EXHIBIT 10.20
[W&C Draft: 12/8/97]
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CREDIT AGREEMENT
among
ALLIANCE IMAGING, INC.,
VARIOUS LENDING INSTITUTIONS,
and
BANKERS TRUST COMPANY,
AS AGENT
________________________________
Dated as of December 18, 1997
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TABLE OF CONTENTS
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SECTION 1. Amount and Terms of Credit............................................ 1
1.01 Commitments......................................................... 1
1.02 Minimum Borrowing Amounts, etc...................................... 5
1.03 Notice of Borrowing................................................. 5
1.04 Disbursement of Funds............................................... 6
1.05 Notes............................................................... 7
1.06 Conversions......................................................... 8
1.07 Pro Rata Borrowings................................................. 9
1.08 Interest............................................................ 9
1.09 Interest Periods.................................................... 10
1.10 Increased Costs; Illegality; etc.................................... 11
1.11 Compensation........................................................ 14
1.12 Change of Lending Office............................................ 14
1.13 Replacement of Banks................................................ 15
SECTION 2. Letters of Credit..................................................... 16
2.01 Letters of Credit................................................... 16
2.02 Letter of Credit Requests........................................... 18
2.03 Letter of Credit Participations..................................... 19
2.04 Agreement to Repay Letter of Credit Drawings........................ 21
2.05 Increased Costs..................................................... 22
SECTION 3. Fees; Commitments..................................................... 23
3.01 Fees................................................................ 23
3.02 Voluntary Termination or Reduction of Total Unutilized Revolving
Loan Commitment................................................... 25
3.03 Mandatory Reduction of Commitments.................................. 26
SECTION 4. Payments.............................................................. 27
4.01 Voluntary Prepayments............................................... 27
4.02 Mandatory Repayments and Commitment Reductions...................... 28
4.03 Method and Place of Payment......................................... 35
4.04 Net Payments........................................................ 35
SECTION 5. Conditions Precedent to Initial Credit Events......................... 38
5.01 Execution of Agreement; Notes....................................... 38
(i)
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5.02 Officer's Certificate............................................... 38
5.03 Opinions of Counsel................................................. 38
5.04 Corporate Documents; Proceedings.................................... 39
5.05 Adverse Change, etc................................................. 39
5.06 Litigation.......................................................... 40
5.07 Approvals........................................................... 40
5.08 Recapitalization, Financing Transactions, etc............................... 40
5.09 ......................................................................... 41
Refinancing.................................................................... 41
......................................................................... 42
5.10 Security Documents; etc............................................. 42
5.11 Subsidiaries Guaranty............................................... 43
Employee Benefit Plans; Shareholders' Agreements; Management
Agreements; Employment Agreements; Collective Bargaining
Agreements; Existing Indebtedness Agreements; Material
Contracts; Tax Allocation Agreements............................. 44
Consent Letter.......................................................... 45
5.14 Solvency Certificate; Insurance Certificates........................ 45
5.15 Financial Statements; Pro Forma Balance Sheet; Projections.......... 46
Payment of Fees......................................................... 46
SECTION 6. Conditions Precedent to All Credit Events............................. 46
6.01 No Default; Representations and Warranties.......................... 46
6.02 Notice of Borrowing; Letter of Credit Request....................... 46
SECTION 7. Representations and Warranties........................................ 47
7.01 Corporate Status.................................................... 47
7.02 Company Power and Authority......................................... 47
7.03 No Violation........................................................ 48
7.04 Litigation.......................................................... 48
7.05 Use of Proceeds; Margin Regulations................................. 48
7.06 Governmental Approvals.............................................. 49
7.07 Investment Company Act.............................................. 49
7.08 Public Utility Holding Company Act.................................. 49
7.09 True and Complete Disclosure........................................ 49
7.10 Financial Condition; Financial Statements........................... 50
7.11 Security Interests.................................................. 51
(ii)
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7.12 Compliance with ERISA............................................... 51
7.13 Capitalization...................................................... 52
7.14 Subsidiaries........................................................ 53
7.15 Intellectual Property, etc.......................................... 53
7.16 Compliance with Statutes, etc....................................... 53
7.17 Environmental Matters............................................... 53
7.18 Properties.......................................................... 54
7.19 Labor Relations..................................................... 54
7.20 Tax Returns and Payments............................................ 55
7.21 Existing Indebtedness............................................... 55
7.22 Insurance........................................................... 55
7.23 Representations and Warranties in Other Documents................... 55
7.24 Transaction......................................................... 56
7.25 Special Purpose Corporations........................................ 56
7.26 Subordination....................................................... 56
SECTION 8. Affirmative Covenants................................................. 56
8.01 Information Covenants............................................... 57
8.02 Books, Records and Inspections...................................... 60
8.03 Insurance........................................................... 61
8.04 Payment of Taxes.................................................... 62
8.05 Corporate Franchises................................................ 62
8.06 Compliance with Statutes; etc....................................... 62
8.07 Compliance with Environmental Laws.................................. 62
8.08 ERISA............................................................... 63
8.09 Good Repair......................................................... 65
8.10 End of Fiscal Years; Fiscal Quarters................................ 65
8.11 Additional Security; Further Assurances............................. 65
8.12 Foreign Subsidiaries Security....................................... 66
8.13 Ownership of Subsidiaries........................................... 67
8.14 Permitted Acquisitions.............................................. 67
8.15 Maintenance of Company Separateness................................. 69
8.16 Performance of Obligations.......................................... 69
8.17 Use of Proceeds..................................................... 69
SECTION 9. Negative Covenants.................................................... 69
9.01 Changes in Business................................................. 69
9.02 Consolidation; Merger; Sale or Purchase of Assets; etc............ 69
9.03 Liens............................................................. 73
9.04 Indebtedness...................................................... 75
9.05 Advances; Investments; Loans........................................ 77
(iii)
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9.06 Dividends; etc...................................................... 79
9.07 Transactions with Affiliates........................................ 80
9.08 Consolidated Fixed Charge Coverage Ratio............................ 81
9.09 Minimum Consolidated EBITDA......................................... 82
9.10 Consolidated Interest Coverage Ratio................................ 83
9.11 Adjusted Total Leverage Ratio....................................... 84
9.12 Limitation on Voluntary Payments and Modifications of
Indebtedness; Modifications of Certificate of Incorporation, By-
Laws and Certain Other Agreements; Issuances of Capital Stock;
etc.............................................................. 85
9.13 Limitation on Issuance of Capital Stock............................. 86
9.14 Limitation on Certain Restrictions on Subsidiaries.................. 87
9.15 Limitation on the Creation of Subsidiaries and Joint Ventures....... 88
SECTION 10. Events of Default.................................................... 89
10.01 Payments........................................................... 89
10.02 Representations, etc............................................... 89
10.03 Covenants.......................................................... 89
10.04 Default Under Other Agreements..................................... 89
10.05 Bankruptcy, etc.................................................... 90
10.06 ERISA.............................................................. 90
10.07 Security Documents................................................. 91
10.08 Subsidiaries Guaranty.............................................. 91
10.09 Judgments.......................................................... 91
10.10 Ownership.......................................................... 91
SECTION 11. Definitions.......................................................... 92
SECTION 12. The Agent............................................................130
12.01 Appointment........................................................130
12.02 Delegation of Duties...............................................131
12.03 Exculpatory Provisions.............................................131
12.04 Reliance by Agent..................................................131
12.05 Notice of Default..................................................132
12.06 Nonreliance on Agent and Other Banks...............................132
12.07 Indemnification....................................................133
12.08 Agent in its Individual Capacity...................................133
12.09 Holders............................................................133
12.10 Resignation of the Agent...........................................134
SECTION 13. Miscellaneous........................................................134
(iv)
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13.01 Payment of Expenses, etc...........................................134
13.02 Right of Setoff....................................................135
13.03 Notices............................................................135
13.04 Benefit of Agreement...............................................136
13.05 No Waiver; Remedies Cumulative.....................................138
13.06 Payments Pro Rata..................................................138
13.07 Calculations; Computations.........................................139
13.08 Governing Law; Submission to Jurisdiction; Venue...................139
13.09 Counterparts.......................................................140
13.10 Effectiveness......................................................140
13.11 Headings Descriptive...............................................141
13.12 Amendment or Waiver; etc...........................................141
13.13 Survival...........................................................142
13.14 Domicile of Loans and Commitments..................................142
13.15 Confidentiality....................................................143
13.16 Waiver of Jury Trial...............................................143
13.17 Register...........................................................143
13.18 Limitation on Additional Amounts, etc..............................144
13.19 Post-Closing Actions...............................................144
(v)
SCHEDULE I List of Banks and Commitments
SCHEDULE II Bank Addresses
SCHEDULE III Real Properties
SCHEDULE IV Existing Indebtedness
SCHEDULE V Pension Plans
SCHEDULE VI Existing Investments
SCHEDULE VII Subsidiaries
SCHEDULE VIII Insurance
SCHEDULE IX Existing Liens
SCHEDULE X Capitalization
EXHIBIT A -- Form of Notice of Borrowing
EXHIBIT B-1 -- Form of Term Note
EXHIBIT B-2 -- Form of Revolving Note
EXHIBIT B-3 -- Form of Swingline Note
EXHIBIT C -- Form of Letter of Credit Request
EXHIBIT D -- Form of Section 4.04(b)(ii) Certificate
EXHIBIT E-1 -- Form of Opinion of X'Xxxxxxxx Graev & Karabell, LLP,
special counsel to the Credit Parties
EXHIBIT E-2 -- Form of Opinion of Irell & Xxxxxxx LLP
EXHIBIT F -- Form of Officers' Certificate
EXHIBIT G -- Form of Pledge Agreement
EXHIBIT H -- Form of Security Agreement
EXHIBIT I -- Form of Subsidiaries Guaranty
EXHIBIT J -- Form of Consent Letter
EXHIBIT K -- Form of Solvency Certificate
EXHIBIT L -- Form of Assignment and Assumption Agreement
EXHIBIT M -- Form of Intercompany Note
EXHIBIT N -- Form of Shareholder Subordinated Note
(vi)
CREDIT AGREEMENT, dated as of December 18, 1997, among ALLIANCE
IMAGING, INC., a Delaware corporation (the "Borrower"), the lenders from time to
time party hereto (each, a "Bank" and, collectively, the "Banks"), and BANKERS
TRUST COMPANY, as Agent (in such capacity, the "Agent"). Unless otherwise
defined herein, all capitalized terms used herein and defined in Section 11 are
used herein as so defined.
W I T N E S S E T H :
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WHEREAS, subject to and upon the terms and conditions herein set
forth, the Banks are willing to make available to the Borrower the credit
facilities provided for herein; and
NOW, THEREFORE, IT IS AGREED:
SECTION 1. Amount and Terms of Credit.
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1.01 Commitments. (a) Subject to and upon the terms and conditions
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set forth herein, each Bank with a Term Loan Commitment severally agrees to make
a term loan or term loans (each, a "Term Loan" and, collectively, the "Term
Loans"), which Term Loans:
(i) shall be incurred by the Borrower pursuant to a single
drawing on the Initial Borrowing Date for the purposes described in Section
7.05(a);
(ii) shall be denominated in U.S. Dollars;
(iii) except as hereafter provided, shall, at the option of the
Borrower, be incurred and maintained as, and/or converted into, Base Rate
Loans or Eurodollar Loans, provided, that (x) except as otherwise
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specifically provided in Section 1.10(b), all Term Loans made as part of
the same Borrowing shall at all times consist of Term Loans of the same
Type and (y) unless the Agent has determined that the Syndication Date has
occurred (at which time this clause (y) shall no longer be applicable), no
more than three Borrowings of Term Loans to be maintained as Eurodollar
Loans may be incurred prior to the 90th day after the Initial Borrowing
Date (or, if later, the last day of the Interest Period applicable to the
third Borrowing of Eurodollar Loans referred to below), each of which
Borrowings of Eurodollar Loans may only have an Interest Period of one
month, and the first of which Borrowings may only be made on, or within
five Business Days after, the Initial Borrowing Date, the second of which
Borrowings may only be made on the last day of the Interest Period of the
first such Borrowing and the third of which Borrowings may only be made on
the last day of the Interest Period of the second such Borrowing; and
(iv) shall not exceed for any Bank, in initial principal amount
for the Term Loans being made by such Bank on the Initial Borrowing Date,
that amount which equals the Term Loan Commitment of such Bank as in effect
on the Initial Borrowing Date (before giving effect to any reductions
thereto on such date pursuant to Section 3.03(b)(i) but after giving effect
to any reductions thereto on or prior to such date pursuant to Section
3.03(b)(ii)).
Once repaid, Term Loans incurred hereunder may not be reborrowed.
(b) Subject to and upon the terms and conditions herein set forth,
each RL Bank severally agrees, at any time and from time to time on and after
the Initial Borrowing Date and prior to the Revolving Loan Maturity Date, to
make a revolving loan or revolving loans (each, a "Revolving Loan" and,
collectively, the "Revolving Loans") to the Borrower, which Revolving Loans:
(i) shall be denominated in U.S. Dollars;
(ii) shall, at the option of the Borrower, be incurred and
maintained as, and/or converted into, Base Rate Loans or Eurodollar Loans,
provided that (x) except as otherwise specifically provided in Section
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1.10(b), all Revolving Loans made as part of the same Borrowing shall at
all times be of the same Type and (y) unless the Agent has determined that
the Syndication Date has occurred, no more than three Borrowings of
Revolving Loans to be maintained as Eurodollar Loans may be incurred prior
to the 90th day after the Initial Borrowing Date (or, if later, the last
day of the Interest Period applicable to the third Borrowing of Eurodollar
Loans referred to below), each of which Borrowings of Eurodollar Loans may
only have an Interest Period of one month, and the first of which
Borrowings may only be made on the same date as the initial Borrowing of
Term Loans that are maintained as Eurodollar Loans, the second of which
Borrowings may only be made on the last day of the Interest Period of the
first such Borrowing and the third of which Borrowings may only be made on
the last day of the Interest Period of the second such Borrowing;
(iii) may be repaid and reborrowed in accordance with the
provisions hereof;
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(iv) shall not exceed for any Bank at any time outstanding that
aggregate principal amount which, when added to the product of (x) such
Bank's Adjusted RL Percentage and (y) the sum of (I) the amount of all
Letter of Credit Outstandings (exclusive of Unpaid Drawings which are
repaid with the proceeds of, and simultan eously with the incurrence of,
the respective incurrence of Revolving Loans) at such time and (II) the
aggregate principal amount of all Swingline Loans (exclusive of Swingline
Loans which are repaid with the proceeds of, and simultaneously with the
incurrence of, the respective incurrence of Revolving Loans) then
outstanding, equals the Revolving Loan Commitment of such Bank at such
time; and
(v) shall not exceed for all Banks at any time outstanding that
aggregate principal amount which, when added to (x) the amount of all
Letter of Credit Outstandings (exclusive of Unpaid Drawings which are
repaid with the proceeds of, and simultaneously with the incurrence of, the
respective incurrence of Revolving Loans) at such time and (y) the
aggregate principal amount of all Swingline Loans (exclusive of Swingline
Loans which are repaid with the proceeds of, and simultan eously with the
incurrence of, the respective incurrence of Revolving Loans) then
outstanding, exceeds an amount equal to the Total Revolving Loan Commitment
then in effect.
(c) Subject to and upon the terms and conditions herein set forth,
BTCo in its individual capacity agrees to make at any time and from time to time
on and after the Initial Borrowing Date and prior to the Swingline Expiry Date,
a loan or loans to the Borrower (each, a "Swingline Loan" and, collectively, the
"Swingline Loans"), which Swingline Loans:
(i) shall be denominated in U.S. Dollars;
(ii) shall be made and maintained as Base Rate Loans;
(iii) may be repaid and reborrowed in accordance with the
provisions hereof;
(iv) shall not exceed in aggregate principal amount at any time
outstand ing, when combined with the aggregate principal amount of (x) all
Revolving Loans made by Non-Defaulting Banks then outstanding and (y) the
Letter of Credit Outstandings at such time, an amount equal to the Adjusted
Total Revolving Loan Commitment at such time (after giving effect to any
changes thereto on such date); and
(v) shall not exceed in aggregate principal amount at any time
outstanding the Maximum Swingline Amount.
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BTCo shall not be obligated to make any Swingline Loans at a time when a Bank
Default exists unless BTCo has entered into arrangements satisfactory to it and
the Borrower to eliminate BTCo's risk with respect to the Defaulting Bank's or
Banks' participation in such Swingline Loans, including by cash collateralizing
such Defaulting Bank's or Banks' RL Percentage of the outstanding Swingline
Loans. BTCo will not make a Swingline Loan after it has received written notice
from the Borrower or the Required Banks stating that a Default or an Event of
Default exists until such time as BTCo shall have received a written notice of
(i) rescission of such notice from the party or parties originally delivering
the same or (ii) a waiver of such Default or Event of Default from the Required
Banks.
(d) On any Business Day, BTCo may, in its sole discretion, give
notice to the XX Xxxxx that its outstanding Swingline Loans shall be funded with
a Borrowing of Revolving Loans (provided that each such notice shall be deemed
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to have been automatic ally given upon the occurrence of a Default or an Event
of Default under Section 10.05 or upon the exercise of any of the remedies
provided in the last paragraph of Section 10), in which case a Borrowing of
Revolving Loans constituting Base Rate Loans (each such Bor rowing, a "Mandatory
Borrowing") shall be made on the immediately succeeding Business Day by all XX
Xxxxx pro rata based on each RL Bank's Adjusted RL Percentage, and the proceeds
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thereof shall be applied directly to repay BTCo for such outstanding Swingline
Loans. Each RL Bank hereby irrevocably agrees to make Base Rate Loans upon one
Business Day's notice pursuant to each Mandatory Borrowing in the amount and in
the manner specified in the preceding sentence and on the date specified in
writing by BTCo notwithstanding (i) that the amount of the Mandatory Borrowing
may not comply with the Minimum Borrowing Amount otherwise required hereunder,
(ii) whether any conditions specified in Section 5 or 6 are then satisfied,
(iii) whether a Default or an Event of Default has occurred and is continuing,
(iv) the date of such Mandatory Borrowing and (v) the amount of the Total
Revolving Loan Commitment or the Adjusted Total Revolving Loan Commitment at
such time. In the event that any Mandatory Borrowing cannot for any reason be
made on the date otherwise required above (including, without limitation, as a
result of the commencement of a proceeding under the Bankruptcy Code in respect
of the Borrower), each RL Bank (other than BTCo) hereby agrees that it shall
forthwith purchase from BTCo (without recourse or warranty) such assignment of
the outstanding Swingline Loans as shall be necessary to cause the XX Xxxxx to
share in such Swingline Loans ratably based upon their respective Adjusted RL
Percentages (determined before giving effect to any termination of the Revolving
Loan Commitments pursuant to the last paragraph of Section 10), provided that
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(x) all interest payable on the Swingline Loans shall be for the account of BTCo
until the date the respective assignment is purchased and, to the extent
attributable to the purchased assignment, shall be payable to the RL Bank
purchasing same from and after such date of purchase and (y) at the time any
purchase of assignments pur suant to this sentence is actually made, the
purchasing RL Bank shall be required to pay BTCo interest on the principal
amount of assignment purchased for each day from and including the day upon
which the Mandatory Borrowing would otherwise have occurred to
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but excluding the date of payment for such assignment, at the rate otherwise
applicable to Revolving Loans maintained as Base Rate Loans hereunder for each
day thereafter.
1.02 Minimum Borrowing Amounts, etc. The aggregate principal amount
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of each Borrowing of Loans shall not be less than the Minimum Borrowing Amount
appli cable to such Loans, provided that Mandatory Borrowings shall be made in
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the amounts required by Section 1.01(d). More than one Borrowing may be
incurred on any day, provided, that at no time shall there be outstanding more
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than seven Borrowings of Eurodollar Loans.
1.03 Notice of Borrowing. (a) Whenever the Borrower desires to make
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a Borrowing hereunder (excluding Borrowings of Swingline Loans and Mandatory
Borrow ings), it shall give the Agent at its Notice Office, prior to 12:00 Noon
(New York time), at least three Business Days' prior written notice (or
telephonic notice promptly confirmed in writing) of each Borrowing of Eurodollar
Loans and at least one Business Day's prior written notice (or telephonic notice
promptly confirmed in writing) of each Borrowing of Base Rate Loans to be made
hereunder. Each such notice (each, a "Notice of Borrowing") shall, except as
otherwise expressly provided in Section 1.10, be irrevocable, and, in the case
of each written notice and each confirmation of telephonic notice, shall be in
the form of Exhibit A, appropriately completed to specify: (i) the aggregate
principal amount of the Loans to be made pursuant to such Borrowing, (ii) the
date of such Borrowing (which shall be a Business Day), (iii) whether the
respective Borrowing shall consist of Term Loans or Revolving Loans, (iv)
whether the respective Borrowing shall consist of Base Rate Loans or, to the
extent permitted hereunder, Eurodollar Loans and, if Eurodollar Loans, the
Interest Period to be initially applicable thereto and (v) in the case of a
Borrowing of Revolving Loans the proceeds of which are to be utilized to
finance, in whole or in part, the purchase price of a Permitted Acquisition, (x)
a reference to the officer's certificate, if any, delivered in accordance with
Section 8.14, (y) the aggregate principal amount of such Revolving Loans to be
utilized in connection with such Permitted Acquisition and (z) the Total
Unutilized Revolving Loan Commitment then in effect after giving effect to the
respective Permitted Acquisition (and all payments to be made in connection
therewith). The Agent shall promptly give each Bank which is required to make
Loans of the Tranche specified in the respective Notice of Borrowing, written
notice (or telephonic notice promptly confirmed in writing) of each proposed
Borrowing, of such Bank's proportionate share thereof and of the other matters
required by the immediately preceding sentence to be specified in the Notice of
Borrowing.
(b) (i) Whenever the Borrower desires to incur Swingline Loans
hereunder, it shall give BTCo not later than 12:00 Noon (New York time) on the
day such Swingline Loan is to be made, written notice (or telephonic notice
promptly confirmed in writing) of each Swingline Loan to be made hereunder.
Each such notice shall be irrevocable and shall specify in each case (x) the
date of such Borrowing (which shall be a Business Day) and
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(y) the aggregate principal amount of the Swingline Loan to be made pursuant to
such Borrowing.
(ii) Mandatory Borrowings shall be made upon the notice specified in
Sec tion 1.01(d), with the Borrower irrevocably agreeing, by its incurrence of
any Swingline Loan, to the making of Mandatory Borrowings as set forth in such
Section 1.01(d).
(c) Without in any way limiting the obligation of the Borrower to
confirm in writing any telephonic notice permitted to be given hereunder, the
Agent or BTCo (in the case of a Borrowing of Swingline Loans) or the Letter of
Credit Issuer (in the case of the issuance of Letters of Credit), as the case
may be, may prior to receipt of written con firmation act without liability upon
the basis of such telephonic notice, believed by the Agent, BTCo or the Letter
of Credit Issuer, as the case may be, in good faith to be from an Authorized
Officer of the Borrower. In each such case, the Agent's, BTCo's or the
respective Letter of Credit Issuer's, as the case may be, record of the terms of
such tele phonic notice shall be conclusive evidence of the contents of such
notice, absent manifest error.
1.04 Disbursement of Funds. (a) Not later than 1:00 P.M. (New York
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time) on the date specified in each Notice of Borrowing (or (x) in the case of
Swingline Loans, not later than 2:00 P.M. (New York time) on the date specified
in Section 1.03(b)(i) or (y) in the case of Mandatory Borrowings, not later than
12:00 Noon (New York time) on the date specified in Section 1.01(d)), each Bank
with a Commitment of the respective Tranche will make available its pro rata
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share (determined in accordance with Section 1.07), if any, of each Borrowing
requested to be made on such date (or in the case of Swingline Loans, BTCo shall
make available the full amount thereof) in the manner pro vided below. All
amounts shall be made available to the Agent in U.S. Dollars and in immediately
available funds at the Payment Office and the Agent promptly will make avail
able to the Borrower by depositing to its account at the Payment Office the
aggregate of the amounts so made available in the type of funds received.
Unless the Agent shall have been notified by any Bank prior to the date of
Borrowing that such Bank does not intend to make available to the Agent its
portion of the Borrowing or Borrowings to be made on such date, the Agent may
assume that such Bank has made such amount available to the Agent on such date
of Borrowing, and the Agent, in reliance upon such assumption, may (in its sole
dis cretion and without any obligation to do so) make available to the Borrower
a correspond ing amount. If such corresponding amount is not in fact made
available to the Agent by such Bank and the Agent has made available same to the
Borrower, the Agent shall be enti tled to recover such corresponding amount on
demand from such Bank. If such Bank does not pay such corresponding amount
forthwith upon the Agent's demand therefor, the Agent shall promptly notify the
Borrower, and the Borrower shall immediately pay such corre sponding amount to
the Agent. The Agent shall also be entitled to recover on demand from such Bank
or the Borrower, as the case may be, interest on such corresponding amount in
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respect of each day from the date such corresponding amount was made available
by the Agent to the Borrower to the date such corresponding amount is recovered
by the Agent, at a rate per annum equal to (x) if paid by such Bank, the
overnight Federal Funds Rate or (y) if paid by the Borrower, the then applicable
rate of interest, calculated in accordance with Section 1.08.
(b) Nothing in this Agreement shall be deemed to relieve any Bank from
its obligation to fulfill its commitments hereunder or to prejudice any rights
which the Borrower may have against any Bank as a result of any default by such
Bank hereunder.
1.05 Notes. (a) The Borrower's obligation to pay the principal of,
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and interest on, all the Loans made to it by each Bank shall be evidenced (i) if
Term Loans, by a promissory note substantially in the form of Exhibit B-1 with
blanks appropriately completed in conformity herewith (each, a "Term Note" and,
collectively, the "Term Notes"), (ii) if Revolving Loans, by a promissory note
substantially in the form of Exhibit B-2 with blanks appropriately completed in
conformity herewith (each, a "Revolving Note" and, collectively, the "Revolving
Notes") and (iii) if Swingline Loans, by a promissory note substantially in the
form of Exhibit B-3 with blanks appropriately completed in conformity herewith
(the "Swingline Note").
(b) The Term Note issued to each Bank with a Term Loan Commitment
shall (i) be executed by the Borrower, (ii) be payable to such Bank or its
registered assigns and be dated the date of issuance thereof, (iii) be in a
stated principal amount equal to the Term Loans made by such Bank and be payable
in the principal amount of Term Loans evi denced thereby, (iv) mature on the
Final Maturity Date, (v) bear interest as provided in the appropriate clause of
Section 1.08 in respect of the Base Rate Loans and Eurodollar Loans, as the case
may be, evidenced thereby, (vi) be subject to voluntary repayment as provided in
Section 4.01 and mandatory repayment as provided in Section 4.02 and (vii) be
entitled to the benefits of this Agreement and the other Credit Documents.
(c) The Revolving Note issued to each RL Bank shall (i) be executed
by the Borrower, (ii) be payable to such RL Bank or its registered assigns and
be dated the date of issuance thereof, (iii) be in a stated principal amount
equal to the Revolving Loan Commitment of such RL Bank and be payable in the
principal amount of the outstanding Revolving Loans evidenced thereby, (iv)
mature on the Revolving Loan Maturity Date, (v) bear interest as provided in the
appropriate clause of Section 1.08 in respect of the Base Rate Loans and
Eurodollar Loans, as the case may be, evidenced thereby, (vi) be subject to
voluntary prepayment as provided in Section 4.01 and mandatory repayment as
provided in Section 4.02 and (vii) be entitled to the benefits of this Agreement
and the other Credit Documents.
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(d) The Swingline Note issued to BTCo shall (i) be executed by the
Borrower, (ii) be payable to BTCo or its registered assigns and be dated the
Initial Borrowing Date, (iii) be in a stated principal amount equal to the
Maximum Swingline Amount and be payable in the principal amount of the
outstanding Swingline Loans evidenced thereby, (iv) mature on the Swingline
Expiry Date, (v) bear interest as provided in Section 1.08 in respect of the
Base Rate Loans evidenced thereby, (vi) be subject to voluntary prepayment as
provided in Section 4.01 and mandatory repayment as provided in Section 4.02 and
(vii) be entitled to the benefits of this Agreement and the other Credit
Documents.
(e) Each Bank will note on its internal records the amount of each
Loan made by it and each payment in respect thereof and will prior to any
transfer of any of its Notes endorse on the reverse side thereof the outstanding
principal amount of Loans evi denced thereby. Failure to make any such notation
or any error in such notation shall not affect the Borrower's obligations in
respect of such Loans.
1.06 Conversions. The Borrower shall have the option to convert on
-----------
any Business Day occurring on or after the Initial Borrowing Date, all or a
portion at least equal to the applicable Minimum Borrowing Amount of the
outstanding principal amount of Loans (other than Swingline Loans which shall at
all times be maintained as Base Rate Loans) made pursuant to one or more
Borrowings of one or more Types of Loans under a single Tranche into a Borrowing
or Borrowings of another Type of Loan under such Tranche; provided, that (i)
--------
except as otherwise provided in Section 1.10(b) or unless the Borrower pays all
breakage costs and other amounts owing to each Bank pursuant to Section 1.11
concurrently with any such conversion, Eurodollar Loans may be converted into
Base Rate Loans only on the last day of an Interest Period applicable to the
Loans being converted, and no partial conversion of a Borrowing of Eurodollar
Loans shall reduce the outstanding principal amount of the Eurodollar Loans made
pursuant to such Borrowing to less than the Minimum Borrowing Amount applicable
thereto, (ii) Base Rate Loans may only be converted into Eurodollar Loans if no
Default or Event of Default is in existence on the date of the conversion, (iii)
unless the Agent has determined that the Syndication Date has occurred (at which
time this clause (iii) shall no longer be applicable), prior to the 90th day
after the Initial Borrowing Date, conversions of Base Rate Loans into Eurodollar
Loans may only be made if any such conversion is effective on the first day of
the first, second or third Interest Period referred to in clause (y) of each of
Sections 1.01(a)(iii) and 1.01(b)(ii) and so long as such conversion does not
result in a greater number of Borrowings of Eurodollar Loans prior to the 90th
day after the Initial Borrowing Date as are permitted under Sections
1.01(a)(iii) and 1.01(b)(ii) and (iv) Borrowings of Eurodollar Loans resulting
from this Section 1.06 shall be limited in number as provided in Section 1.02.
Each such conversion shall be effected by the Borrower by giving the Agent at
its Notice Office, prior to 11:00 A.M. (New York time), at least three Business
Days' (or one Business Day's in the case of a conversion into Base Rate Loans)
prior written notice (or
-8-
telephonic notice promptly confirmed in writing) (each, a "Notice of
Conversion") specify ing the Loans to be so converted, the Borrowing(s) pursuant
to which the Loans were made and, if to be converted into a Borrowing of
Eurodollar Loans, the Interest Period to be initially applicable thereto. The
Agent shall give each Bank prompt notice of any such proposed conversion
affecting any of its Loans. Upon any such conversion, the proceeds thereof will
be deemed to be applied directly on the day of such conversion to prepay the
outstanding principal amount of the Loans being converted.
1.07 Pro Rata Borrowings. All Borrowings of Term Loans and Revolving
-------------------
Loans under this Agreement shall be incurred by the Borrower from the Banks pro
---
rata on the basis of such Banks' Term Loan Commitments or Revolving Loan
----
Commitments, as the case may be; provided that all Borrowings of Revolving Loans
--------
made pursuant to a Mandatory Borrowing shall be incurred from the XX Xxxxx pro
---
rata on the basis on their Adjusted RL Percentages. It is understood that no
----
Bank shall be responsible for any default by any other Bank of its obligation to
make Loans hereunder and that each Bank shall be obligated to make the Loans to
be made by it hereunder, regardless of the failure of any other Bank to fulfill
its commitments hereunder.
1.08 Interest. (a) The unpaid principal amount of each Base Rate
--------
Loan shall bear interest from the date of the Borrowing thereof until the
earlier of (i) the maturity (whether by acceleration or otherwise) of such Base
Rate Loan and (ii) the conversion of such Base Rate Loan to a Eurodollar Loan
pursuant to Section 1.06, at a rate per annum which shall at all times be the
relevant Applicable Margin plus the Base Rate in effect from time to time.
----
(b) The unpaid principal amount of each Eurodollar Loan shall bear
interest from the date of the Borrowing thereof until the earlier of (i) the
maturity (whether by acceleration or otherwise) of such Eurodollar Loan and (ii)
the conversion of such Eurodollar Loan to a Base Rate Loan pursuant to Section
1.06, 1.09 or 1.10(b), as appli cable, at a rate per annum which shall at all
times be the relevant Applicable Margin plus the Eurodollar Rate for such
----
Interest Period.
(c) Overdue principal and, to the extent permitted by law, overdue
interest in respect of each Loan shall bear interest at a rate per annum equal
to the greater of (x) the rate which is 2% in excess of the rate borne by the
respective such Loans immediately prior to the respective payment default and
(y) the rate which is 2% in excess of the rate otherwise applicable to Base Rate
Loans from time to time. Interest which accrues under this Section 1.08(c)
shall be payable on demand.
(d) Interest shall accrue from and including the date of any
Borrowing to but excluding the date of any repayment thereof and shall be
payable (i) in respect of each Base Rate Loan, quarterly in arrears on each
Quarterly Payment Date, (ii) in respect of
-9-
each Eurodollar Loan, on (x) the date of any conversion into a Base Rate Loan
pursuant to Section 1.06, 1.09 or 1.10(b), as applicable (on the amount
converted) and (y) the last day of each Interest Period applicable thereto and,
in the case of an Interest Period in excess of three months, on each date
occurring at three month intervals after the first day of such Interest Period
and (iii) in respect of each Loan, on (x) the date of any prepayment or
repayment thereof (on the amount prepaid or repaid), (y) at maturity (whether by
acceleration or otherwise) and (z) after such maturity, on demand.
(e) All computations of interest hereunder shall be made in
accordance with Section 13.07(b).
(f) Upon each Interest Determination Date, the Agent shall determine
the Eurodollar Rate for the respective Interest Period or Interest Periods and
shall promptly notify the Borrower and the Banks thereof. Each such
determination shall, absent manifest error, be final and conclusive and binding
on all parties hereto.
1.09 Interest Periods. At the time the Borrower gives a Notice of
----------------
Borrow ing or Notice of Conversion in respect of the making of, or conversion
into, a Borrowing of Eurodollar Loans (in the case of the initial Interest
Period applicable thereto) or prior to 11:00 A.M. (New York time) on the third
Business Day prior to the expiration of an Interest Period applicable to a
Borrowing of Eurodollar Loans (in the case of any subse quent Interest Period),
the Borrower shall have the right to elect by giving the Agent written notice
(or telephonic notice promptly confirmed in writing) of the Interest Period
applicable to such Borrowing, which Interest Period shall, at the option of the
Borrower (but otherwise subject to clause (y) of the proviso to Sections
1.01(a)(iii) and 1.01(b)(ii) and to clause (iii) of the proviso to Section
1.06), be a one, two, three or six month period. Notwithstanding anything to
the contrary contained above:
(i) all Eurodollar Loans comprising a Borrowing shall at all times
have the same Interest Period;
(ii) the initial Interest Period for any Borrowing of Eurodollar
Loans shall commence on the date of such Borrowing (including the date of
any conver sion from a Borrowing of Base Rate Loans) and each Interest
Period occurring thereafter in respect of such Borrowing shall commence on
the day on which the next preceding Interest Period applicable thereto
expires;
(iii) if any Interest Period for any Borrowing of Eurodollar Loans
begins on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period, such Interest Period
shall end on the last Business Day of such calendar month;
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(iv) if any Interest Period would otherwise expire on a day which is
not a Business Day, such Interest Period shall expire on the next
succeeding Business Day, provided, that if any Interest Period for any
--------
Borrowing of Eurodollar Loans would otherwise expire on a day which is not
a Business Day but is a day of the month after which no further Business
Day occurs in such month, such Interest Period shall expire on the next
preceding Business Day;
(v) no Interest Period for a Borrowing under a Tranche shall be
selected which would extend beyond the respective Maturity Date for such
Tranche;
(vi) no Interest Period may be elected at any time when a Default or
an Event of Default is then in existence;
(vii) no Interest Period in respect of any Borrowing of Revolving
Loans shall be elected which extends beyond any date upon which a Scheduled
Commitment Reduction will be required to be made under Section 3.03(c) if
the aggregate principal amount of such Revolving Loans which have Interest
Periods which will expire after such date, when added to the Stated Amount
of all Letters of Credit which by their terms expire after such date, will
be in excess of the Total Revolving Loan Commitment as the same will be in
effect after giving effect to the respective Scheduled Commitment
Reduction; and
(viii) no Interest Period in respect of any Borrowing of Term Loans
shall be elected which extends beyond any date upon which a Scheduled
Repayment will be required to be made under Section 4.02(b) if, after
giving effect to the election of such Interest Period, the aggregate
principal amount of such Term Loans which have Interest Periods which will
expire after such date will be in excess of the aggregate principal amount
of such Term Loans then outstanding less the aggregate amount of such
required Scheduled Repayment.
If upon the expiration of any Interest Period applicable to a
Borrowing of Eurodollar Loans, the Borrower has failed to elect, or is not
permitted to elect, a new Interest Period to be applicable to the respective
Borrowing of Eurodollar Loans as provided above, the Borrower shall be deemed to
have elected to convert such Borrowing into a Borrowing of Base Rate Loans
effective as of the expiration date of such current Interest Period.
1.10 Increased Costs; Illegality; etc. (a) In the event that (x) in
---------------------------------
the case of clause (i) below, the Agent or (y) in the case of clauses (ii) and
(iii) below, any Bank, shall have determined (which determination shall, absent
manifest error, be final and con clusive and binding upon all parties hereto):
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(i) on any Interest Determination Date, that, by reason of any
changes arising after the date of this Agreement affecting the interbank
Eurodollar market, adequate and fair means do not exist for ascertaining
the applicable interest rate on the basis provided for in the definition of
Eurodollar Rate; or
(ii) at any time, that such Bank shall incur increased costs or
reductions in the amounts received or receivable hereunder with respect to
any Eurodollar Loans because of (x) any change since the date of this
Agreement in any applicable law, governmental rule, regulation, guideline,
order or request (whether or not hav ing the force of law), or in the
interpretation or administration thereof and including the introduction of
any new law or governmental rule, regulation, guideline, order or request,
such as, for example, but not limited to, (A) a change in the basis of
taxation of payment to any Bank of the principal of or interest on such
Eurodollar Loans or any other amounts payable hereunder (except for changes
with respect to any tax imposed on, or determined by reference to, the net
income, net profits or capital (including branch profits tax) of such Bank
or any franchise tax based on the net income or net profits of such Bank
pursuant to the laws of the jurisdiction in which such Bank is organized,
or in which such Bank's principal office or applicable lending office is
located or any subdivision thereof or therein), or (B) a change in official
reserve requirements, but, in all events, excluding reserves required under
Regulation D to the extent included in the computation of the Eurodollar
Rate and/or (y) other circumstances affecting such Bank, the interbank
Eurodollar market or the position of such Bank in such market; or
(iii) at any time since the date of this Agreement, that the making
or con tinuance of any Eurodollar Loan has become unlawful by compliance by
such Bank with any law, governmental rule, regulation, guideline or order
(or would conflict with any governmental rule, regulation, guideline,
request or order not having the force of law but with which such Bank
customarily complies even though the failure to comply therewith would not
be unlawful), or has become impracticable as a result of a contingency
occurring after the date of this Agreement which materially and adversely
affects the interbank Eurodollar market;
then, and in any such event, such Bank (or the Agent in the case of clause (i)
above) shall promptly give notice (by telephone confirmed in writing) to the
Borrower and (except in the case of clause (i)) to the Agent of such
determination (which notice the Agent shall promptly transmit to each of the
other Banks). Thereafter, (x) in the case of clause (i) above, Eurodollar Loans
shall no longer be available until such time as the Agent notifies the Borrower
and the Banks that the circumstances giving rise to such notice by the Agent no
longer exist, and any Notice of Borrowing or Notice of Conversion given by the
Bor rower with respect to Eurodollar Loans which have not yet been incurred
(including by way of conversion) shall be deemed rescinded by the Borrower, (y)
in the case of clause (ii)
-12-
above, the Borrower agrees, subject to the provisions of Section 13.18 (to the
extent applicable), to pay to such Bank, upon written demand therefor, such
additional amounts (in the form of an increased rate of, or a different method
of calculating, interest or otherwise as such Bank in its sole discretion shall
determine) as shall be required to com pensate such Bank for such increased
costs or reductions in amounts received or receivable hereunder but without
duplication of any payments due under Section 4.04 (a written notice as to the
additional amounts owed to such Bank, showing in reasonable detail the basis for
the calculation thereof, submitted to the Borrower by such Bank shall, absent
manifest error, be final and conclusive and binding upon all parties hereto,
although the failure to give any such notice shall not release or diminish any
of the Borrower's obligations to pay additional amounts pursuant to this Section
1.10(a) upon the subsequent receipt of such notice) and (z) in the case of
clause (iii) above, the Borrower shall take one of the actions specified in
Section 1.10(b) as promptly as possible and, in any event, within the time
period required by law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), the Borrower may (and
in the case of a Eurodollar Loan affected pursuant to Section 1.10(a)(iii), the
Borrower shall) either (i) if the affected Eurodollar Loan is then being made
pursuant to a Borrowing, cancel said Borrowing by giving the Agent telephonic
notice (confirmed promptly in writing) thereof on the same date that the
Borrower was notified by a Bank pursuant to Section 1.10(a)(ii) or (iii)), or
(ii) if the affected Eurodollar Loan is then outstanding, upon at least three
Business Days' notice to the Agent, require the affected Bank to convert each
such Eurodollar Loan into a Base Rate Loan (which conversion, in the case of the
circumstance described in Section 1.10(a)(iii), shall occur no later than the
last day of the Interest Period then applicable to such Eurodollar Loan or such
earlier day as shall be required by applicable law); provided, that if more than
--------
one Bank is affected at any time, then all affected Banks must be treated the
same pursuant to this Section 1.10(b).
(c) If any Bank shall have determined that after the date hereof, the
adop tion or effectiveness of any applicable law, rule or regulation regarding
capital adequacy, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by such Bank or any corporation controlling such Bank with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on such Bank's or such other corporation's
capital or assets as a consequence of such Bank's Commitment or Commitments
hereunder or its obligations hereunder to a level below that which such Bank or
such other corporation could have achieved but for such adoption, effectiveness,
change or compliance (taking into con sideration such Bank's or such other
corporation's policies with respect to capital ade quacy), then from time to
time, upon written demand by such Bank (with a copy to the
-13-
Agent), accompanied by the notice referred to in the last sentence of this
clause (c), the Borrower agrees, subject to the provisions of Section 13.18 (to
the extent applicable), to pay to such Bank such additional amount or amounts as
will compensate such Bank or such other corporation for such reduction in the
rate of return to such Bank or such other corporation. Each Bank, upon
determining in good faith that any additional amounts will be payable pursuant
to this Section 1.10(c), will give prompt written notice thereof to the Borrower
(a copy of which shall be sent by such Bank to the Agent), which notice shall
set forth in reasonable detail the basis of the calculation of such additional
amounts, although the failure to give any such notice shall not release or
diminish the Borrower's obligations to pay additional amounts pursuant to this
Section 1.10(c) upon the subsequent receipt of such notice. A Bank's reasonable
good faith determination of compensation owing under this Section 1.10(c) shall,
absent manifest error, be final and conclusive and binding on all the parties
hereto.
1.11 Compensation. The Borrower agrees, subject to the provisions of
------------
Section 13.18 (to the extent applicable), to compensate each Bank, promptly upon
its writ ten request (which request shall set forth in reasonable detail the
basis for requesting such compensation), for all losses, expenses and
liabilities (including, without limitation, any loss, expense or liability
incurred by reason of the liquidation or reemployment of deposits or other funds
required by such Bank to fund its Eurodollar Loans) which such Bank may sustain:
(i) if for any reason (other than a default by such Bank or the Agent) a
Borrowing of, or conversion from or into, Eurodollar Loans does not occur on a
date specified there for in a Notice of Borrowing or Notice of Conversion given
by the Borrower (whether or not withdrawn by the Borrower or deemed withdrawn
pursuant to Section 1.10(a)); (ii) if any repayment (including any repayment
made pursuant to Section 4.01 or 4.02 or as a result of an acceleration of the
Loans pursuant to Section 10 or as a result of the replacement of a Bank
pursuant to Section 1.13 or 13.12(b)) or conversion of any Euro dollar Loans of
the Borrower occurs on a date which is not the last day of an Interest Period
applicable thereto; (iii) if any prepayment of any Eurodollar Loans is not made
on any date specified in a notice of prepayment given by the Borrower; or (iv)
as a con sequence of (x) any other default by the Borrower to repay its
Eurodollar Loans when required by the terms of this Agreement or (y) an election
made by the Borrower pursuant to Section 1.10(b). Each Bank's calculation of
the amount of compensation owing pursuant to this Section 1.11 shall be made in
good faith. A Bank's basis for requesting compensation pursuant to this Section
1.11 and a Bank's calculation of the amount thereof, shall, absent manifest
error, be final and conclusive and binding on all parties hereto.
1.12 Change of Lending Office. Each Bank agrees that, upon the occur
------------------------
rence of any event giving rise to the operation of Section 1.10(a)(ii) or (iii),
1.10(c), 2.05 or 4.04 with respect to such Bank, it will, if requested by the
Borrower, use reasonable efforts (subject to overall policy considerations of
such Bank) to designate another lending office for any Loans or Letters of
Credit affected by such event; provided, that such desig-
--------
-14-
nation is made on such terms that, in the sole judgment of such Bank, such Bank
and its lending office suffer no economic, legal or regulatory disadvantage,
with the object of avoid ing the consequences of the event giving rise to the
operation of any such Section. Nothing in this Section 1.12 shall affect or
postpone any of the obligations of the Borrower or the right of any Bank
provided in Section 1.10, 2.05 or 4.04.
1.13 Replacement of Banks. (x) If any Bank becomes a Defaulting
--------------------
Bank, (y) upon the occurrence of any event giving rise to the operation of
Section 1.10(a)(ii) or (iii), Section 1.10(c), Section 2.05 or Section 4.04 with
respect to any Bank which results in such Bank charging to the Borrower
increased costs in a material amount in excess of those being generally charged
by the other Banks or (z) in the case of a refusal by a Bank to consent to a
proposed change, waiver, discharge or termination with respect to this Agreement
which has been approved by the Required Banks as provided in Section 13.12(b),
the Borrower shall have the right, in accordance with Section 13.04(b), if no
Default or Event of Default then exists or would exist after giving effect to
such replace ment, to replace such Bank (the "Replaced Bank") with one or more
other Eligible Transferee or Transferees, none of whom shall constitute a
Defaulting Bank at the time of such replacement (collectively, the "Replacement
Bank") and each of whom shall be reason ably acceptable to the Agent or, at the
option of the Borrower, to replace only (a) the Revolving Loan Commitment (and
outstandings pursuant thereto) of the Replaced Bank with an identical Revolving
Loan Commitment provided by the Replacement Bank or (b) in the case of a
replacement as provided in Section 13.12(b) where the consent of the respective
Bank is required with respect to less than all Tranches of its Loans or
Commitments, the Commitments and/or outstanding Loans of such Bank in respect of
each Tranche where the consent of such Bank would otherwise be individually
required, with identical Commitments and/or Loans of the respective Tranche
provided by the Replacement Bank; provided that:
--------
(i) at the time of any replacement pursuant to this Section 1.13,
the Replacement Bank shall enter into one or more Assignment and Assumption
Agreements pursuant to Section 13.04(b) (and with all fees payable pursuant
to said Section 13.04(b) to be paid by the Replacement Bank) pursuant to
which the Replacement Bank shall acquire all of the Commitments and
outstanding Loans (or, in the case of the replacement of only (a) the
Revolving Loan Commitment, the Revolving Loan Commitment and outstanding
Revolving Loans and participations in Letter of Credit Outstandings and/or
(b) Term Loans, the outstanding Term Loans) of, and in each case (except
for the replacement of only the outstanding Term Loans of the respective
Bank) participations in Letters of Credit by, the Replaced Bank and, in
connection therewith, shall pay to (x) the Replaced Bank in respect thereof
an amount equal to the sum of (A) an amount equal to the principal of, and
all accrued interest on, all outstanding Loans (or of the Loans of the
respective Tranche or Tranches being replaced) of the Replaced Bank, (B) an
amount equal to all Unpaid Drawings (unless there are no Unpaid Drawings
with
-15-
respect to the Tranche being replaced) that have been funded by (and not
reimbursed to) such Replaced Bank, together with all then unpaid interest
with respect thereto at such time and (C) an amount equal to all accrued,
but theretofore unpaid, Fees owing to the Replaced Bank (but only with
respect to the relevant Tranche, in the case of the replacement of less
than all Tranches of Loans then held by the respective Replaced Bank)
pursuant to Section 3.01, (y) except in the case of the replacement of only
the outstanding Term Loans of a Replaced Bank, each Letter of Credit Issuer
an amount equal to such Replaced Bank's Adjusted RL Percentage of any
Unpaid Drawing relating to Letters of Credit issued by such Letter of
Credit Issuer (which at such time remains an Unpaid Drawing) to the ex tent
such amount was not theretofore funded by such Replaced Bank and (z) in the
case of any replacement of Revolving Loan Commitments, BTCo an amount equal
to such Replaced Bank's Adjusted RL Percentage of any Mandatory Borrowing
to the extent such amount was not theretofore funded by such Replaced Bank;
and
(ii) all obligations of the Borrower then owing to the Replaced
Bank (other than those (a) specifically described in clause (i) above in
respect of which the assignment purchase price has been, or is concurrently
being, paid, but including all amounts, if any, owing under Section 1.11 or
(b) relating to any Tranche of Loans and/or Commitments of the respective
Replaced Bank which will remain outstanding after giving effect to the
respective replacement) shall be paid in full to such Replaced Bank
concurrently with such replacement.
Upon the execution of the respective Assignment and Assumption Agreements, the
payment of amounts referred to in clauses (i) and (ii) above, recordation of the
assignment on the Register by the Agent pursuant to Section 13.17 and, if so
requested by the Replacement Bank, delivery to the Replacement Bank of the
appropriate Note or Notes executed by the Borrower, (x) the Replacement Bank
shall become a Bank hereunder and, unless the respective Replaced Bank continues
to have outstanding Term Loans or a Revolving Loan Commitment hereunder, the
Replaced Bank shall cease to constitute a Bank hereunder, except with respect to
indemnification provisions under this Agreement (including, without limitation,
Sections 1.10, 1.11, 2.05, 4.04, 13.01 and 13.06), which shall survive as to
such Replaced Bank and (y) except in the case of the replacement of only
outstanding Term Loans, the Adjusted RL Percentages of the Banks shall be
automatically adjusted at such time to give effect to such replacement.
SECTION 2. Letters of Credit.
-----------------
2.01 Letters of Credit. (a) Subject to and upon the terms and
-----------------
conditions herein set forth, the Borrower may request a Letter of Credit Issuer
at any time and from time to time on or after the Initial Borrowing Date and
prior to the tenth Business Day (or
-16-
the 30th day in the case of Trade Letters of Credit) preceding the Revolving
Loan Maturity Date to issue, (x) for the account of the Borrower and for the
benefit of any holder (or any trustee, agent or other similar representative for
any such holders) of L/C Supportable Indebtedness, irrevocable standby letters
of credit in a form customarily used by such Letter of Credit Issuer or in such
other form as has been approved by such Letter of Credit Issuer (each such
standby letter of credit, a "Standby Letter of Credit") in support of such L/C
Supportable Indebtedness and (y) for the account of the Borrower and for the
benefit of sellers of goods to the Borrower or any Subsidiary Guarantor in the
ordinary course of business, irrevocable sight trade letters of credit in a form
customarily used by such Letter of Credit Issuer or in such other form as has
been approved by such Letter of Credit Issuer (each such trade letter of credit,
a "Trade Letter of Credit," and each such Standby Letter of Credit and Trade
Letter of Credit, a "Letter of Credit" and, collectively, the "Letters of
Credit").
(b) Subject to and upon the terms and conditions set forth herein,
each Letter of Credit Issuer hereby agrees that it will, at any time and from
time to time on and after the Initial Borrowing Date and prior to the tenth
Business Day (or the 30th day in the case of Trade Letters of Credit) preceding
the Revolving Loan Maturity Date, following its receipt of the respective Letter
of Credit Request, issue for the account of the Borrower one or more Letters of
Credit, (x) in the case of Trade Letters of Credit, in support of trade
obligations of the Borrower or any Subsidiary Guarantor that arise in the
ordinary course of business or (y) in the case of Standby Letters of Credit, in
support of such L/C Support able Indebtedness as is permitted to remain
outstanding hereunder. Notwithstanding the foregoing, no Letter of Credit
Issuer shall be under any obligation to issue any Letter of Credit if at the
time of such issuance:
(i) any order, judgment or decree of any governmental authority or
arbi trator shall purport by its terms to enjoin or restrain such Letter of
Credit Issuer from issuing such Letter of Credit or any requirement of law
applicable to such Letter of Credit Issuer or any request or directive
(whether or not having the force of law) from any governmental authority
with jurisdiction over such Letter of Credit Issuer shall prohibit, or
request that such Letter of Credit Issuer refrain from, the issuance of
letters of credit generally or such Letter of Credit in particular or shall
impose upon such Letter of Credit Issuer with respect to such Letter of
Credit any restriction or reserve or capital requirement (for which such
Letter of Credit Issuer is not otherwise compensated) not in effect on the
date hereof, or any unreimbursed loss, cost or expense which was not
applicable, in effect or known to such Letter of Credit Issuer as of the
date hereof and which such Letter of Credit Issuer in good xxxxx xxxxx
material to it; or
(ii) such Letter of Credit Issuer shall have received written notice
from the Borrower or the Required Banks prior to the issuance of such
Letter of Credit
-17-
of the type described in clause (vi) of Section 2.01(c) or the last
sentence of Section 2.02(b).
(c) Notwithstanding the foregoing, (i) no Letter of Credit shall be
issued the Stated Amount of which, when added to the Letter of Credit
Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and
prior to the issuance of, the respective Letter of Credit) at such time, would
exceed either (x) $15,000,000 or (y) when added to the aggregate principal
amount of all Revolving Loans made by the Non-Defaulting Banks and then
outstanding and all Swingline Loans then outstanding, the Adjusted Total
Revolving Loan Commitment at such time; (ii) (x) each Standby Letter of Credit
shall have an expiry date occurring not later than one year after such Standby
Letter of Credit's date of issuance, provided, that any such Standby Letter of
--------
Credit may be extendable for successive periods of up to one year, but not
beyond the tenth Business Day preceding the Revolving Loan Maturity Date, on
terms acceptable to the Letter of Credit Issuer and (y) each Trade Letter of
Credit shall have an expiry date occurring not later than 180 days after such
Trade Letter of Credit's date of issuance; (iii) (x) no Standby Letter of Credit
shall have an expiry date occurring later than the tenth Business Day preceding
the Revolving Loan Maturity Date and (y) no Trade Letter of Credit shall have an
expiry date occurring later than 30 days prior to the Revolving Loan Maturity
Date; (iv) each Letter of Credit shall be denominated in U.S. Dollars; (v) the
Stated Amount of each Letter of Credit shall not be less than $100,000 or such
lesser amount as is acceptable to the respective Letter of Credit Issuer; and
(vi) no Letter of Credit Issuer will issue any Letter of Credit after it has
received written notice from the Borrower or the Required Banks stating that a
Default or an Event of Default exists until such time as such Letter of Credit
Issuer shall have received a written notice of (x) rescission of such notice
from the party or parties originally delivering the same or (y) a waiver of such
Default or Event of Default by the Required Banks.
(d) Notwithstanding the foregoing, in the event a Bank Default
exists, no Letter of Credit Issuer shall be required to issue any Letter of
Credit unless the respective Letter of Credit Issuer has entered into
arrangements satisfactory to it and the Borrower to eliminate such Letter of
Credit Issuer's risk with respect to the participation in Letters of Credit of
the Defaulting Bank or Banks, including by cash collateralizing such Defaulting
Bank's or Banks' Adjusted RL Percentage of the Letter of Credit Outstandings, as
the case may be.
2.02 Letter of Credit Requests. (a) Whenever the Borrower desires
-------------------------
that a Letter of Credit be issued, the Borrower shall give the Agent and the
respective Letter of Credit Issuer written notice thereof prior to 12:00 Noon
(New York time) at least five Business Days (or such shorter period as may be
acceptable to the respective Letter of Credit Issuer) prior to the proposed date
of issuance (which shall be a Business Day) which written notice shall be in the
form of Exhibit C (each, a "Letter of Credit Request"). Each
-18-
Letter of Credit Request shall include any other documents as such Letter of
Credit Issuer customarily requires in connection therewith.
(b) The making of each Letter of Credit Request shall be deemed to be
a representation and warranty by the Borrower that such Letter of Credit may be
issued in accordance with, and it will not violate the requirements of, Section
2.01(c). Unless the respective Letter of Credit Issuer has received notice from
the Required Banks before it issues a Letter of Credit that one or more of the
applicable conditions specified in Section 5 or 6, as the case may be, are not
then satisfied, or that the issuance of such Letter of Credit would violate
Section 2.01(c), then such Letter of Credit Issuer may issue the requested
Letter of Credit for the account of the Borrower in accordance with such Letter
of Credit Issuer's usual and customary practice.
2.03 Letter of Credit Participations. (a) Immediately upon the
-------------------------------
issuance by a Letter of Credit Issuer of any Letter of Credit, such Letter of
Credit Issuer shall be deemed to have sold and transferred to each other RL
Bank, and each such RL Bank (each, a "Participant") shall be deemed irrevocably
and unconditionally to have purchased and re ceived from such Letter of Credit
Issuer, without recourse or warranty, an undivided inter est and participation,
to the extent of such Participant's Adjusted RL Percentage, in such Letter of
Credit, each substitute Letter of Credit, each drawing made thereunder and the
obligations of the Borrower under this Agreement with respect thereto (although
Letter of Credit Fees shall be payable directly to the Agent for the account of
the XX Xxxxx as provided in Section 3.01(b) and the Participants shall have no
right to receive any portion of any Facing Fees with respect to such Letters of
Credit) and any security therefor or guaranty pertaining thereto. Upon any
change in the Revolving Loan Commitments or the Adjusted RL Percentages of the
XX Xxxxx pursuant to Section 1.13 or 13.04(b) or as a result of a Bank Default,
it is hereby agreed that, with respect to all outstanding Letters of Credit and
Unpaid Drawings with respect thereto, there shall be an automatic adjustment to
the participations pursuant to this Section 2.03 to reflect the new Adjusted RL
Percentages of the assigning and assignee Bank or of all XX Xxxxx, as the case
may be.
(b) In determining whether to pay under any Letter of Credit, no
Letter of Credit Issuer shall have any obligation relative to the Participants
other than to determine that any documents required to be delivered under such
Letter of Credit have been delivered and that they appear to substantially
comply on their face with the requirements of such Letter of Credit. Any action
taken or omitted to be taken by any Letter of Credit Issuer under or in
connection with any Letter of Credit issued by it if taken or omitted in the
absence of gross negligence or willful misconduct, shall not create for such
Letter of Credit Issuer any resulting liability.
(c) In the event that any Letter of Credit Issuer makes any payment
under any Letter of Credit issued by it and the Borrower shall not have
reimbursed such amount
-19-
in full to the Letter of Credit Issuer pursuant to Section 2.04(a), such Letter
of Credit Issuer shall promptly notify the Agent, and the Agent shall promptly
notify each Participant of such failure, and each such Participant shall
promptly and unconditionally pay to the Agent for the account of such Letter of
Credit Issuer, the amount of such Participant's Adjusted RL Percentage of such
payment in U.S. Dollars and in same day funds. If the Agent so notifies any
Participant required to fund a payment under a Letter of Credit prior to 11:00
A.M. (New York time) on any Business Day, such Participant shall make available
to the Agent at the Payment Office for the account of the respective Letter of
Credit Issuer such Participant's Adjusted RL Percentage of the amount of such
payment on such Business Day in same day funds (and, to the extent such notice
is given after 11:00 A.M. (New York time) on any Business Day, such Participant
shall make such payment on the immediately following Business Day). If and to
the extent such Participant shall not have so made its Adjusted RL Percentage of
the amount of such payment available to the Agent for the account of the
respective Letter of Credit Issuer, such Participant agrees to pay to the Agent
for the account of such Letter of Credit Issuer, forthwith on demand such
amount, together with interest thereon, for each day from such date until the
date such amount is paid to the Agent for the account of the Letter of Credit
Issuer at the overnight Federal Funds Rate. The failure of any Participant to
make available to the Agent for the account of the respective Letter of Credit
Issuer its Adjusted RL Percentage of any payment under any Letter of Credit
issued by it shall not relieve any other Participant of its obligation hereunder
to make available to the Agent for the account of such Letter of Credit Issuer
its applicable Adjusted RL Percentage of any payment under any such Letter of
Credit on the date required, as specified above, but no Participant shall be
responsible for the failure of any other Participant to make available to the
Agent for the account of such Letter of Credit Issuer such other Participant's
Adjusted RL Percentage of any such payment.
(d) Whenever any Letter of Credit Issuer receives a payment of a xxxx
bursement obligation as to which the Agent has received for the account of such
Letter of Credit Issuer any payments from the Participants pursuant to clause
(c) above, such Letter of Credit Issuer shall pay to the Agent and the Agent
shall promptly pay to each Participant which has paid its Adjusted RL Percentage
thereof, in U.S. Dollars and in same day funds, an amount equal to such
Participant's Adjusted RL Percentage of the principal amount thereof and
interest thereon accruing after the purchase of the respective participations.
(e) Each Letter of Credit Issuer shall, promptly after each issuance
of, or amendment or modification to, a Standby Letter of Credit issued by it,
give the Agent, each Participant and the Borrower written notice of the issuance
of, or amendment or modification to, such Standby Letter of Credit, which notice
shall be accompanied by a copy of the Standby Letter of Credit or Standby
Letters of Credit issued by it and each such amendment or modification thereto.
-20-
(f) Each Letter of Credit Issuer (other than BTCo) shall deliver to
the Agent, promptly on the first Business Day of each week, by facsimile
transmission, the aggregate daily Stated Amount available to be drawn under the
outstanding Trade Letters of Credit issued by such Letter of Credit Issuer for
the previous week. The Agent shall,
within 10 days after the last Business Day of each calendar month, deliver to
each Participant a report setting forth for such preceding calendar month the
aggregate daily Stated Amount available to be drawn under all outstanding Trade
Letters of Credit during such calendar month.
(g) The obligations of the Participants to make payments to the Agent
for the account of the respective Letter of Credit Issuer with respect to
Letters of Credit issued by it shall be irrevocable and not subject to
counterclaim, set-off or other defense or any other qualification or exception
whatsoever and shall be made in accordance with the terms and conditions of this
Agreement under all circumstances, including, without limitation, any of the
following circumstances:
(i) any lack of validity or enforceability of this Agreement or any
of the other Credit Documents;
(ii) the existence of any claim, set-off, defense or other right
which the Borrower or any of its Subsidiaries may have at any time against
a beneficiary named in a Letter of Credit, any transferee of any Letter of
Credit (or any Person for whom any such transferee may be acting), the
Agent, any Letter of Credit Issuer, any Bank, or other Person, whether in
connection with this Agreement, any Letter of Credit, the transactions
contemplated herein or any unrelated transactions (including any underlying
transaction between the Borrower or any of its Subsidiaries and the
beneficiary named in any such Letter of Credit);
(iii) any draft, certificate or other document presented under the
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;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents; or
(v) the occurrence of any Default or Event of Default.
2.04 Agreement to Repay Letter of Credit Drawings. (a) The Borrower
--------------------------------------------
hereby agrees to reimburse each Letter of Credit Issuer, by making payment to
the Agent in immediately available funds at the Payment Office, for any payment
or disbursement made by such Letter of Credit Issuer under any Letter of Credit
issued by it (each such amount so paid or disbursed until reimbursed, an "Unpaid
Drawing") immediately after,
-21-
and in any event on the date of such payment or disbursement, with interest on
the amount so paid or disbursed by such Letter of Credit Issuer, to the extent
not reimbursed prior to 1:00 P.M. (New York time) on the date of such payment or
disbursement, from and including the date paid or disbursed to but not including
the date such Letter of Credit Issuer is reimbursed therefor at a rate per annum
which shall be the Applicable Margin for Revolving Loans maintained as Base Rate
Loans as in effect from time to time (plus an additional 2% per annum if not
reimbursed by the third Business Day after the date of such payment or
disbursement), such interest also to be payable on demand; provided, that it is
--------
understood and agreed, however, that the notices referred to above in this
clause (a) shall not be required to be given if a Default or an Event of Default
under such Section 10.05 shall have occurred and be continuing (in which case
the Unpaid Drawings shall be due and payable immediately without presentment,
demand, protest or notice of any kind (all of which are hereby waived by each
Credit Party) and shall bear interest at a rate per annum which shall be
Applicable Margin for Revolving Loans maintained as Base Rate Loans plus 2% on
and after the third Business Day following the respective Drawing). Each Letter
of Credit Issuer shall provide the Borrower prompt notice of any payment or
disbursement made by it under any Letter of Credit issued by it, although the
failure of, or delay in, giving any such notice shall not release or diminish
the obligations of the Borrower under this Section 2.04(a) or under any other
Section of this Agreement.
(b) The Borrower's obligation under this Section 2.04 to reimburse
the respective Letter of Credit Issuer with respect to drawings on Letters of
Credit (including, in each case, interest thereon) shall be absolute and
unconditional under any and all circum stances and irrespective of any setoff,
counterclaim or defense to payment which the Borrower or any of its Subsidiaries
may have or have had against such Letter of Credit Issuer, the Agent or any
Bank, including, without limitation, any defense based upon the failure of any
drawing under a Letter of Credit issued by it to conform to the terms of the
Letter of Credit or any nonapplication or misapplication by the beneficiary of
the proceeds of such drawing; provided, however, that the Borrower shall not be
-------- -------
obligated to reimburse such Letter of Credit Issuer for any wrongful payment
made by such Letter of Credit Issuer under a Letter of Credit issued by it as a
result of acts or omissions constituting willful mis conduct or gross negligence
on the part of such Letter of Credit Issuer as determined by a court of
competent jurisdiction.
2.05 Increased Costs. If after the Effective Date, any Letter of
---------------
Credit Issuer or any Participant determines that the adoption or effectiveness
of any applicable law, rule or regulation, order, guideline or request or any
change therein, or any change in the interpretation or administration thereof by
any governmental authority, central bank or com parable agency charged with the
interpretation or administration thereof, or compliance by any Letter of Credit
Issuer or any Participant with any request or directive (whether or not having
the force of law) by any such authority, central bank or comparable agency shall
either (i) impose, modify or make applicable any reserve, deposit, capital
adequacy or sim-
-22-
ilar requirement against Letters of Credit issued by such Letter of Credit
Issuer or such Participant's participation therein (except as contemplated by
Section 4.04), or (ii) impose on any Letter of Credit Issuer or any Participant
any other conditions directly or indirectly affecting this Agreement, any Letter
of Credit or such Participant's participation therein; and the result of any of
the foregoing is to increase the cost to such Letter of Credit Issuer or such
Participant of issuing, maintaining or participating in any Letter of Credit, or
to reduce the amount of any sum received or receivable by such Letter of Credit
Issuer or such Participant hereunder or reduce the rate of return on its capital
with respect to Letters of Credit, then, upon written demand to the Borrower by
such Letter of Credit Issuer or such Participant (a copy of which notice shall
be sent by such Letter of Credit Issuer or such Participant to the Agent),
accompanied by the certificate described in the last sentence of this Section
2.05, the Borrower agrees, subject to the provisions of Section 13.18 (to the
extent applicable), to pay to such Letter of Credit Issuer or such Participant
such additional amount or amounts as will compensate such Letter of Credit
Issuer or such Participant for such increased cost or reduction. A certificate
submitted to the Borrower by such Letter of Credit Issuer or such Participant,
as the case may be (a copy of which certificate shall be sent by such Letter of
Credit Issuer or such Participant to the Agent), setting forth in reasonable
detail the basis for the determination of such additional amount or amounts
necessary to compensate such Letter of Credit Issuer or such Participant as
aforesaid shall be final and conclusive and binding on the Borrower absent
manifest error, although the failure to deliver any such certificate shall not
release or diminish the Borrower's obliga tions to pay additional amounts
pursuant to this Section 2.05 upon subsequent receipt of such certificate.
SECTION 3. Fees; Commitments.
-----------------
3.01 Fees. (a) The Borrower shall pay to the Agent for
----
distribution to each Non-Defaulting Bank a commitment fee (the "Commitment Fee")
for the period from the Effective Date to but not including the Revolving Loan
Maturity Date (or such earlier date as the Total Revolving Loan Commitment shall
have been terminated), computed at a rate for each day equal to the Applicable
Commitment Fee Percentage on the daily average Unutilized Revolving Loan
Commitment of such Non-Defaulting Bank. Accrued Commitment Fees shall be due
and payable quarterly in arrears on each Quarterly Payment Date and on the
Revolving Loan Maturity Date (or such earlier date upon which the Total
Revolving Loan Commitment is terminated).
(b) The Borrower shall pay to the Agent for pro rata distribution to
--- ----
each Non-Defaulting Bank with a Revolving Loan Commitment (based on their
respective Adj usted RL Percentages), a fee in respect of each Letter of Credit
(the "Letter of Credit Fee") computed at a rate per annum equal to the
Applicable Margin for Revolving Loans maintained as Eurodollar Loans then in
effect on the daily Stated Amount of such Letter
-23-
of Credit. Accrued Letter of Credit Fees shall be due and payable quarterly in
arrears on each Quarterly Payment Date and upon the first day on or after the
termination of the Total Revolving Loan Commitment upon which no Letters of
Credit remain outstanding.
(c) The Borrower shall pay to each Letter of Credit Issuer a fee in
respect of each Letter of Credit issued by such Letter of Credit Issuer (the
"Facing Fee") computed at the rate of 1/4 of 1% per annum on the daily Stated
Amount of such Letter of Credit; provided, that in no event shall the annual
--------
Facing Fee with respect to each Letter of Credit be less than $500; it being
agreed that (x) on the date of issuance of any Letter of Credit and on each
anniversary thereof prior to the termination of such Letter of Credit, if $500
will exceed the amount of Facing Fees that will accrue with respect to such
Letter of Credit for the immediately succeeding 12-month period, the full $500
shall be payable on the date of issuance of such Letter of Credit and on each
such anniversary thereof prior to the termination of such Letter of Credit and
(y) if on the date of the termination of any Letter of Credit, $500 actually
exceeds the amount of Facing Fees paid or payable with respect to such Letter of
Credit for the period beginning on the date of the issuance thereof (or if the
respective Letter of Credit has been outstanding for more than one year, the
date of the last anniversary of the issuance thereof occurring prior to the
termination of such Letter of Credit) and ending on the date of the termination
thereof, an amount equal to such excess shall be paid as additional Facing Fees
with respect to such Letter of Credit on the next date upon which Facing Fees
are payable in accordance with the immediately succeeding sentence. Except as
provided in the immediately preceding sentence, accrued Facing Fees shall be due
and payable quarterly in arrears on each Quarterly Payment Date and upon the
first day on or after the termination of the Total Revolving Loan Commitment
upon which no Letters of Credit remain outstanding.
(d) The Borrower shall pay directly to each Letter of Credit Issuer
upon each issuance of, payment under, and/or amendment of, a Letter of Credit
issued by such Letter of Credit Issuer such amount as shall at the time of such
issuance, payment or amendment be the administrative charge which such Letter of
Credit Issuer is customarily charging for issuances of, payments under or
amendments of, letters of credit issued by it.
(e) The Borrower shall pay to the Agent, for its own account, such
other fees as may be agreed to in writing from time to time between the Borrower
and the Agent, when and as due.
(f) All computations of Fees shall be made in accordance with
Section 13.07(b).
-24-
3.02 Voluntary Termination or Reduction of Total Unutilized Revolving
----------------------------------------------------------------
Loan Commitment. (a) Upon at least three Business Days' prior notice to the
---------------
Agent at its Notice Office (which notice the Agent shall promptly transmit to
each of the Banks), the Borrower shall have the right, without premium or
penalty, to terminate or partially reduce the Total Unutilized Revolving Loan
Commitment, provided that (v) any such termination or partial reduction shall
--------
apply to proportionately and permanently reduce the Revolving Loan Commitment of
each of the XX Xxxxx, (w) any reduction to the Total Unutilized Revolving Loan
Commitment prior to the Initial Borrowing Date may only be made in con nection
with a termination in full of the Total Commitment, (x) any partial reduction
pur suant to this Section 3.02(a) shall be in integral multiples of $1,000,000,
(y) the reduction to the Total Unutilized Revolving Loan Commitment shall in no
case be in an amount which would cause the Revolving Loan Commitment of any RL
Bank to be reduced (as required by the preceding clause (v)) by an amount which
exceeds the remainder of (A) the Unutilized Revolving Loan Commitment of such RL
Bank as in effect immediately before giving effect to such reduction minus (B)
such RL Bank's Adjusted RL Percentage of the aggregate principal amount of
Swingline Loans then outstanding and (z) any partial reduction to the Total
Revolving Loan Commitment pursuant to this Section 3.02(a) shall apply to reduce
the remaining Scheduled Commitment Reductions in direct order of maturity.
(b) In the event of certain refusals by a Bank to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Banks as provided in Section
13.12(b), the Borrower shall have the right, subject to obtaining the consents
required by Section 13.12(b), upon five Business Days' prior written notice to
the Agent at its Notice Office (which notice the Agent shall promptly transmit
to each of the Banks), to terminate the entire Revolving Loan Commitment of such
Bank, so long as all Loans, together with accrued and unpaid interest, Fees and
all other amounts, owing to such Bank (including all amounts, if any, owing
pursuant to Section 1.11 but excluding amounts owing in respect of Term Loans
maintained by such Bank, if such Term Loans are not being repaid pursuant to
Section 13.12(b)) are repaid concurrently with the effectiveness of such
termination (at which time Schedule I shall be deemed modified to reflect such
changed amounts) and at such time, unless the respective Bank continues to have
outstanding Term Loans hereunder, such Bank shall no longer constitute a "Bank"
for purposes of this Agreement, except with respect to indemnifications under
this Agreement (including, without limitation, Sections 1.10, 1.11, 2.05, 4.04,
13.01 and 13.06), which shall survive as to such repaid Bank. Unless otherwise
specifically agreed in writing by the Required Banks, any reduction to the Total
Revolving Loan Commitment pursuant to this Section 3.02(b) shall apply to reduce
the remaining Scheduled Commitment Reductions on a pro rata basis (based upon
--- ----
the then remaining amount of each such Scheduled Commitment Reduction after
giving effect to all prior reductions thereto).
-25-
3.03 Mandatory Reduction of Commitments. (a) The Total Commitment
----------------------------------
(and the Term Loan Commitment and the Revolving Loan Commitment of each Bank)
shall terminate in its entirety on December 31, 1997 unless the Initial
Borrowing Date has occurred on or before such date.
(b) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total Term Loan Commitment (and the Term Loan
Commitment of each Bank) shall (i) terminate in its entirety on the Initial
Borrowing Date (after giving effect to the incurrence of Term Loans on such
date) and (ii) prior to the termination of the Total Term Loan Commitment as
provided in clause (i) above, be reduced from time to time to the extent
required by Section 4.02.
(c) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total Revolving Loan Commitment shall be permanently
reduced on each date set forth below (each, a "Scheduled Commitment Reduction
Date"), by the amount set forth opposite such Scheduled Commitment Reduction
Date (each such reduction, as the same may be reduced as provided in Sections
3.02 and 3.03(f), a "Scheduled Commitment Reduction"):
Scheduled Commitment
Reduction Date Amount
------------------------ ------
December 18, 2001 $37.5 million
December 18, 2002 $37.5 million
(d) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total Revolving Loan Commitment (and the Revolving
Loan Commit ment of each RL Bank) shall terminate in its entirety on the
Revolving Loan Maturity Date.
(e) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total Revolving Loan Commitment shall be reduced from
time to time to the extent required by Section 4.02.
(f) Any amount required to be applied to reduce the Total Revolving
Loan Commitment pursuant to this Section 3.03 (or pursuant to Section 4.02)
shall be applied to reduce the then remaining Scheduled Commitment Reductions
pro rata based upon the then remaining amount of such Scheduled Commitment
--- ----
Reductions after giving effect to all prior reductions thereto.
-26-
(g) Each reduction to the Total Term Loan Commitment or Total
Revolving Loan Commitment pursuant to this Section 3.03 (or pursuant to Section
4.02) shall be applied proportionately to reduce the Term Loan Commitment or the
Revolving Loan Commitment, as the case may be, of each Bank with such a
Commitment.
SECTION 4. Payments.
--------
4.01 Voluntary Prepayments. (a) The Borrower shall have the right
---------------------
to pre pay the Loans, and the right to allocate such prepayments to Revolving
Loans, Swingline Loans and/or Term Loans as the Borrower elects, in whole or in
part, without premium or penalty except as otherwise provided in this Agreement,
from time to time on the following terms and conditions:
(i) the Borrower shall give the Agent at its Notice Office written
notice (or telephonic notice promptly confirmed in writing) of its intent
to prepay the Loans, whether such Loans are Term Loans, Revolving Loans or
Swingline Loans, the amount of such prepayment, the Types of Loans to be
repaid and (in the case of Eurodollar Loans) the specific Borrowing(s)
pursuant to which made, which notice (I) shall be given by the Borrower
prior to 12:00 Noon (New York time) (x) at least one Business Day prior to
the date of such prepayment in the case of Base Rate Loans, (y) on the date
of such prepayment in the case of Swingline Loans and (z) at least three
Business Days prior to the date of such prepayment in the case of
Eurodollar Loans and (II) shall, except in the case of Swingline Loans,
promptly be transmitted by the Agent to each of the Banks;
(ii) each prepayment (other than prepayments in full of (x) all
outstanding Base Rate Loans or (y) any outstanding Borrowing of Eurodollar
Loans) shall be in an aggregate principal amount of at least (x)
$1,000,000, in the case of Eurodollar Loans, (y) $500,000, in the case of
Revolving Loans and Term Loans maintained as Base Rate Loans and (z)
$100,000, in the case of Swingline Loans and, in each case, if greater, in
integral multiples of $100,000, provided, that no partial prepayment of
--------
Eurodollar Loans made pursuant to a Borrowing shall reduce the aggregate
principal amount of the Eurodollar Loans outstanding pursuant to such
Borrowing to an amount less than the Minimum Borrowing Amount applicable
thereto;
(iii) at the time of any prepayment of Eurodollar Loans pursuant to
this Section 4.01 on any date other than the last day of the Interest
Period applicable thereto, the Borrower shall pay the amounts required
pursuant to Section 1.11;
-27-
(iv) each prepayment in respect of any Loans made pursuant to a
Borrowing shall be applied pro rata among such Loans, provided, that at the
--- ---- --------
Borrower's election in connection with any prepayment of Revolving Loans
pursuant to this Section 4.01(a), such prepayment shall not be applied to
any Revolving Loans of a Defaulting Bank; and
(v) each prepayment of principal of Term Loans pursuant to this
Section 4.01(a) shall be applied to reduce the then remaining Scheduled
Repayments in direct order of maturity.
(b) In the event of certain refusals by a Bank to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Banks as provided in Section
13.12(b), the Borrower shall have the right, upon five Business Days' prior
written notice to the Agent at its Notice Office (which notice the Agent shall
promptly transmit to each of the Banks), to repay all Loans of such Bank
(including all amounts, if any, owing pursuant to Section 1.11), together with
accrued and unpaid interest, Fees and all other amounts then owing to such Bank
(or owing to such Bank with respect to each Tranche which gave rise to the need
to obtain such Bank's individual consent) in accordance with said Section
13.12(b), so long as (A) in the case of the repayment of Revolving Loans of any
Bank pursuant to this clause (b), the Revolving Loan Commitment of such Bank is
terminated concurrently with such repayment (at which time Schedule I shall be
deemed modified to reflect the changed Revolving Loan Commitments), and (B) the
consents required by Section 13.12(b) in connection with the repayment pursuant
to this clause (b) shall have been obtained.
4.02 Mandatory Repayments and Commitment Reductions. (a) (i) If on
----------------------------------------------
any date the sum of (x) the aggregate outstanding principal amount of Revolving
Loans made by Non-Defaulting Banks and Swingline Loans (after giving effect to
all other repayments thereof on such date) and (y) the Letter of Credit
Outstandings on such date exceeds the Adjusted Total Revolving Loan Commitment
as then in effect, the Borrower shall repay on such date the principal of
Swingline Loans, and if no Swingline Loans are or remain outstanding, Revolving
Loans of Non-Defaulting Banks in an aggregate amount equal to such excess. If,
after giving effect to the prepayment of all outstanding Swingline Loans and all
outstanding Revolving Loans of Non-Defaulting Banks, the aggregate amount of
Letter of Credit Outstandings exceeds the Adjusted Total Revolving Loan
Commitment as then in effect, the Borrower shall pay to the Agent at the Payment
Office on such date an amount in cash and/or Cash Equivalents equal to such
excess (up to the aggregate amount of Letter of Credit Outstandings at such
time) and the Agent shall hold such pay ment as security for the obligations of
the Borrower to Non-Defaulting Banks hereunder pursuant to a cash collateral
agreement to be entered into in form and substance reasonably satisfactory to
the Agent.
-28-
(ii) On any date on which the aggregate outstanding principal amount
of the Revolving Loans made by any Defaulting Bank exceeds the Revolving Loan
Commitment of such Defaulting Bank, the Borrower shall prepay on such date
principal of Revolving Loans of such Defaulting Bank in an amount equal to such
excess.
(b) In addition to any other mandatory repayments or commitment reduc
tions pursuant to this Section 4.02, on each date set forth below, the Borrower
shall be required to repay that principal amount of Term Loans, to the extent
then outstanding, as is set forth opposite such date (each such repayment, as
the same may be reduced as provided in Sections 4.01 and 4.02(h), a "Scheduled
Repayment"):
Scheduled Repayment Date Amount
------------------------ ------
March 31, 1998 $ 125,000
June 30, 1998 $ 125,000
September 30, 1998 $ 125,000
December 31, 1998 $ 125,000
March 31, 1999 $ 125,000
June 30, 1999 $ 125,000
September 30, 1999 $ 125,000
December 31, 1999 $ 125,000
March 31, 2000 $ 125,000
June 30, 2000 $ 125,000
September 30, 2000 $ 125,000
December 31, 2000 $ 125,000
March 31, 2001 $ 125,000
June 30, 2001 $ 125,000
September 30, 2001 $ 125,000
December 31, 2001 $ 125,000
March 31, 2002 $ 125,000
June 30, 2002 $ 125,000
September 30, 2002 $ 125,000
December 31, 2002 $ 125,000
March 31, 2003 $ 125,000
June 30, 2003 $ 125,000
Final Maturity Date $47,250,000
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(c) In addition to any other mandatory repayments or commitment reduc
tions pursuant to this Section 4.02, on each date on or after the Effective Date
upon which the Borrower or any of its Subsidiaries receives Net Sale Proceeds
from any Asset Sale, an amount equal to the Applicable Prepayment Percentage of
the Net Sale Proceeds from such Asset Sale shall be applied as a mandatory
repayment and/or commitment reduction in accordance with the requirements of
Sections 4.02(h) and (i); provided that (I)(x) with respect to any such Net Sale
--------
Proceeds received by the Borrower or any of its Subsidiaries in connection with
a Healthcare Unit Replacement, such Net Sale Proceeds shall not give rise to a
mandatory repayment (and/or commitment reduction, as the case may be) on such
date to the extent that no Default or Event of Default then exists and the
Borrower delivers a certificate to the Agent on or prior to such date stating
that (i) an amount equal to such Net Sale Proceeds has been used to purchase a
replacement Healthcare Unit within 180 days prior to the date of receipt of such
Net Sale Proceeds or (ii) such Net Sale Proceeds shall be used to purchase a
replacement Healthcare Unit within 180 days following the date of receipt of
such Net Sale Proceeds (which certificate shall set forth the amount of the
proceeds so expended or the estimates of the proceeds to be so expended, as the
case may be) and (y) in the case of any Healthcare Unit Replacement for which no
replacement Healthcare Unit has been purchased prior to the disposition of the
Healthcare Unit to be replaced pursuant to such Healthcare Unit Replacement, if
all or any portion of such Net Sale Proceeds referred to in preceding clause (x)
(ii) are not so used within such 180-day period, such remaining portion shall be
applied on the last day of such period as a mandatory repayment and/or
commitment reduction as provided above and (II)(x) with respect to no more than
$2,500,000 in the aggregate of such Net Sale Proceeds received by the Borrower
or its Subsidiaries in any fiscal year of the Borrower, such Net Sale Proceeds
shall not give rise to a mandatory repayment (and/or commitment reduction, as
the case may be) on such date to the extent that no Default or Event of Default
then exists and the Borrower delivers a certificate to the Agent on or prior to
such date stating that such Net Sale Proceeds shall be used or contractually
committed to be used to purchase assets used or to be used in the businesses
permitted pursuant to Section 9.01 (including, without limitation (but only to
the extent permitted by Section 9.02), the purchase of the capital stock of a
Person engaged in such businesses) within 270 days following the date of receipt
of such Net Sale Proceeds from such Asset Sale (which certificate shall set
forth the estimates of the proceeds to be so expended) and (y)(i) if all or any
portion of such Net Sale Proceeds are not so used (or contractually committed to
be used) within such 270-day period, such remaining portion shall be applied on
the last day of such period as a mandatory repayment and/or commitment reduction
as provided above and (ii) if all or any portion of such Net Sale Proceeds are
not so used within such 270-day period referred to in clause (i) of this clause
(II)(y) because such amount is contractually committed to be used and subsequent
to such date such contract is terminated or expires without such portion being
so used, such remaining portion shall be applied on the date of such termination
or expiration as a mandatory repayment and/or commitment reduction as provided
above.
-30-
(d) In addition to any other mandatory repayments or commitment reduc
tions pursuant to this Section 4.02, on each date on or after the Effective Date
on which the Borrower or any of its Subsidiaries receives any cash proceeds from
any incurrence of Indebtedness (other than Indebtedness permitted to be incurred
pursuant to Section 9.04 as in effect on the Effective Date) or issuance of
Preferred Stock (other than (x) Disqualified Preferred Stock to the extent the
proceeds therefrom are used to effect Permitted Acquisitions, (y) Qualified
Preferred Stock and (z) PIK Preferred Stock issued on the Initial Borrowing Date
in accordance with the requirements of Section 5.08) by the Borrower or any of
its Subsidiaries, an amount equal to the Applicable Prepayment Percentage of the
Net Cash Proceeds of the respective incurrence of Indebtedness shall be applied
as a mandatory repayment and/or commitment reduction in accordance with the
requirements of Sections 4.02(h) and (i).
(e) In addition to any other mandatory repayments or commitment reduc
tions pursuant to this Section 4.02, on each date on or after the Effective Date
on which the Borrower or any of its Subsidiaries receives any cash proceeds from
any sale or issuance of Qualified Preferred Stock or common equity of (or cash
capital contributions to) the Borrower or any of its Subsidiaries (other than
proceeds received from (v) the Common Equity Issuance, (w) issuances of Borrower
Common Stock to management of the Borrower and its Subsidiaries (including as a
result of the exercise of any options with respect thereto) in an aggregate
amount not to exceed $2,500,000 in any fiscal year of the Borrower, (x) equity
contributions to any Subsidiary of the Borrower made by the Borrower or any
other Subsidiary of the Borrower, (y) any issuance of Qualified Preferred Stock
or Borrower Common Stock to the extent the proceeds therefrom are used to effect
Permitted Acquisitions and (z) additional issuances of Borrower Common Stock and
Qualified Preferred Stock, to the extent that the aggregate proceeds excluded
pursuant to this clause (z) after the Effective Date do not exceed $2,500,000),
an amount equal to the Applicable Prepayment Percentage of the Net Cash Proceeds
of the respective equity issuance or capital contribution shall be applied as a
mandatory repayment and/or commitment reduction in accordance with the
requirements of Sections 4.02(h) and (i); provided that Net Cash Proceeds
--------
received by the Borrower from additional sales or issuances of Borrower Common
Stock or Qualified Preferred Stock shall not be required to be applied as a
mandatory repayment (and/or commitment reduction, as the case may be) on the
date of receipt thereof, to the extent that (x) no Default or Event of Default
then exists and (y) the Borrower delivers a certificate to the Agent on or prior
to such date stating that such Net Cash Proceeds shall be used or contractually
committed to be used to make Capital Expenditures (including, without
limitation, Permitted Acquisitions) within 270 days following the date of
receipt of such Net Cash Proceeds (which certificate shall set forth the
estimates of the proceeds to be so expended), and provided further, that (i) if
----------------
all or any portion of such Net Cash Proceeds are not so used (or contractually
committed to be used) within such 270-day period, such remaining portion shall
be applied on the last day of such period as a mandatory repayment and/or
commitment reduction as provided above and (ii)
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if all or any portion of such Net Cash Proceeds are not so used within such 270-
day period referred to in clause (i) above because such amount is contractually
committed to be used and subsequent to such date such contract is terminated or
expires without such portion being so used, such remaining portion shall be
applied on the date of such termination or expiration as a mandatory repayment
and/or commitment reduction as provided above.
(f) In addition to any other mandatory repayments or commitment reduc
tions pursuant to this Section 4.02, within 10 days following each date on or
after the Effective Date on which the Borrower or any of its Subsidiaries
receives any proceeds from any Recovery Event (other than proceeds from Recovery
Events in an amount less than $1,000,000 per Recovery Event), an amount equal to
100% of the proceeds of such Recovery Event (net of reasonable costs (including,
without limitation, legal costs and ex penses) and taxes incurred in connection
with such Recovery Event and the amount of such proceeds required to be used to
repay any Indebtedness (other than Indebtedness of the Banks pursuant to this
Agreement) which is secured by the respective assets subject to such Recovery
Event) shall be applied as a mandatory repayment and/or commitment reduction in
accordance with the requirements of Sections 4.02(h) and (i); provided that (x)
--------
so long as no Default or Event of Default then exists and such proceeds do not
exceed $2,500,000, such proceeds shall not be required to be so applied on such
date to the extent that an Authorized Officer of the Borrower has delivered a
certificate to the Agent on or prior to such date stating that such proceeds
shall be used or shall be committed to be used to replace or restore any
properties or assets in respect of which such proceeds were paid within 360 days
following the date of such Recovery Event (which certificate shall set forth the
estimates of the proceeds to be so expended) and (y) so long as no Default or
Event of Default then exists and to the extent that (a) the amount of such
proceeds exceeds $2,500,000, (b) the amount of such proceeds, together with
other cash available to the Borrower and its Subsidiaries and permitted to be
spent by them on Capital Expenditures during the relevant period, equals at
least 100% of the cost of replacement or restoration of the properties or assets
in respect of which such proceeds were paid as determined by the Borrower and as
supported by such estimates or bids from contractors or subcontractors or such
other supporting information as the Agent may reasonably accept, (c) an
Authorized Officer of the Borrower has delivered to the Agent a certificate on
or prior to the date the application would otherwise be required pursuant to
this Section 4.02(f) in the form des cribed in clause (x) above and also
certifying its determination as required by preceding clause (b) and certifying
the sufficiency of business interruption insurance as required by succeeding
clause (d), and (d) an Authorized Officer of the Borrower has delivered to the
Agent such evidence as the Agent may reasonably request in form and substance
reasonably satisfactory to the Agent establishing that the Borrower has
sufficient business interruption insurance and that the Borrower will receive
payment thereunder in such amounts and at such times as are necessary to satisfy
all obligations and expenses of the Borrower (including, without limitation, all
debt service requirements, including pursuant to this Agreement), without any
delay or extension thereof, for the period from the date of the
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respective casualty, condemnation or other event giving rise to the Recovery
Event and continuing through the completion of the replacement or restoration of
respective properties or assets, then the entire amount of the proceeds of such
Recovery Event and not just the portion in excess of $2,500,000 shall be
deposited with the Agent pursuant to a cash collateral arrangement reasonably
satisfactory to the Agent whereby such proceeds shall be disbursed to the
Borrower from time to time as needed to pay or reimburse the Borrower or such
Subsidiary actual costs incurred by it in connection with the replacement or
restoration of the respective properties or assets (pursuant to such
certification requirements as may be established by the Agent), provided further
----------------
that at any time while an Event of Default has occurred and is continuing, the
Required Banks may direct the Agent (in which case the Agent shall, and is
hereby authorized by the Borrower to, follow said directions) to apply any or
all proceeds then on deposit in such collateral account to the repayment of
Obligations hereunder in the same manner as proceeds would be applied pursuant
to the Security Agreement, and provided further, that if all or any portion of
----------------
such proceeds not required to be applied as a mandatory repayment and/or
commitment reduction pursuant to the second preceding proviso (whether pursuant
to clause (x) or (y) thereof) are either (A) not so used or committed to be so
used within 360 days after the date of the respective Recovery Event or (B) if
committed to be used within 360 days after the date of receipt of such net
proceeds and not so used within 18 months after the date of respective Recovery
Event then, in either such case, such remaining portion not used or committed to
be used in the case of preceding clause (A) and not used in the case of
preceding clause (B) shall be applied on the date occurring 360 days after the
date of the respective Recovery Event in the case of clause (A) above or the
date occurring 18 months after the date of the respec tive Recovery Event in the
case of clause (B) above as a mandatory repayment and/or commitment reduction in
accordance with the requirements of Sections 4.02(h) and (i).
(g) In addition to any other mandatory repayments or commitment reduc
tions pursuant to this Section 4.02, on each Excess Cash Flow Payment Date, an
amount equal to the Applicable Excess Cash Flow Percentage of the Adjusted
Excess Cash Flow for the relevant Excess Cash Flow Payment Period shall be
applied as a mandatory repayment and/or commitment reduction in accordance with
the requirements of Sections 4.02(h) and (i).
(h) Each amount required to be applied pursuant to Sections 4.02(c),
(d), (e), (f) and (g) in accordance with this Section 4.02(h) shall be applied
(i) first, to repay the outstanding principal amount of Term Loans and (ii)
second, to the extent in excess of the amounts required to be applied pursuant
to preceding clause (i), to reduce the Total Revolving Loan Commitment (it being
understood and agreed that (x) the amount of any reduction to the Total
Revolving Loan Commitment shall be deemed to be an application of proceeds for
purposes of this Section 4.02(h) even though cash is not actually applied and
(y) any cash received by the Borrower or such Subsidiary will be retained by
such Person except to the extent that such cash is otherwise required to be
applied as provided
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in Section 4.02(a) as a result of any reduction to the Total Revolving Loan
Commitment). All repayments or commitment reductions, as the case may be, of
(x) outstanding Term Loans on the one hand and (y) Revolving Loan Commitments,
on the other hand, pursuant to Sections 4.02(c), (d), (e), (f) or (g) shall be
applied to reduce the then remaining Scheduled Repayments (in the case of
preceding clause (x)) or Scheduled Commitment Reductions (in the case of
preceding clause (y)), on a pro rata basis (based upon the then remaining
--- ----
Scheduled Repayments or Scheduled Commitment Reductions, as the case may be,
after giving effect to all prior reductions thereto).
(i) With respect to each repayment of Loans required by this Section
4.02, the Borrower may designate the Types of Loans of the respective Tranche
which are to be repaid and, in the case of Eurodollar Loans, the specific
Borrowing or Borrowings of the respective Tranche pursuant to which made,
provided that: (i) repayments of Eurodollar Loans pursuant to this Section 4.02
--------
may only be made on the last day of an Interest Period applicable thereto unless
(x) all Eurodollar Loans of the respective Tranche with Interest Periods ending
on such date of required repayment and all Base Rate Loans of the respective
Tranche have been paid in full and/or (y) concurrently with such repayment, the
Borrower pays all breakage costs and other amounts owing to each Bank pursuant
to Section 1.11; (ii) if any repayment of Eurodollar Loans made pursuant to a
single Borrow ing shall reduce the outstanding Eurodollar Loans made pursuant to
such Borrowing to an amount less than the Minimum Borrowing Amount applicable
thereto, such Borrowing shall be converted at the end of the then current
Interest Period into a Borrowing of Base Rate Loans; and (iii) each repayment of
any Tranche of Loans made pursuant to a Borrowing shall be applied pro rata
--- ----
among such Tranche of Loans. In the absence of a designation by the Borrower as
described in the preceding sentence, the Agent shall, subject to the above, make
such designation in its sole discretion with a view, but no obligation, to
minimize breakage costs owing under Section 1.11. Notwithstanding the foregoing
provisions of this Section 4.02, if at any time the mandatory repayment of Loans
pursuant to Section 4.02(c), (d), (e), (f) or (g) would result, after giving
effect to the procedures set forth in this clause (i) above, in the Borrower
incurring breakage costs under Section 1.10 as a result of Eurodollar Loans
being repaid other than on the last day of an Interest Period applicable thereto
(any such Eurodollar Loans, "Affected Loans"), the Borrower may elect, by
written notice to the Agent, to have the provisions of the following sentence be
applicable. At the time any Affected Loans are otherwise required to be prepaid
the Borrower may elect to deposit 100% (or such lesser percentage elected by the
Borrower as not being repaid) of the principal amounts that otherwise would have
been paid in respect of the Affected Loans with the Agent to be held as security
for the obligations of the Borrower hereunder pursuant to a cash collateral
agreement to be entered into in form and substance satisfactory to the Agent,
with such cash collateral to be released from such cash collateral account (and
applied to repay the principal amount of such Eurodollar Loans) upon each
occurrence thereafter of the last day of an Interest Period applicable to
Eurodollar Loans of the respective Facility (or such earlier date or dates as
shall be
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requested by the Borrower), with the amount to be so released and applied on the
last day of each Interest Period to be the amount of such Eurodollar Loans to
which such Interest Period applies (or, if less, the amount remaining in such
cash collateral account).
(j) Notwithstanding anything to the contrary contained elsewhere in
this Agreement, (i) all then outstanding Swingline Loans shall be repaid in full
on the Swingline Expiry Date and (ii) all other then outstanding Loans shall be
repaid in full on the respective Maturity Date for such Loans.
4.03 Method and Place of Payment. Except as otherwise specifically
---------------------------
pro vided herein, all payments under this Agreement or any Note shall be made to
the Agent for the ratable account of the Bank or Banks entitled thereto not
later than 12:00 Noon (New York time) on the date when due and shall be made in
immediately available funds and in U.S. Dollars at the Payment Office. Any
payments under this Agreement or under any Note which are made later than 12:00
Noon (New York time) shall be deemed to have been made on the next succeeding
Business Day. Whenever any payment to be made here under or under any Note
shall be stated to be due on a day which is not a Business Day, the due date
thereof shall be extended to the next succeeding Business Day and, with respect
to payments of principal, interest shall be payable during such extension at the
applicable rate in effect immediately prior to such extension.
4.04 Net Payments. (a) All payments made by the Borrower hereunder
------------
or under any Note will be made without setoff, counterclaim or other defense.
Except as provided in Section 4.04(b), all such payments will be made free and
clear of, and without deduction or withholding for, any present or future taxes,
levies, imposts, duties, fees, assessments or other charges of whatever nature
now or hereafter imposed by any jurisdic tion or by any political subdivision or
taxing authority thereof or therein with respect to such payments (but
excluding, except as provided in the second succeeding sentence, any tax imposed
on or measured by the net income, net profits or capital (including branch
profits tax) of a Bank pursuant to the laws of the jurisdiction in which it is
organized or the jurisdiction in which the principal office or applicable
lending office of such Bank is located or any subdivision thereof or therein)
and all interest, penalties or similar liabilities with respect to such
nonexcluded taxes, levies, imposts, duties, fees, assessments or other charges
(all such nonexcluded taxes, levies, imposts, duties, fees, assessments or other
charges being referred to collectively as "Taxes"). If any Taxes are so levied
or imposed, the Borrower agrees to pay the full amount of such Taxes, and such
additional amounts as may be necessary so that every payment of all amounts due
under this Agreement or under any Note, after withholding or deduction for or on
account of any Taxes, will not be less than the amount provided for herein or in
such Note. If any amounts are payable in respect of Taxes pursuant to the
preceding sentence, the Borrower agrees to reimburse each Bank, upon the written
request of such Bank, for taxes imposed on or measured by the net income, net
profits or capital (including branch profits tax) of such Bank pursuant to the
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laws of the jurisdiction in which such Bank is organized or in which the
principal office or applicable lending office of such Bank is located or under
the laws of any political subdivision or taxing authority of any such
jurisdiction in which such Bank is organized or in which the principal office or
applicable lending office of such Bank is located and for any withholding of
taxes as such Bank shall determine are payable by, or withheld from, such Bank
in respect of such amounts so paid to or on behalf of such Bank pursuant to the
preceding sentence and in respect of any amounts paid to or on behalf of such
Bank pursuant to this sentence. The Borrower will furnish to the Agent within
45 days after the date the payment of any Taxes is due pursuant to applicable
law certified copies of tax receipts evidencing such payment by the Borrower.
The Borrower agrees to indemnify and hold harmless each Bank, and reimburse such
Bank upon its written request, for the amount of any Taxes so levied or imposed
and paid by such Bank.
(b) Each Bank party to this Agreement on the Effective Date hereby
represents that, as of the Effective Date, all payments of principal, interest,
and fees to be made to it by the Borrower pursuant to this Agreement will be
totally exempt from withholding of United States federal tax. Each Bank that is
not a United States person (as such term is defined in Section 7701(a)(30) of
the Code) for U.S. Federal income tax purposes agrees to deliver to the Borrower
and the Agent on or prior to the Effective Date, or in the case of a Bank that
is an assignee or transferee of an interest under this Agreement pursuant to
Section 1.13 or 13.04 (unless the respective Bank was already a Bank hereunder
immediately prior to such assignment or transfer), on the date of such
assignment or transfer to such Bank, (i) two accurate and complete original
signed copies of Internal Revenue Service Form 4224 or 1001 (or successor forms)
certifying to such Bank's entitlement to a complete exemption from United States
withholding tax with respect to payments to be made under this Agreement and
under any Note, or (ii) if the Bank is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue
Service Form 1001 or 4224 pursuant to clause (i) above, (x) a certificate
substantially in the form of Exhibit D (any such certificate, a "Section
4.04(b)(ii) Certificate") and (y) two accurate and complete original signed
copies of Internal Revenue Service Form W-8 (or successor form) certifying to
such Bank's entitlement to a complete exemption from United States withholding
tax with respect to payments of interest to be made under this Agreement and
under any Note. In addition, each Bank agrees that from time to time after the
Effective Date, when a lapse in time or change in circumstances renders the
previous certification obsolete or inaccurate in any material respect, and that
upon the Borrower's reasonable request after the occurrence of any other event
requiring the delivery of a Form 1001 and Form 4224 in addition to or in
replacement of the forms previously delivered, it will deliver to the Borrower
and the Agent two new accurate and complete original signed copies of Internal
Revenue Service Form 4224 or 1001, or Form W-8 and a Section 4.04(b)(ii)
Certificate, as the case may be, and such other forms as may be required in
order to confirm or establish the entitlement of such Bank to a continued
exemption from or reduction in United States withholding tax with respect to
payments
-36-
under this Agreement and any Note, or it shall immediately notify the Borrower
and the Agent of its inability to deliver any such Form or Certificate in which
case such Bank shall not be required to deliver any such Form or Certificate
pursuant to this Section 4.04(b). Notwithstanding anything to the contrary
contained in Section 4.04(a), but subject to Section 13.04(b) and the
immediately succeeding sentence, (x) the Borrower shall be entitled, to the
extent it is required to do so by law, to deduct or withhold income or similar
taxes imposed by the United States (or any political subdivision or taxing
authority thereof or therein) from interest, fees or other amounts payable
hereunder for the account of any Bank which is not a United States person (as
such term is defined in Section 7701(a)(30) of the Code) for U.S. Federal income
tax purposes to the extent that such Bank has not provided to the Borrower U.S.
Internal Revenue Service Forms that establish a complete exemption from such
deduction or withholding and (y) the Borrower shall not be obligated pursuant to
Section 4.04(a) hereof to gross-up payments to be made to a Bank in respect of
income or similar taxes imposed by the United States if (I) such Bank has not
provided to the Borrower the Internal Revenue Service Forms required to be
provided to the Borrower pursuant to this Section 4.04(b) or (II) in the case of
a payment, other than interest, to a Bank described in clause (ii) above, to the
extent that such Forms do not establish a complete exemption from withholding of
such taxes. Notwithstanding anything to the contrary contained in the preceding
sentence or elsewhere in this Section 4.04 and except as set forth in Section
13.04(b), the Borrower agrees to pay additional amounts and to indemnify each
Bank in the manner set forth in Section 4.04(a) (without regard to the identity
of the jurisdiction requiring the deduction or withholding) in respect of any
Taxes deducted or withheld by them as described in the immediately preceding
sentence as a result of any changes after the Effective Date in any applicable
law, treaty, governmental rule, regulation, guideline or order, or in the
interpretation thereof, relating to the deducting or withholding of such Taxes
(or, if later, the date such Bank became party to this Agreement). The Borrower
shall not be required to pay any additional amounts or indemnification under
Section 4.04(a) to any Bank to the extent that the obligation to pay such
additional amounts or indemnification would not have arisen but for the
representation set forth in the first sentence of Section 4.04(b) above made by
the Bank not being true.
(c) If the Borrower pays any additional amount under this Section
4.04 to a Bank and such Bank determines in its sole discretion that it has
actually received or realized in connection therewith any refund or any
reduction of, or credit against, its Tax liabilities in or with respect to the
taxable year in which the additional amount is paid, such Bank shall pay to the
Borrower an amount that the Bank shall, in its sole discretion, determine is
equal to the net benefit, after tax, which was obtained by the Bank in such year
as a consequence of such refund, reduction or credit.
(d) Each Bank shall use reasonable efforts (consistent with legal and
regulatory restrictions and subject to overall policy considerations of such
Bank) (i) to file any certificate or document or to furnish any information as
reasonably requested by the
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Borrower pursuant to any applicable treaty, law or regulation or (ii) to
designate a different applicable lending office of such Bank, if the making of
such filing or the furnishing of such information or the designation of such
other lending office would avoid the need for or reduce the amount of any
additional amounts payable by the Borrower and would not, in the sole discretion
of such Bank, be disadvantageous to such Bank.
(e) The provisions of this Section 4.04 are subject to the provisions
of Section 13.18 (to the extent applicable).
SECTION 5. Conditions Precedent to Initial Credit Events. The
---------------------------------------------
obligation of each Bank to make each Loan hereunder, and the obligation of the
Letter of Credit Issuer to issue each Letter of Credit hereunder, is subject, at
the time of the making of such Loans or the issuance of such Letters of Credit
to the satisfaction of the following conditions:
5.01 Execution of Agreement; Notes. On or prior to the Initial
-----------------------------
Borrowing Date, (i) the Effective Date shall have occurred and (ii) there shall
have been delivered to the Agent for the account of each Bank the appropriate
Term Note and/or Revolving Note and to BTCo the Swingline Note, in each case
executed by the Borrower and in the amount, maturity and as otherwise provided
herein.
5.02 Officer's Certificate. On the Initial Borrowing Date, the Agent
---------------------
shall have received a certificate dated such date signed by an appropriate
officer of the Borrower stating that all of the applicable conditions set forth
in Sections 5.05 through 5.10, inclusive, and 6.01 (other than such conditions
that are subject to the satisfaction of the Agent and/or the Required Banks),
have been satisfied on such date.
5.03 Opinions of Counsel. On the Initial Borrowing Date, the Agent
-------------------
shall have received opinions, addressed to the Agent, the Collateral Agent and
each of the Banks and dated the Initial Borrowing Date, from (i) X'Xxxxxxxx
Graev & Karabell, LLP, special counsel to the Credit Parties, which opinion
shall cover the matters contained in Exhibit E-1 and such other matters incident
to the transactions contemplated herein as the Agent and the Required Banks may
reasonably request and be in form and substance reasonably satisfactory to the
Agent and the Required Banks, (ii) Irell & Xxxxxxx LLP, special California
counsel to the Borrower, which opinion shall cover the matters contained in
Exhibit E-2 and such other matters incident to the transactions contemplated
herein as the Agent and the Required Banks may reasonably request and be in form
and substance reasonably satisfactory to the Agent and the Required Banks, (iii)
counsel rendering such opinions, reliance letters addressed to the Agent and
each of the Banks and dated the Initial Borrowing Date with respect to all legal
opinions delivered in connection with the Transaction, which opinions shall
cover such matters as the Agent may reasonably request and be in form and
substance reasonably satisfactory to the Agent and (iv) local counsel to
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the Credit Parties and/or the Agent reasonably satisfactory to the Agent, which
opinions (x) shall be addressed to the Agent, the Collateral Agent and each of
the Banks and be dated the Initial Borrowing Date, (y) shall cover the
perfection of the security interests granted pursuant to the Security Documents
and such other matters incident to the transactions contemplated herein as the
Agent may reasonably request and (z) shall be in form and substance reasonably
satisfactory to the Agent.
5.04 Corporate Documents; Proceedings. (a) On the Initial Borrowing
--------------------------------
Date, the Agent shall have received from each Credit Party a certificate, dated
the Initial Borrowing Date, signed by the chairman, a vice-chairman, the
president or any vice-president of such Credit Party, and attested to by the
secretary or any assistant secretary of such Credit Party, in the form of
Exhibit F with appropriate insertions, together with copies of the certificate
of incorporation, by-laws or equivalent organizational documents of such Credit
Party and the resolutions of such Credit Party referred to in such certificate
and all of the foregoing (including each such certificate of incorporation, by-
laws or other organizational document) shall be reasonably satisfactory to the
Agent.
(b) On the Initial Borrowing Date, all Company and legal proceedings
and all instruments and agreements in connection with the transactions
contemplated by this Agreement and the other Documents shall be reasonably
satisfactory in form and substance to the Agent, and the Agent shall have
received all information and copies of all certifi xxxxx, documents and papers,
including good standing certificates, bring-down certificates and any other
records of Company proceedings and governmental approvals, if any, which the
Agent reasonably may have requested in connection therewith, such documents and
papers, where appropriate, to be certified by proper Company or governmental
authorities.
(c) On the Initial Borrowing Date and after giving effect to the
Transaction, the capital structure (including, without limitation, the terms of
any capital stock, options, warrants or other securities issued by the Borrower
or any of its Subsidiaries), and management of the Borrower and its Subsidiaries
shall be in form and substance satisfactory to the Agent.
5.05 Adverse Change, etc. (a) On or prior to the Initial Borrowing
--------------------
Date, since December 31, 1996, nothing shall have occurred which (i) the
Required Banks or the Agent shall reasonably determine has had, or could
reasonably be expected to have, a material adverse effect on the rights or
remedies of the Banks or the Agent, or on the abil ity of any Credit Party to
perform its obligations to them hereunder or under any other Credit Document or
(ii) has had a material adverse effect on the Transaction or a Material Adverse
Effect.
(b) On the Initial Borrowing Date, there shall not have occurred and
be con tinuing any material adverse change to the syndication market for credit
facilities similar
-39-
in nature to this Agreement and there shall not have occurred and be continuing
a material disruption or a material adverse change in financial, banking or
capital markets that would have a material adverse effect on the syndication, in
each case as determined by the Agent in its reasonable discretion.
5.06 Litigation. On the Initial Borrowing Date, there shall be no
----------
actions, suits, proceedings or investigations pending or threatened (a) with
respect to this Agreement or any other Document or the Transaction, (b) with
respect to any Existing Indebtedness or (c) which the Agent or the Required
Banks shall determine could reasonably be expected to have (i) a Material
Adverse Effect or (ii) a material adverse effect on the Transaction, the rights
or remedies of the Banks or the Agent hereunder or under any other Credit
Document or on the ability of any Credit Party to perform its respective
obligations to the Banks or the Agent hereunder or under any other Credit
Document.
5.07 Approvals. On or prior to the Initial Borrowing Date, (i) all
---------
necessary governmental (domestic and foreign), regulatory and third party
approvals in connection with any Existing Indebtedness, the Transaction, the
transactions contemplated by the Docu ments and otherwise referred to herein or
therein shall have been obtained and remain in full force and effect and
evidence thereof shall have been provided to the Agent, and (ii) all applicable
waiting periods shall have expired without any action being taken by any com
petent authority which restrains, prevents or imposes materially adverse
conditions upon the consummation of the Transaction, the making of the Loans and
the transactions contem plated by the Documents or otherwise referred to herein
or therein. Additionally, there shall not exist any judgment, order, injunction
or other restraint issued or filed or a hearing seeking injunctive relief or
other restraint pending or notified prohibiting or imposing materially adverse
conditions upon, or materially delaying, or making economically unfeas ible, the
consummation of the Transaction or the making of the Loans.
5.08 Recapitalization, Financing Transactions, etc. (a) On the
----------------------------------------------
Initial Borrowing Date, Newport, Acquisition Corp. and the Borrower shall have
effected the Recapitalization (i) pursuant to which Acquisition Corp. shall have
merged with and into the Borrower, with the Borrower as the surviving
corporation of such merger (the "Alliance Merger") and (ii) as a result of which
(x) Newport shall own approximately 90.0% of the issued and outstanding shares
of Borrower Common Stock and the Alliance Holdover Shareholders shall own
approximately 10.0% of the issued and outstanding shares of Borrower Common
Stock and (y) the Alliance Holdover Shareholders shall retain shares of Borrower
Common Stock with a value of approximately $4,500,000 (the "Equity Retention")
and cash in an aggregate amount not to exceed $165,600,000 shall have been
distributed to the existing shareholders of the Borrower (other than in respect
of equity being retained pursuant to the Equity Retention) (the "Recap
Distribution").
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(b) On the Initial Borrowing Date, (i) Acquisition Corp. shall have
received cash proceeds in an amount equal to at least $40,000,000 from the
issuance of common stock of Acquisition Corp. to Newport (the "Common Equity
Issuance"), (ii) the Borrower shall have received gross cash proceeds from the
issuance of Senior Subordinated Notes in an aggregate principal amount of
$165,000,000 and (iii) the Borrower shall have received gross cash proceeds of
approximately $15,000,000 from the issuance of PIK Preferred Stock.
(c) The Borrower shall have utilized the full amount of the cash
proceeds received by it from the Common Equity Issuance, the issuance of the
Senior Subordinated Notes and the issuance of the PIK Preferred Stock to make
payments owing in connection with the Transaction prior to utilizing any
proceeds of Loans for such purpose.
(d) The Agent shall have received true and correct copies of all
Recapitalization Documents, Common Equity Financing Documents, PIK Preferred
Stock Documents and Senior Subordinated Notes Documents and all terms and
conditions of the foregoing Documents (including, without limitation, in the
case of the Senior Subordinated Notes Documents, amortization, maturities,
interest rates, covenants, defaults, remedies and subordination provisions and,
in the case of PIK Preferred Stock, maturity, limitation on cash dividends
payable, dividend rate and redemption provisions) shall be in form and substance
satisfactory to the Agent and the Required Banks. All conditions precedent to
the consummation of the Transaction as set forth in the Recapitalization
Documents, Common Equity Financing Documents, PIK Preferred Stock Documents and
Senior Subordinated Notes Documents shall have been satisfied and not waived
unless consented to by the Agent and the Required Banks. Each of the
Recapitalization, the Common Equity Issuance, the issuance of the Senior
Subordinated Notes and the issuance of the PIK Preferred Stock shall have been
consummated in accordance with the terms and conditions of the applicable
Documents and all applicable law.
5.09 Refinancing. (a) On the Initial Borrowing Date (after having
-----------
given effect to the Recapitalization) and concurrently with the incurrence of
Loans on such date, approximately $75,200,000 of Indebtedness of the Borrower
consisting of existing Capitalized Lease Obligations, purchase money
indebtedness and all outstanding Indebtedness under the Existing Alliance Credit
Agreement shall have been repaid in full, together with all fees and other
amounts owing thereon (the "Refinanced Indebtedness") and the total commitments
under the Existing Alliance Credit Agreement shall have been terminated.
(b) On the Initial Borrowing Date and concurrently with the
incurrence of Loans on such date, all security interests in respect of, and
Liens securing, the Refinanced Indebtedness shall have been terminated and
released, and the Agent shall have received all such releases as may have been
requested by the Agent, which releases shall be in form
-41-
and substance satisfactory to the Agent and the Required Banks. Without
limiting the foregoing, there shall have been delivered to the Agent (w) proper
termination statements (Form UCC-3 or the appropriate equivalent) for filing
under the UCC of each jurisdiction where a financing statement (Form UCC-1 or
the appropriate equivalent) was filed with respect to the Borrower or any of its
Subsidiaries in connection with the security interests created with respect to
the Refinanced Indebtedness and the documentation related thereto, (x)
terminations or reassignments of any security interest in, or Lien on, any
patents, trademarks, copyrights, or similar interests of the Borrower or any of
its Subsidiaries on which filings have been made, (y) terminations of all
mortgages, leasehold mortgages and deeds of trust created with respect to
property of the Borrower or any of its Subsidiaries, in each case, to secure the
obligations under the Refinanced Indebtedness, all of which shall be in form and
substance satisfactory to the Agent and the Required Banks, and (z) all
collateral owned by the Borrower or any of its Subsidiaries in the possession of
any agent, collateral agent or trustee for the creditors under the Existing
Alliance Credit Agreement or any related security document.
(c) On the Initial Borrowing Date and after giving effect to the
Transaction, the Borrower and its Subsidiaries shall have no Indebtedness or
Preferred Stock outstanding other than (i) the Loans, (ii) the Senior
Subordinated Notes, (iii) the PIK Preferred Stock and (iv) certain other
indebtedness existing on the Initial Borrowing Date as listed on Schedule IV in
an aggregate outstanding principal amount not to exceed $15,000,000 (with the
Indebtedness described in this subclause (iv) being herein called "Existing
Indebtedness"). On and as of the Initial Borrowing Date, all of the Existing
Indebtedness shall remain outstanding after giving effect to the Transaction and
the other transactions contemplated hereby without any default or event of
default existing thereunder or arising as a result of the Transaction and the
other transactions contemplated hereby (except to the extent amended or waived
by the parties thereto on terms and conditions satisfactory to the Agent and the
Required Banks), and there shall not be any amendments or modifications to the
Existing Indebtedness Agreements other than as requested or approved by the
Agent or the Required Banks.
(d) The Agent shall have received evidence in form, scope and
substance satisfactory to the Agent and the Required Banks that the matters set
forth in this Section 5.09 have been satisfied on the Initial Borrowing Date.
5.10 Security Documents; etc. (a) On the Initial Borrowing Date,
------------------------
each of the Credit Parties shall have duly authorized, executed and delivered a
Pledge Agreement in the form of Exhibit G (as amended, modified or supplemented
from time to time in accordance with the terms thereof and hereof, the "Pledge
Agreement") and shall have delivered to the Collateral Agent, as pledgee
thereunder, all of the Pledged Securities referred to therein then owned by such
Credit Parties and required to be pledged pursuant to the terms thereof,
endorsed in blank in the case of promissory notes or accompanied by
-42-
executed and undated stock powers in the case of capital stock, along with
evidence that all other actions necessary or, in the reasonable opinion of the
Collateral Agent, desirable, to perfect the security interests purported to be
created by the Pledge Agreement have been taken, and the Pledge Agreement shall
be in full force and effect.
(b) On the Initial Borrowing Date, each of the Credit Parties shall
have duly authorized, executed and delivered a Security Agreement in the form of
Exhibit H (as amended, modified or supplemented from time to time in accordance
with the terms thereof and hereof, the "Security Agreement") covering all of the
Security Agreement Collateral, together with:
(A) executed copies of Financing Statements (Form UCC-1) or
appropriate local equivalent in appropriate form for filing under the UCC
or appropriate local equivalent of each jurisdiction as may be necessary
or, in the reasonable opinion of the Collateral Agent, desirable to perfect
the security interests purported to be created by the Security Agreement;
(B) certified copies of Requests for Information or Copies (Form UCC-
11), or equivalent reports, each of a recent date listing all effective
financing statements that name the Borrower or any of its Subsidiaries as
debtor and that are filed in the jurisdictions referred to in clause (A)
above, together with copies of such financing statements (none of which
shall cover the Collateral except (x) those with respect to which
appropriate termination statements executed by the secured lender
thereunder have been delivered to the Agent and (y) to the extent
evidencing Permitted Liens);
(C) evidence of the completion of all other recordings and filings
of, or with respect to, the Security Agreement as may be necessary or, in
the reasonable opinion of the Collateral Agent, desirable, to perfect the
security interests purported to be created by the Security Agreement; and
(D) evidence that all other actions necessary or, in the reasonable
opinion of the Collateral Agent, desirable, to perfect the security
interests purported to be created by the Security Agreement have been
taken;
and the Security Agreement shall be in full force and effect.
5.11 Subsidiaries Guaranty. On the Initial Borrowing Date, each
---------------------
Subsidiary Guarantor shall have duly authorized, executed and delivered a
Subsidiaries Guaranty in the form of Exhibit I (as amended, modified or
supplemented from time to time in accordance with the terms thereof and hereof,
the "Subsidiaries Guaranty"), and the Subsidiaries Guaranty shall be in full
force and effect.
-43-
5.12 Employee Benefit Plans; Shareholders' Agreements; Management
------------------------------------------------------------
Agreements; Employment Agreements; Collective Bargaining Agreements; Existing
-----------------------------------------------------------------------------
Indebtedness Agreements; Material Contracts; Tax Allocation Agreements. On or
----------------------------------------------------------------------
prior to the Initial Borrowing Date, there shall have been delivered to the
Agent true and correct copies, certified as true and complete by an appropriate
officer of the Borrower of:
(i) all Plans (and for each Plan that is required to file an
annual report on Internal Revenue Service Form 5500-series, a copy of the
most recent such report (including, to the extent required, the related
financial and actuarial statements and opinions and other supporting
statements, certifications, schedules and information), and for each Plan
that is a "single-employer plan," as defined in Section 4001(a)(15) of
ERISA, the most recently prepared actuarial valuation there for) and any
other "employee benefit plans," as defined in Section 3(3) of ERISA, and
any other material agreements, plans or arrangements, with or for the
benefit of current or former employees of the Borrower or any of its
Subsidiaries or any ERISA Affiliate (provided that the foregoing shall
apply in the case of any multi employer plan, as defined in 4001(a)(3) of
ERISA, only to the extent that any docu ment described therein is in the
possession of the Borrower or any Subsidiary of the Borrower or any ERISA
Affiliate or reasonably available thereto from the sponsor or trustee of
any such plan) (collectively, the "Employee Benefit Plans");
(ii) all agreements (including, without limitation, shareholders'
agree ments, subscription agreements and registration rights agreements)
entered into by the Borrower or any of its Subsidiaries governing the terms
and relative rights of its capital stock and any agreements entered into by
shareholders relating to any such entity with respect to its capital stock
(collectively, the "Shareholders' Agree ments");
(iii) all material agreements with members of, or with respect
to, the management of the Borrower or any of its Subsidiaries after giving
effect to the Transaction (collectively, the "Management Agreements");
(iv) any material employment agreements entered into by the
Borrower or any of its Subsidiaries after giving effect to the Transaction
(collectively, the "Employment Agreements");
(v) all collective bargaining agreements applying or relating to
any employee of the Borrower or any of its Subsidiaries after giving effect
to the Transaction (collectively, the "Collective Bargaining Agreements");
-44-
(vi) all agreements evidencing or relating to Existing
Indebtedness of the Borrower or any of its Subsidiaries after giving effect
to the Refinancing (collectively, the "Existing Indebtedness Agreements");
(vii) all other material contracts and licenses of the Borrower
and any of its Subsidiaries after giving effect to the Transaction
(collectively, the "Material Contracts"); and
(viii) any tax sharing or tax allocation agreements entered into
by the Borrower or any of its Subsidiaries (collectively, the "Tax
Allocation Agreements");
all of which Employee Benefit Plans, Shareholders' Agreements, Management
Agreements, Employment Agreements, Collective Bargaining Agreements, Existing
Indebtedness Agreements, Material Contracts and Tax Allocation Agreements shall
be in form and substance satisfactory to the Agent and the Required Banks and
shall be in full force and effect on the Initial Borrowing Date.
5.13 Consent Letter. On the Initial Borrowing Date, the Agent shall
--------------
have received a letter from CT Corporation System, presently located at 0000
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, substantially in the form of Exhibit J,
indicating its consent to its appointment by each Credit Party as its agent to
receive service of process as specified in Section 13.08 or the Subsidiaries
Guaranty, as the case may be.
5.14 Solvency Certificate; Insurance Certificates. On or before the
--------------------------------------------
Initial Borrowing Date, the Agent shall have received:
(a) a solvency certificate in the form of Exhibit K from the chief
financial officer of the Borrower, dated the Initial Borrowing Date, and
supporting the con clusion that, after giving effect to the Transaction and
the incurrence of all financings contemplated herein, the Borrower (on a
stand-alone basis) and the Borrower and its Subsidiaries (on a consolidated
basis), in each case, are not insolvent and will not be rendered insolvent
by the indebtedness incurred in connection herewith, will not be left with
unreasonably small capital with which to engage in its or their respective
businesses and will not have incurred debts beyond its or their ability to
pay such debts as they mature and become due; and
(b) evidence of insurance complying with the requirements of Section
8.03 for the business and properties of the Borrower and its Subsidiaries,
in scope, form and substance reasonably satisfactory to the Agent and the
Required Banks and naming the Collateral Agent as an additional insured
and/or loss payee, and stating that such insurance shall not be cancelled
or revised without at least 30 days' prior written notice by the insurer to
the Collateral Agent.
-45-
5.15 Financial Statements; Pro Forma Balance Sheet; Projections. (a)
----------------------------------------------------------
On or prior to the Initial Borrowing Date, there shall have been delivered to
the Agent (i) true and correct copies of the financial statements referred to in
Section 7.10(b) and (ii) an unaudited pro forma consolidated balance sheet of
--- -----
the Borrower and its Subsidiaries as of September 30, 1997 and, after giving
effect to the Transaction and the incurrence of all Indebtedness (including the
Loans and the Senior Subordinated Notes) contemplated herein and prepared in
accordance with GAAP (the "Pro Forma Balance Sheet"), together with a related
--- -----
funds flow statement, which financial statements, Pro Forma Balance Sheet and
--- -----
funds flow statement shall be reasonably satisfactory to the Agent and the
Required Banks.
(b) On or prior to the Initial Borrowing Date, there shall have been
deliv ered to the Agent detailed projected consolidated financial statements of
the Borrower and its Subsidiaries certified by the chief financial officer or
treasurer of the Borrower for the six fiscal years ended after the Initial
Borrowing Date (the "Projections"), which Projections (x) shall reflect the
forecasted consolidated financial conditions and income and expenses of the
Borrower and its Subsidiaries after giving affect to the Transaction and the
related financing thereof and the other transactions contemplated hereby and (y)
shall be reasonably satisfactory in form and substance to the Agent and the
Required Banks.
5.16 Payment of Fees. On the Initial Borrowing Date, all costs, fees
---------------
and expenses, and all other compensation due to the Agent or the Banks
(including, without limitation, legal fees and expenses) shall have been paid to
the extent due.
SECTION 6. Conditions Precedent to All Credit Events. The obligation
-----------------------------------------
of each Bank to make Loans (including Loans made on the Initial Borrowing Date
but excluding Mandatory Borrowings made thereafter, which shall be made as
provided in Sec tion 1.01(d)), and the obligation of a Letter of Credit Issuer
to issue any Letter of Credit, is subject, at the time of each such Credit Event
(except as hereinafter indicated), to the sat isfaction of the following
conditions:
6.01 No Default; Representations and Warranties. At the time of each
------------------------------------------
such Credit Event and also after giving effect thereto (i) there shall exist no
Default or Event of Default and (ii) all representations and warranties
contained herein or in any other Credit Document shall be true and correct in
all material respects with the same effect as though such representations and
warranties had been made on the date of such Credit Event (it being understood
and agreed that any representation or warranty which by its terms is made as of
a specified date shall be required to be true and correct in all material
respects only as of such specified date).
6.02 Notice of Borrowing; Letter of Credit Request. (a) Prior to
---------------------------------------------
the mak ing of each Loan (excluding Swingline Loans and Mandatory Borrowings),
the Agent shall
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have received a Notice of Borrowing meeting the requirements of Section 1.03(a).
Prior to the making of any Swingline Loan, BTCo shall have received the notice
required by Section 1.03(b)(i).
(b) Prior to the issuance of each Letter of Credit, the Agent and the
respective Letter of Credit Issuer shall have received a Letter of Credit
Request meeting the requirements of Section 2.02(a).
The occurrence of the Initial Borrowing Date and the acceptance of the
bene fits or proceeds of each Credit Event shall constitute a representation and
warranty by the Borrower to the Agent and each of the Banks that all the
conditions specified in Section 5 and in this Section 6 and applicable to such
Credit Event (other than such conditions that are subject to the satisfaction of
the Agent and/or the Required Banks) exist as of that time. All of the Notes,
certificates, legal opinions and other documents and papers referred to in
Section 5 and in this Section 6, unless otherwise specified, shall be delivered
to the Agent at the Notice Office for the account of each of the Banks and,
except for the Notes, in sufficient counterparts or copies for each of the Banks
and shall be in form and substance satisfactory to the Banks.
SECTION 7. Representations and Warranties. In order to induce the
------------------------------
Banks to enter into this Agreement and to make the Loans and issue and/or
participate in the Letters of Credit provided for herein, the Borrower makes the
following representations and warranties with the Banks, all of which shall
survive the execution and delivery of this Agreement, the making of the Loans
and the issuance of the Letters of Credit (with the occurrence of each Credit
Event being deemed to constitute a representation and warranty that the matters
specified in this Section 7 are true and correct in all material respects on and
as of the date of each such Credit Event, unless stated to relate to a specific
earlier date in which case such representations and warranties shall be true and
correct in all material respects as of such earlier date):
7.01 Corporate Status. Each of the Borrower and each of its
----------------
Subsidiaries (i) is a duly organized and validly existing Company in good
standing under the laws of the jurisdiction of its organization, (ii) has the
Company power and authority to own its property and assets and to transact the
business in which it is engaged and presently pro poses to engage and (iii) is
duly qualified and is authorized to do business and is in good standing in all
jurisdictions where it is required to be so qualified and where the failure to
be so qualified would have a Material Adverse Effect.
7.02 Company Power and Authority. Each Credit Party has the Company
---------------------------
power and authority to execute, deliver and carry out the terms and provisions
of the Docu ments to which it is a party and has taken all necessary Company
action to authorize the
-47-
execution, delivery and performance of the Documents to which it is a party.
Each Credit Party has duly executed and delivered each Document to which it is a
party and each such Document constitutes the legal, valid and binding obligation
of such Credit Party enforce able in accordance with its terms, except to the
extent that the enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws generally affecting
creditors' rights and by equitable principles (regardless of whether enforcement
is sought in equity or at law).
7.03 No Violation. Neither the execution, delivery or performance by
------------
any Credit Party of the Documents to which it is a party, nor compliance by any
Credit Party with the terms and provisions thereof, nor the consummation of the
transactions contem plated herein or therein, (i) will contravene any material
provision of any applicable law, statute, rule or regulation, or any order,
writ, injunction or decree of any court or govern mental instrumentality, (ii)
will conflict or be inconsistent with or result in any breach of, any of the
terms, covenants, conditions or provisions of, or constitute a default under, or
(other than pursuant to the Security Documents) result in the creation or
imposition of (or the obligation to create or impose) any Lien upon any of the
property or assets of the Borrower or any of its Subsidiaries pursuant to the
terms of any indenture, mortgage, deed of trust, loan agreement, credit
agreement or any other material agreement or instrument to which the Borrower or
any of its Subsidiaries is a party or by which it or any of its property or
assets are bound or to which it may be subject (including, without limitation,
the Existing Indebtedness) or (iii) will violate any provision of the
certificate of incorpor ation, by-laws, certificate of partnership, partnership
agreement, certificate of limited liability company, limited liability company
agreement or equivalent organizational document, as the case may be, of the
Borrower or any of its Subsidiaries.
7.04 Litigation. There are no actions, suits, proceedings or
----------
investigations pending or threatened (i) with respect to any Credit Document,
(ii) with respect to the Transaction or any other Document that could reasonably
be expected to have a Material Adverse Effect, or (iii) with respect to the
Borrower or any of its Subsidiaries (x) that are likely to have a Material
Adverse Effect or (y) that could reasonably be expected to have a material
adverse effect on the rights or remedies of the Agent or the Banks or on the
ability of any Credit Party to perform its respective obligations to the Agent
or the Banks hereunder and under the other Credit Documents to which it is, or
will be, a party. Addi tionally, there does not exist any judgment, order or
injunction prohibiting or imposing material adverse conditions upon the
occurrence of any Credit Event.
7.05 Use of Proceeds; Margin Regulations. (a) The proceeds of all
-----------------------------------
Term Loans incurred on the Initial Borrowing Date shall be utilized by the
Borrower to (i) finance the Recapitalization (including the Recap Distribution)
and the Refinancing and (ii) pay the fees and expenses incurred in connection
with the Transaction.
-48-
(b) The proceeds of all Revolving Loans and Swingline Loans shall be
utilized for the general corporate and working capital purposes of the Borrower
and its Subsidiaries (including, but not limited to, Permitted Acquisitions and
the prepayment of Existing Indebtedness and the Senior Subordinated Notes in
accordance with the terms of Section 9.12(ii)); provided, however, that,
-------- -------
proceeds of Revolving Loans and Swingline Loans may not be used for the purposes
described in Section 7.05(a) above.
(c) Neither the making of any Loan, nor the use of the proceeds
thereof, nor the occurrence of any other Credit Event, will violate or be
inconsistent with the pro visions of Regulation G, T, U or X of the Board of
Governors of the Federal Reserve System and no part of any Credit Event (or the
proceeds thereof) will be used to purchase or carry any Margin Stock or to
extend credit for the purpose of purchasing or carrying any Margin Stock.
7.06 Governmental Approvals. Except as may have been obtained or
----------------------
made on or prior to the Initial Borrowing Date (and which remain in full force
and effect on the Initial Borrowing Date), no order, consent, approval, license,
authorization or validation of, or filing, recording or registration with, or
exemption by, any foreign or domestic governmental or public body or authority,
or any subdivision thereof, is required to autho rize or is required in
connection with (i) the execution, delivery and performance of any Document or
(ii) the legality, validity, binding effect or enforceability of any Document.
7.07 Investment Company Act. Neither the Borrower nor any of its Sub
----------------------
sidiaries is an "investment company" or a company "controlled" by an "investment
com pany," within the meaning of the Investment Company Act of 1940, as amended.
7.08 Public Utility Holding Company Act. Neither the Borrower nor
----------------------------------
any of its Subsidiaries is a "holding company," or a "subsidiary company" of a
"holding com pany," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company," within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
7.09 True and Complete Disclosure. All factual information (taken as
----------------------------
a whole) heretofore or contemporaneously furnished by or on behalf of the
Borrower or any of its Subsidiaries in writing to the Agent or any Bank
(including, without limitation, all information contained in the Documents) for
purposes of or in connection with this Agreement or any transaction contemplated
herein or therein is, and all other such factual information (taken as a whole)
hereafter furnished by or on behalf of any such Persons in writing to the Agent
or any Bank will be, true and accurate in all material respects on the date as
of which such information is dated or certified and not incomplete by omitting
to state any material fact necessary to make such information (taken as a whole)
not mislead ing at such time in light of the circumstances under which such
information was provided.
-49-
7.10 Financial Condition; Financial Statements. (a) On and as of
-----------------------------------------
the Initial Borrowing Date, on a pro forma basis after giving effect to the
--- -----
Transaction and to all Indebtedness (including the Loans and the Senior
Subordinated Notes) incurred, and to be incurred, and Liens created, and to be
created, by each Credit Party in connection there with, with respect to the
Borrower (on a stand-alone basis) and the Borrower and its Subsidiaries (on a
consolidated basis) (x) the sum of the assets, at a fair valuation, of the
Borrower (on a stand-alone basis) and the Borrower and its Subsidiaries (on a
consolidated basis) will exceed its or their debts, (y) it has or they have not
incurred nor intended to, nor believes or believe that it or they will, incur
debts beyond its or their ability to pay such debts as such debts mature and (z)
it or they will have sufficient capital with which to conduct its or their
business. For purposes of this Section 7.10, "debt" means any liability on a
claim, and "claim" means (i) right to payment, whether or not such a right is
reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (ii)
right to an equitable remedy for breach of performance if such breach gives rise
to a payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured
or unsecured.
(b)(i) The consolidated balance sheets of the Borrower at December
31, 1995, December 31, 1996 and September 30, 1997, and the related statements
of income and cash flows and changes in shareholders' equity of the Borrower for
the fiscal years or nine-month period, as the case may be, ended as of said
dates, and (ii) the Pro-Forma Balance Sheet, copies of which have heretofore
been furnished to each Bank, present fairly in all material respects the
respective consolidated financial condition of the Borrower at the dates of said
financial statements and the results for the periods covered thereby (or, in the
case of the Pro Forma Balance Sheet, presents a good faith estimate of the
--- -----
consolidated pro forma financial condition of the Borrower (after giving effect
--- -----
to the Transaction at the date thereof), subject, in the case of unaudited
financial statements, to normal year-end adjustments. All such financial
statements (other than the aforesaid Pro Forma Balance Sheet) have been prepared
--- -----
in accordance with GAAP consistently applied except to the extent provided in
the notes to said financial statements and subject, in the case of the nine-
month statements, to normal year-end audit adjustments (all of which are of a
recurring nature and none of which, individually or in the aggregate, would be
material) and the absence of footnotes.
(c) Since December 31, 1996 (but after giving effect to the
Transaction as if same had occurred prior thereto), nothing has occurred that
has had or could reasonably be expected to have a Material Adverse Effect.
(d) Except as fully reflected in the financial statements described
in Section 7.10(b) and the Indebtedness incurred under this Agreement and the
Senior Subordinated Notes, (i) there were as of the Initial Borrowing Date (and
after giving effect to any Loans
-50-
made on such date), no liabilities or obligations (excluding current obligations
incurred in the ordinary course of business and commitments to purchase
Healthcare Units) with respect to the Borrower or any of its Subsidiaries of any
nature whatsoever (whether absolute, accrued, contingent or otherwise and
whether or not due) which, either individually or in the aggregate, could
reasonably be expected to be material to the Borrower and its Subsidiaries taken
as a whole or the Borrower and (ii) the Borrower does not know of any basis for
the assertion against the Borrower or any of its Subsidiaries of any such
liability or obligation which, either individually or in the aggregate, are or
would be reasonably likely to have, a Material Adverse Effect.
(e) The Projections have been prepared on a basis consistent with the
xxxxx cial statements referred to in Section 7.10(b), and are based on good
faith estimates and assumptions made by the management of the Borrower. On the
Initial Borrowing Date, such management believed that the Projections were
reasonable and attainable. There is no fact known to the Borrower or any of its
Subsidiaries which could reasonably be expected to have a Material Adverse
Effect, which has not been disclosed herein or in such other documents,
certificates and statements furnished to the Banks for use in connection with
the transactions contemplated hereby.
7.11 Security Interests. On and after the Initial Borrowing Date,
------------------
each of the Security Documents creates (or after the execution and delivery
thereof will create), as security for the Obligations, a valid and enforceable
perfected security interest in and Lien on all of the Collateral subject
thereto, superior to and prior to the rights of all third Persons, and subject
to no other Liens (except that (i) the Security Agreement Collateral may be
subject to Permitted Liens relating thereto and (ii) the Pledge Agreement
Collateral may be subject to the Liens described in clauses (a) and (e) of
Section 9.03), in favor of the Collateral Agent. No filings or recordings are
required in order to perfect the security interests created under any Security
Document except for filings or recordings required in connection with any such
Security Document which shall have been made on or prior to the Initial
Borrowing Date as contemplated by Section 5.11 or on or prior to the execution
and delivery thereof as contemplated by Sections 8.11, 8.12 and 9.15.
7.12 Compliance with ERISA. Schedule V sets forth each Plan; each
---------------------
Plan (and each related trust, insurance contract or fund) is in substantial
compliance with its terms and with all applicable laws, including without
limitation ERISA and the Code; each Plan (and each related trust, if any) which
is intended to be qualified under Section 401(a) of the Code has received a
determination letter from the Internal Revenue Service to the effect that it
meets the requirements of Sections 401(a) and 501(a) of the Code; no Reportable
Event has occurred; no Plan which is a multiemployer plan (as defined in Sec
tion 4001(a)(3) of ERISA) is insolvent or in reorganization; no Plan has an
Unfunded Current Liability; no Plan which is subject to Section 412 of the Code
or Section 302 of ERISA has an accumulated funding deficiency, within the
meaning of such sections of the
-51-
Code or ERISA, or has applied for or received a waiver of an accumulated funding
defici ency or an extension of any amortization period, within the meaning of
Section 412 of the Code or Section 303 or 304 of ERISA; all contributions
required to be made with respect to a Plan have been timely made; neither the
Borrower nor any Subsidiary of the Borrower nor any ERISA Affiliate has incurred
any material liability (including any indirect, contin gent or secondary
liability) to or on account of a Plan pursuant to Section 409, 502(i), 502(l),
515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29),
4971 or 4975 of the Code or expects to incur any such liability under any of the
foregoing sections with respect to any Plan; no condition exists which presents
a material risk to the Borrower or any Subsidiary of the Borrower or any ERISA
Affiliate of incurring a liability to or on account of a Plan pursuant to the
foregoing provisions of ERISA and the Code; no proceedings have been instituted
to terminate or appoint a trustee to administer any Plan which is subject to
Title IV of ERISA; no action, suit, proceeding, hearing, audit or investi gation
with respect to the administration, operation or the investment of assets of any
Plan (other than routine claims for benefits) is pending, expected or
threatened; using actuarial assumptions and computation methods consistent with
Part 1 of subtitle E of Title IV of ERISA, the aggregate liabilities of the
Borrower and its Subsidiaries and its ERISA Affiliates to all Plans which are
multiemployer plans (as defined in Section 4001(a)(3) of ERISA) in the event of
a complete withdrawal therefrom, as of the close of the most recent fiscal year
of each such Plan ended prior to the date of the most recent Credit Event, would
not exceed $50,000; each group health plan (as defined in Section 607(1) of
ERISA or Sec tion 4980B(g)(2) of the Code) which covers or has covered employees
or former employees of the Borrower, any Subsidiary of the Borrower or any ERISA
Affiliate has at all times been operated in compliance with the provisions of
Part 6 of subtitle B of Title I of ERISA and Section 4980B of the Code; no lien
imposed under the Code or ERISA on the assets of the Borrower or any Subsidiary
of the Borrower or any ERISA Affiliate exists or is likely to arise on account
of any Plan; and the Borrower and its Subsidiaries may cease contributions to or
terminate any employee benefit plan maintained by any of them without incurring
any material liability.
7.13 Capitalization. On the Initial Borrowing Date and after giving
--------------
effect to the Transaction, the authorized capital stock of the Borrower shall
consist of (i) 10,000,000 shares of common stock, $.01 par value per share (such
authorized shares of common stock, together with any subsequently authorized
shares of common stock of the Borrower, the "Borrower Common Stock"), 4,043,250
of which shares shall be issued and outstanding and (ii) 500,000 shares of PIK
Preferred Stock, 300,000 of which shares shall be designated the "Series F
Preferred Stock", of which 150,000 shares shall be issued and outstanding. All
such outstanding shares have been duly and validly issued, are fully paid and
nonassessable and have been issued free of preemptive rights. Except as set
forth on Schedule X hereto, the Borrower does not have outstanding any
securities convertible into or exchangeable for its capital stock or outstanding
any rights to subscribe for or to purchase, or any options for the purchase of,
or any agreements providing for the issuance
-52-
(contingent or otherwise) of, or any calls, commitments or claims of any
character relating to, its capital stock.
7.14 Subsidiaries. (a) Prior to the consummation of the
------------
Transaction, Acquisition Corp. has no Subsidiaries.
(b) On and as of the Initial Borrowing Date and after giving effect
to the Transaction, (i) the Borrower has no Subsidiaries other than those
Subsidiaries listed on Schedule VII. Schedule VII correctly sets forth, as of
the Initial Borrowing Date and after giving effect to the Transaction, the
percentage ownership (direct and indirect) of the Borrower in each class of
capital stock of each of its Subsidiaries and also identifies the direct owner
thereof. All outstanding shares of capital stock of each Subsidiary of the
Borrower have been duly and validly issued, are fully paid and non-assessable
and have been issued free of preemptive rights. Except as set forth on Schedule
X hereto, no Subsidiary of the Borrower has outstanding any securities
convertible into or exchangeable for its capital stock or outstanding any right
to subscribe for or to purchase, or any options or warrants for the purchase of,
or any agreement providing for the issuance (contingent or otherwise) of or any
calls, commitments or claims of any character relating to, its capital stock or
any stock appreciation or similar rights.
7.15 Intellectual Property, etc. Each of the Borrower and each of
---------------------------
its Subsidiaries owns all patents, trademarks, permits, service marks, trade
names, technology copyrights, licenses, franchises and formulas, or other rights
with respect to the foregoing, and has obtained assignments of all leases and
other rights of whatever nature, and has in full force and effect all
accreditations and certifications, reasonably necessary for the conduct of its
business, without any known conflict with the rights of others which, or the
failure to obtain which, as the case may be, would result in a Material Adverse
Effect.
7.16 Compliance with Statutes, etc. Each of the Borrower and each of
------------------------------
its Subsidiaries is in compliance with all applicable statutes, regulations,
rules and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property, except such non-compliance as is not
likely to, individually or in the aggregate, have a Material Adverse Effect.
7.17 Environmental Matters. (a) Each of the Borrower and each of
---------------------
its Subsidiaries has complied with, and on the date of each Credit Event is in
compliance with, all applicable Environmental Laws and the requirements of any
permits issued under such Environmental Laws and neither the Borrower nor any of
its Subsidiaries is liable for any material penalties, fines or forfeitures for
failure to comply with any of the foregoing. There are no pending or past or,
to the best knowledge of the Borrower after due inquiry, threatened
Environmental Claims against the Borrower or any of its Subsidiaries or any
-53-
Real Property owned or operated by the Borrower or any of its Subsidiaries.
There are no facts, circumstances, conditions or occurrences on any Real
Property owned or operated by the Borrower or any of its Subsidiaries or on any
property adjoining or in the vicinity of any such Real Property that would
reasonably be expected (i) to form the basis of an Environmental Claim against
the Borrower or any of its Subsidiaries or any such Real Property or (ii) to
cause any such Real Property to be subject to any restrictions on the ownership,
occupancy, use or transferability of such Real Property by the Borrower or any
of its Subsidiaries under any applicable Environmental Law.
(b) Hazardous Materials have not at any time been generated, used,
treated or stored on, or transported to or from, any Real Property owned or
operated by the Borrower or any of its Subsidiaries except in compliance with
all applicable Environmental Laws and reasonably required in connection with the
operation, use and maintenance of such Real Property by the Borrower's or such
Subsidiary's business. Hazardous Materials have not at any time been Released
on or from any Real Property owned or operated by the Borrower or any of its
Subsidiaries. There are not now any underground storage tanks located on any
Real Property owned or operated by the Borrower or any of its Subsidiaries.
(c) Notwithstanding anything to the contrary in this Section 7.17,
the representations made in this Section 7.17 shall only be untrue if the
aggregate effect of all conditions, failures, noncompliances, Environmental
Claims, Releases and presence of underground storage tanks, in each case of the
types described above, would reasonably be expected to have a Material Adverse
Effect.
7.18 Properties. All Real Property owned by the Borrower or any of
----------
its Subsidiaries and all material Leaseholds leased by the Borrower or any of
its Subsidiaries, in each case as of the Initial Borrowing Date and after giving
effect to the Transaction, and the nature of the interest therein, is correctly
set forth in Schedule III. Each of the Borrower and each of its Subsidiaries
has good and marketable title to, or a validly subsisting leasehold interest in,
all material properties owned or leased by it, including all Real Property
reflected in Schedule III and in the financial statements (including the Pro
---
Forma Balance Sheet) referred to in Section 7.10(b) (except such properties sold
-----
in the ordinary course of business since the dates of the respective financial
statements referred to therein), free and clear of all Liens, other than
Permitted Liens.
7.19 Labor Relations. Neither the Borrower nor any of its
---------------
Subsidiaries is engaged in any unfair labor practice that could reasonably be
expected to have a Material Adverse Effect. There is (i) no unfair labor
practice complaint pending against the Borrower or any of its Subsidiaries or
threatened against any of them, before the National Labor Relations Board, and
no grievance or arbitration proceeding arising out of or under any collective
bargaining agreement is so pending against the Borrower or any of its
Subsidiaries or threatened against any of them, (ii) no strike, labor dispute,
slowdown or
-54-
stoppage pending against the Borrower or any of its Subsidiaries or threatened
against the Borrower or any of its Subsidiaries and (iii) no union
representation question existing with respect to the employees of the Borrower
or any of its Subsidiaries and no union organizing activities are taking place,
except (with respect to any matter specified in clause (i), (ii) or (iii) above,
either individually or in the aggregate) such as is not reasonably likely to
have a Material Adverse Effect.
7.20 Tax Returns and Payments. Each of the Borrower and each of its
------------------------
Subsidiaries has filed all federal income tax returns and all other material tax
returns, domestic and foreign, required to be filed by it and has paid all
material taxes and assessments payable by it which have become due, except for
those contested in good faith and adequately disclosed and fully provided for on
the financial statements of the Borrower and its Subsidiaries in accordance with
generally accepted accounting principles. Each of the Borrower and each of its
Subsidiaries has at all times paid, or have provided adequate reserves (in the
good faith judgment of the management of the Borrower) for the payment of, all
federal, state and foreign income taxes applicable for all prior fiscal years
and for the current fiscal year to date. There is no material action, suit,
proceeding, investigation, audit, or claim now pending or, to the knowledge of
the Borrower or any of its Subsidiaries, threatened by any authority regarding
any taxes relating to the Borrower or any of its Subsidiaries. Neither the
Borrower nor any of its Subsidiaries has entered into an agreement or waiver or
been requested to enter into an agreement or waiver extending any statute of
limitations relating to the payment or collection of taxes of the Borrower or
any of its Subsidiaries, or is aware of any circumstances that would cause the
taxable years or other taxable periods of the Borrower or any of its
Subsidiaries not to be subject to the normally applicable statute of
limitations.
7.21 Existing Indebtedness. Schedule IV sets forth a true and
---------------------
complete list of all Existing Indebtedness of the Borrower and its Subsidiaries
as of the Initial Borrowing Date after giving effect to the Transaction, in each
case showing the aggregate principal amount thereof and the name of the
respective borrower and any other entity which directly or indirectly guaranteed
such debt.
7.22 Insurance. Set forth on Schedule VIII hereto is a true, correct
---------
and complete summary of all insurance carried by each Credit Party on and as of
the Initial Borrowing Date, with the amounts insured set forth therein.
7.23 Representations and Warranties in Other Documents. All
-------------------------------------------------
representa tions and warranties set forth in the other Documents were true and
correct in all material respects at the time as of which such representations
and warranties were made (or deemed made) and shall be true and correct in all
material respects as of the Initial Borrowing Date as if such representations or
warranties were made on and as of such date, unless stated to
-55-
relate to a specific earlier date, in which case such representations or
warranties shall be true and correct in all material respects as of such earlier
date.
7.24 Transaction. At the time of consummation thereof, the
-----------
Transaction shall have been consummated in accordance with the terms of the
Documents and all applicable laws. At the time of consummation thereof, all
consents and approvals of, and filings and registrations with, and all other
actions in respect of, all governmental agencies, authorities or
instrumentalities required in order to make or consummate the Transaction in
accordance with the terms of the Documents and all applicable laws have been
obtained, given, filed or taken and are or will be in full force and effect (or
effective judicial relief with respect thereto has been obtained). All
applicable waiting periods with respect thereto have or, prior to the time when
required, will have, expired without, in all such cases, any action being taken
by any competent authority which restrains, prevents, or imposes material
adverse conditions upon the Transaction. Additionally, there does not exist any
judgment, order or injunction prohibiting or imposing material adverse
conditions upon any element of the Transaction, the occurrence of any Credit
Event, or the performance by the Borrower and its Subsidiaries of their
respective obligations under the Documents and all applicable laws.
7.25 Special Purpose Corporations. Acquisition Corp. was formed to
----------------------------
effect the Transaction. Prior to the consummation of the Transaction,
Acquisition Corp. had no significant assets or liabilities (other than those
liabilities under the Recapitalization Documents and such other liabilities
arising in connection with the Transaction).
7.26 Subordination. The subordination provisions contained in the
-------------
Senior Subordinated Note Documents are enforceable against the Borrower and the
holder thereof, and all Obligations shall be within the definition of "Senior
Debt" included in such subordination provisions.
SECTION 8. Affirmative Covenants. The Borrower hereby covenants and
---------------------
agrees that as of the Effective Date and thereafter for so long as this
Agreement is in effect and until the Total Commitment has terminated, no Letters
of Credit or Notes are outstanding and the Loans and Unpaid Drawings, together
with interest, Fees and all other Obligations (other than any indemnities
described in Section 13.13 which are not then due and payable) incurred
hereunder, are paid in full:
-56-
8.01 Information Covenants. The Borrower will furnish to each Bank:
---------------------
(a) Monthly Reports. Within 30 days after the end of each fiscal
---------------
month of the Borrower, the consolidated balance sheet of the Borrower and
its Subsidiaries as at the end of such fiscal month and the related
consolidated statements of income for such fiscal month and for the elapsed
portion of the fiscal year ended with the last day of such fiscal month, in
each case setting forth comparative figures for the corresponding fiscal
month in the prior fiscal year and comparable budgeted figures for such
fiscal month as set forth in the respective budget delivered pursuant to
Section 8.01(d), all of which shall be certified by the chief financial
officer or other Authorized Officer of the Borrower, subject to normal
year-end audit adjustments and the absence of footnotes.
(b) Quarterly Financial Statements. Within 45 days after the close
------------------------------
of the first three quarterly accounting periods in each fiscal year of the
Borrower, (i) the consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such quarterly accounting period and the
related consolidated statements of income and retained earnings and of cash
flows for such quarterly accounting period and for the elapsed portion of
the fiscal year ended with the last day of such quarterly account ing
period and the budgeted figures for such quarterly period as set forth in
the respective budget delivered pursuant to Section 8.01(d) and (ii)
management's dis cussion and analysis of the most important operational and
financial developments during such quarterly period, all of which shall be
in reasonable detail and certified by the chief financial officer or other
Authorized Officer of the Borrower that they fairly present in all material
respects the financial condition of the Borrower and its Subsidiaries as of
the dates indicated and the results of their operations and changes in
their cash flows for the periods indicated, subject to normal year-end
audit adjust ments and the absence of footnotes.
(c) Annual Financial Statements. Within 90 days after the close of
---------------------------
each fis cal year of the Borrower, the consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of such fiscal year and the
related consolidated statements of income and retained earnings and of cash
flows for such fiscal year and setting forth comparative consolidated
figures for the preceding fiscal year and comparable budgeted figures for
such fiscal year as set forth in the respective budget delivered pursuant
to Section 8.01(d) and (except for such comparable budgeted figures) cert
ified by Ernst & Young, LLP or such other independent certified public
accountants of recognized national standing as shall be reasonably
acceptable to the Agent, in each case to the effect that such statements
fairly present in all material respects the financial condition of the
Borrower and its Subsidiaries as of the dates indicated and the results of
their operations and changes in financial position for the periods
indicated in conformity with GAAP applied on a basis consistent with prior
years,
-57-
together with a certificate of such accounting firm stating that in the
course of its regular audit of the business of the Borrower and its
Subsidiaries, which audit was conducted in accordance with generally
accepted auditing standards, no Default or Event of Default which has
occurred and is continuing has come to their attention or, if such a
Default or an Event of Default has come to their attention, a statement as
to the nature thereof.
(d) Budgets, etc. Not more than 60 days after the commencement of
-------------
each fiscal year of the Borrower, consolidated budgets of the Borrower and
its Subsidiaries (x) in reasonable detail for each of the twelve months of
such fiscal year and (y) in summary form for each of the five fiscal years
immediately following such fiscal year, in each case as customarily
prepared by management for its internal use setting forth, with appropriate
discussion, the principal assumptions upon which such budgets are based.
Together with each delivery of financial statements pursuant to Sections
8.01(a), (b) and (c), a comparison of the current year to date financial
results against the budgets required to be submitted pursuant to this
clause (d) shall be presented.
(e) Officer's Certificates. At the time of the delivery of the
----------------------
financial state ments provided for in Sections 8.01(a), (b) and (c), a
certificate of the chief financial officer or other Authorized Officer of
the Borrower to the effect that no Default or Event of Default exists or,
if any Default or Event of Default does exist, specifying the nature and
extent thereof, which certificate shall, if delivered in connection with
the financial statements in respect of a period ending on the last day of a
fiscal quarter or fiscal year of the Borrower, set forth (x) the
calculations required to establish whether the Borrower and its
Subsidiaries were in compliance with the provisions of Sections 3.03, 9.02,
9.04(d), (g) and (j), 9.05(a), (g), (l) and (m) and 9.08 through and
including 9.11 as at the end of such fiscal quarter or year, as the case
may be, and (y) the calculation of the Total Leverage Ratio, the Adjusted
Total Leverage Ratio and the Adjusted Senior Leverage Ratio as at the last
day of the respective fiscal quarter or fiscal year of the Borrower, as the
case may be. In addition, at the time of the delivery of the financial
statements provided for in Section 8.01(c), a certificate of the chief
financial officer or other Authorized Officer of the Borrower setting forth
(in reasonable detail) (i) the amount of, and calculations required to
establish the amount of, Adjusted Excess Cash Flow for the Excess Cash Flow
Period ending on the last day of the respective fiscal year and (ii) the
calculations required to establish whether the Borrower was in compliance
with Section 4.02(c) for the respective fiscal year.
(f) Notice of Default or Litigation. Promptly, and in any event
-------------------------------
within three Business Days after an officer of the Borrower or any of its
Subsidiaries obtains actual knowledge thereof, notice of (i) the occurrence
of any event which constitutes
-58-
a Default or an Event of Default, which notice shall specify the nature and
period of existence thereof and what action the Borrower proposes to take
with respect thereto, (ii) any litigation or proceeding pending or
threatened (x) against the Borrower or any of its Subsidiaries which could
reasonably be expected to have a Material Adverse Effect, (y) with respect
to any material Indebtedness of the Borrower or any of its Subsidiaries or
(z) with respect to any Document (other than such Documents referred to in
clause (viii) of the definition thereof), (iii) any governmental
investigation pending or threatened against the Borrower or any of its
Subsidiaries and (iv) any other event which could reasonably be expected to
have a Material Adverse Effect.
(g) Auditors' Reports. Promptly upon receipt thereof, a copy of each
-----------------
report or "management letter" submitted to the Borrower or any of its
Subsidiaries by its independent accountants in connection with any annual,
interim or special audit made by them of the books of the Borrower or any
of its Subsidiaries and the management's non-privileged responses thereto.
(h) Environmental Matters. Promptly after an officer of the Borrower
---------------------
or any of its Subsidiaries obtains actual knowledge of any of the following
(but only to the extent that any of the following, either individually or
in the aggregate, could reasonably be expected to (x) have a Material
Adverse Effect or (y) result in a remedial cost to the Borrower or any of
its Subsidiaries in excess of $300,000), written notice of:
(i) any pending or threatened Environmental Claim against the
Borrower or any of its Subsidiaries or any Real Property owned or
operated by the Borrower or any of its Subsidiaries;
(ii) any condition or occurrence on any Real Property owned or
operated by the Borrower or any of its Subsidiaries that (x) results
in noncompliance by the Borrower or any of its Subsidiaries with any
applic able Environmental Law or (y) could reasonably be anticipated
to form the basis of an Environmental Claim against the Borrower or
any of its Subsidiaries or any such Real Property;
(iii) any condition or occurrence on any Real Property owned
or operated by the Borrower or any of its Subsidiaries that could
reasonably be anticipated to cause such Real Property to be subject to
any restrictions on the ownership, occupancy, use or transferability
by the Borrower or such Subsidiary, as the case may be, of its
interest in such Real Property under any Environmental Law; and
-59-
(iv) the taking of any removal or remedial action in response
to the actual or alleged presence of any Hazardous Material on any
Real Property owned or operated by the Borrower or any of its
Subsidiaries.
All such notices shall describe in reasonable detail the nature of the
claim, investigation, condition, occurrence or removal or remedial action
and the Borrower's response or proposed response thereto. In addition, the
Borrower agrees to provide the Banks with copies of all material
communications by the Borrower or any of its Subsidiaries with any Person,
government or governmental agency relating to Environmental Laws or to any
of the matters set forth in clauses (i)-(iv) above, and such detailed
reports relating to any of the matters set forth in clauses (i)-(iv) above
as may reasonably be requested by the Agent or the Required Banks.
(i) Annual Meetings with Banks. At the request of the Agent, the
--------------------------
Borrower shall within 120 days after the close of each of its fiscal years,
hold a meeting (at a mutually agreeable location and time) open to all of
the Banks at which meeting shall be reviewed the financial results of the
previous fiscal year and the financial condition of the Borrower and its
Subsidiaries and the budgets presented for the current fiscal year of the
Borrower and its Subsidiaries.
(j) Notice of Commitment Reductions and Mandatory Repayments. On or
--------------------------------------------------------
prior to the date of any reduction to the Total Commitment or any mandatory
repayment of outstanding Term Loans pursuant to any of Sections 4.02(c)
through (g), inclusive, the Borrower shall provide written notice of the
amount of the respective reduction or repayment, as the case may be, to
each of the Total Term Loan Commitment, the Total Revolving Loan Commitment
or the outstanding Term Loans, as applicable, and the calculation thereof
(in reasonable detail).
(k) Other Information. Promptly upon transmission thereof, copies of
-----------------
any filings and registrations with, and reports to, the SEC by the Borrower
or any of its Subsidiaries and copies of all financial statements, proxy
statements, notices and reports as the Borrower or any of its Subsidiaries
shall send generally to analysts and the holders of their capital stock
(including, in the case of the Borrower, PIK Preferred Stock) or of the
Senior Subordinated Notes or any Permitted Debt in their capacity as such
holders (to the extent not theretofore delivered to the Banks pursuant to
this Agreement) and, with reasonable promptness, such other infor mation or
documents (financial or otherwise) as the Agent on its own behalf or on
behalf of the Required Banks may reasonably request from time to time.
8.02 Books, Records and Inspections. The Borrower will, and will
------------------------------
cause each of its Subsidiaries to, keep proper books of record and account in
which full, true and
-60-
correct entries in conformity with GAAP and all requirements of law shall be
made of all dealings and transactions in relation to its business and
activities. The Borrower will, and will cause each of its Subsidiaries to,
permit, upon notice to the chief financial officer or other Authorized Officer
of the Borrower, officers and designated representatives of the Agent or the
Required Banks to visit and inspect any of the properties or assets of the
Borrower and any of its Subsidiaries in whomsoever's possession, and to examine
the books of account of the Borrower and any of its Subsidiaries and discuss the
affairs, finances and accounts of the Borrower and of any of its Subsidiaries
with, and be advised as to the same by, their officers and independent
accountants, all at such reasonable times and intervals and to such reasonable
extent as the Agent or the Required Banks may desire.
8.03 Insurance. (a) The Borrower will, and will cause each of its
---------
Subsidi aries to (i) maintain, with financially sound and reputable insurance
companies, insurance on all its property in at least such amounts and against at
least such risks as is consistent and in accordance with industry practice and
(ii) furnish to the Agent and each of the Banks, upon request, full information
as to the insurance carried. In addition to the requirements of the immediately
preceding sentence, the Borrower will at all times cause insurance of the types
described in Schedule VIII to be maintained (with the same scope of coverage as
that described in Schedule VIII) at levels which are consistent with its
practices immediately before the Initial Borrowing Date, taking into account the
age and fair market value of equipment. Such insurance shall include physical
damage insurance on all real and personal property (whether now owned or
hereafter acquired) on an all risk basis and business interruption insurance.
The provisions of this Section 8.03 shall be deemed supplemental to, but not
duplicative of, the provisions of any Security Documents that require the
maintenance of insurance.
(b) The Borrower will, and will cause each of its Subsidiaries to, at
all times keep the respective property of the Borrower and its Subsidiaries
(except real or personal property leased or financed through third parties in
accordance with this Agreement) insured in favor of the Collateral Agent, and
all policies or certificates with re spect to such insurance (and any other
insurance maintained by, or on behalf of, the Borrower or any Subsidiary of the
Borrower) (i) shall be endorsed to the Collateral Agent's satisfaction for the
benefit of the Collateral Agent (including, without limitation, by naming the
Collateral Agent as certificate holder, mortgagee and loss payee with respect to
real property, certificate holder and loss payee with respect to personal
property, additional insured with respect to general liability and umbrella
liability coverage and certificate holder with respect to workers' compensation
insurance), (ii) shall state that such insurance poli cies shall not be
cancelled or materially changed without at least 30 days' prior written notice
thereof by the respective insurer to the Collateral Agent and (iii) shall be
deposited with the Collateral Agent.
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(c) If the Borrower or any of its Subsidiaries shall fail to maintain
all insur ance in accordance with this Section 8.03, or if the Borrower or any
of its Subsidiaries shall fail to so name the Collateral Agent as an additional
insured, mortgagee or loss payee, as the case may be, or so deposit all
certificates with respect thereto, the Agent and/or the Collateral Agent shall
have the right (but shall be under no obligation) to procure such insurance, and
the Credit Parties agree to jointly and severally reimburse the Agent or the
Collateral Agent, as the case may be, for all costs and expenses of procuring
such insurance.
8.04 Payment of Taxes. The Borrower will pay and discharge, and will
----------------
cause each of its Subsidiaries to pay and discharge, all taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits, or
upon any properties belonging to it, prior to the date on which penalties attach
thereto, and all lawful claims for sums that have become due and payable which,
if unpaid, might become a Lien not otherwise permitted under Section 9.03(a);
provided, that neither the Borrower nor any of its Subsidiaries shall be
--------
required to pay any such tax, assessment, charge, levy or claim which is being
contested in good faith and by proper proceedings if it has maintained adequate
reserves with respect thereto in accordance with GAAP.
8.05 Corporate Franchises. The Borrower will do, and will cause each
--------------------
of its Subsidiaries to do, or cause to be done, all things necessary to preserve
and keep in full force and effect its existence and its material rights,
franchises, authority to do business, licenses, certifications, accreditations
and patents, except for rights, franchises, authority to do business, licenses,
certifications, accreditations and patents the loss of which (individually and
in the aggregate) could not reasonably be expected to have a Material Adverse
Effect; provided, however, that any transaction permitted by Section 9.02 will
-------- -------
not constitute a breach of this Section 8.05.
8.06 Compliance with Statutes; etc. The Borrower will, and will
------------------------------
cause each of its Subsidiaries to, comply with all applicable statutes,
regulations and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property, except for such noncompliance as
would not have a Material Adverse Effect or a material adverse effect on the
ability of any Credit Party to perform its obligations under any Credit Document
to which it is a party.
8.07 Compliance with Environmental Laws. (a) (i) The Borrower will
----------------------------------
comply, and will cause each of its Subsidiaries to comply, in all material
respects with all Environmental Laws applicable to the ownership or use of its
Real Property now or here after owned or operated by the Borrower or any of its
Subsidiaries, will promptly pay or cause to be paid all costs and expenses
incurred in connection with such compliance, and will keep or cause to be kept
all such Real Property free and clear of any Liens imposed
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pursuant to such Environmental Laws and (ii) neither the Borrower nor any of its
Sub sidiaries will generate, use, treat, store, Release or dispose of, or permit
the generation, use, treatment, storage, release or disposal of, Hazardous
Materials on any Real Property owned or operated by the Borrower or any of its
Subsidiaries, or transport or permit the transportation of Hazardous Materials
to or from any such Real Property, unless the failure to comply with the
requirements specified in clause (i) or (ii) above, either individually or in
the aggregate, would not reasonably be expected to have a Material Adverse
Effect. If the Borrower or any of its Subsidiaries, or any tenant or occupant
of any Real Property owned or operated by the Borrower or any of its
Subsidiaries, cause or permit any intentional or unintentional act or omission
resulting in the presence or Release of any Hazardous Material (except in
compliance with applicable Environmental Laws), the Borrower agrees to
undertake, and/or to cause any of its Subsidiaries, tenants or occupants to
undertake, at their sole expense, any clean up, removal, remedial or other
action required pursuant to Environmental Laws to remove and clean up any
Hazardous Materials from any Real Property except where the failure to do so
would not reasonably be expected to have a Material Adverse Effect; provided
--------
that neither the Borrower nor any of its Subsidiaries shall be required to
comply with any such order or directive which is being contested in good faith
and by proper proceedings so long as it has maintained adequate reserves with
respect to such compliance to the extent required in accordance with GAAP.
(b) At the written request of the Agent or the Required Banks, which
request shall specify in reasonable detail the basis therefor, at any time and
from time to time, the Borrower will provide, at its sole cost and expense, an
environmental site assessment report concerning any Real Property now or
hereafter owned or operated by the Borrower or any of its Subsidiaries, prepared
by an environmental consulting firm approved by the Agent, addressing the
matters in clause (i), (ii) or (iii) below which gives rise to such request (or,
in the case of a request pursuant to following clause (i), addressing such
matter as may be requested by the Agent or the Required Banks) and estimating
the range of the potential costs of any removal, remedial or other corrective
action in connection with any such matter, provided that in no event shall such
request be made unless (i) an Event of Default has occurred and is continuing,
(ii) the Banks receive notice under Section 8.01(h) for any event for which
notice is required to be delivered for any such Real Property or (iii) the Agent
or the Required Banks reasonably believe that there was a breach of any
representation, warranty or covenant contained in Section 7.17 or 8.07(a). If
the Borrower fails to provide the same within 60 days after such request was
made, the Agent may order the same, and the Borrower shall grant and hereby
grants, to the Agent and the Banks and their agents access to such Real Property
and specifically grants, the Agent and the Banks and their agents an irrevocable
non-exclusive license, subject to the rights of ten ants, to undertake such an
assessment, all at the Borrower's expense.
8.08 ERISA. As soon as possible and, in any event, within ten days
-----
after the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate knows
or has reason
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to know of the occurrence of any of the following, the Borrower will deliver to
each of the Banks a certificate of the chief financial officer of the Borrower
setting forth the full details as to such occurrence and the action, if any,
that the Borrower, such Subsidiary or such ERISA Affiliate is required or
proposes to take, together with any notices required or proposed to be given to
or filed with or by the Borrower, the Subsidiary, the ERISA Affiliate, the PBGC,
a Plan participant or the Plan administrator with respect thereto: that a
Reportable Event has occurred (except to the extent that the Borrower has
previously delivered to the Banks a certificate and notices (if any) concerning
such event pursuant to the next clause hereof); that a contributing sponsor (as
defined in Section 4001(a)(13) of ERISA) of a Plan subject to Title IV of ERISA
is subject to the advance reporting requirement of PBGC Regulation Section
4043.61 (without regard to subparagraph (b)(1) thereof), and an event described
in subsection .62, .63, .64, .65, .66, .67 or .68 of PBGC Regulation Section
4043 is reasonably expected to occur within the following 30 days; that an
accumulated funding deficiency, within the meaning of Section 412 of the Code or
Section 302 of ERISA, has been incurred or an application may be or has been
made for a waiver or modification of the minimum funding standard (including any
required installment payments) or an extension of any amortization period under
Section 412 of the Code or Section 303 or 304 of ERISA with respect to a Plan;
that any contribution required to be made with respect to a Plan has not been
timely made; that a Plan has been or may be terminated, reorganized, partitioned
or declared insolvent under Title IV of ERISA; that a Plan has an Unfunded
Current Liability; that proceedings may be or have been instituted to terminate
or appoint a trustee to administer a Plan which is subject to Title IV of ERISA;
that a proceeding has been instituted pursuant to Section 515 of ERISA to
collect a delinquent contribution to a Plan; that the Borrower, any Subsidiary
of the Borrower or any ERISA Affiliate will or may incur any liability
(including any indirect, contingent, or secondary liability) to or on account of
the termination of or withdrawal from a Plan under Section 4062, 4063, 4064,
4069, 4201, 4204 or 4212 of ERISA or with respect to a Plan under Section
401(a)(29), 4971, 4975 or 4980 of the Code or Section 409 or 502(i) or 502(l) of
ERISA or with respect to a group health plan (as defined in Section 607(1) of
ERISA or Section 4980B(g)(2) of the Code) under Section 4980B of the Code; or
that the Borrower or any Subsidiary of the Borrower may incur any material
liability pursuant to any employee welfare benefit plan (as defined in Section
3(1) of ERISA) that provides benefits to retired employees or other former
employees (other than as required by Section 601 of ERISA) or any Plan. The
Borrower will deliver to each of the Banks (i) a complete copy of the annual
report (on Internal Revenue Service Form 5500-series) of each Plan (including,
to the extent required, the related financial and actuarial statements and
opinions and other supporting statements, certifications, schedules and
information) required to be filed with the Internal Revenue Service and (ii)
copies of any records, documents or other information that must be furnished to
the PBGC with respect to any Plan pursuant to Section 4010 of ERISA. In
addition to any certificates or notices delivered to the Banks pursuant to the
first sentence hereof, copies of annual reports and any records, documents or
other information required to be furnished to the PBGC, and any material notices
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received by the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate
with respect to any Plan shall be delivered to the Banks no later than ten days
after the date such report has been filed with the Internal Revenue Service or
such records, documents and/or information has been furnished to the PBGC or
such notice has been received by the Borrower, such Subsidiary or such ERISA
Affiliate, as applicable.
8.09 Good Repair. The Borrower will, and will cause each of its
-----------
Subsidi aries to, ensure that its material properties and equipment used in its
business are kept in good repair, working order and condition, ordinary wear and
tear excepted, and that from time to time there are made in such properties and
equipment all needful and proper repairs, renewals, replacements, extensions,
additions, betterments and improvements thereto, to the extent and in the manner
useful or customary for companies in similar businesses.
8.10 End of Fiscal Years; Fiscal Quarters. The Borrower will, for
------------------------------------
financial reporting purposes, cause (i) each of its, and each of its
Subsidiaries', fiscal years to end on December 31 of each year and (ii) each of
its, and each of its Subsidiaries', fiscal quarters to end on March 31, June 30,
September 30 and December 31 of each year.
8.11 Additional Security; Further Assurances. (a) The Borrower
---------------------------------------
will, and will cause each of its Domestic Subsidiaries (and to the extent
Section 8.12 is operative, each of its Foreign Subsidiaries) to, grant to the
Collateral Agent security interests and mortgages in such assets and real
property of the Borrower and its Subsidiaries as are not covered by the original
Security Documents, and as may be requested from time to time by the Agent or
the Required Banks (collectively, the "Additional Security Documents"). All
such security interests and mortgages shall be granted pursuant to documentation
rea sonably satisfactory in form and substance to the Agent and shall constitute
valid and enforceable perfected security interests and mortgages superior to and
prior to the rights of all third Persons and subject to no other Liens except
for Permitted Liens. The Additional Security Documents or instruments related
thereto shall have been duly recorded or filed in such manner and in such places
as are required by law to establish, perfect, preserve and protect the Liens in
favor of the Collateral Agent required to be granted pursuant to the Additional
Security Documents and all taxes, fees and other charges payable in connection
therewith shall have been paid in full.
(b) The Borrower will, and will cause each of its Subsidiaries to, at
the expense of the Borrower, make, execute, endorse, acknowledge, file and/or
deliver to the Collateral Agent from time to time such vouchers, invoices,
schedules, confirmatory assign ments, conveyances, financing statements,
transfer endorsements, powers of attorney, certi ficates, real property surveys,
reports and other assurances or instruments and take such further steps relating
to the Collateral covered by any of the Security Documents as the Collateral
Agent may reasonably require (including, without limitation, reregistering the
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certificate of title of any mobile Healthcare Unit in any state in which such
Healthcare Unit primarily operates, to the extent the Collateral Agent
determines, in its reasonable discretion, that such action is required to ensure
the perfection of its security interest in such Collateral). Furthermore, the
Borrower shall cause to be delivered to the Collateral Agent such opinions of
counsel, title insurance and other related documents as may be reasonably
requested by the Agent to assure themselves that this Section 8.11 has been
complied with.
(c) Each of the Credit Parties agrees that each action required above
by this Section 8.11 shall be completed as soon as possible, but in no event
later than 90 days after such action is either requested to be taken by the
Agent or the Required Banks or required to be taken by the Borrower and its
Subsidiaries pursuant to the terms of this Section 8.11.
8.12 Foreign Subsidiaries Security. If following a change in the
-----------------------------
relevant sections of the Code or the regulations, rules, rulings, notices or
other official pronounce ments issued or promulgated thereunder, counsel for the
Borrower reasonably acceptable to the Agent does not within 30 days after a
request from the Agent or the Required Banks deliver evidence, in form and
substance mutually satisfactory to the Agent and the Borrower, with respect to
any Foreign Subsidiary of the Borrower which has not already had all of its
stock pledged pursuant to the Pledge Agreement that (i) a pledge of 66-2/3% or
more of the total combined voting power of all classes of capital stock of such
Foreign Subsidiary entitled to vote, (ii) the entering into by such Foreign
Subsidiary of a security agreement in substantially the form of the Security
Agreement and (iii) the entering into by such Foreign Subsidiary of a guaranty
in substantially the form of the Subsidiaries Guar anty, in any such case could
reasonably be expected to cause (I) the undistributed earnings of such Foreign
Subsidiary as determined for Federal income tax purposes to be treated as a
deemed dividend to such Foreign Subsidiary's United States parent for Federal
income tax purposes or (II) other material adverse Federal income tax
consequences to the Credit Parties, then in the case of a failure to deliver the
evidence described in clause (i) above, that portion of such Foreign
Subsidiary's outstanding capital stock so issued by such Foreign Subsidiary, in
each case not theretofore pledged pursuant to the Pledge Agreement shall be
pledged to the Collateral Agent for the benefit of the Secured Creditors
pursuant to the Pledge Agreement (or another pledge agreement in substantially
similar form, if needed), and in the case of a failure to deliver the evidence
described in clause (ii) above, such Foreign Subsidiary shall execute and
deliver the Security Agreement (or another security agreement in substantially
similar form, if needed), granting the Secured Creditors a security interest in
all of such Foreign Subsidiary's assets and securing the Obligations of the
Borrower under the Credit Documents and under any Interest Rate Protection Agree
ment or Other Hedging Agreement and, in the event the Subsidiaries Guaranty
shall have been executed by such Foreign Subsidiary, the obligations of such
Foreign Subsidiary there under, and in the case of a failure to deliver the
evidence described in clause (iii) above, such Foreign Subsidiary shall execute
and deliver the Subsidiaries Guaranty (or another
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guaranty in substantially similar form, if needed), guaranteeing the Obligations
of the Borrower under the Credit Documents and under any Interest Rate
Protection Agreement or Other Hedging Agreement, in each case to the extent that
the entering into of such Security Agreement or Subsidiaries Guaranty is
permitted by the laws of the respective foreign jurisdiction and with all
documents delivered pursuant to this Section 8.12 to be in form and substance
reasonably satisfactory to the Agent.
8.13 Ownership of Subsidiaries. Except to the extent expressly
-------------------------
permitted herein or as otherwise expressly consented in writing by the Required
Banks, each Credit Party shall directly or indirectly own 100% of the capital
stock or other equity interests of each of their respective Subsidiaries.
8.14 Permitted Acquisitions. (a) Subject to the provisions of this
----------------------
Section 8.14 and the requirements contained in the definition of Permitted
Acquisition, the Borrower and any of its Wholly-Owned Subsidiaries may from time
to time effect Permitted Acquisitions, so long as (in each case except to the
extent the Required Banks otherwise specifically agree in writing in the case of
a specific Permitted Acquisition): (i) no Default or Event of Default shall be
in existence at the time of the consummation of the proposed Permitted
Acquisition or immediately after giving effect thereto; (ii) the Borrower shall
have given the Agent and the Banks at least 5 Business Days' prior written
notice of any Permitted Acquisition; (iii) calculations are made by the Borrower
of compliance with the covenants contained in Sections 9.08, 9.09, 9.10 and 9.11
(in the case of Section 9.11, giving effect to the last sentence appearing
therein) for the period of four (except in the case of any determination of
Consolidated EBITDA for purposes of such Sections, which shall be measured on a
two-quarter annualized basis as provided in the definition thereof) consecutive
fiscal quarters (taken as one accounting period) most recently ended prior to
the date of such Permitted Acquisition (each, a "Calculation Period"), on a Pro
---
Forma Basis as if the respective Permitted Acquisition (as well as all other
-----
Permitted Acquisitions theretofore consummated after the first day of such
Calculation Period) had occurred on the first day of such Calculation Period,
and such recalculations shall show that such financial covenants would have been
complied with if the Permitted Acquisition had occurred on the first day of such
Calculation Period (for this purpose, if the first day of the respective
Calculation Period occurs prior to the Initial Borrowing Date, calculated as if
the covenants contained in said Sections 9.08, 9.09, 9.10 and 9.11 (in the case
of Section 9.11, giving effect to the last sentence appearing therein) had been
applicable from the first day of the Calculation Period); (iv) based on good
faith projections prepared by the Borrower for the period from the date of the
consummation of the Permitted Acquisition to the date which is one year
thereafter, the level of financial performance measured by the covenants set
forth in Sections 9.08, 9.09, 9.10 and 9.11 (in the case of Section 9.11, giving
effect to the last sentence appearing therein) shall be better than or equal to
such level as would be required to provide that no Default or Event of Default
would exist under the financial covenants contained in Sections 9.08, 9.09, 9.10
and 9.11 (in the case of Section 9.11,
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giving effect to the last sentence appearing therein) of this Agreement as
compliance with such covenants would be required through the date which is one
year from the date of the consummation of the respective Permitted Acquisition;
(v) calculations are made by the Borrower demonstrating compliance with an
Adjusted Senior Leverage Ratio not to exceed 3.0:1.0 on the last day of the
relevant Calculation Period, on a Pro Forma Basis as if the respective Permitted
--- -----
Acquisition (as well as all other Permitted Acquisitions theretofore consummated
after the first day of such Calculation Period) had occurred on the first day of
such Calculation Period; (vi) all representations and warranties contained
herein and in the other Credit Documents shall be true and correct in all
material respects with the same effect as though such representations and
warranties had been made on and as of the date of such Permitted Acquisition
(both before and after giving effect thereto), unless stated to relate to a
specific earlier date, in which case such representations and warranties shall
be true and correct in all material respects as of such earlier date; (vii) the
Borrower provides to the Agent and the Banks as soon as available but not later
than 5 Business Days after the execution thereof, a copy of any executed
purchase agreement or similar agreement with respect to such Permitted
Acquisition; (viii) after giving effect to each Permitted Acquisition (and the
payment of all post-closing purchase price adjustments required (in the good
faith determination of the Borrower) in connection therewith and all capital
expenditures (and the financing thereof) reasonably anticipated by the Borrower
to be made in the business acquired pursuant to such Permitted Acquisition
within 90 days following such Permitted Acquisition), the Total Unutilized
Revolving Loan Commitment shall equal or exceed $10,000,000; and (ix) the
Borrower shall have delivered to the Agent an officer's certificate executed by
an Authorized Officer of the Borrower, certifying to the best of his knowledge,
compliance with the requirements of preceding clauses (i) through (vi),
inclusive, and (viii) and containing the calculations required by the preceding
clauses (iii), (iv), (v) and (viii).
(b) At the time of each Permitted Acquisition involving the creation
or acquisition of a Subsidiary, or the acquisition of capital stock or other
equity interest of any Person, all capital stock or other equity interests
thereof created or acquired in connection with such Permitted Acquisition shall
be pledged for the benefit of the Secured Creditors pursuant to the Pledge
Agreement in accordance with the requirements of Section 9.15.
(c) The Borrower shall cause each Subsidiary which is formed to
effect, or is acquired pursuant to, a Permitted Acquisition to comply with, and
to execute and deliver, all of the documentation required by, Sections 8.11 and
9.15, to the satisfaction of the Agent.
(d) The consummation of each Permitted Acquisition shall be deemed to
be a representation and warranty by the Borrower that the certifications by the
Borrower (or by one or more of its Authorized Officers) pursuant to Section
8.14(a) are true and correct and that all conditions thereto have been satisfied
and that same is permitted in accordance with the terms of this Agreement, which
representation and warranty shall be deemed to
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be a representation and warranty for all purposes hereunder, including, without
limitation, Sections 6 and 10.
8.15 Maintenance of Company Separateness. The Borrower will, and
-----------------------------------
will cause each of its Subsidiaries to, satisfy customary Company formalities,
including, as applicable, the holding of regular board of directors' and
shareholders' meetings or action by directors or shareholders without a meeting
and the maintenance of Company offices and records. Neither the Borrower nor
any of its Subsidiaries shall take any action, or conduct its affairs in a
manner, which is likely to result in the Company existence of the Borrower or
any of its Subsidiaries being ignored, or in the assets and liabilities of the
Borrower or any of its Subsidiaries being substantively consolidated with those
of any other such Person in a bankruptcy, reorganization or other insolvency
proceeding.
8.16 Performance of Obligations. The Borrower will, and will cause
--------------------------
each of its Subsidiaries to, perform all of its obligations under the terms of
each mortgage, deed of trust, indenture, loan agreement or credit agreement and
each other material agreement, contract or instrument by which it is bound,
except such non-performances as could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
8.17 Use of Proceeds. All proceeds of the Loans shall be used as
---------------
provided in Section 7.05.
SECTION 9. Negative Covenants. The Borrower hereby covenants and
------------------
agrees that as of the Effective Date and thereafter for so long as this
Agreement is in effect and until the Total Commitment has terminated, no Letters
of Credit or Notes are outstanding and the Loans, together with interest, Fees
and all other Obligations (other than any indemnities described in Section 13.13
which are not then due and payable) incurred hereunder, are paid in full:
9.01 Changes in Business. The Borrower and its Subsidiaries will not
-------------------
engage in any business other than a Permitted Business.
9.02 Consolidation; Merger; Sale or Purchase of Assets; etc. The
-------------------------------------------------------
Borrower will not, and will not permit any of its Subsidiaries to, wind up,
liquidate or dis solve its affairs or enter into any transaction of merger or
consolidation, or convey, sell, lease or otherwise dispose of all or any part of
its property or assets (other than inventory in the ordinary course of
business), or enter into any sale-leaseback transactions, or pur chase or
otherwise acquire (in one or a series of related transactions) any part of the
prop erty or assets (other than purchases or other acquisitions of inventory,
materials, general intangibles and equipment in the ordinary course of business)
of any Person or agree to do any of the foregoing at any future time, except
that the following shall be permitted:
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(a) the Borrower and its Subsidiaries may, as lessee, enter into
operating leases in the ordinary course of business with respect to real or
personal property;
(b) Capital Expenditures (including payments in respect of
Capitalized Lease Obligations entered into after the Initial Borrowing
Date, but excluding Capital Expenditures which may arise as a result of the
purchase of any capital stock or equity interests in any other Person or by
means of a purchase of assets constituting a business, division or product
line of any Person, which expenditures may only be made pursuant to
Permitted Acquisitions effected in accordance with the relevant provisions
of this Agreement) by the Borrower and its Subsidiaries shall be permitted
so long as same do not cause a violation of any of the other provisions of
this Agreement;
(c) Investments permitted pursuant to Section 9.05 and the
liquidation of Cash Equivalents in the ordinary course of business;
(d) the Borrower and any of its Subsidiaries may sell or otherwise
dispose of assets (excluding capital stock of, or other equity interests
in, Subsidiaries and Healthcare Units) which, in the reasonable opinion of
such Person, are obsolete, uneconomic or no longer useful in the conduct of
such Person's business, provided that except with respect to asset
--------
dispositions or transfers arising out of, or in connection with, the events
described in clauses (i) and (ii) of the definition of Recovery Event, (w)
each such sale or disposition shall be for an amount at least equal to the
fair market value thereof (as determined in good faith by senior management
of the Borrower), (x) each such sale or disposition (I) results in
consideration at least 80% of which (taking the amount of cash, the
principal amount of any promissory notes and the fair market value, as
determined by the Borrower in good faith, of any other consideration) shall
be in the form of cash or (II) results in the assumption of all of the
Capitalized Lease Obligations of the Borrower or such Subsidiary in respect
of such asset by the purchaser thereof, (y) the aggregate Net Sale Proceeds
from all assets sold or otherwise disposed of pursuant to this clause (d),
when added to the aggregate amount of all Capitalized Lease Obligations
assigned in connection with all assets sold or otherwise disposed of
pursuant to this clause (d), shall not exceed $2,500,000 in the aggregate
in any fiscal year of the Borrower and (z) the Net Sale Proceeds therefrom
are either applied to repay Term Loans (or reduce the Total Revolving Loan
Commitment) as provided in Section 4.02(c) or reinvested in replacement
assets or retained to the extent permitted by Section 4.02(c) and/or the
other relevant provisions of this Agreement;
(e) any Subsidiary of the Borrower may transfer assets to the
Borrower or to any other Wholly-Owned Subsidiary of the Borrower, so long
as any security
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interests granted to the Collateral Agent for the benefit of the Secured
Creditors pursuant to the Security Documents in the assets so transferred
shall remain in full force and effect and perfected (to at least the same
extent as in effect immediately prior to such transfer);
(f) any Subsidiary of the Borrower may merge with and into, or be
dissolved or liquidated into, the Borrower, so long as (i) the Borrower is
the surviving corporation of any such merger, dissolution or liquidation
and (ii) any security interests granted to the Collateral Agent for the
benefit of the Secured Creditors pursuant to the Security Documents in the
assets of such Subsidiary shall remain in full force and effect and
perfected (to at least the same extent as in effect immediately prior to
such merger, dissolution or liquidation);
(g) any Subsidiary of the Borrower may merge with and into, or be
dissolved or liquidated into, any Wholly-Owned Domestic Subsidiary of the
Borrower, so long as (i) such Wholly-Owned Domestic Subsidiary is the
surviving corporation of any such merger, dissolution or liquidation and
(ii) any security interests granted to the Collateral Agent for the benefit
of the Secured Creditors pursuant to the Security Documents in the assets
of such Subsidiary shall remain in full force and effect and perfected (to
at least the same extent as in effect immedi ately prior to such merger,
dissolution or liquidation);
(h) the Borrower shall be permitted to make Permitted Acquisitions,
so long as such Permitted Acquisitions are effected in accordance with the
requirements of Section 8.14;
(i) the Recapitalization shall be permitted in accordance with the
requirements of this Agreement;
(j) the Borrower and its Subsidiaries may, in the ordinary course of
business, license patents, trademarks, copyrights and know-how to or from
third Persons or one another, so long as each such license is permitted to
be assigned pursuant to the Security Agreement (to the extent that a
security interest in such patents, trademarks, copyrights and know-how is
granted thereunder) and does not otherwise prohibit the granting of a Lien
by the Borrower or any of its Subsidiaries pursuant to the Security
Agreement in the intellectual property covered by such license;
(k) the Borrower or any of its Subsidiaries may effect Permitted
Sale-Leaseback Transactions in accordance with the definition thereof;
provided that the aggregate amount of all proceeds received by the Borrower
--------
and its Subsidiaries
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from all Permitted Sale-Leaseback Transactions consummated on and after the
Effective Date shall not exceed $15,000,000;
(l) the Borrower and any of its Subsidiaries may sell Healthcare
Units which, in the reasonable opinion of such Person, are obsolete,
uneconomic or no longer useful in the conduct of such Person's business or
otherwise require upgrading, provided that (i) any such sale shall be for
--------
an amount at least equal to the fair market value thereof (as determined in
good faith by senior management of the Borrower), (ii) such sale (x)
results in consideration at least 80% of which (taking the amount of cash,
the principal amount of any promissory notes and the fair market value, as
determined by the Borrower in good faith, of any other consideration) shall
be in the form of cash or (y) results in the assumption of all of the
Capitalized Lease Obligations of the Borrower or such Subsidiary in respect
of such Healthcare Unit by the purchaser thereof, (iii) the Net Sale
Proceeds from, or the amount of Capitalized Lease Obligations assigned in
connection with, any such sale, when added to the aggregate Net Sale
Proceeds received from, and the aggregate amount of all Capitalized Lease
Obligations assigned in connection with, all other Healthcare Units sold
pursuant to this clause (l) after the Effective Date, shall not exceed
$25,000,000 and (iv) any Net Sale Proceeds from any such sale are applied
to repay Term Loans (or reduce the Total Revolving Loan Commitment) as
provided in Section 4.02(c) or reinvested in replacement assets or retained
to the extent permitted by Section 4.02(c) and/or the other relevant
provisions of this Agreement;
(m) the Borrower and any of its Subsidiaries may effect Healthcare
Unit Replacements, provided that (i) any disposition of a Healthcare Unit
--------
pursuant to a Healthcare Unit Replacement shall be for an amount (including
any credits towards the purchase of a replacement mobile Healthcare Unit)
at least equal to the fair market value thereof (as determined in good
faith by senior management of the Borrower) and (ii) the Net Sale Proceeds
from any such disposition are applied to repay Term Loans (or reduce the
Total Revolving Loan Commitment) as provided in Section 4.02(c) or
reinvested in replacement Healthcare Units or retained to the extent
permitted by Section 4.02(c); and
(n) the Borrower and any of its Subsidiaries may sell or otherwise
dispose of the capital stock of, or other equity interests in, any of their
respective Subsidiaries and Joint Ventures which, in the reasonable opinion
of such Person, are uneconomic or no longer useful in the conduct of such
Person's business, provided that (w) each such sale or disposition shall be
--------
for an amount at least equal to the fair market value thereof (as
determined in good faith by senior management of the Borrower), (x) each
such sale results in consideration at least 80% of which (taking the amount
of cash, the principal amount of any promissory notes and the
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fair market value, as determined by the Borrower in good faith, of any
other consideration) shall be in the form of cash, (y) the aggregate Net
Sale Proceeds of all assets sold or otherwise disposed of pursuant to this
clause (n) after the Effective Date shall not exceed $15,000,000 in the
aggregate and (z) the Net Sale Proceeds therefrom are either applied to
repay Term Loans (or reduce the Total Revolving Loan Commitment) as
provided in Section 4.02(c) or reinvested in replacement assets or retained
to the extent permitted by Section 4.02(c) and/or the other relevant
provisions of this Agreement.
To the extent the Required Banks waive the provisions of this Section 9.02 with
respect to the sale or other disposition of any Collateral, or any Collateral is
sold or otherwise dis posed of as permitted by this Section 9.02, such
Collateral (unless transferred to the Borrower or a Subsidiary thereof) shall be
sold or otherwise disposed of free and clear of the Liens created by the
Security Documents and the Agent shall take such actions (including, without
limitation, directing the Collateral Agent to take such actions) as are
appropriate in connection therewith.
9.03 Liens. The Borrower will not, and will not permit any of its
-----
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets of any kind (real or personal, tangible or
intangible) of the Borrower or any of its Subsidiaries, whether now owned or
hereafter acquired, or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
or assets (including sales of accounts receivable or notes with recourse to the
Borrower or any of its Subsidiaries) or assign any right to receive income,
except for the following (collectively, the "Permitted Liens"):
(a) inchoate Liens for taxes, assessments or governmental charges or
levies not yet due and payable or Liens for taxes, assessments or
governmental charges or levies being contested in good faith and by
appropriate proceedings for which adequate reserves have been established
in accordance with GAAP;
(b) Liens in respect of property or assets of the Borrower or any of
its Subsidiaries imposed by law which were incurred in the ordinary course
of business and which have not arisen to secure Indebtedness for borrowed
money, such as carriers', warehousemen's and mechanics' Liens, statutory
landlord's Liens, and other similar Liens arising in the ordinary course of
business, and which either (x) do not in the aggregate materially detract
from the value of such property or assets or materially impair the use
thereof in the operation of the business of the Borrower or any of its
Subsidiaries or (y) are being contested in good faith by appropriate
proceedings, which proceedings have the effect of preventing the forfeiture
or sale of the property or asset subject to such Lien;
-73-
(c) Liens created by or pursuant to this Agreement and the Security
Documents;
(d) Liens in existence on the Initial Borrowing Date which are
listed, and the property subject thereto described, in Schedule IX, without
giving effect to any extensions or renewals thereof;
(e) Liens arising from judgments, decrees or attachments in
circumstances not constituting an Event of Default under Section 10.09,
provided that the amount of cash and property (determined on a fair market
--------
value basis) deposited or delivered to secure the respective judgment or
decree or subject to attachment shall not exceed $2,500,000 at any time;
(f) Liens (other than any Lien imposed by ERISA) (x) incurred or
deposits made in the ordinary course of business of the Borrower and its
Subsidiaries in connection with workers' compensation, unemployment
insurance and other types of social security, (y) to secure the performance
by the Borrower and its Subsidiaries of tenders, statutory obligations
(other than excise taxes), surety, stay, customs and appeal bonds,
statutory bonds, bids, leases, government contracts, trade contracts,
performance and return of money bonds and other similar obligations
(exclusive of obligations for the payment of borrowed money) or (z) to
secure the performance by the Borrower and its Subsidiaries of leases of
Real Property, to the extent incurred or made in the ordinary course of
business consistent with past practices, provided that the aggregate amount
--------
of deposits at any time pursuant to sub-clause (y) and sub-clause (z) shall
not exceed $4,000,000 in the aggregate;
(g) licenses, sublicenses, leases or subleases granted to third
Persons in the ordinary course of business not interfering in any material
respect with the business of the Borrower or any of its Subsidiaries;
(h) easements, rights-of-way, restrictions, minor defects or
irregularities in title and other similar charges or encumbrances, in each
case not securing Indebtedness and not interfering in any material respect
with the ordinary conduct of the business of the Borrower or any of its
Subsidiaries;
(i) Liens arising from precautionary UCC financing statements
regarding operating leases;
(j) Liens created pursuant to Capital Leases permitted pursuant to
Section 9.04(d), provided that (x) such Liens only serve to secure the
--------
payment of Indebtedness arising under such Capitalized Lease Obligation
(and other
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Indebtedness permitted by Section 9.04(d) and incurred from the same Person
as such Indebtedness) and (y) the Lien encumbering the asset giving rise to
the Capitalized Lease Obligation does not encumber any other asset of the
Borrower or any of its Subsidiaries (other than other assets subject to
Capitalized Lease Obligations and/or Indebtedness incurred pursuant to
Section 9.04(d), in each case owing to the same Person as such Capitalized
Lease Obligation);
(k) Permitted Encumbrances;
(l) Liens arising pursuant to purchase money mortgages or security
interests securing Indebtedness representing the purchase price (or
financing of the purchase price within 90 days after the respective
purchase) of assets acquired after the Initial Borrowing Date, provided
--------
that (i) any such Liens attach only to the assets so pur chased, upgrades
thereon and, if the asset so purchased is an upgrade, the original asset
itself (and such other assets financed by the same financing source), (ii)
the Indebtedness (other than Indebtedness incurred from the same financing
source to purchase other assets and excluding Indebtedness representing
obligations to pay installation and delivery charges for the property so
purchased) secured by any such Lien does not exceed 100%, nor is less than
80%, of the lesser of the fair market value or the purchase price of the
property being purchased at the time of the incurrence of such Indebtedness
and (iii) the Indebtedness secured thereby is permitted to be incurred
pursuant to Section 9.04(d); and
(m) Liens on property or assets acquired pursuant to a Permitted
Acquisi tion, or on property or assets of a Subsidiary of the Borrower in
existence at the time such Subsidiary is acquired pursuant to a Permitted
Acquisition, provided that (i) any Indebtedness that is secured by such
--------
Liens is permitted to exist under Section 9.04(d), and (ii) such Liens are
not incurred in connection with, or in contemplation or anticipation of,
such Permitted Acquisition and do not attach to any other asset of the
Borrower or any of its Subsidiaries.
9.04 Indebtedness. The Borrower will not, and will not permit any of
------------
its Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement and the other
Credit Documents;
(b) Existing Indebtedness outstanding on the Initial Borrowing Date
and listed on Schedule IV (as reduced by any repayments thereof after the
Initial Borrowing Date), without giving effect to any subsequent extension,
renewal or refinancing thereof;
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(c) Indebtedness under Interest Rate Protection Agreements entered
into to protect the Borrower against fluctuations in interest rates in
respect of the Obligations otherwise permitted under this Agreement;
(d) (x) Indebtedness of a Subsidiary acquired pursuant to a Permitted
Acquisition (or Indebtedness assumed at the time of a Permitted Acquisition
of an asset securing such Indebtedness) (the "Permitted Acquired Debt"), so
long as (i) such Indebtedness was not incurred in connection with, or in
anticipation or contemplation of, such Permitted Acquisition and (ii) such
Indebtedness does not constitute debt for borrowed money (except to the
extent such Indebtedness cannot be repaid in accordance with its terms at
the time of its assumption pursuant to such Permitted Acquisition and the
aggregate principal amount of all such Indebtedness for borrowed money
permitted pursuant to this parenthetical does not exceed $[_________]), it
being understood and agreed that Capitalized Lease Obligations and purchase
money Indebtedness shall not constitute debt for borrowed money for
purposes of this clause (ii) and (y) Capitalized Lease Obligations and
Indebtedness of the Borrower and its Subsidiaries representing purchase
money Indebtedness secured by Liens permitted pursuant to Section 9.03(l),
provided, that the sum of (I) the aggregate principal amount of all
--------
Permitted Acquired Debt at any time outstanding plus (II) the aggregate
----
outstanding amount of Capitalized Lease Obligations incurred on and after
the Effective Date (including Indebtedness evidenced by Capitalized Lease
Obligations arising from Permitted Sale-Leaseback Transactions) plus (III)
----
the aggregate outstanding principal amount of all such purchase money
Indebtedness incurred on and after the Effective Date, shall not exceed
$30,000,000;
(e) Indebtedness constituting Intercompany Loans to the extent
permitted by Section 9.05(f);
(f) Permitted Subordinated Refinancing Indebtedness, so long as no
Default or Event of Default is in existence at the time of any incurrence
thereof and immediately after giving effect thereto;
(g) unsecured Indebtedness of the Borrower and the Subsidiary
Guarantors incurred under the Senior Subordinated Notes and the other
Senior Subordinated Note Documents in an aggregate principal amount not to
exceed $165,000,000 less the amount of any repayments of principal thereof
after the Effective Date;
(h) Indebtedness of the Borrower or any of its Subsidiaries which may
be deemed to exist in connection with agreements providing for
indemnification, pur chase price adjustments and similar obligations in
connection with acquisitions or sales of assets and/or businesses effected
in accordance with the requirements of this
-76-
Agreement (so long as any such obligations are those of the Person making
the respective acquisition or sale, and are not guaranteed by any other
Person);
(i) Contingent Obligations of (x) the Borrower or any of its
Subsidiaries as a guarantor of the lessee under any lease pursuant to which
the Borrower or any of its Wholly-Owned Subsidiaries is the lessee so long
as such lease is otherwise permitted hereunder and (y) the Borrower or any
of its Subsidiaries as a guarantor of any Capitalized Lease Obligation to
which a Joint Venture is a party or any contract entered into by such Joint
Venture in the ordinary course of business; provided that the maximum
liability of the Borrower or any of its Subsidiaries in respect of any
obligations as described pursuant to preceding clause (y) is permitted as
an Investment on such date pursuant to the requirements of Section 9.05(l);
and
(j) Permitted Subordinated Indebtedness incurred in accordance with
the requirements of the definition thereof and additional unsecured
Indebtedness of the Borrower and its Subsidiaries not otherwise permitted
pursuant to this Section 9.04, so long as the aggregate principal amount of
all Indebtedness permitted by this clause (j), when added to the aggregate
liquidation preference for all Disqualified Preferred Stock issued after
the Effective Date pursuant to Section 9.13(c), does not exceed $15,000,000
at any time outstanding.
9.05 Advances; Investments; Loans. The Borrower will not, and will
----------------------------
not permit any of its Subsidiaries to, lend money or extend credit or make
advances to any Person, or purchase or acquire any stock, obligations or
securities of, or any other interest in, or make any capital contribution to,
any Person, or purchase or own a futures contract or otherwise become liable for
the purchase or sale of currency or other commodities at a future date in the
nature of a futures contract, or hold any cash or Cash Equivalents (any of the
foregoing, an "Investment"), except:
(a) the Borrower and its Subsidiaries may invest in cash and Cash
Equivalents, provided that during any time that Revolving Loans or
--------
Swingline Loans are outstanding the aggregate amount of cash and Cash
Equivalents held by the Borrower and its Subsidiaries shall not exceed
$5,000,000 for any period of three consecutive Business Days;
(b) the Borrower and its Subsidiaries may acquire and hold
receivables owing to it, if created or acquired in the ordinary course of
business and payable or dischargeable in accordance with customary trade
terms (including the dating of receivables) of the Borrower or such
Subsidiary;
(c) the Borrower and its Subsidiaries may acquire and own investments
(including debt obligations and equity securities) received in connection
with the
-77-
bankruptcy or reorganization of suppliers and customers and in settlement
of delinquent obligations of, and other disputes with, customers and
suppliers arising in the ordinary course of business;
(d) Interest Rate Protection Agreements entered into in compliance
with Section 9.04(c) shall be permitted;
(e) advances, loans and investments in existence on the Initial
Borrowing Date and listed on Schedule VI shall be permitted, without giving
effect to any additions thereto or replacements thereof;
(f) the Borrower may make intercompany loans and advances to any
Subsidiary Guarantor, and any Subsidiary Guarantor may make intercompany
loans and advances to the Borrower or any other Subsidiary Guarantor
(collectively, "Intercompany Loans"), provided, that (x) each Intercompany
--------
Loan shall be evidenced by an Intercompany Note and (y) each such
Intercompany Note shall be pledged to the Collateral Agent pursuant to the
Pledge Agreement;
(g) loans and advances by the Borrower and its Subsidiaries to
employees of the Borrower and its Subsidiaries in connection with
relocations, purchases by such employees of Borrower Common Stock or
options or similar rights to purchase Borrower Common Stock and other
ordinary course of business purposes shall be permitted, so long as the
aggregate principal amount thereof at any time outstanding (determined
without regard to any write-downs or write-offs of such loans and advances)
shall not exceed $2,500,000;
(h) the Borrower may acquire and hold obligations of one or more
officers or other employees of the Borrower or its Subsidiaries in
connection with such officers' or employees' acquisition of shares of
Borrower Common Stock, so long as no cash is actually advanced by the
Borrower or any of its Subsidiaries to such officers or employees in
connection with the acquisition of any such obligations;
(i) the Recapitalization shall be permitted;
(j) the Borrower may make Permitted Acquisitions in accordance with
the relevant requirements of Section 8.14 and the component definitions as
used therein;
(k) the Borrower and its Subsidiaries may own the capital stock of
their respective Subsidiaries created or acquired in accordance with the
terms of this Agreement;
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(l) so long as no Default or Event of Default exists or would exist
immedi ately after giving effect to the respective Investment, the Borrower
shall be permitted to make Investments in any Joint Venture on any date in
an amount not to exceed the Available JV Basket Amount on such date (after
giving effect to all prior and contemporaneous adjustments thereto, except
as a result of such Investment), it being understood and agreed that (i)
any such Investment may be in the form of a contribution of a Healthcare
Unit or Units to such Joint Venture and (ii) to the extent the Borrower or
one or more other Credit Parties (after the respective Investment has been
made) receives a cash return from the respective Joint Venture of amounts
previously invested pursuant to this clause (l) (which cash return may be
made by way of repayment of principal in the case of loans and cash equity
returns (whether as a distribution, dividend or redemption) in the case of
equity investments), then the amount of such return of investment shall,
upon the Agent's receipt of a certification of the amount of the return of
investment from an Authorized Officer, apply to increase the Available JV
Basket Amount, provided that the aggregate amount of increases to the
--------
Available JV Basket Amount described above shall not exceed the amount of
returned investment and, in no event, shall the amount of the increases
made to the Available JV Basket Amount in respect of any Investment exceed
the amount previously invested pursuant to this clause (l); and
(m) in addition to investments permitted by clauses (a) through (l)
of this Section 9.05, the Borrower and its Subsidiaries may make additional
loans, advan ces and investments to or in a Person not an Affiliate in an
aggregate amount for all loans, advances and investments made pursuant to
this clause (m) (determined without regard to any write-downs or write-offs
thereof), net of cash repayments of principal in the case of loans and cash
equity returns (whether as a distribution, dividend, redemption or sale) in
the case of equity investments, not to exceed $10,000,000.
9.06 Dividends; etc. The Borrower will not, and will not permit any
---------------
of its Subsidiaries to, declare or pay any dividends (other than dividends
payable solely in com mon stock of the Borrower or any such Subsidiary, as the
case may be) or return any capi tal to, its stockholders or authorize or make
any other distribution, payment or delivery of property or cash to its
stockholders as such, or redeem, retire, purchase or otherwise acquire, directly
or indirectly, for a consideration, any shares of any class of its capital
stock, now or hereafter outstanding (or any warrants for or options or stock
appreciation rights in respect of any of such shares), or set aside any funds
for any of the foregoing pur poses, and the Borrower will not permit any of its
Subsidiaries to purchase or otherwise acquire for consideration any shares of
any class of the capital stock of the Borrower or any other Subsidiary, as the
case may be, now or hereafter outstanding (or any options or warrants or stock
appreciation rights issued by such Person with respect to its capital stock)
(all of the foregoing "Dividends"), except that:
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(i) any Subsidiary of the Borrower may pay Dividends to the
Borrower or any Wholly-Owned Subsidiary of the Borrower;
(ii) the Borrower may redeem or purchase shares of Borrower
Common Stock or options to purchase Borrower Common Stock, as the case may
be, held by former employees of the Borrower or any of its Subsidiaries
following the termination of their employment, provided that (w) the only
consideration paid by the Borrower in respect of such redemptions and/or
purchases shall be cash, forgiveness of liabilities and/or Shareholder
Subordinated Notes, (x) the sum of (A) the aggregate amount paid by the
Borrower in cash in respect of all such redemptions and/or purchases plus
(B) the aggregate amount of liabilities so forgiven and (C) the aggregate
amount of all cash principal and interest payments made on Shareholder
Subordinated Notes shall not exceed $5,000,000, and (y) at the time of any
cash payment or forgiveness of liabilities permitted to be made pursuant to
this Section 9.06(ii), including any cash payment under a Shareholder
Subordinated Note, no Default or Event of Default shall then exist or
result therefrom;
(iii) so long as no Default or Event of Default exists or would
result therefrom, the Borrower may pay regularly accruing cash Dividends on
Disqualified Preferred Stock issued pursuant to Section 9.13(c), with such
Dividends to be paid in accordance with the terms of the respective
certificate of designation therefor;
(iv) on the Initial Borrowing Date and concurrently with the
consummation of the Recapitalization, the Borrower may redeem options for
its common stock, with the aggregate amount expended in connection with
such redemptions not to exceed $[____________]; and
(v) the Borrower may pay regularly accruing Dividends with
respect to the Holdings PIK Preferred Stock through the issuance of
additional shares of Holdings PIK Preferred Stock in accordance with the
terms thereof.
9.07 Transactions with Affiliates. The Borrower will not, and will
----------------------------
not permit any of its Subsidiaries to, enter into any transaction or series of
transactions with any Affiliate other than on terms and conditions substantially
as favorable to the Borrower or such Subsidiary as would be reasonably expected
to be obtainable by the Borrower or such Subsidiary at the time in a comparable
arm's-length transaction with a Person other than an Affiliate; provided, that
--------
the following shall in any event be permitted: (i) the Transaction; (ii)
intercompany transactions among the Borrower and its Subsidiaries to the extent
expressly permitted by Sections 9.02, 9.04, 9.05 and 9.06 shall be permitted;
(iii) so long as no Default or Event of Default is then in existence or would
result therefrom, the payment, on a quarterly basis, of management fees to
Apollo Group in an aggregate
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amount not to exceed $125,000 in any fiscal quarter of the Borrower pursuant to,
and in accordance with the terms of, the Apollo Management Agreement, provided
--------
that if during any fiscal quarter of the Borrower, a Default or Event of Default
is in existence and such management fees cannot be paid as provided above, such
fees shall continue to accrue and may be paid at such time as all Defaults and
Events of Default have been cured or waived and so long as no Default or Event
of Default will exist immediately after giving effect to the payment thereof;
(iv) customary fees to non-officer directors of the Borrower and its
Subsidiaries; (v) the Borrower and its Subsidiaries may enter into employment
arrangements with respect to the procurement of services with their respective
officers and employees in the ordinary course of business; (vi) the payment on
the Initial Borrowing Date of one time consulting fees to Apollo in an aggregate
amount not to exceed $2,500,000; (vii) the reimbursement of Apollo for its
reasonable out-of-pocket expenses incurred in connection with performing
management services to the Borrower and its Subsidiaries or in connection with
the Transaction; (viii) so long as no Default or Event of Default is then in
existence or would result therefrom, the payment to Apollo of merger advisory
fees for each Permitted Acquisition in an amount not to exceed 1% of the fair
market value of the business or assets acquired pursuant to such Permitted
Acquisition (determined in good faith by senior management of the Borrower) and
(ix) the payment of consulting or other fees to the Borrower by any of its
Subsidiaries in the ordinary course of business. In no event shall any
management, consulting or similar fee be paid or payable by the Borrower or any
of its Subsidiaries to any Person except as specifically provided in this
Section 9.07.
9.08 Consolidated Fixed Charge Coverage Ratio. The Borrower will not
----------------------------------------
permit the Consolidated Fixed Charge Coverage Ratio for any Test Period ending
on the last day of a fiscal quarter of the Borrower specified below to be less
than the ratio set forth opposite such fiscal quarter below:
Fiscal Quarter Ended Ratio
-------------------- -----
December 31, 1998 0.85:1.00
March 31, 1999 0.90:1.00
June 30, 1999 0.95:1.00
September 30, 1999 0.95:1.00
December 31, 1999 0.95:1.00
March 31, 2000 1.00:1.00
June 30, 2000 1.05:1.00
September 30, 2000 1.05:1.00
December 31, 2000 1.10:1.00
March 31, 2001 1.10:1.00
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June 30, 2001 1.10:1.00
September 30, 2001 1.10:1.00
December 31, 2001 1.10:1.00
March 31, 2002 1.10:1.00
June 30, 2002 1.10:1.00
September 30, 2002 1.10:1.00
December 31, 2002 1.10:1.00
March 31, 2003 1.10:1.00
June 30, 2003 1.10:1.00
September 30, 2003 1.10:1.00
9.09 Minimum Consolidated EBITDA. The Borrower will not permit
---------------------------
Consolidated EBITDA (determined after giving effect to the proviso to the
definition thereof) for any Test Period ending on the last day of any fiscal
quarter of the Borrower specified below to be less than the respective amount
set forth opposite such fiscal quarter below:
Fiscal Quarter Ended Amount
-------------------- -----------
March 31, 1998 $40,000,000
June 30, 1998 $40,000,000
September 30, 1998 $42,500,000
December 31, 1998 $45,000,000
March 31, 1999 $45,000,000
June 30, 1999 $47,500,000
September 30, 1999 $47,500,000
December 31, 1999 $50,000,000
March 31, 2000 $50,000,000
June 30, 2000 $52,500,000
September 30, 2000 $52,500,000
December 31, 2000 $55,000,000
March 31, 2001 $55,000,000
June 30, 2001 $57,500,000
September 30, 2001 $57,500,000
December 31, 2001 $60,000,000
March 31, 2002 $60,000,000
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June 30, 2002 $62,500,000
September 30, 2002 $62,500,000
December 31, 2002 $65,000,000
March 31, 2003 $65,000,000
June 30, 2003 $65,000,000
September 30, 2003 $65,000,000
9.10 Consolidated Interest Coverage Ratio. The Borrower will not permit
------------------------------------
the Consolidated Interest Coverage Ratio for any Test Period ending on the last
day of any fiscal quarter of the Borrower specified below to be less than the
ratio set forth opposite such fiscal quarter below:
Fiscal Quarter Ended Ratio
-------------------- ---------
March 31, 1998 1.70:1.00
June 30, 1998 1.70:1.00
September 30, 1998 1.80:1.00
December 31, 1998 1.90:1.00
March 31, 1999 1.90:1.00
June 30, 1999 1.95:1.00
September 30, 1999 1.95:1.00
December 31, 1999 2.00:1.00
March 31, 2000 2.10:1.00
June 30, 2000 2.15:1.00
September 30, 2000 2.20:1.00
December 31, 2000 2.25:1.00
March 31, 2001 2.30:1.00
June 30, 2001 2.35:1.00
September 30, 2001 2.40:1.00
December 31, 2001 2.45:1.00
March 31, 2002 2.50:1.00
June 30, 2002 2.55:1.00
September 30, 2002 2.60:1.00
December 31, 2002 2.65:1.00
March 31, 2003 2.65:1.00
June 30, 2003 2.65:1.00
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September 30, 2003 2.65:1.00
9.11 Adjusted Total Leverage Ratio. The Borrower will not permit the
-----------------------------
Adjusted Total Leverage Ratio on the last day of any fiscal quarter specified
below to exceed the respective ratio set forth opposite such fiscal quarter
below:
Fiscal Quarter Ended Ratio
-------------------- -----
March 31, 1998 5.75:1.00
June 30, 1998 5.75:1.00
September 30, 1998 5.50:1.00
December 31, 1998 5.25:1.00
March 31, 1999 5.25:1.00
June 30, 1999 5.00:1.00
September 30, 1999 5.00:1.00
December 31, 1999 4.75:1.00
March 31, 2000 4.75:1.00
June 30, 2000 4.50:1.00
September 30, 2000 4.50:1.00
December 31, 2000 4.25:1.00
March 31, 2001 4.25:1.00
June 30, 2001 4.00:1.00
September 30, 2001 4.00:1.00
December 31, 2001 4.00:1.00
March 31, 2002 4.00:1.00
June 30, 2002 3.75:1.00
September 30, 2002 3.75:1.00
December 31, 2002 3.75:1.00
March 31, 2003 3.75:1.00
June 30, 2003 3.75:1.00
September 30, 2003 3.75:1.00
Notwithstanding anything contrary contained above or elsewhere in this
Agreement, (i) all calculations of compliance with this Section 9.11 shall be
made on a Pro Forma Basis and (ii) in no event shall the Adjusted Total Leverage
--- -----
Ratio be greater than the Maximum
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Permitted Acquisition Leverage Ratio upon the consummation of, and after giving
effect on a Pro Forma Basis to, any Permitted Acquisition.
--- -----
9.12 Limitation on Voluntary Payments and Modifications of Indebtedness;
-------------------------------------------------------------------
Modifications of Certificate of Incorporation, By-Laws and Certain Other
------------------------------------------------------------------------
Agreements; Issuances of Capital Stock; etc. The Borrower will not, and will
--------------------------------------------
not permit any of its Sub sidiaries to:
(i) amend or modify, or permit the amendment or modification of,
any provision of any Shareholder Subordinated Note, any Senior Subordinated
Note Document, any Existing Indebtedness, any PIK Preferred Stock Document
or, after the incurrence or issuance thereof, any Qualified Preferred Stock
or Permitted Debt or of any agreement (including, without limitation, any
purchase agreement, indenture, loan agreement, security agreement or
certificate of designation) relating thereto in a manner that could
reasonably be expected to in any way be adverse to the interests of the
Banks;
(ii) make (or give any notice in respect of) any voluntary or
optional payment or prepayment on or redemption, repurchase or acquisition
for value of, or any prepayment or redemption as a result of any asset
sale, change of control or similar event of, any Senior Subordinated Notes,
any Existing Indebtedness, any Permitted Subordinated Refinancing
Indebtedness or any Permitted Subordinated Indebtedness; provided that, so
--------
long as no Default or Event of Default then exists or would result
therefrom, (x) Senior Subordinated Notes may be refinanced with Permitted
Subordinated Refinancing Indebtedness, (y) the Borrower may repurchase
Senior Subordinated Notes on the open-market in aggregate principal amount
not to exceed $25,000,000, so long as the Adjusted Total Leverage Ratio is
less than 4.00:1.00 on the last day of the Test Period most recently ended
prior to the consummation of the respective repurchase (as set forth in the
officer's certificate most recently delivered pursuant to Section 8.01(e))
and (z) the Borrower and its Subsidiaries may make payments and prepayments
in connection with Existing Indebtedness;
(iii) make (or give any notice in respect of) any principal or
interest pay ment on, or any redemption or acquisition for value of, any
Shareholder Subordinated Note, except to the extent permitted by Section
9.06(ii); and
(iv) amend, modify or change in any way adverse to the interests
of the Banks in any material respect any Tax Allocation Agreement, any
Management Agreement, any Common Equity Financing Document, any
Recapitalization Document, its certificate of incorporation (including,
without limitation, by the filing or modification of any certificate of
designation other than any certificates of
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designation relating to Qualified Preferred Stock or Disqualified Preferred
Stock issued as permitted herein), by-laws, certificate of partnership,
partnership agreement, certificate of limited liability company, limited
liability company agreement or any agreement entered into by it, with
respect to its capital stock or other equity interest (including any
Shareholders' Agreement), or enter into any new Tax Allocation Agreement,
Management Agreement or agreement with respect to its capital stock or
other equity interest which could reasonably be expected to in any way be
adverse to the interests of the Banks; provided that the foregoing clause
shall not restrict the ability of the Borrower and its Subsidiaries to
amend their respective certificates of incorporation to authorize the
issuance of capital stock otherwise permitted to be issued pursuant to the
terms of this Agreement.
9.13 Limitation on Issuance of Capital Stock. (a) The Borrower will
---------------------------------------
not, and will not permit any of its Subsidiaries to, issue (i) any Preferred
Stock (other than (x) PIK Preferred Stock issued in accordance with the
requirements of Section 5.08, and the issuance of additional shares of PIK
Preferred Stock in payment of regularly accruing dividends on theretofore
outstanding shares of Holdings Preferred Stock and (y) Preferred Stock issued
pursuant to clauses (c) and (d) below, respectively) or any options, warrants or
rights to purchase Preferred Stock or (ii) any redeemable common stock unless,
in either case, the issuance thereof is, and all terms thereof are, satisfactory
to the Required Banks in their sole discretion.
(b) The Borrower shall not permit any of its Subsidiaries to issue
any capital stock (including by way of sales of treasury stock) or any options
or warrants to pur chase, or securities convertible into, capital stock, except
(i) for transfers and replacements of then outstanding shares of capital stock,
(ii) for stock splits, stock dividends and additional issuances which do not
decrease the percentage ownership of the Borrower or any of its Subsidiaries in
any class of the capital stock of such Subsidiaries, (iii) to qualify directors
to the extent required by applicable law and (iv) Subsidiaries formed after the
Effective Date pursuant to Section 9.15 may issue capital stock in accordance
with the requirements of Section 9.15. All capital stock issued in accordance
with this Section 9.13(b) shall, to the extent required by the Pledge Agreement,
be delivered to the Collateral Agent for pledge pursuant to the Pledge
Agreement.
(c) The Borrower may issue Disqualified Preferred Stock so long as
(i) no Default or Event of Default then exists or would exist immediately after
giving effect to the respective issuance, (ii) the aggregate liquidation
preference for all Disqualified Preferred Stock issued after the Effective Date
pursuant to this Section 9.13(c) shall not to exceed, when combined with the
aggregate principal amount of all then outstanding Indebtedness permitted by
Section 9.04(j), $15,000,000, (iii) with respect to each issue of Disqualified
Preferred Stock, the gross cash proceeds therefrom (or in the case of
Disqualified Preferred Stock directly issued as consideration for a Permitted
Acquisition, the fair market value
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thereof (as determined in good faith by the Borrower) of the assets received
therefor) shall not exceed the liquidation preference thereof at the time of
issuance, (iv) calculations are made by the Borrower of compliance with the
covenants contained in Sections 9.08 through 9.11 for the Calculation Period
most recently ended prior to the date of the respective issuance of Disqualified
Preferred Stock, on a Pro Forma Basis after giving effect to the respective
--- -----
issuance of Disqualified Preferred Stock, and such calculations shall show that
such financial covenants would have been complied with if such issuance of
Disqualified Preferred Stock had been consummated on the first day of the
respective Calculation Period, and (v) the Borrower shall furnish to the Agent a
certificate by an Authorized Officer of the Borrower certifying to the best of
his or her knowledge as to compliance with the requirements of this Section
9.13(c) and containing the pro forma calculations required by the preceding
--- -----
clause (iv).
(d) The Borrower may issue Qualified Preferred Stock so long as, with
respect to each issue of Qualified Preferred Stock, the Borrower receives
reasonably equivalent consideration (as determined in good faith by the
Borrower).
9.14 Limitation on Certain Restrictions on Subsidiaries. (a) The
--------------------------------------------------
Borrower will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective,
any encumbrance or restriction on the ability of any such Subsidiary to (x) pay
dividends or make any other distributions on its capital stock or any other
interest or participation in its profits owned by the Borrower or any Subsidiary
of the Borrower, or pay any Indebtedness owed to the Borrower or a Subsidiary of
the Borrower, (y) make loans or advances to the Borrower or any Subsidiary of
the Borrower or (z) transfer any of its properties or assets to the Borrower or
any of its Subsidiaries, except for such encumbrances or restrictions existing
under or by reason of (i) applicable law, (ii) this Agreement and the other
Credit Documents, (iii) the provisions contained in the Existing Indebtedness,
(iv) the Senior Subordinated Note Documents, (v) customary provisions
restricting subletting or assignment of any lease governing a leasehold interest
of the Borrower or a Subsidiary of the Borrower, (vi) customary provisions
restrict ing assignment of any contract entered into by the Borrower or any
Subsidiary of the Borrower in the ordinary course of business and (vii) any
agreement or instrument governing Permitted Acquired Debt, which encumbrance or
restriction is not applicable to any Person or the properties or assets of any
Person, other than the Person or the properties or assets of the Person acquired
pursuant to the respective Permitted Acquisition and so long as the respective
encumbrances or restrictions were not created (or made more restrictive) in
connection with or in anticipation of the respective Permitted Acquisition.
(b) The Borrower will not, and will not permit any of its
Subsidiaries to, directly or indirectly agree to any consensual encumbrance or
restriction on the ability of any Non-Subsidiary Joint Venture to (x) pay
dividends or make other distributions on its capital stock or other interests or
participations in its profits owned by the Borrower or any
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Subsidiary of the Borrower or (y) make loans or advances to the Borrower or any
Subsidiary of the Borrower, except for such encumbrances or restrictions
existing under or by reason of (i) applicable law, (ii) this Agreement and the
other Credit Documents, (iii) customary provisions restricting subletting or
assignment of any lease governing a leasehold interest of such Non-Subsidiary
Joint Venture, (iv) the Senior Subordinated Note Documents, (v) customary
provisions restricting assignment of any contract entered into by such Joint
Venture in the ordinary course of business, (vi) normal restrictions (as
determined in good faith by the Borrower) applicable to any Non-Subsidiary Joint
Venture at the time of the establishment thereof (so long as not in connection
with a Permitted Acquisition) and (vii) restrictions applicable to any Non-
Subsidiary Joint Venture existing at the time of the acquisition thereof as a
result of an Investment pursuant to Section 9.05 or Permitted Acquisition
effected in accordance with Section 8.14; provided that the restrictions
--------
applicable to the respective Non-Subsidiary Joint Venture are not made worse, or
more burdensome, from the perspective of the Borrower and its Subsidiaries, than
those as in effect immediately before giving effect to the consummation of the
respective Investment or Permitted Acquisition.
9.15 Limitation on the Creation of Subsidiaries and Joint Ventures.
-------------------------------------------------------------
(a) Notwithstanding anything to the contrary contained in this Agreement, the
Borrower will not, and will not permit any of its Subsidiaries to, establish,
create or acquire after the Effective Date any Subsidiary (other than Joint
Ventures permitted to be established in accordance with the requirements of
Section 9.05(l)); provided that the (A) Borrower and its Wholly-Owned
--------
Subsidiaries shall be permitted to establish or create Wholly-Owned Subsidiaries
so long as, in each case, (i) at least 15 days' prior written notice thereof is
given to the Agent (or such shorter period of time as is acceptable to the
Agent), (ii) the capital stock of such new Subsidiary is promptly pledged
pursuant to, and to the extent required by, this Agreement and the Pledge
Agreement and the certificates, if any, representing such stock, together with
stock powers duly executed in blank, are delivered to the Collateral Agent,
(iii) such new Subsidiary (other than a Foreign Subsidiary except to the extent
otherwise required pursuant to Section 8.12) promptly executes a counterpart of
the Subsidiaries Guaranty, the Pledge Agreement and the Security Agreement, and
(iv) to the extent requested by the Agent or the Required Banks, such new
Subsidiary takes all actions required pursuant to Section 8.11 and (B)
Subsidiaries may be acquired pursuant to Permitted Acquisitions so long as, in
each such case (i) with respect to each Wholly-Owned Subsidiary acquired
pursuant to a Permitted Acquisition, the actions specified in preceding clause
(A) shall be taken and (ii) with respect to each Subsidiary which is not a
Wholly-Owned Subsidiary and is acquired pursuant to a Permitted Acquisition, all
capital stock thereof owned by any Credit Party shall be pledged pursuant to the
Pledge Agreement. In addition, each new Subsidiary that is required to execute
any Credit Document shall execute and deliver, or cause to be executed and
delivered, all other rele vant documentation of the type described in Section 5
as such new Subsidiary would have had to deliver if such new Subsidiary were a
Credit Party on the Initial Borrowing Date.
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(b) The Borrower will not, and will not permit any of its
Subsidiaries to, enter into any Joint Ventures, except to the extent permitted
by Section 9.05(l).
SECTION 10. Events of Default. Upon the occurrence of any of the
-----------------
following specified events (each, an "Event of Default"):
10.01 Payments. The Borrower shall (i) default in the payment when
--------
due of any principal of the Loans or (ii) default, and such default shall
continue for three or more Business Days, in the payment when due of any Unpaid
Drawing, any interest on the Loans or any Fees or any other amounts owing
hereunder or under any other Credit Document; or
10.02 Representations, etc. Any representation, warranty or
---------------------
statement made by any Credit Party herein or in any other Credit Document or in
any statement or certificate delivered pursuant hereto or thereto shall prove to
be untrue in any material respect on the date as of which made or deemed made;
or
10.03 Covenants. Any Credit Party shall (a) default in the due
---------
performance or observance by it of any term, covenant or agreement contained in
Sections 8.01(f)(i), 8.10, 8.13, 8.14 or 9, or (b) default in the due
performance or observance by it of any term, covenant or agreement (other than
those referred to in Section 10.01, 10.02 or clause (a) of this Section 10.03)
contained in this Agreement and such default shall continue unremedied for a
period of at least 30 days after notice to the defaulting party by the Agent or
the Required Banks; or
10.04 Default Under Other Agreements. (a) The Borrower or any of
------------------------------
its Subsidiaries shall (i) default in any payment with respect to any
Indebtedness (other than the Obligations) beyond the period of grace, if any,
provided in the instrument or agree ment under which Indebtedness was created or
(ii) default in the observance or performance of any agreement or condition
relating to any such Indebtedness or contained in any instru ment or agreement
evidencing, securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness (or a trustee or
agent on behalf of such holder or holders) to cause (determined without regard
to whether any notice is required), any such Indebtedness to become due prior to
its stated maturity; or (b) any Indebtedness (other than the Obligations) of the
Borrower or any of its Subsidiaries shall be declared to be due and payable, or
shall be required to be prepaid other than by a regularly scheduled required
prepayment or as a mandatory prepayment (unless such required prepayment or
mandatory prepayment results from a default thereunder or an event of the type
that consti tutes an Event of Default), prior to the stated maturity thereof;
provided, that it shall not constitute an Event of Default pursuant to clause
--------
(a) or (b) of this Section 10.04 unless the
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principal amount of any one issue of such Indebtedness, or the aggregate amount
of all such Indebtedness referred to in clauses (a) and (b) above, exceeds
$4,500,000 at any one time; or
10.05 Bankruptcy, etc. The Borrower or any of its Subsidiaries shall
----------------
commence a voluntary case concerning itself under Title 11 of the United States
Code entitled "Bankruptcy," as now or hereafter in effect, or any successor
thereto (the "Bank ruptcy Code"); or an involuntary case is commenced against
the Borrower or any of its Subsidiaries and the petition is not controverted
within 20 days, or is not dismissed within 60 days, after commencement of the
case; or a custodian (as defined in the Bankruptcy Code) is appointed for, or
takes charge of, all or substantially all of the property of the Borrower or any
of its Subsidiaries; or the Borrower or any of its Subsidiaries commences any
other proceeding under any reorganization, arrangement, adjustment of debt,
relief of debtors, dissolution, insolvency or liquidation or similar law of any
jurisdiction whether now or hereafter in effect relating to the Borrower or any
of its Subsidiaries; or there is commenced against the Borrower or any of its
Subsidiaries any such proceeding which remains undismissed for a period of 60
days; or the Borrower or any of its Subsidiaries is adjudicated insolvent or
bankrupt; or any order of relief or other order approving any such case or
proceeding is entered; or the Borrower or any of its Subsidiaries suffers any
appointment of any custodian or the like for it or any substantial part of its
property to con tinue undischarged or unstayed for a period of 60 days; or the
Borrower or any of its Subsidiaries makes a general assignment for the benefit
of creditors; or any corporate action is taken by the Borrower or any of its
Subsidiaries for the purpose of effecting any of the foregoing; or
10.06 ERISA. (a) Any Plan shall fail to satisfy the minimum funding
-----
standard required for any plan year or part thereof under Section 412 of the
Code or Section 302 of ERISA or a waiver of such standard or extension of any
amortization period is sought or granted under Section 412 of the Code or
Section 303 or 304 of ERISA, a Reportable Event shall have occurred, a
contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of the Plan
subject to Title IV of ERISA shall be subject to the advance reporting
requirement of PBGC Regulation Section 4043.61 (without regard to subparagraph
(b)(1) thereof) and an event described in subsection .62, .63, .64, .65, .66,
.67 or .68 of PBGC Regulation Section 4043 shall be reasonably expected to occur
within the following 30 days, any Plan which is subject to Title IV of ERISA
shall have had or is likely to have a trustee appointed to administer such Plan,
any Plan which is subject to Title IV of ERISA is, shall have been or is likely
to be terminated or to be the subject of termination proceedings under ERISA,
any Plan shall have an Unfunded Current Liability, a contribution required to be
made with respect to a Plan has not been timely made, the Borrower or any
Subsidiary of the Borrower or any ERISA Affiliate has incurred or is likely to
incur any liability to or on account of a Plan under Section 409, 502(i),
502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section
401(a)(29), 4971
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or 4975 of the Code or on account of a group health plan (as defined in Section
607(1) of ERISA or Section 4980B(g)(2) of the Code) under Section 4980B of the
Code, or the Borrower or any Subsidiary of the Borrower has incurred or is
likely to incur liabilities pursuant to one or more employee welfare benefit
plans (as defined in Section 3(1) of ERISA) that provide benefits to retired
employees or other former employees (other than as required by Section 601 of
ERISA) or Plans; (b) there shall result from any such event or events the
imposition of a lien, the granting of a security interest, or a liability or a
material risk of incurring a liability; and (c) such lien, security interest or
liability, individually, and/or in the aggregate, in the opinion of the Required
Banks, has had, or could reasonably be expected to have, a Material Adverse
Effect; or
10.07 Security Documents. (a) Any Security Document shall cease to
------------------
be in full force and effect, or shall cease to give the Collateral Agent the
Liens, rights, powers and privileges purported to be created thereby in favor of
the Collateral Agent, superior to and prior to the rights of all third Persons
(except as permitted by Section 9.03), and subject to no other Liens (except as
permitted by Section 9.03), or (b) any Credit Party shall default in the due
performance or observance of any term, covenant or agreement on its part to be
performed or observed pursuant to any such Security Document and such default
shall continue beyond any cure or grace period specifically applicable thereto
pursuant to the terms of any such Security Document; or
10.08 Subsidiaries Guaranty. The Subsidiaries Guaranty or any
---------------------
provision thereof shall cease to be in full force and effect, or any Subsidiary
Guarantor or any Person acting by or on behalf of such Subsidiary Guarantor
shall deny or disaffirm such Subsidiary Guarantor's obligations under the
Subsidiaries Guaranty or any Subsidiary Guarantor shall default in the due
performance or observance of any term, covenant or agreement on its part to be
performed or observed pursuant to the Subsidiaries Guaranty; or
10.09 Judgments. One or more judgments or decrees shall be entered
---------
against the Borrower or any of its Subsidiaries involving a liability (to the
extent not paid or not fully covered by insurance) in excess of $4,500,000 for
all such judgments and decrees and all such judgments or decrees shall not have
been vacated, discharged or stayed or bonded pending appeal within 60 days from
the entry thereof; or
10.10 Ownership. A Change of Control Event shall have occurred;
---------
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Agent shall, upon the written request of the
Required Banks, by written notice to the Borrower, take any or all of the
following actions, without prejudice to the rights of the Agent or any Bank to
enforce its claims against any Subsidiary Guarantor or the Borrower, except as
otherwise specifically provided for in this Agreement (provided, that if an
--------
Event of Default specified in Section 10.05 shall occur with respect to the
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Borrower, the result which would occur upon the giving of written notice by the
Agent as specified in clauses (i) and (ii) below shall occur automatically
without the giving of any such notice): (i) declare the Total Commitment
terminated, whereupon the Commitment of each Bank shall forthwith terminate
immediately and any Commitment Fees shall forthwith become due and payable
without any other notice of any kind; (ii) declare the principal of and any
accrued interest in respect of all Loans and all Obligations owing hereunder
(including Unpaid Drawings) to be, whereupon the same shall become, forthwith
due and payable without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrower; (iii) enforce, as
Collateral Agent (or direct the Collateral Agent to enforce), any or all of the
Liens and security interests created pursuant to the Security Documents; (iv)
terminate any Letter of Credit which may be terminated in accordance with its
terms; (v) direct the Borrower to pay (and the Borrower hereby agrees upon
receipt of such notice, or upon the occurrence of any Event of Default specified
in Section 10.05, to pay) to the Collateral Agent at the Payment Office such
additional amounts of cash, to be held as security for the Borrower's
reimbursement obligations in respect of Letters of Credit then outstanding,
equal to the aggregate Stated Amount of all Letters of Credit then outstanding;
and (vi) apply any cash collateral as provided in Section 4.02.
SECTION 11. Definitions. As used herein, the following terms shall
-----------
have the meanings herein specified unless the context otherwise requires.
Defined terms in this Agreement shall include in the singular number the plural
and in the plural the singular:
"Acquired Person" shall have the meaning provided in the definition of
Permitted Acquisition.
"Acquisition Corp." shall mean Newport Acquisition Corp., a Delaware
corporation and prior to the Alliance Merger, a Wholly-Owned Subsidiary of
Newport.
"Additional Security Documents" shall have the meaning provided in
Section 8.11.
"Adjusted Certificate of Deposit Rate" shall mean, on any day, the sum
(rounded to the nearest 1/100 of 1%) of (1) the rate obtained by dividing (x)
the most recent weekly average dealer offering rate for negotiable certificates
of deposit with a three-month maturity in the secondary market as published in
the most recent Federal Reserve System publication entitled "Select Interest
Rates," published weekly on Form H.15 as of the date hereof, or if such
publication or a substitute containing the foregoing rate informa tion shall not
be published by the Federal Reserve System for any week, the weekly average
offering rate determined by the Agent on the basis of quotations for such
certifi xxxxx received by it from three certificate of deposit dealers in New
York of recognized
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standing or, if such quotations are unavailable, then on the basis of other
sources reasonably selected by the Agent, by (y) a percentage equal to 100%
minus the stated maximum rate of all reserve requirements as specified in
Regulation D applicable on such day to a three-month certificate of deposit of a
member bank of the Federal Reserve System in excess of $100,000 (including,
without limitation, any marginal, emergency, supplemental, special or other
reserves), plus (2) the then daily net annual assessment rate as estimated by
the Agent for determining the current annual assessment payable by BTCo to the
Federal Deposit Insurance Corporation for insuring three month certificates of
deposit.
"Adjusted Consolidated Net Income" for any period shall mean
Consolidated Net Income for such period plus, without duplication, the sum of
the amount of all net non-cash charges (including, without limitation,
depreciation, amortization, deferred tax expense, non-cash interest expense) and
net non-cash losses which were included in arriving at Consolidated Net Income
for such period less all net non-cash gains included in arriving at Consolidated
Net Income for such period; provided that gains or losses from sales of assets
--------
(other than sales of inventory in the ordinary course of business) shall be
excluded to the extent same would otherwise be included in Adjusted Consolidated
Net Income for the respective period.
"Adjusted Consolidated Working Capital" at any time shall mean
Consolidated Current Assets (but excluding therefrom all cash and Cash
Equivalents) less Consolidated Current Liabilities.
"Adjusted Excess Cash Flow" shall mean, for any period, the remainder
of (i) Excess Cash Flow minus (ii) the product of (I) the aggregate amount of
principal repayments of Loans to the extent (and only to the extent) that such
repayments were (x) required as a result of a Scheduled Commitment Reduction
under Section 3.03 or a Scheduled Repayment under Section 4.02 or (y) made as a
voluntary prepayment pursuant to Section 4.01 with internally generated funds
(but in a case of a voluntary prepayment of Revolving Loans, only to the extent
accompanied by a voluntary reduction to the Total Revolving Loan Commitment)
during such period multiplied by (II) 2.
"Adjusted RL Percentage" shall mean (x) at a time when no Bank Default
exists, for each Bank, such Bank's RL Percentage and (y) at a time when a Bank
Default exists, (i) for each Bank that is a Defaulting Bank, zero and (ii) for
each Bank that is a Non-Defaulting Bank, the percentage determined by dividing
such Bank's Revolving Loan Commitment at such time by the Adjusted Total
Revolving Loan Commitment at such time, it being understood that all references
herein to Revolving Loan Commitments and the Adjusted Total Revolving Loan
Commitment at a time when the Total Revolving Loan Commitment or Adjusted Total
Revolving Loan Commitment, as the case may be, has been terminated shall be
references to the Revolving Loan Commitments or Adjusted Total Revolving Loan
Commitment, as the case may be, in effect immediately prior to such ter-
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mination, provided that (A) no Bank's Adjusted RL Percentage shall change upon
--------
the occurrence of a Bank Default from that in effect immediately prior to such
Bank Default if after giving effect to such Bank Default, and any repayment of
Revolving Loans and Swingline Loans at such time pursuant to Section 4.02(a) or
otherwise, the sum of (i) the aggregate outstanding principal amount of
Revolving Loans of all Non-Defaulting Banks, plus (ii) the aggregate outstanding
principal amount of Swingline Loans, plus (iii) the Letter of Credit
Outstandings, exceed the Adjusted Total Revolving Loan Commitment; (B) the
changes to the Adjusted RL Percentage that would have become effective upon the
occur rence of a Bank Default but that did not become effective as a result of
the preceding clause (A) shall become effective on the first date after the
occurrence of the relevant Bank Default on which the sum of (i) the aggregate
outstanding principal amount of the Revolving Loans of all Non-Defaulting Banks,
plus (ii) the aggregate outstanding principal amount of Swingline Loans, plus
(iii) the Letter of Credit Outstandings, is equal to or less than the Adjusted
Total Revolving Loan Commitment; and (C) if (i) a Non-Defaulting Bank's Adjusted
RL Percentage is changed pursuant to the preceding clause (B) and (ii) any repay
ment of such Bank's Revolving Loans or of Unpaid Drawings or of Swingline Loans
that were made during the period commencing after the date of the relevant Bank
Default and ending on the date of such change to its Adjusted RL Percentage must
be returned to the Borrower as a preferential or similar payment in any
bankruptcy or similar proceeding of the Borrower, then the change to such Non-
Defaulting Bank's Adjusted RL Percentage effected pursuant to said clause (B)
shall be reduced to that positive change, if any, as would have been made to its
Adjusted RL Percentage if (x) such repayments had not been made and (y) the
maximum change to its Adjusted RL Percentage would have resulted in the sum of
the outstanding principal of Revolving Loans made by such Bank plus such Bank's
new Adjusted RL Percentage of the outstanding principal amount of Swingline
Loans and of Letter of Credit Outstandings equalling such Bank's Revolving Loan
Commitment at such time.
"Adjusted Senior Leverage Ratio" shall mean the Adjusted Total
Leverage Ratio, except that references to "Consolidated Debt" and "Adjusted
Total Leverage Ratio" therein shall instead be references to "Consolidated
Senior Debt" and "Adjusted Senior Leverage Ratio," respectively.
"Adjusted Total Leverage Ratio" shall mean, on any date, the ratio of
(i) Consolidated Debt on such date to (ii) Consolidated EBITDA for the Test
Period most recently ended on or prior to such date (determined after giving
effect to the proviso to the definition of Consolidated EBITDA contained
herein). All calculations of the Adjusted Total Leverage Ratio shall be made on
a Pro Forma Basis, with determinations of Adjusted Total Leverage Ratio to give
--- -----
effect to all adjustments (including, without limitation, those specified in
clause (v)) contained in the definition of "Pro Forma Basis" contained herein.
--- -----
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"Adjusted Total Revolving Loan Commitment" shall mean at any time the
Total Revolving Loan Commitment less the aggregate Revolving Loan Commitments of
----
all Defaulting Banks.
"Affected Loans" shall have the meaning provided in Section 4.02(i).
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling (including but not limited to all directors
and officers of such Person), controlled by, or under direct or indirect common
control with such Person; provided, however, that for purposes of Section 9.07,
-------- -------
an Affiliate of the Borrower shall include any Person that directly or
indirectly owns more than 5% of any class of the capital stock of the Borrower
and any officer or director of the Borrower or any such Person.
"Agent" shall have the meaning provided in the first paragraph of this
Agreement and shall include any successor to the Agent appointed pursuant to
Section 12.10.
"Agreement" shall mean this Credit Agreement, as the same may be from
time to time modified, amended and/or supplemented.
"Alliance Holdover Shareholders" shall mean certain existing
shareholders of the Borrower (prior to giving effect to the Recapitalization).
"Alliance Merger" shall have the meaning provided in Section 5.08(a).
"Apollo Group" shall mean Apollo Advisors, L.P., Apollo Investment
Fund, L.P., Apollo Investment Fund III, L.P., Apollo Overseas Partners III,
L.P., Apollo (U.K.) Partners III, L.P., AIF II, L.P., and Apollo Advisors II,
L.P., all Delaware limited partnerships (except that Apollo (U.K.) Partners III,
L.P. is a limited partnership organized under the laws of England).
"Apollo Management Agreement" shall mean the consulting agreement,
dated ___________, 1997, between Apollo Advisors, L.P. and __________________.
"Applicable Commitment Fee Percentage" shall mean, at any time, a
percentage per annum equal to 1/2 of 1%; provided, that if at any time the
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Interest Reduction Discount then in effect with respect to Revolving Loans is
(i) greater than or equal to 3/8 of 1% but less than 1%, then the Applicable
Commitment Fee Percentage shall instead be 3/8 of 1% and (ii) 1% or greater,
then the Applicable Commitment Fee Percentage shall instead be 1/4 of 1%.
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"Applicable Excess Cash Flow Percentage" shall mean, with respect to
any Excess Cash Flow Payment Date, 75%; provided that so long as no Default or
--------
Event of Default is then in existence, if on the last day of the relevant Excess
Cash Flow Payment Period, the Adjusted Total Leverage Ratio for the Test Period
then most recently ended is less than 4.00:1.00, then the Applicable Excess Cash
Flow Percentage shall instead be 50%.
"Applicable Margin" shall mean a percentage per annum equal to (i) in
the case of Revolving Loans (x) maintained as Base Rate Loans, 1.25% less the
then applicable Interest Reduction Discount and (y) maintained as Eurodollar
Loans, 2.25% less the then applicable Interest Reduction Discount and (ii) in
the case of Term Loans (x) maintained as Base Rate Loans, 1.50% less the then
applicable Interest Reduction Discount and (y) maintained as Eurodollar Loans,
2.50% less the then applicable Interest Reduction Discount.
"Applicable Prepayment Percentage" shall mean, at any time, (i) for
purposes of Sections 4.02(c) and 4.02(d), 100%, provided that if at any time the
--------
Adjusted Total Leverage Ratio is less than 4.00 to 1.00, the Applicable
Prepayment Percentage shall instead be 75% and (ii) for purposes of Section
4.02(e), 50%, provided that if at any time the Adjusted Total Leverage Ratio is
less than 4.00 to 1.00, the Applicable Prepayment Percentage shall instead be
0%. Notwithstanding anything to the contrary in this definition, at any time a
Default or Event of Default is then in existence, the Applicable Prepayment
Percentage for purposes of (x) Section 4.02(c) and (d) shall be 100% and (y)
Section 4.02(e) shall be 50%.
"Asset Sale" shall mean any sale, transfer or other disposition by the
Borrower or any of its Subsidiaries to any Person other than the Borrower or any
Wholly-Owned Subsidiary of the Borrower of any asset (including, without
limitation, any capital stock or other securities of another Person, but
excluding the sale by such Person of its own capital stock) of the Borrower or
such Subsidiary other than (i) sales, transfers or other dispositions of
inventory made in the ordinary course of business, (ii) dispositions or
transfers arising out of, or in connection with, the events described in clauses
(i) and (ii) of the definition of Recovery Event, (iii) any sale or other
disposition of assets pursuant to a Permitted Sale-Leaseback Transaction
effected in accordance with the definition thereof and the requirements of
Section 9.02(k), and (iv) other sales and dispositions that generate Net Sale
Proceeds of less than $500,000 in the aggregate in any fiscal year of the
Borrower.
"Assignment and Assumption Agreement" shall mean the Assignment and
Assumption Agreement substantially in the form of Exhibit L (appropriately
completed).
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"Authorized Officer" shall mean, with respect to (i) delivering
Notices of Borrowing, Notices of Conversion, Letter of Credit Requests and
similar notices, and delivering financial information and officer's certificates
pursuant to this Agreement, any treasurer or other financial officer of the
Borrower and (ii) any other matter in connection with this Agreement or any
other Credit Document, any officer (or a person or persons so designated by any
two officers) of the Borrower, in each case to the extent reasonably acceptable
to the Agent.
"Available JV Basket Amount" shall mean, on any date of determination,
an amount equal to the sum of (i) $15,000,000 minus (ii) the aggregate amount of
-----
Investments made (including for such purpose the fair market value of any
Healthcare Unit contributed to any Joint Venture (as determined in good faith by
senior management of the Borrower), net of Indebtedness and, without
duplication, Capitalized Lease Obligations assigned to, and assumed by, the
respective Joint Venture in connection therewith) pursuant to Section 9.05(l)
after the Effective Date, minus (iii) the aggregate amount of Indebtedness or
-----
other obligations (whether absolute, accrued, contingent or otherwise and
whether or not due) of any Joint Venture for which the Borrower or any of its
Subsidiaries (other than the respective Joint Venture) is liable, minus (iv) all
-----
payments made by the Borrower or any of its Subsidiaries (other than the
respective Joint Venture) in respect of Indebtedness or other obligations of the
respective Joint Venture (including, without limitation, payments in respect of
obligations described in preceding clause (iii)), plus (v) the amount of any
----
increase to the Available JV Basket Amount made after the Effective Date in
accordance with the provisions of Section 9.05(l). In connection with the
foregoing, it is understood that the acquisition of an Acquired Person which has
ownership interests in one or more Joint Ventures, pursuant to a Permitted
Acquisition effected in accordance with the relevant requirements of this
Agreement shall not be deemed to constitute an Investment pursuant to Section
9.05(l) and the Available JV Basket Amount shall not be reduced as a result of
the payment of consideration owing to effect the Permitted Acquisition (although
the Available JV Basket Amount would be affected to the extent preceding clauses
(iii) or (iv) apply with respect to the Joint Venture so acquired or to the
extent additional Investments are made in the respective Joint Venture pursuant
to Section 9.05(l)).
"Bank" shall have the meaning provided in the first paragraph of this
Agreement.
"Bank Default" shall mean (i) the refusal (which has not been
retracted) of a Bank to make available its portion of any Borrowing (including
any Mandatory Borrowing) or to fund its portion of any unreimbursed payment
under Section 2.03 or (ii) a Bank having notified the Agent and/or the Borrower
that it does not intend to comply with the obligations under Section 1.01(b),
1.01(d) or 2.03, in the case of either clause (i) or (ii) above as a result of
the appointment of a receiver or conservator with respect to such Bank at the
direction or request of any regulatory agency or authority.
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"Bankruptcy Code" shall have the meaning provided in Section 10.05.
"Base Rate" at any time shall mean the highest of (x) the rate which
is 1/2 of 1% in excess of the Adjusted Certificate of Deposit Rate, (y) the rate
which is 1/2 of 1% in excess of the Federal Funds Rate and (z) the Prime Lending
Rate.
"Base Rate Loan" shall mean each Loan bearing interest at the rates
provided in Section 1.08(a).
"Borrower" shall have the meaning provided in the first paragraph of
this Agreement.
"Borrower Common Stock" shall have the meaning provided in Section
7.13(a).
"Borrowing" shall mean and include (i) the borrowing of Swingline
Loans from BTCo on a given date and (ii) the borrowing of one Type of Loan
pursuant to a single Tranche by the Borrower from all of the Banks having
Commitments with respect to such Tranche on a pro rata basis on a given date (or
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resulting from conversions on a given date), having in the case of Eurodollar
Loans the same Interest Period; provided, that Base Rate Loans incurred pursuant
--------
to Section 1.10(b) shall be considered part of any related Borrowing of
Eurodollar Loans.
"BTCo" shall mean Bankers Trust Company, in its individual capacity,
and any successor corporation thereto by merger, consolidation or otherwise.
"Business Day" shall mean (i) for all purposes other than as covered
by clause (ii) below, any day excluding Saturday, Sunday and any day which shall
be in the City of New York a legal holiday or a day on which banking
institutions are authorized by law or other governmental actions to close and
(ii) with respect to all notices and determina tions in connection with, and
payments of principal and interest on, Eurodollar Loans, any day which is a
Business Day described in clause (i) and which is also a day for trading by and
between banks in U.S. dollar deposits in the interbank Eurodollar market.
"Calculation Period" shall have the meaning provided in Section 8.14.
"Capital Expenditures" shall mean, with respect to any Person, for any
period, all expenditures by such Person which should be capitalized in
accordance with GAAP during such period, including all such expenditures with
respect to fixed or capital assets (including, without limitation, expenditures
for maintenance and repairs which should be capitalized in accordance with GAAP)
and the amount of all Capitalized Lease Obligations incurred by such Person
during such period.
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"Capital Lease," as applied to any Person, shall mean any lease of any
prop erty (whether real, personal or mixed) by that Person as lessee which, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that Person.
"Capitalized Lease Obligations" shall mean all obligations under
Capital Leases of the Borrower or any of its Subsidiaries, in each case taken at
the amount thereof accounted for as liabilities in accordance with GAAP.
"Cash Equivalents" shall mean, as to any Person, (i) securities issued
or directly and fully guaranteed or insured by the United States or any agency
or instrumental ity thereof (provided that the full faith and credit of the
--------
United States is pledged in support thereof) having maturities of not more than
six months from the date of acquisition, (ii) time deposits, certificates of
deposit and bankers' acceptances of any Bank or any commer cial bank having, or
which is the principal banking subsidiary of a bank holding company organized
under the laws of the United States, any State thereof, the District of Columbia
or any foreign jurisdiction having capital, surplus and undivided profits
aggregating in excess of $200,000,000 and having a long-term unsecured debt
rating of at least "A" or the equivalent thereof from S&P's or "A2" or the
equivalent thereof from Xxxxx'x, with maturities of not more than six months
from the date of acquisition by such Person, (iii) repurchase agreements with a
term of not more than 30 days, involving securities of the types described in
preceding clause (i), and entered into with commercial banks meeting the
requirements of preceding clause (ii), (iv) commercial paper issued by any
Person incorporated in the United States rated at least A-1 or the equivalent
thereof by S&P's or at least P-1 or the equivalent thereof by Xxxxx'x and in
each case maturing not more than six months after the date of acquisition by
such Person, (v) investments in money market funds substantially all of whose
assets are comprised of securities of the types described in clauses (i) through
(iv) above and (vi) demand deposit accounts maintained in the ordinary course of
business.
"Change of Control Event" shall mean, (I) at any time prior to the
consummation of a Qualified IPO, (a) Apollo Group and its Affiliates shall cease
to own on a fully diluted basis in the aggregate at least 30% of the economic
and voting interest in the Borrower's capital stock (for such purposes,
excluding the PIK Preferred Stock) or (b) Apollo Group and its Affiliates,
together with the Management Participants and other investors which own shares
of Borrower Common Stock on the Initial Borrowing Date, shall cease to own on a
fully diluted basis in the aggregate at least a majority of the outstanding
Voting Stock of the Borrower or (c) any Person or "group" (within the meaning of
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as in effect on
the Effective Date, other than the Permitted Holders, shall (A) have acquired
beneficial ownership of 30% or more on a fully diluted basis of the voting
and/or economic interest in the Borrower's capital stock or (B) obtained the
power (whether or not exercised) to elect a majority of the Borrower's directors
or (d) the Board of Directors of the Borrower shall
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cease to consist of a majority of Continuing Directors or (e) a "change of
control" or similar event shall occur as provided in the Senior Subordinated
Note Indenture or in any Existing Indebtedness, Permitted Debt, PIK Preferred
Stock, Disqualified Preferred Stock or Qualified Preferred Stock, to the extent
the outstanding principal amount or liquidation preference, as the case may be,
of such Existing Indebtedness, Permitted Debt, PIK Preferred Stock, Disqualified
Preferred Stock or Qualified Preferred Stock exceeds $10,000,000 or (II) at any
time after a Qualified IPO, (a) any Person or "group" (within the meaning of
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as in effect on
the Effective Date), other than the Permitted Holders, shall have acquired
beneficial ownership of 25% or more on a fully diluted basis of the voting
and/or economic interest in the Borrower's capital stock and Apollo Group and
its Affiliates shall own less than such Person or "group" on a fully diluted
basis of the economic and voting interest in the Borrower's capital stock or (b)
the Board of Directors of the Borrower shall cease to consist of a majority of
Continuing Directors or (c) a "change of control" or similar event shall occur
as provided in Senior Subordinated Note Indenture or in any Existing
Indebtedness, Permitted Debt, PIK Preferred Stock, Disqualified Preferred Stock
or Qualified Preferred Stock, to the extent the outstanding principal amount or
liquidation preference, as the case may be, of such Existing Indebtedness,
Permitted Debt, PIK Preferred Stock, Disqualified Preferred Stock or Qualified
Preferred Stock exceeds $10,000,000.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and rulings issued thereunder.
Section refer ences to the Code are to the Code, as in effect at the date of
this Agreement and any subse quent provisions of the Code, amendatory thereof,
supplemental thereto or substituted therefor.
"Collateral" shall mean all of the Collateral as defined in each of
the Security Documents.
"Collateral Agent" shall mean the Agent acting as collateral agent for
the Secured Creditors.
"Collective Bargaining Agreements" shall have the meaning provided in
Section 5.12.
"Commitment Fee" shall have the meaning provided in Section 3.01(a).
"Common Equity Financing Documents" shall mean all of the agreements
and documents governing, or relating to, the Common Equity Issuance.
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"Common Equity Issuance" shall have the meaning provided in Section
5.08(b)
"Company" shall mean any corporation, limited liability company,
partnership or other business entity (or the adjectival form thereof, where
appropriate).
"Consolidated Current Assets" shall mean, at any time, the current
assets (other than cash, Cash Equivalents and deferred income taxes to the
extent included in current assets) of the Borrower and its Subsidiaries at such
time determined on a consol idated basis.
"Consolidated Current Liabilities" shall mean, at any time, the
current liabil ities of the Borrower and its Subsidiaries determined on a
consolidated basis, but excluding deferred income taxes, restructuring costs or
reserves, litigation costs or reserves and the current portion of and accrued
but unpaid interest on any Indebtedness under this Agreement and any other long-
term Indebtedness which would otherwise be included therein.
"Consolidated Debt" shall mean, at any time, the sum of (without
duplica tion) (i) all Indebtedness of the Borrower and its Subsidiaries as would
be required to be reflected on the liability side of a balance sheet of such
Person in accordance with GAAP as determined on a consolidated basis, (ii) all
Indebtedness of the Borrower and its Subsidiaries of the type described in
clauses (iii) and (vii) of the definition of Indebtedness and (iii) all
Contingent Obligations of the Borrower and its Subsidiaries in respect of
Indebtedness of other Persons of the type referred to in preceding clauses (i)
and (ii) of this definition; provided, that for purposes of this definition, (i)
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the amount of Indebtedness in respect of Interest Rate Protection Agreements
shall be at any time the unrealized net loss position, if any, of the Borrower
and/or its Subsidiaries thereunder on a marked-to-market basis determined no
more than one month prior to such time, (ii) any Disqualified Preferred Stock of
the Borrower and any Preferred Stock of any of its Subsidiaries shall be treated
as Indebtedness, with an amount equal to the greater of the liquidation
preference or the maximum fixed repurchase price of any such outstanding
Preferred Stock deemed to be a component of Consolidated Debt and (iii) without
duplication of amounts already included in Consolidated Debt, Consolidated Debt
at any time shall be adjusted by adding thereto the amount of Total Non-
Consolidated Joint Venture Debt at such time.
"Consolidated EBIT" shall mean, for any period, the Consolidated Net
Income of the Borrower and its Subsidiaries, determined on a consolidated basis,
before Consolidated Interest Expense (to the extent deducted in arriving at
Consolidated Net Income) and provision for taxes based on income or gains or
losses from sales of assets other than inventory sold in the ordinary course of
business, in each case that were included in arriving at Consolidated Net
Income.
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"Consolidated EBITDA" shall mean, for any period, Consolidated EBIT,
adjusted by adding thereto the amount of (i) all amortization and depreciation
and other non-cash items and (ii) any management fees and consulting fees paid
pursuant to, and in accordance with the requirements of, clauses (iii) and (vi)
of Section 9.07 during such period, in each case that were deducted in arriving
at Consolidated EBIT for such period; provided that (x) without duplication of
--------
amounts already included in Consolidated EBITDA, Consolidated EBITDA for any
period shall be adjusted by adding thereto the amount of Total Non-Consolidated
Joint Venture EBITDA for the respective period and (y) for purposes of any
determination of compliance with the financial covenants contained in Sections
9.08 through 9.11, inclusive, or any determination of the Adjusted Total
Leverage Ratio, the Adjusted Senior Leverage Ratio or the Total Leverage Ratio
elsewhere in this Agreement, Consolidated EBITDA for any Test Period shall mean
the product of (x) Consolidated EBITDA for the two most recent fiscal quarters
ended during such Test Period multiplied by (y) 2.
"Consolidated Fixed Charge Coverage Ratio" for any period shall mean
the ratio of (x) Consolidated EBITDA (determined after giving effect to the
proviso to the definition thereof) for such period to (y) Consolidated Fixed
Charges for such period.
"Consolidated Fixed Charges" for any period shall mean the sum,
without duplication, of (i) Consolidated Interest Expense for such period, (ii)
the amount of all Capital Expenditures made by the Borrower and its Subsidiaries
during such period (other than Capital Expenditures made with the proceeds or
credits from equipment exchanges, asset sales or insurance proceeds from any
Recovery Event to the extent such proceeds are not required to be applied by the
Borrower as a mandatory repayment pursuant to Section 4.02(c) or (f), as the
case may be) and (iii) the scheduled principal amount of all amorti zation
payments on all Indebtedness (excluding payments pursuant to the Refinancing and
the principal component of any Capitalized Lease Obligation to the extent the
Capital Expenditures financed pursuant to such Capitalized Lease Obligation were
made after the Initial Borrowing Date and were included in the determination of
Consolidated Fixed Charges in a prior period) of the Borrower and its
Subsidiaries for such period (as determined on the first day of the respective
period).
"Consolidated Interest Coverage Ratio" for any period shall mean the
ratio of Consolidated EBITDA (determined after giving effect to the proviso to
the definition thereof) to Consolidated Interest Expense for such period.
"Consolidated Interest Expense" shall mean, for any period, the total
consol idated interest expense of the Borrower and its Subsidiaries for such
period (calculated without regard to any limitations on the payment thereof)
plus, without duplication, (i) that portion of Capitalized Lease Obligations of
the Borrower and its Subsidiaries representing the interest factor for such
period, and capitalized interest expense, plus (ii) the product of
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(x) the amount of all cash Dividend requirements (whether or not declared or
paid) on Disqualified Preferred Stock of the Borrower and on any Preferred Stock
of any of its Subsidiaries paid, accrued or scheduled to paid or accrued during
such period multiplied by (y) a fraction, the numerator of which is one and the
denominator of which is one minus the then current effective consolidated
Federal, state, local and foreign tax rate (expressed as a decimal number
between one and zero) of the Borrower as reflected in the audited consolidated
financial statements of the Borrower for its most recently completed fiscal
year, which amounts described in preceding clause (ii) shall be treated as
interest expense of the Borrower and its Subsidiaries for purposes of this
definition regardless of the treatment of such amounts under GAAP, in each case
net of the total consolidated cash interest income of the Borrower and its
Subsidiaries for such period, but excluding the amortization of any deferred
financing costs or of any costs in respect of any Interest Rate Protection
Agreement. Notwithstanding anything to the contrary contained above, to the
extent Consolidated Interest Expense is to be determined for any Test Period
which ends prior to the first anniversary of the Initial Borrowing Date,
Consolidated Interest Expense for all portions of such period occurring prior to
the Initial Borrowing Date shall be calculated in accordance with the definition
of Test Period contained herein.
"Consolidated Net Income" shall mean, for any period, the net after
tax income of the Borrower and its Subsidiaries determined on a consolidated
basis, without giving effect to any extraordinary or non-recurring gains or
losses to the extent not related to the operations of the Borrower and its
Subsidiaries, any other non-cash expenses incurred or payments made in
connection with the Transaction, and without giving effect to gains and losses
from the sale or disposition of assets (other than sales or dispositions of
inventory, equipment, raw materials and supplies) by the Borrower and its
Subsidiaries; provided that the following items shall be excluded in computing
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Consolidated Net Income (without duplication): (i) the net income or net losses
of any Person in which any Person or Persons other than the Borrower and its
Wholly-Owned Subsidiaries has an equity interest or interests, to the extent of
such equity interests held by Persons other than the Borrower and its Wholly-
Owned Subsidiaries in such Person, (ii) except for determinations expressly
required to be made on a Pro Forma Basis, the net income (or loss) of any Person
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accrued prior to the date it becomes a Wholly-Owned Subsidiary or all or
substantially all of the property or assets of such Person are acquired by a
Wholly-Owned Subsidiary and (iii) the net income of any Subsidiary to the extent
that the declaration or payment of dividends or similar distributions by such
Subsidiary of such net income is not at the time permitted by the operation of
the terms of its charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to such Subsidiary.
"Consolidated Senior Debt" shall mean at any time (x) Consolidated
Debt less (y) the sum of (i) the aggregate outstanding principal amount of the
Senior Subordinated Notes at such time and (ii) the aggregate principal amount
of all other
-103-
subordinated debt incurred pursuant to Sections 9.04(f) and (j) and outstanding
at such time and otherwise included in Consolidated Debt.
"Consolidated Subsidiary" shall mean each Subsidiary of the Borrower
the financial results of which are consolidated with those of the Borrower, in
accordance with GAAP, for financial reporting purposes.
"Contingent Obligations" shall mean as to any Person any obligation of
such Person guaranteeing or intended to guarantee any Indebtedness, leases,
dividends or other obligations ("primary obligations") of any other Person (the
"primary obligor") in any man ner, whether directly or indirectly, including,
without limitation, any obligation of such Person, whether or not contingent,
(a) to purchase any such primary obligation or any prop erty constituting direct
or indirect security therefor, (b) to advance or supply funds (x) for the
purchase or payment of any such primary obligation or (y) to maintain working
capital or equity capital of the primary obligor or otherwise to maintain the
net worth or solvency of the primary obligor, (c) to purchase property,
securities or services primarily for the purpose of assuring the owner of any
such primary obligation of the ability of the primary obligor to make payment of
such primary obligation or (d) otherwise to assure or hold harmless the owner of
such primary obligation against loss in respect thereof; provided, however, that
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the term Contingent Obligation shall not include endorsements of instruments for
deposit or collection or standard contractual indemnities entered into, in each
case in the ordinary course of business. The amount of any Contingent
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Contingent Obligation
is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder) as determined by such Person in good faith.
"Continuing Directors" shall mean the directors of the Borrower on the
Effective Date and each other director if such director's nomination for the
election to the Board of Directors of the Borrower is recommended by a majority
of the then Continuing Directors.
"Credit Documents" shall mean this Agreement, the Notes, the
Subsidiaries Guaranty and each Security Document.
"Credit Event" shall mean the making of a Loan (other than a Revolving
Loan made pursuant to a Mandatory Borrowing) or the issuance of a Letter of
Credit.
"Credit Party" shall mean the Borrower and each Subsidiary Guarantor.
"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
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"Defaulting Bank" shall mean any Bank with respect to which a Bank
Default is in effect.
"Disqualified Preferred Stock" shall mean any Preferred Stock of the
Borrower other than Qualified Preferred Stock.
"Dividend" shall have the meaning provided in Section 9.06.
"Documents" shall mean and include (i) the Credit Documents, (ii) the
Common Equity Financing Documents, (iii) the Senior Subordinated Notes
Documents, (iv) the Recapitalization Documents, (v) the PIK Preferred Stock
Documents, (vi) the Refinancing Documents and (vii) all other documents,
agreements and instruments executed in connection with the Transaction.
"Domestic Subsidiary" shall mean each Subsidiary of the Borrower
incorporated or organized in the United States or any State or territory
thereof.
"Effective Date" shall have the meaning provided in Section 13.10.
"Eligible Transferee" shall mean and include a commercial bank, mutual
fund, financial institution, a "qualified institutional buyer" (as defined in
Rule 144A of the Securities Act), any fund that invests in bank loans or any
other "accredited investor" (as defined in Regulation D of the Securities Act)
(other than an individual).
"Employee Benefit Plans" shall have the meaning set forth in Section
5.12.
"Employment Agreements" shall have the meaning set forth in Section
5.12.
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
notices of non-compliance or violation, investigations or proceedings relating
in any way to any violation (or alleged violation) by the Borrower or any of its
Subsidiaries under any Environmental Law (hereafter "Claims") or any permit
issued to the Borrower or any of its Subsidiaries under any such law, including,
without limitation, (a) any and all Claims by governmental or regulatory
authorities for enforcement, cleanup, removal, response, remedial or other
actions or damages pursuant to any applicable Environmental Law, and (b) any and
all Claims by any third party seeking damages, contribution, indemnification,
cost recovery, compensation or injunctive relief resulting from Hazardous
Materials or arising from alleged injury or threat of injury to health, safety
or the environment.
"Environmental Law" shall mean any federal, state or local policy,
statute, law, rule, regulation, ordinance, code or rule of common law now or
hereafter in effect and
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in each case as amended, and any judicial or administrative interpretation
thereof, including any judicial or administrative order, consent, decree or
judgment (for purposes of this definition (collectively, "Laws")), relating to
the environment, or Hazardous Materials or health and safety to the extent such
health and safety issues arise under the Occupational Safety and Health Act of
1970, as amended, or any such similar Laws.
"Equity Investors" shall mean and include (i) the Apollo Group and
(ii) the Management Participants.
"Equity Retention" shall have the meaning provided in Section 5.08(a).
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued there under. Section references to ERISA are to ERISA, as in effect at
the date of this Agreement and any subsequent provisions of ERISA, amendatory
thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in Section 3(9)
of ERISA) which together with the Borrower or a Subsidiary of the Borrower would
be deemed to be a "single employer" (i) within the meaning of Section 414(b),
(c), (m) or (o) of the Code or (ii) as a result of the Borrower or a Subsidiary
of the Borrower being or having been a general partner of such person.
"Eurodollar Loans" shall mean each Loan bearing interest at the rates
provided in Section 1.08(b).
"Eurodollar Rate" shall mean with respect to each Interest Period for
a Eurodollar Loan, (i) the arithmetic average (rounded to the nearest 1/100 of
1%) of the offered quotation to first-class banks in the interbank Eurodollar
market by BTCo for U.S. dollar deposits of amounts in same day funds comparable
to the outstanding principal amount of the Eurodollar Loan of BTCo for which an
interest rate is then being determined with maturities comparable to the
Interest Period to be applicable to such Eurodollar Loan, determined as of 10:00
A.M. (New York time) on the date which is two Business Days prior to the
commencement of such Interest Period divided (and rounded upward to the next
whole multiple of 1/16 of 1%) by (ii) a percentage equal to 100% minus the then
stated maximum rate of all reserve requirements (including, without limitation,
any marginal, emergency, supplemental, special or other reserves) applicable to
any member bank of the Federal Reserve System in respect of Eurocurrency
liabilities as defined in Regulation D (or any successor category of liabilities
under Regulation D).
"Event of Default" shall have the meaning provided in Section 10.
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"Excess Cash Flow" shall mean, for any period, the remainder of (a)
the sum of (i) Adjusted Consolidated Net Income for such period, (ii) without
duplication of amounts already included in Adjusted Consolidated Net Income, the
Total Non-Consolidated Joint Venture EBITDA for such period and (iii) the
decrease, if any, in Adjusted Consolidated Working Capital from the first day to
the last day of such period, minus (b) the sum of (i) the amount of Capital
Expenditures made by the Borrower and its Subsid iaries on a consolidated basis
during such period, except to the extent financed with the proceeds of
Indebtedness (other than the proceeds of Revolving Loans) or pursuant to
Capitalized Lease Obligations or with proceeds of asset sales, asset trade-ins
or insurance, (ii) the aggregate amount of permanent principal payments of
Indebtedness for borrowed money of the Borrower and its Subsidiaries and the
permanent repayment of the principal component of Capitalized Lease Obligations
of the Borrower and its Subsidiaries (excluding (1) payments pursuant to the
Refinancing, (2) payments with proceeds of asset sales, (3) payments with the
proceeds of Indebtedness or equity and (4) payments of Loans or other
Obligations) during such period and (iii) the increase, if any, in Adjusted
Consolidated Working Capital from the first day to the last day of such period.
"Excess Cash Flow Payment Date" shall mean the date occurring 120 days
after the last day of a fiscal year of the Borrower (commencing with the fiscal
year ending on December 31, 1998).
"Excess Cash Flow Payment Period" shall mean, with respect to the
repayment required on each Excess Cash Flow Payment Date, the immediately
preceding fiscal year of the Borrower.
"Existing Alliance Credit Agreement" shall mean the Credit Agreement,
dated as of __________, among the Borrower, _________________ and __________, as
in effect on the Initial Borrowing Date.
"Existing Indebtedness" shall have the meaning provided in Section
5.09(c).
"Existing Indebtedness Agreements" shall have the meaning provided in
Section 5.12.
"Facing Fee" shall have the meaning provided in Section 3.01(c).
"Federal Funds Rate" shall mean, for any period, a fluctuating
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the
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quotations for such day on such transactions received by the Agent from three
Federal Funds brokers of recognized standing selected by the Agent.
"Fees" shall mean all amounts payable pursuant to, or referred to in,
Section 3.01.
"Final Maturity Date" shall mean December 18, 2003.
"Foreign Subsidiary" shall mean each Subsidiary of the Borrower other
than a Domestic Subsidiary.
"GAAP" shall mean generally accepted accounting principles in the
United States of America as in effect from time to time; it being understood and
agreed that deter minations in accordance with GAAP for purposes of Section 9,
including defined terms as used therein, are subject (to the extent provided
therein) to Section 13.07(a).
"Hazardous Materials" shall mean (a) any petrochemical or petroleum
products, radioactive materials, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation, transformers or other equipment that
contain dielectric fluid containing levels of polychlorinated biphenyls, and
radon gas; and (b) any chemicals, materials or substances defined as or included
in the definition of "hazardous substances," "hazardous wastes," "hazardous
materials," "restricted hazardous materials," "extremely hazardous wastes,"
"restrictive hazardous wastes," "toxic substances," "toxic pollutants,"
"contaminants" or "pollutants," or words of similar meaning and regulatory
effect.
"Healthcare Unit" shall mean any of the following: (i) a magnetic
resonance imaging machine, (ii) a computer assisted tomography machine (CAT
Scanner), (iii) a SPECT machine, (iv) a lithotripsy machine and (v) any other
similar healthcare or diagnostic device used in connection with a Permitted
Business, together with any computer and all attachments, software and related
equipment (including any related vehicles, buildings or leasehold improvements)
required in connection with the operation, transport, housing or storage of any
of the foregoing.
"Healthcare Unit Replacement" shall mean the exchange, sale or other
disposition of a Healthcare Unit, which, in the reasonable opinion of the
Borrower, is obsolete, uneconomic, or no longer useful in the conduct of the
Borrower's or any of its Subsidiaries' business or otherwise requires upgrading,
the purpose of which exchange, sale or other disposition is to acquire (and has
resulted within 180 days prior to such exchange, sale or disposition, or will
result within 180 days following such exchange, sale or disposition, in the
acquisition of) a replacement Healthcare Unit.
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"Indebtedness" of any Person shall mean, without duplication, (i) all
indebtedness of such Person for borrowed money, (ii) the deferred purchase price
of assets or services payable to the sellers thereof or any of such seller's
assignees which in accordance with GAAP would be shown on the liability side of
the balance sheet of such Person but excluding deferred rent as determined in
accordance with GAAP, (iii) the face amount of all letters of credit issued for
the account of such Person and, without duplica tion, all drafts drawn
thereunder, (iv) all Indebtedness of a second Person secured by any Lien on any
property owned by such first Person, whether or not such Indebtedness has been
assumed, (v) all Capitalized Lease Obligations of such Person, (vi) all
obligations of such Person to pay a specified purchase price for goods or
services whether or not deliv ered or accepted, i.e., take-or-pay and similar
----
obligations, (vii) all obligations under Interest Rate Protection Agreements and
Other Hedging Agreements and (viii) all Contingent Obligations of such Person,
provided, that Indebtedness shall not include trade payables and accrued
--------
expenses, in each case arising in the ordinary course of business.
"Initial Borrowing Date" shall mean the date upon which the initial
Borrowing of Loans occurs.
"Intercompany Loan" shall have the meaning provided in Section
9.05(f).
"Intercompany Notes" shall mean promissory notes, in the form of
Exhibit M, evidencing Intercompany Loans.
"Interest Determination Date" shall mean, with respect to any
Eurodollar Loan, the second Business Day prior to the commencement of any
Interest Period relating to such Eurodollar Loan.
"Interest Period," with respect to any Eurodollar Loan, shall mean the
interest period applicable thereto, as determined pursuant to Section 1.09.
"Interest Rate Protection Agreement" shall mean any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement, interest
rate hedging agreement or other similar agreement or arrangement.
"Interest Reduction Discount" shall mean initially zero; provided,
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that from and after the first day of any Margin Reduction Period (the "Start
Date") occurring after the last day of the first fiscal quarter of the Borrower
ended after the Initial Borrowing Date to and including the last day of such
Margin Reduction Period (the "End Date"), the Interest Reduction Discount shall
be (1) for all purposes of determining interest with respect to Revolving Loans
and Swingline Loans, the respective percentage per annum set forth in clause
(A), (B), (C), (D), (E) or (F) below if, but only if, as of the last day of the
most recent fiscal quarter or year, as the case may be, of the Borrower ended
immediately prior
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to such Start Date (the "Test Date") the conditions in clause (A), (B), (C),
(D), (E) or (F) below are met:
(A) 1/4 of 1% if, but only if, as of the Test Date for such Start Date
the Total Leverage Ratio for the Test Period ended on such Test Date shall
be less than 4.50:1.00 and the conditions set forth in none of clauses (B),
(C), (D), (E) and (F) below are satisfied;
(B) 3/8 of 1% if, but only if, as of the Test Date for such Start Date
the Total Leverage Ratio for the Test Period ended on such Test Date shall
be less than 4.25:1.00 and the conditions set forth in none of clauses (C),
(D), (E) and (F) below are satisfied;
(C) 1/2 of 1% if, but only if, as of the Test Date for such Start Date
the Total Leverage Ratio for the Test Period ended on such Test Date shall
be less than 4.00:1.00 and the conditions set forth in none of clauses (D),
(E) and (F) below are satisfied;
(D) 3/4 of 1% if, but only if, as of the Test Date for such Start Date
the Total Leverage Ratio for the Test Period ended on such Test Date shall
be less than 3.50:1.00 and the conditions set forth in neither clause (E)
nor (F) below are satisfied;
(E) 1% if, but only if, as of the Test Date for such Start Date the
Total Leverage Ratio for the Test Period ended on such Test Date shall be
less than 3.00:1.00 and the conditions set forth in clause (F) below are
not satisfied; or
(F) 1-1/4% if, but only if, as of the Test Date for such Start Date the
Total Leverage Ratio for the Test Period ended on such Test Date shall be
less than or equal to 2.50:1.00,
or (2) for all purposes of determining interest with respect to Term Loans, 1/4%
of 1% if, but only if, as of the Test Date most recently ended prior to such
Start Date, the Total Leverage Ratio for the Test Period ended on such Test Date
shall be less than 4.00:1.00.
The Total Leverage Ratio shall be determined for the relevant Test Period, in
each case taken as one accounting period, by delivery of an officer's
certificate of the Borrower to the Banks pursuant to Section 8.01(e) (or in the
case of the Test Period ended December 31, 1997, the IRD Eligibility
Certificate), which certificate shall set forth the calculation of the Total
Leverage Ratio and the Interest Reduction Discount which shall thereafter be
applicable (until the same is changed or ceases to apply in accordance with the
following sentences). The Interest Reduction Discount so determined shall
apply, except as set forth
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below, from the date on which such officer's certificate is delivered to the
Agent to the earlier of (x) the date on which the next certificate is delivered
to the Agent pursuant to Section 8.01(e) and (y) the 45th day following the
first day of the fiscal quarter immediately following the delivery of such
certificate to the Agent. Notwithstanding anything to the contrary contained
above, the Interest Reduction Discount shall be zero if no such officer's
certificate has been delivered to the Banks which sets forth the Total Leverage
Ratio for the relevant Test Period or the financial statements upon which any
such calculations are based have not been delivered, until such a certificate
and/or financial statements are delivered. Notwithstanding anything to the
contrary above in this definition, the Interest Reduction Discount shall be zero
at all times when there shall exist a Default or Event of Default. It is
understood and agreed that the Interest Reduction Discount as provided above
shall in no event be cumulative and only the Interest Reduction Discount
available pursuant to (x) in the case of Revolving Loans and Swingline Loans,
clause (1)(A), (B), (C), (D), (E), or (F) if any, contained in this definition
shall be applicable or (y) in the case of Term Loans, clause (2) contained in
this definition shall be applicable.
"Investment" shall have the meaning provided in the preamble to Section
9.05.
"IRD Eligibility Certificate" shall mean a certificate of the chief
financial officer or other Authorized Officer of the Borrower to the effect that
no Default or Event of Default exists, which certificate shall (i) be delivered
solely in respect of the fiscal year of the Borrower ended December 31, 1997,
(ii) set forth the calculations required to establish compliance with the
provisions of Sections 3.03, 9.02, 9.04(d), (g) and (j) and 9.05 (a), (g), (l)
and (m) and 9.08 through and including 9.11 as at the end of such fiscal year
and (iii) the calculation of the Total Leverage Ratio, the Adjusted Total
Leverage Ratio and the Adjusted Senior Leverage Ratio as at the last day of the
Test Period most recently ended.
"Joint Venture" shall mean any Person, other than an individual or a
Wholly-Owned Subsidiary of the Borrower, (i) in which the Borrower or a
Subsidiary of the Borrower holds or acquires an ownership interest (whether by
way of capital stock, partnership or limited liability company interest, or
other evidence of ownership) and (ii) which is engaged in a Permitted Business.
"L/C Supportable Indebtedness" shall mean (i) obligations of the
Borrower or its Wholly-Owned Subsidiaries incurred in the ordinary course of
business with respect to insurance obligations and workers' compensation, surety
bonds and other similar statutory obligations and (ii) such other obligations of
the Borrower or any of its Wholly-Owned Subsidiaries as are reasonably
acceptable to the Agent and the Letter of Credit Issuer and otherwise permitted
to exist pursuant to the terms of this Agreement.
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"Leasehold" of any Person shall mean all of the right, title and
interest of such Person as lessee or licensee in, to and under leases or
licenses of land, improvements and/or fixtures.
"Letter of Credit" shall have the meaning provided in Section 2.01(a).
"Letter of Credit Fees" shall have the meaning provided in Section
3.01(b).
"Letter of Credit Issuer" shall mean BTCo and any other Bank which, at
the request of the Borrower and with the consent of the Agent, agrees in such
Bank's sole discretion to become a Letter of Credit Issuer for purposes of
issuing Letters of Credit pursuant to Section 2. The sole Letter of Credit
Issuer on the Initial Borrowing Date is BTCo.
"Letter of Credit Outstandings" shall mean, at any time, the sum of,
without duplication, (i) the aggregate Stated Amount of all outstanding Letters
of Credit and (ii) the aggregate amount of all Unpaid Drawings in respect of all
Letters of Credit.
"Letter of Credit Request" shall have the meaning provided in Section
2.02(a).
"Lien" shall mean any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any agreement to give any of the
foregoing, any conditional sale or other title retention agreement, any
financing or similar statement or notice filed under the UCC or any similar
recording or notice statute, and any lease having substantially the same effect
as the foregoing).
"Loan" shall mean each Term Loan, each Revolving Loan and each Swingline
Loan.
"Management Agreements" shall have the meaning provided in Section 5.12.
"Management Participants" shall mean certain members of management of
the Borrower previously identified and satisfactory to the Agent.
"Mandatory Borrowing" shall have the meaning provided in Section
1.01(d).
"Margin Reduction Period" shall mean each period which shall commence on
a date on which the financial statements are delivered pursuant to Section
8.01(b) or (c) (or the date of the delivery of the IRD Eligibility Certificate,
if applicable), as the case may be, and which shall end on the earlier of (i)
the date of actual delivery of the next financial statements pursuant to Section
8.01(b) or (c), as the case may be, (but excluding the delivery of the financial
statements delivered pursuant to Section 9.01(c) for the fiscal year
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ended December 31, 1997, in the event the IRD Eligibility Certificate has been
delivered to the Banks) and (ii) the latest date on which the next financial
statements are required to be delivered pursuant to Section 8.01(b) or (c), as
the case may be, (or the date occurring 45 days after the close of the first
quarterly accounting period in the fiscal year of the Borrower ended December
31, 1998) it being understood that the first Margin Reduction Period shall
commence on the earlier of (x) the date of the delivery of the IRD Eligibility
Certificate and (y) the date of delivery of the first set of financial
statements pursuant to Section 8.01(b) after the Initial Borrowing Date.
"Margin Stock" shall have the meaning provided in Regulation U.
"Material Adverse Effect" shall mean a material adverse effect on the
business, properties, assets, liabilities, condition (financial or otherwise) or
prospects of the Borrower or the Borrower and its Subsidiaries taken as a whole.
"Material Contracts" shall have the meaning provided in Section 5.12.
"Maturity Date", with respect to any Tranche of Loans, shall mean the
Final Maturity Date or the Revolving Loan Maturity Date, as the case may be.
"Maximum Permitted Acquisition Leverage Ratio" shall mean, at any time,
the maximum Adjusted Leverage Ratio which may exist pursuant to Section 9.11
without giving rise to a Default or Event of Default at such time, adjusted by
reducing the ratio appearing in such maximum Adjusted Leverage Ratio by 0.25.
"Maximum Swingline Amount" shall mean $2,500,000.
"Minimum Borrowing Amount" shall mean (i) for Revolving Loans,
$1,000,000, (ii) for Term Loans, $5,000,000, and (iii) for Swingline Loans,
$500,000.
"Moody's" shall mean Xxxxx'x Investors Service, Inc.
"Net Cash Proceeds" shall mean for any event requiring a reduction of
the Total Revolving Loan Commitment and/or repayment of Term Loans pursuant to
Section 3.03 or 4.02, as the case may be, the gross cash proceeds (including any
cash received by way of deferred payment pursuant to a promissory note,
receivable or otherwise, but only as and when received) received from such
event, net of reasonable transaction costs (including, as applicable, any
underwriting, brokerage or other customary commissions and reasonable legal,
advisory and other fees and expenses associated therewith) received from any
such event.
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"Net Sale Proceeds" shall mean for any sale of assets, the gross cash
proceeds (including any cash received by way of deferred payment pursuant to a
promissory note, receivable or otherwise, but only as and when received)
received from any sale of assets, net of (i) reasonable transaction costs
(including, without limitation, any underwriting, brok erage or other customary
selling commissions and reasonable legal, advisory and other fees and expenses,
including title and recording expenses, associated therewith) and payments of
unassumed liabilities relating to the assets sold at the time of, or within 30
days after, the date of such sale, (ii) the amount of such gross cash proceeds
required to be used to repay any Indebtedness (other than Indebtedness of the
Banks pursuant to this Agreement) which is secured by the respective assets
which were sold, and (iii) the estimated marginal increase in income taxes which
will be payable by the Borrower's consolidated group with respect to the fiscal
year in which the sale occurs as a result of such sale; provided, however, that
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such gross proceeds shall not include any portion of such gross cash proceeds
which the Borrower determines in good faith should be reserved for post-closing
adjustments (including indemnification payments) (to the extent the Borrower
delivers to the Banks a certificate signed by its chief financial officer or
treasurer, controller or chief accounting officer as to such determination), it
being understood and agreed that on the day that all such post-closing
adjustments have been determined (which shall not be later than six months
following the date of the respective asset sale), the amount (if any) by which
the reserved amount in respect of such sale or disposition exceeds the actual
post-closing adjustments payable by the Borrower or any of its Subsidiaries
shall constitute Net Sale Proceeds on such date received by the Borrower and/or
any of its Subsidiaries from such sale, lease, transfer or other disposition.
The parties hereto acknowledge and agree that Net Sale Proceeds shall not
include any trade-in-credits or purchase price reductions received by the
Borrower or any of its Subsidiaries in connection with an exchange of equipment
for replacement equipment that is the functional equivalent of such exchanged
equipment.
"Newport" shall mean Newport Investment LLC, a Delaware limited
liability company.
"Non-Consolidated Joint Venture" shall mean any Joint Venture which is
not a Consolidated Subsidiary of the Borrower.
"Non-Consolidated Joint Venture Debt" shall mean, for each Non-
Consolidated Joint Venture at any time, the Proportionate Share of the increase
(or decrease) to Consolidated Debt at such time which would have resulted if the
respective Joint Venture had instead been a Wholly-Owned Subsidiary of the
Borrower at such time.
"Non-Consolidated Joint Venture EBITDA" shall mean, for each Non-
Consolidated Joint Venture for any period, the Proportionate Share of the
increase (or decrease) to Consolidated EBITDA for such period which would have
occurred if the
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respective Joint Venture had instead been a Wholly-Owned Subsidiary of the
Borrower during such period (or, if shorter, that portion of such period during
which the respective Non-Consolidated Joint Venture was a Non-Consolidated Joint
Venture). Notwithstanding anything to the contrary contained above, for
purposes of any determination of Non-Consolidated Joint Venture EBITDA used in a
computation of Total Non-Consolidated Joint Venture EBITDA for purposes of the
definition of Excess Cash Flow, (A) if Non-Consolidated Joint Venture EBITDA for
the respective period, as determined pursuant to the immediately preceding
sentence, is positive, the amount thereof for such purposes shall be limited to
the lesser of (x) the amount determined pursuant to the immediately preceding
sentence and (y) the amount of cash actually distributed during the respective
period by such Non-Consolidated Joint Venture to the Borrower or its Wholly-
Owned Subsidiaries and (B) if Non-Consolidated Joint Venture EBITDA for the
respective period is negative, such negative amount shall be included for such
purposes, but only to the extent the aggregate of all negative amounts so
included (for the respective period and all prior periods occurring after the
Initial Borrowing Date) does not exceed the aggregate amount theretofore
invested by the Borrower and its Subsidiaries in the respective Non-Consolidated
Joint Venture; provided that preceding clause (B) shall not be applicable to any
Non-Consolidated Joint Venture acquired pursuant to a Permitted Acquisition.
"Non-Defaulting Bank" shall mean each Bank other than a Defaulting Bank.
"Non-Subsidiary Joint Venture" shall mean each Joint Venture which is
not a Subsidiary of the Borrower.
"Non-Wholly Owned Entity" shall have the meaning provided in the
definition of Permitted Acquisition.
"Note" shall mean each Term Note, each Revolving Note and the Swingline
Note.
"Notice of Borrowing" shall have the meaning provided in Section
1.03(a).
"Notice of Conversion" shall have the meaning provided in Section 1.06.
"Notice Office" shall mean the office of the Agent located at Xxx
Xxxxxxx Xxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 or such other office as the Agent
may designate to the Borrower and the Banks from time to time.
"Obligations" shall mean all amounts, direct or indirect, contingent or
absolute, of every type or description, and at any time existing, owing to the
Agent, the Collateral Agent or any Bank pursuant to the terms of this Agreement
or any other Credit Document.
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"Other Hedging Agreements" shall mean any foreign exchange contracts,
currency swap agreements or other similar agreements or arrangements designed to
protect against fluctuations in currency values.
"Participant" shall have the meaning provided in Section 2.03(a).
"Payment Office" shall mean the office of the Agent located at Xxx
Xxxxxxx Xxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 or such other office as the Agent
may designate to the Borrower and the Banks from time to time.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Section 4002 of ERISA, or any successor thereto.
"Permitted Acquired Debt" shall have the meaning set forth in Section
9.04(d).
"Permitted Acquisition" shall mean the acquisition by the Borrower or
any of its Wholly-Owned Subsidiaries of assets constituting a business, division
or product line of any Person not already a Subsidiary of the Borrower or any of
its Wholly-Owned Subsidiaries or of 100% of the capital stock or other equity
interests of any such Person, which Person shall, as a result of such
acquisition, become a Domestic Subsidiary of the Borrower or such Wholly-Owned
Subsidiary, provided that (A) the consideration paid by the Borrower or such
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Wholly-Owned Subsidiary consists solely of cash (including proceeds of Revolving
Loans), the issuance of the Borrower Common Stock, the issuance of any Qualified
Preferred Stock or Disqualified Preferred Stock otherwise permitted in Section
9.13, the issuance of Indebtedness otherwise permitted in Section 9.04
(including Permitted Subordinated Indebtedness) and the assumption/acquisition
of any Permitted Acquired Debt (calculated in accordance with GAAP) relating to
such business, division, product line or Person which is permitted to remain
outstanding in accordance with the requirements of Section 9.04, (B) in the case
of the acquisition of 100% of the capital stock or other equity interests of any
Person, such Person (the "Acquired Person") shall own no capital stock or other
equity interests of any other Person unless either (x) the Acquired Person owns
100% of the capital stock or other equity interests of such other Person or (y)
if the Acquired Person owns capital stock or equity interests in any other
Person which is not a Wholly-Owned Subsidiary of the Acquired Person (a "Non-
Wholly Owned Entity"), both (1) the Acquired Person shall not have been created
or established in contemplation of, or for purposes of, the respective Permitted
Acquisition and (2) any Non-Wholly Owned Entity of the Acquired Person shall
have been non-wholly-owned prior to the date of the respective Permitted
Acquisition and not created or established in contemplation thereof, (C)
substantially all of the business, division or product line acquired pursuant to
the respective Permitted Acquisition, or the business of the Person acquired
pursuant to the respective Permitted Acquisition and its Subsidiaries taken as a
whole, is in the United States, (D) the assets acquired, or the business of the
Person whose stock is acquired, shall be in a
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Permitted Business and (E) all applicable requirements of Sections 8.14 and 9.02
applicable to Permitted Acquisitions are satisfied. Notwithstanding anything to
the contrary contained in the immediately preceding sentence, an acquisition
which does not otherwise meet the requirements set forth above in the definition
of "Permitted Acquisition" shall constitute a Permitted Acquisition if, and to
the extent, the Required Banks agree in writing that such acquisition shall
constitute a Permitted Acquisition for purposes of this Agreement.
"Permitted Acquisition Additional Cost-Savings" shall mean, in
connection with each Permitted Acquisition, those demonstrable cost-savings
adjustments (in each case not included pursuant to clause (iii) or (iv) of the
definition of Pro Forma Basis contained herein) reasonably anticipated by the
--- -----
Borrower to be achieved in connection with such Permitted Acquisition for the 12
month period following the consummation of such Permitted Acquisition, which
cost-savings adjustments shall be estimated on a good faith basis by the
Borrower and, if requested by the Agent, be verified by a nationally recognized
accounting firm or as otherwise agreed to by the Agent.
"Permitted Business" shall mean the mobile magnetic resonance imaging
business conducted by the Borrower and its Subsidiaries on the Effective Date,
any imaging or other healthcare services business, the provision of services to
hospitals and other healthcare providers and reasonable extensions of the
foregoing.
"Permitted Debt" shall mean and include Permitted Acquired Debt,
Permitted Subordinated Refinancing Indebtedness and Permitted Subordinated
Indebtedness.
"Permitted Encumbrances" shall mean (i) those liens, encumbrances and
other matters affecting title to any Real Property and found reasonably
acceptable by the Agent, (ii) as to any particular Real Property at any time,
such easements, encroachments, covenants, rights of way, minor defects,
irregularities or encumbrances on title which could reasonably be expected to
materially impair such Real Property for the purpose for which it is held by the
mortgagor thereof, or the lien held by the Collateral Agent, (iii) zoning and
other municipal ordinances which are not violated in any material respect by the
existing improvements and the present use made by the mortgagor thereof of the
premises, (iv) general real estate taxes and assessments not yet delinquent, and
(v) such other similar items as the Agent may consent to (such consent not to be
unreasonably withheld).
"Permitted Holders" shall mean Apollo Group and its Affiliates and the
Management Participants.
"Permitted Liens" shall have the meaning provided in Section 9.03.
"Permitted Sale-Leaseback Transaction" shall mean any sale by the
Borrower or any of its Subsidiaries of any Healthcare Unit first acquired by the
Borrower or such
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Subsidiary after the Initial Borrowing Date which Healthcare Unit is then leased
back to the Borrower or such Subsidiary, provided that (i) the proceeds of the
--------
respective sale shall be entirely cash and in an amount at least equal to 85% of
the aggregate amount expended by the Borrower or such Subsidiary in so acquiring
such Healthcare Unit, (ii) such sale and leaseback are effected within 90 days
of the acquisition by the Borrower or such Subsidiary of such Healthcare Unit,
and (iii) the respective transaction is otherwise effected in accordance with
the applicable requirements of Section 9.02(k).
"Permitted Subordinated Indebtedness" shall mean subordinated
Indebtedness of the Borrower incurred in connection with a Permitted Acquisition
and in accordance with Section 8.14, which Permitted Subordinated Indebtedness
and all terms and conditions thereof (including, without limitation, the
maturity thereof, the interest rate applicable thereto, amortization, defaults,
remedies, voting rights, subordination provisions, etc.), and the documentation
therefor, shall be reasonably satisfactory to the Agent, provided, that in any
--------
event, unless the Required Banks otherwise expressly consent in writing prior to
the incurrence thereof, (i) no such Indebtedness shall be guaranteed by the
Borrower or any of its Subsidiaries and (ii) no such Indebtedness shall be
secured by any asset of the Borrower or any of its Subsidiaries. The incurrence
of Permitted Subordinated Indebtedness shall be deemed to be a representation
and warranty by the Borrower that all conditions thereto have been satisfied in
all material respects and that same is permitted in accordance with the terms of
this Agreement, which representation and warranty shall be deemed to be a repre
sentation and warranty for all purposes hereunder, including, without
limitation, Sections 6 and 10.
"Permitted Subordinated Refinancing Indebtedness" shall mean
Indebtedness of the Borrower issued or given in exchange for, or the proceeds of
which are used to refinance, the Senior Subordinated Notes, so long as (a) such
Indebtedness has a weighted average life to maturity greater than or equal to
the weighted average life to maturity of the Senior Subordinated Notes, (b) such
refinancing does not (i) increase the amount of such Indebtedness outstanding
immediately prior to such refinancing or (ii) add guarantors, obligors or
security from that which applied to the Senior Subordinated Notes, (c) such
Indebtedness has substantially the same (or, from the perspective of the Banks,
more favorable) subordination provisions, if any, as applied to the Senior
Subordinated Notes, and (d) all other terms of such refinancing (including,
without limitation, with respect to the amortization schedules, redemption
provisions, maturities, covenants, defaults and remedies), are not, taken as a
whole, materially less favorable to the Borrower than those previously existing
with respect to the Senior Subordinated Notes.
"Person" shall mean any individual, partnership, joint venture, firm,
corpora tion, limited liability company, association, trust or other enterprise
or any government or political subdivision or any agency, department or
instrumentality thereof.
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"PIK Preferred Stock" shall mean the pay-in-kind preferred stock of the
Borrower, $.01 par value per share, issued pursuant to the PIK Preferred Stock
Documents.
"PIK Preferred Stock Documents" shall mean the documents executed and
delivered with respect to the PIK Preferred Stock.
"Plan" shall mean any pension plan as defined in Section 3(2) of ERISA,
which is maintained or contributed to by (or to which there is an obligation to
contribute of) the Borrower or a Subsidiary of the Borrower or an ERISA
Affiliate, and each such plan for the five year period immediately following the
latest date on which the Borrower, or a Subsidiary of the Borrower or an ERISA
Affiliate maintained, contributed to or had an obligation to contribute to such
plan.
"Pledge Agreement" shall have the meaning provided in Section 5.10(a).
"Pledge Agreement Collateral" shall mean all "Collateral" as defined in
the Pledge Agreement.
"Pledged Securities" shall mean all the Pledged Securities as defined in
the Pledge Agreement.
"Preferred Stock," as applied to the capital stock of any Person, means
capital stock of such Person (other than common stock of such Person) of any
class or classes (however designed) that ranks prior, as to the payment of
dividends or as to the distribution of assets upon any voluntary or involuntary
liquidation, dissolution or winding up of such Person, to shares of capital
stock of any other class of such Person, and shall include any Qualified
Preferred Stock and Disqualified Preferred Stock.
"Prime Lending Rate" shall mean the rate which BTCo announces from time
to time as its prime lending rate, the Prime Lending Rate to change when and as
such prime lending rate changes. The Prime Lending Rate is a reference rate and
does not necessarily represent the lowest or best rate actually charged to any
customer. BTCo may make commercial loans or other loans at rates of interest
at, above or below the Prime Lending Rate.
"Pro Forma Balance Sheet" shall have the meaning provided in Section
--- -----
5.15.
"Pro Forma Basis" shall mean, in connection with any calculation of
--- -----
compliance with any financial covenant or financial term, the calculation
thereof after giving effect on a pro forma basis to (w) if the relevant period
to be tested includes any period occurring prior to the Initial Borrowing Date,
the consummation of the Transaction as if same had occurred on the first day of
such period, (x) the incurrence of any
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Indebtedness (other than revolving Indebtedness, except to the extent same is
incurred to finance the Transaction, to refinance other outstanding Indebtedness
or to finance Permitted Acquisitions) or Preferred Stock (other than Qualified
Preferred Stock of the Borrower) after the first day of the relevant Calculation
Period as if such Indebtedness or Preferred Stock had been incurred or issued
(and the proceeds thereof applied) on the first day of the relevant Calculation
Period, (y) the permanent repayment of any Indebtedness (other than revolving
Indebtedness except to the extent paid with Permitted Debt or Disqualified
Preferred Stock) or Preferred Stock (other than Qualified Preferred Stock of the
Borrower) after the first day of the relevant Calculation Period as if such
Indebtedness or Preferred Stock had been retired or redeemed on the first day of
the relevant Calculation Period and (z) the Permitted Acquisition, if any, then
being consummated as well as any other Permitted Acquisition consummated after
the first day of the relevant Calculation Period and on or prior to the date of
the respective Permitted Acquisition then being effected, with the following
rules to apply in connection therewith:
(i) all Indebtedness and Preferred Stock (other than Qualified
Preferred Stock of the Borrower) (x) (other than revolving Indebtedness,
except to the extent same is incurred to finance the Transaction, to
refinance other outstanding Indebtedness, or to finance Permitted
Acquisitions) incurred or issued after the first day of the relevant
Calculation Period (whether incurred to finance a Permitted Acquisition, to
refinance Indebtedness or otherwise) shall be deemed to have been incurred
or issued (and the proceeds thereof applied) on the first day of the
respective Calculation Period and remain outstanding through the date of
determina tion (and thereafter in the case of projections pursuant to
Section 8.14(a)(iv)) and (y) (other than revolving Indebtedness except to
the extent paid with Permitted Debt or Disqualified Preferred Stock)
permanently retired or redeemed after the first day of the relevant
Calculation Period shall be deemed to have been retired or redeemed on the
first day of the respective Calculation Period and remain retired through
the date of determination (and thereafter in the case of projections
pursuant to Section 8.14(a)(iv));
(ii) all Indebtedness or Preferred Stock (other than Qualified
Preferred Stock of the Borrower) assumed to be outstanding pursuant to
preceding clause (i) shall be deemed to have borne interest or accrued
dividends, as the case may be, at (x) the rate applicable thereto, in the
case of fixed rate indebtedness or Preferred Stock or (y) the rates which
would have been applicable thereto during the respective period when same
was deemed outstanding, in the case of floating rate Indebtedness or
Preferred Stock (although interest expense with respect to any Indebtedness
or Preferred Stock for periods while same was actually outstanding during
the respective period shall be calculated using the actual rates applicable
thereto while same was actually outstanding); provided that for purposes of
--------
calculations pursuant to Section 8.14(a)(iv), all Indebtedness or Preferred
Stock
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(whether actually outstanding or deemed outstanding) bearing interest at a
floating rate of interest shall be tested on the basis of the rates
applicable at the time the determination is made pursuant to said
provisions;
(iii) in making any determination of Consolidated EBITDA, pro
---
forma effect shall be given to any Permitted Acquisition consummated after
-----
the first day of the respective period being tested, taking into account,
for any portion of the relevant period being tested occurring prior to the
consummation of such Permitted Acquisition, demonstrable cost savings
actually achieved simultaneously with the closing of the respective
Permitted Acquisition, which cost savings would be permitted to be
recognized in pro forma statements prepared in accordance with Regulation
--- -----
S-X under the Securities Act, as if such cost-savings were realized on the
first day of the relevant period;
(iv) without duplication of adjustments provided above, in case
of any Permitted Acquisition consummated after the first day of the
relevant period being tested, pro forma effect shall be given to the
--- -----
termination or replacement of operating leases with Capitalized Lease
Obligations or other Indebtedness, and to any replacement of Capitalized
Lease Obligations or other Indebtedness with operating leases, in each case
effected at the time of the consummation of such Permitted Acquisition or
thereafter, in each case if effected after the first day of the period
being tested and prior to the date the respective determination is being
made, as if such termination or replacement had occurred on the first day
of the relevant period; and
(v) in making any determination of Consolidated EBITDA for
purposes of any calculation of the Adjusted Total Leverage Ratio or the
Adjusted Senior Leverage Ratio only, (x) for any Permitted Acquisition
which occurred during the last two fiscal quarters comprising the
respective Test Period (and, in the case of Section 8.14, thereafter and on
or prior to the relevant date of determination), there shall be added to
Consolidated EBITDA the amount of Permitted Acquisition Additional Cost
Savings, determined in accordance with the definition thereof contained
herein, expected to be realized with respect to such Permitted Acquisition,
(y) for any Permitted Acquisition effected in the second fiscal quarter of
the respective Test Period (it being understood and agreed that such fiscal
quarter shall not be directly included in the determination of Consolidated
EBITDA, by virtue of the proviso to the definition thereof), the
Consolidated EBITDA shall be increased by 50% of the Permitted Acquisition
Additional Cost Savings estimated to arise in connection with the
respective Permitted Acquisition and (z) for any Permitted Acquisition
effected in the first fiscal quarter of the respective Test Period (it
being understood and agreed that such fiscal quarter will not be directly
included in the determination of Consolidated EBITDA by virtue of the
proviso to the
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definition thereof), the Consolidated EBITDA shall be increased by 25% of
the Permitted Acquisition Additional Cost Savings estimated to arise in
connection with the respective Permitted Acquisition; provided that the
aggregate additions to Consolidated EBITDA, for any period being tested,
pursuant to this clause (v) shall not exceed 15% of the amount which would
have been Consolidated EBITDA in the absence of the adjustment pursuant to
this clause (v).
Notwithstanding anything to the contrary contained above, (x) for purposes of
Sections 9.08, 9.10 and 9.11, and for purposes of all determinations of the
Interest Reduction Discount, pro forma effect (as otherwise provided above)
--- -----
shall only be given for events or occurrences which occurred during the
respective Test Period but not thereafter and (y) for purposes of Section 8.14,
pro forma effect (as otherwise provided above) shall be given for events or
--- -----
occurrences which occurred during the respective Test Period and thereafter but
on or prior to the respective date of determination.
"Projections" shall have the meaning provided in Section 5.15.
"Proportionate Share" shall mean (I) in the case of any determination of
Non-Consolidated Joint Venture EBITDA, with respect to each Non-Consolidated
Joint Venture for any period, the proportion (expressed as a percentage) of the
share of the Borrower and its Wholly-Owned Subsidiaries (whether directly or
indirectly) in the Non-Consolidated Joint Venture EBITDA (for this purpose,
calculated in accordance with the first sentence of the definition thereof as if
the phrase "the Proportionate Share of" appearing therein and the second
sentence of such definition were deleted) of such Non-Consolidated Joint Venture
for such period, which percentage shall be determined giving effect to any
priorities (including, without limitation, repayments of loans to owners of
equity interest in the respective Joint Venture, preferred distribution
priorities, etc.) established by such Non-Consolidated Joint Venture (or the
owners of the equity interests therein) for the allocation of such Non-
Consolidated Joint Venture EBITDA and (II) in the case of any determination of
Non-Consolidated Joint Venture Debt, with respect to each Non-Consolidated Joint
Venture at any time, the proportion (expressed as a percentage) of the share of
the Borrower and its Wholly-Owned Subsidiaries (whether directly or indirectly)
in the Non-Consolidated Joint Venture Debt (for this purpose, calculated in
accordance with the first sentence of the definition thereof as if the phrase
"the Proportionate Share of" appearing therein and the second sentence of such
definition were deleted) of such Non-Consolidated Joint Venture at such time.
"Qualified IPO" shall mean an underwritten public offering of Borrower
Common Stock which generates cash proceeds of at least $30,000,000.
"Qualified Preferred Stock" shall mean any Preferred Stock of the
Borrower, the express terms of which shall provide that dividends thereon shall
not be required to be
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paid at any time (and to the extent) that such payment would be prohibited by
the terms of this Agreement or any other agreement of the Borrower relating to
outstanding indebtedness and which, by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable), or upon
the happening of any event (including any Change of Control Event), cannot
mature (excluding any maturity as the result of an optional redemp tion by the
issuer thereof) and is not mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, and is not redeemable, or required to be repurchased,
at the sole option of the holder thereof (including, without limitation, upon
the occurrence of a Change of Control Event), in whole or in part, on or prior
to the date occurring two years after the Final Maturity Date.
"Quarterly Payment Date" shall mean the last Business Day of each March,
June, September and December.
"Real Property" of any Person shall mean all of the right, title and
interest of such Person in and to land, improvements and fixtures, including
Leaseholds.
"Recap Distribution" shall have the meaning provided in Section 5.08(a).
"Recapitalization" shall mean and include the Alliance Merger, the
Equity Retention, the Recap Distribution and such other transactions
contemplated by the Recapitalization Documents.
"Recapitalization Documents" shall mean and include (i) the Agreement
and Plan of Merger, dated as of July 23, 1997, among Newport, Acquisition Corp.
and the Borrower, as the same may be amended, modified or supplemented from time
to time pursuant to the terms hereof and thereof and (ii) all other agreements
and documents governing, or relating to, the Recapitalization.
"Recovery Event" shall mean the receipt by the Borrower or any of its
Subsidiaries of any insurance or condemnation proceeds payable (i) by reason of
theft, physical destruction or damage or any other similar event with respect to
any properties or assets of the Borrower or any of its Subsidiaries, (ii) by
reason of any condemnation, taking, seizing or similar event with respect to any
properties or assets of the Borrower or any of its Subsidiaries and (iii) under
any policy of insurance required to be maintained under Section 8.03.
"Refinanced Indebtedness" shall have the meaning provided in Section
5.09(a).
"Refinancing" shall mean the refinancing transactions described in
Section 5.09.
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"Refinancing Documents" shall mean each of the agreements, documents and
instruments entered into in connection with the Refinancing.
"Register" shall have the meaning provided in Section 13.17.
"Regulation D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof establishing reserve requirements.
"Regulation G" shall mean Regulation G of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or any portion thereof.
"Regulation T" shall mean Regulation T of the Board of Governors of the
Federal Reserve System as from to time in effect and any successor to all or any
portion thereof.
"Regulation U" shall mean Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof.
"Regulation X" shall mean Regulation X of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or any portion thereof.
"Release" means disposing, discharging, injecting, spilling, pumping,
leaking, leaching, dumping, emitting, escaping, emptying, seeping, placing,
pouring and the like, into or upon any land or water or air, or otherwise
entering into the environment.
"Replaced Bank" shall have the meaning provided in Section 1.13.
"Replacement Bank" shall have the meaning provided in Section 1.13.
"Reportable Event" shall mean an event described in Section 4043(c) of
ERISA with respect to a Plan that is subject to Title IV of ERISA other than
those events as to which the 30-day notice period is waived under subsection
.22, .23, .25, .27, or .28 of PBGC Regulation Section 4043.
"Required Banks" shall mean Non-Defaulting Banks, the sum of whose
outstanding Term Loans and Revolving Loan Commitments (or after the termination
thereof, outstanding Revolving Loans and Adjusted RL Percentage of Swingline
Loans and Letter of Credit Outstandings) represent an amount greater than 50% of
the sum of all
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outstanding Term Loans of Non-Defaulting Banks and the Adjusted Total Revolving
Loan Commitment (or after the termination thereof, the sum of the then total
outstanding Revolving Loans of Non-Defaulting Banks and the aggregate Adjusted
RL Percentages of all Non-Defaulting Banks of the total outstanding Swingline
Loans and Letter of Credit Outstandings at such time).
"Returns" shall have the meaning provided in Section 7.21.
"Revolving Loan" shall have the meaning provided in Section 1.01(b).
"Revolving Loan Commitment" shall mean, with respect to each RL Bank,
the amount set forth opposite such Bank's name in Schedule I directly below the
column enti tled "Revolving Loan Commitment," as the same may be reduced from
time to time pursuant to Sections 3.02, 3.03, 4.02 and/or Section 10.
"Revolving Loan Maturity Date" shall mean December 18, 2002.
"Revolving Note" shall have the meaning provided in Section 1.05(a).
"RL Bank" shall mean at any time each Bank with a Revolving Loan
Commitment or with outstanding Revolving Loans.
"RL Percentage" of any Bank at any time shall mean a fraction (expressed
as a percentage) the numerator of which is the Revolving Loan Commitment of such
Bank at such time and the denominator of which is the Total Revolving Loan
Commitment at such time, provided that if the RL Percentage of any Bank is to be
--------
determined after the Total Revolving Loan Commitment has been terminated, then
the RL Percentages of the Banks shall be determined immediately prior (and
without giving effect) to such termination.
"S&P" shall mean Standard & Poor's Ratings Services, a division of
McGraw Hill, Inc.
"Scheduled Commitment Reduction" shall have the meaning provided in
Section 3.03(c).
"Scheduled Commitment Reduction Date" shall have the meaning provided in
Section 3.03(c).
"Scheduled Repayment" shall have the meaning provided in Section
4.02(b).
"SEC" shall mean the Securities and Exchange Commission or any successor
thereto.
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"Section 4.04(b)(ii) Certificate" shall have the meaning provided in
Section 4.04(b)(ii).
"Secured Creditors" shall have the meaning provided in the Security
Documents.
"Securities Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
"Security Agreement" shall have the meaning provided in Section 5.10(b).
"Security Agreement Collateral" shall mean all "Collateral" as defined
in the Security Agreement.
"Security Documents" shall mean and include the Security Agreement, the
Pledge Agreement and each Additional Security Document, if any.
"Senior Subordinated Notes" shall mean the Borrower's [__]% Senior
Subordinated Notes due 2005 issued pursuant to the Senior Subordinated Note
Indenture, as in effect on the Effective Date and as the same may be amended,
modified or supplemented from time to time in accordance with the terms hereof
and thereof.
"Senior Subordinated Notes Documents" shall mean the Senior Subordinated
Notes, the Senior Subordinated Notes Indenture and all other documents executed
and delivered with respect to the Senior Subordinated Notes or Senior
Subordinated Notes Indenture, as in effect on the Effective Date and as the same
may be amended, modified or supplemented from time to time in accordance with
the terms hereof and thereof.
"Senior Subordinated Notes Indenture" shall mean the Indenture, dated as
of December ___, 1997, between the Borrower and the Senior Subordinated Note
Indenture Trustee, as in effect on the Effective Date and as thereafter amended
from time to time in accordance with the requirements hereof and thereof.
"Senior Subordinated Notes Indenture Trustee" shall mean
[________________].
"Shareholder Subordinated Note" shall mean an unsecured junior
subordinated note issued by the Borrower (and not guaranteed or supported in any
way by the Borrower or any of its Subsidiaries) in the form of Exhibit N.
"Shareholders' Agreements" shall have the meaning provided in Section
5.12.
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"Standby Letter of Credit" shall have the meaning provided in Section
2.01(a).
"Stated Amount" of each Letter of Credit shall mean the maximum amount
available to be drawn thereunder (regardless of whether any conditions for
drawing could then be met).
"Subsidiaries Guaranty" shall have the meaning provided in Section 5.11.
"Subsidiary" of any Person shall mean and include (i) any corporation
more than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person directly or
indirectly through Subsidiaries and (ii) any partnership, association, joint
venture or other entity (other than a corporation) in which such Person directly
or indirectly through Subsidiaries, has more than a 50% equity interest at the
time.
"Subsidiary Guarantor" shall mean each Subsidiary of the Borrower that
is or becomes a party to the Subsidiaries Guaranty.
"Swingline Expiry Date" shall mean the date which is five Business Days
prior to the Revolving Loan Maturity Date.
"Swingline Loan" shall have the meaning provided in Section 1.01(c).
"Swingline Note" shall have the meaning provided in Section 1.05(a).
"Syndication Date" shall mean that date upon which the Agent determines
(and notifies the Borrower and the Banks) that the primary syndication (and
resultant addition of Persons as Banks pursuant to Section 13.04(b)) has been
completed.
"Tax Allocation Agreements" shall have the meaning provided in Section
5.12.
"Taxes" shall have the meaning provided in Section 4.04(a).
"Term Loan" shall have the meaning provided in Section 1.01(a).
"Term Loan Commitment" shall mean, with respect to each Bank, the amount
set forth opposite such Bank's name in Schedule I directly below the column
entitled "Term Loan Commitment," as the same may be terminated pursuant to
Sections 3.03, 4.02 and/or Section 10.
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"Term Note" shall have the meaning provided in Section 1.05(a).
"Test Period" shall mean each period of four consecutive fiscal quarters
then last ended, in each case taken as one accounting period. Notwithstanding
anything to the contrary contained above or in Section 13.07 or otherwise
required by GAAP, in the case of any Test Period ending prior to the first
anniversary of the Initial Borrowing Date, such period shall be a one-year
period ending on the last day of the fiscal quarter last ended, with any
calculations of Consolidated Interest Expense (but not for purposes of
determining Consolidated EBITDA) required in determining compliance with Section
9.10 to be made on a pro forma basis in accordance with, and to the extent
--- -----
provided in, the immediately succeeding sentence. To the extent the respective
Test Period (i) includes the second fiscal quarter of the fiscal year ended
December 31, 1997, Consolidated Interest Expense for such fiscal quarter shall
be deemed to be $_____ million, (ii) includes the third fiscal quarter of the
fiscal year ended December 31, 1997, Consolidated Interest Expense for such
fiscal quarter shall be deemed to be $____ million and (iii) includes the fourth
fiscal quarter of the fiscal year ended December 31, 1997, Consolidated Interest
Expense shall be determined by (x) taking actual Consolidated Interest Expense
determined in accordance with the definition thereof for any period beginning
on, and ending after, the Initial Borrowing Date and (y) for each day of such
fiscal quarter occurring prior to the Initial Borrowing Date, using a per-day
Consolidated Interest Expense of $[__].
"Total Commitment" shall mean the sum of the Total Term Loan Commitment
and the Total Revolving Loan Commitment.
"Total Leverage Ratio" shall mean on any date the ratio of (i)
Consolidated Debt on such date to (ii) Consolidated EBITDA for the Test Period
most recently ended on or prior to such date (determined after giving effect to
the proviso to the definition of Consolidated EBITDA contained herein). All
calculations of the Total Leverage Ratio shall be made on a Pro Forma Basis, it
--- -----
being understood and agreed that, as provided in the definition of Pro Forma
--- -----
Basis, the adjustments contained in clause (v) thereof shall not be taken into
account in determining the Total Leverage Ratio.
"Total Non-Consolidated Joint Venture Debt" shall mean, at any time, the
sum of the Non-Consolidated Joint Venture Debt for all Non-Consolidated Joint
Ventures at such time.
"Total Non-Consolidated Joint Venture EBITDA" shall mean, for any
period, the sum of the Non-Consolidated Joint Venture EBITDA for all Non-
Consolidated Joint Ventures for such period.
"Total Revolving Loan Commitment" shall mean the sum of the Revolving
Loan Commitments of each of the Banks.
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"Total Term Loan Commitment" shall mean the sum of the Term Loan
Commitments of each of the Banks.
"Total Unutilized Revolving Loan Commitment" shall mean, at any time,
(i) the Total Revolving Loan Commitment at such time less (ii) the sum of the
----
aggregate principal amount of all Revolving Loans and Swingline Loans
outstanding at such time plus the Letter of Credit Outstandings at such time
less (iii) the Blocked Commitment as then in effect.
----
"Trade Letter of Credit" shall have the meaning set forth in Section
2.01(a).
"Tranche" shall mean the respective facility and commitments utilized in
making Loans hereunder, with there being two separate Tranches, i.e., Term Loans
----
and Revolving Loans.
"Transaction" shall mean, collectively, (i) the Common Equity Issuance,
(ii) the issuance of the Senior Subordinated Notes, (iii) the consummation of
the Recapitalization, (iv) the issuance of the PIK Preferred Stock, (v) the
consummation of the Refinancing, (vi) the entering into of the Credit Documents
and the incurrence of all Loans on the Initial Borrowing Date and (vii) the
payment of fees and expenses in connection with the foregoing.
"Type" shall mean any type of Loan determined with respect to the
interest option applicable thereto, i.e., a Base Rate Loan or a Eurodollar Loan.
----
"UCC" shall mean the Uniform Commercial Code as in effect from time to
time in the relevant jurisdiction.
"Unfunded Current Liability" of any Plan shall mean the amount, if any,
by which the actuarial present value of the accumulated plan benefits under the
Plan as of the close of its most recent plan year exceeds the fair market value
of the assets allocable thereto, each determined in accordance with Statement of
Financial Accounting Standards No. 87, based upon the actuarial assumptions used
by the Plan's actuary in the most recent annual valuation of the Plan.
"Unpaid Drawing" shall have the meaning provided in Section 2.04(a).
"Unutilized Revolving Loan Commitment" with respect to any RL Bank at
any time shall mean such RL Bank's Revolving Loan Commitment at such time less
----
the sum of (i) the aggregate outstanding principal amount of all Revolving Loans
made by such RL Bank and (ii) such RL Bank's Percentage of the Letter of Credit
Outstandings at such time.
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"U.S. Dollars" and the sign "$" shall each mean freely transferable
lawful money of the United States of America.
"Voting Stock" shall mean, as to any Person, any class or classes of
capital stock of such Person pursuant to which the holders thereof have the
general voting power under ordinary circumstances to elect at least a majority
of the Board of Directors of such Person.
"Wholly-Owned Domestic Subsidiary" shall mean, as to any Person, any
Wholly-Owned Subsidiary of such Person which is a Domestic Subsidiary.
"Wholly-Owned Subsidiary" shall mean, as to any Person, (i) any
corporation 100% of whose capital stock (other than director's qualifying shares
and/or other nominal amounts of shares required to be held other than by such
Person under applicable law) is at the time owned by such Person and/or one or
more Wholly-Owned Subsidiaries of such Person and (ii) any partnership,
association, joint venture or other entity in which such Person and/or one or
more Wholly-Owned Subsidiaries of such Person has a 100% equity interest at such
time.
"Written" (whether lower or upper case) or "in writing" shall mean any
form of written communication or a communication by means of telex, facsimile
device, telegraph or cable.
SECTION 12. The Agent.
---------
12.01 Appointment. Each Bank hereby irrevocably designates and
-----------
appoints BTCo as Agent of such Bank (such term to include for purposes of this
Section 12, BTCo acting as Collateral Agent) to act as specified herein and in
the other Credit Documents, and each such Bank hereby irrevocably authorizes
BTCo as the Agent to take such action on its behalf under the provisions of this
Agreement and the other Credit Documents and to exercise such powers and perform
such duties as are expressly delegated to the Agent by the terms of this
Agreement and the other Credit Documents, together with such other powers as are
reasonably incidental thereto. The Agent agrees to act as such upon the express
conditions contained in this Section 12. Notwithstanding any provision to the
con trary elsewhere in this Agreement or in any other Credit Document, the Agent
shall not have any duties or responsibilities, except those expressly set forth
herein or in the other Credit Documents, or any fiduciary relationship with any
Bank, and no implied covenants, functions, responsibilities, duties, obligations
or liabilities shall be read into this Agreement or otherwise exist against the
Agent. The provisions of this Section 12 are solely for the benefit of the
Agent and the Banks, and neither the Borrower nor any of its Subsidiaries shall
have any rights as a third party beneficiary of any of the provisions hereof.
In
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performing its functions and duties under this Agreement, the Agent shall act
solely as agent of the Banks and the Agent does not assume and shall not be
deemed to have assumed any obligation or relationship of agency or trust with or
for the Borrower or any of its Subsidiaries.
12.02 Delegation of Duties. The Agent may execute any of its duties
--------------------
under this Agreement or any other Credit Document by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care.
12.03 Exculpatory Provisions. Neither the Agent nor any of its
----------------------
officers, directors, employees, agents, attorneys-in-fact or affiliates shall be
(i) liable for any action lawfully taken or omitted to be taken by it or such
Person in its capacity as Agent under or in connection with this Agreement or
the other Credit Documents (except for its or such Person's own gross negligence
or willful misconduct) or (ii) responsible in any manner to any of the Banks for
any recitals, statements, representations or warranties made by the Borrower,
any of its Subsidiaries or any of their respective officers contained in this
Agree ment or the other Credit Documents, any other Document or in any
certificate, report, state ment or other document referred to or provided for
in, or received by the Agent under or in connection with, this Agreement or any
other Document or for any failure of the Borrower or any of its Subsidiaries or
any of their respective officers to perform its obligations hereunder or
thereunder. The Agent shall not be under any obligation to any Bank to
ascertain or to inquire as to the observance or performance of any of the agree
ments contained in, or conditions of, this Agreement or the other Documents, or
to inspect the properties, books or records of the Borrower or any of its
Subsidiaries. The Agent shall not be responsible to any Bank for the
effectiveness, genuineness, validity, enforce ability, collectability or
sufficiency of this Agreement or any other Document or for any representations,
warranties, recitals or statements made herein or therein or made in any written
or oral statement or in any financial or other statements, instruments, reports,
cert ificates or any other documents in connection herewith or therewith
furnished or made by the Agent to the Banks or by or on behalf of the Borrower
or any of its Subsidiaries to the Agent or any Bank or be required to ascertain
or inquire as to the performance or xxxxx xxxxx of any of the terms, conditions,
provisions, covenants or agreements contained herein or therein or as to the use
of the proceeds of the Loans or of the existence or possible exist ence of any
Default or Event of Default.
12.04 Reliance by Agent. The Agent shall be entitled to rely, and
-----------------
shall be fully protected in relying, upon any note, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, facsimile, telex
or teletype message, statement, order or other document or conversation
reasonably believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and
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statements of legal counsel (including, without limitation, counsel to the
Borrower or any of its Subsidiaries), independent accountants and other experts
selected by the Agent. The Agent shall be fully justified in failing or
refusing to take any action under this Agreement or any other Credit Document
unless it shall first receive such advice or concurrence of the Required Banks
as it deems appropriate or it shall first be indemnified to its satisfaction by
the Banks 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 Agent shall in
all cases be fully pro tected in acting, or in refraining from acting, under
this Agreement and the other Credit Documents in accordance with a request of
the Required Banks, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Banks.
12.05 Notice of Default. The Agent shall not be deemed to have
-----------------
knowledge or notice of the occurrence of any Default or Event of Default unless
the Agent has actually received notice from a Bank or the Borrower referring to
this Agreement, describing such Default or Event of Default and stating that
such notice is a "notice of default." In the event that the Agent receives such
a notice, the Agent shall give prompt notice thereof to the Banks. The Agent
shall take such action with respect to such Default or Event of Default as shall
be reasonably directed by the Required Banks; provided, that, unless and until
--------
the Agent shall have received such directions, the Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interests of the Banks.
12.06 Nonreliance on Agent and Other Banks. Each Bank expressly
------------------------------------
acknowl edges that neither the Agent nor any of its respective officers,
directors, employees, agents, attorneys-in-fact or affiliates have made any
representations or warranties to it and that no act by the Agent hereinafter
taken, including any review of the affairs of the Borrower or any of its
Subsidiaries, shall be deemed to constitute any representation or warranty by
the Agent to any Bank. Each Bank represents to the Agent that it has,
independently and with out reliance upon the Agent or any other Bank, and based
on such documents and informa tion as it has deemed appropriate, made its own
appraisal of and investigation into the business, assets, operations, property,
financial and other condition, prospects and credit worthiness of the Borrower
or its Subsidiaries and made its own decision to make its Loans hereunder and
enter into this Agreement. Each Bank also represents that it will, indepen
dently and without reliance upon the Agent or any other Bank, and based on such
docu ments 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 to make such investigation as it deems
necessary to inform itself as to the business, assets, operations, property,
financial and other condition, prospects and creditworthiness of the Borrower or
its Subsidiaries. The Agent shall not have any duty or responsibility to
provide any Bank with any credit or other information concerning the business,
operations, assets, property, financial and other condition, prospects or
creditworthiness of
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the Borrower or its Subsidiaries which may come into the possession of the Agent
or any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.
12.07 Indemnification. The Banks agree to indemnify the Agent in its
---------------
capacity as such ratably according to their respective "percentages" as used in
determining the Required Banks at such time or, if the Commitments have
terminated and all Loans have been repaid in full, as determined immediately
prior to such termination and repayment (with such "percentages" to be
determined as if there are no Defaulting Banks), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, reasonable expenses or disbursements of any kind whatsoever which may at
any time (including, without limitation, at any time following the payment of
the Obligations) be imposed on, incurred by or asserted against the Agent in its
capacity as such in any way relating to or arising out of this Agreement or any
other Credit Document, or any documents contemplated by or referred to herein or
the transactions contemplated hereby or any action taken or omitted to be taken
by the Agent under or in connection with any of the foregoing, but only to the
extent that any of the foregoing is not paid by the Borrower or any of its
Subsidiaries; provided, that no Bank shall be liable to the Agent for the
--------
payment of any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
solely from the gross negligence or willful misconduct of the Agent. If any
indemnity furnished to the Agent for any purpose shall, in the opinion of the
Agent be insufficient or become impaired, the Agent may call for additional
indemnity and cease, or not commence, to do the acts indem nified against until
such additional indemnity is furnished. The agreements in this Section 12.07
shall survive the payment of all Obligations.
12.08 Agent in its Individual Capacity. The Agent and its affiliates
--------------------------------
may make loans to, accept deposits from and generally engage in any kind of
business with the Borrower and its Subsidiaries as though the Agent were not the
Agent hereunder. With respect to the Loans made by it and all Obligations owing
to it, the Agent shall have the same rights and powers under this Agreement as
any Bank and may exercise the same as though it were not the Agent and the terms
"Bank" and "Banks" shall include the Agent in its individual capacity.
12.09 Holders. The Agent may deem and treat the payee of any Note as
-------
the owner thereof for all purposes hereof unless and until a written notice of
the assignment, transfer or endorsement thereof, as the case may be, shall have
been filed with the Agent. Any request, authority or consent of any Person or
entity who, at the time of making such request or giving such authority or
consent, is the holder of any Note shall be conclusive and binding on any
subsequent holder, transferee, assignee or indorsee, as the case may be, of such
Note or of any Note or Notes issued in exchange therefor.
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12.10 Resignation of the Agent. (a) The Agent may resign from the
------------------------
performance of all its functions and duties hereunder and/or under the other
Credit Documents at any time by giving 30 Business Days' prior written notice to
the Borrower and the Banks. Such resignation shall take effect upon the
appointment of a successor Agent pursuant to clauses (b) and (c) below or as
otherwise provided below.
(b) Upon any such notice of resignation, the Required Banks shall
appoint a successor Agent hereunder or thereunder who shall be a commercial bank
or trust company reasonably acceptable to the Borrower.
(c) If a successor Agent shall not have been so appointed within such
30 Business Day period, the Agent, with the consent of the Borrower (which
consent shall not be unreasonably withheld or delayed), shall then appoint a
successor Agent who shall serve as Agent hereunder or thereunder until such
time, if any, as the Required Banks appoint a successor Agent as provided above.
(d) If no successor Agent has been appointed pursuant to clause (b) or
(c) above by the 30th Business Day after the date such notice of resignation was
given by the Agent, the Agent's resignation shall become effective and the
Required Banks shall thereafter perform all the duties of the Agent hereunder
and/or under any other Credit Document until such time, if any, as the Banks
appoint a successor Agent as provided above.
SECTION 13. Miscellaneous.
-------------
13.01 Payment of Expenses, etc. The Borrower agrees to: (i) whether
-------------------------
or not the transactions herein contemplated are consummated, pay all reasonable
out-of-pocket costs and expenses of the Agent (including, without limitation,
the reasonable fees and disbursements of White & Case and local counsel) in
connection with the negotiation, preparation, execution and delivery of the
Credit Documents and the documents and instru ments referred to therein and any
amendment, waiver or consent relating thereto and in connection with the Agent's
syndication efforts with respect to this Agreement; (ii) pay all reasonable out-
of-pocket costs and expenses of the Agent, each Letter of Credit Issuer and each
of the Banks in connection with the enforcement of the Credit Documents and the
documents and instruments referred to therein and, after an Event of Default
shall have occurred and be continuing, the protection of the rights of the
Agent, each Letter of Credit Issuer and each of the Banks thereunder (including,
without limitation, the reasonable fees and disbursements of counsel (including
in-house counsel) for the Agent, for each Letter of Credit Issuer and for each
of the Banks); (iii) pay and hold each of the Banks harmless from and against
any and all present and future stamp and other similar taxes with respect to the
foregoing matters and save each of the Banks harmless from and against any and
all
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liabilities with respect to or resulting from any delay or omission (other than
to the extent attributable to such Bank) to pay such taxes; and (iv) indemnify
the Agent, the Collateral Agent, each Letter of Credit Issuer and each Bank,
their respective officers, directors, em ployees, representatives and agents
from and hold each of them harmless against any and all losses, liabilities,
claims, damages or expenses incurred by any of them as a result of, or arising
out of, or in any way related to, or by reason of, (a) any investigation,
litigation or other proceeding (whether or not the Agent, the Collateral Agent,
any Letter of Credit Issuer or any Bank is a party thereto and whether or not
any such investigation, litigation or other proceeding is between or among the
Agent, the Collateral Agent, any Letter of Credit Issuer, any Bank, any Credit
Party or any third Person or otherwise) related to the entering into and/or
performance of this Agreement or any other Document or the use of the proceeds
of any Loans hereunder or the Transaction or the consummation of any other
transactions contemplated in any Document (but excluding any such losses,
liabilities, claims, damages or expenses to the extent incurred by reason of the
gross negligence or willful misconduct of the Person to be indemnified), or (b)
the actual or alleged presence of Hazardous Materials in the air, surface water
or groundwater or on the surface or subsurface of any Real Property or any
Environmental Claim, in each case, including, with out limitation, the
reasonable fees and disbursements of counsel and independent consultants
incurred in connection with any such investigation, litigation or other
proceeding.
13.02 Right of Setoff. In addition to any rights now or hereafter
---------------
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence of an Event of Default, the Agent, each Letter
of Credit Issuer and each Bank is hereby authorized at any time or from time to
time, without presentment, demand, protest or other notice of any kind to the
Borrower or any of its Subsidiaries or to any other Person, any such notice
being hereby expressly waived, to set off and to appropriate and apply any and
all deposits (general or special) and any other Indebtedness at any time held or
owing by the Agent, such Letter of Credit Issuer or such Bank (including,
without limitation, by branches and agencies of the Agent, such Letter of Credit
Issuer and such Bank wherever located) to or for the credit or the account of
the Borrower or any of its Subsidiaries against and on account of the
Obligations of the Borrower or any of its Subsidiaries to the Agent, such Letter
of Credit Issuer or such Bank under this Agreement or under any of the other
Credit Documents, including, without limitation, all interests in Obligations of
the Borrower or any of its Subsidiaries purchased by such Bank pursuant to
Section 13.06(b), and all other claims of any nature or description arising out
of or connected with this Agreement or any other Credit Document, irrespective
of whether or not the Agent, such Letter of Credit Issuer or such Bank shall
have made any demand here under and although said Obligations shall be
contingent or unmatured.
13.03 Notices. Except as otherwise expressly provided herein, all
-------
notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, facsimile or cable communication) and mailed,
telegraphed, telexed, telecopied,
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cabled or delivered, if to any Credit Party, at the address specified opposite
its signature below or in the other relevant Credit Documents, as the case may
be; if to any Bank, at its address specified for such Bank on Schedule II; or,
at such other address as shall be desig nated by any party in a written notice
to the other parties hereto. All such notices and communications shall be
mailed, telegraphed, telexed, telecopied or cabled or sent by overnight courier,
and shall be effective when received.
13.04 Benefit of Agreement. (a) This Agreement shall be binding upon
--------------------
and inure to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto; provided, however, the Borrower may not assign or
-------- -------
transfer any of its rights, obligations or interest hereunder or under any other
Credit Document without the prior written consent of the Banks and, provided
--------
further, that, although any Bank may transfer, assign or grant participations in
-------
its rights hereunder, such Bank shall remain a "Bank" for all purposes hereunder
(and may not transfer or assign all or any portion of its Commitments hereunder
except as provided in Section 13.04(b)) and the transferee, assignee or
participant, as the case may be, shall not constitute a "Bank" hereunder and,
provided further, that no Bank shall transfer or grant any participation under
----------------
which the participant shall have rights to approve any amendment to or waiver of
this Agreement or any other Credit Document except to the extent such amendment
or waiver would (i) extend the final scheduled maturity of any Loan, Note or
Letter of Credit (unless such Letter of Credit is not extended beyond the
Revolving Loan Maturity Date) in which such participant is participating, or
reduce the rate or extend the time of payment of interest or Fees thereon
(except in connection with a waiver of applicability of any post-default
increase in interest rates) or reduce the principal amount thereof, or increase
the amount of the participant's participation over the amount thereof then in
effect (it being understood that a waiver of any Default or Event of Default or
of a mandatory reduction in the Total Commitment shall not constitute a change
in the terms of such participation, that an increase in any Commitment or Loan
shall be permitted without the consent of any participant if the participant's
parti cipation is not increased as a result thereof and that any amendment or
modification to the financial definitions in this Agreement shall not constitute
a reduction in any rate of interest or fees for purposes of this clause (i)),
(ii) consent to the assignment or transfer by the Borrower of any of its rights
and obligations under this Agreement or (iii) release all or substantially all
of the Collateral under all of the Security Documents (except as expressly
provided in the Security Documents) supporting the Loans hereunder in which such
parti cipant is participating. In the case of any such participation, the
participant shall not have any rights under this Agreement or any of the other
Credit Documents (the participant's rights against such Bank in respect of such
participation to be those set forth in the agreement executed by such Bank in
favor of the participant relating thereto) and all amounts payable by the
Borrower hereunder shall be determined as if such Bank had not sold such
participation.
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(b) Notwithstanding the foregoing, any Bank (or any Bank together with
one or more other Banks) may (x) assign all or a portion of its Revolving Loan
Commitment (and related outstanding Obligations hereunder) and/or its
outstanding Term Loans to (i) its parent company and/or any affiliate of such
Bank which is at least 50% owned by such Bank or its parent company or to one or
more Banks or (ii) in the case of any Bank that is a fund that invests in bank
loans, any other fund that invests in bank loans and is managed by the same
investment advisor of such Bank or by an Affiliate of such investment advisor or
(y) assign all, or if less than all, a portion equal to at least $5,000,000 in
the aggregate for the assigning Bank or assigning Banks, of such Revolving Loan
Commitments (and related outstanding Obligations hereunder) and outstanding
principal amount of Term Loans to one or more Eligible Transferees (treating (x)
any fund that invests in bank loans and (y) any other fund that invests in bank
loans and is managed by the same investment advisor as such fund or by an
Affiliate of such investment advisor, as a single Eligible Transferee), each of
which assignees shall become a party to this Agreement as a Bank by execution of
an Assignment and Assumption Agreement, provided that (i) at such time Schedule
--------
I shall be deemed modified to reflect the Revolving Loan Commitments and/or
outstanding Term Loans, as the case may be, of such new Bank and of the existing
Banks, (ii) upon surrender of the old Notes (or the furnishing of a standard
indemnity letter from the respective assigning Bank in respect of any lost
Notes), new Notes will be issued, at the Borrower's expense, to such new Bank
and to the assigning Bank, such new Notes to be in conformity with the
requirements of Section 1.05 (with appropriate modifications) to the extent
needed to reflect the revised Revolving Loan Commitments and/or outstanding Term
Loans, as the case may be, (iii) the consent of the Agent and, so long as no
Default or Event of Default is then in existence, the Borrower shall be required
in connection with any assignment to an Eligible Transferee pursuant to clause
(y) of this Section 13.04(b) (which consent, in each case, shall not be
unreasonably withheld or delayed), (iv) the consent of each Letter of Credit
Issuer shall be required in connection with any Revolving Loan Commitments
pursuant to clause (y) of this Section 13.04(b) (which consent shall not be
unreasonably withheld or delayed) and (v) the Agent shall receive at the time of
each assignment, from the assigning or assignee Bank, the payment of a non-
refundable assignment fee of $3,500 and, provided further, that such transfer or
-------- -------
assignment will not be effective until recorded by the Agent on the Register
pursuant to Section 13.17. To the extent of any assignment pursuant to this
Section 13.04(b), the assigning Bank shall be relieved of its obligations
hereunder with respect to its assigned Revolving Loan Commitment and/or
outstanding Term Loans. At the time of each assignment pursuant to this Section
13.04(b) to a Person which is not already a Bank hereunder and which is not a
United States person (as such term is defined in Section 7701(a)(30) of the
Code) for Federal income tax purposes, the respective assignee Bank shall
provide to the Borrower and the Agent the appropriate Internal Revenue Service
Forms (and, if applicable a Section 4.04(b)(ii) Certificate) described in
Section 4.04(b). To the extent that an assignment of all or any portion of a
Bank's Revolving Loan Commitment and outstanding Obligations pursuant to Section
1.13 or this Section 13.04(b) would, due to circumstances existing at
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the time of such assignment, result in increased costs under Section 1.10, 1.11,
2.05 or 4.04 from those being charged by the respective assigning Bank prior to
such assignment, then the Borrower shall not be obligated to pay such increased
costs (although the Borrower shall be obligated to pay any other increased costs
of the type described above resulting from changes after the date of the
respective assignment). Notwithstanding anything to the contrary contained
above, at any time after the termination of the Total Revolving Loan Commitment,
if any Revolving Loans or Letters of Credit remain outstanding, assignments may
be made as provided above, except that the respective assignment shall be of a
portion of the outstanding Revolving Loans of the respective RL Bank and its
participation in Letters of Credit and its obligation to make Mandatory
Borrowings, although any such assignment effected after the termination of the
Total Revolving Loan Commitment shall not release the assigning RL Bank from its
obligations as a Participant with respect to outstanding Letters of Credit or to
fund its share of any Mandatory Borrowing (although the respective assignee may
agree, as between itself and the respective assigning RL Bank, that it shall be
responsible for such amounts).
(c) Nothing in this Agreement shall prevent or prohibit any Bank or
BTCo from pledging its Loans and Notes hereunder to a Federal Reserve Bank in
support of borrowings made by such Bank from such Federal Reserve Bank and, with
the consent of the Agent, any Bank which is a fund may pledge all or any portion
of its Notes or Loans to its trustee in support of its obligations to its
trustee. No pledge pursuant to this clause (c) shall release the transferor
Bank from any of its obligations hereunder.
13.05 No Waiver; Remedies Cumulative. No failure or delay on the part
------------------------------
of the Agent or any Bank in exercising any right, power or privilege hereunder
or under any other Credit Document and no course of dealing between any Credit
Party and the Agent or any Bank shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, power or privilege hereunder or under
any other Credit Document preclude any other or further exercise thereof or the
exercise of any other right, power or privilege hereunder or thereunder. The
rights and remedies herein expressly provided are cumulative and not exclusive
of any rights or remedies which the Agent or any Bank would otherwise have. No
notice to or demand on any Credit Party in any case shall entitle any Credit
Party to any other or further notice or demand in similar or other circumstances
or constitute a waiver of the rights of the Agent or the Banks to any other or
further action in any circum stances without notice or demand.
13.06 Payments Pro Rata. (a) The Agent agrees that promptly after its
-----------------
receipt of each payment from or on behalf of any Credit Party in respect of any
Obligations of such Credit Party, it shall, except as otherwise provided in this
Agreement, distribute such payment to the Banks (other than any Bank that has
consented in writing to waive its pro rata share of such payment) pro rata based
--- ---- --- ----
upon their respective shares, if any, of the Obligations with respect to which
such payment was received.
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(b) Each of the Banks agrees that, if it should receive any amount
hereunder (whether by voluntary payment, by realization upon security, by the
exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise) which is applicable to the payment of the princi pal of, or interest
on, the Loans, Unpaid Drawings or Fees, of a sum which with respect to the
related sum or sums received by other Banks is in a greater proportion than the
total of such Obligation then owed and due to such Bank bears to the total of
such Obligation then owed and due to all of the Banks immediately prior to such
receipt, then such Bank receiving such excess payment shall purchase for cash
without recourse or warranty from the other Banks an interest in the Obligations
of the respective Credit Party to such Banks in such amount as shall result in a
proportional participation by all of the Banks in such amount; provided, that if
--------
all or any portion of such excess amount is thereafter recovered from such Bank,
such purchase shall be rescinded and the purchase price restored to the extent
of such recovery, but without interest.
13.07 Calculations; Computations. (a) The financial statements to be
--------------------------
furnished to the Banks pursuant hereto shall be made and prepared in accordance
with GAAP consistently applied throughout the periods involved (except as set
forth in the notes thereto or as otherwise disclosed in writing by the Borrower
to the Banks); provided, that except as otherwise specifically provided herein,
--------
all computations determining compliance with Sections 4.02, 8.14 and 9,
including definitions used therein shall, in each case, utilize accounting
principles and policies in effect at the time of the preparation of, and in
conformity with those used to prepare, the December 31, 1996 financial
statements of the Borrower delivered to the Banks pursuant to Section 7.10(b);
provided further, that (i) to the extent expressly required pursuant to the
----------------
provisions of this Agreement, certain calcu lations shall be made on a Pro Forma
--- -----
Basis, (ii) to the extent compliance with any of Sections 9.08, 9.09, 9.10 or
9.11 would include periods occurring prior to the Initial Borrowing Date, such
calculation shall be adjusted on a Pro Forma Basis to give effect to the
--- -----
Transaction as if same had occurred on the first day of the respective period
and (iii) in the case of any determinations of Consolidated Interest Expense for
any portion of any Test Period which ends prior to the Initial Borrowing Date,
all computations determining compliance with Section 9.10 shall be calculated in
accordance with the definition of Test Period contained herein.
(b) All computations of interest and Fees hereunder shall be made on
the actual number of days elapsed over a year of 360 days.
13.08 Governing Law; Submission to Jurisdiction; Venue. (a) THIS
------------------------------------------------
AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE
GOVERNED BY THE LAW OF THE STATE OF NEW YORK. Any legal action or proceeding
with respect to this
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Agreement or any other Credit Document may be brought in the courts of the State
of New York or of the United States for the Southern District of New York, and,
by execution and delivery of this Agreement, the Borrower hereby irrevocably
accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. The Borrower hereby
irrevocably designates, appoints and empowers CT Corpor ation System, with
offices on the date hereof at 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 as its
designee, appointee and agent to receive, accept and acknowledge for and on its
behalf, and in respect of its property, service of any and all legal process,
summons, notices and documents which may be served in any such action or
proceeding. If for any reason such designee, appointee and agent shall cease to
be available to act as such, the Borrower agrees to designate a new designee,
appointee and agent in New York City on the terms and for the purposes of this
provision satisfactory to the Agent under this Agreement. The Borrower hereby
further irrevocably waives any claim that any such courts lack jurisdiction over
the Borrower, and agrees not to plead or claim, in any legal action or
proceeding with respect to this Agreement or any other Credit Document brought
in any of the aforesaid courts, that any such court lacks jurisdiction over the
Borrower. The Borrower further irrevocably consents to the service of process
in any such action or proceeding by the mailing of copies thereof by registered
or certified mail, postage prepaid, to the Borrower, at its address for notices
pursuant to Section 13.03, such service to become effective 30 days after such
mailing. The Borrower hereby irrevocably waives any objection to such service
of process and further irrevocably waives and agrees not to plead or claim in
any action or proceeding commenced hereunder or under any other Credit Document
that service of process was in any way invalid or ineffective. Nothing herein
shall affect the right of the Agent, any Bank or the holder of any Note to serve
process in any other manner permitted by law or to commence legal proceedings or
otherwise proceed against any Credit Party in any other jurisdiction.
(b) The Borrower hereby irrevocably waives any objection which it may
now or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement or any other
Credit Document brought in the courts referred to in clause (a) above and hereby
further irrevocably waives and agrees not to plead or claim in any such court
that any such action or proceeding brought in any such court has been brought in
an inconvenient forum.
13.09 Counterparts. This Agreement may be executed in any number of
------------
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A complete set of
counterparts executed by all the parties hereto shall be lodged with the
Borrower and the Agent.
13.10 Effectiveness. This Agreement shall become effective on the date
-------------
(the "Effective Date") on which the Borrower, the Agent and each of the Banks
shall have
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signed a counterpart hereof (whether the same or different counterparts) and
shall have delivered the same to the Agent at the Notice Office or at the office
of Agent's counsel. The Agent will give the Borrower and each Bank prompt
written notice of the occurrence of the Effective Date.
13.11 Headings Descriptive. The headings of the several sections and
--------------------
subsec tions of this Agreement are inserted for convenience only and shall not
in any way affect the meaning or construction of any provision of this
Agreement.
13.12 Amendment or Waiver; etc. (a) Neither this Agreement nor any
-------------------------
other Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by the respective Credit Parties party thereto and the
Required Banks, provided that no such change, waiver, discharge or termination
--------
shall, without the consent of each Bank (other than a Defaulting Bank) (with
Obligations being directly affected thereby in the case of the following clause
(i)), (i) extend the final scheduled maturity of any Loan or Note or extend the
stated maturity of any Letter of Credit beyond the Revolving Loan Maturity Date,
or reduce the rate or extend the time of payment of interest or Fees thereon, or
reduce the principal amount thereof (it being understood that any amendment or
modification to the financial definitions in this Agreement shall not constitute
a reduction in any rate of interest or fees for purposes of this clause (i)),
(ii) release all or substantially all of the Collateral (except as expressly
provided in the Security Documents) under all the Security Documents, (iii)
amend, modify or waive any provision of this Section 13.12, (iv) reduce the
percentage specified in the definition of Required Banks (it being understood
that, with the consent of the Required Banks, additional extensions of credit
pursuant to this Agreement may be included in the determination of the Required
Banks on substantially the same basis as the extensions of Term Loans and
Revolving Loan Commitments are included on the Effective Date) or (v) consent to
the assignment or transfer by the Borrower of any of its rights and obligations
under this Agreement; provided further, that no such change, waiver, discharge
----------------
or termination shall (v) increase the Commitments of any Bank over the amount
thereof then in effect without the consent of such Bank (it being understood
that waivers or modifications of conditions precedent, covenants, Defaults or
Events of Default or of a mandatory reduction in the Total Commitment shall not
constitute an increase of the Commitment of any Bank, and that an increase in
the available portion of any Commitment of any Bank shall not constitute an
increase in the Commitment of such Bank), (w) without the consent of each Letter
of Issuer, amend, modify or waive any provision of Section 2 or alter its rights
or obligations with respect to Letters of Credit, (x) without the consent of
BTCo, alter its rights or obligations with respect to Swingline Loans, (y)
without the consent of the Agent, amend, modify or waive any provision of
Section 12 as same applies to the Agent or any other provision as same relates
to the rights or obligations of the Agent and (z) without the consent of the
Collateral Agent, amend, modify or waive any provision relating to the rights or
obligations of the Collateral Agent.
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(b) If, in connection with any proposed change, waiver, discharge or
termination of or to any of the provisions of this Agreement as contemplated by
clauses (i) through (v), inclusive, of the first proviso to Section 13.12(a),
the consent of the Required Banks is obtained but the consent of one or more of
such other Banks whose consent is required is not obtained, then the Borrower
shall have the right, so long as all non-consenting Banks whose individual
consent is required are treated as described in either clause (A) or (B) below,
to either (A) replace each such non-consenting Bank or Banks (or, at the option
of the Borrower if the respective Bank's consent is required with respect to
less than all Tranches of Loans (or related Commitments), to replace only the
Revolving Loan Commitments and/or Loans of the respective non-consenting Bank
which gave rise to the need to obtain such Bank's individual consent) with one
or more Replacement Banks pursuant to Section 1.13 so long as at the time of
such replacement, each such Replacement Bank consents to the proposed change,
waiver, discharge or termination or (B) terminate such non-consenting Bank's
Revolving Loan Commitment (if such Bank's consent is required as a result of its
Revolving Loan Commitment) and/or repay each Tranche of outstanding Loans of
such Bank which gave rise to the need to obtain such Bank's consent and/or cash
collateralize its applicable Adjusted RL Percentage of the Letter of Credit of
Outstandings, in accordance with Sections 3.02(b) and/or 4.01(b), provided that,
--------
unless the Revolving Loan Commitment which is terminated and Loans which are
repaid pursuant to preceding clause (B) are immediately replaced in full at such
time through the addition of new Banks or the increase of the Revolving Loan
Commitments and/or outstanding Loans of existing Banks (who in each case must
specifically consent thereto), then in the case of any action pursuant to
preceding clause (B), the Required Banks (determined after giving effect to the
proposed action) shall specifically consent thereto, provided further, that the
----------------
Borrower shall not have the right to replace a Bank, terminate its Revolving
Loan Commitment or repay its Loans solely as a result of the exercise of such
Bank's rights (and the withholding of any required consent by such Bank)
pursuant to the second proviso to Section 13.12(a).
13.13 Survival. All indemnities set forth herein including, without
--------
limitation, in Sections 1.10, 1.11, 2.05, 4.04, 12.07 and 13.01, shall, subject
to the provisions of Section 13.18 (to the extent applicable), survive the
execution and delivery of this Agreement and the making and repayment of the
Loans.
13.14 Domicile of Loans and Commitments. Each Bank may transfer and
---------------------------------
carry its Loans and/or Commitments at, to or for the account of any branch
office, subsidiary or affiliate of such Bank; provided, that the Borrower shall
--------
not be responsible for costs arising under Section 1.10, 1.11, 2.05 or 4.04
resulting from any such transfer (other than a transfer pursuant to Section
1.12) to the extent such costs would not otherwise be applicable to such Bank in
the absence of such transfer.
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13.15 Confidentiality. (a) Each of the Banks agrees that it will use
---------------
its rea sonable efforts not to disclose without the prior consent of the
Borrower (other than to its directors, employees, auditors, counsel or other
professional advisors, to affiliates or to another Bank if the Bank or such
Bank's holding or parent company in its sole discretion determines that any such
party should have access to such information) any information with respect to
the Borrower or any of its Subsidiaries which is furnished pursuant to this
Agreement; provided, that any Bank may disclose any such information (a) as has
--------
become generally available to the public, (b) as may be required or appropriate
(x) in any report, statement or testimony submitted to any municipal, state or
Federal regulatory body having or claiming to have jurisdiction over such Bank
or to the Federal Reserve Board or the Federal Deposit Insurance Corporation or
similar organizations (whether in the United States or elsewhere) or their
successors or (y) in connection with any request or requirement of any such
regulatory body, (c) as may be required or appropriate in response to any
summons or subpoena or in connection with any litigation, (d) to comply with any
law, order, regulation or ruling applicable to such Bank, and (e) to any
prospective transferee in connection with any contemplated transfer of any of
the Notes or any interest therein by such Bank; provided, that such prospective
--------
transferee agrees to be bound by this Section 13.15 to the same extent as such
Bank.
(b) The Borrower hereby acknowledges and agrees that each Bank may
share with any of its affiliates any information related to the Borrower or any
of its Subsidiaries (including, without limitation, any nonpublic customer
information regarding the creditworthiness of the Borrower and its
Subsidiaries), provided that such Persons shall be subject to the provisions of
--------
this Section 13.15 to the same extent as such Bank.
13.16 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS AGREEMENT
--------------------
HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT
DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
13.17 Register. The Borrower hereby designates the Agent to serve as
--------
the Borrower's agent, solely for purposes of this Section 13.17, to maintain a
register (the "Register") on which it will record the Commitments from time to
time of each of the Banks, the Loans made by each of the Banks and each
repayment in respect of the principal amount of the Loans of each Bank. Failure
to make any such recordation, or any error in such recordation shall not affect
the Borrower's obligations in respect of such Loans. With respect to any Bank,
the transfer of the Revolving Loan Commitment of such Bank and the rights to the
principal of, and interest on, any Loan shall not be effective until such
transfer is recorded on the Register maintained by the Agent with respect to
ownership of such Revolving Loan Commitment and Loans and prior to such
recordation all amounts owing to the transferor with respect to such Revolving
Loan Commitment and Loans shall remain
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owing to the transferor. The registration of assignment or transfer of all or
part of any Revolving Loan Commitment and Loans shall be recorded by the Agent
on the Register only upon the acceptance by the Agent of a properly executed and
delivered Assignment and Assumption Agreement pursuant to Section 13.04(b).
Coincident with the delivery of such an Assignment and Assumption Agreement to
the Agent for acceptance and registration of assignment or transfer of all or
part of a Loan, or as soon thereafter as practicable, the assigning or
transferor Bank shall surrender the Note evidencing such Loan, and thereupon one
or more new Notes in the same aggregate principal amount shall be issued to the
assigning or transferor Bank and/or the new Bank. The Borrower agrees to
indemnify the Agent from and against any and all losses, claims, damages and
liabilities of whatsoever nature which may be imposed on, asserted against or
incurred by the Agent in performing its duties under this Section 13.17.
13.18 Limitation on Additional Amounts, etc. Notwithstanding anything
--------------------------------------
to the contrary contained in Section 1.10, 1.11, 2.05 or 4.04 of this Agreement,
unless a Bank gives notice to the Borrower that it is obligated to pay an amount
under such Section within six months after the later of (x) the date the Bank
incurs the respective increased costs, Taxes, loss, expense or liability,
reduction in amounts received or receivable or reduction in return on capital or
(y) the date such Bank has actual knowledge of its incurrence of the respective
increased costs, Taxes, loss, expense or liability, reductions in amounts
received or receivable or reduction in return on capital, then such Bank shall
only be entitled to be compensated for such amount by the Borrower pursuant to
said Section 1.10, 1.11, 2.05 or 4.04, as the case may be, to the extent of the
costs, Taxes, loss, expense or liability, reduction in amounts received or
receivable or reduction in return on capital that are incurred or suffered on or
after the date which occurs six months prior to such Bank giving notice to the
Borrower that it is obligated to pay the respective amounts pursuant to said
Section 1.10, 1.11, 2.05 or 4.04, as the case may be. This Section 13.18 shall
have no applicability to any Section of this Agreement other than said Sections
1.10, 1.11, 2.05 and 4.04.
13.19 Post-Closing Actions. Notwithstanding anything to the contrary
--------------------
contained in this Agreement or the other Credit Documents, the parties hereto
acknowledge and agree that:
(a) Security Document Filings. Form UCC-1 financing statements
-------------------------
delivered by the Borrower to the Collateral Agent on the Initial Borrowing Date
shall be filed in the appropriate governmental office within 10 days following
the Initial Borrowing Date.
(b) Certificates of Title. The Collateral Agent's security interest
---------------------
with respect to the certificates of title in respect of all Healthcare Units
owned by the Borrower and its Subsidiaries on the Initial Borrowing Date (other
than Healthcare Units securing Existing
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Indebtedness not being refinanced on the Initial Borrowing Date) shall be
registered in the appropriate governmental office within 90 days following the
Initial Borrowing Date.
(c) Insurance Policies. Within 30 days following the Initial Borrowing
------------------
Date, the Borrower shall have deposited with the Collateral Agent all policies
with respect to the insurance required to be maintained in favor of the
Collateral Agent pursuant to Section 8.03.
(d) UCC-3 Termination Statements. Within 60 days following the Initial
----------------------------
Borrowing Date (or such later date as shall have been determined by the Agent in
its sole discretion), the Agent shall have received Form UCC-3 termination
statements in respect of the Liens listed on Part B of Schedule IX hereto and
same shall be filed in the appropriate governmental office within 75 days
following the Initial Borrowing Date (or such later date as shall have been
determined by the Agent in its sole discretion). Within 90 days following the
Initial Borrowing Date (or such later date as shall have been determined by the
Agent in its sole discretion), the Agent shall have received Form UCC-3
termination statements in respect of the Liens listed on Part C of Schedule IX
hereto and same shall be filed in the appropriate governmental office within 105
days following the Initial Borrowing Date (or such later date as shall have been
determined by the Agent in its sole discretion).
All provisions of this Credit Agreement and the other Credit Documents
(including, without limitation, all conditions precedent, representations,
warranties, covenants, events of default and other agreements herein and
therein) shall be deemed modified to the extent necessary to effect the
foregoing (and to permit the taking of the actions described above within the
time periods, required above, rather than as otherwise provided in the Credit
Documents); provided, that (x) to the extent any representation and warranty
--------
would not be true because the foregoing actions were not taken on the Initial
Borrowing Date, the respective representation and warranty shall be required to
be true and correct in all material respects at the time the respective action
is taken (or was required to be taken) in accordance with the foregoing
provisions of this Section 13.19 and (y) all representations and warranties
relating to the Collateral Documents shall be required to be true immediately
after the actions required to be taken by Section 13.19 have been taken (or were
required to be taken). The acceptance of the benefits of the Loans shall
constitute a representation, warranty and covenant by the Borrower to each of
the Banks that the actions required pursuant to this Section 13.19 will be, or
have been, taken within the rele vant time periods referred to in this Section
13.19 and that, at such time, all representations and warranties contained in
this Credit Agreement and the other Credit Documents shall then be true and
correct without any modification pursuant to this Section 13.19. The parties
hereto acknowledge and agree that the failure to take any of the actions
required above, within the relevant time periods required above, shall give rise
to an immediate Event of Default pursuant to this Agreement.
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* * * *
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IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
officers to execute and deliver this Agreement as of the date first above
written.
Address:
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ALLIANCE IMAGING, INC.
_________________________
_________________________
Telephone No.:
Facsimile No.: By ________________________________
Attention: Title:
BANKERS TRUST COMPANY,
Individually and as Agent
By________________________________
Title:
[ADDITIONAL BANKS]
By_________________________________
Title:
Schedule I
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LIST OF BANKS AND COMMITMENTS
-----------------------------
Bank Term Loan Revolving Loan
Commitment Commitment
---------- ----------
Bankers Trust Company $ $
[Additional Banks] $ $
Total $50,000,000 $150,000,000
Schedule II
-----------
BANK ADDRESSES
--------------
Bank Address
---- -------
Bankers Trust Company Xxx Xxxxxxx Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: XXXXXXX XXXXXXX
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
[Additional Banks]
Schedule III
------------
REAL PROPERTIES
---------------
Schedule IV
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EXISTING INDEBTEDNESS
---------------------
Schedule V
----------
PENSION PLANS
-------------
Schedule VI
-----------
EXISTING INVESTMENTS
--------------------
Schedule VII
------------
SUBSIDIARIES
------------
Schedule VIII
-------------
INSURANCE
---------
Schedule IX
-----------
EXISTING LIENS
--------------
Filing File Original Description
Location Debtor Secured Party Number File Date of Collateral
--------- ------ ------------- ------ --------- -------------