of
Item A to Item C: _____ to 1.0
ATTACHMENT 3
(to __/__/__ Compliance
Certificate)
RESTRICTED DISTRIBUTIONS
for the ______ Fiscal Quarter,
ending on __________, ____
(the "Computation Date")
I. Restricted Payment Basket Amount:
A. 50% of the aggregate Consolidated Adjusted
Net Income (as defined in the Senior Note
Indenture) of ADT Limited accrued on a
cumulative basis during the period (taken as
one accounting period) from August 4, 1993 to
the last day of the Fiscal Quarter
immediately preceding the Fiscal Quarter as
to which this Compliance Certificate is being
delivered (or, if such aggregate cumulative
Consolidated Adjusted Net Income shall be a
loss, 100% of such loss): $_______
B. The aggregate net cash proceeds received by
ADT Limited after August 4, 1993 from the
issuance or sale (other than to a Restricted
Subsidiary (as defined in the Senior Note
Indenture)) of shares of its Capital Stock
(other than Redeemable Capital Stock) or
warrants, options or rights to purchase such
shares of Capital Stock (other than
Redeemable Capital Stock): $_______
C. The aggregate net cash proceeds received by
ADT Limited after August 4, 1993 (other than
from the Borrower or another Restricted
Subsidiary (as defined in the Senior Note
Indenture)) upon the exercise of options,
warrants or rights to purchase shares of
Capital Stock of ADT Limited (other than
Redeemable Capital Stock): $_______
D. The aggregate net cash proceeds received by
ADT Limited after August 4, 1993 from the
issuance or sale (other than to the Borrower
or another Restricted Subsidiary (as defined
in the Senior Note Indenture)) of debt
securities or Redeemable Capital Stock that
have been converted into or exchanged for
Capital Stock of ADT Limited (other than
Redeemable Capital Stock), together with the
aggregate cash received by ADT Limited at the
time of such conversion or exchange: $_______
E. Subtotal: The sum of Items I(A), (B), (C)
and (D), treating the amount of Item I(A) as
a negative number if such amount is in
respect of an aggregate cumulative loss: $_______
F. The aggregate amount of all Restricted
Payments (as defined in the Senior Note
Indenture) (other than Restricted Payments
permitted under Section 1012(b)(ii), (iv),
(v) and (vi) of the Senior Note Indenture)
declared or paid during the period from
August 4, 1993 to the last day of the Fiscal
Quarter immediately preceding the Fiscal
Quarter as to which this Compliance
Certificate is being delivered: $_______
G. RESTRICTED PAYMENT BASKET AMOUNT: The excess
of Item I(E) over Item I(F): $_______
II. Adjustment to Restricted Payment Basket Amount:
A. Aggregate amount expended on Permitted
Business Acquisitions (other than the ASH
Transaction to the extent the aggregate
consideration therefor did not exceed
$425,000,000) after the Existing Credit
Facility Effective Date in excess of the
applicable Annual Limits (or, during the
effectiveness of the Existing Credit
Facility, the applicable Annual Limits (as
defined under the Existing Credit Facility)): $_______
B. Aggregate amount of Capital Expenditures made
after the Existing Credit Facility Effective
Date and designated in Item I(D) of
Attachment 1 of this Compliance Certificate
and each Compliance Certificate (including
any Compliance Certificate (as defined under
the Existing Credit Facility)) delivered
since the Existing Credit Facility Effective
Date: $_______
C. The sum of Items II(A) and (B): $_______
D. The portion of Item II(C) which resulted in a
decrease of the Restricted Payment Basket
Amount: $_______
E. ADJUSTMENT: The excess of Item II(C) over
Item II(D): $_______
F. ADJUSTED RESTRICTED PAYMENT BASKET AMOUNT:
The excess of Item I(G) over Item II(E): $_______
ATTACHMENT 4
(to __/__/__ Compliance
Certificate)
EQUITY PROCEEDS AMOUNT
for the _________ Fiscal Quarter
ending on ____________, ____
(the "Computation Date")
A. The Equity Proceeds Amount as of the last day
of the Fiscal Quarter immediately preceding
the Fiscal Quarter as to which this Compliance
Certificate is being delivered**: $_______
B. (i) the aggregate net cash proceeds
received by ADT Limited during the
Computation Period from the issuance
or sale (other than to a Subsidiary of
ADT Limited) of shares of its Capital
Stock (other than Redeemable Capital
Stock) or warrants, options or rights
to purchase such shares of Capital
Stock (other than Redeemable Capital
Stock): $_______
(ii) The aggregate net cash proceeds
received by ADT Limited during the
Computation Period (other than from
the Borrower or any other Subsidiary
of ADT Limited) upon the exercise of
options, warrants or rights to
purchase shares of Capital Stock of
ADT Limited (other than Redeemable
Capital Stock): $_______
(iii) The aggregate net cash proceeds
received by ADT Limited during the
Computation Period from the issuance
or sale (other than to the Borrower or
any other Subsidiary of ADT Limited)
of debt securities or Redeemable
Capital Stock that have been converted
into or exchanged for Capital Stock of
ADT Limited (other than Redeemable
Capital Stock), together with the
aggregate cash received by ADT Limited
at the time of such conversion or
exchange: $_______
C. The sum of Items A, B(i), (ii), and (iii): $_______
D. The amount of each Restricted Payment (as
defined under the Senior Note Indenture) made
after ADT Limited shall have received cash
proceeds of the type referred to in Item B
(whether during or prior to the Computation
Period) which, pursuant to the terms of the
Senior Note Indenture, decreases the
Restricted Payment Basket Amount: $_______
E. The greater of (i) zero and (ii) the excess of
Item C over Item D: $_______
F. The amount expended during the Computation
Period on Permitted Business Acquisitions
(other than the ASH Transaction to the extent
the aggregate consideration therefor did not
exceed $425,000,000) in excess of the
applicable Annual Limit (or, during the
effectiveness of the Existing Credit Facility,
the applicable Annual Limit (as defined under
the Existing Credit Facility)): $_______
G. The amount of Capital Expenditures made during
the Computation Period with the cash proceeds
referred to in Item B (whether received during
or prior to the Computation Period) and
designated in Item I(D) of Attachment 1 of
this Compliance Certificate: $_______
H. EQUITY PROCEEDS AMOUNT AS OF THE
COMPUTATION DATE: The excess of (i) Item E
over (ii) the sum of Items F and G: $_______
_______________
** The Equity Proceeds Amount as of September 30, 1996 to be inserted in
the first Compliance Certificate delivered under the Credit Agreement.
ATTACHMENT 5
(to __/__/__ Compliance
Certificate)
CONSOLIDATIONS, MERGERS, ETC.
for the _____ Fiscal Quarter,
ending on __________, ____
(the "Computation Date")
EXHIBIT I
[CONFORMED COPY]
GUARANTY,
dated as of January 9, 1997,
made by
ADT LIMITED
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
SECTION
------- Page
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1.1. Certain Terms.................................................... 1
1.2. Credit Agreement Definitions..................................... 6
ARTICLE II
GUARANTY PROVISIONS
2.1. Guaranty......................................................... 6
2.2. Guaranty Absolute, etc........................................... 6
2.3. Stay of Acceleration, Reinstatement, etc......................... 8
2.4. Waiver, etc...................................................... 8
2.5. Subrogation...................................................... 9
2.6. Successors, Transferees and Assigns; Transfers of Notes, etc..... 9
2.7. Payments Free and Clear of Taxes, etc............................ 10
2.8. Judgment......................................................... 11
2.9. Consent to Jurisdiction; Waiver of Immunities.................... 12
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1. Organization, etc................................................ 13
3.2. Due Authorization, Non-Contravention, etc........................ 13
3.3. Government Approval, Regulation, etc............................. 14
3.4. Validity, etc.................................................... 14
3.5. Financial Information............................................ 14
3.6. No Material Adverse Change....................................... 15
3.7. Litigation, Labor Controversies, etc............................. 15
3.8. Subsidiaries..................................................... 15
3.9. Ownership of Properties.......................................... 16
3.10. Taxes............................................................ 16
3.11. Pension and Welfare Plans........................................ 16
3.12. Environmental Warranties......................................... 16
3.13. Regulations G, U and X........................................... 18
3.14. No Defaults...................................................... 18
3.15. Delivery of Organizational Chart................................. 19
3.16. Accuracy of Information.......................................... 19
3.17. Restricted Payment Basket Amount; Equity Proceeds Amount......... 20
3.18. Restricted Borrower Distributions................................ 20
ARTICLE IV
COVENANTS, ETC.
4.1. Affirmative Covenants............................................. 20
4.1.1. Compliance with Laws, etc......................................... 20
4.1.2. Maintenance of Properties......................................... 21
4.1.3. Insurance......................................................... 21
4.1.4. Books and Records................................................. 21
4.1.5. Environmental Covenant............................................ 22
4.1.6. Guaranty Supplements.............................................. 22
4.1.7. Maintenance of Adequate Guarantees................................ 22
4.2. Negative Covenants................................................ 23
4.2.1. Business Activities............................................... 23
4.2.2. Indebtedness...................................................... 23
4.2.3. Liens............................................................. 26
4.2.4. Financial Condition............................................... 28
4.2.5. Investments....................................................... 28
4.2.6. Restricted Payments, etc.......................................... 31
4.2.7. Capital Expenditures, etc......................................... 35
4.2.8. [Intentionally Omitted.].......................................... 36
4.2.9. Consolidation, Merger, etc........................................ 36
4.2.10. Asset Dispositions, etc........................................... 37
4.2.11. Modification of Certain Documents................................. 38
4.2.12. Transactions with Affiliates...................................... 39
4.2.13. Negative Pledges, Restrictive Agreements, etc..................... 39
4.2.14. Accounting Changes................................................ 41
4.2.15. Ability to Amend; Restrictive Agreements.......................... 41
4.2.16. [Intentionally Omitted.].......................................... 41
4.2.17. Activities of Certain Subsidiaries................................ 41
4.2.18. Ownership of Certain Subsidiaries................................. 42
4.2.19. Certain Intercompany Indebtedness................................. 42
4.2.20. Any Action........................................................ 42
ARTICLE V
MISCELLANEOUS PROVISIONS
5.1. Loan Document.................................................... 42
5.2. Binding on Successors, Transferees and Assigns; Assignment....... 43
5.3. Amendments, etc.................................................. 43
5.4. Addresses for Notices............................................ 43
5.5. No Waiver; Remedies.............................................. 43
5.6. Captions......................................................... 44
5.7. Setoff........................................................... 44
5.8. Independence of Covenants........................................ 44
5.9. Severability..................................................... 44
5.10. Governing Law.................................................... 44
5.11. Waiver of Jury Trial............................................. 45
DISCLOSURE SCHEDULE
GUARANTY
THIS GUARANTY (this "Guaranty"), dated as of January 9, 1997, made by
ADT LIMITED, a company organized under the laws of Bermuda ("ADT Limited"), in
favor of each of the Lender Parties (as defined below),
W I T N E S S E T H:
WHEREAS, pursuant to a Credit Agreement, dated as of the date hereof
(together with all amendments and other modifications, if any, from time to
time thereafter made thereto, the "Credit Agreement"), among ADT Operations,
Inc., a Delaware corporation (the "Borrower"), the financial institutions as
are or may become parties thereto (collectively, the "Lenders"), The Bank of
Nova Scotia ("Scotiabank"), individually and as agent (the "Agent") for the
Lenders, the Lenders have extended Commitments to make Credit Extensions to
the Borrower; and
WHEREAS, as a condition precedent to the making of the initial Credit
Extension under the Credit Agreement, ADT Limited is required to execute and
deliver this Guaranty; and
WHEREAS, ADT Limited has duly authorized the execution, delivery and
performance of this Guaranty; and
WHEREAS, it is in the best interests of ADT Limited to execute this
Guaranty inasmuch as ADT Limited will derive substantial direct and indirect
benefits from the Credit Extensions made from time to time to the Borrower by
the Lenders pursuant to the Credit Agreement;
NOW, THEREFORE, for good and valuable consideration the receipt of which
is hereby acknowledged, and in order to enable the Borrower to obtain more
favorable interest rates and terms, ADT Limited agrees, for the benefit of
each Lender Party, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Certain Terms. The following terms (whether or not
underscored) when used in this Guaranty, including its preamble and
recitals, shall have the following meanings (such definitions to be equally
applicable to the singular and plural forms thereof):
"ADT Limited" is defined in the preamble.
"Agent" is defined in the first recital and includes each other
Person which may be appointed as any successor agent pursuant to the Credit
Agreement.
"Annual Limit" is defined in subclause (a)(i) of the definition of
"Permitted Business Acquisition" in Section 1.1.
"ASH Transaction" means, collectively, (i) the acquisition by ADT
Limited on September 6, 1996 of the entire Capital Stock of ASH pursuant to
a stock-for-stock exchange in which the stockholders of ASH received Common
Shares and (ii) in connection with such acquisition, (A) the repayment of
certain Indebtedness of ASH and its Subsidiaries and (B) the guaranty by
ADT Limited of certain Indebtedness of ASH and its Subsidiaries in an
aggregate principal amount not exceeding $70,000,000, which Indebtedness
remained outstanding following such acquisition, and the assumption by ADT
Limited of certain obligations to deliver Common Shares upon the conversion
of such Indebtedness.
"Asset Sale" is defined in Section 4.2.10.
"Borrower" is defined in the first recital.
"Business Acquisition" means the acquisition, by purchase or
otherwise, of all or substantially all of the assets (or any part of the
assets constituting all or substantially all of a business or line of
business) of any Person, whether such acquisition is direct or indirect,
including through the acquisition of the business of, or Capital Stock of,
such Person.
"Credit Agreement" is defined in the first recital.
"Disclosure Schedule" means the Disclosure Schedule attached hereto
as Schedule I, as it may be amended, supplemented or otherwise modified
from time to time by ADT Limited with the written consent of the Agent and
the Required Lenders.
"Equity Proceeds Amount" means, with respect to any proposed
Permitted Business Acquisition in excess of the Annual Limit or any
addition to Cash Flow in respect of Capital Expenditures in connection with
the computation of the Cash Flow Coverage Ratio of ADT Limited,
(a) an amount equal to
(i) the aggregate net cash proceeds received by ADT Limited
after the Indenture Effective Date from the issuance or sale (other
than to a Subsidiary of ADT Limited) of shares of its Capital Stock
(other than Redeemable Capital Stock) or warrants, options or
rights to purchase such shares of Capital Stock (other than
Redeemable Capital Stock),
plus
(ii) the aggregate net cash proceeds received by ADT Limited
after the Indenture Effective Date (other than from the Borrower or
any other Subsidiary of ADT Limited) upon the exercise of options,
warrants or rights to purchase shares of Capital Stock of ADT
Limited (other than Redeemable Capital Stock),
plus
(iii) the aggregate net cash proceeds received by ADT Limited
after the Effective Date from the issuance or sale (other than to
the Borrower or any other Subsidiary of ADT Limited) of debt
securities or Redeemable Capital Stock that have been converted
into or exchanged for Capital Stock of ADT Limited (other than
Redeemable Capital Stock), together with the aggregate cash
received by ADT Limited at the time of such conversion or exchange,
as decreased from time to time by
(b) (i) the amount of each Restricted Payment (as defined under
the Senior Note Indenture) made after ADT Limited shall have received
the cash proceeds referred to in the preceding clause (a) which,
pursuant to the terms of the Senior Note Indenture, decreases the
Restricted Payment Basket Amount; provided that any such decrease to
the Equity Proceeds Amount shall not result in the Equity Proceeds
Amount being less than zero,
(ii) the amount expended after the Existing Credit Facility
Effective Date on Permitted Business Acquisitions (other than the ASH
Transaction to the extent the aggregate consideration therefor did not
exceed $425,000,000) in excess of the Annual Limit (or, during the
effectiveness of the Existing Credit Facility, the applicable Annual
Limits (as defined under the Existing Credit Facility)), and
(iii) the amount of Capital Expenditures made after the Existing
Credit Facility Effective Date with the cash proceeds referred to in
the preceding clause (a) and designated as such pursuant to the
Compliance Certificate (including any compliance certificate delivered
under the Existing Credit Facility) delivered in connection with the
Fiscal Quarter in which such Capital Expenditures were paid.
"Existing Credit Facility Effective Date" means August 23, 1995.
"Lender Party" means, as the context may require, any Lender, any
Issuer or the Agent and each of their respective successors, transferees
and assigns.
"Lenders" is defined in the first recital.
"Other Taxes" is defined in clause (b) of Section 2.7.
"Permitted Business Acquisition" means any Business Acquisition of a
Core Business, exclusive, however, of (i) acquisitions of Minority
Interests and (ii) acquisitions of Capital Stock in any Related Business,
so long as
(a) the aggregate amount of expenditures of ADT Limited and its
Subsidiaries in respect of such Business Acquisition (such amount,
the "Subject Amount"), when added to the aggregate amount of all
expenditures of ADT Limited and its Subsidiaries in respect of
Business Acquisitions during the Fiscal Year in which such Subject
Amount would be expended, does not exceed the sum of (i)
$130,000,000 (the "Annual Limit") and (ii) the Equity Proceeds
Amount, as determined immediately prior to the making of such
expenditure, and
(b) in the event the Subject Amount (which amount shall include,
in the event such Business Acquisition is to be consummated in a
series of related transactions, the aggregate amount of all
expenditures of ADT Limited and its Subsidiaries in respect of such
related transactions) would exceed $50,000,000, the Agent shall have
received a certificate executed by the chief financial Authorized
Officer of ADT Limited certifying and, if reasonably requested by
the Agent, showing (in reasonable detail and with appropriate
calculations and computations in all respects reasonably
satisfactory to the Agent) that on a historical pro forma basis
(after giving effect to such Business Acquisition and all
transactions related thereto (including all Indebtedness that would
be assumed or incurred as a result of such acquisition) and all
Business Acquisitions consummated prior thereto during the
applicable periods thereunder) as of the last day of the most
recently completed Fiscal Quarter with respect to which, pursuant to
Section 8.1.1(a) or 8.1.1(d) of the Credit Agreement (or Section
8.1.1(d) of the Existing Credit Facility), financial statements have
been, or are required to have been, delivered by the Borrower, ADT
Limited and the Borrower would be in compliance with Section 4.2.4
as of the last day of such Fiscal Quarter and Section 8.2.3 of the
Credit Agreement as of the last day of such Fiscal Quarter (or, if
such last day of such Fiscal Quarter is September 30, 1996, Section
8.2.3 of the Existing Credit Facility).
"Permitted Strategic Holder" means any Person (other than an
Affiliate of ADT Limited) whose purchase of Voting Stock is in the best
interest of the Subsidiary whose Voting Stock is being purchased (as
determined in good faith by the Board of Directors of ADT Limited or a
committee thereof, whose determination shall be conclusive and evidenced by
a certified written resolution of such Board or committee).
"Permitted Strategic Sale" means a sale by any Subsidiary of ADT
Limited of Voting Stock of any Subsidiary (other than the Borrower or an
Intermediate Parent Company) to any Permitted Strategic Holder; provided,
however, that (a) after giving effect to such transaction, the aggregate
percentage of the Voting Stock of such Subsidiary so sold shall not exceed
19% (or, in the case of any Subsidiary of an Intermediate Parent Company
that is required to file a consolidated tax return under United States
Federal tax laws and regulations, such lesser percentage as will not cause
such Subsidiary to become an unconsolidated subsidiary under such laws and
regulations) of all Voting Stock of such Subsidiary outstanding immediately
after such sale and (b) the consideration received in such sale (i) shall
be 100% cash (including any cash proceeds received from the sale of
securities received in such Permitted Strategic Sale, provided that at the
time of such Permitted Strategic Sale, ADT Limited or the relevant
Subsidiary has entered into a legally binding agreement for the sale of
such securities and such securities are sold within 60 days of such
Permitted Strategic Sale) and (ii) shall be not less than the Fair Market
Value of the Voting Stock sold (as determined in good faith by the Board of
Directors of ADT Limited or a committee thereof, whose determination shall
be conclusive and evidenced by a certified written resolution of such Board
or committee).
"Process Agent" is defined in clause (a) of Section 2.9.
"Restricted Distribution" is defined in Section 4.2.6(a).
"Restricted Borrower Distribution" is defined in Section 4.2.6(b).
"Restricted Payment Basket Amount" means, at any date, the amount
available on such date under clause (C) of Section 1012(a) of the Senior
Note Indenture for the making of Restricted Payments (as defined
thereunder).
"Taxes" is defined in clause (a) of Section 2.7.
"U.K. Credit Facility" is defined in clause (d)(ii) of Section
4.2.2.
SECTION 1.2. Credit Agreement Definitions. Unless otherwise
defined herein or the context otherwise requires, terms used in this
Guaranty, including its preamble and recitals, have the meanings provided
in the Credit Agreement.
ARTICLE II
GUARANTY PROVISIONS
SECTION 2.1. Guaranty. ADT Limited hereby absolutely,
unconditionally and irrevocably
(a) guarantees the full and punctual payment when due, whether
at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise, of all Obligations of the
Borrower and each other Obligor now or hereafter existing, whether
for principal, interest, Reimbursement Obligations, fees, expenses
or otherwise (including all such amounts which would become due but
for the operation of the automatic stay under Section 362(a) of the
United States Bankruptcy Code, 11 U.S.C. Section 362(a), and the
operation of Sections 502(b) and 506(b) of the United States
Bankruptcy Code, 11 U.S.C. Section 502(b) and Section 506(b)); and
(b) indemnifies and holds harmless each Lender Party and each
holder of a Note for any and all costs and expenses (including
reasonable attorney's fees and expenses) incurred by such Lender
Party or such holder, as the case may be, in enforcing any rights
under this Guaranty.
This Guaranty constitutes a guaranty of payment when due and not of
collection, and ADT Limited specifically agrees that it shall not be
necessary or required that any Lender Party or any holder of any Note
exercise any right, assert any claim or demand or enforce any remedy
whatsoever against the Borrower or any other Obligor (or any other Person)
before or as a condition to the obligations of ADT Limited hereunder.
SECTION 2.2. Guaranty Absolute, etc. This Guaranty shall in all
respects be a continuing, absolute, unconditional and irrevocable guaranty
of payment, and shall remain in full force and effect until all Obligations
of the Borrower and each other Obligor have been paid in full, all
obligations of ADT Limited hereunder shall have been paid in full and all
Commitments shall have terminated. ADT Limited guarantees that the
Obligations of the Borrower and each other Obligor and their respective
Subsidiaries will be paid strictly in accordance with the terms of the
Credit Agreement and each other Loan Document under which they arise,
without regard (to the fullest extent permitted under applicable law) to
any law, regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of any Lender Party or any holder
of any Note with respect thereto (and ADT Limited hereby waives to the
fullest extent it may do so any right or rights it may have under any such
law, regulation or order). Without limiting the generality of the
foregoing, the liability of ADT Limited under this Guaranty shall be
absolute, unconditional and irrevocable irrespective of:
(a) any lack of genuineness, validity, legality or
enforceability of the Credit Agreement, any Note, any Letter of
Credit or any other Loan Document (other than this Guaranty) or of
any of the Obligations (other than the Obligations of ADT Limited
hereunder);
(b) the failure of any Lender Party or any holder of any Note
(i) to assert any claim or demand or to enforce any right or
remedy against the Borrower, any other Obligor or any other
Person (including any other guarantor) under the provisions of
the Credit Agreement, any Note, any Letter of Credit, any other
Loan Document or otherwise, or
(ii) to exercise any right or remedy against any other
guarantor (including any other Guarantor) of, or collateral
securing, any Obligations of the Borrower or any other Obligor;
(c) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations of the Borrower or
any other Obligor (other than ADT Limited), or any other extension,
compromise or renewal of any Obligation of the Borrower or any other
Obligor (other than ADT Limited);
(d) any reduction, limitation, impairment or termination of the
Obligations of the Borrower or any other Obligor (other than ADT
Limited) for any reason, including any claim of waiver, release,
surrender, alteration or compromise, and shall not be subject to
(and ADT Limited hereby waives any right to or claim of) any defense
or setoff, counterclaim, recoupment or termination whatsoever by
reason of the invalidity, illegality, nongenuineness, irregularity,
compromise, unenforceability of, or any other event or occurrence
affecting, the Obligations of the Borrower, any other Obligor (other
than ADT Limited) or otherwise;
(e) any amendment to, rescission, waiver, or other modification
of, or any consent to departure from, any of the terms of the Credit
Agreement, any Note, any Letter of Credit or any other Loan Document
(other than this Guaranty);
(f) any addition, exchange, release, surrender or non-perfection
of any collateral, or any amendment to or waiver or release or
addition of, or consent to departure from, any other guaranty (or
any other Guarantee), held by any Lender Party or any holder of any
Note securing any of the Obligations of the Borrower or any other
Obligor; or
(g) any other circumstance which might otherwise constitute a
defense available to, or a legal or equitable discharge of, the
Borrower, any other Obligor, any surety or any other guarantor (or
any other Guarantor).
SECTION 2.3. Stay of Acceleration, Reinstatement, etc. ADT Limited
agrees that, if acceleration of the time for payment of any amount payable
by the Borrower under the Credit Agreement, the Notes or any other Loan
Document or of compliance by the Borrower with its obligations under
Section 4.7 of the Credit Agreement is, in either case, stayed upon the
occurrence with respect to the Borrower of any Event of Default described
in clause (b) or (d) of Section 9.1.9 of the Credit Agreement, all such
amounts and obligations otherwise subject to acceleration or compliance
under the terms of the Credit Agreement shall nonetheless be payable and
performed by ADT Limited hereunder forthwith on demand by the Agent made at
the request of the requisite proportion of the Lenders specified in Section
9.3 of the Credit Agreement. ADT Limited agrees that this Guaranty shall
continue to be effective or be reinstated, as the case may be, if at any
time any payment (in whole or in part) of any of the Obligations is
rescinded or must otherwise be restored by any Lender Party or any holder
of any Note, upon the insolvency, bankruptcy or reorganization of the
Borrower, any other Obligor (other than ADT Limited) or otherwise, all as
though such payment had not been made.
SECTION 2.4. Waiver, etc. ADT Limited hereby waives promptness,
diligence, notice of acceptance and any other notice with respect to any of
the Obligations of the Borrower or any other Obligor and this Guaranty and
any requirement that any Agent, any other Lender Party or any holder of any
Note protect, secure, perfect or insure any security interest or Lien, or
any property subject thereto, or exhaust any right or take any action
against the Borrower, any other Obligor or any other Person (including any
other guarantor and any other Guarantor) or entity or any collateral
securing the Obligations of the Borrower or any other Obligor, as the case
may be.
SECTION 2.5. Subrogation. ADT Limited hereby agrees that it will
not exercise any rights which it may now or hereafter acquire against the
Borrower or any other Obligor that arise from the existence, payment,
performance or enforcement of ADT Limited's obligations under this Guaranty
or any other Loan Document, including any right of subrogation,
reimbursement, exoneration, or indemnification, any right to participate in
any claim or remedy of the Lender Parties against the Borrower or any other
Obligor or any collateral which any Agent now has or hereafter acquires,
whether or not such claim, remedy or right arises in equity, or under
contract, statute or common law, including the right to take or receive
from the Borrower or any other Obligor, directly or indirectly, in cash or
other property or by set-off or in any manner, payment or security on
account of such claim or other rights, until the Obligations have been paid
in full in cash and the Commitments have been terminated. If any amount
shall be paid to ADT Limited in violation of the preceding sentence and the
Obligations shall not have been paid in cash in full and the Commitments
have not been terminated, such amount shall be deemed to have been paid to
ADT Limited for the benefit of, and held in trust for, the Lender Parties,
and shall forthwith be paid to the Lender Parties to be credited and
applied to the Obligations, whether matured or unmatured. ADT Limited
acknowledges that it will receive direct and indirect benefits from the
financing arrangements contemplated by the Credit Agreement and that the
agreement set forth in this Section is knowingly made in contemplation of
such benefits.
SECTION 2.6. Successors, Transferees and Assigns; Transfers of
Notes, etc. This Guaranty shall:
(a) be binding upon ADT Limited, and its successors, transferees
and assigns; and
(b) inure to the benefit of and be enforceable by the Agent and
each other Lender Party.
Without limiting the generality of clause (b), any Lender may assign or
otherwise transfer (in whole or in part) any Note or Loan held by it to any
other Person or entity, and such other Person or entity shall thereupon
become vested with all rights and benefits in respect thereof granted to
such Lender under any Loan Document (including this Guaranty) or otherwise,
subject, however, to the provisions of Section 11.11 and Article X of the
Credit Agreement.
SECTION 2.7. Payments Free and Clear of Taxes, etc. ADT Limited
hereby agrees that:
(a) Any and all payments made by ADT Limited hereunder shall be
made in accordance with Section 5.6 of the Credit Agreement free and
clear of, and without deduction for, any and all present or future
taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of each
Lender Party or any holder of a Note, taxes imposed on its income,
and franchise taxes imposed on it, by the jurisdiction under the
laws of which such Lender Party or such holder, as the case may be,
is organized and by any political subdivision thereof and, in the
case of each Lender, taxes imposed on its income, and franchise
taxes imposed on it, by the jurisdiction of such Lender's Domestic
Office or LIBOR Office and any political subdivision thereof (all
such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as
"Taxes"). If ADT Limited shall be required by law to deduct any
Taxes from or in respect of any sum payable hereunder to any Lender
Party or any holder of a Note
(i) the sum payable shall be increased as may be necessary
so that after making all required deductions (including
deductions applicable to additional sums payable under this
Section) such Lender Party or such holder, as the case may be,
receives an amount equal to the sum it would have received had
no such deductions been made,
(ii) ADT Limited shall make such deductions, and
(iii) ADT Limited shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance
with applicable law.
(b) ADT Limited shall pay any present or future stamp or
documentary taxes or any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or from
the execution, delivery or registration of, or otherwise with
respect to, this Guaranty (hereinafter referred to as
"Other Taxes").
(c) ADT Limited hereby indemnifies and holds harmless each
Lender Party and each holder of a Note for the full amount of Taxes
or Other Taxes (including, without limitation, any Taxes or Other
Taxes imposed by any jurisdiction on amounts payable under this
Section) paid by such Lender Party or such holder, as the case may
be, and any liability (including penalties, interest and expenses)
arising therefrom or with respect thereto, whether or not such Taxes
or Other Taxes were correctly or legally asserted.
(d) Within 30 days after the date of any payment of Taxes or
Other Taxes, ADT Limited will furnish to the Agent the original or a
certified copy of a receipt evidencing payment thereof. If no Taxes
or Other Taxes are payable in respect of any payment hereunder to
any Lender Party or any holder of a Note, ADT Limited will furnish
to the Agent upon its reasonable request (which request shall not be
made more than once per Fiscal Year) a certificate from each
appropriate taxing authority, or an opinion of counsel acceptable to
the Agent, in either case stating that such payment is exempt from
or not subject to Taxes or Other Taxes.
(e) Without prejudice to the survival of any other agreement of
ADT Limited hereunder, the agreements and obligations of ADT Limited
contained in this Section 2.7 shall survive the payment in full of
the principal of and interest on the Loans.
SECTION 2.8. Judgment. ADT Limited hereby agrees that to the
fullest extent permitted by applicable law:
(a) if, for the purposes of obtaining judgment in any court, it is
necessary to convert a sum due hereunder in United States Dollars
into another currency, ADT Limited agrees that the rate of exchange
used shall be that at which in accordance with normal banking
procedures the Agent could purchase United States Dollars with such
other currency on the Business Day preceding that on which final
judgment is given; and
(b) the obligation of ADT Limited in respect of any sum due from
it to any Lender Party or any holder of a Note hereunder shall,
notwithstanding any judgment in a currency other than United States
Dollars, be discharged only to the extent that on the Business Day
following receipt by such Lender Party or such holder, as the case
may be, of any sum adjudged to be so due in such other currency such
Lender Party or such holder, as the case may be, may, in accordance
with normal banking procedures, purchase United States Dollars with
such other currency; in the event that the United States Dollars so
purchased are less than the sum originally due to such Lender Party
in United States Dollars, ADT Limited, as a separate obligation and
notwithstanding any such judgment, hereby indemnifies and holds
harmless such Lender Party and such holder against such loss, and if
the United States Dollars so purchased exceed the sum originally due
to such Lender Party or such holder in United States Dollars, such
Lender Party or such holder, as the case may be, shall remit to ADT
Limited such excess.
SECTION 2.9. Consent to Jurisdiction; Waiver of Immunities. ADT
Limited hereby acknowledges and agrees that:
(a) It has irrevocably submitted to the jurisdiction of the
courts of the State of New York and of the United States District
Court for the Southern District of New York for the purposes of any
action or proceeding arising out of or relating to this Guaranty,
and ADT Limited hereby irrevocably agrees that all claims in respect
of such action or proceeding may be heard and determined in such New
York state or federal court. ADT Limited hereby irrevocably waives,
to the fullest extent it may effectively do so, the defense of an
inconvenient forum to the maintenance of such action or proceeding.
ADT Limited hereby irrevocably appoints Xxx, Xxxxxxx & Xxxxx (the
"Process Agent"), with an office on the date hereof at 0 Xxx
Xxxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx, Xxxxxx Xxxxxx (Attention:
Xxx Xxxxxxxxxxx), as its agent to receive on behalf of ADT Limited
and its property service of copies of the summons and complaint and
any other process which may be served in any such action or
proceeding. Such service may be made by mailing or delivering a
copy of such process to ADT Limited in care of the Process Agent at
the Process Agent's above address, and ADT Limited hereby
irrevocably authorizes and directs the Process Agent to accept such
service on its behalf. As an alternative method of service, ADT
Limited also irrevocably consents to the service of any and all
process in any such action or proceeding by the mailing of copies of
such process to ADT Limited at its address specified on the
signature page hereof. ADT Limited hereby agrees that in the event
the Process Agent is no longer resident in New York, New York, it
shall appoint a successor Process Agent resident in New York, New
York reasonably acceptable to the Agent, which successor Process
Agent shall thereafter be the Process Agent hereunder. ADT Limited
agrees that a final judgment in any such action or proceeding shall
be conclusive and may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by law.
(b) Nothing in this Section shall affect the right of any
Lender Party or any holder of any Note to serve legal process in any
other manner permitted by law or affect the right of any Lender
Party or any holder of any Note to bring any action or proceeding
against ADT Limited or any of its properties in the courts of any
other jurisdictions.
(c) To the extent that ADT Limited has or hereafter may acquire
any immunity from jurisdiction of any court or from any legal
process (whether through service or notice, attachment prior to
judgment, attachment in aid of execution, execution or otherwise)
with respect to itself or its property, ADT Limited hereby
irrevocably waives, to the fullest extent permitted under applicable
law, such immunity in respect of its obligations under this
Guaranty.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
ADT Limited hereby represents and warrants unto each Lender Party as
set forth in this Article III.
SECTION 3.1. Organization, etc. Each of ADT Limited and its
Subsidiaries that is an Obligor or a Material Related Party is a company or
corporation, as the case may be, duly organized and validly existing and,
to the extent applicable, in good standing under the laws of the
jurisdiction of its organization, is duly qualified to do business and is,
to the extent applicable, in good standing as a foreign corporation in each
jurisdiction where the nature of its business requires such qualification
and where the failure to so qualify or be in good standing would reasonably
be expected to have a material adverse effect on the business, results of
operations, financial condition or prospects of ADT Limited and its
Subsidiaries taken as a whole. Each of ADT Limited and its Subsidiaries
that is an Obligor or a Material Related Party has full power and authority
and holds all requisite governmental licenses, permits and other approvals
(i) to own and hold under lease its property and to conduct its business
substantially as currently conducted by it, except where failure to hold
such licenses, permits and other approvals would not reasonably be expected
to have a material adverse effect on the business, results of operations,
financial condition or prospects of ADT Limited and its Subsidiaries taken
as a whole and (ii) to enter into and perform its obligations under each
Loan Document, if any, to which it is a party.
SECTION 3.2. Due Authorization, Non-Contravention, etc. The
execution, delivery and performance by ADT Limited of this Guaranty and
each other Loan Document executed or to be executed by it, and the
execution, delivery and performance by each other Obligor of each Loan
Document executed or to be executed by it, are within ADT Limited's and
each such Obligor's corporate powers, have been duly authorized by all
necessary corporate action, and do not
(a) contravene ADT Limited's or any such Obligor's Organic
Documents;
(b) contravene any contractual restriction, law or governmental
regulation or court decree or order binding on or affecting ADT
Limited or any such Obligor (including the Companies Xxx 0000 of
Bermuda) in any manner that could reasonably be expected (i) to have
a material adverse effect on the business, results of operations,
financial condition or prospects of ADT Limited and its Subsidiaries
taken as a whole, (ii) to impair the ability of any Lender, Issuer
or Agent to enforce the Obligations or (iii) to subject any Lender,
Issuer or Agent to any liability; or
(c) result in, or require the creation or imposition of, any
Lien on any of ADT Limited's or any Obligor's properties.
SECTION 3.3. Government Approval, Regulation, etc. No
authorization or approval or other action by, and no notice to or filing
with, any governmental authority or regulatory body or other Person is
required for the due execution, delivery or performance by ADT Limited or
any other Obligor of this Guaranty or any other Loan Document to which it
is a party. Neither ADT Limited nor any other Obligor is an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended, or a "holding company", or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company", within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
SECTION 3.4. Validity, etc. This Guaranty constitutes, and each
other Loan Document executed by ADT Limited will, on the due execution and
delivery thereof, constitute, the legal, valid and binding obligations of
ADT Limited enforceable in accordance with their respective terms, subject
to applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws from time to time in effect affecting creditors' rights generally and
to general principles of equity; and each Loan Document executed pursuant
hereto by each other Obligor will, on the due execution and delivery
thereof by such Obligor, be the legal, valid and binding obligation of such
Obligor enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws from
time to time in effect affecting creditors' rights generally and to general
principles of equity.
SECTION 3.5. Financial Information. The financial statements set
forth in the 10-K of ADT Limited for the 1995 Fiscal Year and in the 10-Qs
of ADT Limited for the first three Fiscal Quarters of the 1996 Fiscal Year
and all financial statements of ADT Limited and its Subsidiaries furnished
to the Agent and the Lenders pursuant to clauses (a) and (d) of Section
8.1.1 of the Credit Agreement have, in each case, been prepared in
accordance with GAAP consistently applied, and present fairly the
consolidated financial condition of the corporations covered thereby, as at
the dates thereof, and the results of their operations for the periods then
ended.
SECTION 3.6. No Material Adverse Change. Since December 31, 1995,
there has been no material adverse change in the business, results of
operations, financial condition or prospects of ADT Limited and its
Subsidiaries taken as a whole.
SECTION 3.7. Litigation, Labor Controversies, etc. There is no
pending or, to the knowledge of ADT Limited, threatened litigation, action,
proceeding, or labor controversy affecting ADT Limited or any of its
Subsidiaries, or any of their respective properties, businesses, assets or
revenues, which could reasonably be expected to materially adversely affect
the financial condition, results of operations, business or prospects of
ADT Limited and its Subsidiaries, taken as a whole (provided that no
representation is being made with respect to the effect on such financial
condition, results of operations, business or prospects of any litigation,
action or proceeding described in the first two paragraphs under the
caption "Certain Litigation Against the Company" in the Preliminary Proxy
Statement of ADT Limited filed with the Securities and Exchange Commission
on January 8, 1997, provided to the Agent prior to the date hereof,
including any amendment to the complaint referred to therein provided to
the Agent prior to the Closing Date relating to the scheduling of the
special meeting of ADT Limited's shareholders referred to in any such
amendment), or which purports to affect the legality, validity or
enforceability of this Guaranty, or any other Loan Document, except as
disclosed in Item 3.7 ("Litigation") of the Disclosure Schedule.
SECTION 3.8. Subsidiaries. ADT Limited has no Subsidiaries, except
those Subsidiaries
(a) which are identified in Item 3.8 ("Existing Subsidiaries")
of the Disclosure Schedule; or
(b) which are permitted to have been created or acquired in
accordance with Section 4.2.5 or 4.2.9.
Without limiting any term or provision hereof, to the extent any Person
becomes a Subsidiary of ADT Limited in accordance with (and not in
contravention of) any term or provision hereof or of any other Loan
Document, ADT Limited may supplement such Item 3.8 of the Disclosure
Schedule to include such new Subsidiary by delivering a certificate, signed
by an Authorized Officer, certifying (i) as to the name and place of
organization of such new Subsidiary, (ii) as to the method by which such
new Subsidiary was created and (iii) that such new Subsidiary was created
without contravening any term or provision hereof or of any other Loan
Document.
SECTION 3.9. Ownership of Properties. ADT Limited and each of its
Subsidiaries owns good and marketable title to, or valid leases of, all of
its properties and assets necessary to conduct its business substantially
as currently conducted by it.
SECTION 3.10. Taxes. ADT Limited and each of its Subsidiaries, and
each other Obligor, has filed all material tax returns and reports required
by law to have been filed by it and has paid all material taxes and
governmental charges thereby shown to be owing, except any such taxes or
charges which are being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall
have been set aside on its books.
SECTION 3.11. Pension and Welfare Plans. During the twelve-
consecutive-month period prior to the date of the execution and delivery of
the Credit Agreement and prior to the date of any Credit Extension
thereunder, no steps have been taken to terminate any Pension Plan which
termination could result in the incurrence by ADT Limited or any member of
the Controlled Group of any material liability, and no contribution failure
has occurred with respect to any Pension Plan sufficient to give rise to a
Lien under section 302(f) of ERISA. No condition exists or event or
transaction has occurred with respect to any Pension Plan which might
result in the incurrence by ADT Limited or any member of the Controlled
Group of any material liability, fine or penalty. Except as disclosed in
Item 3.11 ("Employee Benefit Plans") of the Disclosure Schedule, neither
ADT Limited nor any member of the Controlled Group has any material
contingent liability with respect to any post-retirement benefit under a
Welfare Plan, other than liability for continuation coverage described in
Part 6 of Title I of ERISA.
SECTION 3.12. Environmental Warranties. Except as set forth in
Item 3.12 ("Environmental Matters") of the Disclosure Schedule,
(a) all facilities and property (including underlying
groundwater) owned or leased by ADT Limited or any of its
Subsidiaries have been, and continue to be, owned or leased by ADT
Limited and its Subsidiaries in material compliance with all
Environmental Laws;
(b) there have been no past, and there are no pending or
threatened
(i) claims, complaints, notices or requests for information
received by ADT Limited or any of its Subsidiaries with respect
to any alleged violation of any Environmental Law, which could
reasonably be expected to have a material adverse effect on the
business, results of operations, financial condition or
prospects of ADT Limited and its Subsidiaries or the Borrower
and its Subsidiaries, or
(ii) complaints, notices or inquiries to ADT Limited or any
of its Subsidiaries regarding potential liability under any
Environmental Law, which could reasonably be expected to have a
material adverse effect on the business, results of operations,
financial condition or prospects of ADT Limited and its
Subsidiaries or the Borrower and its Subsidiaries;
(c) there have been no Releases of Hazardous Materials at, on or
under any property now or previously owned or leased by ADT Limited
or any of its Subsidiaries that, singly or in the aggregate, have,
or may reasonably be expected to have, a material adverse effect on
the business, results of operations, financial condition or
prospects of ADT Limited and its Subsidiaries or the Borrower and
its Subsidiaries;
(d) ADT Limited and its Subsidiaries have been issued and are
in compliance with all permits, certificates, approvals, licenses
and other authorizations relating to environmental matters and
necessary for their businesses, except where the failure to have
been issued any such permit, certificate, approval, license or other
authorization or to have complied with any of the foregoing would
not, singly or in the aggregate, reasonably be expected to have a
material adverse effect on the business, results of operations,
financial condition or prospects of ADT Limited and its Subsidiaries
or the Borrower and its Subsidiaries;
(e) no property now or previously owned or leased by ADT Limited
or any of its Subsidiaries is listed or proposed for listing (with
respect to owned property only) on the National Priorities List
pursuant to CERCLA, on the CERCLIS or on any similar state list of
sites requiring investigation or clean-up that is reasonably likely
to lead to material claims against ADT Limited or such Subsidiary
thereof for any remedial work, damage to natural resources or
personal injury, including claims under CERCLA;
(f) there are no underground storage tanks, active or abandoned,
including petroleum storage tanks, on or under any property now or
previously owned or leased by ADT Limited or any of its Subsidiaries
that, singly or in the aggregate, have, or may reasonably be
expected to have, a material adverse effect on the business, results
of operations, financial condition or prospects of ADT Limited and
its Subsidiaries or the Borrower and its Subsidiaries;
(g) neither ADT Limited nor any Subsidiary of ADT Limited has
directly transported or directly arranged for the transportation of
any Hazardous Material to any location which is listed or proposed
for listing on the National Priorities List pursuant to CERCLA, on
the CERCLIS or on any similar state list or which is the subject of
federal, state or local enforcement actions or other investigations
which is reasonably likely to lead to material claims against ADT
Limited or such Subsidiary thereof for any remedial work, damage to
natural resources or personal injury, including claims under CERCLA;
(h) there are no polychlorinated biphenyls or friable asbestos
present at any property now or previously owned or leased by ADT
Limited or any Subsidiary of ADT Limited that, singly or in the
aggregate, have, or may reasonably be expected to have, a material
adverse effect on the business, results of operations, financial
condition or prospects of ADT Limited and its Subsidiaries or the
Borrower and its Subsidiaries; and
(i) no conditions exist at, on or under any property now owned
or leased (or, to the best knowledge of ADT Limited and its
Subsidiaries after due inquiry, any property previously owned or
leased) by ADT Limited or any Subsidiary of ADT Limited which would
give rise to liability under any Environmental Law or for personal
injury or property or other damage, which liability could reasonably
be expected to have a material adverse effect on the business,
results of operations, financial condition or prospects of ADT
Limited and its Subsidiaries or the Borrower and its Subsidiaries.
SECTION 3.13. Regulations G, U and X. Neither ADT Limited nor any
Subsidiary of ADT Limited is engaged in the business of extending credit
for the purpose of purchasing or carrying margin stock, and no proceeds of
any Loans will be used for a purpose which violates, or would be
inconsistent with, F.R.S. Board Regulation G, U or X. Terms for which
meanings are provided in F.R.S. Board Regulation G, U or X or any
regulations substituted therefor, as from time to time in effect, are used
in this Section with such meanings.
SECTION 3.14. No Defaults. Neither ADT Limited nor any Subsidiary
of ADT Limited is in violation of, or in default under, any term or
provision of its Organic Documents or any contract, agreement, indenture,
instrument, law, governmental regulation or court decree or order
applicable to it, such that such violations or defaults in the aggregate
would reasonably be expected to have a material adverse effect on the
business, results of operations, financial condition or prospects of ADT
Limited and its Subsidiaries, taken as a whole.
SECTION 3.15. Delivery of Organizational Chart. The Agent has been
furnished on or prior to the Effective Date a detailed organizational chart
of ADT Limited and all its Subsidiaries (other than Non-Guarantors
identified in Item 3.15 ("Existing Subsidiaries") of the Disclosure
Schedule that do not conduct any business activities and that do not have
assets with a Fair Market Value in excess of $10,000), certified by the
chief financial Authorized Officer of ADT Limited. Such chart indicates
each Subsidiary of ADT Limited that is or is required to be a Subsidiary
Guarantor as of the Effective Date and indicates with respect to each such
Subsidiary Guarantor that is a Material Subsidiary, its respective
percentages of consolidated gross revenues and consolidated gross assets of
the Borrower and its Subsidiaries for the 1995 Fiscal Year.
SECTION 3.16. Accuracy of Information. (a) All information (other
than financial projections) taken as a whole, prepared by ADT Limited, any
Subsidiary of ADT Limited or any other Obligor, or any Affiliate of any
such Person, or heretofore or contemporaneously furnished by or on behalf
of ADT Limited, any Subsidiary of ADT Limited or any other Obligor, or any
Affiliate of any such Person, in writing to any Agent or any Lender for
purposes of or in connection with this Guaranty, the Credit Agreement or
any other Loan Document or any transaction contemplated hereby or thereby
(including in connection with the Existing Credit Facility and each Loan
Document referred to therein) is, and all other such information (other
than financial projections) taken as a whole, hereafter furnished by or on
behalf of ADT Limited, any Subsidiary of ADT Limited or any other Obligor,
or any Affiliate of any such Person, to any Agent or any Lender will be,
true, complete and accurate in every material respect on the date as of
which such information is dated or certified and as of the date of
execution and delivery of the Credit Agreement by such Agent and such
Lender (it being acknowledged that, with respect to any specific financial
statement included in such information, such financial statement shall have
been true, complete and accurate in every material respect on the date or
for the period expressly set forth therein and not necessarily on any other
date or for any other period), and such information taken as a whole does
not and will not contain any untrue statement of a material fact and is
not, or shall not be, as the case may be, incomplete by omitting to state
any material fact necessary to make such information not misleading, and
(b) all financial projections heretofore or contemporaneously furnished by
or on behalf of ADT Limited, any Subsidiary of ADT Limited or any other
Obligor, or any Affiliate of any such Person, to any Agent or any Lender,
have been, and all such financial projections hereafter furnished by or on
behalf of ADT Limited, any Subsidiary of ADT Limited or any other Obligor,
or any Affiliate of any such Person, to the Agent or any Lender shall be,
prepared in good faith based upon reasonable assumptions.
SECTION 3.17. Restricted Payment Basket Amount; Equity Proceeds
Amount. As of September 30, 1996, the Restricted Payment Basket Amount was
not greater than $135,000,000 and, as of December 31, 1996, the Equity
Proceeds Amount was not greater than $54,000,000.
SECTION 3.18. Restricted Borrower Distributions. As of September
30, 1996, the amount available for Restricted Borrower Distributions was
not greater than $38,000,000.
ARTICLE IV
COVENANTS, ETC.
SECTION 4.1. Affirmative Covenants. ADT Limited covenants and
agrees that, until the Covenant Termination Date, ADT Limited will, unless
the Required Lenders shall otherwise consent in writing, perform and
observe the obligations set forth in this Section.
SECTION 4.1.1. Compliance with Laws, etc. ADT Limited will, and
will cause each of its Subsidiaries to, comply in all material respects
with all applicable laws, rules, regulations and orders, such compliance to
include (without limitation):
(a) except to the extent permitted under Section 4.2.9, the
maintenance and preservation by ADT Limited and each of its
Subsidiaries that is an Obligor or a Material Related Party of its
corporate existence and qualification as a foreign corporation in
each jurisdiction where the nature of its business or the location
of its assets requires it to be so qualified, except to the extent
the failure to maintain and preserve its corporate existence or to
be so qualified could not reasonably be expected to have a material
adverse effect on the business, results of operations, financial
condition or prospects of ADT Limited and its Subsidiaries (it being
acknowledged that the failure of ADT Limited or the Borrower to
maintain and preserve its corporate existence (except as permitted
under Section 4.2.9) shall be deemed to have such a material adverse
effect); and
(b) the payment, before the same become delinquent, of all
material taxes, assessments and governmental charges imposed upon it
or upon its property except to the extent being diligently contested
in good faith by appropriate proceedings and for which adequate
reserves in accordance with GAAP shall have been set aside on its
books.
SECTION 4.1.2. Maintenance of Properties. ADT Limited will, and
will cause each of its Subsidiaries to, maintain, preserve, protect and
keep its material properties in good repair, working order and condition,
and make necessary and proper repairs, renewals and replacements so that
its business carried on in connection therewith may be properly conducted
at all times unless ADT Limited determines in good faith that the continued
maintenance of any of its properties is no longer economically desirable.
SECTION 4.1.3. Insurance. ADT Limited will, and will cause each of
its Subsidiaries to, maintain or cause to be maintained with responsible
insurance companies insurance with respect to its properties and business
(including business interruption insurance) against such casualties and
contingencies and of such types and in such amounts as is customary in the
case of similar businesses and will, upon request of the Agent, furnish to
each Lender at reasonable intervals a certificate of an Authorized Officer
of ADT Limited setting forth the nature and extent of all insurance
maintained by ADT Limited and its Subsidiaries in accordance with this
Section.
SECTION 4.1.4. Books and Records. ADT Limited will, and will cause
each of its Subsidiaries to, keep books and records which accurately
reflect all of its business affairs and transactions and permit the Agent
or any of its representatives, at reasonable times and intervals (but not
more often than once per Fiscal Quarter, unless an Event of Default shall
have occurred and be continuing (in which case, and during such period,
each Lender shall have the rights of the Agent under this Section)) to
visit all of its offices, to discuss its financial matters with its
officers and independent public accountant (provided a representative of
ADT Limited or such Subsidiary is given prior notice of, and the
opportunity to be present during, such discussion) and, subject to
appropriate agreements of confidentiality and to any restrictions imposed
under applicable law (including regulations promulgated by the United
States Department of Defense), to examine any of its books or other
corporate records. ADT Limited shall pay any fees of such independent
public accountant incurred in connection with the Agent's or any Lender's
exercise of its rights pursuant to this Section. In addition, ADT Limited
shall pay the reasonable out-of-pocket expenses arising from the Agent's
visit to the offices of ADT Limited or any of its Subsidiaries in
connection with the exercise of its rights pursuant to this Section to the
extent of one such visit per Fiscal Year.
SECTION 4.1.5. Environmental Covenant. ADT Limited will, and will
cause each of its Subsidiaries to,
(a) use and operate all of its facilities and properties in
material compliance with all Environmental Laws, apply for and keep
all necessary permits, approvals, certificates, licenses and other
authorizations relating to environmental matters in effect where the
failure to so keep in effect could reasonably be expected to have a
material adverse effect on the business, results of operations,
financial condition or prospects of ADT Limited and its Subsidiaries
or the Borrower and its Subsidiaries and remain in material
compliance therewith, and handle all Hazardous Materials in material
compliance with all applicable Environmental Laws and in a manner so
as to minimize potential liability;
(b) immediately notify the Agent and provide copies upon receipt
of all written claims, complaints, notices or inquiries relating to
the condition of its facilities and properties or compliance with
Environmental Laws, which claims or other alleged conditions could
reasonably be expected to have a material adverse effect on the
business, results of operations, financial condition or prospects of
ADT Limited and its Subsidiaries or the Borrower and its
Subsidiaries; and
(c) provide such information and certifications which the Agent
may reasonably request from time to time to evidence compliance with
this Section 4.1.5.
SECTION 4.1.6. Guaranty Supplements. ADT Limited will cause each
Material Subsidiary and each Subsidiary subject to a Senior Note Guarantee
to be a Guarantor. In furtherance of the foregoing, ADT Limited will, in
the event any Person becomes a Material Subsidiary, notify the Agent of
such event or condition and will cause such new Material Subsidiary to
execute and deliver to the Agent as soon as practicable (but in no event
later than thirty days after the occurrence of such event or condition) a
Subsidiary Guarantor Guaranty Supplement, together with such certificates
and legal opinions as the Agent may reasonably request.
SECTION 4.1.7. Maintenance of Adequate Guarantees. If at any time
the Subsidiary Guarantors subject to the obligations of the Subsidiary
Guarantor Guaranty do not account on a consolidated basis for at least 90%
of the consolidated gross revenues of the Borrower and its Subsidiaries and
at least 90% of the consolidated gross assets of the Borrower and its
Subsidiaries (collectively, the "90% Test"), as reflected in the
consolidated statement of income and consolidated balance sheet most
recently delivered, or required to be delivered, pursuant to Section
8.1.1(a) or 8.1.1(d) of the Credit Agreement, ADT Limited will cause such
Non-Guarantors organized under the laws of the United States (or any state
thereof or the District of Columbia) as are necessary to meet the 90% Test
to execute and deliver to the Agent as soon as practicable (but in no event
later than thirty days after the occurrence of such event or condition) a
Subsidiary Guarantor Guaranty Supplement, together with such certificates
and legal opinions as the Agent may reasonably request.
SECTION 4.2. Negative Covenants. ADT Limited covenants and agrees
that, until the Covenant Termination Date, ADT Limited will not, without
the prior written consent of the Required Lenders, do anything prohibited
in this Section.
SECTION 4.2.1. Business Activities. ADT Limited will not, and will
not permit any of its Subsidiaries to, engage in any business activity,
except for those activities conducted in respect of the Core Businesses and
the businesses identified in Item 4.2.1 ("Permitted Existing Business
Activities") of the Disclosure Schedule, and such activities as may be
incidental or related thereto; provided, however, that ADT Limited will not
be in default in the observance of this Section 4.2.1 if, as part of the
acquisition of a Core Business, ADT Limited or its applicable Subsidiary
acquires a business or assets that would not constitute, or be included in,
a Core Business, so long as (i) the primary purpose of such acquisition was
the acquisition of such Core Business, which acquisition could not have
been consummated on as commercially attractive terms without the
acquisition of such other business or assets, (ii) not less than 70% of the
assets acquired pursuant to such acquisition related at the time of such
acquisition to such Core Business, (iii) ADT Limited or such applicable
Subsidiary is diligently pursuing the sale of such other business or assets
and (iv) such business or assets do not have, and could not reasonably be
expected to have, a material adverse effect on the business, results of
operations, financial condition or operations of ADT Limited and its
Subsidiaries taken as a whole.
SECTION 4.2.2. Indebtedness. ADT Limited will not, and will not
permit any of its Subsidiaries (other than the Borrower and its
Subsidiaries) to, create, incur, assume or suffer to exist or otherwise
become or be liable in respect of any Indebtedness, other than, without
duplication, the following:
(a) Indebtedness in respect of the Obligations hereunder;
(b) Indebtedness in respect of the Senior Note Guarantees, the
Senior Subordinated Note Guarantees and the XXXXx Guarantee to the
extent the guarantor under any such Senior Note Guarantee, Senior
Subordinated Note Guarantee or XXXXx Guarantee is subject to a
Guarantee that is in full force and effect with respect to
Indebtedness in respect of the Obligations;
(c) Indebtedness existing as of June 30, 1995; provided that
(i) such Indebtedness having a principal amount in excess of
$3,000,000 is identified in Item 4.2.2(c) ("Ongoing Indebtedness")
of the Disclosure Schedule and (ii) true and correct copies of any
indenture or agreement governing such Indebtedness having a
principal amount in excess of $10,000,000 have been provided to the
Agent;
(d) (i) Indebtedness of ADT Canada, Inc., a Wholly Owned
Subsidiary of ADT Limited organized under the laws of Ontario,
incurred for working capital purposes in an aggregate amount not to
exceed at any time outstanding Canadian $75,000,000 and guarantees
thereof by ADT Limited or any of its Subsidiaries and (ii)
Indebtedness of ADT Finance plc, a Wholly Owned Subsidiary of ADT
Limited organized under the laws of England, in an aggregate amount
not to exceed at any time outstanding Pound Sterling90,000,000 and
guarantees thereof by ADT Limited, ADT (UK) Holdings Limited, each
Subsidiary of ADT (UK) Holdings Limited and each other Subsidiary
of ADT Limited (other than an Intermediate Parent Company, the
Borrower, any Subsidiary of the Borrower or any other Subsidiary of
ADT Limited which conducts the major portion of its business in the
United States or substantially all of the property or assets of
which are located in the United States) (the agreements governing
the Indebtedness and guarantees described in this subclause (ii)
being herein collectively referred to as the "U.K. Credit
Facility");
(e) obligations of ADT Limited or any of its Subsidiaries
pursuant to Hedging Arrangements designed to protect ADT Limited or
any of its Subsidiaries against fluctuations in interest rates in
respect of Indebtedness of ADT Limited or such Subsidiary and not
entered into for purposes of speculation;
(f) obligations of ADT Limited or any of its Subsidiaries
pursuant to Hedging Arrangements designed to protect ADT Limited or
any of its Subsidiaries against fluctuations in currency values and
entered into in the ordinary course of business and not for purposes
of speculation;
(g) unsecured Indebtedness incurred in the ordinary course of
business (including open accounts extended by suppliers on normal
trade terms in connection with purchases of goods and services, but
excluding Indebtedness incurred through the borrowing of money or
Contingent Liabilities in respect of obligations of Persons other
than ADT Limited or any of its Subsidiaries);
(h) Indebtedness in respect of Capitalized Lease Liabilities
and Indebtedness ("Capex Indebtedness") incurred to finance the
construction or acquisition of assets permitted to be acquired or
constructed pursuant to Section 4.2.7, to the extent a Capitalized
Lease Liability (assuming for the purposes of this clause only that
Capex Indebtedness constitutes a Capitalized Lease Liability) could
have been incurred under Section 4.2.7;
(i) Indebtedness of Subsidiaries of ADT Limited owing to ADT
Limited;
(j) Indebtedness of Wholly Owned Subsidiaries of ADT Limited
owing to Wholly Owned Subsidiaries of ADT Limited (other than the
Borrower and the Subsidiary Guarantors);
(k) Indebtedness of Wholly Owned Subsidiaries of ADT Limited
(other than the Intermediate Parent Companies) owing to the Borrower
or any Subsidiary Guarantor in an aggregate amount not to exceed at
any time outstanding $175,000,000;
(l) Indebtedness of ADT Limited owing to Wholly Owned
Subsidiaries of ADT Limited in an aggregate amount not to exceed at
any time outstanding $75,000,000;
(m) Indebtedness consisting of guarantees, surety or
performance bonds or obligations in respect of purchase price
adjustments in connection with the acquisition or disposition of
assets;
(n) Indebtedness in respect of surety bonds and performance
bonds provided in the ordinary course of business;
(o) Indebtedness which refinances Indebtedness permitted by
clauses (b), (c), (d) and (h) above; provided, however, that after
giving effect to such refinancing, (i) the principal amount of
outstanding Indebtedness is not increased, (ii) in the case of
clauses (b) and (c) above, neither the tenor nor the average life
thereof is reduced, (iii) the respective obligor or obligors shall
be the same on the refinancing Indebtedness as on the Indebtedness
being refinanced, (iv) except in the case of clause (d)(ii) above,
the security for the refinancing Indebtedness shall be the same as
that for the Indebtedness being refinanced (except to the extent
that less security is granted to holders of refinancing
Indebtedness), (v) the holders of refinancing Indebtedness are not
afforded covenants, defaults, rights or remedies more burdensome to
the obligor or obligors than those contained in the Indebtedness
being refinanced and (vi) the refinancing Indebtedness is
subordinated to the same degree as the Indebtedness being
refinanced;
(p) Indebtedness in respect of the Preference Shares and
Exchangeable Preference Shares outstanding on the Existing Credit
Facility Effective Date; and
(q) other Indebtedness of ADT Limited and its Subsidiaries to
the extent that the amount of such Indebtedness outstanding at any
time, when added (without duplication) to the aggregate amount of
Indebtedness outstanding at such time under clause (s) of Section
8.2.2 of the Credit Agreement, does not exceed $75,000,000;
provided, however, that (i) no Indebtedness otherwise permitted by clauses
(i), (k) and (q) shall be permitted if, after giving effect to the
incurrence thereof, any Event of Default shall have occurred and be
continuing and (ii) no Indebtedness permitted by clause (i) or (k) shall be
permitted unless evidenced by promissory notes or other written loan
documents that provide that the Indebtedness evidenced thereby may not be
forgiven or satisfied for any consideration other than payment in full in
cash at par.
SECTION 4.2.3. Liens. ADT Limited will not, and will not permit
any of its Subsidiaries to, create, incur, assume or suffer to exist any
Lien upon any of its property, revenues or assets (including Capital Stock
of Subsidiaries of ADT Limited), whether now owned or hereafter acquired,
except:
(a) Liens securing payment of the Obligations, granted pursuant
to any Loan Document;
(b) Liens granted prior to the Existing Credit Facility
Effective Date to secure payment of Indebtedness of the type
permitted and described in clause (c) of Section 4.2.2 and clause
(f) of Section 8.2.2 of the Credit Agreement and Liens securing
refinancings thereof permitted by clause (o) of Section 4.2.2 and
clause (r) of Section 8.2.2 of the Credit Agreement, respectively;
(c) (i) Liens granted to secure payment of Indebtedness of the
type permitted and described in clause (h) of Section 4.2.2 and
clause (k) of Section 8.2.2 of the Credit Agreement and covering
only those assets acquired with the proceeds of such Indebtedness
and Liens with respect to such assets securing refinancings of such
Indebtedness permitted by clause (o) of Section 4.2.2 and clause (r)
of Section 8.2.2 of the Credit Agreement, respectively and (ii)
Liens granted to secure obligations under the U.K. Credit Facility
and covering only assets of the obligors and guarantors thereunder
and Liens with respect to such assets securing refinancings of such
Indebtedness permitted by clause (o) of Section 4.2.2;
(d) Liens for taxes, assessments or other governmental charges
or levies not at the time delinquent or thereafter payable without
penalty or being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP
shall have been set aside on its books;
(e) Liens of carriers, warehousemen, mechanics, materialmen and
landlords incurred in the ordinary course of business for sums not
overdue or being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP
shall have been set aside on its books;
(f) Liens incurred in the ordinary course of business in
connection with workmen's compensation, unemployment insurance or
other forms of governmental insurance or benefits, or to secure
performance of tenders, statutory obligations, leases and contracts
(other than for borrowed money) entered into in the ordinary course
of business or to secure obligations on surety or appeal bonds;
(g) judgment Liens (i) in an aggregate amount not in excess of
$15,000,000, (ii) as to which enforcement proceedings shall not have
commenced and there shall not have been a period of 30 consecutive
days during which such judgment was not stayed or (iii) the payment
of which is covered in full (subject to a customary deductible) by
insurance maintained with responsible insurance companies;
(h) Liens with respect to assets of a Subsidiary of ADT Limited
(other than the Borrower) granted to secure Indebtedness owing to
the Borrower or a Wholly Owned Subsidiary of the Borrower that is a
Guarantor;
(i) Liens with respect to assets of a Subsidiary of ADT Limited
(other than the Borrower or any of its Subsidiaries or an
Intermediate Parent Company) granted to secure Indebtedness owing to
ADT Limited or a Wholly Owned Subsidiary of ADT Limited;
(j) Liens (i) existing at the time that a Person becomes a
Subsidiary of ADT Limited in a transaction permitted hereunder or
(ii) assumed in connection with an acquisition of assets permitted
hereunder; provided, however, that any such Lien covers only assets
that were subject to such Lien prior to the related transaction and
was not created, assumed or incurred in contemplation of such
transaction;
(k) easements, rights-of-way, restrictions and other similar
charges or encumbrances not interfering in any material respect with
the business of ADT Limited or any of its Subsidiaries and incurred
in the ordinary course of business;
(l) the Lien inherent in the right of any bank to set off
deposits against debts owed to such bank;
(m) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of customs duties in connection
with the importation of goods;
(n) Liens arising by operation of law incurred in the ordinary
course of business and which Liens, singly or in the aggregate, do
not interfere in any material respect with the business of ADT
Limited or any of its Subsidiaries; and
(o) other Liens securing Indebtedness in an aggregate amount not
to exceed $15,000,000 at any time outstanding.
SECTION 4.2.4. Financial Condition. ADT Limited will not permit:
(a) its Stockholders' Equity to be at any time less than the
sum, at such time, of (i) $1,134,300,000 plus (ii) 50% of the Net
Income of ADT Limited for each Fiscal Year commencing with the 1995
Fiscal Year (less, for each such Fiscal Year, cash dividends on
Preference Shares to the extent permitted hereunder) as shall have
been completed on or prior to such time (in each case with no
reduction for net losses, if any, for such Fiscal Year);
(b) its Cash Flow Coverage Ratio, as at the end of any Fiscal
Quarter, to be less than 1.5 to 1.0;
(c) its Debt to Total Capitalization Ratio, as at the end of any
Fiscal Quarter, to be greater than 0.5 to 1.0.
SECTION 4.2.5. Investments. ADT Limited will not, and will not
permit any of its Subsidiaries to, make, incur, assume or suffer to exist
any Investment in any other Person, except:
(a) (i) Investments existing on June 30, 1995 and identified
in Item 4.2.5(a) ("Ongoing Investments") of the Disclosure Schedule
and (ii) Investments acquired in the ASH Transaction (including the
sale of such Investments by ADT Limited to ADT (UK) Holdings
Limited, the sale of certain of such Investments by ASH and its
Subsidiaries to the Borrower and its Subsidiaries and the sale by
ADT Business Holdings, Inc. to Sonitrol Management Corp. of all of
the Capital Stock of Mid-Atlantic Security, Inc., in each case prior
to the date hereof);
(b) Cash Equivalent Investments and High Quality Investments;
(c) without duplication, Investments permitted as Indebtedness
pursuant to Section 4.2.2 or Section 8.2.2 of the Credit Agreement;
(d) without duplication, Investments permitted as Capital
Expenditures pursuant to Section 4.2.7;
(e) Investments by way of contributions to capital by ADT
Limited or any of its Subsidiaries to any Wholly Owned Subsidiary of
ADT Limited to the extent the Person making such Investment would be
allowed to make and maintain a loan or advance to such Wholly Owned
Subsidiary under Section 4.2.2 or Section 8.2.2 of the Credit
Agreement; provided that, solely for purposes of determining under
this Section 4.2.5 or Section 4.2.2 or under Section 8.2.2 of the
Credit Agreement whether such Person may make and maintain any such
loan or advance, the aggregate amount of Investments pursuant to
this clause (e) shall be taken into account as if such Investments
were a loan or advance;
(f) loans or advances to, or guarantees on behalf of, employees
of ADT Limited or any of its Subsidiaries made in the ordinary
course of business not to exceed at any time $500,000 per employee
or $5,000,000 in the aggregate for all such employees;
(g) Investments which are Permitted Business Acquisitions;
(h) accounts arising from sales of goods or services on trade
credit terms in the ordinary course of business of ADT Limited and
its Subsidiaries;
(i) negotiable instruments held for collection, lease, utility
and other similar deposits, or stock, obligations or securities
received in settlement of debts owing to ADT Limited or any of its
Subsidiaries as a result of a composition or readjustment of debt or
a reorganization of any debtor or ADT Limited or any of its
Subsidiaries or of foreclosure, perfection or enforcement of any
Lien, in each case as to debt that arose in the ordinary course of
business;
(j) Investments consisting of non-cash consideration received
in the sale or other disposition of assets or Capital Stock effected
in compliance with Section 4.2.10;
(k) (i) the exchange of Common Shares for Non-Voting
Exchangeable Shares (and payment of cash in lieu of fractional
shares) pursuant to the terms of Non-Voting Exchangeable Shares as
in effect on the Existing Credit Facility Effective Date and (ii)
the acquisition of Common Shares to the extent (A) the acquisition
of such Common Shares is not prohibited by any provision hereof or
of any other Loan Document (including Section 4.2.6(a)) and (B) the
aggregate number of Common Shares held by Subsidiaries of ADT
Limited does not exceed at any time nine percent of the Voting Stock
of ADT Limited outstanding at such time;
(l) the obligation of ADT Limited to exchange Common Shares for
XXXXx (and payment of cash in lieu of fractional shares) pursuant to
the terms of the XXXXx Indenture in effect on the Existing Credit
Facility Effective Date;
(m) Investments in any Wholly Owned Subsidiary of ADT Limited
that provides insurance in the ordinary course of business and on
reasonable terms solely to ADT Limited or any of its Subsidiaries
for the purpose of insuring ADT Limited or such Subsidiary against
liability that would not be covered by insurance policies required
to be maintained pursuant to Section 4.1.3 as a result of reasonable
and customary deductibles thereunder, to the extent such Investments
are necessary or appropriate to maintain such insurance;
(n) advances or loans made in connection with Hedging
Arrangements permitted hereunder or under the Credit Agreement; and
(o) other Investments of a type not otherwise permitted pursuant
to the immediately preceding clauses, including Investments in
Minority Interests and Related Businesses, to the extent the
aggregate amount of such Investments, when added (without
duplication) to the aggregate amount expended since the Existing
Credit Facility Effective Date in connection with Business
Acquisitions permitted under clause (f) of Section 4.2.9 (or clause
(f) of Section 4.2.9 of the ADT Limited Guaranty (as defined in the
Existing Credit Facility)), does not exceed at any one time
$25,000,000;
provided, however, that
(i) any Investment which when made complies with the
requirements of the definition of the term "Cash Equivalent
Investment" or "High Quality Investment", as the case may be, may
continue to be held notwithstanding that such Investment if made
thereafter would not comply with such requirements;
(ii) Investments made by the Borrower and the Subsidiary
Guarantors after the Existing Credit Facility Effective Date in
Subsidiaries of ADT Limited (other than the Borrower and the
Subsidiary Guarantors) may not exceed in the aggregate at any
time $175,000,000;
(iii) no Investment otherwise permitted by clause (g) shall
be permitted to be made if an Event of Default described in
Section 9.1.1, 9.1.3 (to the extent resulting from a default in
the observance of any obligation under Section 4.2.4 or Section
8.2.3 of the Credit Agreement), 9.1.5 or 9.1.9 of the Credit
Agreement shall have occurred and be continuing or would occur
upon giving effect thereto;
(iv) no Investment otherwise permitted by clause (e), (f),
(m) or (o) shall be permitted to be made if an Event of Default
shall have occurred and be continuing or would occur upon giving
effect thereto; and
(v) without limiting any of the restrictions set forth in
this Section 4.2.5, no Investment shall be permitted to be made
if such Investment would not be permitted by the terms of the
Senior Note Indenture.
SECTION 4.2.6. Restricted Payments, etc. (a) ADT Limited will
not, and will not permit any of its Subsidiaries to, directly or
indirectly,
(i) declare or pay any dividend on, or make any distribution
to holders of, any shares of Capital Stock of ADT Limited (other
than dividends or distributions payable in shares of Capital
Stock of ADT Limited or in rights, warrants or options to
purchase such Capital Stock, but excluding dividends or
distributions payable in Redeemable Capital Stock or in options,
warrants or other rights to purchase Redeemable Capital Stock,
provided that dividends on Redeemable Capital Stock may be paid
in shares of such Redeemable Capital Stock),
(ii) purchase, redeem, retire or otherwise acquire for value,
or make any payment on account of the purchase, redemption,
retirement or other acquisition for value of, any Capital Stock
of ADT Limited or any warrants, rights or options to purchase or
acquire any such Capital Stock, or
(iii) declare or pay any dividend on, or make any
distribution to holders of, any Capital Stock of any Subsidiary
of ADT Limited (other than (A) with respect to any such Capital
Stock held by ADT Limited or any of its Wholly Owned Subsidiaries
or (B) with respect to the Voting Stock of any Subsidiary, made
on a pro rata basis, consistent with the ownership interests in
such Voting Stock, to the owners of such Voting Stock) or
purchase, redeem or otherwise acquire or retire for value, or
make any payment on account of the purchase, redemption,
retirement or other acquisition for value of, any outstanding
Capital Stock of any Subsidiary of ADT Limited (other than any
such Capital Stock held by ADT Limited or any of its Wholly Owned
Subsidiaries) or any warrants, rights or options to purchase or
acquire any such outstanding Capital Stock
(such payments or any other actions described in (but not excluded from)
the foregoing clauses (i) thorough (iii) being herein referred to as
"Restricted Distributions"), unless such Restricted Distribution would be
permitted by the terms of the Senior Note Indenture as in effect on the
Existing Credit Facility Effective Date; provided, however, that
(x) no Restricted Distribution otherwise permitted pursuant
to this Section 4.2.6(a) (other than any exchange of shares of
the Capital Stock of BAA plc for Exchangeable Preference Shares
pursuant to the terms of the Bye-Laws of ADT Limited as in effect
on the Existing Credit Facility Effective Date, the payment of
any Restricted Distribution within 60 days after the date of
declaration thereof, if at such date of declaration such
declaration was permitted hereunder, and any exchange of shares
of Non-Voting Exchangeable Shares for Common Shares in accordance
with the terms of the Articles of Incorporation of ADT Finance
Inc. as in effect on the Existing Credit Facility Effective Date)
shall be permitted if an Event of Default (including a default in
the observance by the Borrower of its obligations under clause
(a) of Section 8.2.3 of the Credit Agreement) shall have occurred
and be continuing or would occur upon giving effect to such
Restricted Distribution; and
(y) no Restricted Distribution otherwise permitted pursuant
to this Section 4.2.6(a) shall be permitted if such Restricted
Distribution would, pursuant to the terms of the Senior Note
Indenture, decrease the Restricted Payment Basket Amount to an
amount which is less than the excess of (1) the sum of (A) the
aggregate amount expended on Permitted Business Acquisitions
(other than the ASH Transaction to the extent the aggregate
consideration therefor did not exceed $425,000,000) after the
Existing Credit Facility Effective Date in excess of the
applicable Annual Limits (or, during the effectiveness of the
Existing Credit Facility, the applicable Annual Limits (as
defined under the Existing Credit Facility)) and (B) the
aggregate amount of Capital Expenditures made after the Existing
Credit Facility Effective Date with the cash proceeds referred to
in clause (a) of the definition of Equity Proceeds Amount and
designated as such pursuant to the Compliance Certificate
(including any compliance certificate delivered under the
Existing Credit Facility) delivered in connection with the Fiscal
Quarter in which such Capital Expenditures were paid over (2) the
portion (if any) of such sum which resulted in a decrease of the
Restricted Payment Basket Amount.
(b) ADT Limited will not, and will not permit any of its
Subsidiaries to, directly or indirectly,
(i) declare or pay any dividend on, or make any distribution
to holders of, any shares of Capital Stock of the Borrower (other
than (A) dividends or distributions payable in shares of Capital
Stock of the Borrower or in rights, warrants or options to
purchase such Capital Stock, but excluding dividends or
distributions payable in Redeemable Capital Stock or in options,
warrants or other rights to purchase Redeemable Capital Stock,
provided that dividends on Redeemable Capital Stock may be paid
in shares of such Redeemable Capital Stock and (B) the dividend
of the Dividended Note), or
(ii) purchase, redeem, retire or otherwise acquire for value,
or make any payment on account of the purchase, redemption,
retirement or other acquisition for value of, any Capital Stock
of the Borrower or any warrants, rights or options to purchase or
acquire any such Capital Stock
(such payments or any other actions described in (but not excluded from)
the foregoing clauses (i) and (ii) being herein referred to as "Restricted
Borrower Distributions"), unless the amount of such Restricted Borrower
Distribution (which amount, in the case of a Restricted Borrower
Distribution to be made in property, shall equal the Fair Market Value
thereof (as determined, in the case of any property with an aggregate value
in excess of $15,000,000, in good faith by the Board of Directors of the
Borrower, whose determination shall be evidenced by a certified written
resolution of such Board)), when added to the aggregate amount of all such
Restricted Borrower Distributions declared since the Existing Credit
Facility Effective Date, would not exceed 50% of the aggregate Net Income
of the Borrower accrued on a cumulative basis during the period (taken as
one accounting period) from the Existing Credit Facility Effective Date to
the last day of the most recently completed Fiscal Quarter with respect to
which, pursuant to Section 8.1.1(a) or 8.1.1(d) of the Credit Agreement (or
Section 8.1.1(d) of the Existing Credit Facility), financial statements
have been delivered to the Agent on or prior to the date of the proposed
Restricted Borrower Distribution; provided, however, that no Restricted
Borrower Distribution otherwise permitted pursuant to this Section 4.2.6(b)
shall be permitted if an Event of Default (including a default in the
observance by the Borrower of its obligations under clause (a) of Section
8.2.3 of the Credit Agreement) shall have occurred and be continuing or
would occur upon giving effect to such Restricted Borrower Distribution.
(c) ADT Limited will not, and will not permit any of its
Subsidiaries to, directly or indirectly,
(i) make any payment of interest on the Senior Notes or any
Subordinated Debt (other than Subordinated Debt originally issued
to ADT Limited or a Wholly Owned Subsidiary of ADT Limited (or
otherwise acquired by ADT Limited or such Wholly-Owned
Subsidiary, to the extent that the consideration paid by ADT
Limited or a Wholly-Owned Subsidiary resulted in a decrease of
the Restricted Payment Basket Amount) and held by ADT Limited or
a Wholly Owned Subsidiary of ADT Limited) on any day other than
the date such payment is required to be made as set forth in the
Senior Notes, the Senior Note Indenture, the Senior Subordinated
Note Indenture, the XXXXx, the XXXXx Indenture or the other
documents and instruments memorializing such Subordinated Debt,
or which, in the case of any Subordinated Debt (including
Subordinated Debt held by ADT Limited or a Wholly Owned
Subsidiary of ADT Limited), would violate the subordination
provisions thereof; or
(ii) make any payment or prepayment of principal of, or
redeem, purchase, repurchase or defease, the Senior Notes or any
Subordinated Debt (other than Subordinated Debt originally issued
to ADT Limited or a Wholly Owned Subsidiary of ADT Limited (or
otherwise acquired by ADT Limited or such Wholly-Owned
Subsidiary, to the extent that the consideration paid by ADT
Limited or such Wholly-Owned Subsidiary resulted in a decrease of
the Restricted Payment Basket Amount) and held by ADT Limited or
a Wholly Owned Subsidiary of ADT Limited, except, prior to the
occurrence of a Permitted Auction Business Sale, Subordinated
Debt in respect of the Dividended Note) on any day other than the
date any such payment, prepayment, redemption or repurchase is
required to be made as set forth in Sections 1010 and 1016 of the
Senior Note Indenture, Sections 1010 and 1016 of the Senior
Subordinated Note Indenture, Section 3.09 of the XXXXx Indenture
or in the other documents and instruments memorializing the
Senior Notes or such Subordinated Debt, or which, in the case of
any Subordinated Debt (including Subordinated Debt held by ADT
Limited or a Wholly Owned Subsidiary of ADT Limited), would
violate the subordination provisions thereof; provided, however,
that ADT Limited and its Subsidiaries may, to the extent the
subordination provisions of the Senior Subordinated Note
Indenture, the XXXXx Indenture or any other document or
instrument memorializing Subordinated Debt would not be violated
thereby, make any payment or prepayment of principal of, or
redeem or repurchase, the Senior Notes or any Subordinated Debt
if permitted by the terms of the Senior Note Indenture; provided
further, however, that no payment, prepayment, redemption or
repurchase otherwise permitted pursuant to the immediately
preceding proviso shall be permitted if (x) an Event of Default
shall have occurred and be continuing or would occur upon giving
effect to such payment, prepayment, redemption or repurchase or
(y) such payment, prepayment, redemption or repurchase would,
pursuant to the terms of the Senior Note Indenture, decrease the
Restricted Payment Basket Amount to an amount which is less than
the excess of (1) the sum of (A) the aggregate amount expended on
Permitted Business Acquisitions (other than the ASH Transaction
to the extent the aggregate consideration therefor did not exceed
$425,000,000) after the Existing Credit Facility Effective Date
in excess of the applicable Annual Limits (or, during the
effectiveness of the Existing Credit Facility, the applicable
Annual Limits (as defined under the Existing Credit Facility))
and (B) the aggregate amount of Capital Expenditures made after
the Existing Credit Facility Effective Date with the cash
proceeds referred to in clause (a) of the definition of Equity
Proceeds Amount and designated as such pursuant to the Compliance
Certificate (including any compliance certificate delivered under
the Existing Credit Facility) delivered in connection with the
Fiscal Quarter in which such Capital Expenditures were paid over
(2) the portion (if any) of such aggregate amount which resulted
in a decrease of the Restricted Payment Basket Amount.
SECTION 4.2.7. Capital Expenditures, etc. ADT Limited will not,
and will not permit any of its Subsidiaries to, make Capital Expenditures,
except (i) Capital Expenditures in connection with conducting the Core
Businesses and (ii) Capital Expenditures incurred in respect of Business
Acquisitions permitted under Sections 4.2.5 and 4.2.9; provided, however,
that no Capitalized Lease Liabilities otherwise permitted to be incurred
pursuant to this Section shall be permitted to be incurred if the aggregate
amount of all such Capitalized Lease Liabilities incurred during any Fiscal
Year would exceed $30,000,000.
SECTION 4.2.8. [Intentionally Omitted.]
SECTION 4.2.9. Consolidation, Merger, etc. ADT Limited will not,
and will not permit any of its Subsidiaries to, liquidate or dissolve, or
amalgamate or consolidate with, or merge into or with, any other Person, or
otherwise enter into or consummate any Business Acquisition not
constituting an Investment, except
(a) any Subsidiary of ADT Limited that is a direct or indirect
parent of the Borrower may liquidate or dissolve voluntarily into,
and may amalgamate or consolidate with or merge into, ADT Limited or
any Wholly Owned Subsidiary of ADT Limited that is an indirect
parent of the Borrower, and any assets or Capital Stock of any
Subsidiary of ADT Limited that is an indirect parent of the Borrower
may be purchased or otherwise acquired by ADT Limited or any Wholly
Owned Subsidiary of ADT Limited that is an indirect parent of the
Borrower;
(b) any Subsidiary of the Borrower may liquidate or dissolve
voluntarily into, and may merge with or into, the Borrower or any
Wholly Owned Subsidiary of the Borrower, and any assets or Capital
Stock of any Subsidiary of the Borrower may be purchased or
otherwise acquired by the Borrower or any Wholly Owned Subsidiary of
the Borrower;
(c) any Non-Guarantor that is not a Subsidiary of the Borrower
may liquidate or dissolve voluntarily into, and may merge with or
into, ADT Limited or any Wholly Owned Subsidiary of ADT Limited, and
any assets or Capital Stock of any such Non-Guarantor may be
purchased or otherwise acquired by ADT Limited or any Wholly Owned
Subsidiary of ADT Limited;
(d) ADT Limited may (i) amalgamate with or merge with or into a
newly-formed corporation having no assets or liabilities, which
amalgamation or merger shall be solely for the purpose of
reincorporating ADT Limited under the laws of Canada or any
political subdivision thereof, the United Kingdom or any political
subdivision thereof or the United States of America, any state
thereof or the District of Columbia or (ii) continue, redomesticate
or otherwise become subject to the laws of a jurisdiction other than
Bermuda, to the same extent as if it had been incorporated in such
jurisdiction; provided, however, that in the case of clauses (i) and
(ii) above, (A) the surviving entity shall be a corporation duly
organized and validly existing under the laws of Canada or any
political subdivision thereof, the United Kingdom or any political
subdivision thereof or the United States of America, any state
thereof or the District of Columbia and shall, in either case,
expressly assume all the obligations of ADT Limited hereunder and
this Guaranty shall remain in full force and effect; (B)
immediately before and immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and
be continuing; (C) immediately after giving effect to such
transaction, Stockholders' Equity of the surviving entity is at
least equal to the Stockholders' Equity of ADT Limited immediately
before such transaction less customary and reasonable transaction
costs; (D) each Guarantor, unless it is the other party to the
transactions described above, shall have confirmed that its Guaranty
shall remain in full force and effect; and (E) the surviving entity
shall have delivered, or caused to be delivered, to the Lenders an
officers' certificate and an opinion of counsel, each stating that
this provision has been complied with and that all conditions
precedent herein provided for relating to such transaction have been
satisfied;
(e) ADT Limited or any Subsidiary of ADT Limited may enter into
or consummate any Permitted Business Acquisition; and
(f) ADT Limited or any Subsidiary of ADT Limited may enter into
or consummate any Business Acquisition of a Related Business to the
extent the aggregate amount of expenditures of ADT Limited and its
Subsidiaries in respect of such Business Acquisition, when added
(without duplication) to (i) the aggregate amount of all
expenditures of ADT Limited and its Subsidiaries in respect of
Business Acquisitions made pursuant to this clause (f) (or clause
(f) of Section 4.2.9 of the ADT Limited Guaranty (as defined in the
Existing Credit Facility)) since the Existing Credit Facility
Effective Date and (ii) the aggregate amount of Investments
outstanding under clause (o) of Section 4.2.5, does not exceed
$25,000,000.
SECTION 4.2.10. Asset Dispositions, etc. ADT Limited will not, and
will not permit any of its Subsidiaries to, sell, transfer, lease,
contribute or otherwise convey, or grant options, warrants or other rights
with respect to, all or any substantial part of its assets (including
accounts receivable, Capital Stock of Subsidiaries of ADT Limited and other
Investments) to any Person (an "Asset Sale"), unless
(a) such Asset Sale is permitted by Section 4.2.9; or
(b) such Asset Sale is a Permitted Strategic Sale or Permitted
Auction Business Sale; or
(c) with respect to assets other than the Capital Stock of the
Borrower and any Intermediate Parent Company
(i) such Asset Sale is in the ordinary course of business; or
(ii) (A) if such Asset Sale consists of the sale or transfer
of the Capital Stock of a Subsidiary of ADT Limited, all but not
less than all of the Capital Stock of such Subsidiary is so sold
or transferred, (B) such Asset Sale is for not less than the Fair
Market Value of the assets sold (as determined in good faith by
the Board of Directors of ADT Limited or a committee thereof,
whose determination shall be evidenced by a certified written
resolution of such Board or such committee) and the consideration
received by ADT Limited or the relevant Subsidiary in respect of
such Asset Sale (other than in connection with a sale or
disposition of the Capital Stock of Nu-Swift plc held by ADT
Limited on the Effective Date) consists of at least 75% cash
(including any cash proceeds received from the sale of securities
received in such Asset Sale, provided that at the time of such
Asset Sale, ADT Limited or the relevant Subsidiary has entered
into a legally binding agreement for the sale of such securities
and such securities are sold within sixty days of such Asset
Sale), or Cash Equivalent Investments and (C) the net book value
of such assets, together with the net book value of all other
assets subject to an Asset Sale permitted under this clause (ii)
(or clause (c)(ii) of Section 4.2.10 of the ADT Limited Guaranty
(as defined in the Existing Credit Facility)) since the Existing
Credit Facility Effective Date, does not exceed $130,000,000; or
(d) each party to such Asset Sale is either ADT Limited or a
Subsidiary of ADT Limited (other than the Borrower, any Subsidiary
Guarantor or any Intermediate Parent Company); or
(e) all parties to such Asset Sale are either the Borrower or a
Subsidiary Guarantor.
SECTION 4.2.11. Modification of Certain Documents. ADT Limited
will not, and will not permit any of its Subsidiaries to, consent to any
amendment, supplement or other modification of any of the terms or
provisions contained in, or applicable to, the Senior Notes, any
Subordinated Debt (including Subordinated Debt in respect of the Dividended
Note, but excluding other Subordinated Intercompany Debt), or any document
or instrument evidencing or applicable thereto (including the Senior Note
Indenture, the Senior Subordinated Note Indenture and the XXXXx Indenture),
other than any amendment, supplement or other modification which extends
the date or reduces the amount of any required repayment or redemption or
which does not adversely affect any of the Lender Parties.
SECTION 4.2.12. Transactions with Affiliates. ADT Limited will
not, and will not permit any of its Subsidiaries to, enter into, or cause,
suffer or permit to exist any arrangement or contract with any of its other
Affiliates unless such arrangement or contract is fair and equitable to ADT
Limited or such Subsidiary and is an arrangement or contract of the kind
which would be entered into by a prudent Person in the position of ADT
Limited or such Subsidiary with a Person which is not one of its
Affiliates; provided, however, that the foregoing restriction shall not
apply to (i) any arrangement or contract between or among ADT Limited, the
Borrower or any Guarantor that is a Wholly Owned Subsidiary of the Borrower
or (ii) any other arrangement expressly permitted hereunder.
SECTION 4.2.13. Negative Pledges, Restrictive Agreements, etc. ADT
Limited will not, and will not permit any of its Subsidiaries to, enter
into any agreement (excluding this Guaranty and any other Loan Document)
(a) prohibiting the creation or assumption of any Lien to secure
the Obligations upon its properties, revenues or assets, whether now
owned or hereafter acquired; or
(b) restricting the ability of any such Subsidiary to make any
payments, directly or indirectly, to ADT Limited by way of
dividends, advances, repayments of loans or advances, reimbursements
of management and other intercompany charges, expenses and accruals
or other returns on investments, or any other agreement or
arrangement which restricts the ability of any such Subsidiary to
make any payment, directly or indirectly, to ADT Limited;
except
(i) (A) any indenture or agreement governing Indebtedness
permitted by clause (b), (c) or (d)(i) of Section 4.2.2 or clause
(b), (c), (d), (e), (f) or (g) of Section 8.2.2 of the Credit
Agreement, as in effect on the Existing Credit Facility Effective
Date, (B) the U.K. Credit Facility to the extent that the U.K.
Credit Facility prohibits the creation or assumption of any Lien
which secures the Obligations on the property, revenues or assets
of ADT Limited and its Subsidiaries (other than the Borrower and
its Subsidiaries) or requires any obligor under the U.K. Credit
Facility to maintain a certain level of net worth and (C) any
refinancings of any of the foregoing permitted by clause (o) of
Section 4.2.2 or clause (r) of Section 8.2.2 of the Credit
Agreement;
(ii) any agreement governing any Indebtedness permitted by
clause (h) of Section 4.2.2 or clause (k) of Section 8.2.2 of the
Credit Agreement as to the assets financed with the proceeds of
such Indebtedness and any refinancings thereof permitted by
clause (o) of Section 4.2.2 or clause (r) of Section 8.2.2 of the
Credit Agreement;
(iii) any customary encumbrance or restriction with respect to
a Subsidiary of ADT Limited imposed pursuant to an agreement
entered into for a sale or disposition permitted hereunder of all
or substantially all of the Capital Stock or assets of such
Subsidiary, so long as such encumbrance or restriction, by its
terms, terminates on the earlier of the termination of such
agreement or the consummation of such agreement;
(iv) customary restrictions on transfers of property subject
to Liens permitted pursuant to Section 4.2.3;
(v) restrictions on transfers of property by reason of, or
existing under, (A) applicable law or (B) customary non-
assignment provisions of any agreement entered into by any
Subsidiary in the ordinary course of business or any lease
governing a leasehold interest of any Subsidiary entered into in
the ordinary course of business;
(vi) usual and customary restrictions pursuant to any
agreement relating to Indebtedness of any Foreign Subsidiary
permitted pursuant to Section 4.2.2 and incurred for working
capital purposes, which restrictions may include requirements for
the maintenance of net worth or other balance sheet conditions,
restrictions on mergers and transfers of assets, restrictions on
investments, restrictions on transactions with affiliates and
requirements to maintain specified levels of cash flow or cash
flow coverage ratios; provided that such restrictions are agreed
to in good faith and, where applicable, based upon reasonable
assumptions; and
(vii) restrictions contained in Indebtedness (A) existing at
the time a Person becomes a Subsidiary of ADT Limited in a
transaction permitted hereunder or (B) assumed in connection with
an acquisition of assets permitted hereunder; provided such
Indebtedness was not incurred and such restrictions were not
created in contemplation of any such transaction.
SECTION 4.2.14. Accounting Changes. ADT Limited will not, and will
not permit any of its Subsidiaries to, change its Fiscal Year from twelve
consecutive calendar months ending on December 31.
SECTION 4.2.15. Ability to Amend; Restrictive Agreements. ADT
Limited will not, and will not permit any of its Subsidiaries to, enter
into, or accept the obligations under, any agreement (i) prohibiting
(including, except with respect to (x) any agreement governing Indebtedness
permitted by clause (b) or (c) of Section 4.2.2 or clause (b), (c), (d),
(e), (f) or (g) of Section 8.2.2 of the Credit Agreement, as in effect on
the Existing Credit Facility Effective Date, or (y) any agreement governing
Indebtedness permitted under clause (o) of Section 4.2.2 or clause (r) of
Section 8.2.2 of the Credit Agreement that refinances Indebtedness referred
to in the preceding clause (x), subjecting to any condition) the ability of
ADT Limited or any of its Subsidiaries to amend or otherwise modify this
Guaranty or any other Loan Documents or (ii) containing any provision that
would contravene any provision of any Loan Document.
SECTION 4.2.16. [Intentionally Omitted.]
SECTION 4.2.17. Activities of Certain Subsidiaries. (a) ADT
Limited will not permit any of the Intermediate Parent Companies to engage
in any business activity or incur any obligation, except (i) the ownership
of the Capital Stock of their respective Subsidiaries, (ii) the making of
payments under intercompany Indebtedness permitted by Section 4.2.2, (iii)
the making of capital contributions to their respective Subsidiaries to the
extent permitted under Section 4.2.5 and (iv) the receipt of Distributions
permitted under Section 4.2.6 and the receipt of proceeds from, or the
receiving of payments under, intercompany Indebtedness permitted by Section
4.2.2 and Section 8.2.2 of the Credit Agreement, in each case to the extent
such proceeds or payments are concurrently used (A) to repay Indebtedness
of such Intermediate Parent Company to the extent such Indebtedness is
permitted under Section 4.2.2 or (B) to make a loan, advance or
Distribution to its parent or ADT Limited, to the extent such loan, advance
or Distribution is permitted under Section 4.2.5 or 4.2.6, as applicable.
(b) ADT Limited will not permit any Subsidiary of it that is (i)
a Non-Obligor and (ii) an obligee in respect of Indebtedness set
forth under the caption "Continuing Indebtedness - Intercompanies"
in Item 4.2.2(c) ("Ongoing Indebtedness") of the Disclosure
Schedule to receive any payments under any such Indebtedness, except
to the extent such payments are used within a reasonable period of
time, directly or indirectly, (A) to repay Indebtedness owing to an
Obligor or (B) to make a loan, advance or Distribution to an
Obligor, to the extent such loan, advance or Distribution is
permitted under Section 4.2.5 or 4.2.6, as applicable. ADT Limited
will not permit any of its Subsidiaries that is subject to the
subordination provisions of any Subordinated Intercompany Debt
(including Indebtedness in respect of the Dividended Note) to take
or omit to take any action the taking or the omission of which would
result in the failure of such Subsidiary fully and properly to
perform and observe all of its obligations in respect of such
subordination provisions.
SECTION 4.2.18. Ownership of Certain Subsidiaries. Except pursuant
to a transaction permitted pursuant to Section 4.2.9 or 4.2.10, ADT Limited
will not permit:
(a) any Subsidiary of Holdings N.V. now existing to not be at
any time a Wholly Owned Subsidiary of ADT Limited except to the
extent disclosed in Item 3.8 ("Existing Subsidiaries") of the
Disclosure Schedule; and
(b) any Subsidiary of the Borrower now existing to not be at any
time a Wholly Owned Subsidiary of the Borrower.
SECTION 4.2.19. Certain Intercompany Indebtedness. Without
limiting the effect of Section 4.2.11, ADT Limited will not, and will not
permit any of its Subsidiaries, to amend or modify the terms of any
Indebtedness referred to in clause (ii) of the proviso to Section 4.2.2,
which terms provide for satisfaction of such Indebtedness in cash at par.
SECTION 4.2.20. Any Action. ADT Limited will not, and will not
permit any of its Subsidiaries to, take or omit to take any action the
taking or the omission of which would result in the failure of the Borrower
or any other Obligor fully and properly to perform and observe all of its
obligations under the Credit Agreement or any other Loan Document to which
it is a party.
ARTICLE V
MISCELLANEOUS PROVISIONS
SECTION 5.1. Loan Document. This Guaranty is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise
expressly indicated herein) be construed, administered and applied in
accordance with the terms and provisions thereof, including, without
limitation, Article XI thereof.
SECTION 5.2. Binding on Successors, Transferees and Assigns;
Assignment. In addition to, and not in limitation of, Section 2.6, this
Guaranty shall be binding upon ADT Limited and its successors, transferees
and assigns and shall inure to the benefit of and be enforceable by each
Lender Party and each holder of a Note and their respective successors,
transferees and assigns (to the fullest extent provided pursuant to Section
2.6); provided, however, that ADT Limited may not assign any of its
obligations hereunder without the prior written consent of all Lenders.
SECTION 5.3. Amendments, etc. No amendment to or waiver of any
provision of this Guaranty, nor consent to any departure by ADT Limited
herefrom, shall in any event be effective unless the same shall be in
writing and signed by the Agent and consented to by the applicable Lenders
under Section 11.1 of the Credit Agreement, and then such waiver or consent
shall be effective only in the specific instance and for the specific
purpose for which given.
SECTION 5.4. Addresses for Notices. All notices and other
communications hereunder to ADT Limited shall be in writing or by facsimile
and mailed, telegraphed, transmitted or delivered to it, addressed to it at
the address set forth below its signature hereto or at such other address
as shall be designated by ADT Limited in a written notice to the Agent at
the address specified in the Credit Agreement complying as to delivery with
the terms of this Section. Any notice, if mailed and properly addressed
with postage prepaid, return receipt requested, or if properly addressed
and sent by pre-paid courier service, shall be deemed given when received;
any notice if transmitted by facsimile, shall be deemed given when
transmitted upon receipt of electronic confirmation of transmission (it
being understood and agreed that notice transmitted by facsimile to ADT
Inc. shall constitute notice to ADT Limited hereunder).
SECTION 5.5. No Waiver; Remedies. In addition to, and not in
limitation of, Section 2.2 and Section 2.4, no failure on the part of any
Lender Party or any holder of a Note to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any right hereunder preclude any
other or further exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative and not exclusive of any remedies
provided by law.
SECTION 5.6. Captions. Section captions used in this Guaranty are
for convenience of reference only, and shall not affect the construction of
this Guaranty.
SECTION 5.7. Setoff. In addition to, and not in limitation of, any
rights of any Lender Party or any holder of a Note under applicable law,
each Lender Party and each such holder shall, upon the occurrence of any
Event of Default, to the fullest extent permitted under applicable law,
have the right to appropriate and apply to the payment of the obligations
of ADT Limited owing to it hereunder, whether or not then due, any and all
balances, credits, deposits, accounts or moneys of ADT Limited then or
thereafter maintained with such Lender Party or such holder; provided,
however, that any such appropriation and application shall be subject to
the provisions of Section 5.8 of the Credit Agreement.
SECTION 5.8. Independence of Covenants. All covenants contained in
this Guaranty or any other Loan Document shall be given independent effect
such that, in the event 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 limitations of, another covenant
shall not, unless expressly so provided in such first covenant, avoid the
occurrence of a Default or an Event of Default if such action is taken or
such condition exists.
SECTION 5.9. Severability. Wherever possible each provision of
this Guaranty shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Guaranty shall be
prohibited by or invalid under such law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Guaranty.
SECTION 5.10. Governing Law. THIS GUARANTY SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW
YORK. ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS GUARANTY, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE AGENT (OR
ANY OTHER LENDER PARTY) SHALL BE BROUGHT AND MAINTAINED TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW EXCLUSIVELY IN THE COURTS OF THE STATE
OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT
AGAINST ANY PROPERTY MAY BE BROUGHT, AT THE AGENT'S OPTION, IN THE COURTS
OF ANY JURISDICTION WHERE SUCH PROPERTY MAY BE FOUND. FOR PURPOSES OF ANY
SUCH LITIGATION INVOLVING THIS GUARANTY, ADT LIMITED HEREBY EXPRESSLY
SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND
EXPRESSLY CONSENTS AND ACKNOWLEDGES THE TERMS AND AGREEMENTS SET FORTH IN
SECTION 2.9 HEREOF.
SECTION 5.11. Waiver of Jury Trial. ADT LIMITED AND, BY ITS
ACCEPTANCE HEREOF, THE AGENT (ON BEHALF OF THE LENDER PARTIES) HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO
A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT
OF, UNDER, OR IN CONNECTION WITH, THIS GUARANTY. ADT LIMITED ACKNOWLEDGES
AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS
PROVISION AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE LENDERS
ENTERING INTO THE CREDIT AGREEMENT AND MAKING CREDIT EXTENSIONS (INCLUDING
THE INITIAL CREDIT EXTENSION) TO THE BORROWER THEREUNDER.
IN WITNESS WHEREOF, ADT Limited has caused this Guaranty to be duly
executed and delivered by its officer thereunto duly authorized as of the
date first above written.
ADT LIMITED
/s/ Xxxxxxx X. Xxxxxx
BY:_________________________________
Title: Chief Financial Officer &
Executive Vice President
Address: Cedar House
41 Cedar Avenue
Xxxxxxxx XX 12
Bermuda
With a copy to:
ADT Inc.
0000 Xxxxx Xxxxx Xxxx
Xxxx Xxxxx, Xxxxxxx 00000
Facsimile No.: 000-000-0000
Attention: President
Acknowledged and Accepted:
THE BANK OF NOVA SCOTIA,
as Agent
/s/ Xxxxx X. Xxxxxxx
BY: ________________________________
Title: Relationship Manager
EXHIBIT J
[CONFORMED COPY]
SUBSIDIARY GUARANTOR GUARANTY
THIS SUBSIDIARY GUARANTOR GUARANTY (together with all amendments and
other modifications made from time to time, this "Guaranty"), dated as of
January 9, 1997, made by each Person (such capitalized term and all other
capitalized terms not otherwise defined herein to have the meanings provided
for in Article I) identified on the signature pages hereto and each Additional
Subsidiary Guarantor (collectively, the "Subsidiary Guarantors"), in favor of
each of the Lender Parties.
W I T N E S S E T H:
WHEREAS, pursuant to a Credit Agreement, dated as of January 9, 1997
(together with all amendments and other modifications, if any, from time to
time thereafter made thereto, the "Credit Agreement"), among ADT Operations,
Inc., a Delaware corporation (the "Borrower"), the financial institutions as
are or may become parties thereto (collectively, the "Lenders"), and The Bank
of Nova Scotia ("Scotiabank"), individually and as agent (the "Agent") for the
Lenders, the Lenders have extended Commitments to make Credit Extensions to or
on behalf of the Borrower;
WHEREAS, as a condition precedent to the occurrence of the Closing Date
under the Credit Agreement, each Subsidiary Guarantor is required to execute
and deliver this Guaranty;
WHEREAS, each Subsidiary Guarantor has duly authorized the execution,
delivery and performance of this Guaranty; and
WHEREAS, it is in the best interests of each Subsidiary Guarantor to
execute this Guaranty inasmuch as each Subsidiary Guarantor will derive
substantial direct and indirect benefits from the Credit Extensions made from
time to time to or on behalf of the Borrower by the Lenders;
NOW THEREFORE, for good and valuable consideration the receipt of which
is hereby acknowledged, each Subsidiary Guarantor agrees, for the benefit of
each Lender Party, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Certain Terms. The following terms (whether or not
underscored) when used in this Guaranty, including its preamble and
recitals, shall have the following meanings (such definitions to be equally
applicable to the singular and plural forms thereof):
"Agent" is defined in the first recital.
"Borrower" is defined in the first recital.
"Credit Agreement" is defined in the first recital.
"Guaranty" is defined in the preamble.
"Lender" is defined in the first recital.
"Lender Party" means, as the context may require, any Lender, any
Issuer or the Agent and each of their respective successors, transferees
and assigns.
"Lenders" is defined in the first recital.
"Other Taxes" is defined in clause (b) of Section 2.7.
"Scotiabank" is defined in the first recital.
"Subsidiary Guarantor" is defined in the preamble.
"Taxes" is defined in clause (a) of Section 2.7.
"U.C.C." means the Uniform Commercial Code as in effect in the State
of New York.
SECTION 1.2. Credit Agreement Definitions. Unless otherwise
defined herein or the context otherwise requires, terms used in this
Guaranty, including its preamble and recitals, have the meanings provided
in the Credit Agreement.
ARTICLE II
GUARANTY PROVISIONS
SECTION 2.1. Guaranty. Each Subsidiary Guarantor hereby
absolutely, unconditionally and irrevocably, jointly and severally,
(a) guarantees the full and punctual payment when due, whether
at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise, of all Obligations of the
Borrower and each other Obligor now or hereafter existing, whether
for principal, interest, Reimbursement Obligations, fees, expenses
or otherwise (including all such amounts which would become due but
for the operation of the automatic stay under Section 362(a) of the
United States Bankruptcy Code, 11 U.S.C. Section 362(a), and the
operation of Sections 502(b) and 506(b) of the United States
Bankruptcy Code, 11 U.S.C. Section 502(b) and Section 506(b)); and
(b) indemnifies and holds harmless each Lender Party and each
holder of a Note for any and all costs and expenses (including
reasonable attorney's fees and expenses) incurred by such Lender
Party or such holder, as the case may be, in enforcing any rights
under this Guaranty;
provided, however, that each Subsidiary Guarantor shall be liable under
this Guaranty for the maximum amount of such liability that can be hereby
incurred without rendering this Guaranty, as it relates to such Subsidiary
Guarantor, voidable under applicable law relating to fraudulent conveyance
or fraudulent transfer, and not for any greater amount. This Guaranty
constitutes a guaranty of payment when due and not of collection, and each
Subsidiary Guarantor specifically agrees that it shall not be necessary or
required that any Lender Party or any holder of any Note exercise any
right, assert any claim or demand or enforce any remedy whatsoever against
the Borrower or any other Obligor (or any other Person) before or as a
condition to the obligations of such Subsidiary Guarantor hereunder.
SECTION 2.2. Guaranty Absolute, etc. This Guaranty shall in all
respects be a continuing, absolute, unconditional and irrevocable guaranty
of payment, and shall remain in full force and effect until all Obligations
of the Borrower and each other Obligor have been paid in full, all
obligations of each Subsidiary Guarantor hereunder shall have been paid in
full and all Commitments shall have terminated. Each Subsidiary Guarantor
guarantees that the Obligations of the Borrower and each other Obligor and
their respective Subsidiaries will be paid strictly in accordance with the
terms of the Credit Agreement and each other Loan Document under which they
arise, without regard (to the fullest extent permitted under applicable
law) to any law, regulation or order now or hereafter in effect in any
jurisdiction affecting any of such terms or the rights of any Lender Party
or any holder of any Note with respect thereto (and each Subsidiary
Guarantor hereby waives to the fullest extent it may do so any right or
rights it may have under any such law, regulation or order). Without
limiting the generality of the foregoing, the liability of each Subsidiary
Guarantor under this Guaranty shall be absolute, unconditional and
irrevocable irrespective of:
(a) any lack of genuineness, validity, legality or
enforceability of the Credit Agreement or any other Loan Document
(other than, in respect of such Subsidiary Guarantor, this Guaranty)
or of any of the Obligations (other than the Obligations of such
Subsidiary Guarantor hereunder);
(b) the failure of any Lender Party or any holder of any Note
(i) to assert any claim or demand or to enforce any right or
remedy against the Borrower, any other Obligor or any other
Person (including any other Subsidiary Guarantor) under the
provisions of the Credit Agreement or any other Loan Document
or otherwise, or
(ii) to exercise any right or remedy against any other
guarantor (including any other Subsidiary Guarantor) of, or
collateral securing, any Obligations of the Borrower or any
other Obligor;
(c) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations of the Borrower or
any other Obligor (other than such Subsidiary Guarantor), or any
other extension, compromise or renewal of any Obligation of the
Borrower or any other Obligor (other than such Subsidiary
Guarantor);
(d) any reduction, limitation, impairment or termination of the
Obligations of the Borrower or any other Obligor (other than such
Subsidiary Guarantor) for any reason, including any claim of waiver,
release, surrender, alteration or compromise, and shall not be
subject to (and each Subsidiary Guarantor hereby waives any right to
or claim of) any defense or setoff, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality,
nongenuineness, irregularity, compromise, unenforceability of, or
any other event or occurrence affecting, the Obligations of the
Borrower, any other Obligor (other than such Subsidiary Guarantor)
or otherwise;
(e) any amendment to, rescission, waiver, or other modification
of, or any consent to departure from, any of the terms of the Credit
Agreement or any other Loan Document (other than, in respect of such
Subsidiary Guarantor, this Guaranty);
(f) any addition, exchange, release, surrender or non-perfection
of any collateral, or any amendment to or waiver or release of or
addition to, or consent to departure from, any other guaranty
(including the ADT Limited Guaranty), held by any Lender Party or
any holder of any Note securing any of the Obligations of the
Borrower or any other Obligor; or
(g) any other circumstances which might otherwise constitute a
defense available to, or a legal or equitable discharge of, the
Borrower, any other Obligor, any surety or any other guarantor (or
any other Guarantor).
SECTION 2.3. Stay of Acceleration, Reinstatement, etc. Each
Subsidiary Guarantor agrees that, if acceleration of the time for payment
of any amount payable by the Borrower under the Credit Agreement, the Notes
or any other Loan Document or of compliance by the Borrower with its
obligations under Section 4.7 of the Credit Agreement is, in either case,
stayed upon the occurrence with respect to the Borrower of any Event of
Default described in clause (b) or (d) of Section 9.1.9 of the Credit
Agreement, all such amounts and obligations otherwise subject to
acceleration or compliance under the terms of the Credit Agreement shall
nonetheless be payable and performed by such Subsidiary Guarantor hereunder
forthwith on demand by the Agent made at the request of the requisite
proportion of the Lenders specified in Section 9.3 of the Credit Agreement.
Each Subsidiary Guarantor agrees that this Guaranty shall continue to be
effective or be reinstated, as the case may be, if at any time any payment
(in whole or in part) of any of the Obligations is rescinded or must
otherwise be restored by any Lender Party or any holder of any Note, upon
the insolvency, bankruptcy or reorganization of the Borrower, any other
Obligor (other than such Subsidiary Guarantor) or otherwise, all as though
such payment had not been made.
SECTION 2.4. Waiver, etc. Each Subsidiary Guarantor hereby waives
promptness, diligence, notice of acceptance and any other notice with
respect to any of the Obligations of the Borrower or any other Obligor and
this Guaranty and any requirement that the Agent, any other Lender Party or
any holder of any Note protect, secure, perfect or insure any security
interest or Lien, or any property subject thereto, or exhaust any right or
take any action against the Borrower, any other Obligor or any other Person
(including any other guarantor and any other Guarantor) or entity or any
collateral securing the Obligations of the Borrower or any other Obligor,
as the case may be.
SECTION 2.5. Subrogation. Each Subsidiary Guarantor hereby agrees
that it will not exercise any rights which it may now or hereafter acquire
against the Borrower or any other Obligor that arise from the existence,
payment, performance or enforcement of such Subsidiary Guarantor's
obligations under this Guaranty or any other Loan Document, including any
right of subrogation, reimbursement, exoneration, or indemnification, any
right to participate in any claim or remedy of the Lender Parties against
the Borrower or any other Obligor or any collateral which the Agent now has
or hereafter acquires, whether or not such claim, remedy or right arises in
equity, or under contract, statute or common law, including the right to
take or receive from the Borrower or any other Obligor, directly or
indirectly, in cash or other property or by set-off or in any manner,
payment or security on account of such claim or other rights, until the
Obligations have been paid in full in cash and the Commitments have been
terminated. If any amount shall be paid to such Subsidiary Guarantor in
violation of the preceding sentence and the Obligations shall not have been
paid in cash in full and the Commitments have not been terminated, such
amount shall be deemed to have been paid to such Subsidiary Guarantor for
the benefit of, and held in trust for, the Lender Parties, and shall
forthwith be paid to the Lender Parties to be credited and applied upon the
Obligations, whether matured or unmatured. Each Subsidiary Guarantor
acknowledges that it will receive direct and indirect benefits from the
financing arrangements contemplated by the Credit Agreement and that the
agreement set forth in this Section is knowingly made in contemplation of
such benefits.
SECTION 2.6. Successors, Transferees and Assigns; Transfers of
Notes, etc. This Guaranty shall:
(a) be binding upon each Subsidiary Guarantor and its
successors, transferees and assigns; and
(b) inure to the benefit of and be enforceable by the Agent and
each other Lender Party.
Without limiting the generality of clause (b), any Lender may assign or
otherwise transfer (in whole or in part) any Note or Loan held by it to any
other Person or entity, and such other Person or entity shall thereupon
become vested with all rights and benefits in respect thereof granted to
such Lender under any Loan Document (including this Guaranty) or otherwise,
subject, however, to the provisions of Section 11.11 and Article X of the
Credit Agreement.
SECTION 2.7. Payments Free and Clear of Taxes, etc. Each
Subsidiary Guarantor hereby agrees that:
(a) Any and all payments made by such Subsidiary Guarantor
hereunder shall be made in accordance with Section 5.6 of the Credit
Agreement free and clear of, and without deduction for, any and all
present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding,
in the case of each Lender Party or any holder of a Note, taxes
imposed on its net income and franchise taxes imposed on it (such
non-excluded items being hereinafter referred to as "Taxes"). If
any such Subsidiary Guarantor shall be required by law to deduct any
Taxes from or in respect of any sum payable hereunder to any Lender
Party or any holder of a Note
(i) the sum payable shall be increased as may be necessary
so that after making all required deductions (including
deductions applicable to additional sums payable under this
Section) such Lender Party or such holder, as the case may be,
receives an amount equal to the sum it would have received had
no such deductions been made,
(ii) such Subsidiary Guarantor shall make such deductions,
and
(iii) such Subsidiary Guarantor shall pay the full amount
deducted to the relevant taxation authority or other authority
in accordance with applicable law.
(b) Such Subsidiary Guarantor shall pay any present or future
stamp or documentary taxes or any other excise or property taxes,
charges or similar levies which arise from any payment made
hereunder or from the execution, delivery or registration of, or
otherwise with respect to, this Guaranty (hereinafter referred to as
"Other Taxes").
(c) Such Subsidiary Guarantor hereby indemnifies and holds
harmless each Lender Party and each of holder of a Note for the full
amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed by any jurisdiction on amounts payable
under this Section) paid by such Lender Party or such holder, as the
case may be, and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto, whether or not
such Taxes or Other Taxes were correctly or legally asserted.
(d) Without prejudice to the survival of any other agreement of
such Subsidiary Guarantor hereunder, the agreements and obligations
of such Subsidiary Guarantor contained in this Section 2.7 shall
survive the payment in full of the principal of and interest on the
Loans.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties. Each Subsidiary
Guarantor hereby represents and warrants for itself unto each Lender Party
as to all matters contained in Article VII of the Credit Agreement and
Article III of the ADT Limited Guaranty, in each case insofar as applicable
to such Subsidiary Guarantor or such Subsidiary Guarantor's properties,
together with all related definitions and ancillary provisions, all of
which are hereby incorporated into this Section 3.1 as those specifically
set forth herein. In addition, each Subsidiary Guarantor hereby represents
and warrants for itself unto each Lender Party as further set forth in this
Article III.
SECTION 3.1.1. Organization, etc. Such Subsidiary Guarantor and
each of its Subsidiaries is a corporation duly organized and validly
existing and in good standing under the laws of the State of its
incorporation, is duly qualified to do business and is in good standing as
a foreign corporation in each jurisdiction where the nature of its business
or the location of its assets requires such qualification and where the
failure to so qualify or be in good standing would reasonably be expected
to have a material adverse effect on the business, results of operations,
financial condition or prospects of the Borrower and its Subsidiaries taken
as a whole. Such Subsidiary Guarantor and each of its Subsidiaries has
full power and authority and holds all requisite governmental licenses,
permits and other approvals (i) to own and hold under lease its property
and to conduct its business substantially as currently conducted by it,
except where failure to hold such licenses, permits and other approvals
would not reasonably be expected to have a material adverse effect on the
business, results of operations, financial condition or prospects of the
Borrower and its Subsidiaries taken as a whole and (ii) to enter into and
perform its obligations under this Guaranty and each other Loan Document to
which it is a party.
SECTION 3.1.2. Due Authorization, Non-Contravention, etc. The
execution, delivery and performance by such Subsidiary Guarantor of this
Guaranty and each other Loan Document executed or to be executed by it and
such Subsidiary Guarantor's participation in the consummation of the
Transaction are within such Subsidiary Guarantor's corporate powers, have
been duly authorized by all necessary corporate action, and do not
(a) contravene such Subsidiary Guarantor's Organic Documents;
(b) contravene any contractual restriction, law or governmental
regulation or court decree or order binding on or affecting such
Subsidiary Guarantor in any manner that could reasonably be expected
(i) to have a material adverse effect on the business, results of
operations, financial condition or prospects of the Borrower and its
Subsidiaries taken as a whole, (ii) to impair the ability of any
Lender, any Issuer or the Agent to enforce the Obligations or (iii)
to subject any Lender, any Issuer or the Agent to any liability; or
(c) result in, or require the creation or imposition of, any
Lien on any of such Subsidiary Guarantor's properties.
SECTION 3.1.3. Government Approval, Regulation, etc. No
authorization or approval or other action by, and no notice to or filing
with, any governmental authority or regulatory body or other Person is
required for the due execution, delivery or performance by such Subsidiary
Guarantor of this Guaranty or any other Loan Document to which it is a
party. No Subsidiary Guarantor is an "investment company" within the
meaning of the Investment Company Act of 1940, as amended, or a "holding
company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
SECTION 3.1.4. Validity, etc. This Guaranty constitutes, and each
other Loan Document executed by such Subsidiary Guarantor will, on the due
execution and delivery thereof, constitute, the legal, valid and binding
obligations of such Subsidiary Guarantor enforceable in accordance with
their respective terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws from time to time in effect
affecting enforceability of creditors' rights generally and to general
principles of equity.
ARTICLE IV
COVENANTS, ETC.
SECTION 4.1. Affirmative Covenants. Each Subsidiary Guarantor
covenants and agrees that, until the Covenant Termination Date, such
Subsidiary Guarantor will perform, comply with and be bound by all the
agreements, covenants and obligations contained in Article VIII of the
Credit Agreement and Article IV of the ADT Limited Guaranty applicable to
such Subsidiary Guarantor or such Subsidiary Guarantor's properties. Each
such agreement, covenant and obligation contained in each such Article and
all related definitions and ancillary provisions are hereby incorporated
into this Guaranty as though specifically set forth herein.
ARTICLE V
MISCELLANEOUS PROVISIONS
SECTION 5.1. Loan Document. This Guaranty is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise
expressly indicated herein) be construed, administered and applied in
accordance with the terms and provisions thereof, including, without
limitation, Article XI thereof.
SECTION 5.2. Binding on Successors, Transferees and Assigns;
Assignment. In addition to, and not in limitation of, Section 2.6, this
Guaranty shall be binding upon each Subsidiary Guarantor and its
successors, transferees and assigns and shall inure to the benefit of and
be enforceable by each Lender Party and each holder of a Note and their
respective successors, transferees and assigns (to the full extent provided
pursuant to Section 2.6); provided, however, that no Subsidiary Guarantor
may assign any of its obligations hereunder without the prior written
consent of all Lenders.
SECTION 5.3. Amendments, etc. No amendment to or waiver of any
provision of this Guaranty, nor consent to any departure by any Subsidiary
Guarantor herefrom, shall in any event be effective unless the same shall
be in writing and signed by each Subsidiary Guarantor and the Agent, and
then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
SECTION 5.4. Addresses for Notices to the Subsidiary Guarantor.
All notices and other communications hereunder to any Subsidiary Guarantor
shall be in writing or by facsimile and addressed, delivered or transmitted
to it in care of the Borrower at the address and facsimile number and in
the manner provided for in Section 11.2 of the Credit Agreement.
SECTION 5.5. No Waiver; Remedies. In addition to, and not in
limitation of, Section 2.2 and Section 2.4, no failure on the part of any
Lender Party or any holder of a Note to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any right hereunder preclude any
other or further exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative and not exclusive of any remedies
provided by law.
SECTION 5.6. Headings. The various headings used in this Guaranty
are for convenience of reference only and shall not affect the construction
of this Guaranty.
SECTION 5.7. Setoff. In addition to, and not in limitation of, any
rights of any Lender Party or any holder of a Note under applicable law,
each Lender Party and each such holder shall, upon the occurrence of any
Event of Default, to the fullest extent permitted under applicable law,
have the right to appropriate and apply to the payment of the obligations
of any Subsidiary Guarantor owing to it hereunder, whether or not then due,
any and all balances, credits, deposits, accounts or moneys of such
Subsidiary Guarantor then or thereafter maintained with such Lender Party
or such holder; provided, however, that any such appropriation and
application shall be subject to the provisions of Section 5.8 of the Credit
Agreement.
SECTION 5.8. Severability. Wherever possible, each provision of
this Guaranty shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Guaranty shall be
prohibited by or invalid under such law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Guaranty.
SECTION 5.9. Execution in Counterparts. This Guaranty may be
executed by the parties hereto in several counterparts, each of which shall
be deemed to be an original and all of which shall constitute together but
one and the same agreement.
SECTION 5.10. Governing Law; Entire Agreement. THIS GUARANTY
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF NEW YORK. THIS GUARANTY AND THE OTHER LOAN DOCUMENTS
CONSTITUTE THE ENTIRE UNDERSTANDING AMONG THE PARTIES HERETO WITH RESPECT
TO THE SUBJECT MATTER HEREOF AND SUPERSEDE ANY PRIOR AGREEMENTS, WRITTEN OR
ORAL, WITH RESPECT THERETO.
SECTION 5.11. Forum Selection and Consent to Jurisdiction. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH,
THIS GUARANTY, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE LENDER PARTIES OR ANY
SUBSIDIARY GUARANTOR SHALL BE BROUGHT AND MAINTAINED TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW
YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY
COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE AGENT'S OPTION, IN THE
COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE
FOUND. EACH SUBSIDIARY GUARANTOR HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS
TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE
PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO
BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH
LITIGATION. EACH SUBSIDIARY GUARANTOR FURTHER IRREVOCABLY CONSENTS TO THE
SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL
SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK. EACH SUBSIDIARY GUARANTOR
HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF
VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE
AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM. TO THE EXTENT THAT ANY SUBSIDIARY GUARANTOR HAS OR HEREAFTER MAY
ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL
PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, SUCH SUBSIDIARY GUARANTOR HEREBY IRREVOCABLY WAIVES TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW SUCH IMMUNITY IN RESPECT OF ITS
OBLIGATIONS UNDER THIS GUARANTY.
SECTION 5.12. Waiver of Jury Trial. THE LENDER PARTIES AND EACH
SUBSIDIARY GUARANTOR HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE
ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
GUARANTY, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
ORAL OR WRITTEN) OR ACTIONS OF THE LENDER PARTIES OR ANY SUBSIDIARY
GUARANTOR. EACH SUBSIDIARY GUARANTOR ACKNOWLEDGES AND AGREES THAT IT HAS
RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH
OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE LENDER PARTIES
ENTERING INTO THE CREDIT AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
SECTION 5.13. Additional Subsidiary Guarantors. Upon execution and
delivery by the Agent and any other Person (each such Person being an
"Additional Subsidiary Guarantor") of an instrument in the form of Annex I
attached hereto, such Additional Subsidiary Guarantor shall become a
Subsidiary Guarantor hereunder with the same force and effect as if
originally named as a Subsidiary Guarantor herein. The execution and
delivery of any such instrument shall not require the consent of any
Subsidiary Guarantor hereunder. The rights and obligations of each
Subsidiary Guarantor hereunder shall remain in full force and effect
notwithstanding the addition of any Additional Subsidiary Guarantor as a
party to this Guaranty.
[REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]
IN WITNESS WHEREOF, each Subsidiary Guarantor has caused this Guaranty
to be duly executed and delivered by its officer thereunto duly authorized as
of the date first above written.
ADT GENERAL HOLDINGS, INC.
/s/ Xxx X. Xxxxxx
By: ____________________________
Title: Treasurer
ADT SECURITY SERVICES, INC.
(formerly known as ADT SECURITY
SYSTEMS, INC.)
/s/ Xxx X. Xxxxxx
By: ____________________________
Title: Treasurer
ADT SECURITY SYSTEMS, WEST, INC.
/s/ Xxx X. Xxxxxx
By: ____________________________
Title: Treasurer
ADT AUTOMOTIVE, INC.
/s/ Xxxxx X. Xxxxx
By: ____________________________
Title: Senior Vice President
ADT AUTOMOTIVE HOLDINGS, INC.
/s/ Xxxxx X. Xxxxx
By: ____________________________
Title: Vice President
AA PROPERTY HOLDINGS, INC.
/s/ Xxxxx X. Xxxxx
By: ____________________________
Title: President
ADT INVESTMENTS, INC.
/s/ Xxx X. Xxxxxx
By: ____________________________
Title: Treasurer
AAAA DEALERS SERVICES, INC.
/s/ Xxxxx X. Xxxxx
By: ____________________________
Title: President
ADT BUSINESS HOLDINGS, INC.
/s/ Xxx X. Xxxxxx
By: ____________________________
Title: Treasurer
ADT PROPERTY HOLDINGS, INC.
/s/ Xxxxxx X. Xxxxxx
By: ____________________________
Title: Secretary
ADT SECURITY SYSTEMS MANUFACTURING,
INC.
/s/ Xxx X. Xxxxxx
By: ____________________________
Title: Treasurer
MID-ATLANTIC SECURITY, INC.
/s/ Xxx X. Xxxxxx
By: ____________________________
Title: Treasurer
ADT AUTOMOTIVE SERVICES, INC.
/s/ Xxxxx X. Xxxxx
By: ____________________________
Title: President
AUCTION TRANSPORT, INC.
/s/ Xxxxxxx X. Xxxxxx
By: ____________________________
Title: President
BRITISH CAR AUCTIONS, INC.
/s/ Xxx X. Xxxxxx
By: ____________________________
Title: Treasurer
CCTC INTERNATIONAL, INC.
/s/ Xxx X. Xxxxxx
By: ____________________________
Title: Treasurer
ADT SPECIALTY AUCTIONS, INC.
/s/ Xxxxx X. Xxxxx
By: ____________________________
Title: President
FLYING LION INC.
/s/ Xxxxx X. Xxxxx
By: ____________________________
Title: President
TRI-CITY AUTO AUCTION, INC.
/s/ Xxxxx X. Xxxxx
By: ____________________________
Title: President
ADT SERVICES, INC.
/s/ Xxxxxx X. Xxxxxx
By: ____________________________
Title: President
Acknowledged and Accepted:
THE BANK OF NOVA SCOTIA,
as Agent
/s/ Xxxxx X. Xxxxxxx
By: ____________________________
Title: Relationship Manager
ANNEX I
to
Subsidiary Guarantor Guaranty
SUBSIDIARY GUARANTOR GUARANTY SUPPLEMENT
THIS SUBSIDIARY GUARANTOR GUARANTY SUPPLEMENT (this "Supplement"), dated
as of _____________, 199_, to the Subsidiary Guarantor Guaranty, dated as of
January 9, 1997 (as amended or otherwise modified through the date hereof, the
"Subsidiary Guaranty"), made by each Person identified on the signature pages
thereto, certain other Persons who subsequently became a party thereto by
executing an agreement in substantially the form hereof (each an "Additional
Subsidiary Guarantor" and, together with each Person identified on the
signature pages of the Guaranty, the "Subsidiary Guarantors"), in favor of The
Bank of Nova Scotia ("Scotiabank"), as documentation agent (the "Documentation
Agent") for each of the Lender Parties (such capitalized term and all other
capitalized terms used in this Supplement without being defined shall have the
meaning provided for in the Subsidiary Guaranty).
W I T N E S S E T H:
WHEREAS, pursuant to a Credit Agreement, dated as of January 9, 1997
(together with all amendments and other modifications, if any, from time to
time made thereto, the "Credit Agreement"), among ADT Operations, Inc., a
Delaware corporation (the "Borrower"), the financial institutions as are or
may become parties thereto (collectively, the "Lenders"), and The Bank of Nova
Scotia ("Scotiabank"), individually and as agent (the "Agent") for the
Lenders, the Lenders have extended Commitments to make Credit Extensions to or
on behalf of the Borrower;
WHEREAS, it is in the best interests of the undersigned (the "New
Additional Subsidiary Guarantor") to execute this Supplement inasmuch as the
New Additional Subsidiary Guarantor will derive substantial direct and
indirect benefits from the Credit Extensions made by the Lenders pursuant to
the Credit Agreement; and
WHEREAS, the New Additional Subsidiary Guarantor desires to become an
Additional Subsidiary Guarantor under the Subsidiary Guaranty pursuant to
Section 5.13 thereof;
NOW, THEREFORE, for good and valuable consideration the receipt of which
is hereby acknowledged, the New Additional Subsidiary Guarantor agrees, for
the benefit of each Lender Party, as follows:
SECTION 1. Additional Subsidiary Guarantor. In accordance with Section
5.13 of the Subsidiary Guaranty, the New Additional Subsidiary Guarantor by
its signature hereto shall become a Subsidiary Guarantor under the Subsidiary
Guaranty with the same force and effect as if originally named as a Subsidiary
Guarantor therein, and each reference to a "Subsidiary Guarantor" or an
"Additional Subsidiary Guarantor" in the Subsidiary Guaranty shall be deemed
to include the New Additional Subsidiary Guarantor. The New Additional
Subsidiary Guarantor hereby agrees to all the terms and provisions of the
Subsidiary Guaranty applicable to it as an Additional Subsidiary Guarantor
thereunder.
SECTION 2. Guaranty. Without limiting the terms of Section 1, the New
Additional Subsidiary Guarantor hereby absolutely, unconditionally and
irrevocably, jointly and severally,
(a) guarantees the full and punctual payment when due, whether at
stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise, of all Obligations of the Borrower and each
other Obligor, whether for principal, interest, fees, expenses or
otherwise (including all such amounts which would become due but for
the operation of the automatic stay under Section 362(a) of the
United States Bankruptcy Code, 11 U.S.C. Section 362(a), and the
operation of Sections 502(b) and 506(b) of the United States
Bankruptcy Code, 11 U.S.C. Section 502(b) and Section 506(b)); and
(b) indemnifies and holds harmless each Lender Party and each holder
of a Note for any and all costs and expenses (including reasonable
attorney's fees and expenses) incurred by such Lender Party or such
holder, as the case may be, in enforcing any rights under this
Supplement or the Subsidiary Guaranty;
provided, however, that the New Additional Subsidiary Guarantor shall be
liable under this Supplement and the Subsidiary Guaranty for the maximum
amount of such liability that can be incurred without rendering this
Supplement and the Subsidiary Guaranty, as it relates to the New Additional
Subsidiary Guarantor, voidable under applicable law relating to fraudulent
conveyance or fraudulent transfer, and not for any greater amount. This
Supplement and the Subsidiary Guaranty constitute a guaranty of payment when
due and not of collection, and the New Additional Subsidiary Guarantor
specifically agrees that it shall not be necessary or required that any Lender
Party or any holder of any Note exercise any right, assert any claim or demand
or enforce any remedy whatsoever against the Borrower or any other Obligor (or
any other Person) before or as a condition to the obligations of the New
Additional Subsidiary Guarantor under this Supplement or the Subsidiary
Guaranty.
SECTION 3. Warranties, etc. The New Additional Subsidiary Guarantor
hereby represents and warrants unto each Lender Party, as of the date hereof,
as follows:
(a) each of the representations and warranties set forth in Article
III of the Subsidiary Guaranty as applied to such New Additional
Subsidiary Guarantor are true and correct; and
(b) the execution, delivery and performance by the New Additional
Subsidiary Guarantor of this Supplement are within its corporate powers,
have been duly authorized by all necessary corporate action and
constitute the legal, valid and binding obligation of the New Additional
Subsidiary Guarantor enforceable against it in accordance with its
terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws from time to time in effect affecting
enforceability of creditors, rights generally and to general principles
of equity.
SECTION 4. Subsidiary Guaranty Remains in Full Force and Effect.
Except as expressly supplemented hereby, the Subsidiary Guaranty shall remain
in full force and effect in accordance with its terms.
SECTION 5. Governing Law. THIS SUPPLEMENT SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK.
SECTION 6. Severability. Wherever possible each provision of this
Supplement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Supplement shall be
prohibited by or invalid under such law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this Supplement.
SECTION 7. Execution in Counterparts. This Supplement may be executed
by the parties hereto in several counterparts, each of which shall be deemed
to be an original and all of which shall constitute but one and the same
agreement.
SECTION 8. Consent to Jurisdiction. If the New Additional Subsidiary
Guarantor is organized under the laws of a jurisdiction outside of the United
States, such New Additional Subsidiary Guarantor shall consent to the
jurisdiction of New York courts (including the appointment of an agent to
receive summons and complaints in connection with any litigation) on terms
reasonably satisfactory to the Agent.
SECTION 9. Expenses. Without limiting the provisions of the Credit
Agreement, the New Additional Subsidiary Guarantor agrees to reimburse the
Agent for all reasonable out-of-pocket expenses incurred in connection with
this Supplement, including the reasonable fees and expenses of counsel of the
Agent.
SECTION 10. Notices. The address and facsimile number for all notices
to be delivered to the New Additional Subsidiary Guarantor in connection with
the Subsidiary Guaranty is as set forth in Section 5.4 of the Subsidiary
Guaranty.
SECTION 11. Subsidiary Guaranty. This Supplement hereby incorporates
by reference the provisions of the Subsidiary Guaranty, which provisions are
deemed to be a part hereof, and this Supplement shall be deemed to be a part
of the Subsidiary Guaranty.
IN WITNESS WHEREOF, the New Additional Subsidiary Guarantor has duly
executed this Supplement to the Subsidiary Guaranty as of the day and year
first above written.
[NAME OF NEW ADDITIONAL
SUBSIDIARY GUARANTOR]
By: ____________________________
Title:
Acknowledged and Accepted:
THE BANK OF NOVA SCOTIA,
as Agent
By: ____________________________
Title:
