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EXHIBIT 10.28
EXECUTION VERSION
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CREDIT AGREEMENT
Dated as of January 31, 2001
among
NEW CERIDIAN CORPORATION,
as the Borrower,
BANK OF AMERICA, N.A.,
as the Administrative Agent
and
L/C Issuer,
and
The Other Lenders Party Hereto
BANC OF AMERICA SECURITIES LLC,
as
Sole Lead Arranger and Sole Book Manager
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TABLE OF CONTENTS
Section Page
ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS.......................................................................1
1.01 Defined Terms...................................................................................1
1.02 Other Interpretive Provisions..................................................................20
1.03 Accounting Terms...............................................................................21
1.04 Rounding.......................................................................................22
1.05 References to Agreements and Laws..............................................................22
ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS................................................................22
2.01 Loans..........................................................................................22
2.02 Borrowings, Conversions and Continuations of Loans.............................................22
2.03 Letters of Credit..............................................................................24
2.04 Prepayments....................................................................................31
2.05 Reduction or Termination of Commitments........................................................31
2.06 Repayment of Loans.............................................................................32
2.07 Interest.......................................................................................32
2.08 Fees...........................................................................................32
2.09 Computation of Interest and Fees...............................................................33
2.10 Evidence of Debt...............................................................................33
2.11 Payments Generally.............................................................................34
2.12 Sharing of Payments............................................................................36
2.13 Increase in Commitments........................................................................36
ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY..............................................................37
3.01 Taxes..........................................................................................37
3.02 Illegality.....................................................................................39
3.03 Inability to Determine Rates...................................................................39
3.04 Increased Cost and Reduced Return; Capital Adequacy............................................39
3.05 Funding Losses.................................................................................40
3.06 Matters Applicable to all Requests for Compensation............................................41
3.07 Survival.......................................................................................41
ARTICLE IV. CONDITIONS PRECEDENT.................................................................................41
4.01 Conditions to Effectiveness....................................................................41
4.02 Conditions to Initial Credit Extension.........................................................43
4.03 Conditions to all Credit Extensions............................................................45
ARTICLE V. REPRESENTATIONS AND WARRANTIES........................................................................46
5.01 Corporate Existence and Power..................................................................46
5.02 Corporate Authorization; No Contravention......................................................47
5.03 Governmental Authorization.....................................................................47
5.04 Binding Effect.................................................................................47
5.05 Litigation.....................................................................................48
5.06 No Default.....................................................................................48
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5.07 ERISA Compliance...............................................................................49
5.08 Title to Properties............................................................................49
5.09 Taxes..........................................................................................49
5.10 Financial Condition............................................................................50
5.11 Environmental Matters..........................................................................51
5.12 Regulated Entities.............................................................................51
5.13 No Burdensome Restrictions.....................................................................51
5.14 Solvency.......................................................................................52
5.15 Labor Relations................................................................................52
5.16 Copyrights, Patents, Trademarks and Licenses, Etc..............................................52
5.17 Material Subsidiaries and Equity Investments...................................................52
5.18 Insurance......................................................................................53
5.19 Spin-Off Documents.............................................................................53
5.20 Full Disclosure................................................................................53
5.21 Third-Party Consents...........................................................................53
5.22 Year End.......................................................................................53
5.23 Existing Indebtedness..........................................................................54
5.24 Swap Contracts.................................................................................54
ARTICLE VI. AFFIRMATIVE COVENANTS................................................................................54
6.01 Financial Statements...........................................................................54
6.02 Certificates; Other Information................................................................55
6.03 Notices........................................................................................56
6.04 Preservation of Corporate Existence, Etc.......................................................57
6.05 Maintenance of Property........................................................................58
6.06 Insurance......................................................................................58
6.07 Payment of Obligations.........................................................................58
6.08 Compliance with Laws...........................................................................58
6.09 Inspection of Property and Books and Records...................................................59
6.10 Environmental Laws.............................................................................59
6.11 Use of Proceeds................................................................................59
6.12 Further Assurances.............................................................................59
ARTICLE VII. NEGATIVE COVENANTS..................................................................................60
7.01 Limitation on Liens............................................................................60
7.02 Mergers, Consolidations and Dispositions of Assets.............................................62
7.03 Cash Investments; Minority Investments.........................................................63
7.04 Indebtedness...................................................................................63
7.05 Contingent Obligations.........................................................................64
7.06 Use of Proceeds................................................................................64
7.07 Hostile Acquisitions...........................................................................65
7.08 Lease Obligations..............................................................................65
7.09 Interest Coverage Ratio........................................................................65
7.10 Debt/Total Capitalization......................................................................65
7.11 Change in Business.............................................................................65
7.12 Accounting Changes.............................................................................65
7.13 Contracts of Subsidiaries......................................................................66
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7.14 Licenses.......................................................................................66
7.15 Transactions with Affiliates...................................................................66
7.16 Certain Tax-Matters............................................................................66
7.17 Certain Contracts..............................................................................66
ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES.....................................................................67
8.01 Events of Default..............................................................................67
8.02 Remedies Upon Event of Default.................................................................69
ARTICLE IX. ADMINISTRATIVE AGENT.................................................................................70
9.01 Appointment and Authorization of Administrative Agent..........................................70
9.02 Delegation of Duties...........................................................................71
9.03 Liability of Administrative Agent..............................................................71
9.04 Reliance by Administrative Agent...............................................................71
9.05 Notice of Default..............................................................................72
9.06 Credit Decision; Disclosure of Information by Administrative Agent.............................72
9.07 Indemnification of Administrative Agent........................................................73
9.08 Administrative Agent in its Individual Capacity................................................73
9.09 Successor Administrative Agent.................................................................73
9.10 Other Agents; Lead Managers....................................................................74
ARTICLE X. MISCELLANEOUS.........................................................................................74
10.01 Amendments, Etc................................................................................74
10.02 Notices and Other Communications; Facsimile Copies.............................................75
10.03 No Waiver; Cumulative Remedies.................................................................76
10.04 Attorney Costs, Expenses and Taxes.............................................................77
10.05 Indemnification by the Borrower................................................................77
10.06 Payments Set Aside.............................................................................78
10.07 Successors and Assigns.........................................................................78
10.08 Confidentiality................................................................................81
10.09 Set-off........................................................................................82
10.10 Interest Rate Limitation.......................................................................82
10.11 Counterparts...................................................................................82
10.12 Integration....................................................................................82
10.13 Survival of Representations and Warranties.....................................................83
10.14 Severability...................................................................................83
10.15 Foreign Lenders................................................................................83
10.16 Removal and Replacement of Lenders.............................................................84
10.17 Governing Law..................................................................................85
10.18 Waiver of Right to Trial by Jury...............................................................86
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SCHEDULES
1.01(e) Existing Letter of Credit
1.01(i) Initial Permitted Indebtedness
1.01(s) Spin-Off Documents
2.01 Commitments and Pro Rata Shares
5.05 Material Litigation
5.07 ERISA Matters
5.10 Contingent Obligations
5.11 Environmental Matters
5.17 Subsidiaries
5.17(A) Investments
5.21 Third Party Consents Required to Consummate the Spin-Off Transaction
7.02 Permitted Corporate Transactions
10.02 Eurodollar and Domestic Lending Offices, Addresses for Notices
EXHIBITS
FORM OF
A Loan Notice
B Loan Note
C Compliance Certificate
D Assignment and Acceptance
E Guaranty
F Effectiveness Date Opinion of Counsel (Content Summary)
G Closing Date Opinion of Counsel (Content Summary)
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CREDIT AGREEMENT
This CREDIT AGREEMENT ("Agreement") is entered into as of January 31,
2001, among NEW CERIDIAN CORPORATION, a Delaware corporation, (the "Borrower"),
each lender from time to time party hereto (collectively, the "Lenders" and
individually, a "Lender"), and BANK OF AMERICA, N.A., as Administrative Agent
and L/C Issuer.
The Borrower has requested that the Lenders provide a revolving credit
facility, and the Lenders are willing to do so on the terms and conditions set
forth herein.
In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:
ARTICLE I.
DEFINITIONS AND ACCOUNTING TERMS DEFINED TERMS.
1.01 DEFINED TERMS. As used in this Agreement, the following terms
shall have the meanings set forth below:
"Administrative Agent" means Bank of America in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.
"Administrative Agent's Office" means the Administrative Agent's
address and, as appropriate, account as set forth on Schedule 10.02, or such
other address or account as the Administrative Agent may from time to time
notify to the Borrower and the Lenders.
"Affiliate" means, as to any Person, any other Person directly or
indirectly controlling, controlled by, or under direct or indirect common
control with, such Person. A Person shall be deemed to be "controlled by" any
other Person if such other Person possesses, directly or indirectly, power (a)
to vote 15% 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 Person
whether by contract or otherwise.
"Agent/Arranger " has the meaning set forth in Section 2.08(c).
"Agent-Related Persons" means the Administrative Agent (including any
successor administrative agent), together with its Affiliates (including, in the
case of Bank of America in its capacity as the Administrative Agent, the
Arranger), and the officers, directors, employees, agents and attorneys-in-fact
of such Persons and Affiliates.
"Aggregate Commitments" has the meaning set forth in the definition of
"Commitment."
"Agreement" means this Credit Agreement.
"Applicable Rate" means the following percentages per annum, each based
upon the applicable "Pricing Level":
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Applicable Rate
Pricing Debt Ratings Commitment Eurodollar
Level S&P/Xxxxx'x Fee Rate + Base Rate
Letters of
Credit
1 A-/A3 0.100% 0.575% 0.000%
and above
2 BBB+/Baa1 0.125% 0.675% 0.000%
3 BBB/Baa2 0.150% 0.875% 0.000%
4 BBB-/Baa3 0.175% 1.000% 0.000%
5 BB+/Ba1 0.250% 1.250% 0.000%
6 BB/Ba2 0.350% 1.750% 0.000%
and lower
"Debt Rating" means, as of any date of determination, the
rating as determined by either S&P or Moody's (collectively, the "Debt
Ratings") of the Borrower's non-credit-enhanced, senior unsecured
long-term debt; provided that if a Debt Rating is issued by each of the
foregoing rating agencies which would result in different Pricing
Levels, then the higher of such Debt Ratings shall apply (with Pricing
Level 1 being the highest and Pricing Level 6 being the lowest).
Pricing Level 6 shall apply at any time as there shall exist no Debt
Rating.
Initially, and at any time until 180 days after the Closing Date, the Applicable
Rate shall be determined based upon the lower of (i) Pricing Level 4 or (ii) the
Pricing Level corresponding to the lowest Debt Rating in effect at such time or
at any time after the Closing Date and prior to such time during such 180-day
period. Immediately following such 180-day period, the Applicable Rate shall be
based upon the Pricing Level corresponding to the then-applicable Debt Rating.
Any change in the Applicable Rate resulting from a publicly announced change in
the Debt Rating shall be effective on and as of the date of such public
announcement of any Debt Rating that indicates a different Applicable Rate in
accordance with this definition and the above chart.
"Arbitron Business" means, collectively, the businesses of (a)
providing media and marketing research services to broadcasters, advertising
agencies, advertisers, on-line webcasters, and cable television; (b) providing
media audience and consumer retail behavior research services to cable systems,
television broadcasters, magazines and newspapers; and (c) providing application
software used to access and analyze media audience information and software
applications to access and analyze consumer retail behavior and media usage.
"Arbitron Credit Agreement" means that certain Credit Agreement, dated
as of the Effectiveness Date, among the Parent, the lenders from time to time
party thereto and Bank of America, N.A., as administrative agent.
"Arbitron Private Placement Documents" means those documents executed
and delivered by the Parent to effectuate the Parent's private placement of
senior secured notes in the amount of $50,000,000, each in connection with the
Spin-Off Transaction.
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"Arranger" means Banc of America Securities LLC, in its capacity as
sole lead arranger and sole book manager.
"Assignment and Acceptance" means an Assignment and Acceptance
substantially in the form of Exhibit D.
"Attorney Costs" means and includes all fees and disbursements of any
law firm or other external counsel and the non-duplicative allocated cost of
internal legal services and all disbursements of internal counsel.
"Attributable Indebtedness" means, on any date, (a) in respect of any
Capital Lease of any Person, the capitalized amount thereof that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP,
(b) in respect of any Synthetic Lease Obligation, the capitalized amount of the
remaining lease payments under the relevant lease that would appear on a balance
sheet of such Person prepared as of such date in accordance with GAAP if such
lease were accounted for as a Capital Lease, and (c) in respect of any Permitted
Securitization, the present value of the remaining stream of scheduled or
expected payments due or to become due with respect to any and all Permitted
Receivables at such time subject to such Permitted Securitization, discounted at
a rate equal to the then applicable interest rate of the indebtedness associated
with the Permitted Securitization.
"Audited Financial Statements" means the audited consolidated balance
sheet of the Borrower and its Subsidiaries for the fiscal years ended December
31, 1998 and December 31, 1999 (in each case, giving effect to the Spin-Off
Transaction) and the related consolidated statements of income and cash flows
for the fiscal years of the Borrower ended December 31, 1997, December 31, 1998
and December 31, 1999, each in the final form attached to the Form 10.
"Bank of America" means Bank of America, N.A.
"Base Rate" means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest
in effect for such day as publicly announced from time to time by Bank of
America as its "prime rate." Such rate is a rate set by Bank of America based
upon various factors, including Bank of America's costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below such announced
rate. Any change in such rate announced by Bank of America shall take effect at
the opening of business on the day specified in the public announcement of such
change.
"Base Rate Loan" means a Loan that bears interest based on the Base
Rate.
"Borrower" has the meaning set forth in the introductory paragraph
hereto.
"Borrowing" means a borrowing consisting of simultaneous Loans of the
same Type and having the same Interest Period made by each of the Lenders
pursuant to Section 2.01.
"Business Day" means any day other than a Saturday, Sunday, or other
day on which commercial banks are authorized to close under the Laws of, or are
in fact closed in, the state
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where the Administrative Agent's Office is located and, if such day relates to
any Eurodollar Rate Loan, means any such day on which dealings in Dollar
deposits are conducted by and between banks in the applicable offshore Dollar
interbank market.
"Capital Lease" means, as applied to any Person, any lease of property
by such Person as lessee that is classified as a capital lease under GAAP.
"Cash Collateralize" means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the L/C Issuer and the Lenders, as
collateral for the L/C Obligations, cash or deposit account balances pursuant to
documentation in form and substance reasonably satisfactory to the
Administrative Agent and the L/C Issuer (which documents are hereby consented to
by the Lenders). Derivatives of such term shall have corresponding meaning.
Effective as of the time of such pledge, deposit or delivery, the Borrower
hereby grants the Administrative Agent, for the benefit of the L/C Issuer and
the Lenders, a Lien on all such cash and deposit account balances. Cash
collateral shall be maintained in blocked, non-interest bearing deposit accounts
with the Administrative Agent.
"Cash Equivalents" means:
(a) securities issued or fully guaranteed or insured by the
United States Government or any agency thereof, having maturities of
not more than six months from the date of acquisition;
(b) certificates of deposit, time deposits, Eurodollar time
deposits, repurchase agreements, reverse repurchase agreements, or
bankers' acceptances, having in each case a tenor of not more than six
months, issued by any Lender, or by any U.S. commercial or investment
bank or broker having combined capital and surplus of not less than
$100,000,000 whose short term securities are rated at least A-1 by S&P
and P-1 by Moody's;
(c) commercial paper or promissory notes of an issuer rated at
least A-1 by S&P or P-1 by Moody's and in either case having a tenor of
not more than three months; and
(d) money market funds which comply with all material
provisions of Rule 2a-7 issued by the SEC under the Investment Company
Act of 1940.
"Change of Control" means, with respect to the Borrower, an event or
series of events by which:
(a) For any date on or after the Spin-Off Consummation
Date:
(i) any "person" or "group" (as such terms are used
in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, but excluding any employee benefit plan of the Borrower
or its Subsidiaries, or any Person acting in its capacity as
trustee, agent or other fiduciary or administrator of any such
plan), becomes the "beneficial owner" (as defined in Rules
13d-3 and 13d-5 under the Securities Exchange Act of 1934,
except that a person shall be deemed to have
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"beneficial ownership" of all securities that such person has
the right to acquire (such rights, "option rights"), whether
such right is exercisable immediately or only after the
passage of time), directly or indirectly, of 30% or more of
the equity interests of the Borrower on a partially-diluted
basis, taking into account equity interests realizable upon
the exercise of such person's or group's option rights; or
(ii) during any period of 12 consecutive months, a
majority of the members of the board of directors or other
equivalent governing body of the Borrower ceases to be
composed of individuals (A) who were members of that board or
equivalent governing body on the first day of such period, (B)
whose election or nomination to that board or equivalent
governing body was approved by individuals referred to in
clause (A) above constituting at the time of such election or
nomination at least a majority of that board or equivalent
governing body; or (C) whose election or nomination to that
board or other equivalent governing body was approved by
individuals referred to in clauses (A) and (B) above
constituting at the time of such election or nomination at
least a majority of that board or equivalent governing body.
(b) For any date prior to the Spin-Off Consummation Date, the
Borrower shall cease to be a Wholly-Owned Subsidiary of the Parent.
"Closing Date" means the first date all the conditions precedent in
Section 4.02 are satisfied or waived in accordance with Section 4.02.
"Code" means the Internal Revenue Code of 1986.
"Comdata" means Comdata Network, Inc., a Maryland corporation, or any
of its Subsidiaries.
"Commitment" means, as to each Lender, its obligation (a) to make Loans
to the Borrower pursuant to Section 2.01, and (b) to purchase participations in
L/C Obligations, in an aggregate principal amount at any one time outstanding
not to exceed the amount set forth opposite such Lender's name on Schedule 2.01,
as such amount may be reduced or adjusted from time to time in accordance with
this Agreement (collectively, the "Aggregate Commitments").
"Compliance Certificate" means a certificate substantially in the form
of Exhibit C.
"Consolidated EBIT" means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, an amount equal to the sum of (a)
Consolidated Net Income, plus (b) Consolidated Interest Expense, plus (c) the
amount of taxes, based on or measured by income, used or included in the
determination of such Consolidated Net Income, less (d) interest income;
provided, however, "Consolidated Net Income" shall be computed for these
purposes without giving effect to extraordinary losses or gains, or losses or
gains from discontinued operations.
"Consolidated Indebtedness" means, at any time, the sum of (a) all
amounts which would, in accordance with GAAP, be included as indebtedness on a
consolidated balance sheet of the Borrower and its Subsidiaries as of such time,
(b) Attributable Indebtedness incurred by
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the Borrower or any of its Subsidiaries in connection with any Permitted
Securitization, (c) Attributable Indebtedness incurred by the Borrower or any of
its Subsidiaries in connection with any Synthetic Lease, and (d) Attributable
Indebtedness incurred by the Borrower or any of its Subsidiaries in connection
with any Capital Lease.
"Consolidated Interest Expense" means, for any period, for the Borrower
and its Subsidiaries on a consolidated basis, the sum of (a) all interest,
premium payments, fees, charges and related expenses of the Borrower and its
Subsidiaries in connection with borrowed money (including capitalized interest)
or in connection with the deferred purchase price of assets, in each case to the
extent treated as interest in accordance with GAAP, and (b) the portion of rent
expense of the Borrower and its Subsidiaries with respect to such period under
Capital Leases that is treated as interest in accordance with GAAP.
"Consolidated Net Income" means, for any period, for the Borrower and
its Subsidiaries on a consolidated basis, the net income of the Borrower and its
Subsidiaries from continuing operations, as determined in accordance with GAAP.
"Consolidated Net Worth" means, at any time, with respect to the
Borrower and its Subsidiaries on a consolidated basis, shareholders' equity on
the date of determination as determined in accordance with GAAP (except that the
effects of direct charges or credits to shareholders' equity related to
accounting for pensions ("FAS 87") and foreign currency translation ("FAS 52")
are to be disregarded).
"Consolidated Total Assets" means, at any time, the total consolidated
assets of the Borrower and its Subsidiaries measured as of the last day of the
fiscal quarter ending on or before the date of determination, as determined in
accordance with GAAP.
"Contingent Obligation" means, as to the Borrower or any of its
Subsidiaries, (a) any Guaranty Obligation of that Person; (b) any reimbursement
obligation of that Person with respect to a standby letter of credit, surety
bond, banker's acceptance, bank guaranty or similar instrument; (c) any
obligation of that Person to purchase any materials, supplies or other property
from, or to obtain the services of, another Person (other than the Borrower or
one of its Subsidiaries) if the relevant contract or other related document or
obligation requires that payment for such materials, supplies or other property,
or for such services, shall be made regardless of whether delivery of such
materials, supplies or other property is ever made or tendered, or such services
are ever performed or tendered; and (d) all Indebtedness (other than that of the
Borrower or any of its Subsidiaries) secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on property (including accounts and contract rights) owned by the
Borrower or any such Subsidiary.
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Credit Extension" means each of the following: (a) a Borrowing, and
(b) an L/C Credit Extension.
"Debt Rating" has the meaning set forth in the definition of
"Applicable Rate."
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"Debtor Relief Laws" means the Bankruptcy Code of the United States of
America, and all other liquidation, conservatorship, bankruptcy, assignment for
the benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States of America or
other applicable jurisdictions from time to time in effect and affecting the
rights of creditors generally.
"Default" means any event that, with the giving of any notice, the
passage of time, or both, would be an Event of Default.
"Default Rate" means an interest rate equal to (a) the Base Rate plus
(b) the Applicable Rate, if any, applicable to Base Rate Loans plus (c) 2% per
annum, provided, however, that with respect to a Eurodollar Rate Loan, the
Default Rate shall be an interest rate equal to the interest rate (including any
Applicable Rate) otherwise applicable to such Loan plus 2% per annum; in each
case to the fullest extent permitted by applicable Laws.
"Distribution" means the distribution by dividend of all stock of the
Borrower held by the Parent to the Parent's shareholders, pursuant to a tax-free
transaction under Section 355 of the Code and undertaken pursuant to the
Spin-Off Documents.
"Dollar" and "$" mean lawful money of the United States of America.
"Effectiveness Date" means the first day all the conditions precedent
in Section 4.01 are satisfied or waived in accordance with Section 4.01 (or, in
the case of Section 4.01(c), waived by the Person entitled to receive the
applicable payment).
"Eligible Assignee" has the meaning specified in Section 10.07(h).
"Environmental Claims" means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law or for release or injury
to the environment or threat to public health, personal injury (including
sickness, disease or death), property damage, natural resources damage, or
otherwise alleging liability or responsibility for damages (punitive or
otherwise), cleanup, removal, remedial or response costs, restitution, civil or
criminal penalties, injunctive relief, or other type of relief, resulting from
or based upon (a) the alleged or actual presence, placement, migration,
spillage, leakage, disposal, discharge, emission or release of any Hazardous
Material at, in, or from property, whether or not owned by the Borrower, or (b)
any other circumstances forming the basis of any violation, or alleged
violation, of any Environmental Law.
"Environmental Laws" means all federal, state or local laws, statutes,
common law duties, rules, regulations, ordinances and codes, together with all
administrative orders, directed duties, requests, licenses, authorizations,
registration requirements and permits of, and agreements with, any Governmental
Authorities, in each case relating to environmental and land use matters, or
health and safety matters involving Hazardous Materials.
"ERISA" means the Employee Retirement Income Security Act of 1974 and
any regulations issued pursuant thereto.
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"ERISA Affiliate" means any trade or business (whether or not
incorporated) that is currently or at any relevant time in the past was under
common control with the Borrower within the meaning of Section 414(b) or (c) of
the Code (and Sections 414(m) and (o) of the Code for purposes of provisions
relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension
Plan subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Section 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which would reasonably be
expected to constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Pension Plan or
Multiemployer Plan; or (f) the imposition of any liability under Title IV of
ERISA, other than PBGC premiums due but not delinquent under Section 4007 of
ERISA, upon the Borrower or any ERISA Affiliate.
"Eurodollar Rate" means for any Interest Period with respect to any
Eurodollar Rate Loan, a rate per annum determined by the Administrative Agent
pursuant to the following formula:
Eurodollar Rate = Eurodollar Base Rate
-------------------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
"Eurodollar Base Rate" means, for such Interest Period:
(a) the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate that appears on the page of
the Telerate screen that displays an average British Bankers
Association Interest Settlement Rate for deposits in Dollars (for
delivery on the first day of such Interest Period) with a term
equivalent to such Interest Period, determined as of approximately
11:00 a.m. (London time) two Business Days prior to the first day of
such Interest Period, or
(b) in the event the rate referenced in the preceding
subsection (a) does not appear on such page or service or such page or
service shall cease to be available, the rate per annum equal to the
rate determined by the Administrative Agent to be the offered rate on
such other page or other service that displays an average British
Bankers Association Interest Settlement Rate for deposits in Dollars
(for delivery on the first day of such Interest Period) with a term
equivalent to such Interest Period, determined as of approximately
11:00 a.m. (London time) two Business Days prior to the first day of
such Interest Period, or
8. New Ceridian Credit Agreement
14
(c) in the event the rates referenced in the preceding
subsections (a) and (b) are not available, the rate per annum
determined by the Administrative Agent as the rate of interest (rounded
upward to the next 1/16th of 1%) at which deposits in Dollars for
delivery on the first day of such Interest Period in same day funds in
the approximate amount of the Eurodollar Rate Loan being made,
continued or converted by Bank of America and with a term equivalent to
such Interest Period would be offered by Bank of America's London
Branch to major banks in the offshore Dollar market at their request at
approximately 11:00 a.m. (London time) two Business Days prior to the
first day of such Interest Period.
"Eurodollar Reserve Percentage" means, for any day during any Interest
Period, the reserve percentage (expressed as a decimal, rounded upward to the
next 1/100th of 1%) in effect on such day, whether or not applicable to any
Lender, under regulations issued from time to time by the Board of Governors of
the Federal Reserve System for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve requirement)
with respect to Eurocurrency funding (currently referred to as "Eurocurrency
liabilities") having a term comparable to such Interest Period. The Eurodollar
Rate for each outstanding Eurodollar Rate Loan shall be adjusted automatically
as of the effective date of any change in the Eurodollar Reserve Percentage.
"Eurodollar Rate Loan" means a means a Loan that bears interest at a
rate based on the Eurodollar Rate.
"Event of Default" means any of the events or circumstances specified
in Article VIII.
"Evergreen Letter of Credit" has the meaning set forth in Section
2.03(b)(iii).
"Exchange Act" means the Securities Exchange Act of 1934.
------------
"Existing Credit Facility" means that certain Amended and Restated
Credit Agreement dated as of July 31, 1997 among the Parent, Bank of America, as
agent, and a syndicate of lenders, and after giving effect to that certain
"Waiver to Credit Agreement" entered into by such parties as of December 20,
2000.
"Existing Letter of Credit" means the letter of credit listed at
Schedule 1.01(e).
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upwards to the nearest 1/100 of 1%) equal to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank on the Business Day next succeeding such day; provided that
(a) if such day is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (b) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such
day shall be the average rate charged to Bank of America on such day on such
transactions as determined by the Administrative Agent.
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System of the United States of America.
9. New Ceridian Credit Agreement
15
"Foreign Lender" has the meaning specified in Section 10.15.
"Form 10" means, until the Closing Date, that certain Form 10 filing
prepared by the Borrower and delivered to the SEC on or about December 6, 2000
in connection with the Spin-Off Transaction, as amended by that amendment filed
with the SEC on or about December 27, 2000, and by that amendment filed with the
SEC on or about January 22, 2001. From and after the Closing Date, the term
"Form 10" shall also include (a) any amendments to the Form 10 filed with the
SEC between the Effectiveness Date and the Closing Date to the extent permitted
by Section 4.02(a)(i)(H), and (b) any amendments to the Form 10 filed with the
SEC after the Closing Date to the extent necessary to accommodate changes to the
Spin-Off Documents permitted by Section 7.17.
"Form 10 Financial Statements" means the Audited Financial Statements
plus all related unaudited financial statements filed with the Form 10.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or such other principles as may be
approved by a significant segment of the accounting profession, that are
applicable to the circumstances as of the date of determination, consistently
applied.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or capital
ownership or otherwise, by any of the foregoing.
"Guarantor" means, at all times prior to the Spin-Off Consummation
Date, the Parent.
"Guaranty" means the Guaranty made by the Guarantor in favor of the
Administrative Agent on behalf of the Lenders, substantially in the form of
Exhibit E.
"Guaranty Obligation" means, as to any Person, (a) any obligation,
contingent or otherwise, of such Person guarantying or having the economic
effect of guarantying any Indebtedness or other obligation payable or
performable by another Person (the "primary obligor") in any manner, whether
directly or indirectly, and including any obligation of such Person, direct or
indirect, (i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness or other obligation, (ii) to purchase or lease
property, securities or services for the purpose of assuring the obligee in
respect of such Indebtedness or other obligation of the payment or performance
of such Indebtedness or other obligation, (iii) to maintain working capital,
equity capital or any other financial statement condition or liquidity of the
primary obligor so as to enable the primary obligor to pay such Indebtedness or
other obligation, or (iv) entered into for the purpose of assuring in any other
manner the obligees in respect of such Indebtedness or other obligation of the
payment or performance thereof or to protect such obligees against loss in
respect thereof (in whole or in part), or (b) any Lien on any
10. New Ceridian Credit Agreement
16
assets of such Person securing any Indebtedness or other obligation of any other
Person, whether or not such Indebtedness or other obligation is assumed by such
Person; provided, however, that the term "Guaranty Obligation" shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business. The amount of any Guaranty Obligation shall be deemed to be an amount
equal to the stated or determinable amount of the related primary obligation, or
portion thereof, in respect of which such Guaranty Obligation is made or, if not
stated or determinable, the maximum reasonably anticipated liability in respect
thereof as determined by the guarantying Person in good faith.
"Hazardous Materials" means all those substances which are regulated
by, or which may form the basis of liability under, any Environmental Law,
including all substances identified under any Environmental Law as a pollutant,
contaminant, hazardous waste, hazardous constituent, hazardous chemicals,
special waste, hazardous substance, hazardous material, regulated substance, or
toxic substance, or petroleum or petroleum derived substance or waste.
"Honor Date" has the meaning set forth in Section 2.03(c)(i).
"Increase Effective Date" has the meaning set forth in Section 2.13(b).
"Indebtedness" means, as to any Person at a particular time, all of the
following:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes, loan
agreements or other similar instruments;
(b) any fixed (non-contingent) obligations of such Person
arising under letters of credit (including standby and commercial),
bankers acceptances, bank guaranties, surety bonds and similar
instruments;
(c) net obligations under any Swap Contract in an amount equal
to (i) if such Swap Contract has been closed out, the Swap Termination
Value, or (ii) if such Swap Contract has not been closed out, the
xxxx-to-market value thereof determined on the basis of readily
available quotations provided by any recognized dealer in such Swap
Contract;
(d) 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 (other than trade payables entered into
in the Ordinary Course of Business pursuant to ordinary terms and paid
within the specified time), 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; and
(e) Capital Leases and Synthetic Lease Obligations.
For all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture (which is not itself a
corporation, limited liability company or limited
11. New Ceridian Credit Agreement
17
liability partnership) in which such Person is a general partner or a joint
venturer, unless such Indebtedness is expressly made non-recourse to such
Person, except for customary exceptions acceptable to the Required Lenders. The
amount of any Capital Lease or Synthetic Lease Obligation as of any date shall
be deemed to be the amount of Attributable Indebtedness in respect thereof as of
such date. Without limiting the generality of the foregoing, any indebtedness of
the Borrower to any of the Borrower's Wholly-Owned Subsidiaries or of any of the
Borrower's Wholly-Owned Subsidiaries to another of the Borrower's Wholly-Owned
Subsidiaries shall not constitute Indebtedness hereunder.
"Indemnified Liabilities" has the meaning set forth in Section 10.05.
"Indemnitees" has the meaning set forth in Section 10.05.
"Initial Permitted Indebtedness" means that Indebtedness set forth on
Schedule 1.01(i).
"Interest Payment Date" means, (a) as to any Loan other than a Base
Rate Loan, the last day of each Interest Period applicable to such Loan;
provided, however, that if any Interest Period for a Eurodollar Rate Loan
exceeds three months, the respective dates that fall every three months after
the beginning of such Interest Period shall also be Interest Payment Dates; and
(b) as to any Base Rate Loan, the last Business Day of each March, June,
September and December, and the Maturity Date.
"Interest Period" means as to each Eurodollar Rate Loan, the period
commencing on the date such Eurodollar Rate Loan is disbursed or (in the case of
any Eurodollar Rate Loan) converted to or continued as a Eurodollar Rate Loan
and ending on the date one, two, three or six months thereafter, as selected by
the Borrower in its Loan Notice; provided that:
(i) any Interest Period that would otherwise end on a
day that is not a Business Day shall be extended to the next
succeeding Business Day unless, in the case of a Eurodollar
Rate Loan, such Business Day falls in another calendar month,
in which case such Interest Period shall end on the next
preceding Business Day;
(ii) any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at
the end of such Interest Period) shall end on the last
Business Day of the calendar month at the end of such Interest
Period; and
(iii) no Interest Period shall extend beyond the
scheduled Maturity Date.
"Investment" of a Person means (i) the outstanding principal amount of
any loan, advance, extension of credit (other than loans, advances or extensions
of credit arising in the Ordinary Course of Business), or (ii) the amount
(measured by the amount of cash expended or the then-current fair market value
of other assets, including stock of such Person, utilized as consideration) of
any contribution of capital by such Person to any other Person or any investment
in, or purchase or other acquisition of, the stock, partnership or membership
interests, notes, debentures or other securities of any other Person made by
such Person, reduced by the
12. New Ceridian Credit Agreement
18
amount of any distribution by such other Person constituting a return of
capital, any payment of principal on such notes, debentures or other debt
securities, or any proceeds from the sale of any equity or debt securities of
such other Person.
"IRS" means the United States Internal Revenue Service.
"IRS Ruling Letter" means an affirmative private letter ruling by the
IRS regarding the tax-free nature of the Spin-Off Transaction.
"Laws" means, collectively, all international, foreign, Federal, state
and local statutes, treaties, rules, guidelines, regulations, ordinances, codes
and administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
"L/C Advance" means, with respect to each Lender, such Lender's
participation in any L/C Borrowing in accordance with its Pro Rata Share.
"L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Borrowing.
"L/C Credit Extension" means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the renewal or
increase of the amount thereof.
"L/C Issuer" means Bank of America in its capacity as issuer of Letters
of Credit hereunder, or any successor issuer of Letters of Credit hereunder.
"L/C Obligations" means, as at any date of determination, the aggregate
undrawn face amount of all outstanding Letters of Credit plus the aggregate of
all Unreimbursed Amounts, including all L/C Borrowings.
"Lead Lender" means Bank of America, The Bank of New York or U.S. Bank
National Association.
"Lender" has the meaning specified in the introductory paragraph hereto
and, as the context requires, includes the L/C Issuer.
"Lending Office" means, as to any Lender, the office or offices of such
Lender described as such on Schedule 10.02, or such other office or offices as a
Lender may from time to time notify the Borrower and the Administrative Agent.
"Letter of Credit" means any standby letter of credit issued hereunder
and shall include the Existing Letter of Credit.
"Letter of Credit Application" means an application and agreement for
the issuance or amendment of a letter of credit in the form from time to time in
use by the L/C Issuer.
13. New Ceridian Credit Agreement
19
"Letter of Credit Backstop Date" means the day that is seven days prior
to the scheduled Maturity Date (or, if such day is not a Business Day, the next
preceding Business Day).
"Letter of Credit Sublimit" means an amount equal to the lesser of the
Aggregate Commitments and $50,000,000. The Letter of Credit Sublimit is part of,
and not in addition to, the Aggregate Commitments.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement of any kind or
nature whatsoever (including any conditional sale or other title retention
agreement, any financing lease having substantially the same economic effect as
any of the foregoing, and the filing of any financing statement under the
Uniform Commercial Code or comparable Laws of any jurisdiction), including the
interest of a purchaser of accounts receivable, but excluding the interest of a
lessor under an Operating Lease.
"Loan" has the meaning specified in Section 2.01.
"Loan Documents" means this Agreement, each Loan Note, the
Agent/Arranger Fee Letter, each Request for Credit Extension, each Compliance
Certificate, the Guaranty, and any document executed by the Borrower to
accomplish Cash Collateralization.
"Loan Note" means a promissory note made by the Borrower in favor of a
Lender evidencing Loans made by such Lender, substantially in the form of
Exhibit B.
"Loan Notice" means a notice of (a) a Borrowing, (b) a conversion of
Loans from one Type to the other, or (c) a continuation of Loans as the same
Type, pursuant to Section 2.02(a), which, in each case, shall be substantially
in the form of Exhibit A.
"Loan Parties" means, collectively, the Borrower and the Guarantor.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, condition
(financial or otherwise) or prospects of the Borrower and its Subsidiaries taken
as a whole or, at any time prior to the Spin-Off Consummation Date, the Parent
and its Subsidiaries taken as a whole; (b) a material impairment of the ability
of any Loan Party to perform its obligations under any Loan Document to which it
is a party or, at any time prior to the Spin-Off Consummation Date, the ability
of the Parent to perform its obligations under any Spin-Off Document to which it
is party; or (c) a material adverse effect upon the legality, validity, binding
effect or enforceability against any Loan Party of any Loan Document to which it
is a party or, at any time prior to the Spin-Off Consummation Date, against the
Parent of any Spin-Off Document to which it is a party.
"Material Subsidiary" means at any time any Subsidiary of the Borrower
(other than a Securitization Subsidiary), the assets of which are 10% or more of
Consolidated Total Assets (or the equivalent thereof in another currency), based
upon the most recent financial statements delivered to the Administrative Agent
under Section 4.01(a) (vii), 4.02(a) (iii) or 6.01.
14. New Ceridian Credit Agreement
20
"Maturity Date" means (a) the date that is five years after the Closing
Date, or (b) such earlier date upon which the Commitments may be terminated in
accordance with the terms hereof.
"Maximum Rate" has the meaning set forth in Section 10.10.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA
Affiliate makes or is obligated to make contributions, or during the preceding
three calendar years, has made or been obligated to make contributions.
"Nonrenewal Notice Date" has the meaning set forth in Section
2.03(b)(iii).
"Notice of Lien" means any "notice of lien" or similar document
intended to be filed or recorded with any court, registry, recorder's office,
central filing office or other Governmental Authority for the purpose of
evidencing, creating, perfecting or preserving the priority of a lien securing
obligations owing to a Governmental Authority.
"Obligations" means all advances to, and debts, liabilities,
obligations, covenants and duties of, any Loan Party arising under any Loan
Document, whether direct or indirect (including those acquired by assumption),
absolute or contingent, due or to become due, now existing or hereafter arising
and including interest that accrues after the commencement by or against any
Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief
Laws naming such Person as the debtor in such proceeding.
"Operating Lease" means, as applied to any Person, any lease of
property which is not a Capital Lease.
"Ordinary Course of Business" means, in respect of any transaction
involving the Borrower or any Subsidiary, the ordinary course of such Person's
business, as conducted by any such Person (or its predecessor) in accordance
with past practice and undertaken by such Person in good faith and not for
purposes of evading any covenant or restriction in any Loan Document.
"Organization Documents" means, (a) with respect to any corporation,
the certificate or articles of incorporation and the bylaws; (b) with respect to
any limited liability company, the articles of formation and operating
agreement; and (c) with respect to any partnership, joint venture, trust or
other form of business entity, the partnership, joint venture or other
applicable agreement of formation and any agreement, instrument, filing or
notice with respect thereto filed in connection with its formation with the
secretary of state or other department in the state of its formation, in each
case as amended from time to time.
"Other Taxes" has the meaning set forth in Section 3.01(b).
"Outstanding Amount" means (i) with respect to Loans, on any date, the
aggregate outstanding principal amount thereof after giving effect to any
borrowings and prepayments or repayments of Loans, occurring on such date; and
(ii) with respect to any L/C Obligations on any
15. New Ceridian Credit Agreement
21
date, the amount of such L/C Obligations on such date after giving effect to any
L/C Credit Extension occurring on such date and any other changes in the
aggregate amount of the L/C Obligations as of such date, including as a result
of any reimbursements of outstanding unpaid drawings under any Letters of Credit
or any reductions in the maximum amount available for drawing under Letters of
Credit taking effect on such date.
"Parent" means Ceridian Corporation, a Delaware corporation.
"Participant" has the meaning set forth in Section 10.07(d).
"PBGC" means the Pension Benefit Guaranty Corporation.
"Pension Plan" means any "employee pension benefit plan" (as such term
is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer plan
(as described in Section 4064(a) of ERISA) has made contributions at any time
during the immediately preceding five plan years.
"Permitted Liens" has the meaning specified in Section 7.01.
"Permitted Receivables" means accounts receivable originated by Comdata
in the Ordinary Course of Business, together with any guarantees, insurance,
letters of credit, collateral and other ancillary property rights of Comdata
arising in connection with the transactions giving rise to such accounts
receivable.
"Permitted Securitization" means (a) a transfer constituting a sale
under GAAP and accompanied by the delivery of a customary true-sale opinion
given by independent counsel, to a Securitization Subsidiary or other Person of
Permitted Receivables by Comdata for fair value consideration consisting of
cash, or cash plus a subordinated interest in the Securitization Subsidiary or
in the transferred Permitted Receivables, and that does not entail, directly or
indirectly, recourse against the seller of such Permitted Receivables (or
against any of such seller's Affiliates, other than a Securitization Subsidiary)
by way of a guarantee or other direct or indirect support arrangement, with
respect to the amount of such receivables based on the financial condition or
circumstances of the obligor thereunder, other than such limited recourse as is
reasonable given market standards for transactions of a similar type, taking
into account such factors as historical bad debt, loss experience and obligor
concentration levels; and (b) if applicable, the issuance by the Securitization
Subsidiary of Indebtedness secured by a Lien on any or all of the assets of such
Securitization Subsidiary; provided, however, that the Attributable Indebtedness
arising in connection with all Permitted Securitizations in the aggregate shall
not at any time exceed $150,000,000.
"Permitted Swap Obligations" means all obligations (contingent or
otherwise) of the Borrower or any of its Subsidiaries existing or arising under
Swap Contracts, provided that such obligations are (or were) entered into by
such Person in the ordinary course of such Person's business for the purpose of
directly mitigating risks associated with liabilities, commitments or assets
held or reasonably anticipated by such Person, or changes in the value of
securities issued
16. New Ceridian Credit Agreement
22
by such Person in conjunction with a securities repurchase program not otherwise
prohibited hereunder, and not for purposes of speculation or taking a "market
view."
"Person" means any individual, trustee, corporation, general
partnership, limited partnership, limited liability company, joint stock
company, trust, unincorporated organization, bank, business association, firm,
joint venture, or Governmental Authority.
"Plan" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by the Borrower or any ERISA Affiliate.
"Preliminary Opening Balance Sheet" has the meaning specified in
Section 4.01(a)(viii).
"Pro Rata Share" means, with respect to each Lender, the percentage
(carried out to the ninth decimal place) of the Aggregate Commitments
represented by such Lender's Commitment, and set forth opposite the name of such
Lender on Schedule 2.01, as such share may be adjusted as contemplated herein.
"Purchase" means any transaction, or any series of related
transactions, consummated on or after the Effectiveness Date, by which the
Borrower or any of its Subsidiaries (a) acquires any ongoing business or all or
substantially all of the assets of any firm, corporation or division thereof,
whether through purchase of assets, merger or otherwise, or (b) directly or
indirectly acquires (in one transaction or as the most recent transaction in a
series of transactions) at least a majority (in number of votes) of the
securities of a corporation which have ordinary voting power for the election of
directors (other than securities having such power only by reason of the
happening of a contingency) or a majority (by percentage or voting power) of the
outstanding partnership or membership interests of a partnership or limited
liability company, respectively.
"Register" has the meaning set forth in Section 10.07(c).
"Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA, other than events for which the 30 day notice period has been waived.
"Request for Credit Extension" means (a) with respect to a Borrowing,
conversion or continuation of Loans, a Loan Notice, and (b) with respect to an
L/C Credit Extension, a Letter of Credit Application.
"Required Lenders" means, as of any date of determination, Lenders
whose Voting Percentages aggregate more than 50%.
"Responsible Officer" means the president, chief executive officer,
chief financial officer, treasurer or assistant treasurer, any executive vice
president, or controller of a Loan Party. Any document delivered hereunder that
is signed by a Responsible Officer of a Loan Party shall be conclusively
presumed to have been authorized by all necessary corporate, partnership and/or
other action on the part of such Loan Party and such Responsible Officer shall
be conclusively presumed to have acted on behalf of such Loan Party.
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc.
17. New Ceridian Credit Agreement
23
"SEC" means the Securities and Exchange Commission.
"Securitization Subsidiary" means a Subsidiary created solely for
purposes of effectuating a securitization of Permitted Receivables, the
activities and assets of which are limited solely to such purpose and assets,
and the Organization Documents of which contain customary bankruptcy -- remote
provisions.
"Senior Note Indenture" means that Indenture dated as of June 10, 1999
between Ceridian Corporation, as Issuer, and The Bank of New York, as Trustee,
relating to 7.25% Senior Notes due 2004.
"Separation" means the consummation of (i) the transfer by way of
absolute assignment and contribution by the Parent to the Borrower of all assets
and businesses of the Parent, other than those relating directly to the Arbitron
Business (the book value of which excluded assets shall not exceed as of the
Separation Date $150,000,000), and (ii) the corresponding allocation of
liabilities of the Parent as between the Parent and the Borrower, through means
of novation or cross-indemnities, pursuant to the Spin-Off Documents.
"Separation Date" means the date upon which all material aspects of the
Separation have been completed.
"Solvent" means, as to any Person at any time, that (a) the fair value
of the property of such Person is greater than the fair value of such Person's
liabilities (including disputed, contingent and unliquidated liabilities) as
such value is established and liabilities evaluated for purposes of Section
101(32) of the Bankruptcy Code and, in the alternative, for purposes of the
Uniform Fraudulent Conveyances Act (as enacted in the State of New York); (b)
the present fair saleable value of the property of such Person is not less than
the amount that will be required to pay the probable liability of such Person on
its debts as they become absolute and matured; (c) such Person is able to
realize upon its property and pay its debts and other liabilities (including
disputed, contingent and unliquidated liabilities) as they mature in the normal
course of business; (d) such Person does not intend to, and does not believe
that it will, incur debts or liabilities beyond such Person's ability to pay as
such debts and liabilities mature; and (e) such Person is not engaged in
business or a transaction, and is not about to engage in business or a
transaction, for which such Person's property would constitute unreasonably
small capital.
"Spin-Off Consummation Date" means the date upon which all material
aspects of the Spin-Off Transaction have been consummated.
"Spin-Off Deadline" means the earlier of (a) March 30, 2001 or (b) the
date occurring three Business Days after the Closing Date.
"Spin-Off Documents" means the documents set forth in Schedule 1.01(s),
each substantially in the form attached to the Form 10 or delivered to the
Administrative Agent pursuant to Article IV hereof.
"Spin-Off Transaction" means, collectively, (i) the Separation, and
(ii) the Distribution.
18. New Ceridian Credit Agreement
24
"Subsidiary" of a Person means a corporation, partnership, limited
liability company or other business entity of which a majority of the shares of
securities or other interests having ordinary voting power for the election of
directors or other governing body (other than securities or interests having
such power only by reason of the happening of a contingency) are at the time
beneficially owned, or the management of which is otherwise controlled,
directly, or indirectly through one or more intermediaries, or both, by such
Person. Unless otherwise specified, all references herein to a "Subsidiary" or
to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of the Borrower.
"Supplemental Financial Statements" means the unaudited pro forma
consolidated balance sheet of the Borrower and its Subsidiaries for the fiscal
quarter ended March 31, 2000 (giving effect to the Spin-Off Transaction) and the
related pro forma consolidated statement of income for such fiscal quarter.
"Swap Contract" means (a) any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, equity or equity index
swaps or options, bond or bond price or bond index swaps or options or forward
bond or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap transactions, floor
transactions, collar transactions, currency swap transactions, cross-currency
rate swap transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a "Master Agreement"), including
any such obligations or liabilities under any Master Agreement.
"Swap Termination Value" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a) the amount(s) determined as the
xxxx-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include any Lender).
"Synthetic Lease Obligation" means the monetary obligation of a Person
under (a) a so-called synthetic, off-balance sheet or tax retention lease, or
(b) an agreement for the use or possession of property creating obligations that
do not appear on the balance sheet of such Person but which, upon the insolvency
or bankruptcy of such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).
"Taxes" has the meaning set forth in Section 3.01(a).
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"Xxxxxxxxx Xxxxxx" means $7,500,000.
"Trust Asset GAAP Change" has the meaning set forth in Section 1.03(b).
"Type" means, with respect to a Loan, its character as a Base Rate Loan
or a Eurodollar Rate Loan.
"Unreimbursed Amount" has the meaning set forth in Section 2.03(c)(i).
"Voting Percentage" means, as to any Lender, (a) at any time when the
Commitments are in effect, such Lender's Pro Rata Share and (b) at any time
after the termination of the Commitments, the percentage (carried out to the
ninth decimal place) which (i) the sum of (A) the Outstanding Amount of such
Lender's Loans, plus (B) such Lender's Pro Rata Share of the Outstanding Amount
of L/C Obligations, then constitutes of (ii) the Outstanding Amount of all Loans
and L/C Obligations; provided, however, that if any Lender has failed to fund
any portion of the Loans, or participations in L/C Obligations required to be
funded by it hereunder, such Lender's Voting Percentage shall be deemed to be
-0-, and the respective Pro Rata Shares and Voting Percentages of the other
Lenders shall be recomputed for purposes of this definition and the definition
of "Required Lenders" without regard to such Lender's Commitment or the
outstanding amount of its Loans, and L/C Advances, as the case may be.
"Wholly-Owned Subsidiary" means any Subsidiary in which (other than
directors' qualifying shares required by law) 100% of the capital stock of each
class having ordinary voting power, and 100% of the capital stock of every other
class, in each case, at the time as of which any determination is being made, is
owned, beneficially and of record, by the Borrower, or by one or more of the
other Wholly-Owned Subsidiaries of the Borrower, or both.
1.02 OTHER INTERPRETIVE PROVISIONS.
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) (i) The words "herein" and "hereunder" and words of similar import
when used in any Loan Document shall refer to such Loan Document as a whole and
not to any particular provision thereof.
(ii) Unless otherwise specified herein, Article, Section, Exhibit
and Schedule references are to this Agreement.
(iii) The term "including" is by way of example and not limitation.
(iv) The term "documents" includes any and all instruments,
documents, agreements, certificates, notices, reports, financial
statements and other writings, however evidenced.
(c) In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including;" the words "to"
and "until" each mean "to but excluding;" and the word "through" means "to and
including."
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26
(d) Section headings herein and the other Loan Documents are included
for convenience of reference only and shall not affect the interpretation of
this Agreement or any other Loan Document.
1.03 ACCOUNTING TERMS.
(a) All accounting terms not specifically or completely defined herein
shall be construed in conformity with, and all financial data required to be
submitted pursuant to this Agreement shall be prepared in conformity with, GAAP
applied on a consistent basis, as in effect from time to time, applied in a
manner consistent with that used in preparing the Audited Financial Statements,
except as otherwise specifically prescribed herein.
(b) Notwithstanding the preceding subsection (a), if due to a change in
GAAP arising after the Effectiveness Date the Borrower is required to report as
assets on its balance sheet third party payroll deposit assets held by the
Borrower as trustee in the Ordinary Course of Business of its payroll deposit
business (such event, "Trust Asset GAAP Change"), then such assets and the
corresponding liabilities (to the extent not in excess of such assets) shall not
be deemed assets or liabilities, respectively, for purposes of the covenants
contained in Sections 7.04, 7.05, 7.09 or 7.10.
(c) If at any time any change in GAAP would affect the computation of
any financial ratio or requirement set forth in any Loan Document, and either
the Borrower or the Required Lenders shall so request, the Administrative Agent,
the Lenders and the Borrower shall negotiate in good faith to amend such ratio
or requirement to preserve the original intent thereof in light of such change
in GAAP (subject to the approval of the Required Lenders); provided that, until
so amended, (a) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (b) the Borrower shall
provide to the Administrative Agent and the Lenders financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP.
1.04 ROUNDING. Any financial ratios required to be maintained by the
Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).
1.05 REFERENCES TO AGREEMENTS AND LAWS. Unless otherwise expressly
provided herein, (a) references to agreements (including the Loan Documents) and
other contractual instruments shall be deemed to include all subsequent
amendments, restatements, extensions, supplements and other modifications
thereto, but only to the extent that such amendments, restatements, extensions,
supplements and other modifications are not prohibited by any Loan Document; and
(b) references to any Law shall include all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting such Law.
21. New Ceridian Credit Agreement
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ARTICLE II.
THE COMMITMENTS AND CREDIT EXTENSIONS
2.01 LOANS. Subject to the terms and conditions set forth herein, each
Lender severally agrees to make loans (each such loan, a "Loan") to the Borrower
from time to time on any Business Day during the period from the Closing Date to
the Maturity Date, in an aggregate amount not to exceed at any time outstanding
the amount of such Lender's Commitment; provided, however, that after giving
effect to any Borrowing, (i) the aggregate Outstanding Amount of all Loans and
L/C Obligations shall not exceed the Aggregate Commitments, and (ii) the
aggregate Outstanding Amount of the Loans of any Lender, plus such Lender's Pro
Rata Share of the Outstanding Amount of all L/C Obligations, shall not exceed
such Lender's Commitment. Within the limits of each Lender's Commitment, and
subject to the other terms and conditions hereof, the Borrower may borrow under
this Section 2.01, prepay under Section 2.04, and reborrow under this Section
2.01. Loans may be Base Rate Loans or Eurodollar Rate Loans, as further provided
herein.
2.02 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF LOANS.
(a) Each Borrowing, each conversion of Loans from one Type to the
other, and each continuation of Loans as the same Type shall be made upon the
Borrower's irrevocable notice to the Administrative Agent, which may be given by
telephone. Each such notice must be received by the Administrative Agent not
later than 10:00 a.m., Minneapolis time, (i) three Business Days prior to the
requested date of any Borrowing of, conversion to, or continuation of Eurodollar
Rate Loans, or of any conversion of Eurodollar Rate Loans to Base Rate Loans,
and (ii) on the requested date of any Borrowing of Base Rate Loans. Each such
telephonic notice must be confirmed promptly by delivery to the Administrative
Agent of a written Loan Notice, appropriately completed and signed by a
Responsible Officer of the Borrower. Each Borrowing of, conversion to, or
continuation of Eurodollar Rate Loans shall be in a principal amount of
$5,000,000 or a whole multiple of $1,000,000 in excess thereof. Each Borrowing
of or conversion to Base Rate Loans shall be in a principal amount of $1,000,000
or a whole multiple of $500,000 in excess thereof. Each Loan Notice (whether
telephonic or written) shall specify (i) whether the Borrower is requesting a
Borrowing, a conversion of Loans from one Type to the other, or a continuation
of Loans as the same Type, (ii) the requested date of the Borrowing, conversion
or continuation, as the case may be (which shall be a Business Day), (iii) the
principal amount of Loans to be borrowed, converted or continued, (iv) the Type
of Loans to be borrowed or to which existing Loans are to be converted, and (v)
if applicable, the duration of the Interest Period with respect thereto. If the
Borrower fails to specify a Type of Loan in a Loan Notice or if the Borrower
fails to give a timely notice requesting a conversion or continuation, then the
applicable Loans shall be made or continued as, or converted to, Base Rate
Loans. Any such automatic conversion to Base Rate Loans shall be effective as of
the last day of the Interest Period then in effect with respect to the
applicable Eurodollar Rate Loans. If the Borrower requests a Borrowing of,
conversion to, or continuation of Eurodollar Rate Loans in any such Loan Notice,
but fails to specify an Interest Period, it will be deemed to have specified an
Interest Period of one month.
(b) Following receipt of a Loan Notice, the Administrative Agent shall
promptly notify each Lender of its Pro Rata Share of the applicable Loans, and
if no timely notice of a
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28
conversion or continuation is provided by the Borrower, the Administrative Agent
shall notify each Lender of the details of any automatic conversion to Base Rate
Loans described in the preceding subsection. In the case of a Borrowing, each
Lender shall make the amount of its Loan available to the Administrative Agent
in immediately available funds at the Administrative Agent's Office not later
than 1:00 p.m., Minneapolis time, on the Business Day specified in the
applicable Loan Notice. Upon satisfaction of the applicable conditions set forth
in Section 4.03 (and, if such Borrowing is the initial Credit Extension, Section
4.02), the Administrative Agent shall make all funds so received available to
the Borrower in like funds as received by the Administrative Agent either by (i)
crediting the account of the Borrower on the books of Bank of America with the
amount of such funds or (ii) wire transfer of such funds, in each case in
accordance with instructions provided to the Administrative Agent by the
Borrower; provided, however, that if, on the date of the Borrowing there are L/C
Borrowings outstanding, then the proceeds of such Borrowing shall be applied,
first, to the payment in full of any such L/C Borrowings, and second, to the
Borrower as provided above.
(c) Except as otherwise provided herein, a Eurodollar Rate Loan may be
continued or converted only on the last day of the Interest Period for such
Eurodollar Rate Loan. During the existence of a Default or Event of Default, no
Loans may be requested as, converted to or continued as Eurodollar Rate Loans
without the consent of the Required Lenders, and the Required Lenders may demand
that any or all of the then outstanding Eurodollar Rate Loans be converted
immediately to Base Rate Loans.
(d) The Administrative Agent shall promptly notify the Borrower and the
Lenders of the interest rate applicable to any Eurodollar Rate Loan upon
determination of such interest rate. The determination of the Eurodollar Rate by
the Administrative Agent shall be conclusive in the absence of manifest error.
The Administrative Agent shall notify the Borrower and the Lenders of any change
in Bank of America's prime rate used in determining the Base Rate promptly
following the public announcement of such change.
(e) After giving effect to all Borrowings, all conversions of Loans
from one Type to the other, and all continuations of Loans as the same Type,
there shall not be more than ten Interest Periods in effect with respect to
Loans.
2.03 LETTERS OF CREDIT.
(a) The Letter of Credit Commitment.
(i) Subject to the terms and conditions set forth herein, (A)
the L/C Issuer agrees, in reliance upon the agreements of the other
Lenders set forth in this Section 2.03, (1) from time to time on any
Business Day during the period from the Closing Date until the Letter
of Credit Backstop Date, to issue Letters of Credit for the account of
the Borrower, and to amend or renew Letters of Credit previously issued
by it, in accordance with subsection (b) below, and (2) to honor drafts
under the Letters of Credit; and (B) the Lenders severally agree to
participate in Letters of Credit issued for the account of the
Borrower; provided that the L/C Issuer shall not be obligated to make
any L/C Credit Extension with respect to any Letter of Credit, and no
Lender shall be obligated to participate in, any Letter of Credit if as
of the date of such L/C Credit Extension, (x) the
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29
Outstanding Amount of all L/C Obligations and all Loans would exceed
the Aggregate Commitments, (y) the aggregate Outstanding Amount of the
Loans of any Lender, plus such Lender's Pro Rata Share of the
Outstanding Amount of all L/C Obligations, would exceed such Lender's
Commitment, or (z) the Outstanding Amount of the L/C Obligations would
exceed the Letter of Credit Sublimit. Within the foregoing limits, and
subject to the terms and conditions hereof, the Borrower's ability to
obtain Letters of Credit shall be fully revolving, and accordingly the
Borrower may, during the foregoing period, obtain Letters of Credit to
replace Letters of Credit that have expired or that have been drawn
upon and reimbursed. Upon the execution of an assignment and assumption
agreement by the Borrower and the Parent, the Existing Letter of Credit
shall be deemed to have been issued pursuant hereto, and from and after
the Closing Date shall be subject to and governed by the terms and
conditions hereof.
(ii) The L/C Issuer shall be under no obligation to issue any
Letter of Credit if:
(A) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin
or restrain the L/C Issuer from issuing such Letter of Credit,
or any Law applicable to the L/C Issuer or any request or
directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over the L/C Issuer
shall prohibit, or request that the L/C Issuer refrain from,
the issuance of letters of credit generally or such Letter of
Credit in particular or shall impose upon the L/C Issuer with
respect to such Letter of Credit any restriction, reserve or
capital requirement (for which the L/C Issuer is not otherwise
compensated hereunder) not in effect on the Closing Date, or
shall impose upon the L/C Issuer any unreimbursed loss, cost
or expense which was not applicable on the Closing Date and
which the L/C Issuer in good xxxxx xxxxx material to it;
(B) subject to Section 2.03(b)(iii), the expiry date
of such requested Letter of Credit would occur more than
twelve months after the date of issuance or last renewal,
unless the Required Lenders have approved such expiry date;
(C) the expiry date of such requested Letter of
Credit would occur after the Letter of Credit Backstop Date,
unless all the Lenders have approved such expiry date;
(D) the issuance of such Letter of Credit would
violate one or more generally applicable policies of the L/C
Issuer; or
(E) such Letter of Credit is in a face amount less
than $500,000, or is to be denominated in a currency other
than Dollars.
(iii) The L/C Issuer shall be under no obligation to amend any
Letter of Credit if (A) the L/C Issuer would have no obligation at such
time to issue such Letter of Credit in its amended form under the terms
hereof, or (B) the beneficiary of such Letter of Credit does not accept
the proposed amendment to such Letter of Credit.
24. New Ceridian Credit Agreement
30
(b) Procedures for Issuance and Amendment of Letters of Credit;
Evergreen Letters of Credit.
(i) Each Letter of Credit shall be issued or amended, as the
case may be, upon the request of the Borrower delivered to the L/C
Issuer (with a copy to the Administrative Agent) in the form of a
Letter of Credit Application, appropriately completed and signed by a
Responsible Officer of the Borrower. Such Letter of Credit Application
must be received by the L/C Issuer and the Administrative Agent not
later than 10:00 a.m., Minneapolis time, at least two Business Days (or
such later date and time as the L/C Issuer may agree in a particular
instance in its sole discretion) prior to the proposed issuance date or
date of amendment, as the case may be. In the case of a request for an
initial issuance of a Letter of Credit, such Letter of Credit
Application shall specify in form and detail satisfactory to the L/C
Issuer: (A) the proposed issuance date of the requested Letter of
Credit (which shall be a Business Day); (B) the amount thereof; (C) the
expiry date thereof; (D) the name and address of the beneficiary
thereof; (E) the documents to be presented by such beneficiary in case
of any drawing thereunder; (F) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; and
(G) such other matters as the L/C Issuer may require. In the case of a
request for an amendment of any outstanding Letter of Credit, such
Letter of Credit Application shall specify in form and detail
satisfactory to the L/C Issuer (I) the Letter of Credit to be amended;
(II) the proposed date of amendment thereof (which shall be a Business
Day); (III) the nature of the proposed amendment; and (IV) such other
matters as the L/C Issuer may require.
(ii) Promptly after receipt of any Letter of Credit
Application, the L/C Issuer will confirm with the Administrative Agent
(by telephone or in writing) that the Administrative Agent has received
a copy of such Letter of Credit Application from the Borrower and, if
not, the L/C Issuer will provide the Administrative Agent with a copy
thereof. Upon receipt by the L/C Issuer of confirmation from the
Administrative Agent that the requested issuance or amendment is
permitted in accordance with the terms hereof, then, subject to the
terms and conditions hereof, the L/C Issuer shall, on the requested
date, issue a Letter of Credit for the account of the Borrower or enter
into the applicable amendment, as the case may be, in each case in
accordance with the L/C Issuer's usual and customary business
practices. Immediately upon the issuance of each Letter of Credit, each
Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the L/C Issuer a participation in such Letter
of Credit in an amount equal to the product of such Lender's Pro Rata
Share times the amount of such Letter of Credit.
(iii) If the Borrower so requests in any applicable Letter of
Credit Application, the L/C Issuer may, in it sole and absolute
discretion, agree to issue a Letter of Credit that has automatic
renewal provisions (each, an "Evergreen Letter of Credit"); provided
that any such Evergreen Letter of Credit must permit the L/C Issuer to
prevent any such renewal at least once in each twelve-month period
(commencing with the date of issuance of such Letter of Credit) by
giving prior notice to the beneficiary thereof not later than a day
(the "Nonrenewal Notice Date") in each such twelve-month period to be
agreed upon at the time such Letter of Credit is issued. Unless
otherwise directed by the L/C Issuer,
25. New Ceridian Credit Agreement
31
the Borrower shall not be required to make a specific request to the
L/C Issuer for any such renewal. Once an Evergreen Letter of Credit has
been issued, the Lenders shall be deemed to have authorized (but may
not require) the L/C Issuer to permit the renewal of such Letter of
Credit at any time to a date not later than the Letter of Credit
Backstop Date; provided, however, that the L/C Issuer shall not permit
any such renewal if (A) the L/C Issuer would have no obligation at such
time to issue such Letter of Credit in its renewed form under the terms
hereof, or (B) it has received notice (which may be by telephone or in
writing) on or before the Business Day immediately preceding the
Nonrenewal Notice Date (1) from the Administrative Agent that the
Required Lenders have elected not to permit such renewal or (2) from
the Administrative Agent, any Lender or the Borrower that one or more
of the applicable conditions specified in Section 4.03 is not then
satisfied. Notwithstanding anything to the contrary contained herein,
the L/C Issuer shall have no obligation to permit the renewal of any
Evergreen Letter of Credit at any time.
(iv) Promptly after its delivery of any Letter of Credit or
any amendment to a Letter of Credit to an advising bank with respect
thereto or to the beneficiary thereof, the L/C Issuer will also deliver
to the Borrower and the Administrative Agent a true and complete copy
of such Letter of Credit or amendment.
(c) Drawings and Reimbursements; Funding of Participations.
(i) Upon any drawing under any Letter of Credit, the L/C
Issuer shall notify the Borrower and the Administrative Agent thereof.
Not later than 10:00 a.m., Minneapolis time, on the date of any payment
by the L/C Issuer under a Letter of Credit (each such date, an "Honor
Date"), the Borrower shall reimburse the L/C Issuer through the
Administrative Agent in an amount equal to the amount of such drawing.
If the Borrower fails to so reimburse the L/C Issuer by such time, the
Administrative Agent shall promptly notify each Lender of the Honor
Date, the amount of the unreimbursed drawing (the "Unreimbursed
Amount"), and such Lender's Pro Rata Share thereof. In such event, the
Borrower shall be deemed to have requested a Borrowing of Base Rate
Loans to be disbursed on the Honor Date in an amount equal to the
Unreimbursed Amount, without regard to the minimum and multiples
specified in Section 2.02 for the principal amount of Base Rate Loans,
but subject to the amount of the unutilized portion of the Aggregate
Commitments and the conditions set forth in Section 4.03 (other than
the delivery of a Loan Notice). Any notice given by the L/C Issuer or
the Administrative Agent pursuant to this Section 2.03(c)(i) may be
given by telephone if immediately confirmed in writing; provided that
the lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice.
(ii) Each Lender (including the Lender acting as L/C Issuer)
shall upon any notice pursuant to Section 2.03(c)(i) make funds
available to the Administrative Agent for the account of the L/C Issuer
at the Administrative Agent's Office in an amount equal to its Pro Rata
Share of the Unreimbursed Amount not later than 1:00 p.m., Minneapolis
time, on the Business Day specified in such notice by the
Administrative Agent, whereupon, subject to the provisions of Section
2.03(c)(iii), each Lender that so makes
26. New Ceridian Credit Agreement
32
funds available shall be deemed to have made a Base Rate Loan to the
Borrower in such amount. The Administrative Agent shall remit the funds
so received to the L/C Issuer.
(iii) With respect to any Unreimbursed Amount that is not
fully refinanced by a Borrowing of Base Rate Loans because the
conditions set forth in Section 4.03 cannot be satisfied or for any
other reason, the Borrower shall be deemed to have incurred from the
L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount
that is not so refinanced, which L/C Borrowing shall be due and payable
on demand (together with interest) and shall bear interest at the
Default Rate. In such event, each Lender's payment to the
Administrative Agent for the account of the L/C Issuer pursuant to
Section 2.03(c)(ii) shall be deemed payment in respect of its
participation in such L/C Borrowing and shall constitute an L/C Advance
from such Lender in satisfaction of its participation obligation under
this Section 2.03.
(iv) Until each Lender funds its Loan or L/C Advance pursuant
to this Section 2.03(c) to reimburse the L/C Issuer for any amount
drawn under any Letter of Credit, interest in respect of such Lender's
Pro Rata Share of such amount shall be solely for the account of the
L/C Issuer.
(v) Each Lender's obligation to make Loans or L/C Advances to
reimburse the L/C Issuer for amounts drawn under Letters of Credit, as
contemplated by this Section 2.03(c), shall be absolute and
unconditional and shall not be affected by any circumstance, including
(A) any set-off, counterclaim, recoupment, defense or other right which
such Lender may have against the L/C Issuer, the Borrower or any other
Person for any reason whatsoever; (B) the occurrence or continuance of
a Default or Event of Default, or (C) any other occurrence, event or
condition, whether or not similar to any of the foregoing. Any such
reimbursement shall not relieve or otherwise impair the obligation of
the Borrower to reimburse the L/C Issuer for the amount of any payment
made by the L/C Issuer under any Letter of Credit, together with
interest as provided herein.
(vi) If any Lender fails to make available to the
Administrative Agent for the account of the L/C Issuer any amount
required to be paid by such Lender pursuant to the foregoing provisions
of this Section 2.03(c) by the time specified in Section 2.03(c)(ii),
the L/C Issuer shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest
thereon for the period from the date such payment is required to the
date on which such payment is immediately available to the L/C Issuer
at a rate per annum equal to the Federal Funds Rate from time to time
in effect. A certificate of the L/C Issuer submitted to any Lender
(through the Administrative Agent) with respect to any amounts owing
under this clause (vi) shall be conclusive absent manifest error.
(d) Repayment of Participations.
(i) At any time after the L/C Issuer has made a payment under
any Letter of Credit and has received from any Lender such Lender's L/C
Advance in respect of such payment in accordance with Section 2.03(c),
if the Administrative Agent receives for the
27. New Ceridian Credit Agreement
33
account of the L/C Issuer any payment related to such Letter of Credit
(whether directly from the Borrower or otherwise, including proceeds of
Cash Collateral applied thereto by the Administrative Agent), or any
payment of interest thereon, the Administrative Agent will distribute
to such Lender its Pro Rata Share thereof in the same funds as those
received by the Administrative Agent.
(ii) If any payment received by the Administrative Agent for
the account of the L/C Issuer pursuant to Section 2.03(c)(i) is
required to be returned, each Lender shall pay to the Administrative
Agent for the account of the L/C Issuer its Pro Rata Share thereof on
demand of the Administrative Agent, plus interest thereon from the date
of such demand to the date such amount is returned by such Lender, at a
rate per annum equal to the Federal Funds Rate from time to time in
effect.
(e) Obligations Absolute. The obligation of the Borrower to reimburse
the L/C Issuer for each drawing under each Letter of Credit, and to repay each
L/C Borrowing and each drawing under a Letter of Credit that is refinanced by a
Borrowing of Loans, shall be absolute, unconditional and irrevocable, and shall
be paid strictly in accordance with the terms of this Agreement under all
circumstances, including the following:
(i) any lack of validity or enforceability of such Letter of
Credit, this Agreement, or any other agreement or instrument relating
thereto;
(ii) the existence of any claim, counterclaim, set-off,
defense or other right that the Borrower may have at any time against
any beneficiary or any transferee of such Letter of Credit (or any
Person for whom any such beneficiary or any such transferee may be
acting), the L/C Issuer or any other Person, whether in connection with
this Agreement, the transactions contemplated hereby or such Letter of
Credit or any agreement or instrument relating thereto, or any
unrelated transaction;
(iii) any draft, demand, certificate or other document
presented under such Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a
drawing under such Letter of Credit;
(iv) any payment by the L/C Issuer under such Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of such Letter of Credit; or any payment made by
the L/C Issuer under such Letter of Credit to any Person purporting to
be a trustee in bankruptcy, debtor-in-possession, assignee for the
benefit of creditors, liquidator, receiver or other representative of
or successor to any beneficiary or any transferee of such Letter of
Credit, including any arising in connection with any proceeding under
any Debtor Relief Law; or
(v) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing, including any other circumstance
that might otherwise constitute a defense available to, or a discharge
of, the Borrower.
28. New Ceridian Credit Agreement
34
The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower's instructions or other irregularity, the
Borrower will promptly notify the L/C Issuer. The Borrower shall be conclusively
deemed to have waived any such claim against the L/C Issuer and its
correspondents unless such notice is given as aforesaid.
(f) Role of L/C Issuer. Each Lender and the Borrower agree that, in
paying any drawing under a Letter of Credit, the L/C Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document, except to the extent of
the L/C Issuer's gross negligence or willful misconduct. No Agent-Related Person
nor any of the respective correspondents, participants or assignees of the L/C
Issuer shall be liable to any Lender for (i) any action taken or omitted in
connection herewith at the request or with the approval of the Lenders or the
Required Lenders, as applicable; (ii) any action taken or omitted in the absence
of gross negligence or willful misconduct; or (iii) the due execution,
effectiveness, validity or enforceability of any document or instrument related
to any Letter of Credit or Letter of Credit Application. The Borrower hereby
assumes all risks of the acts or omissions of any beneficiary or transferee with
respect to its use of any Letter of Credit; provided, however, that this
assumption is not intended to, and shall not, preclude the Borrower's pursuing
such rights and remedies as it may have against the beneficiary or transferee at
law or under any other agreement. No Agent-Related Person, nor any of the
respective correspondents, participants or assignees of the L/C Issuer, shall be
liable or responsible for any of the matters described in clauses (i) through
(v) of Section 2.03(e); provided, however, that anything in such clauses to the
contrary notwithstanding, the Borrower may have a claim against the L/C Issuer,
and the L/C Issuer may be liable to the Borrower, to the extent, but only to the
extent, of any direct, as opposed to consequential or exemplary, damages
suffered by the Borrower which the Borrower proves were caused by the L/C
Issuer's willful misconduct or gross negligence or the L/C Issuer's willful
failure to pay under any Letter of Credit after the presentation to it by the
beneficiary of a sight draft and certificate(s) strictly complying with the
terms and conditions of a Letter of Credit. In furtherance and not in limitation
of the foregoing, the L/C Issuer may accept documents that appear on their face
to be in order, without responsibility for further investigation, regardless of
any notice or information to the contrary, and the L/C Issuer shall not be
responsible for the validity or sufficiency 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.
(g) Cash Collateral. Upon the request of the Administrative Agent
(which shall be made at the direction of the L/C Issuer or the Required
Lenders), (i) if the L/C Issuer has honored any full or partial drawing request
under any Letter of Credit and such drawing has resulted in an L/C Borrowing, or
(ii) if, as of the Letter of Credit Backstop Date, any Letter of Credit may for
any reason remain outstanding and partially or wholly undrawn, the Borrower
shall immediately Cash Collateralize the then Outstanding Amount of all L/C
Obligations (in an amount equal to such Outstanding Amount) until (x) in the
case of clause (i) above, such L/C Borrowing is paid pursuant to a Borrowing or
otherwise, or (y) in the case of clause (ii) above, such Letter of Credit
expires without being drawn.
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35
(h) Applicability of ISP98 and UCP. Unless otherwise expressly agreed
by the L/C Issuer and the Borrower when a Letter of Credit is issued (including
any such agreement applicable to an Existing Letter of Credit), the rules of the
"International Standby Practices 1998" published by the Institute of
International Banking Law & Practice (or such later version thereof as may be in
effect at the time of issuance) shall apply to each Letter of Credit.
(i) Letter of Credit Fees. The Borrower shall pay to the Administrative
Agent for the account of each Lender in accordance with its Pro Rata Share a
Letter of Credit fee for each Letter of Credit equal to the Applicable Rate
times the actual daily maximum amount available to be drawn under each Letter of
Credit. Such fee for each Letter of Credit shall be due and payable on the last
Business Day of each March, June, September and December, commencing with the
first such date to occur after the issuance of such Letter of Credit, and on the
Letter of Credit Backstop Date. If there is any change in the Applicable Rate
during any quarter, the actual daily amount of each Letter of Credit shall be
computed and multiplied by the Applicable Rate separately for each period during
such quarter that such Applicable Rate was in effect.
(j) Fronting Fee and Documentary and Processing Charges Payable to L/C
Issuer. The Borrower shall pay directly to the L/C Issuer for its own account a
fronting fee in an amount with respect to each Letter of Credit equal to the
percent specified in the Agent/Arranger Fee Letter on the maximum amount
available to be drawn thereunder, due and payable on the issuance of such Letter
of Credit. In addition, the Borrower shall pay directly to the L/C Issuer for
its own account the customary issuance, presentation, amendment and other
processing fees, and other standard costs and charges, of the L/C Issuer
relating to letters of credit as from time to time in effect. Such fees and
charges are due and payable on demand and are nonrefundable.
(k) Conflict with Letter of Credit Application. In the event of any
conflict between the terms hereof and the terms of any Letter of Credit
Application, the terms hereof shall control.
2.04 PREPAYMENTS.
(a) The Borrower may, upon notice to the Administrative Agent, at any
time or from time to time, voluntarily prepay Loans in whole or in part without
premium or penalty; provided that (i) such notice must be received by the
Administrative Agent not later than 11:00 a.m., Minneapolis time, (A) three
Business Days prior to any date of prepayment of Eurodollar Rate Loans, and (B)
on the date of prepayment of Base Rate Loans; (ii) any prepayment of Eurodollar
Rate Loans shall be in a principal amount of $5,000,000 or a whole multiple of
$1,000,000 in excess thereof; and (iii) any prepayment of Base Rate Loans shall
be in a principal amount of $1,000,000 or a whole multiple of $500,000 in excess
thereof. Each such notice shall specify the date and amount of such prepayment
and the Type(s) of Loans to be prepaid. The Administrative Agent will promptly
notify each Lender of its receipt of each such notice, and of such Lender's Pro
Rata Share of such prepayment. If such notice is given by the Borrower, the
Borrower shall make such prepayment and the payment amount specified in such
notice shall be due and payable on the date specified therein. Any prepayment of
a Eurodollar Rate Loan shall be accompanied by all accrued interest thereon,
together with any additional amounts required pursuant to Section 3.05. Each
such prepayment shall be applied to the Loans of the Lenders in accordance with
their respective Pro Rata Shares.
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36
(b) If for any reason the Outstanding Amount of all Loans and L/C
Obligations at any time exceeds the Aggregate Commitments then in effect, the
Borrower shall immediately prepay Loans and/or Cash Collateralize the L/C
Obligations in an aggregate amount equal to such excess.
2.05 REDUCTION OR TERMINATION OF COMMITMENTS. The Borrower may, upon
notice to the Administrative Agent, terminate the Aggregate Commitments, or
permanently reduce the Aggregate Commitments to an amount not less than the then
Outstanding Amount of all Loans and L/C Obligations; provided that (i) any such
notice shall be received by the Administrative Agent not later than 11:00 a.m.,
three Business Days prior to the date of termination or reduction, and (ii) any
such partial reduction shall be in an aggregate amount of $10,000,000 or any
whole multiple of $1,000,000 in excess thereof. The Administrative Agent shall
promptly notify the Lenders of any such notice of reduction or termination of
the Aggregate Commitments. Once reduced in accordance with this Section, the
Commitments may not be increased. Any reduction of the Aggregate Commitments
shall be applied to the Commitment of each Lender according to its Pro Rata
Share. All commitment and utilization fees accrued until the effective date of
any termination of the Aggregate Commitments shall be paid on the effective date
of such termination.
2.06 REPAYMENT OF LOANS. The Borrower shall repay to the Lenders on the
Maturity Date the aggregate principal amount of Loans outstanding on such date.
2.07 INTEREST.
(a) Subject to the provisions of subsection (b) below, (i) each
Eurodollar Rate Loan shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the Eurodollar
Rate for such Interest Period plus the Applicable Rate; and (ii) each Base Rate
Loan shall bear interest on the outstanding principal amount thereof from the
applicable borrowing date at a rate per annum equal to the Base Rate plus the
Applicable Rate.
(b) While any Event of Default exists or after acceleration, the
Borrower shall pay interest on the principal amount of all outstanding
Obligations at a fluctuating interest rate per annum at all times equal to the
Default Rate, to the fullest extent permitted by applicable Law. Accrued and
unpaid interest on past due amounts (including interest on past due interest)
shall be due and payable upon demand.
(c) Interest on each Loan shall be due and payable in arrears on each
Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
2.08 FEES. In addition to certain fees described in subsections (i) and
(j) of Section 2.03:
(a) Commitment Fee. The Borrower shall pay to the Administrative Agent
for the account of each Lender in accordance with its Pro Rata Share, a
commitment fee equal to the Applicable Rate times the actual daily amount by
which the Aggregate Commitments exceed the
31. New Ceridian Credit Agreement
37
sum of (i) the Outstanding Amount of Loans and (ii) the Outstanding Amount of
L/C Obligations. The commitment fee shall accrue at all times from the
Effectiveness Date until the Maturity Date and shall be due and payable
quarterly in arrears on the last Business Day of each March, June, September and
December, commencing with the first such date to occur after the Effectiveness
Date, and on the Maturity Date. The commitment fee shall be calculated quarterly
in arrears, and if there is any change in the Applicable Rate during any
quarter, the actual daily amount shall be computed and multiplied by the
Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect. The commitment fee shall accrue at all times,
including at any time during which one or more of the conditions in Article IV
is not met.
(b) Utilization Fee. The Borrower shall pay to the Administrative Agent
for the account of each Lender in accordance with its Pro Rata Share, a
utilization fee of 0.125% times the actual daily aggregate Outstanding Amount of
Loans and L/C Obligations on each day that such aggregate Outstanding Amount
exceeds 50% of the Aggregate Commitments. The utilization fee shall be due and
payable quarterly in arrears on the last Business Day of each March, June,
September and December, commencing with the first such date to occur after the
Effectiveness Date, and on the Maturity Date. The utilization fee shall be
calculated quarterly in arrears. The utilization fee shall accrue at all times,
including at any time during which one or more of the conditions in Article IV
is not met.
(c) Arrangement and Agency Fees. The Borrower shall pay an arrangement
fee to the Arranger for the Arranger's own account, and shall pay an agency fee
to the Administrative Agent for the Administrative Agent's own account, in the
amounts and at the times specified in the letter agreement, dated August 25,
2000 (the "Agent/Arranger Fee Letter"), among the Borrower, the Parent, the
Arranger and the Administrative Agent. Such fees shall be fully earned when paid
and shall be nonrefundable for any reason whatsoever.
(d) Lenders' Upfront Fee. On the Effectiveness Date, the Borrower shall
pay to the Administrative Agent, for the account of the Lenders in accordance
with their respective Pro Rata Shares, an upfront fee in an amount set forth in
the Agent/Arranger Fee Letter. Such upfront fees are for the credit facilities
committed by the Lenders under this Agreement and are fully earned on the date
paid. The upfront fee paid to each Lender is solely for its own account and is
nonrefundable for any reason whatsoever.
2.09 COMPUTATION OF INTEREST AND FEES. Computation of interest on Base
Rate Loans shall be calculated on the basis of a year of 365 or 366 days, as the
case may be, and the actual number of days elapsed. Computation of all other
types of interest and all fees shall be calculated on the basis of a year of 360
days and the actual number of days elapsed, which results in a higher yield to
the payee thereof than a method based on a year of 365 or 366 days. Interest
shall accrue on each Loan for the day on which the Loan is made, and shall not
accrue on a Loan, or any portion thereof, for the day on which the Loan or such
portion is paid, provided that any Loan that is repaid on the same day on which
it is made shall bear interest for one day.
2.10 EVIDENCE OF DEBT.
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38
(a) The Credit Extensions made by each Lender shall be evidenced by one
or more accounts or records maintained by such Lender and by the Administrative
Agent in the ordinary course of business. The accounts or records maintained by
the Administrative Agent and each Lender shall be conclusive absent manifest
error of the amount of the Credit Extensions made by the Lenders to the Borrower
and the interest and payments thereon. Any failure so to record or any error in
doing so shall not, however, limit or otherwise affect the obligation of the
Borrower hereunder to pay any amount owing with respect to the Loans and L/C
Obligations. In the event of any conflict between the accounts and records
maintained by any Lender and the accounts and records of the Administrative
Agent in respect of such matters, the accounts and records of such Lender shall
control. Upon the request of any Lender made through the Administrative Agent,
such Lender's Loans may be evidenced by a Loan Note, in addition to such
accounts or records. Each Lender may attach schedules to its Loan Note(s) and
endorse thereon the date, Type (if applicable), amount and maturity of the
applicable Loans and payments with respect thereto.
(b) In addition to the accounts and records referred to in subsection
(a), each Lender and the Administrative Agent shall maintain in accordance with
its usual practice accounts or records evidencing the purchases and sales by
such Lender of participations in Letters of Credit. In the event of any conflict
between the accounts and records maintained by the Administrative Agent and the
accounts and records of any Lender in respect of such matters, the accounts and
records of the Administrative Agent shall control.
2.11 PAYMENTS GENERALLY.
(a) All payments to be made by the Borrower shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff.
Except as otherwise expressly provided herein, all payments by the Borrower
hereunder shall be made to the Administrative Agent, for the account of the
respective Lenders to which such payment is owed, at the Administrative Agent's
Office in Dollars and in immediately available funds not later than 1:00 p.m.
Minneapolis time, on the date specified herein. The Administrative Agent will
promptly distribute to each Lender its Pro Rata Share (or other applicable share
as provided herein) of such payment in like funds as received by wire transfer
to such Lender's Lending Office. All payments received by the Administrative
Agent after 1:00 p.m. Minneapolis time shall be deemed received on the next
succeeding Business Day and any applicable interest or fee shall continue to
accrue.
(b) Subject to the definition of "Interest Period," if any payment to
be made by the Borrower shall come due on a day other than a Business Day,
payment shall be made on the next following Business Day, and such extension of
time shall be reflected in computing interest or fees, as the case may be.
(c) If at any time insufficient funds are received by and available to
the Administrative Agent to pay fully all amounts of principal, L/C Borrowings,
interest and fees then due hereunder, such funds shall be applied (i) first,
toward costs and expenses (including Attorney Costs and amounts payable under
Article III) incurred by the Administrative Agent and each Lender, (ii) second,
toward repayment of interest and fees then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of interest and fees
then due to such parties, and (iii) third, toward repayment of principal and L/C
Borrowings then due
33. New Ceridian Credit Agreement
39
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of principal and L/C Borrowings then due to such parties.
(d) Unless the Borrower or any Lender has notified the Administrative
Agent prior to the date any payment is required to be made by it to the
Administrative Agent hereunder, that the Borrower or such Lender, as the case
may be, will not make such payment, the Administrative Agent may assume that the
Borrower or such Lender, as the case may be, has timely made such payment and
may (but shall not be so required to), in reliance thereon, make available a
corresponding amount to the Person entitled thereto. If and to the extent that
such payment was not in fact made to the Administrative Agent in immediately
available funds, then:
(i) if the Borrower failed to make such payment, each Lender
shall forthwith on demand repay to the Administrative Agent the portion
of such assumed payment that was made available to such Lender in
immediately available funds, together with interest thereon in respect
of each day from and including the date such amount was made available
by the Administrative Agent to such Lender to the date such amount is
repaid to the Administrative Agent in immediately available funds, at
the Federal Funds Rate from time to time in effect; and
(ii) if any Lender failed to make such payment, such Lender
shall forthwith on demand pay to the Administrative Agent the amount
thereof in immediately available funds, together with interest thereon
for the period from the date such amount was made available by the
Administrative Agent to the Borrower to the date such amount is
recovered by the Administrative Agent (the "Compensation Period") at a
rate per annum equal to the Federal Funds Rate from time to time in
effect. If such Lender pays such amount to the Administrative Agent,
then such amount shall constitute such Lender's Loan, included in the
applicable Borrowing. If such Lender does not pay such amount forthwith
upon the Administrative Agent's demand therefor, the Administrative
Agent may make a demand therefor upon the Borrower, and the Borrower
shall pay such amount to the Administrative Agent, together with
interest thereon for the Compensation Period at a rate per annum equal
to the rate of interest applicable to the applicable Borrowing. Nothing
herein shall be deemed to relieve any Lender from its obligation to
fulfill its Commitment or to prejudice any rights which the
Administrative Agent or the Borrower may have against any Lender as a
result of any default by such Lender hereunder.
A notice of the Administrative Agent to any Lender with respect to any
amount owing under this subsection (d) shall be conclusive, absent manifest
error.
(e) If any Lender makes available to the Administrative Agent funds for
any Loan to be made by such Lender as provided in the foregoing provisions of
this Article II, and the conditions to the applicable Credit Extension set forth
in Article IV are not satisfied or waived in accordance with the terms hereof,
the Administrative Agent shall return such funds (in like funds as received from
such Lender) to such Lender, without interest.
(f) The obligations of the Lenders hereunder to make Loans and to fund
participations in Letters of Credit are several and not joint. The failure of
any Lender to make
34. New Ceridian Credit Agreement
40
any Loan or to fund any such participation on any date required hereunder shall
not relieve any other Lender of its corresponding obligation to do so on such
date, and no Lender shall be responsible for the failure of any other Lender to
so make its Loan or purchase its participation.
(g) Nothing herein shall be deemed to obligate any Lender to obtain the
funds for any Loan in any particular place or manner or to constitute a
representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.
2.12 SHARING OF PAYMENTS. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Loans of any Type
made by it, or the participations in L/C Obligations held by it, any payment
(whether voluntary, involuntary, through the exercise of any right of set-off,
or otherwise) in excess of its ratable share (or other share contemplated
hereunder) thereof, such Lender shall immediately (a) notify the Administrative
Agent of such fact, and (b) purchase from the other Lenders such participations
in the Loans of such Type made by them and/or such subparticipations in the
participations in L/C Obligations, as shall be necessary to cause such
purchasing Lender to share the excess payment in respect of such Type of Loan or
such participations, as the case may be, pro rata with each of them; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from the purchasing Lender, such purchase shall to that extent be
rescinded and each other Lender shall repay to the purchasing Lender the
purchase price paid therefor, together with an amount equal to such paying
Lender's ratable share (according to the proportion of (i) the amount of such
paying Lender's required repayment to (ii) 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 may, to
the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off, but subject to Section 10.09) with respect to
such participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation. The Administrative Agent will keep
records (which shall be conclusive and binding in the absence of manifest error)
of participations purchased under this Section and will in each case notify the
Lenders following any such purchases or repayments. Each Lender that purchases a
participation pursuant to this Section shall from and after such purchase have
the right to give all notices, requests, demands, directions and other
communications under this Agreement with respect to the portion of the
Obligations purchased to the same extent as though the purchasing Lender were
the original owner of the Obligations purchased.
2.13 INCREASE IN COMMITMENTS.
(a) Upon notice to the Administrative Agent (which shall promptly
notify the Lenders), the Borrower may, at any time during which no Default or
Event of Default has occurred and is continuing, request an increase in the
Aggregate Commitments in a minimum amount of not less than $50,000,000, provided
that the resulting Aggregate Commitments shall not exceed $500,000,000 during
the term of this Agreement. At the time of sending such notice, the Borrower (in
consultation with the Administrative Agent) shall specify the time period within
which each Lender is requested to respond (which shall in no event be less than
10 Business Days from the date of delivery of such notice to the Lenders). Each
Lender shall notify the Administrative Agent within such time period whether or
not it agrees in its sole discretion to
35. New Ceridian Credit Agreement
41
increase its Commitment and, if so, whether by an amount equal to, greater than,
or less than its Pro Rata Share of any such requested increase. Any Lender not
responding within such time period shall be deemed to have declined to increase
its Commitment. The Administrative Agent shall notify the Borrower and each
Lender of the Lenders' responses to each such request made hereunder. To achieve
the full amount of a requested increase, the Borrower may also invite additional
Eligible Assignees to become Lenders pursuant to a joinder agreement in form and
substance satisfactory to the Administrative Agent and its counsel.
(b) If any Commitments are increased in accordance with this Section,
the Administrative Agent and the Borrower shall determine the effective date of
any such increase (each, an "Increase Effective Date"). The Administrative Agent
and the Borrower shall promptly notify the Lenders of the final allocation of
any such increase and the applicable Increase Effective Date. As conditions
precedent to each such increase, the Borrower shall pay the Administrative Agent
a commitment increase administration fee, for the Administrative Agent's own
account, of $25,000 on each occasion of each such increase and shall deliver to
the Administrative Agent a certificate of each Loan Party dated as of the
applicable Increase Effective Date (in sufficient copies for each Lender) signed
by a Responsible Officer of such Loan Party (i) certifying and attaching the
resolutions adopted by such Loan Party approving or consenting to such increase,
(ii) in the case of the Borrower, including a Compliance Certificate
demonstrating pro forma compliance with Section 7.10 after giving effect to such
increase and (iii) certifying that, before and after giving effect to such
increase, the representations and warranties contained in Article V are true and
correct on and as of the Increase Effective Date and that no Default or Event of
Default exists. The Borrower shall deliver new or amended Loan Notes reflecting
the increased Commitment of any Lender holding or requesting a Loan Note. The
Administrative Agent shall distribute an amended Schedule 2.01 (which shall be
deemed incorporated into this Agreement), to reflect any changes therein
resulting from any such increase. The Borrower shall prepay any Loans
outstanding on the applicable Increase Effective Date (and shall pay any
additional amounts required pursuant to Section 3.05) to the extent necessary to
keep the outstanding Loans ratable with any revised Pro Rata Shares arising from
any nonratable increase in the Commitments under this Section.
(c) This Section shall supersede any provisions in Section 10.01 to the
contrary.
ARTICLE III.
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 TAXES.
(a) Subject to Section 3.01(e), any and all payments by the Borrower to
or for the account of the Administrative Agent or any Lender under any Loan
Document shall be made free and clear of and without deduction for any and all
present or future taxes, duties, levies, imposts, deductions, assessments, fees,
withholdings or similar charges, and all liabilities with respect thereto,
excluding, in the case of the Administrative Agent and each Lender, taxes
imposed on or measured by its net income, and franchise taxes imposed on it (in
lieu of net income taxes), by the jurisdiction (or any political subdivision
thereof) under the Laws of which the Administrative Agent or such Lender, as the
case may be, is organized or maintains a lending office (all such non-excluded
taxes, duties, levies, imposts, deductions, assessments, fees, withholdings or
36. New Ceridian Credit Agreement
42
similar charges, and liabilities being hereinafter referred to as "Taxes"). If
the Borrower shall be required by any Laws to deduct any Taxes from or in
respect of any sum payable under any Loan Document to the Administrative Agent
or any Lender, (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section), the Administrative Agent and such Lender
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions, (iii) the
Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable Laws, and (iv) within 30 days
after the date of such payment, the Borrower shall furnish to the Administrative
Agent (which shall forward the same to such Lender) the original or a certified
copy of a receipt evidencing payment thereof.
(b) In addition, the Borrower agrees to pay any and all present or
future stamp, court or documentary taxes and any other excise or property taxes
or charges or similar levies which arise from any payment made under any Loan
Document or from the execution, delivery, performance, enforcement or
registration of, or otherwise with respect to, any Loan Document (hereinafter
referred to as "Other Taxes").
(c) If the Borrower shall be required to deduct or pay any Taxes or
Other Taxes from or in respect of any sum payable under any Loan Document to the
Administrative Agent or any Lender, the Borrower shall also pay to the
Administrative Agent (for the account of such Lender) or to such Lender, at the
time interest is paid, such additional amount that such Lender specifies as
necessary to preserve the after-tax yield (after factoring in all taxes,
including taxes imposed on or measured by net income) such Lender would have
received if such Taxes or Other Taxes had not been imposed.
(d) Subject to Section 3.01(e), the Borrower agrees to indemnify the
Administrative Agent and each Lender for (i) the full amount of Taxes and Other
Taxes (including any Taxes or Other Taxes imposed or asserted by any
jurisdiction on amounts payable under this Section) paid by the Administrative
Agent and such Lender, (ii) amounts payable under Section 3.01(c) and (iii) any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto, in each case whether or not such Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority.
Payment under this subsection (d) shall be made within 30 days after the date
the Lender or the Administrative Agent makes a demand therefor.
(e) The Borrower shall not be required to pay any additional amounts in
respect of United States Federal income tax pursuant to Section 3.01(a) to any
Lender for the account of any Lending Office of such Lender:
(i) if the obligation to pay such additional amounts would not
have arisen but for a failure by such Lender to comply with its
obligations under Section 10.15 in respect of such Lending Office; or
(ii) If a Lender shall have delivered to the Borrower the
forms referred to in Section 10.15, and such Lender shall not at any
time be entitled to exemption from deduction or withholding of United
States Federal income tax in respect of payments by
37. New Ceridian Credit Agreement
43
the Borrower hereunder for the account of the Lending Office of such
Lender for any reason other than a change in United States law or
regulations or in the official interpretation of such law or
regulations by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the
force of law) after the date of delivery of such forms.
3.02 ILLEGALITY. If any Lender determines that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make, maintain or fund
Eurodollar Rate Loans, or materially restricts the authority of such Lender to
purchase or sell, or to take deposits of, Dollars in the applicable offshore
Dollar market, or to determine or charge interest rates based upon the
Eurodollar Rate, then, on notice thereof by such Lender to the Borrower through
the Administrative Agent, any obligation of such Lender to make or continue
Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar Rate Loans
shall be suspended until such Lender notifies the Administrative Agent and the
Borrower that the circumstances giving rise to such determination no longer
exist. Upon receipt of such notice, the Borrower shall, upon demand from such
Lender (with a copy to the Administrative Agent), prepay or, if applicable,
convert all Eurodollar Rate Loans of such Lender to Base Rate Loans, either on
the last day of the Interest Period thereof, if such Lender may lawfully
continue to maintain such Eurodollar Rate Loans to such day, or immediately, if
such Lender may not lawfully continue to maintain such Eurodollar Rate Loans.
Upon any such prepayment or conversion, the Borrower shall also pay interest on
the amount so prepaid or converted. Each Lender agrees to designate a different
Lending Office if such designation will avoid the need for such notice and will
not, in the good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender.
3.03 INABILITY TO DETERMINE RATES. If the Administrative Agent
determines in connection with any request for a Eurodollar Rate Loan or a
conversion to or continuation thereof that (a) Dollar deposits are not being
offered to banks in the applicable offshore Dollar market for the applicable
amount and Interest Period of such Eurodollar Rate Loan, (b) adequate and
reasonable means do not exist for determining the Eurodollar Rate for such
Eurodollar Rate Loan, or (c) the Eurodollar Rate for such Eurodollar Rate Loan
does not adequately and fairly reflect the cost to the Lenders of funding such
Eurodollar Rate Loan, the Administrative Agent will promptly notify the Borrower
and all Lenders. Thereafter, the obligation of the Lenders to make or maintain
Eurodollar Rate Loans shall be suspended until the Administrative Agent revokes
such notice. Upon receipt of such notice, the Borrower may revoke any pending
request for a Borrowing, conversion or continuation of Eurodollar Rate Loans or,
failing that, will be deemed to have converted such request into a request for a
Borrowing of Base Rate Loans in the amount specified therein.
3.04 INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY.
(a) If any Lender determines that as a result of the introduction of or
any change in or in the interpretation of any Law, or such Lender's compliance
therewith, there shall be any increase in the cost to such Lender of agreeing to
make or making, funding or maintaining Eurodollar Rate Loans or (as the case may
be) issuing or participating in Letters of Credit, or a reduction in the amount
received or receivable by such Lender in connection with any of the foregoing
(excluding for purposes of this subsection (a) any such increased costs or
reduction in
38. New Ceridian Credit Agreement
44
amount resulting from (i) Taxes or Other Taxes (as to which Section 3.01 shall
govern), (ii) changes in the basis of taxation of overall net income or overall
gross income by the United States or any foreign jurisdiction or any political
subdivision of either thereof under the Laws of which such Lender is organized
or has its Lending Office, and (iii) reserve requirements utilized, as to
Eurodollar Rate Loans, in the determination of the Eurodollar Rate), then from
time to time, within 30 days after the written demand of such Lender (such
demand to be accompanied by a certificate of the type described in Section
3.06(a), with a copy of such demand to be sent to the Administrative Agent), the
Borrower shall pay to such Lender such additional amounts as will compensate
such Lender for such increased cost or reduction.
(b) If any Lender determines that the introduction of any Law regarding
capital adequacy or any change therein or in the interpretation thereof, or
compliance by such Lender (or its Lending Office) therewith, has the effect of
reducing the rate of return on the capital of such Lender or any corporation
controlling such Lender as a consequence of such Lender's obligations hereunder
(taking into consideration its policies with respect to capital adequacy and
such Lender's desired return on capital), then from time to time, within 30 days
after the demand of such Lender (such demand to be accompanied by a certificate
of the type described in Section 3.06(a), with a copy of such demand to be sent
to the Administrative Agent), the Borrower shall pay to such Lender such
additional amounts as will compensate such Lender for such reduction.
(c) If the Borrower is required to pay any amount to any Lender or the
Administrative Agent pursuant to subsection (a) or (b) of this Section 3.04,
then such Lender shall use reasonable efforts (consistent with legal and
regulatory restrictions) to change the jurisdiction of its Lending Office to
another existing location of such Lender so as to eliminate any such additional
payment by the Borrower which may thereafter accrue, if such change in the sole
judgment of such Lender is not otherwise disadvantageous to such Lender.
3.05 FUNDING LOSSES. Upon demand of any Lender (with a copy to the
Administrative Agent) from time to time, the Borrower shall promptly compensate
such Lender for and hold such Lender harmless from any loss, cost or expense
incurred by it as a result of:
(a) any continuation, conversion, payment or prepayment of any Loan
other than a Base Rate Loan on a day other than the last day of the Interest
Period for such Loan (whether voluntary, mandatory, automatic, by reason of
acceleration, or otherwise and including pursuant to Section 2.13);
(b) any failure by the Borrower (for a reason other than the failure of
such Lender to make a Loan) to prepay, borrow, continue or convert any Loan
other than a Base Rate Loan on the date or in the amount notified by the
Borrower;
(c) any assignment of a Eurodollar Rate Loan on a day other than the
last day of the Interest Period therefor as a result of a request by the
Borrower pursuant to Section 10.16; or
(d) any assignment by any Lead Lender of a Eurodollar Rate Loan on a
day on or before 180 days after the Closing Date and other than the last day of
the Interest Period therefor;
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45
including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were obtained.
The Borrower shall also pay any customary administrative fees charged by such
Lender in connection with the foregoing.
For purposes of calculating amounts payable by the Borrower to the Lenders
under this Section 3.05, each Lender shall be deemed to have funded each
Eurodollar Rate Loan made by it at Eurodollar Base Rate used in determining the
Eurodollar Rate for such Loan by a matching deposit or other borrowing in the
applicable offshore Dollar interbank market for a comparable amount and for a
comparable period, whether or not such Eurodollar Rate Loan was in fact so
funded.
3.06 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.
(a) A certificate of the Administrative Agent or any Lender claiming
compensation under this Article III and setting forth the calculation of the
additional amount or amounts to be paid to it hereunder shall be conclusive in
the absence of manifest error. In determining such amount, the Administrative
Agent or such Lender may use any reasonable averaging and attribution methods.
(b) Upon any Lender's making a claim for compensation under Section 3.01,
3.02 or 3.04, the Borrower may remove or replace such Lender in accordance with
Section 10.16.
(c) The Borrower shall not be obligated to pay any amounts under Sections
3.01(d), 3.04(a) or 3.04(b) which arose prior to the date which is 180 days
preceding the date of the demand required by each such Section or which is
attributable to periods prior to the date which is 180 days preceding the date
of such demand.
3.07 SURVIVAL. All of the Borrower's obligations under this Article III
shall survive termination of the Commitments and payment in full of
all the other Obligations.
ARTICLE IV.
CONDITIONS PRECEDENT
4.01 CONDITIONS TO EFFECTIVENESS. The effectiveness of this Agreement is
subject to satisfaction of the following conditions precedent:
(a) Unless waived by all the Lenders (or by the Administrative Agent with
respect to immaterial matters or items specified in clause (iv) below with
respect to which the Borrower has given assurances satisfactory to the
Administrative Agent that such items shall be delivered promptly following the
Effectiveness Date), the Administrative Agent's receipt of the following, each
of which shall be originals or facsimiles (followed promptly by originals)
unless otherwise specified, each properly executed by a Responsible Officer of
the signing Loan Party party thereto, each dated the Effectiveness Date (or, in
the case of certificates of governmental officials, a recent date before the
Effectiveness Date) and each in form and substance satisfactory to the
Administrative Agent and the Lenders:
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46
(i) executed counterparts of this Agreement and the Guaranty,
sufficient in number for distribution to the Administrative Agent, each
Lender and the Borrower;
(ii) Loan Notes executed by the Borrower in favor of each Lender
requesting a Loan Note, each in a principal amount equal to such Lender's
Commitment;
(iii) such certificates of resolutions or other action, incumbency
certificates and/or other certificates of Responsible Officers of each Loan
Party as the Administrative Agent may reasonably require to establish the
identities of and verify the authority and capacity of each Responsible
Officer thereof authorized to act as a Responsible Officer in connection
with this Agreement and the other Loan Documents to which such Loan Party
is a party;
(iv) such evidence as the Administrative Agent may reasonably require
to verify that each Loan Party is duly organized or formed, validly
existing, in good standing and qualified to engage in business in each
jurisdiction (A) in which it is incorporated, or has any headquarter
function, or (B) in which it is required to be qualified to engage in
business if the absence of such qualification could have a Material Adverse
Effect; including certified copies of each Loan Party's Organization
Documents, certificates of good standing and/or qualification to engage in
business and tax good standing certificates;
(v) a certificate signed by a Responsible Officer of the Borrower
certifying (A) that all representations and warranties contained in Article
V are true and correct on and as of the Effectiveness Date and no Default
or Event of Default exists on and as of such date; (B) that there has been
no event or circumstance since the date of the most recent of the Audited
Financial Statements which has or could be reasonably expected to have a
Material Adverse Effect; and (C) that the Borrower's and the Parent's
senior management are highly confident that the Spin-Off Consummation Date
will occur by no later than the Spin-Off Deadline under the terms specified
in the Spin-Off Documents delivered under subsection (a)(vii) below;
(vi) one or more opinions of counsel to each Loan Party with respect
to those matters set forth in Exhibit F;
(vii) a certificate signed by a Responsible Officer of the Borrower
certifying (A) the attachment of complete and current draft or final copies
of all material Spin-Off Documents, which shall be in form and substance
reasonably satisfactory to the Administrative Agent and the Lenders, (B)
the attachment of a true and complete copy of the Form 10 as submitted by
the Borrower to the SEC in connection with the Spin-Off Transaction
(together with and including all exhibits and attachments thereto), which
shall be in form and substance satisfactory to the Administrative Agent and
the Lenders, and (C) the attachment of a solvency opinion provided by the
Xxxxxxxx Xxxxx firm in respect of the Borrower and the Parent,
respectively, addressed to the Administrative Agent, dated as of the
Effectiveness Date, and any and all certificates and other documents
provided by the Borrower to the Xxxxxxxx Xxxxx firm in respect of such
opinion;
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47
(viii) such other financial information and documentation as the
Administrative Agent or any Lender may reasonably request, in form and
substance reasonably satisfactory to the Administrative Agent and the
Lenders, including (A) five-year financial projections for the Borrower and
the Parent and their respective Subsidiaries and (B) a preliminary pro
forma opening balance sheet of the Borrower and its Subsidiaries as of the
Separation Date ("Preliminary Opening Balance Sheet"), prepared by the
Borrower;
(ix) evidence of the Borrower's receipt of the IRS Ruling Letter;
(x) evidence of a waiver or consent with respect to the defaults
otherwise arising under the Existing Credit Facility from the consummation
of the Spin-Off Transaction and the financings contemplated thereby by the
"Agent" and "Lenders" as defined in and party to the Existing Credit
Facility; and
(xi) such other assurances, certificates, documents, consents or
opinions as the Administrative Agent, the L/C Issuer, or the Required
Lenders reasonably may require.
(b) The corporate, legal, capital, tax, contractual, and management
structure and attributes of the Borrower and its Subsidiaries and of the
Spin-Off Transaction shall be satisfactory to the Administrative Agent and the
Lenders.
(c) Any fees required to be paid on or before the Effectiveness Date shall
have been paid, and unless waived by the Administrative Agent, the Borrower
shall have paid all Attorney Costs of the Administrative Agent to the extent
invoiced prior to or on the Effectiveness Date, plus such additional amounts of
Attorney Costs as shall constitute its reasonable estimate of Attorney Costs
incurred or to be incurred by it through the closing proceedings (provided that
such estimate shall not thereafter preclude a final settling of accounts between
the Borrower and the Administrative Agent).
(d) The Effectiveness Date shall occur no later than February 5, 2001.
4.02 CONDITIONS TO INITIAL CREDIT EXTENSION. The obligation of each Lender
to make its initial Credit Extension hereunder is subject to satisfaction of the
following conditions precedent:
(a) Unless waived by all the Lenders, the Administrative Agent's receipt of
the following, each of which shall be originals or facsimiles (followed promptly
by originals) unless otherwise specified, each properly executed by a
Responsible Officer of the signing Loan Party, each dated the Closing Date and
each in form and substance satisfactory to the Administrative Agent and the
Lenders:
(i) a certificate signed by a Responsible Officer of the Borrower
certifying (A) that all representations and warranties of the Borrower
contained in Article V are true and correct on and as of the Closing Date,
(B) that there exists as of such date no Default or Event of Default, (C)
that there has been no event or circumstance since the date of the most
recent Audited Financial Statements which has or could reasonably be
expected to have a Material Adverse Effect, (D) that the Separation Date
has occurred pursuant to the
42. New Ceridian Credit Agreement
48
Spin-Off Documents, which are in full force and effect and in substantially
the form delivered in connection with the Effectiveness Date (or otherwise
in form and substance satisfactory to the Administrative Agent and the
Lenders), (E) that the Borrower's and the Parent's senior management are
highly confident that the Spin-Off Consummation Date will occur by no later
than the Spin-Off Deadline, (F) that the Parent has obtained stockholder
approval to effect a reverse stock split of the Parent's shares of common
stock at a ratio not to exceed one for five, which stock split shall occur
promptly but in any event not more than 60 days after the Spin-Off
Consummation Date, (G) that the Board of Directors of the Parent has
authorized and approved the final terms of the Spin-Off Transaction
(including the declaration of a dividend of the shares of the Borrower's
common stock to the stockholders of the Parent), (H) that the SEC has
approved the form of the Form 10 as it may have been amended since the
Effectiveness Date to reflect (I) revisions made to conform the Spin-Off
Documents filed with the Form 10 to those delivered to the Administrative
Agent pursuant to Section 4.01(a)(vii), (II) the inclusion of the opinions
described in Section 4.02(a)(iv), (III) any required date revisions not
inconsistent with the terms hereof, (IV) ministerial revisions necessary to
address administrative issues or facial ambiguities, and (V) other
amendments satisfactory to the Required Lenders, (I) such other matters
relating to the Spin-Off Transaction as the Administrative Agent may
request, and (J) the current Debt Ratings for the Borrower, taking into
account all matters transpiring on or before the Closing Date;
(ii) a pro forma compliance certificate of the Borrower and its
Subsidiaries, signed by a Responsible Officer of the Borrower;
(iii) a certificate signed by a Responsible Officer of the Borrower
certifying the attachment of (A) a true and complete final pro forma
operating balance sheet of the Borrower and its Subsidiaries as of the
Separation Date, prepared by the Borrower, which shall contain in the
opinion of the Administrative Agent and the Lenders no material adverse
discrepancies from the Preliminary Opening Balance Sheet, and (B) a true
and complete copy of the Supplemental Financial Statements;
(iv) a certificate dated as of the Closing Date and signed by a
Responsible Officer of the Borrower certifying the Borrower's receipt, and
attaching a true and complete copy, of (A) a solvency opinion provided by
the Xxxxxxxx Xxxxx firm in respect of the Parent and the Borrower,
respectively, and addressed to the Administrative Agent, and any and all
certificates and other documents provided by the Borrower to the Xxxxxxxx
Xxxxx firm in respect of such opinion and (B) a fairness, financial
viability and "fair value" opinion addressed to the Parent (or its Board of
Directors) and relating to the Spin-Off Transaction, provided by the
Parent's financial advisors, Bear Xxxxxxx & Co., and including any and all
certificates and other documents provided by the Parent to Bear Xxxxxxx &
Co. in respect of such opinion;
(v) evidence of payment (prior to or upon the initial funding) of all
funded Indebtedness of the Parent existing immediately prior to the Closing
Date and termination of all credit commitments (including the Existing
Credit Facility), other than the Initial Permitted Indebtedness, and
evidence of the allocation, which shall be satisfactory to the
Administrative Agent and the Lenders, of all contingent and other
liabilities of the Parent
43. New Ceridian Credit Agreement
49
as between the Borrower and the Parent, with such third party
acknowledgments or consents relating thereto as the Administrative Agent
may request;
(vi) one or more opinions of counsel to the Borrower regarding the
matters specified in Exhibit G;
(viii) an assignment and assumption agreement relating to the Existing
Letter of Credit signed by all parties thereto; and
(ix) such other assurances, certificates, documents, consents or
opinions as the Administrative Agent, the L/C Issuer, or the Required
Lenders reasonably may require.
(b) The Closing Date shall occur no later than March 30, 2001.
(c) The corporate, legal, capital, tax, contractual, and management
structure and attributes of the Borrower and its Subsidiaries and of the
Spin-Off Transaction shall conform to those deemed satisfactory by the
Administrative Agent and the Lenders as a condition to the Effectiveness Date,
or shall otherwise be satisfactory to the Administrative Agent and the Lenders.
4.03 CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation of each Lender to
honor any Request for Credit Extension (other than a Loan Notice requesting only
a conversion of Loans to the other Type, or a continuation of Loans as the same
Type) is subject to the following conditions precedent:
(a) The representations and warranties of the Borrower contained in Article
V, or which are contained in any document furnished at any time under or in
connection herewith, shall be true and correct on and as of the date of such
Credit Extension, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they shall be true and
correct as of such earlier date.
(b) No Default or Event of Default shall exist, or would result from such
proposed Credit Extension.
(c) The Administrative Agent and, if applicable, the L/C Issuer shall have
received a Request for Credit Extension in accordance with the requirements
hereof.
(d) The Administrative Agent shall have received, in form and substance
satisfactory to it, such other assurances, certificates, documents or consents
related to the foregoing as the Administrative Agent or the Required Lenders
reasonably may require.
Each Request for Credit Extension (other than a Loan Notice requesting only
a conversion of Loans to the other Type or a continuation of Loans as the same
Type) submitted by the Borrower shall be deemed to be a representation and
warranty that the conditions specified in Sections 4.03(a) and (b) have been
satisfied on and as of the date of the applicable Credit Extension.
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50
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Administrative Agent and each
Lender as follows. (For purposes of this Article V, all references to "the
Borrower" shall be deemed to include predecessors in interest of the Borrower,
including the Parent, in respect of any matters concerning acts or circumstances
originating, occurring or existing prior to the Spin-Off Consummation Date):
5.01 CORPORATE EXISTENCE AND POWER.
(a) Each of the Borrower and each Material Subsidiary:
(i) is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(ii) has the power and authority and all material governmental
licenses, authorizations, consents and approvals to own its assets and
carry on its business and to execute, deliver, and perform its obligations
under the Loan Documents;
(iii) is duly qualified as a foreign corporation, licensed and in good
standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such
qualification or license, except where the failure to be so qualified,
licensed or in good standing would not adversely affect the business or
operations of the Borrower or such Subsidiary in any significant manner;
and
(iv) is in compliance with all material Laws applicable to it.
(b) Each Subsidiary of the Borrower which is not a Material Subsidiary:
(i) is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(ii) has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets and carry on its
business;
(iii) is duly qualified as a foreign corporation, licensed and in good
standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such
qualification; and
(iv) is in compliance with all material Laws applicable to it;
except where any failure to comply with the requirements of this subsection (b)
would not, individually or in the aggregate, result in a Material Adverse
Effect.
(c) As of the Closing Date, the Borrower does not have any material place
of business in any jurisdiction other than the State of Minnesota and the State
of Georgia.
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51
5.02 CORPORATE AUTHORIZATION; NO CONTRAVENTION. The execution, delivery and
performance by each Loan Party of this Agreement, each other Loan Document and
each Spin-Off Document, and the consummation of the Spin-Off Transaction, have
been duly authorized by all necessary corporate action by or on behalf of the
Parent and the Borrower, and do not and will not:
(a) contravene the terms of the Borrower's or the Parent's Organization
Documents;
(b) conflict with or result in any breach or contravention of, or the
creation of any Lien under, any document evidencing any Contractual Obligation
(other than the Senior Note Indenture) to which the Borrower or, until the
Spin-Off Consummation Date, the Parent, is a party or any order, injunction,
writ or decree of any Governmental Authority to which the Borrower or its
property is subject; or
(c) violate any Law applicable to the Borrower or the Parent.
5.03 GOVERNMENTAL AUTHORIZATION. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection (a) with the
execution, delivery or performance by, or enforcement against, the Borrower of
this Agreement or any other Loan Document or (b) the execution, delivery or
performance by or enforcement against the Parent or the Borrower of the Spin-Off
Documents, or (c) the consummation of the Spin-Off Transaction, except, in each
case, as have been obtained on or before the Closing Date.
5.04 BINDING EFFECT.
(a) This Agreement and each other Loan Document to which the Borrower or
any of its Subsidiaries is a party, when executed and delivered, will constitute
the legal, valid and binding obligations of the Borrower and any of its
Subsidiaries to the extent it is a party thereto, enforceable against such
Person in accordance with their respective terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, or similar laws affecting the
enforcement of creditors' rights generally or by equitable principles relating
to enforceability.
(b) From and after the Closing Date, each Spin-Off Document constitutes the
legal, valid and binding obligation of each Person party thereto, enforceable
against such Person in accordance with its terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, or similar laws affecting the
enforcement of creditors' rights generally or by equitable principles relating
to enforceability. As of the Closing Date, all conditions to effectiveness of
the Spin-Off Documents have been satisfied.
5.05 LITIGATION. Attached hereto as Schedule 5.05 is a list of all material
litigation in which the Parent, the Borrower or any Subsidiary of the Parent or
Borrower is a plaintiff or a defendant as of the Effectiveness Date. There are
no actions, suits, proceedings, claims or disputes pending, or to the best
knowledge of the Borrower, threatened or contemplated, at law, in equity, in
arbitration or before any Governmental Authority, against the Parent, the
Borrower, or their respective Subsidiaries or any of their respective properties
which:
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52
(a) purport to affect or pertain to this Agreement, or any other Loan
Document, or any of the transactions contemplated hereby or thereby; or
(b) challenge in any respect the legality or validity of any material
aspect of the Spin-Off Transaction; or
(c) except as provided in Schedule 5.05, would reasonably be expected to
have a Material Adverse Effect (and assuming for this purpose a reasonable
likelihood of an adverse decision). No injunction, writ, temporary restraining
order or any order of any nature has been issued by any court or other
Governmental Authority purporting to enjoin or restrain the execution, delivery
or performance of this Agreement or any other Loan Document, or the consummation
of any material aspect of the Spin-Off Transaction, or directing that the
transactions provided for herein or therein not be consummated as herein or
therein provided. Since the Effectiveness Date, there has been no change in the
status of any of the matters set forth in Schedule 5.05 that would reasonably be
expected to result in a Material Adverse Effect.
5.06 NO DEFAULT. No Default or Event of Default exists or would result from
the incurring of any Obligations by the Borrower. As of the Effectiveness Date
and the Closing Date, neither the Borrower or any of its Subsidiaries, nor the
Parent or any of its Subsidiaries, (a) is in default under or with respect to
any Contractual Obligation in any respect which, individually or together with
all such defaults, could reasonably be expected to have a Material Adverse
Effect, or (b) is in default under or with respect to any Spin-Off Document. As
of the Effectiveness Date there exists no "Default" or "Event of Default", and
as of the Closing Date there exists no "Event of Default" under and as defined
in (i) the Existing Credit Facility or (ii) the Senior Note Indenture.
5.07 ERISA COMPLIANCE. Except as referenced or provided for in either
Schedule 5.05 or Schedule 5.07 attached hereto:
(a) To the best knowledge of the Borrower, no facts or circumstances exist
which would reasonably be expected to have a Material Adverse Effect in
connection with the failure of any Plan, or the failure of the Borrower, an
ERISA Affiliate or any Person with regard to the Plan, to comply with the
applicable provisions of ERISA, the Code and other Federal or state law. The
Borrower and each ERISA Affiliate have made all required contributions to any
Plan subject to Section 412 of the Code, and no application for a funding waiver
or an extension of any amortization period pursuant to Section 412 of the Code
has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of the Borrower,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan which has resulted or would, if determined adversely to
the Borrower or any Plan, reasonably be expected to result in a Material Adverse
Effect. There has been no prohibited transaction or violation of the fiduciary
responsibility rules with respect to any Plan which has resulted or would
reasonably be expected to result in a Material Adverse Effect.
(c) To the best knowledge of the Borrower (i) no ERISA Event has occurred
or is reasonably expected to occur; (ii) neither the Borrower nor any ERISA
Affiliate has incurred,
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53
nor reasonably expects to incur, any liability under Title IV of ERISA with
respect to any Pension Plan (other than premiums due and not delinquent under
Section 4007 of ERISA); (iii) neither the Borrower nor any ERISA Affiliate has
incurred, nor reasonably expects to incur, any liability (and no event has
occurred which, with the giving of notice under Section 4219 of ERISA, would
result in such liability) under Section 4201 or 4243 of ERISA with respect to a
Multiemployer Plan; and (iv) neither the Borrower nor any ERISA Affiliate has
engaged in a transaction that would reasonably be expected to be subject to
Section 4069 or 4212(c) of ERISA.
5.08 TITLE TO PROPERTIES. As of the Effectiveness Date and the Closing
Date, the property of the Borrower and its Subsidiaries is subject to no Liens,
other than Permitted Liens. As of the Closing Date, the Parent has sold,
assigned and transferred to the Borrower all of the Parent's assets, other than
those directly relating to the Arbitron Business, subject to no Liens, claims or
interest of third parties, other than Permitted Liens.
5.09 TAXES.
(a) The Borrower and its Subsidiaries have filed all Federal and other
material tax returns and reports required to be filed, and have paid all Federal
and other material taxes, assessments, fees and other governmental charges
levied or imposed upon them or their properties, income or assets otherwise due
and payable, except those which are being contested in good faith by appropriate
proceedings and for which adequate reserves have been provided in accordance
with GAAP and no Notice of Lien has been filed or recorded. There is no proposed
tax assessment against the Borrower or any of its Subsidiaries which would, if
the assessment were made, have a Material Adverse Effect.
(b) None of the representations and warranties made by the Borrower, the
Parent or any of their Subsidiaries to the IRS in connection with the Spin-Off
Transaction (including with respect to the tax-free nature of the Spin-Off
Transaction and in connection with the Borrower's request for the IRS Ruling
Letter) as of the date such representations and warranties are made or deemed
made, and none of the statements contained in any report, exhibit, statement or
certificate furnished by or on behalf of the Parent, the Borrower or any of
their Subsidiaries to the IRS in connection with the Spin-Off Transaction as of
the date such statements are made or deemed made, contains any untrue statement
of a material fact or omits any material fact required to be stated therein or
necessary to make the statements made therein, in light of the circumstances in
which they are made, not misleading.
(c) As of the Effectiveness Date and the Closing Date, neither the Borrower
nor any of its Subsidiaries is aware of or party to any plan or series of
related transactions by which a 50% or greater interest in the Borrower or the
Parent will be acquired by one or more Persons, or by any Affiliates or Persons
related to or controlled by such Person or Persons, within the four-year period
commencing on the date that is two years prior to the Spin-Off Consummation
Date.
5.10 FINANCIAL CONDITION.
(a) The Form-10 Financial Statements and the Supplemental Financial
Statements:
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(i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein, subject to ordinary, good faith year-end audit adjustments and the
absence of footnotes in the case of quarterly financial statements;
(ii) are complete, accurate and fairly present the financial condition
of the Borrower and its Subsidiaries as of the date thereof and results of
operations for the period covered thereby, in each case based upon the
assumed consummation of the Spin-Off Transaction on such date; and
(iii) comply with all applicable requirements of Law relating to
spin-off transactions.
(b) Except as disclosed in filings by the Parent with the Securities and
Exchange Commission on Form 10-Q for the quarter ended June 30, 2000, or the
Form 10, since December 31, 1999, there has been no Material Adverse Effect.
(c) As of the Effectiveness Date and the Closing Date, the Borrower and its
consolidated Subsidiaries have not incurred any material Contingent Obligations,
except for those set forth on Schedule 5.10 or described in Section 7.05(e)(ii)
or Section 7.05(f). The projections delivered by the Borrower pursuant to
Section 4.01(a)(viii)(A) have been reasonably prepared in good faith, based upon
reasonable assumptions.
(d) The Preliminary Opening Balance Sheet delivered by the Borrower to the
Administrative Agent pursuant to Section 4.01(a)(viii) and the pro forma
operating balance sheet delivered by the Borrower to the Administrative Agent
pursuant to Section 4.02(a)(iii): (i) were prepared on a basis consistent with
GAAP as applied to the Borrower's financial statements, (ii) have been prepared
in good faith by the Borrower based on reasonable assumptions, (iii) are based
on the best information available to the Borrower as of the date of delivery
thereof, (iv) accurately reflect all material adjustments required to be made to
give effect to the Spin-Off Transaction, and (v) present fairly on a pro forma
basis the estimated consolidated financial position of the Borrower and its
Subsidiaries as of the date thereof, assuming consummation of the Spin-Off
Transaction.
5.11 ENVIRONMENTAL MATTERS.
(a) The on-going operations of the Borrower and each of its Subsidiaries
comply in all respects with all Environmental Laws, except such non-compliance
which would not (if enforced in accordance with applicable law) result in
liability that would reasonably be expected to have a Material Adverse Effect.
(b) As of the Effectiveness Date and the Closing Date, except as
specifically disclosed on Schedule 5.11, none of the Parent, the Borrower, any
of their respective Subsidiaries or any of their respective present property or
operations is subject to any outstanding written order from or agreement with
any Governmental Authority nor subject to any judicial or docketed
administrative proceeding, respecting any Environmental Law, Environmental Claim
or Hazardous Material.
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(c) Except as specifically disclosed on Schedule 5.11, there are no
Hazardous Materials or other conditions or circumstances existing with respect
to any property, or arising from operations of the Borrower or any of its
Subsidiaries that would reasonably be expected to give rise to Environmental
Claims with a potential liability of the Borrower and its Subsidiaries that in
the aggregate for any such condition, circumstance or property would reasonably
be expected to have a Material Adverse Effect.
5.12 REGULATED ENTITIES. None of the Borrower, any Person controlling the
Borrower, or any Subsidiary of the Borrower, is (a) an "investment company"
within the meaning of the Investment Company Act of 1940; or (b) subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act, any state public utilities code, or any
other Federal or state statute or regulation limiting its ability to incur
Indebtedness, except that certain Persons who may be deemed to control the
Borrower are registered investment companies within the meaning of the
Investment Company Act of 1940.
5.13 NO BURDENSOME RESTRICTIONS. Neither the Borrower nor any of its
Subsidiaries (other than any Canadian payroll processing Subsidiary of the
Borrower in existence as of the Closing Date) is a party to or bound by any
Contractual Obligation, or subject to any charter or corporate restriction, or
any Law, which could reasonably be expected to have a Material Adverse Effect.
As of the Effectiveness Date and the Closing Date, no Subsidiary is party to or
bound by any Contractual Obligation restricting the ability of such Subsidiary
to pay dividends or make loans to the Borrower.
5.14 SOLVENCY. The Borrower and each of its Material Subsidiaries are
Solvent. Both immediately before and after the Separation Date and the Spin-Off
Consummation Date, the Parent and the Borrower are Solvent. All statements
contained in any certificate delivered to the Administrative Agent pursuant to
Section 4.01(a)(vii) and Section 4.02(a)(iv) are true and accurate in all
material respects, are not materially misleading and do not contain any material
omissions of fact.
5.15 LABOR RELATIONS. There are no strikes, lockouts or other labor
disputes against the Borrower or any of its Subsidiaries, or, to the best of the
Borrower's knowledge, threatened against or affecting the Borrower or any of its
Subsidiaries, and no significant unfair labor practice complaint is pending
against the Borrower or any of its Subsidiaries or, to the best knowledge of the
Borrower, threatened against any of them before any Governmental Authority
which, in any case, could reasonably be expected to have a Material Adverse
Effect.
5.16 COPYRIGHTS, PATENTS, TRADEMARKS AND LICENSES, ETC. Except for any
failure to comply with the requirements of this Section 5.16 which would not,
individually or in the aggregate, result in a Material Adverse Effect: (a) at
all times from and after the Separation Date, the Borrower or its Subsidiaries
own or are licensed or otherwise have the right to use all of the patents,
trademarks, service marks, trade names, copyrights, franchises, authorizations
and other rights that are reasonably necessary for the operation of their
respective businesses, without conflict with the rights of any other Person; (b)
to the best knowledge of the Borrower, no slogan or other advertising device,
product, process, method, substance, part or other material now employed, or now
contemplated to be employed by the Borrower or any of its Subsidiaries infringes
upon any rights held by any other Person; and (c) except as specifically
disclosed on
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Schedule 5.05 attached hereto, no claim or litigation regarding any of the
foregoing is pending or, to the best knowledge of the Borrower, threatened, and
no patent, invention, device, application, principle or any statute, law, rule,
regulation, standard or code is pending or, to the knowledge of the Borrower,
proposed.
5.17 MATERIAL SUBSIDIARIES AND EQUITY INVESTMENTS. As of the Effectiveness
Date and the Closing Date, the Borrower has no Subsidiaries other than the
Subsidiaries set forth on Schedule 5.17 attached hereto. The Borrower has no
Material Subsidiaries other than as set forth on Schedule 5.17 or as disclosed
to the Administrative Agent and the Lenders pursuant to Section 6.03(h)
(including their jurisdiction of incorporation) and has no Investment in any
Person which is not a Subsidiary of the Borrower except for such Investments
that do not exceed in the aggregate 10% of Consolidated Net Worth. All
Investments of the Borrower and its Subsidiaries (other than Investments in
Subsidiaries) with a net book value in excess of $1,000,000 as of the Closing
Date are set forth on Schedule 5.17(A) attached hereto.
5.18 INSURANCE. As of the Effectiveness Date and the Closing Date, the
properties of the Borrower and its Subsidiaries are insured with financially
sound and reputable insurance companies, in such amounts, with such deductibles
and covering such risks as are customarily carried by companies engaged in
similar businesses and owning similar properties in localities where the
Borrower or such Subsidiary operates.
5.19 SPIN-OFF DOCUMENTS. The representations and warranties of the Borrower
contained in the Spin-Off Documents and in any other document filed or delivered
to the SEC in connection with the Spin-Off Transaction are true and accurate in
all material respects as of the Effectiveness Date and the Closing Date and as
of any other date specified in such documents. There are no material documents
or agreements to be entered into by the Borrower or the Parent or any of their
respective Subsidiaries in connection with the Spin-Off Transaction other than
the Spin-Off Documents.
5.20 FULL DISCLOSURE. None of the representations or warranties made by the
Parent, the Borrower or any of its Subsidiaries in the Loan Documents as of the
date such representations and warranties are made or deemed made, and none of
the statements contained in each exhibit, report, statement or certificate
furnished by or on behalf of the Borrower or any Subsidiary in connection with
the Loan Documents as of the date such statements are made or deemed made,
contains any untrue statement of a material fact or omits any material fact
required to be stated therein or necessary to make the statements made therein,
in light of the circumstances under which they are made, not misleading. The
Form 10 (including all Exhibits thereto) does not contain any untrue statement
of a material fact or omit any material fact required to be stated therein or
necessary to make the statements made therein, in light of the circumstances
under which they were made, not misleading.
5.21 THIRD-PARTY CONSENTS. Other than as set forth in Schedule 5.21, and
except as have been obtained before the Closing Date, no approval, consent,
exemption, authorization, amendment or waiver, or other action by, or notice to,
or filing with, any third party is necessary or required in connection with (a)
the execution, delivery or performance by or enforcement against the Parent or
the Borrower of the Spin-Off Documents, or (b) the consummation of the Spin-Off
Transaction.
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5.22 YEAR END. The fiscal year of the Borrower and the Parent ends on
December 31st of each year.
5.23 EXISTING INDEBTEDNESS. As of the Closing Date, neither the Borrower
nor any of its Subsidiaries has any Indebtedness other than Initial Permitted
Indebtedness. The allocation of Indebtedness and other obligations existing as
of the Closing Date, as between the Borrower and the Parent, has been undertaken
in a fair and reasonable fashion.
5.24 SWAP CONTRACTS. As of the Closing Date, neither the Borrower nor any
of its Subsidiaries is subject to any obligation in respect of any Swap
Contracts other than Permitted Swap Obligations.
ARTICLE VI.
AFFIRMATIVE COVENANTS
The Borrower covenants and agrees that, so long as any Lender shall have
any Commitment hereunder, or any Loan or other Obligation shall remain unpaid or
unsatisfied, unless the Required Lenders waive compliance in writing:
6.01 FINANCIAL STATEMENTS. The Borrower shall deliver to the Administrative
Agent and each Lender in form and detail satisfactory to the Administrative
Agent and the Required Lenders:
(a) as soon as available, but not later than 90 days after the end of each
fiscal year commencing with the fiscal year ending December 31, 2000, a copy of
the audited consolidated financial statements of the Borrower as of the end of
such fiscal year, setting forth in each case in comparative form the figures for
the previous year (based on the Audited Financial Statements, if applicable),
and accompanied by the opinion of KPMG Peat Marwick LLP or another
nationally-recognized independent public accounting firm, which report shall
state that such consolidated financial statements present fairly in all material
respects the financial position of the Borrower and its Subsidiaries (showing
the Arbitron Business as a discontinued operation, in the case of the December
31, 2000 financials) as of the dates indicated and the results of their
operations and their cash flows for the periods indicated in conformity with
GAAP; such opinion shall not be qualified or limited for any reason, including,
because of a restricted or limited examination by such accountant of any
material portion of the Borrower's or any Subsidiary's records; and
(b) as soon as available, but not later than 45 days after the end of the
first three fiscal quarters of each fiscal year of the Borrower, (i) a copy of
the Borrower `s quarterly report on Form 10-Q filed with the SEC with respect to
such fiscal quarter, (ii) an operating report summarizing the Borrower's
consolidated (A) year-to-date profit and loss, revenue, operating profit,
invested capital, and cash flow information, and (B) fiscal year forecasts of
profit and loss, balance sheet, and cash flow information, as well as fiscal
year comparative forecasts of consolidating revenue, profit and loss, operating
profit, and investment capital information; or (iii) if the Borrower at such
time is not required to file such Form 10-Q with the SEC under the Exchange Act,
as soon as available, but in any event within 60 days after the end of each
fiscal quarter, a consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such fiscal quarter, and the related consolidated
statements of income and cash flows for such fiscal
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quarter and for the portion of the Borrower's fiscal year then ended, setting
forth in each case in comparative form the figures for the corresponding fiscal
quarter of the previous fiscal year, and the corresponding portion of the
previous fiscal year (based on the Audited Financial Statements and the
Supplemental Financial Statements, if applicable), together with the items
described at clauses (A) and (B) of this subsection; all in reasonable detail
and certified by a Responsible Officer of the Borrower as fairly presenting the
financial condition, results of operations, and cash flows of the Borrower and
its Subsidiaries in accordance with GAAP, subject only to normal year-end audit
adjustments and the absence of footnotes.
6.02 CERTIFICATES; OTHER INFORMATION. The Borrower shall furnish to the
Administrative Agent and each Lender:
(a) as soon as available, but not later than 15 days after the delivery of
the financial statements referred to in Section 6.01(a) and (b) above, a
Compliance Certificate, signed by a Responsible Officer;
(b) copies of each registration statement (or prospectus contained therein)
of the Borrower other than with respect to employee benefit plans, each periodic
report regarding the Borrower required pursuant to Section 13 of the Exchange
Act, each annual report, each proxy statement and any amendments to any of the
above filed or reported by the Borrower with or to any securities exchange or
the SEC, copies of each communication from the Borrower or any Subsidiary to the
Borrower's shareholders generally, promptly upon the filing or making thereof
and copies of such other filings, reports and communications with the Borrower's
shareholders as the Administrative Agent may from time to time request;
(c) upon release, copies of all financially material press releases by the
Borrower or, at any time prior to the Spin-Off Consummation Date, by the Parent;
(d) promptly after the creation or Purchase of any Material Subsidiary, the
name of such Subsidiary, a description of its business, the price paid for the
stock or assets of such Subsidiary, its net worth and the value of its assets;
and
(e) promptly, such additional business, financial, corporate affairs and
other information as the Administrative Agent, at the request of any Lender, may
from time to time reasonably request.
Reports required to be delivered pursuant to Sections 6.01(a) or (b) or
6.02(b) shall be deemed to have been delivered on the date on which Borrower
posts such reports on the Borrower's website on the Internet at the website
address listed on Schedule 10.02 hereof or when such report is posted on the
Securities and Exchange Commission's website at xxx.xxx.xxx; provided that (x)
Borrower shall deliver paper copies of such reports to the Administrative Agent
or any Lender who requests the Borrower to deliver such paper copies until
written request to cease delivering paper copies is given by the Administrative
Agent or such Lender, (y) the Borrower shall notify by facsimile the
Administrative Agent and each Lender of the posting of any such reports, and (z)
in every instance the Borrower shall provide paper copies of the Compliance
Certificates required by Section 6.02(a) to the Administrative Agent and each of
the Lenders. Except for such Compliance Certificates, the Administrative Agent
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shall have no obligation to request the delivery or to maintain copies of the
reports referred to above, and in any event shall have no responsibility to
monitor compliance by the Borrower with any such request for delivery, and each
Lender shall be solely responsible for requesting delivery to it or maintaining
its copies of such reports.
6.03 NOTICES. The Borrower shall promptly notify the Administrative Agent
and each Lender upon a Responsible Officer of the Borrower obtaining knowledge:
(a) of the occurrence of any Default or Event of Default and, until the
Spin-Off Consummation Date, the occurrence of any "Default" or "Event of
Default" under and as defined in the Arbitron Credit Agreement;
(b) of (i) any breach or non-performance of, or any default under, any
Contractual Obligation of the Borrower or any of its Subsidiaries which would
reasonably be expected to result in a Material Adverse Effect; and (ii) any
dispute, litigation, investigation, proceeding or suspension which may exist at
any time between the Borrower or any of its Subsidiaries and any Governmental
Authority which would reasonably be expected to result in a Material Adverse
Effect (and assuming for this purpose a reasonable likelihood of an adverse
decision);
(c) of the commencement of, or any material development in, any litigation
or proceeding affecting the Borrower or any Subsidiary (i) which would
reasonably be expected to have a Material Adverse Effect (and taking into
account the reasonable likelihood of an adverse decision), or (ii) in which the
relief sought is an injunction or other stay of the performance of this
Agreement or any Loan Document or the consummation of the Spin-Off Transaction;
(d) of (i) any and all enforcement, cleanup, removal or other governmental
or regulatory actions affecting the Borrower or any of its Subsidiaries or any
of their respective properties pursuant to any applicable Environmental Laws,
(ii) all other Environmental Claims, and (iii) any environmental or similar
condition on any real property adjoining or in the vicinity of the property of
the Borrower or any Subsidiary that could reasonably be anticipated to cause the
property of the Borrower or any of its Subsidiaries or any part thereof to be
subject to any restrictions on the ownership, occupancy, transferability or use
of such property under any Environmental Laws, if, individually or in the
aggregate, the events or conditions described or the amount claimed in clauses
(i), (ii) and (iii) would reasonably be expected to result in a Material Adverse
Effect;
(e) of the occurrence of any ERISA Event affecting the Borrower or any
ERISA Affiliate, and deliver to the Administrative Agent and each Lender a copy
of any notice with respect to such event that is filed with a Governmental
Authority and any notice delivered by a Governmental Authority to the Borrower
or any ERISA Affiliate with respect to such event;
(f) of any Material Adverse Effect subsequent to the date of the most
recent audited financial statements of the Borrower delivered to the Lenders
pursuant to Section 6.01(a);
(g) of any labor controversy resulting in or threatening to result in any
strike, work stoppage, boycott, shutdown or other labor disruption against or
involving the Borrower or any of its Subsidiaries;
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(h) of the creation, purchase, or acquisition of any Subsidiary (including
its jurisdiction of incorporation);
(i) of (i) any Subsidiary (including its jurisdiction of incorporation)
being or becoming a Material Subsidiary, or (ii) of any Material Subsidiary
ceasing to be a Material Subsidiary;
(j) of any change in any Debt Rating assigned by S&P or Xxxxx'x;
(k) of the occurrence of the Separation Date and the Spin-Off Consummation
Date;
(l) of any Trust Asset GAAP Change; and
(m) of any material breach or default under, or any material waiver or
consent granted pursuant to, any Spin-Off Document.
Each notice pursuant to this Section 6.03 shall be accompanied by a written
statement by a Responsible Officer of the Borrower setting forth details of the
occurrence referred to therein, and stating what action, if any, the Borrower
proposes to take with respect thereto and at what time. Each notice under
Section 6.03(a) shall describe with particularity any and all clauses or
provisions of this Agreement or other Loan Document that have been breached or
violated.
6.04 PRESERVATION OF CORPORATE EXISTENCE, ETC. The Borrower shall, and
shall cause each of its Subsidiaries to:
(a) except as permitted in Section 7.02, preserve and maintain in full
force and effect its corporate existence and good standing under the laws of its
state or jurisdiction of incorporation;
(b) preserve and maintain in full force and effect all material rights,
privileges, qualifications, permits, licenses and franchises necessary or
desirable in the normal conduct of its business except in connection with
transactions permitted by Section 7.02;
(c) use its reasonable efforts, in the Ordinary Course of Business, to
preserve its business organization and preserve the goodwill and business of the
customers, suppliers and others having material business relations with it; and
(d) preserve or renew all of its registered trademarks, trade names and
service marks, the non-preservation of which would reasonably be expected to
have a Material Adverse Effect, provided, however, that the Borrower shall not
be deemed to be in default under this Section 6.04 if a Subsidiary (other than a
Material Subsidiary) fails to comply herewith so long as such failure is not
material.
6.05 MAINTENANCE OF PROPERTY. The Borrower shall maintain, and shall cause
each of its Subsidiaries to maintain, and preserve all its property which is
used or useful in its business in good working order and condition, ordinary
wear and tear excepted, make all necessary repairs thereto and renewals and
replacements thereof, and to keep such property free of any Hazardous Materials,
except where the failure to do so would not reasonably be expected to result in
a
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Material Adverse Effect, except as permitted by Section 7.02. The Borrower shall
use at least the standard of care typical in the industry in the operation of
its facilities.
6.06 INSURANCE. The Borrower shall maintain, and shall cause each of its
Material Subsidiaries to maintain, with financially sound and reputable
independent insurers, insurance with respect to its properties and business
against loss or damage of the kinds customarily insured against by Persons
engaged in the same or similar business, of such types and in such amounts as
are customarily carried under similar circumstances by such other Persons;
including workers' compensation insurance, public liability and property and
casualty insurance. Upon request of the Administrative Agent or any Lender, the
Borrower shall furnish the Administrative Agent, with sufficient copies for each
Lender, at reasonable intervals (but not more than once per calendar year) a
certificate of a Responsible Officer of the Borrower (and, if requested by the
Administrative Agent, any insurance broker of the Borrower) setting forth the
nature and extent of all insurance maintained by the Borrower and its Material
Subsidiaries in accordance with this Section 6.06 (and which, in the case of a
certificate of a broker, were placed through such broker).
6.07 PAYMENT OF OBLIGATIONS. The Borrower shall, and shall cause its
Subsidiaries to, pay and discharge as the same shall become due and payable, all
their respective obligations and liabilities, including:
(a) all tax liabilities, assessments and governmental charges or levies
upon it or its properties or assets, unless the same are being contested in good
faith by appropriate proceedings and adequate reserves in accordance with GAAP
are being maintained by the Borrower or such Subsidiary;
(b) all lawful claims which, if unpaid, would by law become a Lien upon its
property; and
(c) all Indebtedness, as and when due and payable, but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness;
provided, however, that the Borrower and its Subsidiaries shall not be deemed to
be in default under this Section 6.07 if failure to comply herewith would not
result in a Material Adverse Effect.
6.08 COMPLIANCE WITH LAWS. The Borrower shall comply, and shall cause each
of its Subsidiaries to comply, in all material respects with all material Laws
applicable to it or its business (including the Federal Fair Labor Standards
Act), except such as may be contested in good faith or as to which a bona fide
dispute may exist.
6.09 INSPECTION OF PROPERTY AND BOOKS AND RECORDS. The Borrower shall
maintain and shall cause each of its Material Subsidiaries to maintain proper
books of record and account, in which full, true and correct entries in
conformity with GAAP consistently applied shall be made of all financial
transactions and matters involving the assets and business of the Borrower and
such Subsidiaries. The Borrower shall permit, and shall cause each of its
Material Subsidiaries to permit, representatives and independent contractors of
the Administrative Agent or any Lender to visit and inspect any of their
respective properties, to examine their respective
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corporate, financial and operating records, and make copies thereof or abstracts
therefrom, and to discuss their respective affairs, finances and accounts with
their respective officers and independent public accountants at such reasonable
times during normal business hours and as often as may be reasonably desired,
upon reasonable advance notice to the Borrower; provided, however, when a
Default exists, (i) the Administrative Agent or any Lender may do any of the
foregoing with respect to the Borrower or any Subsidiary at any time during
normal business hours and without advance notice and (ii) such inspection,
examination and meetings shall be at the Borrower's expense.
6.10 ENVIRONMENTAL LAWS.
(a) The Borrower shall, and shall cause each of its Subsidiaries to,
conduct its operations and keep and maintain its property in compliance in all
material respects with all Environmental Laws.
(b) Upon the written request of the Administrative Agent or any Lender, the
Borrower shall submit to the Administrative Agent with sufficient copies for
each Lender, at the Borrower's sole cost and expense, a report providing an
update of the status of any environmental, health or safety compliance, hazard
or liability issue identified in any notice or report required pursuant to
Section 6.03(d).
6.11 USE OF PROCEEDS. The Borrower may use the proceeds of the Loans and
the Letters of Credit (a) to provide all or a portion of the funds necessary to
repay in full the Indebtedness of Borrower outstanding as of the Closing Date,
to the extent otherwise permitted or required hereunder, and to replace any
letters of credit outstanding under the Existing Credit Facility, (b) to
repurchase or redeem securities of the Borrower to the extent otherwise
permitted hereunder, and (c) for working capital and other general corporate
purposes (including permitted Purchases). Letters of Credit shall be used by the
Borrower and its Subsidiaries for Ordinary Course of Business purposes.
6.12 FURTHER ASSURANCES.
(a) The Borrower shall ensure that all written information, exhibits and
reports furnished to the Administrative Agent or the Lenders do not and will not
contain any untrue statement of a material fact and do not and will not omit to
state any material fact necessary to make the statements contained therein not
misleading in light of the circumstances in which made, and will promptly
disclose to the Administrative Agent and the Lenders and correct any defect or
error that may be discovered therein or in any Loan Document or in the
execution, acknowledgment or recordation thereof.
(b) Promptly upon request by the Administrative Agent or the Required
Lenders, the Borrower shall (and shall cause any of its Subsidiaries to) do,
execute, acknowledge and deliver any and all such further acts, certificates,
assurances and other instruments as the Administrative Agent or such Lenders, as
the case may be, may reasonably require from time to time in order (i) to carry
out more effectively the purposes of this Agreement or any other Loan Document,
and (ii) to better assure, convey, grant, assign, transfer, preserve, protect
and confirm to the Administrative Agent and Lenders the rights granted or now or
hereafter intended to be granted
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to the Lenders under any Loan Document or under any other document executed in
connection therewith.
ARTICLE VII.
NEGATIVE COVENANTS
The Borrower hereby covenants and agrees that, so long as any Lender shall
have any Commitment hereunder, or any Loan or other Obligation shall remain
unpaid or unsatisfied, unless the Required Lenders waive compliance in writing:
7.01 LIMITATION ON LIENS. The Borrower shall not, and shall not suffer or
permit any of its Subsidiaries to, directly or indirectly, make, create, incur,
assume or suffer to exist any Lien upon or with respect to any part of its
property, whether now owned or hereafter acquired, other than the following
("Permitted Liens"):
(a) any Lien created under any Loan Document;
(b) Liens for taxes, fees, assessments or other governmental charges or
statutory obligations which are not delinquent or remain payable without
penalty, or to the extent that non-payment thereof is permitted by Section 6.07,
provided that no Notice of Lien has been filed or recorded under the Code;
(c) Liens arising in the Ordinary Course of Business in connection with
obligations (other than obligations for borrowed money) that are not overdue or
which are being contested in good faith and by appropriate proceedings,
including, but not limited to Liens under bid, performance and other surety
bonds, supersedeas and appeal bonds, Liens on advance or progress payments
received from customers under contracts for the sale, lease or license of goods,
software or services and upon the products being sold or licensed, in each case
securing performance of the underlying contract or the repayment of such
advances in the event final acceptance of performance under such contracts does
not occur; and Liens upon funds collected temporarily from others pending
payment or remittance on their behalf;
(d) Liens (other than any Lien imposed by ERISA) required in the Ordinary
Course of Business in connection with workers' compensation, unemployment
insurance and other social security legislation;
(e) easements, rights-of-way, restrictions and other similar encumbrances
incurred in the Ordinary Course of Business which, in the aggregate, are not
substantial in amount, and which do not in any case materially detract from the
value of the property subject thereto or interfere with the ordinary conduct of
the businesses of the Borrower and its Subsidiaries;
(f) purchase money security interests on any property acquired or held by
the Borrower or its Subsidiaries in the Ordinary Course of Business securing
Indebtedness incurred or assumed for the purpose of financing all or any part of
the cost of acquiring such property to the extent permitted under Section 7.04;
provided, however, that (i) any such Lien attaches to such property concurrently
with or within 20 days after the acquisition thereof, (ii) such Lien attaches
solely to the property so acquired in such transaction, and (iii) the principal
amount of the debt secured thereby does not exceed 100% of the cost of such
property;
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(g) Liens arising solely by virtue of any statutory or common law provision
relating to banker's liens, rights of set-off or similar rights and remedies as
to deposit accounts or other funds maintained with a creditor depository
institution; provided, however, that (i) such deposit account is not a dedicated
cash collateral account and is not subject to restrictions against access by the
Borrower in excess of those set forth by regulations promulgated by the Federal
Reserve Board, and (ii) such deposit account is not intended by the Borrower or
any of its Subsidiaries to provide collateral to the depository institution;
(h) rights of holders of notes or debentures issued by the Borrower or any
Subsidiary in deposits placed in trust to legally or "in substance" defease such
notes or debentures;
(i) Liens consisting of pledges of cash collateral or government securities
to secure, on a xxxx-to-market basis, Permitted Swap Obligations only, provided
that the aggregate value of such collateral so pledged by the Borrower and the
Subsidiaries together in favor of any counterparty does not at any time exceed
$25,000,000;
(j) the interest of a purchaser of Permitted Receivables pursuant to a
Permitted Securitization, or any Lien on the assets of a Securitization
Subsidiary granted pursuant to a Permitted Securitization;
(k) Liens on the property or assets of any corporation that becomes a
Subsidiary of the Borrower after the Effectiveness Date, provided that (i) such
Liens exist at the time such corporation becomes a Subsidiary, and (ii) such
Liens are not created in contemplation of such acquisition by the Borrower or
its Subsidiaries or for purposes of circumventing this Agreement;
(l) Liens on the property or assets of any Subsidiary securing obligations
of any such Subsidiary to the Borrower; or
(m) any Lien (not otherwise permitted by this Section 7.01) securing an
obligation of the Borrower or any Subsidiary if the aggregate amount of all such
obligations secured by all such Liens does not exceed 15% of Consolidated Net
Worth; provided, however, that the assets of any Material Subsidiary may only be
subject to Liens permitted under this Section 7.01(m) which secure obligations
that do not exceed 15% of such Material Subsidiary's total assets, as determined
in accordance with GAAP.
7.02 MERGERS, CONSOLIDATIONS AND DISPOSITIONS OF ASSETS.
(a) Except as provided in Section 7.02(b), the Borrower shall not, and
shall not permit any of its Subsidiaries to: (i) sell, assign, lease, convey,
transfer or otherwise dispose of (whether in one or a series of related
transactions) any property or assets (including accounts and notes receivable,
with or without recourse) (collectively, "transfer") to any Person except in the
Ordinary Course of Business; (ii) transfer to any Person other than the Borrower
or a Subsidiary any outstanding capital stock that has been issued by any
Subsidiary; or (iii) consolidate with or merge into any other Person.
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(b) Section 7.02(a) shall not apply to or restrict:
(i) merger or consolidation of any third Person with or into the
Borrower or any existing Subsidiary of the Borrower, provided that (A) no
Default or Event of Default has occurred and is continuing at the time of,
or would result from, the consummation of such merger or consolidation, and
(B) either (1) the Borrower or such existing Subsidiary of the Borrower is
the surviving entity in such merger or, if the third Person or a new entity
is the surviving or resulting entity in such merger or consolidation, it
becomes a Subsidiary of the Borrower by virtue of such merger or
consolidation with an existing Subsidiary, or (2) if the merger or
consolidation involves an existing Subsidiary of the Borrower and clause
(B)(1) is not applicable, the transaction would be permitted by Section
7.02(b)(x) utilizing the net book value of the Subsidiary;
(ii) the merger or consolidation of any Subsidiary into the Borrower,
or with or into any other Subsidiaries, provided that if any such
transaction is between a Subsidiary and a Wholly-Owned Subsidiary, the
Wholly-Owned Subsidiary is the continuing or surviving corporation;
(iii) the transfer by any Subsidiary of the Borrower of any assets
(upon voluntary liquidation or otherwise) to the Borrower or a Wholly-Owned
Subsidiary of the Borrower;
(iv) transfers of real estate not used or useful in the business of
the Borrower and its Subsidiaries, any bulk sale of inventory not
representing a then current product line of the Borrower or its
Subsidiaries, or any sale of property or assets used in connection with
discontinued or abandoned product lines of the Borrower or its
Subsidiaries;
(v) the sale of equipment to the extent that such equipment is
exchanged for credit against the purchase price of similar replacement
equipment, or the proceeds of such sale are reasonably promptly applied to
the purchase price of such replacement equipment;
(vi) the transfer of assets by the Borrower to any of its Subsidiaries
(A) made in connection with a transaction permitted under subsection (b)(i)
above, or (B) if such transfer is a sale for fair market value and the
consideration received by the Borrower is cash;
(vii) the mergers, consolidations or transfers of assets listed on
Schedule 7.02 attached hereto;
(viii) (A) a sale or transfer of Permitted Receivables pursuant to a
Permitted Securitization and (B) servicer advances, each for a term not
exceeding three months, not to exceed $5,000,000 in the aggregate at any
time for all such advances then outstanding and undertaken pursuant to one
or more Permitted Securitizations;
(ix) any transfer of assets by the Borrower or any of its Subsidiaries
to any Person in connection with the extension of Indebtedness or making an
investment or
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acquisition transaction or business combination otherwise permitted under
this Agreement; and
(x) transfers of assets not otherwise permitted hereunder (whether by
merger, consolidation or otherwise) occurring after the Closing Date which
are made for fair market value; provided, however, that (A) at the time of
any transfer, no Default or Event of Default exists or would result from
such transfer and (B) the aggregate net book value of all assets so
transferred per annum by the Borrower and its Subsidiaries together shall
not exceed 6% of Consolidated Total Assets.
7.03 CASH INVESTMENTS; MINORITY INVESTMENTS. The Borrower shall not, and
shall not permit any of its Subsidiaries to, (a) invest any assets classified in
accordance with GAAP on the Borrower's consolidated balance sheet as "cash and
equivalents" or "short-term investments" in investments other than Cash
Equivalents, investment grade marketable securities, and servicer advances
permitted under Section 7.02(b)(viii), or (b) make any Investment in any Person
which is not a Subsidiary of the Borrower, except for such Investments that,
when aggregated with the Investments set forth on Schedule 5.17(A) hereto, do
not exceed in the aggregate 10% of Consolidated Net Worth.
7.04 INDEBTEDNESS. The Borrower shall not, and shall not permit any of its
Subsidiaries to, incur, assume or suffer to exist any Indebtedness (a) if a
Default or Event of Default has occurred and is continuing or would result from
the incurrence or assumption of such Indebtedness or (b) if the aggregate
principal amount of all such Indebtedness of such Subsidiaries (other than
Securitization Subsidiaries) would exceed 10% of Consolidated Net Worth;
provided, however, that up to $50,000,000 (or the Canadian Dollar equivalent) of
purchase money indebtedness incurred heretofore or hereafter by Subsidiaries of
the Borrower to acquire certain payroll businesses in Canada, and any
extensions, renewals and refinancings of such purchase money indebtedness, shall
not be included as Indebtedness for purposes of computing the amount
contemplated by subsection (b) above, provided that the principal amount of any
such purchase money indebtedness being extended, renewed or refinanced does not
increase.
7.05 CONTINGENT OBLIGATIONS. The Borrower shall not, and shall not suffer
or permit any of its Subsidiaries to, create, incur, assume or suffer to exist
any Contingent Obligations except:
(a) Contingent Obligations incurred pursuant to this Agreement;
(b) Contingent Obligations undertaken by Comdata pursuant to a Permitted
Securitization;
(c) endorsements for collection or deposit in the Ordinary Course of
Business;
(d) Guaranty Obligations of the Borrower relating to account overdrafts
incurred by the Borrower solely in its capacity as a trustee in respect of third
party payroll deposit accounts maintained by the Borrower in the Ordinary Course
of Business, where (i) recourse to the Borrower is limited to such trust assets,
or (ii) recourse is not so limited and the Borrower has
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recourse to such trust assets for reimbursement or contribution under applicable
law and contract;
(e) (i) Contingent Obligations described in item 1 of Schedule 5.10; and
(ii) until the Spin-Off Consummation Date, Contingent Obligations incurred in
connection with the guaranty, of near or even date herewith, made by the
Borrower (A) in favor of Bank of America, N.A. (in its capacity as
administrative agent under the Arbitron Credit Agreement) to guarantee the
obligations of the Parent under the Arbitron Credit Agreement, and (B) to
guarantee the obligations of the Parent under the Arbitron Private Placement
Documents;
(f) Contingent Obligations consisting of Guaranty Obligations of (i) the
Borrower in respect of Indebtedness of any Wholly-Owned Subsidiary or (ii) any
Subsidiary in respect of Indebtedness of the Borrower or any Wholly-Owned
Subsidiary;
(g) Contingent Obligations consisting of Guaranty Obligations of the
Borrower in respective of any Permitted Swap Contract (as defined in the
Arbitron Credit Agreement) to which the Parent is party; and
(h) other Contingent Obligations of the Borrower and its Subsidiaries in an
aggregate amount not in excess of $50,000,000 at any time.
7.06 USE OF PROCEEDS. The Borrower shall not and shall not suffer or permit
any of its Subsidiaries to use any portion of the Loan proceeds, or any Letter
of Credit, directly or indirectly, in violation of Regulation T, U or X of the
Federal Reserve Board.
7.07 HOSTILE ACQUISITIONS. The Borrower shall not, and shall not permit any
of its Subsidiaries to, (a) Purchase, or attempt to Purchase, any Person by
means of a public debt or equity tender offer or other unsolicited takeover (or
the equivalent thereof in any jurisdiction) or (b) engage in a proxy contest (or
the equivalent thereof in any jurisdiction) for control of the board of
directors (or the functional equivalent thereof) of any Person, in either case
which has not been approved and recommended by the board of directors (or the
functional equivalent thereof) of the Person being acquired or proposed to be
acquired or which is the subject of such proxy contest.
7.08 LEASE OBLIGATIONS. The Borrower shall not permit the aggregate minimum
non- cancelable payment commitments in respect of Operating Leases for the
Borrower and its Subsidiaries on a consolidated basis determined in accordance
with GAAP at the end of any fiscal year to exceed, for any subsequent fiscal
year, $60,000,000.
7.09 INTEREST COVERAGE RATIO. On and after the Effectiveness Date, the
Borrower shall not permit its ratio of (a) Consolidated EBIT to (b) Consolidated
Interest Expense, each calculated for the immediately preceding four fiscal
quarters of the Borrower (including fiscal quarters ending prior to the
Effectiveness Date, using for this purpose the Form 10 Financial Statements and
the Supplemental Financial Statements), to be less than 2.75 to 1.00.
7.10 DEBT/TOTAL CAPITALIZATION. On and after the Effectiveness Date, the
Borrower shall not permit, as of the end of any fiscal quarter, its ratio of (a)
Consolidated Indebtedness to (b) the sum of Consolidated Indebtedness plus
Consolidated Net Worth, to be greater than 50%.
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7.11 CHANGE IN BUSINESS. The Borrower shall not, and shall not permit any
of its Subsidiaries to, (a) engage in any material line of business
substantially different from those lines of business (other than the Arbitron
Business) carried on by the Parent and its Subsidiaries on the Effectiveness
Date; or (b) extend any material amount of Indebtedness to or make any material
equity investment in any Person which engages in one or more lines of business
all of which are substantially different from those lines of business (other
than the Arbitron Business) carried on by the Parent and its Subsidiaries on the
Effectiveness Date; or (c) enter into any joint venture which engages in a
material line of business substantially different from those lines of business
(other than the Arbitron Business) carried on by the Parent and its Subsidiaries
on the Effectiveness Date.
7.12 ACCOUNTING CHANGES. The Borrower shall not, and shall not suffer or
permit any of its Subsidiaries to, make any significant change in accounting
treatment or reporting practices, except as required or permitted by GAAP, or
change the fiscal year of the Borrower or of any of its consolidated
Subsidiaries.
7.13 CONTRACTS OF SUBSIDIARIES. The Borrower shall not permit any of its
Subsidiaries (other than any Canadian payroll processing Subsidiary of the
Borrower in existence as of the Closing Date) to enter into any Contractual
Obligation restricting the ability of such Subsidiary to pay dividends or make
loans to the Borrower or Subsidiaries of the Borrower.
7.14 LICENSES. The Borrower shall, and shall cause each of its Subsidiaries
to, obtain and maintain all material licenses, authorizations, consents,
filings, exemptions, registrations and other governmental approvals necessary in
connection with the execution, delivery and performance of the Loan Documents,
the consummation of the transactions therein contemplated or the operation and
conduct of its business and ownership of their properties.
7.15 TRANSACTIONS WITH AFFILIATES. The Borrower shall not, and shall not
suffer or permit any of its Subsidiaries to, enter into any transaction of any
kind with any Affiliate of the Borrower (other than a Subsidiary), or with the
Parent and any of its Subsidiaries, other than the Spin-Off Transaction and
arm's-length transactions with such Persons that are otherwise permitted
hereunder.
7.16 CERTAIN TAX-MATTERS. The Borrower shall not, (a) during the two year
period following the Closing Date, cease to be engaged in the active trade or
business relied upon for purposes of satisfying the requirements of Section
355(b) of the Code in the IRS Ruling Letter; or (b) during the applicable period
provided by Section 355(e)(2)(B) of the Code with respect to the Distribution,
enter into any transaction or make any change to its equity structure (including
stock issuances, pursuant to the exercise of options, option grants or
otherwise, or capital contributions or acquisitions, but not including the
Distribution) that may cause the Distribution to be treated as part of a plan
pursuant to which one or more Persons acquire directly or indirectly capital
stock of the Borrower representing a "50 percent or greater interest" in the
Borrower within the meaning of Section 355(e) of the Code; provided that, in
each case, the Borrower may take such actions to the extent otherwise permitted
hereunder if (i) the Borrower delivers to the Administrative Agent a private
letter ruling from the IRS to the effect that such actions should not result in
the Distribution or the Spin-Off Transaction being taxable to the Parent or its
shareholders, or (ii) the Borrower delivers to the Administrative Agent an
opinion of
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independent counsel addressed to the Administrative Agent to the same effect,
provided that such opinion is reasonably acceptable to the Administrative Agent.
7.17 CERTAIN CONTRACTS. Unless consented to by the Required Lenders, the
Borrower shall not, and shall not suffer or permit any of its Subsidiaries to,
enter into any amendment, revision, supplement or modification to the Spin-Off
Documents after the Closing Date, other than (a) ministerial changes necessary
to address administrative issues, and (b) changes necessary to address facial
ambiguities.
ARTICLE VIII.
EVENTS OF DEFAULT AND REMEDIES
8.01 EVENTS OF DEFAULT. Any of the following shall constitute an Event of
Default:
(a) Non-Payment. The Borrower fails to pay (i) when and as required to be
paid herein, any amount of principal of any Loan, or any L/C Obligation, or (ii)
within three days after the same becomes due, any interest on any Loan or on any
L/C Obligation, or any commitment, utilization or other fee due hereunder, or
(iii) within five days after the same becomes due, any other amount payable
hereunder or under any other Loan Document; or
(b) Specific Covenants. The Borrower fails to perform or observe any term,
covenant, or agreement contained in Section 6.03(a), Section 6.09, Section 6.11
or in Article VII; or the Borrower fails to perform or observe any term,
covenant or agreement contained in Section 6.01 or Section 6.02 or in Section
6.03 (other than subsection (a) thereof) and such failure continues unremedied
for a period of 10 days; or
(c) Other Defaults. The Borrower fails to perform or observe any other term
or covenant contained in this Agreement or any other Loan Document, and such
default continues unremedied for a period of 20 days; or
(d) Representations and Warranties. Any representation or warranty made or
deemed made by the Borrower or any other Loan Party herein, in any other Loan
Document, or in any document delivered in connection herewith or therewith
proves to have been incorrect in any material respect when made or deemed made;
or
(e) Cross-Default. (i) The Borrower or any Subsidiary (A) fails to make any
payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) in respect of any Indebtedness or Guaranty
Obligation (other than Indebtedness hereunder and Indebtedness under Swap
Contracts) having an aggregate principal amount (including undrawn committed or
available amounts and including amounts owing to all creditors under any
combined or syndicated credit arrangement) of more than the Threshold Amount, or
(B) fails to observe or perform any other agreement or condition relating to any
such Indebtedness or Guaranty Obligation or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event occurs,
the effect of which default or other event is to cause, or to permit the holder
or holders of such Indebtedness or the beneficiary or beneficiaries of such
Guaranty Obligation (or a trustee or agent on behalf of such holder or holders
or beneficiary or beneficiaries) to cause, with the giving of notice if
required, such Indebtedness to be demanded or to become due or to be repurchased
or redeemed (automatically
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or otherwise) prior to its stated maturity, or such Guaranty Obligation to
become payable or cash collateral in respect thereof to be demanded; (ii) there
occurs under any Swap Contract an Early Termination Date (as defined in such
Swap Contract) resulting from (A) any event of default under such Swap Contract
as to which the Borrower or any Subsidiary is the Defaulting Party (as defined
in such Swap Contract) or (B) any Termination Event (as so defined) under such
Swap Contract as to which the Borrower or any Subsidiary is an Affected Party
(as so defined) and, in either event, the Swap Termination Value owed by the
Borrower or such Subsidiary as a result thereof is greater than the Threshold
Amount; or (iii) there occurs any early termination, liquidation, unwind or
similar event or circumstance under any Permitted Securitization as a result of
which any purchaser of receivables thereunder has ceased purchasing such
receivables and has applied all collections on previously purchased receivables
thereunder to the repayment of such purchaser's interest in such previously
purchased receivables, other than (A) any such event or circumstance that arises
solely as the result of a down-grading of the credit rating of any bank or
financial institution not affiliated with the Borrower that provides liquidity,
credit or other support in connection with any such Permitted Securitization, or
(B) any termination undertaken voluntarily by the seller of Permitted
Receivables and in the absence of any current or anticipated event of default or
termination event under the applicable securitization documents; or
(f) Insolvency Proceedings, Etc. Any Loan Party or any of its Subsidiaries
institutes or consents to the institution of any proceeding under any Debtor
Relief Law, or makes an assignment for the benefit of creditors; or applies for
or consents to the appointment of any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer for it or for all or any material
part of its property; or any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is appointed without the
application or consent of such Person and the appointment continues undischarged
or unstayed for 60 calendar days; or any proceeding under any Debtor Relief Law
relating to any such Person or to all or any part of its property is instituted
without the consent of such Person and continues undismissed or unstayed for 60
calendar days, or an order for relief is entered in any such proceeding;
provided, however, that it shall not be an Event of Default under this
subsection (f) if any Subsidiary of the Borrower to which this subsection
applies does not have annual revenues in excess of 1% of the consolidated
revenues of the Borrower or net worth which constitutes more than 5% of the
Consolidated Net Worth of the Borrower in the fiscal year immediately preceding
the date this subsection first becomes applicable to such Subsidiary; or
(g) Inability to Pay Debts; Attachment. (i) The Borrower or any Subsidiary
becomes unable or admits in writing its inability or fails generally to pay its
debts as they become due, or (ii) any writ or warrant of attachment or execution
or similar process is issued or levied against all or any material part of the
property of any such Person and is not released, vacated or fully bonded within
30 days after its issue or levy; provided, however, that it shall not be an
Event of Default under this subsection (g) if any Subsidiary of the Borrower to
which this subsection applies does not have annual revenues in excess of 1% of
the consolidated revenues of the Borrower or net worth which constitutes more
than 5% of the Consolidated Net Worth of the Borrower in the fiscal year
immediately preceding the date this subsection first becomes applicable to such
Subsidiary; or
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(h) Judgments. There is entered (i) against the Parent in respect of any
matter as to which the Borrower is obligated to indemnify the Parent, or (ii)
against the Borrower or any Subsidiary (A) a final judgment, order or decree for
the payment of money in an aggregate amount exceeding $10,000,000 (to the extent
not covered by independent third-party insurance as to which the insurer does
not dispute coverage), or (B) any non-monetary final judgment, order or decree
that has, or would reasonably be expected to have, a Material Adverse Effect
and, in either case, (I) enforcement proceedings are commenced by any creditor
upon such judgment, order or decree, or (II) there shall be any period of 10
consecutive days during which such judgment, order or decree continues
unsatisfied and during which a stay of enforcement of such judgment, order, or
decree, by reason of a pending appeal or otherwise, shall not be in effect; or
(i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or
Multiemployer Plan which has resulted or would reasonably be expected to result
in liability of the Borrower under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount that would reasonably be
expected to result in a Material Adverse Effect, or (ii) the Borrower or any
ERISA Affiliate fails to pay when due, after the expiration of any applicable
grace period, any installment payment with respect to its withdrawal liability
under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount
that would reasonably be expected to result in a Material Adverse Effect; or
(j) Invalidity of Loan Documents. Any Loan Document, at any time after its
execution and delivery and for any reason other than the agreement of all the
Lenders or satisfaction in full of all the Obligations, ceases to be in full
force and effect, or is declared by a court of competent jurisdiction to be null
and void, invalid or unenforceable in any material respect; or any Loan Party
denies that it has any or further liability or obligation under any Loan
Document, or purports to revoke, terminate or rescind any Loan Document; or
(k) Invalidity of Spin-Off Documents. Any Spin-Off Document, at any time
after its execution and delivery and for any reason other than the satisfaction
in full of all the obligations therein, ceases to be in full force and effect,
or is declared by a court of competent jurisdiction to be null and void, invalid
or unenforceable in any respect; or any party thereto denies that it has any or
further liability or obligation under any Spin-Off Document, or purports to
revoke, terminate or rescind any Spin-Off Document; or
(l) Change of Control. There occurs any Change of Control; or
(m) Spin-Off Consummation. The Spin-Off Consummation Date does not occur on
or before the Spin-Off Deadline.
8.02 REMEDIES UPON EVENT OF DEFAULT. If any Event of Default occurs, the
Administrative Agent shall, at the request of, or may, with the consent of, the
Required Lenders,
(a) declare the commitment of each Lender to make Loans and any obligation
of the L/C Issuer to make L/C Credit Extensions to be terminated, whereupon such
commitments and obligation shall be terminated;
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(b) declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Borrower;
(c) require that the Borrower Cash Collateralize the L/C Obligations (in an
amount equal to the then Outstanding Amount thereof); and
(d) exercise on behalf of itself and the Lenders all rights and remedies
available to it and the Lenders under the Loan Documents or applicable law;
provided, however, that upon the occurrence of any event specified in subsection
(f) of Section 8.01, the obligation of each Lender to make Loans and any
obligation of the L/C Issuer to make L/C Credit Extensions shall automatically
terminate, the unpaid principal amount of all outstanding Loans and all interest
and other amounts as aforesaid shall automatically become due and payable, and
the obligation of the Borrower to Cash Collateralize the L/C Obligations as
aforesaid shall automatically become effective, in each case without further act
of the Administrative Agent or any Lender.
ARTICLE IX.
ADMINISTRATIVE AGENT
9.01 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT.
(a) Each Lender hereby irrevocably (subject to Section 9.09) appoints,
designates and authorizes the Administrative Agent to take such action on its
behalf under the provisions of this Agreement and each other Loan Document and
to exercise such powers and perform such duties as are expressly delegated to it
by the terms of this Agreement or any other Loan Document, together with such
powers as are reasonably incidental thereto. Notwithstanding any provision to
the contrary contained elsewhere herein or in any other Loan Document, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, nor shall the Administrative Agent have or be deemed
to have any fiduciary relationship with any Lender or participant, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent. Without limiting the
generality of the foregoing sentence, the use of the term "agent" herein and in
the other Loan Documents with reference to the Administrative Agent is not
intended to connote any fiduciary or other implied (or express) obligations
arising under agency doctrine of any applicable law. Instead, such term is used
merely as a matter of market custom, and is intended to create or reflect only
an administrative relationship between independent contracting parties.
(b) The L/C Issuer shall act on behalf of the Lenders with respect to any
Letters of Credit issued by it and the documents associated therewith until such
time (and except for so long) as the Administrative Agent may agree at the
request of the Required Lenders to act for the L/C Issuer with respect thereto;
provided, however, that the L/C Issuer shall have all of the benefits and
immunities (i) provided to the Administrative Agent in this Article IX with
respect to any acts taken or omissions suffered by the L/C Issuer in connection
with Letters of Credit
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issued by it or proposed to be issued by it and the application and agreements
for letters of credit pertaining to the Letters of Credit as fully as if the
term "Administrative Agent" as used in this Article IX included the L/C Issuer
with respect to such acts or omissions, and (ii) as additionally provided herein
with respect to the L/C Issuer.
9.02 DELEGATION OF DUTIES. The Administrative Agent may execute any of its
duties under this Agreement or any other Loan Document by or through agents,
employees or attorneys-in-fact and shall be entitled to advice of counsel and
other consultants or experts concerning all matters pertaining to such duties.
The Administrative Agent shall not be responsible for the negligence or
misconduct of any agent or attorney-in-fact that it selects in the absence of
gross negligence or willful misconduct.
9.03 LIABILITY OF ADMINISTRATIVE AGENT. No Agent-Related Person shall (a)
be liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct
in connection with its duties expressly set forth herein), or (b) be responsible
in any manner to any Lender or participant for any recital, statement,
representation or warranty made by any Loan Party or any officer thereof,
contained herein or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by the
Administrative Agent under or in connection with, this Agreement or any other
Loan Document, or the validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Loan Document, or for any failure of
any Loan Party or any other party to any Loan Document to perform its
obligations hereunder or thereunder. No Agent-Related Person shall be under any
obligation to any Lender or participant to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of any Loan Party or any Affiliate thereof.
9.04 RELIANCE BY ADMINISTRATIVE AGENT.
(a) The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, communication, signature, resolution,
representation, notice, consent, certificate, affidavit, letter, telegram,
facsimile, telex or telephone message, statement or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons, and upon advice and statements of
legal counsel (including counsel to any Loan Party), independent accountants and
other experts selected by the Administrative Agent. The Administrative Agent
shall be fully justified in failing or refusing to take any action under any
Loan Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate and, if it so requests, it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement or any
other Loan Document in accordance with a request or consent of the Required
Lenders or all the Lenders, if required hereunder, and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Lenders and participants. Where this Agreement expressly permits or prohibits an
action unless the Required Lenders otherwise determine, the Administrative Agent
shall, and in all other instances, the
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Administrative Agent may, but shall not be required to, initiate any
solicitation for the consent or a vote of the Lenders.
(b) For purposes of determining compliance with the conditions specified in
Section 4.01, each Lender that has signed this Agreement shall be deemed to have
consented to, approved or accepted or to be satisfied with, each document or
other matter either sent by the Administrative Agent to such Lender for consent,
approval, acceptance or satisfaction, or required thereunder to be consented to
or approved by or acceptable or satisfactory to a Lender.
9.05 NOTICE OF DEFAULT. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default,
except with respect to defaults in the payment of principal, interest and fees
required to be paid to the Administrative Agent for the account of the Lenders,
unless the Administrative Agent shall have received written notice from a Lender
or the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default." The
Administrative Agent will notify the Lenders of its receipt of any such notice.
The Administrative Agent shall take such action with respect to such Default or
Event of Default as may be directed by the Required Lenders in accordance with
Article VIII; provided, however, that unless and until the Administrative Agent
has received any such direction, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable or in the best
interest of the Lenders.
9.06 CREDIT DECISION; DISCLOSURE OF INFORMATION BY ADMINISTRATIVE AGENT.
Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Administrative Agent
hereinafter taken, including any consent to and acceptance of any assignment or
review of the affairs of any Loan Party or any Affiliate thereof, shall be
deemed to constitute any representation or warranty by any Agent-Related Person
to any Lender as to any matter, including whether Agent-Related Persons have
disclosed material information in their possession. Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
any Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Loan Parties and their respective Subsidiaries, and all
applicable bank or other regulatory Laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit to the Borrower hereunder. Each Lender also represents that it
will, independently and without reliance upon any Agent-Related Person and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Borrower and the other Loan Parties. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
the Administrative Agent herein, the Administrative Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, prospects, operations, property, financial
and other condition or creditworthiness of any of the Loan Parties or any of
their respective Affiliates which may come into the possession of any
Agent-Related
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Person.
9.07 INDEMNIFICATION OF ADMINISTRATIVE AGENT. Whether or not the
transactions contemplated hereby are consummated, the Lenders shall indemnify
upon demand each Agent-Related Person (to the extent not reimbursed by or on
behalf of any Loan Party and without limiting the obligation of any Loan Party
to do so), based on such Lender's Pro Rata Share, and hold harmless each
Agent-Related Person from and against any and all Indemnified Liabilities
incurred by it; provided, however, that no Lender shall be liable for the
payment to any Agent-Related Person of any portion of such Indemnified
Liabilities resulting from such Person's gross negligence or willful misconduct;
provided, however, that no action taken in accordance with the directions of the
Required Lenders or all Lenders, as the case may be, shall be deemed to
constitute gross negligence or willful misconduct for purposes of this Section.
Without limitation of the foregoing, each Lender shall reimburse the
Administrative Agent upon demand for its ratable share (based on such Lender's
Pro Rata Share) of any costs or out-of-pocket expenses (including Attorney
Costs) incurred by the Administrative Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement, any other
Loan Document, or any document contemplated by or referred to herein, to the
extent that the Administrative Agent is not reimbursed for such expenses by or
on behalf of the Borrower. The undertaking in this Section shall survive
termination of the Commitments, the payment of all Obligations hereunder and the
resignation or replacement of the Administrative Agent.
9.08 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. Bank of America and
its Affiliates may make loans to, issue letters of credit for the account of,
accept deposits from, acquire equity interests in and generally engage in any
kind of banking, trust, financial advisory, underwriting or other business with
each of the Loan Parties and their respective Affiliates as though Bank of
America were not the Administrative Agent or the L/C Issuer hereunder and
without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, Bank of America or its Affiliates may receive
information regarding any Loan Party or its Affiliates (including information
that may be subject to confidentiality obligations in favor of such Loan Party
or such Affiliate) and acknowledge that the Administrative Agent shall be under
no obligation to provide such information to them. With respect to its Loans,
Bank of America shall have the same rights and powers under this Agreement as
any other Lender and may exercise such rights and powers as though it were not
the Administrative Agent or the L/C Issuer, and the terms "Lender" and "Lenders"
include Bank of America in its individual capacity.
9.09 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may resign as
Administrative Agent upon 30 days' notice to the Lenders. If the Administrative
Agent resigns under this Agreement, the Required Lenders shall appoint from
among the Lenders a successor administrative agent for the Lenders which
successor administrative agent shall be consented to by the Borrower at all
times other than during the existence of an Event of Default (which consent of
the Borrower shall not be unreasonably withheld or delayed). If no successor
administrative agent is appointed prior to the effective date of the resignation
of the Administrative Agent, the Administrative Agent may appoint, after
consulting with the Lenders and the Borrower, a successor administrative agent
from among the Lenders. Upon the acceptance of its appointment as successor
administrative agent hereunder, such successor
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administrative agent shall succeed to all the rights, powers and duties of the
retiring Administrative Agent and the term "Administrative Agent" shall mean
such successor administrative agent and the retiring Administrative Agent's
appointment, powers and duties as Administrative Agent shall be terminated.
After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Article IX and Sections 10.03 and
10.13 shall inure to its benefit as to any actions taken or omitted to be taken
by it while it was Administrative Agent under this Agreement. If no successor
administrative agent has accepted appointment as Administrative Agent by the
date which is 30 days following a retiring Administrative Agent's notice of
resignation, the retiring Administrative Agent's resignation shall nevertheless
thereupon become effective and the Lenders shall perform all of the duties of
the Administrative Agent hereunder until such time, if any, as the Required
Lenders appoint a successor agent as provided for above.
9.10 OTHER AGENTS; LEAD MANAGERS. None of the Lenders identified on the
facing page or signature pages of this Agreement as a "syndication agent,"
"documentation agent," "co-agent" or "lead manager" shall have any right, power,
obligation, liability, responsibility or duty under this Agreement other than
those applicable to all Lenders as such. Without limiting the foregoing, none of
the Lenders so identified shall have or be deemed to have any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not relied,
and will not rely, on any of the Lenders so identified in deciding to enter into
this Agreement or in taking or not taking action hereunder.
ARTICLE X.
MISCELLANEOUS
10.01 AMENDMENTS, ETC. No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by the
Borrower or any other Loan Party therefrom, shall be effective unless in writing
signed by the Required Lenders and the Borrower or the applicable Loan Party, as
the case may be, and acknowledged by the Administrative Agent, and each such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no such amendment,
waiver or consent shall, unless in writing and signed by each of the Lenders and
by the Borrower, and acknowledged by the Administrative Agent, do any of the
following:
(a) extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 8.02), except for any such increase
made in accordance with Section 2.13 and consented to by each Lender having an
increased Commitment;
(b) postpone any date fixed by this Agreement or any other Loan Document
for any payment of principal, interest, fees or other amounts due to the Lenders
(or any of them) hereunder or under any other Loan Document;
(c) reduce the principal of, or the rate of interest specified herein on,
any Loan or L/C Borrowing, or any fees or other amounts payable hereunder or
under any other Loan Document; provided, however, that only the consent of the
Required Lenders shall be necessary to amend the definition of "Default Rate" or
to waive any obligation of the Borrower to pay interest at the Default Rate;
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(d) change the percentage of the Aggregate Commitments or of the aggregate
unpaid principal amount of the Loans and L/C Obligations which is required for
the Lenders or any of them to take any action hereunder;
(e) change the Pro Rata Share or Voting Percentage of any Lender (other
than as contemplated by Section 3.06(b));
(f) amend this Section, or Section 2.12, or any provision herein providing
for consent or other action by all the Lenders; or
(g) release Guarantor from the Guaranty other than in accordance with the
terms thereof;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Required Lenders or all
the Lenders, as the case may be, affect the rights or duties of the L/C Issuer
under this Agreement or any Letter of Credit Application relating to any Letter
of Credit issued or to be issued by it; (ii) no amendment, waiver or consent
shall, unless in writing and signed by the Administrative Agent in addition to
the Required Lenders or all the Lenders, as the case may be, affect the rights
or duties of the Administrative Agent under this Agreement or any other Loan
Document; and (iii) the Agent/Arranger Fee Letter may be amended, or rights or
privileges thereunder waived, in a writing executed only by the parties thereto.
Notwithstanding anything to the contrary herein, any Lender that has failed to
fund any portion of the Loans, or participations in L/C Obligations required to
be funded by it hereunder shall not have any right to approve or disapprove any
amendment, waiver or consent hereunder, except that the Pro Rata Share or the
Commitment amount of such Lender may not be increased without the consent of
such Lender.
10.02 NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.
(a) General. Unless otherwise expressly provided herein, all notices and
other communications provided for hereunder shall be in writing (including by
facsimile transmission) and mailed, faxed or delivered, to the address,
facsimile number or (subject to subsection (c) below) electronic mail address
specified for notices on Schedule 10.02; or, in the case of the Borrower, the
Administrative Agent, or the L/C Issuer to such other address as shall be
designated by such party in a notice to the other parties, and in the case of
any other party, to such other address as shall be designated by such party in a
notice to the Borrower, the Administrative Agent, and the L/C Issuer. All such
notices and other communications shall be deemed to be given or made upon the
earlier to occur of (i) actual receipt by the intended recipient and (ii) (A) if
delivered by hand or by courier, when signed for by the intended recipient; (B)
if delivered by first class mail, four Business Days after deposit in the mails,
postage prepaid; (C) if delivered by facsimile, when sent and receipt has been
confirmed by telephone; and (D) if delivered by electronic mail (which form of
delivery is subject to the provisions of subsection (c) below), when delivered;
provided, however, that notices and other communications to the Administrative
Agent, or the L/C Issuer pursuant to Article II shall be in writing and shall
not be effective until actually received by such Person. Any notice or other
communication permitted to be given, made or confirmed by telephone hereunder
shall be given, made or confirmed by means of a telephone call to the intended
recipient at the number specified
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on Schedule 10.02, it being understood and agreed that a voicemail message shall
in no event be effective as a notice, communication or confirmation hereunder.
(b) Effectiveness of Facsimile Documents and Signatures. Loan Documents may
be transmitted and/or signed by facsimile. The effectiveness of any such
documents and signatures shall, subject to applicable Law, have the same force
and effect as manually-signed originals and shall be binding on all Loan
Parties, the Administrative Agent and the Lenders. The Administrative Agent may
also require that any such documents and signatures be confirmed by a
manually-signed original thereof; provided, however, that the failure to request
or deliver the same shall not limit the effectiveness of any facsimile document
or signature.
(c) Limited Use of Electronic Mail. Electronic mail and internet and
intranet websites may be used only to distribute routine communications, such as
financial statements and other information, and to distribute Loan Documents for
execution by the parties thereto, and may not be used for any other purpose.
(d) Reliance by Administrative Agent and Lenders. The Administrative Agent
and the Lenders shall be entitled to rely and act upon any notices (including
telephonic Loan Notices purportedly given by or on behalf of the Borrower even
if (i) such notices were not made in a manner specified herein, were incomplete
or were not preceded or followed by any other form of notice specified herein,
or (ii) the terms thereof, as understood by the recipient, varied from any
confirmation thereof. The Borrower shall indemnify each Agent-Related Person and
each Lender from all losses, costs, expenses and liabilities resulting from the
reliance by such Person on each notice purportedly given by or on behalf of the
Borrower. All telephonic notices to and other communications with the
Administrative Agent may be recorded by the Administrative Agent, and each of
the parties hereto hereby consents to such recording.
10.03 NO WAIVER; CUMULATIVE REMEDIES. No failure by any Lender or the
Administrative Agent to exercise, and no delay by any such Person in exercising,
any right, remedy, power or privilege hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein or therein provided are cumulative and not
exclusive of any rights, remedies, powers and privileges provided by law.
10.04 ATTORNEY COSTS, EXPENSES AND TAXES. The Borrower agrees (a) to pay or
reimburse the Administrative Agent for all costs and expenses incurred in
connection with the development, preparation, negotiation and execution of this
Agreement and the other Loan Documents and any amendment, waiver, consent or
other modification of the provisions hereof and thereof (whether or not the
transactions contemplated hereby or thereby are consummated), and the
consummation and administration of the transactions contemplated hereby and
thereby, including all Attorney Costs, and (b) to pay or reimburse the
Administrative Agent and each Lender for all costs and expenses incurred in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement or the other Loan Documents (including
all such costs and expenses incurred during any "workout" or restructuring in
respect of the Obligations and during any legal proceeding, including any
proceeding under any Debtor Relief Law), including all Attorney Costs. The
foregoing costs and
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expenses shall include all search, filing, recording, title insurance and
appraisal charges and fees and taxes related thereto, and other out-of-pocket
expenses incurred by the Administrative Agent and the cost of independent public
accountants and other outside experts retained by the Administrative Agent or
any Lender. The agreements in this Section shall survive the termination of the
Commitments and repayment of all the other Obligations.
10.05 INDEMNIFICATION BY THE BORROWER. Whether or not the transactions
contemplated hereby are consummated, the Borrower agrees to indemnify, save and
hold harmless each Agent-Related Person, each Lender and their respective
Affiliates, directors, officers, employees, counsel, agents and
attorneys-in-fact (collectively the "Indemnitees") from and against: (a) any and
all claims, demands, actions or causes of action that are asserted against any
Indemnitee by any Person (other than the Administrative Agent or any Lender)
relating directly or indirectly to a claim, demand, action or cause of action
that such Person asserts or may assert against any Loan Party, any Affiliate of
any Loan Party or any of their respective officers or directors; (b) any and all
claims, demands, actions or causes of action that may at any time (including at
any time following repayment of the Obligations and the resignation or removal
of the Administrative Agent or the replacement of any Lender) be asserted or
imposed against any Indemnitee, arising out of or relating to, the Loan
Documents, any predecessor loan documents, the Commitments, the use or
contemplated use of the proceeds of any Credit Extension, or the relationship of
any Loan Party, the Administrative Agent and the Lenders under this Agreement or
any other Loan Document; (c) any administrative or investigative proceeding by
any Governmental Authority arising out of or related to a claim, demand, action
or cause of action described in subsection (a) or (b) above; and (d) any and all
liabilities (including liabilities under indemnities), losses, costs or expenses
(including Attorney Costs) that any Indemnitee suffers or incurs as a result of
the assertion of any foregoing claim, demand, action, cause of action or
proceeding, or as a result of the preparation of any defense in connection with
any foregoing claim, demand, action, cause of action or proceeding, in all
cases, and whether or not an Indemnitee is a party to such claim, demand,
action, cause of action or proceeding (all the foregoing, collectively, the
"Indemnified Liabilities"); provided that no Indemnitee shall be entitled to
indemnification for any claim caused by its own gross negligence or willful
misconduct or for any loss asserted against it by another Indemnitee. The
agreements in this Section shall survive the termination of the Commitments and
repayment of all the other Obligations. At the election of any Indemnitee, the
Borrower shall defend such Indemnitee using legal counsel satisfactory to such
Indemnitee in such Person's sole discretion, at the sole cost and expense of the
Borrower; provided, however, that the Borrower shall only be obligated to hire
one counsel to represent all of the Lenders unless any Lender advises the
Borrower that its legal counsel has advised it that its interest is materially
different from that of the other Lenders and it would not be adequately
represented without its own separate counsel, in which case the Borrower shall
hire separate counsel for such Lender, satisfactory to such Lender. All amounts
owing under this Section 10.05 shall be paid within 30 days after demand.
10.06 PAYMENTS SET ASIDE. To the extent that the Borrower makes a payment
to the Administrative Agent or any Lender, or the Administrative Agent or any
Lender exercises its right of set-off, and such payment or the proceeds of such
set-off or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any
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proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such set-off had not occurred, and (b) each Lender
severally agrees to pay to the Administrative Agent upon demand its applicable
share of any amount so recovered from or repaid by the Administrative Agent,
plus interest thereon from the date of such demand to the date such payment is
made at a rate per annum equal to the Federal Funds Rate from time to time in
effect.
10.07 SUCCESSORS AND ASSIGNS.
(a) The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that the Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
each Lender (and any attempted assignment or transfer by the Borrower without
such consent shall be null and void). Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby and, to the
extent expressly contemplated hereby, the Indemnitees) any legal or equitable
right, remedy or claim under or by reason of this Agreement.
(b) Subject to the prior consent of the Administrative Agent, the L/C
Issuer and, provided there exists no Default or Event of Default, the Borrower
(such Borrower consent not to be unreasonably withheld), any Lender may assign
to one or more Eligible Assignees all or a portion of its rights and obligations
under this Agreement, including all or a portion of its Commitment and the Loans
(including for purposes of this subsection (b), participations in L/C
Obligations at the time owing to it); provided that (i) except in the case of an
assignment of the entire remaining amount of the assigning Lender's Commitment
and the Loans at the time owing to it or in the case of an assignment to a
Lender or an Affiliate of a Lender or an Approved Fund with respect to a Lender,
the aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) subject to each such assignment, determined as of the
date the Assignment and Acceptance with respect to such assignment is delivered
to the Administrative Agent, shall not be less than $5,000,000 unless the
Administrative Agent otherwise consents, (ii) each partial assignment shall be
made as an assignment of a proportionate part of all the assigning Lender's
rights and obligations under this Agreement with respect to the Loans or the
Commitment assigned, and (iii) the parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Acceptance, together with
a processing and recordation fee of $4,000. Subject to acceptance and recording
thereof by the Administrative Agent pursuant to subsection (c) of this Section,
from and after the effective date specified in each Assignment and Acceptance,
the Eligible Assignee thereunder shall be a party hereto and, to the extent of
the interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender's
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections 3.01,
10.04 and 10.05). Upon request, the Borrower (at its expense) shall execute and
deliver new or replacement Loan Notes to the assigning Lender and the assignee
Lender. Any assignment or
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transfer by a Lender of rights or obligations under this Agreement that does not
comply with this subsection shall be treated for purposes of this Agreement as a
sale by such Lender of a participation in such rights and obligations in
accordance with subsection (d) of this Section.
(c) The Administrative Agent, acting solely for this purpose as an agent of
the Borrower, shall maintain at the Administrative Agent's Office a copy of each
Assignment and Acceptance delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitments of, and principal
amount of the Loans and L/C Obligations owing to, each Lender pursuant to the
terms hereof from time to time (the "Register"). The entries in the Register
shall be conclusive, and the Borrower, the Administrative Agent and the Lenders
may treat each Person whose name is recorded in the Register pursuant to the
terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by the Borrower and any Lender, at any reasonable time and from time
to time upon reasonable prior notice.
(d) Any Lender may, without the consent of, or notice to, the Borrower or
the Administrative Agent, sell participations to one or more banks or other
entities (a "Participant") in all or a portion of such Lender's rights and/or
obligations under this Agreement (including all or a portion of its Commitment
and/or the Loans (including such Lender's participations in L/C Obligations)
owing to it); provided that (i) such Lender's obligations under this Agreement
shall remain unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (iii) the
Borrower, the Administrative Agent and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, waiver or other modification
that would (A) postpone any date upon which any payment of money is scheduled to
be paid to such Participant (B) reduce the principal, interest, fees or other
amounts payable to such Participant, or (C) release the Guarantor from the
Guaranty. Subject to subsection (e) of this Section, the Borrower agrees that
each Participant shall be entitled to the benefits of Sections 3.01, 3.04 and
3.05 to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to subsection (b) of this Section. To the extent permitted
by law, each Participant also shall be entitled to the benefits of Section 10.09
as though it were a Lender, provided such Participant agrees to be subject to
Section 2.12 as though it were a Lender.
(e) A Participant shall not be entitled to receive any greater payment
under Section 3.01 or 3.04 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower's
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 3.01 unless the Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 10.15 as though
it were a Lender.
(f) Any Lender may at any time pledge or assign a security interest in all
or any portion of its rights under this Agreement (including under its Loan
Notes, if any) to secure
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obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release a Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.
(g) If the consent of the Borrower to an assignment or to an Eligible
Assignee is required hereunder (including a consent to an assignment which does
not meet the minimum assignment threshold specified in clause (i) of the proviso
to the first sentence of Section 10.07(b)), the Borrower shall be deemed to have
given its consent five Business Days after the date notice thereof has been
delivered by the assigning Lender (through the Administrative Agent) unless such
consent is expressly refused by the Borrower prior to such fifth Business Day.
(h) As used herein, the following terms have the following meanings:
"Approved Fund" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a Lender; (c)
an Approved Fund; and (d) any other Person (other than a natural Person)
approved by the Administrative Agent, in the case of any assignment of a Loan,
and the L/C Issuer, and unless (x) such Person is taking delivery of an
assignment in connection with physical settlement of a credit derivatives
transaction or (y) an Event of Default has occurred and is continuing, the
Borrower (each such approval not to be unreasonably withheld or delayed).
"Fund" means any Person (other than a natural Person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
(i) Notwithstanding anything to the contrary contained herein, if at any
time Bank of America assigns all of its Commitment and Loans pursuant to
subsection (b) above, Bank of America may, upon 30 days' notice to the Borrower
and the Lenders, resign as L/C Issuer. The Borrower shall be entitled to appoint
from among the Lenders a successor L/C Issuer hereunder; provided, however, that
no failure by the Borrower to appoint any such successor shall affect the
resignation of Bank of America as L/C Issuer. Bank of America shall retain all
the rights and obligations of the L/C Issuer hereunder with respect to all
Letters of Credit outstanding as of the effective date of its resignation as L/C
Issuer and all L/C Obligations with respect thereto (including the right to
require the Lenders to make Base Rate Loans or fund participations in
Unreimbursed Amounts pursuant to Section 2.03(c)).
10.08 CONFIDENTIALITY. Each of the Administrative Agent and the Lenders
agrees to maintain the confidentiality of the Information (as defined below),
except that Information may be disclosed (a) to its and its Affiliates'
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential); (b) to the extent requested
by any regulatory authority;
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(c) to the extent required by applicable laws or regulations or by any subpoena
or similar legal process; (d) to any other party to this Agreement; (e) in
connection with the exercise of any remedies hereunder or any suit, action or
proceeding relating to this Agreement or the enforcement of rights hereunder;
(f) subject to an agreement containing provisions substantially the same as
those of this Section, to (i) any Eligible Assignee of or Participant in, or any
prospective Eligible Assignee of or Participant in, any of its rights or
obligations under this Agreement or (ii) any direct or indirect contractual
counterparty or prospective counterparty (or such contractual counterparty's or
prospective counterparty's professional advisor) to any credit derivative
transaction relating to obligations of the Borrower; (g) with the consent of the
Borrower; (h) to the extent such Information (i) becomes publicly available
other than as a result of a breach of this Section or (ii) becomes available to
the Administrative Agent or any Lender on a nonconfidential basis from a source
other than the Borrower; or (i) to the National Association of Insurance
Commissioners or any other similar organization or any nationally recognized
rating agency that requires access to information about a Lender's or its
Affiliates' investment portfolio in connection with ratings issued with respect
to such Lender or its Affiliates. For the purposes of this Section,
"Information" means all information received from the Borrower relating to the
Borrower or its business, other than any such information that is available to
the Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by the Borrower; provided that, in the case of information received
from the Borrower after the date hereof, such information is clearly identified
in writing at the time of delivery as confidential. Any Person required to
maintain the confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.
10.09 SET-OFF. In addition to any rights and remedies of the Lenders
provided by law, upon the occurrence and during the continuance of any Event of
Default, each Lender is authorized at any time and from time to time, without
prior notice to the Borrower or any other Loan Party, any such notice being
waived by the Borrower (on its own behalf and on behalf of each Loan Party) to
the fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held by,
and other indebtedness at any time owing by, such Lender to or for the credit or
the account of the respective Loan Parties against any and all Obligations owing
to such Lender, now or hereafter existing, irrespective of whether or not the
Administrative Agent or such Lender shall have made demand under this Agreement
or any other Loan Document and although such Obligations may be contingent or
unmatured. Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such set-off and application made by such Lender;
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application.
10.10 INTEREST RATE LIMITATION. Notwithstanding anything to the contrary
contained in any Loan Document, the interest paid or agreed to be paid under the
Loan Documents shall not exceed the maximum rate of non-usurious interest
permitted by applicable Law (the "Maximum Rate"). If the Administrative Agent or
any Lender shall receive interest in an amount that exceeds the Maximum Rate,
the excess interest shall be applied to the principal of the Loans or, if it
exceeds such unpaid principal, refunded to the Borrower. In determining whether
the interest contracted for, charged, or received by the Administrative Agent or
a Lender exceeds the
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Maximum Rate, such Person may, to the extent permitted by applicable Law, (a)
characterize any payment that is not principal as an expense, fee, or premium
rather than interest, (b) exclude voluntary prepayments and the effects thereof,
and (c) amortize, prorate, allocate, and spread in equal or unequal parts the
total amount of interest throughout the contemplated term of the Obligations.
10.11 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
10.12 INTEGRATION. This Agreement, together with the other Loan Documents,
comprises the complete and integrated agreement of the parties on the subject
matter hereof and thereof and supersedes all prior agreements, written or oral,
on such subject matter. In the event of any conflict between the provisions of
this Agreement and those of any other Loan Document, the provisions of this
Agreement shall control; provided that the inclusion of supplemental rights or
remedies in favor of the Administrative Agent or the Lenders in any other Loan
Document shall not be deemed a conflict with this Agreement. Each Loan Document
was drafted with the joint participation of the respective parties thereto and
shall be construed neither against nor in favor of any party, but rather in
accordance with the fair meaning thereof.
10.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the
Administrative Agent and each Lender, regardless of any investigation made by
the Administrative Agent or any Lender or on their behalf and notwithstanding
that the Administrative Agent or any Lender may have had notice or knowledge of
any Default or Event of Default at the time of any Credit Extension, and shall
continue in full force and effect as long as any Loan or any other Obligation
shall remain unpaid or unsatisfied or any Letter of Credit shall remain
outstanding.
10.14 SEVERABILITY. Any provision of this Agreement and the other Loan
Documents to which the Borrower is a party that is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions thereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
10.15 FOREIGN LENDERS. Each Lender that is a "foreign corporation,
partnership or trust" within the meaning of the Code (a "Foreign Lender") shall
deliver to the Administrative Agent, prior to receipt of any payment subject to
withholding under the Code (or after accepting an assignment of an interest
herein), two duly signed completed copies of either IRS Form W-8BEN or any
successor thereto (relating to such Person and entitling it to an exemption from
withholding tax on all payments to be made to such Person by the Borrower
pursuant to this Agreement) or IRS Form W-8ECI or any successor thereto
(relating to all payments to be made to such Person by the Borrower pursuant to
this Agreement) or such other evidence satisfactory to the Borrower and the
Administrative Agent that such Person is entitled to an exemption from
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U.S. withholding tax. Thereafter and from time to time, each such Person shall
(a) promptly submit to the Administrative Agent such additional duly completed
and signed copies of one of such forms (or such successor forms as shall be
adopted from time to time by the relevant United States taxing authorities) as
may then be available under then current United States laws and regulations to
avoid, or such evidence as is satisfactory to the Borrower and the
Administrative Agent of any available exemption from, or reduction of, United
States withholding taxes in respect of all payments to be made to such Person by
the Borrower pursuant to this Agreement, (b) promptly notify the Administrative
Agent of any change in circumstances which would modify or render invalid any
claimed exemption or reduction, and (c) take such steps as shall not be
materially disadvantageous to it, in the reasonable judgment of such Lender, and
as may be reasonably necessary (including the re-designation of its Lending
Office) to avoid any requirement of applicable Laws that the Borrower make any
deduction or withholding for taxes from amounts payable to such Person. If such
Person fails to deliver the above forms or other documentation, then the
Administrative Agent may withhold from any interest payment to such Person an
amount equivalent to the applicable withholding tax imposed by Sections 1441 and
1442 of the Code, without reduction. If any Governmental Authority asserts that
the Administrative Agent did not properly withhold any tax or other amount from
payments made in respect of such Person, such Person shall indemnify the
Administrative Agent therefor, including all penalties and interest, any taxes
imposed by any jurisdiction on the amounts payable to the Administrative Agent
under this Section, and costs and expenses (including Attorney Costs) of the
Administrative Agent. The obligation of the Lenders under this Section shall
survive the payment of all Obligations and the resignation or replacement of the
Administrative Agent.
10.16 REMOVAL AND REPLACEMENT OF LENDERS.
(a) Under any circumstances set forth herein providing that the Borrower
shall have the right to remove or replace a Lender as a party to this Agreement,
the Borrower may, upon notice to such Lender and the Administrative Agent, (i)
remove such Lender by terminating such Lender's Commitment or (ii) replace such
Lender by causing such Lender to assign its Commitment (without payment of any
assignment fee) pursuant to Section 10.07(b) to one or more other Lenders or
Eligible Assignees procured by the Borrower; provided, however, that if the
Borrower elects to exercise such right with respect to any Lender pursuant to
Section 3.06(b), it shall be obligated to remove or replace, as the case may be,
all Lenders that have made similar requests for compensation pursuant to Section
3.01 or 3.04. The Borrower shall (x) pay in full all principal, interest, fees
and other amounts owing to such Lender through the date of termination or
assignment (including any amounts payable pursuant to Section 3.05), (y) provide
appropriate assurances and indemnities (which may include letters of credit) to
the L/C Issuer as such L/C Issuer may reasonably require with respect to any
continuing obligation to purchase participation interests in any L/C Obligations
then outstanding, and (z) release such Lender from its obligations under the
Loan Documents. Any Lender being replaced shall execute and deliver an
Assignment and Acceptance with respect to such Lender's Commitment and
outstanding Credit Extensions. The Administrative Agent shall distribute an
amended Schedule 2.01, which shall be deemed incorporated into this Agreement,
to reflect changes in the identities of the Lenders and adjustments of their
respective Commitments and/or Pro Rata Shares resulting from any such removal or
replacement. The Borrower may not under any circumstances remove or replace the
Lender that is the L/C Issuer without causing such Lender simultaneously to be
replaced as L/C Issuer and without causing such Lender to be released from all
liability in
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respect of then-outstanding Letters of Credit, pursuant to documentation in form
and substance satisfactory to such Lender.
(b) In order to make all the Lenders' interests in any outstanding Credit
Extensions ratable in accordance with any revised Pro Rata Shares after giving
effect to the removal or replacement of a Lender, the Borrower shall pay or
prepay, if necessary, on the effective date thereof, all outstanding Loans of
all Lenders, together with any amounts due under Section 3.05. The Borrower may
then request Loans from the Lenders in accordance with their revised Pro Rata
Shares. The Borrower may net any payments required hereunder against any funds
being provided by any Lender or Eligible Assignee replacing a terminating
Lender. The effect for purposes of this Agreement shall be the same as if
separate transfers of funds had been made with respect thereto.
(c) This Section shall supersede any provision in Section 10.01 to the
contrary.
10.17 GOVERNING LAW.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAW OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE ADMINISTRATIVE AGENT AND
EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX
SITTING IN THE BOROUGH OF MANHATTAN, CITY OF NEW YORK, OR OF THE UNITED STATES
FOR THE SOUTHERN DISTRICT OF SUCH STATE, AND BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER CONSENTS, FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF
THOSE COURTS. THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER IRREVOCABLY
WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON
THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN
DOCUMENT OR OTHER DOCUMENT RELATED THERETO. THE BORROWER, THE ADMINISTRATIVE
AGENT AND EACH LENDER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH
STATE.
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10.18 WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY TO THIS AGREEMENT HEREBY
EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR
RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH
RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR
TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
NEW CERIDIAN CORPORATION,
as Borrower
By: /s/ Xxxx X. Xxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Vice President and Treasurer
BANK OF AMERICA, N.A.,
as Administrative Agent, Lender
and L/C Issuer
By: /s/ Xxxxx X. Leader
------------------------------------
Name: Xxxxx X. Leader
Title: Managing Director
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AMSOUTH BANK, as a Lender
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Corp. Bank Officer
BANK ONE, N.A., as a Lender
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: First Vice President
FIRST UNION NATIONAL BANK, as a Lender
By: /s/ Xxxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Assistant Vice President
MELLON BANK, N.A., as a Lender
By: /s/ Xxxxx X. Xxxxx
------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
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PNC BANK, NATIONAL ASSOCIATION,
as a Lender
By: /s/ Xxxxx Xxxxx Xx.
------------------------------------
Name: Xxxxx Xxxxx Xx.
Title: Commercial Banking Officer
THE BANK OF NEW YORK, as a Lender
By: /s/ Xxxx Xxxx Xxxxxxx
------------------------------------
Name: Xxxx Xxxx Xxxxxxx
Title: Vice President
THE BANK OF TOKYO-MITSUBISHI, LTD.,
CHICAGO BRANCH, as a Lender
By: /s/ Xxxxxxx XxXxx
------------------------------------
Name: Xxxxxxx XxXxx
Title: Vice President and Manager
THE CHASE MANHATTAN BANK, as a Lender
By: /s/ Xxxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President
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THE ROYAL BANK OF SCOTLAND PLC,
as a Lender
By: /s/ Xxxxx Xxxxxxx
------------------------------------
Name: Xxxxx Xxxxxxx
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION,
as a Lender
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Senior Vice President
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as a Lender
By: /s/ Xxxx X. Xxxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxxx
Title: Assistant Vice President
By: /s/ Xxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
86. New Ceridian Credit Agreement
