SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 24, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ________ to ___________
Commission file number: 000-28590
Fine Host Corporation
Delaware 06 - 1156070
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3 Greenwich Office Park
Greenwich, CT 06831
(203) 629 - 4320
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
The Registrant had 9,056,643 shares of common stock, $.01 par value,
outstanding as of November 7, 1997.
<PAGE>
TABLE OF CONTENTS
Part I - Financial Information
Item 1 Financial Statements (unaudited)
* Consolidated Balance Sheets as of September 24, 1997 and
December 25, 1996
* Consolidated Statements of Income - Three and Nine Months
Ended September 24, 1997 and September 25, 1996
* Consolidated Statement of Stockholders' Equity for the Nine Months
Ended September 24, 1997
* Consolidated Statements of Cash Flows - Nine Months Ended
September 24, 1997 and September 25, 1996
* Notes to Consolidated Financial Statements
Item 2 Management=s Discussion and Analysis of Financial Condition and
Results of Operations
Item 3 Quantitative and Qualitative Disclosure About Market Risk
Part II - Other Information
Item 1 Legal Proceedings
Item 2 Changes in Securities
Item 6 Exhibits and Reports on Form 8-K
Signature
<PAGE>
Part I. Financial Information
Item 1. Financial Statements
FINE HOST CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
September 24, 1997 December 25, 1996
------------------ -----------------
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 5,557 $ 4,724
Accounts receivable 35,793 14,580
Inventories 6,565 3,260
Prepaid expenses and
other current assets 5,519 3,749
------ ------
Total current assets 53,434 26,313
Contract rights, net 48,036 22,869
Fixtures and equipment, net 39,346 24,057
Excess of cost over fair value
of net assets acquired, net 66,784 34,362
Other assets 7,168 9,842
-------- --------
Total assets $214,768 $117,443
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 37,001 $ 18,690
Current portion of subordinated debt 2,187 3,045
------ ------
Total current liabilities 39,188 21,735
Deferred income taxes 17,788 12,360
Long-term debt 40,741 31,562
Subordinated debt 3,759 5,014
------- ------
Total liabilities 101,476 70,671
Stockholders' equity:
Common Stock, $.01 par value,
25,000,000 shares authorized,
9,054,993 and 6,212,016 issued
and outstanding at September 24,1997
and December 25, 1996, respectively 91 62
Additional paid-in capital 103,151 41,778
Retained earnings 10,206 5,121
Receivables from stockholders for
purchase of Common Stock (156) (189)
------- -------
Total stockholders' equity 113,292 46,772
------- -------
Total liabilities and
stockholders' equity $214,768 $117,443
======== ========
See accompanying notes to unaudited consolidated financial statements.
<PAGE>
FINE HOST CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 24, September 25, September 24, September 25,
1997 1996 1997 1996
----------------------------- -------------------------------
<S> <C> <C> <C> <C>
Net sales $70,439 $37,272 $173,283 $87,236
Cost of sales 61,890 32,766 154,277 77,786
------ ------ ------- ------
Gross profit 8,549 4,506 19,006 9,450
General and administrative
expenses 2,954 1,467 8,899 4,044
------ ------ ------ -----
Income from operations 5,595 3,039 10,107 5,406
Interest expense, net 491 496 1,319 2,018
------ ------ ------ -----
Income before tax provision 5,104 2,543 8,788 3,388
Tax provision 2,118 1,144 3,703 1,480
------ ------ ------ -----
Net income 2,986 1,399 5,085 1,908
Accretion to redemption value
of warrants - - - (1,300)
------ ------ ------ ------
Net income available to
Common Stockholders $ 2,986 $ 1,399 $ 5,085 $ 608
======= ======= ======= ======
Earnings per share of Common Stock $ .32 $ .22 $ .57 $ .14
======= ======= ======= ======
Average number of shares
of Common Stock outstanding 9,366 6,235 8,844 4,476
======= ======= ======= ======
Earnings per share of Common Stock
assuming full dilution $ .32 $ .22 $ .57 $ .13
======= ======= ====== ======
Average number of shares of Common
Stock outstanding assuming
full dilution 9,460 6,249 8,983 4,525
======= ======= ====== =====
See accompanying notes to unaudited consolidated financial statements.
</TABLE>
<PAGE>
FINE HOST CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(in thousands, except share data)
(unaudited)
<TABLE>
<CAPTION>
Receivables
from
Stockholders
for
Additional Purchase of
Common Stock Paid-In Retained Common Stockholders'
Shares Amount Capital Earnings Stock Equity
--------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Balance, December 25, 1996 6,212,016 $62 $ 41,778 $ 5,121 $(189) $ 46,772
Shares issued in connection
with follow-on public offering 2,689,000 27 59,073 59,100
Options exercised 75,449 1 1,096 1,097
Conversion of Ideal convertible notes 76,332 1 1,144 1,145
Stockholder receivable collected 33 33
Stock issued to non-employee directors 2,196 -- 60 60
Net income 5,085 5,085
--------------------------------------------------------------------------
Balance, September 24, 1997 9,054,993 $91 $103,151 $10,206 $(156) $113,292
==========================================================================
See accompanying notes to unaudited consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
FINE HOST CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
<CAPTION>
Nine Months Ended
September 24, September 25,
1997 1996
---------------------------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 5,085 $ 1,908
Adjustments to reconcile net
income to net cash provided by
operating activities:
Depreciation and amortization 6,739 3,115
Deferred income tax provision 3,703 1,479
Changes in operating assets
and liabilities, net of effects
from acquistion of businesses:
Accounts receivable (11,581) (4,381)
Inventories (1,254) (549)
Prepaid expenses and other current assets (1,140) (1,788)
Accounts payable and accrued expenses (7,507) 735
Increase in other assets 2,731 (3,565)
------- -------
Net cash provided by operating activities (3,224) (3,046)
------- -------
Cash flows from investing activities:
Increase in contract rights (13,798) (4,679)
Purchases of fixtures and equipment (12,041) (3,914)
Disposal of fixtures and equipment 528 64
Acquisition of business, net of cash acquired (39,184) (5,169)
Collection of notes receivable 871 494
------- ------
Net cash used in investing activities (63,624) (13,204)
------- ------
Cash flows from financing activities:
Borrowings under long-term debt agreement 59,061 14,367
Issuance of subordinated debt 1,272 -
Proceeds from issuance of common stock 59,191 32,016
Payment of long-term debt (49,882) (19,268)
Payment of subordinated debt (2,469) (8,037)
Redemption of warrants - (200)
Proceeds from exercise of warrants - 609
Proceeds from exercise of options 508 -
------ ------
Net cash provided by financing activities 67,681 19,487
------ ------
Net increase in cash 833 3,237
Cash, beginning of period 4,724 634
------- -------
Cash, end of period $ 5,557 $ 3,871
======= =======
See accompanying notes to unaudited consolidated financial statements.
</TABLE>
<PAGE>
FINE HOST CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands, except per share data)
(unaudited)
1. Summary of Significant Accounting Policies
Basis of Presentation--The unaudited consolidated financial statements
include the accounts of Fine Host (the ACompany@) and its wholly-owned
subsidiaries. All significant intercompany transactions and accounts have been
eliminated.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted. The unaudited financial statements include all
adjustments, all of which are of a normal recurring nature, which, in the
opinion of management, are necessary for a fair presentation of the results of
operations for the three and nine months ended September 24, 1997 and September
25, 1996. The accompanying unaudited consolidated financial statements should be
read in conjunction with the consolidated financial statements of the Company
and notes thereto for the fiscal year ended December 25, 1996 included in the
Company's Annual Report on Form 10-K.
Earnings Per Share--Earnings per share of Common Stock is computed based on
the weighted average number of common and common equivalent shares outstanding
during each period. Earnings per share assuming full dilution gives effect to
the assumed exercise of all dilutive stock options and the assumed conversion of
dilutive convertible securities (debt and warrants) except when their effect is
antidilutive. In calculating earnings per share, net income has been reduced for
the accretion to the redemption value of warrants by $1,300 for the nine months
ended September 25, 1996.
Accounting Pronouncements--In February 1997, the FASB issued Statement of
Financial Accounting Standards ("SFAS") No. 128, Earnings per share. SFAS No.
128 specifies the computation, presentation and disclosure requirements for
earnings per share ("EPS"). SFAS No. 128 is effective for financial statements
for interim and annual periods ending after December 15, 1997. Earlier
application is not permitted. On a pro forma basis computed in accordance with
SFAS No. 128 and before warrant accretion, Basic EPS would have been $.33 and
$.23; and Diluted EPS would have been $.32 and $.22, for the three months ended
September 24, 1997 and September 25, 1996, respectively. For the nine months
ended September 24, 1997 and September 25, 1996, Basic EPS would have been $.60
and $.60; and Diluted EPS would have been $.57 and $.43, respectively.
2. Acquisitions
On October 3, 1997, the Company acquired 100% of the stock of Total Food
Service Direction, Inc. ("Total"). Total provides contract food services to 35
business dining and educational facilities in southern Florida. The purchase
price was approximately $4,500, consisting of cash and subordinated promissory
notes to sellers.
On August 27, 1997, the Company acquired 100% of the stock of Best, Inc.
("Best"). Best provides contract food services to approximately 150 healthcare,
corrections, business dining and education clients in Minnesota, Wisconsin,
North Dakota, South Dakota, Illinois and Iowa. The purchase price was
approximately $26,500, consisting of cash and assumed debt.
On August 6, 1997, the Company acquired 100% of the stock of Statewide
Industrial Catering, Inc. ("Statewide"). Statewide provides contract food
service to 25 school districts in the New York City Metropolitan Area. The
purchase price was approximately $3,200, consisting of cash, assumed debt of
Statewide and a subordinated promissory note.
On January 23, 1997, the Company acquired 100% of the stock of Versatile
Holding Corporation, which owns 100% of the stock of Serv-Rite Corporation
("Serv-Rite"), a contract food services management company that provides food
services to the education and business dining markets in New York and
Pennsylvania. The purchase price was approximately $7,500, consisting of cash
and assumed debt of Serv-Rite.
On December 30, 1996, the Company acquired 100% of the stock of Service
Dynamics Corp. ("Service Dynamics"). Service Dynamics provides contract food
service to the education and business dining markets primarily in New Jersey.
The purchase price was approximately $3,000, consisting of cash paid to the
seller.
The aforementioned acquisitions have been accounted for under the purchase
method of accounting and, accordingly, the accompanying unaudited consolidated
financial statements reflect the fair values of the assets acquired and
liabilities assumed or incurred as of the effective date of the acquisitions.
The results of operations of the acquired companies are included in the
accompanying unaudited consolidated financial statements since their respective
dates of acquisition.
The following table summarizes pro forma information with respect to the
income statement data for the nine months ended September 24, 1997 and September
25, 1996, as if the acquisitions of Best, Statewide, Serv-Rite and Service
Dynamics had been completed as of the beginning of such period. No adjustment
for acquisition synergies (i.e. overhead reductions) have been reflected:
Nine Months Ended
September 24, September 25,
1997 1996
--------------------------------
Summary statement of income data:
Net sales $205,828 $150,229
Income from operations 9,498 3,814
Net income (loss) before warrant accretion 1,779 (665)
Net income (loss) per share before warrant
accretion assuming full dilution $ .20 $ (.15)
===== ======
This pro forma information is provided for informational purposes only. It
is based on historical information and does not necessarily reflect the actual
results that would have occurred nor is it necessarily indicative of future
results of operations of the combined enterprise.
3. Accounts Payable and Accrued Expenses
Accounts payable and accrued expenses consist of the following:
September 24, December 25,
1997 1996
--------- ----------
Accounts payable $ 12,637 $ 8,404
Accrued wages and benefits 6,929 2,640
Accrued rent to clients 7,413 3,187
Accrued other 10,022 4,459
-------- -------
Total $ 37,001 $18,690
======== =======
4. Long-Term Debt
Long-term debt consists of the following:
September 24, December 25,
1997 1996
------------- ----------
Working Capital Line $9,841 $15,818
Guidance Line 30,900 15,744
------ -------
Total $ 40,741 $31,562
====== =======
The net proceeds from the follow on public offering (the "Follow-On
Offering"), on February 12, 1997, including the exercise of the over allotment
option granted to the underwriters (see Note 6), were used to repay all of the
long term debt outstanding at the close of the transaction.
On July 30, 1997, the Company entered into the Fourth Amended and Restated
Loan Agreement, a $200 million credit facility with Bank Boston, N.A., as
Administrative Agent (the "Administrative Agent"), U.S. Trust, as Documentation
Agent, and certain banks and other financial institutions party thereto (the
"Bank Agreement"). The Bank Agreement provides for (i) a five year working
capital revolving credit line for general corporate purposes and letters of
credit, in the maximum aggregate amount of $50 million (the "Working Capital
Line") and (ii) a line of credit to provide for future expansion by the Company,
in the maximum amount of $150 million (the "Guidance Line"). The Working Capital
Line provides funds for liquidity, seasonal borrowing needs and other general
corporate purposes. The Guidance Line is available on a revolving basis until
July 30, 2000, to fund the Company's acquisitions and for investments made in
connection with facility agreements. At July 30, 2000, all loans outstanding
under the Guidance Line will convert to term loans, payable quarterly over a
three-year period. Interest on all loans under the Bank Agreement will be based
on, at the Company's option, either a prime rate or a LIBOR rate plus an
incremental rate based on a ratio of debt to EBITDA, not to be less than .75% or
greater than 1.5%. EBITDA represents earnings before interest expense, income
tax expense, depreciation and amortization.
The Company's obligations under the Bank Agreement are collateralized by a
pledge of shares of the common stock or other equity interests of the Company's
subsidiaries, as well as by certain fixtures and equipment, accounts receivable
and other assets, as well as the receipt, if any, of certain funds paid to the
Company with respect to the termination of client contracts prior to their
expiration.
The Bank Agreement contains various financial and other restrictions,
including, but not limited to, restrictions on indebtedness, capital
expenditures, acquisitions and investments. In connection with the Rule 144A
private placement of $175 million of 5.0% Convertible Subordinated Notes (see
Note 5), the Bank Agreement was amended to allow for the issuance of up to $200
million in publicly offered debt. The Bank Agreement requires maintenance of (i)
certain financial ratios, including ratios of total debt to EBITDA and EBITDA to
interest paid, (ii) minimum net worth and (iii) minimum EBITDA. The Bank
Agreement permits the payment of dividends subject to compliance with all
covenants.
At September 24, 1997, the Company had an outstanding letter of credit for $20
million under the Bank Agreement.
5. Subordinated Debt
In October 1997, the Company issued, through a private placement pursuant to
Rule 144A under the Securities Act of 1933, $175 million of 5.0% Convertible
Subordinated Notes (the "Notes") due 2004. The Notes are unsecured obligations
of the Company and are convertible into common stock at a conversion price of
$44.50 per share. The net proceeds of $169.1 million, after deducting
underwriting discounts and certain expenses, was used to repay approximately $50
million in outstanding debt under the Bank Agreement. The remaining net proceeds
were invested in short term investments in accordance with the Company's
investment policy.
In July 1996, as part of the acquisition of Ideal Management Services Inc.
("Ideal"), the Company issued to the stockholders of Ideal two convertible
subordinated promissory notes (the "Ideal Convertible Notes") each with a face
value of $710 at 7 1/4% interest per annum, payable in quarterly installments.
At the option of the note holders, the outstanding principal balance of the
convertible notes was convertible into common stock at a conversion price of $15
per share. On July 30, 1997, the aggregate outstanding principal balances of the
Ideal Convertible Notes of $1,145 was converted into 76,332 shares of common
stock.
6. Stockholders' Equity
On February 12, 1997, the Company conducted a Follow-On Offering as
authorized by its Board of Directors, selling 2,689,000 shares of its common
stock at a price of $23.50 per share, generating net proceeds (including the net
proceeds received by the Company upon the exercise of certain stock options held
by senior executives of the Company in connection with the Follow-On Offering)
of approximately $59.1 million, after deducting the underwriting discount and
offering expenses paid by the Company. The net proceeds were used to repay
obligations under the Company's then-existing credit facility and the remainder
of the net proceeds was invested in short term investments in accordance with
the Company=s investment policy.
7. Income Taxes
For the nine months ended September 24, 1997, the Company recorded a
provision of $3,703, which was entirely deferred. In addition, the Company had,
for Federal income tax reporting, an estimated net operating loss carry forward
of approximately $3,500 that will begin to expire in 2008.
8. Subsequent Events
In October 1997, the Company acquired Total Food Service Direction, Inc.
("Total"), for approximately $4.5 million. Total is a Miami-based food service
company servicing the business dining and education markets. See Note 2.
On October 27, 1997, the Company issued $175 million of 5.0% Convertible
Subordinated Notes due 2004. See Note 5.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Fine Host Corporation is a leading contract food service management
company, providing food and beverage concession and catering services to more
than 900 facilities located in 41 states, primarily through multi-year contracts
in the following markets: the recreation and leisure market ("Recreation and
Leisure") serving arenas, stadiums, amphitheaters, civic centers and other
recreational facilities; the convention center market ("Convention Centers");
the education market ("Education") serving colleges, universities and elementary
and secondary school nutrition programs; the business dining market ("Business
Dining") serving corporate cafeterias, office complexes and manufacturing
plants; the healthcare market ("Healthcare") serving long-term care facilities
and hospitals; and the corrections market ("Corrections") serving prisons and
jails.
The matters discussed in this Form 10-Q contain forward looking statements
that involve risks and uncertainties including risks associated with the food
service industry and other risks detailed from time to time in the Company=s
filings with the Securities and Exchange Commission.
Results of Operations
The following table sets forth, for the periods indicated, certain
financial data as a percentage of the Company's net sales:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 24, September 25, September 25, September 25,
1997 1996 1997 1996
-------------------------------- ----------------------------------
<S> <C> <C> <C> <C>
Net sales 100.0% 100.0% 100.0% 100.0%
Cost of sales 87.9 87.9 89.0 89.2
------ ----- ------ ------
Gross profit 12.1 12.1 11.0 10.8
General and administrative expenses 4.2 3.9 5.1 4.6
------ ----- ------ ------
Income from operations 7.9 8.2 5.9 6.2
Interest expense, net .7 1.3 .8 2.3
------ ----- ------ ------
Income before tax provision 7.2 6.9 5.1 3.9
Tax provision 3.0 3.1 2.1 1.7
------ ----- ------ ------
Net income before warrant accretion 4.2% 3.8% 3.0% 2.2%
====== ===== ====== ======
</TABLE>
The table below sets forth net sales attributable to the Company's
principal operating markets, expressed in dollars (in thousands) and as a
percentage of total net sales. Prior year balances have been restated to conform
with the current presentation.
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 24, September 25, September 24, September 25,
1997 1996 1997 1996
---------------------------------- ----------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Recreation and Leisure $18,922 26.9% $16,534 44.4% $35,964 20.8% $31,001 35.5%
Convention Centers 14,674 20.8 9,856 26.4 41,824 24.1 30,224 34.7
Education 11,753 16.7 6,252 16.8 38,377 22.1 14,369 16.5
Business Dining 14,247 20.2 2,263 6.1 40,507 23.4 7,000 8.0
Healthcare 5,510 7.8 832 2.2 7,148 4.1 1,913 2.2
Corrections 3,379 4.8 1,020 2.7 5,123 3.0 2,023 2.3
Other 1,954 2.8 515 1.4 4,340 2.5 706 .8
-------- ----- -------- ------- --------- ------ ------------------
Total $70,439 100.0% $37,272 100.0% $173,283 100.0% $87,236 100.0%
=================================== ====================================
</TABLE>
Three Months Ended September 24, 1997 Compared to Three Months Ended
September 25, 1996
Net Sales. The Company=s net sales increased 89% to $70.4 million for the
three months ended September 24, 1997 from $37.3 million for the three months
ended September 25, 1996. Net sales increased in all market areas. Recreation
and Leisure net sales increased 14.4% primarily due to the impact of new
contracts such as the University of Georgia in Athens, Georgia and increased
sales attributable to existing contracts such as Pro Player Park in Miami,
Florida. The 48.9% increase in Convention Center net sales is primarily
attributable to the new contract at Tulsa Exposition Center in Tulsa, Oklahoma
and increased sales at the Orange County Convention Center in Orlando, Florida.
Net sales in Education and Business Dining more than doubled, primarily as a
result of the impact of acquisitions in 1996 and 1997. The growth in net sales
in Healthcare and Corrections is primarily the result of the acquisition of Best
Inc. ("Best"). Best specializes in providing food service to healthcare and
corrections markets and to a lesser extent provides food service to the business
dining and education markets.
Gross Profit. Gross profit was $8.5 million or 12.1% of net sales, as
compared to $4.5 million or 12.1% of net sales for the comparable 1996 period.
General and Administrative Expenses. General and administrative expenses
increased to $2.9 million (or 4.2% of net sales) for the three months ended
September 24, 1997 from $1.5 million (or 3.9% of net sales) for the three months
ended September 25, 1996. The increase was attributable primarily to the
Company=s continued investment in accounting, sales personnel and training to
support the Company's growing base of business.
Operating Income. Operating income increased 84% to $5.6 million for the
three months ended September 24, 1997 from $3.0 million for the three months
ended September 25, 1996, primarily as a result of the factors discussed above.
Interest Expense. Interest expense was $491,000 for the three months ended
September 24, 1997. While debt levels increased during the third quarter of 1997
due to the financing of certain acquisitions, interest expense remained constant
as compared to the three months ended September 25, 1996.
Nine Months Ended September 24, 1997 Compared to Nine Months
Ended September 25, 1996
Net Sales. The Company's net sales increased 99% to $173.3 million for the
nine months ended September 24, 1997 from $87.2 million for the nine months
ended September 25, 1996. Net sales increased in all market areas. The 16.0%
increase in Recreation and Leisure is primarily a result of new contracts at the
University of Georgia in Athens, Georgia and Concord Pavilion in Concord,
California and increased sales at Pro Player Park, in Miami, Florida, Great
Woods in Mansfield, MA and South Commons Facilities in Columbus, Georgia. Net
sales from Convention Centers increased 38.4% mainly due to the new contract at
Tulsa Exposition Center in Tulsa, Oklahoma and higher sales at Orange County
Convention Center in Orlando, Florida and Portland Exposition Center in
Portland, Oregon. Net sales in Education and Corporate Dining increased due to
the impact of the 1996 and 1997 acquisitions as well as from the addition of
sixteen new contracts. The growth in net sales in Healthcare and Corrections is
primarily the result of the acquisition of Best.
Gross Profit. Gross profit as a percentage of net sales increased to 11.0%
for the nine months ended September 24, 1997 from 10.8% achieved for the
comparable 1996 period. The increase was primarily from purchasing efficiencies
realized from an expanded base of business.
General and Administrative Expenses. General and administrative expenses
increased to $8.9 million (or 5.1% of net sales) for the nine months ended
September 24, 1997 from $4.0 million (or 4.6% of net sales) for the nine months
ended September 25, 1996. The increase was attributable primarily to the
continued investment in accounting, sales personnel and training to support the
Company's growing base of business.
Operating Income. Operating income increased 87% to $10.1 million for the
nine months ended September 24, 1997 from $5.4 million for the nine months ended
September 25, 1996, primarily as a result of the factors discussed above.
Interest Expense. Interest expense decreased to approximately $1.3 million
for the nine months ended September 24, 1997, due primarily to decreased debt
resulting from the repayment of certain obligations under the Company's credit
facility with the net proceeds from the initial and follow-on public offerings.
Liquidity and Capital Resources
Cash flow from operating activities was a use of funds of approximately $3.2
million and $3.0 million for the nine months ended September 24, 1997 and
September 25, 1996, respectively. The use of funds from operations resulted
primarily as a result of the expansion into the Education, Corrections and
Healthcare markets.
EBITDA was $17.3 million or 10.0% of net sales, compared to $8.7 million or
10.0% of net sales for the nine months ended September 24, 1997 and September
25, 1996, respectively. EBITDA represents earnings before interest expense,
income tax expense, depreciation and amortization. EBITDA is not a measurement
in accordance with GAAP and should not be considered an alternative to, or more
meaningful than, income from operations, net income or cash flows as defined by
GAAP as a measure of the Company=s profitability or liquidity.
Cash flows used in investing activities were approximately $63.6 million and
$13.2 million for the nine months ended September 24, 1997 and September 25,
1996, respectively. The increase in use of funds was primarily a result of
investments in acquired companies and purchases of fixtures and equipment. The
Company has funded its capital requirements from a combination of debt and
equity financing.
During the third quarter, the Company made commitments to invest $27 million
related to the procurement of certain contracts.
On October 3, 1997, the Company acquired 100% of the stock of Total Food
Service Direction, Inc. ("Total"). Total provides contract food services to 35
business dining and educational facilities in southern Florida. The purchase
price was approximately $4.5 million, consisting of cash and subordinated
promissory notes to sellers.
On August 27, 1997, the Company acquired 100% of the stock of Best, Inc.
("Best"). Best provides contract food services to approximately 150 healthcare,
corrections, business dining and education clients in Minnesota, Wisconsin,
North Dakota, South Dakota, Illinois and Iowa. The purchase price was $26.5
million, consisting of cash and assumed debt.
On August 6, 1997, the Company acquired 100% of the stock of Statewide
Industrial Catering, Inc. ("Statewide"). Statewide provides contract food
service to 25 school districts in the New York City Metropolitan Area. The
purchase price was $3.2 million, consisting of cash, assumed debt of Statewide
and a subordinated promissory note.
On December 30, 1996, the Company acquired Service Dynamics for a purchase
price of approximately $3.0 million. On January 22, 1997 the Company acquired
Serv-Rite for a purchase price of approximately $7.5 million.
With respect to the foregoing acquisitions, the Company is eliminating
certain redundant operations through closings of offices and termination of
excess personnel relating to these acquisitions.
At September 24, 1997 and December 25, 1996 the Company=s current assets
exceeded its current liabilities, resulting in a working capital surplus of
$14.2 million and $4.6 million, respectively. The surplus resulted primarily
from an increase in trade receivables related to the new acquisitions in the
Education, Corrections and Healthcare markets, which generally invest in shorter
term assets (i.e., accounts receivable), as compared to the Company=s Recreation
and Leisure business, which invests in longer term assets (i.e., fixtures and
equipment). The Working Capital Line provides funds for liquidity, seasonal
borrowing needs and other general corporate purposes.
On February 12, 1997, the Company completed the Follow-On Offering,
resulting in net proceeds to the Company of approximately $59.1 million after
deducting underwriting discounts and certain expenses. The proceeds of the
follow on offering were used to repay obligations under the Company's then
existing credit agreement and for general working capital purposes.
On July 30, 1997, the Company entered into the Fourth Amended and Restated
Loan Agreement, a $200 million credit facility with Bank Boston, N.A., as
Administrative Agent (the "Administrative Agent"), U.S. Trust, as Documentation
Agent, and certain banks and other financial institutions party thereto (the
"Bank Agreement"). The Bank Agreement provides for (i) a five year working
capital revolving credit line for general corporate purposes and letters of
credit, in the maximum aggregate amount of $50 million (the "Working Capital
Line") and (ii) a line of credit to provide for future expansion by the Company,
in the maximum amount of $150 million (the "Guidance Line"). The Working Capital
Line provides funds for liquidity, seasonal borrowing needs and other general
corporate purposes. The Guidance Line is available on a revolving basis until
July 30, 2000, to fund the Company's acquisitions and for investments made in
connection with facility agreements. At July 30, 2000, all loans outstanding
under the Guidance Line will convert to term loans, payable quarterly over a
three-year period. Interest on all loans under the Bank Agreement will be based
on, at the Company's option, either a prime rate or a LIBOR rate plus an
incremental rate based on a ratio of debt to EBITDA, not to be less than .75% or
greater than 1.5%.
In October 1997, the Company issued, through a private placement pursuant to
Rule 144A under the Securities Act of 1933, $175 million of 5.0% Convertible
Subordinated Notes (the "Notes") due 2004. The Notes are unsecured obligations
of the Company and are convertible into common stock at a conversion price of
$44.50 per share. The net proceeds of $169.1 million, after deducting
underwriting discounts and certain expenses, was used to repay approximately
$50.0 million in outstanding debt under the Bank Agreement. The remaining net
proceeds were invested in short term investments in accordance with the
Company's investment policy. The balance of the net proceeds will be used to
fund acquisitions and for general corporate purposes. The Bank Agreement was
amended prior to the offering to allow for the issuance of up to $200 million of
debt.
The Company believes that the invested proceeds of the Notes and its
Follow-On Offering, internally generated funds and amounts available under the
Bank Agreement are sufficient to satisfy the Company's presently anticipated
capital requirements for at least the next twelve months.
<PAGE>
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Not applicable.
<PAGE>
Part II. Other Information
Item 1. Legal Proceedings
Reference is made to the discussion of legal proceedings found in the
Company's Form 10-K for the fiscal year ended December 25, 1996. There have been
no material changes in the status of the proceedings referenced therein.
The Company is involved in certain legal proceedings incidental to the
normal conduct of its business. The Company does not believe that any
liabilities relating to such legal proceedings to which it is a party are likely
to be, individually or in the aggregate, material to its consolidated financial
position or results of operations.
Item 2. Changes in Securities
On October 27, 1997, the Company issued, through a private placement
pursuant to Rule 144A, under the Securities Act of 1933, $175 million of 5.0%
Convertible Subordinated Notes (the "Notes") due 2004. The Notes are unsecured
obligations of the Company and are convertible into Common Stock at a conversion
price of $44.50 per share. The initial purchasers (the "Initial Purchasers") of
the Notes were Donaldson, Lufkin & Jenrette Securities Corporation, Nationsbanc,
Montgomery Securities, Inc., Smith Barney, Inc. and Piper Jaffray, Inc. The
Initial Purchasers received aggregate discounts and commissions of $5.3 million.
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
A) Exhibits:
1 Purchase Agreement, by and among the Company and Donaldson,
Lufkin & Jenrette Securities Corporation,
Nationsbanc Montgomery Securities, Inc., Smith Barney, Inc.
and Piper Jaffray, Inc., dated as of October 21, 1997.
*3.1 Restated Certificate of Incorporation
*3.2 By-Laws
*4.1 Specimen of Registrant=s Common Stock Certificate
4.2 Indenture between the Company and The Bank of New York, dated as
of October 27, 1997, with respect to $175,000,000 5% Convertible
Subordinated Notes due 2004.
4.3 Registration Rights Agreement, by and among the Company and
Donaldson, Lufkin & Jenrette Securities Corporation, Nationsbanc
Montgomery Securities, Inc., Smith Barney, Inc. and Piper Jaffray,
Inc., dated as of October 27, 1997.
10.1 Fourth Amended and Restated Loan Agreement, dated July 30, 1997,
among the Company, as borrower, its subsidiaries and Bank Boston,
N.A. as administrative agent, U.S. Trust, as documentation agent,
and other financial institutions.
10.2 First Amendment to the Fourth Amended and Restated Loan Agreement
dated August 14, 1997
10.3 Second Amendment to the Fourth Amended and Restated Loan
Agreement, dated October 21, 1997.
10.4 Employment Agreement dated as of August 27, 1997 between Best,Inc.
and Perry Rynders
11 Computations of Per Share Earnings
27 Financial Data Schedule
* Filed as exhibits to the Company=s Registration Statement on Form S-1,
declared effective by the Securities and Exchange Commission on June 19, 1996,
and hereby incorporated by reference.
B) Reports on Form 8-K
A Form 8-K was filed on September 5, 1997 to report the acquisition of Best,
Inc. by the Company, under Item 2 thereof. As permitted by Item 7(a)(4) of Form
8-K , the required financial statements were not filed until November 6, 1997
under cover of Form 8-K/A.
Omitted from this Part II are items which are inapplicable or to which the
answer is negative for the period presented.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Fine Host Corporation
By: /s/ Cynthia J. Robbins
Cynthia J. Robbins
Vice President and Controller
(Duly Authorized Officer and Principal Accounting Officer)
Date: November 7, 1997
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
1 Purchase Agreement, by and among the Company and Donaldson,
Lufkin & Jenrette Securities Corporation,
Nationsbanc Montgomery Securities, Inc., Smith Barney, Inc.
and Piper Jaffray, Inc., dated as of October 21, 1997.
*3.1 Restated Certificate of Incorporation
*3.2 By-Laws
*4.1 Specimen of Registrant=s Common Stock Certificate
4.2 Indenture between the Company and The Bank of New York, dated as
of October 27, 1997, with respect to $175,000,000 5% Convertible
Subordinated Notes due 2004.
4.3 Registration Rights Agreement, by and among the Company and
Donaldson, Lufkin & Jenrette Securities Corporation, Nationsbanc
Montgomery Securities, Inc., Smith Barney, Inc. and Piper Jaffray,
Inc., dated as of October 27, 1997.
10.1 Fourth Amended and Restated Loan Agreement, dated July 30, 1997,
among the Company, as borrower, its subsidiaries and Bank Boston,
N.A. as administrative agent, U.S. Trust, as documentation agent,
and other financial institutions.
10.2 First Amendment to the Fourth Amended and Restated Loan Agreement
dated August 14, 1997
10.3 Second Amendment to the Fourth Amended and Restated Loan
Agreement, dated October 21, 1997.
10.4 Employment Agreement dated as of August 27, 1997 between Best,Inc.
and Perry Rynders
11 Computations of Per Share Earnings
27 Financial Data Schedule
* Filed as exhibits to the Company's Registration Statement on Form S-1,
declared effective by the Securities and Exchange Commission on June 19, 1996,
and hereby incorporated by reference.
Fine Host Corporation
$175,000,000
5% Convertible Subordinated Notes Due 2004
Purchase Agreement
October 21, 1997
Donaldson, Lufkin & Jenrette
Securities Corporation
NationsBanc Montgomery
Securities, Inc.
Smith Barney Inc.
Piper Jaffray Inc.
<PAGE>
$175,000,000
5% Convertible Subordinated Notes due 2004
of Fine Host Corporation
PURCHASE AGREEMENT
October 21, 1997
Donaldson, Lufkin & Jenrette Securities Corporation
NationsBanc Montgomery Securities, Inc.
Smith Barney Inc.
Piper Jaffray Inc.
c/o Donaldson, Lufkin & Jenrette
Securities Corporation
277 Park Avenue
New York, New York 10005
Dear Sirs:
Fine Host Corporation, a Delaware corporation (the "Company"),
proposes to issue and sell to Donaldson, Lufkin & Jenrette Securities
Corporation ("DLJ"), NationsBanc Montgomery Securities, Inc., Smith Barney Inc.,
and Piper Jaffray Inc. (each, an "Initial Purchaser" and, collectively, the
"Initial Purchasers") an aggregate of $175,000,000 in principal amount of its 5%
Convertible Subordinated Notes due 2004 (the "Initial Notes"), subject to the
terms and conditions set forth herein. The Company also proposes to issue and
sell to the Initial Purchasers not more than an additional aggregate $25,000,000
in principal amount of its 5% Convertible Subordinated Notes due 2004 (the
"Additional Notes" and, together with the Initial Notes, the "Notes"), subject
to the terms and conditions set forth herein. The Notes are to be issued
pursuant to the provisions of an indenture (the "Indenture"), to be dated as of
the Closing Date (as defined below), between the Company and The Bank of New
York, as trustee (the "Trustee"). The Notes will be convertible into shares of
the common stock, par value $0.01 per share, of the Company (the "Common Stock")
at an initial conversion rate, subject to adjustment, set forth in the
Indenture. Capitalized terms used but not defined herein shall have the meanings
given to such terms in the Indenture.
The Notes will be offered and sold to the Initial Purchasers
pursuant to one or more exemptions from the registration requirements under the
Securities Act of 1933, as amended (the "Act"). The Company has prepared a
preliminary offering memorandum, dated October 10, 1997 (the "Preliminary
Offering Memorandum") and a final offering memorandum, dated October 21, 1997
(the "Offering Memorandum"), relating to the Notes.
Upon original issuance thereof, and until such time as the
same is no longer required pursuant to the Indenture, the Notes (and all
securities issued in exchange therefor, in substitution thereof or upon
conversion thereof) shall bear the following legend:
"THIS NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER
THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION
HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER (1) REPRESENTS
THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT)(A "QIB"), (B) IT IS ACQUIRING THIS NOTE
IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE
SECURITIES ACT OR (C) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS
DEFINED IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE
SECURITIES ACT (AN "IAI"), (2) AGREES THAT IT WILL NOT RESELL OR
OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY OR ANY OF ITS
SUBSIDIARIES, (B) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE
TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF THE
SECURITIES ACT, (D) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144 UNDER THE SECURITIES ACT, (E) TO AN IAI THAT, PRIOR TO SUCH
TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THIS NOTE
(THE FORM OF WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH
TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS
THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT
SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (F) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO
THE COMPANY) OR (G) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN
INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND
"UNITED STATES" HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF
REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A
PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF
THIS NOTE IN VIOLATION OF THE FOREGOING."
(a) On the basis of the representations, warranties and
covenants contained in this Agreement, and subject to the terms and conditions
contained herein, the Company agrees to issue and sell to the Initial
Purchasers, and the Initial Purchasers agree, severally and not jointly, to
purchase from the Company, the principal amounts of Initial Notes set forth
opposite the name of such Initial Purchaser on Schedule A hereto at a purchase
price equal to 97% of the principal amount thereof (the "Purchase Price"). The
Purchase Price shall not include interest accrued on the Initial Notes during
the period, if any, from the date of original issuance of the Notes to and
including the Closing Date.
(b) On the basis of the representations, warranties and
covenants in this Agreement, and subject to the terms and conditions contained
herein, the Company hereby grants to the Initial Purchasers the right to
purchase at the Initial Purchasers' election on the Option Closing Date (as
defined below) up to $25,000,000 in aggregate principal amount of Additional
Notes. Additional Notes may be purchased by the Initial Purchasers solely for
the purpose of covering over-allotments made in connection with the sale of the
Initial Notes. The Initial Purchasers may exercise their right to purchase
Additional Notes in whole or in part from time to time by giving written notice
thereof (each, an "Exercise Notice") to the Company at any time on one or more
occasions within 30 days after the date of this Agreement. DLJ shall give any
such Exercise Notice on behalf of the Initial Purchasers and such notice shall
specify the aggregate principal amount of Additional Notes to be purchased
pursuant to such exercise and the date for payment and delivery thereof. The
date specified in any such notice (the "Option Closing Date") shall be a
business day (i) no earlier than the Closing Date, (ii) no later than ten
business days after such notice has been given and (iii) no earlier than two
business days after such notice has been given. If any Additional Notes are to
be purchased, each Initial Purchaser, severally and not jointly, agrees to
purchase from the Company the number of Additional Notes which bears the same
proportion to the total number of Additional Notes to be purchased from the
Company as the number of Initial Notes set forth opposite the name of such
Initial Purchaser in Schedule A bears to the total number of Initial Notes at
the purchase price set forth in Section 2(a) hereof. The purchase price for
Additional Notes shall not include interest accrued on the Additional Notes
during the period from the date of original issuance of Notes to and including
the Option Closing Date.
The Initial Purchasers have advised the Company that the
Initial Purchasers will make offers (the "Exempt Resales") of the Notes
purchased hereunder on the terms set forth in the Offering Memorandum, as
amended or supplemented, solely to (i) persons whom the Initial Purchasers
reasonably believe to be "qualified institutional buyers" as defined in Rule
144A under the Act ("QIBs"), (ii) not more than ten other institutional
"accredited investors," as defined in Rule 501(a) (1), (2), (3) or (7) under the
Act, that make certain representations and agreements to the Company (each, an
"Accredited Institution"), and (iii) to persons permitted to purchase the Notes
in offshore transactions in reliance upon Regulation S under the Act (each, a
"Regulation S Purchaser") (such persons specified in clauses (i), (ii) and (iii)
being referred to herein as the "Eligible Purchasers"). The Initial Purchasers
will offer the Notes to Eligible Purchasers initially at a price equal to 100%
of the principal amount thereof. Such price may be changed at any time without
notice.
Holders (including subsequent transferees) of the Notes will
have the registration rights set forth in the registration rights agreement (the
"Registration Rights Agreement"), to be dated the Closing Date, in substantially
the form of Exhibit A hereto, for so long as such Notes constitute "Transfer
Restricted Securities" (as defined in the Registration Rights Agreement).
Pursuant to the Registration Rights Agreement, the Company will agree to file
with the Securities and Exchange Commission (the "Commission") a shelf
registration statement pursuant to Rule 415 under the Act (the "Registration
Statement") relating to the resale by certain holders of the Notes and to use
its best efforts to cause such Registration Statement to be declared and remain
effective and usable for the periods specified in the Registration Rights
Agreement. This Agreement, the Indenture, the Notes and the Registration Rights
Agreement are hereinafter sometimes referred to collectively as the "Operative
Documents."
4. Delivery and Payment.
(a) Delivery of, and payment of the Purchase Price for, the
Initial Notes shall be made at the offices of Latham & Watkins or such other
location as may be mutually acceptable. Such delivery and payment shall be made
at 9:00 a.m. New York City time, on October 27, 1997 or at such other time as
shall be agreed upon by the Initial Purchasers and the Company. The time and
date of such delivery and the payment are herein called the "Closing Date."
(b) Notes sold by the Initial Purchasers to QIBs and
pursuant to Regulations S will be represented by one or more Notes in definitive
global form, registered in the name of Cede & Co., as nominee of the Depository
Trust Company ("DTC"), having an aggregate principal amount corresponding to the
aggregate principal amount of the Notes sold to such QIBs and pursuant to
Regulations S (collectively, the "Global Notes"). Notes sold by the Initial
Purchasers to Accredited Institutions will be represented by one or more Notes
in definitive form, registered in the name of such Accredited Institutions,
having an aggregate principal amount corresponding to the aggregate principal
amount of the Notes sold to such Accredited Institutions (collectively, the
"Accredited Institution Notes"). The Global Notes and the Accredited Institution
Notes shall be delivered by the Company to the Initial Purchasers (or as the
Initial Purchasers direct) in each case with any transfer taxes thereon duly
paid by the Company against payment by the Initial Purchasers of the Purchase
Price thereof by wire transfer in same day funds to the order of the Company.
The Global Notes and the Accredited Institution Notes shall be made available to
the Initial Purchasers for inspection not later than 9:30 a.m., New York City
time, on the business day immediately preceding the Closing Date.
(c) On any Option Closing Date, the Company shall deliver to
the Initial Purchasers, and the obligations of the Initial Purchasers to
purchase the Additional Notes shall be conditioned upon receipt of, supplemental
opinions, certificates and letters confirming as of such date the opinions,
certificates and letters delivered on the Closing Date pursuant to Section 9
hereof.
The Company hereby agrees with the Initial Purchasers as
follows:
(a) To advise the Initial Purchasers promptly and, if
requested by the Initial Purchasers, confirm such advice in writing, (i) of the
issuance by any state securities commission of any stop order suspending the
qualification or exemption from qualification of any Notes for offering or sale
in any jurisdiction designated by the Initial Purchasers pursuant to Section
5(e) hereof, or the initiation of any proceeding by any state securities
commission or any other federal or state regulatory authority for such purpose
and (ii) of the happening of any event during the period referred to in Section
5(c) below that would result in the Offering Memorandum including an untrue
statement of a material fact or omitting to state a material fact necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading. The Company shall use its best efforts to prevent the
issuance of any stop order or order suspending the qualification or exemption of
any Notes under any state securities or Blue Sky laws and, if at any time any
state securities commission or other federal or state regulatory authority shall
issue an order suspending the qualification or exemption of any Notes under any
state securities or Blue Sky laws, the Company shall use its best efforts to
obtain the withdrawal or lifting of such order at the earliest possible time.
(b) To furnish the Initial Purchasers and those persons
identified by the Initial Purchasers to the Company as many copies of the
Preliminary Offering Memorandum and the Offering Memorandum, and any amendments
or supplements thereto, as the Initial Purchasers may reasonably request for the
time period specified in Section 5(c). Subject to the Initial Purchasers'
compliance with its representations and warranties and agreements set forth in
Section 7 hereof, the Company consents to the use of the Preliminary Offering
Memorandum and the Offering Memorandum, and any amendments and supplements
thereto required pursuant hereto, by the Initial Purchasers in connection with
Exempt Resales.
(c) During such period as in the opinion of counsel for the
Initial Purchasers an Offering Memorandum is required by law to be delivered in
connection with Exempt Resales by the Initial Purchasers and in connection with
market-making activities of the Initial Purchasers for so long as any Notes are
outstanding, (i) not to make any amendment or supplement to the Offering
Memorandum of which the Initial Purchasers shall not previously have been
advised or to which the Initial Purchasers shall reasonably object after being
so advised (except to the extent any amendment or supplement to which the
Initial Purchasers shall have objected is necessary in the opinion of counsel to
the Company to make the statements therein not misleading) and (ii) to prepare
promptly upon the Initial Purchasers' reasonable request, any amendment or
supplement to the Offering Memorandum which may be necessary or advisable in
connection with such Exempt Resales or such market-making activities (except to
the extent any amendment or supplement would in the opinion of counsel to the
Company make the statements therein misleading).
(d) If, during the period referred to in Section 5(c) above,
any event shall occur or condition shall exist as a result of which, in the
opinion of counsel to the Initial Purchasers, it becomes necessary to amend or
supplement the Offering Memorandum in order to make the statements therein, in
the light of the circumstances when such Offering Memorandum is delivered to an
Eligible Purchaser, not misleading, or if, in the opinion of counsel to the
Initial Purchasers, it is necessary to amend or supplement the Offering
Memorandum to comply with any applicable law, forthwith to prepare an
appropriate amendment or supplement to such Offering Memorandum so that the
statements therein, as so amended or supplemented, will not, in the light of the
circumstances when it is so delivered, be misleading or so that such Offering
Memorandum will comply with applicable law (except in each case to the extent
any amendment or supplement would in the opinion of counsel to the Company make
the statements therein misleading), and to furnish to the Initial Purchasers and
such other persons as the Initial Purchasers may designate such number of copies
thereof as the Initial Purchasers may reasonably request.
(e) Prior to the sale of all Notes pursuant to Exempt
Resales as contemplated hereby, to cooperate with the Initial Purchasers and
counsel to the Initial Purchasers in connection with the registration or
qualification of the Notes for offer and sale to the Initial Purchasers and
pursuant to Exempt Resales under the securities or Blue Sky laws of such
jurisdictions as the Initial Purchasers may request and to continue such
registration or qualification in effect so long as required for Exempt Resales
and to file such consents to service of process or other documents as may be
necessary in order to effect such registration or qualification; provided,
however, that the Company shall not be required in connection therewith to
qualify as a foreign corporation in any jurisdiction in which it is not now so
qualified or to take any action that would subject it to general consent to
service of process or taxation in any jurisdiction in which it is not now so
subject.
(f) So long as the Notes are outstanding, (i) to mail and
make generally available as soon as practicable after the end of each fiscal
year to the record holders of the Notes a financial report of the Company and
its subsidiaries on a consolidated basis (and a similar financial report of all
unconsolidated subsidiaries, if any), all such financial reports to include a
consolidated balance sheet, a consolidated statement of operations, a
consolidated statement of cash flows and a consolidated statement of
shareholders' equity as of the end of and for such fiscal year, together with
comparable information as of the end of and for the preceding year, certified by
the Company's independent public accountants and (ii) to mail and make generally
available as soon as practicable after the end of each quarterly period (except
for the last quarterly period of each fiscal year) to such holders, a
consolidated balance sheet, a consolidated statement of operations and a
consolidated statement of cash flows (and similar financial reports of all
unconsolidated subsidiaries, if any) as of the end of and for such period, and
for the period from the beginning of such year to the close of such quarterly
period, together with comparable information for the corresponding periods of
the preceding year.
(g) So long as the Notes are outstanding, to furnish to the
Initial Purchasers as soon as available copies of all reports or other
communications furnished by the Company to its security holders or furnished to
or filed with the Commission or any national securities exchange on which any
class of securities of the Company is listed and such other publicly available
information concerning the Company and/or its subsidiaries as the Initial
Purchasers may reasonably request.
(h) So long as any of the Notes remain outstanding and
during any period in which the Company is not subject to Section 13 or 15(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), to make
available to any holder of Notes in connection with any sale thereof and any
prospective purchaser of such Notes from such holder, the information ("Rule
144A Information") required by Rule 144A(d)(4) under the Act.
(i) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or cause to be
paid all expenses incident to the performance of the obligations of the Company
under this Agreement, including: (i) the fees, disbursements and expenses of
counsel to the Company and accountants of the Company in connection with the
sale and delivery of the Notes to the Initial Purchasers and pursuant to Exempt
Resales, and all other fees and expenses in connection with the preparation,
printing, filing and distribution of the Preliminary Offering Memorandum, the
Offering Memorandum and all amendments and supplements to any of the foregoing
(including financial statements), including the mailing and delivering of copies
thereof to the Initial Purchasers and persons designated by it in the quantities
specified herein, (ii) all costs and expenses related to the transfer and
delivery of the Notes to the Initial Purchasers and pursuant to Exempt Resales,
including any transfer or other taxes payable thereon, (iii) all costs of
printing or producing this Agreement, the other Operative Documents and any
other agreements or documents in connection with the offering, purchase, sale or
delivery of the Notes, (iv) all expenses in connection with the registration or
qualification of the Notes for offer and sale under the securities or Blue Sky
laws of the several states and all costs of printing or producing any
preliminary and supplemental Blue Sky memoranda in connection therewith
(including the filing fees and fees and disbursements of counsel for the Initial
Purchasers in connection with such registration or qualification and memoranda
relating thereto), (v) all expenses and listing fees in connection with the
application for quotation of the Notes in the National Association of Securities
Dealers, Inc. ("NASD") Automated Quotation System - PORTAL ("PORTAL"), (vi) the
fees and expenses of the Trustee and the Trustee's counsel in connection with
the Indenture and the Notes, (vii) the costs and charges of any transfer agent,
registrar and/or depository (including DTC), (viii) any fees charged by rating
agencies for the rating of the Notes, (ix) all costs and expenses of the
Registration Statement as set forth in the Registration Rights Agreement, and
(x) and all other costs and expenses incident to the performance of the
obligations of the Company hereunder for which provision is not otherwise made
in this Section, it being understood that the fees and expenses of counsel to
the Initial Purchasers (other than Blue Sky fees and expenses) shall be borne by
the Initial Purchasers.
(j) To use its best efforts to effect the inclusion of the
Notes in PORTAL and to maintain the listing of the Notes on PORTAL for so long
as any Notes outstanding are not registered under the Act.
(k) To obtain the approval of DTC for "book-entry" transfer
of the Notes, and to comply in all material respects with all of its agreements
set forth in the representation letters of the Company to DTC relating to the
approval of the Notes by DTC for "book-entry" transfer.
(l) Not to issue, sell, contract to sell or otherwise
dispose of any Common Stock or any securities convertible into or exchangeable
or exercisable for Common Stock, for a period of 90 days following the date of
this Agreement, without the prior written consent of DLJ on behalf of the
Initial Purchasers; provided that the Company may issue Common Stock upon the
exercise of (i) the Notes, (ii) outstanding stock options or warrants or (iii)
stock options issued pursuant to existing stock option plans and employee
benefit plans.
(m) Not to sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in the Act) that
would be integrated with the sale of the Notes to the Initial Purchasers or
pursuant to Exempt Resales in a manner that would require the registration of
any such sale of the Notes under the Act.
(n) Not to voluntarily claim, and to actively resist any
attempts to claim, the benefit of any usury laws against the holders of any
Notes.
(o) To use its best efforts to do and perform in all
material respects all things required or necessary to be done and performed
under this Agreement by it prior to the Closing Date and to satisfy in all
material respects all conditions precedent to the delivery of the Notes.
6. Representations, Warranties and Agreements of the
Company. As of the date hereof, the Company represents and warrants to, and
agrees with, the Initial Purchasers that:
(a) The Offering Memorandum does not, and any supplement or
amendment thereto will not, contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, except that the representations and warranties
contained in this paragraph (a) shall not apply to statements in or omissions
from the Offering Memorandum (or any supplement or amendment thereto) based upon
information relating to the Initial Purchasers furnished to the Company in
writing by the Initial Purchasers expressly for use therein. No stop order
preventing the use of the Preliminary Offering Memorandum or the Offering
Memorandum, or any amendment or supplement thereto, or any order asserting that
any of the transactions contemplated by this Agreement are subject to the
registration requirements of the Act, has been issued.
(b) The Company's Significant Subsidiaries, as defined under
Rule 1-02 of Regulation S-X (the "Significant Subsidiaries") are listed in
Schedule B hereto. The Company and each of its subsidiaries have been duly
incorporated and are validly existing as corporations in good standing under the
laws of their respective jurisdictions of incorporation, with full power and
authority (corporate and other) to own and lease their properties and conduct
their respective businesses as described in the Offering Memorandum, except as
would not have a material adverse effect on the business, prospects, financial
condition or results of operations of the Company and its subsidiaries taken as
a whole (a "Material Adverse Effect"); the Company owns all of the outstanding
capital stock of its subsidiaries free and clear of all claims, liens, charges
and encumbrances; the Company and each of its subsidiaries are in possession of
and operating in compliance with all authorizations, licenses, permits,
consents, certificates and orders material to the conduct of their respective
businesses, all of which are valid and in full force and effect except where the
failure to possess or be operating in compliance with such authorizations,
licenses, permits, consents, certificates or orders would not have a Material
Adverse Effect; the Company and each of its subsidiaries are duly qualified to
do business and in good standing as foreign corporations in each jurisdiction in
which the ownership or leasing of properties or the conduct of their respective
businesses requires such qualification, except for jurisdictions in which the
failure to so qualify would not have a Material Adverse Effect; and, to the
knowledge of the Company, no proceeding has been instituted in any such
jurisdiction, revoking, limiting or curtailing, or seeking to revoke, limit or
curtail, such power and authority or qualification.
(c) The Company has an authorized and outstanding capital
stock as set forth under the heading "Capitalization" in the Offering
Memorandum; the issued and outstanding shares of Common Stock of the Company
have been duly authorized and validly issued, are fully paid and nonassessable,
have been issued in compliance with all federal and state securities laws, were
not be issued in violation of any preemptive rights or other rights to subscribe
for or purchase securities or subject to any such rights, and conform in all
material respects to the description thereof contained in the Offering
Memorandum. All issued and outstanding shares of capital stock of each
subsidiary have been duly authorized and validly issued and are fully paid and
nonassessable. Except as disclosed in or contemplated by the Offering Memorandum
and the financial statements of the Company, and the related notes thereto,
included in the Offering Memorandum, neither the Company nor any subsidiary has
outstanding any options to purchase, or any preemptive rights or other rights to
subscribe for or to purchase, any securities or obligations convertible into, or
any contracts or commitments to issue or sell, shares of its capital stock or
any such options, rights, convertible securities or obligations. The description
of the Company's stock option, stock bonus and other stock plans or
arrangements, and the options or other rights granted and exercised thereunder,
set forth in the Offering Memorandum accurately and fairly presents the
information required to be shown with respect to such plans, arrangements,
options and rights.
(d) This Agreement has been duly authorized, executed and
delivered by the Company.
(e) The Indenture has been duly authorized by the Company
and, on the Closing Date, will have been validly executed and delivered by the
Company. Assuming the due authorization, valid execution and delivery by the
Trustee, when the Indenture has been duly executed and delivered by the Company,
the Indenture will be a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms except as (i) the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and (ii) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles of
general applicability. On the Closing Date, the Indenture will conform in all
material respects to the requirements of the Trust Indenture Act of 1939, as
amended (the "TIA" or "Trust Indenture Act"), and the rules and regulations of
the Commission applicable to an indenture which is qualified thereunder except
that the Indenture will not be so qualified.
(f) The Notes have been duly authorized and, on the Closing
Date, will have been validly executed and delivered by the Company. When the
Notes have been issued, executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by the Initial
Purchasers in accordance with the terms of this Agreement and the Indenture, the
Notes will be entitled to the benefits of the Indenture and will be valid and
binding obligations of the Company, enforceable against the Company in
accordance with their terms except as (i) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting creditors' rights
generally and (ii) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applicability. On the
Closing Date, the Notes will conform in all material respects to the description
thereof contained in the Offering Memorandum.
(g) The Registration Rights Agreement has been duly
authorized by the Company and, on the Closing Date, will have been duly executed
and delivered by the Company. Assuming the due authorization, valid execution
and delivery by each of the Initial Purchasers, when the Registration Rights
Agreement has been duly executed and delivered by the Company, the Registration
Rights Agreement will be a valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms except as (i) the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and (ii) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles of
general applicability. On the Closing Date, the Registration Rights Agreement
will conform in all material respects to the description thereof in the Offering
Memorandum.
(h) The shares of Common Stock initially to be issued by the
Company upon conversion of the Notes have been duly authorized and reserved for
issuance upon such conversion and, when issued, delivered and paid for upon such
conversion in the manner set forth in the Indenture, will be duly authorized,
validly issued, fully paid and nonassessable, and will conform in all material
respects to the description thereof contained in the Offering Memorandum. No
preemptive rights or other rights to subscribe for or purchase any security of
the Company exist with respect to the issuance and sale of the Common Stock by
the Company pursuant to the Indenture (other than those which have been waived).
No stockholder of the Company has any right to require the Company to register
the sale of any shares owned by such stockholder under the Act in the shelf
registration statement contemplated by the Registration Rights Agreement that
will not have been irrevocably waived prior to such registration. No further
approval or authority of the stockholders or the Board of Directors of the
Company will be required for the issuance and sale of the Common Stock upon
conversion of the Notes as contemplated in the Indenture.
(i) The making and performance of this Agreement and the
other Operative Documents by the Company, compliance by the Company with all the
provisions hereof and thereof and the consummation of the transactions
contemplated herein and therein will not violate any provision of the
certificate of incorporation or bylaws, or other organizational documents, of
the Company or any of its subsidiaries, and will not conflict with, result in
the breach or violation of, or constitute, either by itself or upon notice or
the passage of time or both, a default under any agreement, mortgage, deed of
trust, lease, franchise, license, indenture, permit or other instrument to which
the Company or any of its subsidiaries is a party or by which the Company or any
of its subsidiaries or any of its respective properties may be bound or
affected, any statute or any authorization, judgment, decree, order, rule or
regulation of any court or any regulatory body, administrative agency or other
governmental body applicable to the Company or any of its subsidiaries or any of
their respective properties except for such conflicts, breaches or violations or
defaults which would not have a Material Adverse Effect. No consent, approval,
authorization or other order of any court, regulatory body, administrative
agency or other governmental body is required for the execution and delivery of
this Agreement or the consummation of the transactions contemplated by this
Agreement, except for compliance with (i) the Act and the Blue Sky laws
applicable to the private offering of the Notes by the Initial Purchasers and
(ii) the Exchange Act and the TIA as applicable to the shelf registration
statement filed pursuant to the Registration Rights Agreement.
(j) Except as disclosed in the Offering Memorandum, and
except as to defaults which individually or in the aggregate would not be
material to the Company and its subsidiaries taken as a whole, neither the
Company nor any of its subsidiaries is in violation or default of any provision
of its certificate of incorporation or bylaws, or other organizational
documents, or is in breach of or default with respect to any provision of any
agreement, judgment, decree, order, mortgage, deed of trust, lease, franchise,
license, indenture, permit or other instrument to which it is a party or by
which it or any of its properties are bound; and there does not exist any state
of facts which constitutes an event of default on the part of the Company or any
such subsidiary as defined in such documents or which, with notice or lapse of
time or both, would constitute such an event of default, which event of default
would result in a Material Adverse Effect.
(k) There are no contracts or other documents required to be
described in the Offering Memorandum which have not been described or filed. The
contracts so described in Offering Memorandum are in full force and effect on
the date hereof, except as would not have a Material Adverse Effect; and neither
the Company nor any of its subsidiaries, nor to the best of the Company's
knowledge, any other party is in breach of or default under any of such
contracts, except as would not have a Material Adverse Effect.
(l) Except as disclosed in the Offering Memorandum, there
are no legal or governmental actions, suits or proceedings pending or, to the
best of the Company's knowledge, threatened to which the Company or any of its
subsidiaries is or may be a party or of which property owned or leased by the
Company or any of its subsidiaries is or may be the subject, or related to
environmental or discrimination matters, which actions, suits or proceedings
might, individually or in the aggregate, prevent or adversely affect the
Company's ability to consummate the transactions contemplated by this Agreement
or result in a Material Adverse Effect; and no labor disturbance by the
employees of the Company or any of its subsidiaries exists or, to the Company's
knowledge, is imminent which might be expected to result in a Material Adverse
Effect. Neither the Company nor any of its subsidiaries is a party or subject to
the provisions of any material injunction, judgment, decree or order of any
court, regulatory body, administrative agency or other governmental body.
(m) The Company or the applicable subsidiary has good and
marketable title to all the properties and assets reflected as owned in the
financial statements described herein (or elsewhere in the Offering Memorandum),
subject to no lien, mortgage, pledge, charge or encumbrance of any kind except
(i) those, if any, reflected in such financial statements (or elsewhere in the
Offering Memorandum), or (ii) those which are not material in amount and do not
materially adversely affect the use made and proposed to be made of such
property by the Company and its subsidiaries. The Company or the applicable
subsidiary holds its leased properties under valid and binding leases, with such
exceptions as are not materially significant in relation to the business of the
Company. Except as disclosed in the Offering Memorandum, the Company owns or
leases all such properties as are necessary to its operations as now conducted.
(n) Since the respective dates as of which information is
given in the Offering Memorandum other than as set forth in the Offering
Memorandum (exclusive of any amendments or supplements thereto subsequent to the
date of this Agreement): (i) the Company and its subsidiaries have not incurred
any material liabilities or obligations, indirect, direct or contingent, or
entered into any material agreement or other transaction which is not in the
ordinary course of business or which could result in a material reduction in the
future earnings of the Company and its subsidiaries; (ii) the Company and its
subsidiaries have not sustained any material loss or interference with their
respective businesses or properties from fire, flood, windstorm, accident or
other calamity, whether or not covered by insurance; (iii) the Company has not
paid or declared any dividends or other distributions with respect to its
capital stock and the Company and its subsidiaries are not in default in the
payment of principal or interest on any outstanding debt obligations; (iv) there
has not been any change in the capital stock or indebtedness material to the
Company and its subsidiaries (other than in the ordinary course of business and
as otherwise contemplated by this Agreement); and (v) there has not been any
material adverse change in the condition (financial or otherwise), business,
properties, results of operations or prospects of the Company and its
subsidiaries taken as a whole.
(o) Except as disclosed in or specifically contemplated by
the Offering Memorandum, the Company and its subsidiaries have sufficient
trademarks, trade names, patent rights, mask works, copyrights, licenses,
approvals and governmental authorizations to conduct their businesses as now
conducted; except for "Fine Host" and the Company's pear symbol, the expiration
of any trademarks, trade names, patent rights, mask works, copyrights, licenses,
approvals or governmental authorizations would not have a material adverse
effect on the condition (financial or otherwise), business, results of
operations or prospects of the Company and its subsidiaries taken as a whole;
and the Company has no knowledge of any material infringement by it or its
subsidiaries of trademark, trade name rights, patent rights, mask works,
copyrights, licenses, trade secret or other similar rights of others, and the
Company has no knowledge of any claim being made against the Company or its
subsidiaries regarding trademark, trade name, patent, mask work, copyright,
license, trade secret or other infringement which could have a material adverse
effect on the condition (financial or otherwise), business, results of
operations or prospects of the Company and its subsidiaries taken as a whole.
(p) The Company has not been advised, and has no reason to
believe, that either it or any of its subsidiaries is not conducting business in
compliance with all applicable laws, rules and regulations of the jurisdictions
in which it is conducting business, including, without limitation, all
applicable local, state and federal environmental laws and regulations; except
where failure to be so in compliance would not result in a Material Adverse
Effect.
(q) The Company and its subsidiaries have filed all federal,
state and foreign income and franchise tax returns required to be filed and have
paid all taxes shown as due thereon other than those being contested in good
faith and as to which adequate reserves have been established; and the Company
has no knowledge of any tax deficiency which has been or might be asserted or
threatened against the Company or its subsidiaries which could result in a
Material Adverse Effect.
(r) The Company has not distributed and will not distribute
prior to the Closing Date any offering material in connection with the offering
and sale of the Notes other than the Preliminary Offering Memorandum dated
October 10, 1997, and the Offering Memorandum.
(s) Each of the Company and its subsidiaries maintains
insurance of the types and in amounts which the Company believes to be adequate
for its business, including, but not limited to, insurance covering real and
personal property owned or leased by the Company and its subsidiaries against
theft, damage, destruction, acts of vandalism and all other risks customarily
insured against, all of which insurance is in full force and effect except where
the failure to maintain such insurance would not have a Material Adverse Effect.
(t) Neither the Company nor any of its subsidiaries has at
any time during the last five years (i) made any unlawful contribution to any
candidate for foreign office, or failed to disclose fully any contribution in
violation of law, or (ii) made any payment to any federal or state governmental
officer or official, or other person charged with similar public or quasi-public
duties, other than payments required or permitted by the laws of the United
States of any jurisdiction thereof.
(u) The Company has not taken and will not take, directly or
indirectly, any action designed to or that might be reasonably expected to cause
or result in stabilization or manipulation of the price of the Notes or the
Common Stock underlying the Notes to facilitate the sale or resale of the Notes.
(v) Neither the Company nor any of its subsidiaries has
violated any foreign, federal, state or local law or regulation relating to the
protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("Environmental Laws") or any
provisions of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or the rules and regulations promulgated thereunder, except for such
violations which, singly or in the aggregate, would not have a Material Adverse
Effect.
(w) There are no costs or liabilities associated with
Environmental Laws (including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or compliance with
Environmental Laws or any Authorization, any related constraints on operating
activities and any potential liabilities to third parties) which would, singly
or in the aggregate, have a Material Adverse Effect.
(x) Each of the Company and its subsidiaries has such
permits, licenses, consents, exemptions, franchises, authorizations and other
approvals (each, an "Authorization") of, and has made all filings with and
notices to, all governmental or regulatory authorities and self-regulatory
organizations and all courts and other tribunals, including without limitation,
under any applicable Environmental Laws, as are necessary to own, lease, license
and operate its respective properties and to conduct its business, except where
the failure to have any such Authorization or to make any such filing or notice
would not, singly or in the aggregate, have a Material Adverse Effect. Each such
Authorization is valid and in full force and effect and each of the Company and
its subsidiaries is in compliance in all material respects with all the terms
and conditions thereof and with the rules and regulations of the authorities and
governing bodies having jurisdiction with respect thereto; and no event has
occurred (including, without limitation, the receipt of any notice from any
authority or governing body) which allows or, after notice or lapse of time or
both, would allow, revocation, suspension or termination of any such
Authorization or results or, after notice or lapse of time or both, would result
in any other impairment of the rights of the holder of any such Authorization;
and such Authorizations contain no restrictions that are unduly burdensome to
the Company or any of its subsidiaries; except where such failure to be valid
and in full force and effect or to be in compliance, the occurrence of any such
event or the presence of any such restriction would not, singly or in the
aggregate, have a Material Adverse Effect.
(y) The accountants, Deloitte & Touche LLP, that have
certified the financial statements and supporting schedules included in the
Preliminary Offering Memorandum and the Offering Memorandum are independent
public accountants with respect to the Company, as required by the Act and the
Exchange Act. The historical financial statements, together with related
schedules and notes, set forth in the Preliminary Offering Memorandum and the
Offering Memorandum comply as to form in all material respects with the
requirements applicable to registration statements on Form S-3 under the Act.
(z) The historical financial statements, together with
related schedules and notes forming part of the Offering Memorandum (and any
amendment or supplement thereto), present fairly the consolidated financial
position, results of operations and changes in financial position of the Company
and its subsidiaries on the basis stated in the Offering Memorandum at the
respective dates or for the respective periods to which they apply; such
statements and related schedules and notes have been prepared in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved, except as disclosed therein; and the other financial and
statistical information and data set forth in the Offering Memorandum (and any
amendment or supplement thereto) are, in all material respects, accurately
presented and prepared on a basis consistent with such financial statements and
the books and records of the Company.
(aa) The Company is not and, after giving effect to the
offering and sale of the Notes and the application of the net proceeds thereof
as described in the Offering Memorandum, will not be, an "investment company,"
as such term is defined in the Investment Company Act of 1940, as amended.
(bb) Neither the Company nor any of its subsidiaries nor any
agent thereof acting on the behalf of them has taken, and none of them will
take, any action that might cause this Agreement or the issuance or sale of the
Notes to violate Regulation G (12 C.F.R. Part 207), Regulation T (12 C.F.R. Part
220), Regulation U (12 C.F.R. Part 221) or Regulation X (12 C.F.R. Part 224) of
the Board of Governors of the Federal Reserve System.
(cc) no "nationally recognized statistical rating
organization" as such term is defined for purposes of Rule 436(g)(2) under the
Act (i) has imposed (or has informed the Company that it is considering
imposing) any condition (financial or otherwise) on the Company's retaining any
rating assigned to the Company or any securities of the Company or (ii) has
indicated to the Company that it is considering (a) the downgrading, suspension,
or withdrawal of, or any review for a possible change that does not indicate the
direction of the possible change in, any rating so assigned or (b) any change in
the outlook for any rating of the Company or any securities of the Company.
(dd) Each of the Preliminary Offering Memorandum and the
Offering Memorandum, as of its date, contains all the information specified in,
and meeting the requirements of, Rule 144A(d)(4) under the Act.
(ee) When the Notes are issued and delivered pursuant to
this Agreement, the Notes will not be of the same class (within the meaning of
Rule 144A under the Act) as any security of the Company that is listed on a
national securities exchange registered under Section 6 of the Exchange Act or
that is quoted in a United States automated inter-dealer quotation system.
(ff) No form of general solicitation or general advertising
(as defined in Regulation D under the Act) was used by the Company or any of its
representatives (other than the Initial Purchasers, as to whom the Company makes
no representation) in connection with the offer and sale of the Notes
contemplated hereby, including, but not limited to, articles, notices or other
communications published in any newspaper, magazine, or similar medium or
broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising. No
securities of the same class as the Notes have been issued and sold by the
Company within the six-month period immediately prior to the date hereof.
(gg) None of the Company nor any of its affiliates or any
person acting on its or their behalf (other than the Initial Purchasers, as to
whom the Company makes no representation) has engaged or will engage in any
directed selling efforts within the meaning of Regulation S under the Act
("Regulation S") with respect to the Notes.
(hh) The Notes offered and sold in reliance on Regulation S
have been and will be offered and sold only in offshore transactions.
(ii) The sale of the Notes pursuant to Regulation S is not
part of a plan or scheme to evade the registration provisions of the Act.
(jj) The Company and its affiliates and all persons acting
on its behalf (other than the Initial Purchasers, as to whom the Company makes
no representation) have complied with and will comply with the offering
restrictions requirements of Regulation S in connection with the offering of the
Notes outside the United States and, in connection therewith, the Offering
Memorandum will contain the disclosure required by Rule 902(h).
(kk) The Company is a "reporting issuer", as defined in Rule
902 under the Act.
(ll) No registration under the Act of the Notes is required
for the sale of the Notes to the Initial Purchasers as contemplated hereby or
for the Exempt Resales assuming the accuracy of (i) the Initial Purchasers'
representations and warranties and agreements set forth in Section 7 hereof and
(ii) as to any Accredited Institution, the representations and warranties and
agreements set forth in the Accredited Investor Letter attached as Annex A to
the Offering Memorandum.
(mm) Each certificate signed by any officer of the Company
and delivered to the Initial Purchasers or counsel for the Initial Purchasers
shall be deemed to be a representation and warranty by the Company to the
Initial Purchasers as to the matters covered thereby.
The Company acknowledges that the Initial Purchasers and,
for purposes of the opinions to be delivered to the Initial Purchasers pursuant
to Section 9 hereof, counsel to the Company and counsel to the Initial
Purchasers will rely upon the accuracy and truth of the foregoing
representations and hereby consents to such reliance.
7. Initial Purchasers' Representations and Warranties. Each
of the Initial Purchasers, severally and not jointly, represents and warrants to
the Company, and agrees that:
(a) Such Initial Purchaser is either a QIB or an Accredited
Institution, in either case, with such knowledge and experience in financial and
business matters as is necessary in order to evaluate the merits and risks of an
investment in the Notes.
(b) Such Initial Purchaser (A) is not acquiring the Notes
with a view to any distribution thereof or with any present intention of
offering or selling any of the Notes in a transaction that would violate the Act
or the securities laws of any state of the United States or any other applicable
jurisdiction and (B) will be reoffering and reselling the Notes only to (x) QIBs
in reliance on the exemption from the registration requirements of the Act
provided by Rule 144A, (y) not more than ten Accredited Institutions that
execute and deliver a letter containing certain representations and agreements
in the form attached as Annex A to the Offering Memorandum and (z) in offshore
transactions in reliance upon Regulation S under the Act.
(c) Such Initial Purchaser agrees that no form of general
solicitation or general advertising (within the meaning of Regulation D under
the Act) has been or will be used by such Initial Purchaser or any of its
representatives in connection with the offer and sale of the Notes pursuant
hereto, including, but not limited to, articles, notices or other communications
published in any newspaper, magazine or similar medium or broadcast over
television or radio, or any seminar or meeting whose attendees have been invited
by any general solicitation or general advertising.
(d) Such Initial Purchaser agrees that, in connection with
Exempt Resales, such Initial Purchaser will solicit offers to buy the Notes only
from, and will offer to sell the Notes only to, Eligible Purchasers. Each
Initial Purchaser further agrees that it will offer to sell the Notes only to,
and will solicit offers to buy the Notes only from (A) Eligible Purchasers that
the Initial Purchasers reasonably believe are QIBs, (B) Accredited Institutions
who make the representations contained in, and execute and return to the Initial
Purchasers, a certificate in the form of Annex A attached to the Offering
Memorandum and (C) Regulation S Purchasers, in each case, that agree that (x)
the Notes purchased by them may be resold, pledged or otherwise transferred
within the time period referred to under Rule 144(k) (taking into account the
provisions of Rule 144(d) under the Act, if applicable) under the Act, as in
effect on the date of the transfer of such Notes, only (I) to the Company or any
of its subsidiaries, (II) to a person whom the seller reasonably believes is a
QIB purchasing for its own account or for the account of a QIB in a transaction
meeting the requirements of Rule 144A under the Act, (III) in an offshore
transaction (as defined in Rule 902 under the Act) meeting the requirements of
Rule 904 of the Act, (IV) in a transaction meeting the requirements of Rule 144
under the Act, (V) to an Accredited Institution that, prior to such transfer,
furnishes the Trustee a signed letter containing certain representations and
agreements relating to the registration of transfer of such Note (the form of
which is substantially the same as Annex A to the Offering Memorandum) and, if
such transfer is in respect of an aggregate principal amount of Notes less than
$250,000, an opinion of counsel acceptable to the Company that such transfer is
in compliance with the Act, (VI) in accordance with another exemption from the
registration requirements of the Act (and based upon an opinion of counsel
acceptable to the Company) or (VII) pursuant to an effective registration
statement and, in each case, in accordance with the applicable securities laws
of any state of the United States or any other applicable jurisdiction and (y)
they will deliver to each person to whom such Notes or an interest therein is
transferred a notice substantially to the effect of the foregoing.
(e) None of such Initial Purchaser nor any of its affiliates
or any person acting on its or their behalf has engaged or will engage in any
directed selling efforts within the meaning of Regulation S with respect to the
Notes.
(f) The Notes offered and sold by such Initial Purchaser
pursuant hereto in reliance on Regulation S have been and will be offered and
sold only in offshore transactions.
(g) The sale of the Notes offered and sold by such Initial
Purchaser pursuant hereto in reliance on Regulation S is not part of a plan or
scheme to evade the registration provisions of the Act.
(h) Such Initial Purchaser agrees that it has not offered or
sold and will not offer or sell the Notes in the United States or to, or for the
benefit or account of, a U.S. Person (other than a distributor), in each case,
as defined in Rule 902 under the Act (i) as part of its distribution at any time
and (ii) otherwise until 40 days after the later of the commencement of the
offering of the Notes pursuant hereto and the Closing Date, other than in
accordance with Regulation S of the Act or another exemption from the
registration requirements of the Act. Such Initial Purchaser agrees that, during
such 40-day restricted period, it will not cause any advertisement with respect
to the Notes (including any "tombstone" advertisement) to be published in any
newspaper or periodical or posted in any public place and will not issue any
circular relating to the Notes, except such advertisements as are permitted by
and include the statements required by Regulation S.
(i) Such Initial Purchaser agrees that, at or prior to
confirmation of a sale of Notes by it to any distributor, dealer or person
receiving a selling concession, fee or other remuneration during the 40-day
restricted period referred to in Rule 903(c)(2) under the Act, it will send to
such distributor, dealer or person receiving a selling concession, fee or other
remuneration a confirmation or notice to substantially the following effect:
"The Notes covered hereby have not been registered under the U.S.
Securities Act of 1933, as amended (the "Securities Act"), and may not
be offered and sold within the United States or to, or for the account
or benefit of, U.S. persons (i) as part of your distribution at any
time or (ii) otherwise until 40 days after the later of the
commencement of the Offering and the Closing Date, except in either
case in accordance with Regulation S under the Securities Act (or Rule
144A or to Accredited Institutions in transactions that are exempt from
the registration requirements of the Securities Act), and in connection
with any subsequent sale by you of the Notes covered hereby in reliance
on Regulation S during the period referred to above to any distributor,
dealer or person receiving a selling concession, fee or other
remuneration, you must deliver a notice to substantially the foregoing
effect. Terms used above have the meanings assigned to them in
Regulation S."
(j) Such Initial Purchaser further represents and agrees
that (1) it has not offered or sold and will not offer or sell any Notes to
persons in the United Kingdom prior to the expiration of the period of six
months from the issue date of the Notes, except to persons whose ordinary
activities involve them in acquiring, holding, managing or disposing of
investments (as principal or agent) for the purposes of their business or
otherwise in circumstances which have not resulted and will not result in an
offer to the public in the United Kingdom within the meaning of the Public
Offers of Securities Regulations 1995, (ii) it has complied and will comply with
all applicable provisions of the Financial Services Act 1986 with respect to
anything done by it in relation to the Notes in, from or otherwise involving the
United Kingdom and (iii) it has only issued or passed on and will only issue or
pass on in the United Kingdom any document received by it in connection with the
issuance of the Notes to a person who is of a kind described in Article 11(3) of
the Financial Services Act of 1986 (Investment Advertisements) (Exemptions)
Order 1996 or is a person to whom the document may otherwise lawfully be issued
or passed on.
(k) Such Initial Purchaser agrees that it will not offer,
sell or deliver any of the Notes in any jurisdiction outside the United States
except under circumstances that will result in compliance with the applicable
laws thereof, and that it will take at its own expense whatever action is
required to permit its purchase and resale of the Notes in such jurisdictions.
Such Initial Purchaser understands that no action has been taken to permit a
public offering in any jurisdiction outside the United States where action would
be required for such purpose.
The Initial Purchasers acknowledge that the Company and, for
purposes of the opinions to be delivered to each Initial Purchaser pursuant to
Section 9 hereof, counsel to the Company and counsel to the Initial Purchasers
will rely upon the accuracy and truth of the foregoing representations and the
Initial Purchasers hereby consent to such reliance.
8. Indemnification.
(a) The Company agrees to indemnify and hold harmless each
Initial Purchaser, its directors and officers and each person, if any, who
controls such Initial Purchaser within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages, liabilities and judgments (including, without limitation, any legal or
other expenses incurred in connection with investigating or defending any
matter, including any action, that could give rise to any such losses, claims,
damages, liabilities or judgments) caused by any untrue statement or alleged
untrue statement of a material fact contained in the Offering Memorandum (or any
amendment or supplement thereto), the Preliminary Offering Memorandum or any
Rule 144A Information provided by the Company to any holder or prospective
purchaser of Notes pursuant to Section 5(h) or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, except insofar as such losses, claims,
damages, liabilities or judgments are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon information relating
to the Initial Purchaser furnished in writing to the Company by such Initial
Purchaser. The Company acknowledges that the statements set forth in (i) the
last paragraph of the cover page, (ii) the first paragraph on page ii, (iii) the
fourth and fifth sentences of the first paragraph under the caption "Risk
Factors--Absence of Existing Market for Notes" and (iv) the entire fourth
paragraph, the second sentence of the fifth paragraph and the entire eleventh
paragraph under the caption "Plan of Distribution" in each case in the
Preliminary Offering Memorandum and the Offering Memorandum constitute the only
such information. The foregoing indemnity shall not inure to the benefit of any
Initial Purchaser on account of any losses, claims, damages, liabilities or
judgments arising from the sale of the Notes by such Initial Purchaser to any
person if a copy of the Offering Memorandum (as supplemented or amended) shall
not have been delivered or sent to such person at or prior to the written
confirmation of the initial resale of such Notes to such person and the untrue
statement or omission contained in such Preliminary Offering Memorandum was
corrected in the Offering Memorandum (as supplemented or amended), provided that
the Company has delivered the Offering Memorandum (as supplemented or amended)
to the Initial Purchasers in requisite quantity on a timely basis to permit such
delivery or sending.
(b) Each Initial Purchaser agrees, severally and not
jointly, to indemnify and hold harmless the Company, and its directors and
officers and each person, if any, who controls (within the meaning of Section 15
of the Act or Section 20 of the Exchange Act) the Company, to the same extent as
the foregoing indemnity from the Company to the Initial Purchasers but only with
reference to information relating to such Initial Purchaser furnished in writing
to the Company by such Initial Purchaser expressly for use in the Preliminary
Offering Memorandum or the Offering Memorandum.
(c) In case any action shall be commenced involving any
person in respect of which indemnity may be sought pursuant to Section 8(a) or
8(b) (the "indemnified party"), the indemnified party shall promptly notify the
person against whom such indemnity may be sought (the "indemnifying party") in
writing and the indemnifying party shall assume the defense of such action,
including the employment of counsel reasonably satisfactory to the indemnified
party and the payment of all fees and expenses of such counsel, as incurred
(except that in the case of any action in respect of which indemnity may be
sought pursuant to both Sections 8(a) and 8(b), the Initial Purchasers shall not
be required to assume the defense of such action pursuant to this Section 8(c),
but may employ separate counsel and participate in the defense thereof, but the
fees and expenses of such counsel, except as provided below, shall be at the
expense of the Initial Purchasers). Any indemnified party shall have the right
to employ separate counsel in any such action and participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
the indemnified party unless (i) the employment of such counsel shall have been
specifically authorized in writing by the indemnifying party, (ii) the
indemnifying party shall have failed to assume the defense of such action or
employ counsel reasonably satisfactory to the indemnified party or (iii) the
named parties to any such action (including any impleaded parties) include both
the indemnified party and the indemnifying party, and the indemnified party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the indemnifying party (in which case the indemnifying party shall
not have the right to assume the defense of such action on behalf of the
indemnified party). In any such case, the indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for all indemnified parties
and all such fees and expenses shall be reimbursed as they are incurred. Such
firm shall be designated in writing by DLJ on behalf of the Initial Purchasers,
in the case of the parties indemnified pursuant to Section 8(a), and by the
Company, in the case of parties indemnified pursuant to Section 8(b). The
indemnifying party shall indemnify and hold harmless the indemnified party from
and against any and all losses, claims, damages, liabilities and judgments by
reason of any settlement of any action (i) effected with the written consent of
the indemnifying party or (ii) effected without the written consent of the
indemnifying party if the settlement is entered into more than twenty business
days after the indemnifying party shall have received a request from the
indemnified party for reimbursement for the fees and expenses of counsel (in any
case where such fees and expenses are at the expense of the indemnifying party)
and, prior to the date of such settlement, the indemnifying party shall have
failed to comply with such reimbursement request. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement or compromise of, or consent to the entry of judgment with respect
to, any pending or threatened action in respect of which the indemnified party
is or could have been a party and indemnity or contribution may be or could have
been sought hereunder by the indemnified party, unless such settlement,
compromise or judgment (i) includes an unconditional release of the indemnified
party from all liability on claims that are or could have been the subject
matter of such action and (ii) does not include a statement as to or an
admission of fault, culpability or a failure to act, by or on behalf of the
indemnified party.
(d) To the extent the indemnification provided for in this
Section 8 is unavailable to an indemnified party or insufficient in respect of
any losses, claims, damages, liabilities or judgments referred to therein, then
each indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, on the one hand, and the Initial Purchasers on the other hand from the
offering of the Notes or (ii) if the allocation provided by clause 8(d)(i) above
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause 8(d)(i) above but
also the relative fault of the Company, on the one hand, and the Initial
Purchasers, on the other hand, in connection with the statements or omissions
which resulted in such losses, claims, damages, liabilities or judgments, as
well as any other relevant equitable considerations. The relative benefits
received by the Company, on the one hand, and the Initial Purchasers, on the
other hand, shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Notes (before deducting expenses) received by
the Company, and the total discounts and commissions received by the Initial
Purchasers bear to the total price to investors of the Notes, in each case as
set forth in the table on the cover page of the Offering Memorandum. The
relative fault of the Company, on the one hand, and the Initial Purchasers, on
the other hand, shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company, on the one hand, or the Initial Purchasers, on the other hand, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Company and the Initial Purchasers agree that it would
not be just and equitable if contribution pursuant to this Section 8(d) were
determined by pro rata allocation (even if the Initial Purchasers were treated
as one entity for such purpose) or by any other method of allocation which does
not take account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities or judgments referred to in
the immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses incurred by such
indemnified party in connection with investigating or defending any matter,
including any action, that could have given rise to such losses, claims,
damages, liabilities or judgments. Notwithstanding the provisions of this
Section 8, the Initial Purchasers shall not be required to contribute any amount
in excess of the amount by which the total discounts and commissions received by
such Initial Purchasers exceeds the amount of any damages which the Initial
Purchasers have otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Initial Purchasers' obligations to contribute
pursuant to this Section 8(d) are several in proportion to the respective
principal amount of Notes purchased by each of the Initial Purchasers hereunder
and not joint.
(e) The remedies provided for in this Section 8 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
9. Conditions of Initial Purchasers' Obligations. The
obligations of the Initial Purchasers to purchase the Notes under this Agreement
are subject to the satisfaction of each of the following conditions:
(a) All the representations and warranties of the Company
contained in this Agreement shall be true and correct on the Closing Date, in
the case of Initial Notes, or on the Option Closing Date, in the case of
Additional Notes, in each case with the same force and effect as if made on and
as of such date.
(b) On or after the date hereof, (i) there shall not have
occurred any downgrading, suspension or withdrawal of, nor shall any notice have
been given of any potential or intended downgrading, suspension or withdrawal
of, or of any review (or of any potential or intended review) for a possible
change that does not indicate the direction of the possible change in, any
rating of the Company or any securities of the Company (including, without
limitation, the placing of any of the foregoing ratings on credit watch with
negative or developing implications or under review with an uncertain direction)
by any "nationally recognized statistical rating organization" as such term is
defined for purposes of Rule 436(g)(2) under the Act, (ii) there shall not have
occurred any change, nor shall any notice have been given of any potential or
intended change, in the outlook for any rating of the Company or any securities
of the Company by any such rating organization and (iii) no such rating
organization shall have given notice that it has assigned (or is considering
assigning) a lower rating to the Notes than that on which the Notes were
marketed.
(c) Since the respective dates as of which information is
given in the Offering Memorandum other than as set forth in the Offering
Memorandum (exclusive of any amendments or supplements thereto subsequent to the
date of this Agreement), (i) there shall not have occurred any change or any
development involving a prospective change in the condition, financial or
otherwise, or the earnings, business, management or operations of the Company
and its subsidiaries, taken as a whole, (ii) there shall not have been any
change or any development involving a prospective change in the capital stock or
in the long-term debt of the Company or any of its subsidiaries and (iii)
neither the Company nor any of its subsidiaries shall have incurred any
liability or obligation, direct or contingent, the effect of which, in any such
case described in clause 9(c)(i), 9(c)(ii) or 9(c)(iii), in your reasonable
judgment, is material and adverse and, in your reasonable judgment, makes it
impracticable to market the Notes on the terms and in the manner contemplated in
the Offering Memorandum.
(d) You shall have received on the Closing Date, in the case
of Initial Notes, or on the Option Closing Date, in the case of Additional
Notes, a certificate dated as of such date, signed by the President and the
Chief Financial Officer of the Company, confirming the matters set forth in
Sections 9(a) and 9(b) and stating that the Company has complied in all material
respects with all the agreements and satisfied in all material respects all of
the conditions herein contained and required to be complied with or satisfied on
or prior to the Closing Date or the Option Closing Date, as the case may be.
(e) You shall have received on the Closing Date, in the case
of Initial Notes, and on the Option Closing Date, in the case of Additional
Notes, an opinion (satisfactory to you and counsel for the Initial Purchasers),
dated as of such date, of Willkie Farr & Gallagher, counsel for the Company, to
the effect that:
(i) the Company has been duly incorporated,
is validly existing as a corporation in good standing under
the laws of its jurisdiction of incorporation and has the
corporate power and authority to carry on its business as
described in the Offering Memorandum and to own, lease and
operate its properties;
(ii) each of the Company and its Significant
Subsidiaries is duly qualified and is in good standing as a
foreign corporation authorized to do business in each
jurisdiction in which the nature of its business or its
ownership or leasing of property requires such qualification,
except where the failure to be so qualified would not have a
Material Adverse Effect;
(iii) all the outstanding shares of capital
stock of the Company have been duly authorized and validly
issued and are fully paid, non-assessable and not subject to
any preemptive or similar rights;
(iv) all of the outstanding shares of
capital stock of each of the Company's Significant
Subsidiaries have been duly authorized and validly issued and
are fully paid and non-assessable, and are owned by the
Company, free and clear of any Lien;
(v) this Agreement has been duly authorized,
executed and delivered by the Company;
(vi) the Indenture has been duly authorized,
executed and delivered by the Company and, assuming the due
authorization, valid execution and delivery by the Trustee, is
a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms except as (x)
the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights
generally, (y) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of
general applicability and (z) to provisions relating to
indemnities or contribution, as to each of which such counsel
need express no opinion;
(vii) the Notes have been duly authorized
and, when executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by
the Initial Purchasers in accordance with the terms of this
Agreement and the Indenture, will be entitled to the benefits
of the Indenture and will be valid and binding obligations of
the Company, enforceable against the Company in accordance
with their terms except as (x) the enforceability thereof may
be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally and (y) rights of acceleration and
the availability of equitable remedies may be limited by
equitable principles of general applicability, as to each of
which such counsel need express no opinion;
(viii) the Registration Rights Agreement has
been duly authorized, executed and delivered by the Company
and, assuming the due authorization, valid execution and
delivery by each of the Initial Purchasers, is a valid and
binding agreement of the Company, enforceable against the
Company in accordance with its terms except as (x) the
enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights
generally, (y) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of
general applicability and (z) to provisions relating to
indemnities or contribution, as to each of which such counsel
need express no opinion;
(ix) the shares of Common Stock initially
issuable upon conversion of the Notes in accordance with the
Indenture have been duly authorized and reserved for issuance
upon such conversion and, when issued upon such conversion,
will be validly issued by the Company, fully paid and
nonassessable; and the stockholders of the Company have no
preemptive rights under the Company's certificate of
incorporation with respect to the Notes or the shares of
Common Stock issuable upon conversion of the Notes;
(x) the statements under the captions
"Description of Credit Facility" and "Description of Notes" in
the Offering Memorandum, insofar as such statements constitute
a summary of the legal matters, documents or proceedings
referred to therein, fairly present in all material respects
such legal matters, documents and proceedings;
(xi) the execution, delivery and performance
of this Agreement and the other Operative Documents by the
Company, the compliance by the Company with all provisions
hereof and thereof and the consummation of the transactions
contemplated hereby and thereby will not (i) require any
consent, approval, authorization or other order of, or
qualification with, any court or governmental body or agency
(except such as may be required under the securities or Blue
Sky laws of the various states and, with respect to the
Registration Statement, as required under the Act, the
Exchange Act and the TIA), (ii) conflict with or constitute a
breach of any of the terms or provisions of, or a default
under, (a) the charter or by-laws of the Company or any of its
Significant Subsidiaries or (b) any indenture, loan agreement,
mortgage, lease or other agreement or instrument that is
material to the Company and its subsidiaries, taken as a
whole, to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries or
their respective property is bound, (iii) violate or conflict
with any applicable law or any rule, regulation, judgment,
order or decree of any court or any governmental body or
agency having jurisdiction over the Company, any of its
Significant Subsidiaries or their respective property, or (iv)
result in the imposition or creation of (or the obligation to
create or impose) a Lien under, any agreement or instrument to
which the Company or any of its Significant Subsidiaries is a
party or by which the Company or any of its Significant
Subsidiaries or their respective property is bound, except,
with respect to clauses (i), (ii) (b), (iii) and (iv), as
would not result in a Material Adverse Effect;
(xii) to the best of such counsel's
knowledge, neither the Company nor any of its Significant
Subsidiaries is in violation of its respective charter or
by-laws;
(xiii) such counsel does not know of any
legal or governmental proceedings pending or threatened to
which the Company or any of its Significant Subsidiaries is or
could be a party or to which any of their respective property
is or could be subject, which is reasonably likely to result,
singly or in the aggregate, in a Material Adverse Effect;
(xiv) the Company is not and, after giving
effect to the offering and sale of the Notes and the
application of the net proceeds thereof as described in the
Offering Memorandum, will not be, an "investment company" as
such term is defined in the Investment Company Act of 1940, as
amended;
(xv) to the best of such counsel's knowledge
except as disclosed in the Offering Memorandum, there are no
contracts, agreements or understandings between the Company
and any person granting such person the right to require the
Company to file a registration statement under the Act with
respect to any securities of the Company or to require the
Company to include such securities with the Notes registered
pursuant to any Registration Statement;
(xvi) the Indenture complies as to form in
all material respects with the requirements of the TIA, and
the rules and regulations of the Commission applicable to an
indenture which is qualified thereunder except that the
Indenture will not be so qualified. It is not necessary in
connection with the offer, sale and delivery of the Notes to
the Initial Purchasers in the manner contemplated by this
Agreement or in connection with the Exempt Resales to qualify
the Indenture under the TIA;
(xvii) no registration under the Act of the
Notes is required for the sale of the Notes to the Initial
Purchasers as contemplated by this Agreement or for the Exempt
Resales assuming that (i) each Initial Purchaser is a QIB, an
Accredited Institution or a Regulation S Purchaser, (ii) the
accuracy of, and compliance with, the Initial Purchasers'
representations and agreements contained in Section 7 of this
Agreement, (iii) the compliance with, and accuracy of, the
agreements and representations of the Company set forth in
Sections 5(h) and (m) and 6(ee), (ff), (gg), (hh), (ii), (jj)
and (kk) of this Agreement and (iv) with respect to Accredited
Institutions, the accuracy of the representations made by each
such Accredited Institution as set forth in the letter of
representation executed by such Accredited Institution in the
form of Annex A to the Offering Memorandum.
In addition, such counsel shall state that they have
participated in conferences with officers and other representatives of the
Company, representatives of the independent certified public accountants of the
Company and the Initial Purchasers at which the contents of the Preliminary
Offering Memorandum and the Offering Memorandum and any amendment thereof or
supplement thereto and related matters were discussed and, although such counsel
has not undertaken to investigate or verify independently, and does not assume
any responsibility for, the accuracy, completeness or fairness of the statements
contained in the Preliminary Offering Memorandum and the Offering Memorandum or
any amendment thereof or supplement thereto, on the basis of the foregoing
(relying as to materiality to the extent such counsel has deemed appropriate
upon the opinions of officers and other representatives of the Company), no
facts have come to the attention of such counsel that would lead them to believe
that the Offering Memorandum as of its date or as of the date hereof, contained
or contains any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading (it being understood that in each such case such counsel expresses no
belief or opinion with respect to the financial statements and schedules and
other financial or statistical data included therein).
The opinion of Willkie Farr & Gallagher described in Section
9(e) above shall be rendered to you at the request of the Company and shall so
state therein.
(f) The Initial Purchasers shall have received on the
Closing Date, in the case of Initial Notes, or on the Option Closing Date, in
the case of Additional Notes, an opinion, dated as of such date, of Latham &
Watkins, counsel for the Initial Purchasers, in form and substance reasonably
satisfactory to the Initial Purchasers.
(g) The Initial Purchasers shall have received, at the time
this Agreement is executed and at the Closing Date and Option Closing Date,
letters dated the date hereof, the Closing Date or the Option Closing Date, as
the case may be, in form and substance satisfactory to the Initial Purchasers
from Deloitte & Touche LLP, independent public accountants, containing the
information and statements of the type ordinarily included in accountants'
"comfort letters" to the Initial Purchasers with respect to the financial
statements and certain financial information contained in the Offering
Memorandum.
(h) The Notes shall have been approved by the NASD for
trading and duly listed in PORTAL.
(i) The Initial Purchasers shall have received a
counterpart, conformed as executed, of the Indenture which shall have been
entered into by the Company and the Trustee.
(j) The Company shall have executed the Registration Rights
Agreement and the Initial Purchasers shall have received an original copy
thereof, duly executed by the Company.
(k) The Company shall have received from BankBoston, N.A.,
and from each lender under the Company's Fourth Amended and Restated Loan
Agreement dated as of June 30, 1997, an irrevocable consent to the offering of
the Notes and shall deliver a copy of such consent to the Initial Purchasers.
(l) The Company shall not have failed at or prior to the
Closing Date, in the case of Initial Notes, or at or prior to the Option Closing
Date, in the case of Additional Notes, to perform or comply in any material
respect with any of the agreements herein contained and required to be performed
or complied with by the Company at or prior to the Closing Date or the Option
Closing Date, as the case may be.
10. Effectiveness of Agreement and Termination. This
Agreement shall become effective upon the execution and delivery of this
Agreement by the parties hereto.
This Agreement may be terminated at any time on or prior to
the Closing Date by the Initial Purchasers by written notice to the Company if
any of the following has occurred: (i) any outbreak or escalation of hostilities
or other national or international calamity or crisis or change in economic
conditions or in the financial markets of the United States or elsewhere that,
in the Initial Purchasers' judgment, is material and adverse and, in the Initial
Purchasers' judgment, makes it impracticable to market the Notes on the terms
and in the manner contemplated in the Offering Memorandum, (ii) the suspension
or material limitation of trading in securities or other instruments on the New
York Stock Exchange, the American Stock Exchange, the Chicago Board of Options
Exchange, the Chicago Mercantile Exchange, the Chicago Board of Trade or the
Nasdaq National Market or limitation on prices for securities or other
instruments on any such exchange or the Nasdaq National Market, (iii) the
suspension of trading of any securities of the Company on any exchange or in the
over-the-counter market, (iv) the enactment, publication, decree or other
promulgation of any federal or state statute, regulation, rule or order of any
court or other governmental authority which in your opinion materially and
adversely affects, or will materially and adversely affect, the business,
prospects, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole, (v) the declaration of a banking moratorium by
either federal or New York State authorities or (vi) the taking of any action by
any federal, state or local government or agency in respect of its monetary or
fiscal affairs which in your opinion has a material adverse effect on the
financial markets in the United States.
If on the Closing Date any one or more of the Initial
Purchasers shall fail or refuse to purchase the Notes which it or they have
agreed to purchase hereunder on such date and the aggregate principal amount of
the Notes which such defaulting Initial Purchaser or Initial Purchasers, as the
case may be, agreed but failed or refused to purchase is not more than one-tenth
of the aggregate principal amount of the Notes to be purchased on such date by
all Initial Purchasers, each non-defaulting Initial Purchaser shall be obligated
severally, in the proportion which the principal amount of the Notes set forth
opposite its name in Schedule B bears to the aggregate principal amount of the
Notes which all the non-defaulting Initial Purchasers, as the case may be, have
agreed to purchase, or in such other proportion as you may specify, to purchase
the Notes which such defaulting Initial Purchaser or Initial Purchasers, as the
case may be, agreed but failed or refused to purchase on such date; provided
that in no event shall the aggregate principal amount of the Notes which any
Initial Purchaser has agreed to purchase pursuant to Section 2 hereof be
increased pursuant to this Section 10 by an amount in excess of one-ninth of
such principal amount of the Notes without the written consent of such Initial
Purchaser. If on the Closing Date any Initial Purchaser or Initial Purchasers
shall fail or refuse to purchase the Notes and the aggregate principal amount of
the Notes with respect to which such default occurs is more than one-tenth of
the aggregate principal amount of the Notes to be purchased by all Initial
Purchasers and arrangements satisfactory to the Initial Purchasers and the
Company for purchase of such the Notes are not made within 48 hours after such
default, this Agreement will terminate without liability on the part of any
non-defaulting Initial Purchaser and the Company. In any such case which does
not result in termination of this Agreement, either you or the Company shall
have the right to postpone the Closing Date, but in no event for longer than
seven days, in order that the required changes, if any, in the Offering
Memorandum or any other documents or arrangements may be effected. Any action
taken under this paragraph shall not relieve any defaulting Initial Purchaser
from liability in respect of any default of any such Initial Purchaser under
this Agreement.
11. Miscellaneous. Notices given pursuant to any provision
of this Agreement shall be addressed as follows: (i) if to the Company, to Fine
Host Corporation, 3 Greenwich Office Park, Greenwich, Connecticut 06831,
Attention: General Counsel and (ii) if to the Initial Purchasers, Donaldson,
Lufkin & Jenrette Securities Corporation, 277 Park Avenue, New York, New York
10172, Attention: Syndicate Department, or in any case to such other address as
the person to be notified may have requested in writing.
The respective indemnities, contribution agreements,
representations, warranties and other statements of the Company and the Initial
Purchasers set forth in or made pursuant to this Agreement shall remain
operative and in full force and effect, and will survive delivery of and payment
for the Notes, regardless of (i) any investigation, or statement as to the
results thereof, made by or on behalf of the Initial Purchasers, the officers or
directors of the Initial Purchasers, any person controlling the Initial
Purchasers, the Company, the officers or directors of the Company, or any person
controlling the Company, (ii) acceptance of the Notes and payment for them
hereunder and (iii) termination of this Agreement.
If for any reason the Notes are not delivered by or on behalf
of the Company as provided herein (other than as a result of any termination of
this Agreement pursuant to Section 10 or any material breach by an Initial
Purchaser not otherwise cured pursuant to Section 10), the Company agrees to
reimburse the Initial Purchasers for all out-of-pocket expenses incurred by
them. Notwithstanding any termination of this Agreement, the Company shall be
liable for all expenses which it has agreed to pay pursuant to Section 5(i)
hereof. The Company also agrees to reimburse the Initial Purchasers and its
officers, directors and each person, if any, who controls any Initial Purchaser
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act
for any and all fees and expenses (including without limitation the fees and
expenses of counsel) incurred by them in connection with enforcing their rights
under this Agreement (including without limitation its rights under this Section
11).
Except as otherwise provided, this Agreement has been and is
made solely for the benefit of and shall be binding upon the Company, the
Initial Purchasers, the Initial Purchasers' directors and officers, any
controlling persons referred to herein, the directors of the Company and their
respective successors and assigns, all as and to the extent provided in this
Agreement, and no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" shall not include a
purchaser of any of the Notes from the Initial Purchasers merely because of such
purchase.
This Agreement shall be governed and construed in accordance
with the laws of the State of New York.
This Agreement may be signed in various counterparts which
together shall constitute one and the same instrument.
<PAGE>
Please confirm that the foregoing correctly sets forth the
agreement among the Company and the Initial Purchasers.
Very truly yours,
Fine Host Corporation
By:__________________________
Name:
Title:
Donaldson, Lufkin & Jenrette
Securities Corporation
By:__________________________
Name:
Title:
NationsBanc Montgomery
Securities, Inc.
By:__________________________
Name:
Title:
Smith Barney Inc.
By:__________________________
Name:
Title:
Piper Jaffray Inc.
By:__________________________
Name:
Title:
<PAGE>
S-2
SCHEDULE A
Principal Amount
Initial Purchaser ..................... of Notes
Donaldson, Lufkin & Jenrette
Securities Corporation ............ $ 43,750,000
NationsBanc Montgomery Securities, Inc. $ 43,750,000
Smith Barney Inc. ..................... $ 43,750,000
Piper Jaffray Inc. .................... $ 43,750,000
-----------
Total ........................ $175,000,000
===========
<PAGE>
SCHEDULE B
Significant Subsidiaries
1. Best, Inc.
<PAGE>
EXHIBIT A
Form of Registration Rights Agreement
FINE HOST CORPORATION
Issuer,
and
THE BANK OF NEW YORK,
Trustee
INDENTURE
Dated as of October 27, 1997
$200,000,000
5% Convertible Subordinated Notes due 2004
<PAGE>
iv
TABLE OF CONTENTS
Page
ARTICLE I. DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1. Definitions....................................................1
Section 1.2. Incorporation by Reference of TIA..............................8
Section 1.3. Rules of Construction..........................................8
ARTICLE II........THE NOTES
Section 2.1. Form and Dating................................................9
Section 2.2. Execution and Authentication...................................9
Section 2.3. Registrar and Paying Agent....................................10
Section 2.4. Paying Agent to Hold Assets in Trust..........................10
Section 2.5. Noteholder Lists..............................................11
Section 2.6. Transfer and Exchange.........................................11
Section 2.7. Replacement Notes.............................................16
Section 2.8. Outstanding Notes.............................................16
Section 2.9. Treasury Notes................................................17
Section 2.10. Temporary Notes..............................................17
Section 2.11. Cancellation.................................................17
Section 2.12. Defaulted Interest...........................................17
Section 2.13. CUSIP Numbers................................................18
ARTICLE III.......REDEMPTION
Section 3.1. Right of Redemption...........................................19
Section 3.2. Notices to Trustee............................................19
Section 3.3. Selection of Notes to Be Redeemed.............................19
Section 3.4. Notice of Redemption..........................................19
Section 3.5. Effect of Notice of Redemption................................20
Section 3.6. Deposit of Redemption Price...................................21
Section 3.7. Notes Redeemed in Part........................................21
ARTICLE IV........COVENANTS
Section 4.1. Payment of Notes..............................................21
Section 4.2. Maintenance of Office or Agency...............................22
Section 4.3. Corporate Existence...........................................22
Section 4.4. Payment of Taxes and Other Claims.............................22
Section 4.5. Maintenance of Properties and Insurance.......................23
Section 4.6. Compliance Certificate; Notice of Default.....................23
Section 4.7. Reports.......................................................23
Section 4.8. Limitation on Status as Investment Company....................24
Section 4.9. Waiver of Stay, Extension or Usury Laws.......................24
Section 4.10. Rule 144A Information Requirement............................24
ARTICLE V.........SUCCESSOR CORPORATION
Section 5.1. Limitation on Merger, Sale or Consolidation...................24
Section 5.2. Successor Corporation Substituted.............................25
ARTICLE VI........EVENTS OF DEFAULT AND REMEDIES
Section 6.1. Events of Default.............................................25
Section 6.2. Acceleration of Maturity, Rescission and Annulment............27
Section 6.3. Collection of Indebtedness and Suits for Enforcement by
Trustee....................................................................28
Section 6.4. Trustee May File Proofs of Claim..............................28
Section 6.5. Trustee May Enforce Claims Without Possession of Notes........29
Section 6.6. Priorities....................................................29
Section 6.7. Limitation on Suits...........................................30
Section 6.8. Unconditional Right of Holders to Receive Principal, Premium,
Interest and Liquidated Damages............................................30
Section 6.9. Rights and Remedies Cumulative................................31
Section 6.10. Delay or Omission Not Waiver.................................31
Section 6.11. Control by Holders...........................................31
Section 6.12. Waiver of Past Default.......................................31
Section 6.13. Undertaking for Costs........................................32
Section 6.14. Restoration of Rights and Remedies...........................32
ARTICLE VII. TRUSTEE
Section 7.1. Duties of Trustee.............................................32
Section 7.2. Rights of Trustee.............................................33
Section 7.3. Individual Rights of Trustee..................................34
Section 7.4. Trustee's Disclaimer..........................................34
Section 7.5. Notice of Default.............................................35
Section 7.6. Reports by Trustee to Holders.................................35
Section 7.7. Compensation and Indemnity....................................35
Section 7.8. Replacement of Trustee........................................36
Section 7.9. Successor Trustee by Merger, Etc..............................37
Section 7.10. Eligibility; Disqualification................................37
Section 7.11. Preferential Collection of Claims Against Company............37
Section 7.12. Other Capacities.............................................37
ARTICLE VIII. SATISFACTION AND DISCHARGE
Section 8.1. Satisfaction and Discharge of Indenture.......................38
Section 8.2. Repayment to the Company......................................38
ARTICLE IX........AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 9.1. Supplemental Indentures Without Consent of Holders............38
Section 9.2. Amendments, Supplemental Indentures and Waivers with Consent of
Holders....................................................................39
Section 9.3. Compliance with TIA...........................................40
Section 9.4. Revocation and Effect of Consents.............................40
Section 9.5. Notation on or Exchange of Notes..............................40
Section 9.6. Trustee to Sign Amendments, Etc...............................41
ARTICLE X.........MEETINGS OF NOTEHOLDERS
Section 10.1. Purposes for Which Meetings May Be Called....................41
Section 10.2. Manner of Calling Meetings...................................41
Section 10.3. Calling of Meetings by the Company or Holders................42
Section 10.4. Who May Attend and Vote at Meetings..........................42
Section 10.5. Regulations May Be Made by Trustee; Conduct of the Meeting:
Voting Rights: Adjournment.................................................42
Section 10.6. Voting at the Meeting and Record to Be Kept..................43
Section 10.7. Exercise of Rights of Trustee or Holders May Not Be Hindered or
Delayed by Call of Meeting.................................................43
ARTICLE XI........ RIGHT TO REQUIRE REPURCHASE UPON A CHANGE OF CONTROL
Section 11.1. Repurchase of Notes at Option of the Holder Upon a Change of
Control....................................................................43
Section 11.2. Rescission of Change of Control Determination................45
ARTICLE XII. SUBORDINATION
Section 12.1. Notes Subordinated to Senior Indebtedness....................46
Section 12.2. No Payment on Notes in Certain Circumstances.................46
Section 12.3. Notes Subordinated to Prior Payment of All Senior Indebtedness
on Dissolution Liquidation or Reorganization...............................47
Section 12.4. Noteholders to Be Subrogated to Rights of Holders of Senior
Indebtedness...............................................................48
Section 12.5. Obligations of the Company Unconditional.....................48
Section 12.6. Trustee and Other Agents Entitled to Assume Payments Not
Prohibited in Absence of Notice............................................49
Section 12.7. Application by Trustee of Assets Deposited with It...........49
Section 12.8. Subordination Rights Not Impaired by Acts or Omissions of the
Company or Holders of Senior Indebtedness..................................49
Section 12.9. Noteholders Authorize Trustee to Effectuate Subordination of
Notes......................................................................50
Section 12.10. Right of Trustee to Hold Senior Indebtedness................50
Section 12.11. Article XII Not to Prevent Events of Default................50
Section 12.12. No Duty of Trustee and Other Agents to Holders of Senior
Indebtedness...............................................................50
ARTICLE XIII. CONVERSION OF NOTES
Section 13.1. Conversion Privilege.........................................51
Section 13.2. Exercise of Conversion Privilege.............................51
Section 13.3. Fractional Interests.........................................52
Section 13.4. Conversion Price.............................................52
Section 13.5. Adjustment of Conversion Price...............................52
Section 13.6. Continuation of Conversion Privilege in Case of
Reclassification, Change, Merger, Consolidation or Sale of
Assets.....................................................................56
Section 13.7. Notice of Certain Events.....................................57
Section 13.8. Taxes on Conversion..........................................58
Section 13.9. Company to Provide Stock.....................................58
Section 13.10. Disclaimer of Responsibility for Certain Matters............59
Section 13.11. Return of Funds Deposited for Redemption of Converted Notes.59
ARTICLE XIV. MISCELLANEOUS
Section 14.1. TIA Controls.................................................59
Section 14.2. Notices......................................................59
Section 14.3. Communications by Holders with Other Holders.................60
Section 14.4. Certificate and Opinion as to Conditions Precedent...........60
Section 14.5. Statements Required in Certificate or Opinion................61
Section 14.6. Rules by Trustee, Paying Agent, Registrar....................61
Section 14.7. Legal Holidays...............................................61
Section 14.8. Governing Law................................................61
Section 14.9. No Adverse Interpretation of Other Agreements................62
Section 14.10. No Recourse Against Others..................................62
Section 14.11. Successors..................................................62
Section 14.12. Duplicate Originals.........................................62
Section 14.13. Severability................................................62
Section 14.14. Table of Contents, Headings, Etc............................62
Section 14.15. Qualification of Indenture..................................62
Section 14.16. Registration Rights.........................................63
EXHIBIT A - Form of Note.....................................................A-1
EXHIBIT B - Accredited Investor Letter.......................................B-1
EXHIBIT C - Form of Conversion Notice........................................B-1
<PAGE>
CROSS-REFERENCE TABLE
TIA Indenture
Section Section
- ------- -------
310(a)(1) 7.10
(a)(2) 7.10
(a)(3) N.A.
(a)(4) N.A.
(a)(5) 7.10
(b) 7.8; 7.10; 14.2
(c) N.A.
311(a) 7.11
(b) 7.11
(c) N.A.
312(a) 2.5
(b) 14.3
(c) 14.3
313(a) 7.6
(b)(1) N.A.
(b)(2) 7.6
(c) 7.6; 14.2
(d) 7.6
314(a) 4.6; 13.2
(b) N.A.
(c)(1) 2.2; 7.2; 14.4
(c)(2) 7.2; 14.4
(c)(3) N.A.
(d) N.A.
(e) 14.5
(f) N.A.
315(a) 7.1(b)
(b) 7.5; 7.6; 14.2
(c) 7.1(a)
(d) 2.8; 6.11; 7.1(b)(c)
(e) 6.13
316(a)(last sentence) 2.9
(a)(1)(A) 6.11
(a)(1)(B) 6.12
(a)(2) N.A.
(b) 6.12; 6.7
317(a)(1) 6.3
(a)(2) 6.4
(b) 2.4
318(a) 14.1
_________________________
N.A. means Not Applicable
Note: This Cross-Reference Table shall not, for any purpose, be deemend a part
of the Indenture.
<PAGE>
INDENTURE, dated as of October 27, 1997, between FINE HOST
CORPORATION, a Delaware corporation (the "Company"), and THE BANK OF NEW YORK, a
New York banking corporation, as Trustee.
Each party hereto agrees as follows for the benefit of each
other party and for the equal and ratable benefit of the Holders of the
Company's 5% Convertible Subordinated Notes due 2004:
ARTICLE I.
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1. Definitions.
"Acceleration Notice" shall have the meaning specified in
Section 6.2.
"Affiliate" means any person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Company. For purposes of this definition, the terms "control," "controlling" and
"controlled" mean the power to direct the management and policies of a person,
directly or through one or more intermediaries, whether through the ownership of
voting securities, by contract, or otherwise.
"Agent" means the Trustee and any Registrar, Paying Agent,
co-Registrar, authenticating agent or Notes Custodian.
"Bankruptcy Law" means Title 11, U. S. Code, or any similar
federal, state or foreign law for the relief of debtors.
"Beneficial Owner" for purposes of the definition of Change of
Control has the meaning attributed to it in Rules 13d-3 and 13d-5 under the
Exchange Act (as in effect on the Issue Date), whether or not applicable, except
that a "person" shall be deemed to have "beneficial ownership" of all shares
that any such person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time or upon the occurrence of certain
events.
"Board of Directors" means, with respect to any person, the
Board of Directors of such person or any committee of the Board of Directors of
such person authorized, with respect to any particular matter, to exercise the
power of the Board of Directors of such person.
"Board Resolution" means, with respect to any person, a duly
adopted resolution of the Board of Directors, or any duly authorized committee
thereof, of such person.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday
and Friday that is not a day on which banking institutions in New York, New York
are authorized or obligated by law or executive order to close.
"Capitalized Lease Obligation" means, as to any Person, the
obligation of such Person to pay rent or other amounts under a lease to which
such Person is a party that is required to be classified and accounted for as a
capital lease obligation under GAAP.
"Capital Stock" means, with respect to any corporation, any
and all shares, interests, rights to purchase (other than convertible or
exchangeable indebtedness), warrants, options, participations or other
equivalents of or interests (however designated) in stock issued by that
corporation.
"Cash" means such coin or currency of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Change of Control" means (i) an event or series of events as
a result of which any "person" or "group" (as such terms are used in Sections
13(d)(3) and 14(d) of the Exchange Act) (excluding the Company or any wholly
owned Subsidiary thereof or any employee benefit plan of the Company or any such
subsidiary) is or becomes, directly or indirectly, the Beneficial Owner of more
than 50% of the Voting Stock, (ii) the completion of any consolidation or merger
of the Company with or into any other Person, or sale, conveyance, transfer or
lease by the Company of all or substantially all of its assets to any Person, or
any merger of any other Person into the Company in a single transaction or
series of related transactions, and, in the case of any such transaction or
series of related transactions, the outstanding Common Stock of the Company is
changed or exchanged as a result, unless the stockholders of the Company
immediately before such transaction own, directly or indirectly, immediately
following such transaction, at least a majority of the combined voting power of
the outstanding voting securities of the Person resulting from such transaction
in substantially the same proportion as their ownership of the Voting Stock
immediately before such transaction, or (iii) such time as the Continuing
Directors do not constitute a majority of the Board of Directors of the Company
(or, if applicable, a successor corporation to the Company); provided that a
Change of Control shall not be deemed to have occurred if either (x) the last
sale price of the Common Stock for any five Trading Days during the 10 Trading
Days immediately preceding the Change of Control is at least equal to 105% of
the Conversion Price in effect on such day, or (y) with respect to a merger or
consolidation otherwise constituting a Change of Control described in clause
(ii) above, at least 90% of the consideration in such transaction or
transactions consists of common stock or securities convertible into common
stock that are, or upon issuance will be, traded on a United States national
securities exchange or approved for quotation on the Nasdaq National Market.
"Code" means the Internal Revenue Code of 1986, as amended.
"Common Stock" means the Company's common stock, par value
$.01 per share, or as such stock may be reconstituted from time to time.
"Company" means the party named as such in this Indenture
until a successor replaces it pursuant to the Indenture, and thereafter means
such successor.
"Continuing Director" means at any date a member of the
Company's Board of Directors (i) who was a member of such board on the Issue
Date or (ii) who was nominated or elected by at least a majority of the
directors who were Continuing Directors at the time of such nomination or
election or whose election to the Company's Board of Directors was recommended
or endorsed by at least a majority of the directors who were Continuing
Directors at the time of such nomination or election.
"Conversion Price" shall have the meaning specified in Section
13.4.
"Conversion Shares" shall have the meaning specified in
Section 13.5(1).
"Credit Facility" means the Fourth Amended and Restated Loan
Agreement, dated as of July 30, 1997, among the Company, BankBoston, N.A., as
administrative agent, USTrust, as documentation agent, and certain banks and
other financial institutions party thereto, as amended, supplemented or restated
from time to time.
"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"Date of Conversion" shall have the meaning specified in
Section 13.2.
"Default" means any event or condition that is, or after
notice or passage of time or both would be, an Event of Default.
"Defaulted Interest" shall have the meaning specified in
Section 2.12.
"Definitive Notes" means Notes that are in the form of Note
attached hereto as Exhibit A that do not include the information called for by
footnotes 1 and 3 thereof.
"Depositary" means, with respect to the Notes issuable or
issued in whole or in part in global form, the person specified in Section 2.3
as the Depositary with respect to the Notes, until a successor shall have been
appointed and become such pursuant to the applicable provision of this
Indenture, and, thereafter, "Depositary" shall mean or include such successor.
"Disqualified Capital Stock" means, with respect to the
Company, Capital Stock of the Company that, by its terms or by the terms of any
security into which it is convertible, exercisable or exchangeable, is, or upon
the happening of an event or the passage of time would be, required to be
redeemed or repurchased (including at the option of the holder thereof) by the
Company, in whole or in part, on or prior to the Stated Maturity of the Notes,
provided that only the portion of such Capital Stock which is so convertible,
exercisable, exchangeable or redeemable or subject to repurchase prior to such
Stated Maturity shall be deemed to be Disqualified Capital Stock.
"Distribution Date" shall have the meaning specified in
Section 13.5(1).
"DTC" shall have the meaning specified in Section 2.3.
"Event of Default" shall have the meaning specified in Section
6.1.
"Exchange Act" means the Notes Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the SEC thereunder.
"Expiration Time" shall have the meaning specified in Section
13.5(f).
"GAAP" means United States generally accepted accounting
principles set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as approved by a significant segment
of the accounting profession which are in effect in the United States; provided,
however, that for purposes of determining compliance with covenants in the
Indenture, "GAAP" means such generally accepted accounting principles which are
in effect as of the Issue Date.
"Global Note" means a Note that contains the paragraph
referred to in footnote 1 and the additional schedule referred to in footnote 3
to the form of Note attached hereto as Exhibit A. There shall be separate Global
Notes, with separate CUSIP Numbers, to evidence interests (x) in the Notes held
by "qualified institutional buyers," as defined in Rule 144A under the
Securities Act, and (y) in the Notes held by persons who acquired their interest
in the Notes in compliance with Regulation S under the Securities Act.
"Holder" or "Noteholder" means the person in whose name a Note
is registered on the Registrar's books.
"Indebtedness" of any Person means, without duplication, (a)
all liabilities and obligations, contingent or otherwise, of any such Person,
(i) in respect of borrowed money (whether or not the lender has recourse to all
or any portion of the assets of such Person), (ii) evidenced by credit or loan
agreements, bonds, notes, debentures or similar instruments (including, without
limitation, notes or similar instruments given in connection with the
acquisition of any business, properties or assets of any kind), (iii) evidenced
by bankers' acceptances or similar instruments issued or accepted by banks, (iv)
for the payment of money relating to a Capitalized Lease Obligation or (v)
evidenced by a letter of credit or a reimbursement obligation of such Person
with respect to any letter of credit; (b) all obligations of such Person issued
or assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (c) all net obligations of such person under Interest Swap and
Hedging Obligations; (d) all liabilities of others of the kind described in the
preceding clauses (a), (b) or (c) that such Person has guaranteed or that is
otherwise its legal liability, or which is secured by a lien on property of such
Person, and all obligations to purchase, redeem or acquire any Capital Stock;
and (e) any and all deferrals, renewals, extensions, modifications,
replacements, restatements, refinancings and refundings (whether direct or
indirect) of, or any indebtedness or obligation issued in exchange for, any
liability of the kind described in any of the preceding clauses (a), (b), (c) or
(d), or this clause (e), whether or not between or among the same parties.
"Indenture" means this Indenture, as amended or supplemented
from time to time in accordance with the terms hereof.
"Initial Purchasers" means Donaldson, Lufkin & Jenrette
Securities Corporation, NationsBanc Montgomery Securities, Inc., Smith Barney
Inc. and Piper Jaffray Inc.
"Interest Payment Date" means the stated due date of an
installment of interest on the Notes.
"Interest Swap and Hedging Obligation" means the obligations
of any Person under any interest rate or currency protection agreement, future
agreement, option agreement, swap agreement, cap agreement or other interest
rate or currency hedge agreement, collar agreement or other similar agreement or
arrangement to which such Person is a party or beneficiary.
"Issue Date" means the date of first issuance of the Notes
under this Indenture.
"Junior Securities" means any Qualified Capital Stock and any
Indebtedness of the Company that is fully subordinated in right of payment to
the Notes and has no scheduled installment of principal due, by redemption,
sinking fund payment or otherwise, on or prior to the Stated Maturity of the
Notes.
"Last Sale Price" shall have the meaning specified in Section
13.3.
"Legal Holiday" shall have the meaning specified in Section
14.7.
"Lien" means any mortgage, lien, pledge, charge, security
interest or other encumbrance of any kind, whether or not filed, recorded or
otherwise perfected under applicable law (including any conditional sale or
other title retention agreement and any lease deemed to constitute a security
interest and any option or other agreement to give any security interest).
"Liquidated Damages" shall have the meaning specified in the
Registration Rights Agreement.
"non-electing share" shall have the meaning specified in
Section 13.6.
"Non-Payment Default" shall have the meaning specified in
Section 12.2(b).
"Notes" means, collectively, the 5% Convertible Subordinated
Notes due 2004, as amended or supplemented from time to time in accordance with
the terms hereof, issued under this Indenture.
"Notes Custodian" means the Trustee, as custodian with respect
to the Notes in global form, or any successor entity thereto.
"Notice of Default" shall have the meaning specified in
Section 6.1(3), (4) or (5).
"Offer" shall have the meaning specified in Section 13.5(f).
"Officer" means, with respect to the Company, the Chief
Executive Officer, the President, any Vice President, the Chief Financial
Officer, the Treasurer, the Controller, or the Secretary or an Assistant
Secretary of the Company.
"Officers' Certificate" means, with respect to the Company, a
certificate signed by two Officers of the Company and otherwise complying with
the requirements of Section 2.2, if applicable, and Sections 14.4 and 14.5;
provided, however, that for the purposes of Section 4.6(a), "Officers'
Certificate" means a certificate signed by the principal executive officer,
principal financial officer or principal accounting officer of the Company.
"Opinion of Counsel" means a written opinion from legal
counsel who is reasonably acceptable to the Trustee and which complies with the
requirements of Sections 14.4 and 14.5, to the extent applicable thereto.
"Paving Agent" shall have the meaning specified in Section
2.3.
"Payment Blockage Period" shall have the meaning specified in
Section 12.2(b).
"Payment Default" shall have the meaning specified in Section
12.2(a).
"Payment Notice" shall have the meaning specified in Section
12.2(b).
"Person" or "person" means any corporation, individual,
limited liability company, joint stock company, joint venture, partnership,
unincorporated association, governmental regulatory entity, country, state or
political subdivision thereof, trust, municipality or other entity.
"principal" of any Indebtedness means the principal of such
Indebtedness plus, without duplication, any applicable premium, if any, on such
Indebtedness.
"property" means any right or interest in or to property or
assets of any kind whatsoever, whether real, personal or mixed and whether
tangible or intangible.
"Purchase Agreement" means that certain Purchase Agreement,
dated October 21, 1997, by and among the Company and the Initial Purchasers, as
such agreement may be amended, modified or supplemented from time to time in
accordance with the terms thereof.
"Purchased Shares" shall have the meaning specified in Section
13.5(f).
"Qualified Capital Stock" means any Capital Stock of the
Company that is not Disqualified Capital Stock.
"Record Date" means a Record Date specified in the Notes
whether or not such Record Date is a Business Day.
"Redemption Date," when used with respect to any Note to be
redeemed, means the date fixed for such redemption pursuant to Article III of
this Indenture and Paragraph 5 in the form of Note attached hereto as Exhibit A.
"Redemption Price," when used with respect to any Note to be
redeemed, means the redemption price for such redemption pursuant to Paragraph 5
in the form of Note attached hereto as Exhibit A, which shall include, without
duplication, in each case, accrued and unpaid interest and Liquidated Damages,
if any, to and including the Redemption Date.
"Registrar" shall have the meaning specified in Section 2.3.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated the date hereof, by and among the Initial Purchasers and the
Company, as such agreement may be amended, modified or supplemented from time to
time in accordance with the terms thereof.
"Repurchase Date" shall have the meaning specified in Section
11.1(a).
"Repurchase Offer" shall have the meaning specified in Section
11.1(b).
"Repurchase Offer Period" shall have the meaning specified in
Section 11.1(b).
"Repurchase Price" shall have the meaning specified in Section
11.1(a).
"Repurchase Put Date" shall have the meaning specified in
Section 11.1(b).
"Restricted Note" means a Note, unless or until it has been
(i) disposed of in a transaction effectively registered under the Securities Act
or (ii) distributed to the public pursuant to Rule 144 (or any similar provision
then in force) under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations of the SEC promulgated thereunder.
"Senior Indebtedness" means all obligations of the Company to
pay the principal of, premium, if any, interest (including all interest accruing
subsequent to the commencement of any bankruptcy or similar proceeding, whether
or not a claim for post-petition interest is allowable as a claim in any such
proceeding) and rent payable on or in connection with, and all letters of
credit, reimbursement obligations and fees, costs, expenses and other amounts
accrued or due on or in connection with, any Indebtedness of the Company,
whether outstanding on the Issue Date or thereafter created, incurred, assumed,
guaranteed or in effect guaranteed by the Company, unless the instrument
creating or evidencing such Indebtedness provides that such Indebtedness is not
senior or superior in right of payment to the Notes or is pari passu with, or
subordinated to, the Notes; provided that in no event shall Senior Indebtedness
include (a) Indebtedness of the Company owed or owing to any Subsidiary of the
Company, (b) Indebtedness representing or with respect to any account payable or
other accrued current liability or obligation incurred in the ordinary course of
business in connection with the obtaining of materials or services or (c) any
liability for taxes owed or owing by the Company or any Subsidiary of the
Company.
"Shelf Registration Statement" shall have the meaning
specified in the Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary which is a
"significant subsidiary" of the Company within the meaning of Rule 1.02(w) of
Regulation S-X promulgated by the Commission as in effect as of the Issue Date.
"Special Record Date" for payment of any Defaulted Interest
means a date fixed by the Trustee pursuant to Section 2.12.
"Stated Maturity," when used with respect to any Note, means
November 1, 2004.
"Subsidiary" with respect to any Person, means (i) a
corporation a majority of whose Capital Stock with voting power normally
entitled to vote in the election of directors is at the time, directly or
indirectly, owned by such Person, by such Person and one or more Subsidiaries of
such Person or by one or more Subsidiaries of such Person, (ii) a partnership in
which such Person or a Subsidiary of such Person is, at the time, a general
partner and owns alone or together with one or more Subsidiaries of such Person
a majority of the partnership interests, or (iii) any other Person (other than a
corporation) in which such Person, one or more Subsidiaries of such Person or
such Person and one or more Subsidiaries of such Person, directly or indirectly,
at the date of determination thereof, has at least majority ownership interest.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.
Codess.ss.77aaa-77bbbb) as in effect on the date of the execution of this
Indenture.
"Trading Day" means each Monday, Tuesday, Wednesday, Thursday
and Friday, other than any day on which securities are not traded on the Nasdaq
National Market (or, if the Common Stock is not listed thereon, on the principal
national securities exchange on which the Common Stock is listed or admitted to
trading).
"Transfer Restricted Notes" means Notes that bear or are
required to bear the legend set forth in Section 2.6 hereof.
"Trustee" means the party named as such in this Indenture
until a successor replaces it in accordance with the provisions of this
Indenture and thereafter means such successor.
"Trust Officer" means any officer within the corporate trust
division (or any successor group) of the Trustee including without limitation
any vice president, assistant vice president, assistant treasurer, corporate
trust officer or any other officer or employee of the Trustee customarily
performing functions similar to those performed by the Persons who at that time
shall be such officers or employees, and also means, with respect to a
particular corporate trust matter, any other officer of the Trustee to whom such
trust matter is referred because of his knowledge of and familiarity with the
particular subject.
"Voting Stock" means the combined voting power of the then
outstanding securities entitled to vote generally in elections of directors,
managers or trustees, as applicable, of the Company or any successor entity.
Section 1.2. Incorporation by Reference of TIA.
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"Indenture securities" means the Notes.
"Indenture noteholder" means a Holder or a Noteholder.
"Indenture to be qualified" means this Indenture.
"Indenture trustee" or "institutional trustee" means the
Trustee.
"Obligor" on the indenture securities means the Company and
any other obligor on the Notes.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by SEC rule and
not otherwise defined herein have the meanings assigned to them thereby.
Section 1.3. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and
words in the plural include the singular;
(5) provisions apply to successive events and
transactions;
(6) "herein," "hereof" and other words of similar
import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision; and
(7) references to Sections or Articles means
reference to such Section or Article in this Indenture, unless
stated otherwise.
ARTICLE II.
THE NOTES
Section 2.1. Form and Dating.
The Notes and the Trustee's certificate of authentication, in
respect thereof, shall be substantially in the form of Exhibit A hereto, which
Exhibit is part of this Indenture. The Notes may have notations, legends or
endorsements required by law, stock exchange rule or usage. The Company shall
approve the form of the Notes and any notation, legend or endorsement on them.
Any such notations, legends or endorsements not contained in the form of Note
attached as Exhibit A hereto shall be delivered in writing to the Trustee. Each
Note shall be dated the date of its authentication.
The terms and provisions contained in the form of Notes shall
constitute, and are hereby expressly made, a part of this Indenture and, to the
extent applicable, the Company and the Trustee, by their execution and delivery
of this Indenture, expressly agree to such terms and provisions and to be bound
thereby. If any term or provision of a Note limits, qualifies, or conflicts with
the terms of this Indenture, the terms of this Indenture shall control.
Section 2.2. Execution and Authentication.
Two Officers shall sign, or one Officer shall sign and one
Officer shall attest to, the Notes for the Company by manual or facsimile
signature. The Company's seal may be, but is not required to be, impressed,
affixed, imprinted or reproduced on the Notes and may be in facsimile form.
If an Officer whose signature is on a Note was an Officer at
the time of such execution but no longer holds that or any office at the time
the Trustee authenticates the Note, the Note shall be valid nevertheless and the
Company shall nevertheless be bound by the terms of the Notes and this
Indenture.
A Note shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Note but such
signature shall be conclusive evidence that the Note has been authenticated
pursuant to the terms of this Indenture.
The Trustee shall authenticate the Notes for original issue in
the aggregate principal amount of up to $200,000,000 upon a written order of the
Company in the form of an Officers' Certificate. The Officers' Certificate shall
specify (i) the amount of Notes to be authenticated and (ii) the date or dates
on which the Notes are to be authenticated. The aggregate principal amount of
Notes outstanding at any time may not exceed $200,000,000 except as provided in
Section 2.7; provided that Notes in excess of $175,000,000 shall not be issued
other than pursuant to the exercise of the over-allotment option granted by the
Company to the Initial Purchasers as provided in the Purchase Agreement. Upon
the written order or orders of the Company in the form of an Officers'
Certificate, the Trustee shall authenticate Notes in substitution of Notes
originally issued to reflect any name change of the Company.
The Trustee may appoint an authenticating agent acceptable to
the Company to authenticate Notes. Unless otherwise provided in the appointment,
an authenticating agent may authenticate Notes whenever the Trustee may do so.
Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as an
Agent to deal with the Company, any Affiliate of the Company, or any of their
respective Subsidiaries, and has the same protections under the Indenture.
Notes shall be issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof.
Section 2.3. Registrar and Paying Agent.
The Company shall maintain an office or agency in the Borough
of Manhattan, The City of New York, where Notes may be presented for
registration of transfer or for exchange ("Registrar") and an office or agency
where Notes may be presented for payment ("Paying Agent") and where notices and
demands to or upon the Company in respect of the Notes may be served. The
Company may act as Registrar or Paying Agent, except that, for the purposes of
Articles III, VIII and XI and as otherwise specified in the Indenture, neither
the Company nor any Affiliate of the Company shall act as Paying Agent. The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Company may have one or more co-Registrars and one or more additional Paying
Agents. The term "Paying Agent" includes any additional Paying Agent. The
Company hereby initially appoints the Trustee as Registrar and Paying Agent, and
the Trustee hereby initially agrees so to act.
The Company shall enter into an appropriate written agency
agreement with any Agent not a party to this Indenture, which agreement shall
implement the provisions of this Indenture that relate to such Agent. The
Company shall promptly notify the Trustee in writing of the name and address of
any such Agent. If the Company fails to maintain a Registrar or Paying Agent,
the Trustee shall act as such.
The Company initially appoints The Depository Trust Company
("DTC") to act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as Notes
Custodian with respect to the Global Notes.
Section 2.4. Paying Agent to Hold Assets in Trust.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that each Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all assets held by the Paying Agent for the
payment of principal of, premium, if any, interest on or Liquidated Damages with
respect to, the Notes (whether such assets have been distributed to it by the
Company or any other obligor on the Notes), and shall promptly notify the
Trustee in writing of any Default in making any such payment. If either of the
Company or a Subsidiary of the Company acts as Paying Agent, it shall segregate
such assets and hold them as a separate trust fund for the benefit of the
Holders or the Trustee. The Company at any time may require a Paying Agent to
distribute all assets held by it to the Trustee and account for any assets
disbursed and the Trustee may at any time during the continuance of any Payment
Default, upon written request to a Paying Agent, require such Paying Agent to
distribute all assets held by it to the Trustee and to account for any assets
distributed. Upon distribution to the Trustee of all assets that shall have been
delivered by the Company to the Paying Agent, the Paying Agent (if other than
the Company or an Affiliate of the Company) shall have no further liability for
such assets.
Section 2.5. Noteholder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of Holders. If the Trustee is not the Registrar, the Company shall
furnish to the Trustee on or before the third Business Day preceding each
Interest Payment Date and at such other times as the Trustee may request in
writing a list in such form and as of such date as the Trustee reasonably may
require of the names and addresses of Holders.
Section 2.6. Transfer and Exchange.
(a) Transfer and Exchange of Definitive Notes. When Definitive Notes
are presented to the Registrar or a co-Registrar with a request:
(x) to register the transfer of such Definitive
Notes; or
(y) to exchange such Definitive Notes for an equal
principal amount of Definitive Notes of other authorized
denominations;
the Registrar or co-Registrar shall register the transfer or make the exchange
as requested if its reasonable requirements for such transaction are met;
provided, however, that the Definitive Notes surrendered for transfer or
exchange:
(i) shall be duly endorsed or accompanied by a written
instrument of transfer in form reasonably
satisfactory to the Company and the Registrar or
co-Registrar, duly executed by the Holder thereof or
his attorney duly authorized in writing; and
(ii) in the case of a Definitive Note that is a Transfer
Restricted Note, shall be accompanied by the
following additional information and documents, as
applicable:
(A) if such Definitive Note is being delivered to the
Registrar by a Holder for registration in the name of such
Holder, without transfer, a certification from such Holder to
that effect (in substantially the form set forth on the Note);
or
(B) if such Definitive Note is being transferred to a
"qualified institutional buyer" (as defined in Rule 144A under
the Securities Act) in accordance with Rule 144A under the
Securities Act, a certification to that effect (in
substantially the form set forth on the Note); or
(C) if such Definitive Note is being transferred to
an institutional investor that is an "accredited investor"
within the meaning of Rule 501(a)(1), (2), (3) or (7) under
the Securities Act, a certification to that effect (in
substantially the form set forth on the Note) accompanied by a
certificate in the form of Exhibit B to the Indenture to the
Trustee and if either the Trustee or the Company so requests,
an Opinion of Counsel satisfactory to the Company to the
effect that such transfer is in compliance with the Securities
Act;
(D) if such Definitive Note is being transferred in
accordance with Regulation S under the Securities Act, a
certification to that effect (in substantially the form set
forth on the Note) and if either the Trustee or the Company so
requests, an Opinion of Counsel satisfactory to the Company,
the Trustee and the Registrar to the effect that such transfer
is in compliance with the Securities Act; or
(E) if such Definitive Note is being transferred in
reliance on another exemption from the registration
requirements of the Securities Act, a certification to that
effect (in substantially the form set forth on the Note) and
if either the Trustee or the Company so requests, an Opinion
of Counsel satisfactory to the Company to the effect that such
transfer is in compliance with the Securities Act.
(a) Restrictions on Transfer of a Definitive Note for a Beneficial
Interest in a Global Note. A Definitive Note may not be exchanged for a
beneficial interest in a Global Note except upon satisfaction of the
requirements set forth below. Upon receipt by the Trustee of a Definitive Note,
duly endorsed or accompanied by appropriate instruments of transfer in form
reasonably satisfactory to the Company and the Registrar or Co-Registrar, duly
executed by the Holder thereof or his attorney duly authorized in writing,
together with:
(i) if such Definitive Note is a Transfer Restricted Note,
certification, substantially in the form set forth on the Note, that
such Definitive Note is being transferred (x) to a "qualified
institutional buyer" (as defined in Rule 144A under the Securities Act)
in accordance with Rule 144A under the Securities Act or (y) in
accordance with Regulation S under the Securities Act; and
(ii) whether or not such Definitive Note is a Transfer
Restricted Note, written instructions directing the Trustee to make, or
to direct the Notes Custodian to make, an endorsement on the Global
Note to reflect an increase in the aggregate principal amount of the
Notes represented by the applicable Global Note;
then the Trustee shall cancel such Definitive Note and cause, or direct the
Notes Custodian to cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Notes Custodian, the
aggregate principal amount of Notes represented by the appropriate Global Note
to be increased accordingly. If no Global Notes are then outstanding, the
Company shall issue and the Trustee shall authenticate an appropriate new Global
Note in the appropriate principal amount.
(b) Transfer and Exchange of Global Notes. The transfer and exchange of
Global Notes or beneficial interests therein shall be effected through the
Depositary, in accordance with this Indenture (including the restrictions on
transfer set forth herein) and the procedures of the Depositary therefor.
(c) Transfer of a Beneficial Interest in a Global Note for a Definitive
Note.
(i) Upon receipt by the Trustee of written instructions or
such other form of instructions as is customary for the Depositary from
the Depositary or its nominee on behalf of any Person having a
beneficial interest in a Global Note and upon receipt by the Trustee of
a written order or such other form of instructions as is customary for
the Depositary or the Person designated by the Depositary as having
such a beneficial interest in a Transfer Restricted Note only, the
following additional information and documents shall be required to be
delivered to the Trustee (all of which may be submitted by facsimile):
(A) if such beneficial interest is being transferred
to the Person designated by the Depositary as being the
beneficial owner, a certification from such person to that
effect (in substantially the form set forth on the Note); or
(B) if such beneficial interest is being transferred
to a "qualified institutional buyer" (as defined in Rule 144A
under the Securities Act) in accordance with Rule 144A under
the Securities Act, a certification to that effect from the
transferor (in substantially the form set forth on the Note);
or
(C) if such beneficial interest is being transferred
to an institutional investor that is an "accredited investor"
within the meaning of Rule 501(a)(1), (2), (3) or (7) under
the Securities Act, a certification to that effect (in
substantially the form set forth on the Note) accompanied by a
certificate in the form of Exhibit B to the Indenture to the
Trustee and if either the Trustee or the Company so requests,
an Opinion of Counsel satisfactory to the Company to the
effect that such transfer is in compliance with the Securities
Act;
(D) if such beneficial interest is being transferred
in accordance with Regulation S under the Securities Act, a
certification to that effect (in substantially the form set
forth on the Note) and if either the Trustee or the Company so
requests, an Opinion of Counsel satisfactory to the Company,
the Trustee and the Registrar to the effect that such transfer
is in compliance with the Securities Act; or
(E) if such beneficial interest is being transferred
in reliance on another exemption from the registration
requirements of the Securities Act, a certification to that
effect from the transferee or transferor (in substantially the
form set forth on the Note) and if either the Trustee or the
Company so requests, an Opinion of Counsel satisfactory to the
Company to the effect that such transfer is in compliance with
the Securities Act;
then the Trustee or the Notes Custodian, at the direction of the Trustee, will
cause, in accordance with the standing instructions and procedures existing
between the Depositary and the Notes Custodian, the aggregate principal amount
of the applicable Global Note to be reduced and, following such reduction, the
Company will execute and, upon receipt of an authentication order in the form of
an Officers' Certificate, the Trustee will authenticate and make available for
delivery to the transferee a Definitive Note.
(i) Definitive Notes issued in exchange for a beneficial
interest in a Global Note pursuant to this Section 2.6(d) shall be
registered in such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee. The Trustee
shall make such Definitive Notes available for delivery to the persons
in whose names such Notes are so registered.
(d) Restrictions on Transfer and Exchange of Global Notes.
Notwithstanding any other provisions of this Indenture (other than the
provisions set forth in subsection (f) of this Section 2.6), a Global Note may
not be transferred as a whole except (i) by the Depositary to a nominee of the
Depositary, (ii) by a nominee of the Depositary to the Depositary or another
nominee of the Depositary or (iii) by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.
(e) Authentication of Definitive Notes in Absence of Depositary. If at
any time:
(i) the Depositary for the Notes notifies the Company and the
Company notifies the Trustee in writing that the Depositary is no
longer willing or able to continue as Depositary for the Global Notes
and a successor Depositary for the Global Notes is not appointed by the
Company within 90 days after delivery of such notice; or
(ii) the Company, in its sole discretion, notifies the Trustee
in writing that it elects to cause the issuance of Definitive Notes
under this Indenture;
then the Company will execute, and the Trustee, upon receipt of an Officers'
Certificate requesting the authentication and delivery of Definitive Notes,
will authenticate and make available for delivery Definitive Notes, in an
aggregate principal amount equal to the principal amount of the Global Notes,
in exchange for such Global Notes.
(f) Legends.
(i) Except as permitted by the following paragraph (ii), each
Note certificate evidencing the Global Notes and the Definitive Notes
(and all Notes issued in exchange therefor or substitution thereof)
shall bear a legend in substantially the following form:
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
ANY STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR
THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH BELOW. BY
ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER
(1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB"), (B) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT (AN "IAI"), OR (C)
IT IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE
WITH REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT
RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE COMPANY OR
ANY OF ITS SUBSIDIARIES, (B) TO A PERSON WHO THE HOLDER REASONABLY
BELIEVES IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF
A QIB IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A UNDER THE
SECURITIES ACT, (C) TO AN IAI THAT, PRIOR TO SUCH TRANSFER, FURNISHES
THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE TRANSFER OF THIS SECURITY (THE FORM OF WHICH
CAN BE OBTAINED FROM THE TRUSTEE) AND, IF THE COMPANY SO REQUESTS, AN
OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT, (D) IN AN OFFSHORE TRANSACTION
MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE
SECURITIES ACT, (E) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144 UNDER THE SECURITIES ACT, (F) IN ACCORDANCE WITH ANOTHER EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND BASED UPON
AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY, THE TRUSTEE AND THE
REGISTRAR OR (G) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND,
IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (3)
AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR AN
INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND
"UNITED STATES" HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF
REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A
PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF
THIS SECURITY IN VIOLATION OF THE FOREGOING."
(ii) Upon any sale or transfer of a Transfer Restricted Note
(including any Transfer Restricted Note represented by a Global Note)
pursuant to Rule 144 under the Securities Act or an effective
registration statement under the Securities Act:
(A) in the case of any Transfer Restricted Note that
is a Definitive Note or that is represented by a Global Note,
the Registrar shall permit the Holder thereof to exchange such
Transfer Restricted Note for a Definitive Note that does not
bear the legend set forth above and rescind any restriction on
the transfer of such Transfer Restricted Note (1) in the case
of a sale or transfer pursuant to Rule 144 under the
Securities Act, after delivery of a customary Opinion of
Counsel satisfactory to the Company to the effect that such
transfer is in compliance with the Securities Act or (2) in
the case of a sale or transfer pursuant to an effective
registration statement under the Securities Act; and
(B) any such Transfer Restricted Note represented by
a Global Note shall not be subject to the provisions set forth
in (i) above (such sales or transfers being subject only to
the provisions of Section 2.6(c) hereof).
(a) Cancellation and/or Adjustment of Global Note. At such time as all
beneficial interests in a Global Note have either been exchanged for Definitive
Notes, redeemed, repurchased or canceled, such Global Note shall be returned to
or retained and canceled by the Trustee. At any time prior to such cancellation,
if any beneficial interest in a Global Note is exchanged for Definitive Notes,
redeemed, repurchased or canceled, the principal amount of Notes represented by
such Global Note shall be reduced and an endorsement shall be made on such
Global Note, by the Trustee or the Notes Custodian, at the written direction of
the Trustee, to reflect such reduction.
(b) Obligations with respect to Transfers and Exchanges of Definitive
Notes.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Definitive
Notes and Global Notes at the Registrar's or co-Registrar's written
request.
(ii) No service charge shall be made for any registration of
transfer or exchange, but the Company may require payment of a sum
sufficient to cover any transfer tax, assessments, or similar
governmental charge payable in connection therewith (other than any
such transfer taxes, assessments, or similar governmental charge
payable upon exchanges or transfers pursuant to Section 2.2 (fourth
paragraph), 2.10, 3.7, 9.5, or 1 1.1 (final paragraph)).
(iii) The Registrar or co-Registrar shall not be required to
register the transfer of or exchange of (a) any Definitive Note
selected for redemption in whole or in part pursuant to Article III,
except the unredeemed portion of any Definitive Note being redeemed in
part, or (b) any Note for a period beginning 15 days before the mailing
of a notice of an offer to repurchase pursuant to Article XI hereof or
the mailing of a notice of redemption of Notes pursuant to Article III
hereof and ending at the close of business on the day of such mailing.
Section 2.7. Replacement Notes.
If a mutilated Note is surrendered to the Trustee or if the
Holder of a Note claims and submits an affidavit or other evidence, satisfactory
to the Trustee, to the Trustee to the effect that the Note has been lost,
destroyed or stolen, the Company shall issue and the Trustee shall authenticate
a replacement Note if the Trustee's requirements are met. Such Holder must
provide an indemnity bond or other indemnity, sufficient in the judgment of both
the Company and the Trustee, to protect the Company, the Trustee or any Agent
from any loss which any of them may suffer if a Note is replaced. The Company
may charge such Holder for its reasonable, out-of-pocket expenses in replacing a
Note.
In case any such mutilated, destroyed, lost or stolen Note has
become or is about to become due and payable, the Company in its discretion, but
subject to any conversion rights, may, instead of issuing a new Note, pay such
Note, upon satisfaction of the conditions set forth in the preceding paragraph.
Every new Note issued pursuant to this Section 2.7 in lieu of
any mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Company, whether or not the mutilated,
destroyed, lost or stolen Note shall be at any time enforceable by anyone, and
such new Note shall be entitled to all the benefits of this Indenture equally
and proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section 2.7 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies of any Holder with
respect to the replacement or payment of mutilated, destroyed, lost or stolen
Notes.
Section 2.8. Outstanding Notes.
Notes outstanding at any time are all the Notes that have been
authenticated by the Trustee (including any Note represented by a Global Note)
except those canceled by it, those delivered to it for cancellation, those
reductions in the interest in a Global Note effected by the Trustee hereunder,
those paid pursuant to Section 2.7 and those described in this Section 2.8 as
not outstanding. A Note does not cease to be outstanding because the Company or
an Affiliate of the Company holds the Note, except as provided in Section 2.9.
If a Note is replaced pursuant to Section 2.7 (other than a
mutilated Note surrendered for replacement), the replaced Note ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser. A mutilated Note ceases to be
outstanding upon surrender of such Note and replacement thereof pursuant to
Section 2.7.
If on a Redemption Date the Paying Agent (other than the
Company or an Affiliate of the Company) holds Cash sufficient to pay all of the
principal and interest due on the Notes payable on that date in accordance with
Section 3.6 hereof and payment of the Notes called for redemption is not
otherwise prohibited pursuant to Article XII hereof or otherwise, then on and
after that date such Notes cease to be outstanding and interest on them ceases
to accrue.
Section 2.9. Treasury Notes.
In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, amendment, supplement, waiver
or consent, Notes owned by the Company or an Affiliate of the Company shall be
disregarded, except that, for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, amendment, supplement,
waiver or consent, only Notes that a Trust Officer of the Trustee actually knows
are so owned shall be disregarded.
Section 2.10. Temporary Notes.
Until Definitive Notes are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Notes. Temporary Notes
shall be substantially in the form of Definitive Notes but may have variations
that the Company reasonably and in good faith considers appropriate for
temporary Notes. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate Definitive Notes in exchange for temporary Notes.
Until so exchanged, the temporary Notes shall in all respects be entitled to the
same benefits under this Indenture as permanent Notes authenticated and
delivered hereunder.
Section 2.11. Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Notes surrendered to them for transfer, exchange or payment. The Trustee, or
at the direction of the Trustee, the Registrar or the Paying Agent (other than
the Company or an Affiliate of the Company), and no one else, shall cancel and
return all Notes surrendered for transfer, exchange, payment or cancellation to
the Company. Subject to Section 2.7, the Company may not issue new Notes to
replace Notes that have been paid or delivered to the Trustee for cancellation.
No Notes shall be authenticated in lieu of or in exchange for any Notes canceled
as provided in this Section 2.11, except as expressly permitted in the form of
Notes and as permitted by this Indenture.
Section 2.12. Defaulted Interest.
Interest on any Note which is payable, and is punctually paid
or duly provided for, on any Interest Payment Date shall be paid to the person
in whose name that Note (or one or more predecessor Notes) is registered at the
close of business on the Record Date for such interest.
Any interest on any Note which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date plus, to the
extent lawful, any interest payable on the defaulted interest (collectively,
herein called "Defaulted Interest") shall forthwith cease to be payable to the
registered holder on the relevant Record Date, and such Defaulted Interest may
be paid by the Company, at its election in each case, as provided in clause (1)
or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the persons in whose names the Notes (or their respective
predecessor Notes) are registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest, which shall be
fixed in the following manner. The Company shall notify the Trustee in
writing of the amount of Defaulted Interest proposed to be paid on each
Note and the date of the proposed payment, and at the same time the
Company shall deposit with the Trustee an amount of Cash equal to the
aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for
such deposit prior to the date of the proposed payment, such Cash when
deposited to be held in trust for the benefit of the persons entitled
to such Defaulted Interest as provided in this clause (1). Thereupon
the Trustee shall fix a special record date for the payment of such
Defaulted Interest which shall be not more than 15 Business Days and
not less than 10 Business Days prior to the date of the proposed
payment and not less than 10 Business Days after the receipt by the
Trustee of the notice of the proposed payment ("Special Record Date").
The Trustee shall promptly notify the Company in writing of such
Special Record Date and, in the name and at the expense of the Company,
shall cause notice of the proposed payment of such Defaulted Interest
and the Special Record Date therefor to be mailed, first-class postage
prepaid, to each Holder at his address as it appears in the Note
register not less than 10 Business Days prior to such Special Record
Date. Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been mailed as aforesaid, such
Defaulted Interest shall be paid to the persons in whose names the
Notes (or their respective predecessor Notes) are registered on such
Special Record Date and shall no longer be payable pursuant to the
following clause (2).
(2) The Company may make payment of any Defaulted Interest in
any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Notes may be listed, and upon such
notice as may be required by such exchange, if, after written notice
given by the Company to the Trustee of the proposed payment pursuant to
this clause, such manner shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section 2.12, each
Note delivered under this Indenture upon transfer of or in exchange for or in
lieu of any other Note shall carry the rights to interest accrued and unpaid,
and to accrue, which were carried by such other Note.
Section 2.13. CUSIP Numbers.
The Company in issuing the Notes may use "CUSIP" numbers (if
then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notices of redemption as a convenience to the Holders; provided that any such
notice may state that no representation is made as to the correctness of such
numbers either as printed on the Notes or as contained in any notice of
redemption and that reliance may be placed only on the other identification
numbers printed on the Notes, and any such redemption shall not be affected by
any defect in or omission of such numbers. The Company will promptly notify the
Trustee of any change in the "CUSIP" numbers.
ARTICLE III.
REDEMPTION
Section 3.1. Right of Redemption.
Redemption of Notes, as permitted by any provision of this
Indenture, shall be made in accordance with Paragraph 5 of the Notes and this
Article III. The Company will not have the right to redeem any Notes prior to
November 1, 2000. On or after November 1, 2000, the Company will have the right
to redeem all or any part of the Notes at the Redemption Prices specified in
Paragraph 5 therein, in each case including accrued and unpaid interest and
Liquidated Damages, if any, to, but excluding, the Redemption Date. Payments in
respect of the Notes on redemption by the Company are subject to the
subordination provisions set forth in Article XII.
Section 3.2. Notices to Trustee.
If the Company elects to redeem Notes pursuant to Paragraph 5
of the Notes, it shall notify the Trustee in writing of the Redemption Date, the
principal amount of Notes to be redeemed, the Redemption Price and whether it
wants the Trustee to give notice of redemption to the Holders.
The Company shall give each notice to the Trustee provided for
in this Section 3.2 at least 45 days but not more than 60 days before the
Redemption Date (unless a shorter notice period shall be satisfactory to the
Trustee). Any such notice may be canceled at any time prior to notice of such
redemption being mailed to any Holder and shall thereby be void and of no
effect.
Section 3.3. Selection of Notes to Be Redeemed.
If less than all of the Notes are to be redeemed pursuant to
Paragraph 5 thereof, the Trustee shall select the Notes to be redeemed on a pro
rata basis, by lot or by such other method as the Trustee shall determine to be
fair and appropriate and in such manner as complies with any applicable
depositary, legal and stock exchange or automated quotation system requirements.
The Trustee shall make the selection from the Notes
outstanding and not previously called for redemption and shall promptly notify
the Company in writing of the Notes selected for redemption and, in the case of
any Note selected for partial redemption, the principal amount thereof to be
redeemed. Notes in denominations of $1,000 may be redeemed only in whole. The
Trustee may select for redemption portions (equal to $1,000 or any integral
multiple thereof) of the principal of Notes that have denominations larger than
$1,000. Provisions of this Indenture that apply to Notes called for redemption
also apply to portions of Notes called for redemption.
Section 3.4. Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption
Date, the Company shall mail a notice of redemption by first-class mail, postage
prepaid, to the Trustee and each Holder whose Notes are to be redeemed at such
Holder's address as it appears on the security register maintained by the
Registrar. At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense. Each notice of
redemption shall identify the Notes to be redeemed and shall state:
(1) the Redemption Date, and that the Notes called
for redemption may not be converted after the Business Day
immediately prior to the Redemption Date;
(2) the Redemption Price, including the amount of
accrued and unpaid interest and Liquidated Damages, if any, to
be paid upon such redemption;
(3) the name, address and telephone number of the
Paying Agent;
(4) that Notes called for redemption must be
surrendered to the Paying Agent at the address specified in
such notice to collect the Redemption Price;
(5) that, unless (a) the Company defaults in its
obligation to deposit Cash with the Paying Agent in accordance
with Section 3.6 hereof or (b) such redemption payment is
prohibited pursuant to Article XII hereof or otherwise,
interest on, and Liquidated Damages with respect to, Notes
called for redemption ceases to accrue on and after the
Redemption Date and the only remaining right of the Holders of
such Notes is to receive payment of the Redemption Price,
including accrued and unpaid interest and Liquidated Damages,
if any, to, but excluding the Redemption Date, upon surrender
to the Paying Agent of the Notes called for redemption and to
be redeemed;
(6) if any Note is being redeemed in part, the
portion of the principal amount, equal to $1,000 or any
integral multiple thereof, of such Note to be redeemed and
that, on or after the Redemption Date, upon surrender of such
Note, a new Note or Notes in aggregate principal amount equal
to the unredeemed portion thereof will be issued;
(7) if less than all the Notes are to be redeemed,
the identification of the particular Notes (or portion
thereof) to be redeemed, as well as the aggregate principal
amount of such Notes to be redeemed;
(8) the CUSIP number of the Notes to be redeemed; and
(9) that the notice is being sent pursuant to this
Section 3.4 and pursuant to the redemption provisions of
Paragraph 5 of the Notes.
Section 3.5. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section
3.4, Notes called for redemption become due and payable on the Redemption Date
and at the Redemption Price, including accrued and unpaid interest and
Liquidated Damages, if any, to the Redemption Date. Upon surrender to the
Trustee or Paying Agent, such Notes called for redemption shall be paid at the
Redemption Price, including accrued and unpaid interest and Liquidated Damages,
if any, to the Redemption Date; provided that if the Redemption Date is after a
regular Record Date and on or prior to the corresponding Interest Payment Date,
the accrued interest and Liquidated Damages, if any, shall be payable to the
Holder of the redeemed Notes registered on the relevant Record Date; and
provided, further, that if a Redemption Date is a Legal Holiday, payment shall
be made on the next succeeding Business Day and no interest or Liquidated
Damages shall accrue for the period from such Redemption Date to such succeeding
Business Day.
Section 3.6. Deposit of Redemption Price.
On or prior to the Redemption Date, the Company shall deposit
with the Paying Agent (other than the Company or an Affiliate of the Company)
Cash sufficient pay the Redemption Price of, including accrued and unpaid
interest on, and Liquidated Damages, if any, with respect to, all Notes to be
redeemed on such Redemption Date (other than Notes or portions thereof called
for redemption on that date that have been delivered by the Company to the
Trustee for cancellation). The Paying Agent shall promptly return to the Company
any Cash so deposited which is not required for that purpose upon the written
request of the Company.
If the Company complies with the preceding paragraph and the
other provisions of this Article III and payment of the Notes called for
redemption is not prohibited under Article XII or otherwise, interest and
Liquidated Damages, if any, on the Notes to be redeemed will cease to accrue on
and after the applicable Redemption Date, whether or not such Notes are
presented for payment. Notwithstanding anything herein to the contrary, if any
Note surrendered for redemption in the manner provided in the Notes shall not be
so paid upon surrender for redemption because of the failure of the Company to
comply with the preceding paragraph, Liquidated Damages shall continue to accrue
and be paid from the Redemption Date if so required pursuant to Section 3 of the
Registration Rights Agreement and interest shall continue to accrue and be paid
from the Redemption Date until such payment is made on the unpaid principal,
and, to the extent lawful, on any interest not paid on such unpaid principal, in
each case at the rate and in the manner provided in Section 4.1 hereof and the
Note.
Section 3.7. Notes Redeemed in Part.
Upon surrender of a Note that is to be redeemed in part, the
Company shall execute and the Trustee shall thereafter authenticate and make
available for delivery to the Holder, without service charge to the Holder, a
new Note or Notes equal in principal amount to the unredeemed portion of the
Note surrendered.
ARTICLE IV.
COVENANTS
Section 4.1. Payment of Notes.
The Company shall pay the principal of, interest on, and
Liquidated Damages with respect to, the Notes on the dates and in the manner
provided in the Notes and the Registration Rights Agreement, as applicable. An
installment of principal of, interest on, or Liquidated Damages with respect to,
the Notes shall be considered paid on the date it is due if the Trustee or
Paying Agent (other than the Company or an Affiliate of the Company) holds for
the benefit of the Holders, on or before 12:00 noon New York City time on that
date, Cash deposited and designated for and sufficient to pay the installment.
The Company shall pay interest on overdue principal and on
overdue installments of interest at the rate specified in the Notes compounded
semi-annually, to the extent lawful.
Section 4.2. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, The
City of New York, an office or agency where Notes may be presented or
surrendered for payment, where Notes may be surrendered for registration of
transfer or exchange and for conversion and where notices and demands to or upon
the Company in respect of the Notes and this Indenture may be served. The
Company shall give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the address of the Trustee set
forth in Section 14.2.
The Company may also from time to time designate one or more
other offices or agencies where the Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York, for such purposes. The Company shall
give prior written notice to the Trustee of any such designation or rescission
and of any change in the location of any such other office or agency. The
Company hereby initially designates the principal corporate trust office in New
York City of the Trustee as such office.
Section 4.3. Corporate Existence.
Subject to Article V, the Company shall do or cause to be done
all things necessary to preserve and keep in full force and effect its corporate
existence and the corporate or other existence of each of its Subsidiaries in
accordance with the respective organizational documents of each of them and the
rights (charter and statutory) and corporate franchises of the Company and each
of its Subsidiaries; provided, however, that the Company shall not be required
to preserve, with respect to itself, any right or franchise, and with respect to
any of its Subsidiaries, any such existence, right or franchise, if (a) the
Company shall, in good faith, reasonably determine that the preservation thereof
is no longer desirable in the conduct of the business of such entity and (b) the
loss thereof is not disadvantageous in any material respect to the Holders.
Section 4.4. Payment of Taxes and Other Claims.
Except with respect to items that are not material to the
Company and its Subsidiaries taken as a whole, the Company shall, and shall
cause each of its Subsidiaries to, pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (i) all taxes, assessments
and governmental charges (including withholding taxes and any penalties,
interest and additions to taxes) levied or imposed upon the Company or any of
its Subsidiaries or any of their respective properties and assets and (ii) all
lawful claims, whether for labor, materials, supplies, services or anything
else, which have become due and payable and which by law have or may become a
Lien upon the property and assets of the Company or any of its Subsidiaries;
provided, however, that neither the Company nor any Subsidiary shall be required
to pay or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim whose amount, applicability or validity is being contested in
good faith by appropriate proceedings and for which disputed amounts adequate
reserves have been established in accordance with GAAP.
Section 4.5. Maintenance of Properties and Insurance.
The Company shall cause all material properties used or useful
to the conduct of its business and the business of each of its Subsidiaries to
be maintained and kept in good condition, repair and working order (reasonable
wear and tear excepted) and shall cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in its
reasonable judgment may be necessary, so that the business carried on in
connection therewith may be properly conducted at all times; provided, however,
that nothing in this Section 4. 5 shall prevent the Company or any Subsidiary
from discontinuing the operation or maintenance of any of such properties, if
such discontinuance is (a) in the judgment of the Company, desirable in the
conduct of the business of such entity and (b) not disadvantageous in any
material respect to the Holders.
The Company shall provide, or cause to be provided, for itself
and each of its Subsidiaries, insurance (including appropriate self-insurance)
against loss or damage of the kinds that, in the reasonable, good faith opinion
of the Company, is adequate and appropriate for the conduct of the business of
the Company and such Subsidiaries in a prudent manner, with (except for
self-insurance) reputable insurers or with the government of the United States
of America or an agency or instrumentality thereof, in such amounts, with such
deductibles, and by such methods as shall be customary, in the reasonable, good
faith opinion of the Company, and adequate and appropriate for the conduct of
the business of the Company and such Subsidiaries in a prudent manner for
entities similarly situated in the industry, unless failure to provide such
insurance (together with all other such failures) would not have a material
adverse effect on the financial condition or results of operations of the
Company and its Subsidiaries taken as a whole.
Section 4.6. Compliance Certificate; Notice of Default.
(a) The Company shall deliver to the Trustee within 120 days
after the end of the Company's fiscal year an Officers' Certificate complying
with Section 314(a)(4) of the TIA and stating that a review of its activities
and the activities of its Subsidiaries during the preceding fiscal year has been
made under the supervision of the signing Officers with a view to determining
whether the Company has kept, observed, performed and fulfilled its obligations
under this Indenture and further stating, as to each such Officer signing such
certificate, whether or not the signer knows of any failure by the Company or
any Subsidiary of the Company to comply with any conditions or covenants in this
Indenture and, if such signer does know of such a failure to comply, the
certificate shall describe such failure with particularity. The Officers'
Certificate shall also notify the Trustee should the relevant fiscal year end on
any date other than the current fiscal year end date.
(b) The Company shall, so long as any of the Notes are
outstanding, deliver to the Trustee, promptly upon the Company becoming aware of
(and in any event within five days after the Company becomes aware of) any
Default, Event of Default or fact which would prohibit the making of any payment
to or by the Trustee in respect of the Notes, an Officers' Certificate
specifying such Default, Event of Default or fact and what action the Company is
taking or proposes to take with respect thereto. The Trustee shall not be deemed
to have knowledge of any Default, any Event of Default or any such fact unless
one of its Trust Officers receives notice thereof from the Company or any of the
Holders.
Section 4.7. Reports.
Whether or not the Company is subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, the Company shall
deliver to the Trustee, within 15 days after it is or would have been required
to file such with the SEC, annual and quarterly consolidated financial
statements substantially equivalent to financial statements that would have been
included in reports filed with the SEC if the Company were subject to the
requirements of Section 13 or 15(d) of the Exchange Act, including, with respect
to annual information only, a report thereon by the Company's certified
independent public accountants as such would be required in such reports to the
SEC and, in each case, together with a management's discussion and analysis of
financial condition and results of operations which would be so required.
Section 4.8. Limitation on Status as Investment Company.
Neither the Company nor any of its Subsidiaries shall become
an "investment company" (as that term is defined in the Investment Company Act
of 1940, as amended), or otherwise become subject to regulation under the
Investment Company Act.
Section 4.9. Waiver of Stay, Extension or Usury Laws.
The Company covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law or any
usury law or other law which would prohibit or forgive the Company from paying
all or any portion of the principal of, premium of, interest on, or Liquidated
Damages with respect to, the Notes as contemplated herein, wherever enacted, now
or at any time hereafter in force, or which may affect the covenants or the
performance of this Indenture; and (to the extent that it may lawfully do so)
the Company hereby expressly waives all benefit or advantage of any such law,
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
Section 4.10. Rule 144A Information Requirement.
If at any time there are Transfer Restricted Notes outstanding
and the Company shall cease to have a class of equity securities registered
under Section 12(b) of the Exchange Act or shall cease to be subject to Section
15(d) of the Exchange Act, the Company shall furnish, within a reasonable period
of time, to the Holders or beneficial holders of the Notes or the underlying
Common Stock and prospective purchasers of Notes or the underlying Common Stock
designated by the Holders of Transfer Restricted Notes, upon their written
request, the information required to be delivered pursuant to Rule 144A(d)(4)
under the Securities Act until such time as the Shelf Registration Statement has
become effective under the Securities Act. The Company shall also furnish such
information during the pendency of any suspension of effectiveness of the Shelf
Registration Statement.
ARTICLE V.
SUCCESSOR CORPORATION
Section 5.1. Limitation on Merger, Sale or Consolidation.
(a) The Company shall not, directly or indirectly, consolidate
with or merge with or into, or sell, lease, convey or transfer all or
substantially all of its assets (on a consolidated basis), whether in a single
transaction or a series of related transactions or a series of related
transactions, to another Person or group of affiliated Persons (other than to
its wholly owned Subsidiaries), unless (i) either (a) in the case of a merger or
consolidation the Company is the surviving entity or (b) the resulting,
surviving or transferee entity is a corporation organized under the laws of the
United States, any state thereof or the District of Columbia and expressly
assumes by supplemental indenture all of the obligations of the Company in
connection with the Notes and the Indenture; (ii) no Default or Event of Default
shall exist or shall occur immediately before or after giving effect to such
transaction; and (iii) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger or transfer and, if a supplemental indenture is required, such
supplemental indenture comply with the Indenture and that all conditions
precedent hereunder relating to such transactions have been satisfied.
(b) For purposes of clause (a) of this Section 5.1 and Section
13.6, the sale, lease, conveyance, assignment, transfer, or other disposition of
all or substantially all of the properties and assets of one or more
Subsidiaries of the Company, which properties and assets, if held by the Company
instead of such Subsidiaries, would constitute all or substantially all of the
properties and assets of the Company on a consolidated basis, shall be deemed to
be the transfer of all or substantially all of the properties and assets of the
Company.
Section 5.2. Successor Corporation Substituted.
Upon any consolidation or merger or any transfer of all or
substantially all of the assets of the Company in accordance with the foregoing,
the successor corporation formed by such consolidation or into which the Company
is merged or to which such transfer is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under the Indenture
with the same effect as if such successor corporation had been named therein as
the Company, and the Company thereafter will be released from its obligations
under the Indenture and the Notes, except as to any obligations that arise from
or as a result of such transaction.
ARTICLE VI.
EVENTS OF DEFAULT AND REMEDIES
Section 6.1. Events of Default.
"Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be caused voluntarily or involuntarily or effected, without limitation, by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(1) failure to pay any installment of interest on, or
Liquidated Damages with respect to, the Notes as and when the
same becomes due and payable and the continuance of such
failure for a period of 30 days, whether or not such payment
is prohibited by Article XII;
(2) failure to pay all or any part of the principal
of, or premium, if any on the Notes when and as the same
become due and payable at maturity, redemption, by
acceleration or otherwise, including, without limitation,
pursuant to any Repurchase Offer;
(3) the failure of the Company to perform any
conversion of Notes required under the Indenture and the
continuance of any such failure for 30 days;
(4) failure by the Company to observe or perform any
other covenant or agreement contained in the Notes or the
Indenture and, subject to the exception set forth in the last
paragraph of this Section 6.1, the continuance of such failure
for a period of 60 days after written notice is given to the
Company by the Trustee or to the Company and the Trustee by
Holders of at least 25% in aggregate principal amount of the
Notes outstanding;
(5) failure of the Company or any Significant
Subsidiary to make any payment at maturity, including any
applicable grace period, in respect of Indebtedness (other
than non-recourse obligations), in an amount in excess of
$15,000,000 and the continuance of such failure for 30 days
after written notice is given to the Company by the Trustee or
to the Company and the Trustee by the Holders of at least 25%
in aggregate principal amount of Notes outstanding;
(6) default by the Company or any Significant
Subsidiary with respect to any Indebtedness (other than
non-recourse obligations), which default results in the
acceleration of Indebtedness having a principal amount in
excess of $15,000,000 without such Indebtedness having been
discharged or such acceleration having been rescinded or
annulled for 30 days after written notice is given to the
Company by the Trustee or to the Company and the Trustee by
the Holders of at least 25% in aggregate principal amount of
Notes outstanding;
(7) final unsatisfied judgments not covered by
insurance aggregating in excess of $20,000,000, at any one
time rendered against the Company or any of its Significant
Subsidiaries and not stayed, bonded or discharged within 60
days;
(8) a decree, judgment, or order by a court of
competent jurisdiction shall have been entered adjudging the
Company or any of its Significant Subsidiaries as bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization of the Company or any of its Significant
Subsidiaries under any bankruptcy or similar law, and such
decree, judgment or order shall have continued undischarged
and unstayed for a period of 60 days; or a decree, judgment or
order of a court of competent jurisdiction for the appointment
of a receiver, liquidator, trustee, or assignee in bankruptcy
or insolvency of the Company, any of its Significant
Subsidiaries, or of the property of any such Person, or for
the winding up or liquidation of the affairs of any such
Person, shall have been entered, and such decree, judgment, or
order shall have remained in force undischarged and unstayed
for a period of 60 days; or
(9) the Company or any of its Significant
Subsidiaries shall institute proceedings to be adjudicated a
voluntary bankrupt, or shall consent to the filing of a
bankruptcy proceeding against it, or shall file a petition or
answer or consent seeking reorganization under any bankruptcy
or similar law or similar statute, or shall consent to the
filing of any such petition, or shall consent to the
appointment of a Custodian, receiver, liquidator, trustee, or
assignee in bankruptcy or insolvency of it or any of its
assets or property, or shall make a general assignment for the
benefit of creditors, or shall admit in writing its inability
to pay its debts generally as they become due, or shall,
within the meaning of any Bankruptcy Law, become insolvent,
fail generally to pay its debts as they become due, or take
any corporate action in furtherance of or to facilitate,
conditionally or otherwise, any of the foregoing.
Notwithstanding the 60-day period and notice requirement
contained in Section 6.1(4) above, with respect to a default in any obligation
of the Company under Article XI the 60-day period referred to in Section 6.1(4)
shall be deemed to have begun as of the date the Change of Control notice is
required to be sent in the event that the Company has not complied with the
provisions of Section 11.1 and the Trustee or Holders of at least 25% in
principal amount of the outstanding Notes thereafter give the Notice of Default
referred to in Section 6.1(4) to the Company and, if applicable, the Trustee;
provided, however, that if the breach or default is a result of a default in the
payment when due of the Repurchase Price on the Repurchase Date, such Event of
Default shall be deemed, for purposes of this Section 6.1, to arise no later
than on the final Repurchase Date.
Section 6.2. Acceleration of Maturity, Rescission and Annulment.
If an Event of Default (other than an Event of Default
specified in Section 6.1(8) or (9) relating to the Company) occurs and is
continuing, then in every such case, unless the principal of all of the Notes
shall have already become due and payable, either the Trustee or the Holders of
not less than 25% in aggregate principal amount of then outstanding Notes, by a
notice in writing to the Company (and to the Trustee if given by Holders) (an
"Acceleration Notice"), may declare all of the principal of the Notes (or the
Repurchase Price if the Event of Default includes failure to pay the Repurchase
Price, determined as set forth below), including in each case premium, if any,
accrued interest and Liquidated Damages on or with respect thereto, to be due
and payable immediately. If an Event of Default specified in Section 6.1(8) or
(9) relating to the Company occurs, all principal, premium, if any, accrued
interest and Liquidated Damages on or with respect thereto will be immediately
due and payable on all outstanding Notes without any declaration or other act on
the part of Trustee or the Holders.
At any time after such a declaration of acceleration has been
made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter provided in this Article VI, and subject
to Section 12.2(b), the Holders of no less than a majority in aggregate
principal amount of then outstanding Notes, by written notice to the Company and
the Trustee, may rescind, on behalf of all Holders, any such declaration of
acceleration if:
(1) the Company has paid or deposited with the Trustee Cash
sufficient to pay:
(A) all overdue interest on, and overdue Liquidated
Damages with respect to, all Notes,
(B) the principal of (and premium, if any, applicable
to) any Notes which would then be due otherwise than by such
declaration of acceleration, and interest thereon at the rate
borne by the Notes,
(C) to the extent that payment of such interest is
lawful, interest upon overdue interest and Liquidated Damages
at the rate borne by the Notes,
(D) all sums paid or advanced by the Trustee
hereunder and the compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and
(2) all Events of Default, other than the non-payment of the
principal of, premium, if any, interest on and Liquidated Damages with
respect to Notes that have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 6.12,
including, if applicable, any Event of Default relating to the
covenants contained in Section 11.1.
Notwithstanding the previous sentence of this Section 6.2, no waiver shall be
effective against any Holder for any Event of Default or event which with notice
or lapse of time or both would be an Event of Default with respect to any
covenant or provision which cannot be modified or amended without the consent of
the Holder of each outstanding Note affected thereby, unless all such affected
Holders agree, in writing, to waive such Event of Default or other event. No
such waiver shall cure or waive any subsequent Default or Event of Default or
impair any right consequent thereon.
Section 6.3. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if an Event of Default in payment
of principal, premium, interest or Liquidated Damages specified in clause (1) or
(2) of Section 6.1 occurs and is continuing, the Company shall, upon demand of
the Trustee, pay to it, for the benefit of the Holders of such Notes, the whole
amount then due and payable on such Notes for principal, premium (if any),
interest, Liquidated Damages and, to the extent that payment of such interest
shall be legally enforceable, interest on any overdue principal (and premium, if
any), Liquidated Damages and on any overdue interest, at the rate borne by the
Notes, and, in addition thereto, such further amount as shall be sufficient to
cover the costs, fees and expenses of collection, including compensation to, and
expenses, disbursements and advances of, the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust in favor
of the Holders, may at the expense of the Company institute a judicial
proceeding for the collection of the sums so due and unpaid, may at the expense
of the Company prosecute such proceeding to judgment or final decree and may
enforce the same against the Company or any other obligor upon the Notes and
collect the moneys adjudged or decreed to be payable in the manner provided by
law out of the property of the Company or any other obligor upon the Notes,
wherever situated.
If an Event of Default occurs and is continuing, the Trustee
may in its discretion proceed to protect and enforce its rights and the rights
of the Holders by such appropriate judicial proceedings as the Trustee shall
deem most effective to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid of
the exercise of any power granted herein, or to enforce any other proper remedy.
Section 6.4. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor upon the
Notes or the property of the Company or of such other obligor or their
creditors, the Trustee (which term as used in this Section shall include any
predecessor Trustee) (irrespective of whether the principal of the Notes shall
then be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand on the Company
for the payment of overdue principal, interest or Liquidated Damages) shall be
entitled and empowered, by intervention in such proceeding or otherwise, to take
any and all actions under the TIA, including
(1) to file and prove a claim for the whole amount of
principal (and premium, if any), interest and Liquidated Damages owing
and unpaid in respect of the Notes and to file such other papers or
documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim under Section 7.7 for the
compensation, fees, expenses, disbursements and advances of the
Trustee, its agents and counsel) and of the Holders allowed in such
judicial proceeding, and
(2) To collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same in
accordance with Section 6.6;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amount due it for the compensation, expenses, fees,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.7. To the extent that the payment of
such compensation, expenses, fees, disbursements and advances of Trustee, its
agents and counsel and any other amounts due to the Trustee under Section 7.7
hereof out of the estate in any such judicial proceeding shall be denied for any
reason, payment of the same shall be secured by a perfected first priority
security interest in and lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties that the
Holders may be entitled to receive in such proceeding whether in liquidation or
under any plan of reorganization or arrangement or otherwise, and any such
security interest and lien in favor of any predecessor Trustee shall be senior
to the security interest and lien in favor of the current Trustee.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment, or composition affecting
the Notes or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
Section 6.5. Trustee May Enforce Claims Without Possession of Notes.
All rights of action and claims under this Indenture or the
Notes may be prosecuted and enforced by the Trustee without the possession of
any of the Notes or the production thereof in any proceeding relating thereto,
and any such proceeding instituted by the Trustee shall be brought in its own
name as trustee of an express trust in favor of the Holders, and any recovery of
judgment shall, after provision for the payment of compensation to, and
expenses, fees, disbursements and advances of, the Trustee, its agents and
counsel, be for the ratable benefit of the Holders of the Notes in respect of
which such judgment has been recovered.
Section 6.6. Priorities.
Any money collected by the Trustee pursuant to this Article VI
shall be applied in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money on account of principal,
premium (if any), interest or Liquidated Damages, upon presentation of the Notes
and the notation thereon of the payment if only partially paid and upon
surrender thereof if fully paid:
FIRST: To the Trustee (including any predecessor Trustee) in
payment of all amounts due pursuant to Section 7.7;
SECOND: To the holders of Senior Indebtedness of the Company
to the extent provided in Article XII;
THIRD: To the Holders in payment of the amounts then due and
unpaid for principal of, premium (if any), interest on and Liquidated
Damages with respect to, the Notes in respect or for the benefit of
which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such
Notes for principal, premium (if any), interest and Liquidated Damages,
respectively; and
FOURTH: To the Company or whomsoever may be lawfully entitled
thereto, the remainder, if any.
Section 6.7. Limitation on Suits.
No Holder of any Note shall have any right to order or direct
the Trustee to institute any proceeding, judicial or otherwise, with respect to
this Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless:
(A) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(B) the Holders of not less than 25% in principal amount of
then outstanding Notes shall have made written request to the Trustee
to institute proceedings in respect of such Event of Default in its own
name as Trustee hereunder;
(C) such Holder or Holders have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities to be incurred or reasonably probable to be incurred in
compliance with such request;
(D) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(E) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of a
majority in principal amount of then outstanding Notes;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
Section 6.8. Unconditional Right of Holders to Receive Principal, Premium,
Interest and Liquidated Damages.
Notwithstanding any other provision of this Indenture, the
Holder of any Note shall have the right, which is absolute and unconditional, to
receive payment of the principal of, and premium (if any), interest on and
Liquidated Damages with respect to, such Note when due (including, in the case
of redemption, the Redemption Price on the applicable Redemption Date, and in
the case of the Repurchase Price, on the applicable Repurchase Date), to convert
such Note in accordance with Article XIII, and to institute suit for the
enforcement of any such payment and right to convert after such respective
dates, and such rights shall not be impaired without the consent of such Holder.
Section 6.9. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Notes in Section 2.7, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 6.10. Delay or Omission Not Waiver.
No delay or omission by the Trustee or by any Holder of any
Note to exercise any right or remedy arising upon any Event of Default shall
impair the exercise of any such right or remedy or constitute a waiver of any
such Event of Default. Every right and remedy given by this Article VI or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
Section 6.11. Control by Holders.
The Holder or Holders of no less than a majority in aggregate
principal amount of then outstanding Notes shall have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred upon the Trustee,
provided, that
(A) such direction shall be made in writing to the Trustee and
shall not be in conflict with any rule of law or with this Indenture,
(B) the Trustee shall not determine that the action so
directed would be unjustly prejudicial to the Holders not taking part
in such written direction, and
(C) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such written direction.
Section 6.12. Waiver of Past Default.
Holder or Holders of not less than a majority in aggregate
principal amount of then outstanding Notes may, on behalf of all Holders, prior
to the declaration of acceleration of the maturity of the Notes, waive any past
default hereunder and its consequences, except a default
(A) in the payment of the principal of, premium, if
any, interest on, or Liquidated Damages with respect to, any
Note not yet cured as specified in clauses (1) and (2) of
Section 6.1, or
(B) in respect of a covenant or provision hereof
which, under Article IX, cannot be modified or amended without
the consent of the Holder of each outstanding Note affected.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair the exercise of any right arising
therefrom.
Section 6.13. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any
Note by his acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of any right or
remedy under this Indenture, or in any suit against the Trustee for any action
taken, suffered or omitted to be taken by it as Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section 6.13 shall not apply to any suit instituted
by the Company, to any suit instituted by the Trustee, to any suit instituted by
any Holder, or group of Holders, holding in the aggregate more than 10% in
aggregate principal amount of then outstanding Notes, or to any suit instituted
by any Holder for enforcement of the payment of principal of, premium (if any),
interest on or Liquidated Damages with respect to, any Note on or after the
respective Stated Maturity of such Note (including, in the case of redemption,
on or after the Redemption Date).
Section 6.14. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, then and in every case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
ARTICLE VII.
TRUSTEE
The Trustee hereby accepts the trust imposed upon it by this
Indenture and covenants and agrees to perform the same, as herein expressed.
Section 7.1. Duties of Trustee.
(a) If a Default or an Event of Default has occurred and is continuing,
the Trustee shall exercise such of the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their exercise as a
prudent Person would exercise or use under the circumstances in the conduct of
his own affairs.
(b) Except during the continuance of a Default or an Event of Default:
(1) The Trustee need perform only those duties as are specifically set
forth in this Indenture and no others, and no covenants or obligations
shall be implied in or read into this Indenture which are adverse to the
Trustee.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions whether in
their original or facsimile form furnished to the Trustee and conforming to
the requirements of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they substantially
conform to the requirements of this Indenture. However, in the case of any
such certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, the Trustee shall
examine the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture but not to verify the
contents thereof.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of this
Section 7.1.
(2) The Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a written direction
received by it pursuant to Section 6.11.
(d) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or to take or omit to take any action
under this Indenture or at the request, order or direction of the Holders or in
the exercise of any of its rights or powers if it shall have reasonable grounds
for believing that repayment of such funds or adequate indemnity against such
risk or liability is not assured to it.
(e) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), (c), (d) and (f) of this Section 7.1.
(f) The Trustee shall not be liable for interest on any assets received
by it except as the Trustee may agree in writing with the Company. Assets held
in trust by the Trustee need not be segregated from other assets except to the
extent required by law.
Section 7.2. Rights of Trustee.
Subject to Section 7.1:
(a) The Trustee may conclusively rely on any document whether in its
original or facsimile form believed by it to be genuine and to have been signed
or presented by the proper Person. The Trustee need not investigate any fact or
matter stated in the document, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it may see fit,
and if the Trustee shall determine to make such further inquiry or investigation
it shall be entitled to examine the books, records and premises of the Company,
personally or by agent or attorney.
(b) Before the Trustee acts or refrains from acting, it may consult
with counsel of its selection and may require an Officers' Certificate or an
Opinion of Counsel, which shall conform to Sections 14.4 and 14.5. The Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on such certificate or advice of counsel.
(c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any attorney or agent
appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its discretion,
rights or powers conferred upon it by this Indenture.
(e) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, notice, request, direction, consent, order, bond, debenture, or other
paper or document, but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders, pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby.
(g) Unless otherwise specifically provided for in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.
(h) The Trustee shall have no duty to inquire as to the performance of
the Company's covenants in Article IV hereof. In addition, the Trustee shall not
be deemed to have knowledge of any Default or Event of Default except (i) any
Event of Default occurring pursuant to Sections 6.1(1), 6.1(2) or 5. 1, or (ii)
any Default or Event of Default of which the Trustee shall have received written
notification or obtained actual knowledge.
(i) No permissive right of the Trustee to act hereunder shall be
construed as a duty.
(j) If in the administration of this Indenture the Trustee deems it
desirable that a matter be proved or established prior to taking, suffering or
omitting to take any action hereunder, the Trustee (unless other evidence be
herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate, an Opinion of Counsel, or both.
(k) The Trustee shall not be deemed to have notice or knowledge
(including actual knowledge) of any matter unless a Trust Officer has actual
knowledge thereof or unless written notice thereof is received by the Trustee at
the office specified in Section 14.2 and such notice references the Notes
generally, the Company or this Indenture.
Section 7.3. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the Company, any of
its Subsidiaries, or their respective Affiliates with the same rights it would
have if it were not Trustee. Any Agent may do the same with like rights.
However, the Trustee must comply with Sections 7.10 and 7.11.
Section 7.4. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or
adequacy of this Indenture, the Registration Rights Agreement, the Offering
Memorandum or the Notes and it shall not be accountable for the Company's use of
the proceeds from the Notes, and it shall not be responsible for any statement
in the Notes, other than the Trustee's certificate of authentication, or the use
or application of any funds received by a Paying Agent other than the Trustee.
Section 7.5. Notice of Default.
If a Default or an Event of Default occurs and is continuing
and if it is actually known to the Trustee, the Trustee shall mail to each
Noteholder notice of the uncured Default or Event of Default within 90 days
after the later to occur of (i) the occurrence of such Default or Event of
Default or (ii) the date the Trustee becomes aware of such Default or Event of
Default. Except in the case of a Default or an Event of Default in payment of
principal (or premium, if any) of, interest on or Liquidated Damages with
respect to, any Note (including the payment of the Repurchase Price on the
Repurchase Date and the payment of the Redemption Price on the Redemption Date),
the Trustee may withhold the notice if and so long as a committee of Trust
Officers in good faith determines that withholding the notice is in the interest
of the Noteholders.
Section 7.6. Reports by Trustee to Holders.
Within 90 days after each April 15 beginning with the April 15
following the date of this Indenture, the Trustee shall, if required by law,
mail to each Noteholder a brief report dated as of such April 15 that complies
with TIA ss. 313(a). The Trustee also shall comply with TIA ss.ss. 313(b) and
313(c).
The Company shall promptly notify the Trustee in writing if
the Notes become listed on any stock exchange or automatic quotation system or
become delisted therefrom.
A copy of each report at the time of its mailing to
Noteholders shall be mailed to the Company and, if required, filed with the SEC
and each stock exchange, if any, on which the Notes are listed.
Section 7.7. Compensation and Indemnity.
The Company agrees to pay to the Trustee from time to time
such compensation for its services as the parties shall agree in writing from
time to time and, in the absence of such agreement, reasonable compensation for
its acceptance of this Indenture and services hereunder. The Trustee's
compensation shall not be limited by any law on compensation of a trustee of an
express trust. The Company shall reimburse the Trustee upon request for all such
disbursements, expenses, fees and advances incurred or made by it. Such expenses
shall include the reasonable compensation, disbursements, fees and expenses of
the Trustee's agents, accountants, experts and counsel.
The Company agrees to indemnify each of the Trustee and any
predecessor Trustee (in its capacity as Trustee) and each of its officers,
directors, attorneys-in-fact and agents for, and hold them harmless against, any
and all claims, demands, expenses (including but not limited to reasonable
compensation, fees, disbursements and expenses of the Trustee's agents and
counsel and taxes (other than taxes based on the income of the Trustee)), loss,
damages or liability incurred by it without negligence, bad faith or willful
misconduct on its part, arising out of, related to, or in connection with the
acceptance or administration of this trust and its rights or duties hereunder
including the reasonable costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder. The Trustee shall notify the Company promptly of any
claim asserted against the Trustee for which it may seek indemnity. The Company
shall defend the claim and the Trustee shall provide reasonable cooperation at
the Company's expense in the defense. The Trustee may have separate counsel of
its selection and the Company shall pay the reasonable fees and expenses of such
counsel; provided, that the Company will not be required to pay such fees and
expenses if it assumes the Trustee's defense and there is no conflict of
interest between the Company and the Trustee in connection with such defense.
The Company need not pay for any settlement made without its written consent.
The Company need not reimburse any expense or indemnify against any loss or
liability to the extent incurred by the Trustee through its negligence, bad
faith or willful misconduct.
To secure the Company's payment obligations in this Section
7.7, the Trustee and each predecessor Trustee shall have a perfected lien prior
to the Notes on all assets held or collected by the Trustee, in its capacity as
Trustee, except assets held in trust for the benefit of the Holders to pay
principal and premium, if any, of or interest or Liquidated Damages on
particular Notes. Any lien in favor of a predecessor Trustee shall be senior to
any lien in favor of the current Trustee.
When the Trustee or any predecessor Trustee incurs expenses or
fees or renders services after an Event of Default specified in Section 6.1(8)
or (9) occurs, the expenses and the compensation for the services are intended
to constitute expenses of administration under any Bankruptcy Law.
The Company's obligations under this Section 7.7 and any lien
arising hereunder shall survive indefinitely, including upon the resignation or
removal of the Trustee, the discharge of the Company's obligations pursuant to
Article VIII of this Indenture and any rejection or termination of this
Indenture under any Bankruptcy Law.
Section 7.8. Replacement of Trustee.
The Trustee may resign by so notifying the Company in writing.
The Holder or Holders of a majority in principal amount of then outstanding
Notes may remove the Trustee by so notifying the Company and the Trustee in
writing. The Company, by Board Resolution, may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged bankrupt or insolvent;
(c) a receiver, Custodian, or other public officer
takes charge of the Trustee or its property; or
(d) the Trustee becomes incapable of acting.
No resignation or removal of the Trustee and no appointment of
a successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of this Section 7.8.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office, the
Holder or Holders of a majority in principal amount of then outstanding Notes
may, with the Company's consent, appoint a successor Trustee to replace the
successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately upon
delivery of such notice and provided that all sums owing to the retiring Trustee
provided for in Section 7.7 have been paid, the retiring Trustee shall transfer
all property held by it as trustee to the successor Trustee, subject to the lien
provided in Section 7.7, the resignation or removal of the retiring Trustee
shall become effective, and the successor Trustee shall have all the rights,
powers and duties of the Trustee under this Indenture. A successor Trustee shall
mail notice of its succession to each Holder.
If a successor Trustee does not take office within 30 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company or the Holder or Holders of at least 10% in principal amount of then
outstanding Notes may at the expense of the Company petition any court of
competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any bona
fide Holder may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this
Section 7.8, the Company's obligations under Section 7.7 shall continue
indefinitely for the benefit of the retiring Trustee.
Section 7.9. Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
The Trustee shall at all times satisfy the requirements of TIA
ss. 310(a)(1), (2) and (5). The Trustee and its direct parent or, in the case of
a corporation included in a bank holding company system, the related bank
holding company, shall have a combined capital and surplus of at least
$100,000,000 as set forth in its most recent published annual report of
condition. The Trustee shall comply with TIA ss. 310(b).
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA ss. 311(a), excluding any
creditor relationship listed in TIA ss. 311(b). A Trustee who has resigned or
been removed shall be subject to TIA ss. 311(a) to the extent indicated.
Section 7.12. Other Capacities.
All references in this Indenture to the Trustee shall be
deemed to refer to the Trustee in its capacity as Trustee and in its capacities
as any Agent, to the extent acting in such capacities, and every provision of
this Indenture relating to the conduct or affecting the liability or offering
protection, immunity or indemnity to the Trustee shall be deemed to apply with
the same force and effect to the Trustee acting in its capacity as any Agent.
ARTICLE VIII.
SATISFACTION AND DISCHARGE
Section 8.1. Satisfaction and Discharge of Indenture.
The Company may terminate its obligations under this Indenture
(subject to the provisions of this Article VIII and Section 7.7) when it shall
have delivered to the Trustee for cancellation all Notes theretofore
authenticated (other than any Notes which shall have been cancelled, lost or
stolen and which shall have been replaced or paid as provided in Article II
hereof) and the following conditions shall be satisfied:
(1) The Company has paid all sums payable under the Indenture;
and
(2) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent have been complied with as contemplated by this Section 8.
1.
Section 8.2. Repayment to the Company.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, for the payment of the principal of, premium, if any,
interest on or Liquidated Damages with respect to any Note and remaining
unclaimed for two years after such principal, premium, if any, interest or
Liquidated Damages has become due and payable shall, subject to applicable law,
be paid to the Company on its written request; and the Holder of such Note shall
thereafter look only to the Company for payment thereof, and all liability of
the Trustee or such Paying Agent with respect to such trust money shall
thereupon cease.
ARTICLE IX.
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 9.1. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holder, the Company, when
authorized by Board Resolutions, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Trustee, for any of the following purposes:
(1) to cure any ambiguity, defect, or inconsistency,
or to make any other provisions with respect to matters or
questions arising under this Indenture which shall not be
inconsistent with the provisions of this Indenture, provided,
that such action pursuant to this clause (1) does not
adversely affect the interests of any Holder in any respect;
(2) to create additional covenants of the Company for
the benefit of the Holders, or to surrender any right or power
herein conferred upon the Company or to make any other change
that does not adversely affect the rights of any Holder,
provided, that the Company has delivered to the Trustee an
Opinion of Counsel stating that such change pursuant to this
clause (2) does not adversely affect the rights of any Holder;
(3) to provide for collateral for or guarantors of
the Notes;
(4) to evidence the succession of another Person to
the Company and the assumption by any such successor of the
obligations of the Company herein and in the Notes in
accordance with Article V; or
(5) to comply with the TIA.
Section 9.2. Amendments, Supplemental Indentures and Waivers with Consent of
Holders.
Subject to the last sentence of this paragraph, with the
consent of the Holders of not less than a majority in aggregate principal amount
of then outstanding Notes, by written act of said Holders delivered to the
Company and the Trustee, the Company, when authorized by Board Resolutions, and
the Trustee may amend or supplement this Indenture or the Notes or enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or the Notes or of modifying in any manner the rights of the
Holders under this Indenture or the Notes. Subject to the last sentence of this
paragraph, the Holder or Holders of not less than a majority in aggregate
principal amount of then outstanding Notes may, in writing, waive compliance by
the Company with any provision of this Indenture or the Notes. Notwithstanding
any of the above, however, no such amendment, supplemental indenture or waiver
shall, without the consent of the Holder of each outstanding Note affected
thereby:
(1) change the Stated Maturity of any Note or reduce
the principal amount thereof or the rate (or extend the time
for payment) of interest thereon or any premium payable upon
the redemption thereof, or change the place of payment where,
or the coin or currency in which, any Note or any premium or
the interest thereon is payable, or impair the right to
institute suit for the conversion of any Note or the
enforcement of any such payment on or after the due date
thereof (including, in the case of redemption, on or after the
Redemption Date), or reduce the Repurchase Price, or alter the
Repurchase Offer (other than set forth herein) or redemption
provisions in a manner adverse to the Holders;
(2) reduce the percentage in principal amount of the
outstanding Notes, the consent of whose Holders is required
for any such amendment, supplemental indenture or waiver
provided for in the Indenture;
(3) adversely affect the right of such Holder to
convert Notes.
It shall not be necessary for the consent of the Holders under
this Section 9.2 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section
9.2 becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental indenture or
waiver.
After an amendment, supplement or waiver under this Section
9.2 or Section 9.4 becomes effective, it shall bind each Holder.
In connection with any amendment, supplement or waiver under
this Article IX, the Company may, but shall not be obligated to, offer to any
Holder who consents to such amendment, supplement or waiver, or (at the option
of the Company) to all Holders, consideration for consent to such amendment,
supplement or waiver.
Section 9.3. Compliance with TIA.
Every amendment, waiver or supplement of this Indenture or the
Notes shall comply with the TIA as then in effect.
Section 9.4. Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a
consent to it by a Holder is a continuing consent by the Holder and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Holder's Note, even if notation of the consent is not made on any
Note. However, any such Holder or subsequent Holder may revoke the consent as to
his Note or portion of his Note by written notice to the Company, the Trustee or
the Person designated by the Company as the Person to whom consents should be
sent if such revocation is received by the Company or such Person before the
date on which the Trustee receives an Officers' Certificate certifying that the
Holders of the requisite principal amount of Notes have consented (and not
theretofore revoked such consent) to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to consent to any
amendment, supplement or waiver, which record date shall be the date so fixed by
the Company notwithstanding the provisions of the TIA. If a record date is
fixed, then notwithstanding the last sentence of the immediately preceding
paragraph, those Persons who were Holders at such record date, and only those
Persons (or their duly designated proxies), shall be entitled to revoke any
consent previously given, whether or not such Persons continue to be Holders
after such record date. No such consent shall be valid or effective for more
than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it
shall bind every Noteholder, unless it makes a change described in any of
clauses (1) through (4) of Section 9.2, in which case, the amendment, supplement
or waiver shall bind only each Holder of a Note who has consented to it and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Holder's Note; provided, that any such waiver shall not
impair or affect the right of any Holder to receive payment of principal and
premium of and interest on and Liquidated Damages with respect to a Note, on or
after the respective dates set for such amounts to become due and payable as
then expressed in such Note, or to bring suit for the enforcement of any such
payment on or after such respective dates.
Section 9.5. Notation on or Exchange of Notes.
If an amendment, supplement or waiver changes the terms of a
Note, the Trustee may require the Holder of the Note to deliver it to the
Trustee or require the Holder to put an appropriate notation on the Note. The
Trustee may place an appropriate notation on the Note about the changed terms
and return it to the Holder. Alternatively, if the Company or the Trustee so
determines, the Company in exchange for the Note shall issue and the Trustee
shall authenticate a new Note that reflects the changed terms. Any failure to
make the appropriate notation or to issue a new Note shall not affect the
validity of such amendment, supplement or waiver.
Section 9.6. Trustee to Sign Amendments, Etc.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article IX; provided, that the Trustee may, but
shall not be obligated to, execute any such amendment, supplement or waiver
which affects the Trustee's own rights, duties or immunities under this
Indenture. The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
any amendment, supplement or waiver authorized pursuant to this Article IX is
authorized or permitted by this Indenture.
ARTICLE X.
MEETINGS OF NOTEHOLDERS
Section 10.1. Purposes for Which Meetings May Be Called.
A meeting of Noteholders may be called at any time and from
time to time pursuant to the provisions of this Article X for any of the
following purposes:
(a) to give any notice to the Company or to the Trustee, or to give any
directions to the Trustee, or to waive or to consent to the waiving of any
Default or Event of Default hereunder and its consequences, or to take any other
action authorized to be taken by Noteholders pursuant to any of the provisions
of Article VI;
(b) to remove the Trustee or appoint a successor Trustee pursuant to
the provisions of Article VII;
(c) to consent to an amendment, supplement or waiver pursuant to
provisions of Section 9.2; or
(d) to take any other action (i) authorized to be taken by or on behalf
of the Holder or Holders of any specified aggregate principal amount of the
Notes under any other provision of this Indenture, or authorized or permitted by
law or (ii) which the Trustee deems necessary or appropriate in connection with
the administration of this Indenture.
Section 10.2. Manner of Calling Meetings.
The Trustee may at any time call a meeting of Noteholders to
take any action specified in Section 10.1, to be held at such time and at such
place in the City of New York, New York or elsewhere as the Trustee shall
determine. Notice of every meeting of Noteholders, setting forth the time and
place of such meeting and in general terms the action proposed to be taken at
such meeting, shall be mailed at the Company's expense by the Trustee,
first-class postage prepaid, to the Company and to the Holders at their last
addresses as they shall appear on the registration books of the Registrar, not
less than 10 nor more than 60 days prior to the date fixed for a meeting.
Any meeting of Noteholders shall be valid without notice if
the Holders of all Notes then outstanding are present in Person or by proxy, or
if notice is waived before or after the meeting by the Holders of all Notes
outstanding, and if the Company and the Trustee are either present by duly
authorized representatives or have, before or after the meeting, waived notice.
Section 10.3. Calling of Meetings by the Company or Holders.
In case at any time the Company or the Holders of not less
than 10% in aggregate principal amount of the Notes then outstanding shall have
requested the Trustee to call a meeting of Noteholders to take any action
specified in Section 10.1, by written request setting forth in reasonable detail
the action proposed to be taken at the meeting, and the Trustee shall not have
mailed the notice of such meeting within 20 days after receipt of such written
request, then the Company or the Holders of Notes in the amount above specified
may determine the time and place in the City of New York, New York or elsewhere
for such meeting and may call such meeting for the purpose of taking such
action, by mailing or causing to be mailed notice thereof as provided in Section
10.2, or by causing notice thereof to be published at least once in each of two
successive calendar weeks (on any Business Day during such week) in a newspaper
or newspapers printed in the English language, customarily published at least
five days a week of a general circulation in the City of New York, State of New
York, the first such publication to be not less than 10 nor more than 60 days
prior to the date fixed for the meeting.
Section 10.4. Who May Attend and Vote at Meetings.
To be entitled to vote at any meeting of Noteholders, a Person
shall (a) be a registered Holder of one or more Notes, or (b) be a Person
appointed by an instrument in writing as proxy for the registered Holder or
Holders of Notes. The only Persons who shall be entitled to be present or to
speak at any meeting of Noteholders shall be the Persons entitled to vote at
such meeting and their counsel and any representatives of the Trustee and its
counsel and any representatives of the Company and its counsel.
Section 10.5. Regulations May Be Made by Trustee; Conduct of the Meeting: Voting
Rights: Adjournment.
Notwithstanding any other provision of this Indenture, the
Trustee may make such reasonable regulations as it may deem advisable for any
action by or any meeting of Noteholders, in regard to proof of the holding of
Notes and of the appointment of proxies, and in regard to the appointment and
duties of inspectors of votes, and submission and examination of proxies,
certificates and other evidence of the right to vote, and such other matters
concerning the conduct of the meeting as it shall think appropriate. Such
regulations may fix a record date and time for determining the Holders of record
of Notes entitled to vote at such meeting, in which case those and only those
Persons who are Holders of Notes at the record date and time so fixed, or their
proxies, shall be entitled to vote at such meeting whether or not they shall be
such Holders at the time of the meeting.
The Trustee shall, by an instrument in writing, appoint a
temporary chairman of the meeting, unless the meeting shall have been called by
the Company or by Noteholders as provided in Section 10.3, in which case the
Company or the Noteholders calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by vote of the Holders of a majority
in principal amount of the Notes represented at the meeting and entitled to
vote.
At any meeting each Noteholder or proxy shall be entitled to
one vote for each $1,000 principal amount of Notes held or represented by him;
provided, however, that no vote shall be cast or counted at any meeting in
respect of any Notes challenged as not outstanding and ruled by the chairman of
the meeting to be not then outstanding. The chairman of the meeting shall have
no right to vote other than by virtue of Notes held by him or instruments in
writing as aforesaid duly designating him as the proxy to vote on behalf of
other Noteholders. Any meeting of Noteholders duly called pursuant to the
provisions of Section 10.2 or Section 10.3 may be adjourned from time to time by
vote of the Holder or Holders of a majority in aggregate principal amount of the
Notes represented at the meeting and entitled to vote, and the meeting may be
held as so adjourned without further notice.
Section 10.6. Voting at the Meeting and Record to Be Kept.
The vote upon any resolution submitted to any meeting of
Noteholders shall be by written ballots on which shall be subscribed the
signatures of the Holders of Notes or of their representatives by proxy and the
principal amount of the Notes voted by the ballot. The permanent chairman of the
meeting shall appoint two inspectors of votes, who shall count all votes cast at
the meeting for or against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in duplicate of all
votes cast at the meeting. A record in duplicate of the proceedings of each
meeting of Noteholders shall be prepared by the secretary of the meeting and
there shall be attached to such record the original reports of the inspectors of
votes on any vote by ballot taken thereat and affidavits by one or more Persons
having knowledge of the facts, setting forth a copy of the notice of the meeting
and showing that such notice was mailed as provided in Section 10.2 or published
as provided in Section 10.3. The record shall be signed and verified by the
affidavits of the permanent chairman and the secretary of the meeting and one of
the duplicates shall be delivered to the Company and the other to the Trustee to
be preserved by the Trustee, the latter to have attached thereto the ballots
voted at the meeting.
Any record so signed and verified shall be conclusive evidence
of the matters therein stated.
Section 10.7. Exercise of Rights of Trustee or Holders May Not Be Hindered or
Delayed by Call of Meeting.
Nothing contained in this Article X shall be deemed or
construed to authorize or permit, by reason of any call of a meeting of
Noteholders or any rights expressly or impliedly conferred hereunder to make
such call, any hindrance or delay in the exercise of any right or rights
conferred upon or reserved to the Trustee or to the Noteholders under any of the
provisions of this Indenture or of the Notes.
ARTICLE XI.
RIGHT TO REQUIRE REPURCHASE UPON A CHANGE OF CONTROL
Section 11.1. Repurchase of Notes at Option of the Holder Upon a Change of
Control.
(a) Subject to Section 11.2, in the event that a Change of Control
occurs, the Company shall offer, subject to the terms and conditions of this
Indenture, to purchase all or any part of each Holder's Notes (provided, that
the principal amount of such Notes must be $1,000 or an integral multiple
thereof) on the date (the "Repurchase Date") that is no later than 45 Business
Days (except as hereinafter provided) after the occurrence of such Change of
Control, at a cash price (the "Repurchase Price") equal to 100% of the principal
amount thereof, together with accrued and unpaid interest and Liquidated
Damages, if any, to (but excluding) the Repurchase Date.
(b) In the event that, pursuant to this Section 11.1, the Company shall
be required to commence an offer to purchase Notes (a "Repurchase Offer"), the
Company shall follow the procedures set forth in this Section 11.1 as follows:
(1) the Repurchase Offer shall commence within 25 Business
Days following a Change of Control;
(2) the Repurchase Offer shall remain open for 20 Business
Days following its commencement, except to the extent that a longer period is
required by applicable law (the "Repurchase Offer Period");
(3) upon the expiration of a Repurchase Offer Period, the
Company shall purchase all Notes tendered in response to the Repurchase Offer;
(4) if the Repurchase Date is on or after an interest payment
record date and on or before the related Interest Payment Date, any accrued
interest and Liquidated Damages will be paid to the Person in whose name a Note
is registered at the close of business on such record date, and no additional
interest or Liquidated Damages will be payable to Noteholders who tender Notes
pursuant to the Repurchase Offer;
(5) the Company shall provide the Trustee with written notice
of the Repurchase Offer at least 5 Business Days before the commencement of any
Repurchase Offer (or such shorter period that is satisfactory to the Trustee);
and
(6) on or before the commencement of any Repurchase Offer, the
Company or the Trustee (upon the request and at the expense of the Company)
shall send, by first-class mail, a notice to each of the Noteholders, which (to
the extent consistent with this Indenture) shall govern the terms of the
Repurchase Offer and shall state:
(i) that the Repurchase Offer is being made pursuant to such
notice and this Section 11.1 and that all Notes, or portions thereof,
tendered will be accepted for payment;
(ii) the Repurchase Price (including the amount of accrued and
unpaid interest and Liquidated Damages, if any), the Repurchase Date
and the Repurchase Put Date;
(iii) that any Note, or portion thereof, not tendered and
accepted for payment will continue to accrue interest and Liquidated
Damages, if any;
(iv) that, unless the Company defaults in depositing Cash with
the Paying Agent in accordance with the last paragraph of this clause
(b) or such payment is prevented pursuant to Article XII, any Note, or
portion thereof, accepted for payment pursuant to the Repurchase Offer
shall cease to accrue interest and Liquidated Damages after the
Repurchase Date;
(v) that Holders electing to have a Note, or portion thereof,
purchased pursuant to a Repurchase Offer will be required to surrender
the Note, with the form entitled "Option of Holder to Elect Purchase"
on the reverse of the Note completed, to the Paying Agent (which may
not for purposes of this Section 11.1, notwithstanding anything in this
Indenture to the contrary, be the Company or any Affiliate of the
Company) at the address specified in the notice prior to the close of
business on the earlier of (a) the third Business Day prior to the
Repurchase Date and (b) the third Business Day following the expiration
of the Repurchase Offer (such earlier date being the "Repurchase Put
Date");
(vi) that Holders will be entitled to withdraw their election,
in whole or in part, if the Paying Agent (which may not for purposes of
this Section 11.1, notwithstanding anything in this Indenture to the
contrary, be the Company or any Affiliate of the Company) receives, up
to the close of business on the Repurchase Put Date, a telegram,
facsimile transmission or letter setting forth the name of the Holder,
the Certificate number or CUSIP number of the relevant Global Note, the
principal amount of the Notes the Holder is withdrawing and a statement
that such Holder is withdrawing his election to have such principal
amount of Notes purchased; and
(vii) a brief description of the events resulting in such
Change of Control.
Any such Repurchase Offer shall comply with all applicable
provisions of federal and state laws, including those regulating tender offers,
if applicable, and any provisions of this Indenture which conflict with such
laws shall be deemed to be superseded by the provisions of such laws.
On or before the Repurchase Date, the Company shall (i) accept
for payment Notes or portions thereof properly tendered pursuant to the
Repurchase Offer, (ii) deposit with the Paying Agent Cash sufficient to pay the
Repurchase Price (together with accrued and unpaid interest and Liquidated
Damages, if any) of all Notes or portions thereof so tendered and (iii) deliver
to the Trustee the Notes so accepted together with an Officers' Certificate
listing the Notes or portions thereof being purchased by the Company. The Paying
Agent will promptly mail to Holders of Notes so accepted payment in an amount
equal to the Repurchase Price (together with accrued and unpaid interest and
Liquidated Damages, if any), and the Trustee shall promptly authenticate make
available for delivery to such Holders a new Note or Notes equal in principal
amount to any unpurchased portion of the Notes surrendered. Any Notes not so
accepted shall be promptly mailed or delivered by the Company to the Holder
thereof. The Company shall publicly announce the results of the Repurchase Offer
on or as soon as practicable after the Repurchase Date.
Section 11.2. Rescission of Change of Control Determination.
At any time prior to the close of business on the Business Day
immediately preceding the Repurchase Date, the Holders of more than 66-2/3% in
aggregate principal amount of the then outstanding Notes, by written act of said
Holders delivered to the Company and the Trustee, may determine that the event
giving rise to the Change of Control shall not be treated as a Change of Control
for purposes of Section 11.1, in which event:
(1) the provisions of Section 11.1(a) shall not apply;
(2) if a Repurchase Offer has been made by the Company
pursuant to Section 11.1 (b), such Repurchase Offer shall be deemed revoked; and
(3) if any Notes have been tendered in response to the revoked
Repurchase Offer, such tenders shall be deemed rescinded and the Notes promptly
returned to the Holders thereof.
Following a determination by the Holders pursuant to this
Section 11.2, the Company shall mail to all Holders a notice briefly describing
such determination. Any failure of the Company to mail such notice, or any
defect therein, shall not, however, in any way impair or affect the validity of
any such determination. An effective determination under this Section 11.2 shall
be binding on all holders.
ARTICLE XII.
SUBORDINATION
Section 12.1. Notes Subordinated to Senior Indebtedness.
The Company and each Holder, by its acceptance of Notes, agree
that (a) the payment of the principal of and interest on the Notes and (b) any
other payment in respect of the Notes, including on account of the acquisition
or redemption of the Notes by the Company and any premium and Liquidated Damages
(including, without limitation, pursuant to Article XI (but specifically
excluding payments to the Trustee for its own benefit), and including the
payment of cash, property or securities (other than Junior Securities) upon
conversion of a Note, is subordinated, to the extent and in the manner provided
in this Article XII, to the prior payment in full of all Senior Indebtedness of
the Company, whether outstanding at the date of this Indenture or thereafter
created, incurred, assumed or guaranteed, and that these subordination
provisions are for the benefit of the holders of Senior Indebtedness.
This Article XII shall constitute a continuing offer to all
Persons who, in reliance upon such provisions, become holders of, or continue to
hold, Senior Indebtedness, and such provisions are made for the benefit of the
holders of Senior Indebtedness, and such holders are made obligees hereunder and
any one or more of them may enforce such provisions.
Section 12.2. No Payment on Notes in Certain Circumstances.
(a) No payment may be made by the Company, directly or through
any Subsidiary, on account of the principal of, premium, if any, interest on, or
Liquidated Damages with respect to, the Notes, or to acquire any of the Notes
(including repurchases of Notes at the option of the Holder) for cash or
property (other than Junior Securities), or on account of the redemption
provisions of the Notes, (i) upon the maturity of any Senior Indebtedness by
lapse of time, acceleration (unless waived) or otherwise, unless and until all
principal of, premium, if any, and interest on and other amounts payable in
respect of Senior Indebtedness are first paid in full (or such payment is duly
provided for), or (ii) in the event of default in the payment of any principal
of, premium, if any, or interest on any Senior Indebtedness when it becomes due
and payable, whether at maturity or at a date fixed for prepayment or by
declaration or otherwise (collectively, a "Payment Default"), unless and until
such Payment Default has been cured or waived or otherwise has ceased to exist.
(b) Upon (i) the happening of an event of default (other than
a Payment Default) that permits, or would permit, with (w) the passage of time,
(x) the giving of notice, (y) the making of any payment of the Notes then
required to be made, or (z) any combination thereof (collectively, a
"Non-Payment Default"), the holders of Senior Indebtedness under the Credit
Facility or the holders of other Senior Indebtedness having a principal amount
then outstanding in excess of $10,000,000 (or with respect to which Senior
Indebtedness the holders are obligated to lend the Company in excess of
$10,000,000 principal amount) or their representative immediately to accelerate
the maturity of such Indebtedness and (ii) written notice of such Non-Payment
Default being given to the Company and the Trustee by the holders of Senior
Indebtedness under the Credit Facility or by the holders of such other Senior
Indebtedness or their representative (a "Payment Notice"), then, unless and
until such Non-Payment Default has been cured or waived or otherwise has ceased
to exist, no payment (by set-off or otherwise) may be made by or on behalf of
the Company, directly or through any Subsidiary, on account of the principal of,
premium, if any, interest on, or Liquidated Damages with respect to, the Notes,
or to acquire or repurchase any of the Notes for cash or property, or on account
of the redemption provisions of the Notes, in any such case other than payments
made with Junior Securities. Notwithstanding the foregoing, unless (i) the
Senior Indebtedness in respect of which such Non-Payment Default exists has been
declared due and payable in its entirety within 179 days after the Payment
Notice is delivered as set forth above (the "Payment Blockage Period"), and (ii)
such declaration has not been rescinded or waived, at the end of the Payment
Blockage Period, the Company shall be required to pay to the Holders of the
Notes all regularly scheduled payments on the Notes that were not paid during
the Payment Blockage Period due to the foregoing prohibitions (and upon the
making of such payments any acceleration of the Notes made during the Payment
Blockage Period shall be of no further force or effect) and to resume all other
payments as and when due on the Notes. Not more than one Payment Notice may be
given in any consecutive 365-day period, irrespective of the number of defaults
with respect to Senior Indebtedness during such period. In no event, however,
may the total number of days during which any Payment Blockage Period is or
Payment Blockage Periods are in effect exceed 179 days in the aggregate during
any consecutive 365 day period.
(c) In furtherance of the provisions of Section 12.1, in the
event that, notwithstanding the foregoing provisions of this Section 12.2, any
payment or distribution of assets of the Company or any Subsidiary (other than
Junior Securities) shall be received by the Trustee for the benefit of the
Holders or the Holders or any Paying Agent for the benefit of the Holders at a
time when such payment or distribution is prohibited by the provisions of this
Section 12.2, then such payment or distribution (subject to the provisions of
Article VII and Sections 12.6, 12.7 and 12.12) shall be received and held in
trust by the Trustee or such Holder or Paying Agent for the benefit of the
holders of Senior Indebtedness, and shall be paid or delivered by the Trustee or
such Holders or such Paying Agent, as the case may be, to the holders of Senior
Indebtedness remaining unpaid or their representative or representatives, or to
the trustee or trustees under any indenture pursuant to which any instruments
evidencing any of such Senior Indebtedness may have been issued, ratably
according to the aggregate amounts remaining unpaid on account of the Senior
Indebtedness held or represented by each, for application to the payment of all
Senior Indebtedness in full after giving effect to any concurrent payment and
distribution to the holders of such Senior Indebtedness.
Section 12.3. Notes Subordinated to Prior Payment of All Senior Indebtedness on
Dissolution Liquidation or Reorganization.
Upon any distribution of assets of the Company upon any
dissolution, winding up, total or partial liquidation or reorganization of the
Company, whether voluntary or involuntary, in bankruptcy, insolvency,
receivership or a similar proceeding or upon assignment for the benefit of
creditors or any marshaling of assets or liabilities:
(a) the holders of all Senior Indebtedness shall first be entitled to
receive payment in full (or have such payment duly provided for) before the
Holders of the Notes are entitled to receive any payment on account of the
principal of, premium, if any, interest on, and Liquidated Damages with respect
to, the Notes (other than Junior Securities);
(b) any payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities (other than Junior
Securities) to which the Holders of the Notes or the Trustee on behalf of the
Holders would be entitled (by setoff or otherwise), except for the provisions of
this Article XII, shall be paid by the liquidating trustee or agent or other
Person making such a payment or distribution directly to the holders of Senior
Indebtedness or their representative to the extent necessary to make payment in
full of all such Senior Indebtedness remaining unpaid, after giving effect to
any concurrent payment or distribution, or provision therefor, to the holders of
such Senior Indebtedness (but this Section 12.3(b) shall not apply to payments
or distributions to the Trustee for its own benefit); and
(c) in the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company or any Subsidiary (other than Junior
Securities) shall be received by the Holders of the Notes or the Trustee on
behalf of the Holders or any Paying Agent at the time when such payment or
distribution is prohibited by the foregoing provisions, such payment or
distribution shall be held in trust for the benefit of the holders of Senior
Indebtedness, and shall be paid or delivered by such Holders or the Trustee or
such Paying Agent, as the case may be, to the holders of the Senior Indebtedness
remaining unpaid or unprovided for or their representative or representatives,
or to the trustee or trustees under any indenture pursuant to which any
instruments evidencing any of such Senior Indebtedness may have been issued,
ratably according to the aggregate amounts remaining unpaid on account of the
Senior Indebtedness held or represented by each, for application to the payment
of all Senior Indebtedness remaining unpaid, to the extent necessary to pay or
to provide for the payment of all such Senior Indebtedness in full after giving
effect to any concurrent payment or distribution, or provision therefor, to the
holders of such Senior Indebtedness.
Section 12.4. Noteholders to Be Subrogated to Rights of Holders of Senior
Indebtedness.
Subject to the payment in full of all Senior Indebtedness as
provided herein, the Holders of Notes shall be subrogated to the rights of the
holders of such Senior Indebtedness to receive payments or distributions of
assets of the Company applicable to the Senior Indebtedness until all amounts
owing on the Notes shall be paid in full, and for the purpose of such
subrogation no such payments or distributions to the holders of such Senior
Indebtedness by the Company, or by or on behalf of the Holders by virtue of this
Article XII, which otherwise would have been made to the Holders shall, as
between the Company and the Holders, be deemed to be payment by the Company or
on account of such Senior Indebtedness, it being understood that the provisions
of this Article XII are and are intended solely for the purpose of defining the
relative rights of the Holders, on the one hand, and the holders of such Senior
Indebtedness, on the other hand.
If any payment or distribution to which the Holders would
otherwise have been entitled but for the provisions of this Article XII shall
have been applied, pursuant to the provisions of this Article XII, to the
payment of amounts payable under Senior Indebtedness, then the Holders shall be
entitled to receive from the holders of such Senior Indebtedness any payments or
distributions received by such holders of Senior Indebtedness in excess of the
amount sufficient to pay all amounts payable under or in respect of such Senior
Indebtedness in full.
Section 12.5. Obligations of the Company Unconditional.
Nothing contained in this Article XII or elsewhere in this
Indenture or in the Notes is intended to or shall impair as between the Company
and the Holders the obligation of each such Person, which is absolute and
unconditional, to pay to the Holders the principal of, premium, if any, interest
on, and Liquidated Damages with respect to, the Notes as and when the same shall
become due and payable in accordance with their terms, or is intended to or
shall affect the relative rights of the Holders and creditors of the Company
other than the holders of the Senior Indebtedness, nor shall anything herein or
therein prevent the Trustee or any Holder from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article XII, of the holders of Senior Indebtedness in
respect of cash, property or securities of the Company received upon the
exercise of any such remedy. Notwithstanding anything to the contrary in this
Article XII or elsewhere in this Indenture or in the Notes, upon any
distribution of assets of the Company referred to in this Article XII, the
Trustee, subject to the provisions of Sections 7.1 and 7.2, and the Holders
shall be entitled to rely upon any order or decree made by any court of
competent jurisdiction in which such dissolution, winding up, liquidation or
reorganization proceedings are pending, or a certificate of the liquidating
trustee or agent or other Person making any distribution to the Trustee or to
the Holders, for the purpose of ascertaining the Persons entitled to participate
in such distribution, the holders of the Senior Indebtedness and other
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article XII so long as such court has been apprised of the provisions
of, or the order, decree or certificate makes reference to, the provisions of
this Article XII. Nothing in this Section 12.5 shall apply to the claims of, or
payments to, the Trustee under or pursuant to Section 7.7 or otherwise for its
own benefit.
Section 12.6. Trustee and Other Agents Entitled to Assume Payments Not
Prohibited in Absence of Notice.
The Trustee and all other Agents shall not at any time be
charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee unless and until a Trust Officer of
the Trustee or any Paying Agent shall have actually received, no later than one
Business Day prior to such payment, written notice thereof in compliance with
Section 14.2 from the Company or from one or more holders of Senior Indebtedness
or from any representative therefor and, prior to the receipt of any such
written notice, the Trustee, subject to the provisions of Sections 7.1 and 7.2,
shall be entitled in all respects conclusively to assume that no such fact
exists.
Section 12.7. Application by Trustee of Assets Deposited with It.
Amounts deposited in trust with the Trustee pursuant to and in
accordance with this Indenture shall be, subject to Section 7.7, for the sole
benefit of Noteholders and, to the extent allocated for the payment of Notes,
shall not be subject to the subordination provisions of this Article XII.
Otherwise, any deposit of assets with the Trustee or any other Agent (whether or
not in trust) for the payment of principal of or interest on any Notes shall be
subject to the provisions of Sections 12.1, 12.2, 12.3 and 12.4; provided that
by, if prior to one Business Day preceding the date on which by the terms of
this Indenture any such assets may become distributable for any purpose
(including, without limitation, the payment of either principal of or interest
on any Note) the Trustee or such Paying Agent shall not have received with
respect to such assets the written notice provided for in Section 12.6, then the
Trustee or such Paying Agent shall have full power and authority to receive such
assets and to apply the same to the purpose for which they were received,
without liability, and shall not be affected by any notice to the contrary which
may be received by it on or after such date.
Section 12.8. Subordination Rights Not Impaired by Acts or Omissions of the
Company or Holders of Senior Indebtedness.
No right of any present or future holders of any Senior
Indebtedness to enforce subordination provisions contained in this Article XII
shall at any time in any way be prejudiced or impaired by any act or failure to
act on the part of the Company or by any act or failure to act, in good faith,
by any such holder, or by any noncompliance by the Company with the terms of
this Indenture, regardless of any knowledge thereof which any such holder may
have or be otherwise charged with. The holders of Senior Indebtedness may
extend, renew, modify or amend the terms of the Senior Indebtedness or any
security therefor and release, sell or exchange such security and otherwise deal
freely with the Company, all without affecting the liabilities and obligations
of the parties to this Indenture or the Holders.
Section 12.9. Noteholders Authorize Trustee to Effectuate Subordination of
Notes.
Each Holder of the Notes by his acceptance thereof authorizes
the Trustee on his behalf to take such action as may be necessary or appropriate
to effectuate the subordination provisions contained in this Article XII and to
protect the rights of the Holders pursuant to this Indenture, and appoints the
Trustee his attorney-in-fact for such purpose, including, in the event of any
dissolution, winding up, liquidation or reorganization of the Company (whether
in bankruptcy, insolvency or receivership proceedings or upon an assignment for
the benefit of creditors of the Company), the immediate filing of a claim for
the unpaid balance of his Notes in the form required in said proceedings and
cause said claim to be approved. If the Trustee does not file a proper claim or
proof of debt in the form required in such proceeding prior to 30 days before
the expiration of the time to file such claim or claims, then the holders of the
Senior Indebtedness or their representative are or is hereby authorized to have
the right to file and are or is hereby authorized to file an appropriate claim
for and on behalf of the Holders of said Notes. Nothing herein contained shall
be deemed to authorize the Trustee or the holders of Senior Indebtedness or
their representative to authorize or consent to or accept or adopt on behalf of
any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof, or to
authorize the Trustee or the holders of Senior Indebtedness or their
representative to vote in respect of the claim of any Noteholder in any such
proceeding.
Section 12.10. Right of Trustee to Hold Senior Indebtedness.
The Trustee shall be entitled to all of the rights set forth
in this Article XII in respect of any Senior Indebtedness at any time held by it
to the same extent as any other holder of Senior Indebtedness, and nothing in
this Indenture shall be construed to deprive the Trustee of any of its rights as
such holder.
Section 12.11. Article XII Not to Prevent Events of Default.
The failure to make a payment on account of principal of,
premium, if any, interest on, or Liquidated Damages with respect to, the Notes
by reason of any provision of this Article XII shall not be construed as
preventing the occurrence of a Default or an Event of Default under Section 6.1
or in any way prevent the Holders from exercising any right hereunder other than
the right to receive payment on the Notes.
Section 12.12. No Duty of Trustee and Other Agents to Holders of Senior
Indebtedness.
The Trustee and the other Agents shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness, and shall not be
liable to any such holders (other than for its willful misconduct or negligence)
if it shall in good faith mistakenly pay over or distribute to the Holders of
Notes or the Company or any other Person, cash, property or securities to which
any holders of Senior Indebtedness shall be entitled by virtue of this Article
XII or otherwise. Nothing in this Section 12.12 shall affect the obligation of
any other such Person receiving such payment or distribution from the Trustee or
any other Agent to hold such payment for the benefit of, and to pay such payment
over to, the holders of Senior Indebtedness or their representative.
ARTICLE XIII.
CONVERSION OF NOTES
Section 13.1. Conversion Privilege.
Subject to and upon compliance with the provisions of this
Article XIII, at the option of the Holder thereof, any Note may at any time, be
converted, in whole, or in part in integral multiples of $1,000 principal
amount, into fully paid and non-assessable shares of Common Stock issuable upon
conversion of the Notes, at the conversion price in effect at the Date of
Conversion, until and including, but not after the close of business on the
Stated Maturity, unless such Note or some portion thereof shall have been called
for redemption or delivered for repurchase prior to such date and no default is
made in making due provision for the payment of the Redemption Price or the
Repurchase Price, as the case may be, in accordance with the terms of this
Indenture, in which case, with respect to such Note or portion thereof as has
been so called for redemption or delivered for repurchase, such Note or portion
thereof may be so converted until and including, but not after, the close of
business on the Business Day immediately prior to the Redemption Date or
Repurchase Date, as applicable, for such Note, unless the Company subsequently
fails to pay the applicable Redemption Price or Repurchase Price, as the case
may be.
Section 13.2. Exercise of Conversion Privilege.
In order to exercise the conversion privilege, the Holder of
any Note to be converted shall surrender such Note to the Company at any time
during usual business hours at its office or agency maintained for the purpose
as provided in this Indenture, accompanied by a fully executed written notice,
in substantially the form set forth on the reverse of the Note, that the Holder
elects to convert such Note or a stated portion thereof constituting an integral
multiple of $1,000 principal amount, and, if such Note is surrendered for
conversion during the period between the close of business on any Record Date
and the opening of business on the next following Interest Payment Date and has
not been called for redemption on a Redemption Date which occurs within such
period, accompanied (except in the case of the Interest Payment Date occurring
on November 1, 2000) also by payment of an amount equal to the interest payable
on such Interest Payment Date on the principal amount of the Note being
surrendered for conversion, notwithstanding such conversion. Such notice of
conversion shall also state the name or names (with address) in which the
certificate or certificates for shares of Common Stock shall be issued. Notes
surrendered for conversion shall (if reasonably required by the Company or the
Trustee) be duly endorsed by, or be accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company duly executed by,
the Holder or his attorney duly authorized in writing. As promptly as
practicable after the receipt of such notice and the surrender of such Note as
aforesaid, the Company shall, subject to the provisions of Section 13.8 hereof,
issue and deliver at such office or agency to such Holder, or on his written
order, a certificate or certificates for the number of full shares of Common
Stock issuable on such conversion of Notes in accordance with the provisions of
this Article XIII and Cash, as provided in Section 13.3 hereof, in respect of
any fraction of a share of Common Stock otherwise issuable upon such conversion.
Such conversion shall be deemed to have been effected immediately prior to the
close of business on the date (herein called the "Date of Conversion") on which
such Note shall have been surrendered as aforesaid, and the person or persons in
whose name or names any certificate or certificates for shares of Common Stock
shall be issuable upon such conversion shall be deemed to have become on the
Date of Conversion the holder or holders of record of the shares represented
thereby; provided, however, that any such surrender on any date when the stock
transfer books of the Company shall be closed shall cause the person or persons
in whose name or names the certificate or certificates for such shares are to be
issued to be deemed to have become the record holder or holders thereof for all
purposes at the opening of business on the next succeeding day on which such
stock transfer books are open but such conversion shall nevertheless be at the
conversion price in effect at the close of business on the date when such Note
shall have been so surrendered with the conversion notice. In the case of
conversion of a portion, but less than all, of a Note, the Company shall as
promptly as practicable execute, and the Trustee shall thereafter authenticate
and deliver to the Holder thereof, at the expense of the Company, a Note or
Notes in the aggregate principal amount of the unconverted portion of the Note
surrendered. Except as otherwise expressly provided in this Indenture, no
payment or adjustment shall be made for interest accrued on any Note (or portion
thereof) converted or for dividends or distributions on any Common Stock issued
upon conversion of any Note.
Section 13.3. Fractional Interests.
No fractions of shares or scrip representing fractions of
shares shall be issued upon conversion of Notes. If more than one Note shall be
surrendered for conversion at one time by the same holder, the number of full
shares which shall be issuable upon conversion thereof shall be computed on the
basis of the aggregate principal amount of the Notes so surrendered. If any
fraction of a share of Common Stock would, except for the foregoing provisions
of this Section 13.3, be issuable on the conversion of any Note or Notes, the
Company shall make payment in lieu thereof in an amount of Cash equal to the
value of such fraction computed on the basis of the last sale price of the
Common Stock as reported on the Nasdaq Stock Market's National Market (or if not
listed for trading thereon, then on the principal national securities exchange
or on the principal automated quotation system on which the Common Stock is
listed or admitted to trading) at the close of business on the Date of
Conversion or if no such sale takes place on such day, the last sale price for
such day shall be the average of the closing bid and asked prices regular way on
the Nasdaq Stock Market's National Market (or if not listed for trading thereon,
on the principal national securities exchange or on the principal automated
quotation system on which the Common Stock is listed or admitted to trading) for
such day (any such last sale price being hereinafter referred to as the "Last
Sale Price"). If on such Trading Day the Common Stock is not quoted by any such
organization, the fair value of such Common Stock on such day, as reasonably
determined in good faith by the Board of Directors of the Company, shall be
used.
Section 13.4. Conversion Price.
The conversion price per share of Common Stock issuable upon
conversion of the Notes (as such price may be adjusted, herein called the
"Conversion Price) shall initially be $44.50 (which reflects a conversion rate
of 22.4719 shares of Common Stock per $1,000 in principal amount of Notes).
Section 13.5. Adjustment of Conversion Price.
The Conversion Price shall be subject to adjustment from time
to time as follows:
(a) In case the Company shall make or pay a dividend or make a
distribution in shares of Common Stock on any class of Capital Stock of the
Company, the Conversion Price in effect immediately following the record date
fixed for the determination of stockholders entitled to receive such dividend or
other distribution shall be reduced by multiplying such Conversion Price by a
fraction of which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on such date and the denominator shall be
the sum of such number of shares and the total number of shares constituting
such dividend or other distribution. An adjustment made pursuant to this
subsection (a) shall become effective immediately, except as provided in
subsection (i) and (j) below, after such record date.
(b) In case the Company shall (1) subdivide its outstanding
shares of Common Stock into a greater number of shares or (2) combine or
reclassify its outstanding shares of Common Stock into a smaller number of
shares, the Conversion Price in effect immediately following the effectiveness
of such action shall be adjusted by multiplying such Conversion Price by a
fraction of which the numerator shall be the number of shares of Common Stock
outstanding immediately prior to such subdivision or combination and the
denominator shall be the number of shares outstanding immediately after giving
effect to such subdivision or combination. An adjustment made pursuant to this
subsection (b) shall become effective immediately, except as provided in
subsection (i) and (j) below, after the effective date of a subdivision or
combination.
(c) In case the Company shall issue rights, options or
warrants to all or substantially all holders of Common Stock entitling them to
subscribe for or purchase shares of Common Stock at a price per share less than
the then current market price per share of the Common Stock (as determined
pursuant to subsection (g) below) on the record date fixed for determination of
the stockholders entitled to receive such rights, option or warrants, the
Conversion Price in effect immediately following such record date shall be
adjusted to a price, computed to the nearest cent, so that the same shall equal
the price determined by multiplying:
(i) such Conversion Price by a fraction, of which
(ii) the numerator shall be (A) the number of shares of Common
Stock outstanding on such record date plus (B) the number of shares
which the aggregate offering price of the total number of shares so
offered for subscription or purchase would purchase at such current
market price (determined by multiplying such total number of shares by
the exercise price of such rights, options or warrants and dividing the
product so obtained by such current market price), and of which
(iii) the denominator shall be (A) the number of shares of
Common Stock outstanding on such record date plus (B) the number of
additional shares of Common Stock which are so offered for subscription
or purchase.
Such adjustment shall become effective immediately, except as
provided in subsection (i) and (j) below, after the record date for the
determination of holders entitled to receive such rights, options or warrants;
provided, however, that if any such rights, options or warrants issued by the
Company as described in this subsection (c) are only exercisable upon the
occurrence of certain triggering events, then the Conversion Price will not be
adjusted as provided in this subsection (c) until such triggering events occur.
Upon the expiration or termination of any rights, options or warrants without
the exercise of such rights, options or warrants, the Conversion Price then in
effect shall be adjusted immediately to the Conversion Price which would have
been in effect at the time of such expiration or termination had such rights,
options or warrants, to the extent outstanding immediately prior to such
expiration or termination, never been issued.
(d) In case the Company or any Subsidiary of the Company shall
distribute to all or substantially all holders of Common Stock, any of its
assets, evidences of indebtedness, cash or securities (other than (x) dividends
or distributions exclusively in cash, (y) any dividend or distribution for which
an adjustment is required to be made in accordance with subsection (a) or (c)
above and in mergers and consolidations to which Section 13.6 applies, or (z)
any distribution of rights or warrants subject to subsection (1) below) then in
each such case the Conversion Price in effect immediately following the record
date fixed for the determination of the stockholders entitled to such
distribution shall be adjusted so that the same shall equal the price determined
by multiplying such Conversion Price by a fraction of which the numerator shall
be the then current market price per share of the Common Stock (determined as
provided in subsection (g) below) on such record date less the then fair market
value (as reasonably determined in good faith by the Board of Directors of the
Company) of the portion of the assets so distributed applicable to one share of
Common Stock, and of which the denominator shall be such current market price
per share of the Common Stock. Such adjustment shall become effective
immediately, except as provided in subsection (i) and (j) below, after the
record date for the determination of stockholders entitled to receive such
distribution.
(e) In case the Company or any Subsidiary of the Company shall
make any distribution consisting exclusively of cash (excluding any cash portion
of distributions for which an adjustment is required to be made in accordance
with subsection (d) above, or cash distributed upon a merger or consolidation to
which Section 13.6 applies) to all or substantially all holders of Common Stock
in an aggregate amount that, combined together with (i) all other such all-cash
distributions made within the then preceding 12 months in respect of which no
adjustment pursuant to this subsection (e) has been made and (ii) any cash and
the fair market value of other consideration paid or payable in respect of any
tender or exchange offer by the Company or any of its Subsidiaries for Common
Stock concluded within the preceding 12 months in respect of which no adjustment
has been made, exceeds 15% of the Company's market capitalization (defined as
being the product of the then current market price of the Common Stock
(determined as provided in subsection (g) below) times the number of shares of
Common Stock then outstanding) on the record date fixed for the determination of
the stockholders entitled to such distribution, in each such case the Conversion
Price immediately following such record date shall be adjusted so that the same
shall equal the price determined by multiplying such Conversion Price by a
fraction of which the numerator shall be the then current market price per share
of the Common Stock on such record date less the amount of the cash and/or fair
market value (as reasonably determined in good faith by the Board of Directors
of the Company) of other consideration so distributed applicable to one share of
Common Stock, and of which the denominator shall be such current market price
per share of the Common Stock. Such adjustment shall become effective
immediately, except as provided in subsection (i) and (j) below, after the
record date for the determination of stockholders entitled to receive such
distribution.
(f) In case the Company or any Subsidiary of the Company shall
complete a tender or exchange offer for all or any portion of the Common Stock
(any such tender or exchange offer being referred to as an "Offer") to the
extent that the aggregate consideration of such Offer, having a fair market
value as of the expiration of such Offer (the "Expiration Time"), together with
(i) any cash and the fair market value of any other consideration payable in
respect of any other tender or exchange offer for Common Stock, as of the
expiration of such other tender or exchange offer, expiring within the 12 months
preceding the expiration of such Offer and in respect of which no Conversion
Price adjustment pursuant to this subsection (f) has been made and (ii) the
aggregate amount of any all-cash distributions referred to in subsection (e) of
this Section 13.5 to all holders of Common Stock within the 12 months preceding
the expiration of such Offer for which no Conversion Price adjustment pursuant
to such subsection (e) has been made, exceeds 15% of the product of the then
current market price per share (determined as provided in subsection (g) below)
of the Common Stock on the Expiration Time times the number of shares of Common
Stock outstanding (including any tendered shares) on the Expiration Time, the
Conversion Price in effect immediately following such Expiration Time shall be
reduced by multiplying such Conversion Price by a fraction of which the
numerator shall be (i) the product of the then current market price per share
(determined as provided in subsection (g) below) of the Common Stock on the
Expiration Time times the number of shares of Common Stock outstanding
(including any tendered shares) on the Expiration Time minus (ii) the fair
market value of the aggregate consideration so in excess of such 15% and payable
to stockholders based on the acceptance (up to any maximum specified in the
terms of the Offer) of all shares validly tendered and not withdrawn as of the
Expiration Time (the shares deemed so accepted being referred to as the
"Purchased Shares") and the denominator shall be the product of (i) such current
market price per share on the Expiration Time times (ii) such number of
outstanding shares on the Expiration Time less the number of Purchased Shares,
such reduction to become effective immediately prior to the opening of business
on the day following the Expiration Time.
For purposes of this subsection (f), the fair market value of any
consideration with respect to an Offer shall be reasonably determined in good
faith by the Board of Directors of the Company and described in a Board
Resolution.
(g) For the purpose of any computation under subsections (c),
(d), (e) and (f) above, the current market price per share of Common Stock on
any date shall be deemed to be the average of the Last Sale Prices of a share of
Common Stock for the five consecutive Trading Days selected by the Company
commencing not more than 20 Trading Days before, and ending not later than, the
earlier ofthe date in question and the date before the "'ex' date," with respect
to the issuance, distribution or Offer requiring such computation. If on any
such Trading Day the Common Stock is not quoted by any organization referred to
in the definition of Last Sale Price in Section 13.3 hereof, the fair value of
the Common Stock on such day, as reasonably determined in good faith by the
Board of Directors of the Company, shall be used. For purposes of this
paragraph, the term "'ex' date," when used with respect to any issuance,
distribution or payments with respect to an Offer, means the first date on which
the Common Stock trades regular way on the Nasdaq Stock Market's National Market
(or if not listed or admitted to trading thereon, then on the principal national
securities exchange or automated quotation system if the Common Stock is listed
or admitted to trading thereon) without the right to receive such issuance,
distribution or Offer.
(h) In addition to the foregoing adjustments in subsections
(a), (b), (c), (d), (e) and (f) above, the Company, from time to time and to the
extent permitted by law, may reduce the Conversion Price by any amount for at
least 20 Business Days, if the Board of Directors has made a determination,
which determination shall be conclusive, that such reduction would be in the
best interests of the Company. The Company shall cause notice of such reduction
to be mailed to each Holder of Notes, in the manner specified in Section 13.7,
at least 15 days prior to the date on which such reduction commences. The
Company may, at its option, also make such reductions in the Conversion Price in
addition to those set forth above, as the Board of Directors deems advisable to
avoid or diminish any income tax to holders of shares of Common Stock resulting
from any dividend or distribution of stock (or rights to acquire stock) or from
any event treated as such for United States federal income tax purposes.
(i) In any case in which this Section 13.5 shall require that
an adjustment be made immediately following a record date, the Company may elect
to defer the effectiveness of such adjustment (but in no event until a date
later than the effective time of the event giving rise to such adjustment), in
which case the Company shall, with respect to any Note converted after such
record date and on and before such adjustment shall have become effective (i)
defer paying any Cash payment pursuant to Section 13.3 hereof or issuing to the
Holder of such Note the number of shares of Common Stock and other capital stock
of the Company (or other assets or securities) issuable upon such conversion in
excess of the number of shares of Common Stock and other Capital Stock of the
Company issuable thereupon only on the basis of the Conversion Price prior to
adjustment, and (ii) not later than five Business Days after such adjustment
shall have become effective, pay to such Holder the appropriate Cash payment
pursuant to Section 13.3 hereof and issue to such Holder the additional shares
of Common Stock and other Capital Stock of the Company issuable on such
conversion.
(j) No adjustment in the Conversion Price shall be required
unless such adjustment would require an increase or decrease of at least 1.0% of
the Conversion Price; provided, that any adjustments which by reason of this
subsection (i) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations under this Article
XIII shall be made to the nearest cent or to the nearest one-hundredth of a
share, as the case may be.
(k) Whenever the Conversion Price is adjusted as herein
provided, the Company shall promptly (i) file with the Trustee and each
conversion agent an Officers' Certificate setting forth the Conversion Price
after such adjustment and setting forth a brief statement of the facts requiring
such adjustment, which certificate shall be conclusive evidence of the
correctness of such adjustment, and (ii) mail or cause to be mailed a notice of
such adjustment to each holder of Notes at his address as the same appears on
the registry books of the Company.
(l) In the event that the Company distributes rights or
warrants (other than those referred to in subsection (c) above) pro rata to
holders of Common Stock, so long as any such rights or warrants have not expired
or been redeemed by the Company, the Company shall make proper provision so that
the Holder of any Note surrendered for conversion will be entitled to receive
upon such conversion, in addition to the shares of Common Stock issuable upon
such conversion (the "Conversion Shares"), a number of rights or warrants to be
determined as follows: (i) if such conversion occurs on or prior to the date for
the distribution to the holders of rights or warrants of separate certificates
evidencing such rights or warrants (the "Distribution Date"), the same number of
rights or warrants to which a holder of a number of shares of Common Stock equal
to the number of Conversion Shares is entitled at the time of such conversion in
accordance with the terms and provisions of and applicable to the rights or
warrants, and (ii) if such conversion occurs after such Distribution Date, the
same number of rights or warrants to which a holder of the number of shares of
Common Stock into which the principal amount of such Note so converted was
convertible immediately prior to such Distribution Date would have been entitled
on such Distribution Date in accordance with the terms and provisions of and
applicable to the rights or warrants.
Section 13.6. Continuation of Conversion Privilege in Case of Reclassification,
Change, Merger, Consolidation or Sale of Assets.
If any of the following shall occur, namely: (a) any
reclassification or change of outstanding shares of Common Stock issuable upon
conversion of the Notes (other than a change in par value, or from par value to
no par value, or from no par value, to par value, or as a result of a
subdivision or combination), (b) any consolidation or merger of the Company with
or into any other Person, or the merger of any other Person with or into the
Company (other than a merger which does not result in any reclassification,
change, conversion, exchange or cancellation of outstanding shares of Common
Stock) or (c) any sale, transfer or conveyance of all or substantially all of
the assets of the Company (computed on a consolidated basis), then the Company,
or such successor or purchasing entity, as the case may be, shall, as a
condition precedent to such reclassification, change, consolidation, merger,
sale or conveyance, execute and deliver to the Trustee a supplemental indenture
providing that the Holder of each Note then outstanding shall have the right to
convert such Note only into the kind and amount of shares of stock and other
securities and property (including cash) receivable upon such reclassification,
change, consolidation, merger, sale, transfer or conveyance by a holder of the
number of shares of Common Stock issuable upon conversion of such Note
immediately prior to such reclassification, change, consolidation, merger, sale,
transfer or conveyance assuming such holder of Common Stock of the Company
failed to exercise his rights of an election, if any, as to the kind or amount
of securities, cash and other property receivable upon such reclassification,
change, consolidation, merger, sale, transfer or conveyance (provided that if
the kind or amount of securities, cash, and other property receivable upon such
reclassification, change, consolidation, merger, sale, transfer or conveyance is
not the same for each share of Common Stock of the Company held immediately
prior to such reclassification, change, consolidation, merger, sale, transfer or
conveyance in respect of which such rights of election shall not have been
exercised ("non-electing share"), then for the purpose of this Section 13.6 the
kind and amount of securities, cash and other property receivable upon such
reclassification, change, consolidation, merger, sale, transfer or conveyance by
each non-electing share shall be deemed to be the kind and amount so receivable
per share by a plurality of the non-electing shares). Such supplemental
indenture shall provide for adjustments which shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Article XIII. If, in
the case of any such consolidation, merger, sale or conveyance, the stock or
other securities and property (including cash) receivable thereupon by a holder
of shares of Common Stock includes shares of stock or other securities and
property (including cash) of a corporation other than the successor or
purchasing corporation, as the case may be, in such consolidation, merger, sale
or conveyance, then such supplemental indenture shall also be executed by such
other corporation and shall contain such additional provisions to protect the
interests of the Holders of the Notes as the Board of Directors of the Company
shall reasonably consider necessary by reason of the foregoing. The provisions
of this Section 13.6 shall similarly apply to successive consolidations,
mergers, sales or conveyances.
Notice of the execution of each such supplemental indenture
shall be mailed to each Holder of Notes at his address as the same appears on
the registry books of the Company.
Neither the Trustee nor any conversion agent shall be under
any responsibility to determine the correctness of any provisions contained in
any such supplemental indenture relating either to the kind or amount of shares
of stock or securities or property (including cash) receivable by Holders of
Notes upon the conversion of their Notes after any such reclassification,
change, consolidation, merger, sale or conveyance or to any adjustment to be
made with respect thereto, but, subject to the provisions of Article VII hereof,
may accept as conclusive evidence of the correctness of any such provisions, and
shall be protected in relying upon, the Officers' Certificate (which the Company
shall be obligated to file with the Trustee prior to the execution of any such
supplemental indenture) with respect thereto.
Section 13.7. Notice of Certain Events.
In case:
(a) the Company shall declare a dividend (or any other distribution)
payable to the holders of Common Stock (other than cash dividends);
(b) the Company shall authorize the granting to the holders of Common
Stock of rights, warrants or options to subscribe for or purchase any shares of
stock of any class or of any other rights;
(c) the Company shall authorize any reclassification or change of the
Common Stock (including a subdivision or combination of its outstanding shares
of Common Stock), or any consolidation or merger to which the Company is a party
and for which approval of any stockholders of the Company is required, or the
sale or conveyance of all or substantially all the property or business of the
Company;
(d) there shall be proposed any voluntary or involuntary dissolution,
liquidation or winding-up of the Company; or
(e) the Company or any of its Subsidiaries shall complete an Offer;
then, the Company shall cause to be filed at the office or agency maintained for
the purpose of conversion of the Notes as provided in Section 13.2 hereof, and
shall cause to be mailed to each Holder of Notes, at his address as it shall
appear on the registry books of the Company, at least 20 days before the date
hereinafter specified (or the earlier of the dates hereinafter specified, in the
event that more than one date is specified), a notice stating the date on which
(1) a record is expected to be taken for the purpose of such dividend,
distribution, rights, warrants or options or Offer, or if a record is not to be
taken, the date as of which the holders of Common Stock of record to be entitled
to such dividend, distribution, rights, warrants or options or to participate in
such Offer are to be determined, or (2) such reclassification, change,
consolidation, merger, sale, conveyance, dissolution, liquidation or winding-up
is expected to become effective and the date, if any is to be fixed, as of which
it is expected that holders of Common Stock of record shall be entitled to
exchange their shares of Common Stock for securities or other property
deliverable upon such reclassification, change, consolidation, merger, sale,
conveyance, dissolution, liquidation or winding-up.
Section 13.8. Taxes on Conversion.
The Company will pay any and all documentary, stamp or similar
taxes payable to the United States of America or any political subdivision or
taxing authority thereof or therein in respect of the issue or delivery of
shares of Common Stock on conversion of Notes pursuant thereto; provided,
however, that the Company shall not be required to pay any tax which may be
payable in respect of any transfer involved in the issue or delivery of shares
of Common Stock in a name other than that of the Holder of the Notes to be
converted and no such issue or delivery shall be made unless and until the
person requesting such issue or delivery has paid to the Company the amount of
any such tax or has established, to the satisfaction of the Company, that such
tax has been paid. The Company extends no protection with respect to any other
taxes imposed in connection with conversion of Notes.
Section 13.9. Company to Provide Stock.
The Company shall reserve, free from pre-emptive rights, out
of its authorized but unissued shares, sufficient shares to provide for the
conversion of the Notes from time to time as such Notes are presented for
conversion, provided, that nothing contained herein shall be construed to
preclude the Company from satisfying its obligations in respect of the
conversion of Notes by delivery of repurchased shares of Common Stock which are
held in the treasury of the Company.
If any shares of Common Stock to be reserved for the purpose
of conversion of Notes hereunder require registration with or approval of any
governmental authority under any Federal or state law before such shares may be
validly issued or delivered upon conversion, then the Company covenants that it
will in good faith and as expeditiously as possible use all reasonable efforts
to secure such registration or approval, as the case may be, provided, however,
that nothing in this Section 13.9 shall be deemed to limit in any way the
obligations of the Company provided in this Article XIII.
Before taking any action which would cause an adjustment
reducing the Conversion Price below the then par value, if any, of the Common
Stock, the Company will take all corporate action which may, in the Opinion of
Counsel, be necessary in order that the Company may validly and legally issue
fully paid and non-assessable shares of Common Stock at such adjusted Conversion
Price.
The Company covenants that all shares of Common Stock which
may be issued upon conversion of Notes will upon issue be fully paid and
non-assessable by the Company and free of preemptive rights.
Section 13.10. Disclaimer of Responsibility for Certain Matters.
Neither the Trustee nor any agent of the Trustee shall at any
time be under any duty or responsibility to any Holder of Notes to determine
whether any facts exist which may require any adjustment of the Conversion
Price, or with respect to the Officers' Certificate referred to in Section 13.5
hereof, or with respect to the nature or extent of any such adjustment when
made, or with respect to the method employed, or herein or in any supplemental
indenture provided to be employed, in making the same. Neither the Trustee nor
any agent of the Trustee shall be accountable with respect to the validity or
value (or the kind or amount) of any shares of Common Stock, or of any
securities or property (including cash), which may at any time be issued or
delivered upon the conversion of any Note; and neither the Trustee nor any
conversion agent makes any representation with respect thereto. Neither the
Trustee nor any agent of the Trustee shall be responsible for any failure of the
Company to issue, register the transfer of or deliver any shares of Common Stock
or stock certificates or other securities or property (including cash) upon the
surrender of any Note for the purpose of conversion or, subject to Article VII
hereof, to comply with any of the covenants of the Company contained in this
Article XIII.
Section 13.11. Return of Funds Deposited for Redemption of Converted Notes.
Any funds which at any time shall have been deposited by the
Company or on its behalf with the Trustee or any other Paying Agent for the
purpose of paying the principal of and interest on any of the Notes and which
shall not be required for such purposes because of the conversion of such Notes,
as provided in this Article XIII, shall after such conversion be repaid to the
Company by the Trustee or such other Paying Agent.
ARTICLE XIV.
MISCELLANEOUS
Section 14.1. TIA Controls.
If any provision of this Indenture limits, qualifies, or
conflicts with the duties imposed by operation of the TIA, the imposed duties,
whether or not this Indenture has been qualified under the TIA, shall control.
Section 14.2. Notices.
Any notices or other communications to the Company or the
Trustee required or permitted hereunder shall be in writing, and shall be
sufficiently given if made by hand delivery, by telex, by telecopier or
registered or certified mail, postage prepaid, return receipt requested,
addressed as follows:
if to the Company:
Fine Host Corporation
3 Greenwich Office Park
Greenwich, Connecticut 06831
Attention: General Counsel
Telecopy: (203) 629-5089
if to the Trustee:
The Bank of New York
101 Barclay Street
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Telecopy: (212) 815-5915
Any party by notice to each other party may designate
additional or different addresses as shall be furnished in writing by such
party. Any notice or communication to any party shall be deemed to have been
given or made as of the date so delivered, if personally delivered; when receipt
is acknowledged, if telecopied; and five Business Days after mailing if sent by
registered or certified mail, postage prepaid (except that a notice of change of
address shall not be deemed to have been given until actually received by the
addressee).
Any notice or communication mailed to a Noteholder shall be
mailed to him by first class mail or other equivalent means at his address as it
appears on the registration books of the Registrar and shall be sufficiently
given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Noteholder or
any defect in it shall not affect its sufficiency with respect to other
Noteholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it except for
notices and communications to the Trustee which shall be effective only upon
actual receipt thereof. Section 14.3. Communications by Holders with Other
Holders.
Noteholders may communicate pursuant to TIA ss. 312(b) with
other Noteholders with respect to their rights under this Indenture or the
Notes. The Company, the Trustee, the Registrar and any other Person shall have
the protection of TIA ss. 312(c).
Section 14.4. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee
to take any action under this Indenture, the Company shall furnish to the
Trustee:
(1) An Officers' Certificate (in form and substance reasonably
satisfactory to the Trustee) stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with; and
(2) an Opinion of Counsel (in form and substance reasonably
satisfactory to the Trustee) stating that, in the opinion of such counsel, all
such conditions precedent have been complied with.
Section 14.5. Statements Required in Certificate or Opinion.
Each certificate or Opinion of Counsel with respect to
compliance with a condition or covenant provided for in this Indenture shall
include:
(1) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he has
made such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether or not, in the opinion of each
such Person, such condition or covenant has been complied with; provided,
however, that with respect to matters of fact an Opinion of Counsel may rely on
an Officers' Certificate or certificates of public officials.
Section 14.6. Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules for action by or at a
meeting of Noteholders. The Paying Agent or Registrar may make reasonable rules
for its functions.
Section 14.7. Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday or a day on which
banking institutions in New York, New York are authorized or obligated by law or
executive order to close. If a payment date is a Legal Holiday at such place,
payment may be made at such place on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period.
Section 14.8. Governing Law.
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES THEREOF, AS APPLIED TO CONTRACTS MADE AND PERFORMED
WITHIN THE STATE OF NEW YORK. THE COMPANY HEREBY IRREVOCABLY SUBMITS TO THE
JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN
THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN
THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS INDENTURE AND THE NOTES, AND IRREVOCABLY ACCEPTS FOR ITSELF
AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, JURISDICTION OF
THE AFORESAID COURTS. THE COMPANY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT
MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING
HEREIN SHALL AFFECT THE RIGHT OF THE TRUSTEE OR ANY NOTEHOLDER TO SERVE PROCESS
IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR
OTHERWISE PROCEED AGAINST THE COMPANY IN ANY OTHER JURISDICTION.
Section 14.9. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture,
loan or debt agreement of the Company or any of its Subsidiaries. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture.
Section 14.10. No Recourse Against Others.
No direct or indirect partner, employee, stockholder, director
or officer, as such, past, present or future of the Company or any successor
corporation, shall have any personal liability in respect of the obligations of
the Company under the Notes or this Indenture by reason of his, her or its
status as such partner, stockholder, employee, director or officer. Each
Noteholder by accepting a Note waives and releases all such liability. Such
waiver and release are part of the consideration for the issuance of the Notes.
Section 14.11. Successors.
All agreements of the Company in this Indenture and the Notes
shall bind its successor. All agreements of the Trustee in this Indenture shall
bind its successor.
Section 14.12. Duplicate Originals.
All parties may sign any number of copies or counterparts of
this Indenture. Each signed copy or counterpart shall be an original, but all of
them together shall represent the same agreement.
Section 14.13. Severability.
In case any one or more of the provisions in this Indenture or
in the Notes shall be held invalid, illegal or unenforceable, in any respect for
any reason, the validity, legality and enforceability of any such provision in
every other respect and of the remaining provisions shall not in any way be
affected or impaired thereby, it being intended that all of the provisions
hereof shall be enforceable to the full extent permitted by law.
Section 14.14. Table of Contents, Headings, Etc.
The Table of Contents, Cross-Reference Table and headings of
the Articles and the Sections of this Indenture have been inserted for
convenience of reference only, are not to be considered a part hereof and shall
in no way modify or restrict any of the terms or provisions hereof.
Section 14.15. Qualification of Indenture.
The Company shall qualify this Indenture under the TIA in
accordance with the terms and conditions of the Registration Rights Agreement
and shall pay all costs, fees and expenses (including attorneys' fees for the
Company and the Trustee) incurred in connection therewith, including, but not
limited to, costs, fees and expenses of qualification of the Indenture and
printing this Indenture and the Notes. The Trustee shall be entitled to receive
from the Company any such Officers' Certificates, Opinions of Counsel or other
documentation as it may reasonably request in connection with any such
qualification of this Indenture under the TIA.
Section 14.16. Registration Rights.
Certain Holders of the Notes are entitled to certain
registration rights with respect to such Notes pursuant to, and subject to the
terms of, the Registration Rights Agreement.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the date first written above.
FINE HOST CORPORATION, a Delaware corporation
By:______________________________
Name:
Title:
THE BANK OF NEW YORK, as Trustee
By:______________________________
Name:
Title:
<PAGE>
EXHIBIT A
[FORM OF NOTE]
FINE HOST CORPORATION
5% CONVERTIBLE SUBORDINATED NOTES DUE 2004
No.__ CUSIP No.___________
$__________
Fine Host Corporation, a Delaware corporation (hereinafter
called the "Company," which term includes any successors under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
____________________________, or registered assigns, the principal sum of
_________ Dollars, on November 1, 2004.
Interest Payment Dates: May 1 and November 1; commencing May
1, 1998.
Record Dates: April 15 and October 15.
Reference is made to the further provisions of this Note
hereinafter set forth, which will, for all purposes, have the same effect as if
set forth at this place.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
FINE HOST CORPORATION, a Delaware corporation
[Seal]
By:__________________________________
Name:
Title:
Attest:_______________________
Assistant Secretary
<PAGE>
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Notes described in the within-mentioned
Indenture.
Dated:___________
THE BANK OF NEW YORK, as
Trustee
By:_____________________________
Authorized Signatory
<PAGE>
FINE HOST CORPORATION
5% Convertible Subordinated Notes due 2004
Unless and until it is exchanged in whole or in part for Notes in
definitive form, this Note may not be transferred except as a whole by The
Depository Trust Company, a New York corporation ("Depositary"), to a nominee of
the Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary. Unless this
certificate is presented by an authorized representative of the Depository to
the Company or its agent for registration of transfer, exchange or payment, and
any certificate issued is registered in the name of Cede & Co. or in such other
name as is requested by an authorized representative of the Depositary (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of the Depositary), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein.1
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.
S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE SECURITIES LAWS, AND ACCORDINGLY, MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR
THE ACCOUNT OR BENEFIT OF U S. PERSONS, EXCEPT AS SET FORTH BELOW. BY
ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER
(1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB"), (B) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(A) (1),
(2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT (AN "IAI"), OR
(C) IT IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT
IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO
THE COMPANY OR ANY OF ITS SUBSIDIARIES, (B) TO A PERSON WHO THE HOLDER
REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QIB IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A
UNDER THE SECURITIES ACT, (C) TO AN IAI THAT, PRIOR TO SUCH TRANSFER,
FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THIS
SECURITY (THE FORM OF WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND, IF
THE COMPANY SO REQUESTS, AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT,
(D) IN AN OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR
904 OF REGULATION S UNDER THE SECURITIES ACT, (E) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (F) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO
THE COMPANY, THE TRUSTEE AND THE REGISTRAR) OR (G) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH
THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTION AND (3) AGREES THAT IT WILL DELIVER TO
EACH PERSON TO WHOM THIS SECURITY OR AN INTEREST HEREIN IS TRANSFERRED
A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED HEREIN,
THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES" HAVE THE MEANINGS
GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT. THE
INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO
REGISTER ANY TRANSFER OF THIS SECURITY IN VIOLATION OF THE FOREGOING.2
1. Interest.
Fine Host Corporation, a Delaware corporation (hereinafter called the
"Company," which term includes any successors under the Indenture hereinafter
referred to), promises to pay interest on the principal amount of this Note at
the rate of 5% per annum. To the extent it is lawful, the Company promises to
pay interest on any interest payment due but unpaid on such principal amount at
a rate of 5% per annum compounded semi-annually.
The Company will pay interest semi-annually in cash in arrears on May 1
and November 1 of each year (each, an "Interest Payment Date"), commencing May
1, 1998. Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid on the Notes, from
October 27, 1997. Interest will be computed on the basis of a 360-day year
consisting of twelve 30-day months.
2. Method of Payment.
The Company shall pay interest on the Notes (except defaulted interest)
to the Persons who are the registered Holders at the close of business on the
Record Date immediately preceding the Interest Payment Date. Holders must
surrender Notes to a Paying Agent to collect principal payments. Any such
interest not so punctually paid, and defaulted interest relating thereto, may be
paid to the Persons who are registered Holders at the close of business on a
Special Record Date for the payment of such defaulted interest, as more fully
provided in the Indenture referred to below. Except as provided below, the
Company shall pay principal and interest in such coin or currency of the United
States of America as at the time of payment shall be legal tender for payment of
public and private debts ("U.S. Legal Tender"). The Notes will be payable as to
principal, premium, interest and Liquidated Damages at the office or agency of
the Company maintained for such purpose within or without the City and State of
New York, or at the option of the Company, payment of principal, premium,
interest and Liquidated Damages may be made by check mailed to the Holders at
their addresses set forth in the registry of Holders, and provided that, upon
the request of The Depository Trust Company, a New York corporation (the
"Depositary"), payment by wire transfer of immediately available funds will be
required with respect to principal of, premium and interest on and Liquidated
Damages with respect to Global Notes and all other Notes held of record by the
Depositary, or its nominee, if the Depositary shall have provided wire transfer
instructions to the Company or the Paying Agent.
3. Paying Agent and Registrar.
The Bank of New York (the "Trustee") will act as Paying Agent and
Registrar. The Company may change any Paying Agent, Registrar or co-Registrar
without notice to the Holders. The Company or any of its Subsidiaries may,
subject to certain exceptions, act as Paying Agent, Registrar or co-Registrar.
4. Indenture.
The Company issued the Notes under an Indenture, dated as of October
27, 1997 (as amended or supplemented from time to time the "Indenture"), between
the Company and the Trustee. Capitalized terms herein are used as defined in the
Indenture unless otherwise defined herein. The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act, as in effect on the date of the Indenture. The Notes are
subject to all such terms, and Holders of Notes are referred to the Indenture
and said Act for a statement of them. The Notes are general unsecured
obligations of the Company limited in aggregate principal amount to
$200,000,000.
5. Redemption.
The Notes may be redeemed in whole or from time to time in part at any
time on and after November 1, 2000, at the option of the Company, at the
Redemption Price (expressed as a percentage of principal amount) set forth below
with respect to the indicated Redemption Date, in each case, plus any accrued
but unpaid interest and Liquidated Damages to the Redemption Date. The Notes may
not be so redeemed prior to November 1, 2000.
If redeemed during
the 12-month period
beginning on November 1 Redemption Price
2000.................................................102.857%
2001.................................................102.143%
2002.................................................101.429%
2003.................................................100.714%
Any such redemption will comply with Article III of the
Indenture.
6 Notice of Redemption.
Notice of redemption will be sent by first class mail, at least 30 days
and not more than 60 days prior to the Redemption Date to the Holder of each
Note to be redeemed at such Holder's last address as then shown upon the
registry books of the Registrar. Notes may be redeemed in part in integral
multiples of $1,000 only.
Except as set forth in the Indenture, from and after any Redemption
Date, if monies for the redemption of the Notes called for redemption shall have
been deposited with the Paying Agent on such Redemption Date and payment of the
Notes called for redemption is not prohibited under Article XII of the
Indenture, the Notes called for redemption will cease to bear interest and the
only right of the Holders of such Notes will be to receive payment of the
Redemption Price, plus any accrued and unpaid interest and Liquidated Damages,
if any, to the Redemption Date.
7 Denominations; Transfer; Exchange.
The Notes are in registered form, without coupons, in denominations of
$1,000 and integral multiples of $1,000. A Holder may register the transfer of
or exchange Notes in accordance with, the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any Notes
selected for redemption.
8 Persons Deemed Owners.
The registered Holder of a Note may be treated as the owner of it for
all purposes, subject to the provisions of the Indenture and the Notes with
respect to record dates.
9 Unclaimed Money.
If money for the payment of principal, interest or Liquidated Damages
remains unclaimed for two years, the Trustee and the Paying Agent(s) will pay
the money back to the Company at its written request. After that, all liability
of the Trustee and such Paying Agent(s) with respect to such money shall cease.
10 Amendment; Supplement; Waiver.
Subject to specified exceptions, the Indenture or the Notes may be
amended or supplemented, and any existing Default or Event of Default or
compliance with any provision may be waived, with the written consent of the
Holders of a majority in aggregate principal amount of the Notes then
outstanding. Without notice to or consent of any Holder, the parties thereto may
amend or supplement the Indenture or the Notes to, among other things, cure any
ambiguity, defect or inconsistency, or make any other change that does not
adversely affect the rights of any Holder of a Note.
11 Conversion Rights.
Subject to the provisions of the Indenture, the Holders have the right
to convert the principal amount of the Notes into fully paid and nonassessable
shares of Common Stock of the Company at the initial conversion price per share
of Common Stock of $44.50 (which reflects a conversion rate of 22.4719 shares of
Common Stock per $1,000 in principal amount of Notes), or at the adjusted
conversion price then in effect, if adjustment has been made as provided in the
Indenture, upon surrender of the Note to the Company, together with a fully
executed notice in substantially the form attached hereto and, if required by
the Indenture, an amount equal to accrued interest payable on such Note.
12 Ranking.
Payment of principal, premium, if any, interest on and Liquidated
Damages with respect to the Notes is subordinated, in the manner and to the
extent set forth in the Indenture, to the prior payment in full of all Senior
Indebtedness.
13 Repurchase at Option of Holder Upon a Change of Control.
If there is a Change of Control, the Company shall be required, subject
to the provisions of the Indenture, to offer to purchase on the Repurchase Date
all outstanding Notes at a purchase price equal to 100% of the principal amount
thereof, plus accrued and unpaid interest and Liquidated Damages, if any, to the
Repurchase Date. Holders of Notes will receive a Repurchase Offer from the
Company prior to any related Repurchase Date and may elect to have such Notes
purchased by completing the form entitled "Option of Holder to Elect Purchase"
appearing below.
14 Successors.
When a successor assumes all the obligations of its predecessor under
the Notes and the Indenture, the predecessor will be released from those
obligations.
15 Defaults and Remedies.
If an Event of Default occurs and is continuing (other than an Event of
Default relating to certain events of bankruptcy, insolvency or reorganization),
then in every such case, unless the principal of all of the Notes shall have
already become due and payable, either the Trustee or the Holders of 25% in
aggregate principal amount of Notes then outstanding may declare all the Notes
to be due and payable immediately in the manner and with the effect provided in
the Indenture. Holders of Notes may not enforce the Indenture or the Notes
except as provided in the Indenture. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Notes. Subject to
certain limitations, Holders of a majority in aggregate principal amount of the
Notes then outstanding may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Holders of Notes notice of any continuing
Default or Event of Default (except a Default in payment of principal, interest
or Liquidated Damages), if it determines that withholding notice is in their
interest.
16 Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any other
capacity, may make loans to, accept deposits from, and perform services for the
Company or its Affiliates, and may otherwise deal with the Company or its
Affiliates as if it were not the Trustee.
17 No Recourse Against Others.
No stockholder, director, officer or employee, as such, past, present
or future, of the Company or any successor corporation shall have any personal
liability in respect of the obligations of the Company under the Notes or the
Indenture by reason of his, her or its status as such stockholder, director,
officer or employee. Each Holder of a Note by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
18 Authentication.
This Note shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on this Note.
19 Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of a Note
or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by
the entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gifts to Minors
Act).
20 CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company will cause CUSIP numbers to be
printed on the Notes as a convenience to the Holders of the Notes. No
representation is made as to the accuracy of such numbers as printed on the
Notes and reliance may be placed only on the other identification numbers
printed hereon.
21 Additional Rights of Holders of Transfer Restricted Notes.
In addition to the rights provided to Holders of Notes under the
Indenture, Holders of Notes shall have all the rights set forth in the
Registration Rights Agreement.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement. Request
may be made to:
Fine Host Corporation
3 Greenwich Office Park
Greenwich, Connecticut 06831
Attention: Secretary
<PAGE>
[FORM OF ASSIGNMENT]
I or we assign this Note to
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee)
Please insert Social Note or other identifying number of assignee
_______________________
and irrevocably appoint______________________agent to transfer this Note on the
books of the Company. The agent may substitute another to act
for him.
Dated:______________________ Signed:__________________________________
(Sign exactly as your name appears on
the other side of this Note)
Signature Guaranty:___________________________
Signatures must be guarantied by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guaranty program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
<PAGE>
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Article XI of the Indenture, check the box:
If you want to elect to have only part of this Note purchased by the
Company pursuant to Article XI of the Indenture, state the amount you want to be
purchased: $
Date:______________________ Signature:_______________________________________
(Sign exactly as your name appears on
the other side of this Note)
Signature Guaranty:______________________________
Signatures must be guarantied by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guaranty program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
<PAGE>
SCHEDULE OF EXCHANGES OF DEFINITIVE NOTES3
The following exchanges of a part of this Global Note for Definitive
Notes have been made:
<PAGE>
Amount of Amount of Principal Amount Signature of
decrease in increase in of this Global authorized officer
Principal Amount Principal Amount Note following of Trustee or
Date of of this Global of this Global such decrease (or Notes
Exchange Note Note increase) Custodian
- -------- ---------------- ---------------- ----------------- ------------------
<PAGE>
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF NOTES
Re: 5% CONVERTIBLE SUBORDINATED NOTES DUE 2004 OF FINE HOST CORPORATION.
This Certificate relates to $____________ principal amount of Notes
held in * ____________ book-entry or * ____________ definitive form by
____________________________ (the "Transferor").
1. The Transferor:*
(a) has requested the Trustee by written order to deliver in exchange for
its beneficial interest in the Global Note held by the Depositary a Note or
Notes in definitive, registered form of authorized denominations and an
aggregate principal amount equal to its beneficial interest in such Global Note
(or the portion thereof indicated above); or
(b) has requested the Trustee by written order to exchange or register
the transfer of a Note or Notes.
2. In connection with any such request and in respect of each such
Note, the Transferor does hereby certify that Transferor is familiar with the
Indenture relating to the above-captioned Notes and as provided in Section 2.6
of such Indenture, the transfer of this Note does not require registration under
the Securities Act because:*
(a) Such Note is being acquired for the Transferor's own account, without
transfer (in satisfaction of Section 2.6(a)(ii)(A) or Section 2.6(d)(i)(A) of
the Indenture).
(b) Such Note is being transferred to a person who the Transferor
reasonably believes is a "qualified institutional buyer" (as defined in Rule
144A under the Securities Act) purchasing for its own account or for the account
of a qualified institutional buyer over which it exercises sole investment
discretion that is aware that the transfer is being made in reliance on Rule
144A (in satisfaction of Section 2.6(a)(ii)(B), Section 2.6(b)(i)(x) or Section
2.6(d)(i)(B) of the Indenture).
(c) Such Note is being transferred in accordance with Regulation S under
the Securities Act (in satisfaction of Section 2.6(a)(ii)(D), Section
2.6(b)(i)(y) or Section 2.6(d)(i)(D) of the Indenture). If requested by either
the Company or the Trustee, an Opinion of Counsel to the effect that such
transfer does not require registration under the Securities Act accompanies this
Certificate (in satisfaction of Section 2.6(a)(ii)(D) or Section 2.6(d)(i)(D) of
the Indenture).
(d) Such Note is being transferred to an institutional investor that is
an "accredited investor" within the meaning of Rule 501(a)(1),(2),(3) or (7)
under the Securities Act which delivers a certificate in the form of Exhibit B
to the Indenture to the Trustee (in satisfaction of Section 2.6(a)(ii)(C) or
Section 2.6(d)(i)(C) of the Indenture), and an opinion of counsel, if the
Company or the Trustee so requests.
(e) Such Note is being transferred in reliance on and in compliance with
another exemption from the registration requirements of the Securities Act. If
requested by either the Company or the Trustee, an Opinion of Counsel to the
effect that such transfer does not require registration under the Securities Act
accompanies this Certificate (in satisfaction of Section 2.6(a)(ii)(E) or
Section 2.6(d)(i)(E) of the Indenture).
__________________________________
[INSERT NAME OF TRANSFEROR]
By:_______________________________
Date:_________________________
3. Affiliation with the Company [check if applicable]
(a) The undersigned represents and warrants that it is, or at
some time during which it held this Note was, an Affiliate of
the Company.
(b) If 3(a) above is checked and if the undersigned was not an
Affiliate of the Company at all times during which it held
this Note, indicate the periods during which the undersigned
was an Affiliate of the Company:
____________________________________.
(c) If 3(a) above is checked and if the Transferee will not pay
the full purchase price for the transfer of this Note on or
prior to the date of transfer indicate when such purchase
price will be paid:
____________________________________.
<PAGE>
TO BE COMPLETED BY TRANSFEREE IF 2(b) ABOVE IS CHECKED AND THE TRANSFEROR IS NOT
A QUALIFIED INSTITUTIONAL BUYER:
The undersigned represents and warrants that it is a "qualified
institutional buyer" as defined in Rule 144A under the Securities Act of 1933,
as amended, and acknowledges that it has received such information regarding the
Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request such information.
Dated:________________________ _____________________________________
NOTICE: To be executed by an officer.
TO BE COMPLETED BY TRANSFEREE IF 2(c) ABOVE IS CHECKED:
The undersigned represents and warrants that it is not a "U.S. Person"
(as defined in Regulation S under the Securities Act of 1933, as amended).
Dated:________________________ _____________________________________
NOTICE: To be executed by an officer.
If none of the boxes under Section 2 of this certificate is checked or if any of
the above representations required to be made by the Transferee is not made, the
Registrar shall not be obligated to register this Note in the name of any person
other than the Holder hereof.
THE UNDERSIGNED HEREBY AGREES THAT, UNLESS THE BOX ABOVE UNDER ITEM 3(a) IS
CHECKED, THE UNDERSIGNED SHALL BE DEEMED TO HAVE REPRESENTED THAT IT IS NOT NOR
HAS IT BEEN AT ANY TIME DURING WHICH IT HELD THIS SECURITY AN AFFILIATE, AS
DEFINED IN RULE 144 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OF THE
COMPANY.
Dated:_______________________ _____________________________________
NOTICE: The signature of the Holder
to this assignment must
correspond with the name as
written upon the face of this
Note particular, without
alteration or enlargement or
any change whatsoever.
<PAGE>
B-2
EXHIBIT B
Accredited Investor Letter
Fine Host Corporation
c/o the Trustee
Ladies and Gentlemen:
This letter is delivered by the undersigned to request a transfer of
$_____________ principal amount of the 5% Convertible Subordinated Notes due
2004 (the "Notes") of Fine Host Corporation (the "Company"). The Notes are
described in that certain Offering Memorandum (the "Offering Memorandum") dated
October 21, 1997 relating to the offering of the Notes. We acknowledge receipt
of the Offering Memorandum and acknowledge that we have read the Offering
Memorandum, have had access to such financial and other information and have
been afforded the opportunity to ask such questions of representatives of the
Company and receive answers thereto, as we deem necessary in connection with our
decision to purchase the Notes.
Upon transfer the Notes would be registered in the name of the
undersigned:
Name:________________________________________________
Address:_____________________________________________
Taxpayer ID Number:__________________________________
The undersigned represents and warrants to you that:
1. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the
"Securities Act")), purchasing for our own account or for the account of such an
institutional "accredited investor," and we are acquiring the Notes for
investment purposes and not with a view to, or for offer or sale in connection
with, any distribution in violation of the Securities Act and we have such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risk of our investment in the Notes and invest in or
purchase securities similar to the Notes in the normal course of our business,
and we, and any account for which we are acting, are each able to bear the
economic risk of our or its investment. We confirm that neither the Company nor
any person acting on its behalf has offered to sell the Notes by, and that we
have not been made aware of the offering of the Notes by, any form of general
solicitation or general advertising, including, but not limited to, any
advertisement, article, notice or other communication published in any
newspaper, magazine or similar media or broadcast over television or radio.
2. We understand that the Notes and the Common Stock issuable upon
conversion of the Notes (the Notes and such Common Stock are collectively
referred to herein as the "Restricted Securities") have not been registered
under the Securities Act, or any state securities laws, and, unless so
registered, may not be sold except as permitted in the following sentence. We
agree on our own behalf and on behalf of any investor account for which we are
purchasing Notes that such Restricted Securities are "restricted securities"
within the meaning of Rule 144 under the Securities Act and to offer, sell or
otherwise transfer such Restricted Securities prior to the date which is two
years after the date of original issue (the "Resale Restriction Termination
Date") only (a) to the Company or any of its subsidiaries, (b) so long as the
Restricted Securities are eligible for resale pursuant to Rule 144A under the
Securities Act, to a person we reasonably believe is a qualified institutional
buyer under Rule 144A under the Securities Act (a "QIB") that purchases for its
own account or for the account of a QIB and to whom notice is given that the
transfer is being made in reliance on Rule 144A, (c) to an institutional
"accredited investor," within the meaning of Rule 501(a)(1), (2), (3) or (7)
under the Securities Act, that is purchasing for its own account or for the
account of an institutional "accredited investor," (d) pursuant to offers and
sales that occur outside the United States within the meaning of Regulation S
under the Securities Act, (e) in a transaction meeting the requirements of Rule
144 under the Securities Act, (f) pursuant to any other available exemption from
the registration requirements of the Securities Act, or (g) pursuant to a
registration statement that has been declared effective under the Securities
Act, subject in each of the foregoing cases to any requirement of law that the
disposition of our property or the property of such investor account or accounts
be at all times within our or their control and in compliance with any
applicable state securities laws. The foregoing restrictions on resale will not
apply subsequent to the Resale Restriction Termination Date. If any resale or
other transfer of the Restricted Securities is proposed to be made pursuant to
clause (c) above prior to the Resale Restriction Termination Date, the
transferor shall deliver a letter from the transferee substantially in the form
of this letter to the Company and the trustee (the "Trustee") under the
indenture, dated as of October 27, 1997 between the Company and the Trustee
relating to the Notes, which shall provide, among other things, that the
transferee is an institutional "accredited investor" within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act and that it is acquiring
such Restricted Securities for investment purposes and not for distribution in
violation of the Securities Act. Each purchaser acknowledges that the Company
and the Trustee reserve the right prior to any offer, sale or other transfer,
prior to the Resale Restriction Termination Date, of the Restricted Securities
pursuant to clause (c), (d) or (f) above to require the delivery of an opinion
of counsel, certifications and/or other information satisfactory to the Company
and the Trustee.
3. We understand that the Notes will be in the form of definitive
physical certificates bearing the legend set forth in clause (5) in the "Notice
to Investors" section of the Offering Memorandum.
We acknowledge that you, the Initial Purchasers and others will rely
upon our confirmations, acknowledgments and agreements set forth herein, and we
agree to notify you promptly in writing if any of our representations and
warranties herein ceases to be accurate and complete.
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES
THEREOF.
___________________________
By:________________________
<PAGE>
EXHIBIT C
FORM OF CONVERSION NOTICE
TO: Fine Host Corporation
The undersigned owner of this Note hereby: (i) irrevocably exercises
the option to convert this Note, or the portion hereof below designated, for
shares of Common Stock of Fine Host Corporation in accordance with the terms of
the Indenture referred to in this Note and (ii) directs that such shares of
Common Stock deliverable upon the conversion, together with any check in payment
for fractional shares and any Note(s) representing any unconverted principal
amount hereof, be issued and delivered to the registered holder hereof unless a
different name has been indicated below. If shares are to be delivered
registered in the name of a person other than the undersigned, the undersigned
will pay all transfer taxes payable with respect thereto. Any amount required to
be paid by the undersigned on account of interest accompanies this Note.
Dated:_________________________
____________________________________________
Signature
Fill in for registration of shares if to be delivered, and of Notes if
to be issued, otherwise than to and in the name of the registered holder.
____________________________________________
Social Security or other
Taxpayer Identifying Number
_______________________________
(Name)
______________________________
(Street Address)
______________________________
City, State and Zip Code)
(Please print name and address)
Principal amount to be converted
(if less than all)
$___________________________________________
<PAGE>
FINE HOST CORPORATION
as the Issuer
and
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
NATIONSBANC MONTGOMERY SECURITIES, INC.
SMITH BARNEY INC.
and
PIPER JAFFRAY INC.
as Purchasers
<PAGE>
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement is made and entered into as of
October 27, 1997, by and among Fine Host Corporation, a Delaware corporation
(the "Company"), and Donaldson, Lufkin & Jenrette Securities Corporation,
NationsBanc Montgomery Securities, Inc., Smith Barney Inc. and Piper Jaffray
Inc. (the "Purchasers").
This Agreement is made pursuant to the Purchase Agreement, dated
October 21, 1997, among the Company and the Purchasers (the "Purchase
Agreement"). In order to induce the Purchasers to enter into the Purchase
Agreement, the Company has agreed to provide the registration rights provided
for in this Agreement to the Purchasers and their respective direct and indirect
transferees. The execution of this Agreement is a condition to the closing of
the transactions contemplated by the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions
As used in this Agreement, the following terms shall have the
following meanings:
Affiliate: of any specified person shall mean any other person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified person. For the purposes of this definition,
"control," when used with respect to any person, means the power to direct the
management and policies of such person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise, and the terms
"affiliated," "controlling" and "controlled" have meanings correlative to the
foregoing.
Agreement: This Registration Rights Agreement, as the same may be
amended, supplemented or modified from time to time in accordance with the terms
hereof.
Business Day: Each Monday, Tuesday, Wednesday, Thursday and Friday that
is not a day on which banking institutions in New York, New York are authorized
or obligated by law or executive order to close.
Closing Date: The Closing Date as defined in the Purchase Agreement.
Common Stock: Common Stock, $.01 par value per share, of the Company.
Company: Fine Host Corporation, a Delaware corporation, and any
successor corporation thereto.
controlling person: As defined in Section 6(a) hereof.
Damage Payment Date: Each of the semi-annual interest payment dates
provided in the Indenture.
Effectiveness Period: As defined in Section 2(a) hereof.
Effectiveness Target Date: The 180th day following the Closing Date.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated by the SEC thereunder.
Filing Date: The 90th day after the Closing Date.
Holder: Each registered holder of any Transfer Restricted Securities.
Indemnified Person: As defined in Section 6(a) hereof.
Indenture: The Indenture, dated as of the date hereof, between the
Company and the Trustee thereunder, pursuant to which the Notes are being
issued, as amended, modified or supplemented from time to time in accordance
with the terms thereof.
Liquidated Damages: As defined in Section 3(a) hereof.
Notes: The 5% Convertible Subordinated Notes due 2004 of the Company
issued pursuant to the Indenture (including any such Notes issued pursuant to
the exercise of the over-allotment option provided in the Purchase Agreement).
Proceeding: An action, claim, suit or proceeding (including, without
limitation, an investigation or partial proceeding, such as a deposition),
whether commenced or threatened.
Prospectus: The prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated pursuant to the Securities
Act), as amended or supplemented by any prospectus supplement, with respect to
the terms of the offering of any portion of the Transfer Restricted Securities
covered by such Registration Statement, and all other amendments and supplements
to any such prospectus, including post effective amendments, and all material
incorporated by reference or deemed to be incorporated by reference, if any, in
such prospectus.
Purchasers: As defined in the preamble hereof.
Registration Default: As defined in Section 3(a) hereof.
Registration Statement: Any registration statement of the Company that
covers any of the Transfer Restricted Securities pursuant to the provisions of
this Agreement, including the Prospectus, amendments and supplements to such
registration statement or Prospectus, including pre- and post-effective
amendments, all exhibits thereto, and all material incorporated by reference or
deemed to be incorporated by reference, if any, in such registration statement.
Rule 144: Rule 144 promulgated by the SEC pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
Rule 144A: Rule 144A promulgated by the SEC pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
Rule 158: Rule 158 promulgated by the SEC pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
Rule 174: Rule 174 promulgated by the SEC pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
Rule 415: Rule 415 promulgated by the SEC pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
Rule 424: Rule 424 promulgated by the SEC pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
SEC: The Securities and Exchange Commission. Securities Act: The
Securities Act of 1933, as amended, and the rules and regulations promulgated by
the SEC thereunder.
Shelf Registration: As defined in Section 2 hereof.
Special Counsel: Any special counsel to the holders of Transfer
Restricted Securities, for which holders of Transfer Restricted Securities will
be reimbursed pursuant to Section 5(b) hereof.
TIA: The Trust Indenture Act of 1939, as amended.
Transfer Restricted Securities: The Notes and the shares of Common
Stock into which the Notes are convertible, upon original issuance thereof, and
at all times subsequent thereto, until, in the case of any such Note or share,
(i) the date on which it has been registered effectively pursuant to the
Securities Act and disposed of in accordance with the Registration Statement
relating to it, (ii) the date on which either such Note or the shares of Common
Stock issued upon conversion of such Note are distributed to the public pursuant
to Rule 144 or are saleable pursuant to Rule 144(k) or (iii) the date on which
it ceases to be outstanding.
Trustee: The Bank of New York, as trustee under the Indenture.
underwritten registration or underwritten offering: A registration in
connection with which securities of the Company are sold to an underwriter for
reoffering to the public pursuant to an effective Registration Statement.
2. Shelf Registration
(a) The Company agrees to file with the SEC as soon as practicable
after the Closing Date, but in no event later than the Filing Date, a
Registration Statement for an offering to be made on a continuous basis pursuant
to Rule 415 covering all of the Transfer Restricted Securities (the "Shelf
Registration"). The Shelf Registration shall be on Form S-3 under the Securities
Act or another appropriate form permitting registration of such Transfer
Restricted Securities for resale by the Holders in the manner or manners
reasonably designated by them (including, without limitation, one or more
underwritten offerings). The Company shall use all reasonable efforts, as
described in Section 4, to cause the Shelf Registration to be declared effective
pursuant to the Securities Act as promptly as practicable following the filing
thereof, but in no event later than the Effectiveness Target Date, and to keep
the Shelf Registration continuously effective under the Securities Act for 24
months after the latest date of initial issuance of the Notes (the
"Effectiveness Period"), or such shorter period ending when either (1) all
Transfer Restricted Securities covered by the Shelf Registration have been sold
in the manner set forth and as contemplated in the Shelf Registration or (2)
there cease to be outstanding any Transfer Restricted Securities.
(b) The Company shall use all reasonable efforts to keep the Shelf
Registration continuously effective, for the period described in Section 2(a)
hereof, by supplementing and amending the Shelf Registration if required by the
rules, regulations or instructions applicable to the registration form used for
such Shelf Registration, if required by the Securities Act or if reasonably
requested by the holders of a majority in amount of the Transfer Restricted
Securities (determined on a fully converted basis) covered by such Registration
Statement or by any underwriter of such Transfer Restricted Securities (except
to the extent any such amendment or supplement requested by such holders or
underwriter would, in the reasonable judgment of the Company (based on advice of
counsel) make the statements therein misleading).
(c) Notwithstanding anything to the contrary in this Section 2, but
subject to compliance with Section 3, the Company may, by delivering written
notice to the Holders, prohibit offers and sales of Transfer Restricted
Securities pursuant to the Shelf Registration at any time if (A)(i) the Company
is in possession of material non public information relating to the Company,
(ii) the Company determines (based on advice of counsel) that such prohibition
is necessary in order to avoid a requirement to disclose such material non
public information to the public and (iii) the Company determines in good faith
that public disclosure of such material non public information would not be in
the best interests of the Company and its stockholders or (B)(i) the Company has
made a public announcement relating to an acquisition or business combination
transaction including the Company and/or one or more of its subsidiaries that is
material to the Company and its subsidiaries taken as a whole and (ii) the
Company determines in good faith that (x) offers and sales of Transfer
Restricted Securities pursuant to the Shelf Registration prior to the
consummation of such transaction (or such earlier date as the Company shall
determine) is not in the best interests of the Company and its stockholders or
(y) it would be impracticable at the time to obtain any financial statements
relating to such acquisition or business combination transaction that would be
required to be set forth in the Shelf Registration; provided, however, that upon
(i) the public disclosure by the Company of the material non public information
described in clause (A) of this paragraph or (ii) the consummation, abandonment
or termination of, or the availability of the required financial statements with
respect to, a transaction described in clause (B) of this paragraph, the
suspension of the use of the Shelf Registration pursuant to this Section 2(c)
shall cease and the Company shall promptly comply with Section 4(b) hereof and
notify Holders that dispositions of Transfer Restricted Securities may be
resumed.
3. Liquidated Damages
(a) The Company and the Purchasers agree that the Holders of Transfer
Restricted Securities will suffer damages if the Company fails to fulfill its
obligations pursuant to Sections 2 and 4(b) hereof and that it would not be
possible to ascertain the extent of such damages. Accordingly, in the event of
such failure by the Company to fulfill such obligations, the Company hereby
agrees to pay liquidated damages ("Liquidated Damages") to each Holder of
Transfer Restricted Securities under the circumstances and to the extent set
forth below.
If (i) the Shelf Registration has not been filed with the SEC on or
prior to the Filing Date; or (ii) the Shelf Registration is not declared
effective by the SEC on or prior to the Effectiveness Target Date; or (iii) the
Shelf Registration has been declared effective by the SEC and such Shelf
Registration ceases to be effective or the Prospectus contained therein ceases
to be usable (including as a result of a prohibition against sales of Transfer
Restricted Securities pursuant to Section 2(c) hereof or a suspension of the use
of the Prospectus as described in the last paragraph of Section 4 hereof) at any
time during the Effectiveness Period for a period of time which shall exceed 90
days in the aggregate during any 365-day period (each such event referred to in
clauses (i), (ii) and (iii), a "Registration Default"), then the Company shall
pay Liquidated Damages in cash to each Holder of Transfer Restricted Securities
following the occurrence of such Registration Default in an amount equal to $.05
per week per $1,000 principal amount of Notes or, if applicable, $.0022 per week
per share (subject to adjustment in the event of stock splits, stock
recombinations, stock dividends and the like) of Common Stock constituting
Transfer Restricted Securities held by such Holder for each week or portion
thereof that the Registration Default continues. The amount of such Liquidated
Damages will increase by an additional $.05 per week per $1,000 principal amount
of Notes or, if applicable, $.0022 per week per share (subject to adjustment as
set forth above) of Common Stock constituting Transfer Restricted Securities for
each subsequent 90 day period until all Registration Defaults have been cured;
provided, however, that Liquidated Damages shall not at any time exceed $.25 per
week per $1,000 principal amount of Notes or $.0111 per week per share (subject
to adjustment as set forth above) of Common Stock constituting Transfer
Restricted Securities. Such Liquidated Damages shall be the sole remedy
available to Holders of such Transfer Restricted Securities with respect to a
Registration Default. Following the cure of all Registration Defaults relating
to any Transfer Restricted Securities, the accrual of Liquidated Damages with
respect to such Transfer Restricted Securities will cease. A Registration
Default under clause (i) above shall be cured on the date that the Shelf
Registration is filed with the SEC; a Registration Default under clause (ii)
above shall be cured on the date that the Shelf Registration is declared
effective by the SEC; and a Registration Default under clause (iii) above shall
be cured on the date the Shelf Registration is declared effective or the
Prospectus contained therein again becomes usable.
(b) The Company shall notify the Trustee within one Business Day after
each and every date on which a Registration Default first occurs. Liquidated
Damages shall be paid on each Payment Date by the Company to the Holders of
Transfer Restricted Securities as of the immediately preceding Record Date (as
defined in the Indenture) in the same manner interest is paid to Holders of
Notes pursuant to the Indenture. Each obligation to pay Liquidated Damages shall
be deemed to commence accruing on the date of the applicable Registration
Default and to cease accruing when all Registration Defaults have been cured. In
no event shall the Company pay Liquidated Damages in excess of the applicable
maximum weekly amount set forth above, regardless of whether one or multiple
Registration Defaults exist (e.g., subject to increase as set forth above for
each subsequent 90-day period, Liquidated Damages shall equal $.05 per week per
$1,000 principal amount of Notes during the first 90-day period immediately
following the occurrence of the first Registration Default regardless of whether
additional Registration Defaults occur during such 90 day period).
4. Registration Procedures
In connection with the Company's registration obligations hereunder,
the Company shall effect such registrations on the appropriate form available
for the sale of the Transfer Restricted Securities to permit the sale of
Transfer Restricted Securities in accordance with the method or methods of
disposition thereof specified by the holders of a majority in amount of Transfer
Restricted Securities (determined on a fully converted basis), and pursuant
thereto the Company shall as expeditiously as possible:
(a) No fewer than five Business Days prior to the initial filing of a
Registration Statement or Prospectus and no fewer than two Business Days prior
to the filing of any amendment or supplement thereto (other than any document
that would be incorporated or deemed to be incorporated therein by reference),
furnish to the Holders of the Transfer Restricted Securities, their Special
Counsel and the managing underwriters, if any, copies of all such documents
proposed to be filed, which documents (other than those incorporated or deemed
to be incorporated by reference) will be subject to the review of such Holders,
their Special Counsel and such underwriters, if any, during the five Business
Day period or two Business Day period, respectively, and cause the officers and
directors of the Company, counsel to the Company and independent certified
public accountants to the Company to respond to such inquiries as shall be
necessary in connection with such Registration Statement, in the opinion of
respective counsel to such Holders and such underwriters, to conduct a
reasonable investigation within the meaning of the Securities Act. The Company
shall not file any such Registration Statement or related Prospectus or any
amendments or supplements thereto (other than any document that would be
incorporated or deemed to be incorporated in the Registration Statement by
reference) to which the Holders of a majority of the Transfer Restricted
Securities (determined on a fully converted basis), their Special Counsel, or
the managing underwriters, if any, shall reasonably object on a timely basis;
provided, that the Company may assume, for the purposes of this subparagraph
(a), that objections to the inclusion of information specifically requested to
be included in the Registration Statement by the staff of the SEC, or in the
opinion of counsel to the Company required to be in the Registration Statement,
or specifically required by the Securities Act or other applicable law, shall
not be deemed to be reasonable;
(b) Use its best efforts to prepare and file with the SEC such
amendments, including post-effective amendments, to each Registration Statement
as may be necessary to keep such Registration Statement continuously effective
for the applicable time period; cause, subject to Section 2(c) hereof, the
related Prospectus to be supplemented by any required Prospectus supplement, and
as so supplemented to be filed pursuant to Rule 424; and comply in all material
respects with the provisions of the Securities Act and the Exchange Act with
respect to the disposition of all securities covered by such Registration
Statement during such period in accordance with the intended methods of
disposition by the sellers thereof set forth in such Registration Statement as
so amended or in such Prospectus as so supplemented;
(c) Notify the Holders of Transfer Restricted Securities to be sold (to
the extent known by the Company) or their Special Counsel and the managing
underwriters, if any, promptly (and in the case of an event specified by clause
(i)(A) of this paragraph, in no event fewer than two Business Days prior to such
filing), and (if requested by any such person) confirm such notice in writing,
(i)(A) when a Prospectus or any Prospectus supplement or post-effective
amendment is proposed to be filed, and (B) with respect to a Registration
Statement or any post-effective amendment, when the same has become effective,
(ii) of any request by the SEC or any other Federal or state governmental
authority for amendments or supplements to a Registration Statement or
Prospectus or for additional information, (iii) of the issuance by the SEC, any
state securities commission, any other governmental agency or any court of any
stop order, order or injunction suspending or enjoining the use or the
effectiveness of a Registration Statement or the initiation of any Proceeding
for that purpose, (iv) if at any time any of the representations and warranties
of the Company contained in any agreement (including any underwriting agreement)
contemplated by Section 4(m) hereof cease to be true and correct in all material
respects, (v) of the receipt by the Company of any notification with respect to
the suspension of the qualification or exemption from qualification of any of
the Transfer Restricted Securities for sale in any jurisdiction, or the
initiation or threatening, in each case in writing, of any Proceeding for such
purpose, and (vi) of the happening of any event that requires the making of any
changes in such Registration Statement, Prospectus or documents incorporated or
deemed to be incorporated therein by reference so that, in the case of the
Registration Statement, it will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, not misleading, and that, in the case
of the Prospectus, it will not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading;
(d) Use all reasonable best efforts to avoid the issuance of, or, if
issued, obtain the withdrawal of any order enjoining or suspending the use or
effectiveness of a Registration Statement or the lifting of any suspension of
the qualification (or exemption from qualification) of any of the Transfer
Restricted Securities for sale in any jurisdiction, at the earliest practicable
moment;
(e) If requested by the managing underwriters, if any, or the Holders
of a majority in amount of the Transfer Restricted Securities (determined on a
fully converted basis) being sold in connection with such offering, (i) promptly
incorporate in a Prospectus supplement or post-effective amendment such
information as the managing underwriters, if any, and such Holders agree should
be included therein relating to the terms of the sale of the Transfer Restricted
Securities of such Holder in the Prospectus, and (ii) make all required filings
of such Prospectus supplement or such post-effective amendment as soon as
practicable after the Company has received notification of the matters to be
incorporated in such Prospectus supplement or post-effective amendment;
provided, however, that the Company shall not be required to take any action
pursuant to this Section 4(e) that would, in the opinion of counsel for the
Company, violate applicable law;
(f) Furnish to each Holder of Transfer Restricted Securities so
requesting in writing, their Special Counsel and each managing underwriter, if
any, without charge, at least one conformed copy of each Registration Statement
and each amendment thereto, including financial statements (but excluding
schedules, all documents incorporated or deemed to be incorporated therein by
reference and all exhibits, unless requested in writing by such Holder, counsel
or managing underwriter);
(g) Deliver to each Holder of Transfer Restricted Securities, their
Special Counsel, and the underwriters, if any, without charge, as many copies of
the Prospectus or Prospectuses (including each form of prospectus) and each
amendment or supplement thereto as such persons reasonably request; and the
Company hereby consents to the use of such Prospectus and each amendment or
supplement thereto by each of the selling Holders of Transfer Restricted
Securities and the underwriters, if any, in connection with the offering and
sale of the Transfer Restricted Securities covered by such Prospectus and any
amendment or supplement thereto;
(h) Prior to any public offering of Transfer Restricted Securities, use
all reasonable efforts to register or qualify or cooperate with the Holders of
Transfer Restricted Securities to be sold, the underwriters, if any, and their
respective counsel in connection with the registration or qualification (or
exemption from such registration or qualification) of such Transfer Restricted
Securities for offer and sale under the securities or Blue Sky laws of such
jurisdictions within the United States as any Holder or underwriter reasonably
requests in writing; use all reasonable efforts to keep each such registration
or qualification (or exemption therefrom) effective during the period such
Registration Statement is required to be kept effective and use all reasonable
efforts to do any and all other acts or things necessary or advisable to enable
the disposition in such jurisdictions of the Transfer Restricted Securities
covered by the Registration Statement; provided, however, that the Company shall
not be required to qualify generally to do business in any jurisdiction where it
is not then so qualified or to take any action that would subject it to general
service of process in any such jurisdiction where it is not then so subject or
subject the Company to any tax in any such jurisdiction where it is not then so
subject;
(i) In connection with any sale or transfer of Transfer Restricted
Securities that will result in such securities no longer being Transfer
Restricted Securities, cooperate with the Holders and the managing underwriters,
if any, to facilitate the timely preparation and delivery of certificates
representing Transfer Restricted Securities to be sold, which certificates shall
not bear any restrictive legends and shall be in a form eligible for deposit
with The Depository Trust Company and to enable such Transfer Restricted
Securities to be in such denominations and registered in such names as the
managing underwriters, if any, or Holders may request at least two Business Days
prior to any sale of Transfer Restricted Securities;
(j) Use all reasonable efforts to cause the offering of the Transfer
Restricted Securities covered by the Registration Statement to be registered
with or approved by such other governmental agencies or authorities within the
United States as may require such registration or approval, except as may be
required as a consequence of the nature of such selling Holder's business, in
which case the Company will cooperate in all reasonable respects with the filing
of such Registration Statement and the granting of such approvals as may be
necessary to enable the seller or sellers thereof or the underwriters, if any,
to consummate the disposition of such Transfer Restricted Securities; provided,
however, that the Company shall not be required to register the Transfer
Restricted Securities in any jurisdiction that would subject it to general
service of process in any such jurisdiction where it is not then so subject or
subject the Company to any tax in any such jurisdiction where it is not then so
subject or to require the Company to qualify to do business in any jurisdiction
where it is not then so qualified;
(k) Upon the occurrence of any event contemplated by Section 4(c)(vi)
hereof, as promptly as practicable, prepare a supplement or amendment,
including, if appropriate, a post-effective amendment, to each Registration
Statement or a supplement to the related Prospectus or any document incorporated
or deemed to be incorporated therein by reference, and file any other required
document so that, as thereafter delivered, such Prospectus will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(l) Prior to the effective date of the first Registration Statement
relating to the Transfer Restricted Securities, to provide a CUSIP number for
the Transfer Restricted Securities;
(m) Enter into such agreements (including an underwriting agreement in
form, scope and substance as is customary in underwritten offerings) and take
all such other reasonable actions in connection therewith (including those
reasonably requested by the managing underwriters, if any, or the Holders of a
majority in amount of the Transfer Restricted Securities being sold (determined
on a fully converted basis)) in order to expedite or facilitate the disposition
of such Transfer Restricted Securities, and, in such connection, if an
underwriting agreement is entered into (i) make such representations and
warranties to the underwriters with respect to the business of the Company and
its subsidiaries (including with respect to businesses or assets acquired or to
be acquired by any of them), and the Registration Statement, Prospectus and
documents, if any, incorporated or deemed to be incorporated by reference
therein, in each case, in form, substance and scope as are customarily made by
issuers to underwriters in underwritten offerings, and confirm the same if and
when requested; (ii) use all reasonable efforts to obtain opinions of counsel to
the Company and updates thereof (which counsel and opinions (in form, scope and
substance) shall be reasonably satisfactory to the managing underwriters, if
any), addressed to each of the underwriters, covering the matters customarily
covered in opinions requested in underwritten offerings and such other matters
as may be reasonably requested by the underwriters; (iii) use all reasonable
efforts to obtain customary "cold comfort" letters and updates thereof from the
independent certified public accountants of the Company (and, if necessary, any
other independent certified public accountants of any subsidiary of the Company
or of any business acquired by the Company for which financial statements and
financial data is, or is required to be, included in the Registration
Statement), addressed (where reasonably possible) to each selling Holder of
Transfer Restricted Securities and each of the underwriters, such letters to be
in customary form and covering matters of the type customarily covered in "cold
comfort" letters in connection with underwritten offerings; (iv) the
underwriting agreement shall contain indemnification provisions and procedures
no less favorable to the selling Holders of Transfer Restricted Securities and
the underwriters than those set forth in Section 6 hereof (or such other
provisions and procedures acceptable to Holders of a majority in amount of the
Transfer Restricted Securities (determined on a fully converted basis) covered
by such Registration Statement and the managing underwriters); and (v) deliver
such documents and certificates as may be reasonably requested by the managing
underwriters, if any, to evidence the continued validity of the representations
and warranties made pursuant to clause (i) of this Section 4(m) and to evidence
compliance with any customary conditions contained in the underwriting
agreement;
(n) Make available for inspection by a representative of the Holders of
not less than 50% of the Transfer Restricted Securities (determined on a fully
converted basis) being sold (to the extent reasonably practicable), any
underwriter participating in any such disposition of Transfer Restricted
Securities, if any, and any Special Counsel, consultant or accountant retained
by such selling Holders or underwriter, at the offices where normally kept,
during reasonable business hours, all financial and other records, pertinent
corporate documents and properties of the Company and its subsidiaries as they
may reasonably request, and cause the officers, directors, agents and employees
of the Company and its subsidiaries to supply all information in each case
reasonably requested by any such representative, underwriter, attorney,
consultant or accountant in connection with such Registration Statement,
provided, however, that such persons shall first agree in writing with the
Company that any information that is reasonably and in good faith designated by
the Company in writing as confidential at the time of delivery of such
information shall be kept confidential by such persons, unless (i) disclosure of
such information is required by court or administrative order or is necessary to
respond to inquiries of regulatory authorities, (ii) disclosure of such
information is required by law (including any disclosure requirements pursuant
to Federal securities laws in connection with the filing of any Registration
Statement or the use of any Prospectus referred to in this Agreement), (iii)
such information becomes generally available to the public other than as a
result of a disclosure or failure to safeguard by any such person or (iv) such
information becomes available to any such person from a source other than the
Company and such source is not bound by a confidentiality agreement;
(o) Cause the Indenture to be qualified under the TIA not later than
the effective date of the first Registration Statement relating to the Transfer
Restricted Securities; and in connection therewith, cooperate with the trustee
under the Indenture and the holders of the Transfer Restricted Securities to
effect such changes to the Indenture as may be required for such Indenture to be
so qualified in accordance with the terms of the TIA; and execute, and use its
reasonable best efforts to cause such trustee to execute, all customary
documents as may be required to effect such changes, and all other forms and
documents required to be filed with the SEC to enable the Indenture to be so
qualified in a timely manner; and
(p) Comply with applicable rules and regulations of the SEC and make
generally available to its security holders earning statements satisfying the
provisions of Section 11(a) of the Securities Act and Rule 158, no later than 45
days after the end of any 12-month period (or 90 days after the end of any
12-month period if such period is a fiscal year) (i) commencing at the end of
any fiscal quarter in which Transfer Restricted Securities are sold to
underwriters in a firm commitment or reasonable efforts underwritten offering
and (ii) if not sold to underwriters in such an offering, commencing on the
first day of the first fiscal quarter after the effective date of a Registration
Statement, which statement shall cover said period, consistent with the
requirements of Rule 158.
The Company may require each seller of Transfer Restricted Securities
as to which any registration is being effected to furnish to the Company such
information regarding the distribution of such Transfer Restricted Securities as
is required by law to be disclosed in the applicable Registration Statement and
the Company may exclude from such registration the Transfer Restricted
Securities of any seller who unreasonably fails to furnish such information
within a reasonable time after receiving such request. Each such Holder agrees,
by the acquisition of Transfer Restricted Securities, and agrees to confirm such
agreement in writing upon request of the Company, to notify the Company as
promptly as practicable of any inaccuracy or change in information previously
furnished by such Holder to the Company or of the occurrence of any event as a
result of which any Prospectus relating to such registration contains or would
contain an untrue statement of a material fact regarding such Holder or such
Holder's intended method of distribution of such Transfer Restricted Securities,
or omits to state any material fact regarding such Holder or such Holder's
intended method of distribution of such Transfer Restricted Securities,
necessary to make the statements therein, in light of the circumstances then
existing, not misleading and promptly to furnish to the Company any additional
information required to correct and update any previously furnished information
or required so that such Prospectus shall not contain, with respect to such
Holder or the distribution of such Transfer Restricted Securities, an untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances then existing, not
misleading.
If any such Registration Statement refers to any Holder by name or
otherwise as the holder of any securities of the Company, then such Holder shall
have the right to require (i) the insertion therein of language, in form and
substance reasonably satisfactory to such Holder, to the effect that the holding
by such Holder of such securities is not to be construed as a recommendation by
such Holder of the investment quality of the Company's securities covered
thereby and that such holding does not imply that such Holder will assist in
meeting any future financial requirements of the Company, or (ii) in the event
that such reference to such Holder by name or otherwise is not required by the
Securities Act or any similar Federal statute then in force, the deletion of the
reference to such Holder in any amendment or supplement to the Registration
Statement filed or prepared subsequent to the time that such reference ceases to
be required.
Each Holder of Transfer Restricted Securities agrees by acquisition of
such Transfer Restricted Securities that, upon receipt of any notice from the
Company pursuant to Section 2(c) hereof or of the happening of any event of the
kind described in Section 4(c)(ii), 4(c)(iii), 4(c)(v) or 4(c)(vi) hereof, such
Holder will forthwith discontinue disposition of such Transfer Restricted
Securities covered by such Registration Statement or Prospectus until such
Holder's receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 4(k) hereof, or until it is advised in writing by the
Company that the use of the applicable Prospectus may be resumed, and, in either
case, has received copies of any additional or supplemental filings that are
incorporated or deemed to be incorporated by reference in such Prospectus, and,
if so directed by the Company, such Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies, then in such
Holder's possession of the Prospectus covering such Transfer Restricted
Securities at the time of receipt of such notice.
5. Registration Expenses
(a) All fees and expenses incident to the performance of or compliance
with this Agreement by the Company shall be borne by it whether or not any
Registration Statement is filed or becomes effective and whether or not any
securities are issued or sold pursuant to any Registration Statement. The fees
and expenses referred to in the foregoing sentence shall include, without
limitation, (i) all registration and filing fees (including, without limitation,
fees and expenses (A) with respect to filings required to be made with the
National Association of Securities Dealers, Inc. and (B) in compliance with
securities or Blue Sky laws (including, without limitation and in addition to
that provided for in (b) below, fees and disbursements of counsel for the
underwriters or Special Counsel for the Holders in connection with Blue Sky
qualifications of the Transfer Restricted Securities and determination of the
eligibility of the Transfer Restricted Securities for investment under the laws
of such jurisdictions as the managing underwriters, if any, or Holders of a
majority in amount (determined on a fully converted basis) of Transfer
Restricted Securities may designate)), (ii) printing expenses (including,
without limitation, expenses of printing certificates for Transfer Restricted
Securities in a form eligible for deposit with The Depository Trust Company and
of printing Prospectuses if the printing of Prospectuses is requested by the
managing underwriters, if any), (iii) messenger, telephone and delivery
expenses, (iv) fees and disbursements of counsel for the Company and one Special
Counsel for the Holders (plus any local counsel deemed appropriate by the
Holders of a majority in amount of the Transfer Restricted Securities
(determined on a fully converted basis)), in accordance with the provisions of
Section 5(b) hereof, (v) fees and disbursements of all independent certified
public accountants referred to in Section 4(m)(iii) hereof (including, without
limitation, the expenses of any special audit and cold comfort" letters required
by or incident to such performance), (vi) Securities Act liability insurance, if
the Company so desires such insurance, and (vii) fees and expenses of all other
persons retained by the Company. In addition, the Company shall pay its internal
expenses (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expense of
any annual audit, and the fees and expenses incurred in connection with the
listing of the securities to be registered on any securities exchange or on
NASDAQ. Notwithstanding the foregoing or anything in this Agreement to the
contrary, each Holder of the Transfer Restricted Securities being registered
shall pay all commissions, placement agent fees and underwriting discounts and
commissions with respect to any Transfer Restricted Securities sold by it and
the fees and disbursements of any counsel or other advisors or experts retained
by such Holders (severally or jointly), other than Special Counsel and local
counsel referred to in clause (iv) above.
(b) In connection with any registration hereunder, the Company shall
reimburse the Holders of the Transfer Restricted Securities being registered in
such registration for the reasonable fees and disbursements of not more than one
firm of attorneys representing the selling Holders to be designated as Special
Counsel (in addition to any local counsel), which firm shall be chosen by the
Holders of a majority in amount of the Transfer Restricted Securities
(determined on a fully converted basis).
6. Indemnification
(a) The Company agrees to indemnify and hold harmless (i) each of the
Purchasers, (ii) each Holder of Transfer Restricted Securities, (iii) each
person, if any, who controls (within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act) any of the foregoing (any of the persons
referred to in this clause (iii) being hereinafter referred to as a "controlling
person"), and (iv) the respective officers, directors, partners, employees,
representatives and agents of the Purchasers, each Holder of Transfer Restricted
Securities, or any controlling person (any person referred to in clause (i),
(ii), (iii) or (iv) may hereinafter be referred to as an "Indemnified Person"),
from and against any and all losses, claims, damages, liabilities and judgments
caused by any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement, Prospectus or form of Prospectus or in
any amendment or supplement thereto or in any preliminary Prospectus, or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein (in the case of
any Prospectus or form of Prospectus or supplement thereto, in light of the
circumstances under which they were made) not misleading, except insofar as such
losses, claims, damages, liabilities or judgments are caused by any such untrue
statement or omission or alleged untrue statement or omission based upon
information relating to any Indemnified Person furnished in writing to the
Company by or on behalf of such Indemnified Person expressly for use therein;
provided that the foregoing indemnity with respect to any preliminary Prospectus
shall not inure to the benefit of any Indemnified Person from whom the person
asserting such losses, claims, damages, liabilities and judgments purchased
securities if such untrue statement or omission or alleged untrue statement or
omission made in such preliminary Prospectus is eliminated or remedied in the
Prospectus and a copy of the Prospectus shall not have been furnished to such
person in a timely manner due to the wrongful action or wrongful inaction of
such Indemnified Person (provided that the Company has delivered the Prospectus
to such Indemnified Person in requisite quantity on a timely basis to permit
such delivery or sending).
(b) In case any action shall be brought against any Indemnified Person,
based upon any Registration Statement or any such Prospectus or any amendment or
supplement thereto and with respect to which indemnity may be sought against the
Company, such Indemnified Person shall promptly notify the Company in writing
and the Company shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to such Indemnified Person and payment of all
fees and expenses. Any Indemnified Person shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of such
Indemnified Person, unless (i) the employment of such counsel shall have been
specifically authorized in writing by the Company, (ii) the Company shall have
failed to assume the defense and employ counsel or (iii) the named parties to
any such action (including any impleaded parties) include both such Indemnified
Person and the Company and such Indemnified Person shall have been advised in
writing by counsel that the representation of such Indemnified Person and the
Company by the same counsel would be inappropriate under applicable standards of
professional conduct (whether or not such representation by the same counsel has
been proposed) due to an actual or reasonably anticipated material conflict of
interest between them (in which case the Company shall not have the right to
assume the defense of such action on behalf of such Indemnified Person, it being
understood, however, that the Company shall not, in connection with any one such
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys (in addition to any local counsel) for all such Indemnified Persons,
which firm shall be designated in writing by such Indemnified Persons, and that
all such fees and expenses shall be reimbursed as they are incurred). The
Company shall not be liable for any settlement of any such action effected
without its written consent but if settled with the written consent of the
Company, the Company agrees to indemnify and hold harmless any Indemnified
Person from and against any loss or liability by reason of such settlement. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement (i)
includes an unconditional release of such indemnified party from all liability
on claims that are or could have been the subject matter of such proceeding and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act, by or on behalf of the indemnified party.
(c) In connection with any Registration Statement in which a Holder of
Transfer Restricted Securities is participating, such Holder of Transfer
Restricted Securities agrees, severally and not jointly, to indemnify and hold
harmless the Company, its directors, its officers and any person controlling the
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, to the same extent as the foregoing indemnity from the Company to
each Indemnified Person but only with reference to information relating to such
Indemnified Person furnished in writing by or on behalf of such Indemnified
Person expressly for use in such Registration Statement. In case any action
shall be brought against the Company, any of its directors, any such of officer
or any person controlling the Company based on such Registration Statement and
in respect of which indemnity may be sought against any Indemnified Person, the
Indemnified Person shall have the rights and duties given to the Company (except
that if the Company shall have assumed the defense thereof, such Indemnified
Person shall not be required to do so, but may employ separate counsel therein
and participate in defense thereof but the fees and expenses of such counsel
shall be at the expense of such Indemnified Person), and the Company, its
directors, any such officers and any person controlling the Company shall have
the rights and duties given to the Indemnified Person, by Section 6(b) hereof.
(d) If the indemnification provided for in this Section 6 is
unavailable to an indemnified party in respect of any losses, claims, damages,
liabilities or judgments referred to therein, then each indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, claims,
damages, liabilities and judgments (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand and each
Indemnified Person on the other hand from the offering of the Notes or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
each such Indemnified Person in connection with the statements or omissions
which resulted in such losses, claims, damages, liabilities or judgments, as
well as any other relevant equitable considerations. The relative fault of the
Company and each such Indemnified Person shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission to state a material fact relates to information supplied by
the Company or such Indemnified Person and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Purchasers agree that it would not be just and
equitable if contribution pursuant to this Section 6(d) were determined by pro
rata allocation (even if the Indemnified Persons were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 6, no Indemnified Person shall be
required to contribute any amount in excess of the amount by which the proceeds
received by it in connection with the sale of the Transfer Restricted Securities
pursuant to this Agreement exceeds the amount of any damages which such
Indemnified Person has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Indemnified Persons'
obligations to contribute pursuant to this Section 6(d) are several in
proportion to the respective amount of Notes included in any such Registration
Statement by each Indemnified Person and not joint.
7. Rules 144 and 144A
The Company shall use all reasonable efforts to file the reports
required to be filed by it under the Securities Act and the Exchange Act in a
timely manner and, if at any time it is not required to file such reports but in
the past had been required to or did file such reports, it will, upon the
request of any holder of Transfer Restricted Securities, make available other
information as required by, and so long as necessary to permit, sales of its
Transfer Restricted Securities pursuant to Rule 144 and Rule 144A.
Notwithstanding the foregoing, nothing in this Section 7 shall be deemed to
require the Company to register any of its securities pursuant to the Exchange
Act.
8. Underwritten Registrations
(a) If any of the Transfer Restricted Securities covered by any Shelf
Registration are to be sold in an underwritten offering, the investment banker
or investment bankers and manager or managers that will administer the offering
will be selected by the Holders of a majority in amount of such Transfer
Restricted Securities (determined on a fully converted basis) included in such
offering, subject to the consent of the Company (which will not be unreasonably
withheld or delayed).
No person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such person's Transfer Restricted
Securities on the basis reasonably provided in any underwriting arrangements
approved by the persons entitled hereunder to approve such arrangements and (ii)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of such
underwriting arrangements.
(b) Each Holder of Transfer Restricted Securities agrees, if requested
(pursuant to a timely written notice) by the managing underwriters in an
underwritten offering, not to effect any private sale or distribution (including
a sale pursuant to Rule 144(k) and Rule 144A, but excluding non-public sales to
any of its affiliates, officers, directors, employees and controlling persons)
of any of the Notes, in the case of an offering of the Company's debt
securities, or the Common Stock, in the case of an offering of the Company's
equity securities, during the period beginning 10 days prior to, and ending 90
days after, the closing date of the underwritten offering.
The foregoing provisions of this Section 8(b) shall not apply to any
Holder of Transfer Restricted Securities if such Holder is prevented by
applicable statute or regulation from entering into any such agreement.
(c) The Initial Purchasers and all Holders of Transfer Restricted
Securities agree that, notwithstanding any other term or provision hereof, the
Company shall not be required to enter into any agreements (including
underwriting agreements) or take any other actions contemplated by Section 4(m)
hereof unless requested in writing by the holders of at least 50% of the
Transfer Restricted Securities (determined on a fully converted basis) sold to
the Initial Purchasers pursuant to the Purchase Agreement.
9. Miscellaneous
(a) Remedies. In the event of a Registration Default by the Company,
the sole remedy of the holders of Transfer Restricted Securities will be the
Liquidated Damages set forth in Section 3 of this Agreement. In the event of a
breach by the Company, or by a holder of Transfer Restricted Securities, of any
of their obligations under this Agreement other than any breach by the Company
that results in a Registration Default, each holder of Transfer Restricted
Securities or the Company, in addition to being entitled to exercise all rights
granted by law, including recovery of damages, will be entitled to specific
performance of its rights under this Agreement. The Company and each holder of
Transfer Restricted Securities agree that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of any of the
provisions of this Agreement that does not result in a Registration Default, and
hereby further agrees that, in the event of any action for specific performance
in respect of such breach, it shall waive the defense that a remedy at law would
be adequate.
(b) No Inconsistent Agreements. The Company shall not enter into any
agreement with respect to its securities that is inconsistent with the rights
granted to the holders of Transfer Restricted Securities in this Agreement or
otherwise conflicts with the provisions hereof.
(c) No Piggyback on Registrations. The Company shall not grant to any
of its security holders (other than the Holders of Transfer Restricted
Securities in such capacity) the right to include any of its securities in any
Shelf Registration Statement filed pursuant to this Agreement other than
Transfer Restricted Securities.
(d) Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given, without the written consent of the Holders of a majority of the then
outstanding Transfer Restricted Securities (determined on a fully converted
basis); provided, however, that, for the purposes of this Agreement, Transfer
Restricted Securities that are owned, directly or indirectly, by either the
Company or an Affiliate of the Company are not deemed outstanding.
Notwithstanding the foregoing, a waiver or consent to depart from the provisions
hereof with respect to a matter that relates exclusively to the rights of
Holders of Transfer Restricted Securities whose securities are being sold
pursuant to a Registration Statement and that does not directly or indirectly
affect the rights of other Holders of Transfer Restricted Securities may be
given by Holders of a majority of the Transfer Restricted Securities (determined
on a fully converted basis) being sold by such Holders pursuant to such
Registration Statement; provided, however, that the provisions of this sentence
may not be amended, modified, or supplemented except in accordance with the
provisions of the immediately preceding sentence.
(e) Notices. All notices and other communications provided for herein
shall be made in writing by hand delivery, next day air courier, certified
first-class mail, return receipt requested, telex or telecopy:
(i) if to the Company, as provided in the Purchase Agreement,
(ii) if to the Purchasers, as provided in the Purchase Agreement, or
(iii) if to any other person who is then the registered Holder of any
Transfer Restricted Securities, to the address of such Holder as it appears in
the Note or Common Stock register of the Company.
Except as otherwise provided in this Agreement, all such communications
shall be deemed to have been duly given: when delivered by hand, if personally
delivered; one Business Day after being timely delivered to a next-day air
courier; five Business Days after being deposited in the mail, postage prepaid,
if mailed; when answered back, if telexed; and when receipt is acknowledged by
the recipient's telecopier machine, if telecopied.
(f) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and permitted assigns of each of the
parties and shall inure to the benefit of each Holder of Transfer Restricted
Securities. The Company may not assign its rights or obligations hereunder
without the prior written consent of each Holder of Transfer Restricted
Securities. Notwithstanding the foregoing, no transferee shall have any of the
rights granted under this Agreement until such transferee shall acknowledge its
rights and obligations hereunder by a signed written statement of such
transferee's acceptance of such rights and obligations.
(g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement
(h) Governing Law: Submission to Jurisdiction. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
(i) Severability. The remedies provided herein are cumulative and not
exclusive of any remedies provided by law. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their reasonable efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.
(j) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof. All
references made in this Agreement to "Section" and "paragraph" refer to such
Section or paragraph of this Agreement, unless expressly stated otherwise.
(k) Attorneys' Fees. In any action or proceeding brought to enforce any
provision of this Agreement, or where any provision hereof is validly asserted
as a defense, the prevailing party, as determined by the court, shall be
entitled to recover its reasonable attorneys' fees in addition to any other
available remedy.
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Registration Rights Agreement
to be duly executed as of the date first written above.
FINE HOST CORPORATION
By: ___________________________
Name:
Title:
The foregoing Registration Rights Agreement is hereby confirmed and accepted as
of the date first above written.
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By: ___________________________
Name:
Title:
NATIONSBANC MONTGOMERY
SECURITIES, INC.
By: ___________________________
Name:
Title:
SMITH BARNEY INC.
By: ___________________________
Name:
Title:
PIPER JAFFRAY INC.
By: ___________________________
Name:
Title:
FOURTH AMENDED AND RESTATED LOAN AGREEMENT
Dated as of July 30, 1997
Among
FINE HOST CORPORATION
AND ALL OF ITS SUBSIDIARIES
(collectively, the "Borrowers"),
BANKBOSTON, N.A.
AS ADMINISTRATIVE AGENT FOR THE BANKS
(the "Administrative Agent"),
USTRUST
AS DOCUMENTATION AGENT FOR THE BANKS
(the "Documentation Agent"),
and
CERTAIN BANKS AND OTHER FINANCIAL INSTITUTIONS
(the "Banks")
<PAGE>
TABLE OF CONTENTS
Item Page No.
1.DEFINITIONS
1.1 General Terms...........................................................2
1.2 Accounting Terms.......................................................24
1.3 Other Terms Defined in the UCC.........................................24
1.4 Construction...........................................................24
2.LOANS AND LETTERS OF CREDIT
2.1 Working Capital Loans..................................................24
2.1.1 Working Capital Commitment.....................................24
2.1.2 Procedure for Working Capital Borrowing .......................25
2.1.3 Use of Working Capital Proceeds ...............................26
2.1.4 Commitment Fee ................................................26
2.1.5 Termination or Reduction of Commitments .......................26
2.1.6 Repayment of Working Capital Loans; Evidence of Debt ..........27
2.1.7 Swing Line Commitment .........................................27
2.1.8 Repayment of Swing Line Loans; Evidence of Debt ...............28
2.1.9 Procedure for Borrowing Swing Line Loans ......................29
2.1.10 Swing Line Loan Participants...................................29
2.1.11 Letter of Credit Commitment ...................................30
2.1.12 Procedure for Issuance of Letter of Credit ....................31
2.1.13 Fees, Commissions and Other Charges ...........................32
2.1.14 L/C Participations ............................................32
2.1.15 Reimbursement Obligation of the Borrowers .....................33
2.1.16 Obligations Absolute ..........................................34
2.1.17 Letter of Credit Payments .....................................34
2.1.18 Application ...................................................35
2.1.19 Quarterly Reports .............................................35
2.2 Guidance Loans.........................................................35
2.2.1 Guidance Loan Commitment .......................................35
2.2.2 Procedure for Guidance Loan Borrowing ..........................35
2.2.3 Use of Guidance Loan Proceeds ..................................36
2.2.4 Commitment Fee .................................................36
2.2.5 Conversion of Guidance Loans ...................................37
2.2.6 Termination or Reduction of Commitments ........................37
2.2.7 Repayment of Guidance Loans; Evidence of Debt ..................37
3.GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF
CREDIT
3.1 Optional and Mandatory Prepayments....................................38
3.2 Conversion Options....................................................40
3.3 Minimum Amounts and Maximum Number of Loans...........................41
3.4 Interest Rates and Payment Dates......................................41
3.5 Computation of Interest and Fees......................................42
3.6 Inability to Determine Interest Rate..................................42
3.7 Pro Rata Treatment and Payments.......................................42
3.8 Illegality............................................................43
3.9 Requirements of Law...................................................44
3.10 Taxes.................................................................45
3.11 Indemnity.............................................................48
3.12 Change of Lending Office; Filing of Certificates or Documents.........49
3.13 Replacement Banks.....................................................49
3.14 Subordination of Intercompany Loans...................................49
3.15 Fees..................................................................51
4.CONDITIONS PRECEDENT
4.1 Conditions to Effectiveness and Initial Extensions of Credit..........51
4.2 Conditions to Each Extension of Credit................................54
4.3 Add. Conditions Precedent for Each Guidance Loan of $1MM or More......55
5.REPRESENTATIONS, WARRANTIES AND COVENANTS
5.1 Legal Existence; Compliance with Law..................................56
5.2 Power; Authorization; Enforceable Obligations.........................57
5.3 Financial Data........................................................57
5.4 Tangible Assets.......................................................58
5.5 Title to Collateral...................................................58
5.6 Real Property; Leases.................................................58
5.7 Solvency..............................................................59
5.8 Tax Liabilities.......................................................59
5.9 Loans.................................................................59
5.10 Margin Securities.....................................................60
5.11 Subsidiaries..........................................................60
5.12 No Material Litigation................................................61
5.13 SEC Filings...........................................................61
5.14 Material Agreements...................................................61
5.15 Employee Controversies and Employment and Labor Agreements............62
5.16 Material Licenses.....................................................63
5.17 Intellectual Property Rights..........................................64
5.18 Pension Related Matters...............................................64
5.19 Environmental Matters.................................................64
5.20 Broker's Fee..........................................................65
5.21 Securities Matters....................................................65
5.22 Disclosure............................................................65
5.23 Facility Agreements...................................................65
5.24 Security Documents ...................................................66
5.25 Subordinated Debt ....................................................66
6.CERTAIN AFFIRMATIVE COVENANTS
6.1 Financial Statements .................................................66
6.2 Inspection............................................................69
6.3 Conduct of Business...................................................70
6.4 Claims and Taxes......................................................70
6.5 Costs and Expenses of Agents and Banks as Additional Liabilities......70
6.6 Insurance.............................................................71
6.7 Pension Plans.........................................................73
6.8 Notice of Suit........................................................73
6.9 Environmental Notices.................................................74
6.10 Use of Proceeds.......................................................74
6.11 Maintenance of Liens of Security Documents............................74
6.12 Pledge of After Acquired Property; Additional Subsidiaries............74
7.CERTAIN NEGATIVE COVENANTS
7.1 Financial Covenants...................................................76
7.2 Encumbrances..........................................................76
7.3 Indebtedness..........................................................77
7.4 Mergers and Consolidations............................................77
7.5 Acquisitions..........................................................77
7.6 Disposal of Property..................................................78
7.7 Investments or Loans..................................................79
7.8 Guaranties............................................................79
7.9 Capital Expenditure Limitations.......................................79
7.10 Limitations on Project Costs..........................................79
7.11 Distributions.........................................................80
7.12 Compensation..........................................................80
7.13 Transactions with Affiliates..........................................81
7.14 Prepayment of Other Liabilities.......................................81
7.15 Amendment of Charter..................................................81
7.16 ERISA Termination Event...............................................81
8.DEFAULT, RIGHTS AND REMEDIES OF THE ADMINISTRATIVE
AGENT
8.1 Event of Default......................................................81
8.2 Termination of Obligation to Make Loans and Acceleration..............83
8.3 Rights and Remedies Generally.........................................83
8.4 Entry Upon Premises and Access to Information.........................84
8.5 Sale or Other Disposition of Collateral by the Admin. Agent...........84
8.6 Waiver of Demand......................................................85
8.7 Waiver of Notice......................................................85
8.8 Advice of Counsel.....................................................85
9.THE ADMINISTRATIVE AGENT
9.1 Appointment........................................................85
9.2 Delegation of Duties...............................................85
9.3 Exculpatory Provisions. ...........................................85
9.4 Reliance by Administrative Agent...................................86
9.5 Notice of Default. ................................................86
9.6 Non-Reliance on Administrative Agent and Other Banks...............87
9.7 Indemnification....................................................87
9.8 Administrative Agent in Its Individual Capacity....................88
9.9 Successor Administrative Agent.....................................88
9.10 Removal of Administrative Agent....................................88
9.11 Issuing Bank; Swing Line Bank......................................88
10MISCELLANEOUS
10.1 Amendments and Waivers................................................89
10.2 Attorneys' Fees and Expenses..........................................90
10.3 Expenditures by the Administrative Agent..............................90
10.4 Custody and Preservation of Collateral................................90
10.5 Reliance by the Banks.................................................90
10.6 Counterparts..........................................................90
10.7 Submission to Jurisdiction; Jury Trial Waiver; Waiver of Bond.........91
10.8 Application of Payments...............................................91
10.9 Adjustments; Set Off..................................................91
10.10 Section Titles........................................................92
10.11 Continuing Effect.....................................................92
10.12 Notices...............................................................92
10.13 Equitable Relief......................................................94
10.14 Entire Agreement......................................................94
10.15 Successors and Assigns; Participations and Assignments................94
10.15.1 Successors and Assigns....................................94
10.15.2 Participations............................................94
10.15.3 Assignments ..............................................94
10.15.4 Register..................................................95
10.15.5 Processing Fee............................................96
10.16 Changes in Accounting Principles......................................96
10.17 Indemnity.............................................................96
10.18 Representations and Warranties .......................................97
10.19 Treatment of Certain Information......................................97
10.20 Independence of Covenants.............................................97
10.21 Time of the Essence...................................................97
10.22 Limitation on Liabilities - Joint Venture Subsidiary Borrowers........97
10.23 Joint and Several Liability...........................................98
10.24 Documentation Agent...................................................99
10.25 Borrower Agent........................................................99
10.26 Applicable Law; Severability..........................................99
ANNEXES
Annex A Pricing Grid
Annex B Commitments, Lending Offices and Addresses
Annex C Form of Assignment and Assumption
Annex D Form of Subordination
EXHIBITS
Exhibit A Form of First Amended and Restated Working Capital Note
Exhibit B Form of Swing Line Note
Exhibit C Form of First Amended and Restated Guidance Note
Exhibit D Form of Second Amended and Restated
Security Agreement (for Fine Host Corporation)
Exhibit E Form of [Second] Amended and Restated
Security Agreement (for [Name of Joint Venture Subsidiary
Borrower])
Exhibit F Form of [Second] Amended and Restated
Security Agreement (for [Name of Subsidiary Borrower])
Exhibit G Form of Second Amended and Restated
Assignment of Receivables and Proceeds (for Fine Host
Corporation)
Exhibit H Form of [Second]Amended and Restated
Assignment of Receivables and Proceeds
(for [Name of Joint Venture Subsidiary Borrower])
Exhibit I Form of [Second] Amended and Restated
Assignment of Receivables and Proceeds
(for [Name of Subsidiary Borrower])
Exhibit J Form of Amended and Restated Pledge Agreement - Joint Venture
Interest
Exhibit K Form of Amended and Restated Pledge Agreement - Membership Interest
Exhibit L Form of Amended and Restated Pledge Agreement - Stock
Exhibit M Form of Kentucky Mortgage
Exhibit N Form of Kentucky Conditional Assignment of Rentals
Exhibit O Form of Borrowing Certificate
Exhibit P Form of Opinion of Willkie Farr & Gallagher
SCHEDULES
Schedule 4.1(c) Lien Searches
Schedule 5.4 Tangible Assets
Schedule 5.5 Title to Collateral
Schedule 5.6 Real Property; Leases
Schedule 5.9 Loans
Schedule 5.11(a) Corporate Subsidiary Borrowers
Schedule 5.11(b) Joint Venture Subsidiary Borrowers
Schedule 5.11(c) LLC Subsidiary Borrowers
Schedule 5.12 No Material Litigation
Schedule 5.14 Material Agreements
Schedule 5.15 Employment Controversies and Employment and Labor Agreements
Schedule 5.16(a) Material Licenses
Schedule 5.16(b) License Violations
Schedule 5.19 Environmental Matters
Schedule 5.25 Subordinated Debt
Schedule 7.2 Permitted Liens
Schedule 7.3 Permitted Indebtedness
Schedule 7.7 Ongoing Investments
Schedule 7.8 Guaranties
Schedule 7.12 Compensation
Schedule 7.13 Transactions with Affiliates
<PAGE>
This FOURTH AMENDED AND RESTATED LOAN AGREEMENT (this "Agreement") is
made as of July 30, 1997, by and among (a) FINE HOST CORPORATION, a Delaware
corporation, for itself and as agent for all of the Borrowers (hereinafter
referred as "Fine Host" when acting for itself and as the "Borrower Agent" when
acting as agent for all of the Borrowers (including Fine Host)), (b) all of the
Subsidiaries of Fine Host (said Subsidiaries, together with Fine Host and any
and all other Subsidiaries which may hereafter become parties to this Agreement,
are hereinafter sometimes referred to collectively as the "Borrowers" and each
singly as a "Borrower"), (c) VARIOUS BANKS AND OTHER FINANCIAL INSTITUTIONS
which are, or may become, parties hereto (hereinafter referred to collectively
as the "Banks" and each singly as a "Bank"), (d) BANKBOSTON, N.A., a national
banking association ("BankBoston"), as administrative agent for the Banks (in
such capacity, the "Administrative Agent"), and (e) USTRUST, a Massachusetts
trust company ("USTrust"), as documentation agent for the Banks (in such
capacity, the "Documentation Agent")(the Administrative Agent and the
Documentation Agent are hereinafter sometimes referred to collectively as the
"Agents"). All of the obligations and liabilities of the Borrowers under this
Agreement and all of the other Loan Documents are joint and several.
PRELIMINARY STATEMENTS
WHEREAS, Fine Host and certain of its Subsidiaries are parties to that
certain Third Amended and Restated Loan Agreement, dated as of June 25, 1996, by
and among Fine Host, certain of its Subsidiaries, certain Banks and other
financial institutions named therein (the "Existing Banks"), and USTrust as
Lender and Agent for the Existing Banks, as amended by (a) a certain First
Amendment thereto, dated as of May 9, 1997 and (b) a certain Second Amendment
thereto, dated as of June 30, 1997, pursuant to which, among other things, the
Existing Banks have made and agreed to make certain loans to Fine Host, all as
more particularly described therein (such Third Amended and Restated Loan
Agreement, as so amended, is hereinafter referred to as the "Existing Loan
Agreement"); and
WHEREAS, the Borrowers have requested that the Existing Loan Agreement
be amended, restated and superseded in its entirety as provided for herein; and
WHEREAS, the Existing Banks are willing, upon the terms and conditions
hereof, to amend, restate and supersede in its entirety the Existing Loan
Agreement in the manner provided for herein; and
WHEREAS, the Agents and all of the Banks which are not Existing Banks
wish to become parties to this Agreement;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, and other good and value consideration, the receipt and
sufficient of which are hereby acknowledged, the parties hereto agree that the
Existing Loan Agreement is hereby amended, restated and superseded in its
entirety to read as follows:
1. DEFINITIONS
1.1 General Terms. When used herein, the following capitalized
terms shall have the following meanings:
"ABR" shall mean, for any day, a rate per annum equal to the
higher of: (a) the Base Rate, and (b) one-half of one percent (1/2%)
percent above the Federal Funds Rate in effect on such day.
"ABR Loans" shall mean Loans the rate of interest applicable
to which is based upon the ABR.
"Acceptable Supplement" shall have the meaning given to that
term in subsection 5.5.
"Accumulated Funding Deficiency" shall mean a funding
deficiency described in Section 302 of ERISA.
"Adjusted Consolidated EBITDA" means, for any period, the
Consolidated EBITDA of the Borrowers for such period, plus the
aggregate unadjusted historical Consolidated EBITDA of each acquired
business or target company in every Permitted Acquisition which is
consummated in such period for the four (4) fiscal quarters immediately
preceding the date of acquisition of such acquired business or target
company.
"Adjustment Date" means the tenth Business Day following
receipt by the Administrative Agent of both (i) the financial
statements required to be delivered pursuant to subsection 6.1(a) or
(b), as the case may be, for the most recently completed fiscal period
specified therein and (ii) the certificate required to be delivered
pursuant to subsection 6.1(e) with respect to such fiscal period.
"Administrative Agent" shall have the meaning given to that
term in the first paragraph of this Agreement.
"Affiliate" means, as applied to any Person, any other Person
(other than the Borrowers) (a) that directly or indirectly, through one
or more intermediaries, controls or is controlled by, or is under
common control with, any Borrower, (b) that directly or beneficially
owns or holds ten percent (10%) or more of any class of the voting
stock (or in the case of a Person which is not a corporation, ten
percent (10%) or more of the equity interest) of any Borrower or (c)
ten percent (10%) or more of whose voting stock (or in the case of a
Person which is not a corporation, ten percent (10%) or more of the
equity interest) is owned directly or beneficially or held by any
Borrower.
"Agents" shall have the meaning given to that term in the
first paragraph of this Agreement.
"Agreement" means this Fourth Amended and Restated Loan
Agreement, together with all annexes, exhibits and schedules hereto, as
amended, modified, supplemented, restated or extended from time to
time.
"Aggregate Working Capital Outstandings" means as to any Bank
at any time, an amount equal to the sum of (a) the aggregate principal
amount of all Working Capital Loans made by such Bank then outstanding,
plus (b) such Bank's Working Capital Commitment Percentage of L/C
Obligations then outstanding, plus (c) such Bank's Working Capital
Commitment Percentage of the aggregate principal amount of the Swing
Line Loans then outstanding.
"Applicable Margin" means, for each LIBOR Loan, .75%;
provided, however, that, from and after September 24, 1997, the
Applicable Margin for all LIBOR Loans will be adjusted, on each
Adjustment Date based upon the ratio of Consolidated Debt at the last
day of the 12 month period ended on the date of the financial
statements relating to such Adjustment Date to the Adjusted
Consolidated EBITDA for such period as determined from such financial
statements, to the Applicable Margin set forth on Annex A attached
hereto opposite the level for which the ratio of Consolidated Debt to
Adjusted Consolidated EBITDA as so determined satisfies the
corresponding criteria set forth under the heading "Ratio of
Consolidated Debt to Adjusted Consolidated EBITDA."
"Application" means an application, in such form as the
Issuing Bank may specify from time to time, requesting the Issuing
Bank, to issue a Letter of Credit.
"Approval" means each approval, consent, filing or
registration by or with any Federal, state or other regulatory
authority necessary to authorize or permit the execution, delivery or
performance of this Agreement or the Loan Documents or for the validity
or enforceability hereof or thereof by the Borrowers and their
Affiliates.
"Asset Sale" means as to any Person, any sale or other
disposition subsequent to the Closing Date of any property of such
Person (other than (a) sales of inventory in the ordinary course of
business and (b) sales of property by any Borrower to any other
Borrower).
"Assignee" shall have the meaning set forth in subsection
10.15.3.
"Assignments of Receivables and Proceeds" means collectively
the Assignment of Receivables and Proceeds Fine Host, the Assignments
of Receivables and Proceeds - Joint Venture Subsidiary Borrower and the
Assignments of Receivables and Proceeds - Subsidiary Borrower.
"Assignment of Receivables and Proceeds - Fine Host" means the
Amended and Restated Assignment of Receivables and Proceeds, to be
executed and delivered by Fine Host, substantially in the form attached
hereto as Exhibit G, as the same may be amended, modified,
supplemented, or restated, from time to time.
"Assignments of Receivables and Proceeds - Joint Venture
Subsidiary Borrower" means the Amended and Restated Assignment of
Receivables and Proceeds, to be executed and delivered by each Joint
Venture Subsidiary Borrower, substantially in the form attached hereto
as Exhibit H, as the same may be amended, modified, supplemented, or
restated, from time to time.
"Assignments of Receivables and Proceeds - Subsidiary
Borrower" means the Amended and Restated Assignment of Receivables and
Proceeds, to be executed and delivered by each Subsidiary Borrower
(other than each Subsidiary Borrower which is a Joint Venture
Subsidiary Borrower), substantially in the form attached hereto as
Exhibit I, as the same may be amended, modified, supplemented, or
restated, from time to time.
"Available Working Capital Commitment" means as to any Bank at
any time, an amount equal to the excess, if any, of (a) the amount of
such Bank's Working Capital Commitment at such time over (b) such
Bank's Aggregate Working Capital Outstandings at such time;
collectively, as to all the Banks, the "Available Working Capital
Commitments".
"Banks" means the banks and other financial institutions which
are parties to this Agreement, including each Person who becomes an
Assignee in accordance with the provisions of subsection 10.15.3.
"Base Rate" means the variable rate of interest, per annum,
most recently announced by BankBoston at its headquarters in Boston,
Massachusetts, as its "base rate," with the understanding that
BankBoston's "base rate" is one of its interest rates and serves as a
basis upon which effective rates of interest are calculated for loans
making reference thereto and may not be the lowest of BankBoston's
interest rates. Any change in the Base Rate shall be effective as of
the effective date stated in the announcement by BankBoston of such
change.
"Benefited Bank" shall have the meaning given to that term in
subsection 10.9(a).
"Board of Governors" means the Board of Governors of the
Federal Reserve System and any Governmental Authority which succeeds to
the powers and functions thereof.
"Borrower Agent" shall have the meaning given to that term in
the first paragraph of this Agreement.
"Borrowing Date" means any Business Day specified in a notice
pursuant to subsection 2.1.2, 2.1.9 or 2.2.2 as a date on which the
Borrower Agent requests the Banks to make Loans hereunder.
"Business Day" means any day other than a Saturday, Sunday,
public holiday under the laws of the Commonwealth of Massachusetts or
any other day on which banking institutions are authorized or are
required to be closed in Boston, Massachusetts.
"Capital Expenditure" shall mean, for any period, the sum of
(a) the aggregate amount of all expenditures of the Borrowers for fixed
or capital assets made during such period which, in accordance with
GAAP, would be classified as capital expenditures, and (b) the
aggregate amount of all Capitalized Lease Obligations incurred during
such period.
"Capitalized Lease Obligations" means, for any period, all
obligations of any Borrower under any lease of property (real, personal
or mixed) or other periodic payment arrangement which have been or
should be capitalized on the consolidated balance sheet of the
Borrowers in accordance with GAAP, in each case taken at the amount
thereof accounted for as indebtedness, net of interest expense,
determined in accordance with GAAP, the stated maturity of which shall
be the date of the last payment of any amount thereunder prior to the
first date upon which such arrangement may be terminated by any
Borrower without payment of any penalty.
"Cash Equivalents" means, at any time: (i) securities issued
or directly and fully guaranteed or insured by the United States of
America or any agency or instrumentality thereof (provided that the
full faith and credit of the United States of America is pledged in
support thereof) having maturities of not more than one year from the
date of acquisition, (ii) time deposits and certificates of deposit
with maturities of not more than 90 days from the date of acquisition,
of (x) any commercial banking institution that is a member of the
Federal Reserve System having capital and surplus in excess of
$500,000,000, whose debt has a rating at the time of any such
investment of at least "A-2" or the equivalent thereof by Standard &
Poor's or at least "P-2" or the equivalent thereof by Moody's or (y)
any Bank, (iii) fully secured repurchase obligations with a term of not
more than seven days for underlying securities of the types described
in clause (i) entered into with BankBoston or USTrust, and (iv)
commercial paper issued by (x) the parent corporation of any commercial
banking institution that is a member of the Federal Reserve System
having capital and surplus in excess of $500,000,000 and commercial
paper or master notes of issuers, rated at the time of any such
investment at least "A-2" or the equivalent thereof by Standard &
Poor's or at least "P-2" or the equivalent thereof by Moody's or (y)
any Bank, and in each case maturing within 270 days after the date of
acquisition.
"Capital Stock" means any and all shares, interests,
participations or other equivalents (however designated) of capital
stock of a corporation, any and all equivalent ownership interests in a
Person (other than a corporation) and any and all warrants or options
to purchase any of the foregoing.
"Change in Control" shall mean that a
majority of the members of the Board of
Directors of Fine Host are not Continuing
Directors.
"Closing Date" means the date hereof.
"Closing Fee" shall have the meaning given to that term in
subsection 3.15(a).
"Collateral" means all assets of the Borrowers, now owned or
hereinafter acquired, upon which a Lien is purported to be created by
any Security Document.
"Commercial Letter of Credit" shall have the meaning given to
that term in subsection 2.1.11(b).
"Commitment" means with respect to any Bank, the collective
reference to such Bank's Working Capital Commitment, Guidance Loan
Commitment, and L/C Commitment; collectively, as to all of the Banks,
the "Commitments." The maximum principal amount of all of the
Commitments shall not, at any time, exceed Two Hundred Million and
00/100 Dollars ($200,000,000.00).
"Commitment Percentage" means as to any Bank at any time, the
percentage which (i) the sum of (a) such Bank's then Available Working
Capital Commitment and other unused Commitments (other than Working
Capital Commitments) plus (b) such Bank's Loans (other than Swing Line
Loans) then outstanding plus (c) the product of such Bank's Working
Capital Commitment Percentage times the sum of (I) the Swing Line Loans
then outstanding and (II) the L/C Obligations then outstanding then
constitutes of (ii) the sum of (w) the aggregate Available Working
Capital Commitments of the Banks and the other unused Commitments of
all of the Banks (other than Working Capital Commitments) plus (x) the
aggregate principal amount of Loans of all of the Banks then
outstanding plus (y) the aggregate L/C Obligations of all of the Banks
then outstanding.
"Consolidated Cash Interest Expense" means, with respect to
any Person for any period, the Consolidated Interest Expense of such
Person for such period, less all non-cash items included in
Consolidated Interest Expense during such period (including, without
limitation, amortization of debt discounts and payments of interest on
Indebtedness through the issuance of Indebtedness and all fees paid or
payable to the Banks in connection with the transactions contemplated
by the Existing Agreement and this Agreement (including without
limitation, the Closing Fee)).
"Consolidated Debt" means at any date of determination, all
Indebtedness of the Borrowers at such date of determination as
determined on a consolidated basis in accordance with GAAP.
"Consolidated EBITDA" means for any period, the Consolidated
Net Income or Consolidated Net Loss, whichever is applicable, of the
Borrowers or of the acquired business or the target company in a
Permitted Acquisition, as the case may be, for such period, plus, to
the extent deducted in determining such Consolidated Net Income or
Consolidated Net Loss, whichever is applicable, (i) Consolidated
Interest Expense, of the Borrowers or of the acquired business or the
target company in a Permitted Acquisition, as the case may be, (ii)
depreciation, (iii) amortization, (iv) all Federal, state, local and
foreign income taxes and (v) all other non-cash expenses, minus, to the
extent added in determining such Consolidated Net Income or
Consolidated Net Loss, whichever is applicable, any non-cash income or
non-cash gains, all as determined on a consolidated basis in accordance
with GAAP.
"Consolidated Interest Expense" means for any period, the net
interest expense of the Borrowers or of the acquired business or the
target company in a Permitted Acquisition, as the case may be, for such
period as determined on a consolidated basis in accordance with GAAP.
"Consolidated Net Income" means for any period, the net income
of the Borrowers or of the acquired business or the target company in a
Permitted Acquisition, as the case may be, for such period as
determined on a consolidated basis in accordance with GAAP.
"Consolidated Net Loss" means for any period, the net loss of
the Borrowers or of the acquired business or the target company in a
Permitted Acquisition, as the case may be, for such period as
determined on a consolidated basis in accordance with GAAP.
"Consolidated Net Worth" means at any date of determination,
all items which would, in accordance with GAAP, be included under
shareholders' equity on a consolidated balance sheet of the Borrowers
at such date of determination (including, without limitation, all
amounts received by any Borrower upon the issuance of any additional
Capital Stock of any of such Borrower).
"Continuing Director" means and includes a member of the Board
of Directors of Fine Host who was (i) a member of the Board of
Directors on the date hereof or (ii) nominated for election or elected
to the Board of the Directors with the affirmative vote of at least
two-thirds of (x) members described in clause (i) or (y) members who
were in turn so nominated or so elected by members described in clause
(i) or clause (ii)(x).
"Converted Guidance Amount" shall have the meaning given to
that term in subsection 2.2.5.
"Corporate Subsidiary Borrower" means any Subsidiary which is
a corporation.
"Default" means any event which through the passage of time or
the service of notice or both would (assuming no action is taken by any
Borrower to cure the same) mature into an Event of Default.
"Dollar", "Dollars" and "$" mean lawful money of the United
States of America.
"Employment and Labor Agreements" shall have the meaning given
to that term in subsection 5.15(b).
"Environmental Laws" mean all Laws relating to health, safety
and environmental matters, including without limitation all Laws
relating to the release, disposal, handling, storage, production,
removal, processing or transporting of Hazardous Substances. Such Laws
include but are not limited to the Resource Conservation and Recovery
Act ("RCRA"), 42 U.S.C. ss.6901 et seq as amended; the Comprehensive
Environmental Response, Compensation and Liability Act ("CERCLA"), 42
U.S.C. ss.9601 et seq, as amended; the Toxic Substance Act, 15 U.S.C.
ss.2601 et seq , as amended, the Clean Water Act, 33 U.S.C. ss.466 et
seq, as amended; the Clear Air Act, 42 U.S.C. ss.7401 et seq, as
amended; state and federal superlien and environmental laws and
regulations, including cleanup programs; and United States Department
of Transportation regulations.
"Environmental Notice" means any summons, citation, directive,
information request, notice of potential responsibility, notice of
violation or deficiency, order, claim, complaint, investigation,
proceeding, judgment, letter or other communication, written or oral,
actual or threatened, from the United States Environmental Protection
Agency or other federal, state or local agency or authority, or any
other entity or individual, public or private, concerning (i) any
intentional or unintentional act or omission which involves Management
of Hazardous Substances either on or off any property owned or leased
by any Borrower; (ii) the imposition of any Lien on such property,
including but not limited to Liens asserted by government entities in
connection with Responses to the presence or Release of Hazardous
Substances; and (iii) any alleged violation of or responsibility under
Environmental Laws.
"Equipment" means all of the rights, title, and interests of
the Borrowers in and to equipment (as defined in the UCC), including
without limitation machinery, furniture, vehicles and fixtures and
other tangible personal property (other than Inventory), whether
located on premises owned, leased or occupied by any of Borrowers or
located elsewhere, together with any and all accessions, parts and
appurtenances thereto, whether now owned or hereafter acquired and
owned by any of the Borrowers (including all right, title, and interest
of the Borrowers to any Equipment used in connection with or under a
Facility Agreement).
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute of similar import, and
regulations and rulings thereunder, in each case as in effect from time
to time. References to sections of ERISA shall be construed to refer to
any successor sections.
"ERISA Affiliate" means each trade or business, including each
Borrower, whether incorporated or not, which, together with each such
Borrower, would be treated as a single employer under Section 4001 of
ERISA.
"ERISA Termination Event" means (a) the occurrence of a
Reportable Event or a Prohibited Transaction, (b) the complete or
partial withdrawal (as defined in Sections 4203 and 4205 of ERISA) by
any Borrower or any ERISA Affiliate from a Multiemployer Plan, or the
receipt by any Borrower or any ERISA Affiliate of a demand from any
Multiemployer Plan for withdrawal liability, (c) the filing of a notice
of intent to terminate any Plan or the treatment of a plan amendment as
a termination of any such Plan under Section 4041 of ERISA, (d) as soon
as any Borrower or any ERISA Affiliate has knowledge thereof, any
action causing termination under Section 4041A of ERISA of any
Multiemployer Plan, (e) as soon as any Borrower or any ERISA Affiliate
has knowledge thereof, the institution of proceedings to terminate any
Plan or Multiemployer Plan by the PBGC under Section 4042 of ERISA, or
(f) the occurrence of any other event or condition which might
constitute grounds under Sections 4041A or 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any
Plan.
"Event of Default" shall have the meaning given to that term
in subsection 8.1 hereof.
"Existing Bank" shall have the meaning given that term in the
first paragraph of Preliminary Statements of this Agreement.
"Existing Guidance Notes" means all of the guidance notes of
Fine Host, issued pursuant to subsection 2.2 of the Existing Loan
Agreement.
"Existing Loan Agreement" shall have the meaning given that
term in the first paragraph of Preliminary Statements of this
Agreement.
"Existing Working Capital Notes" means the all of the working
capital notes of Fine Host, issued pursuant to subsection 2.1 of the
Existing Loan Agreement.
"Extension of Credit" means with respect to any Bank, (a) the
making of a Loan by such Bank, and (b) the issuance of a Letter of
Credit.
"Facility Agreements" means all concession, license or
management agreements to which any Borrower is currently or hereafter
becomes a party, and pursuant to which such Borrower has agreed (a) to
provide food, beverage and complementary services at certain facilities
described therein, (b) to operate and otherwise use food, beverage and
liquor licenses at such facilities, or (c) to manage certain concession
and food service areas at such facilities whether such facilities or
locations are owned by such Borrower, any Affiliate of the Borrower, or
any other Person.
"Federal Funds Rate" means, for any day, the weighted average
of the rates on overnight Federal funds transactions with the 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
immediately preceding Business Day) by the Federal Reserve Bank of
Boston, or if such rate is not so published for any day which is a
Business Day, the average of quotations for such day on such
transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by the Administrative
Agent.
"Fee Letter" means the fee letter, dated as of the Closing
Date, from Fine Host to both the Administrative Agent and the
Documentation Agent.
"Fine Host" shall have the meaning given to that term in the
first paragraph of this Agreement.
"GAAP" means generally accepted accounting principles, as
promulgated by the Financial Accounting Standards Board or other
successor governing body, as in effect from time to time, consistently
applied except as
otherwise required by the SEC.
"Governmental Authority" means any nation or government, any
state of other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"Guidance Loan Commitment" means as to any Bank, its
obligation to make a Guidance Loan to the Borrower Agent in an amount
equal to the amount set forth opposite such Bank's name in Annex B
under the heading "Guidance Loan Commitment," as such amount is to be
reduced following the Guidance Loan Conversion Date in accordance with
the provisions of subsection 2.2.5; collectively, as to all the Banks,
the "Guidance Loan Commitments". The maximum principal amount of all of
the Guidance Loan Commitments shall not, at any time, exceed One
Hundred Fifty Million and 00/100 Dollars ($150,000,000.00)
"Guidance Loan Commitment Percentage" means as to any Bank at
any time, the percentage which (i) the sum of (a) such Bank's then
unused Guidance Loan Commitment plus (b)such Bank's Guidance Loans
then outstanding then constitutes of (ii) the sum of (y) the aggregate
outstanding then unused Guidance Loan Commitments of all of the Banks
plus (z) the aggregate principal amount of Guidance Loans of all of the
Banks then outstanding.
"Guidance Loan Commitment Period" means the period from and
after the Closing Date to and including the Guidance Loan Conversion
Date or such earlier date on which the Guidance Loan Commitments shall
terminate
as provided herein.
"Guidance Loan Conversion Date" means the third anniversary
of the Closing Date.
"Guidance Loan Maturity Date" means the sixth anniversary of
the Closing Date.
"Guidance Loans" shall have the meaning given to that term in
subsection 2.2.1(a).
"Guidance Note" shall have the meaning given to that term in
subsection 2.2.7(e).
"Hazardous Substances" means hazardous substances, hazardous
wastes, hazardous waste constituents, hazardous materials, pesticides,
oil and other petroleum products, and toxic substances, including
asbestos and PCBS, as those terms are defined pursuant to Environmental
Laws.
"Impermissible Qualification" means, relative to the opinion
or certification of any independent public accountant as to any
financial statement of any Borrower, any qualification or exception to
such opinion or certification (a) which is of a "going concern" or
similar nature; (b) which relates to the limited scope of examination
of matters relevant to such financial statement; or (c) which relates
to the treatment or classification of any item in such financial
statement and which, as a condition to its removal, would require an
adjustment to such item the effect of which would be to cause any
Borrower to be in default of any of its obligations under subsection
7.1.
"Indebtedness" means without duplication, with respect to any
Person: (a) all obligations of such Person for borrowed money
(including all notes payable and drafts accepted representing
extensions of credit) and all obligations evidenced by bonds,
debentures, notes or other similar instruments on which interest
charges are customarily paid; (b) all obligations, contingent or
otherwise, relative to the face amount of all letters of credit,
whether or not drawn, and banker's acceptances issued for the account
of such Person; (c) all other items (i) which, in accordance with GAAP,
would be included as liabilities on the liability side of the balance
sheet of such Person (including any leasing or similar arrangement
which is classified as a capitalized lease) as of the date at which
Indebtedness is to be determined, and (ii) which are incurred as a
financing, whether or not in the ordinary course of business; (d)
whether or not so included as liabilities in accordance with GAAP, (i)
all obligations of such Person to pay the deferred purchase price of
property or services and indebtedness (excluding prepaid interest
thereon) secured by a Lien on property owned or being purchased by such
Person (including indebtedness arising under conditional sales or other
title retention agreements), whether or not such indebtedness shall
have been assumed by such Person or is limited in recourse; provided,
however, that, for purposes of determining the amount of any
Indebtedness of the type described in this clause, if recourse with
respect to such Indebtedness is limited to such property, the amount of
such Indebtedness shall be limited to the fair market value of such
property; and (ii) all guaranties made by such Person; and (e) net
obligations under interest rate swap, exchange or cap agreements.
"Initial Financial Statements" shall have the meaning given
to that term in subsection 5.3 hereof.
"Insolvent" or "Insolvency" means, with respect to any Person,
when any of the following events shall have occurred in respect of such
Person: admission in writing of its inability, or its general
inability, to pay its debts as they become due, dissolution,
termination of existence, cessation of normal business operations
(other than a temporary cessation due to fire or other casualty, acts
of God, strike or other similar event not within the control of such
Person), insolvency, appointment of a receiver for any material part of
the property of, legal or equitable assignment, conveyance or transfer
of, all or substantially all of the property for the benefit of
creditors by, or a commencement of any proceedings under any bankruptcy
or insolvency Laws or any Laws relating to the relief of debtors,
readjustment of Indebtedness, reorganization, composition or extension
by or against such Person, but shall not include transactions permitted
under subsection 7.4.
"Intercompany Loan" means any advance or loan from any
Borrower to any other Borrower, whether or not using the proceeds of
any of the Loans.
"Interest Payment Date" means (a) as to ABR Loans, the last
day of each fiscal quarter of Fine Host, (b) as to any LIBOR Loan
having an Interest Period of three months or less, the last day of such
Interest Period and (c) as to any LIBOR Loan having an Interest Period
longer than three months, (i) each day which is three months or a whole
multiple of three months, after the first day of such Interest Period,
and (ii) the last day of such Interest Period.
"Interest Period" means, with respect to any LIBOR Loan: (i)
initially, the period commencing on the borrowing or conversion date,
as the case may be, with respect to such LIBOR Loan and ending one,
two, three or six months thereafter, as selected by the Borrower Agent
in its notice of borrowing or notice of conversion, as the case may be
given with respect thereto; and (ii) thereafter, each period commencing
on the last day of the next preceding Interest Period applicable to
such LIBOR Loan and ending one, two, three or six months thereafter, as
selected by the Borrower Agent by irrevocable notice to the
Administrative Agent not less than three Business Days prior to the
last day of the then current Interest Period with respect thereto;
provided, however, that, all of the foregoing provisions relating to
Interest Periods are subject to the following: (1) if any Interest
Period pertaining to a LIBOR Loan would otherwise end on a day that is
not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension would be to
carry such Interest Period into another calendar month in which event
such Interest Period shall end on the immediately preceding Business
Day; (2) the Borrower Agent shall not select any Interest Period for
any Working Capital Loan that would otherwise extend beyond the Working
Capital Maturity Date; (3) the Borrower Agent shall not select any
Interest Period for any Guidance Loan that would otherwise extend
beyond the Guidance Loan Maturity Date; (4) any Interest Period
pertaining to a LIBOR Loan that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period ) shall end on the last Business Day of a calendar month; and
(5) the Borrower Agent shall select Interest Periods so as not to
require a payment or prepayment of any LIBOR Loan during an Interest
Period for such LIBOR Loan.
"Inventory" means all of the right, title, and interest of the
Borrowers in and to any and all inventory (as defined in the UCC),
including without limitation, goods in transit, wheresoever located,
whether now owned or hereafter acquired and owned by any Borrower,
which are held for sale or lease, furnished under any contract of
service or held as raw materials, work-in-process or supplies, and all
materials used or consumed in the business of any Borrower, and shall
include such property the sale or other disposition of which has given
rise to accounts receivable and which has been returned to, or
repossessed or stopped in transit by, any Borrower.
"Investment" means relative to any Person, (a) any loan or
advance made by such Person to any other Person (excluding commission,
travel and similar advances to officers and employees made in the
ordinary course of business); (b) any payment made with respect to a
Facility Agreement that is required to be capitalized or is otherwise
capitalized as a contract right pursuant to GAAP; (c) any guaranty of
such Person; and (d) any ownership or similar interest held by such
Person in any other Person. The amount of any Investment shall be the
original principal or capital amount thereof less all returns of
principal or equity thereon (and without adjustment by reason of the
financial condition of such other Person) and shall, if made by the
transfer or exchange of property other than cash, be deemed to have
been made in an original principal or capital amount equal to the fair
market value of such property at the time of transfer.
"Issuing Bank" shall have the meaning given to that term in
subsection 2.1.11(a).
"Joint Venture Collateral" means (i) the Collateral (as that
term is defined in the Security Agreement Joint Venture Subsidiary
Borrower), (ii) the Receivables (as that term is defined in the
Security Agreement - Joint Venture Subsidiary Borrower), (iii) the
Financed Receivables (as that term is defined in the Security Agreement
Joint Venture Subsidiary Borrower), (iv) the Proceeds (as that term is
defined in the Security Agreement - Joint Venture Subsidiary Borrower),
and (v) the Net Proceeds (as that term is defined in the Security
Agreement - Joint Venture Subsidiary Borrower).
"Joint Venture Interest" means any interests in any joint
venture, partnership or trust which are, at the time, either directly
or indirectly, owned by any Borrower, and which are more than fifty
percent (50%) of all of the outstanding interests of such joint
venture, partnership or trust.
"Joint Venture Subsidiary Borrower" means any joint venture
or partnership which is a Subsidiary.
"Joint Venturer" shall have the meaning given to that term in
subsection 10.22(b).
"Kentucky Conditional Assignment of Rentals" means the
Conditional Assignment of Rentals, Profits and Income, to be executed
and delivered by Fine Host, substantially in the form attached hereto
as Exhibit N, as the same may be amended, modified, supplemented, or
restated, from time to time.
"Kentucky Mortgage" means the Mortgage, Security Agreement and
Financing Statement, to be executed and delivered by Fine Host,
substantially in the form attached hereto as Exhibit M, as the same may
be amended, modified, supplemented, or restated, from time to time.
"Kentucky Property" means the real property and all of the
buildings and improvements located thereon, which are commonly known as
the Palace Theatre, located at Fourth Street, Louisville, Jefferson
County, Kentucky, all as more particularly described in the Kentucky
Mortgage.
"Law" means any law (including common law), constitution,
statute, treaty, regulation, rule, ordinance, order, injunction, writ,
decree, judgment or award of any governmental body (including, without
limitation, any court or any administrative or regulatory agency).
"L/C Commitment" means Ten Million and 00/100 Dollars
($10,000,000.00).
"L/C Fee Payment Date" means the last day of each fiscal
quarter of Fine Host and the Working Capital Maturity Date.
"L/C Obligations" means at any time, an amount equal to the
sum of (a) the aggregate then undrawn and unexpired amount of the then
outstanding Letters of Credit and (b) the aggregate amount of drawings
under Letters of Credit which have not been reimbursed pursuant to
subsection 2.1.15.
"Letters of Credit" means collectively Commercial Letters of
Credit and Standby Letters of Credit.
"Liabilities" means all of the liabilities, obligations, and
indebtedness of any of the Borrowers or the Borrower Agent to any of
the Agents, the Banks or the Affiliates of the Banks, of any and every
kind and nature, whether heretofore, now or hereafter owing, arising,
due or payable and howsoever evidenced, created, incurred, or acquired,
whether primary, secondary, direct or indirect, absolute or contingent,
fixed or otherwise (including obligations of performance under and the
requirement to reimburse draws on Letters of Credit) and whether
arising or existing under written agreement or by operation of Law as a
result of the Indebtedness and obligations of any of the Borrowers or
the Borrower Agent to any of the Agents or the Banks under this
Agreement or any of the other Loan Documents, as the same may be
amended, modified, supplemented, restated or extended, from time to
time.
"LIBOR Base Rate" means with respect to each day during each
Interest Period pertaining to a LIBOR Loan, the rate per annum equal to
the average rate at which BankBoston is offered Dollar deposits at or
about 10:00 A.M., Boston, Massachusetts time, two (2) Business Days
prior to the beginning of such Interest Period by prime banks in the
London interbank market where foreign currency and exchange operations
in respect of its LIBOR Loans are then being conducted for delivery on
the first day of such Interest Period for a period comparable to the
number of days comprised therein and in an amount comparable to the
amount of its LIBOR Loan to be outstanding during such Interest Period.
"LIBOR Loans" means Loans the rate of interest applicable to
which is based upon the LIBOR Rate.
"LIBOR Rate" means with respect to each day during each
Interest Period pertaining to a LIBOR Loan, a rate per annum determined
for such day in accordance with the following formula (rounded upward
to the nearest 0.0005%):
LIBOR Base Rate
1.00 - LIBOR Reserve Requirements
"LIBOR Reserve Requirements" means for any day as applied to a
LIBOR Loan, the aggregate (without duplication) of the rates (expressed
as a decimal to the fourth digit) of reserve requirements in effect on
such day (including, without limitation, basic, supplemental, marginal
and emergency reserves under any regulations of the Board of Governors
or other Governmental Authority having jurisdiction with respect,
thereto) prescribed for London interbank market funding (currently
referred to as "LIBOR Liabilities" in Regulation D of the Board of
Governors) maintained by a member bank of the Federal Reserve System
and applicable with respect to such LIBOR Loan.
"License" shall have the meaning given to that term in
subsection 5.16(a).
"Lien" means any mortgage, deed of trust, pledge, lien,
security interest, charge or encumbrance or security arrangement of any
nature whatsoever, whether arising by written agreement or by operation
of Law, including but not limited to any conditional sale or title
retention arrangement, and any assignment, deposit arrangement or lease
intended as, or having the effect of, security.
"LLC Subsidiary Borrower" shall mean any Subsidiary which is a
limited liability company or limited liability partnership.
"Loan" means any Working Capital Loan, Swing Line Loan,
Guidance Loan or the Letters of Credit (whether drawn or undrawn)
issued pursuant to Section 2.1.11(a).
"Loan Documents" means this Agreement, the Notes, the Letters
of Credit, the Security Documents and any and all other agreements,
guaranties, instruments, documents, certificates, financing statements,
powers of attorney, consents and filings, whether heretofore, now, or
hereafter executed by or on behalf of any Borrower, any Affiliate of
any Borrower or any other Person and delivered to any of the Agents or
the Banks in connection with the Loans, all as may be amended,
modified, supplemented, restated or extended from time to time.
"Loan Participants" shall have the meaning set forth in
subsection 10.15.2.
"Manage" or "Management" means to generate, handle,
manufacture, process, treat, store, use, re-use, refine, recycle,
reclaim, blend or burn for energy recovery, incinerate, accumulate
speculatively, transport, transfer, dispose of, Release, threaten to
Release or abandon Hazardous Substances.
"Material Adverse Change" or "Material Adverse Effect" means a
material adverse effect on (a) the business, operations, property or
condition (financial or otherwise) of the Borrowers taken as a whole or
(b) the validity or enforceability of this Agreement or any of the
other Loan Documents or the rights or remedies of any of the Agents or
the Banks hereunder or thereunder.
"Membership Interests" means any membership interests in any
limited liability company which are, at the time, either directly or
indirectly, owned by any Borrower, and which are more than fifty
percent (50%) of all of the outstanding membership interests of such
limited liability company.
"Moody's" means Moody's Investors Service, Inc. or any other
entity succeeding to any or all of its functions.
"Multiemployer Plan" means any "multiemployer plan" within the
meaning of Section 3(37) of ERISA and to which any Borrower or any
ERISA Affiliate has or had any obligation to contribute.
"NASDAQ" means the Nasdaq National Market or any other entity
succeeding to any or all of its functions.
"Net Contract Proceeds" means, with respect to the sale,
cancellation, termination or other discontinuation of any Facility
Agreement with any Person at any time, the sum of (a) (i) the gross
cash proceeds received by the Borrowers from or on account of such
Person as a result thereof and, without duplication, (ii) all payments
received by the Borrowers on account of Indebtedness owing to any of
them from such Person (including payments on Notes Receivable) less (b)
(i) all reasonable legal, accounting and other professional fees, costs
and expenses incurred in connection therewith, (ii) all taxes actually
paid or estimated by the Borrowers (in good faith) to be payable in
connection therewith and (iii) all payments made at such time (and not
at any earlier time) by the Borrowers to such Person in order to repay
or otherwise retire Indebtedness incurred in connection with such
Facility Agreement.
"Net Proceeds" means with respect to any Person, (a) with
respect to any Asset Sale by such Person, the cash proceeds (including
any cash payments received by way of deferred payment of principal
pursuant to a note or installment receivable or purchase price
adjustment receivable or otherwise, but only as and when received) of
such Asset Sale net of (i) attorneys' fees, accountants' fees,
investment banking fees, survey costs, title insurance premiums, and
related search and recording charges, transfer taxes, deed or mortgage
recording taxes, required debt payments (other than pursuant hereto),
other customary expenses, amounts required to be applied to the
repayment of obligations secured by a Lien permitted hereunder on any
asset which is the subject of such Asset Sale (other than any Lien in
favor of the Administrative Agent for the ratable benefit of the Banks)
and brokerage, consultant and other customary fees actually incurred in
connection therewith and (ii) taxes paid or payable as a result thereof
and (b) with respect to any issuance of equity securities or the
incurrence of any Indebtedness by such Person subsequent to the Closing
Date, the cash proceeds received from such issuance or incurrence net
of investment banking fees, legal fees, accountants' fees, underwriting
discounts and commissions and other customary fees and expenses and
other reasonable costs and expenses actually incurred in connection
therewith.
"New Project" shall mean any of the following: (a) a facility
not previously serviced by a Borrower, (b) a material expansion of the
size of a facility or scope of service for a facility under a Facility
Agreement, (c) the extension of any Facility Agreement then being
serviced by a Borrower, or (d) any existing facility Agreement which is
put out for bid by the other parties thereto and for which a Borrower
bids successfully at the end of its term.
"New Lending Office" shall have the meaning given to that term
in subsection 3.10(b).
"Non-Excluded Taxes" shall have the meaning given to that term
in subsection 3.10(a).
"Notes" means the Working Capital Notes, the Swing Line Note
and the Guidance Notes.
"Notes Receivable" means any promissory note (or related bond
or letter of credit), or similar agreement or arrangement by any Person
to pay money to any Borrower under the terms of or in connection with a
Facility Agreement.
"Ongoing Investments" shall have the meaning given to that
term in subsection 7.7.
"PBGC" means the Pension Benefit Guaranty Corporation
established under Title IV of ERISA or any other governmental agency,
department or instrumentality succeeding to the functions of said
corporation.
"Permitted Acquisition" shall mean the acquisition of any
concession, license, management or other food, beverage or
complementary services agreement by a Borrower directly or indirectly
through the purchase of stock (or other ownership interests) or assets
of another Person.
"Person" means any individual, sole proprietorship,
partnership, limited liability company, joint venture, trust,
unincorporated organization, association, corporation, institution,
entity, party, or government (whether national, federal, state,
provincial, county, city, municipal or otherwise, including without
limitation any instrumentality, division, agency, body or department
thereof).
"Pledge Agreement - Joint Venture Interest" means the Amended
and Restated Pledge Agreement - Joint Venture Interest, to be executed
and delivered by Fine Host, substantially in the form attached hereto
as Exhibit J, as the same may be amended, modified, supplemented, or
restated, from time to time.
"Pledge Agreement - Membership Interest" means the Amended and
Restated Pledge Agreement - Membership Interest, to be executed and
delivered by Fine Host, substantially in the form attached hereto as
Exhibit K, as the same may be amended, modified, supplemented, or
restated, from time to time.
"Pledge Agreement - Stock" means an Amended and Restated
Pledge Agreement - Stock, to be executed and delivered by each Borrower
which, either directly or indirectly, is the legal and record owner of
Capital Stock in any other Borrower, substantially in the form attached
hereto as Exhibit L, as the same may be amended, modified,
supplemented, or restated, from time to time.
"Pledge Agreements" means collectively the Pledge Agreements -
Stock, the Pledge Agreements - Joint Venture Interest and the Pledge
Agreements - Membership Interest.
"Plan" means any employee pension or benefit plan (other than
a Multiemployer Plan) to which Section 4021(a) of ERISA applies and (a)
which is maintained for employees of any Borrower or any of its ERISA
Affiliates; or (b) to which any Borrower or any of its ERISA Affiliates
made, or was required to make, contributions at any time within the
preceding five years.
"Prepayment Account" shall have the meaning given to that
term in subsection 3.1(c).
"Prohibited Transaction" means with respect to any Plan any
transaction described in Section 406 of ERISA which is not exempt by
reason of Section 408 of ERISA or the transitional rules set forth in
Section 414(c) of ERISA and any transaction described in Section
4975(c)(1) of the Tax Code which is not exempt by reason of Section
4975(c)(2) or Section 4975(d) of the Tax Code, or the transitional
rules of Section 2003(c) of ERISA.
"Project Costs" means, with respect to any New Project or
Permitted Acquisition, the sum (without duplication) of the following
items: (a) Capital Expenditures, (b) costs capitalized as contract
rights pursuant to GAAP, (c) Notes Receivable, (d) debt or obligations
of the acquired business or the target company in such Permitted
Acquisition being paid by any of the Borrowers in connection with the
closing of such Permitted Acquisition, (e) amounts treated as goodwill
in accordance with GAAP, (f) Subordinated Debt, if any, incurred in
connection with such New Project or Permitted Acquisition, (g)
unsecured guaranties permitted under subsection 7.3(e) and (h) the fair
market value of all consideration paid or payable to the seller or
sellers of a target company in a Permitted Acquisition and not
otherwise included in Project Costs under clauses (a), (b), (c), (d)
(e), (f) and (g) above.
"Register" shall have the meaning set forth in subsection
10.15.4.
"Reimbursement Obligation" means the obligation of the
Borrowers to reimburse the Issuing Bank pursuant to subsection
2.1.15(a) for amounts drawn under Letters of Credit.
"Release" means any actual or threatened spilling, leaking,
pumping, pouring, emitting, emptying, discharging, injection, escaping,
leaching, dumping or disposing of Hazardous Substances into the
environment, as the term 'environment' is defined in CERCLA.
"Reportable Event" means (a) a reportable event described in
Section 4043 of ERISA and regulations thereunder, for which the
obligation to give notice to the PBGC has not been waived by the PBGC
in accordance with applicable regulations, (b) a withdrawal by a
substantial employer from a single-employer plan which is a Plan and
which has two or more contributing sponsors at least two of which are
not under common control, as referred to in Section 4063(b) of ERISA,
or (c) a cessation of operations at a facility causing more than twenty
percent of plan participants to be separated from employment, as
referred to in Section 4068(f) of ERISA.
"Required Banks" means at any time, Banks with Commitment
Percentages which aggregate Fifty-One Percent (51%) or more.
"Requirement of Law" means any law, treaty, rule or regulation
or determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or
any of its property or to which such Person or any of its property is
subject.
"Respond" or "Response" means any action taken pursuant to
Environmental Laws to correct, remove, remediate, clean up, prevent,
mitigate, monitor, evaluate, investigate or assess the Release of a
Hazardous Substance.
"SEC" means the United States Securities and Exchange
Commission or any other federal governmental agency which may hereafter
perform its functions.
"Securities Laws" shall have the meaning given to that term
in subsection 5.21.
"Security Agreement - Fine Host" means the Amended and
Restated Security Agreement All Property, to be executed and delivered
by Fine Host, substantially in the form attached hereto as Exhibit D,
as the same may be amended, modified, supplemented, or restated, from
time to time.
"Security Agreement - Joint Venture Subsidiary Borrower" means
the Amended and Restated Security Agreement All Property, to be
executed and delivered by each Joint Venture Subsidiary Borrower,
substantially in the form attached hereto as Exhibit E, as the same may
be amended, modified, supplemented, or restated, from time to time.
"Security Agreement - Subsidiary Borrower" means the Amended
and Restated Security Agreement - All Property, to be executed and
delivered by each Subsidiary Borrower (other than each Subsidiary
Borrower which is a Joint Venture Subsidiary Borrower), substantially
in the form attached hereto as Exhibit F, as the same may be amended,
modified, supplemented, or restated, from time to time.
"Security Agreements" means the Security Agreement - Fine
Host, the Security Agreements - Joint Venture Subsidiary Borrower and
the Security Agreements - Subsidiary Borrower.
"Security Documents" means collectively, the Security
Agreements, the Assignments of Receivables and Proceeds, the Pledge
Agreements, the Kentucky Mortgage, the Kentucky Conditional Assignment
of Rentals and all other security documents hereafter delivered to the
Administrative Agent granting a Lien on any asset or assets of any
Person to secure the Liabilities, including without limitation such
documents delivered pursuant to subsection 6.12.
"Special Texas Corporations" means (a) Convention Beverages,
Inc., a Texas corporation, (b) Fine Host of Texas, Inc., a Texas
corporation, and (c) each other company incorporated under the laws of
the State of Texas in which Fine Host enters into an arrangement, on
terms reasonably satisfactory to the Administrative Agent, for
substantially the same purpose that it has entered into Texas
Management Agreements with the corporations referred to in clauses (a)
and (b) of this definition.
"Standard & Poor's" means Standard & Poor's Corporation or any
other entity succeeding to any or all of its functions.
"Standby Letter of Credit" shall have the meaning given to
that term in subsection 2.1.11(b).
"Subordinated Debt" means liabilities, if any, of any Borrower
which are subordinated to the Liabilities upon such terms and
conditions as are satisfactory to the Required Banks in their sole
discretion (it being acknowledged and agreed that subordination
provisions substantially on the terms and conditions set forth in Annex
D shall satisfy this requirement), and which arise or are otherwise
incurred in connection with any Permitted Acquisition, such liabilities
to include, without limitation, all such Indebtedness of the Borrowers
described in Schedule 5.25, as supplemented quarterly by an Acceptable
Supplement, in accordance with the provisions of subsection 5.25.
"Subordinated Debt Documents" means all documents evidencing,
securing, or related to the Subordinated Debt.
"Subsidiary" means, at any time, any corporation of which at
least fifty percent (50%) of the issued and outstanding capital stock
having ordinary voting power to elect a majority of the board of
directors or other governing body of such corporation (irrespective of
whether at the time stock of any other 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, directly or indirectly,
owned by Fine Host, or any limited liability company, limited liability
partnership, joint venture or similar entity of which more than fifty
percent (50%) of the outstanding equity interests is at the time,
directly or indirectly, owned by Fine Host.
"Subsidiary Borrower" means any Borrower that is a Subsidiary.
"Swing Line Bank" shall have the meaning given to that term
in subsection 2.1.7.
"Swing Line Commitment" means the obligation of the Swing Line
Bank to make Swing Line Loans pursuant to subsection 2.1.7 in an
aggregate amount at any one time outstanding not to exceed Five Million
and 00/100 Dollars ($5,000,000.00).
"Swing Line Loans" shall have the meaning given to that term
in subsection 2.1.7.
"Swing Line Note" shall have the meaning given to that term
in subsection 2.1.8(e).
"Swing Line Participation Amount" shall have the meaning
given to that term in subsection 2.1.10(b).
"Tax Code" means the Internal Revenue Code of 1986, as
amended, and any successor statute of similar import, and rules and
regulations thereunder, in each case as in effect from time to time.
References to sections of the Tax Code shall be construed to refer to
any successor sections as well.
"Texas Management Agreements" means, collectively, the
Management Services Agreement, dated May 20, 1992, between Convention
Beverages, Inc. and Fine Host and the Management Services Agreement,
dated January 31, 1991, between Fine Host of Texas, Inc. and Fine Host,
and each other management services agreement, reasonably satisfactory
to the Administrative Agent, entered into with any corporation referred
to in clause (c) of the definition of Special Texas Corporations, as
each of such agreements may be amended, modified, supplemented,
restated or extended from time to time.
"Transferee" means any Loan Participant or Assignee.
"Type" means as to any Loan, its nature as an ABR Loan or a
LIBOR Loan.
"UCC" means the Uniform Commercial Code of the Commonwealth of
Massachusetts (or with respect to Collateral in which a Lien may only
be perfected pursuant to the laws of any other state or the District of
Columbia, the Uniform Commercial Code of such state or of the District
of Columbia), as amended, and any successor statute of similar import
as in effect from time to time.
"Uniform Customs" means the Uniform Customs and Practice for
Documentary Credits (1993 Revision), International Chamber of Commerce
Publication No. 500, as the same may be amended from time to time.
"Working Capital Commitment" means as to any Bank, its
obligation to make a Working Capital Loan to the Borrower Agent in an
amount equal to the amount set forth opposite such Bank's name in Annex
B under the heading "Working Capital Commitment ", as such amount may
be reduced from time to time pursuant to subsection 2.1.5;
collectively, as to all the Banks, the "Working Capital Commitments".
The maximum principal amount of all of the Working Capital Commitments
shall not, at any time, exceed Fifty Million and 00/100 Dollars
($50,000,000.00).
"Working Capital Commitment Percentage" means as to any Bank
at any time, the percentage which (i) the sum of (a) such Bank's then
unused Working Capital Commitment plus (b) such Bank's Working Capital
Loans then outstanding plus (c) the product of the percentage of the
Working Capital Commitments of all of the Banks then constituted by
such Bank's Working Capital Commitments times the sum of (I) the Swing
Line Loans then outstanding and (II) the L/C Obligations then
outstanding then constitutes of (ii) the sum of (w) the aggregate
outstanding then unused Working Capital Commitments of all of the Banks
plus (x) the aggregate principal amount of Working Capital Loans of all
of the Banks then outstanding plus (y) the aggregate L/C Obligations
then outstanding plus (z) the aggregate principal amount of the Swing
Line Loans then outstanding.
"Working Capital Commitment Period" means the period from and
after the Closing Date to and including the Working Capital Maturity
Date or such earlier date on which the Working Capital Commitments
shall terminate as
provided herein.
"Working Capital Fee Rate" shall have the meaning given to
that term in subsection 2.1.13(a).
"Working Capital Loans" shall have the meaning given to that
term in subsection 2.1.1(a).
"Working Capital Maturity Date" means the fifth anniversary
of the Closing Date.
"Working Capital Notes" shall have the meaning given to that
term in subsection 2.1.6(e).
1.2 Accounting TermsAccounting Terms. Any accounting terms used in this
Agreement which are not specifically defined herein shall have the meanings
customarily given to such terms in accordance with GAAP.
1.3 Other Terms Defined in the UCCOther Terms Defined in the UCC. All
terms contained in this Agreement (and which are not otherwise specifically
defined herein) shall have the meanings provided by the UCC to the extent the
same are used or defined therein.
1.4 ConstructionConstruction. Unless the context of this Agreement
otherwise clearly requires, references to the plural include the singular,
references to the singular include the plural, the term "including" is not
limiting, and the term "or" has the inclusive meaning represented by the phrase
"and/or". The terms "hereof," "herein," "hereunder" and similar terms in this
Agreement refer to this Agreement as a whole and not to any particular provision
of this Agreement. Section, subsection, clause, exhibit and schedule references
are to this Agreement unless otherwise specified.
2. LOANS AND LETTERS OF CREDITLOANS AND LETTERS OF CREDIT.
2.1 Working Capital LoansWorking Capital Loans.
2.1.1 Working Capital CommitmentWorking Capital Commitment.
(a) Subject to the terms and conditions hereof, each Bank
severally agrees to make revolving credit loans (such loans are
hereinafter sometimes referred to collectively as the "Working Capital
Loans" and each singly as a "Working Capital Loan" and do not include
any of the Swing Line Loans) to the Borrower Agent from time to time
during the Working Capital Commitment Period in an aggregate principal
amount at any one time outstanding which, when added to such Bank's
Working Capital Commitment Percentage of (i) the then outstanding Swing
Line Loans and (ii) the then outstanding L/C Obligations, does not
exceed the amount of such Bank's Working Capital Commitment. During the
Working Capital Commitment Period, the Borrower Agent may use the
Working Capital Commitments by borrowing, prepaying the Working Capital
Loans in whole or in part, and reborrowing, all in accordance with the
terms and conditions hereof. Notwithstanding any provision contained in
this Agreement or any of the other Loan Documents to the contrary, the
entire outstanding balance of all of the Working Capital Loans
(including without limitation, all unpaid principal, all accrued but
unpaid interest and all unpaid fees, charges, costs and expenses) shall
be due and payable in full on the Working Capital Maturity Date.
(b) The Working Capital Loans may from time to time be (i)
LIBOR Loans, (ii) ABR Loans or (iii) a combination thereof, as
determined by the Borrower Agent and notified to the Administrative
Agent in accordance with subsections 2.1.2 and 3.2; provided, however,
that during the first three (3) Business Days following the Closing
Date, no Working Capital Loan shall be a LIBOR Loan; and further
provided, that, no Working Capital Loan shall be made as a LIBOR Loan
after the day that is one (1) month prior to the Working Capital
Maturity Date.
2.1.2 Procedure for Working Capital Borrowing. The Borrower
Agent may borrow under the Working Capital Commitments during the
Working Capital Commitment Period on any Business Day; provided,
however, that the Borrower Agent shall, upon the request of the
Administrative Agent, give the Administrative Agent irrevocable notice
(which notice must be received by the Administrative Agent prior to
12:00 Noon, Boston, Massachusetts time, (a) three (3) Business Days
prior to the requested Borrowing Date, if all or any part of the
requested Working Capital Loans are to be initially LIBOR Loans, or
(b) prior to 12:00 Noon, Boston, Massachusetts time, one (1) Business
Day prior to the requested Borrowing Date, if all of the Working
Capital Loans to be made on such date are to be ABR Loans), specifying
(i) the amount to be borrowed and (ii) if the borrowing is to be
entirely or partly of LIBOR Loans, the respective amounts of each Type
of Loan and the lengths of the initial Interest Periods for each such
LIBOR loan. Each borrowing under the Working Capital Commitments shall
be in an amount equal to (x) in the case of ABR Loans, $1,000,000 or a
whole multiple of $500,000 in excess thereof (or, if the then
available Working Capital Commitments are less than $1,000,000, such
lesser amount) and (y) in the case of LIBOR Loans, $1,000,000 or a
whole multiple of $500,000 in excess thereof. Upon receipt of any such
notice from the Borrower Agent, the Administrative Agent shall
promptly notify each Bank thereof. Each Bank will make the amount of
its pro rata share of each borrowing available to the Administrative
Agent for the account of the Borrower Agent at the office of the
Administrative Agent specified in subsection 10.12 prior to 12:00
Noon, Boston, Massachusetts time, on the Borrowing Date requested by
the Borrower Agent in funds immediately available to the
Administrative Agent. Such borrowing will then be made available to
the Borrower Agent by the Administrative Agent crediting the account
of the Borrower Agent on the books of such office prior to 1:00 P.M.,
Boston, Massachusetts time, on such Borrowing Date with the aggregate
of the amounts made available to the Administrative Agent by the Banks
and in like funds as received by the Administrative Agent.
2.1.3 Use of Working Capital Proceeds. The proceeds of the
Working Capital Loans shall be made available by the Borrower Agent to
one or more of the Borrowers, as determined by the Borrower Agent, to
be used solely for the general corporate purposes of the Borrowers in
the ordinary course of their business, but in no event shall such
proceeds be used for the payment of any of the following: (i) the
payment of principal on any loan (other than the reimbursement of any
Letter of Credit under subsection 2.1.15), whether to the Banks or any
other Person; (ii) Project Costs funded by the proceeds of a Guidance
Loan; or (iii) distributions or payments which are prohibited or
restricted (including payments which require the Banks to authorize
such payments and which have not been authorized) under the terms of
this Agreement.
2.1.4 Commitment Fee. The Borrowers agree to pay to the
Administrative Agent for the account of each Bank a commitment fee for
the period from and including the first day of the Working Capital
Commitment Period to the Working Capital Maturity Date, computed at
the rate of .225% per annum on the average daily amount of the unused
Working Capital Commitment of such Bank (including, without
limitation, that portion of the unused Working Capital Commitment of
such Bank that is available to the Borrower for Swing Line Loans)
during the period for which payment is made, payable quarterly in
arrears on the fifteenth day of the month following the end of each
fiscal quarter ending after the Closing Date, and on the Working
Capital Maturity Date or such earlier date as the Working Capital
Commitments shall terminate as provided herein, commencing on the
first of such dates to occur after the date hereof; provided, however,
that, from and after September 24, 1997, the commitment fee will be
adjusted, on each Adjustment Date based upon the ratio of Consolidated
Debt at the last day of the 12 month period ended on the date of the
financial statements relating to such Adjustment Date to the Adjusted
Consolidated EBITDA for such period as determined from such financial
statements, to the commitment fee set forth on Annex A attached hereto
opposite the level for which the ratio of Consolidated Debt to
Adjusted Consolidated EBITDA as so determined satisfies the
corresponding criteria set forth under the heading "Ratio of
Consolidated Debt to Adjusted Consolidated EBITDA."
2.1.5 Termination or Reduction of Commitments. The Borrower
Agent shall have the right, upon not less than ten (10) Business Days'
prior notice to the Administrative Agent, to terminate the Working
Capital Commitments or, from time to time, to reduce the amount of the
Working Capital Commitments, provided that no such termination or
reduction shall be permitted if, after giving effect thereto and to
any prepayments of the Working Capital Loans made on the effective
date thereof, the aggregate principal amount of the Working Capital
Loans then outstanding, when added to the then outstanding L/C
Obligations and Swing Line Loans, would exceed the Working Capital
Commitments then in effect. Any such reduction shall be in an amount
equal to $1,000,000 or a whole multiple of $500,000 in excess thereof
and shall reduce permanently the Working Capital Commitments then in
effect.
2.1.6 Repayment of Working Capital Loans; Evidence of Debt.al
Loans; Evidence of Debt
(a) The Borrowers hereby unconditionally promise to pay to the
Administrative Agent for the account of each Bank the then unpaid
principal amount of each Working Capital Loan of such Bank on the
Working Capital Maturity Date (or such earlier date on which the
Working Capital Loans become due and payable pursuant to Section 8.1).
The Borrowers hereby further agree to pay interest on the unpaid
principal amount of the Working Capital Loans from time to time
outstanding from the date hereof until payment in full thereof at the
rates per annum, and on the dates, set forth in subsection 3.4.
(b) The Administrative Agent shall record in the Register,
with separate subaccounts for each Bank, (i) the amount and Borrowing
Date of each Working Capital Loan made hereunder, the Type thereof and
each Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from
the Borrowers to each Bank hereunder and (iii) both the amount of any
sum received by the Administrative Agent hereunder from the Borrowers
and each Bank's share thereof.
(c) The entries made in the Register pursuant to subsection
2.1.6(b) shall, to the extent permitted by applicable law, be prima
facie evidence of the existence and amounts of the obligations of the
Borrowers therein recorded; provided, however, that the failure of the
Administrative Agent to maintain the Register, or any error therein,
shall not in any manner affect the obligation of the Borrowers to repay
(with applicable interest) the Working Capital Loans made by each Bank
in accordance with the terms of this Agreement.
(d) On the Closing Date, the Borrowers will execute and
deliver to the Administrative Agent certain Working Capital Notes, each
dated as of the Closing Date, from the Borrowers, evidencing the
Working Capital Loans of each Bank, each substantially in the form of
Exhibit A, with appropriate insertions as to the name and address of
such Bank, the date and principal amount (a "Working Capital Note").
Each Bank is hereby authorized to record the date and amount of each
Working Capital Loan made by such Bank and the date and amount of each
payment or prepayment of principal thereof on the schedule annexed to
and constituting a part of the Working Capital Note, and any such
recordation shall, to the extent permitted by applicable law,
constitute prima facie evidence of the accuracy of the information so
recorded; provided, however, that the failure to make any such
recordation (or any error therein) shall not affect the obligation of
the Borrowers to repay (with applicable interest) the Working Capital
Loans made by such Bank in accordance with the terms of this Agreement.
2.1.7 Swing Line Commitment. Subject to the terms and
conditions hereof, BankBoston (in such capacity, the "Swing Line
Bank") agrees to make a portion of the Working Capital Commitments
available to the Borrower Agent during the Working Capital Commitment
Period by making swing line loans (such loans are hereinafter
sometimes referred to collectively as the "Swing Line Loans" and each
singly as a "Swing Line Loan" and do not include any of the Working
Capital Loans) to the Borrower Agent in an aggregate principal amount
not to exceed at any one time outstanding the Swing Line Commitment;
provided however, that (a) the aggregate principal amount of Swing
Line Loans outstanding at any time shall not exceed the Swing Line
Commitment then in effect and (b) the Borrower Agent shall not
request, and the Swing Line Bank shall not make, any Swing Line Loan
if, after giving effect to the making of such Swing Line Loan, the
Aggregate Working Capital Outstandings of all of the Banks would
exceed the Working Capital Commitments at such time. During the
Working Capital Commitment Period, the Borrower Agent may use the
Swing Line Commitment by borrowing, repaying and reborrowing Swing
Line Loans, all in accordance with the terms and conditions hereof.
Swing Line Loans may be ABR Loans only. To the extent not otherwise
prohibited under this Agreement, the Borrower Agent may convert any
Swing Line Loan to a Working Capital Loan by delivering a written
notice thereof to the Swing Line Bank.
2.1.8 Repayment of Swing Line Loans; Evidence of Debt.ne
Loans; Evidence of Debt
(a) The Borrowers hereby unconditionally promise to pay to the
Administrative Agent for the account of the Swing Line Bank the then
unpaid principal amount of the Swing Line Loans on the Working Capital
Maturity Date (or such earlier date on which the Swing Line Loans
become due and payable pursuant to Section 8.1). The Borrowers hereby
further agree to pay to the Swing Line Bank interest on the unpaid
principal amount of the Swing Line Loans from time to time outstanding
from the date hereof until payment in full thereof at the rates per
annum, and on the dates, set forth in subsection 3.4. No Bank (other
than the Swing Line Bank) shall have any right to receive payments of
interest on the Swing Line Loan.
(b) The Swing Line Bank shall maintain in accordance with its
usual practice an account or accounts evidencing indebtedness of the
Borrowers to the Swing Line Bank resulting from the Swing Line Loans
made by the Swing Line Bank from time to time, including the amounts of
principal and interest payable and paid to the Swing Line Bank from
time to time under this Agreement.
(c) The Administrative Agent shall record in the Register (i)
the amount and Borrowing Date of each Swing Line Loan made hereunder,
(ii) the amount of any principal or interest due and payable or to
become due and payable from the Borrowers to the Swing Line Bank
hereunder and (iii) the amount of any sum received by the
Administrative Agent hereunder in respect of Swing Line Loans.
(d) The entries made in the Register pursuant to subsection
2.1.8(c) shall, to the extent permitted by applicable law, be prima
facie evidence of the existence and amounts of the obligations of the
Borrowers therein recorded; provided, however, that the failure of the
Swing Line Bank or the Administrative Agent to maintain the Register,
or any error therein, shall not in any manner affect the obligation of
the Borrowers to repay (with applicable interest) the Swing Line Loans
made by the Swing Line Bank in accordance with the terms of this
Agreement.
(e) On the Closing Date, the Borrowers shall execute and
deliver to the Swing Line Bank a certain Swing Line Note, dated as of
the Closing Date, from the Borrowers, evidencing each Swing Line Loan
of the Swing Line Bank, substantially in the form of Exhibit B, with
appropriate insertion as to date (a "Swing Line Note"). The Swing Line
Bank is hereby authorized to record the date and amount of each Swing
Line Loan made by the Swing Line Bank and the date and amount of each
payment or prepayment of principal thereof on the schedule annexed to
and constituting a part of the Swing Line Note, and any such
recordation shall, to the extent permitted by applicable law,
constitute prima facie evidence of the accuracy of the information so
recorded; provided, however, that the failure to make any such
recordation (or any error therein) shall not affect the obligation of
the Borrowers to repay (with applicable interest) the Swing Line Loans
made by the Swing Line Bank in accordance with the terms of this
Agreement.
2.1.9 Procedurefor Borrowing Swing Line Loans. Whenever the
Borrower Agent desires the Swing Line Bank to make a Swing Line Loan
under subsection 2.1.7, it shall, upon the request of the Swing Line
Bank, give the Swing Line Bank irrevocable telephonic notice confirmed
promptly in writing (which telephonic notice must be received by the
Swing Line Bank not later that than 12:00 Noon, Boston, Massachusetts
time, on the proposed Borrowing Date), specifying (i) the amount to be
borrowed and (ii) the requested Borrowing Date (which shall be a
Business Day during the Working Capital Commitment Period). Not later
than 1:00 p.m. Boston, Massachusetts time, on the Borrowing Date
specified in a notice requesting a Swing Line Loan, the Swing Line
Bank shall make available to the Administrative Agent for the account
of the Borrower Agent at the office of the Administrative Agent
specified in subsection 10.12 an amount in immediately available funds
equal to the amount of the Swing Line Loan to be made by the Swing
Line Bank. The Administrative Agent shall make the proceeds of such
Swing Line Loan available to the Borrower Agent not later than 2:00
p.m., Boston, Massachusetts time, on such Borrowing Date by crediting
the account of the Borrower Agent, on the books of such office, with
such proceeds in immediately available funds.
2.1.10 Swing Line Loan Participants.
(a) Notwithstanding anything herein to the contrary, the Swing
Line Bank shall not be obligated to make any Swing Line Loans if a
Default or an Event of Default shall have occurred and be continuing on
the Borrowing Date specified in a notice requesting a Swing Line Loan.
The Swing Line Bank shall notify the Borrower Agent of its election
under this subsection 2.1.10 not to make any Swing Line Loans.
(b) Each Bank shall purchase an undivided participating
interest in an amount equal to such Bank's Working Capital Commitment
Percentage of the aggregate principal amount of Swing Line Loans then
outstanding (the "Swing Line Participation Amount") on the earlier of
the following dates: (i) the date on which any Event of Default shall
have occurred, or (ii) the date on which the Swing Line Bank delivers
to such Bank a written notice requesting such purchase. On the date of
such purchase, each Bank shall deliver to the Swing Line Bank, in
immediate available funds, such Swing Line Loan Participation Amount.
(c) Whenever, at any time after the Swing Line Bank has
received from any Bank such Bank's Swing Line Participation Amount, the
Swing Line Bank receives any payment on account of the Swing Line
Loans, the Swing Line Bank will distribute to such Bank its pro rata
share of such payment (appropriately adjusted, in the case of interest
payments, to reflect the period of time during which such Bank's
participating interest was outstanding and funded); provided, however,
that in the event that such payment received by the Swing Line Bank is
required to be returned, such Bank will return to the Swing Line Bank
any portion thereof previously distributed to it by the Swing Line
Bank.
(d) Each Bank's obligation to purchase participating interests
pursuant to subsection 2.1.10(b) shall be absolute and unconditional
and shall not be affected by any circumstance, including, without
limitation, (i) any set-off, counterclaim, recoupment, defense or other
right which such Bank or any of the Borrowers may have against the
Swing Line Bank, any of the Borrowers or any other Person for any
reason whatsoever; (ii) the occurrence or continuance of a Default or
an Event of Default; (iii) any adverse change in the condition
(financial or otherwise) of the Borrowers; (iv) any breach of this
Agreement or any other Loan Document by any other Bank; or (v) any
other circumstance, happening or event whatsoever, whether or not
similar to any of the foregoing.
2.1.11 Letter of Credit Commitment. tter of Credit Commitment
(a) Subject to the terms and conditions hereof, BankBoston (in
such capacity, the "Issuing Bank"), in reliance on the agreements of
the other Banks set forth in subsection 2.1.14(a), agrees to issue
Letters of Credit for the account of the Borrower Agent on any Business
Day during the Working Capital Commitment Period in such form as may be
approved from time to time by the Issuing Bank; provided however, that
the Issuing Bank shall have no obligation to, and shall not, issue any
Letter of Credit if, after giving effect to such issuance, (i) the L/C
Obligations would exceed the L/C Commitment or (ii) the Available
Working Capital Commitments would be less than zero. Letters of Credit
issued under the Existing Credit Agreement and outstanding as of the
Closing Date shall be deemed to be issued under this Agreement on the
Closing Date by the Issuing Bank and shall be Letters of Credit for all
purposes of this Agreement.
(b) Each Letter of Credit shall: (i) be denominated in Dollars
and shall be either (x) a standby letter of credit issued to support
obligations of any of the Borrowers, contingent or otherwise, in
connection with its working capital and business needs (a "Standby
Letter of Credit") or (y) a commercial letter of credit issued in
respect of the purchase of goods or services by any of the Borrowers in
the ordinary course of business (a "Commercial Letter of Credit"); and
(ii) expire no later than thirty (30) calendar days prior to the
Working Capital Maturity Date. Notwithstanding any provision contained
herein to the contrary, the proceeds of draws on any Letter of Credit
shall not be used, directly or indirectly, for any of the following
purposes: (i) the payment of principal, interest, or charges on any
loan, whether to the Banks or any other Person; (ii) for repayment of
the Working Capital Loans or the Guidance Loans; or (iii) distributions
or payments which are prohibited or restricted (including payments
which require the Banks to authorize such payments) under the terms of
this Agreement.
(c) Each Letter of Credit shall be subject to the Uniform
Customs and, to the extent not inconsistent therewith, the laws of The
Commonwealth of Massachusetts.
(d) The Issuing Bank shall not at any time be obligated to
issue any Letter of Credit hereunder if such issuance would conflict
with, or cause the Issuing Bank or any Bank to exceed any limits
imposed by, any applicable law.
2.1.12 Procedurefor Issuance of Letter of Credit. The
Borrower Agent may from time to time request that the Issuing Bank
issue a Letter of Credit by delivering to the Issuing Bank at its
address for notices specified in subsection 10.12 an Application
therefor, completed to the satisfaction of the Issuing Bank, and such
other certificates, documents and other papers and information as the
Issuing Bank may reasonably request. The Issuing Bank shall notify the
Banks promptly of the receipt of any request pursuant to the
immediately preceding sentence. Upon receipt of any Application, the
Issuing Bank will process such Application and the certificates,
documents and other papers and information delivered to it in
connection therewith in accordance with its customary procedures and
shall promptly issue the Letter of Credit requested thereby by issuing
the original of such Letter of Credit to the beneficiary thereof or as
otherwise may be agreed between the Issuing Bank and the Borrower
Agent. The Issuing Bank shall furnish a copy of such Letter of Credit
to the Administrative Agent and the Borrower Agent promptly following
the issuance thereof.
2.1.13 Fees, Commissions and Other Charges.missions and Other
Charges
(a) On each L/C Fee Payment Date, the Borrower Agent shall pay
to the Administrative Agent, for the account of the Banks, a letter of
credit fee with respect to each Letter of Credit, computed for the
period from the date of issuance of such Letter of Credit or the
immediately preceding L/C Fee Payment Date, as the case may be, at the
rate of .75% per annum (the "Working Capital Fee Rate"), calculated on
the basis of a 360-day year for actual days elapsed, on the weighted
average amount available to be drawn under such Letter of Credit during
the relevant period, to be shared ratably among the Banks in accordance
with their respective Working Capital Commitment Percentages; provided,
however, that from and after September 24, 1997, the Working Capital
Fee Rate shall be equal to the Applicable Margin for LIBOR Loans in
effect from time to time. Such fees shall be payable in arrears on each
L/C Fee Payment Date after the issuance of such Letter of Credit and
shall be nonrefundable.
(b) The Borrowers shall also pay to the Administrative Agent,
for the account of the Issuing Bank, a fronting fee with respect to
each Letter of Credit equal to 0.125% of the face amount available to
be drawn under such Letter of Credit. Such fronting fee shall be due
and payable on the date of issuance of such Letter of Credit and shall
be nonrefundable.
(c) In addition to the foregoing fees, Borrower shall pay or
reimburse the Issuing Bank for such reasonable, normal and customary
costs and expenses as are incurred or charged by the Issuing Bank to
issue, effect payment under, amend or otherwise administer any Letter
of Credit.
(d) The Administrative Agent shall, promptly following its
receipt thereof, distribute to the Issuing Bank and the Banks all fees
and commissions received by the Administrative Agent for their
respective accounts pursuant to this subsection 2.1.13.
2.1.14 L/C Participations..1.14 L/C Participations.
(a) The Issuing Bank irrevocably agrees to grant and hereby
grants to each Bank, and to induce the Issuing Bank to issue Letters of
Credit hereunder, each Bank irrevocably agrees to accept and purchase
and hereby accepts and purchases from the Issuing Bank, on the terms
and conditions hereinafter stated, for such Bank's own account and risk
an undivided interest equal to such Bank's Working Capital Commitment
Percentage in the Issuing Bank's obligations and rights under each
Letter of Credit issued hereunder and the amount of each draft paid by
the Issuing Bank under such Letter of Credit. Each Bank unconditionally
and irrevocably agrees with the Issuing Bank that, if a draft is paid
under any Letter of Credit for which the Issuing Bank is not reimbursed
in full by the Borrowers in accordance with the terms of this
Agreement, such Bank shall pay to the Issuing Bank upon demand at the
Issuing Bank's address for notices specified in subsection 10.12 an
amount equal to such Bank's Working Capital Commitment Percentage of
the amount of such draft, or any part thereof, which is not so
reimbursed.
(b) Whenever, at any time after the Issuing Bank has made
payment under any Letter of Credit and has received from any Bank its
pro rata share of such payment in accordance with subsection 2.1.14(a),
the Issuing Bank receives any payment related to such Letter of Credit
(whether directly from the Borrowers or otherwise, including proceeds
of Collateral applied thereto by the Issuing Bank), or any payment of
interest on account thereof, the Issuing Bank will distribute to such
Bank its pro rata share thereof; provided, however, that if any such
payment received by the Issuing Bank shall be required to be returned
by the Issuing Bank, each Bank shall return to the Issuing Bank the
portion thereof previously distributed by the Issuing Bank to such
Bank.
2.1.15 Reimbursement Obligation of the Borrowers. ligation of
the Borrowers
(a) The Issuing Bank shall notify the Borrower Agent promptly
of each draft presented under a Letter of Credit. The Borrowers agree
to reimburse the Issuing Bank on each date on which the Issuing Bank
notifies the Borrower Agent of the date and amount of a draft presented
under any Letter of Credit and paid by the Issuing Bank for the amount
of (i) such draft so paid and (ii) any taxes, fees, charges and other
reasonable costs and expenses incurred by the Issuing Bank in
connection with such payment. Each such payment shall be made to the
Issuing Bank at its address for notices specified in subsection 10.12
in Dollars in immediately available funds.
(b) Interest shall be payable on any and all amounts remaining
unpaid by the Borrowers under this subsection 2.1.15, (i) from the date
the draft presented under the relevant Letter of Credit is paid to the
date on which the Borrowers are required to pay such amounts pursuant
to subsection 2.1.15(a) at the rate which would then be payable on
Working Capital Loans that are ABR Loans and (ii) thereafter if payment
is not timely made by the Borrowers, until payment in full at the rate
which would be payable on overdue Working Capital Loans that are ABR
Loans.
(c) Each draft under any Letter of Credit shall constitute a
request by the Borrower Agent to the Administrative Agent for a
borrowing pursuant to subsection 2.1.2 of ABR Loans in the amount of
such draft (but without any requirement for compliance with the prior
notice provisions of subsection 2.1.2). The Borrowing Date with respect
to such borrowing shall be the date of such draft and each Bank shall
make its Working Capital Commitment Percentage of such borrowing
available to the Administrative Agent on such date to be used to repay
for the account of the Borrower Agent the Reimbursement Obligation
created by such draft. The Issuing Bank shall notify the Banks promptly
of each draft under a Letter of Credit to be reimbursed pursuant to
this subsection 2.1.15(c).
2.1.16 Obligations Absolute
(a) The obligations of the Borrowers under this Section 2.1
shall be absolute and unconditional under any and all circumstances and
irrespective of any set-off, counterclaim or defense to payment which
any of the Borrowers may have or have had against the Issuing Bank, any
Bank or any beneficiary of a Letter of Credit.
(b) The Borrowers acknowledge that neither the Issuing Bank
nor any Bank shall be responsible for, and the Reimbursement
Obligations shall not be affected by, among other things, (i) the
validity or genuineness of documents or of any endorsements thereof,
even though such documents shall in fact prove to be invalid,
fraudulent or forged, (ii) any dispute between or among any Borrower
and any beneficiary of any Letter of Credit or any other party to which
such Letter of Credit may be transferred or (iii) any claims of any
Borrower against any beneficiary of such Letter of Credit or any such
transferee.
(c) The Issuing Bank shall not be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery
of any message or advice, however transmitted, in connection with any
Letter of Credit, except for errors, omissions, interruptions or delays
caused by the Issuing Bank's gross negligence or willful misconduct.
(d) Each Borrower acknowledges that any action taken or
omitted by the Issuing Bank under or in connection with any Letter of
Credit or the related drafts or documents (including any action or
matter referred to in clause (b) or (c) above), if done in the absence
of gross negligence or willful misconduct and in accordance with the
standards of care specified in the Uniform Customs, and to the extent
not inconsistent therewith, the UCC, shall be binding on each such
Borrower, and shall not result in any liability of the Issuing Bank to
any Borrower.
2.1.17 Letter of Credit Payments. If any draft shall be
presented for payment under any Letter of Credit, the Issuing Bank
shall, within a reasonable time after its receipt thereof, examine all
documents purporting to represent a demand for payment under such
Letter of Credit to ascertain that the same appear on their face to be
in conformity with the terms and conditions of such Letter of Credit.
The Issuing Bank shall also promptly notify the Borrower Agent of the
date and amount of such draft. The responsibility of the Issuing Bank
to the Borrower Agent in connection with any draft presented for
payment under any Letter of Credit shall, in addition to any payment
obligation expressly provided for in such Letter of Credit, be limited
to determining that the documents (including such draft) delivered
under such Letter of Credit in connection with such presentment are in
conformity with such Letter of Credit.
2.1.18 Application. To the extent that any provision of any
Application related to any Letter of Credit is inconsistent with the
provisions of this Section 2.1, the provisions of this Section 2.1
shall apply.
2.1.19 QuarterlyReports. The Issuing Bank shall furnish to
each Bank a quarterly report with respect to Letters of Credit issued
or outstanding during such quarter and any drawings thereunder.
2.2 Guidance Loans
2.2.1 Guidance Loan Commitment
(a) Subject to the terms and conditions hereof, each Bank
severally agrees to make revolving credit loans ("Guidance Loans") to
the Borrower Agent from time to time during the Guidance Loan
Commitment Period in an aggregate principal amount at any one time
outstanding which does not exceed the amount of such Bank's Guidance
Loan Commitment. During the Guidance Loan Commitment Period, the
Borrower Agent may use the Guidance Loan Commitments by borrowing and
prepaying the Guidance Loans in whole or in part, and reborrowing,
until the Guidance Loan Conversion Date, all in accordance with the
terms and conditions hereof. Notwithstanding any provision contained in
this Agreement or any of the other Loan Documents to the contrary, the
entire outstanding balance of all of the Guidance Loans (including
without limitation, all unpaid principal, all accrued but unpaid
interest and all unpaid fees, charges, costs and expenses) shall be due
and payable in full on the Guidance Loan Maturity Date.
(b) The Guidance Loans may from time to time be (i) LIBOR
Loans, (ii) ABR Loans or (iii) a combination of LIBOR Loans and ABR
Loans, as determined by the Borrower Agent and notified to the
Administrative Agent in accordance with subsections 2.2.2 and 3.2;
provided, however, that during the first three (3) Business Days
following the Closing Date, no Guidance Loan shall be a LIBOR Loan; and
further provided, that no Guidance Loan shall be made as a LIBOR Loan
after the day that is one (1) month prior to the Guidance Loan Maturity
Date.
2.2.2 Procedurefor Guidance Loan Borrowing. The Borrower
Agent may borrow under the Guidance Loan Commitments during the
Guidance Loan Commitment Period on any Business Day; provided,
however, that the Borrower Agent shall, upon the request of the
Administrative Agent, give the Administrative Agent irrevocable notice
(which notice must be received by the Administrative Agent prior
before 12:00 Noon, Boston, Massachusetts time, three (3) Business Days
prior to the requested Borrowing Date, if all or any part of the
requested Guidance Loans are to be LIBOR Loans, or before 12:00 Noon,
Boston, Massachusetts time, one (1) Business Day prior to the
requested Borrowing Date if all of the Guidance Loans to be made on
such date are to be ABR Loans), specifying in each case (i) the amount
to be borrowed, and (ii) if the borrowing is to be entirely or partly
of LIBOR Loans, the amount of each Type of Loan and the lengths of the
initial Interest Period for each such LIBOR Loan. Each borrowing under
the Guidance Loan Commitments shall be in an amount equal to (x) in
the case of ABR Loans, Two Hundred Fifty Thousand and 00/100 Dollars
($250,000.00) or a whole multiple of One Hundred Thousand and 00/100
Dollars ($100,000.00) in excess thereof (or, if the then available
Guidance Loan Commitments are less than One Million and 00/100 Dollars
($1,000,000.00), the entire such lesser amount) and (y) in the case of
LIBOR Loans, One Million and 00/100 Dollars ($1,000,000.00) or a whole
multiple of Five Hundred Thousand and 00/100 Dollars ($500,000.00) in
excess thereof. Upon receipt of any such notice from the Borrower
Agent, the Administrative Agent shall promptly notify each Bank
thereof. Each Bank will make the amount of its pro rata share of each
borrowing available to the Administrative Agent for the account of the
Borrower Agent at the office of the Administrative Agent specified in
subsection 10.12 prior to 12:00 Noon, Boston, Massachusetts time, on
the Borrowing Date requested by the Borrower Agent in funds
immediately available to the Administrative Agent. Such borrowing will
then be made available to the Borrower Agent by the Administrative
Agent crediting the account of the Borrower Agent on the books of the
Administrative Agent at such office prior to 1:00 P.M., Boston,
Massachusetts time, on such Borrowing Date in an amount equal to the
aggregate of the amounts made available to the Administrative Agent by
the Banks and in like funds as received by the Administrative Agent.
2.2.3 Use of Guidance Loan Proceeds. The proceeds of any
Guidance Loan shall be made available by the Borrower Agent to one or
more of the Borrowers, as determined by the Borrower Agent, to be used
by the Borrowers solely for the payment of Project Costs to the extent
permitted under this Agreement, but in no event shall such proceeds be
used for the payment of any of the following: (i) the payment of
principal, interest, or charges on any loan, whether to the Banks or
any other Person; (ii) payment of Working Capital Loans; or (iii)
distributions or payments which are prohibited or restricted
(including payments which require the Banks to authorize such payments
and which have not been authorized) under the terms of this Agreement.
2.2.4 Commitment Fee. The Borrowers agree to pay to the
Administrative Agent for the account of each Bank a commitment fee for
the period from and including the first day of the Guidance Loan
Commitment Period to the Guidance Loan Maturity Date, computed at the
rate of .225% per annum on the average daily amount of the unused
Guidance Loan Commitment of such Bank during the period for which
payment is made, payable quarterly in arrears on the fifteenth day of
the month following the end of each fiscal quarter ending after the
Closing Date and on the Guidance Loan Maturity Date or such earlier
date as the Guidance Loan Commitments shall terminate as provided
herein commencing on the first of such dates to occur after the date
of this Agreement; provided, however, that, from and after September
24, 1997, the commitment fee will be adjusted, on each Adjustment Date
based upon the ratio of Consolidated Debt at the last day of the 12
month period ended on the date of the financial statements relating to
such Adjustment Date to the Adjusted Consolidated EBITDA for such
period as determined from such financial statements, to the commitment
fee set forth on Annex A attached hereto opposite the level for which
the ratio of Consolidated Debt to Adjusted Consolidated EBITDA as so
determined satisfies the corresponding criteria set forth under the
heading "Ratio of Consolidated Debt to Adjusted Consolidated EBITDA."
2.2.5 Conversion of Guidance Loans. On the Guidance Loan
Conversion Date, the principal amount of each Guidance Loan
outstanding on such date shall be converted into a Loan having a fixed
repayment schedule as provided below (each a "Converted Guidance
Amount"), and may no longer be reborrowed hereunder, and the entire
Guidance Loan Commitment shall thereupon be reduced to an amount equal
to the aggregate sum of all Converted Guidance Amounts. From and after
the Guidance Loan Conversion Date, the then outstanding principal
amount of each Guidance Note evidencing each such Converted Guidance
Amount shall be due and payable in twelve (12) equal, quarterly
installments, commencing on the last day of the first full calendar
quarter following the Guidance Loan Conversion Date. From and after
the Guidance Loan Conversion Date, interest (computed on the basis of
the actual number of days elapsed over a 360-day year) on the unpaid
Converted Guidance Amount shall accrue at rate(s) selected by the
Borrower Agent, in accordance with the provisions of subsection
2.2.1(b).
2.2.6 Termination or Reduction of Commitments. The Borrower
Agent shall have the right, upon not less than ten (10) Business Days'
prior notice to the Administrative Agent, to terminate the Guidance
Loan Commitments or, from time to time, to reduce the amount of the
Guidance Loan Commitments, provided that no such termination or
reduction shall be permitted if, after giving effect thereto and to
any prepayments of the Guidance Loans made on the effective date
thereof, the aggregate principal amount of the Guidance Loans then
outstanding would exceed the Guidance Loan Commitments then in effect.
Any such reduction shall be in an amount equal to $1,000,000 or a
whole multiple of $500,000 in excess thereof and shall reduce
permanently the Guidance Loan Commitments then in effect.
2.2.7 Repayment of Guidance Loans; Evidence of Debt.ce Loans;
Evidence of Debt
(a) The Borrowers unconditionally promise to pay to the
Administrative Agent for the account of each Bank the then unpaid
principal amount of each Guidance Loan of such Bank on the Guidance
Loan Maturity Date (or such earlier date on which the Guidance Loans
become due and payable pursuant to Section 8.1). The Borrowers shall
pay interest on the unpaid principal amount of the Guidance Loans from
time to time outstanding from the date of this Agreement until payment
in full thereof at the rates per annum, and on the dates, set forth in
subsection 3.4.
(b) The Administrative Agent shall record in the Register,
with separate subaccounts for each Bank, (i) the amount and Borrowing
Date of each Guidance Loan made hereunder, the Type thereof and each
Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the
Borrowers to each Bank on such Guidance Loan and (iii) both the amount
of any sum received by the Administrative Agent hereunder from the
Borrowers and each Bank's share thereof.
(c) The entries made in the Register pursuant to subsection
2.2.7(b) shall, to the extent permitted by applicable law, be prima
facie evidence of the existence and amounts of the obligations of the
Borrowers therein recorded; provided, however, that the failure of the
Administrative Agent to maintain the Register, or any error therein,
shall not in any manner affect the obligation of the Borrowers to repay
(with applicable interest) the Guidance Loans made by each Bank in
accordance with the terms of this Agreement.
(d) On the Closing Date, the Borrowers will execute and
deliver to the Administrative Agent certain Guidance Notes, each dated
as of the Closing Date, from the Borrowers, evidencing the Guidance
Loans of each Bank, each substantially in the form of Exhibit C, with
appropriate insertions as to the name and address of such Bank, the
date and principal amount (a "Guidance Note"). Each Bank is hereby
authorized to record the date and amount of each Guidance Loan made by
such Bank and the date and amount of each payment or prepayment of
principal thereof on the schedule annexed to and constituting a part of
the Guidance Note, and any such recordation shall, to the extent
permitted by applicable law, constitute prima facie evidence of the
accuracy of the information so recorded; provided, however, that the
failure to make any such recordation (or any error therein) shall not
affect the obligation of the Borrowers to repay (with applicable
interest) the Guidance Loans made by such Bank in accordance with the
terms of this Agreement.
. 3. GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT
3.1 Optional and Mandatory Prepayments.
(a) Any Borrower may at any time and from time to time prepay the
Loans, in whole or in part, without premium or penalty, upon irrevocable notice
to the Administrative Agent prior to 11:00 a.m., Boston, Massachusetts time, one
(1) Business Day prior to such prepayment, specifying the date and amount of
prepayment and whether the prepayment is of LIBOR Loans, ABR Loans or a
combination thereof, and, if of a combination thereof, the amount allocable to
each. Upon receipt of any such notice the Administrative Agent shall notify each
affected Bank thereof on the date of receipt of such notice. If any such notice
is given, the amount specified in such notice shall be due and payable on the
date specified therein, together with any amounts payable pursuant to subsection
3.11. Amounts prepaid on account of the Guidance Loans may not be reborrowed
after the Guidance Loan Conversion Date. Partial prepayments shall be in the
aggregate principal amount of $1,000,000 or a whole multiple of $500,000 in
excess thereof.
(b) The Guidance Loans shall be prepaid, and after the Guidance Loans
shall have been prepaid in full, any outstanding Working Capital Loans shall be
prepaid, with 100% (or such lesser amount as is equal to the outstanding
Guidance Loans or Working Capital Loans) of (i) the Net Proceeds of the issuance
of Capital Stock or other equity (other than the exercise of stock options
issued to officers, directors or employees) by any Borrower subsequent to the
Closing Date (other than the issuance of additional shares of Capital Stock or
other equity by any Borrower to Fine Host or any other Borrower; provided,
however, that such shares of Capital Stock are pledged to the Administrative
Agent, for the ratable benefit of the Banks, pursuant to the Pledge Agreements);
(ii) the Net Proceeds of any Subordinated Debt incurred by any Borrower
subsequent to the Closing Date; (iii) Net Contract Proceeds in excess of Two
Million Five Hundred Thousand and 00/100 Dollars ($2,500,000.00) during each
fiscal year of the Borrowers, commencing with the fiscal year ended December 31,
1997, and (iv) Net Proceeds of any Asset Sale by any Borrower permitted under
subsection 7.6, where the Net Proceeds realized from such Asset Sale (or series
of related Asset Sales) exceed Two Million Five Hundred Thousand and 00/100
Dollars ($2,500,000.00). The Borrowers shall be entitled to retain and utilize
in their discretion (y) Net Contract Proceeds that are Two Million Five Hundred
Thousand and 00/100 Dollars ($2,500,000.00) or less and (z) Net Proceeds of any
Asset Sale by any Borrower permitted under subsection 7.6, where the Net
Proceeds realized from any such Asset Sale (or series of related Asset Sales)
are Two Million Five Hundred Thousand and 00/100 Dollars ($2,500,000.00) or
less. Each prepayment pursuant to this subsection 3.1(b) shall be made on the
tenth Business Day following receipt of such Net Proceeds or Net Contract
Proceeds, as the case may be. Except as otherwise provided in subsection 2.2.5,
no prepayment pursuant to this subsection 3.1(b) shall reduce the amounts of the
Commitments.
(c) Prepayments of outstanding Guidance Loans pursuant to subsection
3.1(b) shall be applied to the prepayment of such Guidance Loans pro rata to the
Banks. Prepayments of outstanding Working Capital Loans pursuant to subsection
3.1(b) shall be applied to the prepayment of such Working Capital Loans pro rata
to the Banks. Amounts to be applied pursuant to this subsection 3.1(c) to the
prepayment of Loans shall be applied, as applicable, first to reduce the
outstanding Guidance Loans and/or Working Capital Loans which are ABR Loans. Any
amounts remaining after each such application shall, at the option of the
Borrower Agent, be applied to prepay Guidance Loans and/or Working Capital Loans
which are LIBOR Loans immediately and/or shall be deposited in the Prepayment
Account (as defined below). The Administrative Agent shall apply any cash
deposited in the Prepayment Account (i) allocable to Guidance Loans to prepay
Guidance Loans which are LIBOR Loans and (ii) allocable to Working Capital Loans
to prepay Working Capital Loans which are LIBOR Loans, in each case on the last
day of the respective Interest Periods therefor (or, at the direction of the
Borrower Agent, on any earlier date) until all outstanding Guidance Loans and/or
Working Capital Loans which are LIBOR Loans have been prepaid or until all cash
on deposit in the Prepayment Account with respect to such Loans has been
exhausted. For purposes of this Agreement, the term "Prepayment Account" shall
mean an account established by the Borrower Agent, on the behalf of the
Borrowers, with the Administrative Agent and over which the Administrative Agent
shall have exclusive dominion and control, including the right of withdrawal for
application in accordance with this subsection 3.1(c). The Administrative Agent
will, at the request of the Borrower Agent, invest amounts on deposit in the
Prepayment Account in Cash Equivalents that mature prior to the last day of the
applicable Interest Periods of the LIBOR Loans to be prepaid; provided, however,
that the Administrative Agent shall not be required to make any investment that,
in its sole judgment, would require or cause the Administrative Agent to be in,
or would result in any, violation of any Requirement of Law and (ii) the
Administrative Agent shall have no obligation to invest amounts on deposit in
the Prepayment Account if a Default or Event of Default shall have occurred and
be continuing. The Borrowers shall indemnify the Administrative Agent for any
losses relating to the investments so that the amount available to prepay LIBOR
Loans on the last day of the applicable Interest Periods therefor is not less
than the amount that would have been available had no investments been made.
Other than any interest earned on such investments, the Prepayment Account shall
not bear interest. Interest or profits, if any, on such investments shall be
deposited and reinvested and disbursed as described above. If the maturity of
the Loans has been accelerated pursuant to Section 8.1, the Administrative Agent
shall first apply all amounts on deposit in the Prepayment Account to prepay the
outstanding Guidance Loans pro rata to the Banks and, then, to prepay any
outstanding Working Capital Loans pro rata to the Banks. On behalf of the
Borrowers, the Borrower Agent hereby grants to the Administrative Agent, for its
benefit and the ratable benefit of the Banks, a security interest in the
Prepayment Account to secure the Liabilities. Subject to the foregoing
provisions of this subsection 3.1, all prepayments hereunder shall be allocated
among the Guidance Loans and the Working Capital Loans, as directed by the
Borrower Agent.
3.2 Conversion Options
(a) The Borrower Agent may elect from time to time to convert LIBOR
Loans to ABR Loans by giving the Administrative Agent at least one Business
Day's prior irrevocable notice of such election, provided that any such
conversion of LIBOR Loans may only be made on the last day of an Interest Period
with respect thereto (or on any other day if on the date of such conversion, the
Borrowers pay to the Administrative Agent for the account of the applicable
Banks accrued interest on such LIBOR Loans to the date of such conversion
together with all amounts payable under subsection 3.11). The Borrower Agent may
elect from time to time to convert ABR Loans to LIBOR Loans by giving the
Administrative Agent at least three Business Days' prior irrevocable notice of
such election. Any such notice of conversion to LIBOR Loans shall specify the
length of the initial Interest Period or Interest Periods therefor. Upon receipt
of any such notice the Administrative Agent shall promptly notify each affected
Bank thereof. All or any part of outstanding LIBOR Loans and ABR Loans may be
converted as provided herein, provided that (i) no Loan may be converted into a
LIBOR Loan when any Default or Event of Default has occurred and is continuing
and (ii) no Loan may be converted into a LIBOR Loan after the date that is one
month prior to the Working Capital Maturity Date (in the case of conversions of
Working Capital Loans) or the Guidance Loan Maturity Date (in the case of
conversions of Guidance Loans).
(b) Any LIBOR Loans may be continued as such upon the expiration of the
then current Interest Period with respect thereto by the Borrower Agent giving
notice to the Administrative Agent of the length of the next Interest Period to
be applicable to such Loans; provided, however, that no LIBOR Loan may be
continued as such (i) when any Default or Event of Default has occurred and is
continuing or (ii) after the date that is one month prior to the Working Capital
Maturity Date (in the case of continuations of Working Capital Loans) or the
Guidance Loan Maturity Date (in the case of continuations of Guidance Loans) and
provided, further, however, that if the Borrower Agent shall fail to give such
notice or if such continuation is not permitted such Loans shall be
automatically converted to ABR Loans on the last day of such then expiring
Interest Period.
3.3 Minimum Amounts and Maximum Number of Loans. All borrowings,
conversions and continuations of Loans hereunder and all selections of Interest
Periods hereunder shall be in such amounts and be made pursuant to such
elections so that, after giving effect thereto, the aggregate principal amount
of the Loans comprising each LIBOR Loan shall be equal to $1,000,000 or a whole
multiple of $500,000 in excess thereof. In no event shall there be more than
twelve (12) LIBOR Loans outstanding at any time.
3.4 Interest Rates and Payment Dates.and Payment Dates
(a) Each LIBOR Loan shall bear interest for each day during each
Interest Period with respect thereto at a rate per annum equal to the LIBOR Rate
determined for such day plus the Applicable Margin.
(b) Each ABR Loan shall bear interest at a rate per annum equal to the
ABR.
(c) If all or a portion of (i) the principal amount of any Loan, (ii)
any interest payable thereon or (iii) any commitment fee or other amount payable
hereunder shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise, but taking into account any applicable grace period
under subsection 8.1(a)), such overdue amount shall bear interest at a rate per
annum which is (x) in the case of overdue principal, the rate that would
otherwise be applicable thereto pursuant to the foregoing provisions of this
subsection plus Two Percent (2%) or (y) in the case of overdue interest,
commitment fees or other amounts due and payable hereunder, the rate equal to
the ABR plus Two Percent (2%), in each case from the date of such non-payment
until such amount is paid in full (after as well as before judgment).
(d) Interest shall be payable in arrears on each Interest Payment Date;
provided, however, that interest accruing pursuant to subsection 3.4(c) shall be
payable from time to time on demand.
Computation of Interest and Fees.Interest and Fees
(a) Commitment fees and interest shall be calculated on the basis of a
360-day year for the actual days elapsed. The Administrative Agent shall use its
best efforts to notify the Borrower Agent and the affected Banks as soon as
practicable of each determination of a LIBOR Rate. Any change in the interest
rate on a Loan resulting from a change in the ABR or the LIBOR Reserve
Requirement shall become effective as of the opening of business on the day on
which such change becomes effective. The Administrative Agent shall use its best
efforts to notify the Borrower Agent and the affected Banks as soon as
practicable of the effective date and the amount of each such change in interest
rate.
(b) Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Borrowers and the Banks in the absence of manifest error. The Administrative
Agent shall, at the request of the Borrower Agent, deliver to the Borrower Agent
a statement showing the quotations used by the Administrative Agent in
determining any interest rate pursuant to subsection 3.4(a).
3.6 Inability to Determine Interest RateInability to Determine Interest
Rate. If prior to the first day of any Interest Period: (i) the Administrative
Agent shall have determined (which determination shall be conclusive and binding
upon the Borrowers) that, by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining the LIBOR
Rate for such Interest Period, or (ii) the Administrative Agent shall have
received notice from the Required Banks that the LIBOR Rate determined or to be
determined for such Interest Period will not adequately and fairly reflect the
cost to such Banks (as conclusively certified by such Banks) of making or
maintaining their affected Loans during such Interest Period, the Administrative
Agent shall give telecopy or telephonic notice thereof to the Borrower Agent and
the affected Banks as soon as practicable thereafter. If such notice is given
(a) any LIBOR Loans requested to be made on the first day of such Interest
Period shall be made as ABR Loans, and (b) any Loans that were to have been
converted on the first day of such Interest Period to LIBOR Loans shall be
converted to or continued as ABR Loans. Until such notice has been withdrawn by
the Administrative Agent, no further LIBOR Loans shall be made or continued as
such, nor shall the Borrower Agent have the right to convert ABR Loans to LIBOR
Loans.
3.7 Pro Rata Treatment and Payments.
(a) All payments (including prepayments) to be made by the Borrowers
hereunder, whether on account of principal, interest, fees or otherwise, shall
be made without set off or counterclaim and shall be made prior to 12:30 P.M.,
Boston, Massachusetts time, on the due date thereof to the Administrative Agent,
for the account of the Banks at the Administrative Agent's office specified in
subsection 10.12, in Dollars and in immediately available funds. Payments
received by the Administrative Agent after such time shall be deemed to have
been received on the next Business Day. The Administrative Agent shall
distribute such payments to the Banks entitled to receive the same promptly upon
receipt in like funds as received. If any payment hereunder (other than payments
on the LIBOR Loans) becomes due and payable on a day other than a Business Day,
such payment shall be extended to the next succeeding Business Day, and, with
respect to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension. If any payment on a LIBOR Loan becomes
due and payable on a day other than a Business Day, the maturity thereof shall
be extended to the next succeeding Business Day (and, with respect to payments
of principal, interest shall be payable thereon at the then applicable rate
during such extension) unless the result of such extension would be to extend
such payment into another calendar month, in which event such payment shall be
made on the immediately preceding Business Day. If, and to the extent that, on
any Business Day the Administrative Agent receives any payment hereunder or
under the other Loan Documents (including any such payment representing a
realization upon the Collateral), and such payment is not sufficient to pay in
full all principal, interest and fees then due and payable hereunder, the
Administrative Agent shall apply such payment ratably to all such amounts then
due and payable.
(b) Unless the Administrative Agent shall have been notified in writing
by any Bank prior to a borrowing that such Bank will not make the amount that
would constitute its portion of such borrowing available to the Administrative
Agent, the Administrative Agent may assume that such Bank is making such amount
available to the Administrative Agent, and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower Agent a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Bank shall pay
to the Administrative Agent, on demand, such amount with interest thereon at a
rate equal to the daily average Federal Funds Rate for the period until such
Bank makes such amount immediately available to the Administrative Agent. A
certificate of the Administrative Agent submitted to any Bank with respect to
any amounts owing under this subsection shall be conclusive in the absence of
manifest error. If such Bank's portion of such borrowing is not made available
to the Administrative Agent by such Bank within three (3) Business Days of such
Borrowing Date, the Administrative Agent shall also be entitled to recover such
amount with interest thereon at the rate per annum applicable to ABR Loans
hereunder, on demand, from the Borrowers, without prejudice to any right or
claim which any of the Borrowers may have against such Bank.
(c) Each borrowing by the Borrower Agent of Loans (other than Swing
Line Loans) shall be made ratably from the Banks, in accordance with their
respective Commitment Percentages. Any reduction of the Commitments shall be
made ratably among the Banks, in accordance with their respective Commitment
Percentages.
3.8 IllegalityIllegality. Notwithstanding any other provision herein,
if the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof shall make it unlawful for any Bank to
make or maintain LIBOR Loans as contemplated by this Agreement, (a) the
commitment of such Bank hereunder to make LIBOR Loans, continue LIBOR Loans as
such and convert ABR Loans to LIBOR Loans shall forthwith be suspended until
such time as it shall no longer be unlawful for such Bank to make or maintain
LIBOR Loans as contemplated by this Agreement and (b) such Bank's Loans then
outstanding as LIBOR Loans, if any, shall be converted automatically to ABR
Loans on the respective last days of the then current Interest Periods with
respect to such Loans or within such earlier period as required by law. If any
such conversion of a LIBOR Loan occurs on a day which is not the last day of the
then current Interest Period with respect thereto, the Borrowers shall pay to
such Bank such amounts, if any, as may be required pursuant to subsection 3.11.
3.9 Requirements of Law.
(a) If the adoption of or any change in any Requirement of Law or in
the interpretation or application thereof or compliance by any Bank with any
request or directive (whether or not having the force of law) from any central
bank or other Governmental Authority, in each case made subsequent to the date
hereof: (i) shall subject any Bank to any tax of any kind whatsoever with
respect to this Agreement, any Note, any Letter of Credit, any Application or
any LIBOR Loan made by it, or change the basis of taxation of payments to such
Bank in respect thereof (except for Non-Excluded Taxes as defined in subsection
3.10, changes in the rate of tax on the overall net income of such Bank and
taxes imposed as a result of any future, present or former connection between
the Bank and the jurisdiction of the Governmental Authority imposing such tax or
any political subdivision or taxing authority thereof or therein (other than any
such connection arising solely from the Bank having executed, delivered or
performed its obligations or received a payment under, or enforced, this
Agreement or any Note)); (ii) shall impose, modify or hold applicable any
reserve, special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of, advances, loans
or other extensions of credit by, or any other acquisition of funds by, any
office of such Bank which is not otherwise included in the determination of the
LIBOR Rate hereunder; or (iii) shall impose on such Bank any other condition;
and the result of any of the foregoing is to increase the cost to such Bank, by
an amount which such Bank deems to be material, of making, converting into,
continuing or maintaining LIBOR Loans or issuing or participating in Letters of
Credit or to reduce any amount receivable hereunder in respect thereof, then, in
any such case, the Borrowers shall, within ten (10) Business Days after receipt
by the Borrower Agent of such Bank's written demand (with a copy to the
Administrative Agent), pay such Bank such additional amount or amounts as will
compensate such Bank for such increased cost or reduced amount receivable. If
any Bank has demanded compensation under this subsection 3.9(a) with respect to
any LIBOR Loan, the Borrower Agent shall have the option to convert immediately
such LIBOR Loan into an ABR Loan until the circumstances giving rise to such
demand for compensation no longer apply; provided, however, that (i) no such
conversion shall affect the obligation of the Borrowers to pay compensation as
provided herein which is due with respect to the period prior to such conversion
and (ii) on the date of such conversion the Borrowers shall pay to the
Administrative Agent for the benefit of the relevant Bank accrued interest on
such LIBOR Loan to the date of conversion, together with any amounts payable
pursuant to subsection 3.11.
(b) If any Bank shall have determined that the adoption of or any
change in any Requirement of Law regarding capital adequacy or in the
interpretation or application 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) from any Governmental
Authority, in each case made subsequent to the date hereof, shall have the
effect of reducing the rate of return on such Bank's or such corporation's
capital as a consequence of its obligations hereunder or under any Letter of
Credit to a level below that which such Bank or such corporation could have
achieved but for such adoption, change or compliance (taking into consideration
such Bank's or such corporation's policies with respect to capital adequacy) by
an amount deemed by such Bank to be material, then from time to time, within ten
(10) Business Days after receipt by the Borrower Agent of such Bank's written
demand (with a copy to the Administrative Agent), the Borrowers shall pay to
such Bank such additional amount or amounts as will compensate such Bank for
such reduction. The determination by such Bank of the amount of any such
increased costs incurred by it, if done in good faith, and the allocation, if
any, of such costs among the Borrowers and other customers which have
arrangements, directly or indirectly, with such Bank similar to the LIBOR
option, if made on an equitable basis, in the absence of manifest error, shall
be conclusive.
(c) If any Bank becomes entitled to claim any additional amounts
pursuant to subsection 3.9(a) or (b), it shall promptly notify the Borrower
Agent (with a copy to the Administrative Agent) of the event by reason of which
it has become so entitled. A certificate as to any additional amounts payable
pursuant to this subsection submitted by such Bank to the Borrower Agent (with a
copy to the Administrative Agent) shall be conclusive in the absence of manifest
error. The Borrowers shall not be obligated to compensate any Bank pursuant to
this subsection 3.9 for amounts for any period in respect of which such Bank did
not comply with its obligation set forth in the first sentence of this
subsection; provided, however, that the notice provided for in such sentence
need not include a computation of amounts in respect thereof. The agreements in
this subsection shall survive the termination of this Agreement and the payment
of the Loans and all other amounts payable hereunder.
3.10 Taxes.
(a) All payments made by the Borrowers under this Agreement and any
Notes shall be made free and clear of, and without deduction or withholding for
or on account of, any present or future income, stamp or other taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any Governmental Authority,
excluding net income taxes and franchise taxes (imposed in lieu of net income
taxes) imposed on the Administrative Agent or any Bank (or Transferee) as a
result of any future, present or former connection between the Administrative
Agent or such Bank (or Transferee) and the jurisdiction of the Governmental
Authority imposing such tax or any political subdivision or taxing authority
thereof or therein (other than any such connection arising solely from the
Administrative Agent or such Bank (or Transferee) having executed, delivered or
performed its obligations or received a payment under, or enforced this
Agreement or any Note or any other Loan Document). If any such non-excluded
taxes, levies, imposts, duties, charges, fees deductions or withholdings
("Non-Excluded Taxes") are required to be withheld from any amounts payable to
the Administrative Agent or any Bank (or Transferee) hereunder or under any
Note, the amounts so payable to the Administrative Agent or such Bank (or
Transferee) shall be increased ("increased amounts") to the extent necessary to
yield to the Administrative Agent or such Bank (or Transferee) (after payment of
all Non-Excluded Taxes) interest or any such other amounts payable hereunder at
the rates or in the amounts specified in this Agreement. Whenever any
Non-Excluded Taxes are payable by the Borrowers, the Borrower Agent shall
promptly send to the Administrative Agent for its own account or for the account
of such Bank (or Transferee), as the case may be, a certified copy of an
original official receipt showing payment thereof or other evidence of
remittance of Non-Excluded Taxes reasonably acceptable to the Administrative
Agent. If the Borrowers fail to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fail to remit to the Administrative Agent the
required receipts or other reasonably acceptable evidence, the Borrowers shall
indemnify the Administrative Agent and the Banks for any incremental taxes,
interest or penalties that may become payable to the Administrative Agent or any
Bank as a result of any such failure. The Borrowers will indemnify each Bank (or
Transferee) and the Administrative Agent for the amount of Non-Excluded Taxes
paid by such Bank (or Transferee) or the Administrative Agent, as the case may
be, and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto. The agreements in this subsection 3.10 shall
survive the termination of this Agreement and payment of the Loans and all other
amounts payable thereunder.
(b) Each Bank (and each Transferee) that is not incorporated or
organized under the laws of the United States of America or a state thereof
shall:
(i) in the case of a Bank or a Transferee that is a
"bank" under Section 881(c)(3)(A) of the Tax Code:
(A) on or before the date it becomes a party to this
Agreement (or, in the case of a Loan Participant, on or before
the date such Loan Participant becomes a Loan Participant
hereunder) and on or before the date, if any, such Bank (or
Transferee) changes its applicable lending office by
designating a different lending office (a "New Lending
Office") deliver to the Borrower Agent and the Administrative
Agent (y) two properly completed and duly executed copies of
United States Internal Revenue Service Form 1001 or 4224, or
successor applicable form, as the case may be, and (z) an
Internal Revenue Service Form W-8, or successor applicable
form, as the case may be;
(B) deliver to the Borrower Agent and the
Administrative Agent two further properly completed and duly
executed copies of any such form or certification on or before
the date that any such form or certification expires or
becomes obsolete or invalid and after the occurrence of any
event requiring a change in the most recent form previously
delivered by it to the Borrower Agent or upon the request of
the Borrower Agent or the Administrative Agent; and
(C) obtain such extensions of time for filing and
completing such forms or certifications as may reasonably be
requested by the Borrower Agent;
(ii) in the case of a Bank or a Transferee that is not a
"bank" under Section 881(c)(3)(A) of the Tax Code:
(A) on or before the date it becomes a party to this
Agreement (or, in the case of a Loan Participant, on or before
the date such Loan Participant becomes a Loan Participant
hereunder) deliver to the Borrower Agent and the
Administrative Agent (I) a statement under penalties of
perjury that such Bank (x) is not a "bank" under Section
881(c)(3)(A) of the Tax Code, is not subject to regulatory or
other legal requirements as a bank in any jurisdiction, and
has not been treated as a bank for purposes of any tax,
securities law or other filing or submission made to any
Governmental Authority, any application made to a rating
agency or qualification for any exemption from tax, securities
law or other legal requirements, (y) is not a 10-percent
shareholder within the meaning of Section 871(h)(3)(B) of the
Tax Code and (z) is not a controlled foreign corporation
receiving interest from a related person within the meaning of
Section 864(d)(4) of the Tax Code and (II) a properly
completed and duly executed Internal Revenue Service Form W-8
or applicable successor form;
(B) deliver to the Borrower Agent and the
Administrative Agent two further properly completed and duly
executed copies of said Form W-8, or any successor applicable
form on or before the date that any such Form W-8 expires or
becomes obsolete or invalid and after the occurrence of any
event requiring a change in the most recent form previously
delivered by it to the Borrower Agent or upon the request of
the Borrower Agent; and
(C) obtain such extensions of time for filing and
completing such forms or certification as may be reasonably
requested by the Borrower Agent or the Administrative Agent;
Each such Bank (and each Transferee) shall certify (i) in the case of a
Form 1001 or 4224, that it is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal
income taxes and (ii) in the case of a Form W-8 delivered pursuant to
subsection 3.10(b)(ii), that it is entitled to an exemption from United
States withholding tax.
(c) The Borrowers shall not be required to indemnify any Bank
(or Transferee), or to pay any increased amounts to any Bank (or
Transferee) in respect of any Non-Excluded Tax, pursuant to this
subsection 3.10 or otherwise to the extent that (i) any obligation to
withhold or deduct amounts with respect to tax existed on the date such
Bank (or Transferee) became a party to this Agreement (or, in the case
of a Transferee that is a Loan Participant, on the date such Loan
Participant became a Loan Participant hereunder) or, with respect to
payments to a New Lending Office, the date such Bank (or Transferee)
designated such New Lending Office with respect to a Loan; provided,
however, that this clause shall not apply to (i) any Transferee or New
Lending Office that becomes a Transferee or New Lending Office as a
result of an assignment, participation, transfer or designation made at
the written request of the Borrower Agent, or (ii) any Bank (or
Transferee) that fails to comply in full with the provisions of
subsection 3.10(b) hereof.
(d) If a Bank (of Transferee) or the Administrative Agent
shall become aware that it is entitled to claim a refund from a
Governmental Authority in respect of Non-Excluded Taxes as to which it
has been indemnified by the Borrowers, or with respect to which the
Borrowers have paid increased amounts, pursuant to this section 3.10,
it shall promptly notify the Borrower Agent of the availability of such
refund claim and shall make the appropriate claim to such Governmental
Authority for such refund. If a Bank (or Transferee) or the
Administrative Agent receives a refund (including pursuant to a claim
for refund made pursuant to the preceding sentence) in respect of any
Non-Excluded Tax as to which it has been indemnified by the Borrowers,
or with respect to which the Borrowers have paid increased amounts,
pursuant to this subsection 3.10, it shall within 30 days from the date
of such receipt pay over such refund to the Borrower Agent, net of all
out-of-pocket third-party expenses of such Bank (or Transferee) or the
Administrative Agent.
3.11 Indemnity. The Borrowers agree to indemnify each Bank
and to hold each Bank harmless from any loss or expense (other than
the loss of any payments in respect of the Applicable Margin) which
such Bank may sustain or incur as a consequence of (a) default by the
Borrower Agent in making a borrowing of, conversion into or
continuation of LIBOR Loans after the Borrower Agent has given a
notice requesting the same in accordance with the provisions of this
Agreement, (b) default by the Borrowers in making any prepayment after
the Borrower Agent has given a notice thereof in accordance with the
provisions of this Agreement or (c) the making of a prepayment of
LIBOR Loans or converting any LIBOR Loans to ABR Loans on a day which
is not the last day of an Interest Period with respect thereto. Such
indemnification may include an amount equal to the excess, if any, of
(i) the amount of interest which would have accrued on the amount so
prepaid or converted, or not so borrowed, converted or continued, for
the period from the date of such prepayment or conversion or of such
failure to borrow, convert or continue to the last day of such
Interest Period (or, in the case of a failure to borrow, convert or
continue, the Interest Period that would have commenced on the date of
such failure) in each case at the applicable rate of interest for such
Loans provided for herein (excluding, however, the Applicable Margin
included therein, if any) over (ii) the amount of interest (as
reasonably determined by such Bank) which would have accrued to such
Bank on such amount by placing such amount on deposit for a comparable
period with leading banks in the London interbank market (a written
notice as to the additional amounts owed to such Bank, showing the
basis for the calculation thereof, submitted to the Borrower Agent by
such Bank shall, absent manifest error, be final and conclusive and
binding upon all parties hereto). This covenant shall survive the
termination of this Agreement and the payment of the Loans and all
other amounts payable hereunder.
3.12 Change of Lending Office; Filing of Certificates or
Documents. Each Bank agrees that if it makes any demand for payment,
or becomes entitled to any increased amounts, under subsection 3.8,
3.10 or 3.11(a) or if any adoption or change of the type described in
subsection 3.9 shall occur with respect to it, it will use reasonable
efforts (consistent with its internal policy and legal and regulatory
restrictions and so long as such efforts would not be disadvantageous
to it, as determined in its sole discretion) to designate a different
lending office or file any certificate or document reasonably
requested in writing by the Borrower Agent if such action would reduce
or obviate the need for the Borrowers to make payments under
subsection 3.8, 3.10 or 3.11(a) or would eliminate or reduce the
effect of any adoption or change described in subsection 3.9.
3.13 Replacement Banks. In the event that the Borrowers
become obligated to pay additional amounts or increased amounts to, or
receives notice from, any Bank pursuant to subsection 3.8, 3.9 or 3.10
then, unless such Bank has theretofore removed or cured the conditions
which result in the obligation to pay such additional amounts or
increased amounts, the Borrowers may, on ten (10) Business Days' prior
written notice from the Borrower Agent to the Administrative Agent and
such Bank, cause such Bank to (and such Bank shall) assign pursuant to
subsection 10.15 all of its rights and obligations under this
Agreement to another bank or financial institution which is willing to
become a Bank (or is a Bank) and is acceptable (which acceptance shall
not be unreasonably withheld) to the Administrative Agent, for a
purchase price equal to the outstanding principal amount of the Loans
payable to such Bank plus any accrued but unpaid interest on such
Loans, any accrued but unpaid commitment fees in respect of such
Bank's Commitment and any other amounts payable to such Bank under
this Agreement (including, without limitation, amounts payable under
subsection 3.11).
3.14 Subordination of Intercompany Loans.
(a) The Borrowers acknowledge and agree that the
payment of all principal, interest and all other charges with
respect to the Intercompany Loans is expressly subordinated,
in all respects, to the right of the holders of the
Liabilities to the prior payment and satisfaction in full in
cash of all of the Liabilities.
(b) Upon the occurrence and during continuance of any
Default or Event of Default, all payments owed by any Borrower
with respect to the Intercompany Loans shall be made directly
to the Administrative Agent, for the ratable benefit of the
Banks, to retire amounts owed on the Liabilities, and if any
such payments are made by or on behalf of any Borrower to the
Administrative Agent, then the balance of the principal,
interest, fees and other charges outstanding with respect to
the Intercompany Loans shall be reduced by the amount of all
such payments.
(c) In the event of any Insolvency or other similar
proceeding initiated by or against any Borrower, all claims of
the holders of the Intercompany Loans in such proceeding shall
be deemed to be assigned to the Administrative Agent, for the
ratable benefit of the Banks. The holders of the Intercompany
Loans hereby agree to execute all documents that the
Administrative Agent requests in order to effectuate such
assignment; provided, however, that such assignment shall
terminate upon the earlier of (i) the discharge of such
Borrower from such Insolvency or other similar proceedings and
(ii) payment in full of all of the Liabilities. While such
assignment is in effect, and with the prior written consent of
the Required Banks, the Administrative Agent shall have the
exclusive right to exercise all of the rights of the holders
of the Intercompany Loans arising from their claims under such
proceedings (including, but not limited to, rights to vote and
to accept or reject a proposed plan of reorganization or
composition).
(d) Upon payment or distribution of any assets of any
Borrower in any Insolvency or other similar proceeding
initiated by or against such Borrower, whether voluntary or
involuntary, all of the Liabilities shall first be paid in
full before the holders of the Intercompany Loans shall
receive or retain any assets so paid or distributed in respect
of any obligation of such Borrower to the holders of the
Intercompany Loans for the Intercompany Loans. Any payment or
distribution of assets of such Borrower to which the holders
of the Intercompany Loans would be entitled shall be paid by
such Borrower or by the holders of the Intercompany Loans, any
receiver, trustee, assignee for benefit of creditors, agent or
other person making such payment of distribution to the
Administrative Agent, for the ratable benefit of the Banks, in
full prior to any payment or distribution to the holders of
the Intercompany Loans.
(e) The holders of the Intercompany Loans shall be
entitled to the right of subrogation with respect to payments
to the Banks made hereunder, but only if the Liabilities shall
have been first paid in full in cash and discharged.
. 3.15 Fees
(a) Closing Fee. On the Closing Date, the Borrowers
shall pay to the Administrative Agent, on behalf of the Banks,
a closing fee (the "Closing Fee") in the amount of Three
Hundred Seventy-Five Thousand and 00/100 Dollars
($375,000.00), to be promptly distributed by the
Administrative Agent to the Banks, in accordance with the
provisions of Annex B.
(b) Other Fees. In addition to the Closing Fee, the
Borrowers shall pay to the Administrative Agent, on behalf of
both the Documentation Agent and the Administrative Agent,
the other fees in the amounts and manner specified in the Fee
Letter.
4. CONDITIONS PRECEDENTCONDITIONS PRECEDENT.
4.1 Conditions to Effectiveness and Initial Extensions of Credit. The
effectiveness of this Agreement and the agreement of each Bank to make the
initial Extension of Credit requested to be made by it is subject to the
satisfaction, immediately prior to or concurrently with the making of such
Extension of Credit on the Closing Date, of the following conditions precedent:
(a) Loan Documents. The Administrative Agent shall have
received (i) this Agreement, executed and delivered by a duly
authorized officer or agent of each Borrower, with a counterpart for
the Administrative Agent and each Bank, (ii) for the account of each
Bank, a Working Capital Note and a Guidance Note, each conforming to
the requirements hereof and executed by a duly authorized officer or
agent of each Borrower, (iii) for the account of the Swing Line Bank, a
Swing Line Note conforming to the requirements hereof and executed by a
duly authorized officer or agent of each Borrower, (iv) the Pledge
Agreements, each executed and delivered by a duly authorized officer or
agent of each Borrower which is a party thereto, with a counterpart for
the Administrative Agent and a conformed copy for each Bank, (v) the
Security Agreements, each executed and delivered by a duly authorized
officer or agent of each Borrower which is a party thereto, with a
counterpart for the Administrative Agent and a conformed copy for each
Bank; (vi) each of the Assignments of Receivables and Proceeds, each
executed and delivered by a duly authorized officer or agent of each
Borrower which is a party thereto, with a counterpart for the
Administrative Agent and a conformed copy for each Bank; (vii) the
Kentucky Mortgage, executed and delivered by a duly authorized officer
of Fine Host, with a counterpart for the Administrative Agent and each
Bank; and (viii) the Kentucky Conditional Assignment of Rentals,
executed and delivered by a duly authorized officer of Fine Host, with
a counterpart for the Administrative Agent and each Bank.
(b) Actions to Perfect Liens. The Administrative Agent shall
have received evidence in form and substance reasonably satisfactory to
it that all filings, recordings, registrations and other actions,
including, without limitation, the filing of duly executed financing
statements on form UCC-1, necessary or, in the opinion of the
Administrative Agent, desirable to perfect the Liens created by the
Security Documents shall have been completed (or, to the extent that
any such filings, recordings, registrations and other actions shall not
have been completed, arrangements satisfactory to the Administrative
Agent for the completion thereof shall have been made).
(c) Lien Searches. The Administrative Agent shall have
received the results of a recent search by a Person satisfactory to the
Administrative Agent, of the UCC, judgment and tax lien filings which
may have been filed with respect to personal property of each Borrower
in the jurisdictions set forth in Schedule 4.1(c), and the results of
such search shall be satisfactory to the Administrative Agent.
(d) Pledged Stock; Stock Powers. The Administrative Agent
shall have received the certificates representing the shares pledged
pursuant to each of the Pledge Agreements Stock, together with an
undated stock power for each such certificate executed in blank by a
duly authorized officer of the pledgor.
(e) Authorization Proceedings of Fine Host. The Administrative
Agent shall have received, with a counterpart for each Bank, a copy of
the resolutions, in form and substance satisfactory to the
Administrative Agent, of the Board of Directors of Fine Host (and if
necessary, its shareholders) authorizing (i) the execution, delivery
and performance of this Agreement and the other Loan Documents to which
it is a party, (ii) the Extensions of Credit contemplated hereunder and
(iii) the granting by it of the Liens created pursuant to the Security
Documents to which it is a party, as certified by the Secretary or an
Assistant Secretary of Fine Host as of the Closing Date, which
certificate shall be in form and substance reasonably satisfactory to
the Administrative Agent and shall state that the resolutions thereby
certified have not been amended, modified, revoked or rescinded.
(f) Incumbency Certificate for Fine Host. The Administrative
Agent shall have received, with a counterpart for each Bank, a
certificate, dated as of the Closing Date, as to the incumbency and
signature of the officers of Fine Host executing any Loan Document,
reasonably satisfactory in form and substance to the Administrative
Agent, and executed by the President or any Vice President and the
Secretary or any Assistant Secretary of Fine Host.
(g) Charter Documents for Fine Host; Certificate of Corporate
Good Standing. The Administrative Agent shall have received the
following: (i) the charter or other incorporation documents for Fine
Host, as in effect on the Closing Date and as certified by the
secretary of state of the state of its incorporation, (ii) the by-laws
for Fine Host as in effect on the Closing Date, as certified by a duly
authorized officer of Fine Host; and (iii) a certificate of corporate
good standing for Fine Host, as issued by the secretary of state of the
state of its incorporation.
(h) Authorization Proceedings of Other Borrowers. The
Administrative Agent shall have received, with a counterpart for each
Bank, a copy of the resolutions, in form and substance reasonably
satisfactory to the Administrative Agent, of the Board of Directors
(and if necessary, its shareholders), the Governing Council or Members,
whichever is applicable, of each Borrower (other than Fine Host)
authorizing (i) the execution, delivery and performance of the Loan
Documents to which it is a party and (ii) the granting by it of the
Liens created pursuant to the Security Documents to which it is a
party, as certified by the Secretary or an Assistant Secretary of each
such Borrower (other than Fine Host) as of the Closing Date, which
certificate shall be in form and substance reasonably satisfactory to
the Administrative Agent and shall state that the resolutions thereby
certified have not been amended, modified, revoked or rescinded.
(i) Incumbency Certificates for Other Borrowers. The
Administrative Agent shall have received, with a counterpart for each
Bank, a certificate from each Borrower (other than Fine Host), dated as
of the Closing Date, as to the incumbency and signature of the officers
or members, whichever is applicable, of each such Borrower (other than
Fine Host), reasonably satisfactory in form and substance to the
Administrative Agent, and executed by a duly authorized officer or
member, whichever is applicable, of each such Borrower (other than Fine
Host).
(j) Charter Documents for Other Borrowers; Certificates of
Good Standing. The Administrative Agent shall have received the
following: (i) the charter or other organizational documents for each
Borrower (other than Fine Host), as in effect on the Closing Date and
as certified by the secretary of state of the state of its
incorporation or organization, (ii) the by-laws or operating agreement,
whichever is applicable, for each Borrower (other than Fine Host) as in
effect on the Closing Date, as certified by a duly authorized officer
or member, whichever is applicable, of such Borrower (other than Fine
Host), and (iii) to the extent applicable, a certificate of good
standing for each Borrower (other than Fine Host), as issued by the
secretary of state of the state of its incorporation or organization.
(k) Insurance. The Administrative Agent shall have received
evidence in form and substance satisfactory to it that all of the
requirements of subsection 6.7 and those sections of the Security
Documents requiring the maintenance of insurance shall have been
satisfied.
(l) Title Insurance Policy - Kentucky Mortgage. The
Administrative Agent shall have received with respect to the Kentucky
Property a mortgagee's title insurance policy or marked up
unconditional binder for such insurance dated as of the Closing Date.
Such policy shall (i) be in an amount reasonably satisfactory to the
Administrative Agent; (ii) be issued at ordinary rates; (iii) insure
that the Kentucky Mortgage creates a valid first Lien on the Kentucky
Property free and clear of all defects and encumbrances, except such as
may be approved by the Administrative Agent or as otherwise permitted
by this Agreement; (iv) name the Administrative Agent for the ratable
benefit of the Banks as the insured thereunder; (v) be in the form of
ALTA Loan Policy - 1970, if available; (vi) contain such endorsements
and affirmative coverage as the Administrative Agent may reasonably
request and are customary in transactions of this nature and available
without excessive premium and (vii) be issued by a title company
satisfactory to the Administrative Agent. The Administrative Agent
shall have received evidence satisfactory to it that all premiums in
respect of such policy, and all charges for mortgage recording tax, if
any, have been paid.
(m) Recorded Copies of Kentucky Mortgage and Kentucky
Conditional Assignment of Rentals. The Administrative Agent shall have
received a date stamped copy of the Kentucky Mortgage and the Kentucky
Conditional Assignment of Rentals, each as properly recorded at the
Office of the Clerk of Jefferson County, Kentucky.
(n) Borrowing Certificate. The Administrative Agent shall have
received, with a counterpart for each Bank, a certificate, dated as of
the Closing Date, from the Borrower Agent, substantially in the form of
Exhibit O, with appropriate insertions and attachments, satisfactory in
form and substance to the Administrative Agent, executed by the
President, Treasurer or any Vice President of the Borrower Agent.
(o) Legal Opinions. The Administrative Agent shall have
received, with a counterpart for each Bank, the following executed
legal opinions: (i) the executed legal opinion of Willkie Farr &
Gallagher, outside counsel to the Borrowers, substantially in the form
of Exhibit P; and (ii) the executed legal opinion of Ellen Keats, Esq.,
General Counsel to the Borrowers, substantially in the form of Exhibit
Q. Each such legal opinion shall cover such other matters incident to
the transactions contemplated by this Agreement as the Administrative
Agent may reasonably require.
(p) Fees. The Administrative Agent shall have received the
fees to be received on the Closing Date referred to in subsection 3.15.
4.2 Conditions to Each Extension of Credit. The agreement of each Bank
to make any Extension of Credit requested to be made by it on any date
(including, without limitation, its initial Extension of Credit and any
subsequent Extensions of Credit requested thereafter), and the agreement of the
Issuing Bank to issue any Letter of Credit for which an Application is
presented, is subject to the satisfaction of the following conditions precedent:
(a) Representations and Warranties. Each of the
representations and warranties made by the Borrowers in or pursuant to
the Loan Documents shall be true and correct in all material respects
on and as of such date, as if made on and as of such date, except to
the extent such representations and warranties expressly relate to an
earlier date in which case such representations and warranties shall be
true and correct in all material respects as of such earlier date.
(b) No Default. No Default or Event of Default shall have
occurred and be continuing on such date or after giving effect to the
Extension of Credit requested to be made on such date.
(c) Financial Condition. No Material Adverse Change shall
have occurred at any time or times subsequent to the most recent
financial statements of the Borrowers delivered in accordance with the
provisions of this Agreement.
(d) Senior Priority of Liabilities and Collateral. The
Liabilities shall be senior indebtedness of the Borrowers for all
purposes; and the Administrative Agent shall have, for the ratable
benefit of the Banks, a first priority perfected security interest in
all of the Collateral, subject to such Liens as are otherwise permitted
by subsection 7.1 of this Agreement.
(e) Reimbursement of Costs. The Borrowers shall have paid all
costs of the Administrative Agent and the Documentation Agent in
connection with the making and closing of the Loans and the issuance of
the Letters of Credit (including but not limited to, the fees and
expenses of the counsel for the Administrative Agent and the
Documentation Agent and as set forth in subsection 6.5).
(f) Approvals. The Borrowers shall have received all
Approvals and the same shall continue to be in full force and effect as
of the Closing Date.
(g) Other Requirements. The Administrative Agent shall have
received, in form and substance reasonably satisfactory to the
Administrative Agent and its counsel, all certificates, orders,
authorities, consents, affidavits, schedules, instruments, security
agreements, financing statements, mortgages and other documents which
are provided for hereunder or under any of the other Loan Documents,
and all other information relating to the transaction reasonably
requested by the Administrative Agent.
Each borrowing by and Letter of Credit issued on behalf of the Borrower Agent
hereunder shall constitute a representation and warranty by the Borrowers as of
the date thereof that the conditions contained in this subsection 4.2 have been
satisfied.
4.3 Additional Conditions Precedent for Each Guidance Loan of
$1,000,000 or More. The agreement of each Bank to make any Guidance Loan
requested to be made by it on any date (including, without limitation, its
initial Guidance Loan) in the principal amount of One Million and 00/100 Dollars
($1,000,000.00) or more is also subject to the satisfaction of the following
conditions precedent:
(a) The Borrower Agent shall submit to the Administrative
Agent either at the time such Guidance Loan is requested or prior to
consummation of each New Project or Permitted Acquisition, the
following: (i) a detailed itemization of the Project Costs of such New
Project or Permitted Acquisition, including a separate itemization of
the use of all the proceeds of such Guidance Loan, (ii) a certificate
of the Chief Executive Officer, Chief Financial Officer or Treasurer of
the Borrower Agent, certifying (x) as accurate the detailed itemization
of the Project Costs of such New Project or Permitted Acquisition and
identifying the capitalization period for such Project Costs, if
applicable, and (iii) as to pro forma compliance with the provisions of
clause (b) of this subsection 4.3 after giving effect to such New
Project or Permitted Acquisition.
(b) The Borrowers shall be in compliance with the financial
covenants set forth in subsections 7.1, 7.7, 7.9 and 7.10 after giving
effect to the requested Guidance Loan; provided that for purposes of
determining such compliance, the Adjusted Consolidated EBITDA will be
deemed to be the sum of the pro forma Consolidated EBITDA of the
combined companies, plus the aggregate amount of all compensation not
in the ordinary course of business paid to the owners of such target
company in such 12-month period (as set forth in a certificate of the
Chief Executive Officer, Chief Financial Officer or Treasurer of Fine
Host).
(c) The historical trailing 12-month Consolidated EBITDA of
the acquired business or target company in a Permitted Acquisition,
plus the aggregate amount of all compensation not in the ordinary
course of business paid to the owners of such target company in such
12-month period (as set forth in a certificate of the Chief Executive
Officer, Chief Financial Officer or Treasurer of Fine Host), shall be a
positive number at the time of acquisition.
(d) The acquired business or target company in a Permitted
Acquisition shall be substantially in the same or complementary line of
business as one or more of the Borrowers.
(e) Any Indebtedness incurred in connection with a Permitted
Acquisition (other than Loans or Letters of Credit) be incurred payable
to the order of the seller in such Permitted Acquisition and shall
constitute
Subordinated Debt.
5. REPRESENTATIONS, WARRANTIES AND COVENANTS.
In order to induce the Banks to enter into this Agreement and to make
the Loans and in order to induce the Issuing Bank to issue the Letters of
Credit, the Borrowers jointly and severally represent, warrant and covenant
that:
5.1 Legal Existence; Compliance with Law. Each Borrower (a) is duly
organized, validly existing and (except for each Joint Venture Subsidiary
Borrower) in good standing under the laws of the jurisdiction of its
organization, (b) has the power and authority to own and operate its property,
to lease the property it operates as lessee and to conduct the business in which
it is currently engaged, (c) is duly qualified or licensed to do business as a
foreign corporation or organization, as the case may be, and (except for each
Joint Venture Subsidiary Borrower) in good standing under the laws of each
jurisdiction where its ownership, lease or operation of property or the conduct
of its business requires such qualification except where the failure to be so
qualified and/or in good standing, in the aggregate could not reasonably be
expected to have a Material Adverse Effect and (d) is in compliance with all
Requirements of Law except to the extent that the failure to comply therewith
could not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.
Within one hundred twenty (120) days following the Closing Date, each
Borrower (other than the Joint Venture Subsidiary Borrowers) shall deliver to
the Administrative Agent certificates of foreign qualification from each
jurisdiction in which such Borrower does business as a foreign corporation or a
limited liability company, whichever is applicable or, in lieu thereof, such
other documents or information in respect of any such matter as shall be
acceptable to the Administrative Agent.
5.2 Power; Authorization; Enforceable Obligations. Each Borrower has
the power and authority, and the legal right, to make, deliver and perform the
Loan Documents to which it is a party and to borrow hereunder. Each Borrower has
taken all necessary action to authorize the Extensions of Credit on the terms
and conditions of this Agreement and any Notes and to authorize the execution,
delivery and performance by it of the Loan Documents to which it is a party. No
consent or authorization of, filing (other than those filings of UCC financing
statements to be made by the Borrowers in connection with the transactions
contemplated by this Agreement, and any and all routine filings to be made from
time to time thereafter in order to maintain the effectiveness of such UCC
financing statements), notice to or other act by or in respect of, any
Governmental Authority or any other Person is required to be obtained or made by
any Borrower in connection with the Extensions of Credit hereunder or with the
execution, delivery or performance by each Borrower or the validity or
enforceability with respect to or against any Borrower of the Loan Documents to
which it is a party. This Agreement has been, and each other Loan Document will
be, duly executed and delivered on behalf of each Borrower that is a party
thereto. This Agreement constitutes, and each other Loan Document when executed
and delivered will constitute, a legal, valid and binding obligation of each
Borrower that is a party thereto enforceable against such Borrower in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles
(whether enforcement is sought by proceedings in equity or at law).
5.3 Financial Data. The Borrowers have furnished to the Administrative
Agent the audited consolidated financial statements, of Fine Host and its
Subsidiaries as of December 25, 1996 and for the fiscal year then ended,
including the report and opinion of Deloitte & Touche LLP, relating thereto
(collectively, the "Initial Financial Statements"). All of the material
liabilities (actual and contingent) of each Borrower are fully, accurately and
completely disclosed in the Initial Financial Statements. The Initial Financial
Statements have been and all financial statements to be furnished in accordance
with subsection 6.1 will be prepared in accordance with the books and records of
the Borrowers and fairly present or will fairly present, as applicable, the
financial condition of the Borrowers, taken as a whole, at the dates thereof and
the results of operations for the periods indicated (subject, in the case of
unaudited financial statements, to normal year-end adjustments, none of which
are expected to be material). The Initial Financial Statements have been, and
all financial statements to be furnished in accordance with subsection 6.1 will
be prepared in conformity with GAAP.
All information, reports and other papers and data furnished or to be
furnished to the Administrative Agent by any Borrower have been and will be, at
the time the same are so furnished to the Administrative Agent, accurate and
correct in all material respects and complete insofar as completeness may be
necessary to give the Administrative Agent a true and accurate knowledge of the
subject matter thereof. Since the date of the Initial Financial Statements,
there has been no Material Adverse Change.
5.4 Tangible Assets. Attached as Schedule 5.4 hereto is a list of all
of the right, title, and interest of the Borrowers in and to tangible assets, by
location and category, as of April 30, 1997, to be supplemented annually by an
Acceptable Supplement, with respect to items not previously listed, with an
individual book value or estimated fair market value of Twenty-Five Thousand and
00/100 Dollars ($25,000.00) or more.
5.5 Title to Collateral. Except as disclosed on Schedule 5.5 and
except as contemplated in subsection 7.2, all of the Collateral is free and
clear of all Liens. Each Borrower has good and valid title to all of the assets
reflected on its respective books and records as being owned by it. All
Collateral is and shall be kept only at the locations specified on Schedule 5.5,
as such Schedule may be supplemented, in writing by the Borrowers from time to
time as may be necessary to maintain the accuracy and completeness of the
information required to be disclosed therein, which supplement shall be
acceptable to the Administrative Agent unless the supplement reflects a Material
Adverse Change (any such supplement to any Schedule to this Agreement not
indicating a Material Adverse Change or which is otherwise acceptable to the
Administrative Agent being referred to as an "Acceptable Supplement"). The
Administrative Agent's security interests in, pledge of and mortgages in the
Collateral covered by the Loan Documents have been duly perfected and, as
necessary, recorded and no security interests, pledges or mortgages shall exist
on the Closing Date with respect to such Collateral, other than the security
interests, pledges and mortgages granted to the Administrative Agent under the
Loan Documents or Liens permitted by this Agreement.
5.6 Real Property; Leases. All real property owned, leased, or
occupied by the Borrowers, and all leases with respect thereto, are disclosed on
Schedule 5.6 attached hereto, as such Schedule may be supplemented in writing by
an Acceptable Supplement. Except as set forth in Schedule 5.6 or an Acceptable
Supplement, each Borrower enjoys peaceful and undisturbed possession of such
property subject to all leases, licenses for occupancy, or occupancy or use
agreements of real property, and all such leases, licenses for occupancy, or
occupancy or use agreements are valid and subsisting, in full force and effect;
to the best knowledge of Borrowers, no material default exists thereunder; and
all leases, licenses for use, or agreements for use of personal property are
valid and subsisting, in full force and effect, and no material default exists
thereunder.
5.7 Solvency. The Borrowers, taken as a whole, and Fine Host when
examined separately, will be able to pay their or its Indebtedness as the same
becomes due (including without limitation, all of the Liabilities). Each
Borrower (other than Fine Host), when examined separately, to the extent that it
receives proceeds of Extensions of Credit and has other Indebtedness, will be
able to pay its Indebtedness (including without limitation all of the
Liabilities) as the same becomes due; provided, however, that for this purpose,
its Indebtedness shall include Liabilities only to the extent of the proceeds of
Extensions of Credit received by such Borrower. The Borrowers, taken as a whole,
and each Borrower, when examined separately, (1) will have funds and capital
sufficient to carry on its business as now conducted or as contemplated to be
conducted; (2) owns property having a value both at fair valuation and at
present fair saleable value greater than the amount required to pay its debts as
they become due, including without limitation, all of the Liabilities (subject
in the case of each Borrower (other than Fine Host), to the foregoing proviso);
and (3) is not Insolvent and (subject in the case of each Borrower (other than
Fine Host), to the foregoing proviso) will not be rendered Insolvent as
determined by the Uniform Fraudulent Transfer Act, as adopted and in effect in
the Commonwealth of Massachusetts or any other applicable law. The Borrowers,
taken as a whole: (1)(A) are not Insolvent on the date hereof; and (B) are not
engaged in business or a transaction, or are not about to engage in business or
a transaction, for which, taking into account any property remaining with the
Borrowers, they would, taken as a whole, have an unreasonably small capital; or
(C) do not intend to incur, or believe that they would incur, Indebtedness that
would be beyond the ability of the Borrowers, taken as a whole, to pay as such
Indebtedness matures; or (2) are not transferring an interest in any Borrower,
or incurring an obligation which, under Section 548 of the Bankruptcy Code
(Title 11 of the United States Code), may be avoided. None of the Borrowers (a)
is considering the filing of a petition by it under any Insolvency Laws, or the
liquidation of all or a major portion of its respective properties; or (b) has
any knowledge of any Person contemplating the filing against any of them of any
such petition.
5.8 Tax Liabilities. Each Borrower has filed all Federal, state and
local tax reports and returns required by any Law to be filed thereby except for
extensions duly obtained, and has paid all taxes, assessments and other
governmental charges levied upon each of their respective properties, assets,
income or franchises, other than those not yet delinquent and those, not
substantial in aggregate amount, reserved against, or those being contested as
permitted by subsection 6.4. The charges, accruals and reserves on the books of
each Borrower in respect of its taxes are adequate in the opinion of such
Borrower, and each Borrower is not subject to any unpaid assessments for
additional taxes (other than any such assessments for amounts which would not
have a Material Adverse Effect) and do not know of any basis therefor.
5.9 Loans. Except as disclosed on and set forth in the Initial
Financial Statements or on Schedule 5.9 attached hereto or an Acceptable
Supplement, and except for trade payables and accrued expenses arising in the
ordinary course of the business of the Borrowers since the date of the Initial
Financial Statements, none of the Borrowers is obligated on any loans or other
Indebtedness for borrowed money as of the Closing Date (other than as permitted
under subsection 7.3).
5.10 Margin Securities. None of the Borrowers owns any margin
securities and none of the Loans advanced hereunder will be used for the purpose
of purchasing or carrying any margin securities or for the purpose of reducing
or retiring any Indebtedness which was originally incurred to purchase any
margin securities or for any other purpose not permitted by Regulation G or U of
the Board of Governors. If requested by the Administrative Agent, the Borrowers
will furnish the Administrative Agent with a statement in conformity with the
requirements of Federal Reserve Form G-1 or U-1 referred to in said Regulation.
No part of the proceeds of the Loans to be made hereunder will be used by any
Borrower for any purpose which violates, or which is inconsistent with, the
provisions of Regulation X of the Board of Governors.
5.11 Subsidiaries.
(a) Attached as Schedule 5.11(a) hereto is a true, complete
and accurate list and description of (i) the legal name and address of
each Corporate Subsidiary Borrower, (ii) the jurisdiction of
incorporation of each such Corporate Subsidiary Borrower, (iii) the
total number of authorized shares of Capital Stock of each such
Corporate Subsidiary Borrower, (iv) the total number of issued and
outstanding shares of Capital Stock of each such Corporate Subsidiary
Borrower and the names of the Persons to whom such shares are issued
and outstanding. Except as otherwise described in Schedule 5.11(a),
there are no outstanding options, warrant agreements, conversion
rights, preemptive rights or other rights to subscribe for, purchase or
otherwise acquire any unissued or treasury shares of Capital Stock in
any such Corporate Subsidiary Borrower.
(b) Attached as Schedule 5.11(b) hereto is a true, complete
and accurate list and description of (i) the legal name and address of
each Joint Venture Subsidiary Borrower, (ii) the jurisdiction of
organization of each such Joint Venture Subsidiary Borrower, if
applicable, and (iii) the amount of Joint Venture Interests owned by
each Borrower. Except as otherwise described in Schedule 5.11(b), there
are no outstanding options, warrant agreements, conversion rights,
preemptive rights or other rights to which any Borrower is a party to
subscribe for, purchase or otherwise acquire any Joint Venture
Interests in any such Joint Venture Subsidiary Borrower.
(c) Attached as Schedule 5.11(c) hereto is a true, complete
and accurate list and description of (i) the legal name and address of
each LLC Subsidiary Borrower, (ii) the jurisdiction of organization of
each such LLC Subsidiary Borrower, and (iii) the amount of Membership
Interests owned by each Borrower. Except as otherwise described in
Schedule 5.11(c), there are no outstanding options, warrant agreements,
conversion rights, preemptive rights or other rights to which any
Borrower is a party to subscribe for, purchase or otherwise acquire any
Membership Interests in any such LLC Subsidiary Borrower.
There are no Subsidiaries other than those Subsidiaries described
herein or in an Acceptable Supplement. Except as set forth on Schedules 5.11(a),
5.11(b) and 5.11(c) none of the Borrowers owns or holds, directly or indirectly,
any capital stock or equity security of, or any equity interest in, any Person
other than as disclosed herein, as so supplemented. The Borrowers shall
supplement Schedule 5.11(a), Schedule 5.11(b), and Schedule 5.11(c), from time
to time as required by Acceptable Supplements.
5.12 No Material Litigation. Except as disclosed on Schedule 5.12, no
judgments are outstanding against any Borrower nor is there now pending or, to
the knowledge of any Borrower, threatened, any litigation, contested claim, or
federal, state or municipal governmental proceeding by or against any Borrower
or, to the best of each of their knowledge after due inquiry, any basis
therefor, which litigation, claim or proceeding could reasonably be expected to
result in a Material Adverse Effect. The Borrowers shall supplement such
schedule with an Acceptable Supplement from time to time which schedule shall be
deemed an Acceptable Supplement if all material threatened or pending litigation
and proceedings (including but not limited to all material threatened or pending
litigation and proceedings between any Borrower and another party to a Facility
Agreement) are accurately described therein.
5.13 SEC Filings.
(a) None of the registration statements or reports (including, without
limitation, reports on Form 10-K, Form 10-Q and Form 8-K) filed by Fine Host
with the SEC, as amended, modified or supplemented, from time to time, contained
as of the date thereof any untrue statement of a material fact or omitted to
state any material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.
(b) No representation or warranty made by any Borrower herein or in any
other certificate furnished from time to time in connection herewith, contains
or will contain any misrepresentation of a material fact or omits or will omit
to state any material fact necessary to make the statements herein or therein
(taken as a whole in conjunction with all such documents) not misleading when
made. To the best of each Borrower's knowledge, there is no condition specific
to the business of the Borrowers which adversely affects, or which would in the
future adversely affect, the business, operations, property or financial
condition of the Borrowers in a manner which would materially adversely affect
the Collateral or the ability of the Borrowers to perform all of their
obligations under this Agreement and the other Loan Documents.
5.14 Material Agreements. Attached as Schedule 5.14 hereto is a true,
complete and accurate list of all material agreements as of the Closing Date
(including all amendments thereto), oral or written, involving the payment or
expenditure of One Hundred Thousand and 00/100 Dollars ($100,000.00) or more
(other than sales or purchase orders entered into in the ordinary course of
business of any Borrower) (i) to which any Borrower is a party, (ii) by which
any assets of any Borrower are bound, or (iii) to which any director, officer,
shareholder or Affiliate of any of the foregoing is a party or which any agent
of any of the foregoing has entered into, in any such case, on behalf of any
Borrower, including without limitation, all leases and management, maintenance,
brokerage, supply and service contracts and any contract, agreement or other
arrangement providing for the employment of, furnishing of services to or by,
any Borrower, any director, officer or shareholder thereof, or any Affiliate of
any of the foregoing. A true, correct and complete copy of all of the agreements
(including all amendments thereto) as set forth on Schedule 5.14 has previously
been furnished to the Administrative Agent. As of the Closing Date, neither any
Borrower nor any officer, director, shareholder or Affiliate of any Borrower is
in default under any such material agreement which could reasonably be expected
to have a Material Adverse Effect. The execution and delivery of the Loan
Documents was not and is not a default under of any of the agreements listed on
Schedule 5.14. As of the date hereof, the Borrowers know of no dispute regarding
any contract, lease, or commitment which would have a Material Adverse Effect
or, to the best of their knowledge, after due inquiry, any basis therefor.
5.15 Employee Controversies and Employment and Labor Agreements.
(a) There are no controversies pending or, to the best of the knowledge
of the Borrowers after due inquiry, threatened, between any Borrower and any of
its employees, other than employee grievances arising in the ordinary course of
business which are not, in the aggregate, material to the financial condition,
results of operation or business of the Borrowers, taken as a whole. Each
Borrower is in compliance with all federal and state laws respecting employment
and employment terms, conditions and practices the failure to comply with which
could have a Material Adverse Effect. None of the Borrowers has union
representation questions, grievances, discrimination or unfair labor practice
complaints pending or threatened against it before any state or federal board or
agency respecting employment and employment terms, conditions and practices the
failure to comply with which could have a Material Adverse Effect or, to the
best of their knowledge, after due inquiry, any basis therefor, except as set
forth on Schedule 5.15 or on an Acceptable Supplement.
(b) Except as set forth in Schedule 5.15, (i) none of the Borrowers is
a party as of the Closing Date to any outstanding employment agreements or
contracts with officers or employees that are not terminable at will, or that
provide for the payment of any bonus or commission; (ii) as of the Closing Date,
none of the Borrowers is a party to any agreement, policy or practice that
requires it to pay termination or severance pay to salaried, non-exempt or
hourly employees (other than as required by law); (iii) none of the Borrowers is
a party to any collective bargaining agreement or other labor union contract
applicable to persons employed by the Borrowers nor does any Borrower know of
any activities or proceedings of any labor union to organize any such employees,
except in any such case as may be set forth on an Acceptable Supplement. Each
Borrower has furnished to the Agent complete and correct copies of all such
agreements ("Employment and Labor Agreements"). None of the Borrowers has
breached or otherwise failed to comply in any material respect with any
provisions of any Employment and Labor Agreement, and there are no material
grievances outstanding thereunder, except in any such case as may be set forth
on an Acceptable Supplement.
5.16 Material Licenses.
(a) Schedule 5.16(a) attached hereto sets forth, as of the Closing
Date, a true and complete list of all material licenses and permits (including,
but not limited to, any license relating to alcoholic beverages, beer, wine or
liquor (but excluding motor vehicle registrations and licenses or permits (other
than liquor licenses) relating to food or tobacco or related services (including
those required by health authorities), safety (such as those required for fire
protection) or other normal operating matters if such licenses or permits are
generally obtainable or renewable by any Borrower in the ordinary course and
without material difficulty), franchises, authorizations and approvals issued or
granted to each Borrower by the United States, any state or local government,
any foreign national or local government, or any department, agency, board,
commission, bureau of instrumentality of any of the foregoing (each a "License",
and, collectively, the "Licenses"), and all pending applications therefor. Such
list contains a summary description of each such License and, where applicable,
specifies the date issued, granted or applied for, the expiration date and the
current status thereof. Except as set forth in Schedule 5.16(a) attached hereto,
each License has been issued to, and duly obtained and fully paid for by, the
holder thereof and is valid, in full force and effect, and not subject to any
pending or threatened administrative or judicial proceeding to suspend, revoke,
cancel or declare such License invalid in any respect. The Borrowers shall
supplement Schedule 5.16(a) with an Acceptable Supplement provided with each
financial statement required under subsection 6.1(a).
(b) Each Borrower has all Licenses required, and such Licenses are
sufficient and adequate in all respects, to permit the continued lawful conduct
of business of each such Borrower in the manner now conducted and the ownership,
occupancy and operation of its real property for its present use. Except as set
forth in Schedule 5.16(b), attached hereto or as may be set forth in an
Acceptable Supplement: (i) none of the Borrowers is in violation of any of the
Licenses; (ii) none of the operations of any Borrower is being conducted in a
manner that violates any of the terms or conditions under which any License was
granted; (iii) none of the Licenses of any Borrower relating to alcoholic
beverages, beer, wine or liquor has ever been suspended, revoked or otherwise
terminated, or subject to judicial or administrative review, for any reason
other than the renewal or expiration thereof nor has any application by any
Borrower of any of such Licenses ever been denied; and (iv) no License will in
any way be affected by, or terminate or lapse by reason of, the transactions
contemplated by the Loan Documents or the Subordinated Debt Documents, if, in
any case referred to in clause (i), (ii), (iii) or (iv) above, such matter would
result in a Material Adverse Effect.
5.17 Intellectual Property Rights. Each Borrower possesses and will
possess adequate assets, licenses, patents, patent applications, copyrights,
service marks, trademarks, trademark applications, tradestyles and tradenames to
continue to conduct its business as heretofore conducted by it. None of the
Borrowers has been charged or, to each of their knowledge, has been threatened
to be charged with, any infringement of, nor has any of them infringed on, any
unexpired trademark, trademark registration, tradename, patent, copyright,
copyright registration, or other proprietary right of any other Person, which
infringement could have a Material Adverse Effect.
5.18 Pension Related Matters. Each Plan maintained by any Borrower or
any ERISA Affiliate complies, and has been administered in accordance with its
terms and all material applicable requirements of ERISA and of the Tax Code and
with all material applicable rulings and regulations issued under the provisions
of ERISA and the Tax Code setting forth those requirements. No Reportable Event,
Prohibited Transaction or withdrawal from a Multiemployer Plan has occurred and
no Accumulated Funding Deficiencies exist with respect to any Plan or
Multiemployer Plan which could have a Material Adverse Effect. The Borrowers and
each ERISA Affiliate have satisfied all of the funding standards applicable to
such Plans and Multiemployer Plans under Section 302 of ERISA and Section 412 of
the Tax Code and the PBGC has not instituted any proceedings, and there exists
no event or condition which would constitute grounds for the institution of
proceedings by the PBGC, to terminate any Plan or Multiemployer Plan under
Section 4042 of ERISA which could have a Material Adverse Effect. Neither the
Borrowers nor any ERISA Affiliate has taken any steps to terminate any Plan,
which termination could have a Material Adverse Effect. Neither the Borrowers
nor any ERISA Affiliate has taken any steps to terminate its participation in
any Multiemployer Plan or withdraw from any Multiemployer Plan. The Borrowers
and each ERISA Affiliate have made all contributions to each Plan and each
Multiemployer Plan to which it has become obligated to contribute as to which
the failure to make contributions could have a Material Adverse Effect. The
Borrowers are not aware of any assessments or assertions of withdrawal liability
against them or any ERISA Affiliate with respect to any Plan or Multiemployer
Plan. The aggregate potential withdrawal liability under all Multiemployer Plans
to which the Borrowers and each ERISA Affiliate are obligated to contribute is
less than an amount which, if all such liabilities were incurred, could have a
Material Adverse Effect.
5.19 Environmental Matters. Except as disclosed on Schedule 5.19, as
supplemented by any Acceptable Supplement: (a) each Borrower has complied in all
material respects with Environmental Laws regarding transfer, construction on
and operation of the business and property, including but not limited to
notifying authorities, observing restrictions on use, transferring, modifying or
obtaining permits, licenses, approvals and registrations, making required
notices, certifications and submissions, complying with financial liability
requirements, Managing Hazardous Substances, and Responding to the presence or
Release of Hazardous Substances connected with operation of its business or
property; (b) none of the Borrowers has any material contingent liability with
respect to the Management of any Hazardous Substance; (c) during the term of
this Agreement, none of the Borrowers shall, nor shall any Borrower permit
others to, manage, whether on or off the property of any Borrower, Hazardous
Substances except in full compliance with Environmental Laws; (d) each Borrower
shall take prompt action in full compliance with Environmental Laws to Respond
to the on-site or off-site Release of Hazardous Substances connected with
operation of its business or property; (e) none of the Borrowers has received
any Environmental Notice; and (f) to the best of the knowledge of the Borrowers,
no conditions exist on property owned or leased, or previously owned or leased,
by any Borrower which would result in issuance of an Environmental Notice to any
Borrower. Any supplemental Schedule 5.19 filed shall be deemed to be an
Acceptable Supplement with respect to Environmental Notices if it reflects all
Environmental Notices which would result in a Material Adverse Effect and any
Environmental Notice from any governmental agency or authority.
5.20 Broker's Fee. None of the Borrowers is in any way obligated to
any Person in respect of any finder's or broker's fee or similar commission in
connection with the transactions contemplated by this Agreement. Each of the
Borrowers agrees to indemnify the Agents and the Banks and hold the Agents and
the Banks harmless from and against any claims for any such fee or commission by
any such Person.
5.21 Securities Matters. The making of the Loans hereunder, the
application of the proceeds and repayment thereof by the Borrowers and the
consummation of the transactions contemplated by this Agreement have not and
will not violate any provision of any federal or state securities statutes,
rules or regulations, or any order issued by the SEC (collectively, "Securities
Laws"). None of the Borrowers has issued any securities in violation of any
Securities Law. Promptly upon the filing thereof, each such Borrower shall
deliver to the Administrative Agent a true and complete copy of each statement,
document and report, periodic or otherwise, filed pursuant to any Securities
Law. The Borrowers agree to indemnify the Agents and the Banks and hold the
Agents and the Banks harmless from and against the claims of any Person in
connection with the violation or alleged violation by any Borrower of any
Securities Laws.
5.22 Disclosure. No written information provided or statements made by
any of the Borrowers, or any other Affiliate of any Borrower in connection with
this transaction, or any of the representations and warranties to the Banks
herein or in any of the Loan Documents contains any untrue statement of a
material fact or omits to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The Borrowers have disclosed to the Administrative Agent in writing,
every fact of which they are aware (other than those relating to general
economic matters or matters of public knowledge) which, insofar as the Borrowers
can reasonably foresee, might materially and adversely affect the business
prospects, operations or financial condition of the Borrowers taken as a whole
or the ability of each of the Borrowers to perform their respective obligations
hereunder or under any other Loan Documents.
5.23. Facility AgreementsFacility Agreements. The Borrower Agent shall
submit to the Administrative Agent within 10 days after the date of consummation
of each New Project or Permitted Acquisition, as the case may be, (i) a copy of
the related Facility Agreement if it exists, or, if it does not exist, the
proposed form of the Facility Agreement which will be in effect upon the
commencement of its term, and (ii) copies of all market studies, pro forma
financial statements and business plans and studies prepared in connection with
such New Project or Permitted Acquisition.
5.24 Security DocumentsSecurity Documents. The provisions of the
Security Documents executed or to be executed by each Borrower in favor of the
Administrative Agent shall, upon the due execution and delivery thereof in
accordance herewith, together with the making of all filings and recordings in
locations required by subsection 4.1(b) and the taking of possession of the
Collateral in accordance with the provisions of the Security Documents, be
effective to create, in favor of the Administrative Agent, for the ratable
benefit of the Banks, a valid and perfected first priority Lien in all right,
title and interest of each such Borrower in and to the Collateral, subject to
such Liens which are otherwise permitted by this Agreement and the other Loan
Documents.
5.25 Subordinated DebtSubordinated Debt. Attached as Schedule 5.25
hereto is a true, correct and complete description of all of the Subordinated
Debt, as of the Closing Date, to be supplemented quarterly by an Acceptable
Supplement. Each of the Borrowers hereby covenants to perform, comply with and
be bound by for the ratable benefit of the Banks at all times all of its
agreements, covenants, and obligations in the Subordinated Debt Documents. Each
of the Borrowers will not, without the consent of the Required Banks, permit any
modification or waiver of or change in any subordination provisions contained in
any of the Subordinated Debt Documents.
6. CERTAIN AFFIRMATIVE COVENANTS.
The Borrowers jointly and severally covenant and agree, so long as the
Commitments remain in effect or any amount is owing to any Bank, the
Administrative Agent or the Documentation Agent hereunder or under any other
Loan Document or any Letter of Credit remains outstanding, that:
6.1 Financial Statements. Each Borrower shall keep proper books of
record and account in which full and true entries will be made of all dealings
or transactions of or in relation to the business and affairs of each such
Borrower, in accordance with GAAP, and the Borrower Agent shall cause to be
furnished to the Administrative Agent, and upon receipt, the Administrative
Agent shall promptly furnish to the Banks as soon as reasonably practicable,
copies of the following financial statements, reports and information, all in
accordance with the notice provisions of subsection 10.12:
(a) as soon as they become available and are filed with the SEC, but in
any event within fifty (50) days after the close of each fiscal quarter (other
than the last fiscal quarter) of the Borrowers, consolidated balance sheets at
the close of such fiscal quarter, and consolidated statements of income,
stockholders' equity and cash flows for such fiscal quarter and for the period
commencing at the close of the previous fiscal year and ending with the close of
such fiscal quarter of the Borrowers (with comparable information at the close
of and for the corresponding fiscal quarter of the prior fiscal year and for the
corresponding portion of such prior fiscal year), certified by the Chief
Executive Officer, Chief Financial Officer or Treasurer of the Borrower Agent
(provided that the requirements of this clause (a) for any fiscal quarter may be
satisfied by delivery of a copy of Fine Host's Quarterly Report on Form 10-Q for
such quarter);
(b) as soon as they become available and are filed with the SEC, but in
any event within ninety-five (95) days after the close of each fiscal year of
the Borrowers, consolidated balance sheets at the close of such fiscal year, and
consolidated statements of income, stockholders' equity and cash flows for such
fiscal year (with comparable information for the prior fiscal year), in each
case as audited (without any Impermissible Qualification) by a firm of
independent public accountants of nationally recognized standing acceptable to
the Administrative Agent (provided that the requirements of the foregoing
provisions of this clause (b) for any fiscal year may be satisfied by delivery
of a copy of Fine Host's Annual Report on Form 10-K for such year), together
with a certificate from such accountants to the effect that, in making the
examination necessary for the signing of such annual report by such accountants,
they have not become aware of any Default or Event of Default that has occurred
and is continuing, or, if they have become aware of such Default or Event of
Default, describing such Default or Event of Default;
(c) as soon as it becomes available, but in any event within
thirty-five (35) days after the close of each fiscal month of the Borrowers, an
Operating Results and Comparison Schedule as to contract and venue performance
for such fiscal month, in substantially the form delivered by the Borrower Agent
to the Administrative Agent prior to the Closing Date;
(d) as soon as it becomes available, but in any event within fifty (50)
days after the close of each fiscal year of the Borrowers, a budget for the next
succeeding fiscal year of the Borrowers, which budget shall be prepared on a
fiscal month basis and shall contain a projected consolidated balance sheet and
statements of earnings and cash flows of the Borrowers for such succeeding
fiscal year, certified by the Chief Executive Officer, Chief Financial Officer
or Treasurer of the Borrower Agent;
(e) concurrently with the delivery of the financial statements referred
to in subsections 6.1(a) and (b), a certificate from the Chief Executive
Officer, Chief Financial Officer or Treasurer of the Borrower Agent, (i) stating
that, to the best of such officer's knowledge, and except as specified in such
certificate, no Default or Event of Default has occurred and is continuing, and
there does not now exist any circumstance or set of facts, which with the
passage of time or the giving of notice or both, would constitute or result in a
Default or an Event of Default, and (ii) setting forth in reasonable detail the
calculations required to determine compliance with subsection 7.1;
(f) promptly, but in any event within five (5) days after any Borrower
obtains knowledge of any of the following, a statement of the Chief Executive
Officer, Chief Financial Officer or Treasurer of the Borrower Agent setting
forth in reasonable detail the nature thereof and the action which the Borrowers
have taken and propose to take with respect thereto: (i) the occurrence of any
litigation, arbitration or governmental investigation or proceeding not
previously disclosed by the Borrowers pursuant hereto which has been instituted
or, to the knowledge of any Borrower, is threatened against, any Borrower or to
which any of its properties, assets or revenues is subject which, if adversely
determined, might have a Material Adverse Effect; (ii) the occurrence of any
circumstance which has a reasonable likelihood of having a Material Adverse
Effect; (iii) any material adverse development which shall occur in any
litigation, arbitration or governmental investigation or proceeding previously
disclosed by any Borrower; (iv) the occurrence of any Default; and (v) the
occurrence of a Reportable Event (as defined in ERISA) under, or the institution
of steps by the Borrower or any of its Subsidiaries to withdraw from, or the
institution by the PBGC or otherwise of any steps to terminate, any employee
benefit plan covered by Title IV of such Act;
(g) promptly upon the receipt thereof and in any event within ten (10)
Business Days, copies of all detailed management reports submitted to any
Borrower by its independent public accountants;
(h) as soon as it becomes available, but in any event within fifteen
(15) days of delivery to any Borrower, a copy of any management or other letter
issued by a public accounting firm or other management consultants with respect
to the financial or accounting systems or controls of the Borrowers;
(i) the response of any Borrower to any of the matters referenced in
any letter issued by a public accounting firm or other management consultants
with respect to the financial or accounting systems or controls of such Borrower
at such time as such Borrower delivers such response to such firm or
consultants, and upon receipt by such Borrower of any reply thereto, a copy
thereof to the Administrative Agent;
(j) as soon as they become available, but in any event, within fifteen
(15) days after the issuance thereof, Fine Host shall furnish to the
Administrative Agent copies of such other financial statements, proxy material
and reports as it shall send or make available to its stockholders, and promptly
upon the filing thereof, copies of all reports and materials which any Borrower
files with any governmental commission (including, without limitation, the SEC),
department or agency or with any domestic or foreign stock exchange or with the
NASDAQ, including without limitation, copies of (i) any registration statements,
prospectuses and any amendments and supplements thereto, and any regular and
periodic reports (including, without limitation, reports on Form 10-K, Form 10-Q
and Form 8-K) filed by any Borrower with the SEC or any domestic or foreign
stock exchange or with the NASDAQ; and (ii) any letters of comment or
correspondence with respect to filings or compliance matters sent to any
Borrower by any such governmental commission (including without limitation, the
SEC), department or agency or any such domestic or foreign stock exchange or the
NASDAQ; provided that the foregoing provisions shall not apply to reports,
materials, letters or correspondence (other than those filed with or received
from the SEC) filed or received by any Borrower in the ordinary course of
business or which otherwise do not involve matters that could result in a
Material Adverse Effect; and
(k) such other information with respect to the financial condition,
business, property, assets, revenues and operations of any Borrower as the
Administrative Agent may from time to time reasonably request.
All financial statements delivered to the Administrative Agent pursuant
to the requirements of this subsection 6.1(except where otherwise expressly
indicated) shall be prepared in accordance with GAAP on a consolidated basis.
The Administrative Agent and the Banks acknowledge that Fine Host is a reporting
company under the Securities Exchange Act of 1934, as amended, and that its
common stock is publicly traded, and agree to keep all information acquired
pursuant to this subsection 6.1 or under any other provision of the Loan
Documents, or as a result of any inspection conducted in accordance with
subsection 6.2 below, confidential; provided that the Banks may, in their sole
discretion, communicate such information (t) to any holder of Subordinated Debt,
(u) with the prior consent of the Borrower Agent (not to be unreasonably
withheld), to any other Person in accordance with its customary practices
relating to routine trade inquiries, (v) to any court or regulatory authority
having jurisdiction over the Banks or any of them or as required by law or legal
process, (w) to any other Person in connection with the Banks' sale of any
interests or participations in the Liabilities, (x) to any other Person in
connection with any litigation involving any Borrower and any Bank, (y) to
counsel, auditors or other professional advisors and to affiliates of any of the
Banks or (z) to any other Person in connection with the exercise of the
Administrative Agent's or the Banks' rights hereunder or under any of the other
Loan Documents, it being the intent of this sentence not to create rights in and
to such documents to any Person other than the Administrative Agent and the
Banks; provided that the foregoing restrictions shall not apply to any
information that Fine Host has made publicly available. The Borrowers authorize
the Administrative Agent to discuss the financial condition of the Borrowers
with the independent certified public accountants for the Borrowers and agree
that such discussion or communication shall be without liability to the
Administrative Agent or the Banks. Upon the Administrative Agent's review of any
management or other letter issued by a public accounting firm or other
management consultants, the Borrowers agree to address, in a manner reasonably
satisfactory to the Administrative Agent, any matter addressed therein or
explain, to the Administrative Agent's reasonable satisfaction, the positions of
the Borrowers with respect thereto why such matter will not be addressed.
6.2 Inspection. The Administrative Agent and/or the Banks shall have the
right, from time to time hereafter upon reasonable notice, to call at any
Borrower's place of business (or any other place where the Collateral or any
information relating thereto is kept or located) during ordinary business hours,
and, without hindrance or delay (except to the extent that the rights of third
parties would be violated or unless an order from a competent court is issued
allowing enforcement of the Administrative Agent's rights despite the alleged
violation of the rights of such third parties), (a) to inspect, audit, check and
make copies of and extracts from any Borrower's books, records, journals,
orders, receipts and any correspondence and other data relating to any
Borrower's business or to any transactions between the parties hereto, (b) to
make such verification concerning the Collateral as the Administrative Agent may
consider reasonable under the circumstances, and (c) to discuss the affairs,
finances and business of any Borrower with any officers, employees or directors
of the Borrower.
6.3 Conduct of Business. Except as provided herein, each Borrower shall
maintain its legal existence, shall maintain in full force and effect all
licenses, permits, authorizations, bonds, franchises, leases, patents,
contracts, and other rights necessary or desirable to the profitable conduct of
its respective business, shall continue in, and shall limit its operations to,
the same or complementary general lines of business as those currently conducted
(which is providing catering or concession services at recreational and leisure
facilities, convention centers, schools and institutions) and comply with all
applicable Laws, except for such Laws the violation of which would not, in the
aggregate, have a Material Adverse Effect. None of the Borrowers shall permit
any default by any Borrower to occur under any mortgage or other Lien that
encumbers any real property leased by any Borrower. Each Borrower shall
maintain, preserve and protect all trade names, trade marks, copyrights and
patents and all other property necessary to the conduct of each of its
businesses and keep all tangible property in good repair, working order and
condition, ordinary wear and tear excepted.
6.4 Claims and Taxes. Each Borrower agrees to indemnify and hold the
Administrative Agent and the Banks harmless from and against any and all claims,
demands, liabilities, losses, damages, penalties, costs, and expenses (including
reasonable attorneys' and other professionals' fees and disbursements) relating
to or in any way arising out of the possession, use, operation or control of the
assets of any Borrower (other than any such claims, demands, liabilities,
losses, damages, penalties, costs or expenses attributable to the gross
negligence or wilful misconduct of the Administrative Agent or the Banks or any
of their respective officers, directors, employees or agents). The Borrowers
shall pay or cause to be paid all license fees, bonding premiums and related
taxes and charges, and pay or cause to be paid all of the real and personal
property taxes of any Borrower, all assessments and charges of any Borrower, and
all franchise, income, unemployment, use, excise, old age benefit, withholding,
sales and other taxes and other governmental charges assessed against any
Borrower, or payable by any Borrower, at such times and in such manner as to
prevent any penalty from accruing or any Lien from attaching to its property;
provided however that the Borrowers shall have the right to contest in good
faith, by an appropriate proceeding promptly initiated and diligently conducted,
the validity, amount or imposition of any such tax, assessment or charge, and
upon such good faith contest, to delay or refuse payment thereof, if (a) the
applicable Borrower establishes adequate reserves, in accordance with GAAP, to
cover such contested taxes, assessments or charges, and (b) such contest does
not have a Material Adverse Effect, or a material adverse effect on the priority
or value of the Administrative Agent's Lien on the Collateral.
6.5 Costs and Expenses of Agents and Banks as Additional Liabilities. The
Borrowers shall reimburse the Agents for all reasonable expenses and fees paid
or incurred by the Agents in connection with (a) the documentation, negotiation
and closing of the Loans and other transactions described herein and in the
other Loan Documents, and (b) any amendment, waiver or consent executed in
connection with this Agreement or any of the other Loan Documents. The Borrowers
shall also reimburse each of the Agents and the Banks for all reasonable
expenses and fees paid or incurred by the Banks and the Agents in connection
with the enforcement or preservation of the rights of any of the Agents or the
Banks under this Agreement and any of the other Loan Documents (including
without limitation appraisal, stamp, document, transfer filing and recording
fees and the reasonable fees and expenses of the auditors, attorneys and
paralegals of the Agents and the Banks). All such costs and expenses incurred by
the Agents and the Banks with respect to the documentation, negotiation,
enforcement, collection and protection of the interests of the Administrative
Agent in the Collateral (including without limitation the cost of such equipment
and real estate appraisals and environmental update inspections as may hereafter
be reasonably required by the Administrative Agent), shall be additional
Liabilities, payable on demand or otherwise repaid as provided herein, and
secured by the Collateral. The agreements in this subsection shall survive
repayment of the Loans and all other amounts payable hereunder.
6.6 Insurance. Each Borrower shall, at its expense, maintain with
reputable, financially sound insurance companies, insurance with respect to its
properties and business against such liabilities and contingencies and of such
types and in such amounts as is customary in accordance with prudent business
practice in the case of similar businesses in similar locations, and are
reasonably acceptable to the Administrative Agent (including without limitation,
public liability insurance, third party property damage insurance and liquor
liability insurance). All such policies of insurance shall be in form and
substance reasonably satisfactory to the Administrative Agent and shall have
deductibles not exceeding Twenty-Five Thousand and 00/100 Dollars ($25,000.00).
The Borrower Agent shall deliver to the Administrative Agent the original (or a
certified copy) of each policy of insurance for each Borrower and evidence of
payment of all premiums therefor. All of the policies of insurance pertaining to
each such Borrower's assets shall contain an endorsement, in form and substance
reasonably satisfactory to the Administrative Agent, showing all losses payable
to the Administrative Agent as provided below in this subsection 6.6; provided,
that such policies may show loss payees in addition to the Administrative Agent
in connection with the lease or purchase money financing of equipment or real
estate by each such Borrower and if such other loss payees have no interest in
the proceeds of any loss relating to the Collateral, other than the specific
assets that are the subject of such lease or purchase money financing. Such
endorsement, or an independent instrument furnished to the Administrative Agent,
shall provide that such insurance company will give the Administrative Agent at
least thirty (30) days' prior written notice before any such policy or policies
of insurance shall be altered or cancelled and that no act or default of any
Borrower shall affect the right of the Administrative Agent to recover under
such policy or policies of insurance in case of loss or damage. All insurance
policies referred to in this subsection 6.6 shall name the Administrative Agent
as an additional loss payee with respect to all claims relating to the
Collateral resulting in payments of Five Hundred Thousand and 00/100 Dollars
($500,000.00) or less, and as additional insured and sole loss payee in respect
of each claim relating to the Collateral resulting in a payment under any such
insurance policy exceeding Five Hundred Thousand and 00/100 Dollars
($500,000.00). Provided that no Default or Event of Default then exists, the
Administrative Agent agrees promptly upon its receipt thereof, to pay over to
the Borrower Agent the proceeds of such payment to enable the Borrowers to
repair, restore, or replace the Collateral subject to such claim. To the extent
that the Borrowers elect not to repair, restore or replace such Collateral, any
such proceeds in excess of Five Hundred Thousand and 00/100 Dollars
($500,000.00) shall be deposited with the Administrative Agent, which deposit
shall be invested by the Administrative Agent in Cash Equivalents and shall be
held by the Administrative Agent as additional Collateral for the Liabilities.
If the Borrower Agent certify to the Administrative Agent, on or prior to thirty
(30) days after receipt by any Borrower of such insurance proceeds that the
Borrowers intend to use such insurance proceeds to construct replacement
property or repair the damaged property within three hundred sixty-one (361)
days after the receipt of such insurance proceeds, the Administrative Agent
shall, if no Default has occurred and is then continuing, release to the
Borrower Agent that part of the insurance proceeds to be used for the
aforementioned purposes. To the extent that the Borrower Agent does not provide
such certification, all of such insurance proceeds shall be used by the
Administrative Agent to prepay in full to the extent possible the Guidance Loans
for the facility to which such insurance proceeds are applicable, with any
remaining proceeds to be used to prepay other Guidance Loans in accordance with
subsection 3.1(b). In addition, if any of the insurance proceeds previously
released are not in fact applied in the manner specified in such certification,
the Borrowers shall pay to the Administrative Agent, on which the date which is
three hundred sixty-one (361) days after the receipt of such insurance proceeds
by any Borrower, an amount equal to the insurance proceeds released by the
Administrative Agent to the Borrowers pursuant to this subsection 6.6 (less
amounts actually spent for the purposes specified in such certification) and
such amount shall be applied to the prepayment of the Guidance Loans in
accordance with subsection 3.1(b). All such proceeds otherwise on deposit with
the Administrative Agent on the date which is three hundred sixty-one (361) days
after receipt of such insurance proceeds by any Borrower shall also be used by
the Administrative Agent to prepay in full to the extent possible the Guidance
Loans for the facility to which such insurance proceeds are applicable, with any
remaining proceeds to be used to prepay other Guidance Loans in accordance with
subsection 3.1(b). In addition, such proceeds may also be used, in the
Administrative Agent's sole discretion, to meet the obligation of the Borrowers
to reimburse the Banks as a result of any draw under any Letter of Credit. The
Administrative Agent shall apply any such proceeds not so used first to amounts
due under the Guidance Loans, and if any proceeds should remain thereafter, to
the reduction of the Liabilities in such manner as the Administrative Agent
shall determine. If a Default or an Event of Default exists, the Administrative
Agent shall (a) hold the proceeds of such payment as additional Collateral for
the Loans until such Default or Event of Default shall no longer exist and then,
subject to the foregoing provisions of this subsection 6.6, pay over the same to
the Borrower Agent for the repair, restoration, or replacement of the Collateral
subject to such claim. The Borrowers hereby direct all insurers under such
policies of insurance to pay all proceeds of insurance policies directly to the
Administrative Agent as and to the extent set forth above. The Borrowers
irrevocably make, constitute and appoint the Administrative Agent (and all
officers, employees or agents designated by the Administrative Agent) as the
true and lawful attorney-in-fact of each such Borrower for the purpose, after
and during the continuance of a Default or an Event of Default, of making,
settling and adjusting claims under all such policies of insurance, endorsing
the name of any Borrower on any check, draft, instrument or other item of
payment received by any Borrower or the Administrative Agent pursuant to any
such policies of insurance and making all determinations and decisions with
respect to such policies of insurance. If any Borrower, at any time or times
hereafter, shall fail to obtain or maintain any of the policies of insurance
required above or to pay any premium in whole or in part relating thereto, then
the Administrative Agent, without waiving or releasing any obligation or default
by any Borrower hereunder, may at any time or times thereafter (but shall be
under no obligation to do so) obtain and maintain such policies of insurance and
pay such premiums and take any other action with respect thereto which the
Administrative Agent deems advisable, and the amount so expended, together with
interest thereon at the rate applicable to the Guidance Loans, shall be part of
the Liabilities, payable on demand or otherwise repaid as provided herein and
secured by the Collateral. Notwithstanding anything in this subsection 6.6 to
the contrary, in the event insurance proceeds result from a casualty to property
used in connection with a Facility Agreement, and such Facility Agreement is no
longer in force as of the date of payment of insurance proceeds by the insurer
or before such proceeds are used to repair, replace or restore such property,
then the full amount of such proceeds (up to the outstanding amount of any
Guidance Loan related to such Facility Agreement), shall be paid to the
Administrative Agent to retire such Guidance Loan, before the application of the
other provisions of this subsection 6.6.
6.7 Pension Plans. Each Borrower shall, and shall (to the extent within the
control of any Borrower) cause each ERISA Affiliate to, (a) make contributions
to all of the Plans (including any Multiemployer Plans) in a timely manner and
in a sufficient amount to comply with the requirements of ERISA; (b) comply with
all material requirements of ERISA and the Tax Code which relate to such Plans
and Multiemployer Plans, the failure to comply with which would if applicable to
such Borrower or any ERISA Affiliate, have a Material Adverse Effect; (c) notify
the Administrative Agent immediately upon receipt by such Borrower of any notice
of the institution of any proceeding or other action which may result in the
termination of any Plans or Multiemployer Plans; and (d) immediately notify the
Administrative Agent of the occurrence of an ERISA Termination Event. None of
the Borrowers shall fail to make any payments to any Multiemployer Plan that any
Borrower or any ERISA Affiliate of any Borrower under ERISA may be required to
make under any agreement relating to any Multiemployer Plan or any Law
pertaining thereto except any payments being contested in good faith with
respect to which any such Borrower has established adequate reserves.
6.8 Notice of Suit. The Borrower Agent shall, as soon as possible, and in
any event within five (5) Business Days after the Borrower Agent learns thereof,
give written notice to the Administrative Agent of any proceeding(s) being
instituted or threatened to be instituted by or against any Borrower in any
federal, state, local or foreign court or before any arbitration or mediation
panel, commission or other regulatory body (federal, state, local or foreign);
provided, that the Borrower Agent shall not be required to notify the
Administrative Agent of any such proceeding instituted or threatened to be
instituted unless such proceeding could, individually, or when aggregated with
other outstanding proceedings, if adversely determined, have a Material Adverse
Effect.
6.9 Environmental Notices. The Borrowers shall promptly notify and furnish
the Administrative Agent with a copy of any and all Environmental Notices which
would result in a Material Adverse Effect and any Environmental Notice from any
Governmental Authority which is received by any Borrower. The Borrowers shall
take prompt and appropriate action in response to any and all such Environmental
Notices and shall promptly furnish the Administrative Agent with a description
of the Borrowers' response thereto.
6.10 Use of Proceeds. Proceeds of the Loans shall be used solely for the
business purposes of the Borrowers, in accordance with the terms and provisions
of this Agreement and the other Loan Documents.
6.11 Maintenance of Liens of Security Documents. The Borrowers will
promptly, upon the reasonable request of the Administrative Agent, at the sole
expense of the Borrowers, execute, acknowledge and deliver, or cause the
execution, acknowledgement and delivery of, and thereafter register, file or
record, or cause to be registered, filed or recorded, in an appropriate
governmental office, any document or instrument supplemental to or confirmatory
of the Security Documents or otherwise reasonably deemed by the Administrative
Agent necessary or desirable for the continued validity, perfection and priority
of the Liens on the Collateral covered thereby.
6.12 Pledge of After Acquired Property; Additional Subsidiaries. nal
Subsidiaries
(a) If at any time following the Closing Date, any Borrower shall
acquire property of any nature whatsoever having a value in excess of One
Hundred Thousand and 00/100 Dollars ($100,000.00) which is intended by the terms
of the applicable Security Document to be, but is not, subject to the Liens
created by the Security Documents, such Borrower shall, as soon as possible and
in no event later than thirty (30) days after the relevant acquisition date and,
to the extent permitted by applicable law, grant to the Administrative Agent for
the ratable benefit of the Banks a first priority (subject to Liens permitted
under subsection 7.2) Lien (to the extent that such Borrower is then permitted
to grant such a Lien) on such property as collateral security for the
Liabilities pursuant to documentation reasonably satisfactory in form and
substance to the Administrative Agent. The Borrowers, at their own expense,
shall execute, acknowledge and deliver, or cause the execution, acknowledgement
and delivery of, and thereafter register, file or record in an appropriate
governmental office, any document or instrument (including legal opinions, title
insurance, consents and corporate documents) and take all such actions
reasonably deemed by the Administrative Agent to be necessary or desirable to
ensure the creation, priority and perfection of such Lien.
(b) The Borrowers shall, at the expense of the Borrowers, cause each
new Subsidiary created or acquired after the Closing Date, to execute and
deliver to the Administrative Agent, within ninety (90) days after the creation
or acquisition of such new Subsidiary, the following agreements and documents,
all in form and substance reasonably satisfactory to the Administrative Agent:
(i) a certain joinder and assumption agreement by and between
each such new Subsidiary, the Banks, the Administrative Agent and the
Documentation Agent, pursuant to which, among other things, each such
new Subsidiary shall (A) join in this Agreement and all of the Notes
and assume all of the Liabilities hereunder and thereunder, all as
fully and completely as though each such new Subsidiary was an original
Borrower hereunder; (B) make, to the Banks, the Administrative Agent
and the Documentation Agent, all of the representations, warranties and
covenants described in this Agreement and the Notes which have made
hereunder and thereunder by the Borrowers; and (C) agree to be bound by
and to observe all of the terms and conditions of this Agreement and
the Notes, jointly and severally with all of the Borrowers;
(ii) a certain security agreement, pursuant to which, among
other things, such new Subsidiary shall grant to the Administrative
Agent, for the ratable benefit of the Banks, a security interest in all
of its assets, together with any and all UCC financing statements which
the Administrative Agent deems necessary and appropriate in order to
perfect its security interests in such assets;
(iii) a certain assignment of receivables and proceeds,
pursuant to which, among other things, such new Subsidiary shall assign
to the Administrative Agent, for the ratable benefit of the Banks as
additional collateral all of its rights, title and interests in Net
Contract Proceeds; and
(iv) such other agreements, documents, financing statements,
instruments, opinions and certificates and completion of such other
matters, as the Administrative Agent may reasonably deem necessary or
appropriate.
Each Borrower which holds an equity interest in such new Subsidiary
shall promptly execute and deliver, a pledge agreement, providing for the pledge
of One Hundred Percent (100%) of such equity interest to the Administrative
Agent for the ratable benefit of the Banks.
7. CERTAIN NEGATIVE COVENANTS.
The Borrowers jointly and severally covenant and agree, so long as the
Commitments remain in effect or any amount is owing to any Bank, the
Administrative Agent or the Documentation Agent hereunder or under any other
Loan Document or any Letter of Credit remains outstanding, that:
7.1 Financial Covenants. Unless the Required Banks shall otherwise
agree in writing, the Borrowers shall not:
(a) Ratio of Consolidated Debt to Adjusted Consolidated EBITDA. Permit
for any period of four consecutive fiscal quarters (to be tested as of the last
day of each fiscal quarter, commencing with the fiscal quarter ending September
24, 1997) the ratio of their Consolidated Debt for such period to their Adjusted
Consolidated EBITDA for such period to be more than 2.75 to 1.00.
(b) Ratio of Consolidated EBITDA of the Borrowers to Consolidated Cash
Interest Expense of the Borrowers. Permit for any period of four consecutive
fiscal quarters (to be tested as of the last day of each fiscal quarter,
commencing with the fiscal quarter ending September 24, 1997) the ratio of the
Consolidated EBITDA of the Borrowers for such period to the Consolidated Cash
Interest Expense of the Borrowers for such period to be less than 4.00 to 1.00.
(c) Minimum Consolidated EBITDA of the Borrowers. Permit the
Consolidated EBITDA of the Borrowers at the end of any fiscal quarter,
commencing with the fiscal quarter ending September 24, 1997, to be less than
Three Million Five Hundred Thousand and 00/100 Dollars ($3,500,000.00).
(d) Maintenance of Net Worth. Permit Consolidated Net Worth at the end
of any fiscal quarter ending after March 26, 1997 to be less than the sum of (i)
One Hundred Seven Million and 00/100 Dollars ($107,000,000.00), plus (ii) all
Net Proceeds received by any Borrower upon the issuance, after the Closing Date,
of any additional Capital Stock of such Borrower, plus (iii) Seventy-Five
Percent (75%) of the aggregate Consolidated Net Income for each fiscal quarter
ending after the Closing Date.
7.2 Encumbrances. Each Borrower shall not create, incur, assume or
suffer to exist, any Lien or other encumbrance of any nature whatsoever on any
of its assets, including without limitation the Collateral, other than: (a)
Liens securing the payment of taxes, either not yet due or the validity of which
is being contested in good faith by appropriate proceedings, and as to which the
applicable Borrower shall, if appropriate under GAAP, have set aside on its
books and records adequate reserves; provided that such contest does not have a
Material Adverse Effect; (b) deposits under worker's compensation, unemployment
insurance, social security and other similar Laws, or to secure the performance
of bids, tenders or contracts (other than for the repayment of borrowed money)
or to secure indemnity, performance or other similar bonds for the performance
of bids, tenders or contracts (other than for the repayment of borrowed money)
or to secure statutory obligations or surety or appeal bonds, or to secure
indemnity, performance or other similar bonds in the ordinary course of
business, and Liens securing judgments that have not resulted in an Event of
Default under clause (d) of subsection 8.1 hereof; (c) statutory Liens of
landlords, carriers, warehousemen, mechanics, materialmen or suppliers incurred
in the ordinary course of business for sums not yet delinquent; (d) Liens in
favor of the Administrative Agent and the Banks; (e) purchase money security
interests arising in connection with Equipment or real estate purchases or lease
financings made as permitted by this Agreement, not to exceed an aggregate of
Five Million and 00/100 Dollars ($5,000,000.00) outstanding at any time; (f)
Liens described on Schedule 7.2; and (g) Liens other than those permitted in
subsections 7.2(a) through (f), inclusive, securing obligations in an aggregate
outstanding amount of no more than Two Hundred Fifty Thousand and 00/100 Dollars
($250,000.00).
7.3 Indebtedness. Each Borrower shall not incur, create, assume,
become or be liable in any manner with respect to, or permit to exist, any
Indebtedness, except: (a) the Liabilities; (b) trade obligations and normal
accruals in the ordinary course of business not yet due and payable, or with
respect to which the applicable Borrower is contesting in good faith the amount
or validity thereof by appropriate proceedings, and then only to the extent that
the applicable Borrower has set aside on its books adequate reserves therefor,
in accordance with GAAP; (c) purchase money Indebtedness incurred to finance the
purchase or lease of Equipment or real estate, not to exceed an aggregate of
Five Million and 00/100 Dollars ($5,000,000.00) outstanding at any time, (d)
Indebtedness of any Borrower to any other Borrower; (e) unsecured guaranties
made by any Borrower in connection with a New Project or Permitted Acquisition;
provided, however, that the total amount of such guaranties shall not exceed
Five Million and 00/100 Dollars ($5,000,000.00) in the aggregate at any time
outstanding; (f) Indebtedness of any Borrower in respect of performance, bid or
similar bonds related to Facility Agreements, in a principal amount not to
exceed Twenty Million and 00/100 Dollars ($20,000,000.00) in the aggregate at
any time; (g) Subordinated Debt; (h) other Indebtedness incurred after the
Closing Date in an aggregate principal amount outstanding at any time not to
exceed Two Million and 00/100 Dollars ($2,000,000.00); and (i) Indebtedness
existing on the Closing Date and reflected on Schedule 7.3.
7.4 Mergers and Consolidations. Except as allowed under subsection
7.5, each Borrower shall not enter into any transaction of merger or
consolidation, or liquidate, wind up or dissolve (or suffer any liquidation or
dissolution), or convey, sell, lease, transfer or otherwise dispose of, in one
transaction or a series of transactions, all or substantially all of its
business, property or tangible or intangible assets, whether now owned or
hereafter acquired, except that any Borrower may merge or consolidate with, or
convey, sell, lease, transfer or dispose of assets to, any other Borrower and
thereafter dissolve (provided that in the case of a merger or consolidation
involving Fine Host, Fine Host is the surviving corporation); and except that
any Borrower may merge or consolidate with any other Person with which Fine Host
is permitted to merge or consolidate (provided that such Borrower is the
surviving corporation).
7.5 Acquisitions. Each Borrower shall not acquire any stock of any
corporation or ownership interest in any other entity, or acquire all or
substantially all of the assets of, or such of the assets as would permit the
transferee to continue any one or more integral business operations of, any
Person. Notwithstanding the preceding sentence to the contrary,
(a) any Borrower may acquire Capital Stock or other ownership
interests of any entity which, as a result of such acquisition, becomes
a Subsidiary; provided, however, that all of the Borrowers and such
entity comply with all of the applicable provisions contained herein
(including, without limitation, the provisions of subsection 6.12(b));
(b) any Borrower may acquire assets of any entity which
assets, as a result of such acquisition, are owned by a Subsidiary;
provided, however, that all of the Borrowers and such entity comply
with all of the applicable provisions contained herein (including,
without limitation, the provisions of subsections 4.3 and 6.12(b), to
the extent applicable); and
(c) any Borrower may acquire Capital Stock or other ownership
interests of any entity that does not thereby become a Subsidiary if
such acquisition complies with subsection 7.7(e); and
further, provided, however, that notwithstanding anything contained in this
sentence to the contrary, after the Closing Date, no Borrower shall incur or
assume, without the prior written consent of the Required Banks, Project Costs
of more than Ten Million and 00/100 Dollars ($10,000,000.00) for any New Project
or Thirty Million and 00/100 Dollars ($30,000,000.00) for any Permitted
Acquisition.
7.6 Disposal of Property. Each Borrower shall not sell, lease, transfer or
otherwise dispose of any of its properties, assets and rights to any Person
(other than to any other Borrower) except: (a) sales of Inventory in the
ordinary course of business; (b) sales of property being replaced in the
ordinary course of business by other property with a fair market value equal to
or greater than the property being so replaced; (c) sales or disposal of
Equipment having a value of less than One Hundred Seventy-Five Thousand and
00/100 Dollars ($175,000.00) per fiscal year of the Borrowers; (d) subject to
subsection 3.1(b), sales or transfers pursuant to the termination of a Facility
Agreement which will not result in any extraordinary gains or losses pursuant to
GAAP (including the prepayment of any Note Receivable or receipt of any Net
Contract Proceeds, subject to the terms of an Assignment of Receivables and
Proceeds executed and delivered to the Administrative Agent); or (e) other sales
or disposal of Equipment having a net book value as of such sale or disposition
aggregating not more than Two Million Five Hundred Thousand and 00/100
($2,500,000.00) since the Closing Date. If any of the Equipment is sold,
transferred or otherwise disposed of as herein provided, and such sale, transfer
or disposition is made in connection with the purchase by any Borrower of
replacement Equipment, such Borrower shall use the proceeds of such sale,
transfer or disposition solely to finance the purchase by such Borrower of such
replacement Equipment and shall deliver to the Administrative Agent written
evidence of the use of the proceeds for such purchase. All replacement Equipment
purchased by any Borrower shall be free and clear of all Liens, except for those
of the Administrative Agent and except for purchase money security interests
arising out of such purchases to the extent permitted under subsection 7.2.
7.7 Investments or Loans. Each Borrower shall not make, incur, assume or
suffer to exist any Investment in any other Person, except: (a) Investments
existing on the Closing Date and identified in Schedule 7.7 ("Ongoing
Investments"); (b) Cash Equivalents; (c) without duplication, (i) Investments
permitted as Indebtedness pursuant to subsection 7.3, (ii) acquisitions pursuant
to subsection 7.5, (iii) guaranties pursuant to subsection 7.8, (iv) Capital
Expenditures pursuant to subsection 7.9 and (v) Project Costs pursuant to
subsection 7.10; (d) in the ordinary course of business, Investments by any
Borrower in any other Borrower, by way of contributions to capital or loans or
advances and (e) other Investments not to exceed Five Hundred Thousand and
00/100 Dollars ($500,000.00) at any time outstanding; provided however, that no
Investment otherwise permitted by this subsection 7.7 shall be permitted to be
made if, immediately before or after giving effect thereto, any Default or Event
of Default shall have occurred and be continuing.
7.8 Guaranties. None of the Borrowers shall guarantee, endorse or otherwise
in any way become or be responsible for obligations of any other Person
(including without limitation any officer, director, employee or stockholder of
any Borrower (but excluding the Borrowers)), whether by agreement to purchase
the Indebtedness of any other Person or through the purchase of goods, supplies
or services, or maintenance of working capital or other balance sheet covenants
or conditions, or by way of stock purchase, capital contribution, advance or
loan for the purpose of paying or discharging any Indebtedness or obligation of
such other Person or otherwise, except (a) endorsements of negotiable
instruments for deposit or collection in the ordinary course of business, (b)
guaranties permitted under subsection 7.3(e), (c) performance bonds given in
connection with the entry by any Borrower into a Facility Agreement, bonds
necessary to submit bids for a Facility Agreement, or similar bonds or
agreements, and (d) guaranties or bonds by any Borrower required by any Person
other than Fine Host or any Affiliate in connection with obtaining or
maintaining a License necessary for a Facility Agreement. All guaranties, bonds
and agreements encompassed under clauses (b), (c) and (d) of the preceding
sentence as of the date hereof are listed on Schedule 7.8. Nothing in this
subsection 7.8 is intended to limit the exceptions to Indebtedness, Investments
or Loans which are permitted under subsections 7.3 and 7.7.
7.9 Capital Expenditure Limitations. Each Borrower will not make, or commit
to make, Capital Expenditures in any fiscal year of the Borrowers; provided,
however, that the Borrowers may make (i) Capital Expenditures which do not
constitute Project Costs in an aggregate amount of not more than Two Million and
00/100 Dollars ($2,000,000.00) in each fiscal year of the Borrowers, and (ii)
without duplication, Capital Expenditures as permitted under subsections 7.5,
7.7 and 7.10.
7.10 Limitations on Project Costs. The Borrowers shall not incur or assume,
after the Closing Date, Project Costs for all New Projects and all Permitted
Acquisitions, in excess of, in the aggregate, the following amounts:
================================================================= ==============
Maximum Amount
Applicable Period
================================================================= ==============
After the Closing Date to and including the $60,000,000
first anniversary of the Closing Date
================================================================= ==============
After the first anniversary of the Closing $65,000,000
Date to and including the second anniversary of the Closing Date
================================================================= ==============
After the second anniversary of the Closing Date to and including $75,000,000
the third anniversary of the Closing Date
- ----------------------------------------------------------------- ==============
After the third anniversary of the Closing Date $0
- ----------------------------------------------------------------- ==============
provided, however, that: (A) acquisitions, Investments and Capital Expenditures
made pursuant to subsections 7.5, 7.7(c)(ii), 7.7(c)(iv)-(v) and 7.9 (other than
clause (i) of subsection 7.9) shall reduce, dollar-for-dollar (but without
duplication), any Investments permitted to be made pursuant to this subsection
7.10; and (B) the amount of Capital Expenditures and Project Costs permitted to
be made as provided above in this subsection 7.10 shall not be reduced by the
amount of any Net Contract Proceeds which the Borrower Agent has notified the
Administrative Agent in writing prior to the application thereof, are being
applied pursuant to this subsection 7.10.
7.11 Distributions. No Borrower shall pay any dividends (other than
stock dividends, provided that stock dividends paid with respect to any of its
Capital Stock which is subject to Pledge Agreements to the Administrative Agent
shall be subject to the terms of such Pledge Agreement) or distributions, either
in cash or in kind, on any class of its Capital Stock, nor make any distribution
on account of its Capital Stock, nor redeem, purchase or otherwise acquire,
directly or indirectly, any of its Capital Stock; provided, however, that Fine
Host shall be permitted, at any time, to (a) pay cash dividends in respect of
any of its shares of Capital Stock or (b) redeem, purchase or otherwise acquire,
during each fiscal year of Fine Host, up to an aggregate amount of Two Hundred
Fifty Thousand and 00/100 Dollars ($250,000.00) of its shares of Capital Stock,
if after giving effect to either of such transactions, it remains in compliance
with the financial covenants set forth in subsections 7.1 and 7.7, and,
provided, further, however, that any Borrower shall be permitted to make
distributions or pay dividends to its immediate parent.
7.12 Compensation. No Borrower shall pay compensation, directly or
indirectly, whether in cash or in property (including fringe benefits, and
whether in respect of stock ownership, consulting or other services or for any
other reason whatsoever), to any Affiliate of any Borrower except as set forth
in Schedule 7.12 or as disclosed in any registration statement or report
(including, without limitation, reports on Form 10-K, Form 10-Q and Form 8-K)
filed by Fine Host with the SEC, as amended, modified or supplemented, from time
to time and except that the provisions of this subsection 7.12 shall not apply
to reasonable payments or employee benefits made to employees or officers of any
Borrower, as determined in good faith by the Board of Directors of such Borrower
or, in the case of directors, to reasonable and customary directors'
compensation, in each case in the ordinary course of business.
7.13 Transactions with Affiliates. Other than as set forth on Schedule
7.13, and except as disclosed in any registration statement or report
(including, without limitation, reports on Form 10-K, Form 10-Q and Form 8-K)
filed by Fine Host with the SEC, as amended, modified or supplemented, from time
to time, no Borrower shall loan, contribute or otherwise transfer any cash or
property to any Affiliate of any Borrower or enter into any transaction,
including without limitation the purchase, sale or exchange of property or the
rendering of any service to any Affiliate of any Borrower, except that
transactions with Affiliates of any Borrower which are at arm's length, are for
fair value and are in the ordinary course of such Borrower's and such
Affiliate's business shall be permitted.
7.14 Prepayment of Other Liabilities. Each of the Borrowers shall not
directly or indirectly prepay, purchase, redeem, retire or otherwise acquire, or
make any optional payment on account of any principal of or any interest on or
premium payable in connection with the optional repayment, redemption or
retirement of, any of its Indebtedness (including but not limited to
Subordinated Debt) except for (i) the Liabilities; (ii) any obligations related
to a Facility Agreement which results in the prepayment in full of the
corresponding and related Guidance Loan; and (iii) mandatory prepayments and
other scheduled payments required under any Indebtedness that is permitted under
this Agreement.
7.15 Amendment of Charter. No Borrower shall amend its charter or
by-laws, change its fiscal year-end, or adopt or alter any preferred stock terms
or preferences if such amendment, adoption, or alteration would (i) adversely
affect the ability of the Borrowers, taken as a whole, to repay the Liabilities;
or (ii) result in a Material Adverse Change.
7.16 ERISA Termination Event. No Borrower shall permit any ERISA
Termination Event to occur, or suffer any ERISA Termination Event to exist, if,
in either case, such ERISA Termination Event could have a Material Adverse
Effect.
8. DEFAULT, RIGHTS AND REMEDIES OF THE ADMINISTRATIVETHE ADMINISTRATIVE
AGENT.
8.1 "Event of Default" shall mean the occurrence or existence of any one or
more of the following events:
(a) any Borrower fails to pay any of the Liabilities when such
Liabilities are due or are declared due, whether at stated maturity, by
acceleration or otherwise, within five (5) days of the date due;
(b) any Borrower fails or neglects to perform, keep or observe any of
the covenants, conditions, promises or agreements contained in this Agreement or
in any of the other Loan Documents within ten (10) days after the date of notice
by the Administrative Agent of the failure to perform, keep, or observe such
covenant, condition, promise, or agreement (provided that there shall be no such
ten (10) day grace period for failure to comply with any of the covenants
contained in Section 7 hereof, or if any of the Loan Documents are unenforceable
in whole or in part in accordance with their terms);
(c) any warranty or representation now or hereafter made by any
Borrower pursuant to this Agreement or any of the other Loan Documents is
untrue, incorrect or incomplete in any material respect, or any schedule,
certificate, statement, report, financial data, notice, or writing furnished at
any time by any Borrower to any Bank pursuant to or in connection with the Loans
is untrue, incorrect or incomplete in any material respect, on the date as of
which the facts set forth therein are stated or certified or restated or
recertified;
(d) judgments or orders requiring aggregate payments in excess of One
Million and 00/100 Dollars ($1,000,000.00) shall be rendered against any
Borrower, and such judgments or orders shall remain unsatisfied or undischarged
and in effect for sixty (60) consecutive days without a stay of enforcement or
execution, provided that this clause (d) shall not apply to the extent that any
judgment for which the applicable Borrower is insured in full (less customary
deductibles);
(e) a notice of Lien, levy or assessment is filed or recorded with
respect to all or a material part of the Collateral by the United States, or any
department, agency or instrumentality thereof, or by any state, county,
municipality or other governmental agency, or any taxes or debts owing at any
time or times hereafter to any one or more of them become a Lien, upon all or a
material part of the Collateral, provided that this clause (e) shall not apply
to any Liens, levies, or assessments which are being contested in good faith
(provided the Borrowers have complied with the provisions of clauses (a) and (b)
of subsection 6.4);
(f) all or any material part of the Collateral is attached, seized,
subjected to a writ or distress warrant, or is levied upon, or comes within the
possession of any judgment creditor, receiver, trustee, custodian or assignee
for the benefit of creditors;
(g) a proceeding under any Insolvency Law is filed against any Borrower
and such proceeding is not dismissed within sixty (60) days of the date of its
filing, or a proceeding under any Insolvency Law is filed by any Borrower, or
any Borrower files an answer admitting the material allegations of a petition
filed against it, or any Borrower makes an assignment for the benefit of
creditors, or any Borrower takes any corporate or other action to authorize any
of the foregoing;
(h) any Borrower voluntarily or involuntarily dissolves or is dissolved
except as permitted by subsection 7.4, or terminates or is terminated;
(i) any Borrower becomes Insolvent, or admits in writing its inability,
or fails generally, to pay its debts as they become due;
(j) any Borrower is enjoined, restrained, or in any way prevented from
conducting all or any material part of its business affairs;
(k) a material default by any Borrower shall occur (and any applicable
cure period shall have expired) under any Facility Agreement or related
agreement, document or instrument, whether heretofore, now or hereafter existing
between any Borrower or any other Person unless, within five (5) Business Days
of such default, the Borrower Agent provides to the Administrative Agent a
certificate (together with any other documents reasonably required by the
Administrative Agent) from the Chief Executive Officer, Chief Financial Officer
or Treasurer of the Borrower Agent that the Borrowers, taken as a whole,
notwithstanding termination of such Facility Agreement or related agreement,
document, or instrument, shall continue to meet, and shall in the foreseeable
future continue to meet, the financial covenants in subsection 7.1;
(l) any Borrower shall default in making any payment when due, whether
at stated maturity, by acceleration or otherwise, on any obligation for borrowed
money in an aggregate amount in excess of Seven Hundred Fifty Thousand and
00/100 Dollars ($750,000.00) or the holder of any such obligation shall become
entitled to cause such obligation to become due prior to its stated date of
maturity;
(m) there shall be a Change in Control of Fine Host;
(n) there shall occur a Material Adverse Change affecting the
Borrowers, which could reasonably be expected to have a Material Adverse Effect
on the value of the Collateral, or the Administrative Agent's Lien thereon, or
the ability of the Borrowers to repay the Liabilities;
(o) any Borrower shall be convicted of any crime for which forfeiture
of a material amount of its property, or payment of a material penalty, will be
required, or for which a license may be revoked, terminated, or suspended, and
such revocation, termination, or suspension would result in a Material Adverse
Effect; or
(p) any Security Document shall at any time after its execution and
delivery and for any reason cease: (A) to create a valid and perfected first
priority security interest in and to a material portion of the Collateral
covered by such Security Agreement; or (B) to be in full force and effect or
shall be declared null and void.
8.2 Termination of Obligation to Make Loans and Acceleration. Upon the
occurrence of an Event of Default referred to in subsection 8.1(g), all of the
Liabilities shall automatically, without notice of any kind, be immediately due
and payable and the Banks shall have no further obligation to make Loans
hereunder. Upon the occurrence of any other Event of Default, the Banks shall
have no further obligation to make Loans hereunder and any or all of the
Liabilities may, at the option of the Administrative Agent, acting in accordance
with the provisions of subsections 9.2 and 10.1, and without presentment,
demand, protest or notice of any kind, be declared, and thereupon shall become,
immediately due and payable, provided that the Administrative Agent shall give
notice of such acceleration to the Borrowers.
8.3 Rights and Remedies Generally. Upon the occurrence of an Event of
Default, the Administrative Agent shall have, in addition to any other rights
and remedies contained in this Agreement or in any of the other Loan Documents,
all of the rights and remedies of a secured party under the UCC or other
applicable Laws, all of which rights and remedies shall be cumulative and
non-exclusive, to the extent permitted by Law. The Administrative Agent shall
further have as a matter of right and without notice to any Borrower, unless
otherwise required by applicable law, and without regard to the adequacy or
inadequacy of any Collateral as security for the Liabilities or the interest of
any Borrower therein, the right to apply to any court of competent jurisdiction
to appoint a receiver or receivers of any Borrower of all or any portion of the
property of any Borrower comprising the Collateral and to have such receiver or
receivers appointed, and each of the Borrowers hereby irrevocably consents to
such appointment and waives notice of any application therefor (except as may be
required by Law). Any such receiver or receivers shall have all the usual powers
and duties of receivers in like or similar cases and all the powers and duties
of the Administrative Agent provided in this Agreement and the other Loan
Documents including, without limitation and to the extent permitted by Law, and
by such documents, the right to operate under existing licenses, franchises and
permits granted or issued to any Borrower and the right to enter into licenses,
sublicenses, leases and subleases of all or any part of the Collateral to the
extent that any Borrower possessed such rights, and shall continue as such and
exercise all such powers until the date of confirmation of sale of the
Collateral unless such receivership is sooner terminated.
8.4 Entry Upon Premises and Access to Information. Upon the occurrence
and during the continuance of an Event of Default, the Administrative Agent
shall have the right, to the extent permitted by Law, to enter upon the premises
of each of the Borrowers where the Collateral is located (or is believed to be
located) without any obligation to pay rent to any Borrower, or, except to the
extent that the rights of third parties would be violated, until an appropriate
order from a competent court is issued, any other place or places where the
Collateral is believed to be located and kept, and remove the Collateral
therefrom to the premises of the Administrative Agent, for such time as the
Administrative Agent may desire, in order effectively to collect or liquidate
the Collateral, or the Administrative Agent may require any Borrower to assemble
the Collateral and make it available to the Administrative Agent at a place or
places to be designated by the Administrative Agent. Upon the occurrence and
during the continuance of an Event of Default, the Administrative Agent shall
have the right to obtain access to the data processing equipment, computer
hardware and software of any Borrower relating to the Collateral and to use all
of the foregoing and the information contained therein in any manner the
Administrative Agent deems appropriate for the purposes of protecting the rights
of the Administrative Agent hereunder and its rights to the Collateral; and the
Administrative Agent shall have the right to notify post office authorities to
change the address for delivery of the mail of the Borrowers to an address
designated by the Administrative Agent and to receive, open and process all mail
addressed to any of the Borrowers.
8.5 Sale or Other Disposition of Collateral by the Administrative
Agent. The net proceeds realized by the Administrative Agent upon any such sale
or other disposition, after deduction for the expense of retaking, holding,
preparing for sale, selling or the like and the reasonable attorneys' and
paralegals' fees and legal expenses incurred by the Administrative Agent in
connection therewith, shall be applied as provided herein toward satisfaction of
the Liabilities. The Administrative Agent shall account to each of the Borrowers
for any surplus realized upon such sale or other disposition, and each of the
Borrowers shall remain liable for any deficiency. The commencement of any
action, legal or equitable, or the rendering of any judgment or decree for any
deficiency, shall not affect the Administrative Agent's security interest in the
Collateral until the Liabilities are fully paid. Each of the Borrowers agrees
that the Administrative Agent has no obligation to preserve rights to the
Collateral against any other parties.
8.6 Waiver of Demand. Demand, presentment, protest and notice of
nonpayment are hereby waived by each of the Borrowers. To the extent permitted
by Law, each of the Borrowers also waives the benefit of all valuation,
appraisal and exemption laws.
8.7 Waiver of Notice. UPON THE OCCURRENCE AND CONTINUANCE OF A DEFAULT,
EACH OF THE BORROWERS HEREBY WAIVES ALL RIGHTS TO NOTICE AND HEARING OF ANY KIND
PRIOR TO THE EXERCISE BY THE ADMINISTRATIVE AGENT OR THE BANKS OF ITS OR THEIR
RIGHTS TO REPOSSESS THE COLLATERAL WITHOUT JUDICIAL PROCESS OR TO REPLEVY,
ATTACH OR LEVY UPON THE COLLATERAL WITHOUT PRIOR NOTICE OR HEARING, TO THE
EXTENT PERMITTED IN THE JURISDICTION IN WHICH SUCH COLLATERAL IS LOCATED.
8.8 Advice of Counsel. Each of the Borrowers hereby acknowledges that
each of them has received advice from its counsel with respect to this
transaction and this Agreement, including without limitation any waivers
contained herein.
9. THE ADMINISTRATIVE AGENTSTRATIVE AGENT
9.1 Appointment. Each Bank hereby irrevocably designates and appoints
the Administrative Agent as the agent of such Bank under this Agreement and the
other Loan Documents, and each such Bank irrevocably authorizes the
Administrative Agent, in such capacity, to take such action on its behalf under
the provisions of this Agreement and the other Loan Documents and to exercise
such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Bank, and no
implied covenants, functions, responsibilities, duties, obligation or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.
9.2 Delegation of Duties. The Administrative Agent may execute any of
its duties under this Agreement and the other Loan Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.
9.3 Exculpatory Provisions. Neither the Administrative 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 under or in connection with this Agreement or any other Loan
Document (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 any Borrower or any
officer or agent thereof contained in this Agreement or any other Loan Document
or in any certificate, report, statement or other document referred to or
provided for in, or received by the Administrative Agent under or in connection
with, this Agreement or any other Loan Document or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document or for any failure of any Borrower to perform its
obligations hereunder or thereunder. The Administrative 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 agreements contained in, or conditions of, this
Agreement or any other Loan Document, or to inspect the properties, books or
records of the Borrowers.
9.4 Reliance by Administrative Agent. The Administrative Agent shall be
entitled to rely, and shall be fully protected in relying, upon any Note,
writing, resolution, notice, consent, certificate, affidavit, letter, telecopy,
telex or teletype message, statement, order or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrowers), independent
accountants and other experts selected by the Administrative Agent. Subject to
the provisions of subsection 10.15, the Administrative Agent may deem and treat
the payee of any Note as the owner thereof for all purposes. The Administrative
Agent shall be fully justified in failing or refusing to take any action under
this Agreement or any other Loan 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 Administrative Agent shall in all cases
be fully protected in acting, or in refraining from acting, under this Agreement
and the other Loan Documents in accordance with a request of the Required Banks
(except as otherwise provided in subsection 10.1) and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Banks and all future holders of the Loans.
9.5 Notice of Default. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
hereunder (other than the non-payment of principal or interest on the Loans to
the extent that the same is required to be paid to the Administrative Agent for
the account of the Banks) unless the Administrative Agent has received notice
from a Bank or the Borrowers 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 Administrative Agent receives such a notice, the
Administrative Agent shall give notice thereof to the Banks. The Administrative
Agent shall take such action with respect to such Default or Event of Default as
shall be reasonably directed by the Required Banks; provided, however, that
unless and until the Administrative Agent shall have received such directions,
the Administrative Agent may (but shall not be obligated to) take such action,
or refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Banks.
9.6 Non-Reliance on Adminstrative Agent. Each Bank expressly
acknowledges that neither the Administrative Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates has made any
representations or warranties to it and that no act by the Administrative Agent
hereinafter taken, including any review of the affairs of the Borrowers, shall
be deemed to constitute any representation or warranty by the Administrative
Agent to any Bank. Each Bank represents to the Administrative Agent that it has,
independently and without reliance upon the Administrative Agent or any other
Bank, and based on such documents and information as it has deemed appropriate,
made its own appraisal or investigation into the business, operations, property,
financial and other condition and creditworthiness of the Borrowers and made its
own decision to make its Loans hereunder and enter into this Agreement. Each
Bank also represents that it will, independently and without reliance upon the
Administrative Agent or any other Bank, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and will make such investigation as
it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Borrowers. Except for
notices, reports and other documents expressly required to be furnished to the
Banks by the Administrative Agent hereunder, the Administrative Agent shall not
have any duty or responsibility to provide any Bank with any credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of the Borrowers which may come
into the possession of the Administrative Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates.
9.7 Indemnification. The Banks agree to indemnify the Administrative
Agent in its capacity as such (to the extent not reimbursed by the Borrowers and
without limiting the obligation of the Borrowers to do so), ratably according to
their respective Commitment Percentages in effect on the date on which
indemnification is sought (or, if indemnification is sought after the date upon
which the Commitments shall have terminated and the Loans shall have been paid
in full, ratably in accordance with their Commitment Percentages immediately
prior to such date), from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind whatsoever which may at any time (including, without
limitation at any time following the payment of the Loans) be imposed on,
incurred by or asserted against the Administrative Agent in any way relating to
or arising out of, the Commitments, this Agreement, any of the other Loan
Documents or any documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby or any action taken or omitted
by the Administrative Agent under or in connection with any of the foregoing;
provided, however, that no Bank shall be liable for the payment of any portion
of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent's gross negligence or willful misconduct. The agreements in
this subsection shall survive the payment of the Loans and all other amounts
payable hereunder.
9.8 Administrative Agent in Its Individual Capacity. The Administrative
Agent and its Affiliates may make loans to, accept deposits from and generally
engage in any kind of business with the Borrowers as though the Administrative
Agent were not the Administrative Agent hereunder and under the other Loan
Documents. With respect to the Loans made by it and with respect to any Letter
of Credit issued or participated in by it, the Administrative Agent shall have
the same rights and powers under this Agreement and the other Loan Documents as
any Bank and may exercise the same as though it were not the Administrative
Agent, and the terms "Bank" and "Banks" shall include the Administrative Agent
in its individual capacity.
9.9 Successor Administrative Agent. The Administrative Agent may resign
as Administrative Agent upon ten (10) days' notice to the Banks and the Borrower
Agent. If the Administrative Agent shall resign as Administrative Agent under
this Agreement and the other Loan Documents, then the Required Banks shall
appoint from among the Banks a successor agent for the Banks, which successor
agent shall be subject to the approval of the Borrower Agent (which approval
shall not be unreasonably withheld), whereupon such successor agent shall
succeed to the rights, powers and duties of the Administrative Agent, and the
term "Administrative Agent" shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent's rights, powers
and duties as Administrative Agent shall be terminated, without any other
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement or any holders of the Loans. After any retiring
Administrative Agent's resignation as Administrative Agent, the provisions of
this Section 9 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Administrative Agent under this Agreement and the
other Loan Documents.
In the event that the Administrative Agent or its assets are taken over
by any state or federal agency having jurisdiction over the Administrative Agent
or its assets, the Required Banks may appoint another Bank as successor to the
Administrative Agent, which successor agent shall be subject to the approval of
the Borrower Agent (which approval shall not be unreasonably witheld).
9.10 Removal of Administrative Agent. The Required Banks may, upon ten
(10) days' notice to the Banks and the Borrower Agent, remove the Administrative
Agent and appoint another Bank as successor to the Administrative Agent, which
successor agent shall be subject to the approval of the Borrower Agent (which
approval shall not be unreasonably withheld).
9.11 Issuing Bank; Swing Line Bank. The provisions of this Section 9
(other than subsection 9.9) shall apply to the Issuing Bank and the Swing Line
Bank to the same extent as such provisions apply to the Administrative Agent.
10. MISCELLANEOUS
10.1 Amendments and Waivers. Neither this Agreement nor any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this subsection. The
Administrative Agent may, from time to time, with the prior written consent of
the Required Banks, (a) enter into with each Borrower which is a party to the
relevant Loan Documents written amendments, supplements or modifications hereto
and to the other Loan Documents for the purpose of adding any provisions to this
Agreement or the other Loan Documents or changing in any manner the rights of
the Banks or of the Borrowers hereunder or thereunder, (b) declare an
acceleration of the Loans upon the occurrence of an Event of Default, (c)
commence collateral enforcement or foreclosure proceedings, or (d) waive, on
such terms and conditions as the Required Banks or the Administrative Agent, as
the case may be, may specify in such instrument, any of the requirements of this
Agreement or the other Loan Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver or consent and no such
amendment, supplement or modification shall, without the prior written consent
of all of the Banks and the Administrative Agent, (i) reduce the amount or
extend the scheduled date of maturity of any Loan made by any Bank or of any
installment thereof, or reduce the stated rate of any interest thereon or reduce
the fee payable hereunder to any Bank or extend the scheduled date of any
payment thereof or increase the aggregate amount or extend the expiration date
of any Bank's Commitments, in each case without the consent of such Bank
directly affected thereby, (ii) amend, modify or waive any provision of this
subsection or reduce the percentage specified in the definition of Required
Banks or consent to the assignment or transfer by the Borrowers of any of their
rights and obligations under this Agreement and the other Loan Documents, (iii)
release any Collateral (except that (x) no consent of any Bank is required to
permit the release of a Lien in connection with the sale of any Collateral at
the levels permitted under subsection 7.6 of this Agreement or any other
transaction permitted under such subsection, and (y) consents of all of the
Banks shall not be required in respect of a release of any or all of the
property or assets subject to the Kentucky Mortgage or the Kentucky Conditional
Assignment of Rentals if the Required Banks shall have approved the sale or
transfer of such property or assets or shall have consented to an amendment to
subsection 7.6 of this Agreement that permits such sale or transfer), (iv)
amend, modify or waive any provision of Section 3 (other than subsection 3.14),
(v) release any Borrower, or (vi) amend, modify or waive any provision of
Section 9. Any such waiver and any such amendment, supplement or modification
shall apply equally to each of the Banks and shall be binding upon the
Borrowers, the Banks, the Administrative Agent and all future holders of the
Loans. In the case of any waiver, the Borrowers, the Banks and the
Administrative Agent shall be restored to their former positions and rights
hereunder and under the other Loan Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; no such waiver
shall extend to any subsequent or other Default or Event of Default or impair
any right consequent thereon.
10.2 Attorneys' Fees and Expenses. If at any time or times hereafter
the Administrative Agent employs counsel in connection with protecting or
perfecting the Administrative Agent's security interest in the Collateral or in
connection with any matters contemplated by or arising out of this Agreement,
whether (a) to commence, defend, or intervene in any litigation or to file a
petition, complaint, answer, motion or other pleadings, (b) to take any other
action in or with respect to any suit or proceeding (Insolvency or otherwise),
(c) to consult with officers of the Administrative Agent to advise the
Administrative Agent, (d) to protect, collect, lease, sell, take possession of,
or liquidate any of the Collateral, or (e) to attempt to enforce or to enforce
any Lien on any of the Collateral or to attempt to enforce or to enforce any
rights of the Administrative Agent to collect any of the Liabilities, then in
any of such events, all of the attorneys' and paralegals' reasonable fees
arising from such services, and any reasonable expenses, costs and charges
relating thereto, together with interest at the rate prescribed herein for the
Guidance Loans, shall be part of the Liabilities, payable on demand and secured
by the Collateral.
10.3 Expenditures by the Administrative Agent. Except as permitted
herein, in the event that any of the Borrowers fails to pay taxes, insurance,
assessments, costs or expenses which any Borrower is, under any of the terms of
this Agreement or of any of the other Loan Documents, required to pay, or fails
to keep the Collateral free from Liens, or fails to perform under any agreement
related to or for which a Letter of Credit has been issued or a Guidance Loan
has been made, the Administrative Agent may, in its sole and absolute
discretion, make expenditures for any or all of such purposes, and the amount so
expended, together with interest thereon at the rate prescribed herein for the
Guidance Loans, shall be part of the Liabilities, payable on demand and secured
by the Collateral.
10.4 Custody and Preservation of Collateral. The Administrative Agent
and each Bank shall be deemed to have exercised reasonable care in the custody
and preservation of any of the Collateral in its possession if it takes such
action for that purpose as the Administrative Agent or such Bank would with
respect to similar property held in such Bank's name.
10.5 Reliance by the Banks. Each of the Borrowers hereby acknowledges
that the Banks, in entering into this Agreement and agreeing, to the extent
provided herein, to make Loans and otherwise extend credit to the Borrowers
hereunder, have relied upon the accuracy of the covenants, agreements,
representations and warranties made herein by each of the Borrowers and the
information delivered by each of the Borrowers to the Banks in connection
herewith (including without limitation, the Initial Financial Statements).
10.6 Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts (including by
facsimile transmission), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. A set of the copies of this
Agreement signed by all the parties shall be lodged with the Borrower Agent and
the Administrative Agent.
10.7 Submission to Jurisdiction; Jury Trial Waiver; Waiver of Bond.
EACH OF THE BORROWERS HEREBY CONSENTS TO THE JURISDICTION OF ANY LOCAL, STATE OR
FEDERAL COURT LOCATED WITHIN SUFFOLK COUNTY, MASSACHUSETTS AND WAIVES ANY
OBJECTION WHICH ANY BORROWER MAY HAVE BASED ON IMPROPER VENUE OR FORUM NON
CONVENIENS TO THE CONDUCT OF ANY PROCEEDING IN ANY SUCH COURT AND EACH OF THE
BORROWERS CONSENTS THAT ALL SERVICE OF PROCESS UPON IT BE MADE BY REGISTERED
MAIL OR MESSENGER DIRECTED TO IT AT THE ADDRESS SET FORTH IN SUBSECTION 10.12
AND THAT SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED UPON THE EARLIER OF
ACTUAL RECEIPT OR THREE (3) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED TO SUCH
BORROWER'S ADDRESS. EACH OF THE BORROWERS AND THE BANKS HEREBY WAIVES, TO THE
EXTENT PERMITTED BY LAW, TRIAL BY JURY, IN ANY LEGAL PROCEEDINGS ARISING OUT OF
OR RELATING TO THIS AGREEMENT, ANY OF THE OTHER LOAN DOCUMENTS OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREIN OR THEREIN. EACH OF THE BORROWERS HEREBY WAIVES
ANY BOND OR SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER,
BE REQUIRED OF THE ADMINISTRATIVE AGENT, THE BANKS OR ANY OF THEM, AND LIKEWISE
WAIVES, TO THE EXTENT PERMITTED BY LAW, ANY BOND OR SURETY WHICH MIGHT BE
REQUIRED OF THE ADMINISTRATIVE AGENT, THE BANKS OR ANY OF THEM IN ANY LEGAL
PROCEEDING. NOTHING CONTAINED IN THIS SUBSECTION 10.7 SHALL AFFECT THE RIGHT OF
EACH BANK TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT
THE RIGHT OF EACH BANK TO BRING ANY ACTION OR PROCEEDING AGAINST ANY BORROWER OR
ITS PROPERTY IN THE COURTS OF ANY OTHER PROPER JURISDICTION.
10.8 Application of Payments. After the occurrence and during the
continuance of an Event of Default, any contrary provision contained in this
Agreement or the other Loan Documents notwithstanding, the Administrative Agent
shall have the continuing exclusive right to apply and reapply any and all
payments received at any time or times hereafter, whether with respect to the
Collateral or otherwise, against the Liabilities in such manner as the
Administrative Agent may deem advisable, any entry by the Administrative Agent
upon its books and records notwithstanding, and each of the Borrowers hereby
irrevocably waives the right to direct the application of any and all payments
at any time or times hereafter received by the Administrative Agent from any
Borrower or with respect to any of the Collateral in such circumstances.
10.9 Adjustments; Set Off. stments; Set Off
(a) If any Bank (a "Benefited Bank") shall at any time receive any
payment of all or part of its Loans or the Reimbursement Obligations owing to
it, or interest thereon, or receive any Collateral in respect thereof (whether
voluntarily or involuntarily, by set-off, pursuant to events or proceedings of
the nature referred to in section 8.1(g), or otherwise), in a greater proportion
than any such payment to or Collateral received by any other Bank, if any, in
respect of such other Bank's Loans or the Reimbursement Obligations owing to it,
or interest thereon, such Benefited Bank shall purchase for cash from the other
Banks a participating interest in such portion of each such other Bank's Loan or
the Reimbursement Obligations owing to it, or shall provide such other Banks
with the benefits of any such Collateral, or the proceeds thereof, as shall be
necessary to cause such Benefited Bank to share the excess payment or benefits
of such Collateral or proceeds ratably with each of the Banks; provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such Benefited Bank, such purchase shall be rescinded,
and the purchase price and benefits returned, to the extent of such recovery,
but without interest.
(b) In addition to any rights and remedies of the Banks provided by
law, each Bank shall have the right, without prior notice to any Borrower, any
such notice being expressly waived by each such Borrower to the extent permitted
by applicable law, upon any amount becoming due and payable by each such
Borrower hereunder (whether at the stated maturity, by acceleration or
otherwise) to set-off and appropriate and apply against such amount any and all
deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Bank or any branch or agency
thereof to or for the credit or the account of each such Borrower. Each Bank
agrees promptly to notify the Borrower Agent and the Administrative Agent after
any such set-off and application made by such Bank, provided that the failure to
give such notice shall not affect the validity of such set-off and application.
10.10 Section Titles. The section and subsection titles contained in
this Agreement are for reference purposes only and shall be without substantive
meaning or content of any kind whatsoever and are not a part of the agreement
between the parties.
10.11 Continuing Effect. This Agreement, the Administrative Agent's
Liens on the Collateral, and all of the other Loan Documents shall continue in
full force and effect so long as any Liabilities shall be owed to the Banks, and
(even if there shall be no Liabilities outstanding) so long as this Agreement
has not been terminated as provided herein.
10.12 Notices. Except as otherwise expressly provided herein, any
notice required or desired to be served, given or delivered hereunder shall be
in writing, and shall be deemed to have been validly served, given or delivered
upon the earlier of (a) personal delivery to the address set forth below, (b) in
the case of mailed notice, three (3) days after deposit in the United States
mails, with proper postage for certified mail, return receipt requested,
prepaid, (c), in the case of telecopy notice, when received or (d) in the case
of notice by Federal Express or other reputable overnight courier service, one
(1) Business Day after delivery to such courier service, addressed as follows in
the case of the Borrowers and the Agents, and as set forth in Annex B in the
case of all of the other Banks, or to such other address as may be hereafter
notified by the respective parties hereto:
(i) If to the Administrative Agent, at:
BankBoston, N.A.
100 Federal Street
Boston, MA 02110
Attention: Daniel P. Corcoran, Jr., Director
Mail Code: 01-07-05
Telecopier No. 617-434-1279
with a copy to:
Peabody & Arnold
50 Rowes Wharf
Boston, MA 02110
Attention: Anil Khosla, Esq.
Telecopier No. 617-951-2125
(ii) If to the Documentation Agent, at:
USTrust
30 Court Street
Boston, MA 02108
Attention: Michael D. O'Neill, Senior Vice President
Telecopier No. 617-695-5250
with a copy to:
Peabody & Arnold
50 Rowes Wharf
Boston, MA 02110
Attention: Anil Khosla, Esq.
Telecopier No. 617-951-2125
(iii) If to any Borrower, at:
Fine Host Corporation
3 Greenwich Office Park
Greenwich, CT 06831
Attention: Richard E. Kerley, Chairman and CEO
Telecopier No. 203-629-5089
with a copy to:
Willkie Farr & Gallagher
One Citicorp Center
153 East 53rd Street
New York, NY 10022
Attention: Cornelius T. Finnegan, III, Esq.
Telecopier No. 212-821-8111
Notices sent by or to any Borrower shall be deemed to include the other
Borrowers for all purposes under this Agreement.
10.13 Equitable Relief. Each of the Borrowers recognizes that, in the
event that the Borrowers fail to perform, observe or discharge any of the
Liabilities under this Agreement, any remedy at law may prove to be inadequate
relief to the Banks. Therefore, the Borrowers agree that the Banks, if the Banks
so request, shall be entitled to temporary and permanent injunctive relief in
any such case without the necessity of proving actual damages.
10.14 Entire Agreement. This Agreement, together with the Loan
Documents executed in connection herewith, and all exhibits and schedules
attached hereto or thereto, constitutes the entire Agreement among the parties
with respect to the subject matter hereof, and supersedes all prior written oral
understandings with respect thereto.
10.15 Successors and Assigns; Participations and Assignments.
10.15.1 Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the Borrowers, the Banks, the
Administrative Agent and their respective successors and assigns,
except that none of the Borrowers may assign or transfer any of its
rights or obligations under this Agreement without the prior written
consent of each Bank and any assignment or transfer by any Bank of its
rights or obligations under this Agreement or any Loan Document must be
made in compliance with this subsection 10.15 (any purported assignment
in violation of this subsection shall be null and void).
10.15.2 Participations. Any Bank may, at any time, sell to one or
more financial institutions or other entities ("Loan Participants")
participating interests in any Loan owing to such Bank, any commitment
of such Bank or any other interest of such Bank hereunder and under the
other Loan Documents; provided, however, that such Bank obtains the
prior written consent of the Administrative Agent, which consent shall
not be unreasonably withheld or delayed. In the event of any such sale
by a Bank of a participating interest to a Loan Participant, (i) such
Bank's obligations under this Agreement to the other parties to this
Agreement shall remain unchanged, (ii) such Bank shall remain solely
responsible for the performance thereof, (iii) such Bank shall remain
the holder of any such Loan for all purposes under this Agreement and
the other Loan Documents, (iv) the Borrower Agent and the
Administrative Agent shall continue to deal solely and directly with
such Bank in connection with such Bank's rights and obligations under
this Agreement and the other Loan Documents, and (v) no Loan
Participant under any participation shall have any right to approve any
amendment or waiver of any provision of any Loan Document.
10.15.3 Assignments. Any Bank may, at any time, with the written
consent of the Borrower Agent and the Administrative Agent (which in
each case shall not be unreasonably withheld or delayed) assign to any
other Bank or any affiliate thereof or to an additional bank or
financial institution (an "Assignee") all or any part of its rights and
obligations under this Agreement and the other Loan Documents pursuant
to an Assignment and Assumption, substantially in the form of Annex C,
executed by such Assignee and such assigning Bank (and in the case of
an Assignee that is not then a Bank or an affiliate thereof, by the
Borrower Agent and the Administrative Agent) and delivered to the
Administrative Agent for its acceptance and recording in the Register;
provided, however, that in the case of any such assignment to an
additional bank or financial institution, if such assignment is of less
than all of the rights and obligations of the assigning Bank, then (a)
the sum of the aggregate principal amount of the Loans and the
aggregate amount of the unused Commitments being assigned to such an
additional bank or financial institution must not be less than Five
Million and 00/100 Dollars ($5,000,000.00); and (b) the sum of the
aggregate principal amount of the Loans and the aggregate amount of the
unused Commitments remaining with the assigning Bank must not be less
than Five Million and 00/100 Dollars ($5,000,000.00). Upon such
execution, delivery, acceptance and recording, from and after the
effective date determined pursuant to such Assignment and Assumption,
(i) the Assignee thereunder shall be a party hereto and, to the extent
provided in such Assignment and Assumption, have the rights and
obligations of a Bank hereunder with a Commitment as set forth therein,
and (ii) the assigning Bank thereunder shall, to the extent provided in
such Assignment and Assumption, be released from its obligations under
this Agreement (and, in the case of an Assignment and Assumption
covering all or the remaining portion of an assigning Bank's rights and
obligations under this Agreement, such assigning Bank shall cease to be
a party hereto). In addition to the assignments permitted under this
subsection 10.15.3, any Bank may assign and pledge all or any portion
of its pro rata share in the Loans to any Federal Reserve Bank as
collateral security pursuant to Regulation A of the Board of Governors
and any Operating Circular issued by the Federal Reserve Bank. No such
assignment shall release the assigning Bank from its obligations
hereunder.
10.15.4 Register.The Administrative Agent shall maintain a copy of
each Assignment and Assumption delivered to it and a register (the
"Register") for the recordation of the names and addresses of the Banks
and the Commitments of, and principal amounts of the Loans owing to,
each Bank from time to time. The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrowers, the
Administrative Agent and the Banks shall treat each Person whose name
is recorded in the Register as the owner of a Loan or other obligation
hereunder as the owner thereof for all purposes of this Agreement and
the other Loan Documents, notwithstanding any notice to the contrary.
Any assignment of any Loan or other obligation hereunder (whether or
not evidenced by a Note) shall be effective only upon appropriate
entries with respect thereto being made in the Register. The Register
shall be available for inspection by the Borrowers or any Bank at any
reasonable time and from time to time upon reasonable prior notice.
10.15.5 Processing Fee. Upon its receipt of an Assignment and
Assumption executed by an assigning Bank and an Assignee (and, in the
case of an Assignee that is not then a Bank or an affiliate thereof, by
the Borrower Agent and the Administrative Agent), together with, in the
case of an Assignee that is not then a Bank or an affiliate thereof,
payment to the Administrative Agent of a processing fee of Three
Thousand and 00/100 Dollars ($3,000.00), the Administrative Agent shall
(i) promptly accept such Assignment and Assumption and (ii) on the
effective date determined pursuant thereto record the information
contained therein in the Register and give notice of such acceptance
and recordation to the Banks and the Borrower Agent.
10.16 Changes in Accounting Principles. (a) If any changes in
accounting principles from those used in the preparation of the Initial
Financial Statements are hereafter occasioned by the promulgation of rules,
regulations, pronouncements, or opinions of, or required by, the Financial
Accounting Standards Board or the American Institute of Certified Public
Accountants (or successors thereto or agencies with similar functions), or there
shall occur any change in any Borrower's fiscal or tax years and, as a result of
any such changes, there shall result a change in the method of calculating any
of the financial covenants, negative covenants, standards, or other terms or
conditions found in this Agreement or any of the other Loan Documents, or (b) if
any Borrower, for reasonable business purposes, shall desire to change such
accounting principles or the application thereof (which change shall be
consistent with accounting principles then in effect pursuant to rules,
regulations, pronouncements, or opinions of the Financial Accounting Standards
Board or the American Institute of Certified Public Accountants) and such
desired change would result in a change in the method of calculating any of the
financial covenants, negative covenants or other terms and conditions found in
this Agreement or any of the other Loan Documents, then the parties hereto agree
to enter into negotiations in order to amend such provisions and the definition
of GAAP set forth in subsection 1.1 so as to reflect equitably such changes with
the desired result that the criteria for evaluating the financial condition and
performance of the Borrowers shall be the same after such changes as if such
changes had not been made.
10.17 Indemnity. Each of the Borrowers agrees to indemnify and hold the
Administrative Agent and each Bank and the officers, directors, employees and
Affiliates of the Administrative Agent and such Bank harmless from and against
any claims, demands, losses, damages, penalties, costs and expenses to which the
Administrative Agent, such Bank, its subsidiaries or any such Persons or
Affiliates may become subject, insofar as such claims, demands, losses, damages,
penalties, costs and expenses arise out of or by reason of any investigation,
litigation or other proceedings related to the transactions contemplated by this
Agreement, any of the other Loan Documents, and to reimburse the Administrative
Agent, each Bank and each such Person and Affiliate, upon demand, for any legal
or other expenses incurred in connection with investigating or defending any
such claims, demands, losses, damages, penalties, costs and expenses; provided,
however, that each of the Borrowers shall not be liable for any such claims,
demands, losses, damages, penalties, costs and expenses arising out of any such
action taken by the Administrative Agent or by the Banks or any such Person or
Affiliate to the extent that the same shall be determined by a court of
competent jurisdiction to have constituted gross negligence or willful
misconduct of the party to be indemnified. Without limiting the foregoing, the
Borrowers shall indemnify and hold harmless the Administrative Agent's and each
Bank's audit officers, directors, employees and Affiliates from and against any
claims, demands, penalties, costs and expenses associated with Environmental
Laws, Hazardous Substances, and any covenants, representations and warranties
relating thereto contained in this Agreement, no matter how arising, and all
matters listed in Schedule 5.19. The obligations of each of the Borrowers under
this subsection 10.17 shall survive repayment of the Liabilities and the other
Loan Documents.
10.18 Representations and Warranties. Anything to the contrary
contained herein notwithstanding, (i) each representation and warranty contained
in this Agreement or any of the other Loan Documents shall survive the execution
and delivery of this Agreement and the other Loan Documents and the making of
the Loans and the repayment of the Liabilities hereunder, (ii) each
representation and warranty contained in this Agreement and, except as otherwise
provided herein, each other Loan Document shall be remade on the date of each
Loan made hereunder, and (iii) each representation and warranty and other
covenant or obligation of the Borrowers contained in this Agreement or any other
Loan Document is made jointly and severally by the Borrowers.
10.19 Treatment of Certain InformationTreatment of Certain Information.
Each of the Borrowers (a) acknowledges that services may be offered or provided
to it (in connection with this Agreement or otherwise) by each Bank or by one or
more of their respective subsidiaries or affiliates and (b) acknowledges that
information delivered to each Bank by the Borrowers may be provided to each such
subsidiary and affiliate.
10.21 Time of the Essence. Time and punctuality shall be of the essence
with respect to this Agreement, but no delay or failure of the Administrative
Agent or any Bank to enforce any of the provisions herein contained and no
conduct or statement of the Administrative Agent or any Bank shall waive or
affect any of the Administrative Agent's or any Bank's rights hereunder.
10.22 Limitation on Liabilities - Joint Venture Subsidiary
Borrowers.
(a) Notwithstanding any term or provision contained in this Agreement
or in any of the other Loan Documents to the contrary (including, without
limitation, those relating to indemnification, costs and expenses), the sole
recourse of the Agents and the Banks against each Joint Venture Subsidiary
Borrower under this Agreement and all of the other Loan Documents for payment of
the Liabilities and for all other payments due hereunder or thereunder shall be
against the Joint Venture Collateral, and each Joint Venture Subsidiary Borrower
shall not be liable for any unpaid Liability or for any such other amount to the
extent that the proceeds of the sale or other disposition of the Joint Venture
Collateral are insufficient to pay such amounts; provided, however, that
notwithstanding the foregoing to the contrary, each such Joint Venture
Subsidiary Borrower shall be liable in its individual capacity to the Agents and
the Banks for any loss, expense, claim or damage suffered by any of the Agents
or the Banks as a result of the breach by such Joint Venture Subsidiary Borrower
of any of its representations, warranties or covenants contained in any of the
Loan Documents (other than this Agreement); provided further, however, that the
foregoing provisions of this subsection (a) shall in no way be deemed to affect
(i) any of the liabilities and obligations of any of the Borrowers (other than
those Borrowers that are Joint Venture Subsidiary Borrowers) under this
Agreement or any of the other Loan Documents; or (ii) the rights or interests of
the Agents and the Banks in and to the Joint Venture Collateral or any part
thereof or any other rights or remedies of any of the Agents or the Banks under
this Agreement or any of the other Loan Documents with respect to the Joint
Venture Collateral or under any other document, agreement or instrument securing
the Liabilities.
(b) Notwithstanding any term or provision contained in this Agreement
or any of the other Loan Documents to the contrary (including, without
limitation, those relating to indemnification, costs and expenses), the sole
recourse of the Agents and the Banks against each Joint Venture Subsidiary
Borrower under this Agreement and all of the other Loan Documents for payment of
the Liabilities and for all other payments due hereunder or thereunder shall be
against the assets of such Joint Venture Subsidiary Borrower as and to the
extent provided in the preceding subsection (a), and the Agents and the Banks
shall have no other recourse for any such payment against any of the joint
venturers of any Joint Venture Subsidiary Borrower (each such joint venturer is
hereinafter referred to as a "Joint Venturer") or any of their assets,
notwithstanding that any Joint Venturer might otherwise be liable for
obligations of such Joint Venture Subsidiary Borrower under applicable law, the
organizational documents of such Joint Venture Subsidiary Borrower or otherwise;
provided, however, that the foregoing provisions of this subsection (b) shall in
no way be deemed to affect (i) any of the liabilities and obligations of any of
the Borrowers (other than those Borrowers that are Joint Venture Subsidiary
Borrowers) under this Agreement or any of the other Loan Documents; or (ii) the
rights or interests of the Agents and the Banks in and to the Joint Venture
Collateral or any part thereof or any other rights or remedies of any of the
Agents or the Banks under this Agreement or any of the other Loan Documents with
respect to the Joint Venture Collateral or under any other document, agreement
or instrument securing the Liabilities. In the event of any inconsistency
between the provisions of this subsection (b) and the provisions of any of the
other Loan Documents (including, without limitations, provisions relating to
joint and several liability or liability on the part of any Person comprising
part of another Person), the provisions of this subsection (b) shall control.
10.23. Joint and Several Liability. All of the obligations and
liabilities of the Borrowers under this Agreement and all of the other Loan
Documents (including without limitation, all of the Liabilities) are joint and
several.
10.24 Documentation Agent. The Documentation Agent shall, unless it
otherwise consents in writing, have the sole authority and responsibility to
arrange for and manage the preparation, execution and delivery of the Loan
Documents (including without limitation, any and all amendments and
modifications thereto); provided, however, that the Administrative Agent shall
have the sole right to negotiate the terms and conditions of the Loan Documents
(including without limitation, any and all amendments and modifications thereto)
with the Borrowers, for and on behalf of the Banks, subject to the terms and
conditions of this Agreement; for such purposes, the Documentation Agent may
engage such legal counsel and other advisers for the benefit of the Banks, as
the Documentation Agent deems necessary or advisable. All of the reasonable
fees, costs and expenses of such legal counsel and other advisers shall be borne
by the Borrowers.
10.25 Borrower Agent. Each Borrower (other than Fine Host) hereby
irrevocably designates and appoints the Borrower Agent as the agent of such
Borrower under this Agreement and the other Loan Documents, and each such
Borrower irrevocably authorizes the Borrower Agent, in such capacity, to take
such action on its behalf under the provisions of this Agreement and the other
Loan Documents and to exercise such powers and perform such duties as are
expressly delegated to the Borrower Agent by the terms of this Agreement and the
other Loan Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in
this Agreement, the Borrower Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Borrower, and no implied covenants, functions,
responsibilities, duties, obligation or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the Borrower
Agent.
10.26 Applicable Law; Severability. THIS AGREEMENT SHALL BE CONSTRUED
IN ALL RESPECTS IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS AND DECISIONS OF
THE COMMONWEALTH OF MASSACHUSETTS, WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.
Whenever possible, each provision of this Agreement shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provisions or the
remaining provisions of this Agreement.
[THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK]
<PAGE>
IN WITNESS WHEREOF, this Agreement has been duly executed as an
instrument under seal by the duly authorized representative of each party
hereto, as of the day and year first above written.
BANKBOSTON, N.A. AS USTRUST AS
ADMINISTRATIVE AGENT DOCUMENTATION AGENT
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
BANKBOSTON, N.A. AS LENDER USTRUST AS LENDER
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
STATE STREET BANK AND TRUST THE SUMITOMO BANK, LIMITED
COMPANY
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
By:______________________________
Title:_____________________________
MELLON BANK, N.A. THE BANK OF NEW YORK
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
KEYBANK, N.A. FIRST UNION BANK OF CONNECTICUT
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
BANK OF SCOTLAND THE BANK OF NOVA SCOTIA
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
NATIONAL WESTMINSTER BANK LEUMI TRUST COMPANY OF NEW YORK
BANK P.L.C.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST CORPORATION FINE HOST SERVICES CORPORATION
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST OF VERMONT, INC. FANFARE, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
GLOBAL FANFARE, INC. FINE HOST INTERNATIONAL
CORPORATION
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
CREATIVE FOOD MANAGEMENT NORTHWEST FOOD SERVICE, INC.
INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
TARRANT COUNTY SUN WEST SERVICES, INC.
CONCESSIONS, L.L.C.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
REPUBLIC MANAGEMENT CORP. VERSATILE HOLDING CORPORATION
OF MASSACHUSETTS
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
SERV-RITE CORPORATION IDEAL MANAGEMENT SERVICES, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
SERVICE DYNAMICS CORP. PCS HOLDING CORP. (f/k/a HCS
Management Corp.)
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
PCS MANAGEMENT CORP. HEARTSTRINGS GIFT SHOPS, INC.
(f/k/a N.C. PCSM, Inc.) (f/k/a Hospital Coffee Shoppes, Inc.)
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
THE ENVIRONMENTAL GROUP, CREATIVE DATA SYSTEMS, INC.
INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST/R&N/A CUP ABOVE JOINT
VENTURE, a joint venture
By: Fine Host Corporation, in its capacity as a
joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
By: ____________________________________
Tyrone W. Nabbie (together with Ronald O.
Rogers, doing business as R&N Management
Services), in his capacity as a joint venturer
of aforesaid joint venture
By: ____________________________________
Ronald O. Rogers (together with Tyrone W.
Nabbie, doing business as R&N Management
Services), in his capacity as a joint venturer
of aforesaid joint venture
By: ____________________________________
Ellen Korbin (doing business as A Cup
Above), in her capacity as a joint venturer
of aforesaid joint venture
FINE HOST/S. BROOKS &
ASSOCIATES JOINT VENTURE, a joint venture
By: Fine Host Corporation, in its capacity as a
joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
By: S. Brooks & Associates, Inc., in its capacity
as a joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
WISCONSIN CENTER JOINT VENTURE,
a joint venture
By: Fine Host Corporation, in its capacity as a
joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
By: Five-Star Marketing, Inc., in its capacity
as a joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
PABOS2:FSH:66648_8
<PAGE>
ANNEX A
PRICING GRID
============================ --------------------- =======================
Ratio of Consolidated Debt Applicable Margin for
to LIBOR Loans Unused Commitment Fee
Adjusted Consolidated EBITDA
============================ --------------------- =======================
Greater than or equal to
2.50 to 1 1.50% 0.325%
============================ --------------------- =======================
Less than 2.50 to 1
Greater than or equal to
2.25 to 1 1.25% 0.275%
============================ --------------------- =======================
Less than 2.25 to 1
Greater than or equal to
1.50 to 1 1.00% 0.275%
============================ ===================== =======================
Less than 1.50 to 1 .75% 0.225%
============================ ===================== =======================
<PAGE>
ANNEX B
COMMITMENTS, LENDING OFFICES AND ADDRESSES
================================================================================
BANKBOSTON, N.A.
Amount of Closing Fee
Working Capital Commitment Guidance Loan Commitment To Be Received
$6,250,000.00 $18,750,000.00 $46,000.00
Domestic Lending Office: LIBOR Lending Office: Address for Notices:
BankBoston, N.A. BankBoston, N.A. BankBoston, N.A.
100 Federal Street 100 Federal Street 100 Federal Street
Boston, MA 02110 Boston, MA 02110 Boston, MA 02110
Attn: Daniel P. Corcoran Attn: Daniel P. Corcoran Attn: Daniel P. Corcoran
Director Director Director
Mail Code: 01-07-05 Mail Code: 01-07-05 Mail Code: 01-07-05
Telephone: 617-434-2251
Telecopier: 617-434-8102
================================================================================
================================================================================
USTRUST
Amount of Closing Fee
Working Capital Commitment Guidance Loan Commitment To Be Received
$5,000,000.00 $15,000,000.00 $27,000.00
Domestic Lending Office: LIBOR Lending Office: Address for Notices:
USTrust USTrust USTrust
30 Court Street 30 Court Street 30 Court Street
Boston, MA 02108 Boston, MA 02108 Boston, MA 02108
Attn: Michael D. O'Neill Attn: Michael D. O'Neill Attn: Michael D. O'Neill
Senior V.P. Senior V.P. Senior V.P.
Telephone: 617-726-7198
Telecopier: 617-695-5250
================================================================================
================================================================================
THE SUMITOMO BANK, LIMITED
Amount of Closing Fee
Working Capital Commitment Guidance Loan Commitment To Be Received
$5,000,000.00 $15,000,000.00 $27,000.00
Domestic Lending Office: LIBOR Lending Office: Address for Notices:
The Sumitomo Bank, Ltd The Sumitomo Bank, Ltd The Sumitomo Bank, Ltd
Chicago Branch Chicago Branch 450 Lexington Avenue
233 South Wacker Drive 233 South Wacker Drive Suite 1700
Suite 50400 Suite 50400 New York, NY 10017
Chicago, IL 60606 Chicago, IL 60606 Attn: Ronald W. Gale
Vice President
Telephone: 212-808-2337
Telecopier: 212-818-8065
================================================================================
================================================================================
STATE STREET BANK AND TRUST COMPANY
Amount of Closing Fee
Working Capital Commitment Guidance Loan Commitment To Be Received
$5,000,000.00 $15,000,000.00 $27,000.00
Domestic Lending Office: LIBOR Lending Office: Address for Notices:
State Street Bank and State Street Bank and Trust State Street Bank and
Trust Company Trust Company Trust Company
225 Franklin Street 225 Franklin Street 225 Franklin Street
Boston, MA 02110 Boston, MA 02110 Boston, MA 02110
Attn: Arlene M. Doherty Attn: Arlene M. Doherty Attn: Arlene M. Doherty
Vice President Vice President Vice President
Telephone: 617-664-4473
Telecopier: 617-654-4176
================================================================================
================================================================================
MELLON BANK, N.A.
Amount of Closing Fee
Working Capital Commitment Guidance Loan Commitment To Be Received
$5,000,000.00 $15,000,000.00 $34,000.00
Domestic Lending Office: LIBOR Lending Office: Address for Notices:
Mellon Bank, N.A. Mellon Bank, N.A. Mellon Bank, N.A.
c/o Mellon Financial c/o Mellon Financial c/o Mellon Financial
Services Services Services
Raritan Plaza I Raritan Plaza I Raritan Plaza I
Raritan Center Raritan Center Raritan Center
Edison, NJ 08837 Edison, NJ 08837 Edison, NJ 08837
Attn: David W. Kaiser Attn: David W. Kaiser Attn: David W. Kaiser
Vice President Vice President Vice President
Telephone: 908-225-4791
Telecopier: 908-225-4820
================================================================================
================================================================================
THE BANK OF NEW YORK
Amount of Closing Fee
Working Capital Commitment Guidance Loan Commitment To Be Received
$5,000,000.00 $15,000,000.00 $34,000.00
Domestic Lending Office: LIBOR Lending Office: Address for Notices:
The Bank of New York The Bank of New York The Bank of New York
10 Mason Street, 3rd Fl 10 Mason Street, 3rd Fl 10 Mason Street, 3rd Fl
Greenwich, CT 06830 Greenwich, CT 06830 Greenwich, CT 06830
Attn: Margaret J. Nolan Attn: Margaret J. Nolan Attn: Margaret J. Nolan
Asst. Treasurer Asst. Treasurer Asst. Treasurer
Telephone: 203-863-2680
Telecopier: 203-863-2610
================================================================================
================================================================================
KEYBANK, N.A.
Amount of Closing Fee
Working Capital Commitment Guidance Loan Commitment To Be Received
$3,125,000.00 $9,375,000.00 $30,000.00
Domestic Lending Office: LIBOR Lending Office: Address for Notices:
KeyBank, N.A. KeyBank, N.A. KeyBank, N.A.
One Canal Plaza One Canal Plaza One Canal Plaza
Portland, ME 04101 Portland, ME 04101 Portland, ME 04101
Attn: Jane A. Parker Attn: Jane A. Parker Attn: Jane A. Parker
Vice President Vice President Vice President
Structured Finance Structured Finance Structured Finance
Telephone: 207-874-7029
Telecopier: 207-874-7166
================================================================================
================================================================================
FIRST UNION BANK OF CONNECTICUT
Amount of Closing Fee
Working Capital Commitment Guidance Loan Commitment To Be Received
$3,500,000.00 $10,500,000.00 $33,600.00
Domestic Lending Office: LIBOR Lending Office: Address for Notices:
First Union Bank of First Union Bank of First Union Bank of
Connecticut Connecticut Connecticut
300 Main Street 300 Main Street 300 Main Street
Stamford, CT 06904-0700 Stamford, CT 06904-0700 Stamford, CT 06904-0700
Attn: Anne Wilson Attn: Anne Wilson Attn: Anne Wilson,
Vice President Vice President Vice President
Telephone:203-406-6041
Telecopier: 203-964-8239
================================================================================
================================================================================
BANK OF SCOTLAND
Amount of Closing Fee
Working Capital Commitment Guidance Loan Commitment To Be Received
$3,125,000.00 $9,375,000.00 $30,000.00
Domestic Lending Office: LIBOR Lending Office: Address for Notices:
Bank of Scotland Bank of Scotland Bank of Scotland
565 Fifth Avenue 565 Fifth Avenue One Post Office Square
New York, NY 10017 New York, NY 10017 Suite 3750
Attn: Annie Chin Tat Attn: Annie Chin Tat Boston, MA 02109
Vice President Vice President Attn: William Boland,
Director
Telephone: 617-426-1059
Telecopier: 617-426-1353
with copy to:
Bank of Scotland
565 Fifth Avenue
New York, NY 10017
Attn: Annie Chin Tat
Vice President
Telephone: 212-450-0871
Telecopier: 212-557-9460
================================================================================
================================================================================
THE BANK OF NOVA SCOTIA
Amount of Closing Fee
Working Capital Commitment Guidance Loan Commitment To Be Received
$3,125,000.00 $9,375,000.00 $30,000.00
Domestic Lending Office: LIBOR Lending Office: Address for Notices:
The Bank of Nova Scotia The Bank of Nova Scotia The Bank of Nova Scotia
One Liberty Plaza One Liberty Plaza One Liberty Plaza
New York, NY 10006 New York, NY 10006 New York, NY 10006
Attn: Kevin D. McCarthy, Attn: Kevin D. McCarthy, Attn: Kevin D. McCarthy,
Relationship Mgr. Relationship Mgr. Relationship Mgr.
Telephone: 212-225-5074
Telecopier: 212-225-5090
================================================================================
================================================================================
NATIONAL WESTMINSTER BANK P.L.C.
Amount of Closing Fee
Working Capital Commitment Guidance Loan Commitment To Be Received
$3,500,000.00 $10,500,000.00 $33,600.00
Domestic Lending Office: LIBOR Lending Office: Address for Notices:
National Westminster Bank National Westminster Bank National Westminster Bank
P.L.C. P.L.C. P.L.C.
175 Water Street, 26th Fl 175 Water Street, 26th Fl 175 Water Street, 26th Fl
New York, NY 10038 New York, NY 10038 New York, NY 10038
Attn: Wakefield Smith Attn: Wakefield Smith Attn: Wakefield Smith
Vice President Vice President Vice President
Telephone: 212-602-8969
Telecopier: 212-602-4319
================================================================================
================================================================================
BANK LEUMI TRUST COMPANY OF NEW YORK
Amount of Closing Fee
Working Capital Commitment Guidance Loan Commitment To Be Received
$2,375,000.00 $7,125,000.00 $22,800.00
Domestic Lending Office: LIBOR Lending Office: Address for Notices:
Bank Leumi Trust Company of Bank Leumi Trust Company of Bank Leumi Trust Company
New York New York of New York
562 Fifth Avenue 562 Fifth Avenue 562 Fifth Avenue
New York, NY 10036 New York, NY 10036 New York, NY 10036
Attn: Paul Tine Attn: Paul Tine Attn: Paul Tine
Telephone: 212-626-1386
Telecopier: 212-626-1311
================================================================================
66648_8
<PAGE>
ANNEX C
[FORM OF ASSIGNMENT AND ASSUMPTION]
ASSIGNMENT AND ASSUMPTION
Reference is made to a certain Fourth Amended and Restated Loan
Agreement, dated as of July __, 1997 (as the same may be hereafter further
amended, modified, supplemented, extended or restated from time to time, the
"Loan Agreement") by and among (a) Fine Host Corporation, a Delaware corporation
and all of its Subsidiaries (hereinafter referred to collectively as the
"Borrowers" and each singly as a "Borrower"), (c) various banks and other
financial institutions which are, or may become, parties thereto (collectively,
the "Banks"), (d) BankBoston, N.A. as Administrative Agent for the Banks (in
such capacity, the "Administrative Agent"), and (e) USTrust as Documentation
Agent for the Banks. All capitalized terms not defined herein but defined in the
Loan Agreement shall have the meanings given to such terms in the Loan
Agreement.
___________ (the "Assignor") and ____________ (the "Assignee") agree as follows:
1. The Assignor hereby irrevocably sells and assigns to the Assignee
without recourse to the Assignor, and the Assignee hereby irrevocably purchases
and assumes from the Assignor without recourse to the Assignor, as of the
Effective Date (as defined below) (but not prior to the registration of the
information contained herein in the Register pursuant to subsection 10.15.5 of
the Loan Agreement), a ____% interest (the "Assigned Interest") in and to the
Assignor's rights and obligations under the Loan Agreement with respect to those
credit facilities contained in the Loan Agreement as are set forth on Schedule 1
(hereinafter referred to collectively as the "Assigned Facilities" and each
singly as an "Assigned Facility"), in a principal amount for each Assigned
Facility as set forth on Schedule 1.
2. The Assignor (a) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Loan Agreement or with respect to the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Loan Agreement, any other Loan Document or any other instrument or
document furnished pursuant thereto, other than that the Assignor has not
created any adverse claim upon the interest being assigned by it hereunder and
that such interest is free and clear of any such adverse claim; (b) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of any Borrower or any other obligor or the performance or
observance by any Borrower or any other obligor of any of their respective
obligations under the Loan Agreement or any other Loan Document or any other
instrument or document furnished pursuant hereto or thereto; and (c) (i)
requests that the Administrative Agent, upon request by the Assignee, (a)
exchange any attached Notes for a new Note or Notes payable to the Assignee or,
(b) if the Assignor does not hold any Notes, issue a new Note or Notes payable
to the Assignee and (ii) if (A) the Assignor has retained any interest in the
Assigned Facility and (B) the Assignor holds any Notes, requests that the
Administrative Agent exchange the attached Notes for a new Note or Notes payable
to the Assignor, in each case in amounts which reflect the assignment being made
hereby (and after giving effect to any other assignments which have become
effective on the Effective Date).
3. The Assignee (a) represents and warrants that it is legally
authorized to enter into this Assignment and Assumption; (b) confirms that it
has received a copy of the Loan Agreement, together with copies of the financial
statements delivered pursuant to subsection 6.1 thereof and such other documents
and information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Assumption; (c) agrees that it will,
independently and without reliance upon the Assignor, the Administrative Agent
or any other Bank and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Agreement, the other Loan Documents or any
other instrument or document furnished pursuant hereto or thereto; (d) appoints
and authorizes the Administrative Agent to take such action as agent on its
behalf and to exercise such powers and discretion under the Loan Agreement, the
other Loan Documents or any other instrument or document furnished pursuant
hereto or thereto as are delegated to the Administrative Agent by the terms
thereof, together with such powers as are incidental thereto; and (e) agrees
that it will be a party to and bound by the provisions of the Loan Agreement and
will perform in accordance with its terms all the obligations which by the terms
of the Loan Agreement are required to be performed by it as a Bank including, if
it is organized under the laws of a jurisdiction outside the United States, its
obligations pursuant to subsection 3.10(b) of the Loan Agreement.
4. The effective date of this Assignment and Assumption shall be ______
___, 1997 (the "Effective Date"). Following the execution of this Assignment and
Assumption, it will be delivered to the Administrative Agent for acceptance by
it and recording by the Administrative Agent pursuant to the Loan Agreement,
effective as of the Effective Date (which shall not, unless otherwise agreed to
by the Administrative Agent, be earlier than five Business Days after the date
of such acceptance and recording by the Administrative Agent).
5. Upon such acceptance and recording, from and after the Effective
Date, the Administrative Agent shall make all payments in respect of the
Assigned Interest (including payments of principal, interest, fees and other
amounts) to the Assignee whether such amounts have accrued prior to the
Effective Date or accrue subsequent to the Effective Date. The Assignor and the
Assignee shall make all appropriate adjustments in payments by the
Administrative Agent for periods prior to the Effective Date or with respect to
the making of this assignment directly between themselves.
6. From and after the Effective Date, (a) the Assignee shall be a party
to the Loan Agreement and, to the extent provided in this Assignment and
Assumption, have the rights and obligations of a Bank thereunder and under the
other Loan Documents and shall be bound by the provisions thereof and (b) the
Assignor shall, to the extent provided in this Assignment and Assumption,
relinquish its rights and be released from its obligations under the Loan
Agreement.
7. This Assignment and Assumption shall be governed by and construed in
accordance with the laws of The Commonwealth of Massachusetts.
8. This Agreement may be executed by one or more of the parties to this
Agreement on any number of separate counterparts (including by facsimile
transmission ), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Assumption to be executed by their respective duly authorized officers as of the
date first above written on Schedule 1 attached hereto.
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By:________________________________ By:________________________________
Name: Name:
Title: Title:
ACCEPTED: CONSENTED TO:
BANKBOSTON, N.A., AS FINE HOST CORPORATION AS
ADMINISTRATIVE AGENT BORROWER AGENT FOR THE BORROWERS
By:________________________________ By:________________________________
Name: Name:
Title: Title:
<PAGE>
Schedule 1
to Assignment and Assumption
Re: Assignment and Assumption relating to a certain Fourth Amended and
Restated Loan Agreement, dated as of July __, 1997 (as the same may be
hereafter further amended, modified, supplemented, extended or restated
from time to time, the "Loan Agreement") by and among (a) Fine Host
Corporation, a Delaware corporation and all of its Subsidiaries
(hereinafter referred to collectively as the "Borrowers" and each
singly as a "Borrower"), (c) various banks and other financial
institutions which are, or may become, parties thereto (collectively,
the "Banks"), (d) BankBoston, N.A. as administrative agent for the
Banks (in such capacity, the "Administrative Agent"), and (e) USTrust
as documentation agent for the Banks.
- -----------------------------------------------------------------------------
Name of Assignor:
Name of Assignee:
Effective Date of Assignment:
Credit Principal Commitment Percentage
Facility Assigned Amount Assigned Assigned1/
$ %
----------- ---------
The terms set forth above are hereby agreed to by:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By:________________________________ By:________________________________
Name: Name:
Title: Title:
ACCEPTED: CONSENTED TO:
BANKBOSTON, N.A., AS FINE HOST CORPORATION AS
ADMINISTRATIVE AGENT BORROWER AGENT FOR THE BORROWERS
By:________________________________ By:________________________________
Name: Name:
Title: Title:
1/ Calculate the Commitment Percentage that is assigned to at least 15
decimal places and show as a percentage of the aggregate commitments of
all Banks.
<PAGE>
ANNEX D
FORM OF
SUBORDINATION PROVISIONS
1. Introduction. Any and all promissory notes or other evidences of
Subordinated Debt shall have subordination provisions substantially as set forth
in Part 2 of this Annex D. As used in this Annex D, the following terms shall
have the meanings set forth below:
"Agreement" means the agreement pursuant to which a Permitted
Acquisition is effected or, if different, pursuant to which a Note is issued.
"Maker" means the issuer of a Note.
"Note" means any promissory note or other evidence of the Subordinated
Debt issued in a Permitted Acquisition.
"Payee" means the original obligor under a Note.
2. Subordination Provisions.
_. The Payee and each holder from time to time of this Note by its
acceptance thereof agrees that all payments on this Note shall be subordinate
and subject in right of payment, to the extent set forth in this Paragraph __,
to the prior payment in full in cash of all Senior Debt (as defined below). The
provisions of this Paragraph __ are made for the benefit of all present and
future holders of Senior Debt and their successors and assigns (irrespective of
whether such Senior Debt was created, incurred or acquired before or after the
effectiveness of this Note or the Agreement) and shall be enforceable by each of
them directly against the Payee or any holder of this Note from time to time.
This Paragraph __ may not be amended without the written consent of each holder
of Senior Debt (or by the holders of the percentage of Senior Debt specified in
the applicable Senior Debt Agreement), and any purported amendment without such
consent shall be void.
_.1
(a) Upon any payment or distribution of assets or securities
of the Maker or any subsidiary thereof of any kind or character
(whether in cash, property or securities) upon any dissolution, winding
up or total or partial liquidation or reorganization of the Maker,
whether voluntary or involuntary or in a bankruptcy, insolvency,
receivership or other proceeding (an "Insolvency Event"), all Senior
Debt shall first be paid in full in cash before the Payee or any holder
of this Note shall be entitled to receive, directly or indirectly, any
payment of the principal of, or interest on or any other amount due
with respect to this Note or to receive any distribution of any assets
or securities of the Maker or any subsidiary thereof. Before any
payment of the principal of, or interest on or any other amount due
with respect to this Note upon any such Insolvency Event, any payment
or distribution of assets or securities of the Maker or any subsidiary
thereof of any kind or character (whether in cash, property or
securities) to which the Payee or the holder of this Note would be
entitled but for the provisions of this Paragraph __ shall be made by
the Maker or by any receiver, trustee in bankruptcy, liquidating
trustee, agent or other person making such payment or distribution,
directly to the holders of Senior Debt to the extent necessary to pay
the Senior Debt in full in cash after giving effect to any concurrent
payment or distribution to the holders of Senior Debt.
(b) No direct or indirect payment by or on behalf of the Maker
of the principal of or interest on or any other amount due with respect
to this Note (whether upon acceleration or otherwise) shall be made if,
at the time of such payment, there exists any default or event of
default under any Senior Debt Agreement (a "Blocking Event").
(c) The Payee shall not declare this Note to be due and
payable, and this Note shall not otherwise become due and payable prior
to its stated maturity upon the occurrence of any default hereunder or
under the Agreement, unless and until there shall previously have been
an acceleration of the Bank Liabilities and, if required by the terms
of any other Senior Debt Agreement, the Senior Debt issued pursuant to
such Senior Debt Agreement, in each case as a result of the occurrence
of a default thereunder or with respect thereto.
If, notwithstanding the foregoing provisions prohibiting such payment
or distribution, the Payee or any holder of this Note shall have received any
payment on account of this Note at any time following the occurrence of an event
described in Paragraph __.1(a) above or following receipt by such party from any
holder of Senior Debt of written notice to the effect that a Blocking Event has
occurred and is continuing, and before all Senior Debt is paid in full in cash,
then such payment or distribution shall be received and held in trust for the
holders of Senior Debt and shall be paid over or delivered to the holders of
Senior Debt remaining unpaid to the extent necessary to pay in full all Senior
Debt in cash.
_.2 Upon the occurrence of any Insolvency Event, all claims of the
holder of this Note in such Insolvency Event shall be deemed to be assigned to
the holders of Senior Debt. The holder of this Note hereby agrees to execute all
documents that the holders of Senior Debt request in order to effectuate such
assignment; provided, however, that such assignment shall terminate upon receipt
by the holders of Senior Debt of payment in full of all of the Senior Debt.
While such assignment is in effect, the holders of Senior Debt shall have the
exclusive right to exercise all rights of the holder of this Note arising from
its claims under the Insolvency Event (including, but not limited to, the right
to file appropriate proofs of claims in respect of this Note, and the right to
vote and to accept or reject a proposed plan of reorganization or composition).
_.3 No right of any holder of Senior Debt to enforce these
subordination provisions shall at any time or in any way be prejudiced or
impaired by any failure to act by the holders of Senior Debt or by any
noncompliance by the Maker with the terms and provisions and covenants herein or
in the Agreement, regardless of any knowledge thereof that a holder of Senior
Debt may have or otherwise be charged with. The provisions of this Paragraph __
are intended to be for the benefit of, and shall be enforceable directly by, any
present or future holder of Senior Debt.
_.4 The Payee and each holder of this Note by his acceptance thereof
agrees not to sell, assign or transfer all or any part of this Note while any
Senior Debt remains unpaid unless such sale, assignment or transfer is made
expressly subject to this Paragraph __.
_.5 Upon the payment in full, in cash, of all Senior Debt, the Payee
and or any other holder of this Note shall be subrogated to the rights of the
holders of Senior Debt to receive payments or distributions of cash, property or
securities of the Maker applicable to Senior Debt until this Note shall have
been paid in full.
_.6 The Payee and each other holder of this Note agree to forbear and
not take any action the purpose or effect of which would give them a preference
or priority over any Senior Debt.
_.7 All payments required to be made to the holders of the Senior Debt
by any person or entity pursuant to this Paragraph __, shall be first applied to
payment of the Bank Liabilities and the other Senior Debt, pro rata, until paid
in full.
_.8 For purposes of this Paragraph __, the following terms shall have
the meanings provided below:
"Bank Agreement" means the Fourth Amended and Restated Loan
Agreement, dated as of July __, 1997, by and among (a) Fine Host
Corporation and all of its subsidiaries, (b) BankBoston, N.A. as
Administrative Agent, (c) USTrust as Documentation Agent and (d)
various banks and other financial institutions which are or may become
parties thereto, together with any and all agreements, instruments and
other documents executed in connection therewith, all as the same may
be amended, restated, amended and restated, modified, supplemented,
otherwise changed from time to time, renewed, replaced, refinanced or
extended.
"Bank Liabilities" means "Liabilities" as that term is defined in the
Bank Agreement.
"Senior Debt" means (a) the Bank Liabilities, (b) to the
extent permitted by subsection 7.3 of the Bank Agreement, (i) all
obligations of the Maker in respect of any other indebtedness to banks,
financial institutions or institutional lenders or investors including,
without limitation, obligations in respect of principal, premium,
interest, reimbursement obligations and fees and expenses, and (ii) all
obligations of the Maker as lessee under leases required to be
capitalized on the balance sheet of the lessee under generally accepted
accounting principles and leases of property or assets made as part of
any sale and leaseback transaction to which the Maker is a party, and
(c) any and all renewals, extensions, increases or rearrangements of
any of the foregoing, in each case, whether existing on the date of
this Note or hereafter created, incurred or acquired. Without limiting
or expanding the foregoing provisions of this definition, this Note is
not intended to be either superior or subject in right of payment to
any obligation of the Maker, whether existing on the date of this Note
or hereafter created, incurred or acquired, under any other note or
instrument given to any other seller or sellers in connection with the
acquisition of any business, properties or assets by the Maker or any
subsidiary thereof.
"Senior Debt Agreement" means, with respect to any Senior
Debt, the agreement or agreements pursuant to which such Senior Debt
was issued or the instrument or instruments evidencing such Senior
Debt, as applicable.
68936_3
EXHIBIT A
[FORM OF FIRST AMENDED AND RESTATED
WORKING CAPITAL NOTE]
THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS AND
PROVISIONS OF THE LOAN AGREEMENT REFERRED TO BELOW. TRANSFERS OF THIS NOTE MUST
BE RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO
THE TERMS OF SUCH LOAN AGREEMENT.
FIRST AMENDED AND RESTATED WORKING CAPITAL NOTE
$______________ [Closing Date]
FOR VALUE RECEIVED, the undersigned, Fine Host Corporation, a Delaware
corporation, and all of its Subsidiaries (collectively, the "Borrowers"), hereby
jointly and severally and unconditionally promise to pay to the order of
______________________________ (the "Bank") at the office of BankBoston, N.A.,
located at 100 Federal Street, Boston, Massachusetts 02110, in lawful money of
the United States of America and in immediately available funds, on the Working
Capital Maturity Date the principal amount of ________________________ and
00/100 Dollars ($______________________), or, if less, the aggregate unpaid
principal amount of all Working Capital Loans made by the Bank to the Borrower
Agent pursuant to subsection 2.1 of the Loan Agreement (as defined below). The
Borrowers further agree to pay interest in like money at such office on the
unpaid principal amount of Working Capital Loans made by the Bank from time to
time outstanding at the rates and on the dates specified in subsection 3.4 of
the Loan Agreement.
Reference is hereby made to that certain Fourth Amended and Restated
Loan Agreement, dated of even date herewith (as the same may be hereafter
further amended, modified, supplemented, extended or restated from time to time,
the "Loan Agreement") by and among the Borrowers, BankBoston, N.A. as
Administrative Agent, USTrust as Documentation Agent, the Bank and certain other
banks and financial institutions which are or may hereafter be parties thereto
from time to time. All capitalized terms not defined herein but defined in the
Loan Agreement shall have the meanings given to such terms in the Loan
Agreement.
The holder of this Note is authorized to endorse on the Schedules A and
B annexed hereto and made a part hereof or on a continuation thereof which shall
be attached hereto and made a part hereof the date, Type and amount of each
Working Capital Loan made by the Bank and the date and amount of each payment or
prepayment of principal thereof, each conversion of all or a portion thereof to
another Type, each continuation of all or a portion thereof as the same Type
and, in the case of LIBOR Loans, the length of each Interest Period and the
LIBOR Rate with respect thereto. Each such endorsement shall constitute prima
facie evidence of the accuracy of the information endorsed; provided, however,
that the failure to make any such endorsement shall not affect the obligation of
the Borrowers to repay Working Capital Loans (with applicable interest) pursuant
to the Loan Agreement.
This Note (a) is one of the Working Capital Notes referred to in the
Loan Agreement; (b) is subject to the provisions of the Loan Agreement and (c)
is subject to optional and mandatory prepayment in whole or in part as provided
in the Loan Agreement. This Note is secured as provided in the Loan Documents.
Reference is hereby made to the Loan Documents for a description of the
properties and assets in which a security interest has been granted, the nature
and extent of the security, the terms and conditions upon which the security
interests were granted and the rights of the holder of this Note in respect
thereof.
Upon the occurrence and during the continuance of any one or more of
the Events of Default, all amounts then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable, all as provided
in the Loan Agreement.
All parties now and hereafter liable with respect to this Note, whether
maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind.
All of the obligations and liabilities of the Borrowers (including
without limitation, the Joint Venture Subsidiary Borrowers) under this Note are
joint and several.
Notwithstanding any provision contained in this Note to the contrary,
the liabilities and obligations of the Joint Venture Subsidiary Borrowers under
this Note are limited to the extent provided in subsection 10.22 of the Loan
Agreement.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE COMMONWEALTH OF MASSACHUSETTS.
This Note and all of the other Working Capital Notes referred to in the
Loan Agreement amend and restate in their entirety all of the Existing Working
Capital Notes. Upon the execution and delivery by the Borrowers of this Note and
all of the other Working Capital Notes, this Note and all of the other Working
Capital Notes shall collectively replace in their entirety all of the Existing
Working Capital Notes and shall immediately evidence all outstanding
indebtedness under the Existing Working Capital Notes. The Borrowers hereby
agree that the indebtedness embodied in and evidenced by this Note and all of
the other Working Capital Notes is the same indebtedness embodied in and
evidenced by the Existing Working Capital Notes, as increased as provided in
this Note and in the other Working Capital Notes, and that such indebtedness is
a continuing obligation of the Borrowers, and has been and continues to be fully
enforceable, absolute and in existence.
IN WITNESS WHEREOF, the undersigned have executed this Note under seal
as of the date first written above.
FINE HOST CORPORATION FINE HOST SERVICES CORPORATION
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
<PAGE>
FINE HOST OF VERMONT, INC. FANFARE, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
GLOBAL FANFARE, INC. FINE HOST INTERNATIONAL
CORPORATION
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
CREATIVE FOOD MANAGEMENT, NORTHWEST FOOD SERVICE, INC.
INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
TARRANT COUNTY CONCESSIONS, L.L.C. SUN WEST SERVICES, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
REPUBLIC MANAGEMENT CORP. VERSATILE HOLDING CORPORATION
OF MASSACHUSETTS
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
SERV-RITE CORPORATION IDEAL MANAGEMENT SERVICES, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
SERVICE DYNAMICS CORP. PCS HOLDING CORP.
(f/k/a HCS Management Corp.)
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
<PAGE>
PCS MANAGEMENT CORP. HEARTSTRINGS GIFT SHOPS, INC.
(f/k/a N.C. PCSM, Inc.) (f/k/a Hospital Coffee Shoppes, Inc.)
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
THE ENVIRONMENTAL GROUP, INC. CREATIVE DATA SYSTEMS, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST/S. BROOKS & ASSOCIATES
JOINT VENTURE
By: Fine Host Corporation, in its capacity as a joint
venturer of aforesaid Joint Venture
By: ______________________________
Title: _____________________________
By: S. Brooks & Associates, Inc., in its capacity as a
joint venturer of aforesaid Joint Venture
By: ______________________________
Title: _____________________________
FINE HOST/R&N/A CUP ABOVE JOINT VENTURE
By: Fine Host Corporation, in its capacity as a joint
venturer of aforesaid Joint Venture
By: ________________________________
Title: ______________________________
By: ____________________________________
Tyrone W. Nabbie (together with Ronald O. Rogers, doing
business as R&N Management Services), in his capacity
as a joint venturer of aforesaid Joint Venture
By: ____________________________________
Ronald O. Rogers (together with Tyrone W. Nabbie, doing
business as R&N Management Services), in his capacity
as a joint venturer of aforesaid Joint Venture
By: __________________________________
Ellen Korbin (doing business as A Cup Above), in her
capacity as a joint venturer of aforesaid Joint Venture
<PAGE>
WISCONSIN CENTER JOINT VENTURE
By: Fine Host Corporation, in its capacity
as a joint venturer of aforesaid Joint
Venture
By:______________________________
Title:_____________________________
By: Five-Star Marketing, Inc., in its capacity as
a joint venturer of aforesaid Joint Venture
By:______________________________
Title:_____________________________
<PAGE>
<TABLE>
<CAPTION>
Schedule A to
First Amended and Restated Working Capital Note
LOANS, CONVERSIONS AND REPAYMENTS OF ABR LOANS
======--------------------------------------------------------------------------------------------===================
<S> <C> <C> <C> <C> <C> <C>
Amount Amount Amount of Principal Amount of ABR Unpaid Principal
of ABR Converted of ABR Loans Loans Converted Balance of ABR Notation
Date Loans to ABR Loans Repaid to LIBOR Loans Loans Made By
======--------------------------------------------------------------------------------------------===================
======--------------------------------------------------------------------------------------------===================
======--------------------------------------------------------------------------------------------===================
======--------------------------------------------------------------------------------------------===================
======--------------------------------------------------------------------------------------------===================
======--------------------------------------------------------------------------------------------===================
======--------------------------------------------------------------------------------------------===================
======--------------------------------------------------------------------------------------------===================
======--------------------------------------------------------------------------------------------===================
======--------------------------------------------------------------------------------------------===================
======--------------------------------------------------------------------------------------------===================
=====================================================================================================================
=====================================================================================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Schedule B to
First Amended and
Restated Working
Capital Note
LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF
LIBOR LOANS
======-------------------------------------------------------------------------------------------------------==================
<S> <C> <C> <C> <C> <C> <C> <C>
Amount Interest Period Amount of LIBOR Unpaid
Converted to or and LIBOR Amount of Loans Converted Principal
Amount of continued as LIBOR Rate with Principal of to ABR Loans Balance of
LIBOR Loans Respect LIBOR LIBOR Loans Notation
Date Loans Thereto Loans Repaid Made By
======-------------------------------------------------------------------------------------------------------==================
======-------------------------------------------------------------------------------------------------------==================
======-------------------------------------------------------------------------------------------------------==================
======-------------------------------------------------------------------------------------------------------==================
======-------------------------------------------------------------------------------------------------------==================
======-------------------------------------------------------------------------------------------------------==================
======-------------------------------------------------------------------------------------------------------==================
======-------------------------------------------------------------------------------------------------------==================
======-------------------------------------------------------------------------------------------------------==================
======-------------------------------------------------------------------------------------------------------==================
======-------------------------------------------------------------------------------------------------------==================
===============================================================================================================================
===============================================================================================================================
</TABLE>
PABOS2:FSH:61990_2
EXHIBIT B
[FORM OF SWING LINE NOTE]
THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS AND
PROVISIONS OF THE LOAN AGREEMENT REFERRED TO BELOW. TRANSFERS OF THIS NOTE MUST
BE RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO
THE TERMS OF SUCH LOAN AGREEMENT.
SWING LINE NOTE
$5,000,000.00 [Closing Date]
FOR VALUE RECEIVED, the undersigned, Fine Host Corporation, a Delaware
corporation, and all of its Subsidiaries (collectively, the "Borrowers"), hereby
jointly and severally and unconditionally promise to pay to the order of
BankBoston, N.A. (the "Swing Line Bank") at its office, located at 100 Federal
Street, Boston, Massachusetts 02110, in lawful money of the United States of
America and in immediately available funds, on the Working Capital Maturity Date
the principal amount of Five Million and 00/100 Dollars ($5,000,000.00), or, if
less, the aggregate unpaid principal amount of all Swing Line Loans made by the
Swing Line Bank to the Borrower Agent pursuant to subsection 2.1.7 of the Loan
Agreement (as defined below). The Borrowers further agree to pay interest in
like money at such office on the unpaid principal amount of Swing Line Loans
made by the Swing Line Bank from time to time outstanding at the rates and on
the dates specified in subsection 3.4 of the Loan Agreement.
Reference is hereby made to that certain Fourth Amended and Restated
Loan Agreement, dated of even date herewith (as the same may be hereafter
further amended, modified, supplemented, extended or restated from time to time,
the "Loan Agreement") by and among the Borrowers, BankBoston, N.A. as
Administrative Agent, USTrust as Documentation Agent, the Swing Line Bank and
certain other banks and financial institutions which are or may hereafter be
parties thereto from time to time. All capitalized terms not defined herein but
defined in the Loan Agreement shall have the meanings given to such terms in the
Loan Agreement.
The Swing Line Bank is authorized to endorse the date and the amount of
each Swing Line Loan made by the Swing Line Bank to the Borrower pursuant to
subsection 2.1.7 of the Loan Agreement and the date and amount of each payment
or prepayment of principal thereof on Schedule A annexed hereto and made a part
hereof and any such recordation shall constitute prima facie evidence of the
accuracy of the information so endorsed; provided, however, that any failure by
the Swing Line Bank to make such endorsement shall not affect the obligation of
the Borrowers to repay the Swing Line Loans (with applicable interest) pursuant
to the Loan Agreement.
<PAGE>
This Note (a) is one of the Swing Line Notes referred to in the Loan
Agreement; (b) is subject to the provisions of the Loan Agreement and (c) is
subject to optional and mandatory prepayment in whole or in part as provided in
the Loan Agreement. This Note is secured as provided in the Loan Documents.
Reference is hereby made to the Loan Documents for a description of the
properties and assets in which a security interest has been granted, the nature
and extent of the security, the terms and conditions upon which the security
interests were granted and the rights of the holder of this Note in respect
thereof.
Upon the occurrence and during the continuance of any one or more of
the Events of Default, all amounts then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable, all as provided
in the Loan Agreement.
All parties now and hereafter liable with respect to this Note, whether
maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind.
All of the obligations and liabilities of the Borrowers (including
without limitation, the Joint Venture Subsidiary Borrowers) under this Note are
joint and several.
Notwithstanding any provision contained in this Note to the contrary,
the liabilities and obligations of the Joint Venture Subsidiary Borrowers under
this Note are limited to the extent provided in subsection 10.22 of the Loan
Agreement.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE COMMONWEALTH OF MASSACHUSETTS.
IN WITNESS WHEREOF, the undersigned have executed this Note under seal
as of the date first written above.
FINE HOST CORPORATION FINE HOST SERVICES CORPORATION
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST OF VERMONT, INC. FANFARE, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
<PAGE>
GLOBAL FANFARE, INC. FINE HOST INTERNATIONAL
CORPORATION
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
CREATIVE FOOD MANAGEMENT, NORTHWEST FOOD SERVICE, INC.
INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
TARRANT COUNTY CONCESSIONS, L.L.C. SUN WEST SERVICES, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
REPUBLIC MANAGEMENT CORP. VERSATILE HOLDING CORPORATION
OF MASSACHUSETTS
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
<PAGE>
SERV-RITE CORPORATION IDEAL MANAGEMENT SERVICES, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
SERVICE DYNAMICS CORP. PCS HOLDING CORP.
(f/k/a HCS Management Corp.)
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
<PAGE>
PCS MANAGEMENT CORP. HEARTSTRINGS GIFT SHOPS, INC.
(f/k/a N.C. PCSM, Inc.) (f/k/a Hospital Coffee Shoppes, Inc.)
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
THE ENVIRONMENTAL GROUP, INC. CREATIVE DATA SYSTEMS, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST/S. BROOKS & ASSOCIATES
JOINT VENTURE
By: Fine Host Corporation, in its capacity as a joint
venturer of aforesaid Joint Venture
By: ______________________________
Title: _____________________________
By: S. Brooks & Associates, Inc., in its capacity as a
joint venturer of aforesaid Joint Venture
By: ______________________________
Title: _____________________________
FINE HOST/R&N/A CUP ABOVE JOINT VENTURE
By: Fine Host Corporation, in its capacity as a joint
venturer of aforesaid Joint Venture
By: ________________________________
Title: ______________________________
By: ____________________________________
Tyrone W. Nabbie (together with Ronald O. Rogers, doing
business as R&N Management Services), in his capacity
as a joint venturer of aforesaid Joint Venture
By: ____________________________________
Ronald O. Rogers (together with Tyrone W. Nabbie, doing
business as R&N Management Services), in his capacity
as a joint venturer of aforesaid Joint Venture
By: __________________________________
Ellen Korbin (doing business as A Cup Above), in her
capacity as a joint venturer of aforesaid Joint Venture
WISCONSIN CENTER JOINT VENTURE
By: Fine Host Corporation, in its capacity
as a joint venturer of aforesaid Joint
Venture
By:______________________________
Title:_____________________________
By: Five-Star Marketing, Inc., in its capacity as
a joint venturer of aforesaid Joint Venture
By:______________________________
Title:_____________________________
<PAGE>
Schedule A
To Swing Line Note
LOANS AND REPAYMENTS
=====------------------------------------------------------------------------
Amount of Amount of Unpaid
Swing Line Loans Swing Line Loans Principal Balance Notation Made
Date Made Repaid of Swing By
Line Loans
=====------------------------------------------------------------------------
=====------------------------------------------------------------------------
=====------------------------------------------------------------------------
=====------------------------------------------------------------------------
=====------------------------------------------------------------------------
=====------------------------------------------------------------------------
=====------------------------------------------------------------------------
=====------------------------------------------------------------------------
=====------------------------------------------------------------------------
=====------------------------------------------------------------------------
=====------------------------------------------------------------------------
=====------------------------------------------------------------------------
=====------------------------------------------------------------------------
=============================================================================
=============================================================================
PABOS2:FSH:65195_2
EXHIBIT C
[FORM OF FIRST AMENDED AND RESTATED GUIDANCE NOTE]
THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS AND
PROVISIONS OF THE LOAN AGREEMENT REFERRED TO BELOW. TRANSFERS OF THIS NOTE MUST
BE RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO
THE TERMS OF SUCH LOAN AGREEMENT.
FIRST AMENDED AND RESTATED GUIDANCE NOTE
$_____________ [Closing Date]
FOR VALUE RECEIVED, the undersigned, Fine Host Corporation, a Delaware
corporation, and all of its Subsidiaries (collectively, the "Borrowers"), hereby
jointly and severally and unconditionally promise to pay to the order of
__________________________________ (the "Bank") at the office of BankBoston,
N.A., located at 100 Federal Street, Boston, Massachusetts 02110, in lawful
money of the United States of America and in immediately available funds, on the
Guidance Loan Maturity Date the principal amount of ________________________ and
00/100 Dollars ($______________________), or, if less, the aggregate unpaid
principal amount of all Guidance Loans made by the Bank to the Borrower Agent
pursuant to subsection 2.2 of the Loan Agreement (as defined below). The
principal amount of this Note shall be paid in the amounts and on the dates
specified in subsection 2.2.5 of the Loan Agreement. The Borrowers further agree
to pay interest in like money at such office on the unpaid principal amount of
Guidance Loans made by the Bank from time to time outstanding at the rates and
on the dates specified in subsection 3.4 of the Loan Agreement.
Reference is hereby made to that certain Fourth Amended and Restated
Loan Agreement, dated of even date herewith (as the same may be hereafter
further amended, modified, supplemented, extended or restated from time to time,
the "Loan Agreement") by and among the Borrowers, BankBoston, N.A. as
Administrative Agent, USTrust as Documentation Agent, the Bank and certain other
banks and financial institutions which are or may hereafter be parties thereto
from time to time. All capitalized terms not defined herein but defined in the
Loan Agreement shall have the meanings given to such terms in the Loan
Agreement.
The holder of this Note is authorized to endorse on the Schedules A and
B annexed hereto and made a part hereof or on a continuation thereof which shall
be attached hereto and made a part hereof the date, Type and amount of each
Guidance Loan made by the Bank and the date and amount of each payment or
prepayment of principal thereof, each conversion of all or a portion thereof to
another Type, each continuation of all or a portion thereof as the same Type
and, in the case of LIBOR Loans, the length of each Interest Period and the
LIBOR Rate with respect thereto. Each such endorsement shall constitute prima
facie evidence of the accuracy of the information endorsed; provided, however,
that the failure to make any such endorsement shall not affect the obligation of
the Borrowers to repay Guidance Loans (with applicable interest) pursuant to the
Loan Agreement.
This Note (a) is one of the Guidance Notes referred to in the Loan
Agreement; (b) is subject to the provisions of the Loan Agreement and (c) is
subject to optional and mandatory prepayment in whole or in part, and to
conversion, as provided in the Loan Agreement. This Note is secured as provided
in the Loan Documents. Reference is hereby made to the Loan Documents for a
description of the properties and assets in which a security interest has been
granted, the nature and extent of the security, the terms and conditions upon
which the security interests were granted and the rights of the holder of this
Note in respect thereof.
Upon the occurrence and during the continuance of any one or more of
the Events of Default, all amounts then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable, all as provided
in the Loan Agreement.
All parties now and hereafter liable with respect to this Note, whether
maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind.
All of the obligations and liabilities of the Borrowers (including
without limitation, the Joint Venture Subsidiary Borrowers) under this Note are
joint and several.
Notwithstanding any provision contained in this Note to the contrary,
the liabilities and obligations of the Joint Venture Subsidiary Borrowers under
this Note are limited to the extent provided in subsection 10.22 of the Loan
Agreement.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE COMMONWEALTH OF MASSACHUSETTS.
This Note and all of the other Guidance Notes referred to in the Loan
Agreement amend and restate in their entirety all of the Existing Guidance
Notes. Upon the execution and delivery by the Borrowers of this Note and all of
the other Guidance Notes, this Note and all of the other Guidance Notes shall
collectively replace in their entirety all of the Existing Guidance Notes and
shall immediately evidence all outstanding indebtedness under the Existing
Guidance Notes. The Borrowers hereby agree that the indebtedness embodied in and
evidenced by this Note and all of the other Guidance Notes is the same
indebtedness embodied in and evidenced by the Existing Guidance Notes, as
increased as provided in this Note and in the other Guidance Notes, and that
such indebtedness is a continuing obligation of the Borrowers, and has been and
continues to be fully enforceable, absolute and in existence.
IN WITNESS WHEREOF, the undersigned have executed this Note under seal
as of the date first written above.
FINE HOST CORPORATION FINE HOST SERVICES CORPORATION
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST OF VERMONT, INC. FANFARE, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
GLOBAL FANFARE, INC. FINE HOST INTERNATIONAL
CORPORATION
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
CREATIVE FOOD MANAGEMENT, NORTHWEST FOOD SERVICE, INC.
INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
TARRANT COUNTY CONCESSIONS, L.L.C. SUN WEST SERVICES, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
REPUBLIC MANAGEMENT CORP. VERSATILE HOLDING CORPORATION
OF MASSACHUSETTS
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
SERV-RITE CORPORATION IDEAL MANAGEMENT SERVICES, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
SERVICE DYNAMICS CORP. PCS HOLDING CORP.
(f/k/a HCS Management Corp.)
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
PCS MANAGEMENT CORP. HEARTSTRINGS GIFT SHOPS, INC.
(f/k/a N.C. PCSM, Inc.) (f/k/a Hospital Coffee Shoppes, Inc.)
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
THE ENVIRONMENTAL GROUP, INC. CREATIVE DATA SYSTEMS, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST/S. BROOKS & ASSOCIATES
JOINT VENTURE
By: Fine Host Corporation, in its capacity as a joint
venturer of aforesaid Joint Venture
By: ______________________________
Title: _____________________________
By: S. Brooks & Associates, Inc., in its capacity as a
joint venturer of aforesaid Joint Venture
By: ______________________________
Title: _____________________________
FINE HOST/R&N/A CUP ABOVE JOINT VENTURE
By: Fine Host Corporation, in its capacity as a joint
venturer of aforesaid Joint Venture
By: ________________________________
Title: ______________________________
By: ____________________________________
Tyrone W. Nabbie (together with Ronald O. Rogers, doing
business as R&N Management Services), in his capacity
as a joint venturer of aforesaid Joint Venture
By: ____________________________________
Ronald O. Rogers (together with Tyrone W. Nabbie, doing
business as R&N Management Services), in his capacity
as a joint venturer of aforesaid Joint Venture
By: __________________________________
Ellen Korbin (doing business as A Cup Above), in her
capacity as a joint venturer of aforesaid Joint Venture
<PAGE>
WISCONSIN CENTER JOINT VENTURE
By: Fine Host Corporation, in its capacity
as a joint venturer of aforesaid Joint
Venture
By:_____________________________
Title:___________________________
By: Five-Star Marketing, Inc., in its capacity as
a joint venturer of aforesaid Joint Venture
By:______________________________
Title:_____________________________
<PAGE>
Schedule A to
First Amended and Restated Guidance Note
LOANS, CONVERSIONS AND REPAYMENTS OF ABR LOANS
======------------------------------------------------------------------------
Amount of Amount of Unpaid
Amount Amount Principal ABR Loans Principal
of ABR Converted of ABR Loans Converted Balance of Notation
Date Loans to ABR Loans Repaid to LIBOR ABR Loans Made By
Loans
======------------------------------------------------------------------------
======------------------------------------------------------------------------
EXHIBIT D
FORM OF
SECOND AMENDED AND RESTATED SECURITY AGREEMENT
(for Fine Host Corporation)
This SECOND AMENDED AND RESTATED SECURITY AGREEMENT (the "Agreement")
is made as of July __, 1997, by and between (a) FINE HOST CORPORATION, a
Delaware corporation, with its principal place of business at 3 Greenwich Office
Park, Greenwich, Connecticut 06830 (together with its successors and assigns,
"Fine Host") and (b) BANKBOSTON, N.A., as Administrative Agent (in such
capacity, the "Administrative Agent") for various banks and other financial
institutions which are or may hereafter become parties (said banks and other
financial institutions are hereinafter referred to collectively as the "Banks")
to that certain Fourth Amended and Restated Loan Agreement, dated of even date
herewith (as the same may be hereafter further amended, modified, supplemented,
extended or restated, from time to time, the "Loan Agreement"), by and among
Fine Host, all of the Subsidiaries of Fine Host, the Administrative Agent,
USTrust as Documentation Agent for the Banks (in such capacity, the
"Documentation Agent")(the Administrative Agent and the Documentation Agent are
hereinafter sometimes referred to collectively as the "Agents") and the Banks.
All capitalized terms not defined herein but defined in the Loan
Agreement shall have the meanings given to such terms in the Loan Agreement, and
if not defined in the Loan Agreement, then the meanings given to such terms in
the Uniform Commercial Code, as in effect, from time to time, in The
Commonwealth of Massachusetts (the "UCC").
WITNESSETH:
WHEREAS, in connection with the Existing Loan Agreement, Fine Host
entered into, among other things, a certain First Amended and Restated Security
Agreement, dated as of June 25, 1996 (the "Existing Security Agreement"), by and
between Fine Host and USTrust, as Lender and Agent for the Existing Banks (in
such capacity, the "Original Agent"), pursuant to which, among other thing, Fine
Host granted to the Original Agent, for the ratable benefit of the Existing
Banks, a security interest in the assets of Fine Host, as more particularly
described therein and herein, to secure all of the obligations and liabilities
of Fine Host to the Existing Banks; and
WHEREAS, Fine Host and all of its Subsidiaries have requested that the
Existing Banks amend and restate in its entirety the Existing Loan Agreement in
the manner provided in the Loan Agreement; and
WHEREAS, the Agents and all of the Banks which are not Existing Banks
have agreed to become parties to the Loan Agreement; and
WHEREAS, it is a condition precedent to the effectiveness of the Loan
Agreement and to the obligations of the Banks to make Extensions of Credit
provided for therein that Fine Host shall have amended and restated in its
entirety the Existing Security Agreement in the manner provided herein.
NOW, THEREFORE, in consideration of the premises contained herein, and
to induce the Existing Banks to amend and restate the Existing Loan Agreement,
as provided in the Loan Agreement, and to induce the Banks to make Extensions of
Credit under the Loan Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Fine Host and the
Administrative Agent, for the ratable benefit of the Banks, hereby amend,
restate and replace the Existing Security Agreement to read in its entirety as
follows:
<PAGE>
Article I. Grant of Security Interest.
1.1 To secure the prompt, punctual, and faithful performance by Fine
Host of all of its Liabilities, Fine Host hereby grants to the Administrative
Agent, for the ratable benefit of the Banks, a continuing security interest in
and to, and assigns to the Administrative Agent, for the ratable benefit of the
Banks, all of the rights, title and interests of Fine Host in and to, the
following, and each item thereof, whether now owned or now due, or in which Fine
Host has an interest, or hereafter at any time in the future, acquired, arising,
or to become due, or in which Fine Host obtains an interest, and all products,
proceeds, substitutions, and accessions of or to any of the following (all of
which, together with any other property in which the Administrative Agent may in
the future be granted a security interest pursuant hereto, is referred to
hereinafter as the "Collateral"): (a) All Accounts and Accounts Receivable; (b)
All Inventory; (c) All Contract Rights; (d) All General Intangibles; (e) All
Equipment; (f) All Farm Products; (g) All Goods; (h) All Chattel Paper, Note
Receivables and Receivables (including but not limited to, all license
agreements, all management agreements, all concession agreements and all food
service operation agreements and all Facilities Agreements); (i) All Fixtures;
(j) All books, records, and information relating to the Collateral and/or to the
operation of Fine Host's business, and all rights of access to such books,
records, and information, and all property in which such books, records, and
information are stored, recorded, and maintained, subject, in the case of rights
of access to premises not owned by Fine Host, to rights of third parties; (k)
All Instruments, Documents of Title, Documents, policies and certificates of
insurance, Securities, deposits, deposit accounts, money, cash, or other
property; (l) All federal, state, and local tax refunds and/or abatements to
which Fine Host is, or becomes entitled, no matter how or when arising,
including, but not limited to any loss carryback tax refunds; (m) All insurance
proceeds, refunds, and premium rebates, including, without limitation, proceeds
of fire and credit insurance, whether any of such proceeds, refunds, and premium
rebates, arise out of the foregoing (a through l), or otherwise; (n) All liens,
guaranties, rights, remedies, and privileges pertaining to any of the foregoing
(a through m) including the right of stoppage in transit; and (o) All licenses
and permits (including but not limited to, all liquor licenses).
1.2 The foregoing grant of a security interest is in addition to, and
supplemental of, any security interest previously granted by Fine Host to either
the Administrative Agent or to the Original Agent and shall continue in full
force and effect applicable to all Liabilities and to any future advances made
by the Administrative Agent or any of the Banks to or on behalf of Fine Host
until this Agreement is specifically terminated in writing by a duly authorized
officer of the Administrative Agent.
Article II. Definitions.
As herein used, the following terms have the following meanings:
2.1 "Accounts" and "Accounts Receivable" means "accounts," as defined
in the UCC, together with all accounts, accounts receivable, notes, drafts,
acceptances, and other forms of obligations and receivables and rights to
payment for credit extended and for goods sold or leased, or services rendered,
whether or not yet earned by performance; all Inventory which gave rise thereto,
and all rights associated with such Inventory, including the right of stoppage
in transit and all reclaimed, returned, rejected or repossessed Inventory (if
any) the sale of which gave rise to any Account.
2.2 "Contract Rights" means "contract rights," as defined in the UCC,
together with any right to payment under a contract not yet earned by
performance and not evidenced by an instrument or Chattel Paper.
2.3 "Costs of Collection" means and includes all fees, costs and
expenses (including without limitation, all reasonable legal fees, costs and
expenses, and reasonable costs and expenses associated with travel) incurred by
the Agents in connection with the administration of this Agreement and all of
the other Loan Documents. Costs of Collection also means and includes all fees,
costs and expenses (including without limitation, all reasonable legal fees,
costs and expenses, and reasonable costs and expenses associated with travel)
incurred by the Agents and the Banks in connection with preserving, protecting,
collecting, or enforcing the Collateral, the Liabilities and/or the
Administrative Agent's Rights and Remedies or any of the rights and remedies of
the Agents or the Banks against or in respect of any guarantor or other person
liable in respect of the Liabilities (whether or not suit is instituted in
connection with such efforts). The Costs of Collection shall be added to the
Liabilities of Fine Host to the Agents and the Banks, as if such had been lent,
advanced, and credited by the Agents and the Banks to, or for the benefit of,
Fine Host.
2.4 "Equipment" means "equipment," as defined in the UCC, together with
all motor vehicles, rolling stock, machinery, office equipment, plant equipment,
tools, dies, molds, store fixtures, furniture, and other goods, property, and
assets which are used and/or were purchased for use in the operation or
furtherance of Fine Host's business.
2.5 "General Intangibles" means "general intangibles," as defined in
the UCC, together with all: rights to payment for credit extended; deposits;
amounts due to Fine Host; credit memoranda in favor of Fine Host; warranty
claims; all means and vehicles of investment or hedging, including, without
limitation, options, warrants, and futures contracts; records; customer lists;
goodwill; causes of action; judgments; payments under any settlement or other
agreement; literary rights; rights to performance; royalties; license fees;
franchise fees; rights of admission; licenses; franchises; permits; certificates
of convenience and necessity, and similar rights granted by any governmental
authority; copyrights; trademarks, trade names, service marks, patents, patent
applications, patents pending, and other intellectual property; developmental
ideas and concepts; proprietary processes; blueprints; drawings; designs;
diagrams; plans; reports; charts; catalogs; manuals; technical data; computer
programs, computer records, computer software, rights of access to computer
record service bureaus, service bureau computer contracts, and computer data;
proposals; costs estimates, and other reproductions on paper, or otherwise, of
any and all concepts or ideas, and any matter related to, or connected with, the
design, development, manufacture, sale, marketing, leasing, or use of any or all
property produced, sold, or leased, by Fine Host or credit extended or services
performed, by Fine Host, whether intended for an individual customer or the
general business of Fine Host, or used or useful in connection with research by
Fine Host.
2.6 "Inventory" means "inventory" as defined in the UCC, together with
all goods, wares, merchandise, raw materials, work in process, finished goods,
and all packaging, advertising, shipping material, and documents related to any
of the foregoing, and all labels, and other devices, names, or marks affixed or
to be affixed thereto for identifying or selling the same, and other personal
property of every description held for sale or lease or furnished or to be
furnished under a contract or contracts of sale or service by Fine Host, or used
or consumed or to be used or consumed in Fine Host's business, and all goods of
said description which are in transit, and all returned, repossessed and
rejected goods of said description, and all such goods of said description which
are detained from or rejected for entry into the United States, and all
documents (whether or not negotiable) which represent any of the foregoing.
2.7 "Liabilities" has the meaning given to that term in the
Loan Agreement.
2.8 "Obligations" means the obligations, covenants, representations and
warranties of the Borrowers (including without limitation, Fine Host) to any or
all of the Banks, and the Agents under the Loan Documents.
2.9 "Proceeds" means "proceeds," as defined in the UCC, together with
insurance proceeds, and each type of property described in Sections 1-1(a)
through and including 1-1(o) above.
2.10 "Receivables Collateral" refers to that portion of the Collateral
which consists of Fine Host's Accounts, Accounts Receivable, Contract Rights,
General Intangibles, Chattel Paper, Instruments, Documents of Title, Documents,
Securities, letters of credit and bankers' acceptances, and any rights to
payment now held or in which Fine Host has an interest, or hereafter acquired,
or in which Fine Host obtains an interest.
Article III. Representations, Warranties and Covenants.
3.1 Fine Host shall pay when due (or on demand if so payable) the
Liabilities and promptly, punctually, and faithfully shall perform the
Obligations.
3.2 Fine Host presently is and shall hereafter remain in good standing
as a corporation in that State indicated in the preamble of this Agreement and
is and shall hereafter remain duly qualified and in good standing in every other
State in which, by reason of the nature or location of Fine Host's assets or
operation of Fine Host's business, such qualification may be necessary, except
those States in which the failure to qualify and remain in good standing would
not have a Material Adverse Effect. The execution and delivery of this Agreement
and of any other instruments or documents executed in connection herewith
constitute representations by Fine Host that such execution and delivery have
received all corporate authorization as may be necessary to permit such
execution and delivery to, and that they do, bind Fine Host.
3.3 Exhibit A attached hereto and incorporated herein by
reference constitutes a listing of:
(i) all trade names and trade styles under which Fine Host presently
conducts or ever conducted its business; and
(ii) all legal names and legal statuses (such as a corporation or
partnership) under which Fine Host conducts or ever conducted business.
3.4 Fine Host is, and shall hereafter remain, the owner of the
Collateral free and clear of all liens, encumbrances, attachments, security
interests, purchase money security interests, mortgages, and charges with the
exceptions of (a) the security interest created herein, and (b) the security
interests and other encumbrances (if any) listed on Exhibit B attached hereto
and incorporated herein by reference or as otherwise permitted in the Loan
Agreement. Fine Host does not presently, and shall not hereafter have possession
of any property on consignment. Fine Host shall timely pay all of Fine Host's
encumbrances which are secured by security interests which may be superior to
that granted the Administrative Agent herein.
3.5 Fine Host's principal place of business, chief executive office and
mailing address is set forth at the beginning of this Agreement; set forth on
Exhibit C are the locations of all Borrower's other places of business or at
which the Collateral may be kept or located. Except to accomplish sales of
Inventory in the ordinary course of business and to utilize such of the
Collateral as is removed from such locations in the ordinary course of business
(such as motor vehicles), the Collateral will be kept at all times at Fine
Host's principal place of business and chief executive office as set forth at
the beginning of this Agreement or at the locations of Fine Host's other places
of business as set forth on Exhibit C. All the information contained in the
Exhibits to this Agreement is true, accurate and complete, and Fine Host hereby
agrees to furnish the Administrative Agent written notice within ten (10) days
of any changes therein, or any additional information necessary to insure that
the information contained in the Exhibits remains true, accurate and complete.
3.6 Fine Host shall provide the Administrative Agent with such
information concerning Fine Host, the Collateral, the operation of Fine Host's
business, and Fine Host's financial condition as the Administrative Agent may
reasonably request from time to time. All financial information so provided the
Administrative Agent by Fine Host shall be prepared in accordance with generally
accepted accounting principles applied consistently in the preparation thereof
and with prior periods and shall fairly reflect the matters described therein.
3.7 All covenants, representations, and warranties made by Fine Host
pursuant to the terms of the Loan Agreement are hereby incorporated herein by
reference, and all provisions of the Loan Agreement granting the Administrative
Agent rights, privileges, or remedies are likewise also incorporated herein by
reference.
3.8 Fine Host shall not sell, offer to sell, lease, or otherwise
transfer or dispose of the Collateral or any part thereof or any interest
therein, except as permitted under the Loan Agreement.
3.9 Fine Host shall execute and deliver to the Administrative Agent
such instruments and shall do all such things from time to time hereafter as the
Administrative Agent may reasonably request to carry into effect the provisions
and intent of this Agreement, to protect and perfect the Administrative Agent's
security interest in and to the Collateral, and to comply with all applicable
statutes and laws, and to facilitate the collection and/or enforcement of
Receivables Collateral. Contemporaneous with the execution of this Agreement,
Fine Host shall execute all such instruments as may be reasonably required by
the Administrative Agent with respect to the perfection of the security
interests granted herein, including without limitation, financing statements in
such form and to be filed in accordance with the provisions of the Uniform
Commercial Code in such State or States as the Administrative Agent may
determine, and applications for notations of the Administrative Agent as lien
holder, mortgagee, or the like, on such certificates or similar instruments as
may have been issued with respect to Fine Host's ownership of one or more items
of the Collateral. A carbon, photographic, or other reproduction of this
Agreement or of any financing statement or other instrument executed pursuant to
this Section shall be sufficient for filing to perfect the security interests
granted herein.
3.10 Fine Host shall (a) keep the Collateral in good order and repair;
(b) not waste or destroy or suffer the waste or destruction of the Collateral of
any part thereof; and (c) not use any of the Collateral in violation of any
policy of insurance thereon.
3.11 Fine Host shall not indirectly do or cause to be done any act
which, if done directly by Fine Host, would breach any covenant contained herein
or in any other agreement between Fine Host and the Administrative Agent.
3.12 The representations, covenants, and warranties contained herein
are in addition to any others, previously, presently, or hereafter made by Fine
Host to or with the Administrative Agent in any other instrument.
Article IV. Collection of Accounts, Accounts Receivable, Contract Rights
and Other Collateral.
4.1 At any time after one or more Events of Default has occurred:
(a) The Administrative Agent may notify any of Fine Host's
account or contract debtors, either in the name of the Administrative
Agent or Fine Host, to make payment directly to the Administrative
Agent or such other address as may be specified by the Administrative
Agent, and may advise any person of the Administrative Agent's security
interest in and to the Collateral, and may collect directly from the
obligors thereon, all amounts due on account of the Collateral; and
(b) At the Administrative Agent's request, Fine Host will
provide written notifications to any or all of Fine Host's account or
contract debtors concerning the Administrative Agent's security
interest in the Collateral and will request that such account or
contract debtors forward payment thereof directly to the Administrative
Agent.
4.2 At any time after one or more Events of Default has occurred, and
after notification to Fine Host from the Administrative Agent, Fine Host:
(a) shall hold any proceeds and collections of any of the
Collateral in trust for the Administrative Agent, and shall not
commingle such proceeds or collections with any other funds of Fine
Host; and
(b) shall deliver each of the following duly endorsed,
assigned or otherwise made payable to the Administrative Agent; (i) all
such proceeds to the Administrative Agent immediately upon the receipt
thereof by Fine Host in the identical form received, and (ii) all
security or collateral for, guaranties of, letters of credit, trade and
bankers' acceptances, and similar letters and instruments in respect of
any of the Collateral.
4.3 Fine Host hereby irrevocably constitutes and appoints the
Administrative Agent as Fine Host's true and lawful attorney, upon the
occurrence of an Event of Default, with full power of substitution, to convert
the Collateral into cash at the sole risk, cost, and expense of Fine Host, but
for the sole benefit of the Administrative Agent. The rights and powers granted
the Administrative Agent by the within appointment include but are not limited
to the right and power to:
(a) prosecute, defend, compromise, or release any action
relating to the Collateral;
(b) sign change of address forms to change the address to
which Fine Host's mail is to be sent as the Administrative Agent shall
designate; receive and open Fine Host's mail; remove any Collateral
therefrom and turn over such mail (other than such Collateral), either
to Fine Host, or to any trustee in bankruptcy, receiver, assignee for
the benefit of creditors of Fine Host, or other legal representative of
Fine Host whom the Administrative Agent determines to be the
appropriate person to whom to so turn over such mail;
(c) endorse the name of Fine Host in favor of the
Administrative Agent upon any and all checks, drafts, notes,
acceptances, or other items or instruments; sign and endorse the name
of Fine Host on, and receive as secured party, any of the Collateral,
any invoices, schedules of Collateral, freight or express receipts, or
bills of lading, storage receipts, warehouse receipts, or other
documents of title of a same or different nature relating to the
Collateral;
(d) sign the name of Fine Host on any notice to Fine Host's
Account Debtors or verification of the Receivables Collateral; sign
Fine Host's name on any proof of claim in bankruptcy against Account
Debtors, notices of lien, claims of mechanics liens, or assignments or
releases of mechanics' lien securing the Accounts;
(e) take all such action as may be necessary to obtain
the payment of any letter of credit of which Fine
Host is a beneficiary;
(f) repair, manufacture, assemble, complete, package, deliver,
alter or supply goods, if any, necessary to fulfill in whole or in part
the purchase order of any customer of Fine Host;
(g) use, license, or transfer any or all General
Intangibles of Fine Host; or
(h) sign and file or record any financing or other statement
in order to perfect or protect the Administrative Agent's security
interest in the Collateral.
4.4 In connection with all powers of attorney included in this
Agreement, Fine Host hereby grants unto the Administrative Agent full power to
do any and all things necessary or appropriate, in connection with the exercise
of such powers as fully and effectually as Fine Host might or could do, and
hereby ratifying all that said attorney shall do or cause to be done by virtue
of this Agreement.
4.5 The Administrative Agent shall not be obligated to do any of the
acts or to exercise any of the powers authorized herein, but if the
Administrative Agent elects to do any such act or to exercise any such powers,
it shall not be accountable for more than it actually receives as a result of
such exercise of power, and shall not be responsible to Fine Host except for the
Administrative Agent's actual willful misconduct and bad faith.
4.6 All powers conferred upon the Administrative Agent by this
Agreement, being coupled with an interest, shall be irrevocable until this
Agreement is terminated by a written instrument executed by a duly authorized
officer of the Administrative Agent or until all Liabilities are paid in full.
Article V. Events of Default.
Upon the occurrence of any one or more Events of Default, any and all
Liabilities of Fine Host shall become immediately due and payable, as provided
in the Loan Agreement. The occurrence of any such Event of Default shall also
constitute, without notice or demand, a default under all other agreements
between the Administrative Agent and Fine Host and instruments, documents, and
papers given to the Administrative Agent by Fine Host, whether such agreements,
instruments, or papers now exist or hereafter arise.
Article VI. Rights And Remedies Upon Default.
In addition to all of the rights, remedies, powers, privileges, and
discretions which the Administrative Agent is provided prior to the occurrence
of an Event of Default, the Administrative Agent shall have the following Rights
and Remedies ("Rights and Remedies") upon the occurrence of any Event of
Default.
6.1 Upon the occurrence of any Event of Default, and at any time
thereafter, the Administrative Agent shall have all of the Rights and Remedies
of a secured party upon default under the UCC, in addition to which the
Administrative Agent shall have all of the following Rights and Remedies:
(a) To collect the Receivables Collateral with or without
the taking of possession of any of the Collateral
and/or
(b) To take possession of all or any portion of the
Collateral; and/or
(c) To sell, lease, or otherwise dispose of any or all of the
Collateral, in its then condition or following such preparation or
processing as the Administrative Agent deems advisable and with or
without the taking of possession of any of the Collateral; and/or
(d) To apply the Receivables Collateral or the proceeds
of the Collateral towards (but not
necessarily in complete satisfaction of) the
Liabilities.
6.2 Any sale or other disposition of the Collateral may be at public or
private sale upon such terms and in such manner as the Administrative Agent
deems advisable, having due regard to compliance with any statute or regulation
which might affect, limit, or apply to the Administrative Agent's disposition of
the Collateral. The Administrative Agent may conduct any such sale or other
disposition of the Collateral upon Fine Host's premises. Unless the Collateral
is perishable or threatens to decline speedily in value, or is of a type
customarily sold on a recognized market (in which event the Administrative Agent
shall provide Fine Host with such notice as may be practicable under the
circumstances), the Administrative Agent shall give Fine Host at least the
greater of the minimum notice required by law or seven (7) days prior written
notice of the date, time, and place of any proposed public sale, and of the date
after which any private sale or other disposition of the Collateral may be made.
The Administrative Agent may purchase the Collateral, or any portion of it at
any sale held under this Article.
6.3 In connection with the Administrative Agent's exercise of the
Administrative Agent's rights under this Article, the Administrative Agent may
enter upon, occupy, and use any premises owned or occupied by Fine Host, and may
exclude Fine Host from such premises or portion thereof as may have been so
entered upon, occupied, or used by the Administrative Agent, subject in any such
case to the requirements of applicable law and to the rights of third parties.
The Administrative Agent shall not be required to remove any of the Collateral
from any such premises upon the Administrative Agent's taking possession
thereof, and may render any Collateral unusable to Fine Host. In no event shall
the Administrative Agent be liable to Fine Host for use of occupancy by the
Administrative Agent of any premises pursuant to this Article, nor for any
charge (such as wages for Fine Host's employees and utilities) incurred in
connection with the Administrative Agent's exercise of the Administrative
Agent's Rights and Remedies.
6.4 Fine Host hereby grants to the Administrative Agent a nonexclusive
irrevocable license to use, apply, and affix any trademark, tradename, logo, or
the like in which Fine Host now or hereafter has rights, such license being with
respect to the Administrative Agent's exercise of the rights hereunder
including, without limitation, in connection with any completion of the
manufacture of Inventory or sale or other disposition of Inventory.
6.5 Upon the occurrence of any Event of Default, the Administrative
Agent may require Fine Host to assemble the Collateral and make it available to
the Administrative Agent at Fine Host's sole risk and expense at a place or
places which are reasonably convenient to both the Administrative Agent and Fine
Host.
6.6 The rights, remedies, powers, privileges, and discretions of the
Administrative Agent hereunder (the "Administrative Agent's Rights and
Remedies") shall be cumulative and not exclusive of any rights or remedies which
it would otherwise have. No delay or omission by the Administrative Agent in
exercising or enforcing any of the Administrative Agent's Right and Remedies
shall operate as, or constitute, a waiver thereof. No waiver by the
Administrative Agent of any Event of Default or of any default under any other
agreement shall operate as a waiver of any other default hereunder or under any
other agreement. No single or partial exercise of any of the Administrative
Agent's Rights or Remedies, and no other agreement shall operate as a waiver of
any other default hereunder or under any other agreement or transaction, of
whatever nature entered into between the Administrative Agent and Fine Host at
any time, either express or implied, shall preclude any other or further
exercise of the Administrative Agent's Rights and Remedies. No waiver by the
Administrative Agent of any of the Administrative Agent's Rights and Remedies on
any one occasion shall be deemed a waiver on any subsequent occasion, nor shall
it be deemed a continuing waiver. All of the Administrative Agent's Right and
Remedies may be exercised by the Administrative Agent at such time or times and
in such order of preference as the Administrative Agent in its sole discretion
may determine.
Article VII. General.
7.1 Any and all deposits or other sums at any time credited by or due
to Fine Host from the Administrative Agent or any Bank or lending affiliates or
any bank acting as a participant under any loan arrangement between the
Administrative Agent and Fine Host, and any cash, securities, instruments, or
other property of Fine Host in the possession of the Administrative Agent, or
any Bank or any of its banking or lending affiliates, and any bank acting as a
participant under any loan arrangement between the Administrative Agent and Fine
Host, whether for safekeeping, or otherwise, or in transit to or from the
Administrative Agent or any Bank or any of its banking or lending affiliates or
any such participant, or in the possession of any third party acting on the
Administrative Agent's or any Bank's behalf (regardless of the reason the
Administrative Agent or any Bank had received same or whether the Administrative
Agent or any Bank has conditionally released the same) shall at all times
constitute security for any and all Liabilities, and may be applied or set off
against such Liabilities at any time after an Event of Default.
7.2 (a) Except as specifically required by this Agreement, Fine Host
WAIVES notice of non-payment, demand, presentment, protest, and all forms of
demand and notice, both with respect to the Liabilities and the Collateral.
(b) Fine Host, if entitled to it, WAIVES the right to notice
and/or hearing prior to the exercise of the Administrative Agent's
rights upon default.
7.3 The Administrative Agent shall have no duty as to the collection or
protection of the Collateral beyond the safe custody of such of the Collateral
as may come in possession of the Administrative Agent and shall have no duty as
to the preservation of rights against prior parties or any other rights
pertaining thereto. The Administrative Agent's Rights and Remedies may be
exercised without resort or regard to any other source of satisfaction of the
Liabilities.
7.4 All notices, requests and other communications hereunder shall be
given in the manner provided for in the Loan Agreement.
7.5 This Agreement shall be binding upon Fine Host and Fine Host's
successors, and assigns and shall inure to the benefit of the Administrative
Agent and the Administrative Agent's successors and assigns. In the event that
the Administrative Agent assigns or transfers its rights under this Agreement,
the assignee shall thereupon succeed to and become vested with all rights,
powers, privileges, and duties of the Administrative Agent hereunder and the
Administrative Agent shall thereupon be discharged and relieved from its duties
and obligations hereunder.
7.6 Any determination that any provision of this Agreement or any
application thereof is invalid, illegal, or unenforceable in any respect in any
instance shall not affect the validity, legality, and enforceability of such
provision in any other instance, or the validity, legality, or enforceability of
any other provision of this Agreement.
7.7 This Agreement and all other instruments executed in connection
herewith incorporate all discussions and negotiations between Fine Host and the
Administrative Agent, either express or implied, concerning the matters included
herein and in such other instruments, any custom or usage to the contrary
notwithstanding. No such discussions or negotiations shall limit, modify, or
otherwise affect the provisions hereof. No modification, amendment, or waiver of
any provision of this Agreement or of any provision of any other agreement
between Fine Host and the Administrative Agent is effective unless executed in
writing by the party to be charged with such modification, amendment and waiver,
and if such party be the Administrative Agent, then by a duly authorized officer
thereof.
7.8 The proceeds of any collection, sale, or disposition of the
Collateral, or of any other payments received hereunder, shall be applied toward
the Liabilities in such order and manner as the Administrative Agent determines
in its sole discretion, any statute, custom, or usage to the contrary
notwithstanding. Fine Host shall remain liable to the Administrative Agent for
any deficiency remaining following such application.
7.9 Fine Host shall pay on demand all Costs of Collection and all
expenses of the Administrative Agent in connection with the preparation,
execution, and delivery of this Agreement and of any other documents and
agreements between Fine Host and the Administrative Agent, whether now existing
or hereafter arising, and all other expenses which may be incurred by the
Administrative Agent in preparing or amending this Agreement and all other
agreements, instruments, and documents related thereto, or otherwise with
respect to the Liabilities. Fine Host authorizes the Administrative Agent to pay
all such expenses and to charge the same to any account of Fine Host with the
Administrative Agent.
7.10 All amounts which the Administrative Agent may advance under this
Agreement shall be included in the Liabilities, shall be repayable to the
Administrative Agent with interest at the highest pre-default rate charged Fine
Host by the Administrative Agent under the Loan Agreement, on demand (and if not
paid within five (5) days of notice to Borrower, at the default rate set forth
in subsection 3.4(c) of the Loan Agreement, and may be charged by the
Administrative Agent to any account which Fine Host maintains with the
Administrative Agent.
7.11 This Agreement and all other instruments, documents, and papers
which relate thereto which have been or may be hereinafter furnished the
Administrative Agent may be reproduced by the Administrative Agent by any
photographic, photostatic, microfilm, micro-card, miniature photographic,
xerographic, or similar process, and the Administrative Agent may destroy the
original from which any document was so reproduced. Any such reproduction shall
be admissible in evidence as the original itself in any judicial or
administrative proceeding (whether or not the original is in existence and
whether or not such reproduction was made in the regular course of business).
7.12 This Agreement and all rights and obligations hereunder, including
matters of construction, validity and performance, shall be governed by the laws
of The Commonwealth of Massachusetts. Fine Host submits itself to the
jurisdiction of the Courts of said Commonwealth for all purposes with respect to
this Agreement and Fine Host's relationship with the Administrative Agent.
7.13 Fine Host shall indemnify, defend, and hold each of the Agents and
the Banks harmless of and from any claim brought or threatened against any of
the Agents or the Banks by Fine Host, any guarantor or endorser of the
Liabilities, or any other person (as well as from attorneys' reasonable fees and
expenses in connection therewith) on account of the relationship of any of the
Agents or the Banks with Fine Host or any other guarantor or endorser of the
Liabilities (each of which may be defended, compromised, settled, or pursued by
the Administrative Agent, for the benefit of the Banks and the Documentation
Agent, with counsel of the Administrative Agent's selection, but at the expense
of Fine Host). Notwithstanding any other provision of this Agreement, the
indemnification contained herein shall survive payment of the Liabilities and/or
any termination, release, or discharge executed by any of the Agents or the
Banks in favor of Fine Host.
7.14 This Agreement shall remain in full force and effect until
specifically terminated in writing by a duly authorized officer of the
Administrative Agent, or (subject to Section 7.13) until all Liabilities are
paid in full.
7.15 The failure by Fine Host to perform all and singular Fine Host's
obligations hereunder will result in irreparable harm to the Administrative
Agent for which the Administrative Agent will have no adequate remedy at law.
Consequently, such obligations are specifically enforceable by the
Administrative Agent.
7.16 It is intended that:
(a) this Agreement take effect as a sealed instrument;
(b) the security interests created by this Agreement attach to
all of Fine Host's assets now owned or hereafter acquired which are
capable of being subject to a security interest;
(c) the security interests created by this agreement secure all Liabilities
of Fine Host to the Administrative Agent, whether now existing or hereafter
arising;
(d) all costs and expenses incurred by the Administrative
Agent in connection with the Administrative Agent's relationship(s)
with Fine Host shall be borne by Fine Host;
(e) the Administrative Agent's consent to any action of Fine
Host which is prohibited unless such consent is given may be given or
refused by the Administrative Agent in its sole discretion; and
(f) the Administrative Agent's Rights and Remedies provided herein are
subject to requirements of applicable law.
7.17 Fine Host acknowledges having received a copy of this Agreement.
7.18 Any provision contained herein to the contrary notwithstanding:
(i) subject to the subsection (iii) below, the Collateral
hereunder shall not include any contract, agreement or instrument to
the extent that the assignment contemplated hereunder would require the
consent or approval of any third party, or would adversely affect the
enforceability of any such contract, agreement or instrument or the
requirement that Fine Host be paid, repaid or reimbursed in the event
of termination of such contract, agreement or instrument or would
constitute a breach or default under any such contract, agreement or
instrument, unless and until such consent or approval has been
obtained;
(ii) subject to subsection (iii) below, the Collateral
hereunder shall not include any liquor license or any other license the
assignment of which would require the consent or approval of any
governmental authority or agency or other third party unless and until
such consent or approval has been obtained; and
(iii) unless an Event of Default has occurred and the
Liabilities of Fine Host have been accelerated pursuant to Section 8.2
of the Loan Agreement, Fine Host shall not be required to obtain or
seek to obtain any consent or approval referred to above.
To the extent that any of the Collateral is further assigned to the
Administrative Agent pursuant to a collateral assignment or other instrument
delivered by Fine Host to the Administrative Agent, then in the event of any
inconsistency with respect to matters relating to such Collateral between the
provisions of such assignment or instrument and the provisions of this
Agreement, the provisions of such Assignment or instrument shall control.
[THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK]
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this Agreement under
seal as of the date first written above.
WITNESS: FINE HOST CORPORATION
By:
Name Name:
Title:
Its duly authorized officer
WITNESS: BANKBOSTON, N.A., AS
ADMINISTRATIVE AGENT
By:
Name Name:
Title:
Its duly authorized officer
<PAGE>
EXHIBIT A
Trade Names: legal status; etc. ('3-3)
<PAGE>
EXHIBIT B
Other Encumbrances and Liens ('3-4)
<PAGE>
EXHIBIT C
Locations ('3-5)
PABOS2:FSH:64756_3
EXHIBIT E
FORM OF
[SECOND] AMENDED AND RESTATED SECURITY AGREEMENT
(for [Name of Joint Venture Subsidiary Borrower])
This [SECOND] AMENDED AND RESTATED SECURITY AGREEMENT (the "Agreement")
is made as of July __, 1997, by and between (a)
________________________________, a joint venture (together with its successors
and assigns, the "Joint Venture Subsidiary Borrower") which is organized
pursuant to a certain Joint Venture Agreement, dated _________ , by and among
(i) Fine Host Corporation, a Delaware corporation (together with its successors
and assigns, "Fine Host"), (ii) _______________________________ and (iii)
___________________________, as subsequently amended from time to time (as so
amended, the "Joint Venture Agreement") and whose principal place of business is
at _________________________________________ and (b) BANKBOSTON, N.A., as
Administrative Agent (in such capacity, the "Administrative Agent") for various
banks and other financial institutions which are or may hereafter become parties
(said banks and other financial institutions are hereinafter referred to
collectively as the "Banks") to that certain Fourth Amended and Restated Loan
Agreement, dated of even date herewith (as the same may be hereafter further
amended, modified, supplemented, extended or restated, from time to time, the
"Loan Agreement") by and among Fine Host, all of the Subsidiaries of Fine Host
(including without limitation, the Joint Venture Subsidiary Borrower), the
Administrative Agent, USTrust as Documentation Agent for the Banks (in such
capacity, the "Documentation Agent")(the Administrative Agent and the
Documentation Agent are hereinafter sometimes referred to collectively as the
"Agents") and the Banks.
All capitalized terms not defined herein but defined in the Loan
Agreement shall have the meanings given to such terms in the Loan Agreement, and
if not defined in the Loan Agreement, then the meanings given to such terms in
the Uniform Commercial Code, as in effect, from time to time, in The
Commonwealth of Massachusetts (the "UCC").
WITNESSETH:
WHEREAS, in connection with the Existing Loan Agreement, the Joint
Venture Subsidiary Borrower entered into, among other things, a certain [First
Amended and Restated] Security Agreement, dated as of ___________, 199_ (the
"Existing Security Agreement") by and between the Joint Venture Subsidiary
Borrower and USTrust as Lender and Agent for the Existing Banks (in such
capacity, the "Original Agent"), pursuant to which, among other things, the
Joint Venture Subsidiary Borrower granted to the Original Agent, for the ratable
benefit of the Existing Banks, a security interest in the assets of the Joint
Venture Subsidiary Borrower, as more particularly described therein and herein,
to secure all of the obligations and liabilities of the Joint Venture Subsidiary
Borrower to the Existing Banks; and
WHEREAS, Fine Host and all of its Subsidiaries (including without
limitation, the Joint Venture Subsidiary Borrower) have requested that the
Existing Banks amend and restate in its entirety the Existing Loan Agreement in
the manner provided in the Loan Agreement; and
WHEREAS, the Agents and all of the Banks which are not Existing Banks
have agreed to become parties to the Loan Agreement; and
WHEREAS, it is a condition precedent to the effectiveness of the Loan
Agreement and to the obligations of the Banks to make Extensions of Credit
provided for therein that the Joint Venture Subsidiary Borrower shall have
amended and restated in its entirety the Existing Security Agreement in the
manner provided herein;
NOW, THEREFORE, in consideration of the premises contained herein, and
to induce the Banks to amend and restate the Existing Loan Agreement, as
provided in the Loan Agreement, and to induce the Banks to make Extensions of
Credit under the Loan Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Joint Venture
Subsidiary Borrower and the Administrative Agent, for the ratable benefit of the
Banks, hereby amend, restate and replace the Existing Security Agreement to read
in its entirety as follows:
Article I. Grant of Security Interest.
1.1 To secure the prompt, punctual, and faithful performance by the
Joint Venture Subsidiary Borrower of all of the Liabilities, the Joint Venture
Subsidiary Borrower hereby grants to the Administrative Agent, for the ratable
benefit of the Banks, a continuing security interest in and to, and assigns to
the Administrative Agent, for the ratable benefit of the Banks, all of the
rights, title and interests of the Joint Venture Subsidiary Borrower in and to,
the following, and each item thereof, whether now owned or now due, or in which
the Joint Venture Subsidiary Borrower has an interest, or hereafter at any time
in the future, acquired, arising, or to become due, or in which the Joint
Venture Subsidiary Borrower obtains an interest, and all products, proceeds,
substitutions, and accessions of or to any of the following (all of which,
together with any other property in which the Administrative Agent may in the
future be granted a security interest pursuant hereto, is referred to
hereinafter as the "Collateral"): (a) All Accounts and Accounts Receivable; (b)
All Inventory; (c) All Contract Rights; (d) All General Intangibles; (e) All
Equipment; (f) All Farm Products; (g) All Goods; (h) All Chattel Paper, Note
Receivables and Receivables (including but not limited to, all license
agreements, all management agreements, all concession agreements, all food
service operation agreements, and all Facilities Agreements); (i) All Fixtures;
(j) All books, records, and information relating to the Collateral and/or to the
operation of the Joint Venture Subsidiary Borrower's business, and all rights of
access to such books, records, and information, and all property in which such
books, records, and information are stored, recorded, and maintained, subject,
in the case of rights of access to premises not owned by the Joint Venture
Subsidiary Borrower, to rights of third parties; (k) All Instruments, Documents
of Title, Documents, policies and certificates of insurance, Securities,
deposits, deposit accounts, money, cash, or other property; (l) All federal,
state, and local tax refunds and/or abatements to which the Joint Venture
Subsidiary Borrower is, or becomes entitled, no matter how or when arising,
including, but not limited to any loss carryback tax refunds; (m) All insurance
proceeds, refunds, and premium rebates, including, without limitation, proceeds
of fire and credit insurance, whether any of such proceeds, refunds, and premium
rebates, arise out of the foregoing (a through l), or otherwise; (n) All liens,
guaranties, rights, remedies, and privileges pertaining to any of the foregoing
(a through m) including the right of stoppage in transit; and (o) All licenses
and permits (including but not limited to, all liquor licenses).
1.2 The foregoing grant of a security interest is in addition to, and
supplemental of, any security interest previously granted by the Joint Venture
Subsidiary Borrower to either the Administrative Agent or the Original Agent and
shall continue in full force and effect applicable to all Liabilities and to any
future advances made by the Administrative Agent or any of the Banks to or on
behalf of the Joint Venture Subsidiary Borrower until this Agreement is
specifically terminated in writing by a duly authorized officer of the
Administrative Agent.
Article II. Definitions.
As herein used, the following terms have the following meanings:
2.1 "Accounts" and "Accounts Receivable" means "accounts," as defined
in the UCC, together with all accounts, accounts receivable, notes, drafts,
acceptances, and other forms of obligations and receivables and rights to
payment for credit extended and for goods sold or leased, or services rendered,
whether or not yet earned by performance; all Inventory which gave rise thereto,
and all rights associated with such Inventory, including the right of stoppage
in transit and all reclaimed, returned, rejected or repossessed Inventory (if
any) the sale of which gave rise to any Account.
2.2 "Contract Rights" means "contract rights," as defined in the UCC,
together with any right to payment under a contract not yet earned by
performance and not evidenced by an instrument or Chattel Paper.
2.3 "Costs of Collection" means and includes all fees, costs and
expenses (including without limitation, all reasonable legal fees, costs and
expenses, and reasonable costs and expenses associated with travel) incurred by
the Agents in connection with the administration of this Agreement and all of
the other Loan Documents. Costs of Collection also means and includes all fees,
costs and expenses (including without limitation, all reasonable legal fees,
costs and expenses, and reasonable costs and expenses associated with travel)
incurred by the Agents and the Banks in connection with preserving, protecting,
collecting, or enforcing the Collateral, the Liabilities and/or the
Administrative Agent's Rights and Remedies or any of the rights and remedies of
the Agents or the Banks against or in respect of any guarantor or other person
liable in respect of the Liabilities (whether or not suit is instituted in
connection with such efforts). The Costs of Collection shall be added to the
Liabilities of the Joint Venture Subsidiary Borrower to the Agents and the
Banks, as if such had been lent, advanced, and credited by the Agents and the
Banks to, or for the benefit of, the Joint Venture Subsidiary Borrower.
2.4 "Equipment" means "equipment," as defined in the UCC, together with
all motor vehicles, rolling stock, machinery, office equipment, plant equipment,
tools, dies, molds, store fixtures, furniture, and other goods, property, and
assets which are used and/or were purchased for use in the operation or
furtherance of the Joint Venture Subsidiary Borrower's business.
2.5 "General Intangibles" means "general intangibles," as defined in
the UCC, together with all: rights to payment for credit extended; deposits;
amounts due to the Joint Venture Subsidiary Borrower; credit memoranda in favor
of the Joint Venture Subsidiary Borrower; warranty claims; all means and
vehicles of investment or hedging, including, without limitation, options,
warrants, and futures contracts; records; customer lists; goodwill; causes of
action; judgments; payments under any settlement or other agreement; literary
rights; rights to performance; royalties; license fees; franchise fees; rights
of admission; licenses; franchises; permits; certificates of convenience and
necessity, and similar rights granted by any governmental authority; copyrights;
trademarks, trade names, service marks, patents, patent applications, patents
pending, and other intellectual property; developmental ideas and concepts;
proprietary processes; blueprints; drawings; designs; diagrams; plans; reports;
charts; catalogs; manuals; technical data; computer programs, computer records,
computer software, rights of access to computer record service bureaus, service
bureau computer contracts, and computer data; proposals; costs estimates, and
other reproductions on paper, or otherwise, of any and all concepts or ideas,
and any matter related to, or connected with, the design, development,
manufacture, sale, marketing, leasing, or use of any or all property produced,
sold, or leased, by the Joint Venture Subsidiary Borrower or credit extended or
services performed, by the Joint Venture Subsidiary Borrower, whether intended
for an individual customer or the general business of the Joint Venture
Subsidiary Borrower, or used or useful in connection with research by the Joint
Venture Subsidiary Borrower.
2.6 "Inventory" means "inventory" as defined in the UCC, together with
all goods, wares, merchandise, raw materials, work in process, finished goods,
and all packaging, advertising, shipping material, and documents related to any
of the foregoing, and all labels, and other devices, names, or marks affixed or
to be affixed thereto for identifying or selling the same, and other personal
property of every description held for sale or lease or furnished or to be
furnished under a contract or contracts of sale or service by the Joint Venture
Subsidiary Borrower, or used or consumed or to be used or consumed in the Joint
Venture Subsidiary Borrower's business, and all goods of said description which
are in transit, and all returned, repossessed and rejected goods of said
description, and all such goods of said description which are detained from or
rejected for entry into the United States, and all documents (whether or not
negotiable) which represent any of the foregoing.
2.7 "Liabilities" has the meaning given to that term in the Loan Agreement.
2.8 "Obligations" means the obligations, covenants, representations and
warranties of the Borrowers (including without limitation, the Joint Venture
Subsidiary Borrower) to any or all of the Banks, and the Agents under the Loan
Documents.
2.9 "Proceeds" means "proceeds," as defined in the UCC, together with
insurance proceeds, and each type of property described in Sections 1-1(a)
through and including 1-1(o) above.
2.10 "Receivables Collateral" refers to that portion of the Collateral
which consists of the Joint Venture Subsidiary Borrower's Accounts, Accounts
Receivable, Contract Rights, General Intangibles, Chattel Paper, Instruments,
Documents of Title, Documents, Securities, letters of credit and bankers'
acceptances, and any rights to payment now held or in which the Joint Venture
Subsidiary Borrower has an interest, or hereafter acquired, or in which the
Joint Venture Subsidiary Borrower obtains an interest.
Article III. Representations, Warranties and Covenants.
3.1 Subject to the limitations set forth in Section 7.19 below, the
Joint Venture Subsidiary Borrower shall pay when due (or on demand if so
payable) the Liabilities and promptly, punctually, and faithfully shall perform
the Obligations.
3.2 The execution and delivery of this Agreement and of any other
instruments or documents executed in connection herewith constitute
representations by the Joint Venture Subsidiary Borrower that such execution and
delivery have received all authorization as may be necessary to permit such
execution and delivery to, and that they do, bind the Joint Venture Subsidiary
Borrower.
3.3 Exhibit A attached hereto and incorporated herein by reference
constitutes a listing of:
(i) all trade names and trade styles under which the Joint Venture
Subsidiary Borrower presently conducts or ever conducted its business; and
(ii) all legal names and legal statuses (such as a corporation
or partnership) under which the Joint Venture Subsidiary Borrower
conducts or ever conducted business.
3.4 The Joint Venture Subsidiary Borrower is, and shall hereafter
remain, the owner of the Collateral free and clear of all liens, encumbrances,
attachments, security interests, purchase money security interests, mortgages,
and charges with the exceptions of (a) the security interest created herein, and
(b) the security interests and other encumbrances (if any) listed on Exhibit B
attached hereto and incorporated herein by reference or as otherwise permitted
in the Loan Agreement. The Joint Venture Subsidiary Borrower does not presently,
and shall not hereafter have possession of any property on consignment. The
Joint Venture Subsidiary Borrower shall timely pay all of the Joint Venture
Subsidiary Borrower's encumbrances which are secured by security interests which
may be superior to that granted the Administrative Agent herein.
3.5 The Joint Venture Subsidiary Borrower's principal place of
business, chief executive office and mailing address is set forth at the
beginning of this Agreement; set forth on Exhibit C are the locations of all
Joint Venture Subsidiary Borrower's other places of business or at which the
Collateral may be kept or located. Except to accomplish sales of Inventory in
the ordinary course of business and to utilize such of the Collateral as is
removed from such locations in the ordinary course of business (such as motor
vehicles), the Collateral will be kept at all times at the Joint Venture
Subsidiary Borrower's principal place of business and chief executive office as
set forth at the beginning of this Agreement or at the locations of the Joint
Venture Subsidiary Borrower's other places of business as set forth on Exhibit
C. All the information contained in the Exhibits to this Agreement is true,
accurate and complete, and the Joint Venture Subsidiary Borrower hereby agrees
to furnish the Administrative Agent written notice within ten (10) days of any
changes therein, or any additional information necessary to insure that the
information contained in the Exhibits remains true, accurate and complete.
3.6 The Joint Venture Subsidiary Borrower shall provide the
Administrative Agent with such information concerning the Joint Venture
Subsidiary Borrower, the Collateral, the operation of the Joint Venture
Subsidiary Borrower's business, and the Joint Venture Subsidiary Borrower's
financial condition as the Administrative Agent may reasonably request from time
to time. All financial information so provided the Administrative Agent by the
Joint Venture Subsidiary Borrower shall be prepared in accordance with generally
accepted accounting principles applied consistently in the preparation thereof
and with prior periods and shall fairly reflect the matters described therein.
3.7 The Joint Venture Subsidiary Borrower shall not sell, offer to
sell, lease, or otherwise transfer or dispose of the Collateral or any part
thereof or any interest therein, except as permitted under the Loan Agreement.
3.8 The Joint Venture Subsidiary Borrower shall execute and deliver to
the Administrative Agent such instruments and shall do all such things from time
to time hereafter as the Administrative Agent may reasonably request to carry
into effect the provisions and intent of this Agreement, to protect and perfect
the Administrative Agent's security interest in and to the Collateral, and to
comply with all applicable statutes and laws, and to facilitate the collection
and/or enforcement of Receivables Collateral. Contemporaneous with the execution
of this Agreement, the Joint Venture Subsidiary Borrower shall execute all such
instruments as may be reasonably required by the Administrative Agent with
respect to the perfection of the security interests granted herein, including
without limitation, financing statements in such form and to be filed in
accordance with the provisions of the Uniform Commercial Code in such State or
States as the Administrative Agent may determine, and applications for notations
of the Administrative Agent as lien holder, mortgagee, or the like, on such
certificates or similar instruments as may have been issued with respect to the
Joint Venture Subsidiary Borrower's ownership of one or more items of the
Collateral. A carbon, photographic, or other reproduction of this Agreement or
of any financing statement or other instrument executed pursuant to this Section
shall be sufficient for filing to perfect the security interests granted herein.
3.9 The Joint Venture Subsidiary Borrower shall (a) keep the Collateral
in good order and repair; (b) not waste or destroy or suffer the waste or
destruction of the Collateral of any part thereof; and (c) not use any of the
Collateral in violation of any policy of insurance thereon.
3.10 The Joint Venture Subsidiary Borrower shall not indirectly do or
cause to be done any act which, if done directly by the Joint Venture Subsidiary
Borrower, would breach any covenant contained herein or in any other agreement
between the Joint Venture Subsidiary Borrower and the Administrative Agent.
3.11 The representations, covenants, and warranties contained herein
are in addition to any others, previously, presently, or hereafter made by the
Joint Venture Subsidiary Borrower to or with the Administrative Agent in any
other instrument.
Article IV. Collection of Accounts, Accounts Receivable, Contract Rights and
Other Collateral.
4.1 At any time after one or more Events of Default has occurred:
(a) The Administrative Agent may notify any of the Joint
Venture Subsidiary Borrower's account or contract debtors, either in
the name of the Administrative Agent or the Joint Venture Subsidiary
Borrower, to make payment directly to the Administrative Agent or such
other address as may be specified by the Administrative Agent, and may
advise any person of the Administrative Agent's security interest in
and to the Collateral, and may collect directly from the obligors
thereon, all amounts due on account of the Collateral; and
(b) At the Administrative Agent's request, the Joint Venture
Subsidiary Borrower will provide written notifications to any or all of
the Joint Venture Subsidiary Borrower's account or contract debtors
concerning the Administrative Agent's security interest in the
Collateral and will request that such account or contract debtors
forward payment thereof directly to the Administrative Agent.
4.2 At any time after one or more Events of Default has occurred, and
after notification to the Joint Venture Subsidiary Borrower from the
Administrative Agent, the Joint Venture Subsidiary Borrower:
(a) shall hold any proceeds and collections of any of the
Collateral in trust for the Administrative Agent, and shall not
commingle such proceeds or collections with any other funds of the
Joint Venture Subsidiary Borrower; and
(b) shall deliver each of the following duly endorsed,
assigned or otherwise made payable to the Administrative Agent; (i) all
such proceeds to the Administrative Agent immediately upon the receipt
thereof by the Joint Venture Subsidiary Borrower in the identical form
received, and (ii) all security or collateral for, guaranties of,
letters of credit, trade and bankers' acceptances, and similar letters
and instruments in respect of any of the Collateral.
4.3 The Joint Venture Subsidiary Borrower hereby irrevocably
constitutes and appoints the Administrative Agent as the Joint Venture
Subsidiary Borrower's true and lawful attorney, upon the occurrence of an Event
of Default, with full power of substitution, to convert the Collateral into cash
at the sole risk, cost, and expense of the Joint Venture Subsidiary Borrower,
but for the sole benefit of the Administrative Agent. The rights and powers
granted the Administrative Agent by the within appointment include but are not
limited to the right and power to:
(a) prosecute, defend, compromise, or release any action
relating to the Collateral;
(b) sign change of address forms to change the address to
which the Joint Venture Subsidiary Borrower's mail is to be sent as the
Administrative Agent shall designate; receive and open the Joint
Venture Subsidiary Borrower's mail; remove any Collateral therefrom and
turn over such mail (other than such Collateral), either to the Joint
Venture Subsidiary Borrower, or to any trustee in bankruptcy, receiver,
assignee for the benefit of creditors of the Joint Venture Subsidiary
Borrower, or other legal representative of the Joint Venture Subsidiary
Borrower whom the Administrative Agent determines to be the appropriate
person to whom to so turn over such mail;
(c) endorse the name of the Joint Venture Subsidiary Borrower
in favor of the Administrative Agent upon any and all checks, drafts,
notes, acceptances, or other items or instruments; sign and endorse the
name of the Joint Venture Subsidiary Borrower on, and receive as
secured party, any of the Collateral, any invoices, schedules of
Collateral, freight or express receipts, or bills of lading, storage
receipts, warehouse receipts, or other documents of title of a same or
different nature relating to the Collateral;
(d) sign the name of the Joint Venture Subsidiary Borrower on
any notice to the Joint Venture Subsidiary Borrower's Account Debtors
or verification of the Receivables Collateral; sign the Joint Venture
Subsidiary Borrower's name on any proof of claim in bankruptcy against
Account Debtors, notices of lien, claims of mechanics liens, or
assignments or releases of mechanics' lien securing the Accounts;
(e) take all such action as may be necessary to obtain the payment of any
letter of credit of which the Joint Venture Subsidiary Borrower is a
beneficiary;
(f) repair, manufacture, assemble, complete, package, deliver, alter or
supply goods, if any, necessary to fulfill in whole or in part the purchase
order of any customer of the Joint Venture Subsidiary Borrower;
(g) use, license, or transfer any or all General Intangibles of the Joint
Venture Subsidiary Borrower; or
(h) sign and file or record any financing or other statement in order to
perfect or protect the Administrative Agent's security interest in the
Collateral.
4.4 In connection with all powers of attorney included in this
Agreement, the Joint Venture Subsidiary Borrower hereby grants unto the
Administrative Agent full power to do any and all things necessary or
appropriate, in connection with the exercise of such powers as fully and
effectually as the Joint Venture Subsidiary Borrower might or could do, and
hereby ratifying all that said attorney shall do or cause to be done by virtue
of this Agreement.
4.5 The Administrative Agent shall not be obligated to do any of the
acts or to exercise any of the powers authorized herein, but if the
Administrative Agent elects to do any such act or to exercise any such powers,
it shall not be accountable for more than it actually receives as a result of
such exercise of power, and shall not be responsible to the Joint Venture
Subsidiary Borrower except for the Administrative Agent's actual willful
misconduct and bad faith.
4.6 All powers conferred upon the Administrative Agent by this
Agreement, being coupled with an interest, shall be irrevocable until this
Agreement is terminated by a written instrument executed by a duly authorized
officer of the Administrative Agent or until all Liabilities are paid in full.
Article V. Events of Default.
Upon the occurrence of any one or more Events of Default, any and all
Liabilities of the Joint Venture Subsidiary Borrower shall become immediately
due and payable, as provided in the Loan Agreement. The occurrence of any such
Event of Default shall also constitute, without notice or demand, a default
under all other agreements between the Administrative Agent and the Joint
Venture Subsidiary Borrower and instruments, documents, and papers given to the
Administrative Agent by the Joint Venture Subsidiary Borrower, whether such
agreements, instruments, or papers now exist or hereafter arise.
Article VI. Rights And Remedies Upon Default.
In addition to all of the rights, remedies, powers, privileges, and
discretions which the Administrative Agent is provided prior to the occurrence
of an Event of Default, the Administrative Agent shall have the following Rights
and Remedies ("Rights and Remedies") upon the occurrence of any Event of
Default.
6.1 Upon the occurrence of any Event of Default, and at any time
thereafter, the Administrative Agent shall have all of the Rights and Remedies
of a secured party upon default under the UCC, in addition to which the
Administrative Agent shall have all of the following Rights and Remedies:
(a) To collect the Receivables Collateral with or without the taking of
possession of any of the Collateral; and/or
(b) To take possession of all or any portion of the Collateral; and/or
(c) To sell, lease, or otherwise dispose of any or all of the
Collateral, in its then condition or following such preparation or
processing as the Administrative Agent deems advisable and with or
without the taking of possession of any of the Collateral; and/or
(d) To apply the Receivables Collateral or the proceeds of the Collateral
towards (but not necessarily in complete satisfaction of) the
Liabilities.
6.2 Any sale or other disposition of the Collateral may be at public or
private sale upon such terms and in such manner as the Administrative Agent
deems advisable, having due regard to compliance with any statute or regulation
which might affect, limit, or apply to the Administrative Agent's disposition of
the Collateral. The Administrative Agent may conduct any such sale or other
disposition of the Collateral upon the Joint Venture Subsidiary Borrower's
premises. Unless the Collateral is perishable or threatens to decline speedily
in value, or is of a type customarily sold on a recognized market (in which
event the Administrative Agent shall provide the Joint Venture Subsidiary
Borrower with such notice as may be practicable under the circumstances), the
Administrative Agent shall give the Joint Venture Subsidiary Borrower at least
the greater of the minimum notice required by law or seven (7) days prior
written notice of the date, time, and place of any proposed public sale, and of
the date after which any private sale or other disposition of the Collateral may
be made. The Administrative Agent may purchase the Collateral, or any portion of
it at any sale held under this Article.
6.3 In connection with the Administrative Agent's exercise of the
Administrative Agent's rights under this Article, the Administrative Agent may
enter upon, occupy, and use any premises owned or occupied by the Joint Venture
Subsidiary Borrower, and may exclude the Joint Venture Subsidiary Borrower from
such premises or portion thereof as may have been so entered upon, occupied, or
used by the Administrative Agent, subject in any such case to the requirements
of applicable law and to the rights of third parties. The Administrative Agent
shall not be required to remove any of the Collateral from any such premises
upon the Administrative Agent's taking possession thereof, and may render any
Collateral unusable to the Joint Venture Subsidiary Borrower. In no event shall
the Administrative Agent be liable to the Joint Venture Subsidiary Borrower for
use of occupancy by the Administrative Agent of any premises pursuant to this
Article, nor for any charge (such as wages for the Joint Venture Subsidiary
Borrower's employees and utilities) incurred in connection with the
Administrative Agent's exercise of the Administrative Agent's Rights and
Remedies.
6.4 The Joint Venture Subsidiary Borrower hereby grants to the
Administrative Agent a nonexclusive irrevocable license to use, apply, and affix
any trademark, tradename, logo, or the like in which the Joint Venture
Subsidiary Borrower now or hereafter has rights, such license being with respect
to the Administrative Agent's exercise of the rights hereunder including,
without limitation, in connection with any completion of the manufacture of
Inventory or sale or other disposition of Inventory.
6.5 Upon the occurrence of any Event of Default, the Administrative
Agent may require the Joint Venture Subsidiary Borrower to assemble the
Collateral and make it available to the Administrative Agent at the Joint
Venture Subsidiary Borrower's sole risk and expense at a place or places which
are reasonably convenient to both the Administrative Agent and the Joint Venture
Subsidiary Borrower.
6.6 The rights, remedies, powers, privileges, and discretions of the
Administrative Agent hereunder (the "Administrative Agent's Rights and
Remedies") shall be cumulative and not exclusive of any rights or remedies which
it would otherwise have. No delay or omission by the Administrative Agent in
exercising or enforcing any of the Administrative Agent's Right and Remedies
shall operate as, or constitute, a waiver thereof. No waiver by the
Administrative Agent of any Event of Default or of any default under any other
agreement shall operate as a waiver of any other default hereunder or under any
other agreement. No single or partial exercise of any of the Administrative
Agent's Rights or Remedies, and no other agreement shall operate as a waiver of
any other default hereunder or under any other agreement or transaction, of
whatever nature entered into between the Administrative Agent and the Joint
Venture Subsidiary Borrower at any time, either express or implied, shall
preclude any other or further exercise of the Administrative Agent's Rights and
Remedies. No waiver by the Administrative Agent of any of the Administrative
Agent's Rights and Remedies on any one occasion shall be deemed a waiver on any
subsequent occasion, nor shall it be deemed a continuing waiver. All of the
Administrative Agent's Right and Remedies may be exercised by the Administrative
Agent at such time or times and in such order of preference as the
Administrative Agent in its sole discretion may determine.
Article VII. General.
7.1 Any and all deposits or other sums at any time credited by or due
to the Joint Venture Subsidiary Borrower from the Administrative Agent or any
Bank or lending affiliates or any bank acting as a participant under any loan
arrangement between the Administrative Agent and the Joint Venture Subsidiary
Borrower, and any cash, securities, instruments, or other property of the Joint
Venture Subsidiary Borrower in the possession of the Administrative Agent, or
any Bank or any of its banking or lending affiliates, and any bank acting as a
participant under any loan arrangement between the Administrative Agent and the
Joint Venture Subsidiary Borrower, whether for safekeeping, or otherwise, or in
transit to or from the Administrative Agent or any Bank or any of its banking or
lending affiliates or any such participant, or in the possession of any third
party acting on the Administrative Agent's or any Bank's behalf (regardless of
the reason the Administrative Agent or any Bank had received same or whether the
Administrative Agent or any Bank has conditionally released the same) shall at
all times constitute security for any and all Liabilities, and may be applied or
set off against such Liabilities at any time after an Event of Default.
7.2 (a) Except as specifically required by this Agreement, the Joint
Venture Subsidiary Borrower WAIVES notice of non-payment, demand,
presentment, protest, and all forms of demand and notice, both with
respect to the Liabilities and the Collateral.
(b) The Joint Venture Subsidiary Borrower, if entitled to it,
WAIVES the right to notice and/or hearing prior to the exercise of the
Administrative Agent's rights upon default.
7.3 The Administrative Agent shall have no duty as to the collection or
protection of the Collateral beyond the safe custody of such of the Collateral
as may come in possession of the Administrative Agent and shall have no duty as
to the preservation of rights against prior parties or any other rights
pertaining thereto. The Administrative Agent's Rights and Remedies may be
exercised without resort or regard to any other source of satisfaction of the
Liabilities.
7.4 All notices, requests and other communications hereunder shall be
given in the manner provided for in the Loan Agreement.
7.5 This Agreement shall be binding upon the Joint Venture Subsidiary
Borrower and the Joint Venture Subsidiary Borrower's successors, and assigns and
shall inure to the benefit of the Administrative Agent and the Administrative
Agent's successors and assigns. In the event that the Administrative Agent
assigns or transfers its rights under this Agreement, the assignee shall
thereupon succeed to and become vested with all rights, powers, privileges, and
duties of the Administrative Agent hereunder and the Administrative Agent shall
thereupon be discharged and relieved from its duties and obligations hereunder.
7.6 Any determination that any provision of this Agreement or any
application thereof is invalid, illegal, or unenforceable in any respect in any
instance shall not affect the validity, legality, and enforceability of such
provision in any other instance, or the validity, legality, or enforceability of
any other provision of this Agreement.
7.7 This Agreement and all other instruments executed in connection
herewith incorporate all discussions and negotiations between the Joint Venture
Subsidiary Borrower and the Administrative Agent, either express or implied,
concerning the matters included herein and in such other instruments, any custom
or usage to the contrary notwithstanding. No such discussions or negotiations
shall limit, modify, or otherwise affect the provisions hereof. No modification,
amendment, or waiver of any provision of this Agreement or of any provision of
any other agreement between the Joint Venture Subsidiary Borrower and the
Administrative Agent is effective unless executed in writing by the party to be
charged with such modification, amendment and waiver, and if such party be the
Administrative Agent, then by a duly authorized officer thereof.
7.8 The proceeds of any collection, sale, or disposition of the
Collateral, or of any other payments received hereunder, shall be applied toward
the Liabilities in such order and manner as the Administrative Agent determines
in its sole discretion, any statute, custom, or usage to the contrary
notwithstanding. The Joint Venture Subsidiary Borrower shall remain liable to
the Administrative Agent for any deficiency remaining following such
application.
7.9 The Joint Venture Subsidiary Borrower shall pay on demand all Costs
of Collection and all expenses of the Administrative Agent in connection with
the preparation, execution, and delivery of this Agreement and of any other
documents and agreements between the Joint Venture Subsidiary Borrower and the
Administrative Agent, whether now existing or hereafter arising, and all other
expenses which may be incurred by the Administrative Agent in preparing or
amending this Agreement and all other agreements, instruments, and documents
related thereto, or otherwise with respect to the Liabilities. The Joint Venture
Subsidiary Borrower authorizes the Administrative Agent to pay all such expenses
and to charge the same to any account of the Joint Venture Subsidiary Borrower
with the Administrative Agent.
7.10 All amounts which the Administrative Agent may advance under this
Agreement shall be included in the Liabilities, shall be repayable to the
Administrative Agent with interest at the highest pre-default rate charged the
Joint Venture Subsidiary Borrower by the Administrative Agent under the Loan
Agreement, on demand (and if not paid within five (5) days of notice to the
Joint Venture Subsidiary Borrower, at the default rate set forth in subsection
3.4(c) of the Loan Agreement, and may be charged by the Administrative Agent to
any account which the Joint Venture Subsidiary Borrower maintains with the
Administrative Agent.
7.11 This Agreement and all other instruments, documents, and papers
which relate thereto which have been or may be hereinafter furnished the
Administrative Agent may be reproduced by the Administrative Agent by any
photographic, photostatic, microfilm, micro-card, miniature photographic,
xerographic, or similar process, and the Administrative Agent may destroy the
original from which any document was so reproduced. Any such reproduction shall
be admissible in evidence as the original itself in any judicial or
administrative proceeding (whether or not the original is in existence and
whether or not such reproduction was made in the regular course of business).
7.12 This Agreement and all rights and obligations hereunder, including
matters of construction, validity and performance, shall be governed by the laws
of The Commonwealth of Massachusetts. The Joint Venture Subsidiary Borrower
submits itself to the jurisdiction of the Courts of said Commonwealth for all
purposes with respect to this Agreement and the Joint Venture Subsidiary
Borrower's relationship with the Administrative Agent.
7.13 The Joint Venture Subsidiary Borrower shall indemnify, defend, and
hold each of the Agents and the Banks harmless of and from any claim brought or
threatened against any of the Agents or the Banks by the Joint Venture
Subsidiary Borrower, any guarantor or endorser of the Liabilities, or any other
person (as well as from attorneys' reasonable fees and expenses in connection
therewith) on account of the relationship of any of the Agents or the Banks with
the Joint Venture Subsidiary Borrower or any other guarantor or endorser of the
Liabilities (each of which may be defended, compromised, settled, or pursued by
the Administrative Agent, for the benefit of the Banks and the Documentation
Agent, with counsel of the Administrative Agent's selection, but at the expense
of the Joint Venture Subsidiary Borrower). Notwithstanding any other provision
of this Agreement, the indemnification contained herein shall survive payment of
the Liabilities and/or any termination, release, or discharge executed by the
any of the Agents or the Banks in favor of the Joint Venture Subsidiary
Borrower.
7.14 This Agreement shall remain in full force and effect until
specifically terminated in writing by a duly authorized officer of the
Administrative Agent, or (subject to Section 7.13) until all Liabilities are
paid in full.
7.15 The failure by the Joint Venture Subsidiary Borrower to perform
all and singular the Joint Venture Subsidiary Borrower's obligations hereunder
will result in irreparable harm to the Administrative Agent for which the
Administrative Agent will have no adequate remedy at law. Consequently, such
obligations are specifically enforceable by the Administrative Agent.
7.16 It is intended that:
(a) this Agreement take effect as a sealed instrument;
(b) the security interests created by this Agreement attach to
all of the Joint Venture Subsidiary Borrower's assets now owned or
hereafter acquired which are capable of being subject to a security
interest;
(c) the security interests created by this agreement secure
all Liabilities of the Joint Venture Subsidiary Borrower to the
Administrative Agent, whether now existing or hereafter arising;
(d) all costs and expenses incurred by the Administrative
Agent in connection with the Administrative Agent's relationship(s)
with the Joint Venture Subsidiary Borrower shall be borne by the Joint
Venture Subsidiary Borrower;
(e) the Administrative Agent's consent to any action of the
Joint Venture Subsidiary Borrower which is prohibited unless such
consent is given may be given or refused by the Administrative Agent in
its sole discretion; and
(f) the Administrative Agent's Rights and Remedies provided herein are
subject to requirements of applicable law.
7.17 The Joint Venture Subsidiary Borrower acknowledges having received a
copy of the within Agreement.
7.18 Any provision contained herein to the contrary notwithstanding:
(i) subject to subsection (iii) below, the Collateral
hereunder shall not include any contract, agreement or instrument to
the extent that the assignment contemplated hereunder would require the
consent or approval of any third party, or would adversely affect the
enforceability of any such contract, agreement or instrument or the
requirement that the Joint Venture Subsidiary Borrower be paid, repaid
or reimbursed in the event of termination of such contract, agreement
or instrument or would constitute a breach or default under any such
contract, agreement or instrument, unless and until such consent or
approval has been obtained;
(ii) subject to subsection (iii) below, the Collateral
hereunder shall not include any liquor license or any other license the
assignment of which would require the consent or approval of any
governmental authority or agency or other third party unless and until
such consent or approval has been obtained; and
(iii) unless an Event of Default has occurred and the
Liabilities of the Joint Venture Subsidiary Borrower have been
accelerated pursuant to Section 8.2 of the Loan Agreement, the Joint
Venture Subsidiary Borrower shall not be required to obtain or seek to
obtain any consent or approval referred to above.
To the extent that any of the Collateral is further assigned to the
Administrative Agent pursuant to a collateral assignment or other instrument
delivered by the Joint Venture Subsidiary Borrower to the Administrative Agent,
then in the event of any inconsistency with respect to matters relating to such
Collateral between the provisions of such assignment or instrument and the
provisions of this Agreement, the provisions of such Assignment or instrument
shall control.
7.19 (a) Notwithstanding any other provision contained in this
Agreement or in any of the other Loan Documents to the contrary (including,
without limitation, those relating to indemnification, costs and expenses), the
Administrative Agent's sole recourse against the Joint Venture Subsidiary
Borrower under this Agreement for payment of the Liabilities and for all other
payments due hereunder shall be against the Collateral and all of the other
Joint Venture Collateral of the Joint Venture Subsidiary Borrower, and the Joint
Venture Subsidiary Borrower shall not be liable for any unpaid Liabilities or
for any such other amount to the extent that the proceeds of the sale or other
disposition of the Collateral and all such other Joint Venture Collateral, are
insufficient to pay such amounts; provided, however, that notwithstanding the
foregoing to the contrary, the Joint Venture Subsidiary Borrower shall be liable
in its individual capacity to the Administrative Agent for any loss, expense,
claim or damage suffered by the Administrative Agent as a result of the breach
by the Joint Venture Subsidiary Borrower of any of its representations,
warranties or covenants contained in this Agreement or in any of the other Loan
Documents (other than the Loan Agreement) to which it is a party; provided
further, however, that the foregoing provisions of this subsection (a) shall in
no way be deemed to affect (i) any of the liabilities and obligations of any of
the Borrowers (other than the Joint Venture Subsidiary Borrower) under this
Agreement or any of the other Loan Documents; or (ii) the rights or interests of
the Administrative Agent in and to the Collateral and all such other Joint
Venture Collateral of the Joint Venture Subsidiary Borrower or any part thereof
or any other rights or remedies of the Administrative Agent under this Agreement
or any of the other Loan Documents with respect to the Collateral or all such
other Joint Venture Collateral or under any other document, agreement or
instrument securing the Liabilities.
(b) Notwithstanding any term or provision contained herein or in any of
the other Loan Documents to the contrary (including, without limitation, those
relating to indemnification, costs and expenses), the Administrative Agent's
sole recourse hereunder for payment of the Liabilities and for all other
payments due hereunder shall be against the assets of the Joint Venture
Subsidiary Borrower as and to the extent provided in the preceding subsection
(a), and the Administrative Agent shall have no recourse for any such payment
against any of the Joint Venturers of the Joint Venture Subsidiary Borrower
(other than Fine Host) or any of their assets, notwithstanding that any of the
Joint Venturers might otherwise be liable for obligations of the Joint Venture
Subsidiary Borrower under applicable law, the organizational documents of the
Joint Venture Subsidiary Borrower or otherwise; provided, however, that the
foregoing provisions of this subsection (b) shall in no way be deemed to affect
(i) any of the liabilities and obligations of any of the Borrowers (other than
the Joint Venture Subsidiary Borrower) under this Agreement or any of the other
Loan Documents; or (ii) the rights or interests of the Administrative Agent in
and to the Collateral and all of the other Joint Venture Collateral of the Joint
Venture Subsidiary Borrower or any part thereof or any other rights or remedies
of the Administrative Agent under this Agreement or any of the other Loan
Documents with respect to the Collateral and all such other Joint Venture
Collateral or under any other document, agreement or instrument securing the
Liabilities. In the event of any inconsistency between the provisions of this
subsection (b) and the provisions of any of the other Loan Documents (including,
without limitations, provisions relating to joint and several liability or
liability on the part of any Person comprising part of another Person), the
provisions of this subsection (b) shall control.
[THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK]
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this Agreement under
seal on the date first written above.
JOINT VENTURE SUBSIDIARY BORROWER:
WITNESS:
By:
Name Name:
Title:
Its duly authorized officer or agent
ADMINISTRATIVE AGENT:
WITNESS: BANKBOSTON, N.A., AS ADMINISTRATIVE AGENT
By:
Name Name:
Title:
Its duly authorized officer
<PAGE>
EXHIBIT A
Trade Names: legal status; etc. ('3-3)
<PAGE>
EXHIBIT B
Other Encumbrances and Liens ('3-4)
<PAGE>
EXHIBIT C
Locations ('3-5)
61936_4
EXHIBIT F
FORM OF
[SECOND] AMENDED AND RESTATED SECURITY AGREEMENT
(for [Name of Subsidiary Borrower])
This [SECOND] AMENDED AND RESTATED SECURITY AGREEMENT (the "Agreement")
is made as of July __, 1997, by and between (a) ________________________, a
__________________________, with its principal place of business at
_______________________________________________ (together with its successors
and assigns, the "Subsidiary Borrower") and (b) BANKBOSTON, N.A., as
Administrative Agent (in such capacity, the "Administrative Agent") for various
banks and other financial institutions which are or may hereafter become parties
(said banks and other financial institutions are hereinafter referred to
collectively as the "Banks") to that certain Fourth Amended and Restated Loan
Agreement, dated of even date herewith (as the same may be hereafter further
amended, modified, supplemented, extended or restated, from time to time, the
"Loan Agreement") by and among Fine Host Corporation, a Delaware corporation
(together with its successors and assigns, "Fine Host"), all of the Subsidiaries
of Fine Host (including without limitation, the Subsidiary Borrower), the
Administrative Agent, USTrust, as Documentation Agent for the Banks (in such
capacity, the "Documentation Agent")(the Administrative Agent and the
Documentation Agent are hereinafter sometimes referred to collectively as the
"Agents") and the Banks.
All capitalized terms not defined herein but defined in the Loan
Agreement shall have the meanings given to such terms in the Loan Agreement, and
if not defined in the Loan Agreement, then the meanings given to such terms in
the Uniform Commercial Code, as in effect, from time to time, in The
Commonwealth of Massachusetts (the "UCC").
WITNESSETH:
WHEREAS, in connection with the Existing Loan Agreement, the Subsidiary
Borrower entered into, among other things, a certain [First Amended and
Restated] Security Agreement, dated as of ___________, 199_ (the "Existing
Security Agreement"), by and between the Subsidiary Borrower and USTrust, as
Lender and Agent for the Existing Banks (in such capacity, the "Original
Agent"), pursuant to which, among other things, the Subsidiary Borrower granted
to the Original Agent, for the ratable benefit of the Existing Banks, a security
interest in the assets of the Subsidiary Borrower, as more particularly
described therein and herein, to secure all of the obligations and liabilities
of the Subsidiary Borrower to the Existing Banks; and
WHEREAS, Fine Host and all of its Subsidiaries (including without
limitation, the Subsidiary Borrower) have requested that the Existing Banks
amend and restate in its entirety the Existing Loan Agreement in the manner
provided in the Loan Agreement; and
WHEREAS, the Agents and all of the Banks which are not Existing Banks
have agreed to become parties to the Loan Agreement; and
WHEREAS, it is a condition precedent to the effectiveness of the Loan
Agreement and to the obligations of the Banks to make Extensions of Credit
provided for therein that the Subsidiary Borrower shall have amended and
restated in its entirety the Existing Security Agreement in the manner provided
herein.
NOW, THEREFORE, in consideration of the premises contained herein, and
to induce the Banks to amend and restate the Existing Loan Agreement, as
provided in the Loan Agreement, and to induce the Banks to make Extensions of
Credit under the Loan Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Subsidiary
Borrower and the Administrative Agent, for the ratable benefit of the Banks,
hereby amend, restate and replace the Existing Security Agreement to read in its
entirety as follows:
<PAGE>
Article I. Grant of Security Interest.
1.1 To secure the prompt, punctual, and faithful performance by the
Subsidiary Borrower of all of the Liabilities, the Subsidiary Borrower hereby
grants to the Administrative Agent, for the ratable benefit of the Banks, a
continuing security interest in and to, and assigns to the Administrative Agent,
for the ratable benefit of the Banks, all of the rights, title and interests of
the Subsidiary Borrower in and to, the following, and each item thereof, whether
now owned or now due, or in which the Subsidiary Borrower has an interest, or
hereafter at any time in the future, acquired, arising, or to become due, or in
which the Subsidiary Borrower obtains an interest, and all products, proceeds,
substitutions, and accessions of or to any of the following (all of which,
together with any other property in which the Administrative Agent may in the
future be granted a security interest pursuant hereto, is referred to
hereinafter as the "Collateral"): (a) All Accounts and Accounts Receivable; (b)
All Inventory; (c) All Contract Rights; (d) All General Intangibles; (e) All
Equipment; (f) All Farm Products; (g) All Goods; (h) All Chattel Paper, Note
Receivables and Receivables (including but not limited to, all license
Agreements, all management agreements, all concession agreements, all food
service operation agreements, and all Facilities Agreements); (i) All Fixtures;
(j) All books, records, and information relating to the Collateral and/or to the
operation of the Subsidiary Borrower's business, and all rights of access to
such books, records, and information, and all property in which such books,
records, and information are stored, recorded, and maintained, subject, in the
case of rights of access to premises not owned by the Subsidiary Borrower, to
rights of third parties; (k) All Instruments, Documents of Title, Documents,
policies and certificates of insurance, Securities, deposits, deposit accounts,
money, cash, or other property; (l) All federal, state, and local tax refunds
and/or abatements to which the Subsidiary Borrower is, or becomes entitled, no
matter how or when arising, including, but not limited to any loss carryback tax
refunds; (m) All insurance proceeds, refunds, and premium rebates, including,
without limitation, proceeds of fire and credit insurance, whether any of such
proceeds, refunds, and premium rebates, arise out of the foregoing (a through
l), or otherwise; (n) All liens, guaranties, rights, remedies, and privileges
pertaining to any of the foregoing (a through m) including the right of stoppage
in transit; and (o) All licenses and permits (including but not limited to, all
liquor licenses).
<PAGE>
1.2 The foregoing grant of a security interest is in addition to, and
supplemental of, any security interest previously granted by the Subsidiary
Borrower to either the Administrative Agent or the Original Bank and shall
continue in full force and effect applicable to all Liabilities and to any
future advances made by the Administrative Agent or any of the Banks to or on
behalf of the Subsidiary Borrower until this Agreement is specifically
terminated in writing by a duly authorized officer of the Administrative Agent.
Article II. Definitions.
As herein used, the following terms have the following meanings:
2.1 "Accounts" and "Accounts Receivable" means "accounts," as defined
in the UCC, together with all accounts, accounts receivable, notes, drafts,
acceptances, and other forms of obligations and receivables and rights to
payment for credit extended and for goods sold or leased, or services rendered,
whether or not yet earned by performance; all Inventory which gave rise thereto,
and all rights associated with such Inventory, including the right of stoppage
in transit and all reclaimed, returned, rejected or repossessed Inventory (if
any) the sale of which gave rise to any Account.
2.2 "Contract Rights" means "contract rights," as defined in the UCC,
together with any right to payment under a contract not yet earned by
performance and not evidenced by an instrument or Chattel Paper.
2.3 "Costs of Collection" means and includes all fees, costs and
expenses (including without limitation, all reasonable legal fees, costs and
expenses, and reasonable costs and expenses associated with travel) incurred by
the Agents in connection with the administration of this Agreement and all of
the other Loan Documents. Costs of Collection also means and includes all fees,
costs and expenses (including without limitation, all reasonable legal fees,
costs and expenses, and reasonable costs and expenses associated with travel)
incurred by the Agents and the Banks in connection with preserving, protecting,
collecting, or enforcing the Collateral, the Liabilities and/or the
Administrative Agent's Rights and Remedies or any of the rights and remedies of
the Agents or the Banks against or in respect of any guarantor or other person
liable in respect of the Liabilities (whether or not suit is instituted in
connection with such efforts). The Costs of Collection shall be added to the
Liabilities of the Subsidiary Borrower to the Agents and the Banks, as if such
had been lent, advanced, and credited by the Agents and the Banks to, or for the
benefit of, the Subsidiary Borrower.
2.4 "Equipment" means "equipment," as defined in the UCC, together with
all motor vehicles, rolling stock, machinery, office equipment, plant equipment,
tools, dies, molds, store fixtures, furniture, and other goods, property, and
assets which are used and/or were purchased for use in the operation or
furtherance of the Subsidiary Borrower's business.
<PAGE>
2.5 "General Intangibles" means "general intangibles," as defined in
the UCC, together with all: rights to payment for credit extended; deposits;
amounts due to the Subsidiary Borrower; credit memoranda in favor of the
Subsidiary Borrower; warranty claims; all means and vehicles of investment or
hedging, including, without limitation, options, warrants, and futures
contracts; records; customer lists; goodwill; causes of action; judgments;
payments under any settlement or other agreement; literary rights; rights to
performance; royalties; license fees; franchise fees; rights of admission;
licenses; franchises; permits; certificates of convenience and necessity, and
similar rights granted by any governmental authority; copyrights; trademarks,
trade names, service marks, patents, patent applications, patents pending, and
other intellectual property; developmental ideas and concepts; proprietary
processes; blueprints; drawings; designs; diagrams; plans; reports; charts;
catalogs; manuals; technical data; computer programs, computer records, computer
software, rights of access to computer record service bureaus, service bureau
computer contracts, and computer data; proposals; costs estimates, and other
reproductions on paper, or otherwise, of any and all concepts or ideas, and any
matter related to, or connected with, the design, development, manufacture,
sale, marketing, leasing, or use of any or all property produced, sold, or
leased, by the Subsidiary Borrower or credit extended or services performed, by
the Subsidiary Borrower, whether intended for an individual customer or the
general business of the Subsidiary Borrower, or used or useful in connection
with research by the Subsidiary Borrower.
2.6 "Inventory" means "inventory" as defined in the UCC, together with
all goods, wares, merchandise, raw materials, work in process, finished goods,
and all packaging, advertising, shipping material, and documents related to any
of the foregoing, and all labels, and other devices, names, or marks affixed or
to be affixed thereto for identifying or selling the same, and other personal
property of every description held for sale or lease or furnished or to be
furnished under a contract or contracts of sale or service by the Subsidiary
Borrower, or used or consumed or to be used or consumed in the Subsidiary
Borrower's business, and all goods of said description which are in transit, and
all returned, repossessed and rejected goods of said description, and all such
goods of said description which are detained from or rejected for entry into the
United States, and all documents (whether or not negotiable) which represent any
of the foregoing.
2.7 "Liabilities" has the meaning given to that term in the Loan Agreement.
2.8 "Obligations" means the obligations, covenants, representations and
warranties of the Borrowers (including without limitation, the Subsidiary
Borrower) to any or all of the Banks, and the Agents under the Loan Documents.
2.9 "Proceeds" means "proceeds," as defined in the UCC, together with
insurance proceeds, and each type of property described in Sections 1-1(a)
through and including 1-1(o) above.
2.10 "Receivables Collateral" refers to that portion of the Collateral
which consists of the Subsidiary Borrower's Accounts, Accounts Receivable,
Contract Rights, General Intangibles, Chattel Paper, Instruments, Documents of
Title, Documents, Securities, letters of credit and bankers' acceptances, and
any rights to payment now held or in which the Subsidiary Borrower has an
interest, or hereafter acquired, or in which the Subsidiary Borrower obtains an
interest.
Article III. Representations, Warranties and Covenants.
3.1 The Subsidiary Borrower shall pay when due (or on demand if so
payable) the Liabilities and promptly, punctually, and faithfully shall perform
the Obligations.
3.2 The Subsidiary Borrower presently is and shall hereafter remain in
good standing as a corporation in that State indicated in the Preamble of this
Agreement and is and shall hereafter remain duly qualified and in good standing
in every other State in which, by reason of the nature or location of the
Subsidiary Borrower's assets or operation of the Subsidiary Borrower's business,
such qualification may be necessary, except those States in which the failure to
qualify and remain in good standing would not have a Material Adverse Effect.
The execution and delivery of this Agreement and of any other instruments or
documents executed in connection herewith constitute representations by the
Subsidiary Borrower that such execution and delivery have received all
authorization as may be necessary to permit such execution and delivery to, and
that they do, bind the Subsidiary Borrower.
3.3 Exhibit A attached hereto and incorporated herein by reference
constitutes a listing of:
(i) all trade names and trade styles under which the Subsidiary Borrower
presently conducts or ever conducted its business; and
(ii) all legal names and legal statuses (such as a corporation or
partnership) under which the Subsidiary Borrower conducts or ever conducted
business.
3.4 The Subsidiary Borrower is, and shall hereafter remain, the owner
of the Collateral free and clear of all liens, encumbrances, attachments,
security interests, purchase money security interests, mortgages, and charges
with the exceptions of (a) the security interest created herein, and (b) the
security interests and other encumbrances (if any) listed on Exhibit B attached
hereto and incorporated herein by reference or as otherwise permitted in the
Loan Agreement. The Subsidiary Borrower does not presently, and shall not
hereafter have possession of any property on consignment. The Subsidiary
Borrower shall timely pay all of the Subsidiary Borrower's encumbrances which
are secured by security interests which may be superior to that granted the
Administrative Agent herein.
3.5 The Subsidiary Borrower's principal place of business, chief
executive office and mailing address is set forth at the beginning of this
Agreement; set forth on Exhibit C are the locations of all Subsidiary Borrower's
other places of business or at which the Collateral may be kept or located.
Except to accomplish sales of Inventory in the ordinary course of business and
to utilize such of the Collateral as is removed from such locations in the
ordinary course of business (such as motor vehicles), the Collateral will be
kept at all times at the Subsidiary Borrower's principal place of business and
chief executive office as set forth at the beginning of this Agreement or at the
locations of the Subsidiary Borrower's other places of business as set forth on
Exhibit C. All the information contained in the Exhibits to this Agreement is
true, accurate and complete, and the Subsidiary Borrower hereby agrees to
furnish the Administrative Agent written notice within ten (10) days of any
changes therein, or any additional information necessary to insure that the
information contained in the Exhibits remains true, accurate and complete.
3.6 The Subsidiary Borrower shall provide the Administrative Agent with
such information concerning the Subsidiary Borrower, the Collateral, the
operation of the Subsidiary Borrower's business, and the Subsidiary Borrower's
financial condition as the Administrative Agent may reasonably request from time
to time. All financial information so provided the Administrative Agent by the
Subsidiary Borrower shall be prepared in accordance with generally accepted
accounting principles applied consistently in the preparation thereof and with
prior periods and shall fairly reflect the matters described therein.
3.7 All covenants, representations, and warranties made by the
Subsidiary Borrower pursuant to the terms of the Loan Agreement are hereby
incorporated herein by reference, and all provisions of the Loan Agreement
granting the Administrative Agent rights, privileges, or remedies are likewise
also incorporated herein by reference.
3.8 The Subsidiary Borrower shall not sell, offer to sell, lease, or
otherwise transfer or dispose of the Collateral or any part thereof or any
interest therein, except as permitted under the Loan Agreement.
3.9 The Subsidiary Borrower shall execute and deliver to the
Administrative Agent such instruments and shall do all such things from time to
time hereafter as the Administrative Agent may reasonably request to carry into
effect the provisions and intent of this Agreement, to protect and perfect the
Administrative Agent's security interest in and to the Collateral, and to comply
with all applicable statutes and laws, and to facilitate the collection and/or
enforcement of Receivables Collateral. Contemporaneous with the execution of
this Agreement, the Subsidiary Borrower shall execute all such instruments as
may be reasonably required by the Administrative Agent with respect to the
perfection of the security interests granted herein, including without
limitation, financing statements in such form and to be filed in accordance with
the provisions of the Uniform Commercial Code in such State or States as the
Administrative Agent may determine, and applications for notations of the
Administrative Agent as lien holder, mortgagee, or the like, on such
certificates or similar instruments as may have been issued with respect to the
Subsidiary Borrower's ownership of one or more items of the Collateral. A
carbon, photographic, or other reproduction of this Agreement or of any
financing statement or other instrument executed pursuant to this Section shall
be sufficient for filing to perfect the security interests granted herein.
3.10 The Subsidiary Borrower shall (a) keep the Collateral in good
order and repair; (b) not waste or destroy or suffer the waste or destruction of
the Collateral of any part thereof; and (c) not use any of the Collateral in
violation of any policy of insurance thereon.
3.11 The Subsidiary Borrower shall not indirectly do or cause to be
done any act which, if done directly by the Subsidiary Borrower, would breach
any covenant contained herein or in any other agreement between the Subsidiary
Borrower and the Administrative Agent.
3.12 The representations, covenants and warranties contained herein are
in addition to any others, previously, presently, or hereafter made by the
Subsidiary Borrower to or with the Administrative Agent in any other instrument.
Article IV. Collection of Accounts, Accounts Receivable, Contract Rights
and Other Collateral.
4.1 At any time after one or more Events of Default has occurred:
(a) The Administrative Agent may notify any of the Subsidiary
Borrower's account or contract debtors, either in the name of the
Administrative Agent or the Subsidiary Borrower, to make payment
directly to the Administrative Agent or such other address as may be
specified by the Administrative Agent, and may advise any person of the
Administrative Agent's security interest in and to the Collateral, and
may collect directly from the obligors thereon, all amounts due on
account of the Collateral; and
(b) At the Administrative Agent's request, the Subsidiary
Borrower will provide written notifications to any or all of the
Subsidiary Borrower's account or contract debtors concerning the
Administrative Agent's security interest in the Collateral and will
request that such account or contract debtors forward payment thereof
directly to the Administrative Agent.
4.2 At any time after one or more Events of Default has occurred, and
after notification to the Subsidiary Borrower from the Administrative Agent, the
Subsidiary Borrower:
(a) shall hold any proceeds and collections of any of the
Collateral in trust for the Administrative Agent, and shall not
commingle such proceeds or collections with any other funds of the
Subsidiary Borrower; and
(b) shall deliver each of the following duly endorsed,
assigned or otherwise made payable to the Administrative Agent; (i) all
such proceeds to the Administrative Agent immediately upon the receipt
thereof by the Subsidiary Borrower in the identical form received, and
(ii) all security or collateral for, guaranties of, letters of credit,
trade and bankers' acceptances, and similar letters and instruments in
respect of any of the Collateral.
4.3 The Subsidiary Borrower hereby irrevocably constitutes and appoints
the Administrative Agent as the Subsidiary Borrower's true and lawful attorney,
upon the occurrence of an Event of Default, with full power of substitution, to
convert the Collateral into cash at the sole risk, cost, and expense of the
Subsidiary Borrower, but for the sole benefit of the Administrative Agent. The
rights and powers granted the Administrative Agent by the within appointment
include but are not limited to the right and power to:
(a) prosecute, defend, compromise, or release any action
relating to the Collateral;
(b) sign change of address forms to change the address to
which the Subsidiary Borrower's mail is to be sent as the
Administrative Agent shall designate; receive and open the Subsidiary
Borrower's mail; remove any Collateral therefrom and turn over such
mail (other than such Collateral), either to the Subsidiary Borrower,
or to any trustee in bankruptcy, receiver, assignee for the benefit of
creditors of the Subsidiary Borrower, or other legal representative of
the Subsidiary Borrower whom the Administrative Agent determines to be
the appropriate person to whom to so turn over such mail;
(c) endorse the name of the Subsidiary Borrower in favor of
the Administrative Agent upon any and all checks, drafts, notes,
acceptances, or other items or instruments; sign and endorse the name
of the Subsidiary Borrower on, and receive as secured party, any of the
Collateral, any invoices, schedules of Collateral, freight or express
receipts, or bills of lading, storage receipts, warehouse receipts, or
other documents of title of a same or different nature relating to the
Collateral;
(d) sign the name of the Subsidiary Borrower on any notice to
the Subsidiary Borrower's Account Debtors or verification of the
Receivables Collateral; sign the Subsidiary Borrower's name on any
proof of claim in bankruptcy against Account Debtors, notices of lien,
claims of mechanics liens, or assignments or releases of mechanics'
lien securing the Accounts;
(e) take all such action as may be necessary to obtain
the payment of any letter of credit of which the Subsidiary Borrower
is a beneficiary;
(f) repair, manufacture, assemble, complete, package, deliver,
alter or supply goods, if any, necessary to fulfill in whole or in part
the purchase order of any customer of the Subsidiary Borrower;
(g) use, license, or transfer any or all General
Intangibles of the Subsidiary Borrower; or
(h) sign and file or record any financing or other statement
in order to perfect or protect the Administrative Agent's security
interest in the Collateral.
4.4 In connection with all powers of attorney included in this
Agreement, the Subsidiary Borrower hereby grants unto the Administrative Agent
full power to do any and all things necessary or appropriate, in connection with
the exercise of such powers as fully and effectually as the Subsidiary Borrower
might or could do, and hereby ratifying all that said attorney shall do or cause
to be done by virtue of this Agreement.
4.5 The Administrative Agent shall not be obligated to do any of the
acts or to exercise any of the powers authorized herein, but if the
Administrative Agent elects to do any such act or to exercise any such powers,
it shall not be accountable for more than it actually receives as a result of
such exercise of power, and shall not be responsible to the Subsidiary Borrower
except for the Administrative Agent's actual willful misconduct and bad faith.
4.6 All powers conferred upon the Administrative Agent by this
Agreement, being coupled with an interest, shall be irrevocable until this
Agreement is terminated by a written instrument executed by a duly authorized
officer of the Administrative Agent or until all Liabilities are paid in full.
Article V. Events of Default.
Upon the occurrence of any one or more Events of Default, any and all
Liabilities of the Subsidiary Borrower shall become immediately due and payable,
as provided in the Loan Agreement. The occurrence of any such Event of Default
shall also constitute, without notice or demand, a default under all other
agreements between the Administrative Agent and the Subsidiary Borrower and
instruments, documents, and papers given to the Administrative Agent by the
Subsidiary Borrower, whether such agreements, instruments, or papers now exist
or hereafter arise.
Article VI. Rights And Remedies Upon Default.
In addition to all of the rights, remedies, powers, privileges, and
discretions which the Administrative Agent is provided prior to the occurrence
of an Event of Default, the Administrative Agent shall have the following Rights
and Remedies ("Rights and Remedies") upon the occurrence of any Event of
Default.
6.1 Upon the occurrence of any Event of Default, and at any time
thereafter, the Administrative Agent shall have all of the Rights and Remedies
of a secured party upon default under the UCC, in addition to which the
Administrative Agent shall have all of the following Rights and Remedies:
(a) To collect the Receivables Collateral with or
without the taking of possession of any of the
Collateral; and/or
(b) To take possession of all or any portion of the
Collateral; and/or
(c) To sell, lease, or otherwise dispose of any or all of the
Collateral, in its then condition or following such preparation or
processing as the Administrative Agent deems advisable and with or
without the taking of possession of any of the Collateral; and/or
(d) To apply the Receivables Collateral or the proceeds
of the Collateral towards (but not necessarily in complete
satisfaction of) the Liabilities.
6.2 Any sale or other disposition of the Collateral may be at public or
private sale upon such terms and in such manner as the Administrative Agent
deems advisable, having due regard to compliance with any statute or regulation
which might affect, limit, or apply to the Administrative Agent's disposition of
the Collateral. The Administrative Agent may conduct any such sale or other
disposition of the Collateral upon the Subsidiary Borrower's premises. Unless
the Collateral is perishable or threatens to decline speedily in value, or is of
a type customarily sold on a recognized market (in which event the
Administrative Agent shall provide the Subsidiary Borrower with such notice as
may be practicable under the circumstances), the Administrative Agent shall give
the Subsidiary Borrower at least the greater of the minimum notice required by
law or seven (7) days prior written notice of the date, time, and place of any
proposed public sale, and of the date after which any private sale or other
disposition of the Collateral may be made. The Administrative Agent may purchase
the Collateral, or any portion of it at any sale held under this Article.
6.3 In connection with the Administrative Agent's exercise of the
Administrative Agent's rights under this Article, the Administrative Agent may
enter upon, occupy, and use any premises owned or occupied by the Subsidiary
Borrower, and may exclude the Subsidiary Borrower from such premises or portion
thereof as may have been so entered upon, occupied, or used by the
Administrative Agent, subject in any such case to the requirements of applicable
law and to the rights of third parties. The Administrative Agent shall not be
required to remove any of the Collateral from any such premises upon the
Administrative Agent's taking possession thereof, and may render any Collateral
unusable to the Subsidiary Borrower. In no event shall the Administrative Agent
be liable to the Subsidiary Borrower for use of occupancy by the Administrative
Agent of any premises pursuant to this Article, nor for any charge (such as
wages for the Subsidiary Borrower's employees and utilities) incurred in
connection with the Administrative Agent's exercise of the Administrative
Agent's Rights and Remedies.
6.4 The Subsidiary Borrower hereby grants to the Administrative Agent a
nonexclusive irrevocable license to use, apply, and affix any trademark,
tradename, logo, or the like in which the Subsidiary Borrower now or hereafter
has rights, such license being with respect to the Administrative Agent's
exercise of the rights hereunder including, without limitation, in connection
with any completion of the manufacture of Inventory or sale or other disposition
of Inventory.
6.5 Upon the occurrence of any Event of Default, the Administrative
Agent may require the Subsidiary Borrower to assemble the Collateral and make it
available to the Administrative Agent at the Subsidiary Borrower's sole risk and
expense at a place or places which are reasonably convenient to both the
Administrative Agent and the Subsidiary Borrower.
6.6 The rights, remedies, powers, privileges, and discretions of the
Administrative Agent hereunder (the "Administrative Agent's Rights and
Remedies") shall be cumulative and not exclusive of any rights or remedies which
it would otherwise have. No delay or omission by the Administrative Agent in
exercising or enforcing any of the Administrative Agent's Right and Remedies
shall operate as, or constitute, a waiver thereof. No waiver by the
Administrative Agent of any Event of Default or of any default under any other
agreement shall operate as a waiver of any other default hereunder or under any
other agreement. No single or partial exercise of any of the Administrative
Agent's Rights or Remedies, and no other agreement shall operate as a waiver of
any other default hereunder or under any other agreement or transaction, of
whatever nature entered into between the Administrative Agent and the Subsidiary
Borrower at any time, either express or implied, shall preclude any other or
further exercise of the Administrative Agent's Rights and Remedies. No waiver by
the Administrative Agent of any of the Administrative Agent's Rights and
Remedies on any one occasion shall be deemed a waiver on any subsequent
occasion, nor shall it be deemed a continuing waiver. All of the Administrative
Agent's Right and Remedies may be exercised by the Administrative Agent at such
time or times and in such order of preference as the Administrative Agent in its
sole discretion may determine.
Article VII. General.
7.1 Any and all deposits or other sums at any time credited by or due
to the Subsidiary Borrower from the Administrative Agent or any Bank or lending
affiliates or any bank acting as a participant under any loan arrangement
between the Administrative Agent and the Subsidiary Borrower, and any cash,
securities, instruments, or other property of the Subsidiary Borrower in the
possession of the Administrative Agent, or any Bank or any of its banking or
lending affiliates, and any bank acting as a participant under any loan
arrangement between the Administrative Agent and the Subsidiary Borrower,
whether for safekeeping, or otherwise, or in transit to or from the
Administrative Agent or any Bank or any of its banking or lending affiliates or
any such participant, or in the possession of any third party acting on the
Administrative Agent's or any Bank's behalf (regardless of the reason the
Administrative Agent or any Bank had received same or whether the Administrative
Agent or any Bank has conditionally released the same) shall at all times
constitute security for any and all Liabilities, and may be applied or set off
against such Liabilities at any time after an Event of Default.
7.2 (a) Except as specifically required by this Agreement, the
Subsidiary Borrower WAIVES notice of non-payment, demand, presentment,
protest, and all forms of demand and notice, both with respect to the
Liabilities and the Collateral.
(b) The Subsidiary Borrower, if entitled to it, WAIVES the
right to notice and/or hearing prior to the exercise of the
Administrative Agent's rights upon default.
7.3 The Administrative Agent shall have no duty as to the collection or
protection of the Collateral beyond the safe custody of such of the Collateral
as may come in possession of the Administrative Agent and shall have no duty as
to the preservation of rights against prior parties or any other rights
pertaining thereto. The Administrative Agent's Rights and Remedies may be
exercised without resort or regard to any other source of satisfaction of the
Liabilities.
7.4 All notices, requests and other communications hereunder shall be
given in the manner provided for in the Loan Agreement.
7.5 This Agreement shall be binding upon the Subsidiary Borrower and
the Subsidiary Borrower's successors, and assigns and shall inure to the benefit
of the Administrative Agent and the Administrative Agent's successors and
assigns. In the event that the Administrative Agent assigns or transfers its
rights under this Agreement, the assignee shall thereupon succeed to and become
vested with all rights, powers, privileges, and duties of the Administrative
Agent hereunder and the Administrative Agent shall thereupon be discharged and
relieved from its duties and obligations hereunder.
7.6 Any determination that any provision of this Agreement or any
application thereof is invalid, illegal, or unenforceable in any respect in any
instance shall not affect the validity, legality, and enforceability of such
provision in any other instance, or the validity, legality, or enforceability of
any other provision of this Agreement.
7.7 This Agreement and all other instruments executed in connection
herewith incorporate all discussions and negotiations between the Subsidiary
Borrower and the Administrative Agent, either express or implied, concerning the
matters included herein and in such other instruments, any custom or usage to
the contrary notwithstanding. No such discussions or negotiations shall limit,
modify, or otherwise affect the provisions hereof. No modification, amendment,
or waiver of any provision of this Agreement or of any provision of any other
agreement between the Subsidiary Borrower and the Administrative Agent is
effective unless executed in writing by the party to be charged with such
modification, amendment and waiver, and if such party be the Administrative
Agent, then by a duly authorized officer thereof.
7.8 The proceeds of any collection, sale, or disposition of the
Collateral, or of any other payments received hereunder, shall be applied toward
the Liabilities in such order and manner as the Administrative Agent determines
in its sole discretion, any statute, custom, or usage to the contrary
notwithstanding. The Subsidiary Borrower shall remain liable to the
Administrative Agent for any deficiency remaining following such application.
7.9 The Subsidiary Borrower shall pay on demand all Costs of Collection
and all expenses of the Administrative Agent in connection with the preparation,
execution, and delivery of this Agreement and of any other documents and
agreements between the Subsidiary Borrower and the Administrative Agent, whether
now existing or hereafter arising, and all other expenses which may be incurred
by the Administrative Agent in preparing or amending this Agreement and all
other agreements, instruments, and documents related thereto, or otherwise with
respect to the Liabilities. The Subsidiary Borrower authorizes the
Administrative Agent to pay all such expenses and to charge the same to any
account of the Subsidiary Borrower with the Administrative Agent.
7.10 All amounts which the Administrative Agent may advance under this
Agreement shall be included in the Liabilities, shall be repayable to the
Administrative Agent with interest at the highest pre-default rate charged the
Subsidiary Borrower by the Administrative Agent under the Loan Agreement, on
demand (and if not paid within five (5) days of notice to the Subsidiary
Borrower, at the default rate set forth in subsection 3.4(c) of the Loan
Agreement, and may be charged by the Administrative Agent to any account which
the Subsidiary Borrower maintains with the Administrative Agent.
7.11 This Agreement and all other instruments, documents, and papers
which relate thereto which have been or may be hereinafter furnished the
Administrative Agent may be reproduced by the Administrative Agent by any
photographic, photostatic, microfilm, micro-card, miniature photographic,
xerographic, or similar process, and the Administrative Agent may destroy the
original from which any document was so reproduced. Any such reproduction shall
be admissible in evidence as the original itself in any judicial or
administrative proceeding (whether or not the original is in existence and
whether or not such reproduction was made in the regular course of business).
7.12 This Agreement and all rights and obligations hereunder, including
matters of construction, validity and performance, shall be governed by the laws
of The Commonwealth of Massachusetts. The Subsidiary Borrower submits itself to
the jurisdiction of the Courts of said Commonwealth for all purposes with
respect to this Agreement and the Subsidiary Borrower's relationship with the
Administrative Agent.
7.13 The Subsidiary Borrower shall indemnify, defend, and hold each of
the Agents and the Banks harmless of and from any claim brought or threatened
against any of the Agents or the Banks by the Subsidiary Borrower, any guarantor
or endorser of the Liabilities, or any other person (as well as from attorneys'
reasonable fees and expenses in connection therewith) on account of the
relationship of any of the Agents or the Banks with the Subsidiary Borrower or
any other guarantor or endorser of the Liabilities (each of which may be
defended, compromised, settled, or pursued by the Administrative Agent, for the
benefit of the Banks and the Documentation Agent, with counsel of the
Administrative Agent's selection, but at the expense of the Subsidiary
Borrower). Notwithstanding any other provision of this Agreement, the
indemnification contained herein shall survive payment of the Liabilities and/or
any termination, release, or discharge executed by any of the Agents or the
Banks in favor of the Subsidiary Borrower.
7.14 This Agreement shall remain in full force and effect until
specifically terminated in writing by a duly authorized officer of the
Administrative Agent, or (subject to Section 7.13) until all Liabilities are
paid in full.
7.15 The failure by the Subsidiary Borrower to perform all and singular
the Subsidiary Borrower's obligations hereunder will result in irreparable harm
to the Administrative Agent for which the Administrative Agent will have no
adequate remedy at law. Consequently, such obligations are specifically
enforceable by the Administrative Agent.
7.16 It is intended that:
(a) this Agreement take effect as a sealed instrument;
(b) the security interests created by this Agreement attach to
all of the Subsidiary Borrower's assets now owned or hereafter acquired
which are capable of being subject to a security interest;
(c) the security interests created by this agreement secure all Liabilities
of the Subsidiary Borrower to the Administrative Agent, whether now existing or
hereafter arising;
(d) all costs and expenses incurred by the Administrative
Agent in connection with the Administrative Agent's relationship(s)
with the Subsidiary Borrower shall be borne by the Subsidiary Borrower;
(e) the Administrative Agent's consent to any action of the
Subsidiary Borrower which is prohibited unless such consent is given
may be given or refused by the Administrative Agent in its sole
discretion; and
(f) the Administrative Agent's Rights and Remedies provided herein are
subject to requirements of applicable law.
7.17 The Subsidiary Borrower acknowledges having received a copy of the
within Agreement.
7.18 Any provision contained herein to the contrary notwithstanding:
(i) subject to the subsection (iii) below, the Collateral
hereunder shall not include any contract, agreement or instrument to
the extent that the assignment contemplated hereunder would require the
consent or approval of any third party, or would adversely affect the
enforceability of any such contract, agreement or instrument or the
requirement that the Subsidiary Borrower be paid, repaid or reimbursed
in the event of termination of such contract, agreement or instrument
or would constitute a breach or default under any such contract,
agreement or instrument, unless and until such consent or approval has
been obtained;
(ii) subject to subsection (iii) below, the Collateral
hereunder shall not include any liquor license or any other license the
assignment of which would require the consent or approval of any
governmental authority or agency or other third party unless and until
such consent or approval has been obtained; and
(iii) unless an Event of Default has occurred and the
Liabilities of the Subsidiary Borrower have been accelerated pursuant
to Section 8.2 of the Loan Agreement, the Subsidiary Borrower shall not
be required to obtain or seek to obtain any consent or approval
referred to above.
To the extent that any of the Collateral is further assigned to the
Administrative Agent pursuant to a collateral assignment or other instrument
delivered by the Subsidiary Borrower to the Administrative Agent, then in the
event of any inconsistency with respect to matters relating to such Collateral
between the provisions of such assignment or instrument and the provisions of
this Agreement, the provisions of such Assignment or instrument shall control.
IN WITNESS WHEREOF, the undersigned have executed this Agreement under
seal as of the date first written above.
SUBSIDIARY BORROWER:
WITNESS:
By:
Name Name:
Title:
Its duly authorized officer or agent
ADMINISTRATIVE AGENT:
WITNESS: BANKBOSTON, N.A., AS
ADMINISTRATIVE AGENT
By:
Name Name:
Title:
Its duly authorized officer
<PAGE>
EXHIBIT A
Trade Names: legal status; etc. ('3-3)
<PAGE>
EXHIBIT B
Other Encumbrances and Liens ('3-4)
<PAGE>
EXHIBIT C
Locations ('3-5)
61929_3
EXHIBIT G
FORM OF
SECOND AMENDED AND RESTATED
ASSIGNMENT OF RECEIVABLES AND PROCEEDS
(for Fine Host Corporation)
This SECOND AMENDED AND RESTATED ASSIGNMENT OF RECEIVABLES AND PROCEEDS
(the "Assignment") is made as of July __, 1997, by and between (a) FINE HOST
CORPORATION, a Delaware corporation, with its principal place of business at 3
Greenwich Office Park, Greenwich, Connecticut 06830 (together with its
successors and assigns, "Fine Host"), and (b) BANKBOSTON, N.A., as the
Administrative Agent (in such capacity, the "Administrative Agent") for various
banks and other financial institutions which are or may hereafter become parties
(said banks and other financial institutions are hereinafter referred to
collectively as the "Banks") to that certain Fourth Amended and Restated Loan
Agreement, dated of even date herewith (as the same may be hereafter further
amended, modified, supplemented, extended or restated, from time to time, the
"Loan Agreement") by and among Fine Host, all of the Subsidiaries of Fine Host,
the Administrative Agent, USTrust, as Documentation Agent for the Banks (in such
capacity, the "Documentation Agent")(the Administrative Agent and the
Documentation Agent are hereinafter sometimes referred to collectively as the
"Agents") and the Banks.
All capitalized terms not defined herein but defined in the Loan
Agreement shall have the meanings given to such terms in the Loan Agreement, and
if not defined in the Loan Agreement, then the meanings given to such terms in
the Uniform Commercial Code, as in effect, from time to time, in The
Commonwealth of Massachusetts (the "UCC").
WITNESSETH:
WHEREAS, in connection with the Existing Loan Agreement, Fine Host
entered into, among other things, a certain First Amended and Restated
Assignment of Receivables and Proceeds, dated as of June 25, 1996 (the "Existing
Assignment of Receivables and Proceeds"), by and between Fine Host and USTrust,
as Lender and Agent for the Existing Banks (in such capacity, the "Original
Agent"), pursuant to which, among other things, Fine Host has assigned to the
Original Agent, for the ratable benefit of the Existing Banks, as additional
security all of its rights, title and interests in certain proceeds and
receivables resulting from certain agreements, contracts, permits, licenses and
other arrangements to which Fine Host is or may become a party; and
<PAGE>
WHEREAS, Fine Host and all of its Subsidiaries have requested that the
Existing Banks amend and restate in its entirety the Existing Loan Agreement in
the manner provided in the Loan Agreement; and
WHEREAS, the Agents and all of the Banks which are not Existing Banks
have agreed to become parties to the Loan Agreement; and
WHEREAS, it is a condition precedent to the effectiveness of the Loan
Agreement and to the obligations of the Banks to make Extensions of Credit
provided for therein that Fine Host shall have amended and restated in its
entirety the Existing Assignment of Receivables and Proceeds in the manner
provided herein.
NOW, THEREFORE, in consideration of the premises contained herein, and
to induce the Banks to amend and restate the Existing Loan Agreement, as
provided in the Loan Agreement, and to induce the Banks to make Extensions of
Credit under the Loan Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Fine Host and the
Administrative Agent, for the ratable benefit of the Banks, hereby amend and
restate the Existing Assignment of Receivables and Proceeds to read in its
entirety as follows:
1. To secure the prompt, punctual, and faithful performance by Fine
Host of all of its Liabilities, Fine Host hereby grants, assigns and transfers
to the Administrative Agent, for the ratable benefit of the Banks, and creates
in the Administrative Agent, for the ratable benefit of the Banks, a security
interest in all of the rights, title, and interests of Fine Host in, to and
under the following:
1.1 all proceeds, including but not limited to, Net Contract
Proceeds (collectively, the "Proceeds") resulting from all agreements,
contracts, and permits, licenses, and other arrangements to which Fine
Host is currently or hereafter becomes a party, and pursuant to which,
among other things, Fine Host has agreed (a) to provide food and
beverage services at certain facilities described therein, (b) to
operate and otherwise use food, beverage and liquor licenses at such
facilities, or (c) to manage certain concession and food service areas
at such facilities (including but not limited to, the Facility
Agreements), and all related agreements, contracts, and permits,
licenses, and other arrangements, including but not limited to the
Agreements listed and described on Schedule A attached hereto, which
Schedule A includes all of the material Agreements as of the date of
this Assignment, all as the same may hereafter be modified, amended,
reaffirmed, restated, or extended (collectively, the "Agreements"); and
1.2 all of those certain promissory notes listed on Schedule B
attached hereto and incorporated herein by reference, all as the same
may hereafter be modified, amended, reaffirmed, restated, or extended
and any rights under any Agreement, or promissory notes, bonds, letters
of credit, other agreements and arrangements executed hereafter, in
each case, including but not limited to, the rights of Fine Host to
receive payment in connection or associated with Fine Host incurring
Project Costs pursuant to a Facility Agreement, (collectively, the
"Receivables" and individually a "Receivable"),
subject to Section 5 below, as security only, to have and to hold unto the
Administrative Agent, its successors and assigns, to its and their own use and
benefit, until such time as the Loans (and all other obligations of Fine Host to
the Administrative Agent) shall have been paid and performed in full.
2. Fine Host shall deliver to the Administrative Agent
contemporaneously herewith the originals of all promissory notes which evidence
any Receivables, and each such promissory note shall be endorsed by a duly
authorized officer or agent of Fine Host, in favor of the Administrative Agent,
with full recourse.
3. Fine Host hereby appoints the Administrative Agent as its agent and
attorney with full power of substitution in its name and on its behalf, upon the
occurrence and during the continuance of any Event of Default, to sign, seal,
indorse, complete indorsement, execute and deliver, all such further instruments
of transfer and agreements, supplemental, confirmatory or otherwise, as may be
required for the purpose of more effectively vesting in the Administrative Agent
all of the rights, title, and interests of Fine Host in, to and under the
Receivables; such power of attorney, being coupled with an interest, shall not
be revoked for any reason until all obligations under the Loan Agreement shall
have been paid and performed in full.
4. Fine Host hereby represents, warrants, covenants and agrees at all times
during the term of this Assignment as follows:
a. That Fine Host will perform and observe faithfully and punctually all
obligations, terms, covenants, and conditions set forth in the Loan Documents;
b. That, as of the date hereof, the amount listed on Schedule
C as "Principal Outstanding," "Interest Accrued," and "Total" for each
Receivable is correct, and there are no offsets, defenses or claims by
any payor or indorser under any Receivable which would affect such
amounts or the enforceability of any of the Receivables against any
payor, indorser, or guarantor;
c. That Fine Host is the sole owner of and has not and will not sell,
assign, transfer, mortgage, encumber or pledge all or any portion of its
interest in any of the Proceeds or the Receivables to any person or entity other
than the Administrative Agent;
d. That Fine Host will not cancel, amend, alter, modify,
renew, extend, renegotiate, or terminate any of the Receivables or
Agreements without the prior written consent of the Administrative
Agent, so as to materially and adversely affect the Proceeds; provided,
however, that, prior to the occurrence of any Default, Fine Host may,
without such consent, make or agree to any amendment or modification
that Fine Host reasonably believes is in the best interest of Fine Host
and does not materially affect its ability to make payments required to
be made to the Administrative Agent under the Loan Documents;
e. That Fine Host will take no action associated with the
cancellation, modification, amendment, alteration, renewal, extension,
renegotiation, or termination of any other contract or renegotiation,
or termination of any other contract or agreement of any nature which
would, directly or indirectly, affect the payment terms, amount due, or
enforceability of any Receivables or the Proceeds; provided, however,
that, prior to the occurrence of any Default, Fine Host may, without
such consent, make or agree to any amendment or modification that Fine
Host reasonably believes is in the best interest of Fine Host and does
not materially affect its ability to make payments required to be made
to the Administrative Agent under the Loan Documents;
f. That neither Fine Host nor, to the knowledge of Fine Host,
any other party is in default under or in violation of any of the
terms, covenants, or conditions of any other contract or agreement of
any nature which would, directly or indirectly, materially affect the
payment terms, amount due, or enforceability of any Receivable or the
Proceeds;
g. That Fine Host will promptly upon written request by the
Administrative Agent, execute and deliver and cause to be executed and
delivered all such instruments of pledge or assignment, and such other
instruments or documents as the Administrative Agent may reasonably
request at any time for the purpose of securing or otherwise affecting
its rights hereunder; and
h. That, upon the occurrence and during the continuance of any
Event of Default, Fine Host shall use its best efforts to promptly
cooperate with the Administrative Agent's requests and directions
relating to collection of the Receivables or the Proceeds.
5. Except as provided herein with respect to the Financed Receivables
(as defined below), so long as no Event of Default has occurred and is
continuing, Fine Host shall have the right to exercise all rights and shall be
entitled to receive all payments under the Receivables.
6. Notwithstanding the foregoing Section 5 or anything else herein to
the contrary, Fine Host hereby unconditionally and absolutely assigns to the
Administrative Agent (and not as security only), for the ratable benefit of the
Banks, all of Fine Host's rights, title and interests as payee to receive
payment of all partial or full prepayments, whenever made, of any and all of the
Financed Receivables (collectively, the "Financed Receivables" and individually
a "Financed Receivable"), which Financed Receivables are listed on Schedule C
attached hereto and incorporated herein by reference (provided, however, that
any amounts received from a Financed Receivable related to the Guidance Loans
shall be paid to the Administrative Agent only up to the full unpaid amount of
such Guidance Loans, and promptly distributed, pro rata, to the Banks, to be
applied to the unpaid amount of such Guidance Loans), such assignment being a
present assignment and not an assignment for security only. Any such prepayments
received by Fine Host, whether directly or indirectly (including, without
limitation, offsets against amounts owed by Borrower to such payor under any
other contract or agreement), shall be held in trust by Fine Host for the
Administrative Agent, and shall be paid immediately to the Administrative Agent,
without any requirement for the Administrative Agent to make demand therefor. It
is the intent of Fine Host and the Administrative Agent that this is a present,
unconditional assignment for value, and is not intended as a conditional
assignment for security or otherwise.
7. Notwithstanding the foregoing Section 5 or anything else herein to
the contrary, Fine Host hereby unconditionally and absolutely assigns to the
Administrative Agent (and not as security only), for the ratable benefit of the
Banks, the right to receive payment of all Net Contract Proceeds, whenever made
by any person, to the extent required by subsection 3.1(b) of the Loan
Agreement, such assignment being a present assignment and not an assignment for
security only; provided, however, that the amount so assigned shall be applied
as provided in subsection 3.1(b) of the Loan Agreement, unless an Event of
Default has occurred and is continuing. Any such payments received by Fine Host,
whether directly or indirectly (including, without limitation, offsets against
amounts owed by Fine Host to such person under any other contract or agreement),
shall be held in trust for the Administrative Agent, and shall be paid
immediately to the Administrative Agent, without any requirement for the
Administrative Agent to make demand therefor. It is the intent of Fine Host and
the Administrative Agent that, except as set forth above in this Section, this
is a present, unconditional assignment, for value, and is not intended as a
conditional assignment for security or otherwise.
8. Immediately upon the occurrence and during the continuance of any
Event of Default, Fine Host shall be deemed to hold in trust for the
Administrative Agent any payments received by Fine Host, whether directly or
indirectly (including, without limitation, offsets against amounts owed by Fine
Host to such payor under any other contract or agreement), under any Receivable,
and all such amounts received by Fine Host shall be paid immediately to the
Administrative Agent, without any requirement for the Administrative Agent to
make demand therefor. In addition, and also immediately upon the occurrence and
during the continuance of any Event of Default, the Administrative Agent may, at
its option, exercisable at any time and from time to time, without in any way
waiving such Event of Default, either in person or by agent, with or without
bringing any action or proceeding, exercise and enforce any and all rights as
holder of the Receivables, including, without limitation, the right to complete
the indorsement. In addition to and not in limitation of the foregoing, the
Administrative Agent shall have all the rights and remedies of a secured party
under the UCC with respect to the Notes Receivable. Whenever notice is required
to be given of any public or private sale, such notice shall be deemed to be
reasonable if given at least seven (7) days prior to the date any public sale
shall be held.
9. The Administrative Agent shall not be liable for any loss, claim,
damage, liability or expense which may be sustained or incurred in connection
with any actions or failure to act by the Administrative Agent hereunder, except
losses resulting solely from the gross negligence or willful misconduct of the
Administrative Agent. Fine Host does hereby indemnify, save and hold the
Administrative Agent harmless from and against any and all liability, loss,
claim, damage and expense which may be incurred under or in connection with the
Receivables, or otherwise caused by the negligence or willful misconduct of Fine
Host, its agents, officers, directors, or employees, including, without
limitation, any actions taken or omitted to be taken by the Administrative
Agent, except losses resulting solely from the gross negligence or willful
misconduct of the Administrative Agent. The amount of any such liability, loss,
claim, damage or expense indemnified against shall be deemed to include
reasonable attorneys' fees and other costs of defense, and shall be secured
hereby and by the Loan Documents and be payable by Fine Host to the
Administrative Agent immediately upon demand, or, at the option of the
Administrative Agent, the Administrative Agent may reimburse itself therefor
from any moneys collected by the Administrative Agent hereunder, under the
Receivables, the Proceeds, or under any of the Loan Documents. The
Administrative Agent shall be required to exercise the same standard of care in
dealing with, storing, and safeguarding the Receivables as the Administrative
Agent exercises with similar documents under which the Administrative Agent is
the payee, and Fine Host hereby waives any claims or rights of action against
the Administrative Agent with respect thereto (except with respect to such
standard of care), it being further agreed that the Administrative Agent's
liability with respect to any loss or destruction of any Receivable shall
(except in the case of a breach of such standard of care) be limited to the
Administrative Agent issuing a lost note affidavit with respect to such
Receivable.
10. Failure of the Administrative Agent to avail itself of any of the
terms, covenants and conditions of this Assignment or any act done or omitted to
be done pursuant to the Administrative Agent's powers and rights granted
hereunder shall not be construed or deemed to be a waiver of its rights and
remedies hereunder or under any of the Loan Documents. The rights and remedies
of the Administrative Agent under this Assignment are cumulative and are not in
lieu of but are in addition to any other rights and remedies which the
Administrative Agent shall have under or by virtue of any of the Loan Documents.
The rights and remedies of the Administrative Agent under this Assignment may be
exercised from time to time, as often as their exercise is deemed expedient by
the Administrative Agent and either prior to, simultaneously with or subsequent
to any other action taken by the Administrative Agent, if any, under any of the
Loan Documents. The Administrative Agent may release any party or apply any
other security held by it to the satisfaction of the obligations hereunder and
under any of the Loan Documents without prejudice to any of its rights under
this Assignment.
11. Fine Host hereby agrees to execute and deliver to the
Administrative Agent all such further instruments and documents as from time to
time during the term of this Assignment the Administrative Agent may reasonably
require or deem appropriate in order to more adequately secure the rights
hereunder, including but not limited to, UCC financing statements. The
Administrative Agent may file with the appropriate governmental bodies, as a
financing statement, a carbon, photographic or other reproduction of this
Assignment.
12. If any term or provision of this Assignment or the application
thereof to any person or circumstance shall, to any extent, be invalid or
unenforceable, the remainder of this Assignment or the application of such term
or provision of this Assignment to persons and circumstances other than those as
to which it is held invalid or unenforceable, shall not be affected thereby, and
each such term and provision of this Assignment shall be valid and enforced to
the fullest extent permitted by law.
13. All notices, requests and other communications hereunder shall be given
in the manner provided for in the Loan Agreement.
14. No change, amendment, modification, cancellation or discharge
hereof or any part hereof shall be valid unless Fine Host and the Administrative
Agent shall have consented thereto in writing. Fine Host and the Administrative
Agent may, from time to time, amend any of the Schedules hereto by an amendment
referring to this Assignment and substituting or adding to such Schedule. To the
extent that any provision in this Assignment is inconsistent with any provision
of the Loan Documents, then Fine Host shall be bound by the more restrictive
provision, except in the case of Section 16 hereof. To the extent possible,
however, the provisions of this Assignment and the Loan Documents shall be
interpreted to complement and supplement each other and the absence of any
provision or portion thereof in one such document shall not be deemed to be
inconsistent with the other such documents which contains such provision or
portion thereof.
15. The terms, covenants, and conditions contained herein shall inure
to the benefit of, and bind Fine Host and the Administrative Agent and their
respective successors and assigns. This Assignment shall be construed and
enforced in accordance with and governed by the laws of the Commonwealth of
Massachusetts.
16. (a) Any provision contained herein to the contrary notwithstanding,
if the execution, delivery or performance of this Assignment requires the
consent or approval of any third party, or adversely affects the enforceability
of any Receivable or the requirement that Fine Host be paid, repaid, or
reimbursed in the event of termination of an Agreement, according to its terms,
or constitutes a breach or default under an Agreement, and such consent or
approval has not yet been obtained, then the provisions of this Assignment shall
be deemed to be ineffective and the delivery hereof by the Borrower to the
Administrative Agent shall be made in escrow until such necessary consent or
approval has been obtained, at which time all terms and conditions hereof shall
be and shall be deemed to be in full force and effect, and the Administrative
Agent agrees, in such event and with respect to any such Receivable or Agreement
which could give rise to Proceeds, that Fine Host shall have no obligation to
procure any such consent or approval prior to the occurrence of any Event of
Default or any acceleration of the Loans. The limitations of this paragraph
shall not apply to the extent any Receivable or any Agreement allows the
assignment for security purposes.
(b) Any provision contained herein to the contrary
(i) subject to subsection (ii) below, the Agreements
shall not include any liquor license or any other license the
assignment of which would require the consent or approval of
any governmental authority or agency or other third party
unless and until such consent or approval has been obtained;
and
(ii) unless an Event of Default has occurred and the
Liabilities have been accelerated pursuant to Section 8.2 of
the Loan Agreement, Fine Host shall not be required to obtain
or seek to obtain any consent or approval referred to above.
IN WITNESS WHEREOF, the parties hereto have executed this Assignment as
an instrument under seal as of the date first written above.
WITNESS: FINE HOST CORPORATION
By:
Name Name:
Title:
Its duly authorized officer
WITNESS: BANKBOSTON, N.A., AS
ADMINISTRATIVE AGENT
By:
Name Name:
Title:
Its duly authorized officer
<PAGE>
Schedule A
List of Contracts and Agreements
<PAGE>
Schedule B
List of Receivables
<PAGE>
Schedule C
List of Financed Receivables
64517_3
EXHIBIT H
FORM OF
[SECOND] AMENDED AND RESTATED
ASSIGNMENT OF RECEIVABLES AND PROCEEDS
(for [Name of Joint Venture Subsidiary Borrower])
This [SECOND] AMENDED AND RESTATED ASSIGNMENT OF RECEIVABLES AND
PROCEEDS (the "Assignment") is made as of July __, 1997, by and between (a)
____________________________, a joint venture (together with its successors and
assigns, the "Joint Venture Subsidiary Borrower") which is organized pursuant to
a certain Joint Venture Agreement, dated _______, by and among (i) Fine Host
Corporation, a Delaware corporation (together with its successors and assigns,
"Fine Host"), (ii) _____________________ and (iii) ___________________________,
as subsequently amended from time to time (as so amended, the "Joint Venture
Agreement") and whose principal place of business is at
___________________________________ and (b) BANKBOSTON, N.A., as Administrative
Agent (in such capacity, the "Administrative Agent") for various banks and other
financial institutions which are or may hereafter become parties (said banks and
other financial institutions are hereinafter referred to collectively as the
"Banks") to that certain Fourth Amended and Restated Loan Agreement, dated of
even date herewith (as the same may be hereafter further amended, modified,
supplemented, extended or restated, from time to time, the "Loan Agreement") by
and among Fine Host, all of the Subsidiaries of Fine Host (including without
limitation, the Joint Venture Subsidiary Borrower), the Administrative Agent,
USTrust as Documentation Agent for the Banks (in such capacity, the
"Documentation Agent")(the Administrative Agent and the Documentation Agent are
hereinafter sometimes referred to collectively as the "Agents") and the Banks.
All capitalized terms not defined herein but defined in the Loan
Agreement shall have the meanings given to such terms in the Loan Agreement, and
if not defined in the Loan Agreement, then the meanings given to such terms in
the Uniform Commercial Code, as in effect, from time to time, in The
Commonwealth of Massachusetts (the "UCC").
WITNESSETH:
WHEREAS, in connection with the Existing Loan Agreement, the Joint
Venture Subsidiary Borrower entered into, among other things, a certain [First
Amended and Restated] Assignment of Receivables and Proceeds, dated as of
_____________, 199_ (the "Existing Assignment of Receivables and Proceeds") by
and between the Joint Venture Subsidiary Borrower and USTrust, as Lender and
Agent for the Existing Banks (in such capacity, the "Original Agent"), pursuant
to which, among other things, the Joint Venture Subsidiary Borrower has assigned
to the Original Agent, for the ratable benefit of the Existing Banks, as
additional security all of its rights, title and interests in certain proceeds
and receivables resulting from certain agreements, contracts, permits, licenses
and other arrangements to which the Joint Venture Subsidiary Borrower is or may
become a party; and
WHEREAS, Fine Host and all of its Subsidiaries (including without
limitation, the Joint Venture Subsidiary Borrower) have requested that the
Existing Banks amend and restate in its entirety the Existing Loan Agreement in
the manner provided in the Loan Agreement; and
WHEREAS, the Agents and all of the Banks which are not Existing Banks
have agreed to become parties to the Loan Agreement; and
WHEREAS, it is a condition precedent to the effectiveness of the Loan
Agreement and to the obligations of the Banks to make Extensions of Credit
provided for therein that the Joint Venture Subsidiary Borrower shall have
amended and restated in its entirety the Existing Assignment of Receivables and
Proceeds in the manner provided herein.
NOW, THEREFORE, in consideration of the premises contained herein, and
to induce the Banks to amend and restate the Existing Loan Agreement, as
provided in the Loan Agreement, and to induce the Banks to make Extensions of
Credit under the Loan Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Joint Venture
Subsidiary Borrower and the Administrative Agent, for the ratable benefit of the
Banks, hereby amend and restate the Existing Assignment of Receivables and
Proceeds to read in its entirety as follows:
1. To secure the prompt, punctual, and faithful performance by the
Joint Venture Subsidiary Borrower of all of the Liabilities, the Joint Venture
Subsidiary Borrower hereby grants, assigns and transfers to the Administrative
Agent and creates in the Administrative Agent, for the ratable benefit of the
Banks, a security interest in all of the rights, title, and interests of the
Joint Venture Subsidiary Borrower in, to and under the following:
1.1 all proceeds, including but not limited to, Net Contract
Proceeds (collectively, the "Proceeds") resulting from all agreements,
contracts, and permits, licenses, and other arrangements to which the
Joint Venture Subsidiary Borrower is currently or hereafter becomes a
party, and pursuant to which, among other things, the Joint Venture
Subsidiary Borrower has agreed (a) to provide food and beverage
services at certain facilities described therein, (b) to operate and
otherwise use food, beverage and liquor licenses at such facilities, or
(c) to manage certain concession and food service areas at such
facilities (including but not limited to, the Facility Agreements), and
all related agreements, contracts, and permits, licenses, and other
arrangements, including but not limited to the Agreements listed and
described on Schedule A attached hereto, which Schedule A includes all
of the material Agreements as of the date of this Assignment, all as
the same may hereafter be modified, amended, reaffirmed, restated, or
extended (collectively, the "Agreements"); and
1.2 all of those certain promissory notes listed on Schedule B
attached hereto and incorporated herein by reference, all as the same
may hereafter be modified, amended, reaffirmed, restated, or extended
and any rights under any Agreement, or promissory notes, bonds, letters
of credit, other agreements and arrangements executed hereafter, in
each case, including but not limited to, the rights of the Joint
Venture Subsidiary Borrower to receive payment in connection or
associated with Joint Venture Subsidiary Borrower incurring Project
Costs pursuant to a Facility Agreement, (collectively, the
"Receivables" and individually a "Receivable"),
subject to Section 5 below, as security only, to have and to hold unto the
Administrative Agent, its successors and assigns, to its and their own use and
benefit, until such time as the Loans (and all other obligations of the Joint
Venture Subsidiary Borrower to the Administrative Agent) shall have been paid
and performed in full.
2. The Joint Venture Subsidiary Borrower shall deliver to the
Administrative Agent contemporaneously herewith the originals of all promissory
notes which evidence any Receivables, and each such promissory note shall be
endorsed by a duly authorized officer or agent of the Joint Venture Subsidiary
Borrower, in favor of the Administrative Agent, with full recourse.
3. The Joint Venture Subsidiary Borrower hereby appoints the
Administrative Agent as its agent and attorney with full power of substitution
in its name and on its behalf, upon the occurrence and during the continuance of
any Event of Default, to sign, seal, indorse, complete indorsement, execute and
deliver, all such further instruments of transfer and agreements, supplemental,
confirmatory or otherwise, as may be required for the purpose of more
effectively vesting in the Administrative Agent all of the rights, title, and
interests of the Joint Venture Subsidiary Borrower in, to and under the
Receivables; such power of attorney, being coupled with an interest, shall not
be revoked for any reason until all obligations under the Loan Agreement shall
have been paid and performed in full.
4. The Joint Venture Subsidiary Borrower hereby represents, warrants,
covenants and agrees at all times during the term of this Assignment as follows:
a. That the Joint Venture Subsidiary Borrower will perform and observe
faithfully and punctually all obligations, terms, covenants, and conditions set
forth in the Loan Documents;
b. That, as of the date hereof, the amount listed on Schedule
C as "Principal Outstanding," "Interest Accrued," and "Total" for each
Receivable is correct, and there are no offsets, defenses or claims by
any payor or indorser under any Receivable which would affect such
amounts or the enforceability of any of the Receivables against any
payor, indorser, or guarantor;
c. That the Joint Venture Subsidiary Borrower is the sole owner of and has
not and will not sell, assign, transfer, mortgage, encumber or pledge all or any
portion of its interest in any of the Proceeds or the Receivables to any person
or entity other than the Administrative Agent;
d. That the Joint Venture Subsidiary Borrower will not cancel,
amend, alter, modify, renew, extend, renegotiate, or terminate any of
the Receivables or Agreements without the prior written consent of the
Administrative Agent, so as to materially and adversely affect the
Proceeds; provided, however, that, prior to the occurrence of any
Default, the Joint Venture Subsidiary Borrower may, without such
consent, make or agree to any amendment or modification that the Joint
Venture Subsidiary Borrower reasonably believes is in the best interest
of the Joint Venture Subsidiary Borrower and does not materially affect
its ability to make payments required to be made to the Administrative
Agent under the Loan Documents;
e. That the Joint Venture Subsidiary Borrower will take no
action associated with the cancellation, modification, amendment,
alteration, renewal, extension, renegotiation, or termination of any
other contract or renegotiation, or termination of any other contract
or agreement of any nature which would, directly or indirectly, affect
the payment terms, amount due, or enforceability of any Receivables or
the Proceeds; provided, however, that, prior to the occurrence of any
Default, the Joint Venture Subsidiary Borrower may, without such
consent, make or agree to any amendment or modification that the Joint
Venture Subsidiary Borrower reasonably believes is in the best interest
of the Joint Venture Subsidiary Borrower and does not materially affect
its ability to make payments required to be made to the Administrative
Agent under the Loan Documents;
f. That neither the Joint Venture Subsidiary Borrower nor, to
the knowledge of the Joint Venture Subsidiary Borrower, any other party
is in default under or in violation of any of the terms, covenants, or
conditions of any other contract or agreement of any nature which
would, directly or indirectly, materially affect the payment terms,
amount due, or enforceability of any Receivable or the Proceeds;
g. That the Joint Venture Subsidiary Borrower will promptly
upon written request by the Administrative Agent, execute and deliver
and cause to be executed and delivered all such instruments of pledge
or assignment, and such other instruments or documents as the
Administrative Agent may reasonably request at any time for the purpose
of securing or otherwise affecting its rights hereunder; and
h. That upon the occurrence and during the continuance of any
Event of Default, the Joint Venture Subsidiary Borrower shall use its
best efforts to promptly cooperate with the Administrative Agent's
requests and directions relating to collection of the Receivables or
the Proceeds.
5. Except as provided herein with respect to the Financed Receivables,
so long as no Event of Default has occurred and is continuing, the Joint Venture
Subsidiary Borrower shall have the right to exercise all rights and shall be
entitled to receive all payments under the Receivables.
6. Notwithstanding the foregoing Section 5 or anything else herein to
the contrary, the Joint Venture Subsidiary Borrower hereby unconditionally and
absolutely assigns to the Administrative Agent (and not as security only), for
the ratable benefit of the Banks, all of the Joint Venture Subsidiary Borrower's
rights, title and interests as payee to receive payment of all partial or full
prepayments, whenever made, of any and all of the Financed Receivables
(collectively, the "Financed Receivables" and individually a "Financed
Receivable"), which Financed Receivables are listed on Schedule C attached
hereto and incorporated herein by reference (provided, however, that any amounts
received from a Financed Receivable related to the Guidance Loans shall be paid
to the Administrative Agent only up to the full unpaid amount of such Guidance
Loans, and promptly distributed, pro rata, to the Banks, to be applied to the
unpaid amount of such Guidance Loans), such assignment being a present
assignment and not an assignment for security only. Any such prepayments
received by Joint Venture Subsidiary Borrower, whether directly or indirectly
(including, without limitation, offsets against amounts owed by Joint Venture
Subsidiary Borrower to such payor under any other contract or agreement), shall
be held in trust by Joint Venture Subsidiary Borrower for the Administrative
Agent, and shall be paid immediately to the Administrative Agent, without any
requirement for the Administrative Agent to make demand therefor. It is the
intent of Joint Venture Subsidiary Borrower and the Administrative Agent that
this is a present, unconditional assignment for value, and is not intended as a
conditional assignment for security or otherwise.
7. Notwithstanding the foregoing Section 5 or anything else herein to
the contrary, the Joint Venture Subsidiary Borrower hereby unconditionally and
absolutely assigns to the Administrative Agent (and not as security only), for
the ratable benefit of the Banks, the right to receive payment of all Net
Contract Proceeds, whenever made by any person, to the extent required by
subsection 3.1(b) of the Loan Agreement, such assignment being a present
assignment and not an assignment for security only; provided, however, that the
amount so assigned shall be applied as provided in subsection 3.1(b) of the Loan
Agreement, unless an Event of Default has occurred and is continuing. Any such
payments received by Joint Venture Subsidiary Borrower, whether directly or
indirectly (including, without limitation, offsets against amounts owed by Joint
Venture Subsidiary Borrower to such person under any other contract or
agreement), shall be held in trust for the Administrative Agent, and shall be
paid immediately to the Administrative Agent, without any requirement for the
Administrative Agent to make demand therefor. It is the intent of Joint Venture
Subsidiary Borrower and the Administrative Agent that, except as set forth above
in this Section, this is a present, unconditional assignment, for value, and is
not intended as a conditional assignment for security or otherwise.
8. Immediately upon the occurrence and during the continuance of any
Event of Default, the Joint Venture Subsidiary Borrower shall be deemed to hold
in trust for the Administrative Agent any payments received by Joint Venture
Subsidiary Borrower, whether directly or indirectly (including, without
limitation, offsets against amounts owed by Joint Venture Subsidiary Borrower to
such payor under any other contract or agreement), under any Receivable, and all
such amounts received by Joint Venture Subsidiary Borrower shall be paid
immediately to the Administrative Agent, without any requirement for the
Administrative Agent to make demand therefor. In addition, and also immediately
upon the occurrence and during the continuance of any Event of Default, the
Administrative Agent may, at its option, exercisable at any time and from time
to time, without in any way waiving such Event of Default, either in person or
by agent, with or without bringing any action or proceeding, exercise and
enforce any and all rights as holder of the Receivables, including, without
limitation, the right to complete the indorsement. In addition to and not in
limitation of the foregoing, the Administrative Agent shall have all the rights
and remedies of a secured party under the Uniform Commercial Code, as adopted in
the Commonwealth of Massachusetts in Massachusetts General Laws, Chapter 106,
Section 1-101, et seq. ("UCC") with respect to the Notes Receivable. Whenever
notice is required to be given of any public or private sale, such notice shall
be deemed to be reasonable if given at least seven (7) days prior to the date
any public sale shall be held.
9. The Administrative Agent shall not be liable for any loss, claim,
damage, liability or expense which may be sustained or incurred in connection
with any actions or failure to act by the Administrative Agent hereunder, except
losses resulting solely from the gross negligence or willful misconduct of the
Administrative Agent. The Joint Venture Subsidiary Borrower does hereby
indemnify, save and hold the Administrative Agent harmless from and against any
and all liability, loss, claim, damage and expense which may be incurred under
or in connection with the Receivables, or otherwise caused by the negligence or
willful misconduct of the Joint Venture Subsidiary Borrower, its agents,
officers, directors, or employees, including, without limitation, any actions
taken or omitted to be taken by the Administrative Agent, except losses
resulting solely from the gross negligence or willful misconduct of the
Administrative Agent. The amount of any such liability, loss, claim, damage or
expense indemnified against shall be deemed to include reasonable attorneys'
fees and other costs of defense, and shall be secured hereby and by the Loan
Documents and be payable by the Joint Venture Subsidiary Borrower to the
Administrative Agent immediately upon demand, or, at the option of the
Administrative Agent, the Administrative Agent may reimburse itself therefor
from any moneys collected by the Administrative Agent hereunder, under the
Receivables, the Proceeds, or under any of the Loan Documents. The
Administrative Agent shall be required to exercise the same standard of care in
dealing with, storing, and safeguarding the Receivables as the Administrative
Agent exercises with similar documents under which the Administrative Agent is
the payee, and Joint Venture Subsidiary Borrower hereby waives any claims or
rights of action against the Administrative Agent with respect thereto (except
with respect to such standard of care), it being further agreed that the
Administrative Agent's liability with respect to any loss or destruction of any
Receivable shall (except in the case of a breach of such standard of care) be
limited to the Administrative Agent issuing a lost note affidavit with respect
to such Receivable.
<PAGE>
10. Failure of the Administrative Agent to avail itself of any of the
terms, covenants and conditions of this Assignment or any act done or omitted to
be done pursuant to the Administrative Agent's powers and rights granted
hereunder shall not be construed or deemed to be a waiver of its rights and
remedies hereunder or under any of the Loan Documents. The rights and remedies
of the Administrative Agent under this Assignment are cumulative and are not in
lieu of but are in addition to any other rights and remedies which the
Administrative Agent shall have under or by virtue of any of the Loan Documents.
The rights and remedies of the Administrative Agent under this Assignment may be
exercised from time to time, as often as their exercise is deemed expedient by
the Administrative Agent and either prior to, simultaneously with or subsequent
to any other action taken by the Administrative Agent, if any, under any of the
Loan Documents. The Administrative Agent may release any party or apply any
other security held by it to the satisfaction of the obligations hereunder and
under any of the Loan Documents without prejudice to any of its rights under
this Assignment.
<PAGE>
11. The Joint Venture Subsidiary Borrower hereby agrees to execute and
deliver to the Administrative Agent all such further instruments and documents
as from time to time during the term of this Assignment the Administrative Agent
may reasonably require or deem appropriate in order to more adequately secure
the rights hereunder, including but not limited to, UCC financing statements.
The Administrative Agent may file with the appropriate governmental bodies, as a
financing statement, a carbon, photographic or other reproduction of this
Assignment.
12. If any term or provision of this Assignment or the application
thereof to any person or circumstance shall, to any extent, be invalid or
unenforceable, the remainder of this Assignment or the application of such term
or provision of this Assignment to persons and circumstances other than those as
to which it is held invalid or unenforceable, shall not be affected thereby, and
each such term and provision of this Assignment shall be valid and enforced to
the fullest extent permitted by law.
13. All notices, requests and other communications hereunder shall be given
in the manner provided for in the Loan Agreement.
14. No change, amendment, modification, cancellation or discharge
hereof or any part hereof shall be valid unless the Joint Venture Subsidiary
Borrower and the Administrative Agent shall have consented thereto in writing.
The Joint Venture Subsidiary Borrower and the Administrative Agent may, from
time to time, amend any of the Schedules hereto by an amendment referring to
this Assignment and substituting or adding to such Schedule. To the extent that
any provision in this Assignment is inconsistent with any provision of the Loan
Documents, then the Joint Venture Subsidiary Borrower shall be bound by the more
restrictive provision, except in the case of Section 16 hereof. To the extent
possible, however, the provisions of this Assignment and the Loan Documents
shall be interpreted to complement and supplement each other and the absence of
any provision or portion thereof in one such document shall not be deemed to be
inconsistent with the other such documents which contains such provision or
portion thereof.
<PAGE>
15. The terms, covenants, and conditions contained herein shall inure
to the benefit of, and bind the Joint Venture Subsidiary Borrower and the
Administrative Agent and their respective successors and assigns. This
Assignment shall be construed and enforced in accordance with and governed by
the laws of the Commonwealth of Massachusetts.
16. (a) Any provision contained herein to the contrary notwithstanding,
if the execution, delivery or performance of this Assignment requires the
consent or approval of any third party, or adversely affects the enforceability
of any Receivable or the requirement that Joint Venture Subsidiary Borrower be
paid, repaid, or reimbursed in the event of termination of an Agreement,
according to its terms, or constitutes a breach or default under an Agreement,
and such consent or approval has not yet been obtained, then the provisions of
this Assignment shall be deemed to be ineffective and the delivery hereof by the
Joint Venture Subsidiary Borrower to the Administrative Agent shall be made in
escrow until such necessary consent or approval has been obtained, at which time
all terms and conditions hereof shall be and shall be deemed to be in full force
and effect, and the Administrative Agent agrees, in such event and with respect
to any such Receivable or Agreement which could give rise to Proceeds, that the
Joint Venture Subsidiary Borrower shall have no obligation to procure any such
consent or approval prior to the occurrence of any Event of Default or any
acceleration of the Loans. The limitations of this paragraph shall not apply to
the extent any Receivable or any Agreement allows the assignment for security
purposes.
(b) Any provision contained herein to the contrary
(i) subject to subsection (ii) below, the Agreements
shall not include any liquor license or any other license the
assignment of which would require the consent or approval of
any governmental authority or agency or other third party
unless and until such consent or approval has been obtained;
and
(ii) unless an Event of Default has occurred and the
Liabilities have been accelerated pursuant to Section 8.2 of
the Loan Agreement, the Joint Venture Subsidiary Borrower
shall not be required to obtain or seek to obtain any consent
or approval referred to above.
17. (a) Notwithstanding any other provision contained in this
Assignment to the contrary (including, without limitation, those relating to
indemnification, costs and expenses), the Administrative Agent's sole recourse
against the Joint Venture Subsidiary Borrower under this Assignment for payment
of the Liabilities and for all other payments due hereunder shall be against the
Receivables, the Financed Receivables, the Proceeds, the Net Proceeds and all of
the other Joint Venture Collateral of the Joint Venture Subsidiary Borrower, and
the Joint Venture Subsidiary Borrower shall not be liable for any unpaid
Liabilities or any such other amount to the extent that the proceeds of the sale
or other disposition of the Receivables, the Financed Receivables, the Proceeds,
the Net Proceeds and all such other Joint Venture Collateral are insufficient to
pay such amounts; provided, however, that notwithstanding the foregoing to the
contrary, the Joint Venture Subsidiary Borrower shall be liable to the
Administrative Agent in its individual capacity for any loss, expense, claim or
damage suffered by the Administrative Agent as a result of the breach by the
Joint Venture Subsidiary Borrower of any of its representations, warranties or
covenants contained in this Assignment or any of the other Loan Documents (other
than the Loan Agreement) to which it is a party; provided further, however, that
the foregoing provisions of this subsection (a) shall in no way be deemed to
affect (i) any of the liabilities and obligations of any of the Borrowers (other
than the Joint Venture Subsidiary Borrower) under this Assignment or any of the
other Loan Documents; or (ii) the rights or interests of the Administrative
Agent in and to the Receivables, the Financed Receivables, the Proceeds or the
Net Proceeds and such other Joint Venture Collateral of the Joint Venture
Subsidiary Borrower or any part thereof or any other rights or remedies of the
Administrative Agent under this Assignment or any of the other Loan Documents
with respect to the Receivables, the Financed Receivables, the Proceeds or the
Net Proceeds and all such other Joint Venture Collateral or under any other
document, agreement or instrument securing the Liabilities.
(b) Notwithstanding any term or provision contained herein or in any of
the other Loan Documents to the contrary (including, without limitation, those
relating to indemnification, costs and expenses), the Administrative Agent's
sole recourse hereunder for payment of the Liabilities and for all other
payments due hereunder shall be against the assets of the Joint Venture
Subsidiary Borrower as and to the extent provided in the preceding subsection
(a), and the Administrative Agent shall have no recourse for any such payment
against any of the Joint Venturers of the Joint Venture Subsidiary Borrower
(other than Fine Host) or any of their assets, notwithstanding that any of the
Joint Venturers might otherwise be liable for obligations of the Joint Venture
Subsidiary Borrower under applicable law, the organizational documents of the
Joint Venture Subsidiary Borrower or otherwise; provided, however, that the
foregoing provisions of this subsection (b) shall in no way be deemed to affect
(i) any of the liabilities and obligations of any of the Borrowers (other than
the Joint Venture Subsidiary Borrower) under this Assignment or any of the other
Loan Documents; or (ii) the rights or interests of the Administrative Agent in
and to the Receivables, the Financed Receivables, the Proceeds or the Net
Proceeds and all of the other Joint Venture Collateral of the Joint Venture
Subsidiary Borrower or any part thereof or any other rights or remedies of the
Administrative Agent under this Assignment or any of the other Loan Documents
with respect to the Receivables, the Financed Receivables, the Proceeds or the
Net Proceeds and all such other Joint Venture Collateral or under any other
document, agreement or instrument securing the Liabilities. In the event of any
inconsistency between the provisions of this subsection (b) and the provisions
of any of the other Loan Documents (including, without limitations, provisions
relating to joint and several liability or liability on the part of any Person
comprising part of another Person), the provisions of this subsection (b) shall
control.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Assignment as
an instrument under seal on the date and year first written above.
JOINT VENTURE SUBSIDIARY BORROWER:
WITNESS: [Name of Joint Venture Subsidiary Borrower]
By:
Name Name:
Title:
Its duly authorized officer or agent
ADMINISTRATIVE AGENT:
WITNESS:
BANKBOSTON, N.A., AS
ADMINISTRATIVE AGENT
By:
Name Name:
Title:
Its duly authorized officer
<PAGE>
Schedule A
List of Contracts and Agreements
<PAGE>
Schedule B
List of Receivables
<PAGE>
Schedule C
List of Financed Receivables
61938_3
EXHIBIT I
FORM OF
[SECOND] AMENDED AND RESTATED
ASSIGNMENT OF RECEIVABLES AND PROCEEDS
(for [Name of Subsidiary Borrower])
This [SECOND] AMENDED AND RESTATED ASSIGNMENT OF RECEIVABLES AND
PROCEEDS (the "Assignment") is made as of this July __, 1997, by and between (a)
_________________________, a ____________________, with its principal place of
business at __________________________________ (together with its successors and
assigns, the "Subsidiary Borrower"), and (b) BANKBOSTON, N.A., as Administrative
Agent (in such capacity, the "Administrative Agent") for various banks and other
financial institutions which are or may hereafter become parties (said banks and
other financial institutions are hereinafter referred to collectively as the
"Banks") to that certain Fourth Amended and Restated Loan Agreement, dated of
even date herewith (as the same may be hereafter further amended, modified,
supplemented, extended or restated, from time to time, the "Loan Agreement") by
and among Fine Host Corporation, a Delaware corporation (together with its
successors and assigns, "Fine Host"), all of the Subsidiaries of Fine Host
(including without limitation, the Subsidiary Borrower), the Administrative
Agent, USTrust, as Documentation Agent for the Banks (in such capacity, the
"Documentation Agent")(the Administrative Agent and the Documentation Agent are
hereinafter sometimes referred to collectively as the "Agents") and the Banks.
All capitalized terms not defined herein but defined in the Loan
Agreement shall have the meanings given to such terms in the Loan Agreement, and
if not defined in the Loan Agreement, then the meanings given to such terms in
the Uniform Commercial Code, as in effect, from time to time, in The
Commonwealth of Massachusetts (the "UCC").
WITNESSETH:
WHEREAS, in connection with the Existing Loan Agreement, the Subsidiary
Borrower entered into, among other things, a certain [First Amended and
Restated] Assignment of Receivables and Proceeds, dated as of _____________,
199_ (the "Existing Assignment of Receivables and Proceeds"), by and between the
Subsidiary Borrower and USTrust, as Lender and Agent for the Existing Banks (in
such capacity, the "Original Agent"), pursuant to which, among other things, the
Subsidiary Borrower has assigned to the Original Agent, for the ratable benefit
of the Existing Banks, as additional security all of its rights, title and
interests in certain proceeds and receivables resulting from certain agreements,
contracts, permits, licenses and other arrangements to which the Subsidiary
Borrower is or may become a party; and
<PAGE>
WHEREAS, Fine Host Corporation and all of its Subsidiaries (including
without limitation, the Subsidiary Borrower) have requested that the Existing
Banks amend and restate in its entirety the Existing Loan Agreement in the
manner provided in the Loan Agreement; and
WHEREAS, the Agents and all of the Banks which are not Existing Banks
have agreed to become parties to the Loan Agreement; and
WHEREAS, it is a condition precedent to the effectiveness of the Loan
Agreement and to the obligations of the Banks to make Extensions of Credit
provided for therein that the Subsidiary Borrower shall have amended and
restated in its entirety the Existing Assignment of Receivables and Proceeds in
the manner provided herein.
NOW, THEREFORE, in consideration of the premises contained herein, and
to induce the Banks to amend and restate the Existing Loan Agreement, as
provided in the Loan Agreement, and to induce the Banks to make Extensions of
Credit under the Loan Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Subsidiary
Borrower and the Administrative Agent, for the ratable benefit of the Banks,
hereby amend and restate the Existing Assignment of Receivables and Proceeds to
read in its entirety as follows:
1. To secure the prompt, punctual, and faithful performance by the
Subsidiary Borrower of all of the Liabilities, the Subsidiary Borrower hereby
grants, assigns and transfers to the Administrative Agent, for the ratable
benefit of the Banks, and creates in the Administrative Agent, for the ratable
benefit of the Banks, a security interest in all of the rights, title, and
interests of the Subsidiary Borrower in, to and under the following:
1.1 all proceeds, including but not limited to, Net Contract
Proceeds (collectively, the "Proceeds") resulting from all agreements,
contracts, and permits, licenses, and other arrangements to which the
Subsidiary Borrower is currently or hereafter becomes a party, and
pursuant to which, among other things, the Subsidiary Borrower has
agreed (a) to provide food and beverage services at certain facilities
described therein, (b) to operate and otherwise use food, beverage and
liquor licenses at such facilities, or (c) to manage certain concession
and food service areas at such facilities (including but not limited
to, the Facility Agreements), and all related agreements, contracts,
and permits, licenses, and other arrangements, including but not
limited to the Agreements listed and described on Schedule A attached
hereto, which Schedule A includes all of the material Agreements as of
the date of this Assignment, all as the same may hereafter be modified,
amended, reaffirmed, restated, or extended (collectively, the
"Agreements"); and
1.2 all of those certain promissory notes listed on Schedule B
attached hereto and incorporated herein by reference, all as the same
may hereafter be modified, amended, reaffirmed, restated, or extended
and any rights under any Agreement, or promissory notes, bonds, letters
of credit, other agreements and arrangements executed hereafter, in
each case, including but not limited to, the rights of the Subsidiary
Borrower to receive payment in connection or associated with the
Subsidiary Borrower incurring Project Costs pursuant to a Facility
Agreement, (collectively, the "Receivables" and individually a
"Receivable"),
subject to Section 5 below, as security only, to have and to hold unto the
Administrative Agent, its successors and assigns, to its and their own use and
benefit, until such time as the Loans (and all other obligations of the
Subsidiary Borrower to the Administrative Agent) shall have been paid and
performed in full.
2. The Subsidiary Borrower shall deliver to the Administrative Agent
contemporaneously herewith the originals of all promissory notes which evidence
any Receivables, and each such promissory note shall be endorsed by a duly
authorized officer or agent of the Subsidiary Borrower, in favor of the
Administrative Agent, with full recourse.
3. The Subsidiary Borrower hereby appoints the Administrative Agent as
its agent and attorney with full power of substitution in its name and on its
behalf, upon the occurrence and during the continuance of any Event of Default,
to sign, seal, indorse, complete indorsement, execute and deliver, all such
further instruments of transfer and agreements, supplemental, confirmatory or
otherwise, as may be required for the purpose of more effectively vesting in the
Administrative Agent all of the rights, title, and interests of the Subsidiary
Borrower in, to and under the Receivables; such power of attorney, being coupled
with an interest, shall not be revoked for any reason until all obligations
under the Loan Agreement shall have been paid and performed in full.
4. The Subsidiary Borrower hereby represents, warrants, covenants and
agrees at all times during the term of this Assignment as follows:
a. That the Subsidiary Borrower will perform and observe faithfully and
punctually all obligations, terms, covenants, and conditions set forth in the
Loan Documents;
b. That, as of the date hereof, the amount listed on Schedule
C as "Principal Outstanding," "Interest Accrued," and "Total" for each
Receivable is correct, and there are no offsets, defenses or claims by
any payor or indorser under any Receivable which would affect such
amounts or the enforceability of any of the Receivables against any
payor, indorser, or guarantor;
c. That the Subsidiary Borrower is the sole owner of and has not and will
not sell, assign, transfer, mortgage, encumber or pledge all or any portion of
its interest in any of the Proceeds or the Receivables to any person or entity
other than the Administrative Agent;
d. That the Subsidiary Borrower will not cancel, amend, alter,
modify, renew, extend, renegotiate, or terminate any of the Receivables
or Agreements without the prior written consent of the Administrative
Agent, so as to materially and adversely affect the Proceeds; provided,
however, that, prior to the occurrence of any Default, the Subsidiary
Borrower may, without such consent, make or agree to any amendment or
modification that the Subsidiary Borrower reasonably believes is in the
best interest of the Subsidiary Borrower and does not materially affect
its ability to make payments required to be made to the Administrative
Agent under the Loan Documents;
e. That the Subsidiary Borrower will take no action associated
with the cancellation, modification, amendment, alteration, renewal,
extension, renegotiation, or termination of any other contract or
renegotiation, or termination of any other contract or agreement of any
nature which would, directly or indirectly, affect the payment terms,
amount due, or enforceability of any Receivables or the Proceeds;
provided, however, that, prior to the occurrence of any Default, the
Subsidiary Borrower may, without such consent, make or agree to any
amendment or modification that the Subsidiary Borrower reasonably
believes is in the best interest of the Subsidiary Borrower and does
not materially affect its ability to make payments required to be made
to the Administrative Agent under the Loan Documents;
f. That neither the Subsidiary Borrower nor, to the knowledge
of the Subsidiary Borrower, any other party is in default under or in
violation of any of the terms, covenants, or conditions of any other
contract or agreement of any nature which would, directly or
indirectly, materially affect the payment terms, amount due, or
enforceability of any Receivable or the Proceeds;
g. That the Subsidiary Borrower will promptly upon written
request by the Administrative Agent, execute and deliver and cause to
be executed and delivered all such instruments of pledge or assignment,
and such other instruments or documents as the Administrative Agent may
reasonably request at any time for the purpose of securing or otherwise
affecting its rights hereunder; and
h. That upon the occurrence and during the continuance of any
Event of Default, the Subsidiary Borrower shall use its best efforts to
promptly cooperate with the Administrative Agent's requests and
directions relating to collection of the Receivables or the Proceeds.
5. Except as provided herein with respect to the Financed Receivables
(as defined below), so long as no Event of Default has occurred and is
continuing, the Subsidiary Borrower shall have the right to exercise all rights
and shall be entitled to receive all payments under the Receivables.
6. Notwithstanding the foregoing Section 5 or anything else herein to
the contrary, the Subsidiary Borrower hereby unconditionally and absolutely
assigns to the Administrative Agent (and not as security only), for the ratable
benefit of the Banks, all of the Subsidiary Borrower's rights, title and
interests as payee to receive payment of all partial or full prepayments,
whenever made, of any and all of the Financed Receivables (collectively, the
"Financed Receivables" and individually a "Financed Receivable"), which Financed
Receivables are listed on Schedule C attached hereto and incorporated herein by
reference (provided, however, that any amounts received from a Financed
Receivable related to the Guidance Loans shall be paid to the Administrative
Agent only up to the full unpaid amount of such Guidance Loans, and promptly
distributed, pro rata, to the Banks, to be applied to the unpaid amount of such
Guidance Loans), such assignment being a present assignment and not an
assignment for security only. Any such prepayments received by the Subsidiary
Borrower, whether directly or indirectly (including, without limitation, offsets
against amounts owed by the Subsidiary Borrower to such payor under any other
contract or agreement), shall be held in trust by the Subsidiary Borrower for
the Administrative Agent, and shall be paid immediately to the Administrative
Agent, without any requirement for the Administrative Agent to make demand
therefor. It is the intent of the Subsidiary Borrower and the Administrative
Agent that this is a present, unconditional assignment for value, and is not
intended as a conditional assignment for security or otherwise.
7. Notwithstanding the foregoing Section 5 or anything else herein to
the contrary, the Subsidiary Borrower hereby unconditionally and absolutely
assigns to the Administrative Agent (and not as security only), for the ratable
benefit of the Banks, the right to receive payment of all Net Contract Proceeds,
whenever made by any person, to the extent required by subsection 3.1(b) of the
Loan Agreement, such assignment being a present assignment and not an assignment
for security only; provided, however, that the amount so assigned shall be
applied as provided in subsection 3.1(b) of the Loan Agreement, unless an Event
of Default has occurred and is continuing. Any such payments received by the
Subsidiary Borrower, whether directly or indirectly (including, without
limitation, offsets against amounts owed by the Subsidiary Borrower to such
person under any other contract or agreement), shall be held in trust for the
Administrative Agent, and shall be paid immediately to the Administrative Agent,
without any requirement for the Administrative Agent to make demand therefor. It
is the intent of the Subsidiary Borrower and the Administrative Agent that,
except as set forth above in this Section, this is a present, unconditional
assignment, for value, and is not intended as a conditional assignment for
security or otherwise.
8. Immediately upon the occurrence and during the continuance of any
Event of Default, the Subsidiary Borrower shall be deemed to hold in trust for
the Administrative Agent any payments received by the Subsidiary Borrower,
whether directly or indirectly (including, without limitation, offsets against
amounts owed by the Subsidiary Borrower to such payor under any other contract
or agreement), under any Receivable, and all such amounts received by the
Subsidiary Borrower shall be paid immediately to the Administrative Agent,
without any requirement for the Administrative Agent to make demand therefor. In
addition, and also immediately upon the occurrence and during the continuance of
any Event of Default, the Administrative Agent may, at its option, exercisable
at any time and from time to time, without in any way waiving such Event of
Default, either in person or by agent, with or without bringing any action or
proceeding, exercise and enforce any and all rights as holder of the
Receivables, including, without limitation, the right to complete the
indorsement. In addition to and not in limitation of the foregoing, the
Administrative Agent shall have all the rights and remedies of a secured party
under the UCC with respect to the Notes Receivable. Whenever notice is required
to be given of any public or private sale, such notice shall be deemed to be
reasonable if given at least seven (7) days prior to the date any public sale
shall be held.
9. The Administrative Agent shall not be liable for any loss, claim,
damage, liability or expense which may be sustained or incurred in connection
with any actions or failure to act by the Administrative Agent hereunder, except
losses resulting solely from the gross negligence or willful misconduct of the
Administrative Agent. The Subsidiary Borrower does hereby indemnify, save and
hold the Administrative Agent harmless from and against any and all liability,
loss, claim, damage and expense which may be incurred under or in connection
with the Receivables, or otherwise caused by the negligence or willful
misconduct of the Subsidiary Borrower, its agents, officers, directors, or
employees, including, without limitation, any actions taken or omitted to be
taken by the Administrative Agent, except losses resulting solely from the gross
negligence or willful misconduct of the Administrative Agent. The amount of any
such liability, loss, claim, damage or expense indemnified against shall be
deemed to include reasonable attorneys' fees and other costs of defense, and
shall be secured hereby and by the Loan Documents and be payable by the
Subsidiary Borrower to the Administrative Agent immediately upon demand, or, at
the option of the Administrative Agent, the Administrative Agent may reimburse
itself therefor from any moneys collected by the Administrative Agent hereunder,
under the Receivables, the Proceeds, or under any of the Loan Documents. The
Administrative Agent shall be required to exercise the same standard of care in
dealing with, storing, and safeguarding the Receivables as the Administrative
Agent exercises with similar documents under which the Administrative Agent is
the payee, and the Subsidiary Borrower hereby waives any claims or rights of
action against the Administrative Agent with respect thereto (except with
respect to such standard of care), it being further agreed that the
Administrative Agent's liability with respect to any loss or destruction of any
Receivable shall (except in the case of a breach of such standard of care) be
limited to the Administrative Agent issuing a lost note affidavit with respect
to such Receivable.
10. Failure of the Administrative Agent to avail itself of any of the
terms, covenants and conditions of this Assignment or any act done or omitted to
be done pursuant to the Administrative Agent's powers and rights granted
hereunder shall not be construed or deemed to be a waiver of its rights and
remedies hereunder or under any of the Loan Documents. The rights and remedies
of the Administrative Agent under this Assignment are cumulative and are not in
lieu of but are in addition to any other rights and remedies which the
Administrative Agent shall have under or by virtue of any of the Loan Documents.
The rights and remedies of the Administrative Agent under this Assignment may be
exercised from time to time, as often as their exercise is deemed expedient by
the Administrative Agent and either prior to, simultaneously with or subsequent
to any other action taken by the Administrative Agent, if any, under any of the
Loan Documents. The Administrative Agent may release any party or apply any
other security held by it to the satisfaction of the obligations hereunder and
under any of the Loan Documents without prejudice to any of its rights under
this Assignment.
11. The Subsidiary Borrower hereby agrees to execute and deliver to the
Administrative Agent all such further instruments and documents as from time to
time during the term of this Assignment the Administrative Agent may reasonably
require or deem appropriate in order to more adequately secure the rights
hereunder, including but not limited to, UCC financing statements. The
Administrative Agent may file with the appropriate governmental bodies, as a
financing statement, a carbon, photographic or other reproduction of this
Assignment.
12. If any term or provision of this Assignment or the application
thereof to any person or circumstance shall, to any extent, be invalid or
unenforceable, the remainder of this Assignment or the application of such term
or provision of this Assignment to persons and circumstances other than those as
to which it is held invalid or unenforceable, shall not be affected thereby, and
each such term and provision of this Assignment shall be valid and enforced to
the fullest extent permitted by law.
13. All notices, requests and other communications hereunder shall be given
in the manner provided for in the Loan Agreement.
14. No change, amendment, modification, cancellation or discharge
hereof or any part hereof shall be valid unless the Subsidiary Borrower and the
Administrative Agent shall have consented thereto in writing. The Subsidiary
Borrower and the Administrative Agent may, from time to time, amend any of the
Schedules hereto by an amendment referring to this Assignment and substituting
or adding to such Schedule. To the extent that any provision in this Assignment
is inconsistent with any provision of the Loan Documents, then the Subsidiary
Borrower shall be bound by the more restrictive provision, except in the case of
Section 16 hereof. To the extent possible, however, the provisions of this
Assignment and the Loan Documents shall be interpreted to complement and
supplement each other and the absence of any provision or portion thereof in one
such document shall not be deemed to be inconsistent with the other such
documents which contains such provision or portion thereof.
15. The terms, covenants, and conditions contained herein shall inure
to the benefit of, and bind the Subsidiary Borrower and the Administrative Agent
and their respective successors and assigns. This Assignment shall be construed
and enforced in accordance with and governed by the laws of the Commonwealth of
Massachusetts.
16. (a) Any provision contained herein to the contrary notwithstanding,
if the execution, delivery or performance of this Assignment requires the
consent or approval of any third party, or adversely affects the enforceability
of any Receivable or the requirement that the Subsidiary Borrower be paid,
repaid, or reimbursed in the event of termination of an Agreement, according to
its terms, or constitutes a breach or default under an Agreement, and such
consent or approval has not yet been obtained, then the provisions of this
Assignment shall be deemed to be ineffective and the delivery hereof by the
Subsidiary Borrower to the Administrative Agent shall be made in escrow until
such necessary consent or approval has been obtained, at which time all terms
and conditions hereof shall be and shall be deemed to be in full force and
effect, and the Administrative Agent agrees, in such event and with respect to
any such Receivable or Agreement which could give rise to Proceeds, that the
Subsidiary Borrower shall have no obligation to procure any such consent or
approval prior to the occurrence of any Event of Default or any acceleration of
the Loans. The limitations of this paragraph shall not apply to the extent any
Receivable or any Agreement allows the assignment for security purposes.
(b) Any provision contained herein to the contrary
(i) subject to subsection (ii) below, the Agreements
shall not include any liquor license or any other license the
assignment of which would require the consent or approval of
any governmental authority or agency or other third party
unless and until such consent or approval has been obtained;
and
(ii) unless an Event of Default has occurred and the
Liabilities have been accelerated pursuant to Section 8.2 of
the Loan Agreement, the Subsidiary Borrower shall not be
required to obtain or seek to obtain any consent or approval
referred to above.
[THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK]
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Assignment as
an instrument under seal as of date first written above.
SUBSIDIARY BORROWER:
WITNESS: [Name of Subsidiary Borrower]
By:
Name Name:
Title:
Its duly authorized officer or agent
ADMINISTRATIVE AGENT:
WITNESS: BANKBOSTON, N.A., AS ADMINISTRATIVE AGENT
By:
Name: Name:
Title:
Its duly authorized officer
<PAGE>
Schedule A
List of Contracts and Agreements
<PAGE>
Schedule B
List of Receivables
<PAGE>
Schedule C
List of Financed Receivables
<PAGE>
EXHIBIT J
FORM OF
THIRD AMENDED AND RESTATED
STOCK PLEDGE AGREEMENT
This THIRD AMENDED AND RESTATED STOCK PLEDGE AGREEMENT (the
"Agreement") is made as of July __, 1997, by and between (a) FINE HOST
CORPORATION, a Delaware corporation with its principal office at 3 Greenwich
Office Park, Greenwich, Connecticut 06830 (together with its successors and
assigns, "Fine Host"), and (b) BANKBOSTON, N.A., as Administrative Agent (in
such capacity, the "Administrative Agent") for various banks and other financial
institutions which are or may hereafter become parties (said banks and other
financial institutions are hereinafter referred to collectively as the "Banks")
to that certain Fourth Amended and Restated Loan Agreement, dated of even date
herewith (as the same may be hereafter further amended, modified, supplemented,
extended or restated, from time to time, the "Loan Agreement") by and among Fine
Host, all of the Subsidiaries of Fine Host, the Administrative Agent, USTrust,
as Documentation Agent for the Banks (in such capacity, the "Documentation
Agent")(the Administrative Agent and the Documentation Agent are hereinafter
sometimes referred to collectively as the "Agents") and the Banks.
All capitalized terms not defined herein but defined in the Loan
Agreement shall have the meanings given to such terms in the Loan Agreement, and
if not defined in the Loan Agreement, then the meanings given to such terms in
the Uniform Commercial Code, as in effect, from time to time, in The
Commonwealth of Massachusetts (the "UCC").
WITNESSETH:
WHEREAS, in connection with the Existing Loan Agreement, Fine Host
entered into, among other things, a certain Second Amended and Restated Stock
Pledge Agreement, dated as of June __, 1997 (the "Existing Stock Pledge
Agreement"), by and between Fine Host and USTrust, as Lender and Agent for the
Existing Banks (in such capacity, the "Original Agent"), pursuant to which,
among other things, Fine Host granted to the Original Agent, for the ratable
benefit of the Existing Banks, a security interest in all of the shares of
capital stock owned by Fine Host in the following corporations (said
corporations are hereinafter referred to collectively as the "Corporate
Subsidiary Borrowers" and each singly as a "Corporate Subsidiary Borrower"), to
secure all of the obligations and liabilities of Fine Host to the Existing
Banks, all as more particularly described therein: (i) Fine Host Services
Corporation, a Delaware corporation, (ii) Fine Host of Vermont, Inc., a Vermont
corporation, (iii) Fanfare, Inc., a Massachusetts corporation, (iv) Global
Fanfare, Inc., an Indiana corporation, (v) Fine Host International Corporation,
a Delaware corporation, (vi) Creative Food Management, Inc., an Ohio corporation
(f/k/a VGE Acquisition Corp.), (vii) Northwest Food Service, Inc., an Idaho
corporation, (viii) Southwest Food Service, Inc., a New Mexico corporation, (ix)
Republic Management Corp. of Massachusetts, a Massachusetts corporation, (x)
Versatile Holding Corporation, a Delaware corporation, (xi) Ideal Management
Services, Inc., a New York corporation, (xii) Service Dynamics Corp., a New
Jersey corporation, and (xiii) PCS Holding Corp., a North Carolina corporation
(f/k/a HCS Management Corp.); and
WHEREAS, Fine Host and all of its Subsidiaries (including without
limitation, the Corporate Subsidiary Borrowers) have requested that the Existing
Banks amend and restate in its entirety the Existing Loan Agreement in the
manner provided in the Loan Agreement; and
WHEREAS, the Agents and all of the Banks which are not Existing Banks
have agreed to become parties to the Loan Agreement; and
WHEREAS, it is a condition precedent to the effectiveness of the Loan
Agreement and to the obligations of the Banks to make Extensions of Credit
provided for therein that Fine Host shall have amended and restated in its
entirety the Existing Stock Pledge Agreement in the manner provided herein.
NOW, THEREFORE, in consideration of the premises contained herein, and
to induce the Banks, the Administrative Agent and the Documentation Agent to
amend and restate the Existing Loan Agreement, as provided in the Loan
Agreement, and to induce the Banks to make Extensions of Credit under the Loan
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Fine Host and the Administrative
Agent, for the ratable benefit of the Banks, hereby amend and restate the
Existing Stock Pledge Agreement to read in its entirety as follows:
1. The Collateral. Fine Host hereby represents, warrants and
covenants to the Administrative Agent that:
1.1 Fine Host is the record and legal owner of all of the
issued and outstanding shares (collectively, the "Shares") of capital
stock of each of the Corporate Subsidiary Borrowers, all as more
particular described in Exhibit A attached hereto and incorporated
herein by reference;
1.2 The Shares are free and clear of all pledges, liens,
claims, charges, encumbrances and restrictions other than the pledge
and security interest from Fine Host to the Administrative Agent
granted hereunder; and
1.3 Fine Host has and will have power, authority and legal
right to pledge and grant a security interest in and to the Collateral
(as defined below).
Fine Host hereby agrees to defend the Administrative Agent's rights and
security interest in the Collateral. The Shares, together with any rights
thereunder and all proceeds therefrom, including without limitation, dividends
(cash or stock), income, interest, earnings, profits and other distributions
thereunder, whether now owned or hereafter acquired, are hereinafter referred to
collectively as the "Collateral."
2. Administrative Agent and Security Interest. Fine Host hereby pledges
and grants to the Administrative Agent, for the ratable benefit of the Banks, a
continuing security interest in all of the Collateral, as security for payment
and performance of all of the Liabilities (as defined in the Loan Agreement) of
Fine Host to the Agents and the Banks. In case Fine Host shall hereafter acquire
(i) any additional shares of the capital stock of any of the Corporate
Subsidiary Borrowers or any corporation which may the successor of any of the
Corporate Subsidiary Borrowers, (ii) any warrants or options for the purchase of
shares of such capital stock of any class of any of the Corporate Subsidiary
Borrowers or (ii) any securities exchangeable for or convertible into shares of
such capital stock of any class of any of the Corporate Subsidiary Borrowers, by
purchase or otherwise, then Fine Host shall forthwith deliver to and pledge such
shares or other securities to the Administrative Agent under this Agreement.
3. Custody of Collateral. Fine Host has delivered herewith to the
Administrative Agent all of the certificates and instruments evidencing the
Shares. Fine Host acknowledges that the Administrative Agent holds the Shares
hereunder, for the ratable benefit of the Banks, and as designee of Fine Host,
to hold the Shares for the purpose of perfecting the Administrative Agent's
security interest in the Shares.
4. Dividends and Voting While No Event of Default. So long as no Event
of Default has occurred and is continuing (or if continuing has been effectively
waived by the Administrative Agent in writing), Fine Host, as to the Shares,
shall be entitled (subject specifically to the provisions and restrictions
contained in the Loan Agreement and the rights of the Administrative Agent under
the Loan Documents): to (a) receive any cash dividends which are permitted under
the Loan Agreement and which are paid in respect of the Shares (all stock
dividends shall be promptly and directly delivered to the Administrative Agent);
(b) vote the Shares (to the extent otherwise entitled thereto); and (c) give
consents, waivers and ratifications in respect of the Shares; provided, however,
that no vote shall be cast or consent, waiver or ratification given or action
taken which would be inconsistent with or violate any provision of the Loan
Agreement or the Loan Documents. All such rights of Fine Host to vote and give
consents, waivers and ratification with respect to the Shares shall, at the
Administrative Agent's option as evidenced by the Administrative Agent's
notifying Fine Host of such election, cease in case a Default or an Event of
Default shall have occurred and be continuing.
5. Remedies Following Event of Default. If an Event of Default shall
occur and be continuing, the Administrative Agent shall thereafter have the
following rights and remedies (to the extent permitted by applicable law) in
addition to the rights and remedies of a secured party under the UCC, all such
rights and remedies being cumulative, not exclusive, and enforceable
alternately, successively or concurrently, at such time or times as the
Administrative Agent deems expedient:
(a) if the Administrative Agent so elects and gives notice of
such election to Fine Host, the Administrative Agent may vote any or
all Shares (whether or not the same shall have been transferred into
its name or the name of its nominee or nominees) and give all consents,
waivers and ratification in respect of the stock and otherwise act with
respect thereto as though it was the outright owner thereof (Fine Host
hereby irrevocably appoints the Administrative Agent the proxy and
attorney-in-fact of Fine Host, with full power of substitution, to do
so);
(b) the Administrative Agent may demand, sue for, collect or make any
compromises or settlement which it deems suitable in respect of the Collateral;
(c) the Administrative Agent may sell, resell, assign and
deliver or otherwise dispose of any or all of the Collateral, for cash
or credit or both and upon such terms, at such place or places and at
such time or times and to such persons as the Administrative Agent
deems expedient, all without demand for performance by Fine Host or any
notice or advertisement whatsoever except such as may be required by
law; and
(d) the Administrative Agent may cause all or any part of the Collateral
held by it to be transferred into its name or the name of its nominee or
nominees.
Fine Host recognizes that the Administrative Agent may be unable to
effect a public sale of the Shares by reason of certain prohibitions contained
in the Securities Act of 1933, as amended, or any applicable state securities
laws, but may be compelled to resort to one or more private sales thereof to a
restricted group of purchasers who will be obliged to agree, among other things,
to acquire such securities for their own account, for investment and not with a
view to the distribution or resale thereof. Fine Host agrees that any such
private sales may be at prices and on other reasonable terms less favorable to
the seller than if sold at public sales and that such private sales shall be
deemed to have been made in a commercially reasonable manner. The Administrative
Agent shall be under no obligation to delay a sale of any of the Shares for the
period of time necessary to permit the issuer of such securities to register
such securities for public sale under the Securities Act of 1933, as amended,
even if the issuer would agree to do so.
Fine Host hereby agrees that the sending of ten (10) days' notice by
certified mail return receipt requested, postage prepaid, to Fine Host's address
set forth at the head of this Agreement of the place and time of any public sale
or of the time after which any private sale or other intended disposition is to
be made, shall be deemed reasonable notice thereof. To the extent permitted by
law, the Administrative Agent may enforce its rights hereunder without any other
notice and without compliance with any other condition precedent now or
hereafter imposed by statute, rule of law or otherwise (all of which are hereby
expressly waived by Fine Host). If any of the Collateral is sold by the
Administrative Agent upon credit or for future delivery, the Administrative
Agent shall not be liable for the failure of the purchaser to pay for the same
and in such event the Administrative Agent may resell such Collateral. The
Administrative Agent may buy any part or all of the Collateral at any public
sale and if any part or all of the Collateral is of a type customarily sold in a
recognized market or is of the type which is the subject of widely-distributed
standard price quotations, the Administrative Agent may buy at private sale and
may make payments thereof by any means. The Administrative Agent may apply the
cash proceeds actually received from any sale or other disposition to the
reasonable expenses of retaking, holding, preparing for sale, selling and the
like, to reasonable attorneys' fees and all legal expenses, travel and other
expenses which may be incurred by the Administrative Agent in attempting to
collect the Liabilities, or any of them, or to enforce this Agreement or in the
prosecution or defense of any action or proceeding related to the subject matter
of this Agreement; and then to the Liabilities in such order as to principal or
interest remaining unpaid, including legal interest thereon, and the balance of
any expenses unpaid, as the Administrative Agent in it sole discretion may
reasonably determine, and any surplus shall be paid to Fine Host.
The Administrative Agent understands that certain state liquor laws
that now or may in the future be applicable to Fine Host may require that
certain approvals be obtained, or certain filings be made or notices given,
prior to the time at which (i) the Shares may be transferred into the name of
the Administrative Agent or its nominee or (ii) the Administrative Agent may
exercise control with respect to the Shares if related liquor licenses are to
remain in effect.
6. Costs; Legal Fees. Fine Host agrees to pay, or to reimburse the
Agents and the Banks, as the case may be, on demand, for all fees, costs and
expenses (including reasonable legal fees, costs and expenses) incurred or paid
by any of the Agents and the Banks in connection with: (a) the collection of the
Liabilities or the enforcement of the Administrative Agent's rights and remedies
under this Agreement; (b) the administration, supervision, protection of or
realization on any of the Collateral held as security for any of the
Liabilities; or (c) the defense of any action against any of the Agents or the
Banks with respect to the Administrative Agent's rights or remedies in respect
to the Collateral; and all of the foregoing fees, costs, and expenses shall be
part of the Liabilities secured by this Agreement, and may be paid by the
Administrative Agent, acting in its sole discretion, and added to the
Liabilities, in each case, whether or not any suit or other legal proceedings
are commenced or pending.
7. Marshalling. The Administrative Agent shall not be required to
marshall any present or future security for (including but not limited to this
Agreement and the Collateral) the Liabilities or any of them or to resort to
such security in any particular order; and all of its rights hereunder and in
respect of such security shall be cumulative and in addition to all other
rights, however existing or arising. To the extent that it lawfully may, Fine
Host hereby agrees that it will not invoke any law which might cause delay in or
impede the enforcement of the Administrative Agent's rights under this Agreement
or under any other instrument evidencing any of the Liabilities or under which
any of the Liabilities is outstanding or by which any of the Liabilities is
secured or guaranteed, and Fine Host hereby irrevocably waives the benefits of
all such laws.
8. Fine Host's Liabilities Not Affected. The Liabilities of Fine Host
hereunder shall remain in full force and effect without regard to, and shall not
be impaired by, (a) any exercise or nonexercise, or any waiver, by the
Administrative Agent of any right, remedy, power or privilege under or in
respect of any of the Liabilities or any security therefor (including this
Agreement), (b) any amendment or waiver of any of the terms of the Liabilities
of Fine Host to the Administrative Agent and the security therefor, (c) any
amendment or waiver of any of the terms of any instrument (other than this
Agreement) providing security for any of the Liabilities, or (d) the taking of
additional security for any guaranty of any of the Liabilities or the release or
discharge or termination of any security or guaranty for any of the Liabilities;
whether or not Fine Host shall have notice or knowledge of any of the foregoing.
9. Transfers By Fine Host. Without the prior written consent of the
Administrative Agent, Fine Host will not sell, assign, transfer or otherwise
dispose of, grant any option with respect to, or pledge or grant any security
interest in or otherwise encumber or restrict any of the Collateral or any
interest therein, except as provided for in this Agreement.
10. Further Assurances. Fine Host will do all such acts, and will
furnish to the Administrative Agent all such financing statements, certificates,
opinions and other documents and will do or cause to be done all such other
things as the Administrative Agent may reasonably request from time to time in
order to give full effect to this Agreement and to secure the rights of the
Administrative Agent hereunder.
11. Administrative Agent's Exoneration. Under no circumstances shall
the Administrative Agent be deemed to assume any responsibility for or
obligation or duty (except for safe custody) with respect to any part or all of
the Collateral delivered hereunder, of any nature or kind or any matter or
proceedings arising out of or relating thereto, but the same shall be at Fine
Host's sole risk at all times, excepting only the Administrative Agent's gross
negligence or wilful misconduct. The Administrative Agent shall not be required
to take any action of any kind to collect, preserve or protect its or Fine
Host's rights in the Collateral against any parties thereto. Fine Host hereby
releases the Administrative Agent from any claims, causes of action and demands
at any time arising out of or with respect to this Agreement, the Liabilities,
the use of the Collateral and/or any actions reasonably taken or omitted to be
taken by the Administrative Agent with respect thereto, and Fine Host hereby
agrees to hold the Administrative Agent harmless from and with respect to any
and all such claims, causes of action and demands, excepting only those claims,
causes of action and demands attributable to the Administrative Agent's gross
negligence or wilful misconduct.
12. No Waiver. No act, failure or delay by the Administrative Agent
shall constitute a waiver of its rights and remedies hereunder or otherwise. No
single or partial waiver by the Administrative Agent of any default or right or
remedy which it may have shall operate as a waiver of any other default, right
or remedy or of the same default, right or remedy on a future occasion. Fine
Host hereby waives presentment, notice of dishonor and protest of all
instruments included in or evidencing any of the Liabilities or the Collateral,
and any and all other notices and demand whatsoever.
13. Notices. All notices, requests and other communications hereunder shall
be given in the manner provided for in the Loan Agreement.
14. Miscellaneous Provisions. Neither this Agreement nor any term
hereof may be changed, waived, discharged or terminated except by a written
instrument expressly referring to this Agreement and to the provisions so
modified or limited, and executed by the party to be charged. This Agreement and
all obligations of Fine Host hereunder shall be binding upon the successors in
title and assigns of Fine Host, and shall, together with the rights and remedies
of the Administrative Agent hereunder, inure to the benefit of the
Administrative Agent, its successors in title and assigns. This Agreement and
obligations of Fine Host hereunder shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts. The descriptive
section headings have been inserted for convenience of reference only and do not
define or limit the provisions hereof. If any term of this Agreement shall be
held to be invalid, illegal or unenforceable the validity of all other terms
hereof shall be in no way affected hereby and this Agreement shall be construed
and be enforceable as if such invalid, illegal or unenforceable term had not
been included herein.
[THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK]
<PAGE>
IN WITNESS WHEREOF, the Administrative Agent and Fine Host have caused
this Agreement to be duly executed and delivered under seal as of the date first
above written.
WITNESS: FINE HOST CORPORATION
_________________________ By:____________________________________
Name: Name:
Title:
Its duly authorized officer
WITNESS: BANKBOSTON, N.A., AS
ADMINISTRATIVE AGENT
_________________________ By:________________________________
Name: Name:
Title:
Its duly authorized officer
<PAGE>
Exhibit A
<TABLE>
<CAPTION>
==========================================================================================================================
SHARES
======= ================================================ --------------------------- ------------------ ==================
Item Certificate
No. Issuer Type of Stock No. of Shares No(s).
Issued
<C> <C> <C>
<S> <C>
======= ================================================ --------------------------- ------------------ ==================
1. Fine Host Services Corporation Common stock, 100 1
without par value
======= ================================================ --------------------------- ------------------ ==================
2. Fine Host of Vermont, Inc. Common stock, 100 5
without par value
======= ================================================ --------------------------- ------------------ ==================
3. Fanfare, Inc. Common stock, 2,000 11
without par value
======= ================================================ --------------------------- ------------------ ==================
4. Global Fanfare, Inc. Common Stock, 400 10
without par value
======= ================================================ --------------------------- ------------------ ==================
5. Fine Host International Corporation Common Stock, 100 1
without par value
======= ================================================ --------------------------- ------------------ ==================
6. Creative Food Management, Inc. Common Stock, 75 5
without par value
======= ================================================ --------------------------- ------------------ ==================
7. Northwest Food Service, Inc. Common Stock, 820 15
without par value
======= ================================================ --------------------------- ------------------ ==================
8. Sun West Services, Inc. Class A Common Stock, 25,000 4
with $.01 par value per
share
======= ================================================ --------------------------- ------------------ ==================
9. Republic Management Corp. of Massachusetts Common Stock, 184,000
without par value
======= ================================================ --------------------------- ------------------ ==================
10. Republic Management Corp. of Massachusetts Class A Common Stock, 136,000
without par value
======= ================================================ --------------------------- ------------------ ==================
11. Republic Management Corp. of Massachusetts Class B Common Stock, 80,000
without par value
======= ================================================ --------------------------- ------------------ ==================
12. Versatile Holding Corporation Class A 6,500
Common Stock,
with $.01 par value
per share
======= ================================================ --------------------------- ------------------ ==================
13. Versatile Holding Corporation Class B 3,000
Common Stock,
with $.01 par value
per share
======= ================================================ --------------------------- ------------------ ==================
14. Ideal Management Services, Inc. Common Stock, 20
without par value
======= ================================================ --------------------------- ------------------ ==================
15. Service Dynamics Corp. Common Stock, 100
without par value
======= ================================================ --------------------------- ------------------ ==================
16 PCS Holding Corp. (f/k/a HCS Management Corp.) Class A Voting Common 375
Stock,
with $1.00 par value per
share
======= ================================================ =========================== ================== ==================
17. PCS Holding Corp. (f/k/a HCS Management Corp.) Nonvoting Preferred 460,000
Stock,
with $1.00 par value per
share
======= ================================================ =========================== ================== ==================
</TABLE>
EXHIBIT K
FORM OF
SECOND AMENDED AND RESTATED LLC PLEDGE
AGREEMENT (for Membership Interest in Tarrant County
Concessions, L.L.C.)
This SECOND AMENDED AND RESTATED LLC PLEDGE AGREEMENT (the "Agreement")
is made as of July __, 1997, by and between (a) FINE HOST CORPORATION, a
Delaware corporation with a principal office at 3 Greenwich Office Park,
Greenwich, Connecticut 06830 ("Fine Host") and (b) BANKBOSTON, N.A., as
Administrative Agent (in such capacity, the "Administrative Agent") for various
banks and other financial institutions which are or may hereafter become parties
(said banks and other financial institutions are hereinafter referred to
collectively as the "Banks") to that certain Fourth Amended and Restated Loan
Agreement, dated of even date herewith (as the same may be hereafter further
amended, modified, supplemented, extended or restated, from time to time, the
"Loan Agreement") by and among Fine Host, all of the Subsidiaries of Fine Host,
the Administrative Agent, USTrust as Documentation Agent for the Banks (in such
capacity, the "Documentation Agent")(the Administrative Agent and the
Documentation Agent are hereinafter sometimes referred to collectively as the
"Agents") and the Banks.
All capitalized terms not defined herein but defined in the Loan
Agreement shall have the meanings given to such terms in the Loan Agreement, and
if not defined in the Loan Agreement, then the meanings given to such terms in
the Uniform Commercial Code, as in effect, from time to time, in The
Commonwealth of Massachusetts (the "UCC").
WITNESSETH:
WHEREAS, in connection with the Existing Loan Agreement, Fine Host
entered into, among other things, a certain Pledge Agreement, dated as of June
25, 1996, by and between Fine Host and USTrust, as Lender and Agent for the
Existing Banks (in such capacity, the "Original Agent"), as subsequently amended
from time to time (as so amended, the "Existing Pledge Agreement"), pursuant to
which, among other things, Fine Host granted in favor of the Original Agent for
the ratable benefit of the Existing Banks, a security interest in all of the
rights, title and interests of Fine Host's membership interest in Tarrant County
Concessions, L.L.C., a Texas limited liability company (the "LLC Subsidiary
Borrower"), all in order to secure all of the obligations and liabilities of
Fine Host to the Existing Banks; and
WHEREAS, Fine Host and all of its Subsidiaries (including without
limitation, the LLC Subsidiary Borrower) have requested that the Existing Banks
amend and restate in its entirety the Existing Loan Agreement in the manner
provided in the Loan Agreement; and
WHEREAS, the Agents and all of the Banks which are not Existing Banks
have agreed to become parties to the Loan Agreement;
WHEREAS, it is a condition precedent to the effectiveness of the Loan
Agreement and to the obligations of the Banks to make Extensions of Credit
provided for therein that Fine Host shall have amended and restated in its
entirety the Existing Pledge Agreement in the manner provided herein; and
NOW, THEREFORE, in consideration of the premises contained herein, and
to induce the Banks to amend and restate the Existing Loan Agreement, as
provided in the Loan Agreement, and to induce the Banks to make Extensions of
Credit under the Loan Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Fine Host and the
Administrative Agent, for the ratable benefit of the Banks, hereby amend and
restate the Existing Pledge Agreement to read in its entirety as follows:
1. Pledge And Grant of Security Interest in Collateral. To secure all
of the Liabilities of Fine Host to the Administrative Agent under the Loan
Agreement and the other Loan Documents, Fine Host hereby pledges, assigns,
grants to the Administrative Agent, for the ratable benefit of the Banks, a
continuing first priority security interest in the following, in each case
whether now owned or hereafter acquired, issued or arising (collectively, the
"Collateral"):
(a) all of Fine Host's Membership Interest in the LLC
Subsidiary Borrower, whether now existing or hereafter arising
(hereinafter referred to as the "Membership Interest");
(b) all payments, earnings, dividends (whether cash or in
kind, including any dividends of additional Membership Interest) and
other distributions (including but not limited to, all distribution of
assets or property of the LLC Subsidiary Borrower in the event of a
liquidation or winding up of the LLC Subsidiary Borrower or otherwise)
received by the LLC Subsidiary Borrower with respect to the Membership
Interest;
(c) all rights, interests, and remedies available to Fine Host
pursuant to any of the foregoing, including but not limited to any
voting or other rights arising from the Membership Interest, and under
applicable law; and
(d) all proceeds, substitutions, accessions, and replacements
(including any securities or other property in exchange therefore) of
any of the foregoing.
2. UCC-1 Financing Statements; Certificates.
2.1 UCC-1 Financing Statements. Fine Host shall execute and
deliver contemporaneously herewith to the Administrative Agent certain
UCC-1 Financing Statements, in form satisfactory to the Administrative
Agent, and will pay all costs associated with filing the same in all
public offices wherever filing is deemed by the Administrative Agent to
be necessary, desirable or otherwise appropriate.
2.2 Certificates. If, at any time, the Membership Interest
shall be represented by one or more membership interest certificates or
other certificates of ownership or any other documents, Fine Host shall
promptly deliver such certificates, or other documents to the
Administrative Agent, accompanied by transfer powers endorsed in blank
respecting such certificates or documents, duly executed, with
signatures guaranteed if requested by the Administrative Agent.
3. Representations, Warranties and Covenants. Fine Host hereby
represents, warrants and covenants to the Administrative Agent
the following:
3.1 Locations; Supplemental Information Regarding Fine Host.
Fine Host's principal place of business, chief executive office and
mailing address is located at the address set forth at the beginning of
this Agreement, and Fine Host does not and will not conduct any
business under any trade name or trade style other than Fine Host's
legal name or such other names or styles as may be set forth in the
Loan Agreement or any of the other Loan Documents.
3.2 Title To Collateral. Fine Host has good and marketable
title to the Membership Interest, subject to no pledges, liens,
security interests, charges, options, restrictions or other
encumbrances except the pledge and security interest created by this
Agreement.
3.3 Authority. Fine Host has full power, authority and legal
right to execute, deliver and perform its obligations under this
Agreement and to pledge and grant a security interest in all of the
Collateral pursuant to this Agreement, and the execution, delivery and
performance hereof and the pledge of and granting of a security
interest in the Collateral hereunder do not contravene any law, rule or
regulation or any judgment, decree or order of any tribunal or of any
agreement or instrument to which Fine Host is a party or by which Fine
Host or Fine Host's property is bound or affected or constitute a
default thereunder. Fine Host covenants that Fine Host will defend the
Administrative Agent's rights and security interest in the Membership
Interest against the claims and demands of all persons whomsoever.
3.4 Transfers By Fine Host. Fine Host will not sell, assign,
transfer or otherwise dispose of, grant any option with respect to, or
pledge or grant any security interest in or otherwise encumber or
restrict any of the Collateral or any interest therein, except as
provided for in this Agreement.
4. No Liability As Member. The foregoing pledge and security interest
is for collateral purposes only and, to the fullest extent permitted by law, the
Administrative Agent shall not, either by virtue hereof or by its receipt of
distributions from or by virtue of the exercise of any of its rights hereunder,
be deemed to be a member of the LLC Subsidiary Borrower or to have any liability
for the debts, obligations or liabilities of the LLC Subsidiary Borrower, Fine
Host or any other participant in the LLC Subsidiary Borrower, or to have any
obligation to make capital contributions to, perform any services for, or
discharge any duties of a member of the LLC Subsidiary Borrower.
5. Liquidation and Recapitalization.
5.1 Any sums or other property paid or distributed upon or
with respect to the Membership Interest, whether by dividend or
redemption or upon the liquidation or dissolution of the LLC Subsidiary
Borrower, shall, except to the limited extent provided in Section 6, be
paid over and delivered to the Administrative Agent to be held by the
Administrative Agent as security for the payment and performance in
full of all of the Liabilities. In case, pursuant to the
recapitalization or reclassification of the LLC Subsidiary Borrower or
pursuant to the reorganization thereof, any distribution of capital
shall be made on or in respect of any of the Membership Interest or any
property shall be distributed upon or with respect to any of the
Membership Interest, the property so distributed shall be delivered to
the Administrative Agent to be held by it as security for the
Liabilities. Except to the limited extent provided in Section 6, all
sums of money and property paid or distributed in respect of the
Membership Interest, whether as a dividend or upon such a liquidation,
dissolution, recapitalization or reclassification or otherwise, that
are received by Fine Host shall, until paid or delivered to the
Administrative Agent, be held in trust for the Administrative Agent as
security for the payment and performance in full of all of the
Liabilities.
5.2 All sums of money that are delivered to the Administrative
Agent pursuant to this Section 5 shall be deposited into an interest
bearing account in the name of the Administrative Agent (the "Cash
Collateral Account"). Some or all of the funds from time to time in the
Cash Collateral Account may be invested in time deposits, certificates
of deposit issued by a bank, or U.S. government obligations (such time
deposits, certificates of deposit or U.S. Government obligations being
hereinafter referred to, collectively, as "Cash Amounts"), that are
satisfactory to both the Administrative Agent and Fine Host. Interest
earned on the Cash Collateral Account and on the Cash Amounts shall be
deposited in the Cash Collateral Account. The Cash Collateral Account,
all sums from time to time standing to the credit of the Cash
Collateral Account, any and all Cash Amounts, any and all instruments
or other writings evidencing Cash Amounts and any and all proceeds or
any thereof are hereinafter referred to as the "Cash Collateral."
5.3 Fine Host shall have no right to withdraw sums from the
Cash Collateral Account, to receive any of the Cash Collateral or to
require the Administrative Agent to part with the Administrative
Agent's possession of any instruments or other writings evidencing any
Cash Amounts.
6. Distributions and Voting Prior to Event of Default. So long as no
Event of Default shall have occurred and be continuing, Fine Host shall be
entitled to receive all cash dividends and distributions paid in respect of the
Membership Interest, to vote the Membership Interest and to give consents,
waivers and ratifications in respect of the Membership Interest; provided,
however, that no vote shall be cast or consent, waiver or ratification given by
Fine Host if the effect thereof would or be inconsistent with or result in any
violation of any of the provisions of the Loan Agreement or this Agreement. All
such rights of Fine Host to receive cash dividends and distributions shall cease
in case any Event of Default shall have occurred and be continuing. All such
rights of Fine Host to vote and give consents, waivers and ratifications with
respect to the Membership Interest shall, at the Administrative Agent's option,
as evidenced by the Administrative Agent's notifying Fine Host of such election,
cease in case any Event of Default shall have occurred and be continuing.
7. Remedies Following Event of Default. If any Event of Default shall
occur and be continuing, the Administrative Agent shall thereafter have the
following rights and remedies (to the extent permitted by applicable law) in
addition to the rights and remedies of a secured party under the UCC, all such
rights and remedies being cumulative, not exclusive, and enforceable
alternately, successively or concurrently, at such time or times as the
Administrative Agent deems expedient:
(a) if the Administrative Agent so elects and gives notice of
such election to Fine Host, the Administrative Agent may vote any or
all of the Membership Interest (whether or not the same shall have been
transferred into its name or the name of its nominee or nominees) and
give all consents, waivers and ratification in respect of the
Membership Interest and otherwise act with respect thereto as though it
was the outright owner thereof (Fine Host hereby irrevocably appoints
the Administrative Agent the proxy and attorney-in-fact of Fine Host,
with full power of substitution, to do so);
(b) the Administrative Agent may demand, sue for, collect or make any
compromises or settlement which it deems suitable in respect of the Collateral;
(c) the Administrative Agent may sell, resell, assign and
deliver or otherwise dispose of any or all of the Collateral, for cash
or credit or both and upon such terms, at such place or places and at
such time or times and to such persons as the Administrative Agent
deems expedient, all without demand for performance by Fine Host or any
notice or advertisement whatsoever except such as may be required by
law; and
(d) the Administrative Agent may cause all or any part of the Collateral
held by it to be transferred into its name or the name of its nominee or
nominees.
Fine Host recognizes that the Administrative Agent may be unable to
effect a public sale of the Membership Interest by reason of certain
prohibitions contained in the Securities Act of 1933, as amended, or any
applicable state securities laws, but may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers who will be obliged to
agree, among other things, to acquire such securities for their own account, for
investment and not with a view to the distribution or resale thereof. Fine Host
agrees that any such private sales may be at prices and on other reasonable
terms less favorable to the seller than if sold at public sales and that such
private sales shall be deemed to have been made in a commercially reasonable
manner. The Administrative Agent shall be under no obligation to delay a sale of
any of the Membership Interest for the period of time necessary to permit the
issuer of such securities to register such securities for public sale under the
Securities Act of 1933, as amended, even if the issuer would agree to do so.
Fine Host hereby agrees that the sending of ten (10) days' notice by
certified mail return receipt requested, postage prepaid, to Fine Host's address
set forth at the head of this Agreement of the place and time of any public sale
or of the time after which any private sale or other intended disposition is to
be made, shall be deemed reasonable notice thereof. To the extent permitted by
law, the Administrative Agent may enforce its rights hereunder without any other
notice and without compliance with any other condition precedent now or
hereafter imposed by statute, rule of law or otherwise (all of which are hereby
expressly waived by Fine Host). If any of the Collateral is sold by the
Administrative Agent upon credit or for future delivery, the Administrative
Agent shall not be liable for the failure of the purchaser to pay for the same
and in such event the Administrative Agent may resell such Collateral. The
Administrative Agent may buy any part or all of the Collateral at any public
sale and if any part or all of the Collateral is of a type customarily sold in a
recognized market or is of the type which is the subject of widely-distributed
standard price quotations, the Administrative Agent may buy at private sale and
may make payments thereof by any means. The Administrative Agent may apply the
cash proceeds actually received from any sale or other disposition to the
reasonable expenses of retaking, holding, preparing for sale, selling and the
like, to reasonable attorneys' fees and all legal expenses, travel and other
expenses which may be incurred by the Administrative Agent in attempting to
collect the Liabilities, or any of them, or to enforce this Agreement or in the
prosecution or defense of any action or proceeding related to the subject matter
of this Agreement; and then to the Liabilities in such order as to principal or
interest remaining unpaid, including legal interest thereon, and the balance of
any expenses unpaid, as the Pledge in it sole discretion may reasonably
determine, and any surplus shall be paid to Fine Host.
The Administrative Agent understands that certain state liquor laws
that now or may in the future be applicable to Fine Host may require that
certain approvals be obtained, or certain filings be made or notices given,
prior to the time at which (i) the Membership Interest may be transferred into
the name of the Administrative Agent or its nominee or (ii) the Administrative
Agent may exercise control with respect to the Membership Interest if related
liquor licenses are to remain in effect.
8. Costs; Legal Fees. Fine Host agrees to pay, or to reimburse the
Agents and the Banks, as the case may be, on demand, for all fees, costs and
expenses (including reasonable legal fees, costs and expenses) incurred or paid
by any of the Agents and the Banks in connection with: (a) the collection of the
Liabilities or the enforcement of the Administrative Agent's rights and remedies
under this Agreement; (b) the administration, supervision, protection of or
realization on any of the Collateral held as security for any of the
Liabilities; or (c) the defense of any action against any of the Agents or the
Banks with respect to the Administrative Agent's rights or remedies in respect
to the Collateral; and all of the foregoing fees, costs, and expenses shall be
part of the Liabilities secured by this Agreement, and may be paid by the
Administrative Agent, acting in its sole discretion, and added to the
Liabilities, in each case, whether or not any suit or other legal proceedings
are commenced or pending.
9. Marshalling. The Administrative Agent shall not be required to
marshall any present or future security for (including but not limited to this
Agreement and the Collateral) the Liabilities or any of them or to resort to
such security in any particular order; and all of its rights hereunder and in
respect of such security shall be cumulative and in addition to all other
rights, however existing or arising. To the extent that it lawfully may, Fine
Host hereby agrees that it will not invoke any law which might cause delay in or
impede the enforcement of the Administrative Agent's rights under this Agreement
or under any other instrument evidencing any of the Liabilities or under which
any of the Liabilities is outstanding or by which any of the Liabilities is
secured or guaranteed, and Fine Host hereby irrevocably waives the benefits of
all such laws.
10. Fine Host's Liabilities Not Affected. The obligations of Fine Host
hereunder shall remain in full force and effect without regard to, and shall not
be impaired by (a) any exercise or nonexercise, or any waiver, by the
Administrative Agent of any right, remedy, power or privilege under or in
respect of any of the Liabilities or any security thereof (including this
Agreement); (b) any amendment to or modification of the Loan Agreement or any of
the Liabilities; (c) any amendment to or modification of any instrument (other
than this Agreement) securing any of the Liabilities; or (d) the taking of
additional security for, or any other assurances of payment of, any of the
Liabilities or the release or discharge or termination of any security or other
assurances of payment or performance for any of the Liabilities; whether or not
Fine Host shall have notice or knowledge of any of the foregoing.
11. Further Assurances. Fine Host will do all such acts, and will
furnish to the Administrative Agent all such financing statements, certificates,
legal opinions and other documents and will obtain all such governmental
consents and corporate approvals and will do or cause to be done all such other
things as the Administrative Agent may reasonably request from time to time in
order to give full effect to this Agreement and to secure the rights of the
Administrative Agent hereunder. If the Administrative Agent so elects, a
photocopy of this Agreement may at any time and from time to time be filed by
the Administrative Agent as a financing statement in any recording office in any
jurisdiction.
12. Administrative Agent's Exoneration. Under no circumstances shall
the Administrative Agent be deemed to assume any responsibility for or
obligation or duty with respect to any part or all of the Collateral of any
nature or kind or any matter or proceedings arising out of or relating thereto,
other than after an Event of Default shall have occurred and be continuing, to
act in a commercially reasonable manner. The Administrative Agent shall not be
required to take any action of any kind to collect, preserve or protect Fine
Host or Fine Host's rights in the Collateral or against other parties thereto.
Fine Host hereby releases the Administrative Agent from any claims, causes of
action and demands at any time arising out of or with respect to this Agreement,
the Liabilities, the use of the Collateral and/or any actions reasonably taken
or omitted to be taken by the Administrative Agent with respect thereto, and
Fine Host hereby agrees to hold the Administrative Agent harmless from and with
respect to any and all such claims, causes of action and demands, excepting only
those claims, causes of action and demands attributable to the Administrative
Agent's gross negligence or wilful misconduct.
13. No Waiver. Neither this Agreement nor any term hereof may be
changed, waived, discharged or terminated except by a written instrument
expressly referring to this Agreement and to the provisions so modified or
limited, and executed by the party to be charged. No act, failure or delay by
the Administrative Agent shall constitute a waiver of the Administrative Agent's
rights and remedies hereunder or otherwise. No single or partial waiver by the
Administrative Agent of any default or right of remedy that Fine Host may have
shall operate a waiver of any other default, right or remedy on a future
occasion. Fine Host hereby waives presentment, notice of dishonor and protest of
all instruments, included in or evidencing any of the Liabilities or the
Collateral, and any and all other notices and demands whatsoever (except as
expressly provided herein or in the Loan Agreement).
14. Governing Law. THIS AGREEMENT IS INTENDED TO TAKE EFFECT AS A SEALED
INSTRUMENT AND SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE COMMONWEALTH OF MASSACHUSETTS.
15. Miscellaneous. The headings of each section of this Agreement are
for convenience only and shall not define or limit the provisions thereof. This
Agreement and all rights and obligations hereunder shall be binding upon Fine
Host and Fine Host's respective heirs, successors and assigns, and shall inure
to the benefit of the Administrative Agent and the Administrative Agent's
successors and assigns. If any term of this Agreement shall be held to be
invalid, illegal or unenforceable, the validity of all other terms hereof shall
be in no way affected thereby, and this Agreement shall be construed and be
enforceable as if such invalid, illegal or unenforceable term had not been
included herein.
16. Conflicting Provisions. In the event of any conflict between the
provisions of this Agreement and those of the Loan Agreement, the Loan Agreement
shall govern.
[THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK]
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed under seal this
Agreement as of the date first above written.
WITNESS: FINE HOST CORPORATION
_________________________ By:____________________________________
Name: Name:
Title:
Its duly authorized officer
WITNESS: BANKBOSTON, N.A., AS ADMINISTRATIVE AGENT
_________________________ By:____________________________________
Name: Name:
Title:
Its duly authorized officer
61942_3
EXHIBIT L
FORM OF
[SECOND] AMENDED AND RESTATED JOINT VENTURE PLEDGE AGREEMENT
(for [Name of Joint Venture Subsidiary Borrower])
This [SECOND] AMENDED AND RESTATED JOINT VENTURE PLEDGE AGREEMENT (the
"Agreement") is made as of July __, 1997, by and between (a) FINE HOST
CORPORATION, a Delaware corporation with a principal office at 3 Greenwich
Office Park, Greenwich, Connecticut 06830 ("Fine Host"), and (b) BANKBOSTON,
N.A., as Administrative Agent (in such capacity, the "Administrative Agent") for
various banks and other financial institutions which are or may hereafter become
parties (said banks and other financial institutions are hereinafter referred to
collectively as the "Banks") to that certain Fourth Amended and Restated Loan
Agreement, dated of even date herewith (as the same may be hereafter further
amended, modified, supplemented, extended or restated, from time to time, the
"Loan Agreement") by and among Fine Host, all of the Subsidiaries of Fine Host,
the Administrative Agent, USTrust, as Documentation Agent for the Banks (in such
capacity, the "Documentation Agent")(the Administrative Agent and the
Documentation Agent are hereinafter sometimes referred to collectively as the
"Agents") and the Banks.
All capitalized terms not defined herein but defined in the Loan
Agreement shall have the meanings given to such terms in the Loan Agreement, and
if not defined in the Loan Agreement, then the meanings given to such terms in
the Uniform Commercial Code, as in effect, from time to time, in The
Commonwealth of Massachusetts (the "UCC").
WITNESSETH:
WHEREAS, in connection with the Existing Loan Agreement, Fine Host
entered into, among other things, a certain [First Amended and Restated] Joint
Venture Pledge Agreement, dated as of ___________, 199_, (the "Existing Pledge
Agreement"), by and between Fine Host and USTrust, as Lender and Agent for the
Existing Banks (in such capacity, the "Original Agent"), pursuant to which,
among other things, Fine Host granted in favor of the Original Agent, for the
ratable benefit of the Existing Banks, a security interest in, among other
things, all of the rights, title and interests of Fine Host in
__________________ Joint Venture, a joint venture (the "Joint Venture Subsidiary
Borrower") organized pursuant to a certain Joint Venture Agreement, dated
__________, by and among (i) Fine Host, (ii) _________________
____________________ and (iii) ________________________, as subsequently amended
from time to time (said Joint Venture Agreement, as so amended, and as the same
may be hereafter further amended, modified, supplemented, extended or restated,
from time to time, is hereinafter referred to as the "Joint Venture Agreement"),
all in order to secure all of the obligations and liabilities of Fine Host to
the Existing Banks; and
WHEREAS, Fine Host and all of its Subsidiaries (including without
limitation, the Joint Venture Subsidiary Borrower) have requested that the
Existing Banks amend and restate in its entirety the Existing Loan Agreement in
the manner provided in the Loan Agreement; and
WHEREAS, the Agents and all of the Banks which are not Existing Banks
have agreed to become parties to the Loan Agreement; and
WHEREAS, it is a condition precedent to the effectiveness of the Loan
Agreement and to the obligations of the Banks to make Extensions of Credit
provided for therein that Fine Host shall have amended and restated in its
entirety the Existing Pledge Agreement in the manner provided herein.
NOW, THEREFORE, in consideration of the premises contained herein, and
to induce the Banks to amend and restate the Existing Loan Agreement, as
provided in the Loan Agreement, and to induce the Banks to make Extensions of
Credit under the Loan Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Fine Host and the
Administrative Agent, for the ratable benefit of the Banks, hereby amend and
restate the Existing Pledge Agreement to read in its entirety as follows:
1. Pledge And Grant of Security Interest in Collateral. To secure all
of the Liabilities of Fine Host to the Administrative Agent under the Loan
Agreement and the other Loan Documents, Fine Host hereby pledges, assigns,
grants to the Administrative Agent, for the ratable benefit of the Banks, a
continuing first priority security interest in the following, in each case
whether now owned or hereafter acquired, issued or arising (collectively, the
"Collateral"):
(a) all of the joint venture interests of Fine Host in the
Joint Venture, whether now existing or hereafter acquired (hereinafter
referred to as the "Joint Venture Interests");
(b) all payments, dividends (whether cash or in kind,
including any dividends of additional Joint Venture Interests) and
other distributions (including but not limited to, all distribution of
assets or property of the Joint Venture in the event of a liquidation
or winding up of the Joint Venture or otherwise) received by the Joint
Venture with respect to the Joint Venture Interests, but excluding
payments constituting payment for or reimbursement of costs and
expenses as provided in the Joint Venture Agreement, such payments
being referred to herein as "Cost Payments";
(c) all rights, interests, and remedies available to Fine Host
pursuant to any of the foregoing, including but not limited to any
voting or other rights arising from the Joint Venture Interests, and
under the Joint Venture Agreement or applicable law; and
(d) all proceeds, substitutions, accessions, and replacements
(including any securities or other property in exchange therefore) of
any of the foregoing.
2. UCC-1 Financing Statements; Certificates.
2.1 UCC-1 Financing Statements. Fine Host shall execute and
deliver contemporaneously herewith to the Administrative Agent certain
UCC-1 Financing Statements, in form satisfactory to the Administrative
Agent, and will pay all costs associated with filing the same in all
public offices wherever filing is deemed by the Administrative Agent to
be necessary, desirable or otherwise appropriate.
2.2 Certificates. If, at any time, the Joint Venture Interests
shall be represented by one or more joint venture certificates or other
certificates of ownership or any other similar documents, Fine Host
shall promptly deliver such certificates, or other documents to the
Administrative Agent, accompanied by transfer powers endorsed in blank
respecting such certificates or documents, duly executed, with
signatures guaranteed if requested by the Administrative Agent.
3. Representations, Warranties and Covenants. Fine Host hereby
represents, warrants and covenants to the Administrative Agent
the following:
3.1 Locations; Supplemental Information Regarding Fine Host.
Fine Host's principal place of business, chief executive office and
mailing address is located at the address set forth at the beginning of
this Agreement, and Fine Host does not and will not conduct any
business under any trade name or trade style other than Fine Host's
legal name or such other names or styles as may be set forth in the
Loan Agreement or any of the other Loan Documents.
3.2 Title To Collateral. Fine Host has good and marketable
title to the Joint Venture Interests, subject to no pledges, liens,
security interests, charges, options, restrictions or other
encumbrances except the pledge and security interest created by this
Agreement and restrictions set forth in the Joint Venture Agreement.
3.3 Authority. Fine Host has full power, authority and legal
right to execute, deliver and perform its obligations under this
Agreement and to pledge and grant a security interest in all of the
Collateral pursuant to this Agreement, and the execution, delivery and
performance hereof and the pledge of and granting of a security
interest in the Collateral hereunder do not contravene any law, rule or
regulation or any judgment, decree or order of any tribunal or of any
agreement or instrument to which Fine Host is a party or by which Fine
Host or Fine Host's property is bound or affected or constitute a
default thereunder. Fine Host covenants that Fine Host will defend the
Administrative Agent's rights and security interest in the Joint
Venture Interests against the claims and demands of all persons
whomsoever.
3.4 Transfers By Fine Host. Fine Host will not sell, assign,
transfer or otherwise dispose of, grant any option with respect to, or
pledge or grant any security interest in or otherwise encumber or
restrict any of the Collateral or any interest therein, except as
provided for in this Agreement.
3.5 Joint Venture Agreement. Attached hereto as Exhibit A is a
true, complete and correct copy of the Joint Venture Agreement, and the
Joint Venture Agreement has not been amended, modified, or rescinded
and is in full force and effect as of the date hereof. Fine Host will
not amend, modify, restate, assign, pledge or otherwise alter any of
the terms, conditions and provisions of the Joint Venture Agreement,
without the prior written consent of the Administrative Agent;
provided, however, that, prior to the occurrence of a default under any
of the Loan Documents, Fine Host may, without such consent, make or
agree to any such amendment, modification or alternation that Fine Host
reasonably believes is in the best interest of Fine Host and does not
materially affect either the security interest granted by Fine Host to
the Administrative Agent hereunder or the ability of Fine Host to make
payments required to be made to the Administrative Agent under the Loan
Documents.
4. No Joint Venture Liability. The foregoing pledge and security
interest is for collateral purposes only and, to the fullest extent permitted by
law, the Administrative Agent shall not, either by virtue hereof or by its
receipt of distributions from or by virtue of the exercise of any of its rights
hereunder, be deemed to be a joint venturer of the Joint Venture or to have any
liability for the debts, obligations or liabilities of the Joint Venture, Fine
Host or any other participant in the Joint Venture, or to have any obligation to
make capital contributions to, perform any services for, or discharge any duties
of a joint venturer of the Joint Venture.
5. Liquidation and Recapitalization.
5.1 Any sums or other property paid or distributed upon or
with respect to the Joint Venture Interests, whether by dividend or
redemption or upon the liquidation or dissolution of the Joint Venture
(but excluding Cost Payments), shall, except to the limited extent
provided in Section 6, be paid over and delivered to the Administrative
Agent to be held by the Administrative Agent as security for the
payment and performance in full of all of the Liabilities. In case,
pursuant to the recapitalization or reclassification of the Joint
Venture or pursuant to the reorganization thereof, any distribution of
capital shall be made on or in respect of any of the Joint Venture
Interests or any property shall be distributed upon or with respect to
any of the Joint Venture Interests, the property so distributed shall
be delivered to the Administrative Agent to be held by it as security
for the Liabilities. Except to the limited extent provided in Section
6, all sums of money and property paid or distributed in respect of the
Joint Venture Interests, whether as a dividend or upon such a
liquidation, dissolution, recapitalization or reclassification or
otherwise (but excluding Cost Payments), that are received by Fine Host
shall, until paid or delivered to the Administrative Agent, be held in
trust for the Administrative Agent as security for the payment and
performance in full of all of the Liabilities.
5.2 All sums of money that are delivered to the Administrative
Agent pursuant to this Section 5 shall be deposited into an interest
bearing account in the name of the Administrative Agent (the "Cash
Collateral Account"). Some or all of the funds from time to time in the
Cash Collateral Account may be invested in time deposits, certificates
of deposit issued by a bank, or U.S. government obligations (such time
deposits, certificates of deposit or U.S. Government obligations being
hereinafter referred to, collectively, as "Cash Amounts"), that are
satisfactory to both the Administrative Agent and Fine Host. Interest
earned on the Cash Collateral Account and on the Cash Amounts shall be
deposited in the Cash Collateral Account. The Cash Collateral Account,
all sums from time to time standing to the credit of the Cash
Collateral Account, any and all Cash Amounts, any and all instruments
or other writings evidencing Cash Amounts and any and all proceeds or
any thereof are hereinafter referred to as the "Cash Collateral."
5.3 Fine Host shall have no right to withdraw sums from the
Cash Collateral Account, to receive any of the Cash Collateral or to
require the Administrative Agent to part with the Administrative
Agent's possession of any instruments or other writings evidencing any
Cash Amounts.
6. Distributions and Voting Prior to Event of Default. So long as no
Event of Default shall have occurred and be continuing, Fine Host shall be
entitled to receive all cash dividends and distributions paid in respect of the
Joint Venture Interests, to vote the Joint Venture Interests and to give
consents, waivers and ratifications in respect of the Joint Venture Interests;
provided, however, that no vote shall be cast or consent, waiver or ratification
given by Fine Host if the effect thereof would or be inconsistent with or result
in any violation of any of the provisions of the Loan Agreement or this
Agreement. All such rights of Fine Host to receive cash dividends and
distributions shall cease in case any Event of Default shall have occurred and
be continuing. All such rights of Fine Host to vote and give consents, waivers
and ratifications with respect to the Joint Venture Interests shall, at the
Administrative Agent's option, as evidenced by the Administrative Agent's
notifying Fine Host of such election, cease in case any Event of Default shall
have occurred and be continuing.
7. Remedies Following Event of Default. If any Event of Default shall
occur and be continuing, the Administrative Agent shall thereafter have the
following rights and remedies (to the extent permitted by applicable law) in
addition to the rights and remedies of a secured party under the UCC, all such
rights and remedies being cumulative, not exclusive, and enforceable
alternately, successively or concurrently, at such time or times as the
Administrative Agent deems expedient:
(a) if the Administrative Agent so elects and gives notice of
such election to Fine Host, the Administrative Agent may vote any or
all of the Joint Venture Interests (whether or not the same shall have
been transferred into its name or the name of its nominee or nominees)
and give all consents, waivers and ratification in respect of the Joint
Venture Interests and otherwise act with respect thereto as though it
was the outright owner thereof (Fine Host hereby irrevocably appoints
the Administrative Agent the proxy and attorney-in-fact of Fine Host,
with full power of substitution, to do so);
(b) the Administrative Agent may demand, sue for, collect or make any
compromises or settlement which it deems suitable in respect of the Collateral;
(c) the Administrative Agent may sell, resell, assign and
deliver or otherwise dispose of any or all of the Collateral, for cash
or credit or both and upon such terms, at such place or places and at
such time or times and to such persons as the Administrative Agent
deems expedient, all without demand for performance by Fine Host or any
notice or advertisement whatsoever except such as may be required by
law; and
(d) the Administrative Agent may cause all or any part of the Collateral
held by it to be transferred into its name or the name of its nominee or
nominees.
Fine Host recognizes that the Administrative Agent may be unable to
effect a public sale of the Joint Venture Interests by reason of certain
prohibitions contained in the Securities Act of 1933, as amended, or any
applicable state securities laws, but may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers who will be obliged to
agree, among other things, to acquire such securities for their own account, for
investment and not with a view to the distribution or resale thereof. Fine Host
agrees that any such private sales may be at prices and on other reasonable
terms less favorable to the seller than if sold at public sales and that such
private sales shall be deemed to have been made in a commercially reasonable
manner. The Administrative Agent shall be under no obligation to delay a sale of
any of the Joint Venture Interests for the period of time necessary to permit
the issuer of such securities to register such securities for public sale under
the Securities Act of 1933, as amended, even if the issuer would agree to do so.
Fine Host hereby agrees that the sending of ten (10) days' notice by
certified mail return receipt requested, postage prepaid, to Fine Host's address
set forth at the head of this Agreement of the place and time of any public sale
or of the time after which any private sale or other intended disposition is to
be made, shall be deemed reasonable notice thereof. To the extent permitted by
law, the Administrative Agent may enforce its rights hereunder without any other
notice and without compliance with any other condition precedent now or
hereafter imposed by statute, rule of law or otherwise (all of which are hereby
expressly waived by Fine Host). If any of the Collateral is sold by the
Administrative Agent upon credit or for future delivery, the Administrative
Agent shall not be liable for the failure of the purchaser to pay for the same
and in such event the Administrative Agent may resell such Collateral. The
Administrative Agent may buy any part or all of the Collateral at any public
sale and if any part or all of the Collateral is of a type customarily sold in a
recognized market or is of the type which is the subject of widely-distributed
standard price quotations, the Administrative Agent may buy at private sale and
may make payments thereof by any means. The Administrative Agent may apply the
cash proceeds actually received from any sale or other disposition to the
reasonable expenses of retaking, holding, preparing for sale, selling and the
like, to reasonable attorneys' fees and all legal expenses, travel and other
expenses which may be incurred by the Administrative Agent in attempting to
collect the Liabilities, or any of them, or to enforce this Agreement or in the
prosecution or defense of any action or proceeding related to the subject matter
of this Agreement; and then to the Liabilities in such order as to principal or
interest remaining unpaid, including legal interest thereon, and the balance of
any expenses unpaid, as the Pledge in it sole discretion may reasonably
determine, and any surplus shall be paid to Fine Host.
The Administrative Agent understands that certain state liquor laws
that now or may in the future be applicable to Fine Host may require that
certain approvals be obtained, or certain filings be made or notices given,
prior to the time at which (i) the Joint Venture Interests may be transferred
into the name of the Administrative Agent or its nominee or (ii) the
Administrative Agent may exercise control with respect to the Joint Venture
Interests if related liquor licenses are to remain in effect.
8. Costs; Legal Fees. Fine Host agrees to pay, or to reimburse the
Agents and the Banks, as the case may be, on demand, for all fees, costs and
expenses (including reasonable legal fees, costs and expenses) incurred or paid
by any of the Agents and the Banks in connection with: (a) the collection of the
Liabilities or the enforcement of the Administrative Agent's rights and remedies
under this Agreement; (b) the administration, supervision, protection of or
realization on any of the Collateral held as security for any of the
Liabilities; or (c) the defense of any action against any of the Agents or the
Banks with respect to the Administrative Agent's rights or remedies in respect
to the Collateral; and all of the foregoing fees, costs, and expenses shall be
part of the Liabilities secured by this Agreement, and may be paid by the
Administrative Agent, acting in its sole discretion, and added to the
Liabilities, in each case, whether or not any suit or other legal proceedings
are commenced or pending.
9. Marshalling. The Administrative Agent shall not be required to
marshall any present or future security for (including but not limited to this
Agreement and the Collateral) the Liabilities or any of them or to resort to
such security in any particular order; and all of its rights hereunder and in
respect of such security shall be cumulative and in addition to all other
rights, however existing or arising. To the extent that it lawfully may, Fine
Host hereby agrees that it will not invoke any law which might cause delay in or
impede the enforcement of the Administrative Agent's rights under this Agreement
or under any other instrument evidencing any of the Liabilities or under which
any of the Liabilities is outstanding or by which any of the Liabilities is
secured or guaranteed, and Fine Host hereby irrevocably waives the benefits of
all such laws.
10. Fine Host's Liabilities Not Affected. The obligations of Fine Host
hereunder shall remain in full force and effect without regard to, and shall not
be impaired by (a) any exercise or nonexercise, or any waiver, by the
Administrative Agent of any right, remedy, power or privilege under or in
respect of any of the Liabilities or any security thereof (including this
Agreement); (b) any amendment to or modification of the Loan Agreement or any of
the Liabilities; (c) any amendment to or modification of any instrument (other
than this Agreement) securing any of the Liabilities; or (d) the taking of
additional security for, or any other assurances of payment of, any of the
Liabilities or the release or discharge or termination of any security or other
assurances of payment or performance for any of the Liabilities; whether or not
Fine Host shall have notice or knowledge of any of the foregoing.
11. Further Assurances. Fine Host will do all such acts, and will
furnish to the Administrative Agent all such financing statements, certificates,
legal opinions and other documents and will obtain all such governmental
consents and corporate approvals and will do or cause to be done all such other
things as the Administrative Agent may reasonably request from time to time in
order to give full effect to this Agreement and to secure the rights of the
Administrative Agent hereunder. If the Administrative Agent so elects, a
photocopy of this Agreement may at any time and from time to time be filed by
the Administrative Agent as a financing statement in any recording office in any
jurisdiction.
12. Administrative Agent's Exoneration. Under no circumstances shall
the Administrative Agent be deemed to assume any responsibility for or
obligation or duty with respect to any part or all of the Collateral of any
nature or kind or any matter or proceedings arising out of or relating thereto,
other than after an Event of Default shall have occurred and be continuing, to
act in a commercially reasonable manner. The Administrative Agent shall not be
required to take any action of any kind to collect, preserve or protect Fine
Host or Fine Host's rights in the Collateral or against other parties thereto.
Fine Host hereby releases the Administrative Agent from any claims, causes of
action and demands at any time arising out of or with respect to this Agreement,
the Liabilities, the use of the Collateral and/or any actions reasonably taken
or omitted to be taken by the Administrative Agent with respect thereto, and
Fine Host hereby agrees to hold the Administrative Agent harmless from and with
respect to any and all such claims, causes of action and demands, excepting only
those claims, causes of action and demands attributable to the Administrative
Agent's gross negligence or wilful misconduct.
13. No Waiver. Neither this Agreement nor any term hereof may be
changed, waived, discharged or terminated except by a written instrument
expressly referring to this Agreement and to the provisions so modified or
limited, and executed by the party to be charged. No act, failure or delay by
the Administrative Agent shall constitute a waiver of the Administrative Agent's
rights and remedies hereunder or otherwise. No single or partial waiver by the
Administrative Agent of any default or right of remedy that Fine Host may have
shall operate a waiver of any other default, right or remedy on a future
occasion. Fine Host hereby waives presentment, notice of dishonor and protest of
all instruments, included in or evidencing any of the Liabilities or the
Collateral, and any and all other notices and demands whatsoever (except as
expressly provided herein or in the Loan Agreement).
14. Governing Law. THIS AGREEMENT IS INTENDED TO TAKE EFFECT AS A SEALED
INSTRUMENT AND SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE COMMONWEALTH OF MASSACHUSETTS.
15. Miscellaneous. The headings of each section of this Agreement are
for convenience only and shall not define or limit the provisions thereof. This
Agreement and all rights and obligations hereunder shall be binding upon Fine
Host and Fine Host's respective heirs, successors and assigns, and shall inure
to the benefit of the Administrative Agent and the Administrative Agent's
successors and assigns. If any term of this Agreement shall be held to be
invalid, illegal or unenforceable, the validity of all other terms hereof shall
be in no way affected thereby, and this Agreement shall be construed and be
enforceable as if such invalid, illegal or unenforceable term had not been
included herein.
16. Conflicting Provisions. In the event of any conflict between the
provisions of this Agreement and those of the Loan Agreement, the Loan Agreement
shall govern.
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed under seal this
Agreement as of the date first above written.
WITNESS: FINE HOST CORPORATION
_________________________ By:____________________________________
Name: Name:
Title:
Its duly authorized officer
WITNESS: BANKBOSTON, N.A., AS ADMINISTRATIVE AGENT
_________________________ By:____________________________________
Name: Name:
Title:
Its duly authorized officer
61943_3
Exhibit M
MORTGAGE, SECURITY AGREEMENT AND
FINANCING STATEMENT
This MORTGAGE, SECURITY AGREEMENT AND FINANCING STATEMENT (this
"Mortgage") is made as of July __, 1997, by and between (a) FINE HOST
CORPORATION, a Delaware corporation, with its principal place of business at 3
Greenwich Office Park, Greenwich, Connecticut 06831 (together with its
successors and assigns, "Fine Host") and (b) BANKBOSTON, N.A., as Administrative
Agent for the Banks (as defined below)(BankBoston, N.A., in such capacity, is
hereinafter referred to as the "Administrative Agent"), with its principal place
of business at 100 Federal Street, Boston, Massachusetts 02110.
Reference is hereby made to a certain Fourth Amended and Restated Loan
Agreement, dated of even date herewith (as the same may be hereafter further
amended, modified, supplemented, extended or restated, from time to time, the
"Loan Agreement") by and among Fine Host, all of the Subsidiaries of Fine Host,
the Administrative Agent, USTrust as Documentation Agent for the Banks (in such
capacity, the "Documentation Agent")(the Administrative Agent and the
Documentation Agent are hereinafter sometimes referred to collectively as the
"Agents") and various banks and other financial institutions which are or may
hereafter become parties thereto (said banks and other financial institutions
are hereinafter referred to collectively as the "Banks"). All capitalized terms
not defined herein but defined in the Loan Agreement shall have the meanings
given to such terms in the Loan Agreement, and if not defined in the Loan
Agreement, then the meanings given to such terms in the Uniform Commercial Code,
as in effect, from time to time, in the Commonwealth of Kentucky (the "UCC").
Preliminary Statements:
WHEREAS, Fine Host and all of its Subsidiaries have requested that the
Existing Banks amend and restate in its entirety the Existing Loan Agreement in
the manner provided in the Loan Agreement; and
WHEREAS, it is a condition precedent to the effectiveness of the Loan
Agreement and to the obligations of the Banks to make Extensions of Credit
provided for therein that Fine Host shall have entered into this Mortgage;
NOW, THEREFORE, in consideration of the premises contained herein, and
to induce the Banks to amend and restate the Existing Loan Agreement, as
provided in the Loan Agreement, and to induce the Banks to make Extensions of
Credit under the Loan Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Fine Host hereby
irrevocably warrants, grants, bargains, sells, transfers, conveys and assigns to
the Administrative Agent, for the ratable benefit of the Banks, WITH MORTGAGE
COVENANTS, subject to the terms and conditions of this Mortgage, all of the
following-described estate, property and interest of Fine Host now or hereafter
acquired, all of which, together with all cash and noncash proceeds thereof, is
referred to in this Mortgage as the "Mortgaged Estate":
Property, Rents and Derivative Interests
The real property commonly known as the Palace Theatre, located at
Fourth Street, Louisville, Jefferson County, Kentucky, all as more particularly
described in Exhibit A attached hereto and by this reference incorporated herein
(the "Property"); all rents, issues, profits, royalties, income and other
benefits derived from the Property (collectively, the "Rents"); all estate,
right, title and interest of Fine Host in and to all leases or subleases
covering the Property or any portion thereof and all guaranties thereof now or
hereafter existing or entered into; all interests, estate or other claims, both
in law and in equity, which Fine Host now has or may hereafter acquire in the
Property; all easements, rights-of-way and rights used in connection therewith
or as a means of access thereto, and all tenements, hereditaments and
appurtenances thereof and thereto, and all water rights and shares of stock
evidencing the same; all right, title and interest of Fine Host, now owned or
hereafter acquired, in and to any land lying within the right-of-way of any
street, open or proposed, adjoining the Property and any and all sidewalks,
alleys and strips and gores of land adjacent to or used in connection with the
Property (collectively, the "Derivative Interests");
Improvements
Any and all buildings and improvements now or hereafter erected on the
Property, including, but not limited to, the fixtures, attachments, appliances,
equipment, machinery, and other articles attached to such buildings and
improvements (the "Improvements");
Personal Property
All right, title and interest of Fine Host in and to (i) all tangible
personal property now owned or hereafter acquired by Fine Host, and (ii) all
tangible personal property now or at any time hereafter located on or at the
Property and used in connection therewith, including, but not limited to: all
building materials stored on the Property, goods, machinery, tools, equipment
(including fire sprinklers and alarm systems, air conditioning, heating and
refrigerating equipment, equipment for electronic monitoring, entertainment,
recreation, window or structural cleaning, maintenance, exclusion of vermin or
insects, removal of dust, refuse or garbage and all other equipment of every
kind), lobby and all other indoor and outdoor furniture (including tables,
chairs, planters, desks, sofas, shelves, lockers and cabinets), wall beds, wall
safes, furnishings, appliances (including dishwashers, garbage disposal units,
refrigerators, fans, heaters, stoves, water heaters and incinerators),
inventory, rugs, carpets and other floor coverings, draperies and drapery rods
and brackets, awnings, window shades, venetian blinds, curtains, lamps,
chandeliers and other lighting fixtures and maintenance and other supplies;
other than such property owned by tenants of Fine Host and not acquired from
Fine Host subsequent to the date of this Mortgage (the "Personal Property");
Intangibles
All of Fine Host's interest in all existing and future accounts,
contract rights, general intangibles, files, books of account, agreements,
permits, licenses and certificates necessary or desirable in connection with the
acquisition, ownership, leasing, construction, operation, servicing or
management of the Mortgaged Estate, whether now existing or entered into or
obtained after the date hereof (the "Intangibles");
Escrow Accounts
All of Fine Host's interest in all existing and future escrow accounts
established hereunder with respect to the Property including, but not limited
to, escrows established for the payment of taxes, insurance, liens and
encumbrances (the "Escrow Accounts"); and
Claims and Awards
All the estate, interest, right, title, other claim or demand, including
claims or demands with respect to the proceeds of insurance and any and all
awards made for the taking by eminent domain, or by any proceeding or purchase
in lieu thereof, of the whole or any part of the Mortgaged Estate (the "Claims
and Awards"), and Fine Host hereby authorizes, directs and empowers the
Administrative Agent, at its option, on Fine Host's behalf, and upon the
occurrence and during the continuance of any Event of Default, to adjust,
compromise, claim, collect and receive such proceeds and to give proper receipts
and acquittances therefor.
The Rents, Derivative Interests, Improvements, Personal Property,
Intangibles, Escrow Accounts and Claims and Awards are collectively referred to
hereafter as the "Collateral".
TO HAVE AND TO HOLD the Mortgaged Estate hereby granted or mortgaged,
unto the Administrative Agent, and its substitutes, successors and assigns, in
fee simple forever.
PROVIDED, HOWEVER, that these presents are upon the condition that, if
the obligations secured hereby shall be paid when due, and if Fine Host shall
keep, perform and observe the obligations, covenants, agreements and provisions
in this Mortgage, then this Mortgage and the estate and rights hereby granted
shall cease, terminate and be void, but otherwise shall be and remain in full
force and effect.
THIS MORTGAGE SHALL SECURE THE FOLLOWING INDEBTEDNESS AND OBLIGATIONS,
INCLUDING ALL REPLACEMENTS, RENEWALS, AMENDMENTS, EXTENSIONS, SUBSTITUTIONS AND
MODIFICATIONS:
(i) Payment of all indebtedness (the aggregate principal amount
of which indebtedness is Two Hundred Million and 00/100 Dollars
($200,000,000.00)) and performance of all obligations and covenants of
Fine Host under or pursuant to the following:
(A) The Loan Agreement;
(B) All of the Notes;
(C) This Mortgage;
(D) A certain Conditional Assignment of Rentals,
Profits and Income dated of even date herewith, from Fine Host,
in favor of the Administrative Agent, to be recorded
contemporaneously with this Mortgage (as the same may be amended
or restated from time to time, the "Conditional Assignment of
Rentals"); and
(E) All of the other Loan Documents executed by Fine
Host or any of the other Borrowers and delivered to the
Administrative Agent herewith; and
(ii) Payment of all future advances, all sums advanced by any of
the Agents or the Banks to protect the Mortgaged Estate or otherwise
made pursuant to the terms of the documents and instruments set forth in
subparagraph (i) above, with interest on all the foregoing at the late
rate, set forth in subsection 3.4(c) of the Loan Agreement (the "Late
Rate"), from the date of such advance to the date of payment by the
Borrowers.
The indebtedness and the obligations secured by this Mortgage
which are described in (i) and (ii) above are referred to herein as the
"Secured Obligations." The final date on which the Secured Obligations
must be paid in full is on or before the sixth anniversary of the date
hereof.
ARTICLE I
REPRESENTATIONS, WARRANTIES, COVENANTS
AND AGREEMENTS OF Fine Host
Fine Host hereby represents, warrants, covenants and agrees:
Section 1.01. Payment of Secured Obligations. Fine Host hereby grants this
Mortgage to secure the payment and performance when due of the Secured
Obligations.
Section 1.02. Title of Fine Host. Fine Host has and shall maintain,
subject only to the encumbrances listed as exceptions in Schedule B-I of the
mortgagee's title insurance policy delivered to the Administrative Agent by Fine
Host herewith, in its own right, good, marketable and indefeasible title in fee
simple to the Mortgaged Estate, and Fine Host has full right to make this
conveyance.
Section 1.03. Capital Improvements. Fine Host shall not make any
expenditures for Improvements on the Property which, individually or in the
aggregate, would materially and adversely affect the value, utility or current
use of the Mortgaged Estate.
Section 1.04. Maintenance, Repair, Alterations. Fine Host shall: (i)
keep the Mortgaged Estate in good condition and repair, subject to reasonable
and ordinary wear and tear; (ii) not remove, demolish or substantially alter any
of the Improvements, except in preparation of the interior of the Improvements
for new tenants in a manner which complies with all building codes, health codes
and other applicable laws, ordinances, and regulations, and all covenants,
conditions or restrictions affecting the Mortgaged Estate; (iii) complete
promptly and in a good and workmanlike manner any improvement, construction or
restoration on the Property and pay when due all claims for labor performed and
materials furnished therefor; (iv) comply with all laws, ordinances,
regulations, covenants, conditions and restrictions now or hereafter affecting
the Mortgaged Estate or any part thereof, including without limitation, the
Americans with Disabilities Act and the Fair Housing Act, if applicable to the
Mortgaged Estate, and all regulations promulgated pursuant thereto, except for
such laws, ordinances, regulations, covenants, conditions and restrictions the
violation of which would not, in the aggregate, have a Material Adverse Effect;
(v) keep and maintain grounds, sidewalks, roads, parking and landscape areas in
good and neat order and repair; and (vi) not commit, suffer or permit any act to
be done in or upon the Mortgaged Estate in violation of any law, ordinance or
regulation (except as otherwise provided in clause (iv) above). Fine Host shall
have the right to contest by appropriate legal proceedings, at Fine Host's
expense and without cost or expense to the Administrative Agent, the validity of
any laws, ordinances, orders, rules, regulations, covenants, conditions or
restrictions affecting the Mortgaged Estate or the business conducted on the
Property if compliance therewith is legally held in abeyance without the
incurrence of any charge or lien against the Mortgaged Estate, and further
provided such noncompliance or contest shall not otherwise adversely affect the
validity or priority of this Mortgage; and in such event Fine Host may postpone
compliance therewith until the final determination of any such proceedings,
provided that Fine Host shall at all times prosecute such proceedings diligently
and in good faith to completion.
Section 1.05. Required Insurance. Fine Host shall maintain insurance in
respect of the Mortgaged Estate in compliance with the provisions of subsection
6.6 of the Loan Agreement and shall otherwise comply with all such provisions as
they are applicable to the Mortgaged Estate.
Section 1.06. Indemnification; Subrogation; Waiver of Offset.
(a) Fine Host shall indemnify and hold each of the Agents and
the Banks harmless from all liability arising in connection with any
litigation concerning this Mortgage or the Mortgaged Estate, including
all reasonable attorneys' fees and expenses incurred by any of the
Agents or the Banks in any such litigation, but not including any
litigation arising from any fault or misconduct of any of the Agents or
the Banks. Without limiting the generality of the foregoing, Fine Host
represents and warrants to each of the Agents and the Banks that no
agent or broker or finder has acted on its behalf in connection with the
loan secured hereby or in connection with the Loan Documents. Fine Host
hereby indemnifies each of the Agents and the Banks against any and all
liability, loss, cost or damage, including attorneys' fees, associated
with any claims of any agent, broker or finder alleged to have acted on
behalf of Fine Host.
(b) Fine Host waives any and all right to claim or recover
against any of the Agents, the Banks, or their respective officers,
employees, agents, attorneys and representatives, for loss of or damage
to Fine Host, the Mortgaged Estate, Fine Host's property or the property
of others under Fine Host's control from any cause insured against or
required to be insured against by the provisions of this Mortgage,
except to the extent that any insurance payments pursuant to claims are
not paid due to the gross negligence or willful misconduct of any of the
Agents or the Banks.
(c) All sums payable by Fine Host hereunder shall be paid
without notice, demand, counterclaim, setoff, deduction or defense and
without abatement, suspension, deferment, diminution or reduction, and
the Secured Obligations of Fine Host hereunder shall in no way be
released, discharged or otherwise affected by reason of: (i) any damage
to or destruction of or any condemnation or similar taking of the
Mortgaged Estate or any part thereof; (ii) any restriction or prevention
of or interference with any use of the Mortgaged Estate or any part
thereof; (iii) any title defect or encumbrance or any eviction from the
Property or the Improvements or any part thereof by title paramount or
otherwise; (iv) any bankruptcy, insolvency, reorganization, composition,
adjustment, dissolution, liquidation or other like proceeding relating
to Fine Host, or any action taken with respect to this Mortgage by any
trustee or receiver of Fine Host, or by any court, in any such
proceeding; or (v) any other occurrence whatsoever, whether similar or
dissimilar to the foregoing; whether or not Fine Host shall have notice
or knowledge of any of the foregoing. To the extent permitted by law,
Fine Host waives all rights now or hereafter conferred by statute or
otherwise to any abatement, suspension, deferment, diminution or
reduction of any Secured Obligation, except to the extent that Fine
Host's rights have been affected by the gross negligence or willful
misconduct of the Administrative Agent.
Section 1.07. Taxes and Impositions.
(a) Fine Host agrees to pay when due all real property taxes and
assessments, general and special, and all other fees, taxes and
assessments of any kind or nature whatsoever, which are assessed or
imposed upon the Mortgaged Estate, or become due and payable, and which
create a lien upon any part of the Mortgaged Estate, or which are
imposed upon the Administrative Agent's interest in the Mortgaged Estate
(all of which taxes, assessments and other governmental and
nongovernmental charges of like nature are hereinafter referred to as
"Impositions").
(b) If at any time after the date hereof, there shall be
assessed or imposed (i) a tax or assessment on the Mortgaged Estate in
lieu of or in addition to the Impositions payable by Fine Host pursuant
to subparagraph (a) hereof, or (ii) a license fee, tax or assessment
imposed on the Administrative Agent and measured by or based in whole or
in part upon the amounts of the outstanding Secured Obligations, then
all such taxes, assessments or fees shall be deemed to be included
within the term "Impositions" as defined in subparagraph (a) hereof, and
Fine Host shall pay and discharge the same as herein provided with
respect to the payment of Impositions. If, at any time, Fine Host fails
to pay when due any Imposition, the Administrative Agent may, at the
Administrative Agent's election, but without obligation to do so,
advance any amounts to pay such Imposition, which advances, if any,
shall be secured hereby and shall be repayable to the Administrative
Agent upon demand, with interest thereon, at the Late Rate.
(c) Fine Host covenants to furnish the Administrative Agent
within ten (10) days after the date upon which any such Imposition is
due and payable without the imposition of any interest or other penalty
by Fine Host, official receipts of the appropriate taxing authority or
other proof satisfactory to the Administrative Agent, evidencing the
payment thereof.
(d) Fine Host covenants and agrees to use its best efforts to
prevent the joint assessment of the real and personal property, or any
other procedure whereby the lien of the real property taxes and the lien
of the personal property taxes shall be assessed, levied or charged to
the Mortgaged Estate as a single lien.
Section 1.08 Utilities. Fine Host shall pay when due all utility charges
which are incurred for the benefit or otherwise affect the Mortgaged Estate for
gas, electricity, water, telephone, cable or sewer services and all other
assessments or charges of a similar nature, whether public or private, affecting
the Mortgaged Estate or any portion thereof, whether or not such taxes,
assessments or charges are liens thereon.
Section 1.09. Actions Affecting Mortgaged Estate. Fine Host, or Fine
Host's title insurance carrier if Fine Host's appearance is not required, shall
appear in and contest any action or proceeding purporting to affect the title of
Fine Host in the Mortgaged Estate, security hereof or the rights or powers of
the Administrative Agent; and Fine Host shall pay all costs and expenses,
including, without limitation, cost of evidence of title and reasonable
attorneys' fees incurred by the Administrative Agent, in any such action or
proceeding in which the Administrative Agent may appear.
Section 1.10. Actions by the Administrative Agent To Preserve Mortgaged
Estate. If Fine Host fail to make any payment or to do any act as and in the
manner provided in this Mortgage, the Administrative Agent, in its sole
discretion, without obligation to do so and without notice to or demand upon
Fine Host and without releasing Fine Host from any Secured Obligation, may make
or do the same in such manner and to such extent as the Administrative Agent may
deem necessary to protect the security hereof. In connection therewith (without
limiting its general powers), the Administrative Agent shall have and is hereby
given the right, but not the obligation: (i) to enter upon and take possession
of the Mortgaged Estate; (ii) to direct Fine Host to terminate any management
agent (subject to the rights of third parties) and to employ such management
agent as the Administrative Agent may determine; (iii) to make additions,
alterations, repairs and improvements to the Mortgaged Estate which the
Administrative Agent may consider necessary or proper to keep the Mortgaged
Estate in good condition and repair; (iv) to appear and participate in any
action or proceeding affecting or which may affect the security hereof or of the
Administrative Agent; (v) to pay, purchase, contest or compromise any
encumbrance, claim, charge, lien or debt which may affect or appears to affect
the lien of this Mortgage or be prior or superior thereto; (vi) to pay necessary
expenses of counsel or other necessary or desirable costs and expenses incurred
by the Administrative Agent in exercise by the Administrative Agent of the
foregoing rights, including without limitation costs of evidence of title, court
costs, appraisals, surveys and reasonable attorneys' fees and reasonable
consultant fees, the payment of all of which costs and expenses shall be secured
hereby; and upon demand by the Administrative Agent, all such costs and expenses
shall be repayable by Fine Host to the Administrative Agent.
Section 1.11. Survival of Warranties. Fine Host shall fully and
faithfully satisfy and perform the Secured Obligations. All representations,
warranties and covenants of Fine Host contained in any Loan Document and all
warranties, representations or obligations contained in or evidenced by any
document or writing delivered in connection with any Loan Document shall ,
except as provided in the Loan Agreement, remain continuing obligations,
warranties and representations of Fine Host during any time when any portion of
the Secured Obligations remain outstanding.
Section 1.12. Eminent Domain. If the Mortgaged Estate, or any part
thereof or interest therein, be taken or damaged by reason of any public
improvement or condemnation proceeding, or in any other manner (a
"Condemnation"), or should Fine Host receive any notice or other information
regarding any such proceeding, Fine Host shall give prompt written notice
thereof to the Administrative Agent. The Administrative Agent may participate in
any such Condemnation proceedings, and Fine Host shall from time to time deliver
to the Administrative Agent all instruments requested by the Administrative
Agent to permit such participation. Fine Host shall, at its expense, diligently
prosecute any such proceedings and shall consult with the Administrative Agent
and its attorneys and experts, and cooperate with them in the carrying on or
defense of any such proceedings. All proceeds of Condemnation awards or proceeds
of sale in lieu of Condemnation with respect to the Mortgaged Estate and all
judgments, decrees and awards for injury or damage to the Mortgaged Estate or
any part thereof or interest therein shall be paid to the Administrative Agent
and shall be applied first to all costs and expenses incurred by the
Administrative Agent in obtaining the proceeds. The balance of the proceeds, if
any, shall be applied at the option of Fine Host if no Event of Default has
occurred and is continuing (or if any Event of Default has occurred and is
continuing, at the option of the Administrative Agent), (i) toward altering,
restoring or rebuilding the Mortgaged Estate or such portion thereof that may
have been altered, damaged or destroyed or (ii) against Secured Obligations, in
such order as Fine Host if no Event of Default has occurred and is continuing
(or if any Event of Default has occurred and is continuing, in such order as the
Administrative Agent), may in its discretion elect. If the Administrative Agent
elects not to apply all of the Condemnation proceeds for the restoration or
repair of the Mortgaged Estate as provided above, Fine Host shall not be
required to repair or restore that portion of the Mortgaged Estate affected by
the Administrative Agent's election and the failure to do so shall not
constitute a breach by Fine Host of its obligation to maintain the Mortgaged
Estate set forth in Section 1.04 hereof.
Fine Host hereby assigns and transfers to the Administrative Agent, for
the ratable benefit of the Banks, and agrees to execute such further assignments
of, all such proceeds, judgments, decrees and awards as the Administrative Agent
may request. The Administrative Agent is hereby authorized, in the name of Fine
Host, to execute and deliver valid acquittances for, and to appeal from, any
such judgment, decree or award. The Administrative Agent shall not be, in any
event or circumstance, liable or responsible for failure to collect or exercise
diligence in the collection of any proceeds, judgments, decrees or awards.
Section 1.13. Additional Security. In the event the Administrative Agent
at any time holds additional security for any of the Secured Obligations, it may
enforce the sale thereof or otherwise realize upon the same, at its option,
either before, concurrently with or after any sale is made hereunder.
Section 1.14. Successors and Assigns. This Mortgage and all warranties
and covenants of Fine Host contained in the Loan Documents apply to, inure to
the benefit of and bind all parties hereto, their heirs, successors and assigns.
Section 1.15. Inspections. The Administrative Agent or its
representatives are authorized to enter at any reasonable time upon prior
reasonable notice in any part of the Mortgaged Estate for the purpose of
inspecting the same and all books, records and documents relating thereto, and
for the purpose of performing any of the acts it is authorized to perform under
the terms of any of the Loan Documents.
Section 1.16. Further Assurances. So long as any Secured Obligation
shall remain unpaid, Fine Host shall execute, acknowledge, where appropriate,
and deliver from time to time promptly at the request of the Administrative
Agent all such instruments and documents as in the opinion of the Administrative
Agent are necessary or desirable to preserve the first priority mortgage lien
created by this Mortgage.
Section 1.17. No Event of Default. Fine Host agrees to notify the
Administrative Agent immediately in writing upon its knowledge of any default or
Event of Default.
Section 1.18. Transfer of Interests in Mortgaged Estate. Fine Host shall
not Convey (as defined below) or permit the Conveyance (as defined below) of,
ownership or control of all or any part of the Mortgaged Estate or any legal or
beneficial interest therein (including without limitation, rents, issues or
profits arising from the Mortgaged Estate)(an "Ownership Interest"), except in
compliance with the provisions of the Loan Agreement, provided that the
foregoing shall not prohibit Fine Host from entering into leases, management,
occupancy, concession or service agreements or other agreements that Fine Host
determines to be in the best interests of Fine Host in connection with its
ownership or operation of the Mortgaged Estate. "Convey" as used in this
Mortgage shall mean convey, sell, alienate, transfer, mortgage, encumber,
assign, pledge or otherwise dispose of voluntarily, involuntarily, by operation
of law or otherwise.
"Conveyance" as used in this Mortgage shall mean any act of Conveying.
In the event that any Ownership Interest becomes vested in a person or
persons in a manner which violates the terms hereof, the Administrative Agent
may, without notice to Fine Host or any other party, and notwithstanding the
existence of such default, deal with such successor or successors in interest
with reference to this Mortgage, the Notes, and the other Loan Documents in the
same manner as with Fine Host, without in any way releasing, discharging or
otherwise affecting the liability of Fine Host hereunder, or for the Secured
Obligations. No sale or Conveyance of all or any portion of the Mortgaged Estate
or any other Ownership Interest, no forbearance on the part of the
Administrative Agent, no extension of the time for the payment of the Secured
Obligations or any change in the terms thereof consented to by the
Administrative Agent shall in any way whatsoever operate to release, discharge,
modify, change or affect the original liability of Fine Host herein, either in
whole or in part, nor shall the full force and effect of this lien be altered
thereby, except as permitted by the Loan Agreement.
Fine Host shall not Convey all or any part of the Collateral or any
legal or beneficial interest therein (a "Collateral Ownership Interest") except
in compliance with the provisions of the Loan Agreement and shall not otherwise
do or permit anything to be done or occur that may impair the Collateral as
security hereunder except that so long as this Mortgage is not in default, Fine
Host shall be permitted to sell or otherwise dispose of any portion of the
Collateral when absolutely worn out, inadequate, unserviceable or unnecessary
for use in the operation of the Mortgaged Estate or in the conduct of the
business of Fine Host, upon replacing the same or substituting for the same
other Collateral at least equal in value to the initial value of that disposed
of and in such a manner so that said Collateral shall be subject to the security
interest created hereby and so that the security interest of the Administrative
Agent hereunder shall be the first priority security interest in said
Collateral.
Any Conveyance of any Ownership Interest or any Collateral Ownership
Interest shall have no effect upon, and shall not limit in any manner, the
liability under the Loan Documents of the party making such Conveyance.
Section 1.19. Advances. If Fine Host shall fail to perform any of the
covenants herein contained or contained in any instrument constituting
additional security for the Notes, the Banks may, but without obligation to do
so, make advances to perform same in its behalf, and all sums so advanced shall
be a lien upon the Mortgaged Estate and shall be secured by this Mortgage. The
Borrowers shall repay on demand all sums so advanced in its behalf with interest
at the Late Rate, to the maximum extent allowable under law. Nothing herein
contained shall prevent any such failure to perform on the part of Fine Host
from constituting an Event of Default as defined below.
Section 1.20. Financial Statements; Financial Condition. Fine Host shall
deliver to the Administrative Agent all of the financial information relating to
Fine Host as and when required by the Loan Documents.
Section 1.21. Estoppel Certificates. Fine Host, within ten (10) days
after written request from the Administrative Agent, shall furnish a duly
acknowledged written statement setting forth the amount of the debt secured by
this Mortgage, and stating either that no setoffs or defenses exist against the
Mortgage debt, or, if such setoffs or defenses are alleged to exist, the nature
thereof.
Section 1.22. Conditional Assignment of Rentals. Fine Host agrees to
execute and deliver to the Administrative Agent, in addition to the Conditional
Assignment of Rentals, such assignments of leases and rents applicable to the
Mortgaged Estate as the Administrative Agent may from time to time request while
this Mortgage and the debt secured hereby are outstanding.
Except with the Administrative Agent's prior written consent, Fine Host
shall not execute (except as noted above) an assignment of the rents or profits
or any part thereof from the Mortgaged Estate.
Nothing herein shall obligate the Administrative Agent to perform the
duties of Fine Host as landlord or lessor under any such leases or tenancies.
Fine Host hereby covenants and agrees that it shall at all times promptly and
faithfully perform, or cause to be performed, in all material respects, all of
the covenants, conditions and agreements contained in all leases of the
Mortgaged Estate now or hereafter existing, on the part of the lessor thereunder
to be kept and performed.
If any of such leases provide for the giving by the lessee of
certificates with respect to the status of such leases, Fine Host shall exercise
its right to request such certificates within five (5) days of any demand
therefor by the Administrative Agent. Any leases entered into after the date
hereof shall contain such a provision.
Fine Host shall furnish to the Administrative Agent, within ten (10)
days after a written request by the Administrative Agent to do so, a
Subordination and Attornment Agreement from each lessee of any portion of the
Mortgaged Estate. Any leases entered into after the date hereof shall contain
Subordination and Attornment provisions satisfactory to the Administrative Agent
and shall require the execution and recording of a Subordination and Attornment
Agreement with the Administrative Agent from time to time at the Administrative
Agent's option.
Section 1.23. Assignment of Agreements and Permits. Fine Host agrees to
execute and deliver to the Administrative Agent such assignments of agreements
and permits applicable to the Mortgaged Estate as the Administrative Agent may
from time to time request while this Mortgage and the debt secured hereby are
outstanding and represents and agrees that all such agreements and permits are,
and shall remain, in the name of Fine Host and not in the name of any other
party. Except with the Administrative Agent's prior written consent, Fine Host
shall not execute an assignment of the agreements and permits, and Fine Host
shall not execute any management contracts or other service contracts relating
to the Mortgaged Estate which are not terminable upon foreclosure of this
Mortgage or transfer of title to the Mortgaged Estate to the Administrative
Agent.
Section 1.24. Hazardous Materials.
(a) As used herein, "Hazardous Material" means (A) any substance,
material, or matter that may give rise to liability under (i) the Resource
Conservation Recovery Act, as amended by the Hazardous and Solid Waste
Amendments of 1984, 42 U.S.C. Sections 6902 et seq.; (ii) the Comprehensive
Environmental Response, Compensation and Liability Act, as amended by the
Superfund Amendments and Reauthorization Act, 42 U.S.C. Sections 9601 et seq.;
(iii) the Clean Water Act, 33 U.S.C. Sections 466 et seq. and 33 U.S.C. Sections
1344 et seq.; (iv) the Safe Drinking Water Act, 14 U.S.C. Sections 1401-1450;
(v) the Toxic Substances Control Act, 15 U.S.C. Sections 2601-2629; (vi) the
Hazardous Materials Transportation Act, 49 U.S.C. Sections 1801 et seq.; (vii)
the Resource Conservation and Recovery Act, 42 U.S.C. Sections 6901 et seq.;
(viii) the Clean Air Act, 42 U.S.C. Sections 7401 et seq.; (ix) any local, state
or federal rules and regulations promulgated pursuant to items (i) through (ix)
and any similar local, state or federal laws, rules, ordinances or regulations
either in existence as of the date hereof, or enacted or promulgated after the
date of this Agreement, that concern the transportation storage, placement,
handling, treatment, release, discharge, generation, manufacture, production,
disposal, management, control, containment, and/or removal (collectively,
"Treatment") of substances or materials that are or may become a threat to
public health or the environment; or (xi) any common law theory involving
materials or substances which are or are alleged to be hazardous to human health
or the environment based on nuisance, trespass, negligence, strict liability or
other tortious conduct (items (i) through (xi), as the same may be amended from
time to time, are collectively referred to herein as "Environmental Laws"); (B)
any "hazardous substance" listed in the U.S. Department of Transportation Table
(49 C.F.R. 172.101), as the same may be amended from time to time; and (C)
asbestos, lead paint, pcb's, urea formaldehyde foam insulation, radioactive
materials, and any materials, the removal of which is required or the
maintenance of which is prohibited or penalized.
(b) Fine Host covenants and warrants that, until the later to occur of
(a) the sale of the entire Mortgaged Premises by Fine Host, or (b) discharge of
this Mortgage of record, it will comply with and conform to, and will require
any and all users and occupants of the Mortgaged Estate to comply with and
conform to, all applicable Environmental Laws, except for such Laws the
violation of which would not, in the aggregate, have a Material Adverse Effect.
Fine Host further covenants there is currently no Treatment of any Hazardous
Material occurring upon, in or from, or which affects, the Mortgaged Estate, and
that Fine Host will not engage in or permit any party to engage in any Treatment
of any Hazardous Material upon, in or from, or which affects, the Mortgaged
Estate (except in compliance with Environmental Laws), and that on the date of
this Mortgage, to the best of Fine Host's knowledge, the Mortgaged Estate
complies with all Environmental Laws.
(c) Immediately upon receipt of any Notice, as defined in the next
sentence, Fine Host shall deliver to the Administrative Agent a complete copy of
any written Notice or a complete report in writing of the content of any other
Notice. "Notice," for the purposes of this subparagraph (c), shall mean any
note, notice, or report of any of the following, whether received prior to or
after the date of this Mortgage: (i) any suit, proceeding, investigation, order,
consent order, injunction, writ, award, or action relating to or affecting or
indicating the Treatment of any Hazardous Material upon, in, from or which
affects the Mortgaged Estate; (ii) any spill, contamination, discharge, leakage,
release or escape of any Hazardous Material upon, in, from or affecting the
Mortgaged Estate, whether sudden or gradual, accidental or anticipated, or of
any other nature ("Spill"); (iii) any dispute relating to any Spill or to Fine
Host's or any other party's Treatment of any Hazardous Material upon, in, from
or affecting the Mortgaged Estate; (iv) any claims by or against any insurer
related to or arising out of any Spill or the Treatment of any Hazardous
Material upon, in, from or affecting the Mortgaged Estate; (v) any
recommendations or requirements of any governmental or regulatory authority,
insurer or board of underwriters relating to any Spill or to any Treatment of
Hazardous Material upon, in, from or affecting the Mortgaged Estate, (vi) any
legal requirement or breach thereof related to any Spill or to the Treatment of
Hazardous Material upon, in, from or affecting the Mortgaged Estate; or (vii)
any tenant, licensee, concessionaire, manager, or other party or entity
occupying or using the Mortgaged Estate or any part thereof having engaged in or
engaging in the Treatment of any Hazardous Material upon, in, from or affecting
the Mortgaged Estate.
(d) In the event that (i) Fine Host causes, suffers or permits, directly
or indirectly, any Spill, or (ii) any Spill has occurred during the term of this
Mortgage, then Fine Host shall immediately take all of the following actions:
(A) notify the Administrative Agent as provided in Section 6.04; (B) devise a
plan (the "Clean-up Plan") for the assessment, clean-up, remediation and removal
of the Spill and any contamination related to the Spill, which Clean-up Plan
must be approved by the Administrative Agent and, if required by any
Environmental Law, any applicable governmental or regulatory authority, prior to
any such clean-up, remediation or removal; (C) take all steps necessary or
desirable in the Administrative Agent's reasonable judgment, and otherwise in
accordance with the Clean-up Plan, to clean up any such Spill or any
contamination related to such Spill; (D) fully restore the Mortgaged Estate to
its condition prior to the Spill; (E) allow the Administrative Agent to monitor
and inspect all cleanup and restoration related to such Spill; and (F) post a
bond with the Administrative Agent (drawn upon a company satisfactory to the
Administrative Agent) or deposit an amount of money in an escrow account under
the Administrative Agent's name upon which bond or escrow the Administrative
Agent may draw, and which bond or escrow shall be in an amount sufficient in the
Administrative Agent's reasonable judgment to meet all of Fine Host's
obligations under this subparagraph. Notwithstanding anything contained herein
to the contrary, in the event that Fine Host receives a written complaint for
any cleanup, removal or restoration of the Mortgaged Estate to the extent
mandated by any public official acting lawfully under any Environmental laws,
Fine Host shall not be considered in default of its obligations under this
subparagraph if Fine Host is contesting such complaint in good faith and the
enforcement thereof is withheld pending such contest. The Administrative Agent
shall have the right to draw against the bond or escrow in its discretion in the
event that Fine Host does not meet its obligations under this subparagraph. In
addition to the foregoing right to draw against any bond or escrowed funds, the
Administrative Agent, as its election and in it sole discretion, may (but shall
not be obligated to) otherwise cure any failure on the part of Fine Host or any
occupant of the Mortgaged Estate to comply with the Environmental Laws,
including, without limitation, taking any or all of the following actions:
(x) arrange and pay for the assessment, cleanup or containment
of Hazardous Material found on the Mortgaged Estate, provided, however,
except in the event of an emergency when immediate action is required as
determined by the Administrative Agent in its sole discretion, the
Administrative Agent shall not institute any remedial action hereunder
without first having given Fine Host the opportunity to take the actions
set forth in this subparagraph;
(y) pay on behalf of Fine Host or any other occupant of the
Mortgaged Estate, any fines or penalties imposed by any governmental or
regulatory authority in connection with such Hazardous Material; and
(z) make any other payment or perform any other act which may
prevent or abate a release or threat of release of Hazardous Material,
facilitate the cleanup thereof, or prevent a lien from attaching to the
Mortgaged Estate.
Any partial exercise by the Administrative Agent of the remedies set
forth in this subparagraph or any partial undertaking on its part to cure Fine
Host's or any other occupant of the Mortgaged Estate's failure to comply with
the Environmental Laws, shall not obligate the Administrative Agent to complete
the actions taken or to expend further sums to cure such noncompliance; neither
shall the exercise of any such remedies operate to place upon the Administrative
Agent any responsibility for the operation, control, care, management or repair
of the Mortgaged Estate, provided, however, except in the event of an emergency
when immediate action is required as determined by the Administrative Agent in
its sole discretion, the Administrative Agent shall not institute any remedial
action hereunder without first having given Fine Host the opportunity to take
the actions set forth in this subparagraph.
Any amounts paid or costs incurred by the Administrative Agent as a
result of any of the above shall be a cost incurred for the protection of the
Mortgaged Estate and shall be immediately due and payable by Fine Host, and
until paid shall be added to and become a part of the indebtedness and
obligations secured by this Mortgage; and the Administrative Agent, by making
any such payment or incurring any such costs, shall be subrogated to any rights
of Fine Host or any occupant of the Mortgaged Estate to seek reimbursement of
such costs from any third parties, including, without limitation, any
"responsible party" under the Environmental Laws.
(e) the Administrative Agent shall have the right, but not the
obligation, to enter upon, inspect, monitor and conduct, at Fine Host's sole
cost and expense, such environmental tests and surveys of the Mortgaged Estate
and Fine Host's use of the Mortgaged Estate as the Administrative Agent deems
appropriate in order to determine Fine Host's compliance with the terms of this
Section 1.24 and the representations and warranties set forth in this Section
1.24.
(f) Fine Host hereby represents, warrants and confirms that: (i) neither
Fine Host nor, to the best of Fine Host's knowledge, any other person is engaged
or has ever engaged, in the Treatment of any Hazardous Material upon, in, from
or affecting the Mortgaged Estate; (ii) Fine Host, to the best of its knowledge,
has complied with all Environmental Laws relating to the Treatment of any
Hazardous Material upon, in, from or affecting the Mortgaged Estate; (iii) there
is no suit, claim, proceeding, investigation, order, consent order, injunction,
writ, award, or action threatened, pending, or in effect, which relates to the
Treatment of any Hazardous Material upon, in, from or affecting the Mortgaged
Estate and which involves or affects Fine Host or the Mortgaged Estate; nor does
Fine Host know of any basis for any such suit, claim, proceeding, investigation,
order, consent order, injunction, writ, award or action; (iv) there are no, nor,
to the best of Fine Host's knowledge, have there ever been any, underground (or
partially underground) tanks of any kind at the Mortgaged Estate; (v) to the
best of Fine Host's knowledge, no governmental or regulatory authority,
including, without limitation, the United States Environmental Protection Agency
has made a determination or finding that (A) Fine Host or any other person or
entity engaged, engages, or will engage in the Treatment of any Hazardous
Material upon, in, from or affecting the Mortgaged Estate; (B) there exists or
existed any underground (or partially underground) tanks of any kind at the
Mortgaged Estate; or (C) Fine Host is a transporter of Hazardous Material; or
(D) there has been any past or present Spill; (vi) to the best of Fine Host's
knowledge, after due diligence and investigation, no agent, tenant, licensee,
concessionaire, manager, or other party or entity occupying or using the
Mortgaged Estate or any part thereof has engaged in or engages in the Treatment
of any Hazardous Material upon, in, from or affecting the Mortgaged Estate; and
(vii) Fine Host has not received any Notice, and is not aware of the existence
of any Notice. Fine Host shall immediately notify the Administrative Agent in
the event that any of the representations set forth in this subparagraph are no
longer true in any material respect at any time.
(g) Fine Host covenants and agrees that all leases, licenses and
agreements of any kind hereafter executed which permit any party to occupy,
possess, or use in any way the Mortgaged Estate or any part thereof, whether
oral or written (collectively, the "Leases") shall include an express
prohibition of the Treatment of any Hazardous Material upon, in, from or
affecting the Mortgaged Estate (except in compliance with Environmental Laws),
and the failure to comply with such prohibition shall expressly constitute a
default under any such Lease. All Leases shall also expressly require that the
parties to such Leases shall deliver upon request estoppel certificates to Fine
Host and to the Administrative Agent expressly stipulating whether any party to
such Lease is engaged in or has engaged in the Treatment of any Hazardous
Material upon, in, from or affecting the Mortgaged Estate, and whether such
party has caused a Spill and whether, to the best of their knowledge, a Spill
has otherwise occurred.
(h) Notwithstanding anything in this Mortgage to the contrary, the
representations and undertakings of Fine Host in this Section 1.24 shall survive
the expiration or termination of this Mortgage regardless of the means of such
expiration or termination.
(i) Fine Host expressly agrees that in the event Fine Host fails, in any
material respect, in any of its obligations under this Section 1.24, such
failure shall constitute an Event of Default hereunder, the Administrative Agent
shall have the right, at its sole option, to exercise any and all rights and
remedies granted to the Administrative Agent hereunder and/or by law or in
equity, including but not limited to the right to foreclose the lien of this
Mortgage.
ARTICLE II
ADMINISTRATIVE AGENT'S POWERS
At any time, or from time to time, without liability therefor, and
without affecting the personal liability, if any, of any person for payment of
the Secured Obligations or the effect of this Mortgage upon the remainder of the
Mortgaged Estate, the Administrative Agent may without notice (i) release any
part of the Mortgaged Estate, (ii) consent in writing to the making of any map
or plan thereof, (iii) join in granting any easement thereon, (iv) join in any
extension agreement or any agreement subordinating the lien or charge hereof,
(v) release any person so liable, (vi) extend the maturity or alter any of the
terms of any Secured Obligations, (vii) grant other indulgences, (viii) take or
release any other or additional security for any obligation herein mentioned,
(ix) make compositions or other arrangements with debtors in relation thereto,
or (x) advance additional funds to protect the security hereof and pay or
discharge the Secured Obligations of Fine Host hereunder, and all amounts so
advanced shall be secured hereby and shall be due and payable upon demand by the
Administrative Agent.
ARTICLE III
ASSIGNMENT OF RENTS
Fine Host hereby assigns and transfers to the Administrative Agent, for
the ratable benefit of the Banks, all of the rents, issues and profits of the
Mortgaged Estate. The terms of such assignment are more specifically set forth
in the Conditional Assignment of Rentals which terms, by this reference, are
incorporated herein.
ARTICLE IV
SECURITY AGREEMENT
Section 4.01. Creation of Security Interest. With respect to any portion
of the Mortgaged Estate which constitutes Personal Property, fixtures or other
property governed by the UCC, including, without limitation, the Collateral,
this Mortgage shall constitute a security agreement between Fine Host as the
debtor and the Administrative Agent as the secured party, and Fine Host hereby
grants to the Administrative Agent, for the ratable benefit of the Banks, a
security interest in such portion of the Mortgaged Estate. Cumulative of all
other rights of the Administrative Agent hereunder, the Administrative Agent
shall have all of the rights conferred upon secured parties by the UCC. Fine
Host will execute and deliver to the Administrative Agent all financing and
continuation statements and other information that are from time to time
required or appropriate to establish and maintain the validity and priority of
the security interest of the Administrative Agent, or any modification thereof,
and pay all costs and expenses of any searches required by the Administrative
Agent. The Administrative Agent may exercise any or all of the remedies of a
secured party available to it under the UCC with respect to such property, and
it is expressly agreed that if upon an Event of Default (as herein defined) the
Administrative Agent should proceed to dispose of such property in accordance
with the provisions of the UCC, seven (7) days' notice by the Administrative
Agent to Fine Host shall be deemed to be reasonable notice under any provision
of the UCC requiring such notice; provided, however, that the Administrative
Agent may at its option dispose of such property in accordance with the
Administrative Agent's rights and remedies with respect to the real property
pursuant to the provisions of this Mortgage, in lieu of proceeding under the
UCC.
Without in any way derogating from the Administrative Agent's consent
rights contained in Section 1.21 hereof, Fine Host shall give advance notice in
writing to the Administrative Agent of any proposed change in Fine Host's name,
identity, address, or business form or structure and will execute and deliver to
the Administrative Agent, prior to or concurrently with the occurrence of any
such change, all additional financing statements that the Administrative Agent
may require to establish and maintain the validity and priority of the
Administrative Agent's security interest with respect to any of the Mortgaged
Estate described or referred to herein.
Some of the items of the Mortgaged Estate described herein are goods
that are or are to become fixtures related to the Property, and it is intended
that as to those goods, this Mortgage shall be effective as a financing
statement filed as a fixture filing from the date of its filing for record in
the real estate records of the county in which the Mortgaged Estate is situated.
Information concerning the security interest created by this instrument may be
obtained from the Administrative Agent, as secured party, and from Fine Host, as
debtor, at the addresses stated in Section 6.04 of this Mortgage.
Section 4.02. Warranties, Representations and Covenants of Fine Host.
Fine Host hereby warrants, represents and covenants, with respect to the
Personal Property that all covenants and obligations of Fine Host contained
herein relating to the Mortgaged Estate shall be deemed to apply to the Personal
Property whether or not expressly referred to herein.
ARTICLE V
REMEDIES UPON DEFAULT
Section 5.01. Acceleration Upon Default; Additional Remedies.
Upon the occurrence of an Event of Default, the Administrative Agent may:
(i) Declare all Secured Obligations to be due and payable, and
the same shall thereupon become due and payable without any presentment,
demand, protest or notice of any kind except as otherwise provided
herein, and Fine Host hereby waives notice of intent to accelerate the
Secured Obligations, all subject to the provisions of the Loan
Agreement;
(ii) Either in person or by agent, with or without bringing any
action or proceeding, or by a receiver appointed by a court, and without
regard to the adequacy of its security, enter upon and take possession
of the Mortgaged Estate or any part thereof and do any acts which it
deems necessary or desirable to preserve the value, marketability or
rentability of the Mortgaged Estate, or part thereof or interest
therein, increase the income therefrom or protect the security hereof
and, with or without taking possession of the Mortgaged Estate, take any
action described in Articles II, III or IV hereof, sue for or otherwise
collect the rents, issues and profits thereof, including those past due
and unpaid, and apply the same, less costs and expenses of operation and
collection including reasonable attorneys' fees, upon any Secured
Obligations, all in such order as the Administrative Agent may
determine. The entering upon and taking possession of the Mortgaged
Estate, the taking of any action described in Articles II, III or IV
hereof, the collection of such rents, issues and profits and the
application thereof as aforesaid, shall not cure or waive any default or
notice of default or invalidate any act done in response to such default
or pursuant to such notice of default and, notwithstanding the
continuance in possession of the Mortgaged Estate or the collection,
receipt and application of rents, issues or profits, the Administrative
Agent shall be entitled to exercise every right provided for in any of
the Loan Documents or by law upon occurrence of any Event of Default,
including the right to exercise the power of sale herein conferred;
(iii) Commence an action to foreclose this Mortgage, appoint a
receiver, specifically enforce any of the covenants hereof, or sell the
Mortgaged Estate pursuant to the power of sale herein conferred;
(iv) Exercise any or all of the remedies available to a secured party under
the UCC; and
(v) Apply any sums or amounts received pursuant to Section 1.05
or Section 1.12 hereto, or as rents or income of the Mortgaged Estate or
otherwise, upon any Secured Obligation in such manner and order as the
Administrative Agent may elect. The receipt, use or application of any
such sums by the Administrative Agent hereunder shall not be construed
to affect the maturity of any Secured Obligation or any of the rights or
powers of the Administrative Agent under the terms of the Loan Documents
or any of the obligations of Fine Host or any of the other Borrowers.
Section 5.02. Appointment of Receiver. If an Event of Default shall have
occurred, the Administrative Agent, as a matter of right and without notice to
Fine Host or anyone claiming under Fine Host or any other party, and without
regard to the then value of the Mortgaged Estate or the interest of Fine Host
therein, shall have the right to apply to any court having jurisdiction to
appoint a receiver or receivers of the Mortgaged Estate, and Fine Host hereby
irrevocably consents to such appointment and waives notice of any application
therefor. Any such receiver or receivers shall have all the usual powers and
duties of receivers in like or similar cases and all the powers and duties of
the Administrative Agent in case of entry as provided in Section 5.01(ii) and
shall continue as such and exercise all such powers until the date of
confirmation of sale of the Mortgaged Estate unless such receivership is sooner
terminated.
Section 5.03 Remedies Not Exclusive. The Administrative Agent shall be
entitled to enforce payment and performance of any Secured Obligations hereby
and to exercise all rights and powers under this Mortgage or under any Loan
Documents or other agreement or any laws now or hereafter in force,
notwithstanding some or all of the Secured Obligations may now or hereafter be
otherwise secured, whether by mortgage, deed of trust, pledge, lien, assignment
or otherwise. Every power or remedy given by any of the Loan Documents to the
Administrative Agent, or to which the Administrative Agent may be otherwise
entitled, may be exercised without prejudice to any other power or remedy,
concurrently, independently, in any order and in any manner from time to time
and as often as may be deemed expedient by the Administrative Agent. No remedy
or power is intended to be exclusive of any other power or remedy and the
Administrative Agent may pursue inconsistent remedies.
The acceptance by any of the Agents or the Banks of any sum after the
same is due shall not constitute a waiver of the right either to require prompt
payment, when due, of all other sums hereby secured or to declare a default as
herein provided. The acceptance by any of the Agents or the Banks of any sum in
an amount less than the sum then due shall be deemed an acceptance on account
only and upon condition that it shall not constitute a waiver of the obligation
of Fine Host to pay the entire sum then due, and failure of Fine Host to pay
such entire sum then due shall be and continue to be an Event of Default
notwithstanding such acceptance of such amount on account, as aforesaid. Consent
by any of the Agents or the Banks to any action or inaction of Fine Host which
is subject to consent or approval of the Administrative Agent hereunder shall
not be deemed a waiver of the right to require such consent or approval to
future or successive actions or inactions. Nothing contained in this Mortgage
shall be construed to constitute any of the Agents or the Banks as a "mortgagee
in possession" in the absence of its taking actual possession of the Mortgaged
Estate pursuant to the powers granted herein.
Section 5.04 Marshalling. Notwithstanding the existence of any other
security interest in the Mortgaged Estate held by the Administrative Agent or by
any other party, the Administrative Agent shall have the right to determine the
order in which any of the Mortgaged Estate or any part thereof shall be
subjected to the remedies provided herein. The Administrative Agent shall have
the right to determine the order in which any or all portions of the Secured
Obligations are satisfied from the proceeds realized upon the exercise of the
remedies provided herein. Fine Host and any party who now or hereafter acquires
a security interest in any of the Mortgaged Estate and who has actual or
constructive notice hereof hereby waives, to the extent permitted by law, any
and all right to require the marshalling of assets in connection with the
exercise of any of the remedies permitted by applicable law or provided herein.
ARTICLE VI
MISCELLANEOUS
Section 6.01. Governing Law. This Mortgage shall be governed by the laws
of the Commonwealth of Kentucky. Fine Host agrees that if Fine Host is not
domiciled in Kentucky or does not have a registered agent in Kentucky, together
with and in addition to any other reason permitted by law, the Administrative
Agent may serve Fine Host through service on Kentucky's Secretary of State as
per Kentucky's "long-arm" statue. Service through the Secretary of State shall
bring Fine Host personally before the court as well as bring the real estate
before the court. The last known address of Fine Host shall be considered the
address given for Fine Host in the opening paragraph of this Mortgage unless
Fine Host notifies the Administrative Agent in writing, of another address. Fine
Host agrees to hold each of the Agents and the Banks harmless from and against
any technical objections which Fine Host may have to service, if in fact Fine
Host knew about the lawsuit or should have known but for willful or gross
negligence of Fine Host.
Section 6.02. Conflicts, Modifications. In the event that any provision
or clause of this Mortgage conflicts with applicable laws, such conflicts shall
not affect other provisions of this Mortgage which can be given effect without
the conflicting provision, and to this end the provisions of this Mortgage are
declared to be severable. This instrument cannot be waived, changed, discharged
or terminated orally, but only by an instrument in writing signed by the party
against whom enforcement of any waiver, change, discharge or termination is
sought.
Section 6.03. Waiver of Rights. To the extent permitted by law, Fine
Host waives the benefit of all laws now existing or that hereafter may be
enacted (i) providing for any appraisement before sale of any portion of the
Mortgaged Estate, (ii) providing for a jury trial on any issues pertaining to
the Loan Documents or any liability of Fine Host or (iii) in any way extending
the time for the enforcement of the collection of the Secured Obligations or
creating or extending a period of redemption from any sale made in collecting
the Secured Obligations. To the full extent Fine Host may do so, Fine Host
agrees that Fine Host will not at any time insist upon, plea, claim or take the
benefit or advantage of any law now or hereafter in force providing for any
appraisement, valuation, stay, extension, redemption or homestead exemption, and
Fine Host, for Fine Host, Fine Host's representatives, heirs, successors and
assigns, and for any and all persons ever claiming any interest in the Mortgaged
Estate, to the extent permitted by law, hereby waives and releases all rights of
redemption, valuation, appraisement, stay of execution, homestead exemption,
notice of election to mature or declare due the whole of the Secured Obligations
and marshalling in the event of foreclosure of the liens hereby created.
Section 6.04. Notices. Except as otherwise expressly provided herein,
any notice required or desired to be served, given or delivered hereunder shall
be in writing, and shall be deemed to have been validly served, given or
delivered upon the earlier of (a) personal delivery to the address set forth
below, (b) in the case of mailed notice, three (3) days after deposit in the
United States mails, with proper postage for certified mail, return receipt
requested, prepaid, (c), in the case of telecopy notice, when received or (d) in
the case of notice by Federal Express or other reputable overnight courier
service, one (1) Business Day after delivery to such courier service, addressed
as follows, or to such other address as may be hereafter notified by the
respective parties hereto:
(i) If to the Administrative Agent, at:
BankBoston, N.A.
100 Federal Street
Boston, MA 02110
Attention: Daniel P. Corcoran, Jr., Director
Mail Code: 01-07-05
Telecopier No. 617-434-1279
with a copy to:
Peabody & Arnold
50 Rowes Wharf
Boston, MA 02110
Attention: Anil Khosla, Esq.
Telecopier No. 617-951-2125
(iii) If to Fine Host, at:
Fine Host Corporation
3 Greenwich Office Park
Greenwich, CT 06831
Attention: Richard E. Kerley, Chairman and CEO
Telecopier No. 203-629-5089
with a copy to:
Willkie Farr & Gallagher
One Citicorp Center
153 East 53rd Street
New York, NY 10022
Attention: Cornelius T. Finnegan, III, Esq.
Telecopier No. 212-821-8111
Section 6.05. Rules of Construction. When the identity of the parties
hereto or other circumstances make it appropriate, the masculine gender includes
the feminine and/or neuter, and the singular number includes the plural. The
headings of each Article, Section and paragraph are for information and
convenience only and do not limit or construe the contents of any provision
hereof. The relationship created herein is one of debtor and creditor and shall
not be construed to create a partnership, venture or any other relationship
between Fine Host and the Administrative Agent. To the extent any conflict or
inconsistency exists in this Mortgage and/or any of the Loan Documents, Fine
Host shall first be bound by the terms of the Loan Agreement, then the terms of
the other Loan Documents and then the terms of this Mortgage.
Section 6.06. Successors in Interest. This Mortgage applies to, inures
to the benefit of, and is binding not only on the parties hereto, but also on
their heirs, executors, administrators, successors and assigns.
Section 6.07. Covenants Run with the Land. All the grants, covenants,
terms provisions and conditions herein shall run with the land.
Section 6.08. Counterparts. This Mortgage may be executed in any number
of counterparts and each of such counterparts shall for all purposes be deemed
to be an original; and all such counterparts shall together constitute but one
and the same Mortgage.
Section 6.09. Subrogation. To the extent that proceeds of the Notes or
advances under this Mortgage are used to pay any outstanding lien, charge or
prior encumbrance against the Mortgaged Estate, such proceeds or advances have
been or will be advanced by the Administrative Agent at Fine Host's request, and
the Administrative Agent shall be subrogated to any and all rights and liens
held by any owner or holder of such outstanding liens, charges and prior
encumbrances, irrespective of whether said liens, charges or encumbrances are
released of record.
Section 6.10. Assignment of the Administrative Agent's Interest. Subject
to the provisions of subsection 10.15 of the Loan Agreement, Fine Host hereby
specifically grants unto the Administrative Agent the right and privilege, at
the Administrative Agent's option, to transfer and assign to any third person
all or any portion of the Administrative Agent's interest and obligations
hereunder. Upon any such transfer, Fine Host, at the Administrative Agent's
request, shall provide an estoppel certificate to such third person in form and
content satisfactory to the Administrative Agent, in its reasonable discretion.
IN WITNESS WHEREOF, Fine Host has caused this Mortgage to be executed
under seal on the day and year set forth in the acknowledgement set forth below,
all as of the day and year first written above.
FINE HOST CORPORATION
By: ________________________________________
Name:
Title:
Its duly authorized officer
<PAGE>
STATE OF ____________________
COUNTY OF ____________________
The foregoing instrument was acknowledged before me on this ____ day of
July, 1997, by ___________________________________, as ____________________, of
FINE HOST CORPORATION, a Delaware corporation, for and on behalf of said
corporation, pursuant to duly authorized resolution.
----------------------------------
Notary Public
----------------------------------
Print Name of Notary
My Commission Expires:
[AFFIX NOTARIAL SEAL]
This instrument prepared by and after recorded return to:
- -------------------------------
Sharon S. Elliston, Esq.
Ziegler & Schneider, P.S.C.
7300 Turfway Road, Suite 505
Florence, KY 41042
<PAGE>
EXHIBIT A
Property Description
<PAGE>
EXHIBIT N
CONDITIONAL ASSIGNMENT OF RENTALS, PROFITS AND INCOME
This CONDITIONAL ASSIGNMENT OF RENTALS, PROFITS AND INCOME (this
"Assignment") is made as of July 30, 1997, by and between (a) FINE HOST
CORPORATION, a Delaware corporation, with its principal place of business at 3
Greenwich Office Park, Greenwich, Connecticut 06831 (together with its
successors and assigns, "Fine Host") and (b) BANKBOSTON, N.A., as Administrative
Agent (in such capacity, the "Administrative Agent") for various banks and other
financial institutions which are or may hereafter become parties (said banks and
other financial institutions are hereinafter referred to collectively as the
"Banks") to that certain Fourth Amended and Restated Loan Agreement, dated of
even date herewith (as the same may be hereafter further amended, modified,
supplemented, extended or restated, from time to time, the "Loan Agreement") by
and among Fine Host, all of the Subsidiaries of Fine Host, the Administrative
Agent, USTrust as Documentation Agent for the Banks (in such capacity, the
"Documentation Agent")(the Administrative Agent and the Documentation Agent are
hereinafter sometimes referred to collectively as the "Agents") and the Banks.
Reference is hereby made to a certain Mortgage, Security Agreement, and
Financing Statement, dated of even date herewith (as the same may be hereafter
amended, modified, supplemented, extended or restated, from time to time, the
"Mortgage"), from Fine Host in favor of the Administrative Agent, which relates
to the Mortgaged Estate (including, without limitation, the Property that is
more particularly described on Exhibit A attached hereto and incorporated herein
by reference (the "Property")) and which is to be recorded contemporaneously
with this Assignment. All capitalized terms not defined herein but defined in
the Mortgage shall have the meanings given to such terms in the Mortgage, and if
not defined in the Mortgage, then the meanings given to such terms in the
Uniform Commercial Code, as in effect, from time to time, in the Commonwealth of
Kentucky (the "UCC").
Preliminary Statements:
WHEREAS, Fine Host and all of its Subsidiaries have requested that the
Existing Banks amend and restate in its entirety the Existing Loan Agreement in
the manner provided in the Loan Agreement; and
WHEREAS, it is a condition precedent to the effectiveness of the Loan
Agreement and to the obligations of the Banks to make Extensions of Credit
provided for therein that Fine Host shall have entered into this Assignment;
NOW, THEREFORE, in consideration of the premises contained herein, and
to induce the Banks to amend and restate the Existing Loan Agreement, as
provided in the Loan Agreement, and to induce the Banks to make Extensions of
Credit under the Loan Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Fine Host agrees
as follows:
1. Assignment; Certain Rights of Fine Host. To secure further the
Secured Obligations, Fine Host hereby assigns, transfers, conveys and sets over
to the Administrative Agent, for the ratable benefit of the Banks, all of Fine
Host's estate, right, title and interest in, to and under all leases, occupancy
agreements and guaranties thereof, whether existing on the date hereof or
hereafter entered into (including any extensions, modifications or amendments
thereto) relating to the Property (the "Leases"), together with all rights,
powers, privileges, options and other benefits of Fine Host as the lessor under
the Leases regarding the current tenants and any future tenants, and all the
rents, issues, royalties, revenues, profits, and income from the Mortgaged
Estate (collectively the "Rents"), including without limitation, those now due,
past due or to become due. Fine Host irrevocably appoints the Administrative
Agent its true and lawful attorney-in-fact, at the option of the Administrative
Agent at any time and from time to time, upon the occurrence and during the
continuance of an Event of Default, to take possession and control of the
Mortgaged Estate, pursuant to Fine Host's rights as lessor under the Leases, and
to demand, receive and enforce payment, to give receipts, releases and
satisfaction and to sue, in the name of Fine Host or the Administrative Agent,
for all Rents.
Notwithstanding the foregoing, however, so long as no Event of Default
has occurred and is continuing, Fine Host shall have a revocable license to
possess and control the Mortgaged Estate and collect, receive and use all Rents
for Fine Host's benefit. Upon the occurrence and during the continuance of any
Event of Default, such license shall be deemed to have been automatically
revoked by the Administrative Agent without requirement of notice to Fine Host
or any further action on the part of the Administrative Agent.
Upon the occurrence and during the continuance of any Event of Default,
the Administrative Agent may, at any time without notice, either in person, by
agent or by a court-appointed receiver, regardless of the adequacy of the
Administrative Agent's security, enter upon and take possession and control of
the Mortgaged Estate, or any part thereof, to perform all acts necessary and
appropriate to operate and maintain the Mortgaged Estate including, but not
limited to, execute, cancel or modify the Leases (subject to the rights of third
parties), make repairs to the Mortgaged Estate, execute or terminate contracts
providing for the management or maintenance of the Mortgaged Estate (subject to
the rights of third parties), all on such terms as are deemed best to protect
the security of this Assignment. The Administrative Agent may also, at any time
without notice, either in person, by agent or by a court-appointed receiver,
regardless of the adequacy of the Administrative Agent's security and regardless
of whether the Administrative Agent has taken possession and control of the
Mortgaged Estate, in the Administrative Agent's or Fine Host's name, demand, sue
for or otherwise collect such Rents from the Mortgaged Estate as specified in
this Assignment as the same become due and payable, including, but not limited
to, Rents then due and unpaid.
Upon the occurrence and during the continuance of an Event of Default,
all Rents collected shall immediately be held by Fine Host as trustee for the
benefit of the Administrative Agent only. Fine Host agrees that commencing upon
the occurrence of such Event of Default, each tenant of the Mortgaged Estate
shall make its Rent payable to and pay such Rent to the Administrative Agent on
the Administrative Agent's written demand therefor, without any liability on the
part of said tenant to inquire further as to the existence of an Event of
Default.
All Rents collected subsequent to the occurrence of any Event of Default
shall be applied at the discretion of, and in such order as determined by, the
Administrative Agent, to the costs, if any, of taking possession and control of
and managing the Mortgaged Estate (if applicable) and collecting such amounts,
including, but not limited to, reasonable attorney's fees, receiver's fees,
premiums on receiver's bonds, costs of repairs to the Mortgaged Estate, premiums
on insurance policies, taxes, assessments and other charges on the Mortgaged
Estate, and the costs of discharging any obligation or liability of Fine Host as
lessor or landlord of the Mortgaged Estate and to the Secured Obligations. The
Administrative Agent or the receiver shall have access to the books and records
used in the operation and maintenance of the Mortgaged Estate and shall be
liable to account only for those rents actually received. The Administrative
Agent shall not be liable to Fine Host, anyone claiming under or through Fine
Host or anyone having an interest in the Mortgaged Estate by reason of anything
done or left undone by the Administrative Agent hereunder, unless such liability
is the result of the Administrative Agent's gross negligence or willful
misconduct.
If the Rents are not sufficient to meet the costs, if any, of taking
possession and control of and managing the Mortgaged Estate and collecting the
same, any funds expended by any of the Agents or the Banks for any and all of
such purposes shall become Secured Obligations.
Any entering upon and taking possession and control of the Mortgaged
Estate by the Administrative Agent or the receiver and any application of Rents
as provided herein shall not waive any Event of Default or invalidate any other
right or remedy of the Administrative Agent.
Fine Host hereby represents and agrees that it is and, except as
otherwise permitted by the Loan Agreement, will be the sole owner of the entire
landlord's interest in all Leases, subject only to Permitted Encumbrances.
2. Certain Agreements of Fine Host. Fine Host hereby agrees as follows:
(a) If any of the Leases provide for a security deposit or last
months rent amount (hereinafter referred to as the "Deposits") paid by
the tenant thereunder, this Assignment shall transfer to the
Administrative Agent, for the ratable benefit of the Banks, all of Fine
Host's right, title and interest in and to such Deposits; provided that,
(i) Fine Host shall have the right to retain such Deposits so long as no
Event of Default shall have occurred and be continuing; (ii) all such
Deposits shall be held in a deposit account at the Administrative Agent
and Fine Host hereby grants the Administrative Agent, for the ratable
benefit of the Banks, a security interest in such deposit account and
(iii) notwithstanding the foregoing, nothing herein shall impose any
obligation on any of the Agents or the Banks to Fine Host or to any such
tenant with respect to such Deposits;
(b) Fine Host shall provide semi-annually beginning six (6)
months from the date hereof a current rent roll setting forth the name,
status, term, rental amount, deposit and other amounts held, tax
escalation and like obligations of each tenant, if any, and any other
information which the Administrative Agent may from time to time
reasonably request, certified by Fine Host to be true and complete.
(c) Fine Host shall faithfully perform and discharge all
obligations of the landlord under the Leases, and shall give prompt
written notice to the Administrative Agent of any notice of Fine Host's
default received from the tenant or any other person and shall furnish
the Administrative Agent with a complete copy of said notice. Fine Host
shall appear in and defend, at no cost to the Administrative Agent, any
action or proceeding arising under or in any manner connected with the
Leases. If requested by the Administrative Agent, Fine Host shall
enforce any Lease and all remedies available to Fine Host against the
tenant in the case of default under such Lease by the tenant thereunder;
(d) Upon the request of the Administrative Agent, Fine Host shall promptly
provide to the Administrative Agent a true and correct copy of all Leases;
(e) In any and all leases and occupancy arrangements entered
into by Fine Host after the date hereof, Fine Host agrees to impose upon
all tenants the obligation to comply in all respects with the provisions
of all Federal, state and local environmental protection laws, rules,
ordinances and regulations, and to indemnify Fine Host and Fine Host's
successors and assigns, and save them harmless, from any and all
liability, costs and expenses associated with non-compliance with such
laws, rules, ordinances and regulations, subject to customary exceptions
and qualifications; and
(f) Nothing herein shall be construed to constitute the
Administrative Agent as a "mortgagee in possession" in the absence of
its taking of actual possession of the Mortgaged Estate pursuant to the
powers granted herein, or to impose any liability or obligation on the
Administrative Agent under or with respect to the Leases. Prior to the
Administrative Agent taking actual possession of the Mortgaged Estate,
Fine Host shall indemnify and hold each of the Agents and the Banks
harmless from and against any and all liabilities, losses and damages
(including reasonable attorneys' fees and costs) that any of the Agents
or the Banks may incur under the Leases or by reason of this Assignment,
and of and from any and all claims and demands whatsoever that may be
asserted against the Administrative Agent by reason of any alleged
obligations to be performed or discharged by the Administrative Agent
under the Leases or this Assignment (other than any liabilities, losses,
damages, claims and demands resulting from the wilful misconduct or
gross negligence of any such Agent or Bank). Any Rent collected by
Administrative Agent may be applied by the Administrative Agent in its
discretion in satisfaction of any such liability, loss, damage, claim,
demand, costs, expense or fees.
3. Rights and Remedies of Administrative Agent. If an Event of Default
occurs, the Administrative Agent shall have the following rights and remedies,
all of which are cumulative, in addition to all other rights and remedies
provided under the Loan Documents, or any other agreement between Fine Host and
the Administrative Agent, or otherwise available at law or in equity or by
statute: (a) the Administrative Agent shall be deemed to be the creditor of each
tenant in respect of any assignments for the benefit of creditors and any
bankruptcy, arrangement, reorganization, insolvency, dissolution, receivership
or other debtor-relief proceedings affecting the tenant (without obligation on
the part of the Administrative Agent, however, to file timely claims in such
proceedings or otherwise pursue creditor's rights therein); and (b) the
Administrative Agent shall have the right to assign Fine Host's right, title and
interest under this Assignment in any of the Leases to any subsequent holder or
holders of either or both of the Notes or any participating interest therein or
to any person acquiring title to the Mortgaged Estate or any part thereof
through foreclosure or otherwise. Any subsequent assignee shall have all the
rights and powers herein provided to the Administrative Agent.
4. Additional Security. The Administrative Agent may take or release
other security for the Secured Obligations, may release any party primarily or
secondarily liable therefor and may apply any other security held by it to the
satisfaction of Secured Obligations, without prejudice to any of its rights
under this Assignment.
5. Assignment; Release. The assignment contained herein and all rights
herein assigned to the Administrative Agent shall cease and terminate as to all
Leases: (a) upon the satisfaction of all Secured Obligations; or (b) upon the
release of the Mortgaged Estate subject to such Lease from the lien of the
Mortgage covering such Mortgaged Estate pursuant to the provisions of the
Mortgage.
It is expressly understood that no judgment or decree that may be
entered on any debt secured or intended to be secured by this Assignment shall
operate to abrogate or lessen the effect of this Assignment, but that the same
shall continue in full force and effect as herein provided. The provisions of
this Assignment shall also remain in full force and effect during the pendency
of any proceedings for the foreclosure and/or sale of the Mortgaged Estate, or
any part thereof, both before and after sale, until the issuance of a deed
pursuant to a decree of foreclosure and/or sale, unless all Secured Obligations
are fully satisfied pursuant to paragraph (a) of this section.
6. Effect on Rights Under Other Documents. Nothing contained in this
Assignment and no act done or omitted by the Administrative Agent pursuant to
the powers and rights granted it hereunder shall prejudice or be deemed to be a
waiver by the Administrative Agent of its rights and remedies under the Loan
Documents. The right of the Administrative Agent to collect the Secured
Obligations and to enforce any other security therefor held by it may be
exercised by the Administrative Agent either prior to, simultaneously with, or
subsequent to any action taken by it hereunder. This Assignment is intended to
be supplementary to and not in substitution for or in derogation of any
assignment of rents contained in the Mortgage or in any other document.
7. Further Assurances. Fine Host hereby agrees that it shall, whenever
and as often as it shall be requested to do so by the Administrative Agent,
execute, acknowledge and deliver, or cause to be executed, acknowledged, and
delivered, any and all such further conveyances, approvals, consents, memoranda
of the subject matter hereof, duplicate originals hereof, and any and all other
documents and to do any and all other acts as may be necessary or appropriate to
carry out the terms of this Assignment. This Assignment or a memorandum hereof
may be recorded by the Administrative Agent at any time.
8. No Waiver. A waiver by the Administrative Agent of any of its rights
hereunder or under the Leases or of a breach of any of the covenants and
agreements contained herein to be performed by Fine Host shall not be construed
as a waiver of such rights in any succeeding instance or of any succeeding
breach of the same or other covenants, agreements, restrictions or conditions.
9. Marshalling. Notwithstanding the existence of any other security
interest in the Mortgaged Estate held by the Administrative Agent or by any
other party, the Administrative Agent shall have the right to determine the
order in which any of the Mortgaged Estate or any part thereof shall be
subjected to the remedies provided herein. The Administrative Agent shall have
the right to determine the order in which any or all portions of the Secured
Obligations are satisfied from the proceeds realized upon the exercise of the
remedies provided herein. Fine Host and any party who now or hereafter acquires
a security interest in any of the Mortgaged Estate and who has actual or
constructive notice hereof hereby waives, to the extent permitted by law, any
and all right to require the marshalling of assets in connection with the
exercise of any of the remedies permitted by applicable law or provided herein.
10. Notices. All notices, demands, requests, consents, approvals or
communications required under this Assignment shall be in writing and shall be
deemed to have been properly given if sent in accordance with the notice
provisions contained in the Mortgage.
11. Governing Laws; Severability. This Assignment shall be governed by
and construed under the laws of the Commonwealth of Kentucky. In case any of the
provisions of this Assignment shall at any time be held by a court of competent
jurisdiction to be illegal, invalid, or unenforceable for any reason, such
illegality, invalidity or unenforceability shall not affect the remaining
provisions of this Assignment, and this Assignment shall be construed and
enforced as if all such illegal, invalid or unenforceable provisions had never
been inserted herein.
12. Conflicting Provisions. In the event of any conflict between the
provisions of this Assignment and those of the other Loan Documents, the other
Loan Documents shall govern.
IN WITNESS WHEREOF, Fine Host has executed this Assignment under seal
on the date first above written.
FINE HOST CORPORATION
By: ________________________________________
Name:
Title:
Its duly authorized officer
<PAGE>
STATE OF ______________________
COUNTY OF ____________________
The foregoing instrument was acknowledged before me on this ____ day of
July, 1997, by ___________________________________, as ____________________, of
FINE HOST CORPORATION, a Delaware corporation, for and on behalf of said
corporation, pursuant to duly authorized resolution.
----------------------------------
Notary Public
----------------------------------
Print Name of Notary
My Commission Expires:
[AFFIX NOTARIAL SEAL]
This instrument prepared by and after recording return to:
- ---------------------------------
Sharon S. Elliston, Esq.
Ziegler & Schneider, P.S.C.
7300 Turfway Road, Suite 505
Florence, KY 41042
<PAGE>
EXHIBIT A
Property Description
<PAGE>
EXHIBIT O
[FORM OF BORROWING CERTIFICATE]
BORROWING CERTIFICATE
Pursuant to the provisions of subsection 4.1(l) of that certain Fourth
Amended and Restated Loan Agreement, dated of even date herewith (as the same
may be hereafter further amended, modified, supplemented, extended or restated
from time to time, the "Loan Agreement") by and among Fine Host Corporation, a
Delaware corporation, and all of its Subsidiaries (collectively, the
"Borrowers"), BankBoston, N.A. as Administrative Agent, USTrust as Documentation
Agent, and certain banks and financial institutions which are or may hereafter
be parties thereto from time to time, the undersigned hereby certifies, on
behalf of the Borrowers, as follows:
1. The representation and warranties of the Borrowers set
forth in the Loan Agreement and each of the other Loan Documents or
which are contained in any certificate, document or financial or other
statement furnished pursuant to or in connection with the Loan
Agreement or any other Loan Document are true and correct on and as of
the date hereof with the same effect as if made on the date hereof,
except for representations and warranties expressly stated to relate to
a specific earlier date, in which case such representations and
warranties are true and correct as of such earlier date;
2. No Default or Event of Default has occurred and is
continuing as of the date hereof or will occur after giving effect to
the making of the Loans and the issuance of the Letters of Credit
requested to be made and/or issued on the date hereof or the
consummation of each of the transactions contemplated by the Loan
Documents; and
3. There are no liquidation or dissolution proceedings pending
or to the undersigned's knowledge threatened against any of the
Borrowers, nor has any other event occurred affecting or threatening
the legal existence of any of the Borrowers.
All capitalized terms not defined herein but defined in the Loan
Agreement shall have the meanings given to such terms in the Loan Agreement.
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed this instrument under
its seal as of this ___ day of July, 1997.
FINE HOST CORPORATION, AS BORROWER AGENT AS PROVIDED ON THE LOAN AGREEMENT
By:____________________________________
Name:
Title:
Its duly authorized officer
<PAGE>
EXHIBIT P
October 27, 1997
Donaldson, Lufkin and
Jenrette Securities Corporation
NationsBanc Montgomery Securities, Inc.
Smith Barney, Inc.
Piper Jaffray Inc.
c/o Donaldson, Lufkin and Jenrette
Securities Corporation
277 Park Avenue
New York, New Yorx 10005
Re: Fine Host Corporation --
$175,000,000 5% Convertible Subordinated Notes
due 2004 (the "Notes")
Ladies and Gentlemen:
We have acted as counsel for Fine Host Corporation, a Delaware corporation (the
"Company"), in connection with the sale by the Company and the purchase by
Donaldson, Lufkin & Jenrette Securities Corporation, NationsBanc Montgomery
Securities, Inc., Smith Barney Inc. and Piper Jaffray Inc. (collectively, the
"Initial Purchasers") of the Notes pursuant to the Purchase Agreement, dated
October 21, 1997, by and among the Company and the Initial Purchasers.
The opinions set forth below are being rendered pursuant to Section 9(e) of the
Purchase Agreement. Capitalized terms used herein and not defined herein have
the respective meanings ascribed to such terms in the Purchase Agreement.
In such capacity, we have participated in the preparation of an Offering
Memorandum, dated October 21, 1997 (the "Offering Memorandum"). In connection
with the opinions expressed below, we have examined originals or copies,
certified or otherwise identified to our satisfaction, of the following
(collectively, the "Transaction Documents"): (a) the Purchase Agreement, (b) the
Indenture, dated as of October 27, 1997, by and between the Company and The Bank
of New York, as Trustee (the "Indenture"), (c) the Registration Rights
Agreement, dated as of October 27, 1997, by and among the Company and the
Initial Purchasers (the IlRegistration Rights Agreement") and (d) the form of
the Notes.
In addition, we have examined originals or copies, certified or otherwise
identified to our satisfaction, of the certificate of incorporation and
by-laws of the Company and each of the Significant Subsidiaries and such other
instruments, documents and certificates of public officials and certificates of
officers of the Company as we have deemed relevant and necessary as a basis for
the opinions hereinafter set forth. In all such examinations we have assumed the
genuineness of all signatures on original or certified or otherwise identified
documents and the conformity to original or certified or otherwise identified
documents of all copies submitted to us as conformed or photostatic copies.
Our opinion is limited to the laws of the State of New York, the General
Corporation Law of the State of Delaware and Federal law.
Based upon the foregoing, and subject to the qualifications set forth herein, we
are of the opinion that:
(i) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of its jurisdiction of incorporation
and has the corporate power and authority to carry on its business as described
in the Offering Memorandum and to own, lease and operate its properties;
(ii) Each of the Company and its Significant Subsidiaries is duly
qualified and is in good standing as a foreign corporation authorized to do
business in each jurisdiction in which the nature of its business or its
ownership or leasing of property requires such qualification, except where the
failure to be so qualified would not have a Material Adverse Effect;
(iii) All the outstanding shares of capital stock of the Company have
been duly authorized and validly issued and are fully paid, non-assessable and
not subject to any preemptive or similar rights;
(iv) All of the outstanding shares of capital stock of each of the
Company's Significant Subsidiaries have been duly authorized and validly issued
and are fully paid and non-assessable, and are owned by the Company, free and
clear of any Lien;
<PAGE>
(v) The Purchase Agreement has been duly authorized, executed and delivered
by the Company;
(vi) The Indenture has been duly authorized, executed and delivered by
the Company and, assuming the due authorization, valid execution and delivery by
the Trustee, is a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms except as (x) the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
affecting creditors, rights generally, (y) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles of
general applicability and (z) to provisions relating to indemnities or
contribution, as to each of which we express no opinion;
(vii) The Notes have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture and delivered
to and paid for by the Initial Purchasers in accordance with the terms of the
Purchase Agreement and the Indenture, will be entitled to the benefits of the
Indenture and will be valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms except as (x) the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
affecting creditors, rights generally and (y) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles of
general applicability, as to each of' which we express no opinion;
(viii) The Registration Rights Agreement has been duly authorized,
executed and delivered by the Company and, assuming the due authorization, valid
execution and delivery by each of the Initial Purchasers, is a valid and binding
agreement of the Company, enforceable against the Company in accordance with its
terms except as (x) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally, (y) rights of
acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability and (z) to provisions relating to
indemnities or contribution, as to each of which we express no opinion;
<PAGE>
(ix) The shares of Common Stock initially issuable upon conversion of
the Notes in accordance with the Indenture have been duly authorized and
reserved for issuance upon such conversion and, when issued upon such
conversion, will be validly issued by the Company, fully paid and nonassessable;
and the stockholders of the Company have no preemptive rights under
the.Company's certificate of incorporation with respect to the Notes or the
shares of Common Stock issuable upon conversion of the Notes;
(x) The statements under the captions "Description of Credit Facility"
and Description of Notes" in the Offering Memorandum, insofar as such statements
constitute a summary of the legal matters, documents or proceedings referred to
therein, fairly present in all material respects such legal matters, documents
and proceedings;
(xi) The execution, delivery and performance of the Purchase
Agreement and the other Operative Documents by the Company, the compliance by
the Company with all provisions hereof and thereof and the consummation of the
transactions contemplated hereby and thereby will not (i) require any
consent, approval, authorization or other order of, or qualification with,
any court or governmental body or agency (except such as may be required under
the securities or Blue Sky laws of the various states and, with respect to the
Registration Statement, as required under the Act, the Exchange Act and the
TIA), (ii) conflict with or constitute a breach of any of the terms or
provisions of, or a default under, (a) the charter or by-laws of the Company or
any of its Significant Subsidiaries or (b) any indenture, loan agreement,
mortgage, lease or other agreement or instrument that is material to the Company
and its subsidiaries, taken as a whole, to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries or
their respective property is bound, (iii) violate or conflict with any
applicable law or any rule, regulation, judgment, order or decree of any court
or any governmental body or agency having jurisdiction over the Company, any of
its Significant Subsidiaries or their respective property, or (iv) result in the
imposition or creation of (or the obligation to create or impose) a Lien under,
any agreement or instrument to which the Company or any of its Significant
Subsidiaries is a party or by which
<PAGE>
the Company or any of its Significant Subsidiaries or their respective property
is bound, except, with respect to clauses (i), (ii)(b), (iii) and (iv), as would
not result in a Material Adverse Effect;
(xii) To the best of our knowledge, neither the Company nor any of its
Significant Subsidiaries is in violation of its respective charter or by-laws;
(xiii) We do not know of any legal or governmental proceedings pending
or threatened to which the Company or any of its Significant Subsidiaries is or
could be a party or to which any of their respective property is or could be
subject, which is reasonably likely to result, singly or in the aggregate, in a
Material Adverse Effect;
(xiv) The Company is not and, after giving effect to the offering and
sale of the Notes and the application of the net proceeds thereof as described
in the Offering Memorandum, will not be, an "investment company" as such term is
defined in the Investment Company Act of 1940, as amended;
(xv) To the best of our knowledge, except as disclosed in the Offering
Memorandum, there are no contracts, agreements or understandings between the
Company and any person granting such*person the right to require the Company to
file a registration statement under the Act with respect to any securities of
the Company or to require the Company to include such securities with the Notes
registered pursuant to any Registration Statement;
(xvi) The Indenture complies as to form in all material respects with
the requirements of the TIA, and the rules and regulations of the Commission
applicable to an indenture which is qualified thereunder except that the
Indenture will not be so qualified. It is not necessary in connection with the
offer, sale and delivery of the Notes to the Initial Purchasers in the manner
contemplated by the Purchase Agreement or in connection with the Exempt Resales
to qualify the Indenture under the TIA;
<PAGE>
(xvii) No registration under the Act of the Notes is required for the
sale of the Notes to the Initial Purchasers as contemplated by the Purchase
Agreement or for the Exempt Resales assuming that W each Initial Purchaser is a
QIB, an Accredited Institution or a Regulation S Purchaser, (ii) the accuracy
of, and the compliance with, the Initial Purchasers' representations and
agreements contained in Section 7 of the Purchase Agreement, (iii) the
compliance with, and accuracy of, the agreements and representations of the
Company set forth in Sections 5(h) and (m) and 6(ee), (ff), (gg), (hh), (ii),
(jj), (kk) and (11) of the Purchase Agreement and (iv) with respect to
Accredited Institutions, the accuracy of the representations made by each such
Accredited Institution as set forth in the letter of representation executed by
such Accredited Institution in the form of Annex A to the Offering Memorandum.
In addition, we have participated in conferences with officers and other
representatives of the Company, representatives of the independent certified
public accountants of the Company and the Initial Purchasers at which the
contents of the Offering Memorandum and any amendment thereof or supplement
thereto and related matters were discussed and, although we have not undertaken
to investigate or verify independently, and do not assume any responsibility
for, the accuracy, completeness or fairness of the statements contained in the
Offering Memorandum or any amendment thereof or supplement thereto, on the basis
of the foregoing (relying as to materiality to the extent we have deemed
appropriate upon the opinions of officers and other representatives of the
Company), no facts have come to our attentionthat would lead us to believe that
the Offering Memorandum as of its date or as of the date hereof, contained or
contains any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading (it being understood that in each such case we express no belief or
opinion with respect to the financial statements and schedules and other
financial or statistical data included therein).
In rendering the opinions set forth in this letter, we have relied as to matters
of fact on certificates of officers of the Company and of governmental
officials.
<PAGE>
The Bank of New York may rely on opinions in paragraphs (i), (ii), (vi), (vii),
(ix), (x), (xi) and (xvi) as if such opinions were addressed to them.
Notwithstanding the foregoing, this letter and the opinions expressed herein
are being furnished solely for your information and may not be relied upon by
any other person without our prior written consent.
Very truly yours,
/S/ Willkie Farr & Gallagher
FIRST AMENDMENT TO
FOURTH AMENDED AND RESTATED LOAN AGREEMENT
This FIRST AMENDMENT TO FOURTH AMENDED AND RESTATED LOAN AGREEMENT
(this "First Amendment") is made as of August 14, 1997, by and among (a) FINE
HOST CORPORATION, a Delaware corporation, for itself and as agent for all of the
Borrowers (as defined below)(hereinafter referred as "Fine Host" when acting for
itself and as the "Borrower Agent" when acting as agent for all of the Borrowers
(including Fine Host)), (b) all of the Subsidiaries of Fine Host (other than
Statewide (as defined below))(said Subsidiaries, together with Fine Host and any
and all other Subsidiaries which may hereafter become parties to the Loan
Agreement (as defined below) are hereinafter sometimes referred to collectively
as the "Borrowers" and each singly as a "Borrower"), (c) VARIOUS BANKS AND OTHER
FINANCIAL INSTITUTIONS which are parties to the Loan Agreement (hereinafter
referred to collectively as the "Banks" and each singly as a "Bank"), (d)
BANKBOSTON, N.A., a national banking association ("BankBoston"), as
administrative agent for the Banks (in such capacity, the "Administrative
Agent"), and (e) USTRUST, a Massachusetts trust company ("USTrust"), as
documentation agent for the Banks (in such capacity, the "Documentation
Agent")(the Administrative Agent and the Documentation Agent are hereinafter
sometimes referred to collectively as the "Agents").
All capitalized terms not defined herein but defined in that certain
Fourth Amended and Restated Loan Agreement, dated as of July 30, 1997 (the "Loan
Agreement"), by and among Fine Host, all of its Subsidiaries, the Banks, and the
Agents, shall have the meanings given to such terms in the Loan Agreement.
PRELIMINARY STATEMENTS
WHEREAS, Fine Host desires to enter into a certain Concessions
Management Agreement (the "Ravens Facility Agreement") with Baltimore Ravens
Limited Partnership, a Maryland limited partnership (together with its
successors and assigns, the "Ravens") contemporaneously herewith, pursuant to
which, the Ravens shall grant to Fine Host, for a term of twenty-five (25)
years, the exclusive right to provide certain food, beverage and merchandise
services, for and on behalf of the Ravens, at the Ravens' new stadium in
Baltimore, Maryland in exchange for, among other things, the following:
(a) An investment in Project Costs by Fine Host under the
Ravens Facility Agreement of up to Twenty Million and 00/100 Dollars
($20,000,000.00)(the "Ravens Investment"), to be advanced by Fine Host
to the Maryland Stadium Authority (together with its successors and
assigns, "MSA") over the term of the Ravens Facility Agreement; and
(b) One or more standby letters of credit to be issued for the
benefit of MSA, in the aggregate amount of up to Twenty Million and
00/100 Dollars ($20,000,000.00) to secure the full and prompt payment
by Fine Host to MSA of the Ravens Investment; and
WHEREAS, in connection with transactions contemplated by the Ravens
Facility Agreement, the Borrowers request that:
(a) Subject to the provisions of subsections 2.2.2 and 4.2 of
the Loan Agreement, the Banks make available to Fine Host one or more
Guidance Loans in the aggregate principal amount of up to Twenty
Million and 00/100 Dollars ($20,000,000.00), the proceeds of which will
be used by Fine Host to fund the Ravens Investment;
(b) The Banks consent to the Twenty Million and 00/100 Dollars
($20,000,000.00) of the Project Costs associated with the Ravens
Investment, which sum exceeds the limitation on Project Costs set forth
in subsection 7.5 of the Loan Agreement; and
(c) The Banks and the Agents amend the Loan Agreement in order
to increase the aggregate amount of the L/C Commitment from Ten Million
and 00/100 Dollars ($10,000,000.00) to Twenty-Five Million and 00/100
Dollars ($25,000,000.00) and provide certain other financial
accommodations to and for the benefit of the Borrowers, all as provided
for herein; and
WHEREAS, subject to the terms and conditions contained herein, the
Banks are willing to make such Guidance Loans available to Fine Host and to
consent to such Project Costs, and the Agents and the Banks are willing to so
amend the Loan Agreement, all in the manner provided for herein; and
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, and for other good and value consideration, the receipt and
sufficient of which are hereby acknowledged, the parties hereto agree as
follows:
1. Ravens Facility Agreement - Guidance Loans and Project Costs.
1.1 Subject to the provisions of subsections 2.2.2 and 4.2 of
the Loan Agreement, the Banks agree to make available to Fine Host one
or more Guidance Loans in the aggregate principal amount of up to
Twenty Million and 00/100 Dollars ($20,000,000.00), the proceeds of
which shall be used by Fine Host to fund the Project Costs associated
with the Ravens Investment pursuant to the Ravens Facility Agreement.
The Banks acknowledge that, with respect to these requested Guidance
Loans, the conditions precedent set forth in subsection 4.3 of the Loan
Agreement have been satisfied.
1.2 The Banks consent to the Project Costs associated with the
Ravens Investment so long as the total amount of such Project Costs
does not, at any time, exceed Twenty Million and 00/100 Dollars
($20,000,000.00) in the aggregate.
2. Amendments To Loan Agreement.
2.1 Amendment to Subsection 1.1. Subsection 1.1 of the Loan
Agreement is amended as follows:
(a) The words "Ten Million and 00/100 Dollars
($10,000,000.00)" contained in the definition of "L/C
Commitment" in subsection 1.1 of the Loan Agreement are
deleted, and replaced with the following words: "Twenty-Five
Million and 00/100 Dollars ($25,000,000.00)".
(b) The following definitions are inserted in
subsection 1.1 of the Loan Agreement in the appropriate
alphabetical order:
"'MSA' means the Maryland Stadium Authority,
together with its successors and assigns.
'Ravens' means Baltimore Ravens Limited
Partnership, a Maryland limited partnership, together
with its successors and assigns.
'Ravens Facility Agreement' means a certain
Concessions Management Agreement, dated as of August
14, 1997, by and between Fine Host and the Ravens, as
the same may be amended, modified, substituted,
extended or restated, from time to time.
'Ravens Investment' means an investment in
Project Costs by Fine Host of up to Twenty Million
and 00/100 Dollars ($20,000,000.00) under the Ravens
Facility Agreement.
'Ravens Standby Letters of Credit' means one
or more Standby Letters of Credit, issued by the
Issuing Bank, for the account of Fine Host, for the
benefit of MSA, in the aggregate amount of up to
Twenty Million and 00/100 Dollars ($20,000,000.00),
to secure the full and prompt payment by Fine Host of
the Ravens Investment."
2.2 Amendments to Subsections 2.1.3 and 2.1.11(b). The
following sentence is inserted at the end of each of subsections 2.1.3
and 2.1.11(b) of the Loan Agreement:
"Notwithstanding any provision contained in this subsection to
the contrary, any Ravens Standby Letters of Credit may be used
to secure and otherwise support the payment of Project Costs
associated with the Ravens Investment."
2.3 Amendments to Subsections 2.1.14(a), 2.1.15(a), 2.1.15(b)
and 2.1.15(c). The words "Subject to the provisions of subsection
2.1.15A," are inserted (i) at the beginning of the second sentence of
each of subsections 2.1.14(a) and 2.1.15(a) of the Loan Agreement, and
(ii) at the beginning of the first sentence of each of subsections
2.1.15(b) and 2.1.15(c) of the Loan Agreement.
2.4 New Subsection 2.1.15A. The following subsection 2.1.15A
is inserted between subsections 2.1.15 and 2.1.16 of the Loan
Agreement:
"2.1.15A Reimbursement of Drafts Presented Under Any
Ravens Standby Letter of Credit. Subject to the provisons of
subsection 4.2, and notwithstanding any other provision
contained in this Agreement to the contrary, the parties
hereto agree that:
(a) Any draft which is presented to the
Issuing Bank for payment under any Ravens Standby
Letter of Credit and for which the Issuing Bank is
not immediately reimbursed in full by the Borrowers
shall automatically constitute a request by the
Borrower Agent to the Administrative Agent under
subsection 2.2 (but without any requirement for
compliance with the prior notice provisions or
minimum amount provisions of subsection 2.2.2) for a
Guidance Loan, in the amount of such draft, or any
part thereof, which is not so reimbursed. The
Administrative Agent shall promptly notify the Banks
of such request. The Borrowing Date with respect to
such requested Guidance Loan shall be the date on
which such draft is presented to the Issuing Bank for
payment. Each Bank shall make available to the
Administrative Agent on such Borrowing Date its
Guidance Loan Commitment Percentage of such requested
Guidance Loan to be used by the Administrative Agent
to fund such requested Guidance Loan. All of the
proceeds from such requested Guidance Loan shall be
advanced by the Administrative Agent directly to the
Issuing Bank to be used solely to pay in full the
amount of the draft, or any part thereof, of such
Ravens Standby Letter of Credit for which the Issuing
Bank was not so reimbursed, whereupon all of the
Reimbursement Obligations of the Borrowers with
respect to such draft shall be deemed to be
satisfied.
(b) Unless the Administrative Agent is
otherwise notified in accordance with the provisions
of subsections 2.2.1(b) and 2.2.2, each Guidance Loan
requested pursuant to this subsection 2.1.15A shall
be an ABR Loan."
3. Loan Availability. Each Ravens Standby Letter of Credit, when
issued, will reduce, in accordance with the provisions of subsection 2.1.5 of
the Loan Agreement, as amended hereby, the amount of the Working Capital
Commitment by the amount outstanding under such Ravens Standby Letter of Credit,
and the amount of the L/C Commitment then remaining available for issuance will
be reduced by the amount outstanding under such Ravens Standby Letter of Credit.
Any Guidance Loan requested under subsection 2.1.15A of the Loan Agreement, as
amended hereby, will on the Borrowing Date with respect to such requested
Guidance Loan immediately reduce (subject to the second sentence of subsection
2.2.1(a) of the Loan Agreement) the Guidance Loan Commitments, and the Working
Capital Commitment and the L/C Commitment will thereupon be restored, by the
amount of such requested Guidance Loan.
4. Statewide. The Borrowers represent and warrant that, since the
Closing Date, Fine Host has acquired all of the issued and outstanding shares of
capital stock of Statewide Industrial Catering, Inc., a New York corporation
("Statewide"). The Borrowers will cause Statewide to comply timely and fully
with the requirements of subsection 6.12(b) of the Loan Agreement. The Borrowers
hereby further represent and warrant that if, effective as of the date hereof,
Statewide were to become a party to the Loan Agreement and all of the other Loan
Documents to which the Borrowers are parties, there would be no breach by
Statewide of any of its representations and warranties contained therein which
would have a Material Adverse Effect, and there would be no events,
circumstances or conditions (financial or otherwise) relating to Statewide which
would materially and adversely impair the ability of Statewide to perform or
observe all of its obligations thereunder in accordance with the terms thereof.
5. Compliance with Subsection 4.2. Each of the Borrowers represents and
warrants that, except as otherwise described in Section 4 above, all of the
conditions contained in subsection 4.2 of the Loan Agreement have been satisfied
as of the date hereof.
6. Ratification of Loan Documents. Subject to the amendments expressly
set forth in this First Amendment, each of the Borrowers hereby ratifies and
reaffirms all of the terms and provisions of the Loan Documents to which it is a
party or by which it or its property is bound, and hereby expressly acknowledges
and confirms that the terms and provisions of each thereof, as amended hereby,
shall and do remain in full force and effect.
7. Conditions Precedent. The obligations of the Banks and the Agents
hereunder are subject to the satisfaction of each of the following conditions
precedent, all of which shall be in form, scope and substance satisfactory to
the Administrative Agent and its counsel:
(a) First Amendment. The Administrative Agent shall have
received this First Amendment, as executed by a duly authorized officer
or agent of each Borrower.
(b) Authorization. All corporate or other action necessary for
the valid execution, delivery and performance by the Borrowers of this
First Amendment shall have been duly and effectively taken, and
evidence thereof satisfactory to the Administrative Agent shall have
been provided to the Administrative Agent.
(c) Opinion Letters. The Administrative Agent shall have
received opinion letters from Willkie Farr & Gallagher, counsel to the
Borrowers, and Ellen Keats, General Counsel for the Borrowers; and
(d) Other. The Borrowers shall have delivered to the
Administrative Agent such other documents as the Administrative Agent
or its counsel may reasonably require.
8. Miscellaneous.
8.1 No Other Amendments; No Waiver. Except for the amendments
expressly set forth in the First Amendment, nothing contained herein
shall be construed to modify, amend or otherwise alter any of the terms
or provisions of any of the Loan Documents; nothing contained herein
shall constitute a waiver of or bar to any rights or remedies available
to any of the Agents or the Banks, or a waiver of any Event of Default
under the Loan Documents on any occasion, other than as expressly set
forth herein; and nothing contained herein shall constitute an
agreement by any of Agents or the Banks or obligate any of the Agents
or the Banks to take or refrain from taking any action.
8.2 Execution; Counterparts. This First Amendment may be
executed in any number of counterparts, each of which shall be deemed
to be an original as against any party whose signature appears hereon,
and all of which shall together constitute one and the same instrument.
This First Amendment shall become binding when one or more counterparts
hereof, individually or taken together, shall bear the signatures of
all of the parties reflected hereon as the signatories.
8.3 Successors and Assigns. This First Amendment shall be
binding upon and inure to the benefit of the parties hereto, and their
respective representatives, successors and assigns.
8.4 Joint and Several Liability. All of the obligations and
liabilities of the Borrowers hereunder and under all of the other Loan
Documents are joint and several.
8.5 Governing Law. This First Amendment and all questions
relating to its validity, interpretation, performance and enforcement
shall be governed by and construed in accordance with the laws of The
Commonwealth of Massachusetts, notwithstanding any conflict-of-law
provisions to the contrary.
<PAGE>
IN WITNESS WHEREOF, this First Amendment has been duly executed as an
instrument under seal by the duly authorized representative of each party
hereto, as of the day and year first above written.
BANKBOSTON, N.A. AS USTRUST AS
ADMINISTRATIVE AGENT DOCUMENTATION AGENT
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
BANKBOSTON, N.A. AS LENDER USTRUST AS LENDER
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
STATE STREET BANK AND TRUST THE SUMITOMO BANK, LIMITED
COMPANY
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
By:______________________________
Title:_____________________________
MELLON BANK, N.A. THE BANK OF NEW YORK
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
KEYBANK, N.A. FIRST UNION BANK OF
CONNECTICUT
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
BANK OF SCOTLAND THE BANK OF NOVA SCOTIA
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
NATIONAL WESTMINSTER BANK LEUMI TRUST COMPANY
BANK P.L.C. OF NEW YORK
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST CORPORATION FINE HOST SERVICES CORPORATION
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST OF VERMONT, INC. FANFARE, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
GLOBAL FANFARE, INC. FINE HOST INTERNATIONAL
CORPORATION
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
CREATIVE FOOD MANAGEMENT NORTHWEST FOOD SERVICE, INC.
INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
TARRANT COUNTY SUN WEST SERVICES, INC.
CONCESSIONS, L.L.C.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
REPUBLIC MANAGEMENT CORP. VERSATILE HOLDING CORPORATION
OF MASSACHUSETTS
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
SERV-RITE CORPORATION IDEAL MANAGEMENT SERVICES, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
SERVICE DYNAMICS CORP. PCS HOLDING CORP. (f/k/a HCS
Management Corp.)
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
PCS MANAGEMENT CORP. HEARTSTRINGS GIFT SHOPS, INC.
(f/k/a N.C. PCSM, Inc.) (f/k/a Hospital Coffee Shoppes, Inc.)
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
THE ENVIRONMENTAL GROUP, CREATIVE DATA SYSTEMS, INC.
INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST/R&N/A CUP ABOVE JOINT
VENTURE, a joint venture
By: Fine Host Corporation, in its capacity as a
joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
By: ____________________________________
Tyrone W. Nabbie (together with Ronald O.
Rogers, doing business as R&N Management
Services), in his capacity as a joint venturer
of aforesaid joint venture
By: ____________________________________
Ronald O. Rogers (together with Tyrone W.
Nabbie, doing business as R&N Management
Services), in his capacity as a joint venturer
of aforesaid joint venture
By: ____________________________________
Ellen Korbin (doing business as A Cup
Above), in her capacity as a joint venturer
of aforesaid joint venture
FINE HOST/S. BROOKS &
ASSOCIATES JOINT VENTURE, a joint venture
By: Fine Host Corporation, in its capacity as a
joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
By: S. Brooks & Associates, Inc., in its capacity
as a joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
WISCONSIN CENTER JOINT VENTURE,
a joint venture
By: Fine Host Corporation, in its capacity as a
joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
By: Five-Star Marketing, Inc., in its capacity
as a joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
SECOND AMENDMENT TO
FOURTH AMENDED AND RESTATED LOAN AGREEMENT
This SECOND AMENDMENT TO FOURTH AMENDED AND RESTATED LOAN AGREEMENT
(this "Second Amendment") is executed and effective (subject to the condition
set forth in Section 7.6 below) on October 21, 1997, by and among (a) FINE HOST
CORPORATION, a Delaware corporation, for itself and as agent for all of the
Borrowers (as defined below)(hereinafter referred to as "Fine Host" when acting
for itself and as the "Borrower Agent" when acting as agent for all of the
Borrowers (including Fine Host)), (b) all of the Subsidiaries of Fine Host
(other than the New Subsidiaries (as defined below))(said Subsidiaries, together
with Fine Host and any and all other Subsidiaries which may hereafter become
parties to the Loan Agreement (as defined below) are hereinafter sometimes
referred to collectively as the "Borrowers" and each singly as a "Borrower"),
(c) VARIOUS BANKS AND OTHER FINANCIAL INSTITUTIONS which are parties to the Loan
Agreement (hereinafter referred to collectively as the "Banks" and each singly
as a "Bank"), (d) BANKBOSTON, N.A., a national banking association
("BankBoston"), as administrative agent for the Banks (in such capacity, the
"Administrative Agent"), and (e) USTRUST, a Massachusetts trust company
("USTrust"), as documentation agent for the Banks (in such capacity, the
"Documentation Agent")(the Administrative Agent and the Documentation Agent are
hereinafter sometimes referred to collectively as the "Agents").
All capitalized terms not defined herein but defined in that certain
Fourth Amended and Restated Loan Agreement, dated as of July 30, 1997, by and
among Fine Host, all of the Subsidiaries, the Banks, and the Agents, as amended
by a certain First Amendment to Loan Agreement, dated as of August 14, 1997, by
and among Fine Host, all of the Subsidiaries, the Banks, and the Agents (said
Fourth Amended and Restated Loan Agreement, as so amended, is hereinafter
referred to as the "Loan Agreement") shall have the meanings given to such terms
in the Loan Agreement.
PRELIMINARY STATEMENTS
WHEREAS, Fine Host intends to offer and sell certain Subordinated
Convertible Notes due 2004, in the aggregate principal amount of up to Two
Hundred Million and 00/100 Dollars ($200,000,000.00)(the "Subordinated
Convertible Notes"), and to use a portion of the Net Proceeds therefrom to pay,
on the Offering Completion Date, all of the outstanding Liabilities, all as more
particularly described below; and
WHEREAS, the Borrowers request that the Banks and the Agents amend the
Loan Agreement to permit Fine Host to issue the Subordinated Convertible Notes;
and
WHEREAS, subject to the terms and conditions contained herein, the
Banks and the Agents are willing to so amend the Loan Agreement;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficient of which are hereby acknowledged, the parties hereto agree as
follows:
1. Amendments To Loan Agreement.
1.1 Amendment to Subsection 1.1. The following definitions are
inserted in subsection 1.1 of the Loan Agreement in the
appropriate alphabetical order:
"'Consolidated Senior Debt' means at any date of
determination, the sum of all of the outstanding Liabilities
plus any other outstanding Indebtedness that is Senior
Indebtedness (as such term is defined in the Indenture), all
as determined as of such date on a consolidated basis in
accordance with GAAP.
'Subordinated Convertible Notes' means certain
Subordinated Convertible Notes due 2004, of Fine Host, in the
aggregate principal amount of not more than Two Hundred
Million and 00/100 Dollars ($200,000,000.00)."
'Indenture' means that certain Indenture to be
entered into between Fine Host and The Bank of New York as
trustee, providing for the issuance of the Subordinated
Convertible Notes on substantially the terms set forth under
the caption "Description of Notes" contained in the
Preliminary Offering Memorandum, dated October 10, 1997 of
Fine Host relating thereto, a copy of which Preliminary
Offering Memorandum (the 'Offering Memorandum') has been
delivered to each of the Banks and the Administrative Agent,
as such Indenture may be amended, modified, supplemented,
extended or restated, from time to time, in accordance with
the provisions of subsection 7.14."
1.2 Amendment to Subsection 4.3(b). The following sentence is
inserted at the end of clause (b) of subsection 4.3 of the
Loan Agreement:
"As used herein, the term "combined companies" means (i) all
of the Borrowers (including without limitation, any Subsidiary
which pursuant to the provisions of Subsection 6.12(b) below,
is required to become a Subsidiary Borrower) and (ii) the
acquired business or target company, whichever is applicable."
1.3 Amendment to Subsection 7.1. Subsection 7.1 of the Loan
Agreement is hereby amended as follows:
(a) Subsection 7.1(a) of the Loan Agreement is hereby amended
and restated as follows:
"(a) Ratio of Consolidated Debt to Adjusted
Consolidated EBITDA. Permit for any period of four
consecutive fiscal quarters (to be tested as of the
last day of each fiscal quarter, commencing with the
fiscal quarter ending December 31, 1997) the ratio of
their Consolidated Debt for such period to their
Adjusted Consolidated EBITDA for such period to be
more than:
(i) 5.0 to 1.00 as of the last day
of the fiscal quarters ending December 31,
1997 and April 1, 1998 (provided, however,
that the failure of the Borrowers to comply
with such ratio during such period shall not
constitute an Event of Default hereunder so
long as during each such period, (x) there
are no Guidance Loans outstanding, and (y)
such ratio is not more than 5.4 to 1.00);
(ii) 4.5 to 1.00 as of the last day
of each of the fiscal quarters ending July
1, 1998 and September 30, 1998; and
(iii) 4.0 to 1.00 as of the last day
of the fiscal quarter ending December 30,
1998 and at the end of each fiscal quarter
thereafter."
(b) The following new Subsection 7.1(e) and the following new
paragraph are inserted at the end of subsection 7.1 of the
Loan Agreement:
"(e) Ratio of Consolidated Senior Debt to
Adjusted Consolidated EBITDA. Permit for any period
of four consecutive fiscal quarters (to be tested as
of the last day of each fiscal quarter, commencing
with the fiscal quarter ending December 31, 1997) the
ratio of their Consolidated Senior Debt for such
period to their Adjusted Consolidated EBITDA for such
period to be more than:
(i) 2.75 to 1.00 as of the last day
of each of the fiscal quarters ending
December 31, 1997 and April 1, 1998;
(ii) 2.50 to 1.00 as of the last day
of each of the fiscal quarters ending July
1, 1998 and September 30, 1998; and
(iii) 2.25 to 1.00 as of the last
day of the fiscal quarter ending December
30, 1998 and at the end of each fiscal
quarter thereafter.
All financial ratios and covenants in this subsection
7.1 which are tested as of the last day or at the end of any
fiscal quarter shall be applicable at all times during the
relevant period."
1.4 Amendment to Subsection 7.3. Subsection 7.3 of the Loan
Agreement is hereby amended as follows:
(a) The word "and" at the end of clause (h) of
subsection 7.3 of the Loan Agreement is deleted.
(b) The period at the end of clause (i) of subsection
7.3 of the Loan Agreement is deleted, and replaced with the
following:
"; and (j) the Indebtedness of Fine Host under the
Subordinated Convertible Notes."
1.5 Amendment to Subsection 7.14. Subsection 7.14 of
the Loan Agreement is hereby amended as follows:
(a) The words "(including but not limited to
Subordinated Debt)" contained in subsection 7.14 of the Loan
Agreement are replaced with the following words:
"(including without limitation, (a) any of the
Indebtedness evidenced by the Subordinated
Convertible Notes, and (b) all of the Subordinated
Debt)".
(b) The following sentences are inserted at the end
of subsection 7.14 of the Loan Agreement:
"The foregoing provisions shall not apply to the
conversion of Subordinated Convertible Notes, in
accordance with their terms. Fine Host shall not
amend, modify or change, or consent or agree to any
amendment, modification or change to, any of the
terms of the Subordinated Convertible Notes or the
Indenture (other than any such amendment,
modification, change, consent or agreement which (i)
would extend the maturity or reduce the amount of any
payment of principal thereof or would reduce the rate
or extend the date for payment of interest thereon or
(ii) does not adversely affect the interests of the
Agents or the Banks hereunder or under the other Loan
Documents)."
1.6 New Subsection 7.14A. The following new
subsection 7.14A is hereby inserted between subsections 7.14
and 7.15 of the Loan Agreement:
"7.14A. No Violation of Subordination Provisions by
Subsidiary Borrowers. No Subsidiary Borrower will directly or
indirectly make any payment, or do any act with respect to any
of the Subordinated Convertible Notes or the Subordinated
Debt, which payment or act if made or done by Fine Host would
violate or conflict with any of the subordination provisions
contained in any of the agreements, notes, indentures
(including the Indenture), documents, instruments and other
writings that evidence or otherwise relate to the Subordinated
Convertible Notes or the Subordinated Debt."
1.7 Amendment to Subsection 8.1. Subsection 8.1 of
the Loan Agreement is hereby amended as follows:
(a) The word "or" at the end of clause (o) of
subsection 8.1 of the Loan Agreement is hereby deleted.
(b) The period at the end of clause (p) of subsection
8.1 of the Loan Agreement is replaced with a semicolon, and
the following new clauses are inserted immediately thereafter:
"(q) Any default shall exist and remains
unwaived or uncured with respect to any of the
Subordinated Convertible Notes if, as a result of
such default, any holder of such a Subordinated
Convertible Note, or the trustee under the Indenture,
is entitled to cause any such Subordinated
Convertible Note to become due prior to its stated
date of maturity, or any of the Subordinated
Convertible Notes shall not have been paid when due,
whether by acceleration or otherwise, or shall have
been declared to be due and payable prior to their
stated maturity; or
(r) The subordination provisions contained
in the Indenture cease to be enforceable in
accordance with their terms."
2. Use of Proceeds. The Net Proceeds from the Subordinated Convertible
Notes shall be used by Fine Host as follows: (a) first, to prepay in full, on
the Offering Completion Date, the entire outstanding balances of all of the
Loans, all in accordance with the provisions of subsection 3.1 of the Loan
Agreement, (b) second, to pay in full, on the Offering Completion Date, any and
all other outstanding Liabilities (other than Liabilities in respect of
outstanding Letters of Credit that have not been drawn), and (c) thereafter, for
working capital, acquisitions and general corporate purposes of Fine Host.
3. New Acquisitions. The Borrowers represent and warrant that, since
the Closing Date, Fine Host has acquired all of the issued and outstanding
shares of capital stock of the following corporations (collectively, "New
Subsidiaries"): (a) Statewide Industrial Catering, Inc., a New York corporation,
(b) Best, Inc., a Minnesota corporation, (c) Total Food Service Direction, Inc.,
a Florida corporation, and (d) Global Food Services, Inc., a Florida
corporation. The Borrowers will cause each of the New Subsidiaries to comply
timely and fully with the requirements of subsection 6.12(b) of the Loan
Agreement. The Borrowers hereby further represent and warrant that if, effective
as of the date hereof, each of the New Subsidiaries were to become a party to
the Loan Agreement and all of the other Loan Documents to which the Borrowers
are parties, there would be no breach by any of the New Subsidiaries of any of
its representations and warranties contained therein which would have a Material
Adverse Effect, and there would be no events, circumstances or conditions
(financial or otherwise) relating to any of the New Subsidiaries which would
materially and adversely impair the ability of each of the New Subsidiaries to
perform or observe all of its obligations thereunder in accordance with the
terms thereof.
4. Compliance with Subsection 4.2. Each of the Borrowers represents and
warrants that, except as otherwise described in Section 3 above, all of the
conditions contained in subsection 4.2 of the Loan Agreement would be satisfied
as of the date hereof, if an Extension of Credit were being made on the date
hereof.
5. Ratification of Loan Documents. Subject to the amendments expressly
set forth in this Second Amendment, each of the Borrowers hereby ratifies and
reaffirms all of the terms and provisions of the Loan Documents to which it is a
party or by which it or its property is bound, and hereby expressly acknowledges
and confirms that the terms and provisions of each thereof, as amended hereby,
shall and do remain in full force and effect. Without limiting the generality of
the foregoing, each of the Borrowers hereby acknowledges and agrees that each of
the Notes has, at all times, been and continues to remain in full force and
effect, notwithstanding that a portion of the Net Proceeds from the Subordinated
Convertible Notes will be used by Fine Host to pay the outstanding Liabilities,
as provided herein.
6. Conditions Precedent. The effectiveness of this Second Amendment is
subject to the satisfaction on the date hereof of each of the following
conditions precedent, all of which shall be in form, scope and substance
satisfactory to the Administrative Agent and its counsel:
(a) Second Amendment. The Administrative Agent shall have
received this Second Amendment, as executed by a duly authorized
officer or agent of each Borrower and the Required Banks;
(b) Authorization. All corporate or other action necessary for
the valid execution, delivery and performance by the Borrowers of this
Second Amendment shall have been duly and effectively taken, and
evidence thereof satisfactory to the Administrative Agent shall have
been provided to the Administrative Agent;
(c) Offering Memorandum. The Administrative Agent shall have
received a true, correct and complete copy of the Offering Memorandum
of Fine Host for the issuance of the Subordinated Convertible Notes;
and
(d) Opinion Letters. The Administrative Agent shall have
received opinion letters from Willkie Farr & Gallagher, special counsel
for the Borrowers, and Ellen Keats, General Counsel for the Borrowers.
7. Miscellaneous.
7.1 No Other Amendments; No Waiver. Except for the amendments
expressly set forth in this Second Amendment, nothing contained herein
shall be construed to modify, amend or otherwise alter any of the terms
or provisions of any of the Loan Documents; nothing contained herein
shall constitute a waiver of or bar to any rights or remedies available
to any of the Agents or the Banks, or a waiver of any Event of Default
on any occasion, other than as expressly set forth herein; and nothing
contained herein shall constitute an agreement by any of the Agents or
the Banks or obligate any of the Agents or the Banks to take or refrain
from taking any action.
7.2 Execution; Counterparts. This Second Amendment may be
executed in any number of counterparts, each of which shall be deemed
to be an original as against any party whose signature appears hereon,
and all of which shall together constitute one and the same instrument.
This Second Amendment shall become binding when one or more
counterparts hereof, individually or taken together, shall bear the
signatures of the Borrowers and the Required Banks.
7.3 Successors and Assigns. This Second Amendment shall be
binding upon and inure to the benefit of the parties hereto, and their
respective representatives, successors and assigns.
7.4 Joint and Several Liability. All of the obligations and
liabilities of the Borrowers under this Second Amendment and under all
of the other Loan Documents are joint and several.
7.5 Governing Law. This Second Amendment and all questions
relating to its validity, interpretation, performance and enforcement
shall be governed by and construed in accordance with the laws of The
Commonwealth of Massachusetts, notwithstanding any conflict-of-law
provisions to the contrary.
7.6 Offering Completion Date. The date on which Fine Host has
completed the initial issuance of the Subordinated Convertible Notes is
herein referred to as the "Offering Completion Date". Notwithstanding
any of the other provisions contained in this Second Amendment to the
contrary, this Second Amendment shall automatically terminate and be
null and void, and shall have no further force or effect, if the
Offering Completion Date does not occur on or prior to November 30,
1997.
IN WITNESS WHEREOF, this Second Amendment has been duly executed as an
instrument under seal by the duly authorized representative of each party
hereto, as of the day and year first above written.
BANKBOSTON, N.A. AS USTRUST AS
ADMINISTRATIVE AGENT DOCUMENTATION AGENT
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
BANKBOSTON, N.A. AS LENDER USTRUST AS LENDER
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
STATE STREET BANK AND TRUST THE SUMITOMO BANK, LIMITED
COMPANY
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
By:______________________________
Title:_____________________________
MELLON BANK, N.A. THE BANK OF NEW YORK
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
KEYBANK, N.A. FIRST UNION BANK OF CONNECTICUT
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
BANK OF SCOTLAND THE BANK OF NOVA SCOTIA
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
GLEACHER NATWEST BANK LEUMI TRUST COMPANY
OF NEW YORK
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST CORPORATION FINE HOST SERVICES CORPORATION
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
FINE HOST OF VERMONT, INC. FANFARE, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
GLOBAL FANFARE, INC. FINE HOST INTERNATIONAL
CORPORATION
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
CREATIVE FOOD MANAGEMENT NORTHWEST FOOD SERVICE, INC.
INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
TARRANT COUNTY SUN WEST SERVICES, INC.
CONCESSIONS, L.L.C.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
REPUBLIC MANAGEMENT CORP. VERSATILE HOLDING CORPORATION
OF MASSACHUSETTS
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
SERV-RITE CORPORATION IDEAL MANAGEMENT SERVICES, INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
SERVICE DYNAMICS CORP. PCS HOLDING CORP. (f/k/a HCS
Management Corp.)
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
PCS MANAGEMENT CORP. HEARTSTRINGS GIFT SHOPS, INC.
(f/k/a N.C. PCSM, Inc.) (f/k/a Hospital Coffee Shoppes, Inc.)
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
THE ENVIRONMENTAL GROUP, CREATIVE DATA SYSTEMS, INC.
INC.
By:______________________________ By:______________________________
Title:_____________________________ Title:_____________________________
10
FINE HOST/R&N/A CUP ABOVE JOINT
VENTURE, a joint venture
By: Fine Host Corporation, in its capacity as a
joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
FINE HOST/S. BROOKS &
ASSOCIATES JOINT VENTURE, a joint venture
By: Fine Host Corporation, in its capacity as a
joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
WISCONSIN CENTER JOINT VENTURE,
a joint venture
By: Fine Host Corporation, in its capacity as a
joint venturer of aforesaid joint venture
By:______________________________
Title:_____________________________
<PAGE>
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement"), is' entered into
as of August 27, 1997, by and between Perry M. Rynders, a natural person
currently residing in the State of Minnesota (the "Employee") and Best, Inc., a
Minnesota corporation ("Best") .
W I T N E S S E T H
WHEREAS, the Employee, Fine Host Corporation ("Fine Host") and
certain other parties have entered into that certain Stock Purchase Agreement,
dated as of August 27, 1997 (the "Purchase Agreement"), pursuant to which Fine
Host has agreed to purchase all of the issued and outstanding capital stock of
Best;
WHEREAS, in order to protect the value of the business
acquired under the Purchase Agreement and to secure for itself the benefit of
the Employee's background, experience, ability and expertise, Best and the
Employee desire to enter into the employment arrangements provided for herein in
consideration of the amounts payable to the Employee pursuant hereto;
WHEREAS, it is a condition to the closing under the Purchase
Agreement that the Employee and Best enter into this Agreement; and
WHEREAS, Best desires to employ the Employee and the Employee
has indicated his willingness to provide his services, on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises,
and of the mutual covenants and agreements set forth herein, the sufficiency of
which is hereby acknowledged by each of the parties hereto, the parties hereby
agree as follows:
A G R E E M E N T:
1. Employment. Best hereby agrees to employ the Employee and
the Employee hereby accepts employment with Best, on the terms and subject to
the conditions hereinafter set forth. Subject to the terms and conditions
contained herein, the Employee shall (i) provide administrative and operating
oversight with respect to the retention of customer accounts existing as of the
date hereof; (ii) assist Fine Host and Best and its authorized representatives
with respect to marketing and sales efforts in connection with obtaining new
customer accounts; (iii) be responsible for the day-to-day operations of Best's
healthcare and corrections divisions; and (iv) perform such other services and
tasks related to the foregoing as may be reasonably requested by the Board of
Directors of Fine Host and Best from time to time (the "Services"), and Best
hereby engages the Employee to provide and perform the same. The Employee shall
have the title of Group President - Healthcare and Corrections and shall report
directly to the President and Chief Operating Officer of Fine Host. The
principal location of the Employee's employment shall be in Minneapolis/St.
Paul, Minnesota, although the Employee understands and agrees that he may be
required to travel from time to time for business reasons.
2. Term of Agreement. The term of this Agreement
shall commence on the date of this Agreement and terminate on
August _____, 2000 (the "Initial Term"), unless terminated at an
earlier date pursuant to Section 6 hereof; provided, however, that commencing on
the expiration date of the term of this Agreement, the term of this Agreement
shall be automatically extended for an additional one year period on the terms
set forth in this Agreement unless, not later than ninety (90) days preceding
the expiration date of the term of this Agreement, either party hereto shall
have given written notice to the other that it does not wish to extend the term
of this Agreement. The Initial Term, together with the extension pursuant to
this Section 2, is referred to herein as the "Employee Term".
3. Compensation. (a) As compensation for the performance of the Services
Best shall pay the Employee a salary (the "Salary") of one Hundred Sixty
Thousand Dollars ($160,000) per annum, to be reviewed on an annual basis,
payable in accordance with the payroll practices of Best as the same shall exist
from time to time. Employee shall also be eligible to receive additional
compensation (the "Bonus") in an amount and on terms commensurate with other
Fine Host Group Presidents.
(b) The Employee shall be entitled to participate in such
health, medical, retirement and fringe benefit programs as are generally
available to executives of Best from time to time. In addition, after the
expiration of the term, Employee shall be entitled to participate in such health
and medical programs during the Restricted Period (as hereinafter defined).
(c) The Employee shall be eligible to participate in Fine
Host's Stock Option Plan in accordance with the terms of such plan.
(d) In addition to his Salary, Bonus, if any, and benefits,
the Employee shall be entitled to a monthly car allowance of Eight Hundred Fifty
Dollars ($850) during the Employee Term in accordance with the policy of Best
existing as of the date hereof.
(e) In addition to his Salary, Bonus, if any, and benefits,
Best shall pay the outstanding amount due on Employee's country club initiation
fees, and shall also pay any dues for such country club, which amount shall not
exceed $300 per month, during the Employee Term.
4. Exclusivity. During the Employee Term, the Employee shall
devote his full time to the business of Best, shall faithfully serve Best, shall
in all respects conform to and comply with the lawful and reasonable directions
and instructions given to him by the Board of Directors of Fine Host or Best in
accordance with the terms of this Agreement and shall use his best efforts to
promote and serve the interests of Fine Host and Best.
5. Expenses. While this Agreement is in effect and the
Employee is properly performing the Services in accordance with the terms and
conditions of this Agreement, Best agrees to pay or reimburse the Employee for
all reasonable and proper out-of-pocket business expenses incurred or paid by
the Employee on behalf of Best in furtherance of the Services in accordance with
Best's expense reimbursement policy, as the same may be modified from time to
time; provided, however, that any expense which individually is in excess of
$1,000 must be approved by Fine Host's President and Chief operating Officer in
writing prior to being incurred by the Employee. Any expenses which Best shall
be expected to pay or to reimburse the Employee for shall be paid only upon
receipt by Best of timely and accurate itemized receipts and statements for all
expenses incurred by the Employee in accordance with the financial policy of
Best, as in effect from time to time.
6. Termination and Default.
(a) Death. This Agreement shall automatically
terminate upon the death of the Employee and upon such event, the Employee's
estate shall be entitled to receive the amounts specified in Section 6(d) below.
(b) Disability. If the Employee is unable to perform
the duties required of him under this Agreement because of illness, incapacity,
or physical or mental disability, this Agreement shall remain in full force and
effect and Best shall pay all compensation required to be paid to the Employee
hereunder, unless the Employee is unable to perform the duties required of him
under this Agreement for an aggregate of 120 days (whether or not consecutive)
during any 12-month period during the term of this Agreement, in which event
this Agreement (other than Sections 6(d), 7, 8, 9, 10 and 14 hereof), including,
but not limited to, Best's obligations to pay any Salary or to provide any
privilege under this Agreement, shall terminate.
(c) Just Cause. Best may terminate this Agreement (other
than Sections 6(d), 7, 8, 9, 10 and 14 hereof) for "Just Cause." For purposes of
this Agreement, "Just Cause,, shall mean: (i) the Employee's failure, neglect-or
refusal to perform his duties hereunder which failure, neglect or refusal shall
not have been corrected by the Employee within 30 days of receipt by the
Employee of written notice from Best of such failure, neglect or refusal, which
notice shall specifically set forth the nature of said failure, neglect or
refusal; (ii) any willful or intentional act of the Employee that has the effect
of injuring the reputation or business of Best or its affiliates in any material
respect; (iii) use of illegal drugs by the Employee or repeated drunkenness;
(iv) conviction of the Employee for the commission of a felony; or (v) the
commission by the Employee of an act of fraud or embezzlement against Best. If
the Employee's employment hereunder is terminated for Just Cause, the Employee
shall be entitled to receive the amounts specified in Section 6(d) below. In the
event of termination pursuant to this Section 6(c), Best shall deliver to the
Employee written notice setting forth the basis for such termination, which
notice shall specifically set forth the nature of the Just Cause which is the
reason for such termination. Termination of the Employee's employment hereunder
shall be effective upon delivery of such notice of termination.
(d) Payments. In the event that the Employee's employment
hereunder terminates for any reason, Best shall pay to the Employee all amounts
accrued but unpaid hereunder through the date of termination in respect of wages
or unreimbursed expenses. Amounts owed by Best in respect of the consideration
or reimbursement for expenses under the provisions of Sections 3 and 5 hereof
shall, except as otherwise set forth in this Section 6(d), be paid promptly upon
any termination. Upon any termination of this Agreement, all of the rights,
privileges and duties of the Employee hereunder shall cease, except for his
rights under this Section 6(d) and his obligations under Sections 7, 8, 9, 10
and 14 hereunder.
7. Secrecy and Non-Competition.
(a) Non-Competition. The Employee acknowledges that the
agreements and covenants contained in this Section 7 are essential to protect
the value of Best's business and assets and by virtue of his current and future
relationship with Best, the Employee has obtained and will obtain such
knowledge, contacts, know-how, training and experience and there is a
substantial probability that such knowledge, know-how, contacts, training and
experience could be used to the substantial advantage of a competitor of Best
and to Best's substantial detriment. The Employee also acknowledges that Fine
Host has purchased all of the outstanding Shares of Best in reliance on the
covenants made by the Employee in this Section 7, and that Fine Host would not
have acquired the Shares of Best from the Employee in the absence of the
covenants made by the Employee in this Section 7. Therefore, the Employee agrees
that for the period commencing on the date of this Agreement and ending on the
fourth anniversary of the termination of the Employee Term (such period is
hereinafter referred to as the "Restricted Period") with respect to the one
hundred mile radius around any city in which, or any location at which, Fine
Host, Best or any of their subsidiaries or affiliates is actively providing
services or otherwise doing business on the date of the termination of the
Employee Term hereunder, the Employee shall not participate or engage, directly
or indirectly, for himself or on behalf of or in conjunction with any person,
partnership, corporation or other entity, whether as an employee, agent,
officer, director, shareholder, partner, joint venturer, investor or otherwise,
in any food service management business if such activity consists of any
activity undertaken by Fine Host, Best or any of their subsidiaries or
affiliates; provided that the Employee (i) may be a shareholder and director of
Cura Hospitality, Inc. and (ii) may, following the termination of the Employee
Term, provide consulting services to nursing homes that elect to self-operate
their food service operations.
(b) Nondisclosure of Confidential Information. The Employee,
except in connection with his employment hereunder, shall not disclose to any
person or entity or use, either during the Employee Term or at any time
thereafter, any information not in the public domain or generally known in the
industry, in any form, acquired by the Employee while performing the Services
for Best or any predecessor to Best's business or, if acquired following the
Employee Term, such information which, to the Employee's knowledge, has been
acquired, directly or indirectly, from any person or entity owing a duty of
confidentiality to Fine Host or Best or any of their subsidiaries or affiliates,
relating to Fine Host or Best, their subsidiaries or affiliates, including but
not limited to information regarding customers, vendors, suppliers, trade
secrets, training programs, manuals or materials, technical information,
contracts, systems, procedures, mailing lists, know-how, trade names,
improvements, price lists, financial or other data (including the revenues,
costs or profits associated with any of the products or services of Fine Host or
affiliates thereof (including Best)), business plans, code books, invoices and
other financial statements, computer programs, software systems, databases,
discs and printouts, plans (business, technical or otherwise), customer and
industry lists, correspondence, internal reports, personnel files, sales and
advertising material, telephone numbers, names, addresses or any other
compilation of information, written or unwritten, which is or was used in the
business of Fine Host or Best, or any subsidiaries or affiliates thereof. The
Employee agrees and acknowledges that all of such information, in any form, and
copies and extracts thereof, are and shall remain the sole and exclusive
property of Best, and upon termination of this Agreement, the Employee shall
return to Best the originals and all copies of any such information provided to
or acquired by the Employee in connection with the performance of the services,
and shall return to Best all files, correspondence and/or other communications
received maintained and/or originated by the Employee during the Employee Term.
(c) No Interference. During the Restricted Period, the
Employee shall not, whether for his own account or for the account of any other
individual, partnership, firm, corporation or other business organization (other
than Fine Host or Best), directly or indirectly solicit, endeavor to entice away
from Best, its affiliates or subsidiaries, or otherwise directly interfere with
the relationship of Best, its affiliates or subsidiaries with any person who, to
the knowledge of the Employee, is employed by or otherwise engaged to perform
services for Best, its affiliates or subsidiaries (including, but not limited
to, any independent sales representative or organizations) or who is, or was
within the then most recent twelve-month period, a customer or client, of Best,
its predecessors or any of its subsidiaries or affiliates. The placement of any
general classified or "help wanted" advertisements and/or general solicitations
to the public at large shall not constitute a violation of this Section 7(c)
unless the Employee's name is contained in such advertisements or solicitations.
(d) Inventions, etc. The Employee hereby sells, transfers and
assigns to Best, or to any person or entity designated by Best, all of the
right, title and interest of the Employee in and to all inventions, sales
approaches or materials, software, ideas, training materials, disclosures and
improvements, whether patented or unpatented, and copyrightable material, made
or conceived by the Employee, solely or jointly, in whole or in part, during the
Employee Term which are not generally known to the public or the industry or
recognized as standard practice and which (i) relate to services, trade names,
methods, ideas, apparatus, designs, products, processes or devices which may be
sold, leased, used or under construction or development by Best, its
subsidiaries or affiliates or any franchise affiliated with Best and (ii) arise
(wholly or partly) from the efforts of the Employee during his employment with
Best (an "Invention"). The Employee shall communicate promptly and disclose to
Best, in such form as Best requests, all information, details and data
pertaining to any such Invention. The Employee hereby irrevocably appoints the
President and Chief Operating Officer of Fine Host as his true and lawful
attorney to execute and deliver, with respect to any Invention, such form of
transfers and assignments and such other papers and documents as reasonably may
be required to permit Best or any person or entity designated by Best to file
and prosecute patent applications and, as to copyrightable material, to obtain
copyrights thereon. Best shall pay all costs incident to the execution and
delivery of such transfers, assignments and other documents. Any Invention by
the Employee within twelve (12) months following the termination of this
Agreement shall be deemed to fall within the provisions of this Section 7(d)
unless the Employee bears the burden of proof of showing that the Invention was
first conceived and made following such termination.
8. Injunctive Relief. Without intending to limit the remedies
available to Best, the Employee acknowledges that a breach of any of the
covenants contained in Section 7 hereof may result in material irreparable
injury to Best or its subsidiaries or affiliates for which there is no adequate
remedy at law, that it will not be possible to measure damages for such injuries
precisely and that, in the event of such a breach or threat thereof Best shall
be entitled to obtain a temporary restraining order and/or a preliminary or
permanent injunction, without the necessity of proving irreparable harm or
injury as a result of such breach or threatened breach of Section 7 hereof,
restraining the Employee from engaging in activities prohibited by Section 7
hereof or such other relief as may be required specifically to enforce any of
the covenants in Section 7 hereof.
9. Extension of Restricted Period. In addition to the remedies
Best may seek and obtain pursuant to Sections 7 and 8 of this Agreement, the
Restricted Period shall be extended by any and all periods during which the
Employee shall be found by a court to have been in violation of the covenants
contained in Section 7 hereof.
10. Audit and Records. The Employee shall keep accurate
records and books of account showing all charges, disbursements, and expenses
made or incurred by the Employee in the performance of the Services. Best shall
have the right, upon reasonable notice, to audit at any time up to one year
after payment of its final invoice, the direct costs, expenses, and
disbursements made with respect to the Services.
11. Assignability. This Agreement shall be binding upon and
inure to the benefit of the parties, their legal representatives, successors,
and assigns. This Agreement may not be assigned, transferred, conveyed, or
encumbered, whether voluntarily or by operation of law, by the Employee without
the prior written consent of Best (which may be granted or withheld in Best's
sole and absolute judgment).
12. Notices, Etc. All notices, demands, and other
communications provided for hereunder shall be in writing (including facsimile
or similar transmission) and mailed (by U.S. certified mail, return receipt
requested, postage prepaid), sent, or delivered (including by way of overnight
courier service), (i) if to the Employee to Perry M. Rynders, 1145 Aquarius
Lane, Eagan, MN 55123, (and in the case of facsimile transmission, to telecopy
no. ]; and (ii) if to Best, to 3 Greenwich Office Park, Greenwich, Connecticut
06831, and in the case of facsimile transmission, to telecopy no. (203)
629-5089, in each case to the attention of Ellen Keats, Esq.; or, as to each
party, to such other person and/or at such other address or number as shall be
designated by such party in a written notice to the other party. All such
notices, demands, and communications, if mailed, shall be effective upon the
earlier of (i) actual receipt by the addressee, (ii) the date shown on the
return receipt of such mailing or (iii) three (3) days after deposit in the
mail. All such notices, demands, and communications, if not mailed, shall be
effective upon the earlier of (i) actual receipt by the addressee, (ii) with
respect to facsimile and similar electronic transmission, the earlier of (x) the
time that electronic confirmation of a successful transmission is received or
(y) the date of transmission, if a confirming copy of the transmission is also
mailed as described above on the date of transmission, and (iii) with respect to
delivery by overnight courier service, the day after deposit with the courier
service, if delivery on such day by such courier is confirmed with the courier
or the recipient orally or in writing.
13. Amendments; Entire Agreement. This Agreement
constitutes the entire understanding and agreement between the parties and
supersedes all previous understandings, agreements, communications, and
representations, whether written or oral, concerning the treatment of
information and other matters to which this Agreement relates. No modification,
amendment, or waiver of any provision of this Agreement shall be effective
unless the same shall be in writing and signed by each of the parties hereto.
Any waiver of any provision of this Agreement shall be effective only in the
specific instance and for the specific purpose for which given.
14. Severability and Governing Law. The Employee acknowledges
and agrees that the covenants set forth in Section 7 hereof are reasonable and
valid in geographical and temporal scope and in all other respects. If any of
such covenants or such other provisions of this Agreement are found to be
invalid or unenforceable by a final determination of a court of competent
jurisdiction (a) the remaining terms and provisions hereof shall be unimpaired
and (b) the invalid or unenforceable term or provision shall be deemed replaced
by a term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision. THIS
AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED AND ENFORCED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF MINNESOTA WITHOUT GIVING EFFECT TO THE CHOICE OF LAW
PROVISIONS THEREOF.
15. No Waiver; Remedies. No failure on the part of any party
to exercise, and no delay in exercising, any right, power, or privilege
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right hereunder preclude any other or further exercise thereof
or the exercise of any other right. The remedies herein provided are cumulative
and not exclusive of any remedies provided by law.
16. Captions. The captions contained in this Agreement are for convenience
only and shall not affect the construction or interpretation of any provisions
of this Agreement.
17. Counterparts. This Agreement may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
when taken together shall constitute one and the same instrument. One or more
counterparts of this Agreement may be delivered via telecopier with the
intention that they shall have the same effect as an original executed
counterpart hereof.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
--------------------------------
Perry M. Rynders
BEST, INC.
By:_____________________________
Name:
Title:
FINE HOST CORPORATION
Computation of Per Share Earnings
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 24, September 25, September 24, September 25,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Income applicable to Common Stock $ 2,986 $ 1,399 $ 5,085 $ 1,908
Stock warrant accretion -- -- -- (1,300)
--------- --------- --------- ---------
Net income available to Common
Stockholders $ 2,986 $ 1,399 $ 5,085 $ 608
========= ========= ========== =========
Weighted average number of common shares
Outstanding 8,950,186 6,165,475 8,494,129 3,209,653
Average convertible Preferred shares
outstanding -- -- -- 939,197
Assumed conversion of:
Warrants -- -- -- 292,502
Options 492,266 83,194 452,547 83,420
Subordinated Notes 17,615 -- 36,404 --
--------- --------- --------- ----------
Average number of shares of Common Stock
outstanding assuming full dilution 9,460,067 6,248,669 8,983,080 4,524,772
========= ========= ========= =========
Net income per share assuming full dilution $ .32 $ .22 $ .57 $ .13
========= ========= ========= =========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL
INFORMATION EXTRACTED FROM THE BALANCE SHEET AND
INCOME STATEMENT FOR THE THREE MONTHS ENDED
SEPTEMBER 24, 1997 FOR FINE HOST CORPORATION, AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0001011584
<NAME> Fine Host Corporation
<MULTIPLIER> 1,000
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> DEC-26-1996
<PERIOD-END> SEP-24-1997
<EXCHANGE-RATE> 1.00
<CASH> 5,557
<SECURITIES> 0
<RECEIVABLES> 35,793
<ALLOWANCES> 0
<INVENTORY> 6,565
<CURRENT-ASSETS> 53,434
<PP&E> 60,068
<DEPRECIATION> 20,722
<TOTAL-ASSETS> 214,768
<CURRENT-LIABILITIES> 37,001
<BONDS> 0
0
0
<COMMON> 91
<OTHER-SE> 113,201
<TOTAL-LIABILITY-AND-EQUITY> 214,768
<SALES> 173,283
<TOTAL-REVENUES> 173,283
<CGS> 154,277
<TOTAL-COSTS> 163,176
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,319
<INCOME-PRETAX> 8,788
<INCOME-TAX> 3,703
<INCOME-CONTINUING> 10,107
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,085
<EPS-PRIMARY> .57
<EPS-DILUTED> .57
</TABLE>
