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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) November 24, 1998
-----------------
Penton Media, Inc.
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(Exact Name of Registrant as Specified in its Charter)
Delaware 1-14337 36-2875386
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(State or Other (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Incorporation)
1100 Superior Avenue, Cleveland, Ohio 44114
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (216) 696-7000
------------------------------
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On November 24, 1998, Internet World Media, Inc. ("Purchaser"), a
wholly owned subsidiary of Penton Media, Inc. (the "Company"), acquired
8,989,114 shares of Mecklermedia Corporation ("Mecklermedia") common stock,
representing approximately 98.6% of the outstanding shares of common stock of
Mecklermedia, for a cash price of $29.00 per share. The shares were purchased
pursuant to a tender offer to acquire all of the outstanding shares of
Mecklermedia common stock commenced on October 15, 1998.
On November 24, 1998, the Company completed the merger (the "First
Merger") of Purchaser with and into Mecklermedia (the "Surviving Corporation").
Upon consummation of the merger, the Surviving Corporation became a wholly owned
subsidiary of the Company and the shareholders of Mecklermedia who did not
tender their shares became entitled to receive $29.00 per share. The total
purchase price for Mecklermedia was approximately $274.0 million for the
tendered shares, which includes certain additional amounts to be paid in respect
of outstanding stock options and warrants.
Upon consummation of the First Merger, iWorld Corporation ("iWorld"), a
wholly owned subsidiary of the Surviving Corporation, was merged (the "Second
Merger") into Internet.com LLC ("Internet.com"), a Delaware limited liability
company, which was the surviving entity in the Second Merger. Upon consummation
of the Second Merger, the Surviving Corporation, which was the sole member of
Internet.com, sold 80.1% of its membership interest in Internet.com to Alan M.
Meckler for an aggregate purchase price of $18.0 million. The Surviving
Corporation retained the remaining 19.9% membership interest and a warrant to
acquire additional membership interests up to a 29.0% membership interest.
The funds used to consummate the tender offer came from borrowings of
the Company under a Credit Agreement, dated as of November 24, 1998 among the
Company, as borrower, the lenders listed therein, as lenders, DLJ Capital
Funding, Inc., as syndication agent, The Bank of New York and Key Corporate
Capital, Inc., as co-documentation agents, and First Union National Bank, as
administrative agent. The Credit Agreement has an availability of $300 million.
Mecklermedia is a leading provider of information about the Internet
through its (i) Internet World and ISPCON trade shows and conferences, (ii)
publication of Internet World, a weekly controlled circulation newspaper, (iii)
publication of Boardwatch, a monthly general circulation magazine, (iv)
publication of the Directory of Internet Service Providers, a periodic general
circulation publication, and (v) Internet.com (formerly iWorld), Mecklermedia's
network of Web Sites for Internet news and information resources.
ITEM 5. OTHER EVENTS.
On December 1, 1998, Ariff Alidina, an alleged former stockholder of
Mecklermedia, filed a purported class action lawsuit in the United States
District Court for the Southern District of New York against the Company and
Purchaser (the "Defendants"). The complaint generally alleges that the
Defendants violated the federal securities laws by selling Mr. Meckler an 80.1%
interest in Internet.com for what plaintiff alleges was a below market price,
thereby giving to
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Mr. Meckler more consideration for his common stock in Mecklermedia than was
paid to the other stockholders of Mecklermedia. The complaint generally seeks
damages in an unspecified amount, as well as other relief. The Defendants
believe the allegations contained in the complaint are without merit and intend
to contest them vigorously.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS.
(a) Financial Statements of Business Acquired.
The financial statements of Mecklermedia for the periods
specified in Rule 3-05(b) of Regulation S-X will be filed by
amendment to this Current Report on Form 8-K not later than
sixty (60) days after the date on which this Current Report on
Form 8-K is required to be filed.
(b) Pro Forma Financial Information.
The Pro Forma financial statements of Mecklermedia required
pursuant to Article 11 of Regulation S-X will be filed by
amendment to this Current Report on Form 8-K not later than
sixty (60) days after the date on which this Current Report on
Form 8-K is required to be filed.
(c) Exhibits.
2.1 Agreement and Plan of Merger, dated as of October 7, 1998, by
and among Penton Media, Inc., Internet World Media, Inc.,
Mecklermedia Corporation and Alan M. Meckler (incorporated
herein by reference to Exhibit 2.1 to the Registrant's Form
8-K filed with the Commission on October 15, 1998).
99.1 Credit Agreement, dated as of November 24, 1998, among the
Company, as borrower, the lenders listed therein, as lenders,
DLJ Capital Funding, Inc., as syndication agent, The Bank of
New York and Key Corporate Capital, Inc., as co-documentation
agents, and First Union National Bank, as administrative
agent.
99.2 Tender, Voting and Option Agreement, dated October 7, 1998, by
and among Penton Media, Inc., Internet World Media, Inc.,
Mecklermedia Corporation and Alan M. Meckler (incorporated
herein by reference to Exhibit 99.1 to the Registrant's Form
8-K filed with the Commission on October 15, 1998).
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SIGNATURES
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 hereunto duly authorized.
PENTON MEDIA, INC.
Dated: December 9, 1998
By: /s/ Joseph G. NeCastro
---------------------------------
Name: Joseph G. NeCastro
Title: Chief Financial Officer
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EXHIBIT INDEX
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Exhibit
No.
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2.1 Agreement and Plan of Merger, dated as of October 7, 1998, by
and among Penton Media, Inc., Internet World Media, Inc.,
Mecklermedia Corporation and Alan M. Meckler (incorporated
herein by reference to Exhibit 2.1 to the Registrant's Form
8-K filed with the Commission on October 15, 1998).
99.1 Credit Agreement, dated as of November 24, 1998, among the
Company, as borrower, the lenders listed therein, as lenders,
DLJ Capital Funding, Inc., as syndication agent, The Bank of
New York and Key Corporate Capital, Inc., as co-documentation
agents, and First Union National Bank, as administrative
agent.
99.2 Tender, Voting and Option Agreement, dated October 7, 1998, by
and among Penton Media, Inc., Internet World Media, Inc.,
Mecklermedia Corporation and Alan M. Meckler (incorporated
herein by reference to Exhibit 99.1 to the Registrant's Form
8-K filed with the Commission on October 15, 1998).
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Exhibit 99.1
EXECUTION VERSION
CREDIT AGREEMENT
DATED AS OF NOVEMBER 24, 1998
AMONG
PENTON MEDIA, INC.
AS BORROWER,
THE LENDERS LISTED HEREIN,
AS LENDERS,
DLJ CAPITAL FUNDING, INC.,
AS SYNDICATION AGENT,
THE BANK OF NEW YORK AND KEY CORPORATE CAPITAL INC.,
AS CO-DOCUMENTATION AGENTS
AND
FIRST UNION NATIONAL BANK,
AS ADMINISTRATIVE AGENT,
ARRANGED BY:
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
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PENTON MEDIA, INC.
CREDIT AGREEMENT
TABLE OF CONTENTS
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<TABLE>
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PAGE
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SECTION 1. DEFINITIONS....................................................................................3
1.1 Certain Defined Terms...........................................................3
1.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations Under
Agreement......................................................................32
1.3 Other Definitional Provisions and Rules of Construction........................32
SECTION 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS....................................................33
2.1 Commitments; Making of Loans; Notes............................................33
2.2 Interest on the Loans..........................................................40
2.3 Fees...........................................................................44
2.4 Repayments, Prepayments and Reductions in Revolving Loan Commitments;
General Provisions Regarding Payments; Application of Proceeds of
Collateral and Payments Under Subsidiary Guaranty..............................45
2.5 Use of Proceeds................................................................54
2.6 Special Provisions Governing Eurodollar Rate Loans.............................55
2.7 Increased Costs; Taxes; Capital Adequacy.......................................57
2.8 Obligation of Lenders and Issuing Lenders to Mitigate; Replacement of
Lenders........................................................................61
SECTION 3. LETTERS OF CREDIT.............................................................................62
3.1 Issuance of Letters of Credit and Lenders' Purchase of Participations
Therein........................................................................62
3.2 Letter of Credit Fees..........................................................65
3.3 Drawings and Reimbursement of Amounts Paid Under Letters of Credit.............65
3.4 Obligations Absolute...........................................................68
3.5 Indemnification; Nature of Issuing Lenders' Duties.............................69
3.6 Increased Costs and Taxes Relating to Letters of Credit........................70
SECTION 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT.....................................................71
4.1 Conditions to Term Loans and Initial Revolving Loans and Swing Line Loans......71
4.2 Conditions to All Loans........................................................79
4.3 Conditions to Letters of Credit................................................80
SECTION 5. COMPANY'S REPRESENTATIONS AND WARRANTIES......................................................81
</TABLE>
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<TABLE>
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5.1 Organization, Powers, Qualification, Good Standing, Business and
Subsidiaries...................................................................81
5.2 Authorization of Borrowing, etc................................................82
5.3 Financial Condition............................................................83
5.4 No Material Adverse Change; No Restricted Junior Payments......................83
5.5 Title to Properties; Liens; Real Property......................................83
5.6 Litigation; Adverse Facts......................................................84
5.7 Payment of Taxes...............................................................84
5.8 Performance of Agreements; Materially Adverse Agreements.......................85
5.9 Governmental Regulation........................................................85
5.10 Securities Activities..........................................................85
5.11 Employee Benefit Plans.........................................................85
5.12 Certain Fees...................................................................86
5.13 Environmental Protection.......................................................86
5.14 Employee Matters...............................................................87
5.15 Solvency.......................................................................87
5.16 Matters Relating to Collateral.................................................87
5.17 Related Agreements.............................................................88
5.18 Disclosure.....................................................................89
5.19 Year 2000 Compliance...........................................................89
SECTION 6. COMPANY'S AFFIRMATIVE COVENANTS...............................................................89
6.1 Financial Statements and Other Reports.........................................90
6.2 Corporate Existence, etc.......................................................95
6.3 Payment of Taxes and Claims; Tax Consolidation.................................95
6.4 Maintenance of Properties; Insurance; Application of Net Insurance/
Condemnation Proceeds..........................................................95
6.5 Inspection Rights; Appraisals of Real Estate; Lender Meeting...................97
6.6 Compliance with Laws, etc......................................................98
6.7 Environmental Review and Investigation, Disclosure, Etc.; Company's
Actions Regarding Hazardous Materials Activities, Environmental Claims
and Violations of Environmental Laws; Environmental Indemnity..................98
6.8 Execution of Subsidiary Guaranty and Personal Property Collateral
Documents by Certain Subsidiaries and Future Subsidiaries.....................101
6.9 Conforming Leasehold Interests; Matters Relating to Additional Real
Property Collateral...........................................................102
6.10 Interest Rate Protection......................................................104
6.11 Year 2000 Compliance..........................................................104
6.12 Merger........................................................................104
SECTION 7. COMPANY'S NEGATIVE COVENANTS.................................................................107
7.1 Indebtedness..................................................................107
7.2 Liens and Related Matters.....................................................108
7.3 Investments; Joint Ventures...................................................110
7.4 Contingent Obligations........................................................110
</TABLE>
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<TABLE>
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7.5 Restricted Junior Payments....................................................111
7.6 Financial Covenants...........................................................111
7.7 Restriction on Fundamental Changes; Asset Sales and Acquisitions..............114
7.8 Consolidated Capital Expenditures.............................................116
7.10 Sales and Lease-Backs.........................................................117
7.11 Sale or Discount of Receivables...............................................117
7.12 Transactions with Shareholders and Affiliates.................................117
7.13 Disposal of Subsidiary Stock..................................................117
7.14 Conduct of Business...........................................................118
7.15 Amendments or Waivers of Certain Related Agreements...........................118
7.16 Fiscal Year...................................................................118
SECTION 8. EVENTS OF DEFAULT............................................................................118
8.1 Failure to Make Payments When Due.............................................118
8.2 Default in Other Agreements...................................................119
8.3 Breach of Certain Covenants...................................................119
8.4 Breach of Warranty............................................................119
8.5 Other Defaults Under Loan Documents...........................................119
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc..........................119
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc............................120
8.8 Judgments and Attachments.....................................................120
8.9 Dissolution...................................................................120
8.10 Employee Benefit Plans........................................................120
8.11 Change in Control ............................................................121
8.12 Invalidity of Subsidiary Guaranty; Failure of Security; Repudiation of
Obligations...................................................................121
8.13 Failure to Consummate Tender Offer or Merger..................................122
SECTION 9. THE AGENTS...................................................................................123
9.1 Appointment...................................................................123
9.2 Powers and Duties; General Immunity...........................................124
9.3 Representations and Warranties; No Responsibility For Appraisal of
Creditworthiness..............................................................126
9.4 Right to Indemnity............................................................126
9.5 Successor Agents and Swing Line Lender........................................127
9.6 Collateral Documents and Subsidiary Guaranty..................................128
SECTION 10. MISCELLANEOUS...............................................................................129
10.1 Assignments and Participations in Loans and Letters of Credit.................129
10.2 Expenses......................................................................131
10.3 Indemnity.....................................................................132
10.4 Set-Off; Security Interest in Deposit Accounts................................133
10.5 Ratable Sharing...............................................................134
10.6 Amendments and Waivers........................................................134
10.7 Independence of Covenants.....................................................136
10.8 Notices.......................................................................136
10.9 Survival of Representations, Warranties and Agreements........................136
</TABLE>
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<TABLE>
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10.10 Failure or Indulgence Not Waiver; Remedies Cumulative..........................137
10.11 Marshalling; Payments Set Aside................................................137
10.12 Severability...................................................................137
10.13 Obligations Several; Independent Nature of Lenders' Rights.....................137
10.14 Headings.......................................................................138
10.15 Applicable Law.................................................................138
10.16 Successors and Assigns.........................................................138
10.17 Consent to Jurisdiction and Service of Process.................................138
10.18 Waiver of Jury Trial...........................................................139
10.19 Confidentiality................................................................140
10.20 Counterparts; Effectiveness....................................................140
Signature pages .........................................................................................S-1
</TABLE>
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EXHIBITS
I FORM OF NOTICE OF BORROWING
II FORM OF NOTICE OF CONVERSION/CONTINUATION
III FORM OF NOTICE OF ISSUANCE OF LETTER OF CREDIT
IV FORM OF TRANCHE A TERM NOTE
V FORM OF TRANCHE B TERM NOTE
VI FORM OF REVOLVING NOTE
VII FORM OF SWING LINE NOTE
VIII FORM OF COMPLIANCE CERTIFICATE
IX FORM OF OPINION OF JONES, DAY, REAVIS & POGUE
X FORM OF OPINION OF O'MELVENY & MYERS LLP
XI FORM OF ASSIGNMENT AGREEMENT
XII FORM OF CERTIFICATE RE NON-BANK STATUS
XIII FORM OF FINANCIAL CONDITION CERTIFICATE
XIV FORM OF COLLATERAL ACCOUNT AGREEMENT
XV FORM OF COMPANY PLEDGE AGREEMENT
XVI FORM OF COMPANY SECURITY AGREEMENT
XVII FORM OF SUBSIDIARY GUARANTY
XVIII FORM OF SUBSIDIARY PLEDGE AGREEMENT
XIX FORM OF SUBSIDIARY SECURITY AGREEMENT
XX FORM OF MORTGAGE
XXI FORM OF NOTICE OF ACCOUNT DESIGNATION
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SCHEDULES
1.1A EXISTING COMPANY INDEBTEDNESS
2.1 LENDERS' COMMITMENTS AND PRO RATA SHARES
4.1D CORPORATE AND CAPITAL STRUCTURE; OWNERSHIP
4.1M CLOSING DATE MORTGAGED PROPERTIES
5.1 SUBSIDIARIES OF COMPANY
5.5 REAL PROPERTY
5.6 LITIGATION
5.11 CERTAIN EMPLOYEE BENEFIT PLANS
5.13 ENVIRONMENTAL MATTERS
7.1 CERTAIN EXISTING INDEBTEDNESS
7.2 CERTAIN EXISTING LIENS
7.3 CERTAIN EXISTING INVESTMENTS
7.4 CERTAIN EXISTING CONTINGENT OBLIGATIONS
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PENTON MEDIA, INC.
CREDIT AGREEMENT
This CREDIT AGREEMENT is dated as of November 24, 1998, and entered
into by and among PENTON MEDIA, INC., a Delaware corporation ("COMPANY"), THE
LENDERS LISTED ON THE SIGNATURE PAGES HEREOF (each individually referred to
herein as a "LENDER" and collectively as "LENDERS"), DLJ CAPITAL FUNDING, INC.
("DLJ"), as syndication agent hereunder for Lenders (in such capacity,
"SYNDICATION AGENT"), THE BANK OF NEW YORK and KEY CORPORATE CAPITAL INC., as
Co-Documentation Agents (each, a "Documentation Agent" and together, the
"Documentation Agents"), and FIRST UNION NATIONAL BANK ("FIRST UNION"), as
administrative agent for Lenders (in such capacity, "ADMINISTRATIVE AGENT").
R E C I T A L S
- - - - - - - -
WHEREAS, Company has formed, and owns all of the outstanding
shares of capital stock of, Merger Sub (this and other capitalized terms used in
these recitals without definition being used as defined in subsection 1.1), for
the purpose of acquiring all of the outstanding shares of common stock of Target
(such common stock being the "TARGET COMMON STOCK");
WHEREAS, Merger Sub has offered to purchase all of the issued
and outstanding shares of Target Common Stock at a price not to exceed $29.00
per share pursuant to the Tender Offer;
WHEREAS, Merger Sub, Target and Alan M. Meckler have entered
into the Tender, Voting and Option Agreement pursuant to which Alan M. Meckler
has granted an option to Merger Sub to purchase his shares of Target Common
Stock, which constitute approximately 26% of the outstanding Target Common Stock
on a fully diluted basis, at $29.00 per share, and has agreed to tender such
shares pursuant to the Tender Offer;
WHEREAS, Company, Merger Sub, Target and Alan M. Meckler have
entered into the Merger Agreement pursuant to which, upon completion of the
Tender Offer and, with respect to clauses (i) and (ii) below, upon receipt of
the approval by holders of at least a majority of the outstanding shares of
Target Common Stock (if required by law):
(i) Merger Sub will merge with Target pursuant to the Merger
Agreement with Target being the surviving corporation in such merger
(such surviving corporation is sometimes referred to herein as the
"SURVIVING CORPORATION");
(ii) Each of the shares of Target Common Stock outstanding
immediately before the consummation of the Merger (other than shares to
be cancelled as described in clause (iii) below and shares held by
those who perfect appraisal rights under Section 262
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of the Delaware General Corporation Law) will be converted into the
right to receive a cash payment of $29.00 per share;
(iii) Each of the shares of Target Common Stock outstanding
immediately before the consummation of the Merger held by Merger Sub,
Target or any of their respective direct or indirect Subsidiaries (the
"OTHER TARGET SHARES") shall be cancelled and retired without payment
of any consideration therefor;
(iv) As a result of the Merger, each of the shares of the
capital stock of Merger Sub outstanding immediately before the
consummation of the Merger will be converted into and become one fully
paid and nonassessable share of common stock of Surviving Corporation
(the "SURVIVING CORPORATION COMMON STOCK"); and
(v) Following the Merger, all of the outstanding shares of
Surviving Corporation Common Stock will be owned by Company;
WHEREAS, Target shall use all reasonable efforts to provide
that, upon consummation of the Merger, all options granted under any of Target's
stock option plans and all warrants to purchase shares of Target Common Stock
granted under the agreements referred to in Section 4.2 of the Merger Agreement
(collectively, the "TARGET STOCK OPTIONS") shall be acquired by Target at a
price equal to the difference between $29.00 per Target Stock Option and the
exercise price thereof;
WHEREAS, Company desires that Lenders extend certain credit
facilities to Company to provide for (i) the payment of the consideration for
the Tendered Target Shares and the purchase of the Target Stock Options in an
aggregate amount not exceeding $274,000,000; (ii) the payment of Transaction
Costs in an aggregate amount not exceeding $16,500,000; (iii) the repayment of
the Existing Company Indebtedness (together with accrued interest) in an amount
of approximately $41,500,000; (iv) the working capital requirements and general
corporate purposes of Company and its Subsidiaries; (v) the issuance of Letters
of Credit as described herein; and (vi) the other purposes described herein;
WHEREAS, Company desires to secure all of the Obligations
hereunder and under the other Loan Documents by granting to Administrative
Agent, on behalf of Lenders, a first priority Lien on substantially all of its
personal property and real property, including a pledge of all of the capital
stock of its Domestic Subsidiaries (other than Target before the Merger) and a
pledge of 65% of the capital stock of its first tier Foreign Subsidiaries; and
WHEREAS, Company has agreed to cause its Domestic Subsidiaries
(including Target and Target's Domestic Subsidiaries) to guarantee the
Obligations hereunder and under the other Loan Documents and to secure their
guaranties by granting to Administrative Agent, on behalf of Lenders, a first
priority Lien on substantially all of their personal property and real property,
including a pledge of all of the capital stock of their Domestic Subsidiaries
and a pledge of 65% of the capital stock of their first tier Foreign
Subsidiaries;
2
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NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, Company, Lenders and
Agents, agree as follows:
SECTION 1. DEFINITIONS
1.1 CERTAIN DEFINED TERMS.
The following terms used in this Agreement shall have the following meanings:
"ACQUIRED BUSINESS" has the meaning assigned thereto in
subsection 7.7(vi).
"ACQUISITION FINANCING REQUIREMENTS" means the aggregate of
all amounts necessary (i) to finance the purchase price of the Tendered Target
Shares purchased pursuant to the Tender Offer and the Tender, Voting and Option
Agreement, (ii) to finance the payment of the consideration payable under the
Merger Agreement in respect of shares of Target Common Stock that have been
converted into the right to receive a cash payment pursuant to the Merger
Agreement, (iii) to finance the purchase of Target Stock Options, (iv) to repay
in full the Existing Company Indebtedness, and (v) to pay Transaction Costs.
"ACQUISITION INDEBTEDNESS" means (i) the Indebtedness of an
Acquired Business assumed by any of Company's Subsidiaries in connection with a
Permitted Acquisition of such Acquired Business; PROVIDED that such Indebtedness
was not incurred in connection with or for the purpose of financing such
Permitted Acquisition, and (ii) Indebtedness consisting of deferred purchase
price obligations owed to the seller of such Acquired Business and earnout or
similar obligations owed to the seller of such Acquired Business.
"ADDITIONAL MORTGAGED PROPERTY" has the meaning assigned to
such term in subsection 6.9.
"ADJUSTED EURODOLLAR RATE" means, for any Interest Rate
Determination Date with respect to an Interest Period for a Eurodollar Rate
Loan, the rate per annum (rounded upwards, if necessary, to the next higher
1/100%) obtained by DIVIDING (i) the Eurodollar Rate for such Eurodollar Rate
Loan and such Interest Period BY (ii) a percentage equal to 100% MINUS the
stated maximum rate of all reserve requirements (including any marginal,
emergency, supplemental, special or other reserves) applicable on such Interest
Rate Determination Date to any member bank of the Federal Reserve System in
respect of "Eurocurrency liabilities" as defined in Regulation D (or any
successor category of liabilities under Regulation D).
"ADMINISTRATIVE AGENT" has the meaning assigned to that term
in the introduction to this Agreement and also means and includes any successor
Administrative Agent appointed pursuant to subsection 9.5A.
"AFFECTED LENDER" has the meaning assigned to that term in
subsection 2.6C.
"AFFILIATE", as applied to any Person, means any other Person
directly or indirectly
3
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controlling, controlled by, or under common control with, that Person. For the
purposes of this definition, "control" (including, with correlative meanings,
the terms "controlling", "controlled by" and "under common control with"), as
applied to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of that
Person, whether through the ownership of voting securities or by contract or
otherwise.
"AFFILIATED FUND" means, with respect to any Lender that is a
fund that invests in commercial loans, any other fund that invests in commercial
loans and is managed by the same investment advisor as such Lender or by an
Affiliate of such investment advisor.
"AGENTS" means, collectively, the Syndication Agent and the
Administrative Agent.
"AGREEMENT" means this Credit Agreement dated as of November
24, 1998, as it may be amended, supplemented or otherwise modified from time to
time.
"ANNUALIZED" means (i) with respect to the Fiscal Quarter of
Company ending March 31, 1999, the applicable amount for such Fiscal Quarter
multiplied by four, (ii) with respect to the Fiscal Quarter of Company ending
June 30, 1999, the applicable amount for such Fiscal Quarter and the immediately
preceding Fiscal Quarter multiplied by two, and (iii) with respect to the Fiscal
Quarter of Company ending September 30, 1999, the applicable amount for such
Fiscal Quarter and the immediately preceding two Fiscal Quarters multiplied by
one and one-third.
"APPLICABLE BASE RATE MARGIN", "APPLICABLE EURODOLLAR RATE
MARGIN" and "APPLICABLE COMMITMENT FEE PERCENTAGE" mean, as of any date of
determination, the percentage set forth below under the heading "Applicable Base
Rate Margin," "Applicable Eurodollar Rate Margin," or "Applicable Commitment Fee
Percentage" respectively, opposite the Consolidated Leverage Ratio as of the
last day of the most recently completed Fiscal Quarter preceding such date of
determination:
<TABLE>
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Consolidated Applicable Applicable Applicable
Leverage Eurodollar
Base Rate Commitment Fee
Ratio Rate Margin
----- -----------
Margin Percentage
------ ----------
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Greater than or equal 4.50:1.00 2.00% 3.00% .50%
to
- --------------------------------------------------------------------------------------------------------------------
Less than 4.50:1.00 1.75% 2.75% .50%
but greater than or 3.50:1.00
equal to
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<TABLE>
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<S> <C> <C> <C> <C>
Less than 3.50:1.00 1.50% 2.50% .50%
but greater than or 3.00:1.00
equal to
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
Less than 3.00:1.00 1.25% 2.25% .45%
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</TABLE>
PROVIDED that until the delivery of the first Margin Determination Certificate
pursuant to subsection 6.1(iv) after the six-month anniversary of the Closing
Date, the Applicable Base Rate Margin shall be 1.75%, the Applicable Eurodollar
Rate Margin shall be 2.75% and the Applicable Commitment Fee Percentage shall be
0.50%.
Upon delivery of a Margin Determination Certificate by Company
to Administrative Agent pursuant to subsection 6.1(iv), the Applicable Base Rate
Margin, the Applicable Eurodollar Rate Margin and the Applicable Commitment Fee
Percentage shall automatically be adjusted in accordance with such Margin
Determination Certificate, such adjustment to become effective on the third
Business Day following the receipt by Administrative Agent of such Margin
Determination Certificate; PROVIDED that if at any time a Margin Determination
Certificate is not delivered on or before the date required by subsection
6.1(iv) (each a "certificate delivery date"), the Consolidated Leverage Ratio
from and including such certificate delivery date to the date of delivery by
Company to the Administrative Agent of such Margin Determination Certificate
shall be conclusively presumed to be greater than 4.50:1.0 for purposes of
calculating the Applicable Base Rate Margin, the Applicable Eurodollar Rate
Margin and the Applicable Commitment Fee Percentage.
"ARRANGER" means Donaldson, Lufkin & Jenrette Securities
Corporation, as arranger of the credit facilities described herein.
"ASSET SALE" means the sale, lease, assignment or other
transfer (whether voluntary or involuntary) for value (collectively, a
"transfer") by Company or any of its Subsidiaries to any Person other than
Company or any of its wholly-owned Subsidiaries of (i) any of the equity
ownership of any of Company's Subsidiaries, (ii) substantially all of the assets
of any division or line of business (including any trade show or publication) of
Company or any of its Subsidiaries, or (iii) any other assets (whether tangible
or intangible) of Company or any of its Subsidiaries (other than (a) inventory
sold in the ordinary course of business, (b) Cash Equivalents, (c) obsolete
equipment transferred for not in excess of $500,000 in the aggregate for each
Fiscal Year, and (d) any such other assets to the extent that (i) the aggregate
value of such assets transferred in any single transaction or related series of
transactions is equal to $500,000 or less and (ii) the aggregate value of such
assets transferred in any Fiscal Year is equal to $1,000,000 or less.
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"ASSIGNMENT AGREEMENT" means an Assignment Agreement in
substantially the form of EXHIBIT XI annexed hereto.
"BANKRUPTCY CODE" means Title 11 of the United States Code
entitled "Bankruptcy", as now and hereafter in effect, or any successor statute.
"BASE RATE" means, at any time, the higher of (x) the Prime
Rate or (y) the rate which is 1/2 of 1% in excess of the Federal Funds Effective
Rate.
"BASE RATE LOANS" means Loans bearing interest at rates
determined by reference to the Base Rate as provided in subsection 2.2A.
"BUSINESS DAY" means (i) for all purposes other than as
covered by clause (ii) below, any day excluding Saturday, Sunday and any day
which is a legal holiday under the laws of the State of New York or the State of
North Carolina or is a day on which banking institutions located in such state
are authorized or required by law or other governmental action to close, and
(ii) with respect to all notices, determinations, fundings and payments in
connection with the Adjusted Eurodollar Rate or any Eurodollar Rate Loans, any
day that is a Business Day described in clause (i) above and that is also a day
for trading by and between banks in Dollar deposits in the interbank Eurodollar
market.
"CAPITAL LEASE", as applied to any Person, means any lease of
any property (whether real, personal or mixed) by that Person as lessee that, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that Person.
"CASH" means money, currency or a credit balance in a Deposit
Account.
"CASH EQUIVALENTS" means, as at any date of determination, (i)
marketable securities (a) issued or directly and unconditionally guaranteed as
to interest and principal by the United States Government or (b) issued by any
agency of the United States the obligations of which are backed by the full
faith and credit of the United States, in each case maturing within one year
after such date; (ii) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof, in each case maturing within one year after such
date and having, at the time of the acquisition thereof, the highest rating
obtainable from either Standard & Poor's Ratings Group ("S&P") or Moody's
Investors Service, Inc. ("MOODY'S"); (iii) commercial paper maturing no more
than one year from the date of creation thereof and having, at the time of the
acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from
Moody's; (iv) certificates of deposit or bankers' acceptances maturing within
one year after such date and issued or accepted by any Lender or by any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia that (a) is at least "adequately
capitalized" (as defined in the regulations of its primary Federal banking
regulator) and (b) has Tier 1 capital (as defined in such regulations) of not
less than $100,000,000; and (v) shares of any money market mutual fund that (a)
has at least 95% of its assets invested continuously in the types of investments
referred to in clauses (i) and (ii) above, (b) has net assets of not less than
$500,000,000, and (c) has the highest
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<PAGE> 14
rating obtainable from either S&P or Moody's.
"CERTIFICATE RE NON-BANK STATUS" means a certificate
substantially in the form of EXHIBIT XII annexed hereto delivered by a Lender to
Administrative Agent pursuant to subsection 2.7B(iii).
"CLASS" means, as applied to Lenders, each of the following
three classes of Lenders: (i) Lenders having Revolving Loan Exposure, (ii)
Lenders having Tranche A Term Loan Exposure, and (iii) Lenders having Tranche B
Term Loan Exposure.
"CLOSING DATE" means the date on or before December 31, 1998,
on which the initial Loans are made.
"CLOSING DATE MORTGAGED PROPERTY" has the meaning assigned to
such term in subsection 4.1M.
"CO-DOCUMENTATION AGENTS" means The Bank of New York and Key
Corporate Capital Inc., in their capacity as Co-Documentation Agents for the
Lenders.
"COLLATERAL" means, collectively, all of the real, personal
and mixed property (including capital stock) in which Liens are purported to be
granted pursuant to the Collateral Documents as security for the Obligations.
"COLLATERAL ACCOUNT" has the meaning assigned to that term in
the Collateral Account Agreement.
"COLLATERAL ACCOUNT AGREEMENT" means the Collateral Account
Agreement executed and delivered by Company and Administrative Agent on the
Closing Date, substantially in the form of EXHIBIT XIV annexed hereto, as such
Collateral Account Agreement may hereafter be amended, supplemented or otherwise
modified from time to time.
"COLLATERAL DOCUMENTS" means the Company Pledge Agreement, the
Company Security Agreement, the Collateral Account Agreement, the Subsidiary
Pledge Agreements, the Subsidiary Security Agreements, the Mortgages and all
other instruments or documents delivered by any Loan Party pursuant to this
Agreement or any of the other Loan Documents in order to grant to Administrative
Agent, on behalf of Lenders, a Lien on any real, personal or mixed property of
that Loan Party as security for the Obligations.
"COMMERCIAL LETTER OF CREDIT" means any letter of credit or
similar instrument issued for the purpose of providing the primary payment
mechanism in connection with the purchase of any materials, goods or services by
Company or any of its Subsidiaries in the ordinary course of business of Company
or such Subsidiary.
"COMMITMENTS" means the commitments of Lenders to make Loans
as set forth in subsection 2.1A.
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<PAGE> 15
"COMPANY" has the meaning assigned thereto in the preliminary
paragraph of this Agreement.
"COMPANY PLEDGE AGREEMENT" means the Company Pledge Agreement
executed and delivered by Company on the Closing Date, substantially in the form
of EXHIBIT XV annexed hereto, as such Company Pledge Agreement may thereafter be
amended, supplemented or otherwise modified from time to time.
"COMPANY SECURITY AGREEMENT" means the Company Security
Agreement executed and delivered by Company on the Closing Date, substantially
in the form of EXHIBIT XVI annexed hereto, as such Company Security Agreement
may thereafter be amended, supplemented or otherwise modified from time to time.
"COMPLIANCE CERTIFICATE" means a certificate substantially in
the form of EXHIBIT VIII annexed hereto delivered to Administrative Agent and
Lenders by Company pursuant to subsection 6.1(iv).
"CONFORMING LEASEHOLD INTEREST" means any Recorded Leasehold
Interest as to which the lessor has agreed in writing for the benefit of
Administrative Agent (which writing has been delivered to Administrative Agent),
whether under the terms of the applicable lease, under the terms of a Landlord
Consent and Estoppel, or otherwise, to the matters described in the definition
of "Landlord Consent and Estoppel," which interest, if a subleasehold or
sub-subleasehold interest, is not subject to any contrary restrictions contained
in a superior lease or sublease.
"CONSOLIDATED CAPITAL EXPENDITURES" means, for any period, the
sum of (i) the aggregate of all expenditures (whether paid in cash or other
consideration or accrued as a liability and including that portion of Capital
Leases which is capitalized on the consolidated balance sheet of Company and its
Subsidiaries) by Company and its Subsidiaries during that period that, in
conformity with GAAP, are included in "additions to property, plant or
equipment" or comparable items reflected in the consolidated statement of cash
flows of Company and its Subsidiaries PLUS (ii) to the extent not covered by
clause (i) of this definition, the aggregate of all expenditures by Company and
its Subsidiaries during that period (a) to purchase or develop computer software
or systems (whether or not such expenditures are capitalized on the consolidated
balance sheet of Company and its Subsidiaries in conformity with GAAP) or (b) to
acquire (by purchase or otherwise) the business, property or fixed assets of any
Person, or the stock or other evidence of beneficial ownership of any Person
that, as a result of such acquisition, becomes a Subsidiary of Company; PROVIDED
that Consolidated Capital Expenditures shall not include (i) the acquisition by
Company of Target or (ii) expenditures by Company and its Subsidiaries in
connection with Permitted Acquisitions.
"CONSOLIDATED CASH INTEREST EXPENSE" means, for any period,
Consolidated Interest Expense for such period EXCLUDING, HOWEVER, any interest
expense not payable in Cash (including amortization of discount and amortization
of debt issuance costs).
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<PAGE> 16
"CONSOLIDATED CURRENT ASSETS" means, as at any date of
determination, the total assets of Company and its Subsidiaries on a
consolidated basis which may properly be classified as current assets in
conformity with GAAP.
"CONSOLIDATED CURRENT LIABILITIES" means, as at any date of
determination, the total liabilities of Company and its Subsidiaries on a
consolidated basis which may properly be classified as current liabilities in
conformity with GAAP.
"CONSOLIDATED EBITDA" means, for any period, the sum of the
amounts for such period of (i) Consolidated Net Income, (ii) Consolidated
Interest Expense, (iii) provisions for taxes based on income, (iv) total
depreciation expense, (v) total amortization expense, and (vi) other non-cash
items reducing Consolidated Net Income LESS other non-cash items increasing
Consolidated Net Income, all of the foregoing as determined on a consolidated
basis for Company and its Subsidiaries in conformity with GAAP; PROVIDED that
all calculations of Consolidated EBITDA for any period that ends prior to the
Merger Date or that includes the Merger Date shall be made on a pro-forma basis
assuming the Tender Offer and the Merger were consummated on the first day of
such period.
"CONSOLIDATED EXCESS CASH FLOW" means, for any Fiscal Year, an
amount (if positive) equal to (i) the sum, without duplication, of the amounts
for such Fiscal Year of (a) Consolidated EBITDA and (b) the Consolidated Working
Capital Adjustment MINUS (ii) the sum, without duplication, of the amounts for
such Fiscal Year of (a) voluntary and scheduled repayments of all Indebtedness
of Company and its Subsidiaries determined on a consolidated basis in accordance
with GAAP (excluding repayments of Revolving Loans except to the extent the
Revolving Loan Commitments are permanently reduced in connection with such
repayments), (b) Consolidated Capital Expenditures (net of any proceeds of any
related financings with respect to such expenditures) to the extent paid in cash
during such Fiscal Year, (c) Consolidated Cash Interest Expense, (d) the
provision for current taxes based on income of Company and its Subsidiaries and
payable in cash with respect to such Fiscal Year, (e) Restricted Junior Payments
paid in cash during such Fiscal Year permitted under subsection 7.5, and (f) the
amount of Consolidated Capital Expenditures permitted to be carried forward to
the next Fiscal Year pursuant to the proviso in subsection 7.8 MINUS the amount
of permitted Consolidated Capital Expenditures carried forward to such Fiscal
Year (whether or not incurred) from the immediately preceding Fiscal Year.
"CONSOLIDATED FIXED CHARGE COVERAGE RATIO" means, as of any
date of determination, the ratio computed for the four Fiscal Quarter period
most recently ended on or before such date of determination of Consolidated
EBITDA to Consolidated Fixed Charges; PROVIDED that with respect to Consolidated
Fixed Charges for the Fiscal Quarters ending March 31, 1999, June 30, 1999, and
September 30, 1999, the calculations of Consolidated Cash Interest Expense and
taxes paid in cash during such period shall be determined on an Annualized
basis.
"CONSOLIDATED FIXED CHARGES" means, for any period, the sum
(without duplication) of the amounts for such period of (i) Consolidated Cash
Interest Expense, (ii) all
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<PAGE> 17
taxes paid in cash during such period, (iii) Consolidated Capital Expenditures
for such period paid in cash, (iv) the aggregate amount of scheduled payments of
principal on Indebtedness of Company and its Subsidiaries (including that
portion attributable to Capital Leases in accordance with GAAP) for such period,
and (v) the amount of Restricted Junior Payments paid in cash during such period
permitted under subsection 7.5, all of the foregoing as determined on a
consolidated basis for Company and its Subsidiaries in conformity with GAAP.
"CONSOLIDATED INTEREST COVERAGE RATIO" means, as of any date
of determination, the ratio computed for the four Fiscal Quarter period most
recently ended on or before such date of determination of (i) Consolidated
EBITDA to (ii) Consolidated Interest Expense; PROVIDED that for the Fiscal
Quarters ending March 31, 1999, June 30, 1999, and September 30, 1999,
Consolidated Interest Expense shall be determined on an Annualized basis.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, total
interest expense (including that portion attributable to Capital Leases in
accordance with GAAP and capitalized interest) of Company and its Subsidiaries
on a consolidated basis with respect to all outstanding Indebtedness of Company
and its Subsidiaries, including, without limitation, all commissions, discounts
and other fees and charges owed with respect to letters of credit and bankers'
acceptance financing and net costs under Interest Rate Agreements, but
excluding, however, any amounts referred to in subsection 2.3 payable to
Arranger and Agents on or before the Closing Date.
"CONSOLIDATED LEVERAGE RATIO" means, as of any date of
determination, the ratio of (a) the sum of (x) Consolidated Net Debt as of such
date PLUS (y) the aggregate amount of Contingent Obligations in respect of
Letters of Credit as of such date to (b) Consolidated EBITDA for the four Fiscal
Quarter period most recently ended on or before such date of determination.
"CONSOLIDATED NET DEBT" means, as at any date of
determination, the difference between (i) the aggregate stated balance sheet
amount of all Indebtedness of Company and its Subsidiaries MINUS (ii) the
aggregate amount of Cash and Cash Equivalents of Company and its Subsidiaries
(but not to exceed $5,000,000), in each case determined on a consolidated basis
in accordance with GAAP.
"CONSOLIDATED NET INCOME" means, for any period, the net
income (or loss) of Company and its Subsidiaries on a consolidated basis for
such period taken as a single accounting period determined in conformity with
GAAP; PROVIDED that there shall be excluded (i) the income (or loss) of any
Person (other than a Subsidiary of Company) in which any other Person (other
than Company or any of its Subsidiaries) has a joint interest, except to the
extent of the amount of dividends or other distributions actually paid to
Company or any of its Subsidiaries by such Person during such period, (ii) the
income (or loss) of any Person (other than Target and its Subsidiaries) accrued
prior to the date it becomes a Subsidiary of Company or is merged into or
consolidated with Company or any of its Subsidiaries or that Person's assets are
acquired by Company or any of its Subsidiaries, (iii) the income of any
Subsidiary of Company to the extent that the declaration or payment of dividends
or similar distributions by that Subsidiary of that
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<PAGE> 18
income is not at the time permitted by operation of the terms of its charter or
any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to that Subsidiary, (iv) any after-tax gains
or losses attributable to Asset Sales or returned surplus assets of any Pension
Plan, and (v) (to the extent not included in clauses (i) through (iv) above) any
net extraordinary gains or net non-cash extraordinary losses.
"CONSOLIDATED WORKING CAPITAL" means, as at any date of
determination, the excess of Consolidated Current Assets over Consolidated
Current Liabilities.
"CONSOLIDATED WORKING CAPITAL ADJUSTMENT" means, for any
period on a consolidated basis, the amount (which may be a negative number) by
which Consolidated Working Capital as of the beginning of such period exceeds
(or is less than) Consolidated Working Capital as of the end of such period.
"CONTINGENT OBLIGATION", as applied to any Person, means any
direct or indirect liability, contingent or otherwise, of that Person (i) with
respect to any Indebtedness, lease, dividend or other obligation of another if
the primary purpose or intent thereof by the Person incurring the Contingent
Obligation is to provide assurance to the obligee of such obligation of another
that such obligation of another will be paid or discharged, or that any
agreements relating thereto will be complied with, or that the holders of such
obligation will be protected (in whole or in part) against loss in respect
thereof, (ii) with respect to any letter of credit issued for the account of
that Person or as to which that Person is otherwise liable for reimbursement of
drawings, or (iii) under Hedge Agreements. Contingent Obligations shall include
(a) the direct or indirect guaranty, endorsement (otherwise than for collection
or deposit in the ordinary course of business), co-making, discounting with
recourse or sale with recourse by such Person of the obligation of another, (b)
the obligation to make take-or-pay or similar payments if required regardless of
non-performance by any other party or parties to an agreement, and (c) any
liability of such Person for the obligation of another through any agreement
(contingent or otherwise) (X) to purchase, repurchase or otherwise acquire such
obligation or any security therefor, or to provide funds for the payment or
discharge of such obligation (whether in the form of loans, advances, stock
purchases, capital contributions or otherwise) or (Y) to maintain the solvency
or any balance sheet item, level of income or financial condition of another if,
in the case of any agreement described under subclauses (X) or (Y) of this
sentence, the primary purpose or intent thereof is as described in the preceding
sentence. The amount of any Contingent Obligation shall be equal to the amount
of the obligation so guaranteed or otherwise supported or, if less, the amount
to which such Contingent Obligation is specifically limited.
"CONTRACTUAL OBLIGATION", as applied to any Person, means any
provision of any Security issued by that Person or of any material indenture,
mortgage, deed of trust, contract, undertaking, agreement or other instrument to
which that Person is a party or by which it or any of its properties is bound or
to which it or any of its properties is subject.
"CURRENCY AGREEMENT" means any foreign exchange contract,
currency swap agreement, futures contract, option contract, synthetic cap or
other similar agreement or
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arrangement to which Company or any of its Subsidiaries is a party.
"DEPOSIT ACCOUNT" means a demand, time, savings, passbook or
like account with a bank, savings and loan association, credit union or like
organization, other than an account evidenced by a negotiable certificate of
deposit.
"DEPOSITARY" means Harris Trust Company of New York.
"DLJ" has the meaning assigned to that term in the
introduction to this Agreement.
"DOLLARS" and the sign "$" mean the lawful money of the United
States of America.
"DOMESTIC SUBSIDIARY" means, with respect to any Person, any
Subsidiary of such Person incorporated in a jurisdiction of the United States of
America.
"ELIGIBLE ASSIGNEE" means (A) (i) a commercial bank organized
under the laws of the United States or any state thereof; (ii) a savings and
loan association or savings bank organized under the laws of the United States
or any state thereof; (iii) a commercial bank organized under the laws of any
other country or a political subdivision thereof; PROVIDED that (x) such bank is
acting through a branch or agency located in the United States or (y) such bank
is organized under the laws of a country that is a member of the Organization
for Economic Cooperation and Development or a political subdivision of such
country; and (iv) any other entity which is an "accredited investor" (as defined
in Regulation D under the Securities Act) which extends credit or buys loans as
one of its businesses including insurance companies, mutual funds and lease
financing companies; and (B) any Lender, any Affiliate of any Lender and any
Affiliated Fund of any Lender; PROVIDED that no Affiliate of Company shall be an
Eligible Assignee.
"EMPLOYEE BENEFIT PLAN" means any "employee benefit plan" as
defined in Section 3(3) of ERISA which is or was maintained or contributed to by
Company, any of its Subsidiaries or any of their respective ERISA Affiliates.
"ENVIRONMENTAL CLAIM" means any investigation, written notice,
notice of violation, claim, action, suit, proceeding, demand, abatement order or
other order or directive (conditional or otherwise), by any governmental
authority or any other Person, arising (i) pursuant to or in connection with any
actual or alleged violation of any Environmental Law, (ii) in connection with
any Hazardous Materials or any actual or alleged Hazardous Materials Activity,
or (iii) in connection with any actual or alleged damage, injury, threat or harm
to health, safety, natural resources or the environment.
"ENVIRONMENTAL LAWS" means any and all current or future
statutes, ordinances, orders, rules, regulations, judgments, Governmental
Authorizations, or any other requirements of governmental authorities relating
to (i) environmental matters, including those relating to any Hazardous
Materials Activity, (ii) the generation, use, storage, transportation or
disposal of
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Hazardous Materials, or (iii) occupational safety and health, industrial
hygiene, land use or the protection of human, plant or animal health or welfare,
in any manner applicable to Company or any of its Subsidiaries or any Facility,
including the Comprehensive Environmental Response, Compensation, and Liability
Act (42 U.S.C. Section 9601 ET SEQ.), the Hazardous Materials Transportation Act
(49 U.S.C. Section 1801 ET SEQ.), the Resource Conservation and Recovery Act (42
U.S.C. Section 6901 ET SEQ.), the Federal Water Pollution Control Act (33 U.S.C.
Section 1251 ET SEQ.), the Clean Air Act (42 U.S.C. Section 7401 ET SEQ.), the
Toxic Substances Control Act (15 U.S.C. Section 2601 ET SEQ.), the Federal
Insecticide, Fungicide and Rodenticide Act (7 U.S.C. Section 136 ET SEQ.), the
Occupational Safety and Health Act (29 U.S.C. Section 651 ET SEQ.), the Oil
Pollution Act (33 U.S.C. Section 2701 ET SEQ.) and the Emergency Planning and
Community Right-to-Know Act (42 U.S.C. Section 11001 ET SEQ.), each as amended
or supplemented, any analogous present or future state or local statutes or
laws, and any regulations promulgated pursuant to any of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor thereto.
"ERISA AFFILIATE" means, as applied to any Person, (i) any
corporation which is a member of a controlled group of corporations within the
meaning of Section 414(b) of the Internal Revenue Code of which that Person is a
member; (ii) any trade or business (whether or not incorporated) which is a
member of a group of trades or businesses under common control within the
meaning of Section 414(c) of the Internal Revenue Code of which that Person is a
member; and (iii) any member of an affiliated service group within the meaning
of Section 414(m) or (o) of the Internal Revenue Code of which that Person, any
corporation described in clause (i) above or any trade or business described in
clause (ii) above is a member. Any former ERISA Affiliate of Company or any of
its Subsidiaries shall continue to be considered an ERISA Affiliate of Company
or such Subsidiary within the meaning of this definition with respect to the
period such entity was an ERISA Affiliate of Company or such Subsidiary and with
respect to liabilities arising after such period for which Company or such
Subsidiary could be liable under the Internal Revenue Code or ERISA.
"ERISA EVENT" means (i) a "reportable event" within the
meaning of Section 4043 of ERISA and the regulations issued thereunder with
respect to any Pension Plan subject to Title IV of ERISA (excluding those for
which the provision for 30-day notice to the PBGC has been waived by
regulation); (ii) the failure to meet the minimum funding standard of Section
412 of the Internal Revenue Code with respect to any Pension Plan (whether or
not waived in accordance with Section 412(d) of the Internal Revenue Code) or
the failure to make by its due date a required installment under Section 412(m)
of the Internal Revenue Code with respect to any Pension Plan or the failure to
make any required contribution to a Multiemployer Plan; (iii) the provision by
the administrator of any Pension Plan pursuant to Section 4041(a)(2) of ERISA of
a notice of intent to terminate such plan in a distress termination described in
Section 4041(c) of ERISA; (iv) the withdrawal by Company, any of its
Subsidiaries or any of their respective ERISA Affiliates from any Pension Plan
with two or more contributing sponsors or the termination of any such Pension
Plan resulting in liability pursuant to Section 4063 or 4064 of ERISA; (v) the
institution by the PBGC of proceedings to terminate any Pension Plan, or the
occurrence of any event or condition that could reasonably be expected to
constitute grounds
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<PAGE> 21
under Section 4042 of ERISA for the involuntary termination of, or the
appointment of a trustee to administer, any Pension Plan; (vi) the imposition of
liability on Company, any of its Subsidiaries or any of their respective ERISA
Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of the
application of Section 4212(c) of ERISA; (vii) the withdrawal of Company, any of
its Subsidiaries or any of their respective ERISA Affiliates in a complete or
partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from
any Multiemployer Plan if there is any potential liability therefor, or the
receipt by Company, any of its Subsidiaries or any of their respective ERISA
Affiliates of notice from any Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the
occurrence of an act or omission which could give rise to the imposition on
Company or any of its Subsidiaries of fines, penalties, taxes or related charges
under Chapter 43 of the Internal Revenue Code or under Section 409, Section
502(c), (i) or (l), or Section 4071 of ERISA in respect of any Employee Benefit
Plan; (ix) the occurrence of an act or omission which could give rise to the
imposition on Company, any of its Subsidiaries or any of their respective ERISA
Affiliates of fines, penalties, taxes or related charges under Section 4071 of
ERISA in respect of any Employee Benefit Plan; (x) the assertion of a material
claim (other than routine claims for benefits) against any Employee Benefit Plan
other than a Multiemployer Plan or the assets thereof, or against Company, any
of its Subsidiaries or any of their respective ERISA Affiliates in connection
with any Employee Benefit Plan; (xi) receipt from the Internal Revenue Service
of notice of the failure of any Pension Plan (or any other Employee Benefit Plan
intended to be qualified under Section 401(a) of the Internal Revenue Code) to
qualify under Section 401(a) of the Internal Revenue Code, or the failure of any
trust forming part of any Pension Plan to qualify for exemption from taxation
under Section 501(a) of the Internal Revenue Code; or (xii) the imposition of a
Lien pursuant to Section 401(a)(29) or 412(n) of the Internal Revenue Code or
pursuant to ERISA with respect to any Pension Plan.
"EURODOLLAR RATE " means for any Eurodollar Rate Loan for any
Interest Period therefor, the rate per annum appearing on Telerate Page 3750 (or
any successor page) as the London interbank offered rate for deposits in
Dollars, at approximately 11:00 A.M. (London time) two Business Days prior to
the first day of such Interest period for a term comparable to such Interest
Period and for amounts comparable to the principal amount of the Eurodollar Rate
Loan of Administrative Agent for which the Eurodollar Rate is then being
determined (which principal amount shall be $1,000,000 in the event that
Administrative Agent is not making, converting to or continuing such a
Eurodollar Rate Loan). If for any reason such rate is not available, the term
"Eurodollar Rate" shall mean, for any Eurodollar Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/16th of 1%) appearing on Reuters Screen LIBO Page as the London interbank
offered rate for deposits in Dollars at approximately 11:00 A.M. (London time)
two Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period and for amounts comparable to the principal
amount of the Eurodollar Rate Loan of Administrative Agent for which the
Eurodollar Rate is then being determined (which principal amount shall be
$1,000,000 in the event that Administrative Agent is not making, converting to
or continuing such a Eurodollar Rate Loan); PROVIDED, HOWEVER, if more than one
rate is specified on Reuters Screen LIBO Page,
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the applicable rate shall be the arithmetic mean of all such rates.
"EURODOLLAR RATE LOANS" means Loans bearing interest at rates
determined by reference to the Adjusted Eurodollar Rate as provided in
subsection 2.2A.
"EVENT OF DEFAULT" means each of the events set forth in
Section 8.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute.
"EXISTING COMPANY INDEBTEDNESS" means all Indebtedness owed by
Company and its Subsidiaries on the Closing Date under the Agreement set forth
on SCHEDULE 1.1A hereto.
"FACILITIES" means any and all real property (including all
buildings, fixtures or other improvements located thereon) now, hereafter or
heretofore owned, leased, operated or used by Company or any of its Subsidiaries
or any of their respective predecessors or Affiliates.
"FEDERAL FUNDS EFFECTIVE RATE" means, for any period, a
fluctuating interest rate equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by Administrative Agent from three Federal funds
brokers of recognized standing selected by Administrative Agent.
"FINANCIAL PLAN" has the meaning assigned to that term in
subsection 6.1(xiii).
"FIRST PRIORITY" means, with respect to any Lien purported to
be created in any Collateral pursuant to any Collateral Document, that (i) such
Lien has priority over any other Lien on such Collateral (other than Permitted
Encumbrances) and (ii) such Lien is the only Lien (other than Liens permitted
pursuant to subsection 7.2) to which such Collateral is subject.
"FIRST UNION" has the meaning assigned to that term in the
introduction to this Agreement.
"FISCAL QUARTER" means a fiscal quarter of any Fiscal Year.
"FISCAL YEAR" means the fiscal year of Company and its
Subsidiaries ending on December 31 of each calendar year. For purposes of this
Agreement, any particular Fiscal Year shall be designated by reference to the
calendar year in which such Fiscal Year ends.
"FLOOD HAZARD PROPERTY" means a Mortgaged Property located in
an area designated by the Federal Emergency Management Agency as having special
flood or mud slide hazards.
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"FOREIGN SUBSIDIARY" means any Subsidiary that is not a
Domestic Subsidiary.
"FUNDING AND PAYMENT OFFICE" means (i) the office of
Administrative Agent and Swing Line Lender located at the address set forth
below or (ii) such other office of Administrative Agent and Swing Line Lender as
may from time to time hereafter be designated as such in a written notice
delivered by Administrative Agent and Swing Line Lender to Company and each
Lender:
First Union National Bank
One First Union Center, TW-4
Charlotte, North Carolina 28288-0608
Attn: Doug Burnett, Agency Services
Telecopier: (704) 383-0288
Telephone: (704) 374-2698
"FUNDING DATE" means the date of the funding of a Loan.
"GAAP" means, subject to the limitations on the application
thereof set forth in subsection 1.2, generally accepted accounting principles
set forth in 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 may be approved by a significant segment of
the accounting profession, in each case as the same are applicable to the
circumstances as of the date of determination.
"GOVERNMENTAL AUTHORIZATION" means any permit, license,
authorization, plan, directive, consent order or consent decree of or from any
federal, state or local governmental authority, agency or court.
"HAZARDOUS MATERIALS" means (i) any chemical, material or
substance at any time defined as or included in the definition of "hazardous
substances", "hazardous wastes", "hazardous materials", "extremely hazardous
waste", acutely hazardous waste", "radioactive waste", "biohazardous waste",
"pollutant", "toxic pollutant", "contaminant", "restricted hazardous waste",
"infectious waste", "toxic substances", or any other term or expression intended
to define, list or classify substances by reason of properties harmful to
health, safety or the indoor or outdoor environment (including harmful
properties such as ignitability, corrosivity, reactivity, carcinogenicity,
toxicity, reproductive toxicity, "TCLP toxicity" or "EP toxicity" or words of
similar import under any applicable Environmental Laws); (ii) any oil,
petroleum, petroleum fraction or petroleum derived substance; (iii) any drilling
fluids, produced waters and other wastes associated with the exploration,
development or production of crude oil, natural gas or geothermal resources;
(iv) any flammable substances or explosives; (v) any radioactive
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<PAGE> 24
materials; (vi) any asbestos-containing materials; (vii) urea formaldehyde foam
insulation; (viii) electrical equipment which contains any oil or dielectric
fluid containing polychlorinated biphenyls; (ix) pesticides; and (x) any other
chemical, material or substance, exposure to which is prohibited, limited or
regulated by any governmental authority or which may or could pose a hazard to
the health and safety of the owners, occupants or any Persons in the vicinity of
any Facility or to the indoor or outdoor environment.
"HAZARDOUS MATERIALS ACTIVITY" means any past, current,
proposed or threatened activity, event or occurrence involving any Hazardous
Materials, including the use, manufacture, possession, storage, holding,
presence, existence, location, Release, threatened Release, discharge,
placement, generation, transportation, processing, construction, treatment,
abatement, removal, remediation, disposal, disposition or handling of any
Hazardous Materials, and any corrective action or response action with respect
to any of the foregoing.
"HEDGE AGREEMENT" means an Interest Rate Agreement or a
Currency Agreement designed to hedge against fluctuations in interest rates or
currency values, respectively.
"INDEBTEDNESS", as applied to any Person, means (i) all
indebtedness for borrowed money, (ii) that portion of obligations with respect
to Capital Leases that is properly classified as a liability on a balance sheet
in conformity with GAAP, (iii) notes payable and drafts accepted representing
extensions of credit whether or not representing obligations for borrowed money,
(iv) any obligation owed for all or any part of the deferred purchase price of
property or services (excluding any such obligations incurred under ERISA),
which purchase price is (a) due more than six months from the date of incurrence
of the obligation in respect thereof or (b) evidenced by a note or similar
written instrument, and (v) all indebtedness secured by any Lien on any property
or asset owned or held by that Person regardless of whether the indebtedness
secured thereby shall have been assumed by that Person or is nonrecourse to the
credit of that Person. Obligations under Interest Rate Agreements and Currency
Agreements constitute (X) in the case of Hedge Agreements, Contingent
Obligations, and (Y) in all other cases, Investments, and in neither case
constitute Indebtedness.
"INDEMNITEE" has the meaning assigned to that term in
subsection 10.3.
"INTELLECTUAL PROPERTY" means all patents, trademarks,
tradenames, copyrights, technology, know-how and processes used in or necessary
for the conduct of the business of Company and its Subsidiaries as currently
conducted or as conducted hereafter that are material to the condition
(financial or otherwise), business or operations of Company and its
Subsidiaries, taken as a whole.
"INTEREST PAYMENT DATE" means (i) with respect to any Base
Rate Loan, the last Business Day of each March, June, September and December of
each year, commencing on the first such date to occur after the Closing Date,
and (ii) with respect to any Eurodollar Rate Loan, the last day of each Interest
Period applicable to such Loan; PROVIDED that in the case of each Interest
Period of longer than three months "Interest Payment Date" shall also include
each date
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that is three months, or an multiple thereof, after the commencement of such
Interest Period.
"INTEREST PERIOD" has the meaning assigned to that term in
subsection 2.2B.
"INTEREST RATE AGREEMENT" means any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement or other
similar agreement or arrangement to which Company or any of its Subsidiaries is
a party.
"INTEREST RATE DETERMINATION DATE" means, with respect to any
Interest Period, the second Business Day prior to the first day of such Interest
Period.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of
1986, as amended to the date hereof and from time to time hereafter, and any
successor statute.
"INVENTORY" means, with respect to any Person as of any date
of determination, all goods, merchandise and other personal property which are
then held by such Person for sale or lease, including raw materials and work in
process.
"INVESTMENT" means (i) any direct or indirect purchase or
other acquisition by Company or any of its Subsidiaries of, or of a beneficial
interest in, any Securities of any other Person (including any Subsidiary of
Company), (ii) any direct or indirect redemption, retirement, purchase or other
acquisition for value, by any Subsidiary of Company from any Person other than
Company or any of its Subsidiaries, of any equity Securities of such Subsidiary,
(iii) any direct or indirect loan, advance (other than advances to employees for
moving, entertainment and travel expenses, drawing accounts and similar
expenditures in the ordinary course of business) or capital contribution by
Company or any of its Subsidiaries to any other Person (other than a
wholly-owned Domestic Subsidiary of Company), including all indebtedness and
accounts receivable from that other Person that are not current assets or did
not arise from sales to that other Person in the ordinary course of business, or
(iv) Interest Rate Agreements or Currency Agreements not constituting Hedge
Agreements. The amount of any Investment shall be the original cost of such
Investment plus the cost of all additions thereto, without any adjustments for
increases or decreases in value, or write-ups, write-downs or write-offs with
respect to such Investment.
"IP COLLATERAL" means, collectively, the Collateral under the
Company Security Agreement and the Subsidiary Security Agreements consisting of
federally registered trademarks, trade names, service marks, copyrights, patents
or other similar types of property.
"ISSUING LENDER" means, with respect to any Letter of Credit,
the Lender that agrees or is otherwise obligated to issue such Letter of Credit,
determined as provided in subsection 3.1B(ii).
"JOINT VENTURE" means a joint venture, partnership or other
similar arrangement, whether in corporate, partnership or other legal form;
PROVIDED that in no event shall any corporate Subsidiary of any Person be
considered to be a Joint Venture to which such Person is a
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<PAGE> 26
party.
"LANDLORD CONSENT AND ESTOPPEL" means, with respect to any
Leasehold Property, a letter, certificate or other instrument in writing from
the lessor under the related lease, satisfactory in form and substance to
Agents, pursuant to which such lessor agrees, for the benefit Administrative of
Agent, (i) that without any further consent of such lessor or any further action
on the part of the Loan Party holding such Leasehold Property, such Leasehold
Property may be encumbered pursuant to a Mortgage and may be assigned to the
purchaser at a foreclosure sale or in a transfer in lieu of such a sale (and to
a subsequent third party assignee if any Agent, any Lender, or an Affiliate of
either so acquires such Leasehold Property), (ii) that such lessor shall not
terminate such lease as a result of a default by such Loan Party thereunder
without first giving Agents notice of such default and at least 60 days (or, if
such default cannot reasonably be cured by Agents within such period, such
longer period as may reasonably be required) to cure such default, (iii) to the
matters contained in a Collateral Access Agreement, and (iv) to such other
matters relating to such Leasehold Property as any Agent may reasonably request.
"LEASEHOLD PROPERTY" means any leasehold interest of any Loan
Party as lessee under any lease of real property , other than any such leasehold
interest designated from time to time by Administrative Agent in its sole
discretion as not being required to be included in the Collateral.
"LENDER" and "LENDERS" means the persons identified as
"Lenders" and listed on the signature pages of this Agreement, together with
their successors and permitted assigns pursuant to subsection 10.1, and the term
"Lenders" shall include Swing Line Lender unless the context otherwise requires.
"LETTER OF CREDIT" or "LETTERS OF CREDIT" means Commercial
Letters of Credit and Standby Letters of Credit issued or to be issued by
Issuing Lenders for the account of Company pursuant to subsection 3.1.
"LETTER OF CREDIT USAGE" means, as at any date of
determination, the sum of (i) the maximum aggregate amount which is or at any
time thereafter may become available for drawing under all Letters of Credit
then outstanding PLUS (ii) the aggregate amount of all drawings under Letters of
Credit honored by Issuing Lenders and not theretofore reimbursed by Company
(including any such reimbursement out of the proceeds of Revolving Loans
pursuant to subsection 3.3B).
"LIEN" means any lien, mortgage, pledge, assignment, security
interest, charge or encumbrance of any kind (including any conditional sale or
other title retention agreement, any lease in the nature thereof, and any
agreement to give any security interest) and any option, trust or other
preferential arrangement having the practical effect of any of the foregoing.
"LOAN" or "LOANS" means one or more of the Tranche A Term
Loans, Tranche B Term Loans, Revolving Loans or Swing Line Loans or any
combination thereof.
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"LOAN DOCUMENTS" means this Agreement, the Notes, the Letters
of Credit (and any applications for, or reimbursement agreements or other
documents or certificates executed by Company in favor of an Issuing Lender
relating to, the Letters of Credit), the Subsidiary Guaranty and the Collateral
Documents.
"LOAN PARTY" means each of Company and any of Company's
Subsidiaries from time to time executing a Loan Document, and "LOAN PARTIES"
means all such Persons, collectively.
"MARGIN DETERMINATION CERTIFICATE" means an Officers'
Certificate of Company delivered pursuant to 6.1(iv) setting forth in reasonable
detail the Consolidated Leverage Ratio for the Fiscal Quarter ending on the last
day of the accounting period covered by the financial statements delivered with
such Officers' Certificate.
"MARGIN STOCK" has the meaning assigned to that term in
Regulation U of the Board of Governors of the Federal Reserve System as in
effect from time to time.
"MATERIAL ADVERSE EFFECT" means a material adverse effect upon
(i) the business, operations, properties (including intangible properties),
assets, condition (financial or otherwise) or prospects, liabilities or
regulatory status of Company and its Subsidiaries, taken as a whole, or of
Target and its Subsidiaries, taken as a whole or (ii) the ability of any Loan
Party to perform, or of Agents or Lenders to enforce, the Obligations.
"MATERIAL LEASEHOLD PROPERTY" means a Leasehold Property
reasonably determined by Agents to be of material value as Collateral or of
material importance to the operations of Company or any of its Subsidiaries;
PROVIDED, however that no Leasehold Property with respect to which the aggregate
amount of all rents payable during any one Fiscal Year never exceeds $1,000,000
shall be a "Material Leasehold Property".
"MERGER" means the merger of Merger Sub with and into Target
in accordance with the terms of the Merger Agreement, with Target being the
surviving corporation in such Merger.
"MERGER AGREEMENT" means that certain Agreement and Plan of
Merger by and among Company, Target, Merger Sub, and Alan M. Meckler dated as of
October 7, 1998, in the form delivered to Agent and Lenders prior to their
execution of this Agreement and as such agreement may be amended from time to
time thereafter to the extent permitted under subsection 7.15A.
"MERGER DATE" means the date upon which the Merger is
consummated.
"MERGER SUB" means Internet World Media, Inc., a Delaware
corporation existing prior to the Merger.
"MINIMUM SHARES" means, at the date of determination, a
majority of the total number of shares of Target Common Stock outstanding on a
fully diluted basis but not less than a
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sufficient number of such shares to permit Merger Sub acting alone to cause the
Merger to be approved by the stockholders of Target.
"MORTGAGE" means (i) a security instrument (whether designated
as a deed of trust or a mortgage or by any similar title) executed and delivered
by any Loan Party, substantially in the form of EXHIBIT XX annexed hereto or in
such other form as may be approved by Agents in their sole discretion, in each
case with such changes thereto as may be recommended by Administrative Agent's
local counsel based on local laws or customary local mortgage or deed of trust
practices, or (ii) at the option of Agents, in the case of an Additional
Mortgaged Property (as defined in subsection 6.9), an amendment to an existing
Mortgage, in form satisfactory to Agents, adding such Additional Mortgaged
Property to the Real Property Assets encumbered by such existing Mortgage, in
either case as such security instrument or amendment may be amended,
supplemented or otherwise modified from time to time. "MORTGAGES" means all such
instruments, including the Closing Date Mortgages and any Additional Mortgages,
collectively.
"MORTGAGED PROPERTY" means a Closing Date Mortgaged Property
or an Additional Mortgaged Property.
"MULTIEMPLOYER PLAN" means any Employee Benefit Plan subject
to Title IV of ERISA which is a "multiemployer plan" as defined in Section 3(37)
of ERISA.
"NET ASSET SALE PROCEEDS" means, with respect to any Asset
Sale, Cash payments (including any Cash received by way of deferred payment
pursuant to, or by monetization of, a note receivable or otherwise, but only as
and when so received) received from such Asset Sale, net of any bona fide direct
costs incurred in connection with such Asset Sale, including (i) income taxes
reasonably estimated to be actually payable within two years of the date of such
Asset Sale as a result of any gain recognized in connection with such Asset Sale
and (ii) payment of the outstanding principal amount of, premium or penalty, if
any, and interest on any Indebtedness (other than the Loans) that is secured by
a Lien on the stock or assets in question and that is required to be repaid
under the terms thereof as a result of such Asset Sale.
"NET INSURANCE/CONDEMNATION PROCEEDS" means any Cash payments
or proceeds received by Company or any of its Subsidiaries (i) under any
business interruption or casualty insurance policy in respect of a covered loss
thereunder or (ii) as a result of the taking of any assets of Company or any of
its Subsidiaries by any Person pursuant to the power of eminent domain,
condemnation or otherwise, or pursuant to a sale of any such assets to a
purchaser with such power under threat of such a taking, in each case net of any
actual and reasonable documented costs incurred by Company or any of its
Subsidiaries in connection with the adjustment or settlement of any claims of
Company or such Subsidiary in respect thereof.
"NOTES" means one or more of the Tranche A Term Notes, Tranche
B Term Notes, Revolving Notes or Swing Line Note or any combination thereof.
"NOTICE OF ACCOUNT DESIGNATION" means a notice substantially
in the form of EXHIBIT XXI annexed hereto delivered by Company to Administrative
Agent pursuant to
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subsection 2.1C or 4.1Q with respect to a proposed designation of an account of
Company to receive proceeds of Loans.
"NOTICE OF BORROWING" means a notice substantially in the form
of EXHIBIT I annexed hereto delivered by Company to Administrative Agent
pursuant to subsection 2.1B with respect to a proposed borrowing.
"NOTICE OF CONVERSION/CONTINUATION" means a notice
substantially in the form of EXHIBIT II annexed hereto delivered by Company to
Administrative Agent pursuant to subsection 2.2D with respect to a proposed
conversion or continuation of the applicable basis for determining the interest
rate with respect to the Loans specified therein.
"NOTICE OF ISSUANCE OF LETTER OF CREDIT" means a notice
substantially in the form of EXHIBIT III annexed hereto delivered by Company to
Administrative Agent pursuant to subsection 3.1B(i) with respect to the proposed
issuance of a Letter of Credit.
"OBLIGATIONS" means all obligations of every nature of each
Loan Party from time to time owed to Agents, Lenders or any of them under the
Loan Documents, whether for principal, interest, reimbursement of amounts drawn
under Letters of Credit, fees, expenses, indemnification or otherwise.
"OFFICERS' CERTIFICATE" means, as applied to any corporation,
a certificate executed on behalf of such corporation by its chairman of the
board (if an officer) or its president or one of its vice presidents and by its
chief financial officer or its treasurer; PROVIDED that every Officers'
Certificate with respect to the compliance with a condition precedent to the
making of any Loans hereunder shall include (i) a statement that the officer or
officers making or giving such Officers' Certificate have read such condition
and any definitions or other provisions contained in this Agreement relating
thereto, (ii) a statement that, in the opinion of the signers, they have made or
have caused to be made such examination or investigation as is necessary to
enable them to express an informed opinion as to whether or not such condition
has been complied with, and (iii) a statement as to whether, in the opinion of
the signers, such condition has been complied with.
"OPERATING LEASE" means, as applied to any Person, any lease
(including leases that may be terminated by the lessee at any time) of any
property (whether real, personal or mixed) that is not a Capital Lease other
than any such lease under which that Person is the lessor.
"OTHER TARGET SHARES" has the meaning assigned to that term in
the Recitals to this Agreement.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"PENSION PLAN" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to Section 412 of the Internal Revenue Code
or Section 302 of ERISA.
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"PERMITTED ACQUISITION" has the meaning assigned thereto in
subsection 7.7(vi).
"PERMITTED ENCUMBRANCES" means the following types of Liens
(excluding any such Lien imposed pursuant to Section 401(a)(29) or 412(n) of the
Internal Revenue Code or by ERISA and any such Lien relating to or imposed in
connection with any Environmental Claim):
(i) Liens for taxes, assessments or governmental charges or
claims the payment of which is not, at the time, required by subsection
6.3;
(ii) statutory Liens of landlords, statutory Liens of banks
and rights of set-off, statutory Liens of carriers, warehousemen,
mechanics, repairmen, workmen and materialmen, and other Liens imposed
by law, in each case incurred in the ordinary course of business (a)
for amounts not yet overdue or (b) for amounts that are overdue and
that (in the case of any such amounts overdue for a period in excess of
5 days) are being contested in good faith by appropriate proceedings,
so long as (1) such reserves or other appropriate provisions, if any,
as shall be required by GAAP shall have been made for any such
contested amounts, and (2) in the case of a Lien with respect to any
portion of the Collateral, such contest proceedings conclusively
operate to stay the sale of any portion of the Collateral on account of
such Lien;
(iii) Liens incurred or deposits made in the ordinary course
of business in connection with workers' compensation, unemployment
insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, surety and appeal bonds,
bids, leases, government contracts, trade contracts, performance and
return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money), so long as no
foreclosure, sale or similar proceedings have been commenced with
respect to any portion of the Collateral on account thereof;
(iv) any attachment or judgment Lien not constituting an Event
of Default under subsection 8.8;
(v) leases or subleases granted to third parties in accordance
with any applicable terms of the Collateral Documents and not
interfering in any material respect with the ordinary conduct of the
business of Company or any of its Subsidiaries or resulting in a
material diminution in the value of any Collateral as security for the
Obligations;
(vi) easements, rights-of-way, restrictions, encroachments,
and other minor defects or irregularities in title, in each case which
do not and will not interfere in any material respect with the ordinary
conduct of the business of Company or any of its Subsidiaries or result
in a material diminution in the value of any Collateral as security for
the Obligations;
(vii) any (a) interest or title of a lessor or sublessor under
any lease, (b) restriction or encumbrance that the interest or title of
such lessor or sublessor may be
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<PAGE> 31
subject to, or (c) subordination of the interest of the lessee or
sublessee under such lease to any restriction or encumbrance referred
to in the preceding clause (b), so long as the holder of such
restriction or encumbrance agrees to recognize the rights of such
lessee or sublessee under such lease;
(viii) Liens arising from filing UCC financing statements
relating solely to leases permitted by this Agreement;
(ix) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of customs duties in connection
with the importation of goods;
(x) any zoning or similar law or right reserved to or vested
in any governmental office or agency to control or regulate the use of
any real property;
(xi) Liens securing obligations (other than obligations
representing Indebtedness for borrowed money) under operating,
reciprocal easement or similar agreements entered into in the ordinary
course of business of Company and its Subsidiaries; and
(xii) licenses of patents, trademarks and other intellectual
property rights granted by Company or any of its Subsidiaries in the
ordinary course of business and not interfering in any material respect
with the ordinary conduct of the business of Company or such
Subsidiary.
"PERSON" means and includes natural persons, corporations,
limited partnerships, general partnerships, limited liability companies, limited
liability partnerships, joint stock companies, Joint Ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and governments (whether federal,
state or local, domestic or foreign, and including political subdivisions
thereof) and agencies or other administrative or regulatory bodies thereof.
"PLEDGED COLLATERAL" means, collectively, the "Pledged
Collateral" as defined in the Company Pledge Agreement and the Subsidiary Pledge
Agreements.
"POTENTIAL EVENT OF DEFAULT" means a condition or event that,
after notice or lapse of time or both, would constitute an Event of Default.
"PRIME RATE" means the rate that Administrative Agent
announces from time to time as its prime lending rate, as in effect from time to
time. The Prime Rate is a reference rate and does not necessarily represent the
lowest or best rate actually charged to any customer. Administrative Agent or
any other Lender may make commercial loans or other loans at rates of interest
at, above or below the Prime Rate.
"PRO FORMA FINANCIAL COVENANT COMPLIANCE" means, as of any
date of determination, the compliance of Company with the financial covenants
set forth in subsection 7.6 as of the last day of the four Fiscal Quarter period
most recently ended prior to such date of
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determination for which the relevant financial information is available (the
"COMPLIANCE PERIOD"), after giving effect on a PRO FORMA BASIS to any Permitted
Acquisitions made during such Compliance Period and any dispositions made during
such Compliance Period, other than sales of inventory in the ordinary course of
business and dispositions of obsolete equipment. The pro forma calculations of
the financial covenants set forth in subsection 7.6 shall give effect to such
Permitted Acquisitions and dispositions on the following basis:
(i) any Indebtedness incurred or assumed by Company
or any of its Subsidiaries in connection with such Permitted
Acquisitions and any Indebtedness repaid in connection with such
Permitted Acquisitions or dispositions shall be deemed to have been
incurred or repaid, respectively, as of the first day of the Compliance
Period;
(ii) if such Indebtedness incurred or assumed by
Company or any of its Subsidiaries in connection with such Permitted
Acquisitions has a floating or formula rate, then the rate of interest
for such Indebtedness for the applicable period shall be computed as if
the rate in effect for such Indebtedness on the relevant measurement
date had been the applicable rate for the entire applicable period; and
(iii) income statement items (whether positive or
negative) attributable to the property or business acquired or disposed
of in such Permitted Acquisitions or dispositions shall be included as
if such acquisitions or dispositions took place on the first day of
such Compliance Period on a PRO FORMA BASIS.
With respect to any such Permitted Acquisitions, such pro
forma calculations shall be based on the audited or reviewed financial results
delivered in compliance with clause (f)(3) of subsection 7.7(vi).
"PRO RATA SHARE" means (i) with respect to all payments,
computations and other matters relating to the Tranche A Term Loan Commitment or
the Tranche A Term Loan of any Lender, the percentage obtained by DIVIDING (x)
the Tranche A Term Loan Exposure of that Lender BY (y) the aggregate Tranche A
Term Loan Exposure of all Lenders, (ii) with respect to all payments,
computations and other matters relating to the Tranche B Term Loan Commitment or
the Tranche B Term Loan of any Lender, the percentage obtained by DIVIDING (x)
the Tranche B Term Loan Exposure of that Lender BY (y) the aggregate Tranche B
Term Loan Exposure of all Lenders, (iii) with respect to all payments,
computations and other matters relating to the Revolving Loan Commitment or the
Revolving Loans of any Lender or any Letters of Credit issued or participations
therein purchased by any Lender or any participations in any Swing Line Loans
purchased by any Lender, the percentage obtained by DIVIDING (x) the Revolving
Loan Exposure of that Lender BY (y) the aggregate Revolving Loan Exposure of all
Lenders, and (iv) for all other purposes with respect to each Lender, the
percentage obtained by DIVIDING (x) the sum of the Tranche A Term Loan Exposure
of that Lender PLUS the Tranche B Term Loan Exposure of that Lender PLUS the
Revolving Loan Exposure of that Lender BY (y) the sum of the aggregate Tranche A
Term Loan Exposure of all Lenders PLUS the aggregate Tranche B Term Loan
Exposure of all Lenders PLUS the aggregate Revolving Loan Exposure of all
Lenders, in any such case as the applicable percentage may be adjusted as a
result of prepayments made pursuant
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to subsection 2.4 or by assignments permitted pursuant to subsection 10.1. The
initial Pro Rata Share of each Lender for purposes of each of clauses (i), (ii),
(iii) and (iv) of the preceding sentence is set forth opposite the name of that
Lender in SCHEDULE 2.1 annexed hereto.
"PTO" means the United States Patent and Trademark Office or
any successor or substitute office in which filings are necessary or, in the
opinion of Administrative Agent, desirable in order to create or perfect Liens
on any IP Collateral.
"REAL PROPERTY ASSET" means, at any time of determination, any
interest then owned by any Loan Party in any real property.
"RECORDED LEASEHOLD INTEREST" means a Leasehold Property with
respect to which a Record Document (as hereinafter defined) has been recorded in
all places necessary or desirable, in the reasonable judgment of Agents, to give
constructive notice of such Leasehold Property to third-party purchasers and
encumbrancers of the affected real property. For purposes of this definition,
the term "RECORD DOCUMENT" means, with respect to any Leasehold Property, (a)
the lease evidencing such Leasehold Property or a memorandum thereof, executed
and acknowledged by the owner of the affected real property, as lessor, or (b)
if such Leasehold Property was acquired or subleased from the holder of a
Recorded Leasehold Interest, the applicable assignment or sublease document,
executed and acknowledged by such holder, in each case in form sufficient to
give such constructive notice upon recordation and otherwise in form reasonably
satisfactory to Agents.
"REFUNDED SWING LINE LOANS" has the meaning assigned to that
term in subsection 2.1A(iv).
"REGULATION D" means Regulation D of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"REIMBURSEMENT DATE" has the meaning assigned to that term in
subsection 3.3B.
"REINVESTMENT PERIOD" means, with respect to any Net Asset
Sale Proceeds received in respect of any Asset Sale, the period commencing on
the date such Net Asset Sale Proceeds are received by Company or any of its
Subsidiaries and ending on the earlier of (x) the second Business Day following
any determination by a Responsible Officer of Company or any of its Subsidiaries
that such Net Asset Sale Proceeds will not be reinvested in a Related Business
within 180 days of receipt thereof by Company or its Subsidiaries and (y) the
date that is 180 days after receipt of such Net Asset Sale Proceeds by Company
or any of its Subsidiaries; PROVIDED, that if any Event of Default or Potential
Event of Default shall have occurred and be continuing when any Net Asset Sale
Proceeds are received by Company or any of its Subsidiaries, the Reinvestment
Period for such Net Asset Sale Proceeds shall be deemed to have terminated upon
receipt thereof.
"RELATED AGREEMENTS" means, collectively, the Merger Agreement
and the
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Tender, Voting and Option Agreement.
"RELATED BUSINESS" means the business of publishing trade
magazines, operating trade shows and conferences, providing electronically
distributed subscription information services, disseminating market research and
data service, and marketing programs to business suppliers, as conducted by
Company and its Subsidiaries on the Closing Date, and any and all reasonably
related businesses necessary for, in support or anticipation of, and ancillary
to such businesses.
"RELEASE" means any release, spill, emission, leaking,
pumping, pouring, injection, escaping, deposit, disposal, discharge, dispersal,
dumping, leaching or migration of Hazardous Materials into the indoor or outdoor
environment (including the abandonment or disposal of any barrels, containers or
other closed receptacles containing any Hazardous Materials), including the
movement of any Hazardous Materials through the air, soil, surface water or
groundwater.
"REQUISITE CLASS LENDERS" means, at any time of determination
(i) for the Class of Lenders having Revolving Loan Exposure, Lenders having or
holding more than 50% of the aggregate Revolving Loan Exposure of all Lenders,
(ii) for the Class of Lenders having Tranche A Term Loan Exposure, Lenders
having or holding more than 50% of the aggregate Tranche A Term Loan Exposure of
all Lenders, and (iii) for the Class of Lenders having Tranche B Term Loan
Exposure, Lenders having or holding more than 50% of the aggregate Tranche B
Term Loan Exposure of all Lenders.
"REQUISITE LENDERS" means Lenders having or holding more than
50% of the sum of (i) the aggregate Tranche A Term Loan Exposure of all Lenders
PLUS (ii) the aggregate Tranche B Term Loan Exposure of all Lenders PLUS (iii)
the aggregate Revolving Loan Exposure of all Lenders.
"RESTRICTED JUNIOR PAYMENT" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class of stock
of Company now or hereafter outstanding, except a dividend payable solely in
shares of that class of stock to the holders of that class, (ii) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of any class of stock of Company now or
hereafter outstanding and (iii) any payment made to retire, or to obtain the
surrender of, any outstanding warrants, options or other rights to acquire
shares of any class of stock of Company now or hereafter outstanding.
"REVOLVING LOAN COMMITMENT" means the commitment of a Lender
to make Revolving Loans to Company pursuant to subsection 2.1A(iii), and
"REVOLVING LOAN COMMITMENTS" means such commitments of all Lenders in the
aggregate.
"REVOLVING LOAN COMMITMENT TERMINATION DATE" means May 31,
2005.
"REVOLVING LOAN EXPOSURE" means, with respect to any Lender as
of any date of determination (i) prior to the termination of the Revolving Loan
Commitments, that Lender's
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Revolving Loan Commitment and (ii) after the termination of the Revolving Loan
Commitments, the sum of (a) the aggregate outstanding principal amount of the
Revolving Loans of that Lender PLUS (b) in the event that Lender is an Issuing
Lender, the aggregate Letter of Credit Usage in respect of all Letters of Credit
issued by that Lender (in each case net of any participations purchased by other
Lenders in such Letters of Credit or any unreimbursed drawings thereunder) PLUS
(c) the aggregate amount of all participations purchased by that Lender in any
outstanding Letters of Credit or any unreimbursed drawings under any Letters of
Credit PLUS (d) in the case of Swing Line Lender, the aggregate outstanding
principal amount of all Swing Line Loans (net of any participations therein
purchased by other Lenders) PLUS (e) the aggregate amount of all participations
purchased by that Lender in any outstanding Swing Line Loans.
"REVOLVING LOAN LENDER" means a Lender having a Revolving Loan
Commitment.
"REVOLVING LOANS" means the Loans made by Lenders to Company
pursuant to subsection 2.1A(iii).
"REVOLVING NOTES" means (i) the promissory notes of Company
issued pursuant to subsection 2.1E(iii) on the Closing Date and (ii) any
promissory notes issued by Company pursuant to the last sentence of subsection
10.1B(i) in connection with assignments of the Revolving Loan Commitments and
Revolving Loans of any Lenders, in each case substantially in the form of
EXHIBIT VI annexed hereto, as they may be amended, supplemented or otherwise
modified from time to time.
"SECOND TRANCHE A DRAW DATE" means a date selected by Company
that is after the Closing Date and on or before the Tranche A Term Loan
Commitment Termination Date on which the second borrowing of Tranche A Term
Loans is requested to be made.
"SECURITIES" means any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities" or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"SECURITIES ACT" means the Securities Act of 1933, as amended
from time to time, and any successor statute.
"SOLVENT" means, with respect to any Person, that as of the
date of determination both (A) (i) the then fair saleable value of the property
of such Person is (y) greater than the total amount of liabilities (including
contingent liabilities) of such Person and (z) not less than the amount that
will be required to pay the probable liabilities on such Person's then existing
debts as they become absolute and matured considering all financing alternatives
and potential asset sales reasonably available to such Person; (ii) such
Person's capital is not unreasonably small in relation
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<PAGE> 36
to its business or any contemplated or undertaken transaction; and (iii) such
Person does not intend to incur, or believe (nor should it reasonably believe)
that it will incur, debts beyond its ability to pay such debts as they become
due; and (B) such Person is "solvent" within the meaning given that term and
similar terms under applicable laws relating to fraudulent transfers and
conveyances. For purposes of this definition, the amount of any contingent
liability at any time shall be computed as the amount that, in light of all of
the facts and circumstances existing at such time, represents the amount that
can reasonably be expected to become an actual or matured liability.
"STANDBY LETTER OF CREDIT" means any standby letter of credit
or similar instrument issued for the purpose of supporting (i) Indebtedness of
Company or any of its Subsidiaries in respect of industrial revenue or
development bonds or financings, (ii) workers' compensation liabilities of
Company or any of its Subsidiaries, (iii) the obligations of third party
insurers of Company or any of its Subsidiaries arising by virtue of the laws of
any jurisdiction requiring third party insurers, (iv) obligations with respect
to Capital Leases or Operating Leases of Company or any of its Subsidiaries, and
(v) performance, payment, deposit or surety obligations of Company or any of its
Subsidiaries, in any case if required by law or governmental rule or regulation
or in accordance with custom and practice in the industry; PROVIDED that Standby
Letters of Credit may not be issued for the purpose of supporting (a) trade
payables or (b) any Indebtedness constituting "antecedent debt" (as that term is
used in Section 547 of the Bankruptcy Code).
"SUBSIDIARY" means, with respect to any Person, any
corporation, partnership, limited liability company, association, joint venture
or other business entity of which more than 50% of the total voting power of
shares of stock or other ownership interests entitled (without regard to the
occurrence of any contingency) to vote in the election of the Person or Persons
(whether directors, managers, trustees or other Persons performing similar
functions) having the power to direct or cause the direction of the management
and policies thereof is at the time owned or controlled, directly or indirectly,
by that Person or one or more of the other Subsidiaries of that Person or a
combination thereof. Except as otherwise specified herein, Target shall be
deemed to be a Subsidiary of Company from and after the Closing Date.
"SUBSIDIARY GUARANTOR" means any Subsidiary of Company that
executes and delivers a counterpart of the Subsidiary Guaranty on the Closing
Date or from time to time thereafter pursuant to subsection 6.8.
"SUBSIDIARY GUARANTY" means the Subsidiary Guaranty executed
and delivered by the Domestic Subsidiaries of Company existing on the Closing
Date and to be executed and delivered by additional Domestic Subsidiaries of
Company from time to time thereafter in accordance with subsection 6.8,
substantially in the form of EXHIBIT XVII annexed hereto, as such Subsidiary
Guaranty may hereafter be amended, supplemented or otherwise modified from time
to time.
"SUBSIDIARY PLEDGE AGREEMENT" means each Subsidiary Pledge
Agreement executed and
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delivered by an existing Subsidiary Guarantor on the Closing Date or executed
and delivered by any additional Subsidiary Guarantor from time to time
thereafter in accordance with subsection 6.8, in each case substantially in the
form of EXHIBIT XVIII annexed hereto, as such Subsidiary Pledge Agreement may be
amended, supplemented or otherwise modified from time to time, and "SUBSIDIARY
PLEDGE AGREEMENTS" means all such Subsidiary Pledge Agreements, collectively.
"SUBSIDIARY SECURITY AGREEMENT" means each Subsidiary Security
Agreement executed and delivered by an existing Subsidiary Guarantor on the
Closing Date or executed and delivered by any additional Subsidiary Guarantor
from time to time thereafter in accordance with subsection 6.8, in each case
substantially in the form of EXHIBIT XIX annexed hereto, as such Subsidiary
Security Agreement may be amended, supplemented or otherwise modified from time
to time, and "SUBSIDIARY SECURITY AGREEMENTS" means all such Subsidiary Security
Agreements, collectively.
"SUPPLEMENTAL COLLATERAL AGENT" has the meaning assigned to
that term in subsection 9.1B.
"SURVIVING CORPORATION" has the meaning assigned to that term
in the Recitals to this Agreement.
"SWING LINE LENDER" means First Union , or any Person serving
as a successor Administrative Agent hereunder, in its capacity as Swing Line
Lender hereunder.
"SWING LINE LOAN COMMITMENT" means the commitment of Swing
Line Lender to make Swing Line Loans to Company pursuant to subsection 2.1A(iv).
"SWING LINE LOANS" means the Loans made by Swing Line Lender
to Company pursuant to subsection 2.1A(iv).
"SWING LINE NOTE" means (i) the promissory note of Company
issued pursuant to subsection 2.1E(iv) on the Closing Date and (ii) any
promissory note issued by Company to any successor Administrative Agent and
Swing Line Lender pursuant to the last sentence of subsection 9.5B, in each case
substantially in the form of EXHIBIT VII annexed hereto, as it may be amended,
supplemented or otherwise modified from time to time.
"SYNDICATION AGENT" has the meaning assigned to that term in
the introduction to this Agreement.
"TARGET" means Mecklermedia Corporation, a Delaware
corporation.
"TARGET COMMON STOCK" has the meaning assigned to that term in
the Recitals to this Agreement.
"TARGET STOCK OPTIONS" has the meaning assigned to that term
in the Recitals to this Agreement.
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"TAX" or "TAXES" means any present or future tax, levy,
impost, duty, charge, fee, deduction or withholding of any nature and whatever
called, by whomsoever, on whomsoever and wherever imposed, levied, collected,
withheld or assessed; PROVIDED that "TAX ON THE OVERALL NET INCOME" of a Person
shall be construed as a reference to a tax imposed by the jurisdiction in which
that Person is organized or in which that Person's principal office (and/or, in
the case of a Lender, its lending office) is located or in which that Person
(and/or, in the case of a Lender, its lending office) is deemed to be doing
business on all or part of the net income, profits or gains (whether worldwide,
or only insofar as such income, profits or gains are considered to arise in or
to relate to a particular jurisdiction, or otherwise) of that Person (and/or, in
the case of a Lender, its lending office).
"TENDER OFFER" means the offer by Merger Sub to purchase for
$29.00 per share in cash all of the outstanding shares of Target Common Stock
pursuant to the Tender Offer Materials.
"TENDER OFFER MATERIALS" means the Tender Offer Statement on
Schedule 14D-1 filed by Company and Merger Sub on October 15, 1998 with the
Securities and Exchange Commission pursuant to Section 14(d)(1) of the Exchange
Act, together with all exhibits, supplements and amendments thereto and any
other amendments prior to the date hereof that relate only to any extension of
time during which the offer to purchase remains outstanding and other amendments
that are approved by Requisite Lenders.
"TENDER, VOTING AND OPTION AGREEMENT" means that certain
Tender, Voting and Option Agreement dated as of October 7, 1998, by and among
Company, Merger Sub, Target and Alan M. Meckler, pursuant to which Alan M.
Meckler has granted an option to Merger Sub to purchase his shares of Target
Common Stock, which constitute approximately 26% of the outstanding Target
Common Stock on a fully diluted basis, at $29.00 per share, and has agreed to
tender such shares pursuant to the Tender Offer.
"TENDERED TARGET SHARES" means all shares of Target Common
Stock tendered to and purchased by Merger Sub pursuant to the Tender Offer and
the Tender, Voting and Option Agreement.
"TERM LOANS" means, collectively, the Tranche A Term Loans and
the Tranche B Term Loans.
"TITLE COMPANY" means, collectively, Commonwealth Land Title
Company and/or one or more other title insurance companies reasonably
satisfactory to Agents.
"TOTAL UTILIZATION OF REVOLVING LOAN COMMITMENTS" means, as at
any date of determination, the sum of (i) the aggregate principal amount of all
outstanding Revolving Loans (other than Revolving Loans made for the purpose of
repaying any Refunded Swing Line Loans or reimbursing the applicable Issuing
Lender for any amount drawn under any Letter of Credit but not yet so applied)
PLUS (ii) the aggregate principal amount of all outstanding Swing Line Loans
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PLUS (iii) the Letter of Credit Usage.
"TRANCHE A TERM LOAN COMMITMENT" means the commitment of a
Lender to make Tranche A Term Loans to Company pursuant to subsection 2.1A(i),
and "TRANCHE A TERM LOAN COMMITMENTS" means such commitments of all Lenders in
the aggregate.
"TRANCHE A TERM LOAN COMMITMENT TERMINATION DATE" means the
earlier of (x) the Merger Date and (y) the date that is 90 days after the
Closing Date.
"TRANCHE A TERM LOAN EXPOSURE" means, with respect to any
Lender as of any date of determination (i) prior to the Tranche A Term Loan
Commitment Termination Date, that Lender's Tranche A Term Loan Commitment and
(ii) after the Tranche A Term Loan Commitment Termination Date, the outstanding
principal amount of the Tranche A Term Loan of that Lender.
"TRANCHE A TERM LOAN LENDER" means any Lender who holds a
Tranche A Term Loan Commitment or who has made a Tranche A Term Loan hereunder
and any assignee of such Lender pursuant to subsection 10.1B.
"TRANCHE A TERM LOANS" means the Loans made by Lenders to
Company pursuant to subsection 2.1A(i).
"TRANCHE A TERM NOTES" means (i) the promissory notes of
Company issued pursuant to subsection 2.1E(i) on the Closing Date and (ii) any
promissory notes issued by Company pursuant to the last sentence of subsection
10.1B(i) in connection with assignments of the Tranche A Term Loan Commitments
or Tranche A Term Loans of any Lenders, in each case substantially in the form
of EXHIBIT IV annexed hereto, as they may be amended, supplemented or otherwise
modified from time to time.
"TRANCHE B TERM LOAN COMMITMENT" means the commitment of a
Lender to make a Tranche B Term Loan to Company pursuant to subsection 2.1A(ii),
and "TRANCHE B TERM LOAN COMMITMENTS" means such commitments of all Lenders in
the aggregate.
"TRANCHE B TERM LOAN EXPOSURE" means, with respect to any
Lender as of any date of determination (i) prior to the funding of the Tranche B
Term Loans, that Lender's Tranche B Term Loan Commitment and (ii) after the
funding of the Tranche B Term Loans, the outstanding principal amount of the
Tranche B Term Loan of that Lender.
"TRANCHE B TERM LOAN LENDER" means any Lender who holds a
Tranche B Term Loan Commitment or who has made a Tranche B Term Loan hereunder
and any assignee of such Lender pursuant to subsection 10.1B.
"TRANCHE B TERM LOANS" means the Loans made by Lenders to
Company pursuant to subsection 2.1A(ii).
"TRANCHE B TERM NOTES" means (i) the promissory notes of
Company issued
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pursuant to subsection 2.1E(ii) on the Closing Date and (ii) any promissory
notes issued by Company pursuant to the last sentence of subsection 10.1B(i) in
connection with assignments of the Tranche B Term Loan Commitments or Tranche B
Term Loans of any Lenders, in each case substantially in the form of EXHIBIT V
annexed hereto, as they may be amended, supplemented or otherwise modified from
time to time.
"TRANSACTION COSTS" means the fees, costs and expenses payable
by any Loan Party on or before the Merger Date in connection with the Tender
Offer, the Merger, the related financings and the other transactions
contemplated hereby.
"UCC" means the Uniform Commercial Code (or any similar or
equivalent legislation) as in effect in any applicable jurisdiction.
"UNAPPLIED NET ASSET SALE PROCEEDS" means, as of any date of
determination, all Net Asset Sale Proceeds received by Company or any of its
Subsidiaries during the period from the Closing Date to such date of
determination EXCLUDING (i) all such Net Asset Sale Proceeds that have been
applied to mandatory prepayments of the Loans and/or reductions of the
Commitments pursuant to subsection 2.4B(iii) and (ii) Net Asset Sale Proceeds
that, when received by Company or any of its Subsidiaries, were intended by
Company or any of its Subsidiaries to be reinvested in a Related Business within
180 days of such receipt, and either (x) such Net Asset Sale Proceeds were
reinvested within such period or (y) the Reinvestment Period for such Net Asset
Sale Proceeds has NOT expired; provided that the aggregate amount of such Net
Asset Sale Proceeds excluded by operation of this clause (ii)(y) shall not
exceed $10,000,000 at any time.
1.2 ACCOUNTING TERMS; UTILIZATION OF GAAP FOR PURPOSES OF CALCULATIONS UNDER
AGREEMENT
Except as otherwise expressly provided in this Agreement, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. Financial statements and other information
required to be delivered by Company to Lenders pursuant to clauses (i), (ii),
(iii) and (xiii) of subsection 6.1 shall be prepared in accordance with GAAP as
in effect at the time of such preparation (and delivered together with the
reconciliation statements provided for in subsection 6.1(v)). Calculations in
connection with the definitions, covenants and other provisions of this
Agreement shall utilize accounting principles and policies in conformity with
those used to prepare the financial statements referred to in subsection 5.3.
1.3 OTHER DEFINITIONAL PROVISIONS AND RULES OF CONSTRUCTION
A. Any of the terms defined herein and in the other Loan Documents may,
unless the context otherwise requires, be used in the singular or the plural,
depending on the reference.
B. References to "Sections" and "subsections" shall be to Sections and
subsections, respectively, of this Agreement unless otherwise specifically
provided.
C. The use herein and in the other Loan Documents of the word "include"
or "including", when following any general statement, term or matter, shall not
be construed to limit
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such statement, term or matter to the specific items or matters set forth
immediately following such word or to similar items or matters, whether or not
nonlimiting language (such as "without limitation" or "but not limited to" or
words of similar import) is used with reference thereto, but rather shall be
deemed to refer to all other items or matters that fall within the broadest
possible scope of such general statement, term or matter.
SECTION 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS
2.1 COMMITMENTS; MAKING OF LOANS; NOTES
A. COMMITMENTS. Subject to the terms and conditions of this Agreement
and in reliance upon the representations and warranties of Company
herein set forth, each Tranche A Term Loan Lender hereby severally
agrees to make the Tranche A Term Loans described in subsection
2.1A(i), each Tranche B Term Loan Lender hereby severally agrees to
make the Tranche B Term Loans described in subsection 2.1A(ii), each
Revolving Loan Lender hereby severally agrees to make the Revolving
Loans described in subsection 2.1A(iii), and each Swing Line Lender
hereby agrees to make the Swing Line Loans described in subsection
2.1A(iv).
(i) TRANCHE A TERM LOANS. Each Tranche A Term Loan Lender
severally agrees to lend to Company on the Closing Date and on the
Second Tranche A Draw Date an aggregate amount not exceeding its Pro
Rata Share of the aggregate amount of the Tranche A Term Loan
Commitments to be used for the purposes identified in subsection 2.5A;
PROVIDED that prior to, or simultaneously with the funding of the
initial Tranche A Term Loans, the Tranche B Term Loans shall have been
funded in full. The amount of each Tranche A Term Loan Lender's Tranche
A Term Loan Commitment is set forth opposite its name on SCHEDULE 2.1
annexed hereto and the aggregate amount of the Tranche A Term Loan
Commitments is $175,000,000; PROVIDED that the Tranche A Term Loan
Commitments of the Tranche A Term Loan Lenders shall be adjusted to
give effect to any assignments of the Tranche A Term Loan Commitments
pursuant to subsection 10.1B and to any reductions thereof pursuant to
Section 2.4B(ii). Each Tranche A Term Loan Lender's Term Loan
Commitment (i) shall expire immediately and without further action on
December 31, 1998, if the initial Tranche A Term Loans are not made on
or before that date, (ii) shall be reduced by an amount equal to the
principal amount of the Tranche A Term Loan made by such Tranche A Term
Loan Lender on the Closing Date, and (iii) to the extent unused, shall
expire on the close of business on the Tranche A Term Loan Commitment
Termination Date. Company may make one borrowing under the Tranche A
Term Loan Commitments on the Closing Date and one borrowing on the
Second Tranche A Draw Date. Amounts borrowed under this subsection
2.1A(i) and subsequently repaid or prepaid may not be reborrowed.
(ii) TRANCHE B TERM LOANS. Each Tranche B Term Loan Lender
severally agrees to lend to Company on the Closing Date an amount not
exceeding its Pro Rata Share of the aggregate amount of the Tranche B
Term Loan Commitments to be used for the purposes identified in
subsection 2.5A. The amount of each Lender's Tranche B Term Loan
Commitment is set forth opposite its name on SCHEDULE 2.1 annexed
hereto and the
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aggregate amount of the Tranche B Term Loan Commitments is
$125,000,000; provided that the Tranche B Term Loan Commitments of
Tranche B Term Loan Lenders shall be adjusted to give effect to any
assignments of the Tranche B Term Loan Commitments pursuant to
subsection 10.1B. Each Tranche B Term Loan Lender's Tranche B Term Loan
Commitment shall expire immediately and without further action on
December 31, 1998 if the Tranche B Term Loans are not made on or before
that date. Company may make only one borrowing under the Tranche B Term
Loan Commitments. Amounts borrowed under this subsection 2.1A(ii) and
subsequently repaid or prepaid may not be reborrowed.
(iii) REVOLVING LOANS. Each Revolving Loan Lender severally
agrees, subject to the limitations set forth below with respect to the
maximum amount of Revolving Loans permitted to be outstanding from time
to time, to lend to Company from time to time during the period from
the Closing Date to but excluding the Revolving Loan Commitment
Termination Date an aggregate amount not exceeding its Pro Rata Share
of the aggregate amount of the Revolving Loan Commitments to be used
for the purposes identified in subsection 2.5B. The original amount of
each Lender's Revolving Loan Commitment is set forth opposite its name
on SCHEDULE 2.1 annexed hereto and the aggregate original amount of the
Revolving Loan Commitments is $25,000,000; provided that the Revolving
Loan Commitments of Revolving Loan Lenders shall be adjusted to give
effect to any assignments of the Revolving Loan Commitments pursuant to
subsection 10.1B; and provided, further that the amount of the
Revolving Loan Commitments shall be reduced from time to time by the
amount of any reductions thereto made pursuant to subsections 2.4B(ii)
and 2.4B(iii). Each Revolving Loan Lender's Revolving Loan Commitment
shall expire on the Revolving Loan Commitment Termination Date and all
Revolving Loans and all other amounts owed hereunder with respect to
the Revolving Loans and the Revolving Loan Commitments shall be paid in
full no later than that date; provided that each Revolving Loan
Lender's Revolving Loan Commitment shall expire immediately and without
further action on December 31, 1998 if the initial Term Loans are not
made on or before that date. Amounts borrowed under this subsection
2.1A(iii) may be repaid and reborrowed to but excluding the Revolving
Loan Commitment Termination Date.
Anything contained in this Agreement to the contrary
notwithstanding, the Revolving Loans and the Revolving Loan Commitments
shall be subject to the limitation that in no event shall the Total
Utilization of Revolving Loan Commitments at any time exceed the
Revolving Loan Commitments then in effect.
(iv) SWING LINE LOANS. Swing Line Lender hereby agrees,
subject to the limitations set forth below with respect to the maximum
amount of Swing Line Loans permitted to be outstanding from time to
time, to make a portion of the Revolving Loan Commitments available to
Company from time to time during the period from the Closing Date to
but excluding the Revolving Loan Commitment Termination Date by making
Swing Line Loans to Company in an aggregate amount not exceeding the
amount of the Swing Line Loan Commitment to be used for the purposes
identified in subsection 2.5B,
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notwithstanding the fact that such Swing Line Loans, when aggregated
with Swing Line Lender's outstanding Revolving Loans and Swing Line
Lender's Pro Rata Share of the Letter of Credit Usage then in effect,
may exceed Swing Line Lender's Revolving Loan Commitment. The original
amount of the Swing Line Loan Commitment is $5,000,000; provided that
any reduction of the Revolving Loan Commitments made pursuant to
subsection 2.4B(ii) or 2.4B(iii) which reduces the aggregate Revolving
Loan Commitments to an amount less than the then current amount of the
Swing Line Loan Commitment shall result in an automatic corresponding
reduction of the Swing Line Loan Commitment to the amount of the
Revolving Loan Commitments, as so reduced, without any further action
on the part of Company, Administrative Agent or Swing Line Lender. The
Swing Line Loan Commitment shall expire on the Revolving Loan
Commitment Termination Date and all Swing Line Loans and all other
amounts owed hereunder with respect to the Swing Line Loans shall be
paid in full no later than that date; provided that the Swing Line Loan
Commitment shall expire immediately and without further action on
December 31, 1998 if the initial Term Loans are not made on or before
that date. Amounts borrowed under this subsection 2.1A(iv) may be
repaid and reborrowed to but excluding the Revolving Loan Commitment
Termination Date.
Anything contained in this Agreement to the contrary
notwithstanding, the Swing Line Loans and the Swing Line Loan
Commitment shall be subject to the limitation that in no event shall
the Total Utilization of Revolving Loan Commitments at any time exceed
the Revolving Loan Commitments then in effect.
With respect to any Swing Line Loans which have not been
voluntarily prepaid by Company pursuant to subsection 2.4B(i), Swing Line Lender
may, at any time in its sole and absolute discretion, deliver to Administrative
Agent (with a copy to Company), no later than 11:00 A.M. (Charlotte, North
Carolina time) on the first Business Day in advance of the proposed Funding
Date, a notice (which shall be deemed to be a Notice of Borrowing given by
Company) requesting Revolving Loan Lenders to make Revolving Loans that are Base
Rate Loans on such Funding Date in an amount equal to the amount of such Swing
Line Loans (the "REFUNDED SWING LINE LOANS") outstanding on the date such notice
is given which Swing Line Lender requests Lenders to prepay. Anything contained
in this Agreement to the contrary notwithstanding, (i) the proceeds of such
Revolving Loans made by Revolving Loan Lenders other than Swing Line Lender
shall be immediately delivered by Administrative Agent to Swing Line Lender (and
not to Company) and applied to repay a corresponding portion of the Refunded
Swing Line Loans and (ii) on the day such Revolving Loans are made, Swing Line
Lender's Pro Rata Share of the Refunded Swing Line Loans shall be deemed to be
paid with the proceeds of a Revolving Loan made by Swing Line Lender, and such
portion of the Swing Line Loans deemed to be so paid shall no longer be
outstanding as Swing Line Loans and shall no longer be due under the Swing Line
Note of Swing Line Lender but shall instead constitute part of Swing Line
Lender's outstanding Revolving Loans and shall be due under the Revolving Note
of Swing Line Lender. Company hereby authorizes Administrative Agent and Swing
Line Lender to charge Company's accounts with Administrative Agent and Swing
Line Lender (up to the amount available in each such account) in order to
immediately pay Swing Line Lender the amount of the Refunded Swing Line Loans to
the extent the proceeds of such Revolving Loans made by
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Lenders, including the Revolving Loan deemed to be made by Swing Line Lender,
are not sufficient to repay in full the Refunded Swing Line Loans. If any
portion of any such amount paid (or deemed to be paid) to Swing Line Lender
should be recovered by or on behalf of Company from Swing Line Lender in
bankruptcy, by assignment for the benefit of creditors or otherwise, the loss of
the amount so recovered shall be ratably shared among all Revolving Loan Lenders
in the manner contemplated by subsection 10.5.
If for any reason (a) Revolving Loans are not made upon the request
of Swing Line Lender as provided in the immediately preceding paragraph in an
amount sufficient to repay any amounts owed to Swing Line Lender in respect of
any outstanding Swing Line Loans or (b) the Revolving Loan Commitments are
terminated at a time when any Swing Line Loans are outstanding, each Revolving
Loan Lender shall be deemed to, and hereby agrees to, have purchased a
participation in such outstanding Swing Line Loans in an amount equal to its Pro
Rata Share of the Revolving Loan Commitments (calculated, in the case of the
foregoing clause (b), immediately prior to such termination of the Revolving
Loan Commitments) of the unpaid amount of such Swing Line Loans together with
accrued interest thereon. Upon one Business Day's notice from Swing Line Lender,
each Revolving Loan Lender shall deliver to Swing Line Lender an amount equal to
its respective participation in same day funds at the Funding and Payment
Office. In order to further evidence such participation (and without prejudice
to the effectiveness of the participation provisions set forth above), each
Revolving Loan Lender agrees to enter into a separate participation agreement at
the request of Swing Line Lender in form and substance reasonably satisfactory
to Swing Line Lender. In the event any Revolving Loan Lender fails to make
available to Swing Line Lender the amount of such Revolving Loan Lender's
participation as provided in this paragraph, Swing Line Lender shall be entitled
to recover such amount on demand from such Revolving Loan Lender together with
interest thereon at the rate customarily used by Swing Line Lender for the
correction of errors among banks for three Business Days and thereafter at the
Base Rate. In the event Swing Line Lender receives a payment of any amount in
which other Revolving Loan Lenders have purchased participations as provided in
this paragraph, Swing Line Lender shall promptly distribute to each such other
Revolving Loan Lender its Pro Rata Share of such payment.
Anything contained herein to the contrary notwithstanding, each
Revolving Loan Lender's obligation to make Revolving Loans for the purpose of
repaying any Refunded Swing Line Loans pursuant to the second preceding
paragraph and each Revolving Loan Lender's obligation to purchase a
participation in any unpaid Swing Line Loans pursuant to the immediately
preceding paragraph shall be absolute and unconditional and shall not be
affected by any circumstance, including (a) any set-off, counterclaim,
recoupment, defense or other right which such Lender may have against Swing Line
Lender, Company or any other Person for any reason whatsoever; (b) the
occurrence or continuation of an Event of Default or a Potential Event of
Default; (c) any adverse change in the business, operations, properties, assets,
condition (financial or otherwise) or prospects of Company or any of its
Subsidiaries; (d) any breach of this Agreement or any other Loan Document by any
party thereto; or (e) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing; PROVIDED that such obligations
of each Revolving Loan Lender are subject to the condition that (X) Swing Line
Lender believed in good faith that all conditions under Section 4 to the making
of the applicable
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Refunded Swing Line Loans or other unpaid Swing Line Loans, as the case may be,
were satisfied at the time such Refunded Swing Line Loans or unpaid Swing Line
Loans were made or (Y) the satisfaction of any such condition not satisfied had
been waived in accordance with subsection 10.6 prior to or at the time such
Refunded Swing Line Loans or other unpaid Swing Line Loans were made.
B. BORROWING MECHANICS. Tranche A Term Loans or Tranche B Term Loans or
Revolving Loans made on any Funding Date (other than Revolving Loans made
pursuant to a request by Swing Line Lender pursuant to subsection 2.1A(iv) for
the purpose of repaying any Refunded Swing Line Loans or Revolving Loans made
pursuant to subsection 3.3B for the purpose of reimbursing any Issuing Lender
for the amount of a drawing under a Letter of Credit issued by it) shall be in
an aggregate minimum amount of $1,000,000 and integral multiples of $1,000,000
in excess of that amount; provided that Tranche A Term Loans or Tranche B Term
Loans or Revolving Loans made on any Funding Date as Eurodollar Rate Loans with
a particular Interest Period shall be in an aggregate minimum amount of
$3,000,000 and integral multiples of $1,000,000 in excess of that amount. Swing
Line Loans made on any Funding Date shall be in an aggregate minimum amount of
$100,000 and integral multiples of $100,000 in excess of that amount. Whenever
Company desires that Lenders make Term Loans or Revolving Loans it shall deliver
to Administrative Agent a Notice of Borrowing no later than 11:00 A.M.
(Charlotte, North Carolina time) at least three Business Days in advance of the
proposed Funding Date (in the case of a Eurodollar Rate Loan) or at least one
Business Day in advance of the proposed Funding Date (in the case of a Base Rate
Loan). Whenever Company desires that Swing Line Lender make a Swing Line Loan,
it shall deliver to Administrative Agent a Notice of Borrowing no later than
1:00 P.M. (Charlotte, North Carolina time) on the proposed Funding Date. The
Notice of Borrowing shall specify (i) the proposed Funding Date (which shall be
a Business Day), (ii) the amount and type of Loans requested, (iii) in the case
of Swing Line Loans, any Loans made on the Closing Date, and any Tranche A Term
Loans made on the Tranche A Term Loan Commitment Termination Date, that such
Loans shall be Base Rate Loans, (iv) in the case of Term Loans and Revolving
Loans in each case not made on the Closing Date or in the case of Tranche A Term
Loans not made on the Tranche A Term Loan Commitment Termination Date, whether
such Loans shall be Base Rate Loans or Eurodollar Rate Loans, and (v) in the
case of any Loans requested to be made as Eurodollar Rate Loans, the initial
Interest Period requested therefor. Term Loans and Revolving Loans may be
continued as or converted into Base Rate Loans and Eurodollar Rate Loans in the
manner provided in subsection 2.2D. In lieu of delivering the above-described
Notice of Borrowing, Company may give Administrative Agent telephonic notice by
the required time of any proposed borrowing under this subsection 2.1B; provided
that such notice shall be promptly confirmed in writing by delivery of a Notice
of Borrowing to Administrative Agent on or before the applicable Funding Date.
Neither Administrative Agent nor any Lender shall incur any
liability to Company in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to borrow on behalf of Company or
for otherwise acting in good faith under this subsection 2.1B, and upon funding
of Loans by Lenders in accordance with this Agreement pursuant to any such
telephonic notice Company shall have effected Loans hereunder.
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Company shall notify Administrative Agent prior to the funding of
any Loans in the event that any of the matters to which Company is required to
certify in the applicable Notice of Borrowing is no longer true and correct as
of the applicable Funding Date, and the acceptance by Company of the proceeds of
any Loans shall constitute a re-certification by Company, as of the applicable
Funding Date, as to the matters to which Company is required to certify in the
applicable Notice of Borrowing.
Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G, a
Notice of Borrowing for a Eurodollar Rate Loan (or telephonic notice in lieu
thereof) shall be irrevocable on and after the related Interest Rate
Determination Date, and Company shall be bound to make a borrowing in accordance
therewith.
C. DISBURSEMENT OF FUNDS. All Loans (other than Swing Line Loans) under
this Agreement shall be made by Lenders simultaneously and proportionately to
their respective Pro Rata Shares, it being understood that no Lender shall be
responsible for any default by any other Lender in that other Lender's
obligation to make a Loan requested hereunder nor shall the Commitment of any
Lender to make the particular type of Loan requested be increased or decreased
as a result of a default by any other Lender in that other Lender's obligation
to make a Loan requested hereunder. Promptly after receipt by Administrative
Agent of a Notice of Borrowing pursuant to subsection 2.1B (or telephonic notice
in lieu thereof), Administrative Agent shall notify each Lender or Swing Line
Lender, as the case may be, of the proposed borrowing. Each Lender shall make
the amount of its Loan available to Administrative Agent not later than 1:00
P.M. (Charlotte, North Carolina time) on the applicable Funding Date, and Swing
Line Lender shall make the amount of its Swing Line Loan available to
Administrative Agent not later than 2:00 P.M. (Charlotte, North Carolina time)
on the applicable Funding Date, in each case in same day funds in Dollars, at
the Funding and Payment Office. Except as provided in subsection 2.1A(iv) or
subsection 3.3B with respect to Revolving Loans used to repay Refunded Swing
Line Loans or to reimburse any Issuing Lender for the amount of a drawing under
a Letter of Credit issued by it, upon satisfaction or waiver of the conditions
precedent specified in subsections 4.1 (in the case of Loans made on the Closing
Date) and 4.2 (in the case of all Loans), Administrative Agent shall make the
proceeds of such Loans available to Company on the applicable Funding Date by
causing an amount of same day funds in Dollars equal to the proceeds of all such
Loans received by Administrative Agent from Lenders or Swing Line Lender, as the
case may be, to be credited to the account of Company at the Funding and Payment
Office. Company hereby irrevocably authorizes Administrative Agent to disburse
the proceeds of each Loan requested pursuant to this subsection 2.1 in
immediately available funds by crediting such proceeds to a deposit account of
Company maintained with Administrative Agent or by wire transfer to any other
account of Company in each such case as may be specified by Company from time to
time in a written notice in the form attached hereto as EXHIBIT XXI (a "NOTICE
OF ACCOUNT DESIGNATION"). Unless otherwise specified by Company, the Notice of
Account Designation most recently provided to Administrative Agent shall
control.
Unless Administrative Agent shall have been notified by any Lender
prior to the Funding Date for any Loans that such Lender does not intend to make
available to Administrative Agent the amount of such Lender's Loan requested on
such Funding Date, Administrative Agent
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may assume that such Lender has made such amount available to Administrative
Agent on such Funding Date and Administrative Agent may, in its sole discretion,
but shall not be obligated to, make available to Company a corresponding amount
on such Funding Date. If such corresponding amount is not in fact made available
to Administrative Agent by such Lender, Administrative Agent shall be entitled
to recover such corresponding amount on demand from such Lender together with
interest thereon, for each day from such Funding Date until the date such amount
is paid to Administrative Agent, at the customary rate set by Administrative
Agent for the correction of errors among banks for three Business Days and
thereafter at the Base Rate. If such Lender does not pay such corresponding
amount forthwith upon Administrative Agent's demand therefor, Administrative
Agent shall promptly notify Company and Company shall immediately pay such
corresponding amount to Administrative Agent together with interest thereon, for
each day from such Funding Date until the date such amount is paid to
Administrative Agent, at the rate payable under this Agreement for Base Rate
Loans. Nothing in this subsection 2.1C shall be deemed to relieve any Lender
from its obligation to fulfill its Commitments hereunder or to prejudice any
rights that Company may have against any Lender as a result of any default by
such Lender hereunder.
D. THE REGISTER.
(i) Administrative Agent shall maintain, at its address referred to in
subsection 10.8, a register for the recordation of the names and addresses of
Lenders and the Commitments and Loans of each Lender from time to time (the
"Register"). The Register shall be available for inspection by Company or any
Lender at any reasonable time and from time to time upon reasonable prior
notice.
(ii) Administrative Agent shall record in the Register the Tranche A
Term Loan Commitment, Tranche B Term Loan Commitment and Revolving Loan
Commitment and the Tranche A Term Loan, Tranche B Term Loan and Revolving Loans
from time to time of each Lender, the Swing Line Loan Commitment and the Swing
Line Loans from time to time of Swing Line Lender, and each repayment or
prepayment in respect of the principal amount of the Tranche A Term Loan,
Tranche B Term Loan or Revolving Loans of each Lender or the Swing Line Loans of
Swing Line Lender. Any such recordation shall be conclusive and binding on
Company and each Lender, absent manifest error; provided that failure to make
any such recordation, or any error in such recordation, shall not affect any
Lender's Commitments or Company's Obligations in respect of any applicable
Loans.
(iii) Each Lender shall record on its internal records (including,
without limitation, the Notes held by such Lender) the amount of the Tranche A
Term Loan, Tranche B Term Loan and each Revolving Loan made by it and each
payment in respect thereof. Any such recordation shall be conclusive and binding
on Company, absent manifest error; provided that failure to make any such
recordation, or any error in such recordation, shall not affect any Lender's
Commitments or Company's Obligations in respect of any applicable Loans; and
provided, further that in the event of any inconsistency between the Register
and any Lender's records, the recordations in the Register shall govern.
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(iv) Company, Administrative Agent and Lenders shall deem and treat the
Persons listed as Lenders in the Register as the holders and owners of the
corresponding Commitments and Loans listed therein for all purposes hereof, and
no assignment or transfer of any such Commitment or Loan shall be effective, in
each case unless and until an Assignment Agreement effecting the assignment or
transfer thereof shall have been accepted by Administrative Agent and recorded
in the Register as provided in subsection 10.1B(ii). Prior to such recordation,
all amounts owed with respect to the applicable Commitment or Loan shall be owed
to the Lender listed in the Register as the owner thereof, and any request,
authority or consent of any Person who, at the time of making such request or
giving such authority or consent, is listed in the Register as a Lender shall be
conclusive and binding on any subsequent holder, assignee or transferee of the
corresponding Commitments or Loans.
(v) Company hereby designates Administrative Agent to serve as
Company's agent solely for purposes of maintaining the Register as provided in
this subsection 2.1D, and Company hereby agrees that, to the extent
Administrative Agent serves in such capacity, Administrative Agent and its
officers, directors, employees, agents and affiliates shall constitute
Indemnitees for all purposes under subsection 10.3.
E. NOTES. Company shall execute and deliver on the Closing Date (i) to
each Tranche A Term Loan Lender (or to Administrative Agent for that Lender) a
Tranche A Term Note substantially in the form of EXHIBIT IV annexed hereto to
evidence that Lender's Tranche A Term Loan, in the principal amount of that
Lender's Tranche A Term Loan and with other appropriate insertions, (ii) to each
Tranche B Term Loan Lender (or to Administrative Agent for that Lender) a
Tranche B Term Note substantially in the form of EXHIBIT V annexed hereto to
evidence that Lender's Tranche B Term Loan, in the principal amount of that
Lender's Tranche B Term Loan and with other appropriate insertions, (iii) to
each Revolving Loan Lender (or to Administrative Agent for that Lender) a
Revolving Note substantially in the form of EXHIBIT VI annexed hereto to
evidence that Lender's Revolving Loans, in the principal amount of that Lender's
Revolving Loan Commitment and with other appropriate insertions, and (iv) to
Swing Line Lender (or to Administrative Agent for Swing Line Lender) a Swing
Line Note substantially in the form of EXHIBIT VII annexed hereto to evidence
Swing Line Lender's Swing Line Loans, in the principal amount of the Swing Line
Loan Commitment and with other appropriate insertions.
Administrative Agent may deem and treat the payee of any Note as the
owner thereof for all purposes hereof unless and until an Assignment Agreement
effecting the assignment or transfer thereof shall have been accepted by
Administrative Agent as provided in subsection 10.1B(ii). Any request, authority
or consent of any person or entity who, at the time of making such request or
giving such authority or consent, is the holder of any Note shall be conclusive
and binding on any subsequent holder, assignee or transferee of that Note or of
any Note or Notes issued in exchange therefor.
2.2 INTEREST ON THE LOANS
A. RATE OF INTEREST. Subject to the provisions of subsections 2.6 and
2.7, each Term Loan and each Revolving Loan shall bear interest on the unpaid
principal amount thereof from the
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date made through maturity (whether by acceleration or otherwise) at a rate
determined by reference to the Base Rate or the Adjusted Eurodollar Rate.
Subject to the provisions of subsection 2.7, each Swing Line Loan shall bear
interest on the unpaid principal amount thereof from the date made through
maturity (whether by acceleration or otherwise) at a rate determined by
reference to the Base Rate. The applicable basis for determining the rate of
interest with respect to any Term Loan or any Revolving Loan shall be selected
by Company initially at the time a Notice of Borrowing is given with respect to
such Loan pursuant to subsection 2.1B, and the basis for determining the
interest rate with respect to any Term Loan or any Revolving Loan may be changed
from time to time pursuant to subsection 2.2D. If on any day a Term Loan or
Revolving Loan is outstanding with respect to which notice has not been
delivered to Administrative Agent in accordance with the terms of this Agreement
specifying the applicable basis for determining the rate of interest, then for
that day that Loan shall bear interest determined by reference to the Base Rate.
(i) Subject to the provisions of subsections 2.2E and 2.7, the
Tranche A Term Loans and the Revolving Loans shall bear interest
through maturity as follows:
(a) if a Base Rate Loan, then at the sum of the Base Rate
plus the Applicable Base Rate Margin; or
(b) if a Eurodollar Rate Loan, then at the sum of the
Adjusted Eurodollar Rate plus the Applicable Eurodollar Rate
Margin.
(ii) Subject to the provisions of subsections 2.2E and 2.7,
the Tranche B Term Loans shall bear interest through maturity as
follows:
(a) if a Base Rate Loan, then at the sum of the Base Rate
plus 2.50% per annum; or
(b) if a Eurodollar Rate Loan, then at the sum of the
Adjusted Eurodollar Rate plus 3.50% per annum.
(iii) Subject to the provisions of subsections 2.2E and 2.7,
the Swing Line Loans shall bear interest through maturity at the sum of
the Base Rate plus the Applicable Base Rate Margin MINUS the Applicable
Commitment Fee Percentage per annum.
B. INTEREST PERIODS. In connection with each Eurodollar Rate Loan,
Company may, pursuant to the applicable Notice of Borrowing or Notice of
Conversion/Continuation, as the case may be, select an interest period (each an
"INTEREST PERIOD") to be applicable to such Loan, which Interest Period shall
be, at Company's option, either a one, two, three or six month period; provided
that:
(i) the initial Interest Period for any Eurodollar Rate Loan
shall commence on the Funding Date in respect of such Loan, in the case
of a Loan initially made as a Eurodollar Rate Loan, or on the date
specified in the applicable Notice of Conversion/Continuation, in the
case of a Loan converted to a Eurodollar Rate Loan;
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(ii) in the case of immediately successive Interest Periods
applicable to a Eurodollar Rate Loan continued as such pursuant to a
Notice of Conversion/Continuation, each successive Interest Period
shall commence on the day on which the next preceding Interest Period
expires;
(iii) if an Interest Period would otherwise expire on a day
that is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day; provided that, if any Interest Period
would otherwise expire on a day that is not a Business Day but is a day
of the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the next preceding Business Day;
(iv) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clause (v) of this subsection 2.2B, end on
the last Business Day of a calendar month;
(v) no Interest Period with respect to any portion of the
Tranche A Term Loans shall extend beyond May 31, 2005, no Interest
Period with respect to any portion of the Tranche B Term Loans shall
extend beyond May 31, 2006 and no Interest Period with respect to any
portion of the Revolving Loans shall extend beyond the Revolving Loan
Commitment Termination Date;
(vi) no Interest Period with respect to any portion of the
Tranche A Term Loans or Tranche B Term Loans shall extend beyond a date
on which Company is required to make a scheduled payment of principal
of the Tranche A Term Loans or Tranche B Term Loans, as the case may
be, unless the sum of (a) the aggregate principal amount of Tranche A
Term Loans or Tranche B Term Loans, as the case may be, that are Base
Rate Loans plus (b) the aggregate principal amount of Tranche A Term
Loans or Tranche B Term Loans, as the case may be, that are Eurodollar
Rate Loans with Interest Periods expiring on or before such date equals
or exceeds the principal amount required to be paid on the Tranche A
Term Loans or Tranche B Term Loans, as the case may be, on such date;
(vii) [INTENTIONALLY OMITTED];
(viii) there shall be no more than 10 Interest Periods
outstanding at any time; and
(ix) in the event Company fails to specify an Interest Period
for any Eurodollar Rate Loan in the applicable Notice of Borrowing or
Notice of Conversion/Continuation, Company shall be deemed to have
selected an Interest Period of one month.
C. INTEREST PAYMENTS. Subject to the provisions of subsection 2.2E,
interest on each Loan shall be payable in arrears on and to each Interest
Payment Date applicable to that Loan, upon any prepayment of that Loan (to the
extent accrued on the amount being prepaid) and at
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maturity (including final maturity); provided that in the event any Swing Line
Loans or any Revolving Loans that are Base Rate Loans are prepaid pursuant to
subsection 2.4B(i), interest accrued on such Swing Line Loans or Revolving Loans
through the date of such prepayment shall be payable on the next succeeding
Interest Payment Date applicable to Base Rate Loans (or, if earlier, at final
maturity).
D. CONVERSION OR CONTINUATION. Subject to the provisions of subsection
2.6, Company shall have the option (i) to convert at any time all or any part of
its outstanding Tranche A Term Loans, Tranche B Term Loans or Revolving Loans
equal to $3,000,000 and integral multiples of $1,000,000 in excess of that
amount from Loans bearing interest at a rate determined by reference to one
basis to Loans bearing interest at a rate determined by reference to an
alternative basis or (ii) upon the expiration of any Interest Period applicable
to a Eurodollar Rate Loan, to continue all or any portion of such Loan equal to
$3,000,000 and integral multiples of $1,000,000 in excess of that amount as a
Eurodollar Rate Loan; provided, however, that a Eurodollar Rate Loan may only be
converted into a Base Rate Loan on the expiration date of an Interest Period
applicable thereto.
Company shall deliver a Notice of Conversion/Continuation to
Administrative Agent no later than 11:00 A.M. (Charlotte, North Carolina time)
at least one Business Day in advance of the proposed conversion date (in the
case of a conversion to a Base Rate Loan) and at least three Business Days in
advance of the proposed conversion/continuation date (in the case of a
conversion to, or a continuation of, a Eurodollar Rate Loan). A Notice of
Conversion/Continuation shall specify (i) the proposed conversion/continuation
date (which shall be a Business Day), (ii) the amount and type of the Loan to be
converted/continued, (iii) the nature of the proposed conversion/continuation,
(iv) in the case of a conversion to, or a continuation of, a Eurodollar Rate
Loan, the requested Interest Period, and (v) in the case of a conversion to, or
a continuation of, a Eurodollar Rate Loan, that no Potential Event of Default or
Event of Default has occurred and is continuing. In lieu of delivering the
above-described Notice of Conversion/Continuation, Company may give
Administrative Agent telephonic notice by the required time of any proposed
conversion/continuation under this subsection 2.2D; PROVIDED that such notice
shall be promptly confirmed in writing by delivery of a Notice of
Conversion/Continuation to Administrative Agent on or before the proposed
conversion/continuation date. Upon receipt of written or telephonic notice of
any proposed conversion/continuation under this subsection 2.2D, Administrative
Agent shall promptly transmit such notice by telefacsimile or telephone to each
Lender.
Neither Administrative Agent nor any Lender shall incur any
liability to Company in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to act on behalf of Company or for
otherwise acting in good faith under this subsection 2.2D, and upon conversion
or continuation of the applicable basis for determining the interest rate with
respect to any Loans in accordance with this Agreement pursuant to any such
telephonic notice Company shall have effected a conversion or continuation, as
the case may be, hereunder.
Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G, a
Notice of
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Conversion/Continuation for conversion to, or continuation of, a Eurodollar Rate
Loan (or telephonic notice in lieu thereof) shall be irrevocable on and after
the related Interest Rate Determination Date, and Company shall be bound to
effect a conversion or continuation in accordance therewith.
E. DEFAULT RATE. Upon the occurrence and during the continuation of any
Event of Default, the outstanding principal amount of all Loans and, to the
extent permitted by applicable law, any interest payments thereon not paid when
due and any fees and other amounts then due and payable hereunder, shall
thereafter bear interest (including post-petition interest in any proceeding
under the Bankruptcy Code or other applicable bankruptcy laws) payable upon
demand at a rate that is 2% per annum in excess of the interest rate otherwise
payable under this Agreement with respect to the applicable Loans (or, in the
case of any such fees and other amounts, at a rate which is 2% per annum in
excess of the interest rate otherwise payable under this Agreement for Base Rate
Loans that are Tranche B Term Loans); provided that, in the case of Eurodollar
Rate Loans, upon the expiration of the Interest Period in effect at the time any
such increase in interest rate is effective such Eurodollar Rate Loans shall
thereupon become Base Rate Loans and shall thereafter bear interest payable upon
demand at a rate which is 2% per annum in excess of the interest rate otherwise
payable under this Agreement for Base Rate Loans. Payment or acceptance of the
increased rates of interest provided for in this subsection 2.2E is not a
permitted alternative to timely payment and shall not constitute a waiver of any
Event of Default or otherwise prejudice or limit any rights or remedies of any
Agent or any Lender.
F. COMPUTATION OF INTEREST. Interest on the Loans shall be computed (i)
in the case of Base Rate Loans, on the basis of a 365-day or 366-day year, as
the case may be, and (ii) in the case of Eurodollar Rate Loans, on the basis of
a 360-day year, in each case for the actual number of days elapsed in the period
during which it accrues. In computing interest on any Loan, the date of the
making of such Loan or the first day of an Interest Period applicable to such
Loan or, with respect to a Base Rate Loan being converted from a Eurodollar Rate
Loan, the date of conversion of such Eurodollar Rate Loan to such Base Rate
Loan, as the case may be, shall be included, and the date of payment of such
Loan or the expiration date of an Interest Period applicable to such Loan or,
with respect to a Base Rate Loan being converted to a Eurodollar Rate Loan, the
date of conversion of such Base Rate Loan to such Eurodollar Rate Loan, as the
case may be, shall be excluded; provided that if a Loan is repaid on the same
day on which it is made, one day's interest shall be paid on that Loan.
2.3 FEES
A. COMMITMENT FEES.
(i) REVOLVING LOAN COMMITMENTS. Company agrees to pay to
Administrative Agent, for distribution to each Revolving Loan Lender in
proportion to that Lender's Pro Rata Share of the Revolving Loan
Commitments, commitment fees for the period from and including the
Closing Date to and excluding the Revolving Loan Commitment Termination
Date equal to the average of the daily excess of the Revolving Loan
Commitments over the sum of (i) the aggregate principal amount of
outstanding
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Revolving Loans (but not any outstanding Swing Line Loans) plus (ii)
the Letter of Credit Usage multiplied by the Applicable Commitment Fee
Percentage per annum, such commitment fees to be calculated on the
basis of a 360-day year and the actual number of days elapsed and to be
payable quarterly in arrears on the last Business Day of March, June,
September and December of each year, commencing on the first such date
to occur after the Closing Date, and on the Revolving Loan Commitment
Termination Date.
(ii) TRANCHE A TERM LOAN COMMITMENTS. In the event that the Tranche
A Term Loan Commitments are not fully utilized on the Closing Date,
Company agrees to pay to Administrative Agent, for distribution to each
Tranche A Term Loan Lender in proportion to that Lender's Pro Rata
Share of the Tranche A Term Loan Commitments, commitment fees for the
period from and including the Closing Date to and excluding the Tranche
A Term Loan Commitment Termination Date equal to the average of the
daily excess of the Tranche A Term Loan Commitments over the aggregate
principal amount of outstanding Tranche A Term Loans multiplied by
2.75% per annum, such commitment fees to be calculated on the basis of
a 360-day year and the actual number of days elapsed and to be payable
in arrears on the earlier of the Tranche A Term Loan Commitment
Termination Date and the Second Tranche A Draw Date.
B. OTHER FEES. Company agrees to pay to Arranger and each Agent such
other fees in the amounts and at the times separately agreed upon between
Company, Agents and Arranger.
2.4 REPAYMENTS, PREPAYMENTS AND REDUCTIONS IN REVOLVING LOAN COMMITMENTS;
GENERAL PROVISIONS REGARDING PAYMENTS; APPLICATION OF PROCEEDS OF COLLATERAL AND
PAYMENTS UNDER SUBSIDIARY GUARANTY
A. SCHEDULED PAYMENTS OF TRANCHE A TERM LOANS AND TRANCHE B TERM LOANS
(i) SCHEDULED PAYMENTS OF TRANCHE A TERM LOANS. Company shall make
principal payments on the Tranche A Term Loans in installments on the
dates and in the amounts set forth below:
<TABLE>
<CAPTION>
Date Scheduled Repayment
of Tranche A Term Loans
-----------------------
<S> <C>
March 31, 1999 $2,500,000
June 30, 1999 $2,500,000
September 30, 1999 $2,500,000
December 31, 1999 $2,500,000
March 31, 2000 $2,500,000
June 30, 2000 $2,500,000
September 30, 2000 $2,500,000
</TABLE>
46
<PAGE> 54
<TABLE>
<S> <C>
December 31, 2000 $2,500,000
March 31, 2001 $5,000,000
June 30, 2001 $5,000,000
September 30, 2001 $5,000,000
December 31, 2001 $5,000,000
March 31, 2002 $6,250,000
June 30, 2002 $6,250,000
September 30, 2002 $6,250,000
December 31, 2002 $6,250,000
March 31, 2003 $7,500,000
June 30, 2003 $7,500,000
September 30, 2003 $7,500,000
December 31, 2003 $7,500,000
March 31, 2004 $10,000,000
June 30, 2004 $10,000,000
September 30, 2004 $10,000,000
December 31, 2004 $10,000,000
March 31, 2005 $20,000,000
May 31, 2005 $20,000,000
</TABLE>
; PROVIDED that the scheduled installments of principal of the Tranche A Term
Loans set forth above shall be reduced in connection with any voluntary or
mandatory prepayments of the Tranche A Term Loans in accordance with subsection
2.4B(iv); and PROVIDED, FURTHER that the Tranche A Term Loans and all other
amounts owed hereunder with respect to the Tranche A Term Loans shall be paid in
full no later than May 31, 2005 and the final installment payable by Company in
respect of the Tranche A Term Loans on such date shall be in an amount, if such
amount is different from that specified above, sufficient to repay all amounts
owing by Company under this Agreement with respect to the Tranche A Term Loans.
(ii) SCHEDULED PAYMENTS OF TRANCHE B TERM LOANS. Company shall make
principal payments on the Tranche B Term Loans in installments on the
dates and in the amounts set forth below:
Date Scheduled Repayment
----
of Tranche B Term Loans
-----------------------
March 31, 1999 $312,500
June 30, 1999 $312,500
September 30, 1999 $312,500
December 31, 1999 $312,500
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<PAGE> 55
March 31, 2000 $312,500
June 30, 2000 $312,500
September 30, 2000 $312,500
December 31, 2000 $312,500
March 31, 2001 $312,500
June 30, 2001 $312,500
September 30, 2001 $312,500
December 31, 2001 $312,500
March 31, 2002 $312,500
June 30, 2002 $312,500
September 30, 2002 $312,500
December 31, 2002 $312,500
March 31, 2003 $312,500
June 30, 2003 $312,500
September 30, 2003 $312,500
December 31, 2003 $312,500
March 31, 2004 $312,500
June 30, 2004 $312,500
September 30, 2004 $312,500
December 31, 2004 $312,500
March 31, 2005 $312,500
June 30, 2005 $312,500
September 30, 2005 $312,500
December 31, 2005 $312,500
March 31, 2006 $58,125,000
May 31, 2006 $58,125,000
; PROVIDED that the scheduled installments of principal of the Tranche B Term
Loans set forth above shall be reduced in connection with any voluntary or
mandatory prepayments of the Tranche B Term Loans in accordance with subsection
2.4B(iv); and PROVIDED, FURTHER that the Tranche B Term Loans and all other
amounts owed hereunder with respect to the Tranche B Term Loans shall be paid in
full no later than May 31, 2006, and the final installment payable by Company in
respect of the Tranche B Term Loans on such date shall be in an amount, if such
amount is different from that specified above, sufficient to repay all amounts
owing by Company under this Agreement with respect to the Tranche B Term Loans.
B. REPAYMENTS AND REDUCTIONS IN REVOLVING LOAN COMMITMENTS
(i) VOLUNTARY PREPAYMENTS. Company may, upon written or telephonic
notice to Administrative Agent on or prior to 1:00 P.M. (Charlotte,
North Carolina time) on the date of prepayment, which notice, if
telephonic, shall be promptly confirmed in writing, at
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<PAGE> 56
any time and from time to time prepay any Swing Line Loan on any
Business Day in whole or in part in an aggregate minimum amount of
$500,000 and integral multiples of $250,000 in excess of that amount.
Company may, upon not less than one Business Day's prior written or
telephonic notice, in the case of Base Rate Loans, and three Business
Days' prior written or telephonic notice, in the case of Eurodollar
Rate Loans, in each case given to Administrative Agent by 11:00 A.M.
(Charlotte, North Carolina time) on the date required and, if given by
telephone, promptly confirmed in writing to Administrative Agent (which
original written or telephonic notice Administrative Agent will
promptly transmit by telefacsimile or telephone to each Lender), at any
time and from time to time prepay any Term Loans or Revolving Loans on
any Business Day in whole or in part in an aggregate minimum amount of
$2,500,000 and integral multiples of $500,000 in excess of that amount;
provided, however, that a Eurodollar Rate Loan may only be prepaid on
the expiration of the Interest Period applicable thereto unless Company
complies with subsection 2.6D with respect to any breakage costs
resulting from such prepayment being made before the last day at the
applicable Interest Period. Notice of prepayment having been given as
aforesaid, the principal amount of the Loans specified in such notice
shall become due and payable on the prepayment date specified therein.
Any such voluntary prepayment shall be applied as specified in
subsection 2.4B(iv).
(ii) VOLUNTARY REDUCTIONS OF REVOLVING LOAN COMMITMENTS AND TRANCHE
A TERM LOAN COMMITMENTS.
(a) Company may, upon not less than three Business Days' prior
written or telephonic notice confirmed in writing to
Administrative Agent (which original written or telephonic notice
Administrative Agent will promptly transmit by telefacsimile or
telephone to each Revolving Loan Lender), at any time and from
time to time terminate in whole or permanently reduce in part,
without premium or penalty, the Revolving Loan Commitments in an
amount up to the amount by which the Revolving Loan Commitments
exceed the Total Utilization of Revolving Loan Commitments at the
time of such proposed termination or reduction; provided that any
such partial reduction of the Revolving Loan Commitments shall be
in an aggregate minimum amount of $2,500,000 and integral
multiples of $500,000 in excess of that amount. Company's notice
to Administrative Agent shall designate the date (which shall be a
Business Day) of such termination or reduction and the amount of
any partial reduction, and such termination or reduction of the
Revolving Loan Commitments shall be effective on the date
specified in Company's notice and shall reduce the Revolving Loan
Commitment of each Revolving Loan Lender proportionately to its
Pro Rata Share of the Revolving Loan Commitments.
(b) Company may, upon not less than three Business Days' prior
written or telephonic notice confirmed in writing to
Administrative Agent (which original written or telephonic notice
Administrative Agent will promptly transmit by telefacsimile or
telephone to each Tranche A Term Loan Lender), at any time and
from time to time terminate in whole or permanently reduce in
part, without
49
<PAGE> 57
premium or penalty, the Tranche A Term Loan Commitments in an
amount up to the amount by which the Tranche A Term Loan
Commitments exceed the aggregate principal amount of Tranche A
Term Loans outstanding at the time of such proposed termination or
reduction; provided that any such partial reduction of the Tranche
A Term Loan Commitments shall be in an aggregate minimum amount of
$2,500,000 and integral multiples of $500,000 in excess of that
amount. Company's notice to Administrative Agent shall designate
the date (which shall be a Business Day) of such termination or
reduction and the amount of any partial reduction, and such
termination or reduction of the Tranche A Term Loan Commitments
shall be effective on the date specified in Company's notice and
shall reduce the Tranche A Term Loan Commitment of each Tranche A
Term Loan Lender proportionately to its Pro Rata Share of the
Tranche A Term Loan Commitments.
(iii) MANDATORY PREPAYMENTS AND MANDATORY REDUCTIONS OF REVOLVING
LOAN COMMITMENTS. The Loans shall be prepaid and/or the Revolving Loan
Commitments shall be permanently reduced in the amounts and under the
circumstances set forth below, all such prepayments to be applied as
set forth below or as more specifically provided in subsection
2.4B(iv):
(a) PREPAYMENTS AND REDUCTIONS FROM UNAPPLIED NET ASSET SALE
PROCEEDS. No later than the first Business Day following the date
that any Unapplied Net Asset Sale Proceeds are received by Company
or any of its Subsidiaries in respect of any Asset Sale (other
than, prior to the Merger Date, an Asset Sale of Target Common
Stock) Company shall prepay the Loans and/or the Revolving Loan
Commitments shall be permanently reduced in an aggregate amount
equal to such Unapplied Net Asset Sale Proceeds.
(b) PREPAYMENTS AND REDUCTIONS FROM NET INSURANCE/
CONDEMNATION PROCEEDS. No later than the first Business Day
following the date of receipt by Administrative Agent or by Company
or any of its Subsidiaries of any Net Insurance/Condemnation
Proceeds that are required to be applied to prepay the Loans and/or
reduce the Revolving Loan Commitments pursuant to the provisions of
subsection 6.4C, Company shall prepay the Loans and/or the
Revolving Loan Commitments shall be permanently reduced in an
aggregate amount equal to the amount of such Net
Insurance/Condemnation Proceeds.
(c) [INTENTIONALLY OMITTED]
(d) PREPAYMENTS AND REDUCTIONS DUE TO ISSUANCE OF DEBT OR
EQUITY SECURITIES. Not later than the first Business Day following
receipt by Company of the Cash proceeds (any such proceeds, net of
underwriting discounts and commissions and other reasonable costs
and expenses associated therewith, including without limitation
reasonable legal fees and expenses, being "NET SECURITIES
PROCEEDS") from the issuance of any debt or equity Securities of
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<PAGE> 58
Company or any of its Subsidiaries after the Closing Date, Company
shall prepay the Loans and/or the Revolving Loan Commitments shall
be permanently reduced in an aggregate amount equal to 100% of such
Net Securities Proceeds PROVIDED , however, that if such Net
Securities Proceeds are from the issuance of equity Securities of
Company and the Consolidated Leverage Ratio on the last day of the
four Fiscal Quarter period most recently ended prior to the date of
receipt of such Net Securities Proceeds for which Company has
delivered a Margin Determination Certificate to Administrative
Agent pursuant to subsection 6.1(iv) is less than 4.00:1.00,
Company shall prepay the Loans and/or the Revolving Loan
Commitments shall be permanently reduced in an aggregate amount
equal to 50% of such Net Securities Proceeds.
(e) PREPAYMENTS AND REDUCTIONS FROM CONSOLIDATED EXCESS CASH
FLOW. In the event that there shall be Consolidated Excess Cash
Flow for any Fiscal Year (commencing with Fiscal Year 1999),
Company shall, no later than 90 days after the end of such Fiscal
Year, prepay the Loans and/or the Revolving Loan Commitments shall
be permanently reduced in an aggregate amount equal to 50% of such
Consolidated Excess Cash Flow.
(f) CALCULATIONS OF NET PROCEEDS AMOUNTS; ADDITIONAL
PREPAYMENTS AND REDUCTIONS BASED ON SUBSEQUENT CALCULATIONS.
Concurrently with any prepayment of the Loans and/or reduction of
the Revolving Loan Commitments pursuant to subsections
2.4B(iii)(a)-(e), Company shall deliver to Agent an Officers'
Certificate demonstrating the calculation of the amount (the "NET
PROCEEDS AMOUNT") of the applicable Unapplied Net Asset Sale
Proceeds or Net Insurance/Condemnation Proceeds, the applicable Net
Securities Proceeds (as such term is defined in subsection
2.4B(iii)(d)), or the applicable Consolidated Excess Cash Flow, as
the case may be, that gave rise to such prepayment and/or
reduction. In the event that Company shall subsequently determine
that the actual Net Proceeds Amount was greater than the amount set
forth in such Officers' Certificate, Company shall promptly make an
additional prepayment of the Loans (and/or, if applicable, the
Revolving Loan Commitments shall be permanently reduced) in an
amount equal to the amount of such excess, and Company shall
concurrently therewith deliver to Administrative Agent an Officers'
Certificate demonstrating the derivation of the additional Net
Proceeds Amount resulting in such excess.
(g) PREPAYMENTS DUE TO REDUCTIONS OR RESTRICTIONS OF
REVOLVING LOAN COMMITMENTS. Company shall from time to time prepay
first the Swing Line Loans and second the Revolving Loans to the
extent necessary so that the Total Utilization of Revolving Loan
Commitments shall not at any time exceed the Revolving Loan
Commitments then in effect.
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<PAGE> 59
(iv) APPLICATION OF PREPAYMENTS.
(a) APPLICATION OF VOLUNTARY PREPAYMENTS BY TYPE OF LOANS AND
ORDER OF MATURITY. Any voluntary prepayments pursuant to subsection
2.4B(i) shall be applied as specified by Company in the applicable
notice of prepayment; provided that in the event Company fails to
specify the Loans to which any such prepayment shall be applied,
such prepayment shall be applied first to repay outstanding Swing
Line Loans to the full extent thereof, second to repay outstanding
Revolving Loans to the full extent thereof, and third to repay
outstanding Term Loans to the full extent thereof. Any voluntary
prepayments of the Term Loans pursuant to subsection 2.4B(i)
(whether the application thereof is specified by Company or not)
shall be applied to prepay the Tranche A Term Loans and the Tranche
B Term Loans on a pro rata basis (in accordance with the respective
outstanding principal amounts thereof) and to reduce the scheduled
installments of principal of the Tranche A Term Loans and Tranche B
Term Loans set forth in subsections 2.4A(i) and 2.4A(ii) on a pro
rata basis.
(b) APPLICATION OF MANDATORY PREPAYMENTS BY TYPE OF LOANS.
Any amount (the "APPLIED AMOUNT") required to be applied as a
mandatory prepayment of the Loans and/or a reduction of the
Revolving Loan Commitments pursuant to subsections 2.4B(iii)(a)-(f)
shall be applied first to prepay the Term Loans to the full extent
thereof, second, to the extent of any remaining portion of the
Applied Amount, to prepay the Swing Line Loans to the full extent
thereof and to permanently reduce the Revolving Loan Commitments by
the amount of such prepayment, third, to the extent of any
remaining portion of the Applied Amount, to prepay the Revolving
Loans to the full extent thereof and to further permanently reduce
the Revolving Loan Commitments by the amount of such prepayment,
and fourth, to the extent of any remaining portion of the Applied
Amount, to further permanently reduce the Revolving Loan
Commitments to the full extent thereof.
(c) APPLICATION OF MANDATORY PREPAYMENTS OF TERM LOANS TO
TRANCHE A TERM LOANS AND TRANCHE B TERM LOANS AND THE SCHEDULED
INSTALLMENTS OF PRINCIPAL THEREOF.
(1) Any mandatory prepayments of the Term Loans pursuant
to subsection 2.4B(iii) shall be applied to prepay the
Tranche A Term Loans and the Tranche B Term Loans on a pro
rata basis in accordance with the respective outstanding
principal amounts thereof; PROVIDED that, in the case of any
such mandatory prepayment of the Tranche B Term Loans with
respect to which Company has given Administrative Agent
written notification, prior to Administrative Agent's receipt
of such mandatory prepayment, that Company has elected to
give Tranche B Term Loan Lenders the option to waive their
rights to receive such prepayment (a "WAIVABLE MANDATORY
PREPAYMENT"), Administrative Agent shall, upon receipt of
such Waivable Mandatory Prepayment, notify each Tranche B
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<PAGE> 60
Term Loan Lender of such receipt and of the amount of such
Waivable Mandatory Prepayment to be applied to such Lender's
Tranche B Term Loan and of the designation of such Waivable
Mandatory Prepayment as such by Company; PROVIDED, further
that Company shall use its reasonable efforts to notify
Tranche B Term Loan Lenders of such Waivable Mandatory
Prepayment three Business Days prior to the payment to
Administrative Agent of such Waivable Mandatory Prepayment
(it being understood that Company shall have no liability for
failing to so notify Tranche B Term Loan Lenders). In the
event any Tranche B Term Loan Lender desires to waive such
Lender's right to receive such Waivable Mandatory Prepayment,
(A) such Lender shall so advise Administrative Agent in
writing no later than the close of business on the date it
receives such notice from Administrative Agent and (B) upon
receipt of such written advice from such Lender,
Administrative Agent shall apply 100% of the amount so waived
by such Lender FIRST to prepay the Tranche A Term Loans to
the extent thereof and THEREAFTER, to the extent of any
excess, to repay the Revolving Loans and to permanently
reduce the Revolving Loan Commitments by the amount of such
repayment. Any mandatory prepayments applied to the Tranche A
Term Loans or the Tranche B Term Loans pursuant to this
subsection 2.4B(iv)(c)(1) shall be applied on a pro rata
basis (in accordance with the respective outstanding
principal amounts thereof) to each scheduled installment of
principal of the Tranche A Term Loans or the Tranche B Term
Loans, as the case may be, set forth in subsection 2.4A(i) or
2.4A(ii), respectively, that is unpaid at the time of such
prepayment.
(d) [intentionally omitted]
(e) APPLICATION OF PREPAYMENTS TO BASE RATE LOANS AND
EURODOLLAR RATE LOANS. Considering Tranche A Term Loans, Tranche B
Term Loans and Revolving Loans being prepaid separately, any
prepayment thereof shall be applied first to Base Rate Loans to the
full extent thereof before application to Eurodollar Rate Loans, in
each case in a manner which minimizes the amount of any payments
required to be made by Company pursuant to subsection 2.6D.
C. GENERAL PROVISIONS REGARDING PAYMENTS
(i) MANNER AND TIME OF PAYMENT. All payments by Company of
principal, interest, fees and other Obligations hereunder and under the
Notes shall be made in Dollars in same day funds, without defense,
setoff or counterclaim, free of any restriction or condition, and
delivered to Administrative Agent not later than 2:00 P.M. (Charlotte,
North Carolina time) on the date due at the Funding and Payment Office
for the account of Lenders; funds received by Administrative Agent
after that time on such due date shall be deemed to have been paid by
Company on the next succeeding Business Day.
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<PAGE> 61
(ii) APPLICATION OF PAYMENTS TO PRINCIPAL AND INTEREST. Except as
provided in subsection 2.2C, all payments in respect of the principal
amount of any Loan shall include payment of accrued interest on the
principal amount being repaid or prepaid, and all such payments (and,
in any event, any payments in respect of any Loan on a date when
interest is due and payable with respect to such Loan) shall be applied
to the payment of interest before application to principal.
(iii) APPORTIONMENT OF PAYMENTS. Aggregate principal and interest
payments in respect of Loans shall be apportioned among all outstanding
Loans to which such payments relate, in each case proportionately to
Lenders' respective Pro Rata Shares. Administrative Agent shall
promptly distribute to each Lender, at its primary address set forth
below its name on the appropriate signature page hereof or at such
other address as such Lender may request, its Pro Rata Share of all
such payments received by Administrative Agent and the commitment fees
of such Lender when received by Administrative Agent pursuant to
subsection 2.3. Notwithstanding the foregoing provisions of this
subsection 2.4C(iii), if, pursuant to the provisions of subsection
2.6C, any Notice of Conversion/Continuation is withdrawn as to any
Affected Lender or if any Affected Lender makes Base Rate Loans in lieu
of its Pro Rata Share of any Eurodollar Rate Loans, Administrative
Agent shall give effect thereto in apportioning payments received
thereafter.
(iv) PAYMENTS ON BUSINESS DAYS. Whenever any payment to be made
hereunder shall be stated to be due on a day that is not a Business
Day, such payment shall be made on the next succeeding Business Day and
such extension of time shall be included in the computation of the
payment of interest hereunder or of the commitment fees hereunder, as
the case may be.
(v) NOTATION OF PAYMENT. Each Lender agrees that before disposing
of any Note held by it, or any part thereof (other than by granting
participations therein), that Lender will make a notation thereon of
all Loans evidenced by that Note and all principal payments previously
made thereon and of the date to which interest thereon has been paid;
provided that the failure to make (or any error in the making of) a
notation of any Loan made under such Note shall not limit or otherwise
affect the obligations of Company hereunder or under such Note with
respect to any Loan or any payments of principal or interest on such
Note.
D. APPLICATION OF PROCEEDS OF COLLATERAL AND PAYMENTS UNDER
SUBSIDIARY GUARANTY
(i) APPLICATION OF PROCEEDS OF COLLATERAL. Except as provided in
subsection 2.4B(iii)(a) with respect to prepayments from Unapplied Net
Asset Sale Proceeds, all proceeds received by Administrative Agent in
respect of any sale of, collection from, or other realization upon all
or any part of the Collateral under any Collateral Document may, in the
discretion of Administrative Agent, be held by Administrative Agent as
Collateral for, and/or (then or at any time thereafter) applied in full
or in part by
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<PAGE> 62
Administrative Agent against, the applicable Secured Obligations (as
defined in such Collateral Document) in the following order of
priority:
(a) To the payment of all costs and expenses of such sale,
collection or other realization, including reasonable compensation
to Administrative Agent and its agents and counsel, and all other
expenses, liabilities and advances made or incurred by
Administrative Agent in connection therewith, and all amounts for
which Administrative Agent is entitled to indemnification under
such Collateral Document and all advances made by Administrative
Agent thereunder for the account of the applicable Loan Party, and
to the payment of all costs and expenses paid or incurred by
Administrative Agent in connection with the exercise of any right
or remedy under such Collateral Document, all in accordance with
the terms of this Agreement and such Collateral Document;
(b) thereafter, to the extent of any excess such proceeds, to
the payment of all other such Secured Obligations for the ratable
benefit of the holders thereof; and
(c) thereafter, to the extent of any excess such proceeds, to
the payment to or upon the order of such Loan Party or to whosoever
may be lawfully entitled to receive the same or as a court of
competent jurisdiction may direct.
(ii) APPLICATION OF PAYMENTS UNDER SUBSIDIARY GUARANTY. All
payments received by Administrative Agent under the Subsidiary Guaranty
shall be applied promptly from time to time by Administrative Agent in
the following order of priority:
(a) to the payment of the costs and expenses of any collection
or other realization under the Subsidiary Guaranty, including
reasonable compensation to Administrative Agent and its agents and
counsel, and all expenses, liabilities and advances made or
incurred by Administrative Agent in connection therewith, all in
accordance with the terms of this Agreement and the Subsidiary
Guaranty;
(b) thereafter, to the extent of any excess such payments, to
the payment of all other Guarantied Obligations (as defined in the
Subsidiary Guaranty) for the ratable benefit of the holders
thereof; and
(c) thereafter, to the extent of any excess such payments, to
the payment to the applicable Subsidiary Guarantor or to whosoever
may be lawfully entitled to receive the same or as a court of
competent jurisdiction may direct.
2.5 USE OF PROCEEDS
A. TERM LOANS. The proceeds of the Term Loans shall be applied by
Company to pay the Acquisition Financing Requirements.
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<PAGE> 63
B. REVOLVING LOANS; SWING LINE LOANS. The proceeds of the Revolving
Loans and any Swing Line Loans shall be applied by Company for general corporate
purposes, which may include the making of intercompany loans to any Subsidiary
to the extent permitted by subsection 7.1(iv), for their own general corporate
purposes, but shall not include any Acquisition Financing Requirements.
C. MARGIN REGULATIONS. No portion of the proceeds of any borrowing
under this Agreement shall be used by Company or any of its Subsidiaries in any
manner that might cause the borrowing or the application of such proceeds to
violate Regulation U, Regulation T or Regulation X of the Board of Governors of
the Federal Reserve System or any other regulation of such Board or to violate
the Exchange Act, in each case as in effect on the date or dates of such
borrowing and such use of proceeds.
2.6 SPECIAL PROVISIONS GOVERNING EURODOLLAR RATE LOANS
Notwithstanding any other provision of this Agreement to the
contrary, the following provisions shall govern with respect to Eurodollar Rate
Loans as to the matters covered:
A. DETERMINATION OF APPLICABLE INTEREST RATE. As soon as practicable
after 11:00 A.M. (Charlotte, North Carolina time) on each Interest Rate
Determination Date, Administrative Agent shall determine (which determination
shall, absent manifest error, be final, conclusive and binding upon all parties)
the interest rate that shall apply to the Eurodollar Rate Loans for which an
interest rate is then being determined for the applicable Interest Period and
shall promptly give notice thereof (in writing or by telephone confirmed in
writing) to Company and each Lender.
B. INABILITY TO DETERMINE APPLICABLE INTEREST RATE. In the event that
Administrative Agent shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date with respect to any Eurodollar Rate Loans, that by reason of
circumstances affecting the interbank Eurodollar market adequate and fair means
do not exist for ascertaining the interest rate applicable to such Loans on the
basis provided for in the definition of Adjusted Eurodollar Rate, Administrative
Agent shall on such date give notice (by telefacsimile or by telephone confirmed
in writing) to Company and each Lender of such determination, whereupon (i) no
Loans may be made as, or converted to, Eurodollar Rate Loans until such time as
Administrative Agent notifies Company and Lenders that the circumstances giving
rise to such notice no longer exist and (ii) any Notice of Borrowing or Notice
of Conversion/Continuation given by Company with respect to the Loans in respect
of which such determination was made shall be deemed to be rescinded by Company.
C. ILLEGALITY OR IMPRACTICABILITY OF EURODOLLAR RATE LOANS. In the
event that on any date any Lender shall have determined (which determination
shall be final and conclusive and binding upon all parties hereto but shall be
made only after consultation with Company and Administrative Agent) that the
making, maintaining or continuation of its Eurodollar Rate Loans (i) has become
unlawful as a result of compliance by such Lender in good faith with any law,
treaty, governmental rule, regulation, guideline or order (or would conflict
with any such treaty,
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<PAGE> 64
governmental rule, regulation, guideline or order not having the force of law
even though the failure to comply therewith would not be unlawful) or (ii) has
become impracticable, or would cause such Lender material hardship, as a result
of contingencies occurring after the date of this Agreement which materially and
adversely affect the interbank Eurodollar market or the position of such Lender
in that market, then, and in any such event, such Lender shall be an "AFFECTED
LENDER" and it shall on that day give notice (by telefacsimile or by telephone
confirmed in writing) to Company and Administrative Agent of such determination
(which notice Administrative Agent shall promptly transmit to each other
Lender). Thereafter (a) the obligation of the Affected Lender to make Loans as,
or to convert Loans to, Eurodollar Rate Loans shall be suspended until such
notice shall be withdrawn by the Affected Lender, (b) to the extent such
determination by the Affected Lender relates to a Eurodollar Rate Loan then
being requested by Company pursuant to a Notice of Borrowing or a Notice of
Conversion/Continuation, the Affected Lender shall make such Loan as (or convert
such Loan to, as the case may be) a Base Rate Loan, (c) the Affected Lender's
obligation to maintain its outstanding Eurodollar Rate Loans (the "AFFECTED
LOANS") shall be terminated at the earlier to occur of the expiration of the
Interest Period then in effect with respect to the Affected Loans or when
required by law, and (d) the Affected Loans shall automatically convert into
Base Rate Loans on the date of such termination. Notwithstanding the foregoing,
to the extent a determination by an Affected Lender as described above relates
to a Eurodollar Rate Loan then being requested by Company pursuant to a Notice
of Borrowing or a Notice of Conversion/Continuation, Company shall have the
option, subject to the provisions of subsection 2.6D, to rescind such Notice of
Borrowing or Notice of Conversion/Continuation as to all Lenders by giving
notice (by telefacsimile or by telephone confirmed in writing) to Administrative
Agent of such rescission on the date on which the Affected Lender gives notice
of its determination as described above (which notice of rescission
Administrative Agent shall promptly transmit to each other Lender). Except as
provided in the immediately preceding sentence, nothing in this subsection 2.6C
shall affect the obligation of any Lender other than an Affected Lender to make
or maintain Loans as, or to convert Loans to, Eurodollar Rate Loans in
accordance with the terms of this Agreement.
D. COMPENSATION FOR BREAKAGE OR NON-COMMENCEMENT OF INTEREST PERIODS.
Company shall compensate each Lender, upon written request by that Lender (which
request shall set forth the basis for requesting such amounts), for all
reasonable losses, expenses and liabilities (including any interest paid by that
Lender to lenders of funds borrowed by it to make or carry its Eurodollar Rate
Loans and any loss, expense or liability sustained by that Lender in connection
with the liquidation or re-employment of such funds, but excluding loss of
margin on such funds) which that Lender may sustain: (i) if for any reason
(other than a default by that Lender) a borrowing of any Eurodollar Rate Loan
does not occur on a date specified therefor in a Notice of Borrowing or a
telephonic request for borrowing, or a conversion to or continuation of any
Eurodollar Rate Loan does not occur on a date specified therefor in a Notice of
Conversion/Continuation or a telephonic request for conversion or continuation,
(ii) if any prepayment (including any prepayment pursuant to subsection 2.4B(i))
or other principal payment or any conversion of any of its Eurodollar Rate Loans
occurs on a date prior to the last day of an Interest Period applicable to that
Loan, (iii) if any prepayment of any of its Eurodollar Rate Loans is not made on
any date specified in a notice of prepayment given by Company, or (iv) as a
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consequence of any other default by Company in the repayment of its Eurodollar
Rate Loans when required by the terms of this Agreement.
E. BOOKING OF EURODOLLAR RATE LOANS. Any Lender may make, carry or
transfer Eurodollar Rate Loans at, to, or for the account of any of its branch
offices or the office of an Affiliate of that Lender.
F. ASSUMPTIONS CONCERNING FUNDING OF EURODOLLAR RATE LOANS. Calculation
of all amounts payable to a Lender under this subsection 2.6 and under
subsection 2.7A shall be made as though that Lender had actually funded each of
its relevant Eurodollar Rate Loans through the purchase of a Eurodollar deposit
bearing interest at the rate obtained pursuant to clause (i) of the definition
of Adjusted Eurodollar Rate in an amount equal to the amount of such Eurodollar
Rate Loan and having a maturity comparable to the relevant Interest Period and
through the transfer of such Eurodollar deposit from an offshore office of that
Lender to a domestic office of that Lender in the United States of America;
provided, however, that each Lender may fund each of its Eurodollar Rate Loans
in any manner it sees fit and the foregoing assumptions shall be utilized only
for the purposes of calculating amounts payable under this subsection 2.6 and
under subsection 2.7A.
G. EURODOLLAR RATE LOANS AFTER DEFAULT. After the occurrence of and
during the continuation of a Potential Event of Default or an Event of Default,
(i) Company may not elect to have a Loan be made or maintained as, or converted
to, a Eurodollar Rate Loan after the expiration of any Interest Period then in
effect for that Loan and (ii) subject to the provisions of subsection 2.6D, any
Notice of Borrowing or Notice of Conversion/Continuation given by Company with
respect to a requested borrowing or conversion/continuation that has not yet
occurred shall be deemed to be rescinded by Company.
2.7 INCREASED COSTS; TAXES; CAPITAL ADEQUACY
A. COMPENSATION FOR INCREASED COSTS AND TAXES. Subject to the
provisions of subsection 2.7B (which shall be controlling with respect to the
matters covered thereby), in the event that any Lender shall determine (which
determination shall, absent manifest error, be final and conclusive and binding
upon all parties hereto) that any law, treaty or governmental rule, regulation
or order, or any change therein or in the interpretation, administration or
application thereof (including the introduction of any new law, treaty or
governmental rule, regulation or order), or any determination of a court or
governmental authority, in each case that becomes effective after the date
hereof, or compliance by such Lender with any guideline, request or directive
issued or made after the date hereof by any central bank or other governmental
or quasi-governmental authority (whether or not having the force of law):
(i) subjects such Lender (or its applicable lending office) to any
additional Tax (other than any Tax on the overall net income of such
Lender) with respect to this Agreement or any of its obligations
hereunder or any payments to such Lender (or its applicable lending
office) of principal, interest, fees or any other amount payable
hereunder;
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(ii) imposes, modifies or holds applicable any reserve (including
any marginal, emergency, supplemental, special or other reserve),
special deposit, compulsory loan, FDIC insurance or similar requirement
against assets held by, or deposits or other liabilities in or for the
account of, or advances or loans by, or other credit extended by, or
any other acquisition of funds by, any office of such Lender (other
than any such reserve or other requirements with respect to Eurodollar
Rate Loans that are reflected in the definition of Adjusted Eurodollar
Rate); or
(iii) imposes any other condition (other than with respect to a Tax
matter) on or affecting such Lender (or its applicable lending office)
or its obligations hereunder or the interbank Eurodollar market;
and the result of any of the foregoing is to increase the cost to such Lender of
agreeing to make, making or maintaining Loans hereunder or to reduce any amount
received or receivable by such Lender (or its applicable lending office) with
respect thereto; then, in any such case, Company shall promptly pay to such
Lender, upon receipt of the statement referred to in the next sentence, such
additional amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as may be necessary to compensate such Lender
for any such increased cost or reduction in amounts received or receivable
hereunder. Such Lender shall deliver to Company (with a copy to Administrative
Agent) a written statement, setting forth in reasonable detail the basis for
calculating the additional amounts owed to such Lender under this subsection
2.7A, which statement shall be conclusive and binding upon all parties hereto
absent manifest error.
B. WITHHOLDING OF TAXES.
(i) PAYMENTS TO BE FREE AND CLEAR. All sums payable by Company under
this Agreement and the other Loan Documents shall (except to the extent
required by law) be paid free and clear of, and without any deduction
or withholding on account of, any Tax (other than a Tax on the overall
net income of any Lender) imposed, levied, collected, withheld or
assessed by or within the United States of America or any political
subdivision in or of the United States of America or any other
jurisdiction from or to which a payment is made by or on behalf of
Company or by any federation or organization of which the United States
of America or any such jurisdiction is a member at the time of payment.
(ii) GROSSING-UP OF PAYMENTS. If Company or any other Person is
required by law to make any deduction or withholding on account of any
such Tax from any sum paid or payable by Company to Administrative
Agent or any Lender under any of the Loan Documents:
(a) Company shall notify Administrative Agent of any such
requirement or any change in any such requirement as soon as Company
becomes aware of it;
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(b) Company shall pay any such Tax before the date on which
penalties attach thereto, such payment to be made (if the liability
to pay is imposed on Company) for its own account or (if that
liability is imposed on Administrative Agent or such Lender, as the
case may be) on behalf of and in the name of Administrative Agent or
such Lender;
(c) the sum payable by Company in respect of which the relevant
deduction, withholding or payment is required shall be increased to
the extent necessary to ensure that, after the making of that
deduction, withholding or payment, Administrative Agent or such
Lender, as the case may be, receives on the due date a net sum equal
to what it would have received had no such deduction, withholding or
payment been required or made; and
(d) within 30 days after paying any sum from which it is
required by law to make any deduction or withholding, and within 30
days after the due date of payment of any Tax which it is required
by clause (b) above to pay, Company shall deliver to Administrative
Agent evidence satisfactory to the other affected parties of such
deduction, withholding or payment and of the remittance thereof to
the relevant taxing or other authority;
PROVIDED that no such additional amount shall be required to be paid to any
Lender under clause (c) above except to the extent that any change after the
date hereof (in the case of each Lender listed on the signature pages hereof) or
after the date of the Assignment Agreement pursuant to which such Lender became
a Lender (in the case of each other Lender) in any such requirement for a
deduction, withholding or payment as is mentioned therein shall result in an
increase in the rate of such deduction, withholding or payment from that in
effect at the date of this Agreement or at the date of such Assignment
Agreement, as the case may be, in respect of payments to such Lender.
(iii) Evidence of Exemption from U.S. Withholding Tax.
(a) Each Lender that is organized under the laws of any
jurisdiction other than the United States or any state or other
political subdivision thereof (for purposes of this subsection
2.7B(iii), a "NON-US LENDER") shall deliver to Administrative Agent
for transmission to Company, on or prior to the Closing Date (in the
case of each Lender listed on the signature pages hereof) or on or
prior to the date of the Assignment Agreement pursuant to which it
becomes a Lender (in the case of each other Lender), and at such
other times as may be necessary in the determination of Company or
Administrative Agent (each in the reasonable exercise of its
discretion), (1) two original copies of Internal Revenue Service
Form 1001 or 4224 (or any successor forms), properly completed and
duly executed by such Lender, together with any other certificate or
statement of exemption required under the Internal Revenue Code or
the regulations issued thereunder to establish that such Lender is
not subject to deduction or withholding of United States federal
income tax with respect to any payments to such Lender
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of principal, interest, fees or other amounts payable under any of
the Loan Documents or (2) if such Lender is not a "bank" or other
Person described in Section 881(c)(3) of the Internal Revenue Code
and cannot deliver either Internal Revenue Service Form 1001 or 4224
pursuant to clause (1) above, a Certificate re Non-Bank Status
together with two original copies of Internal Revenue Service Form
W-8 (or any successor form), properly completed and duly executed by
such Lender, together with any other certificate or statement of
exemption required under the Internal Revenue Code or the
regulations issued thereunder to establish that such Lender is not
subject to deduction or withholding of United States federal income
tax with respect to any payments to such Lender of interest payable
under any of the Loan Documents.
(b) Each Lender required to deliver any forms, certificates or
other evidence with respect to United States federal income tax
withholding matters pursuant to subsection 2.7B(iii)(a) hereby
agrees, from time to time after the initial delivery by such Lender
of such forms, certificates or other evidence, whenever a lapse in
time or change in circumstances renders such forms, certificates or
other evidence obsolete or inaccurate in any material respect, that
such Lender shall promptly (1) deliver to Administrative Agent for
transmission to Company two new original copies of Internal Revenue
Service Form 1001 or 4224, or a Certificate re Non-Bank Status and
two original copies of Internal Revenue Service Form W-8, as the
case may be, properly completed and duly executed by such Lender,
together with any other certificate or statement of exemption
required in order to confirm or establish that such Lender is not
subject to deduction or withholding of United States federal income
tax with respect to payments to such Lender under the Loan Documents
or (2) notify Administrative Agent and Company of its inability to
deliver any such forms, certificates or other evidence.
(c) Company shall not be required to pay any additional amount
to any Non-US Lender under clause (c) of subsection 2.7B(ii) if such
Lender shall have failed to satisfy the requirements of clause (a)
or (b)(1) of this subsection 2.7B(iii); provided that if such Lender
shall have satisfied the requirements of subsection 2.7B(iii)(a) on
the Closing Date (in the case of each Lender listed on the signature
pages hereof) or on the date of the Assignment Agreement pursuant to
which it became a Lender (in the case of each other Lender), nothing
in this subsection 2.7B(iii)(c) shall relieve Company of its
obligation to pay any additional amounts pursuant to clause (c) of
subsection 2.7B(ii) in the event that, as a result of any change in
any applicable law, treaty or governmental rule, regulation or
order, or any change in the interpretation, administration or
application thereof, such Lender is no longer properly entitled to
deliver forms, certificates or other evidence at a subsequent date
establishing the fact that such Lender is not subject to withholding
as described in subsection 2.7B(iii)(a).
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C. CAPITAL ADEQUACY ADJUSTMENT. If any Lender shall have determined
that the adoption, effectiveness, phase-in or applicability after the date
hereof of any law, rule or regulation (or any provision thereof) regarding
capital adequacy, or any change therein or in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender (or its applicable lending office) with any guideline, request or
directive regarding capital adequacy (whether or not having the force of law) of
any such governmental authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on the capital of such Lender or
any corporation controlling such Lender as a consequence of, or with reference
to, such Lender's Loans or Commitments or Letters of Credit or participations
therein or other obligations hereunder with respect to the Loans or the Letters
of Credit to a level below that which such Lender or such controlling
corporation could have achieved but for such adoption, effectiveness, phase-in,
applicability, change or compliance (taking into consideration the policies of
such Lender or such controlling corporation with regard to capital adequacy),
then from time to time, within five Business Days after receipt by Company from
such Lender of the statement referred to in the next sentence, Company shall pay
to such Lender such additional amount or amounts as will compensate such Lender
or such controlling corporation on an after-tax basis for such reduction. Such
Lender shall deliver to Company (with a copy to Administrative Agent) a written
statement, setting forth in reasonable detail the basis of the calculation of
such additional amounts, which statement shall be conclusive and binding upon
all parties hereto absent manifest error.
2.8 OBLIGATION OF LENDERS AND ISSUING LENDERS TO MITIGATE; REPLACEMENT OF
LENDERS
A. MITIGATION. Each Lender and Issuing Lender agrees that, as promptly
as practicable after the officer of such Lender or Issuing Lender responsible
for administering the Loans or Letters of Credit of such Lender or Issuing
Lender, as the case may be, becomes aware of the occurrence of an event or the
existence of a condition that would cause such Lender to become an Affected
Lender or that would entitle such Lender or Issuing Lender to receive payments
under subsection 2.7 or subsection 3.6, it will, to the extent not inconsistent
with the internal policies of such Lender or Issuing Lender and any applicable
legal or regulatory restrictions, use reasonable efforts (i) to make, issue,
fund or maintain the Commitments of such Lender or the affected Loans or Letters
of Credit of such Lender or Issuing Lender through another lending or letter of
credit office of such Lender or Issuing Lender, or (ii) take such other measures
as such Lender or Issuing Lender may deem reasonable, if as a result thereof the
circumstances which would cause such Lender to be an Affected Lender would cease
to exist or the additional amounts which would otherwise be required to be paid
to such Lender or Issuing Lender pursuant to subsection 2.7 or subsection 3.6
would be materially reduced and if, as determined by such Lender or Issuing
Lender in its sole discretion, the making, issuing, funding or maintaining of
such Commitments or Loans or Letters of Credit through such other lending or
letter of credit office or in accordance with such other measures, as the case
may be, would not otherwise materially adversely affect such Commitments or
Loans or Letters of Credit or the interests of such Lender or Issuing Lender;
PROVIDED that such Lender or Issuing Lender will not be obligated to utilize
such other lending or letter of credit office pursuant to this subsection 2.8
unless Company agrees to pay all incremental expenses incurred by such Lender or
Issuing Lender
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as a result of utilizing such other lending or letter of credit office as
described in clause (i) above. A certificate as to the amount of any such
expenses payable by Company pursuant to this subsection 2.8 (setting forth in
reasonable detail the basis for requesting such amount) submitted by such Lender
or Issuing Lender to Company (with a copy to Administrative Agent) shall be
conclusive absent manifest error.
B. REPLACEMENT OF LENDER. If Company receives a notice of amounts due
pursuant to subsection 2.7A, subsection 2.7B or subsection 2.7C from a Lender, a
Lender defaults in its obligations hereunder or a Lender becomes an Affected
Lender (any such Lender, a "Subject Lender"), so long as (i) no Potential Event
of Default or Event of Default shall have occurred and be continuing and Company
has obtained a commitment from another Lender or an Eligible Assignee to
purchase at par the Subject Lender's Loans and assume the Subject Lender's
Commitments and all other obligations of the Subject Lender hereunder, (ii) such
Lender is not an Issuing Lender with respect to any Letters of Credit
outstanding (unless all such Letters of Credit are terminated or arrangements
acceptable to such Issuing Lender (such as a "Back-to-Back" letter of credit)
are made) and (iii) the Subject Lender is unwilling to withdraw the notice
delivered to Company pursuant to subsections 2.7A, 2.7B or 2.7C, is unwilling to
remedy its default and/or remains an Affected Lender, upon the 10 days prior
written notice to the Subject Lender and Administrative Agent, Company may
require the Subject Lender to assign all of its Loans and Commitments to such
other Lender as Eligible Assignee pursuant to the provisions of subsection
10.1B; provided that, prior to or concurrently with such replacement (i) Company
has paid to the Lender giving such notice all amounts under subsections 2.6D and
2.7 (if applicable) through such date of replacement, (ii) Company or the
applicable assignee have paid to Administrative Agent the processing fee
required to be paid by subsection 10.1B(i) and (iii) all of the requirements for
such assignment contained in subsection 10.1B, including, without limitation,
the consent of Administrative Agent (if required) and the receipt by
Administrative Agent of an executed Assignment Agreement and other supporting
documents, have been fulfilled.
SECTION 3. LETTERS OF CREDIT
3.1 ISSUANCE OF LETTERS OF CREDIT AND LENDERS' PURCHASE OF PARTICIPATIONS
THEREIN
A. LETTERS OF CREDIT. In addition to Company requesting that Revolving
Loan Lenders make Revolving Loans pursuant to subsection 2.1A(iii) and that
Swing Line Lender make Swing Line Loans pursuant to subsection 2.1A(iv), Company
may request, in accordance with the provisions of this subsection 3.1, from time
to time during the period from the Closing Date to but excluding the Revolving
Loan Commitment Termination Date, that one or more Revolving Loan Lenders issue
Letters of Credit for the account of Company for the purposes specified in the
definitions of Commercial Letters of Credit and Standby Letters of Credit.
Subject to the terms and conditions of this Agreement and in reliance upon the
representations and warranties of Company herein set forth, any one or more
Revolving Loan Lenders may, but (except as provided in subsection 3.1B(ii))
shall not be obligated to, issue such Letters of Credit in accordance with the
provisions of this subsection 3.1; provided that Company shall not request that
any Revolving Loan Lender issue (and no Revolving Loan Lender shall issue):
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(i) any Letter of Credit if, after giving effect to such issuance,
the Total Utilization of Revolving Loan Commitments would exceed the
Revolving Loan Commitments then in effect;
(ii) any Letter of Credit if, after giving effect to such issuance,
the Letter of Credit Usage would exceed $5,000,000;
(iii) [intentionally omitted];
(iv) [intentionally omitted];
(v) any Standby Letter of Credit having an expiration date later
than the earlier of (a) the Revolving Loan Commitment Termination Date
and (b) the date which is one year from the date of issuance of such
Standby Letter of Credit; provided that the immediately preceding
clause (b) shall not prevent any Issuing Lender from agreeing that a
Standby Letter of Credit will automatically be extended for one or more
successive periods not to exceed one year each unless such Issuing
Lender elects not to extend for any such additional period; and
provided, further that such Issuing Lender shall elect not to extend
such Standby Letter of Credit if it has knowledge that an Event of
Default has occurred and is continuing (and has not been waived in
accordance with subsection 10.6) at the time such Issuing Lender must
elect whether or not to allow such extension; or
(vi) any Commercial Letter of Credit having an expiration date (a)
later than the earlier of (X) the Revolving Loan Commitment Termination
Date and (Y) the date which is 180 days from the date of issuance of
such Commercial Letter of Credit or (b) that is otherwise unacceptable
to the applicable Issuing Lender in its reasonable discretion; or
(vii) any Letter of Credit denominated in a currency other than
Dollars.
B. MECHANICS OF ISSUANCE.
(i) NOTICE OF ISSUANCE. Whenever Company desires the issuance of a
Letter of Credit, it shall deliver to Administrative Agent a Notice of
Issuance of Letter of Credit substantially in the form of Exhibit III
annexed hereto no later than 11:00 A.M. (Charlotte, North Carolina
time) at least three Business Days (in the case of Standby Letters of
Credit) or five Business Days (in the case of Commercial Letters of
Credit), or in each case such shorter period as may be agreed to by the
Issuing Lender in any particular instance, in advance of the proposed
date of issuance. The Notice of Issuance of Letter of Credit shall
specify (a) the proposed date of issuance (which shall be a Business
Day), (b) whether the Letter of Credit is to be a Standby Letter of
Credit or a Commercial Letter of Credit, (c) the face amount of the
Letter of Credit, (d) [intentionally omitted], (e) the expiration date
of the Letter of Credit, (f) the name and address of the beneficiary,
and (g) either the verbatim text of the proposed Letter of Credit or
the proposed terms and conditions thereof, including a precise
description of any documents to be presented by the
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beneficiary which, if presented by the beneficiary prior to the
expiration date of the Letter of Credit, would require the Issuing
Lender to make payment under the Letter of Credit; provided that the
Issuing Lender, in its reasonable discretion, may require changes in
the text of the proposed Letter of Credit or any such documents; and
provided, further that no Letter of Credit shall require payment
against a conforming draft to be made thereunder on the same business
day (under the laws of the jurisdiction in which the office of the
Issuing Lender to which such draft is required to be presented is
located) that such draft is presented if such presentation is made
after 10:00 A.M. (in the time zone of such office of the Issuing
Lender) on such business day.
Company shall notify the applicable Issuing Lender (and
Administrative Agent, if Administrative Agent is not such Issuing
Lender) prior to the issuance of any Letter of Credit in the event that
any of the matters to which Company is required to certify in the
applicable Notice of Issuance of Letter of Credit is no longer true and
correct as of the proposed date of issuance of such Letter of Credit,
and upon the issuance of any Letter of Credit Company shall be deemed
to have re-certified, as of the date of such issuance, as to the
matters to which Company is required to certify in the applicable
Notice of Issuance of Letter of Credit.
(ii) DETERMINATION OF ISSUING LENDER. Upon receipt by Administrative
Agent of a Notice of Issuance of Letter of Credit pursuant to
subsection 3.1B(i) requesting the issuance of a Letter of Credit, in
the event Administrative Agent elects to issue such Letter of Credit,
Administrative Agent shall promptly so notify Company, and
Administrative Agent shall be the Issuing Lender with respect thereto.
In the event that Administrative Agent, in its sole discretion, elects
not to issue such Letter of Credit, Administrative Agent shall promptly
so notify Company, whereupon Company may request any other Revolving
Loan Lender to issue such Letter of Credit by delivering to such
Revolving Loan Lender a copy of the applicable Notice of Issuance of
Letter of Credit. Any Revolving Loan Lender so requested to issue such
Letter of Credit shall promptly notify Company and Administrative Agent
whether or not, in its sole discretion, it has elected to issue such
Letter of Credit, and any such Lender which so elects to issue such
Letter of Credit shall be the Issuing Lender with respect thereto. In
the event that all other Revolving Loan Lenders shall have declined to
issue such Letter of Credit, notwithstanding the prior election of
Administrative Agent not to issue such Letter of Credit, Administrative
Agent shall be obligated to issue such Letter of Credit and shall be
the Issuing Lender with respect thereto, notwithstanding the fact that
the Letter of Credit Usage with respect to such Letter of Credit and
with respect to all other Letters of Credit issued by Administrative
Agent, when aggregated with Administrative Agent's outstanding
Revolving Loans and Swing Line Loans, may exceed Administrative Agent's
Revolving Loan Commitment then in effect.
(iii) ISSUANCE OF LETTER OF CREDIT. Upon satisfaction or waiver (in
accordance with subsection 10.6) of the conditions set forth in
subsection 4.4, the Issuing Lender shall issue the requested Letter of
Credit in accordance with the Issuing Lender's standard operating
procedures.
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(iv) NOTIFICATION TO REVOLVING LOAN LENDERS. Upon the issuance of
any Letter of Credit the applicable Issuing Lender shall promptly
notify Administrative Agent and each other Revolving Loan Lender of
such issuance, which notice shall be accompanied by a copy of such
Letter of Credit. Promptly after receipt of such notice (or, if
Administrative Agent is the Issuing Lender, together with such notice),
Administrative Agent shall notify each Revolving Loan Lender of the
amount of such Lender's respective participation in such Letter of
Credit, determined in accordance with subsection 3.1C.
(v) REPORTS TO LENDERS. Within 15 days after the end of each
calendar quarter ending after the Closing Date, so long as any Letter
of Credit shall have been outstanding during such calendar quarter,
each Issuing Lender shall deliver to Administrative Agent, for
distribution to each other Revolving Loan Lender, a report setting
forth for such calendar quarter the daily aggregate amount available to
be drawn under the Letters of Credit issued by such Issuing Lender that
were outstanding during such calendar quarter.
C. REVOLVING LOAN LENDERS' PURCHASE OF PARTICIPATIONS IN LETTERS OF
CREDIT. Immediately upon the issuance of each Letter of Credit, each Revolving
Loan Lender shall be deemed to, and hereby agrees to, have irrevocably purchased
from the Issuing Lender a participation in such Letter of Credit and any
drawings honored thereunder in an amount equal to such Revolving Loan Lender's
Pro Rata Share of the maximum amount which is or at any time may become
available to be drawn thereunder.
3.2 LETTER OF CREDIT FEES
Company agrees to pay the following amounts with respect to Letters
of Credit issued hereunder:
(i) with respect to each Letter of Credit, (a) a fronting fee,
payable directly to the applicable Issuing Lender for its own account,
equal to 0.25% per annum of the daily amount available to be drawn
under such Letter of Credit and (b) a letter of credit fee, payable to
Agent for the account of Lenders, equal to the Applicable Eurodollar
Rate Margin, stated as a percentage per annum, of the daily amount
available to be drawn under such Letter of Credit, each such fronting
fee or letter of credit fee to be payable in arrears on and to (but
excluding) each March 31, June 30, September 30 and December 31 of each
year and computed on the basis of a 360-day year for the actual number
of days elapsed;
(ii) [intentionally omitted]; and
(iii) with respect to the issuance, amendment or transfer of each
Letter of Credit and each payment of a drawing made thereunder (without
duplication of the fees payable under clause (i) above), documentary
and processing charges payable directly to the applicable Issuing
Lender for its own account in accordance with such Issuing Lender's
standard schedule for such charges in effect at the time of such
issuance, amendment, transfer or payment, as the case may be.
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For purposes of calculating any fees payable under clause (i) of this subsection
3.2, the daily amount available to be drawn under any Letter of Credit shall be
determined as of the close of business on any date of determination. Promptly
upon receipt by Administrative Agent of any amount described in clause (i)(b) of
this subsection 3.2, Administrative Agent shall distribute to each Revolving
Loan Lender its Pro Rata Share of such amount.
3.3. DRAWINGS AND REIMBURSEMENT OF AMOUNTS PAID UNDER LETTERS OF CREDIT.
A. RESPONSIBILITY OF ISSUING LENDER WITH RESPECT TO DRAWINGS. In
determining whether to honor any drawing under any Letter of Credit by the
beneficiary thereof, the Issuing Lender shall be responsible only to examine the
documents delivered under such Letter of Credit with reasonable care so as to
ascertain whether they appear on their face to be in accordance with the terms
and conditions of such Letter of Credit.
B. REIMBURSEMENT BY COMPANY OF AMOUNTS PAID UNDER LETTERS OF CREDIT. In
the event an Issuing Lender has determined to honor a drawing under a Letter of
Credit issued by it, such Issuing Lender shall immediately notify Company and
Administrative Agent, and Company shall reimburse such Issuing Lender on or
before the Business Day immediately following the date on which such drawing is
honored (the "Reimbursement Date") in an amount in Dollars and in same day funds
equal to the amount of such honored drawing; PROVIDED that, anything contained
in this Agreement to the contrary notwithstanding, (i) unless Company shall have
notified Administrative Agent and such Issuing Lender prior to 11:00 A.M.
(Charlotte, North Carolina time) on the date such drawing is honored that
Company intends to reimburse such Issuing Lender for the amount of such honored
drawing with funds other than the proceeds of Revolving Loan Loans, Company
shall be deemed to have given a timely Notice of Borrowing to Administrative
Agent requesting Lenders to make Revolving Loan Loans that are Base Rate Loans
on the Reimbursement Date in an amount in Dollars equal to the amount of such
honored drawing and (ii) subject to satisfaction or waiver of the conditions
specified in subsection 4.2B, Revolving Loan Lenders shall, on the Reimbursement
Date, make Revolving Loan Loans that are Base Rate Loans in the amount of such
honored drawing, the proceeds of which shall be applied directly by
Administrative Agent to reimburse such Issuing Lender for the amount of such
honored drawing; and PROVIDED, FURTHER that if for any reason proceeds of
Revolving Loans are not received by such Issuing Lender on the Reimbursement
Date in an amount equal to the amount of such honored drawing, Company shall
reimburse such Issuing Lender, on demand, in an amount in same day funds equal
to the excess of the amount of such honored drawing over the aggregate amount of
such Revolving Loans, if any, which are so received. Nothing in this subsection
3.3B shall be deemed to relieve any Revolving Loan Lender from its obligation to
make Revolving Loans on the terms and conditions set forth in this Agreement,
and Company shall retain any and all rights it may have against any Revolving
Loan Lender resulting from the failure of such Lender to make such Revolving
Loans under this subsection 3.3B.
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C. PAYMENT BY REVOLVING LOAN LENDERS OF UNREIMBURSED AMOUNTS PAID UNDER
LETTERS OF CREDIT.
(i) PAYMENT BY REVOLVING LOAN LENDERS. In the event that Company
shall fail for any reason to reimburse any Issuing Lender as provided
in subsection 3.3B in an amount equal to the amount of any drawing
honored by such Issuing Lender under a Letter of Credit issued by it,
such Issuing Lender shall promptly notify each other Revolving Loan
Lender of the unreimbursed amount of such honored drawing and of such
other Revolving Loan Lender's respective participation therein based on
such Revolving Loan Lender's Pro Rata Share. Each Revolving Loan Lender
shall make available to such Issuing Lender an amount equal to its
respective participation, in Dollars and in same day funds, at the
office of such Issuing Lender specified in such notice, not later than
1:00 P.M. (Charlotte, North Carolina time) on the first business day
(under the laws of the jurisdiction in which such office of such
Issuing Lender is located) after the date notified by such Issuing
Lender. In the event that any Revolving Loan Lender fails to make
available to such Issuing Lender on such business day the amount of
such Revolving Loan Lender's participation in such Letter of Credit as
provided in this subsection 3.3C, such Issuing Lender shall be entitled
to recover such amount on demand from such Revolving Loan Lender
together with interest thereon at the Federal Funds Effective Rate for
three Business Days and thereafter at the Base Rate. Nothing in this
subsection 3.3C shall be deemed to prejudice the right of any Revolving
Loan Lender to recover from any Issuing Lender any amounts made
available by such Revolving Loan Lender to such Issuing Lender pursuant
to this subsection 3.3C in the event that it is determined by the final
judgment of a court of competent jurisdiction that the payment with
respect to a Letter of Credit by such Issuing Lender in respect of
which payment was made by such Revolving Loan Lender constituted gross
negligence or willful misconduct on the part of such Issuing Lender.
(ii) DISTRIBUTION TO REVOLVING LOAN LENDERS OF REIMBURSEMENTS
RECEIVED FROM COMPANY. In the event any Issuing Lender shall have been
reimbursed by other Revolving Loan Lenders pursuant to subsection
3.3C(i) for all or any portion of any drawing honored by such Issuing
Lender under a Letter of Credit issued by it, such Issuing Lender shall
distribute to each other Revolving Loan Lender which has paid all
amounts payable by it under subsection 3.3C(i) with respect to such
honored drawing such other Revolving Loan Lender's Pro Rata Share of
all payments subsequently received by such Issuing Lender from Company
in reimbursement of such honored drawing when such payments are
received. Any such distribution shall be made to a Revolving Loan
Lender at its primary address set forth below its name on the
appropriate signature page hereof or at such other address as such
Revolving Loan Lender may request.
D. INTEREST ON AMOUNTS PAID UNDER LETTERS OF CREDIT.
(i) PAYMENT OF INTEREST BY COMPANY. Company agrees to pay to each
Issuing Lender, with respect to drawings honored under any Letters of
Credit issued by it, interest on the amount paid by such Issuing Lender
in respect of each such honored drawing from
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the date such drawing is honored to but excluding the date such amount
is reimbursed by Company (including any such reimbursement out of the
proceeds of Revolving Loans pursuant to subsection 3.3B) at a rate
equal to (a) for the period from the date such drawing is honored to
but excluding the Reimbursement Date, the rate then in effect under
this Agreement with respect to Revolving Loans that are Base Rate Loans
and (b) thereafter, a rate which is 2% per annum in excess of the rate
of interest otherwise payable under this Agreement with respect to
Revolving Loans that are Base Rate Loans. Interest payable pursuant to
this subsection 3.3D(i) shall be computed on the basis of a 360-day
year for the actual number of days elapsed in the period during which
it accrues and shall be payable on demand or, if no demand is made, on
the date on which the related drawing under a Letter of Credit is
reimbursed in full.
(ii) DISTRIBUTION OF INTEREST PAYMENTS BY ISSUING LENDER. Promptly
upon receipt by any Issuing Lender of any payment of interest pursuant
to subsection 3.3D(i) with respect to a drawing honored under a Letter
of Credit issued by it, (a) such Issuing Lender shall distribute to
each other Revolving Loan Lender, out of the interest received by such
Issuing Lender in respect of the period from the date such drawing is
honored to but excluding the date on which such Issuing Lender is
reimbursed for the amount of such drawing (including any such
reimbursement out of the proceeds of Revolving Loans pursuant to
subsection 3.3B), the amount that such other Revolving Loan Lender
would have been entitled to receive in respect of the letter of credit
fee that would have been payable in respect of such Letter of Credit
for such period pursuant to subsection 3.2 if no drawing had been
honored under such Letter of Credit, and (b) in the event such Issuing
Lender shall have been reimbursed by other Revolving Loan Lenders
pursuant to subsection 3.3C(i) for all or any portion of such honored
drawing, such Issuing Lender shall distribute to each other Revolving
Loan Lender which has paid all amounts payable by it under subsection
3.3C(i) with respect to such honored drawing such other Revolving Loan
Lender's Pro Rata Share of any interest received by such Issuing Lender
in respect of that portion of such honored drawing so reimbursed by
other Revolving Loan Lenders for the period from the date on which such
Issuing Lender was so reimbursed by other Revolving Loan Lenders to but
excluding the date on which such portion of such honored drawing is
reimbursed by Company. Any such distribution shall be made to a
Revolving Loan Lender at its primary address set forth below its name
on the appropriate signature page hereof or at such other address as
such Revolving Loan Lender may request.
3.4 OBLIGATIONS ABSOLUTE.
The obligation of Company to reimburse each Issuing Lender for
drawings honored under the Letters of Credit issued by it and to repay any
Revolving Loans made by Revolving Loan Lenders pursuant to subsection 3.3B and
the obligations of Revolving Loan Lenders under subsection 3.3C(i) shall be
unconditional and irrevocable and shall be paid strictly in accordance with the
terms of this Agreement under all circumstances including any of the following
circumstances:
(i) any lack of validity or enforceability of any Letter of
Credit;
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(ii) the existence of any claim, set-off, defense or other
right which Company or any Revolving Loan Lender may have at any
time against a beneficiary or any transferee of any Letter of Credit
(or any Persons for whom any such transferee may be acting), any
Issuing Lender or other Lender or any other Person or, in the case
of a Lender, against Company, whether in connection with this
Agreement, the transactions contemplated herein or any unrelated
transaction (including any underlying transaction between Company or
one of its Subsidiaries and the beneficiary for which any Letter of
Credit was procured);
(iii) any draft or other document presented under any Letter
of Credit proving to be forged, fraudulent, invalid or insufficient
in any respect or any statement therein being untrue or inaccurate
in any respect;
(iv) payment by the applicable Issuing Lender under any Letter
of Credit against presentation of a draft or other document which
does not substantially comply with the terms of such Letter of
Credit;
(v) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or prospects
of Company or any of its Subsidiaries;
(vi) any breach of this Agreement or any other Loan Document
by any party thereto;
(vii) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing; or
(viii) the fact that an Event of Default or a Potential Event
of Default shall have occurred and be continuing;
PROVIDED, in each case, that payment by the applicable Issuing Lender under the
applicable Letter of Credit shall not have constituted gross negligence or
willful misconduct of such Issuing Lender under the circumstances in question
(as determined by a final judgment of a court of competent jurisdiction).
3.5 INDEMNIFICATION; NATURE OF ISSUING LENDERS' DUTIES.
A. INDEMNIFICATION. In addition to amounts payable as provided in
subsection 3.6, Company hereby agrees to protect, indemnify, pay and save
harmless each Issuing Lender from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
fees, expenses and disbursements of counsel and allocated costs of internal
counsel) which such Issuing Lender may incur or be subject to as a consequence,
direct or indirect, of (i) the issuance of any Letter of Credit by such Issuing
Lender, other than as a result of (a) the gross negligence or willful misconduct
of such Issuing Lender as determined by a final judgment of a court of competent
jurisdiction or (b) subject to the following clause (ii), the wrongful dishonor
by such Issuing Lender of a proper demand for payment made under
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any Letter of Credit issued by it or (ii) the failure of such Issuing Lender to
honor a drawing under any such Letter of Credit as a result of any act or
omission, whether rightful or wrongful, of any present or future de jure or de
facto government or governmental authority (all such acts or omissions herein
called "Governmental Acts").
B. NATURE OF ISSUING LENDERS' DUTIES. As between Company and any
Issuing Lender, Company assumes all risks of the acts and omissions of, or
misuse of the Letters of Credit issued by such Issuing Lender by, the respective
beneficiaries of such Letters of Credit. In furtherance and not in limitation of
the foregoing, such Issuing Lender shall not be responsible for: (i) the form,
validity, sufficiency, accuracy, genuineness or legal effect of any document
submitted by any party in connection with the application for and issuance of
any such Letter of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason; (iii) failure of the beneficiary of
any such Letter of Credit to comply fully with any conditions required in order
to draw upon such Letter of Credit; (iv) errors, omissions, interruptions or
delays in transmission or delivery of any messages, by mail, cable, telegraph,
telex or otherwise, whether or not they be in cipher; (v) errors in
interpretation of technical terms; (vi) any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under any such
Letter of Credit or of the proceeds thereof; (vii) the misapplication by the
beneficiary of any such Letter of Credit of the proceeds of any drawing under
such Letter of Credit; or (viii) any consequences arising from causes beyond the
control of such Issuing Lender, including any Governmental Acts, and none of the
above shall affect or impair, or prevent the vesting of, any of such Issuing
Lender's rights or powers hereunder.
In furtherance and extension and not in limitation of the specific
provisions set forth in the first paragraph of this subsection 3.5B, any action
taken or omitted by any Issuing Lender under or in connection with the Letters
of Credit issued by it or any documents and certificates delivered thereunder,
if taken or omitted in good faith, shall not put such Issuing Lender under any
resulting liability to Company.
Notwithstanding anything to the contrary contained in this
subsection 3.5, Company shall retain any and all rights it may have against any
Issuing Lender for any liability arising solely out of the gross negligence or
willful misconduct of such Issuing Lender, as determined by a final judgment of
a court of competent jurisdiction.
3.6 INCREASED COSTS AND TAXES RELATING TO LETTERS OF CREDIT.
Subject to the provisions of subsection 2.7B (which shall be
controlling with respect to the matters covered thereby), in the event that any
Issuing Lender or Revolving Loan Lender shall determine (which determination
shall, absent manifest error, be final and conclusive and binding upon all
parties hereto) that any law, treaty or governmental rule, regulation or order,
or any change therein or in the interpretation, administration or application
thereof (including the introduction of any new law, treaty or governmental rule,
regulation or order), or any determination of a court or governmental authority,
in each case that becomes effective after the
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date hereof, or compliance by any Issuing Lender or Revolving Loan Lender with
any guideline, request or directive issued or made after the date hereof by any
central bank or other governmental or quasi-governmental authority (whether or
not having the force of law):
(i) subjects such Issuing Lender or Revolving Loan Lender (or its
applicable lending or letter of credit office) to any additional Tax
(other than any Tax on the overall net income of such Issuing Lender or
Revolving Loan Lender) with respect to the issuing or maintaining of
any Letters of Credit or the purchasing or maintaining of any
participations therein or any other obligations under this Section 3,
whether directly or by such being imposed on or suffered by any
particular Issuing Lender;
(ii) imposes, modifies or holds applicable any reserve (including
any marginal, emergency, supplemental, special or other reserve),
special deposit, compulsory loan, FDIC insurance or similar requirement
in respect of any Letters of Credit issued by any Issuing Lender or
participations therein purchased by any Revolving Loan Lender; or
(iii) imposes any other condition (other than with respect to a Tax
matter) on or affecting such Issuing Lender or Revolving Loan Lender
(or its applicable lending or letter of credit office) regarding this
Section 3 or any Letter of Credit or any participation therein;
and the result of any of the foregoing is to increase the cost to such Issuing
Lender or Revolving Loan Lender of agreeing to issue, issuing or maintaining any
Letter of Credit or agreeing to purchase, purchasing or maintaining any
participation therein or to reduce any amount received or receivable by such
Issuing Lender or Revolving Loan Lender (or its applicable lending or letter of
credit office) with respect thereto; then, in any case, Company shall promptly
pay to such Issuing Lender or Revolving Loan Lender, upon receipt of the
statement referred to in the next sentence, such additional amount or amounts as
may be necessary to compensate such Issuing Lender or Revolving Loan Lender for
any such increased cost or reduction in amounts received or receivable
hereunder. Such Issuing Lender or Revolving Loan Lender shall deliver to Company
a written statement, setting forth in reasonable detail the basis for
calculating the additional amounts owed to such Issuing Lender or Revolving Loan
Lender under this subsection 3.6, which statement shall be conclusive and
binding upon all parties hereto absent manifest error.
SECTION 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT
The obligations of Lenders to make Loans and the issuance of Letters
of Credit hereunder are subject to the satisfaction of the following conditions.
4.1 CONDITIONS TO TERM LOANS AND INITIAL REVOLVING LOANS AND SWING LINE
LOANS
The obligations of Lenders to make the Term Loans and any Revolving
Loans and Swing Line Loans to be made on the Closing Date are, in addition to
the conditions precedent specified in subsection 4.2, subject to prior or
concurrent satisfaction of the following conditions:
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A. LOAN PARTY DOCUMENTS. On or before the Closing Date, Company shall,
and shall cause each other Loan Party to, deliver to Lenders (or to
Administrative Agent for Lenders with sufficient originally executed copies,
where appropriate, for each Lender and its counsel) the following with respect
to Company or such Loan Party, as the case may be, each, unless otherwise noted,
dated the Closing Date:
(i) Certified copies of the Certificate or Articles of Incorporation
of such Person, together with a good standing certificate from the
Secretary of State of its jurisdiction of incorporation and each other
state in which such Person is qualified as a foreign corporation to do
business and, to the extent generally available, a certificate or other
evidence of good standing as to payment of any applicable franchise or
similar taxes from the appropriate taxing authority of each of such
jurisdictions, each dated a recent date prior to the Closing Date;
(ii) Copies of the Bylaws of such Person, certified as of the
Closing Date by such Person's corporate secretary or an assistant
secretary;
(iii) Resolutions of the Board of Directors of such Person approving
and authorizing the execution, delivery and performance of the Loan
Documents and Related Agreements to which it is a party, certified as
of the Closing Date by the corporate secretary or an assistant
secretary of such Person as being in full force and effect without
modification or amendment;
(iv) Signature and incumbency certificates of the officers of such
Person executing the Loan Documents and Related Agreements to which it
is a party;
(v) Executed originals of the Loan Documents to which such Person is
a party; and
(vi) Such other documents as any Agent may reasonably request.
B. TARGET DOCUMENTS. On or before the Closing Date, Company shall
deliver to Lenders (or to Administrative Agent for Lenders with sufficient
originally executed copies, where appropriate, for each Lender and its counsel)
the following with respect to Target and each of its Domestic Subsidiaries,
each, unless otherwise noted, dated the Closing Date:
(i) Certified copies of the Certificate or Articles of
Incorporation of Target and each of its Domestic Subsidiaries, together
with a good standing certificate from the Secretary of State of its
jurisdiction of incorporation and each other state in which Target and
each of its Domestic Subsidiaries is qualified as a foreign corporation
to do business and, to the extent generally available, a certificate or
other evidence of good standing as to payment of any applicable
franchise or similar taxes from the appropriate taxing authority of
each of such jurisdictions, each dated a recent date prior to the
Closing Date;
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(ii) Copies of the Bylaws of Target and each of its Domestic
Subsidiaries, certified as of the Closing Date by the corporate
secretary or an assistant secretary of such Person;
(iii) Resolutions of the Board of Directors of Target and each of
its Domestic Subsidiaries approving and authorizing the execution,
delivery and performance of the Loan Documents to which it is a party
and, in the case of Target, approving and authorizing the execution,
delivery and performance of the Merger Agreement and the consummation
of the Merger in the manner contemplated by the Tender Offer Materials,
certified as of the Closing Date by the corporate secretary or an
assistant secretary of such Person as being in full force and effect
without modification or amendment;
(iv) Signature and incumbency certificates of the officers of
Target and each of its Domestic Subsidiaries executing the Merger
Agreement and the Loan Documents to which it is a party; and
(v) Executed originals of the Subsidiary Guaranty and Collateral
Documents to which such Person is a party.
C. NO MATERIAL ADVERSE EFFECT. Since December 31, 1997, in the
reasonable opinion of the Agents, there shall have occurred no (i) material
adverse change in the business, assets, properties (including intangible
assets), condition (financial or otherwise), results of operations, prospects
(other than a change in general economic conditions, but including a change in
the industry in which Company and its Subsidiaries or Target and its
Subsidiaries operate), liabilities or regulatory status of Company and its
Subsidiaries taken as a whole or of Target and its Subsidiaries taken as a whole
or in the facts and information as represented to Agents or (ii) material
impairment of the ability of any Loan Party to perform, or of Agents or Lenders
to enforce, the Obligations.
D. CORPORATE AND CAPITAL STRUCTURE, OWNERSHIP, ETC. The capital
structure and ownership of Company and its Subsidiaries, both before and after
giving effect to the consummation of the Tender Offer and the Merger, shall be
as set forth on Schedule 4.1D annexed hereto.
E. [INTENTIONALLY OMITTED]
F. INVESTMENT BY ALAN M. MECKLER. Company shall have sold 80.1% of the
issued and outstanding membership interests of internet.com, LLC, a Delaware
limited liability company ("iWorld") to Alan M. Meckler and or more one or more
Persons under his control, and received gross cash proceeds of not less than
$18,000,000 therefor, and Company shall have evidence satisfactory to Agents of
such sale.
G. TENDERED TARGET SHARES. Company shall have delivered to
Administrative Agent (i) a certificate of Depositary certifying to the number of
Tendered Target Shares, and (ii) an Officers' Certificate of Company certifying
that the Tendered Target Shares purchased with the
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proceeds of the Term Loans to be made on the Closing Date represent, in the
aggregate, not less than the Minimum Shares.
H. MAXIMUM CONSIDERATION FOR TENDERED TARGET SHARES AND TARGET STOCK
OPTIONS. Administrative Agent shall have received evidence satisfactory to
Agents that the aggregate consideration paid by Merger Sub on the Closing Date
to purchase the Tendered Target Shares, plus the aggregate consideration paid or
to be paid by Merger Sub for any shares of Target Common Stock that have been
converted (or will be converted on the Merger Date) into the right to receive a
cash payment pursuant to the Merger Agreement and any other shares of Target
Common Stock acquired in any manner whatsoever, plus the amount needed to
purchase the Target Stock Options, does not exceed $274,000,000.
I. MAXIMUM TRANSACTION COSTS. Administrative Agent shall have received
evidence satisfactory to Agents that the Transaction Costs incurred as of the
Closing Date do not exceed $16,500,000.
J. RELATED AGREEMENTS.
(i) TENDER OFFER MATERIALS. Administrative Agents shall have
received copies of all Tender Offer Materials and other documents in
connection therewith filed with the Securities and Exchange Commission
and the Tender Offer Materials shall be reasonably satisfactory in form
and substance to Agents and Requisite Lenders. The Tender Offer shall
have been consummated in all respects in accordance with the Tender
Offer Materials.
(ii) [intentionally omitted].
(iii) RELATED AGREEMENTS IN FULL FORCE AND EFFECT. Administrative
Agent shall have received a fully executed or conformed copy of each
Related Agreement and any documents executed in connection therewith,
and each Related Agreement shall be in full force and effect and no
provision thereof shall have been modified or waived in any respect
determined by Agent to be material, in each case without the consent of
Agents.
(iv) OFFICERS' CERTIFICATES. Administrative Agent shall have
received an Officers' Certificate from each of the parties to the
Merger Agreement to the effect that (a) the representations and
warranties of such party, if any, in the Merger Agreement are true,
correct and complete in all material respects on and as of the Closing
Date to the same extent as though made on and as of that date, (b) the
Merger Agreement is in full force and effect and no provision thereof
has been modified or waived in any respect without the consent of
Agents and Requisite Lenders and (c) each such Person has complied with
all agreements and conditions contained in the Merger Agreement and any
agreements or documents referred to therein required to be performed or
complied with by each of them on or before the Closing Date and none of
such Persons are in default in their performance or compliance with any
of the terms or provisions thereof.
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K. MATTERS RELATING TO EXISTING COMPANY INDEBTEDNESS.
(i) PREPAYMENT OF EXISTING COMPANY INDEBTEDNESS. On the Closing
Date, Company and its Subsidiaries shall have (a) repaid in full all
Existing Company Indebtedness (the aggregate principal amount of which
Indebtedness is approximately $41,500,000), (b) terminated any
commitments to lend or make other extensions of credit thereunder, (c)
delivered to Agents all documents or instruments necessary to release
all Liens securing Indebtedness or other obligations of Company and its
Subsidiaries thereunder, and (d) made arrangements satisfactory to
Agents with respect to the cancellation of any letters of credit
outstanding thereunder or the issuance of Letters of Credit to support
the obligations of Company and its Subsidiaries with respect thereto.
(ii) EXISTING INDEBTEDNESS TO REMAIN OUTSTANDING. Administrative
Agent shall have received an Officers' Certificate of Company stating
that, after giving effect to the transactions described in this
subsection 4.1K, the Indebtedness of Loan Parties (other than
Indebtedness under the Loan Documents shall consist of approximately
(pound)1,500,000 in aggregate principal amount of outstanding
Indebtedness described in SCHEDULE 7.1 annexed hereto. The terms and
conditions of all such Indebtedness shall be in form and in substance
satisfactory to Agents.
L. NECESSARY GOVERNMENTAL AUTHORIZATIONS AND CONSENTS; EXPIRATION OF
WAITING PERIODS, ETC. Company shall have obtained all Governmental
Authorizations and all consents of other Persons, in each case that are
necessary or advisable in connection with the Tender Offer and the Merger, the
other transactions contemplated by the Loan Documents and the Related
Agreements, and the continued operation of the business conducted by Target and
its Subsidiaries in substantially the same manner as conducted prior to the
consummation of the Tender Offer and the Merger, and each of the foregoing shall
be in full force and effect, in each case other than those the failure to obtain
or maintain which, either individually or in the aggregate, would not reasonably
be expected to have a Material Adverse Effect. All applicable waiting periods
shall have expired without any action being taken or threatened by any competent
authority which would restrain, prevent or otherwise impose adverse conditions
on the Tender Offer or the Merger or the financing thereof. No action, request
for stay, petition for review or rehearing, reconsideration, or appeal with
respect to any of the foregoing shall be pending, and the time for any
applicable agency to take action to set aside its consent on its own motion
shall have expired.
M. CLOSING DATE MORTGAGES; CLOSING DATE MORTGAGE POLICIES; ETC.
Administrative Agent shall have received from Company and each applicable
Subsidiary Guarantor:
(i) CLOSING DATE MORTGAGES. Fully executed and notarized Mortgages
(each a "CLOSING DATE MORTGAGE" and, collectively, the "CLOSING DATE
MORTGAGES"), in proper form for recording in all appropriate places in
all applicable jurisdictions, encumbering each Real Property Asset
listed in SCHEDULE 4.1M annexed hereto (each a "CLOSING DATE MORTGAGED
PROPERTY" and, collectively, the "CLOSING DATE MORTGAGED PROPERTIES");
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(ii) OPINIONS OF COUNSEL. An opinion of Jones, Day, Reavis & Pogue
with respect to the enforceability of the form(s) of Closing Date
Mortgages to be recorded in such state and such other matters as any
Agent may reasonably request, in each case in form and substance
reasonably satisfactory to such Agent;
(iii) [intentionally omitted]
(iv) TITLE INSURANCE. (a) ALTA mortgagee title insurance policies or
unconditional commitments therefor (the "CLOSING DATE MORTGAGE
POLICIES") issued by the Title Company with respect to the Closing Date
Mortgaged Properties listed in SCHEDULE 4.1M annexed hereto, in amounts
not less than the respective amounts designated therein with respect to
any particular Closing Date Mortgaged Properties, insuring fee simple
title to, or a valid leasehold interest in, each such Closing Date
Mortgaged Property vested in such Loan Party and assuring
Administrative Agent that the applicable Closing Date Mortgages create
valid and enforceable First Priority mortgage Liens on the respective
Closing Date Mortgaged Properties encumbered thereby, subject only to a
standard survey exception, which Closing Date Mortgage Policies (1)
shall include an endorsement for mechanics' liens, for future advances
under this Agreement and for any other matters reasonably requested by
any Agent and (2) shall provide for affirmative insurance and such
reinsurance as any Agent may reasonably request, all of the foregoing
in form and substance reasonably satisfactory to Agents; and (b)
evidence satisfactory to Agents that such Loan Party has (i) delivered
to the Title Company all certificates and affidavits required by the
Title Company in connection with the issuance of the Closing Date
Mortgage Policies and (ii) paid to the Title Company or to the
appropriate governmental authorities all expenses and premiums of the
Title Company in connection with the issuance of the Closing Date
Mortgage Policies and all recording and stamp taxes (including mortgage
recording and intangible taxes) payable in connection with recording
the Closing Date Mortgages in the appropriate real estate records;
(v) TITLE REPORTS. With respect to each Closing Date Mortgaged
Property listed in of SCHEDULE 4.1M annexed hereto, a title report
issued by the Title Company with respect thereto, dated not more than
30 days prior to the Closing Date and satisfactory in form and
substance to Agents;
(vi) COPIES OF DOCUMENTS RELATING TO TITLE EXCEPTIONS. Copies of all
recorded documents listed as exceptions to title or otherwise referred
to in the Closing Date Mortgage Policies or in the title reports
delivered pursuant to subsection 4.1M(v); and
(vii) MATTERS RELATING TO FLOOD HAZARD PROPERTIES. (a) Evidence,
which may be in the form of a letter from Stewart Mortgage Information
or from an insurance broker or a municipal engineer, as to whether (1)
any Closing Date Mortgaged Property is a Flood Hazard Property and (2)
the community in which any such Flood Hazard Property is located is
participating in the National Flood Insurance Program, (b) if there are
any such Flood Hazard Properties, such Loan Party's written
acknowledgement of receipt of written notification from Agent (1) as to
the existence of each such Flood Hazard
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Property and (2) as to whether the community in which each such
Flood Hazard Property is located is participating in the National Flood
Insurance Program, and (c) in the event any such Flood Hazard Property
is located in a community that participates in the National Flood
Insurance Program, evidence that Company has obtained flood insurance
in respect of such Flood Hazard Property to the extent required under
the applicable regulations of the Board of Governors of the Federal
Reserve System.
N. SECURITY INTERESTS IN PERSONAL AND MIXED PROPERTY. To the extent not
otherwise satisfied pursuant to subsection 4.1M, Administrative Agent shall have
received evidence satisfactory to Agents that Company and Subsidiary Guarantors
(including Target and its Subsidiaries) shall have taken or caused to be taken
all such actions, executed and delivered or caused to be executed and delivered
all such agreements, documents and instruments, and made or caused to be made
all such filings and recordings (other than the filing or recording of items
described in clauses (iii), (iv) and (v) below) that may be necessary or, in the
opinion of any Agent, desirable in order to create in favor of Administrative
Agent, for the benefit of Lenders, a valid and (upon such filing and recording)
perfected First Priority security interest in the entire personal and mixed
property Collateral. Such actions shall include, without limitation, the
following:
(i) SCHEDULES TO COLLATERAL DOCUMENTS. Delivery to Administrative
Agent of accurate and complete schedules to all of the applicable
Collateral Documents.
(ii) STOCK CERTIFICATES AND INSTRUMENTS. Delivery to Administrative
Agent of (a) certificates (which certificates shall be accompanied by
irrevocable undated stock powers, duly endorsed in blank and otherwise
satisfactory in form and substance to Agents) representing all capital
stock pledged pursuant to the Company Pledge Agreement (other than,
prior to the Merger Date, Target Common Stock) and the Subsidiary
Pledge Agreements and (b) all promissory notes or other instruments
(duly endorsed, where appropriate, in a manner satisfactory to Agents)
evidencing any Collateral;
(iii) LIEN SEARCHES AND UCC TERMINATION STATEMENTS. Delivery to
Administrative Agent of (a) the results of a recent search, by a Person
satisfactory to Agents, of all effective UCC financing statements and
fixture filings and all judgment and tax lien filings which may have
been made with respect to any personal or mixed property of any Loan
Party, together with copies of all such filings disclosed by such
search, and (b) UCC termination statements duly executed by all
applicable Persons for filing in all applicable jurisdictions as may be
necessary to terminate any effective UCC financing statements or
fixture filings disclosed in such search (other than any such financing
statements or fixture filings in respect of Liens permitted to remain
outstanding pursuant to the terms of this Agreement).
(iv) UCC FINANCING STATEMENTS AND FIXTURE FILINGS. Delivery to
Administrative Agent of UCC financing statements and, where
appropriate, fixture filings, duly executed by each applicable Loan
Party with respect to all personal and mixed property Collateral of
such Loan Party, for filing in all jurisdictions as may be necessary
or, in the opinion of
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Agents, desirable to perfect the security interests created in such
Collateral pursuant to the Collateral Documents;
(v) DEEDS OF CHARGE. Delivery to Administrative Agent of (i) a duly
executed Deed of Charge, in form and substance satisfactory to Agents,
perfecting under English law the Lien on the shares of stock of each
Foreign Subsidiary of Company and Target organized under the laws of
England, (ii) duly executed and completed but undated transfers (with
the name of the transferee left blank)of such shares, together with
share certificates in respect thereof and such other documents as may
be necessary to enable Administrative Agent to register such shares in
its name or that of its nominee pursuant to such Deeds of Charge, and
(iii) evidence that the articles of association of each such Foreign
Subsidiary provide that (x) its directors must register any transfer of
its shares to any chargee of such shares or its nominee upon the
enforcement of a charge on such shares and (y) such provision is not
thereafter amended without the prior written consent of Administrative
Agent (and then only to the extent that such consent permits and in
accordance with any conditions thereof); and
(vi) PTO COVER SHEETS, ETC. Delivery to Administrative Agent of all
cover sheets or other documents or instruments required to be filed
with the PTO or the U.S. Copyright Office in order to create or perfect
Liens in respect of any IP Collateral, and, if requested by Agents,
checks payable by Company to the applicable filing offices for the
filing fees for the Collateral Documents to be filed in such offices.
O. MERGER DOCUMENTS. If the Closing Date is also the Merger Date,
Company shall have complied with subsection 6.12.
P. PRO FORMA CONSOLIDATED LEVERAGE RATIO. Administrative Agent shall
have received an Officers' Certificate of Company certifying the Consolidated
Leverage Ratio measured on a pro forma basis as of the Closing Date, after
giving effect to the purchase of the Tendered Target Shares and the consummation
of the other transactions contemplated by the Tender Offer Materials to occur on
the Closing Date.
Q. NOTICE OF ACCOUNT DESIGNATION. Administrative Agent shall have
received a Notice of Account Designation substantially in the form of EXHIBIT
XXI hereto, duly executed by Company.
R. FINANCIAL STATEMENTS; PRO FORMA BALANCE SHEET. On or before the
Closing Date, Administrative Agent shall have received from Company (i) pro
forma consolidated balance sheets of Company and its Subsidiaries as at the
Closing Date, prepared in accordance with GAAP and reflecting the consummation
of the Tender Offer and the Merger, the related financings and the other
transactions contemplated by the Loan Documents and the Related Agreements,
which pro forma financial statements shall be in form and substance satisfactory
to Lenders, (ii) projected consolidated financial statements of Company and its
Subsidiaries (including Surviving Corporation) for the ten-year period after the
Closing Date consisting of consolidated balance sheets and the related
consolidated of income, shareholders' equity and cash
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flows, all of which financial statements and projected financial statements
shall be substantially consistent with any financial statements or projected
financial results for the same periods delivered to Agent prior to October 8,
1998, and otherwise in form and substance satisfactory to Agents and Lenders,
and (iii) consolidated financial statements of Company as of the most recently
completed Fiscal Quarter of Company prepared in accordance with GAAP and
otherwise in form and substance satisfactory to Agents and Lenders.
S. SOLVENCY ASSURANCES. On the Closing Date, Administrative Agent shall
have received a Financial Condition Certificate dated the Closing Date,
substantially in the form of Exhibit XIII annexed hereto and with appropriate
attachments, in each case demonstrating that, after giving effect to the
consummation of the Tender Offer and the Merger, the related financings and the
other transactions contemplated by the Loan Documents and the Related
Agreements, Company will be Solvent.
T. EVIDENCE OF INSURANCE. Administrative Agent shall have received a
certificate from Company's insurance broker or other evidence satisfactory to it
that all insurance required to be maintained pursuant to subsection 6.4 is in
full force and effect and that Administrative Agent on behalf of Lenders has
been named as additional insured and/or loss payee thereunder to the extent
required under subsection 6.4.
U. OPINIONS OF COUNSEL TO LOAN PARTIES. Lenders and their respective
counsel shall have received (i) originally executed copies of one or more
favorable written opinions of Jones, Day, Reavis & Pogue, counsel for Loan
Parties, including Target, in form and substance reasonably satisfactory to
Agents and their counsel, dated as of the Closing Date and setting forth
substantially the matters in the opinions designated in EXHIBIT IX annexed
hereto, (ii) originally executed copies of one or more favorable written
opinions of local counsel (which counsel shall be reasonably satisfactory to
Agents) under the laws of each jurisdiction in which Domestic Subsidiary of
Company is organized (other than any Domestic Subsidiary that is a Delaware
corporation) as to the due organization and good standing of such Subsidiary,
the due authorization, execution and delivery by such Subsidiary of such Loan
Documents, and in each case as to such other matters as Agents acting on behalf
of Lenders may reasonably request and (iii) evidence satisfactory to Agents that
Company has requested such counsel to deliver such opinions to Lenders.
V. OPINIONS OF AGENTS' COUNSEL. Lenders shall have received originally
executed copies of one or more favorable written opinions of O'Melveny & Myers
LLP, counsel to Agents, dated as of the Closing Date, substantially in the form
of EXHIBIT X annexed hereto and as to such other matters as Agents acting on
behalf of Lenders may reasonably request.
W. FEES. Company shall have paid to Administrative Agent, for
distribution (as appropriate) to Arranger, Agents and Lenders, the fees payable
on the Closing Date referred to in subsection 2.3.
X. REPRESENTATIONS AND WARRANTIES; PERFORMANCE OF AGREEMENTS. Company
shall have delivered to Administrative Agent an Officers' Certificate, in form
and substance satisfactory
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to Agents, to the effect that the representations and warranties in Section 5
hereof are true, correct and complete in all material respects on and as of the
Closing Date to the same extent as though made on and as of that date (or, to
the extent such representations and warranties specifically relate to an earlier
date, that such representations and warranties were true, correct and complete
in all material respects on and as of such earlier date) and that Company shall
have performed in all material respects all agreements and satisfied all
conditions which this Agreement provides shall be performed or satisfied by it
on or before the Closing Date except as otherwise disclosed to and agreed to in
writing by Agents and Requisite Lenders.
Y. COMPLETION OF PROCEEDINGS. All corporate and other proceedings taken
or to be taken in connection with the transactions contemplated hereby and all
documents incidental thereto not previously found acceptable by each Agent,
acting on behalf of Lenders, and its counsel shall be satisfactory in form and
substance to such Agent and such counsel, and such Agent and such counsel shall
have received all such counterpart originals or certified copies of such
documents as such Agent may reasonably request.
4.2 CONDITIONS TO ALL LOANS
The obligations of Lenders to make Loans on each Funding Date are
subject to the following further conditions precedent:
A. Administrative Agent shall have received before that Funding
Date, in accordance with the provisions of subsection 2.1B, an originally
executed Notice of Borrowing, in each case signed by the chief executive
officer, the chief financial officer or the treasurer of Company or by any
executive officer of Company designated by any of the above-described officers
on behalf of Company in a writing delivered to Administrative Agent.
B. As of that Funding Date:
(i) The representations and warranties contained herein and in the
other Loan Documents shall be true, correct and complete in all
material respects on and as of that Funding Date to the same extent as
though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date,
in which case such representations and warranties shall have been true,
correct and complete in all material respects on and as of such earlier
date;
(ii) No event shall have occurred and be continuing or would result
from the consummation of the borrowing contemplated by such Notice of
Borrowing that would constitute an Event of Default or a Potential
Event of Default;
(iii) Each Loan Party shall have performed in all material respects
all agreements and satisfied all conditions which this Agreement
provides shall be performed or satisfied by it on or before that
Funding Date;
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(iv) No order, judgment or decree of any court, arbitrator or
governmental authority shall purport to enjoin or restrain any Lender
from making the Loans to be made by it on that Funding Date;
(v) The making of the Loans requested on such Funding Date shall
not violate any law including Regulation T, Regulation U or Regulation
X of the Board of Governors of the Federal Reserve System; and
(vi) There shall not be pending or, to the knowledge of Company,
threatened, any action, suit, proceeding, governmental investigation or
arbitration against or affecting Company or any of its Subsidiaries or
any property of Company or any of its Subsidiaries that has not been
disclosed by Company in writing pursuant to subsection 5.6 or 6.1(x)
prior to the making of the last preceding Loans (or, in the case of the
initial Loans, prior to the execution of this Agreement), and there
shall have occurred no development not so disclosed in any such action,
suit, proceeding, governmental investigation or arbitration so
disclosed, that, in either event, in the opinion of any Agent or of
Requisite Lenders, would be expected to have a Material Adverse Effect;
and no injunction or other restraining order shall have been issued and
no hearing to cause an injunction or other restraining order to be
issued shall be pending or noticed with respect to any action, suit or
proceeding seeking to enjoin or otherwise prevent the consummation of,
or to recover any damages or obtain relief as a result of, the
transactions contemplated by this Agreement or the making of Loans
hereunder.
4.3 CONDITIONS TO LETTERS OF CREDIT
The issuance of any Letter of Credit hereunder (whether or not the
applicable Issuing Lender is obligated to issue such Letter of Credit) is
subject to the following conditions precedent:
A. On or before the date of issuance of the initial Letter of Credit
pursuant to this Agreement, the initial Loans shall have been made.
B. On or before the date of issuance of such Letter of Credit,
Administrative Agent shall have received, in accordance with the provisions of
subsection 3.1B(i), an originally executed Notice of Issuance of Letter of
Credit, in each case signed by the chief executive officer, the chief financial
officer or the treasurer of Company or by any executive officer of Company
designated by any of the above-described officers on behalf of Company in a
writing delivered to Administrative Agent, together with all other information
specified in subsection 3.1B(i) and such other documents or information as the
applicable Issuing Lender may reasonably require in connection with the issuance
of such Letter of Credit.
C. On the date of issuance of such Letter of Credit, all conditions
precedent described in subsection 4.2B shall be satisfied to the same extent as
if the issuance of such Letter of Credit were the making of a Loan and the date
of issuance of such Letter of Credit were a Funding Date.
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SECTION 5. COMPANY'S REPRESENTATIONS AND WARRANTIES
In order to induce Lenders and Agents to enter into this
Agreement and to make the Loans, to induce Issuing Lenders to issue Letters of
Credit and to induce other Lenders to purchase participations therein, Company
represents and warrants to each Lender and each Agent, on the date of this
Agreement, on each Funding Date and on the date of issuance of each Letter of
Credit, that the following statements are true, correct and complete:
5.1 ORGANIZATION, POWERS, QUALIFICATION, GOOD STANDING, BUSINESS AND
SUBSIDIARIES
A. ORGANIZATION AND POWERS. Each Loan Party is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation as specified in SCHEDULE 5.1 annexed hereto. Each
Loan Party has all requisite corporate power and authority to own and operate
its properties, to carry on its business as now conducted and as proposed to be
conducted, to enter into the Loan Documents and Related Agreements to which it
is a party and to carry out the transactions contemplated thereby.
B. QUALIFICATION AND GOOD STANDING. Each Loan Party is qualified to do
business and in good standing in every jurisdiction where its assets are located
and wherever necessary to carry out its business and operations, except in
jurisdictions where the failure to be so qualified or in good standing has not
had and could not reasonably be expected to have a Material Adverse Effect.
C. CONDUCT OF BUSINESS. Company and its Subsidiaries are engaged only
in the businesses permitted to be engaged in pursuant to subsection 7.14.
D. SUBSIDIARIES. All of the Subsidiaries of Company are identified in
SCHEDULE 5.1 annexed hereto, as said SCHEDULE 5.1 may be supplemented from time
to time pursuant to the provisions of subsection 6.1(xvii). The capital stock of
each of the Subsidiaries of Company identified in SCHEDULE 5.1 annexed hereto
(as so supplemented) is duly authorized, validly issued, fully paid and
nonassessable and none of such capital stock (other than the Target Common
Stock) constitutes Margin Stock. Each of the Subsidiaries of Company identified
in SCHEDULE 5.1 annexed hereto (as so supplemented) is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation set forth therein, has all requisite corporate
power and authority to own and operate its properties and to carry on its
business as now conducted and as proposed to be conducted, and is qualified to
do business and in good standing in every jurisdiction where its assets are
located and wherever necessary to carry out its business and operations, in each
case except where failure to be so qualified or in good standing or a lack of
such corporate power and authority has not had and could not reasonably be
expected to have a Material Adverse Effect. SCHEDULE 5.1 annexed hereto (as so
supplemented) correctly sets forth, as of the Closing Date, the ownership
interest of Company and each of its Subsidiaries in each of the Subsidiaries of
Company identified therein.
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5.2 AUTHORIZATION OF BORROWING, ETC.
A. AUTHORIZATION OF BORROWING. The execution, delivery and performance
of the Loan Documents and the Related Agreements have been duly authorized by
all necessary corporate action on the part of each Loan Party that is a party
thereto.
B. NO CONFLICT. The execution, delivery and performance by Loan Parties
of the Loan Documents and the Related Agreements to which they are parties and
the consummation of the transactions contemplated by the Loan Documents and such
Related Agreements do not and will not (i) violate any provision of any law or
any governmental rule or regulation applicable to Company or any of its
Subsidiaries, the Certificate or Articles of Incorporation or Bylaws of Company
or any of its Subsidiaries or any order, judgment or decree of any court or
other agency of government binding on Company or any of its Subsidiaries, (ii)
conflict with, result in a breach of or constitute (with due notice or lapse of
time or both) a default under any Contractual Obligation of Company or any of
its Subsidiaries, (iii) result in or require the creation or imposition of any
Lien upon any of the properties or assets of Company or any of its Subsidiaries
(other than any Liens created under any of the Loan Documents in favor of
Administrative Agent on behalf of Lenders), or (iv) require any approval of
stockholders or any approval or consent of any Person under any Contractual
Obligation of Company or any of its Subsidiaries, except for such approvals or
consents which will be obtained on or before the Closing Date and disclosed in
writing to Lenders.
C. GOVERNMENTAL CONSENTS. The execution, delivery and performance by
Loan Parties of the Loan Documents and the Related Agreements to which they are
parties and the consummation of the transactions contemplated by the Loan
Documents and such Related Agreements do not and will not require any
registration with, consent or approval of, or notice to, or other action to,
with or by, any federal, state or other governmental authority or regulatory
body, other than such actions as have been taken on or before the Closing Date.
D. BINDING OBLIGATION. Each of the Loan Documents and Related
Agreements has been duly executed and delivered by each Loan Party that is a
party thereto and is the legally valid and binding obligation of such Loan
Party, enforceable against such Loan Party in accordance with its respective
terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors' rights generally
or by equitable principles relating to enforceability.
5.3 FINANCIAL CONDITION
Company has heretofore delivered to Lenders, at Lenders'
request, the following financial statements and information: (i) the audited
consolidated balance sheets of Company and its Subsidiaries as at December 31,
1997 and the related consolidated statements of income, stockholders' equity and
cash flows of Company and its Subsidiaries for the Fiscal Year then ended, (ii)
the unaudited consolidated balance sheets of Company and its Subsidiaries as at
June 30, 1998 and the related unaudited consolidated statements of income,
stockholders' equity and cash flows of Company and its Subsidiaries for the six
months then ended, and (iii) the
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audited consolidated balance sheets of Target and its Subsidiaries as at
September 30, 1997 and as at September 30, 1998 and the related consolidated
statements of income, stockholders' equity and cash flows of Target and its
Subsidiaries for the fiscal years then ended. All such statements were prepared
in conformity with GAAP and fairly present, in all material respects, the
financial position (on a consolidated basis) of the entities described in such
financial statements as at the respective dates thereof and the results of
operations and cash flows (on a consolidated basis) of the entities described
therein for each of the periods then ended, subject, in the case of any such
unaudited financial statements, to changes resulting from audit and normal
year-end adjustments. Company does not (and will not following the funding of
the initial Loans) have any Contingent Obligation, contingent liability or
liability for taxes, long-term lease or unusual forward or long-term commitment
that is not reflected in the foregoing financial statements or the notes thereto
and which in any such case is material in relation to the business, operations,
properties, assets, condition (financial or otherwise) or prospects of Company
or any of its Subsidiaries.
5.4 NO MATERIAL ADVERSE CHANGE; NO RESTRICTED JUNIOR PAYMENTS
Since December 31, 1997, no event or change has occurred that
has caused or evidences, either in any case or in the aggregate, a Material
Adverse Effect. Neither Company nor any of its Subsidiaries has directly or
indirectly declared, ordered, paid or made, or set apart any sum or property
for, any Restricted Junior Payment or agreed to do so except as permitted by
subsection 7.5.
5.5 TITLE TO PROPERTIES; LIENS; REAL PROPERTY
A. TITLE TO PROPERTIES; LIENS. Company and its Subsidiaries have (i)
good, sufficient and legal title to (in the case of fee interests in real
property), (ii) valid leasehold interests in (in the case of leasehold interests
in real or personal property), or (iii) good title to (in the case of all other
personal property), all of their respective properties and assets reflected in
the financial statements referred to in subsection 5.3 or in the most recent
financial statements delivered pursuant to subsection 6.1, in each case except
for assets disposed of since the date of such financial statements in the
ordinary course of business or as otherwise permitted under subsection 7.7.
Except as permitted by this Agreement, all such properties and assets are free
and clear of Liens.
B. REAL PROPERTY. As of the Closing Date, SCHEDULE 5.5 annexed hereto
contains a true, accurate and complete list of (i) all real properties owned by
Company or any of its Subsidiaries in fee and (ii) all leases, subleases or
assignments of leases (together with all amendments, modifications, supplements,
renewals or extensions of any thereof) affecting each Real Property Asset of any
Loan Party, regardless of whether such Loan Party is the landlord or tenant
(whether directly or as an assignee or successor in interest) under such lease,
sublease or assignment. Except as specified in SCHEDULE 5.5 annexed hereto, each
agreement listed in clause (ii) of the immediately preceding sentence is in full
force and effect and Company does not have knowledge of any default that has
occurred and is continuing thereunder, and each such agreement constitutes the
legally valid and binding obligation of each applicable Loan Party, enforceable
against such Loan Party in accordance with its terms, except as enforcement may
be
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limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to or limiting creditors' rights generally or by equitable principles.
5.6 LITIGATION; ADVERSE FACTS
Except as set forth in SCHEDULE 5.6 annexed hereto, there are
no actions, suits, proceedings, arbitrations or governmental investigations
(whether or not purportedly on behalf of Company or any of its Subsidiaries) at
law or in equity, or before or by any federal, state, municipal or other
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign (including any Environmental Claims) that are pending or, to
the knowledge of Company, threatened against or affecting Company or any of its
Subsidiaries or any property of Company or any of its Subsidiaries and that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect. Neither Company nor any of its Subsidiaries (i) is in
violation of any applicable laws (including Environmental Laws) that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect, or (ii) is subject to or in default with respect to any
final judgments, writs, injunctions, decrees, rules or regulations of any court
or any federal, state, municipal or other governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect.
5.7 PAYMENT OF TAXES
Except to the extent permitted by subsection 6.3, all tax
returns and reports of Company and its Subsidiaries required to be filed by any
of them have been timely filed, and all taxes shown on such tax returns to be
due and payable and all assessments, fees and other governmental charges upon
Company and its Subsidiaries and upon their respective properties, assets,
income, businesses and franchises which are due and payable have been paid when
due and payable. Company knows of no proposed tax assessment against Company or
any of its Subsidiaries which is not being actively contested by Company or such
Subsidiary in good faith and by appropriate proceedings; PROVIDED that such
reserves or other appropriate provisions, if any, as shall be required in
conformity with GAAP shall have been made or provided therefor.
5.8 PERFORMANCE OF AGREEMENTS; MATERIALLY ADVERSE AGREEMENTS
A. Neither Company nor any of its Subsidiaries is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any of its Contractual Obligations, and no condition
exists that, with the giving of notice or the lapse of time or both, would
constitute such a default, except where the consequences, direct or indirect, of
such default or defaults, if any, has not had and could not reasonably be
expected to have a Material Adverse Effect.
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B. Neither Company nor any of its Subsidiaries is a party to or is
otherwise subject to any agreements or instruments or any charter or other
internal restrictions which, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect.
5.9 GOVERNMENTAL REGULATION
Neither Company nor any of its Subsidiaries is subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act or the Investment Company Act of 1940 or
under any other federal or state statute or regulation which may limit its
ability to incur Indebtedness or which may otherwise render all or any portion
of the Obligations unenforceable.
5.10 SECURITIES ACTIVITIES
A. Neither Company nor any of its Subsidiaries is engaged principally,
or as one of its important activities, in the business of extending credit for
the purpose of purchasing or carrying any Margin Stock.
B. Following application of the proceeds of each Loan, not more than
25% of the value of the assets (either of Company only or of Company and its
Subsidiaries on a consolidated basis) that are subject to the restrictions on
Liens or dispositions contained in subsection 7.2 or 7.7 or subject to any
restriction contained in any agreement or instrument, between Company and any
Lender or any Affiliate of any Lender, relating to Indebtedness and within the
scope of subsection 8.2, will be Margin Stock.
5.11 EMPLOYEE BENEFIT PLANS
A. Company, each of its Subsidiaries and each of their respective ERISA
Affiliates are in compliance with all applicable provisions and requirements of
ERISA and the regulations and published interpretations thereunder with respect
to each Employee Benefit Plan, and have performed all their obligations under
each Employee Benefit Plan, except where noncompliance or nonperformance could
not reasonably be expected to result in a Material Adverse Effect. Each Employee
Benefit Plan which is intended to qualify under Section 401(a) of the Internal
Revenue Code is so qualified.
B. No ERISA Event has occurred that could reasonably be expected to
result in a Material Adverse Effect, nor is any such ERISA Event reasonably
expected to occur.
C. No Employee Benefit Plan that is or was maintained by Company or any
of its Subsidiaries provides health or welfare benefits (through the purchase of
insurance or otherwise) for any retired or former employee of Company, any of
its Subsidiaries or any of their respective ERISA Affiliates, except (i) to the
extent required under Section 4980B of the Internal Revenue Code, (ii) as set
forth in Schedule 5.11 annexed hereto, and (iii) for any such Employee Benefit
Plans acquired by Company or any of its Subsidiaries after the date hereof in
connection with a Permitted Acquisition. The accrued FAS 106 liabilities for
retiree medical benefits for all Employee Benefit Plans acquired by Company or
any of its Subsidiaries after the date hereof in
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connection with any Permitted Acquisitions, as shown on the audited financial
statements for Company and its Subsidiaries, does not exceed $1,000,000.
D. As of the Closing Date and each valuation date thereafter for any
Pension Plan, the amount of unfunded benefit liabilities (as defined in Section
4001(a)(18) of ERISA), individually or in the aggregate for all Pension Plans
(excluding for purposes of such computation any Pension Plans with respect to
which assets exceed benefit liabilities), does not exceed $3,000,000.
E. None of the Company, its Subsidiaries, or their respective ERISA
Affiliates has or has had an obligation to contribute to a "multiemployer plan"
within the meaning of Section 3(37) or 4001(a)(3) of ERISA or Section 414(f) of
the Internal Revenue Code, or to a "multiple employer plan" described in Section
413(c) of the Internal Revenue Code.
5.12 CERTAIN FEES
No broker's or finder's fee or commission will be payable with
respect to this Agreement or any of the transactions contemplated hereby, and
Company hereby indemnifies Lenders against, and agrees that it will hold Lenders
harmless from, any claim, demand or liability for any such broker's or finder's
fees alleged to have been incurred in connection herewith or therewith and any
expenses (including reasonable fees, expenses and disbursements of counsel)
arising in connection with any such claim, demand or liability.
5.13 ENVIRONMENTAL PROTECTION
Except as set forth in SCHEDULE 5.13 annexed hereto:
(i) neither Company nor any of its Subsidiaries nor any of their
respective Facilities or operations are subject to any outstanding
written order, consent decree or settlement agreement with any Person
relating to (a) any Environmental Law, (b) any Environmental Claim, or
(c) any Hazardous Materials Activity that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect;
(ii) neither Company nor any of its Subsidiaries has received any
letter or request for information under Section 104 of the
Comprehensive Environmental Response, Compensation, and Liability Act
(42 U.S.C. Section 9604) or any comparable state law that could
reasonably be expected to result in a liability to Company or any of
its Subsidiaries in excess of $100,000;
(iii) there are and, to Company's knowledge, have been no
conditions, occurrences, or Hazardous Materials Activities which could
reasonably be expected to form the basis of an Environmental Claim
against Company or any of its Subsidiaries that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect;
(iv) neither Company nor any of its Subsidiaries nor, to Company's
knowledge, any predecessor of Company or any of its Subsidiaries has
filed any notice under any
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Environmental Law indicating past or present treatment of Hazardous
Materials at any Facility, and none of Company's or any of its
Subsidiaries' operations involves the generation, transportation,
treatment, storage or disposal of hazardous waste, as defined under 40
C.F.R. Parts 260-270 or any state equivalent; and
(v) compliance with all requirements pursuant to or under
Environmental Laws will not, individually or in the aggregate, have a
reasonable possibility of giving rise to a Material Adverse Effect.
Notwithstanding anything in this subsection 5.13 to the
contrary, no event or condition has occurred or is occurring with respect to
Company or any of its Subsidiaries relating to any Environmental Law, any
Release of Hazardous Materials, or any Hazardous Materials Activity, including
any matter disclosed on SCHEDULE 5.13 annexed hereto, which individually or in
the aggregate has had or could reasonably be expected to have a Material Adverse
Effect.
5.14 EMPLOYEE MATTERS
There is no strike or work stoppage in existence or threatened
involving Company or any of its Subsidiaries that could reasonably be expected
to have a Material Adverse Effect.
5.15 SOLVENCY
Each Loan Party is and, upon the incurrence of any Obligations
by such Loan Party on any date on which this representation is made, will be,
Solvent.
5.16 MATTERS RELATING TO COLLATERAL
A. CREATION, PERFECTION AND PRIORITY OF LIENS. The execution and
delivery of the Collateral Documents by Loan Parties, together with (i) the
actions taken on or prior to the date hereof pursuant to subsections 4.1M, 4.1N,
6.8 and 6.9 and (ii) the delivery to Administrative Agent of any Pledged
Collateral not delivered to Agent at the time of execution and delivery of the
applicable Collateral Document (all of which Pledged Collateral has been so
delivered) are effective to create in favor of Administrative Agent for the
benefit of Lenders, as security for the respective Secured Obligations (as
defined in the applicable Collateral Document in respect of any Collateral), a
valid and perfected First Priority Lien on all of the Collateral, and all
filings and other actions necessary or desirable to perfect and maintain the
perfection and First Priority status of such Liens have been duly made or taken
and remain in full force and effect, other than the filing of any UCC financing
statements delivered to Administrative Agent for filing (but not yet filed) and
the periodic filing of UCC continuation statements in respect of UCC financing
statements filed by or on behalf of Administrative Agent.
B. GOVERNMENTAL AUTHORIZATIONS. No authorization, approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for either (i) the pledge or grant by any Loan Party
of the Liens purported to be created in favor of Administrative Agent pursuant
to any of the Collateral Documents or (ii) the exercise by Administrative Agent
of any rights or remedies in respect of any Collateral (whether specifically
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granted or created pursuant to any of the Collateral Documents or created or
provided for by applicable law), except for filings or recordings contemplated
by subsection 5.16A and except as may be required, in connection with the
disposition of any Pledged Collateral, by laws generally affecting the offering
and sale of securities.
C. ABSENCE OF THIRD-PARTY FILINGS. Except such as may have been filed
in favor of Administrative Agent as contemplated by subsection 5.16A, (i) no
effective UCC financing statement, fixture filing or other instrument similar in
effect covering all or any part of the Collateral is on file in any filing or
recording office and (ii) no effective filing covering all or any part of the IP
Collateral is on file in the PTO.
D. MARGIN REGULATIONS. The pledge of the Pledged Collateral pursuant to
the Collateral Documents does not violate Regulation T, U or X of the Board of
Governors of the Federal Reserve System.
E. INFORMATION REGARDING COLLATERAL. All information supplied to any
Agent by or on behalf of any Loan Party with respect to any of the Collateral
(in each case taken as a whole with respect to any particular Collateral) is
accurate and complete in all material respects.
5.17 RELATED AGREEMENTS
A. DELIVERY OF RELATED AGREEMENTS. Company has delivered to Lenders
complete and correct copies of each Related Agreement and of all exhibits and
schedules thereto.
B. WARRANTIES. Except to the extent otherwise set forth herein or in
the schedules hereto, each of the representations and warranties given by Target
and Alan M. Meckler to Company in the Merger Agreement is true and correct in
all material respects as of the date hereof (or as of any earlier date to which
such representation and warranty specifically relates) and will be true and
correct in all material respects as of the Closing Date and the Merger Date (or
as of such earlier date, as the case may be), in each case subject to the
qualifications set forth in the schedules to the Merger Agreement.
C. WARRANTIES OF COMPANY. Subject to the qualifications set forth
therein, each of the representations and warranties given by Company and Merger
Sub to Target and Alan M. Meckler in the Merger Agreement is true and correct in
all material respects as of the date hereof and will be true and correct in all
material respects as of the Closing Date and the Merger Date.
D. SURVIVAL. Notwithstanding anything in the Merger Agreement to the
contrary, the representations and warranties of Company set forth in subsections
5.17B and 5.17C shall, solely for purposes of this Agreement, survive the
Closing Date and the Merger Date for the benefit of Lenders.
5.18 DISCLOSURE
A. LOAN DOCUMENTS. No representation or warranty of any Loan Party
contained in any Loan Document or Related Agreement or in any other document,
certificate or written
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statement furnished to Lenders by or on behalf of such Loan Party for
use in connection with the transactions contemplated by this Agreement contains
any untrue statement of a material fact or omits to state a material fact (known
to such Loan Party, in the case of any document not furnished by it) necessary
in order to make the statements contained herein or therein not misleading in
light of the circumstances in which the same were made. Any projections and pro
forma financial information contained in such materials are based upon good
faith estimates and assumptions believed by Company to be reasonable at the time
made, it being recognized by Lenders that such projections as to future events
are not to be viewed as facts and that actual results during the period or
periods covered by any such projections may differ from the projected results.
There are no facts known (or which should upon the reasonable exercise of
diligence be known) to Company (other than matters of a general economic nature)
that, individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect and that have not been disclosed herein or in such
other documents, certificates and statements furnished to Lenders for use in
connection with the transactions contemplated hereby.
B. TENDER OFFER MATERIALS. The Tender Offer Materials do not contain
any untrue statement of a material fact or omit to state a material fact (known
to Company or any of its Subsidiaries, in the case of any document not furnished
by it) necessary in order to make the statements contained herein or therein not
misleading in light of the circumstances in which the same were made.
5.19 YEAR 2000 COMPLIANCE.
Company has (i) initiated a review and assessment of its and its
Subsidiaries' business and operations (including those affected by suppliers and
vendors) that Company believes could be adversely affected by the "Year 2000
Problem" (that is, the risk that computer applications used by Company or
Subsidiaries may be unable to recognize and perform properly date-sensitive
functions involving certain dates prior to and any date after December 31,
1999), (ii) developed a plan and timeline for addressing the Year 2000 Problem
on a timely basis, and (iii) to date, implemented that plan substantially in
accordance with that timetable. Company believes that its own computer
applications that are material to its or its Subsidiaries' business and
operations will on a timely basis be able to perform properly date-sensitive
functions for all dates before and after January 1, 2000 (that is, be "Year 2000
compliant") except to the extent that a failure to do so could not reasonably be
expected to have Material Adverse Effect.
SECTION 6. COMPANY'S AFFIRMATIVE COVENANTS
Company covenants and agrees that, so long as any of the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations and the cancellation or expiration of all Letters of
Credit, unless Requisite Lenders shall otherwise give prior written consent,
Company shall perform, and shall cause each of its Subsidiaries to perform, all
covenants in this Section 6.
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6.1 FINANCIAL STATEMENTS AND OTHER REPORTS
Company will maintain, and cause each of its Subsidiaries to
maintain, a system of accounting established and administered in accordance with
sound business practices to permit preparation of financial statements in
conformity with GAAP. Company will deliver to Administrative Agent:
(i) MONTHLY FINANCIALS: as soon as available and in any event within
20 days after the end of each month ending after the Closing Date, the
consolidated balance sheets of Company and its Subsidiaries and Target
and its Subsidiaries as at the end of such month and the related
consolidated statements of income, stockholders' equity and cash flows
of Company and its Subsidiaries and Target and its Subsidiaries for
such month and for the period from the beginning of the then current
Fiscal Year to the end of such month, setting forth in each case in
comparative form the corresponding figures for the corresponding
periods of the previous Fiscal Year and, with respect to the statement
of income, the corresponding figures from the Financial Plan for the
current Fiscal Year, to the extent prepared on a monthly basis, all in
reasonable detail and certified by the chief financial officer of
Company that they fairly present, in all material respects, the
financial condition of Company and its Subsidiaries and Target and its
Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated, subject to
changes resulting from audit and normal year-end adjustments;
(ii) QUARTERLY FINANCIALS: as soon as available and in any event
within 45 days after the end of each Fiscal Quarter, (a) the
consolidated balance sheets of Company and its Subsidiaries as at the
end of such Fiscal Quarter and the related consolidated statements of
income, stockholders' equity and cash flows of Company and its
Subsidiaries and Target and its Subsidiaries for such Fiscal Quarter
and for the period from the beginning of the then current Fiscal Year
to the end of such Fiscal Quarter, setting forth in each case in
comparative form the corresponding figures for the corresponding
periods of the previous Fiscal Year and, with respect to the statement
of income, the corresponding figures from the Financial Plan for the
current Fiscal Year, all in reasonable detail and certified by the
chief financial officer of Company that they fairly present, in all
material respects, the financial condition of Company and its
Subsidiaries and Target and its Subsidiaries as at the dates indicated
and the results of their operations and their cash flows for the
periods indicated, subject to changes resulting from audit and normal
year-end adjustments, and (b) a narrative report describing the
operations of Company and its Subsidiaries in the form prepared for
presentation to senior management for such Fiscal Quarter and for the
period from the beginning of the then current Fiscal Year to the end of
such Fiscal Quarter;
(iii) YEAR-END FINANCIALS: as soon as available and in any event
within 90 days after the end of each Fiscal Year, (a) the consolidated
balance sheets of Company and its Subsidiaries and Target and its
Subsidiaries as at the end of such Fiscal Year and the related
consolidated statements of income, stockholders' equity and cash flows
of Company and its Subsidiaries and Target and its Subsidiaries for
such Fiscal Year, setting
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forth in each case in comparative form the corresponding figures for
the previous Fiscal Year and, with respect to the statement of income,
the corresponding figures from the Financial Plan for the Fiscal Year
covered by such financial statements, all in reasonable detail and
certified by the chief financial officer of Company that they fairly
present, in all material respects, the financial condition of Company
and its Subsidiaries and Target and its Subsidiaries as at the dates
indicated and the results of their operations and their cash flows for
the periods indicated, (b) a narrative report describing the operations
of Company and its Subsidiaries in the form prepared for presentation
to senior management for such Fiscal Year, and (c) in the case of such
consolidated financial statements of Company and its Subsidiaries, a
report thereon of PriceWaterhouseCoopers or other independent certified
public accountants of recognized national standing selected by Company
and satisfactory to Agent, which report shall be unqualified, shall
express no doubts about the ability of Company and its Subsidiaries to
continue as a going concern, and shall state that such consolidated
financial statements fairly present, in all material respects, the
consolidated financial position of Company and its Subsidiaries as at
the dates indicated and the results of their operations and their cash
flows for the periods indicated in conformity with GAAP applied on a
basis consistent with prior years (except as otherwise disclosed in
such financial statements) and that the examination by such accountants
in connection with such consolidated financial statements has been made
in accordance with generally accepted auditing standards;
(iv) OFFICERS' MARGIN DETERMINATION AND COMPLIANCE CERTIFICATES:
together with each delivery of financial statements of Company and its
Subsidiaries pursuant to subdivisions (i), (ii) and (iii) above, (a) an
Officers' Certificate of Company stating that the signers have reviewed
the terms of this Agreement and have made, or caused to be made under
their supervision, a review in reasonable detail of the transactions
and condition of Company and its Subsidiaries during the accounting
period covered by such financial statements and that such review has
not disclosed the existence during or at the end of such accounting
period, and that the signers do not have knowledge of the existence as
at the date of such Officers' Certificate, of any condition or event
that constitutes an Event of Default or Potential Event of Default, or,
if any such condition or event existed or exists, specifying the nature
and period of existence thereof and what action Company has taken, is
taking and proposes to take with respect thereto; (b) a Margin
Determination Certificate demonstrating in reasonable detail the
Consolidated Leverage Ratio for the last day of the accounting period
covered by such financial statements; and (c) a Compliance Certificate
demonstrating in reasonable detail compliance during and at the end of
the applicable accounting periods with the restrictions contained in
Section 7, in each case to the extent compliance with such restrictions
is required to be tested at the end of the applicable accounting
period;
(v) RECONCILIATION STATEMENTS: if, as a result of any change in
accounting principles and policies from those used in the preparation
of the audited financial statements referred to in subsection 5.3, the
consolidated financial statements of Company and its Subsidiaries
delivered pursuant to subdivisions (i), (ii), (iii) or (xiii) of this
subsection 6.1 will differ in any material respect from the
consolidated financial statements
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that would have been delivered pursuant to such subdivisions had no
such change in accounting principles and policies been made, then (a)
together with the first delivery of financial statements pursuant to
subdivision (i), (ii), (iii) or (xiii) of this subsection 6.1 following
such change, consolidated financial statements of Company and its
Subsidiaries for (y) the current Fiscal Year to the effective date of
such change and (z) the two full Fiscal Years immediately preceding the
Fiscal Year in which such change is made, in each case prepared on a
pro forma basis as if such change had been in effect during such
periods, and (b) together with each delivery of financial statements
pursuant to subdivision (i), (ii), (iii) or (xiii) of this subsection
6.1 following such change, a written statement of the chief accounting
officer or chief financial officer of Company setting forth the
differences (including any differences that would affect any
calculations relating to the financial covenants set forth in
subsection 7.6) which would have resulted if such financial statements
had been prepared without giving effect to such change;
(vi) ACCOUNTANTS' CERTIFICATION: together with each delivery of
consolidated financial statements of Company and its Subsidiaries
pursuant to subdivision (iii) above, a written statement by the
independent certified public accountants giving the report thereon (a)
stating that their audit examination has included a review of the terms
of this Agreement and the other Loan Documents as they relate to
accounting matters, (b) stating whether, in connection with their audit
examination, any condition or event that constitutes an Event of
Default or Potential Event of Default has come to their attention and,
if such a condition or event has come to their attention, specifying
the nature and period of existence thereof; provided that such
accountants shall not be liable by reason of any failure to obtain
knowledge of any such Event of Default or Potential Event of Default
that would not be disclosed in the course of their audit examination,
and (c) stating that based on their audit examination nothing has come
to their attention that causes them to believe either or both that the
information contained in the certificates delivered therewith pursuant
to subdivision (iv) above is not correct or that the matters set forth
in the Compliance Certificates delivered therewith pursuant to clause
(b) of subdivision (iv) above for the applicable Fiscal Year are not
stated in accordance with the terms of this Agreement;
(vii) ACCOUNTANTS' REPORTS: promptly upon receipt thereof (unless
restricted by applicable professional standards), copies of all reports
submitted to Company by independent certified public accountants in
connection with each annual, interim or special audit of the financial
statements of Company and its Subsidiaries made by such accountants,
including, without limitation, any comment letter submitted by such
accountants to management in connection with their annual audit;
(viii) SEC FILINGS AND PRESS RELEASES: promptly upon their becoming
available, copies of (a) all financial statements, reports, notices and
proxy statements sent or made available generally by Company to its
security holders or by any Subsidiary of Company to its security
holders other than Company or another Subsidiary of Company, (b) all
regular and periodic reports and all registration statements (other
than on Form S-8 or a similar form) and prospectuses, if any, filed by
Company or any of its Subsidiaries with any
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securities exchange or with the Securities and Exchange Commission or
any governmental or private regulatory authority, and (c) all press
releases and other statements made available generally by Company or
any of its Subsidiaries to the public concerning material developments
in the business of Company or any of its Subsidiaries;
(ix) EVENTS OF DEFAULT, ETC.: promptly upon any officer of Company
obtaining knowledge (a) of any condition or event that constitutes an
Event of Default or Potential Event of Default, or becoming aware that
any Lender has given any notice (other than to Administrative Agent) or
taken any other action with respect to a claimed Event of Default or
Potential Event of Default, (b) that any Person has given any notice to
Company or any of its Subsidiaries or taken any other action with
respect to a claimed default or event or condition of the type referred
to in subsection 8.2, (c) of any condition or event that would be
required to be disclosed in a current report filed by Company with the
Securities and Exchange Commission on Form 8-K (Items 1, 2, 4, 5 and 6
of such Form as in effect on the date hereof) if Company were required
to file such reports under the Exchange Act, or (d) of the occurrence
of any event or change that has caused or evidences, either in any case
or in the aggregate, a Material Adverse Effect, an Officers'
Certificate specifying the nature and period of existence of such
condition, event or change, or specifying the notice given or action
taken by any such Person and the nature of such claimed Event of
Default, Potential Event of Default, default, event or condition, and
what action Company has taken, is taking and proposes to take with
respect thereto;
(x) LITIGATION OR OTHER PROCEEDINGS: (a) promptly upon any officer
of Company obtaining knowledge of (X) the institution of, or
non-frivolous threat of, any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration against or affecting Company or any of its Subsidiaries or
any property of Company or any of its Subsidiaries (collectively,
"Proceedings") not previously disclosed in writing by Company to
Lenders or (Y) any material development in any Proceeding that, in any
case:
(1) if adversely determined, could reasonably be
expected to give rise to a Material Adverse Effect; or
(2) seeks to enjoin or otherwise prevent the
consummation of, or to recover any damages or obtain relief as
a result of, the transactions contemplated hereby;
written notice thereof together with such other information as may be
reasonably available to Company to enable Lenders and their counsel to
evaluate such matters; and (b) within twenty days after the end of each
Fiscal Quarter, a schedule of all Proceedings involving an alleged
liability of, or claims against or affecting, Company or any of its
Subsidiaries equal to or greater than $500,000, and promptly after
request by any Agent such other information as may be reasonably
requested by such Agent to enable such Agent and its counsel to
evaluate any of such Proceedings;
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(xi) ERISA EVENTS: promptly upon becoming aware of the occurrence of
or forthcoming occurrence of any ERISA Event, a written notice
specifying the nature thereof, what action Company, any of its
Subsidiaries or any of their respective ERISA Affiliates has taken, is
taking or proposes to take with respect thereto and, when known, any
action taken or threatened by the Internal Revenue Service, the
Department of Labor or the PBGC with respect thereto;
(xii) ERISA NOTICES: with reasonable promptness, copies of (a) each
Schedule B (Actuarial Information) to the annual report (Form 5500
Series) filed by Company, any of its Subsidiaries or any of their
respective ERISA Affiliates with the Internal Revenue Service with
respect to each Pension Plan; (b) all notices received by Company, any
of its Subsidiaries or any of their respective ERISA Affiliates from a
Multiemployer Plan sponsor concerning an ERISA Event; and (c) copies of
such other documents or governmental reports or filings relating to any
Employee Benefit Plan as Administrative Agent shall reasonably request;
(xiii) FINANCIAL PLANS: as soon as practicable and in any event no
later than 30 days prior to the beginning of each Fiscal Year, a
consolidated and consolidating plan and financial forecast for such
Fiscal Year and the next three succeeding Fiscal Years (the "FINANCIAL
PLAN" for such Fiscal Years), including (a) forecasted consolidated
balance sheets and forecasted consolidated and consolidating statements
of income and cash flows of Company and its Subsidiaries for each such
Fiscal Year, together with pro forma Compliance Certificates for each
such Fiscal Year and an explanation of the assumptions on which such
forecasts are based, (b) forecasted consolidated and consolidating
statements of income and cash flows of Company and its Subsidiaries for
each month of each such Fiscal Year, together with an explanation of
the assumptions on which such forecasts are based, (c) the amount of
forecasted unallocated overhead for each such Fiscal Year, and (d) such
other information and projections as any Lender may reasonably request;
(xiv) INSURANCE: as soon as practicable and in any event by the last
day of each Fiscal Year, a report in form and substance satisfactory to
Agent outlining all material insurance coverage maintained as of the
date of such report by Company and its Subsidiaries and all material
insurance coverage planned to be maintained by Company and its
Subsidiaries in the immediately succeeding Fiscal Year;
(xv) BOARD OF DIRECTORS: with reasonable promptness, written notice
of any change in the Board of Directors of Company;
(xvi) NEW SUBSIDIARIES: promptly upon any Person becoming a
Subsidiary of Company, a written notice setting forth with respect to
such Person (a) the date on which such Person became a Subsidiary of
Company and (b) all of the data required to be set forth in SCHEDULE
5.1 annexed hereto with respect to all Subsidiaries of Company (it
being understood that such written notice shall be deemed to supplement
SCHEDULE 5.1 annexed hereto for all purposes of this Agreement);
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(xvii) UCC SEARCH REPORT: As promptly as practicable after the date
of delivery to Administrative Agent of any UCC financing statement
executed by any Loan Party pursuant to subsection 4.1N(iv) or 6.8A,
copies of completed UCC searches evidencing the proper filing,
recording and indexing of all such UCC financing statement and listing
all other effective financing statements that name such Loan Party as
debtor, together with copies of all such other financing statements not
previously delivered to Administrative Agent by or on behalf of Company
or such Loan Party; and
(xviii) OTHER INFORMATION: with reasonable promptness, such other
information and data with respect to Company or any of its Subsidiaries
as from time to time may be reasonably requested by any Lender through
Administrative Agent.
6.2 CORPORATE EXISTENCE, ETC.
Except as permitted under subsection 7.7, Company will, and will
cause each of its Subsidiaries to, at all times preserve and keep in full force
and effect its corporate existence and all rights and franchises material to its
business; PROVIDED, HOWEVER that neither Company nor any of its Subsidiaries
shall be required to preserve any such right or franchise if the Board of
Directors of Company or such Subsidiary shall determine that the preservation
thereof is no longer desirable in the conduct of the business of Company or such
Subsidiary, as the case may be, and that the loss thereof has not had and could
not reasonably be expected to have a Material Adverse Effect.
6.3 PAYMENT OF TAXES AND CLAIMS; TAX CONSOLIDATION
A. Company will, and will cause each of its Subsidiaries to, pay all
taxes, assessments and other governmental charges imposed upon it or any of its
properties or assets or in respect of any of its income, businesses or
franchises before any penalty accrues thereon, and all claims (including, claims
for labor, services, materials and supplies) for sums that have become due and
payable and that by law have or may become a Lien upon any of its properties or
assets, prior to the time when any penalty or fine shall be incurred with
respect thereto; provided that no such charge or claim need be paid if it is
being contested in good faith by appropriate proceedings promptly instituted and
diligently conducted, so long as (1) such reserve or other appropriate
provision, if any, as shall be required in conformity with GAAP shall have been
made therefor and (2) in the case of a charge or claim which has or may become a
Lien against any of the Collateral, such contest proceedings conclusively
operate to stay the sale of any portion of the Collateral to satisfy such charge
or claim.
B. Company will not, nor will it permit any of its Subsidiaries to,
file or consent to the filing of any consolidated income tax return with any
Person (other than Company or any of its Subsidiaries).
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6.4 MAINTENANCE OF PROPERTIES; INSURANCE; APPLICATION OF NET INSURANCE/
CONDEMNATION PROCEEDS
A. MAINTENANCE OF PROPERTIES. Company will, and will cause each of its
Subsidiaries to, maintain or cause to be maintained in good repair, working
order and condition, ordinary wear and tear excepted, all material properties
used or useful in the business of Company and its Subsidiaries (including all
Intellectual Property) and from time to time will make or cause to be made all
appropriate repairs, renewals and replacements thereof.
B. INSURANCE. Company will maintain or cause to be maintained, with
financially sound and reputable insurers, such public liability insurance, third
party property damage insurance, business interruption insurance and casualty
insurance with respect to liabilities, losses or damage in respect of the
assets, properties and businesses of Company and its Subsidiaries as may
customarily be carried or maintained under similar circumstances by corporations
of established reputation engaged in similar businesses, in each case in such
amounts (giving effect to self-insurance), with such deductibles, covering such
risks and otherwise on such terms and conditions as shall be customary for
corporations similarly situated in the industry. Without limiting the generality
of the foregoing, Company will maintain or cause to be maintained (i) flood
insurance with respect to each Flood Hazard Property that is located in a
community that participates in the National Flood Insurance Program, in each
case in compliance with any applicable regulations of the Board of Governors of
the Federal Reserve System, and (ii) replacement value casualty insurance on the
Collateral under such policies of insurance, with such insurance companies, in
such amounts, with such deductibles, and covering such risks as are at all times
satisfactory to Agents in their commercially reasonable judgment. Each such
policy of insurance shall (a) name Administrative Agent for the benefit of
Lenders as an additional insured thereunder as its interests may appear and (b)
in the case of each business interruption and casualty insurance policy, contain
a loss payable clause or endorsement, satisfactory in form and substance to
Administrative Agent, that names Administrative Agent for the benefit of Lenders
as the loss payee thereunder for any covered loss in excess of $1,000,000 and
provides for at least 30 days prior written notice to Administrative Agent of
any modification or cancellation of such policy.
C. APPLICATION OF NET INSURANCE/CONDEMNATION PROCEEDS.
(i) BUSINESS INTERRUPTION INSURANCE. Upon receipt by Company or any
of its Subsidiaries of any business interruption insurance proceeds
constituting Net Insurance/Condemnation Proceeds, (a) so long as no
Event of Default or Potential Event of Default shall have occurred and
be continuing, Company or such Subsidiary may retain and apply such Net
Insurance/Condemnation Proceeds for working capital purposes, and (b)
if an Event of Default or Potential Event of Default shall have
occurred and be continuing, Company shall apply an amount equal to such
Net Insurance/Condemnation Proceeds to prepay the Loans (and/or the
Revolving Loan Commitments shall be reduced) as provided in subsection
2.4B(iii)(b);
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(ii) CASUALTY INSURANCE/CONDEMNATION PROCEEDS. Upon receipt by
Company or any of its Subsidiaries of any Net Insurance/Condemnation
Proceeds other than from business interruption insurance, (a) so long
as no Event of Default or Potential Event of Default shall have
occurred and be continuing, Company shall, or shall cause one or more
of its Subsidiaries to, promptly and diligently apply such Net
Insurance/Condemnation Proceeds to pay or reimburse the costs of
repairing, restoring or replacing the assets in respect of which such
Net Insurance/Condemnation Proceeds were received or, to the extent not
so applied, to prepay the Loans (and/or the Revolving Loan Commitments
shall be reduced) as provided in subsection 2.4B(iii)(b), and (b) if an
Event of Default or Potential Event of Default shall have occurred and
be continuing, Company shall apply an amount equal to such Net
Insurance/Condemnation Proceeds to prepay the Loans (and/or the
Revolving Loan Commitments shall be reduced) as provided in subsection
2.4B(iii)(b).
(iii) NET INSURANCE/CONDEMNATION PROCEEDS RECEIVED BY ADMINISTRATIVE
AGENT. Upon receipt by Administrative Agent of any Net
Insurance/Condemnation Proceeds as loss payee, if the aggregate amount
of Net Insurance/Condemnation Proceeds received (and reasonably
expected to be received) by Administrative Agent in respect of any
covered loss does not exceed $5,000,000, Administrative Agent shall
deliver such Net Insurance/Condemnation Proceeds to Company, and
Company shall, or shall cause one or more of its Subsidiaries to,
promptly apply such Net Insurance/Condemnation Proceeds to the costs of
repairing, restoring, or replacing the assets in respect of which such
Net Insurance/Condemnation Proceeds were received, and (2) if the
aggregate amount of Net Insurance/Condemnation Proceeds received (and
reasonably expected to be received) by Administrative Agent in respect
of any covered loss exceeds $5,000,000, Administrative Agent shall hold
such Net Insurance/Condemnation Proceeds pursuant to the terms of the
Collateral Account Agreement and, so long as Company or any of its
Subsidiaries proceeds diligently to repair, restore or replace the
assets of Company or such Subsidiary in respect of which such Net
Insurance/Condemnation Proceeds were received, Administrative Agent
shall from time to time disburse to Company or such Subsidiary from the
Collateral Account, to the extent of any such Net
Insurance/Condemnation Proceeds remaining therein in respect of the
applicable covered loss, amounts necessary to pay the cost of such
repair, restoration or replacement after the receipt by Administrative
Agent of invoices or other documentation reasonably satisfactory to
Administrative Agent relating to the amount of costs so incurred and
the work performed (including, if required by Administrative Agent,
lien releases and architects' certificates); provided, however that if
at any time Administrative Agent reasonably determines (A) that Company
or such Subsidiary is not proceeding diligently with such repair,
restoration or replacement or (B) that such repair, restoration or
replacement cannot be completed with the Net Insurance/Condemnation
Proceeds then held by Administrative Agent for such purpose, together
with funds otherwise available to Company for such purpose, or that
such repair, restoration or replacement cannot be completed within 180
days after the receipt by Administrative Agent of such Net
Insurance/Condemnation Proceeds, Administrative Agent shall, and
Company hereby authorizes Administrative Agent to, apply such Net
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Insurance/ Condemnation Proceeds to prepay the Loans (and/or the
Revolving Loan Commitments shall be reduced) as provided in subsection
2.4B(iii)(b).
6.5 INSPECTION RIGHTS; APPRAISALS OF REAL ESTATE; LENDER MEETING
A. INSPECTION RIGHTS. Company shall, and shall cause each of its
Subsidiaries to, permit any authorized representatives designated by any Lender
through Administrative Agent to visit and inspect any of the properties of
Company or of any of its Subsidiaries, to inspect, copy and take extracts from
its and their financial and accounting records, and to discuss its and their
affairs, finances and accounts with its and their officers and independent
public accountants (provided that Company may, if it so chooses, be present at
or participate in any such discussion), all upon reasonable notice and at such
reasonable times during normal business hours and as often as may reasonably be
requested.
B. REAL ESTATE APPRAISALS. Company shall, and shall cause each of its
Subsidiaries to, permit an independent real estate appraiser satisfactory to
Agents, upon reasonable notice, to visit and inspect any Mortgaged Property for
the purpose of preparing an appraisal of such Mortgaged Property. Company shall
not be obligated to reimburse Administrative Agent for the costs and expenses
incurred for more than one appraisal of each Mortgaged Property conducted during
the term of this Agreement, other than appraisals conducted after the occurrence
and during the continuance of an Event of Default and appraisals needed to
satisfy the requirements of any applicable laws and regulations, as determined
by Agents in their discretion.
C. LENDER MEETING. Company will, upon the request of Agents or
Requisite Lenders, participate in a meeting of Agents and Lenders once during
each Fiscal Year to be held at Company's corporate offices (or at such other
location as may be agreed to by Company and Agents) at such time as may be
agreed to by Company and Agents.
6.6 COMPLIANCE WITH LAWS, ETC.
Company shall comply, and shall cause each of its and all other
Persons on or occupying any Facilities to comply, with the requirements of all
applicable laws, rules, regulations and orders of any governmental authority
(including all Environmental Laws), noncompliance with which could reasonably be
expected to cause, individually or in the aggregate, a Material Adverse Effect.
6.7 ENVIRONMENTAL REVIEW AND INVESTIGATION, DISCLOSURE, ETC.; COMPANY'S
ACTIONS REGARDING HAZARDOUS MATERIALS ACTIVITIES, ENVIRONMENTAL CLAIMS AND
VIOLATIONS OF ENVIRONMENTAL LAWS; ENVIRONMENTAL INDEMNITY
A. ENVIRONMENTAL REVIEW AND INVESTIGATION. Company agrees that any
Agent may, from time to time and in its reasonable discretion, (i) retain, at
Company's expense, an independent professional consultant to review any
environmental audits, investigations, analyses and reports relating to Hazardous
Materials prepared by or for Company and (ii) conduct, at Company's expense, its
own investigation of any Facility; provided that, in the case of any Facility
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no longer owned, leased, operated or used by Company or any of its Subsidiaries,
Company shall only be obligated to use its best efforts to obtain permission for
such Agent's professional consultant to conduct an investigation of such
Facility. For purposes of conducting such a review and/or investigation, Company
hereby grants to each Agent and its agents, employees, consultants and
contractors the right to enter into or onto any Facilities currently owned,
leased, operated or used by Company or any of its Subsidiaries and to perform
such tests on such property (including taking samples of soil, groundwater and
suspected asbestos-containing materials) as are reasonably necessary in
connection therewith. Any such investigation of any Facility shall be conducted,
unless otherwise agreed to by Company and the applicable Agent, during normal
business hours and, to the extent reasonably practicable, shall be conducted so
as not to interfere with the ongoing operations at such Facility or to cause any
damage or loss to any property at such Facility. Company and Agents hereby
acknowledge and agree that any report of any investigation conducted at the
request of such Agent pursuant to this subsection 6.7A will be obtained and
shall be used by any Agent and Lenders for the purposes of Lenders' internal
credit decisions, to monitor and police the Loans and to protect Lenders'
security interests, if any, created by the Loan Documents. Each Agent agrees to
deliver a copy of any such report to Company with the understanding that Company
acknowledges and agrees that (x) it will indemnify and hold harmless Agents and
each Lender from any costs, losses or liabilities relating to Company's use of
or reliance on such report, (y) neither any Agent nor any Lender makes any
representation or warranty with respect to such report, and (z) by delivering
such report to Company, neither any Agent nor any Lender is requiring or
recommending the implementation of any suggestions or recommendations contained
in such report.
B. ENVIRONMENTAL DISCLOSURE. Company will deliver to Administrative
Agent and Lenders:
(i) ENVIRONMENTAL AUDITS AND REPORTS. As soon as practicable
following receipt thereof, copies of all environmental audits,
investigations, analyses and reports of any kind or character, whether
prepared by personnel of Company or any of its Subsidiaries or by
independent consultants, governmental authorities or any other Persons,
with respect to significant environmental matters at any Facility
which, individually or in the aggregate, could reasonably be expected
to result in a Material Adverse Effect or with respect to any
Environmental Claims which, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect;
(ii) NOTICE OF CERTAIN RELEASES, REMEDIAL ACTIONS, ETC.. Promptly
upon the occurrence thereof, written notice describing in reasonable
detail (a) any Hazardous Materials Activities required to be reported
to any federal, state or local governmental or regulatory agency under
any applicable Environmental Laws that could reasonably be expected to
result in a Material Adverse Effect, (b) any remedial action taken by
Company or any other Person in response to (1) any Hazardous Materials
Activities the existence of which has a reasonable possibility of
resulting in one or more Environmental Claims having, individually or
in the aggregate, a Material Adverse Effect, or (2) any Environmental
Claims that, individually or in the aggregate, have a reasonable
possibility of resulting in a Material Adverse Effect.
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(iii) WRITTEN COMMUNICATIONS REGARDING ENVIRONMENTAL CLAIMS,
RELEASES, ETC. As soon as practicable following the sending or receipt
thereof by Company or any of its Subsidiaries, a copy of any and all
written communications with any Person other than Company, its
Subsidiaries, and their authorized agents with respect to (a) any
Environmental Claims that, individually or in the aggregate, have a
reasonable possibility of giving rise to a Material Adverse Effect, (b)
any Release required to be reported to any federal, state or local
governmental or regulatory agency, and (c) any request for information
from any governmental agency that suggests such agency is investigating
whether Company or any of its Subsidiaries may be potentially
responsible for any Hazardous Materials Activity.
(iv) NOTICE OF CERTAIN PROPOSED ACTIONS HAVING ENVIRONMENTAL IMPACT.
Prompt written notice describing in reasonable detail (a) any proposed
acquisition of stock, assets, or property by Company or any of its
Subsidiaries that could reasonably be expected to (1) expose Company or
any of its Subsidiaries to, or result in, Environmental Claims that
could reasonably be expected to have, individually or in the aggregate,
a Material Adverse Effect or (2) affect the ability of Company or any
of its Subsidiaries to maintain in full force and effect all material
Governmental Authorizations required under any Environmental Laws for
their respective operations and (b) any proposed action to be taken by
Company or any of its Subsidiaries to commence manufacturing or other
industrial operations or to modify current operations in a manner that
could reasonably be expected to subject Company or any of its
Subsidiaries to any additional material obligations or material
requirements under any Environmental Laws.
(v) OTHER INFORMATION. With reasonable promptness, such other
documents and information as from time to time may be reasonably
requested by any Agent in relation to any matters disclosed pursuant to
this subsection 6.7; PROVIDED however, that Company shall not be
obligated to disclose any information pursuant to this clause (v) that
is protected by the attorney-client privilege.
C. COMPANY'S ACTIONS REGARDING HAZARDOUS MATERIALS ACTIVITIES,
ENVIRONMENTAL CLAIMS AND VIOLATIONS OF ENVIRONMENTAL LAWS.
(i) REMEDIAL ACTIONS RELATING TO HAZARDOUS MATERIALS ACTIVITIES.
Company shall promptly undertake, and shall cause each of its
Subsidiaries promptly to undertake, any and all investigations,
studies, sampling, testing, abatement, cleanup, removal, remediation or
other response actions necessary to remove, remediate, clean up or
abate any Hazardous Materials Activity on, under or about any Facility
that is in violation of any Environmental Laws or that presents a
material risk of giving rise to an Environmental Claim. In the event
Company or any of its Subsidiaries undertakes any such action with
respect to any Hazardous Materials, Company or such Subsidiary shall
conduct and complete such action in compliance with all applicable
Environmental Laws except when, and only to the extent that, Company's
or such Subsidiary's liability with respect to such Hazardous Materials
Activity is being contested in good faith by Company or such
Subsidiary.
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(ii) ACTIONS WITH RESPECT TO ENVIRONMENTAL CLAIMS AND VIOLATIONS OF
ENVIRONMENTAL LAWS. Company shall promptly take, and shall cause each
of its Subsidiaries promptly to take, any and all actions necessary to
(a) cure any material violation of applicable Environmental Laws by
Company or its Subsidiaries and (b) make an appropriate response to any
Environmental Claim against Company or any of its Subsidiaries and
discharge any obligations it may have to any Person thereunder.
D. ENVIRONMENTAL INDEMNITY. If requested by any Agent, Company shall
execute and deliver to Administrative Agent an environmental indemnity
agreement, satisfactory in form and substance to such Agent and its counsel,
with respect to the indemnification of Agents and Lenders for any liabilities
that may be imposed on or incurred by any of them as a result of any Hazardous
Materials Activity.
6.8 EXECUTION OF SUBSIDIARY GUARANTY AND PERSONAL PROPERTY COLLATERAL
DOCUMENTS BY CERTAIN SUBSIDIARIES AND FUTURE SUBSIDIARIES
A. EXECUTION OF SUBSIDIARY GUARANTY AND PERSONAL PROPERTY COLLATERAL
DOCUMENTS. In the event that any Person becomes a Domestic Subsidiary of Company
after the date hereof, Company will promptly notify Administrative Agent of that
fact and cause such Subsidiary to execute and deliver to Administrative Agent a
counterpart of the Subsidiary Guaranty and a Subsidiary Pledge Agreement and a
Subsidiary Security Agreement and to take all such further actions and execute
all such further documents and instruments (including without limitation
actions, documents and instruments comparable to those described in subsection
4.1N) as may be necessary or, in the opinion of Administrative Agent, desirable
to create in favor of Administrative Agent, for the benefit of Lenders, a valid
and perfected First Priority Lien on all of the personal and mixed property
assets of such Subsidiary described in the applicable forms of Collateral
Documents.
B. SUBSIDIARY CHARTER DOCUMENTS, LEGAL OPINIONS, ETC. Company shall
deliver to Administrative Agent, together with such Loan Documents, (i)
certified copies of such Subsidiary's Certificate or Articles of Incorporation,
together with a good standing certificate from the Secretary of State of the
jurisdiction of its incorporation and each other state in which such Person is
qualified as a foreign corporation to do business and, to the extent generally
available, a certificate or other evidence of good standing as to payment of any
applicable franchise or similar taxes from the appropriate taxing authority of
each of such jurisdictions, each to be dated a recent date prior to their
delivery to Administrative Agent, (ii) a copy of such Subsidiary's Bylaws,
certified by its corporate secretary or an assistant secretary as of a recent
date prior to their delivery to Administrative Agent, (iii) a certificate
executed by the secretary or an assistant secretary of such Subsidiary as to (a)
the fact that the attached resolutions of the Board of Directors of such
Subsidiary approving and authorizing the execution, delivery and performance of
such Loan Documents are in full force and effect and have not been modified or
amended and (b) the incumbency and signatures of the officers of such Subsidiary
executing such Loan Documents, and (iv) if either the purchase price paid by
Company or its Subsidiaries for such Subsidiary, the fair market value of such
Subsidiary's assets, or the projected annual revenues for such Subsidiary, is
$5,000,000 or greater, a favorable opinion of counsel to such
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Subsidiary, in form and substance satisfactory to each Agent and its counsel, as
to (a) the due organization and good standing of such Subsidiary, (b) the due
authorization, execution and delivery by such Subsidiary of such Loan Documents,
(c) the enforceability of such Loan Documents against such Subsidiary, (d) such
other matters (including without limitation matters relating to the creation and
perfection of Liens in any Collateral pursuant to such Loan Documents) as any
Agent may reasonably request, all of the foregoing to be satisfactory in form
and substance to such Agent and its counsel.
6.9 CONFORMING LEASEHOLD INTERESTS; MATTERS RELATING TO ADDITIONAL REAL
PROPERTY COLLATERAL
A. CONFORMING LEASEHOLD INTERESTS. If Company or any of its
Subsidiaries acquires any Material Leasehold Property, Company shall, or shall
cause such Subsidiary to, cause such Material Leasehold Property to be a
Conforming Leasehold Interest.
B. ADDITIONAL MORTGAGES, ETC. From and after the Closing Date, in the
event that (i) Company or any Subsidiary Guarantor acquires any fee interest in
real property or any Material Leasehold Property or (ii) at the time any Person
becomes a Subsidiary Guarantor, such Person owns or holds any fee interest in
real property or any Material Leasehold Property, in either case excluding any
such Real Property Asset the encumbrancing of which requires the consent of any
applicable lessor or (in the case of clause (ii) above) then-existing senior
lienholder, where Company and its Subsidiaries are unable to obtain such
lessor's or senior lienholder's consent (any such non-excluded Real Property
Asset described in the foregoing clause (i) or (ii) being an "ADDITIONAL
MORTGAGED PROPERTY"), Company or such Subsidiary Guarantor shall deliver to
Administrative Agent, as soon as practicable after such Person acquires such
Additional Mortgaged Property or becomes a Subsidiary Guarantor, as the case may
be, the following:
(i) ADDITIONAL MORTGAGE. A fully executed and notarized Mortgage (an
"ADDITIONAL MORTGAGE"), in proper form for recording in all appropriate
places in all applicable jurisdictions, encumbering the interest of
such Loan Party in such Additional Mortgaged Property;
(ii) OPINIONS OF COUNSEL. (a) A favorable opinion of counsel to such
Loan Party, in form and substance satisfactory to Agents and their
respective counsel, as to the due authorization, execution and delivery
by such Loan Party of such Additional Mortgage and such other matters
as Agents may reasonably request, and (b) if required by Agents, an
opinion of counsel (which counsel shall be reasonably satisfactory to
Agents) in the state in which such Additional Mortgaged Property is
located with respect to the enforceability of such Additional Mortgage
and such other matters (including without limitation any matters
governed by the laws of such state regarding personal property security
interests in respect of any Collateral) as Agents may reasonably
request, in each case in form and substance reasonably satisfactory to
Agents;
(iii) LANDLORD CONSENT AND ESTOPPEL; RECORDED LEASEHOLD INTEREST. In
the case of an Additional Mortgaged Property consisting of a Material
Leasehold Property, (a) a
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Landlord Consent and Estoppel and (b) evidence that such Material
Leasehold Property is a Recorded Leasehold Interest;
(iv) TITLE INSURANCE. (a) If required by any Agent, an ALTA
mortgagee title insurance policy or an unconditional commitment
therefor (an "ADDITIONAL MORTGAGE POLICY") issued by the Title Company
with respect to such Additional Mortgaged Property, in an amount
satisfactory to Agents, insuring fee simple title to, or a valid
leasehold interest in, such Additional Mortgaged Property vested in
such Loan Party and assuring Administrative Agent that such Additional
Mortgage creates a valid and enforceable First Priority mortgage Lien
on such Additional Mortgaged Property, subject only to a standard
survey exception, which Additional Mortgage Policy (1) shall include an
endorsement for mechanics' liens, for future advances under this
Agreement and for any other matters reasonably requested by any Agent
and (2) shall provide for affirmative insurance and such reinsurance as
any Agent may reasonably request, all of the foregoing in form and
substance reasonably satisfactory to each Agent; and (b) evidence
satisfactory to each Agent that such Loan Party has (i) delivered to
the Title Company all certificates and affidavits required by the Title
Company in connection with the issuance of the Additional Mortgage
Policy and (ii) paid to the Title Company or to the appropriate
governmental authorities all expenses and premiums of the Title Company
in connection with the issuance of the Additional Mortgage Policy and
all recording and stamp taxes (including mortgage recording and
intangible taxes) payable in connection with recording the Additional
Mortgage in the appropriate real estate records;
(v) TITLE REPORT. If no Additional Mortgage Policy is required with
respect to such Additional Mortgaged Property, a title report issued by
the Title Company with respect thereto, dated not more than 30 days
prior to the date such Additional Mortgage is to be recorded and
satisfactory in form and substance to each Agent;
(vi) COPIES OF DOCUMENTS RELATING TO TITLE EXCEPTIONS. Copies of all
recorded documents listed as exceptions to title or otherwise referred
to in the Additional Mortgage Policy or title report delivered pursuant
to clause (v) above;
(vii) MATTERS RELATING TO FLOOD HAZARD PROPERTIES. (a) Evidence,
which may be in the form of a letter from an insurance broker or a
municipal engineer, as to (1) whether such Additional Mortgaged
Property is a Flood Hazard Property and (2) if so, whether the
community in which such Flood Hazard Property is located is
participating in the National Flood Insurance Program, (b) if such
Additional Mortgaged Property is a Flood Hazard Property, such Loan
Party's written acknowledgement of receipt of written notification from
Administrative Agent (1) that such Additional Mortgaged Property is a
Flood Hazard Property and (2) as to whether the community in which such
Flood Hazard Property is located is participating in the National Flood
Insurance Program, and (c) in the event such Additional Mortgaged
Property is a Flood Hazard Property that is located in a community that
participates in the National Flood Insurance Program, evidence that
Company has obtained flood insurance in respect of such Flood Hazard
Property to the
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extent required under the applicable regulations of the Board of
Governors of the Federal Reserve System; and
(viii) ENVIRONMENTAL AUDIT. If required by any Agent, reports and
other information, in form, scope and substance satisfactory to Agent
and prepared by environmental consultants satisfactory to Agents,
concerning any environmental hazards or liabilities to which Company or
any of its Subsidiaries may be subject with respect to such Additional
Mortgaged Property.
6.10 INTEREST RATE PROTECTION
At all times after the date which is 90 days after the Closing Date,
Company shall maintain in effect one or more Interest Rate Agreements with
respect to the Loans, in an aggregate notional principal amount of not less than
50% of the aggregate principal amount of Term Loans outstanding on the Tranche A
Term Loan Commitment Termination Date, which Interest Rate Agreements shall be
in form and substance satisfactory to Agents and with a term of not less than
two years.
6.11 YEAR 2000 COMPLIANCE.
Company will promptly notify Administrative Agent in the event Company
discovers or determines that any computer application (including those of its
suppliers and vendors) that is material to its or its Subsidiaries' business and
operations will not be Year 2000 compliant as of January 1, 2000, except to the
extent that such failure could not reasonably be expected to have a Material
Adverse Effect.
6.12 MERGER.
A. COMPLIANCE WITH MERGER AGREEMENT. Company shall cause Merger Sub and
Target to comply with, all covenants set forth in the Merger Agreement
applicable prior to the consummation of the Merger.
B. OBLIGATION TO CAUSE MERGER TO OCCUR. Company shall cause the Merger
to be consummated in accordance with the terms and conditions of the Merger
Agreement and the Tender Offer Materials as soon as practicable and, in any
event, no later than 150 calendar days after the Closing Date. In the event that
the Target Common Stock to be purchased concurrently with receipt of the
proceeds of the Loans on the Closing Date shall represent, in the aggregate, not
less than 90% of the outstanding shares of Target Common Stock so as to permit
Company to cause the Merger to occur in accordance with the terms of the Merger
Agreement and Section 253 of the Delaware Business Corporation Law, Company
shall cause the Merger to be consummated on the Closing Date.
C. TARGET DOCUMENTS. On or before the Merger Date, Company shall, or
shall cause Target and its Domestic Subsidiaries to, as the case may be, deliver
to Lenders (or to Administrative Agent for Lenders with sufficient originally
executed copies, where appropriate,
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for each lender and its counsel) the following (except to the extent previously
delivered pursuant to subsection 4.1), each, unless otherwise noted, dated the
Merger Date:
(i) Certified copies of the Certificate or Articles of Incorporation
of each of Target and its Domestic Subsidiaries, together with a good
standing certificate from the Secretary of State of its jurisdiction of
incorporation and each other state in which Target or any of its
Domestic Subsidiaries is qualified as a foreign corporation to do
business and, to the extent generally available, a certificate or other
evidence of good standing as to payment of any applicable franchise or
similar taxes from the appropriate taxing authority of each of such
jurisdictions, each dated a recent date prior to the Merger Date;
(ii) Copies of the Bylaws of each of Target and its Domestic
Subsidiaries, certified as of the Merger Date by such Person's
corporate secretary or an assistant secretary;
(iii) Resolutions of the Board of Directors of Target and its
Domestic Subsidiaries approving and authorizing the execution, delivery
and performance of, as the case may be, the Subsidiary Security
Agreements, the Subsidiary Guaranty and the Subsidiary Pledge
Agreements, each certified as of the Merger Date by the corporate
secretary or an assistant secretary of such Person as being in full
force and effect without modification or amendment;
(iv) Signature and incumbency certificates of the officers of Target
and its Domestic Subsidiaries executing, as the case may be, the
Subsidiary Security Agreements, the Subsidiary Guaranty, and the
Subsidiary Pledge Agreements;
(v) Originals of the Subsidiary Security Agreements, the Subsidiary
Guaranty and the Subsidiary Pledge Agreements, executed by Target and
each of its Domestic Subsidiaries; and
(vi) Such other documents as any Agent may reasonably request.
D. ACQUISITION FINANCING REQUIREMENTS. Company shall not permit the
aggregate consideration paid by Merger Sub on the Closing Date to purchase the
Tendered Target Shares, plus the aggregate consideration paid or to be paid by
Merger Sub for any shares of Target Common Stock that have been converted (or
will be converted on the Merger Date) into the right to receive a cash payment
pursuant to the Merger Agreement and to purchase any other shares of Target
Common Stock acquired in any manner whatsoever, plus the amount needed to
repurchase the Target Stock Options, to exceed $274,000,000. Company shall not
permit the aggregate amount of Transaction Costs incurred as of the Merger Date
(including any such amounts incurred on or before the Closing Date) to exceed
$16,500,000.
E. OPINIONS OF COUNSEL. On the Merger Date, Company shall deliver to
Lenders and their respective counsel (i) originally executed copies of one or
more favorable written opinions of Jones, Day, Reavis & Pogue, counsel for Loan
Parties and Target, in form and substance
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reasonably satisfactory to Agents and their counsel, dated as of the Merger Date
and setting forth substantially the matters in the opinions designated in
EXHIBIT IX annexed hereto and as to such other matters as Agents acting on
behalf of Lenders may reasonably request and (ii) evidence satisfactory to
Agents that Company has requested such counsel to deliver such opinions to
Lenders.
F. SECURITY INTERESTS IN PERSONAL AND MIXED PROPERTY. On or before the
Merger Date Administrative Agent shall have received evidence satisfactory to
Agents that Company, Surviving Corporation and Surviving Corporation's Domestic
Subsidiaries, as the case may be, shall have taken or caused to be taken all
such actions, executed and delivered or caused to be executed and delivered all
such agreements, documents and instruments, and made or caused to be made all
such filings and recordings required by subsections 6.8 and 6.9. Such actions
shall include the following:
(i) AMENDMENT TO SCHEDULES TO COLLATERAL DOCUMENTS. Delivery to
Administrative Agent of a pledge amendment to the Company Pledge
Agreement regarding all capital stock of Surviving Corporation to be
pledged by Company pursuant to the Company Pledge Agreement.
(ii) STOCK CERTIFICATES AND INSTRUMENTS. Delivery to Administrative
Agent of certificates (which certificates shall be accompanied by
irrevocable undated stock powers, duly endorsed in blank and otherwise
satisfactory in form and substance to each Agent) representing (a) all
capital stock of Surviving Corporation to be pledged pursuant to the
Company Pledge Agreement, (b) 100% of the capital stock of all Domestic
Subsidiaries of Surviving Corporation and 65% of the capital stock of
all Foreign Subsidiaries directly owned by Surviving Corporation or any
Domestic Subsidiary of Surviving Corporation and (c) all promissory
notes or other instruments (duly endorsed, where appropriate, in a
manner satisfactory to each Agent) evidencing any Collateral required
to be pledged by Surviving Corporation or any of its Domestic
Subsidiaries pursuant to the Subsidiary Pledge Agreements;
(iii) LIEN SEARCHES AND UCC TERMINATION STATEMENTS. Delivery to
Administrative Agent of (a) the results of a recent search, by a Person
satisfactory to Agents, of all effective UCC financing statements and
fixture filings and all judgment and tax lien filings which may have
been made with respect to any personal or mixed property of Surviving
Corporation and its Domestic Subsidiaries, together with copies of all
such filings disclosed by such search, and (b) UCC termination
statements duly executed by all applicable Persons for filing in all
applicable jurisdictions as may be necessary to terminate any effective
UCC financing statements or fixture filings disclosed in such search
(other than any such financing statements or fixture filings in respect
of Liens permitted to remain outstanding pursuant to the terms of this
Agreement).
(iv) UCC FINANCING STATEMENTS AND FIXTURE FILINGS. Delivery to
Administrative Agent of UCC financing statements and, where
appropriate, fixture filings, duly executed by Surviving Corporation
and its Domestic Subsidiaries with respect to all personal and
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mixed property Collateral of such Loan Party, for filing in all
jurisdictions as may be necessary or, in the opinion of Agent,
desirable to perfect the security interests created in such Collateral
pursuant to the Collateral Documents; and
(v) PTO COVER SHEETS, ETC. Delivery to Administrative Agent of all
cover sheets or other documents or instruments required to be filed
with the PTO in order to create or perfect Liens in respect of any IP
Collateral owned by Surviving Corporation and its Domestic
Subsidiaries.
SECTION 7. COMPANY'S NEGATIVE COVENANTS
Company covenants and agrees that, so long as any of the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations and the cancellation or expiration of all Letters of
Credit, unless Requisite Lenders shall otherwise give prior written consent,
Company shall perform, and shall cause each of its Subsidiaries to perform, all
covenants in this Section 7.
7.1 INDEBTEDNESS
Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create, incur, assume or guaranty, or otherwise become
or remain directly or indirectly liable with respect to, any Indebtedness,
except:
(i) Company may become and remain liable with respect to the
Obligations;
(ii) Company and its Subsidiaries may become and remain liable with
respect to Contingent Obligations permitted by subsection 7.4 and, upon
any matured obligations actually arising pursuant thereto, the
Indebtedness corresponding to the Contingent Obligations so
extinguished;
(iii) Company and its Subsidiaries may become and remain liable with
respect to Indebtedness in respect of Capital Leases in an aggregate
principal amount not to exceed $3,000,000 at any time;
(iv) Company may become and remain liable with respect to
Indebtedness to any of its wholly-owned Subsidiaries, any wholly-owned
Domestic Subsidiary of Company may become and remain liable with
respect to Indebtedness to Company or any other wholly-owned Subsidiary
of Company and Penton Media Limited, an English limited liability
company may become and remain liable with respect to Indebtedness to
Company or any other wholly-owned Subsidiary of Company; provided that
(a) all such intercompany Indebtedness shall be evidenced by promissory
notes which shall, in the case of any Indebtedness owed to Company or
any Subsidiary Guarantor, be pledged to Administrative Agent pursuant
to the Company Pledge Agreement or the applicable Subsidiary Pledge
Agreement, (b) all such intercompany Indebtedness owed by Company to
any of its Subsidiaries shall be subordinated in right of payment to
the payment in full of the Obligations pursuant to the terms of the
applicable promissory notes or an
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intercompany subordination agreement, (c) any payment by any Subsidiary
of Company under any guaranty of the Obligations shall result in a pro
tanto reduction of the amount of any intercompany Indebtedness owed by
such Subsidiary to Company or to any of its Subsidiaries for whose
benefit such payment is made, and (d) the maximum principal amount of
Indebtedness owed to Company that Penton Media Limited may incur at any
time, together with the aggregate outstanding principal amount of all
other Indebtedness owed to Company by Penton Media Limited such time,
shall not exceed $20,000,000 (including the U.S. Dollar equivalent of
amounts owed in foreign currencies at the time of such incurrence);
(v) Company and its Subsidiaries, as applicable, may remain liable
with respect to Indebtedness described in SCHEDULE 7.1 annexed hereto;
(vi) the Subsidiaries of Company may become and remain liable with
respect to Acquisition Indebtedness in an aggregate principal amount
not exceeding $5,000,000 at any time outstanding; provided that:
(a) notwithstanding subsection 7.4(viii),Company shall not be
directly or indirectly liable with respect to such Acquisition
Indebtedness;
(b) such Acquisition Indebtedness shall either be unsecured or
secured solely by Liens on assets or capital stock of the applicable
Acquired Business, which Liens were incurred on or before the date
of the Permitted Acquisition;
(c) the terms of such Acquisition Indebtedness shall not
restrict the ability of any Subsidiary of the Company to (x) pay
dividends or make any other distributions on or in respect of its
capital stock; (y) make loans or advances or to pay any Indebtedness
or other obligation owed to Company or any other Subsidiary of the
Company; or (z) transfer any of its property or assets to the
Company or any other Subsidiary of the Company, except for customary
restrictions on the ability of a Subsidiary of the Company to
dividend, distribute or otherwise transfer any asset which secures
Acquisition Indebtedness of such Subsidiary; and
(d) the other terms and conditions of such Acquisition
Indebtedness are reasonably satisfactory to Requisite Lenders; and
(vii) Company and its Subsidiaries may become and remain liable with
respect to other Indebtedness in an aggregate principal amount not to
exceed $3,000,000 at any time outstanding.
7.2 LIENS AND RELATED MATTERS
A. PROHIBITION ON LIENS. Company shall not, and shall not permit any of
its Subsidiaries to, directly or indirectly, create, incur, assume or permit to
exist any Lien on or with respect to any property or asset of any kind
(including any document or instrument in respect of
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goods or accounts receivable) of Company or any of its Subsidiaries, whether now
owned or hereafter acquired, or any income or profits therefrom, or file or
permit the filing of, or permit to remain in effect, any financing statement or
other similar notice of any Lien with respect to any such property, asset,
income or profits under the Uniform Commercial Code of any State or under any
similar recording or notice statute, except:
(i) Permitted Encumbrances;
(ii) Liens granted pursuant to the Collateral Documents;
(iii) Liens described in SCHEDULE 7.2 annexed hereto; and
(iv) Liens on property of Company's Subsidiaries acquired in
Permitted Acquisitions securing Acquisition
Indebtedness permitted under subsection 7.1(vi),
PROVIDED that each such Lien is limited to such
property so acquired; and
(v) Other Liens securing Indebtedness in an aggregate
amount not to exceed $3,000,000 at any time
outstanding.
Nothing in this subsection 7.2 shall prohibit the sale, assignment,
transfer, conveyance or other disposition of any Margin Stock owned by Company
or any of its Subsidiaries at its fair value (as determined in good faith by its
Board of Directors) so long as proceeds are held as Cash or Cash Equivalents, or
the creation, incurrence, assumption or existence of any Lien on or with respect
to any Margin Stock.
B. EQUITABLE LIEN IN FAVOR OF LENDERS. If Company or any of its
Subsidiaries shall create or assume any Lien upon any of its properties or
assets, whether now owned or hereafter acquired, other than Liens excepted by
the provisions of subsection 7.2A, it shall make or cause to be made effective
provision whereby the Obligations will be secured by such Lien equally and
ratably with any and all other Indebtedness secured thereby as long as any such
Indebtedness shall be so secured; provided that, notwithstanding the foregoing,
this covenant shall not be construed as a consent by Requisite Lenders to the
creation or assumption of any such Lien not permitted by the provisions of
subsection 7.2A; and PROVIDED further, that this covenant shall not require
Company to cause any Foreign Subsidiary to grant to Lenders a Lien on the assets
or properties of such Foreign Subsidiary to the extent that grant of such Lien
would constitute an investment of earnings in United States property under
Section 956 (or a successor provision) of the Internal Revenue Code that would,
if such Foreign Subsidiary has any income, trigger an increase in the gross
income of a United States shareholder of such Foreign Subsidiary pursuant to
Section 951 (or a successor provision) of the Internal Revenue Code.
C. NO FURTHER NEGATIVE PLEDGES. Except with respect to specific
property encumbered to secure payment of particular Indebtedness or to be sold
pursuant to an executed agreement with respect to an Asset Sale, neither Company
nor any of its Subsidiaries shall enter into any agreement prohibiting the
creation or assumption of any Lien upon any of its properties or assets, whether
now owned or hereafter acquired.
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D. NO RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS TO COMPANY OR OTHER
SUBSIDIARIES. Except as provided herein, Company will not, and will not permit
any of its Subsidiaries to, create or otherwise cause or suffer to exist or
become effective any consensual encumbrance or restriction of any kind on the
ability of any such Subsidiary to (i) pay dividends or make any other
distributions on any of such Subsidiary's capital stock owned by Company or any
other Subsidiary of Company, (ii) repay or prepay any Indebtedness owed by such
Subsidiary to Company or any other Subsidiary of Company, (iii) make loans or
advances to Company or any other Subsidiary of Company, or (iv) transfer any of
its property or assets to Company or any other Subsidiary of Company.
7.3 INVESTMENTS; JOINT VENTURES
Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, make or own any Investment in any Person, including any
Joint Venture, except:
(i) Company and its Subsidiaries may make and own Investments in
Cash Equivalents;
(ii) Company and its Subsidiaries may continue to own the
Investments owned by them as of the Closing Date in any Subsidiaries of
Company;
(iii) Company and its Subsidiaries may make intercompany loans to
the extent permitted under subsection 7.1(iv);
(iv) Company and its Subsidiaries may make Consolidated Capital
Expenditures permitted by subsection 7.8;
(v) Company and its Subsidiaries may continue to own the Investments
owned by them and described in SCHEDULE 7.3 annexed hereto;
(vi) Company and its Subsidiaries may make and own Investments in
Joint Ventures formed with Persons organized outside of the United
States for the purpose of operating trade shows in an aggregate amount
not to exceed at any time $10,000,000;
(vii) Company and its Subsidiaries may make Investments in Permitted
Acquisitions permitted under subsection 7.7(vi); and
(viii) Company and its Subsidiaries may make and own other
Investments in an aggregate amount not to exceed at any time
$3,000,000.
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7.4 CONTINGENT OBLIGATIONS
Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create or become or remain liable with respect to any
Contingent Obligation, except:
(i) Subsidiaries of Company may become and remain liable with
respect to Contingent Obligations in respect of the Subsidiary
Guaranty;
(ii) Company may become and remain liable with respect to Contingent
Obligations in respect of the Letters of Credit;
(iii) Company may become and remain liable with respect to
Contingent Obligations under Hedge Agreements required under subsection
6.10;
(iv) Company and its Subsidiaries may become and remain liable with
respect to Contingent Obligations in respect of customary
indemnification and purchase price adjustment obligations incurred in
connection with Asset Sales or other sales of assets;
(v) Company and its Subsidiaries may become and remain liable with
respect to Contingent Obligations under guarantees in the ordinary
course of business of the obligations of suppliers, customers,
franchisees and licensees of Company and its Subsidiaries in an
aggregate amount not to exceed at any time $1,000,000;
(vi) Company may become and remain liable with respect to Contingent
Obligations under guarantees of Indebtedness of internet.com, LLC, in
an amount not to exceed at any time $1,800,000;
(vii) Company and its Subsidiaries, as applicable, may remain liable
with respect to Contingent Obligations described in SCHEDULE 7.4
annexed hereto;
(viii) Company and its Subsidiaries may become and remain liable
with respect to Contingent Obligations in respect of any Indebtedness
of Company or any of its Domestic Subsidiaries permitted by subsection
7.1;
(ix) Company and its Subsidiaries may become and remain liable with
respect to other Contingent Obligations; PROVIDED that the maximum
aggregate liability, contingent or otherwise, of Company and its
Subsidiaries in respect of all such Contingent Obligations shall at no
time exceed $3,000,000.
7.5 RESTRICTED JUNIOR PAYMENTS
Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, declare, order, pay, make or set apart
any sum for any Restricted Junior Payment; PROVIDED that if no Default or Event
of Default shall have occurred and be continuing, or would result after giving
effect to such distribution on a pro forma basis, Company may declare and pay
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dividends in respect of shares of its common stock in an aggregate amount not to
exceed $2,700,000 in each calendar year.
7.6 FINANCIAL COVENANTS
A. MINIMUM INTEREST COVERAGE RATIO. Company shall not permit the
Consolidated Interest Coverage Ratio at any time during each period commencing
on each date set forth below to but excluding, the last day of the Fiscal
Quarter commencing after such date, to be less than the correlative ratio
indicated:
<TABLE>
<CAPTION>
MINIMUM INTEREST
DATE COVERAGE RATIO
---------------- --------------
<S> <C>
March 31, 1999 2.3:1.00
June 30, 1999 2.5:1.00
September 30, 1999 2.5:1.00
December 31, 1999 2.7:1.00
March 31, 2000 2.7:1.00
June 30, 2000 2.8:1.00
September 30, 2000 2.9:1.00
December 31, 2000 3.0:1.00
each Fiscal Quarter
ending thereafter 3.0:1.00
</TABLE>
B. MINIMUM FIXED CHARGE COVERAGE RATIO. Company shall not permit the
Consolidated Fixed Charge Coverage Ratio at any time to be less than 1.025:1.00.
C. MAXIMUM CONSOLIDATED LEVERAGE RATIO. Company shall not permit the
Consolidated Leverage Ratio at any time during each period commencing on each
date set forth below to but excluding the last day of the Fiscal Quarter
commencing after such date, to exceed the correlative ratio indicated:
<TABLE>
<CAPTION>
MAXIMUM CONSOLIDATED
DATE LEVERAGE RATIO
---- --------------
<S> <C>
December 31, 1998 4.9:1.00
March 31, 1999 4.9:1.00
June 30, 1999 4.7:1.00
September 30, 1999 4.6:1.00
December 31, 1999 4.3:1.00
</TABLE>
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<TABLE>
<S> <C>
March 31, 2000 4.2:1.00
June 30, 2000 4.1:1.00
September 30, 2000 3.9:1.00
December 31, 2000 3.8:1.00
March 31, 2001 3.7:1.00
June 30, 2001 3.5:1.00
September 30, 2001 3.2:1.00
December 31, 2001 3.2:1.00
March 31, 2002 3.0:1.00
June 30, 2002 3.0:1.00
September 30, 2002 3.0:1.00
December 31, 2002 3.0:1.00
the last day of
each Fiscal Quarter
ending thereafter 3.0:1.00
</TABLE>
D. MINIMUM CONSOLIDATED EBITDA. Company shall not at any time permit
Consolidated EBITDA for any four Fiscal Quarter period ending on any date set
forth below to be less than the correlative amount indicated:
<TABLE>
MINIMUM CONSOLIDATED
DATE EBITDA
------------------ ------------
<S> <C>
December 31, 1998 $60,000,000
March 31, 1999 $60,000,000
June 30, 1999 62,000,000
September 30, 1999 63,000,000
December 31, 1999 66,000,000
March 31, 2000 $66,000,000
June 30, 2000 69,000,000
September 30, 2000 69,000,000
December 31, 2000 73,000,000
March 31, 2001 $73,000,000
June 30, 2001 75,000,000
September 30, 2001 76,000,000
December 31, 2001 80,000,000
March 31, 2002 $83,000,000
</TABLE>
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<TABLE>
<S> <C>
June 30, 2002 83,000,000
September 30, 2002 83,000,000
December 31, 2002 83,000,000
March 31, 2003 $88,000,000
June 30, 2003 88,000,000
September 30, 2003 88,000,000
December 31, 2003 88,000,000
March 31, 2004 $93,000,000
June 30, 2004 93,000,000
September 30, 2004 93,000,000
December 31, 2004 93,000,000
March 31, 2005 $93,000,000
June 30, 2005 93,000,000
September 30, 2005 93,000,000
December 31, 2005 93,000,000
March 31, 2006 $93,000,000
</TABLE>
7.7. RESTRICTION ON FUNDAMENTAL CHANGES; ASSET SALES AND ACQUISITIONS
Company shall not, and shall not permit any of its Subsidiaries to,
alter the corporate, capital or legal structure of Company or any of its
Subsidiaries, or enter into any transaction of merger or consolidation, or
liquidate, wind-up or dissolve itself (or suffer any liquidation or
dissolution), or convey, sell, lease or sub-lease (as lessor or sublessor),
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business, property or assets, whether now
owned or hereafter acquired, or acquire by purchase or otherwise all or
substantially all the business, property or fixed assets of, or stock or other
evidence of beneficial ownership of, any Person or any division or line of
business of any Person, except:
(i) any Subsidiary of Company may be merged with or into Company or
any wholly-owned Subsidiary Guarantor, or be liquidated, wound up or
dissolved, or all or any part of its business, property or assets may
be conveyed, sold, leased, transferred or otherwise disposed of, in one
transaction or a series of transactions, to Company or any wholly-owned
Subsidiary Guarantor; provided that, in the case of such a merger,
Company or such wholly-owned Subsidiary Guarantor shall be the
continuing or surviving corporation;
(ii) Company and its Subsidiaries may make Consolidated Capital
Expenditures permitted under subsection 7.8;
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(iii) Company and its Subsidiaries may dispose of obsolete, worn out
or surplus property in the ordinary course of business;
(iv) Company and its Subsidiaries may sell or otherwise dispose of
assets in transactions that do not constitute Asset Sales; provided
that the consideration received for such assets shall be in an amount
at least equal to the fair market value thereof;
(v) Merger Sub and Target may consummate the Merger in accordance
with the terms of the Merger Agreement;
(vi) Company and its Subsidiaries may acquire, whether by purchase,
issuance of stock or other equity or debt securities, merger,
reorganization or any other method, any Person, substantially all of
the assets of any Person, or any division or line of business of any
Person (any such Person, assets, division or line of business being an
"ACQUIRED BUSINESS" and any such acquisition permitted hereunder being
a "PERMITTED ACQUISITION"), PROVIDED that each of the following
conditions is satisfied:
(a) the Acquired Business is engaged in a line of business that
Company and its Subsidiaries are permitted to engage in under
subsection 7.14;
(b) the Acquired Business becomes a wholly-owned Domestic
Subsidiary of Company or is acquired by a wholly-owned Domestic
Subsidiary of Company in such Permitted Acquisition;
(c) the aggregate amount of consideration consisting of Cash
paid by Company and its Subsidiaries and the principal amount of
Acquisition Indebtedness incurred or assumed by Company and its
Subsidiaries for all Permitted Acquisitions made after the Closing
Date shall not exceed $15,000,000; and the aggregate amount of all
consideration paid by Company and its Subsidiaries for all Permitted
Acquisitions (including the fair market value of all non-Cash
consideration) made after the Closing Date shall not exceed
$35,000,000;
(d) the excess of the Revolving Loan Commitments over the Total
Utilization of Revolving Loan Commitments immediately after giving
effect to such Permitted Acquisition will be not less than
$10,000,000;
(e) concurrently with the consummation of such Permitted
Acquisition, Company shall, and shall cause its Subsidiaries to,
comply with the requirements of subsections 6.8 and 6.9 with respect
to such Permitted Acquisition; and
(f) prior to the consummation of any such Permitted Acquisition
having a purchase price in excess of $5,000,000, Company shall
deliver to Administrative Agent an Officers' Certificate (1)
certifying that no Potential Event of Default or Event of Default
under this Agreement shall then exist or shall occur as a result of
such Permitted Acquisition, (2) demonstrating that after giving
effect
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to such Permitted Acquisition and to all Indebtedness to be incurred
or assumed or repaid in connection with or as consideration for such
Permitted Acquisition, Company will be in Pro Forma Financial
Covenant Compliance as of the last day of the four Fiscal Quarter
period most recently ended prior to the date of the proposed
Permitted Acquisition for which the relevant financial information
is available, (3) delivering a copy, prepared in conformity with
GAAP (subject to year-end adjustments and the absence of footnotes),
of (i) financial statements of the Person or business so acquired
for the immediately preceding four consecutive Fiscal Quarter period
corresponding to the calculation period for the financial covenants
in the immediately preceding clause and (ii) audited or reviewed
financial statements of the Person or business so acquired for the
fiscal year ended within such period of such Person, and (4) revised
financial projections (in a form substantially consistent with
previously provided projections) for Company pro forma for any
proposed Permitted Acquisition in excess of $5,000,000 for the
succeeding four Fiscal Quarters;
(vii) subject to subsection 7.13, Company and its Subsidiaries may
make Asset Sales in each Fiscal Year of assets having a fair market
value not in excess of $1,000,000 in such Fiscal Year; provided that
(x) the consideration received for such assets shall be in an amount at
least equal to the fair market value thereof; (y) the sole
consideration received shall be cash; and (z) the proceeds of such
Asset Sales shall be applied as required by subsection 2.4B(iii)(a);
(viii) Company and its Subsidiaries may make Asset Sales in each
year consisting of magazine titles and the assets associated therewith;
PROVIDED that (x) the consideration received in exchange for such
magazine titles and associated assets consists solely of one or more
other magazine titles and associated assets, (y) the total revenue
attributable to any such magazine title proposed to be sold does not
exceed $500,000 for the 12 month period preceding the date of sale, and
(z) no more than three magazine titles may be sold in any Fiscal Year
pursuant to this clause (viii);
(ix) Company and its Subsidiaries may sell the capital stock or
assets of Curtin & Pease/Peneco, the Penton Press division of Company,
and/or the Feather Fine division of Curtin & Pease/Peneco Inc.;
PROVIDED that (x) the consideration received for such assets shall be
in an amount at least equal to the fair market value thereof; (y) not
less than 90% of the consideration therefor shall be cash; and (z) the
proceeds of such Asset Sales shall be applied as required by subsection
2.4B(iii)(a).
Nothing in this subsection 7.7 shall prohibit the sale, assignment,
transfer, conveyance or other disposition of any Margin Stock owned by Company
or any of its Subsidiaries at its fair value (as determined in good faith by its
Board of Directors) so long as proceeds are held as Cash or Cash Equivalents.
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7.8 CONSOLIDATED CAPITAL EXPENDITURES
Company shall not, and shall not permit its Subsidiaries to, make or
incur Consolidated Capital Expenditures, in any Fiscal Year indicated below, in
an aggregate amount in excess of the corresponding amount (the "MAXIMUM
CONSOLIDATED CAPITAL EXPENDITURES AMOUNT") set forth below opposite such Fiscal
Year; PROVIDED that the Maximum Consolidated Capital Expenditures Amount for any
Fiscal Year shall be increased by an amount equal to the excess, if any, of the
Maximum Consolidated Capital Expenditures Amount for the previous Fiscal Year
(but in no event more than 50% of the Maximum Consolidated Expenditures Amount
for the previous Fiscal Year (as adjusted in accordance with this proviso)) over
the actual amount of Consolidated Capital Expenditures for such previous Fiscal
Year:
<TABLE>
<CAPTION>
FISCAL YEAR MAXIMUM CONSOLIDATED
----------------- CAPITAL EXPENDITURES
--------------------
<S> <C>
1999
$11,000,000
2000 $12,000,000
2001 $14,000,000
2002 $14,000,000
2003 $14,000,000
2005 $14,000,000
</TABLE>
7.9 [intentionally omitted]
7.10 SALES AND LEASE-BACKS
Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, become or remain liable as lessee or as a guarantor or
other surety with respect to any lease, whether an Operating Lease or a Capital
Lease, of any property (whether real, personal or mixed), whether now owned or
hereafter acquired, (i) which Company or any of its Subsidiaries has sold or
transferred or is to sell or transfer to any other Person (other than Company or
any of its Subsidiaries) or (ii) which Company or any of its Subsidiaries
intends to use for substantially the same purpose as any other property which
has been or is to be sold or transferred by Company or any of its Subsidiaries
to any Person (other than Company or any of its Subsidiaries) in connection with
such lease.
7.11 SALE OR DISCOUNT OF RECEIVABLES
Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, sell with recourse, or discount or otherwise sell for
less than the face value thereof, any of its notes or accounts receivable.
7.12 TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES
Company shall not, and shall not permit any of its
Subsidiaries to, directly or
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indirectly, enter into or permit to exist any transaction (including, without
limitation, the purchase, sale, lease or exchange of any property or the
rendering of any service) with any holder of 5% or more of any class of equity
Securities of Company or with any Affiliate of Company or of any such holder, on
terms that are less favorable to Company or that Subsidiary, as the case may be,
than those that might be obtained at the time from Persons who are not such a
holder or Affiliate; PROVIDED that the foregoing restriction shall not apply to
(i) any transaction between Company and any of its wholly-owned Subsidiaries or
between any of its wholly-owned Subsidiaries or (ii) reasonable and customary
fees paid to members of the Boards of Directors of Company and its Subsidiaries.
7.13 DISPOSAL OF SUBSIDIARY STOCK
Except for any sale of 100% of the capital stock or other
equity Securities of any of its Subsidiaries in compliance with the provisions
of subsection 7.7, Company shall not:
(i) directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any shares of capital stock or other equity
Securities of any of its Subsidiaries, except to qualify directors if
required by applicable law; or
(ii) permit any of its Subsidiaries directly or indirectly to sell,
assign, pledge or otherwise encumber or dispose of any shares of
capital stock or other equity Securities of any of its Subsidiaries
(including such Subsidiary), except to Company, another Subsidiary of
Company, or to qualify directors if required by applicable law.
Nothing in this subsection 7.13 shall prohibit the sale,
assignment, transfer, conveyance or other disposition of any Margin Stock owned
by Company or any of its Subsidiaries at its fair value (as determined in good
faith by its Board of Directors) so long as proceeds are held as Cash or Cash
Equivalents or the creation, incurrence, assumption or existence of any Lien on
or with respect to any Margin Stock, provided, however, that Company shall not,
and shall not permit any of its Subsidiaries to, take any action which will have
the effect of causing any shares of the capital stock (other than Tendered
Target Shares) of any Subsidiary of Company to constitute Margin Stock.
7.14 CONDUCT OF BUSINESS
A. From and after the Closing Date, Company shall not, and shall not
permit any of its Subsidiaries to, engage in any business other than (i) the
businesses engaged in by Company and its Subsidiaries on the Closing Date and
similar or related businesses and (ii) such other lines of business as may be
consented to by Requisite Lenders.
B. Company will not permit Merger Sub to engage in any activities other
than those that are necessary or advisable to effect the Tender Offer upon the
terms set forth in the Tender Offer Materials, to consummate the Merger, and to
effect the transactions contemplated by this Agreement.
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7.15 AMENDMENTS OR WAIVERS OF CERTAIN RELATED AGREEMENTS
Neither Company nor any of its Subsidiaries will agree to any material
amendment to, or waive any of its material rights under, or agree to terminate,
any Related Agreement after the Closing Date without in each case obtaining the
prior written consent of Requisite Lenders to such amendment, waiver or
termination.
7.16 FISCAL YEAR
Company shall not change its Fiscal Year-end from December 31.
SECTION 8. EVENTS OF DEFAULT
If any of the following conditions or events ("Events of Default")
shall occur:
8.1 FAILURE TO MAKE PAYMENTS WHEN DUE
Failure by Company to pay any installment of principal of any Loan when
due, whether at stated maturity, by acceleration, by notice of voluntary
prepayment, by mandatory prepayment or otherwise; failure by Company to pay when
due any amount payable to an Issuing Lender in reimbursement of any drawing
under a Letter of Credit; or failure by Company to pay any interest on any Loan
or any fee or any other amount due under this Agreement within five days after
the date due; or
8.2 DEFAULT IN OTHER AGREEMENTS
(i) Failure of Company or any of its Subsidiaries to pay when due
any principal of or interest on or any other amount payable in respect
of one or more items of Indebtedness (other than Indebtedness referred
to in subsection 8.1) or Contingent Obligations in an individual
principal amount of $2,500,000 or more or with an aggregate principal
amount of $5,000,000 or more, in each case beyond the end of any grace
period provided therefor; or (ii) breach or default by Company or any
of its Subsidiaries with respect to any other material term of (a) one
or more items of Indebtedness or Contingent Obligations in the
individual or aggregate principal amounts referred to in clause (i)
above or (b) any loan agreement, mortgage, indenture or other agreement
relating to such item(s) of Indebtedness or Contingent Obligation(s),
if the effect of such breach or default is to cause, or to permit the
holder or holders of that Indebtedness or Contingent Obligation(s) (or
a trustee on behalf of such holder or holders) to cause, that
Indebtedness or Contingent Obligation(s) to become or be declared due
and payable prior to its stated maturity or the stated maturity of any
underlying obligation, as the case may be (upon the giving or receiving
of notice, lapse of time, both, or otherwise); or
8.3 BREACH OF CERTAIN COVENANTS
Failure of Company to perform or comply with any term or condition
contained in subsection 2.5 or 6.2 or Section 7 of this Agreement; or
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8.4 BREACH OF WARRANTY
Any representation, warranty, certification or other statement made
by Company or any of its Subsidiaries in any Loan Document or in any statement
or certificate at any time given by Company or any of its Subsidiaries in
writing pursuant hereto or thereto or in connection herewith or therewith shall
be false in any material respect on the date as of which made; or
8.5 OTHER DEFAULTS UNDER LOAN DOCUMENTS
Any Loan Party shall default in the performance of or compliance
with any term contained in this Agreement or any of the other Loan Documents,
other than any such term referred to in any other subsection of this Section 8,
and such default shall not have been remedied or waived within 15 days after the
earlier of (i) an officer of Company or such Loan Party becoming aware of such
default or (ii) receipt by Company and such Loan Party of notice from any Agent
or any Lender of such default; or
8.6 INVOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC
(i) A court having jurisdiction in the premises shall enter a
decree or order for relief in respect of Company or any of its
Subsidiaries in an involuntary case under the Bankruptcy Code or under
any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, which decree or order is not stayed; or any other
similar relief shall be granted under any applicable federal or state
law; or (ii) an involuntary case shall be commenced against Company or
any of its Subsidiaries under the Bankruptcy Code or under any other
applicable bankruptcy, insolvency or similar law now or hereafter in
effect; or a decree or order of a court having jurisdiction in the
premises for the appointment of a receiver, liquidator, sequestrator,
trustee, custodian or other officer having similar powers over Company
or any of its Subsidiaries, or over all or a substantial part of its
property, shall have been entered; or there shall have occurred the
involuntary appointment of an interim receiver, trustee or other
custodian of Company or any of its Subsidiaries for all or a
substantial part of its property; or a warrant of attachment, execution
or similar process shall have been issued against any substantial part
of the property of Company or any of its Subsidiaries, and any such
event described in this clause (ii) shall continue for 60 days unless
dismissed, bonded or discharged; or
8.7 VOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC
(i) Company or any of its Subsidiaries shall have an order for
relief entered with respect to it or commence a voluntary case under
the Bankruptcy Code or under any other applicable bankruptcy,
insolvency or similar law now or hereafter in effect, or shall consent
to the entry of an order for relief in an involuntary case, or to the
conversion of an involuntary case to a voluntary case, under any such
law, or shall consent to the appointment of or taking possession by a
receiver, trustee or other custodian for all or a substantial part of
its property; or Company or any of its Subsidiaries shall make any
assignment for the benefit of creditors; or (ii) Company or any of its
Subsidiaries shall be
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unable, or shall fail generally, or shall admit in writing its
inability, to pay its debts as such debts become due; or the Board of
Directors of Company or any of its Subsidiaries (or any committee
thereof) shall adopt any resolution or otherwise authorize any action
to approve any of the actions referred to in clause (i) above or this
clause (ii); or
8.8 JUDGMENTS AND ATTACHMENTS
Any money judgment, writ or warrant of attachment or similar process
involving (i) in any individual case an amount in excess of $1,000,000 or (ii)
in the aggregate at any time an amount in excess of $2,500,000 (in either case
not adequately covered by insurance as to which a solvent and unaffiliated
insurance company has acknowledged coverage) shall be entered or filed against
Company or any of its Subsidiaries or any of their respective assets and shall
remain undischarged, unvacated, unbonded or unstayed for a period of 60 days (or
in any event later than five days prior to the date of any proposed sale
thereunder); or
8.9 DISSOLUTION
Any order, judgment or decree shall be entered against Company or
any of its Subsidiaries decreeing the dissolution or split up of Company or that
Subsidiary and such order shall remain undischarged or unstayed for a period in
excess of 30 days; or
8.10 EMPLOYEE BENEFIT PLANS
There shall occur one or more ERISA Events which individually or in
the aggregate results in or might reasonably be expected to result in unpaid
liabilities of Company, any of its Subsidiaries or any of their respective ERISA
Affiliates in excess of $1,000,000 at any time; or there shall exist an amount
of unfunded benefit liabilities (as defined in Section 4001(a)(18) of ERISA),
individually or in the aggregate for all Pension Plans (excluding for purposes
of such computation any Pension Plans with respect to which assets exceed
benefit liabilities), which exceeds $5,000,000; or
8.11 CHANGE IN CONTROL
(i) Any Person or any two or more Persons acting in concert shall
have acquired beneficial ownership (within the meaning of Rule 13d-3 of
the Securities and Exchange Commission under the Exchange Act),
directly or indirectly, of Securities of Company (or other Securities
convertible into such Securities) representing 25% or more of the
combined voting power of all Securities of Company entitled to vote in
the election of directors, other than Securities having such power only
by reason of the happening of a contingency PROVIDED that the
beneficial ownership as of the date hereof by the Harris family of the
Securities of Company shall not constitute an Event of Default
hereunder, or
(ii) during any period of 12 consecutive months after the date
hereof, individuals who at the beginning of any such 12-month period
constituted the Board of Directors of Company (together with any new
directors whose election by such Board or whose nomination for election
by the shareholders of Company was approved by a vote of
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a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any
reason to constitute a majority of the Board of Directors of Company
then in office; or
8.12 INVALIDITY OF SUBSIDIARY GUARANTY; FAILURE OF SECURITY; REPUDIATION OF
OBLIGATIONS
At any time after the execution and delivery thereof, (i) the
Subsidiary Guaranty for any reason, other than the satisfaction in full of all
Obligations, shall cease to be in full force and effect (other than in
accordance with its terms) or shall be declared to be null and void, (ii) any
Collateral Document shall cease to be in full force and effect (other than by
reason of a release of Collateral thereunder in accordance with the terms hereof
or thereof, the satisfaction in full of the Obligations or any other termination
of such Collateral Document in accordance with the terms hereof or thereof) or
shall be declared null and void, or Administrative Agent shall not have or shall
cease to have a valid and perfected First Priority Lien in any Collateral
purported to be covered thereby, in each case for any reason other than the
failure of Administrative Agent or any Lender to take any action within its
control, or (iii) any Loan Party shall contest the validity or enforceability of
any Loan Document in writing or deny in writing that it has any further
liability, including without limitation with respect to future advances by
Lenders, under any Loan Document to which it is a party; or
8.13 FAILURE TO CONSUMMATE TENDER OFFER OR MERGER
The Tender Offer shall not be consummated in accordance with this
Agreement and the applicable Related Agreements concurrently with the making of
the initial Loans, or the consummation of the Tender Offer or the Merger shall
be unwound, reversed or otherwise rescinded in whole or in part for any reason:
THEN (i) upon the occurrence of any Event of Default described in subsection 8.6
or 8.7, each of (a) the unpaid principal amount of and accrued interest on the
Loans, (b) an amount equal to the maximum amount that may at any time be drawn
under all Letters of Credit then outstanding (whether or not any beneficiary
under any such Letter of Credit shall have presented, or shall be entitled at
such time to present, the drafts or other documents or certificates required to
draw under such Letter of Credit), and (c) all other Obligations shall
automatically become immediately due and payable, without presentment, demand,
protest or other requirements of any kind, all of which are hereby expressly
waived by Company, and the obligation of each Lender to make any Loan, the
obligation of Agent to issue any Letter of Credit and the right of any Lender to
issue any Letter of Credit hereunder shall thereupon terminate, and (ii) upon
the occurrence and during the continuation of any other Event of Default,
Administrative Agent shall, upon the written request or with the written consent
of Requisite Lenders, by written notice to Company, declare all or any portion
of the amounts described in clauses (a) through (c) above to be, and the same
shall forthwith become, immediately due and payable, and the obligation of each
Lender to make any Loan, the obligation of Administrative Agent to issue any
Letter of Credit and the right of any Lender to issue any Letter of Credit
hereunder shall thereupon terminate; PROVIDED that the
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foregoing shall not affect in any way the obligations of Revolving Loan Lenders
under subsection 3.3C(i) or the obligations of Revolving Loan Lenders to
purchase participations in any unpaid Swing Line Loans as provided in subsection
2.1A(iv).
Any amounts described in clause (b) above, when received by
Administrative Agent, shall be held by Administrative Agent and applied as
follows:
If for any reason the aggregate amount delivered by Company as
aforesaid is less than the amount described in clause (b) above (the
"AGGREGATE AVAILABLE AMOUNT"), the aggregate amount so delivered shall
be apportioned among all outstanding Letters of Credit in accordance
with the ratio of the maximum amount available for drawing under each
such Letter of Credit (as to such Letter of Credit, the "MAXIMUM
AVAILABLE AMOUNT") to the Aggregate Available Amount. Upon any drawing
under any outstanding Letters of Credit in respect of which Company has
delivered to Administrative Agent any amounts described above,
Administrative Agent shall apply such amounts to reimburse the Issuing
Lender for the amount of such drawing. In the event of cancellation or
expiration of any Letter of Credit in respect of which Company has
delivered any amounts described above, or in the event of any reduction
in the Maximum Available Amount under such Letter of Credit,
Administrative Agent shall apply the amount then on deposit with it in
respect of such Letter of Credit (LESS, in the case of such a
reduction, the Maximum Available Amount under such Letter of Credit
immediately after such reduction) first, to the extent of any excess,
to the cash collateralization of any outstanding Letters of Credit in
respect of which Company has failed to pay all or a portion of the
amounts described above (such cash collateralization to be apportioned
among all such Letters of Credit in the manner described above),
second, to the extent of any further excess, to the payment of any
other outstanding Obligations in such order as Administrative Agent
shall elect, and third, to the extent of any further excess, to the
payment to whomsoever shall be lawfully entitled to receive such funds.
Notwithstanding anything contained in the second preceding
paragraph, if at any time within 60 days after an acceleration of the Loans
pursuant to clause (ii) of such paragraph Company shall pay all arrears of
interest and all payments on account of principal which shall have become due
otherwise than as a result of such acceleration (with interest on principal and,
to the extent permitted by law, on overdue interest, at the rates specified in
this Agreement) and all Events of Default and Potential Events of Default (other
than non-payment of the principal of and accrued interest on the Loans, in each
case which is due and payable solely by virtue of acceleration) shall be
remedied or waived pursuant to subsection 10.6, then Requisite Lenders, by
written notice to Company, may at their option rescind and annul such
acceleration and its consequences; but such action shall not affect any
subsequent Event of Default or Potential Event of Default or impair any right
consequent thereon. The provisions of this paragraph are intended merely to bind
Lenders to a decision which may be made at the election of Requisite Lenders and
are not intended, directly or indirectly, to benefit Company, and such
provisions shall not at any time be construed so as to grant Company the right
to require Lenders to rescind or annul any acceleration hereunder or to preclude
Administrative Agent or Lenders from exercising any of the rights or remedies
available to them under any of the Loan Documents, even if the conditions set
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forth in this paragraph are met.
SECTION 9. THE AGENTS
9.1 APPOINTMENT.
A. APPOINTMENT OF AGENTS. First Union is hereby appointed
Administrative Agent hereunder and under the other Loan Documents and each
Lender hereby authorizes Administrative Agent to act as its agent in accordance
with the terms of this Agreement and the other Loan Documents. DLJ is hereby
appointed Syndication Agent hereunder and under the other Loan Documents and
each Lender hereby authorizes Syndication Agent to act as its agent in
accordance with the terms of this Agreement and the other Loan Documents. Each
of Syndication Agent and Administrative Agent agrees to act upon the express
conditions contained in this Agreement and the other Loan Documents, as
applicable. The provisions of this Section 9 are solely for the benefit of each
of Syndication Agent and Administrative Agent, and Lenders and Company shall
have no rights as a third party beneficiary of any of the provisions thereof. In
performing its functions and duties under this Agreement, each of Syndication
Agent and Administrative Agent shall act solely as an agent of Lenders and does
not assume and shall not be deemed to have assumed any obligation towards or
relationship of agency or trust with or for Company or any of its Subsidiaries.
B. APPOINTMENT OF SUPPLEMENTAL COLLATERAL AGENTS. It is the purpose of
this Agreement and the other Loan Documents that there shall be no violation of
any law of any jurisdiction denying or restricting the right of banking
corporations or associations to transact business as agent or trustee in such
jurisdiction. It is recognized that in case of litigation under this Agreement
or any of the other Loan Documents, and in particular in case of the enforcement
of any of the Loan Documents, or in case Administrative Agent deems that by
reason of any present or future law of any jurisdiction it may not exercise any
of the rights, powers or remedies granted herein or in any of the other Loan
Documents or take any other action which may be desirable or necessary in
connection therewith, it may be necessary that Administrative Agent appoint an
additional individual or institution as a separate trustee, co-trustee,
collateral agent or collateral co-agent (any such additional individual or
institution being referred to herein individually as a "SUPPLEMENTAL COLLATERAL
AGENT" and collectively as "SUPPLEMENTAL COLLATERAL AGENTS").
In the event that Administrative Agent appoints a Supplemental
Collateral Agent with respect to any Collateral, (i) each and every right,
power, privilege or duty expressed or intended by this Agreement or any of the
other Loan Documents to be exercised by or vested in or conveyed to
Administrative Agent with respect to such Collateral shall be exercisable by and
vest in such Supplemental Collateral Agent to the extent, and only to the
extent, necessary to enable such Supplemental Collateral Agent to exercise such
rights, powers and privileges with respect to such Collateral and to perform
such duties with respect to such Collateral, and every covenant and obligation
contained in the Loan Documents and necessary to the exercise or performance
thereof by such Supplemental Collateral Agent shall run to and be enforceable by
either Administrative Agent or such Supplemental Collateral Agent, and (ii) the
provisions of this
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Section 9 and of subsections 10.2 and 10.3 that refer to Administrative Agent
shall inure to the benefit of such Supplemental Collateral Agent and all
references therein to Administrative Agent shall be deemed to be references to
Administrative Agent and/or such Supplemental Collateral Agent, as the context
may require.
Should any instrument in writing from Company or any other Loan Party
be required by any Supplemental Collateral Agent so appointed by Administrative
Agent for more fully and certainly vesting in and confirming to him or it such
rights, powers, privileges and duties, Company shall, or shall cause such Loan
Party to, execute, acknowledge and deliver any and all such instruments promptly
upon request by Administrative Agent. In case any Supplemental Collateral Agent,
or a successor thereto, shall die, become incapable of acting, resign or be
removed, all the rights, powers, privileges and duties of such Supplemental
Collateral Agent, to the extent permitted by law, shall vest in and be exercised
by Administrative Agent until the appointment of a new Supplemental Collateral
Agent.
9.2 POWERS AND DUTIES; GENERAL IMMUNITY.
A. POWERS; DUTIES SPECIFIED. Each Lender irrevocably authorizes each
Agent to take such action on such Lender's behalf and to exercise such powers,
rights and remedies hereunder and under the other Loan Documents as are
specifically delegated or granted to such Agent by the terms hereof and thereof,
together with such powers, rights and remedies as are reasonably incidental
thereto. Each Agent shall have only those duties and responsibilities that are
expressly specified in this Agreement and the other Loan Documents. Each Agent
may exercise such powers, rights and remedies and perform such duties by or
through its agents or employees. No Agent shall have, by reason of this
Agreement or any of the other Loan Documents, a fiduciary relationship in
respect of any Lender; and nothing in this Agreement or any of the other Loan
Documents, expressed or implied, is intended to or shall be so construed as to
impose upon any Agent any obligations in respect of this Agreement or any of the
other Loan Documents except as expressly set forth herein or therein.
B. NO RESPONSIBILITY FOR CERTAIN MATTERS. No Agent shall be responsible
to any Lender for the execution, effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Agreement or any other
Loan Document or for any representations, warranties, recitals or statements
made herein or therein or made in any written or oral statements or in any
financial or other statements, instruments, reports or certificates or any other
documents furnished or made by such Agent to Lenders or by or on behalf of
Company to such Agent or any Lender in connection with the Loan Documents and
the transactions contemplated thereby or for the financial condition or business
affairs of Company or any other Person liable for the payment of any
Obligations, nor shall such Agent be required to ascertain or inquire as to the
performance or observance of any of the terms, conditions, provisions, covenants
or agreements contained in any of the Loan Documents or as to the use of the
proceeds of the Loans or the use of the Letters of Credit or as to the existence
or possible existence of any Event of Default or Potential Event of Default.
Anything contained in this Agreement to the contrary notwithstanding,
Administrative
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Agent shall not have any liability arising from confirmations of the amount of
outstanding Loans or the Letter of Credit Usage or the component amounts
thereof.
C. EXCULPATORY PROVISIONS. Neither of the Agents nor any of their
respective officers, directors, employees or agents shall be liable to Lenders
for any action taken or omitted by any such Agent under or in connection with
any of the Loan Documents except to the extent caused by such Agent's gross
negligence or willful misconduct. Each Agent shall be entitled to refrain from
any act or the taking of any action (including the failure to take an action) in
connection with this Agreement or any of the other Loan Documents or from the
exercise of any power, discretion or authority vested in it hereunder or
thereunder unless and until such Agent shall have received instructions in
respect thereof from Requisite Lenders (or such other Lenders as may be required
to give such instructions under subsection 10.6) and, upon receipt of such
instructions from Requisite Lenders (or such other Lenders, as the case may be),
such Agent shall be entitled to act or (where so instructed) refrain from
acting, or to exercise such power, discretion or authority, in accordance with
such instructions. Without prejudice to the generality of the foregoing, (i)
each Agent shall be entitled to rely, and shall be fully protected in relying,
upon any communication, instrument or document believed by it to be genuine and
correct and to have been signed or sent by the proper person or persons, and
shall be entitled to rely and shall be protected in relying on opinions and
judgments of attorneys (who may be attorneys for Company and its Subsidiaries),
accountants, experts and other professional advisors selected by it; and (ii) no
Lender shall have any right of action whatsoever against any Agent as a result
of such Agent acting or (where so instructed) refraining from acting under this
Agreement or any of the other Loan Documents in accordance with the instructions
of Requisite Lenders (or such other Lenders as may be required to give such
instructions under subsection 10.6).
D. AGENTS ENTITLED TO ACT AS LENDER. The agency hereby created shall in
no way impair or affect any of the rights and powers of, or impose any duties or
obligations upon, any Agent in its individual capacity as a Lender hereunder.
With respect to its participation in the Loans and the Letters of Credit, each
Agent shall have the same rights and powers hereunder as any other Lender and
may exercise the same as though it were not performing the duties and functions
delegated to it hereunder, and the term "Lender" or "Lenders" or any similar
term shall, unless the context clearly otherwise indicates, include such Agent
in its individual capacity. Any Agent and its Affiliates may accept deposits
from, lend money to and generally engage in any kind of banking, trust,
financial advisory or other business with Company or any of its Affiliates as if
it were not performing the duties specified herein, and may accept fees and
other consideration from Company for services in connection with this Agreement
and otherwise without having to account for the same to Lenders.
E. COMMENCEMENT OF ACTIONS. Notwithstanding anything to the contrary in
subsection 10.17 hereof or in any Loan Document, Administrative Agent will not
commence judicial proceedings against any Loan Party in any court other than a
state or federal court in the State, County and City of New York without the
consent of Syndication Agent.
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9.3 REPRESENTATIONS AND WARRANTIES; NO RESPONSIBILITY FOR APPRAISAL OF
CREDITWORTHINESS.
Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of Company and
its Subsidiaries in connection with the making of the Loans and the issuance of
Letters of Credit hereunder and that it has made and shall continue to make its
own appraisal of the creditworthiness of Company and its Subsidiaries. No Agent
shall have any duty or responsibility, either initially or on a continuing
basis, to make any such investigation or any such appraisal on behalf of Lenders
or to provide any Lender with any credit or other information with respect
thereto, whether coming into its possession before the making of the Loans or at
any time or times thereafter, and no Agent shall have any responsibility with
respect to the accuracy of or the completeness of any information provided to
Lenders.
9.4 RIGHT TO INDEMNITY.
Each Lender, in proportion to its Pro Rata Share, severally agrees
to indemnify each Agent, to the extent that such Agent shall not have been
reimbursed by Company, for and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses
(including counsel fees and disbursements) or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted against such
Agent in exercising its powers, rights and remedies or performing its duties
hereunder or under the other Loan Documents or otherwise in its capacity as
Administrative Agent or Syndication Agent, as the case may be, in any way
relating to or arising out of this Agreement or the other Loan Documents;
PROVIDED that no Lender shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from any Agent's gross negligence or willful
misconduct. If any indemnity furnished to any Agent for any purpose shall, in
the opinion of such Agent, be insufficient or become impaired, such Agent may
call for additional indemnity (but not in an amount that would require any
Lender to indemnify such Agent for an amount in excess of such Lender's Pro Rata
Share of the indemnification obligations owed to such Agent under this
subsection 9.4) and cease, or not commence, to do the acts indemnified against
until such additional indemnity is furnished.
95. SUCCESSOR AGENTS AND SWING LINE LENDER.
A. SUCCESSOR AGENTS. The Syndication Agent may resign at any time
upon one Business Days' prior notice thereof to Company and Administrative
Agent. Administrative Agent may resign at any time by giving 30 days' prior
written notice thereof to Syndication Agent, Lenders and Company, and
Administrative Agent may be removed at any time with or without cause by an
instrument or concurrent instruments in writing delivered to Company and
Administrative Agent and signed by Requisite Lenders. Upon any such notice of
resignation of Syndication Agent or Administrative Agent or any such removal of
Administrative Agent, Requisite Lenders shall have the right, upon five Business
Days' notice to Company, to appoint a successor Syndication Agent or
Administrative Agent, as the case may be. If for any reason Requisite Lenders
cannot agree on a successor Administrative Agent or a successor Syndication
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Agent, the resigning Administrative Agent or Syndication Agent shall have the
right to designate a successor Administrative Agent or Syndication Agent,
respectively, after consulting with Company. Upon the acceptance of any
appointment as Administrative Agent or Syndication Agent, as the case may be,
hereunder by a successor Administrative Agent or Syndication Agent, as the case
may be, that successor Administrative Agent or Syndication Agent, as the case
may be, shall thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring or removed Administrative Agent or
Syndication Agent, as the case may be, and the retiring or removed
Administrative Agent or Syndication Agent, as the case may be, shall be
discharged from its duties and obligations under this Agreement. After any
retiring or removed Administrative Agent's or Syndication Agent's resignation or
removal hereunder as Administrative Agent or Syndication Agent, as the case may
be, 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 or
Syndication Agent, as the case may be, under this Agreement.
B. SUCCESSOR SWING LINE LENDER. Any resignation or removal of
Administrative Agent pursuant to subsection 9.5A shall also constitute the
resignation or removal of First Union or its successor as Swing Line Lender, and
any successor Administrative Agent appointed pursuant to subsection 9.5A shall,
upon its acceptance of such appointment, become the successor Swing Line Lender
for all purposes hereunder. In such event (i) Company shall prepay any
outstanding Swing Line Loans made by the retiring or removed Administrative
Agent in its capacity as Swing Line Lender, (ii) upon such prepayment, the
retiring or removed Administrative Agent and Swing Line Lender shall surrender
the Swing Line Note held by it to Company for cancellation, and (iii) Company
shall issue a new Swing Line Note to the successor Administrative Agent and
Swing Line Lender substantially in the form of EXHIBIT VII annexed hereto, in
the principal amount of the Swing Line Loan Commitment then in effect and with
other appropriate insertions.
9.6 COLLATERAL DOCUMENTS AND SUBSIDIARY GUARANTY.
Each Lender hereby further authorizes Administrative Agent, on
behalf of and for the benefit of Lenders, to enter into each Collateral Document
as secured party and to be the agent for and representative of Lenders under the
Subsidiary Guaranty, and each Lender agrees to be bound by the terms of each
Collateral Document and the Subsidiary Guaranty; PROVIDED that Administrative
Agent shall not (i) enter into or consent to any material amendment,
modification, termination or waiver of any provision contained in any Collateral
Document or the Subsidiary Guaranty or (ii) release any Collateral (except as
otherwise expressly permitted or required pursuant to the terms of this
Agreement or the applicable Collateral Document), in each case without the prior
consent of Requisite Lenders (or, if required pursuant to subsection 10.6, all
Lenders); PROVIDED FURTHER, HOWEVER, that, without further written consent or
authorization from Lenders, Administrative Agent may execute any documents or
instruments necessary to (a) release any Lien encumbering any item of Collateral
that is the subject of a sale or other disposition of assets permitted by this
Agreement or to which Requisite
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Lenders have otherwise consented or (b) release any Subsidiary Guarantor from
the Subsidiary Guaranty if all of the equity Securities of such Subsidiary
Guarantor is sold to any Person (other than an Affiliate of Company) pursuant to
a sale or other disposition permitted hereunder or to which Requisite Lenders
have otherwise consented. Anything contained in any of the Loan Documents to the
contrary notwithstanding, Company, each Agent and each Lender hereby agree that
(X) no Lender shall have any right individually to realize upon any of the
Collateral under any Collateral Document or to enforce the Subsidiary Guaranty,
it being understood and agreed that all rights and remedies under the Collateral
Documents and the Subsidiary Guaranty may be exercised solely by Administrative
Agent for the benefit of Lenders in accordance with the terms thereof, and (Y)
in the event of a foreclosure by Administrative Agent on any of the Collateral
pursuant to a public or private sale, any Agent or any Lender may be the
purchaser of any or all of such Collateral at any such sale and Administrative
Agent, as agent for and representative of Lenders (but not any Lender or Lenders
in its or their respective individual capacities unless Requisite Lenders shall
otherwise agree in writing) shall be entitled, for the purpose of bidding and
making settlement or payment of the purchase price for all or any portion of the
Collateral sold at any such public sale, to use and apply any of the Obligations
as a credit on account of the purchase price for any collateral payable by
Administrative Agent at such sale.
9.7 CO-DOCUMENTATION AGENTS
The Co-Documentation Agents shall have no duties or obligations
under the Loan Documents in their capacity as Co-Documentation Agents.
9.8 ARRANGER
The Arranger shall have no duties or obligations under the Loan
Documents in its capacity as Arranger.
SECTION 10. MISCELLANEOUS
10.1 ASSIGNMENTS AND PARTICIPATIONS IN LOANS AND LETTERS OF CREDIT
A. GENERAL. Subject to subsection 10.1B, each Lender shall have the
right at any time to (i) sell, assign or transfer to any Eligible Assignee, or
(ii) sell participations to any Person in, all or any part of its Commitments or
any Loan or Loans made by it or its Letters of Credit or participations therein
or any other interest herein or in any other Obligations owed to it; PROVIDED
that no such sale, assignment, transfer or participation shall, without the
consent of Company, require Company to file a registration statement with the
Securities and Exchange Commission or apply to qualify such sale, assignment,
transfer or participation under the securities laws of any state; PROVIDED,
FURTHER that no such sale, assignment, transfer or participation of any Letter
of Credit or any participation therein may be made separately from a sale,
assignment, transfer or participation of a corresponding interest in the
Revolving Loan Commitment and the Revolving Loans of the Lender effecting such
sale, assignment, transfer or participation; and PROVIDED, FURTHER that,
anything contained herein to the contrary notwithstanding, the Swing Line Loan
Commitment and the Swing Line Loans of Swing Line Lender may not be sold,
assigned or transferred as described in clause (i) above to any Person other
than a successor Administrative Agent and Swing Line Lender to the extent
contemplated by subsection 9.5. Except as otherwise provided in this subsection
10.1, no Lender shall, as between Company and such Lender, be
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relieved of any of its obligations hereunder as a result of any sale, assignment
or transfer of, or any granting of participations in, all or any part of its
Commitments or the Loans, the Letters of Credit or participations therein, or
the other Obligations owed to such Lender.
B. ASSIGNMENTS.
(i) AMOUNTS AND TERMS OF ASSIGNMENTS. Each Commitment, Loan, Letter
of Credit or participation therein, or other Obligation may (a) be
assigned in any amount to another Lender, or to an Affiliate or
Affiliated Fund of the assigning Lender or another Lender, with the
giving of notice to Company and Administrative Agent or (b) be assigned
in an aggregate amount of not less than $3,000,000 (or such lesser
amount as shall constitute the aggregate amount of the Commitments,
Loans, Letters of Credit and participations therein, and other
Obligations of the assigning Lender) to any other Eligible Assignee
with the giving of notice to Company and with the consent of Company
and Agents (which consent of Company and Agents shall not be
unreasonably withheld or delayed); PROVIDED, that the consent of
Company shall not be required for assignments made during the
continuance of any Event of Default. To the extent of any such
assignment in accordance with either clause (a) or (b) above, the
assigning Lender shall be relieved of its obligations with respect to
its Commitments, Loans, Letters of Credit or participations therein, or
other Obligations or the portion thereof so assigned. The parties to
each such assignment shall execute and deliver to Administrative Agent,
for its acceptance, an Assignment Agreement, together with a processing
fee of $3,000 and such forms, certificates or other evidence, if any,
with respect to United States federal income tax withholding matters as
the assignee under such Assignment Agreement may be required to deliver
to Administrative Agent pursuant to subsection 2.7B(iii)(a). Upon such
execution, delivery and acceptance, from and after the effective date
specified in such Assignment Agreement, (y) the assignee thereunder
shall be a party hereto and, to the extent that rights and obligations
hereunder have been assigned to it pursuant to such Assignment
Agreement, shall have the rights and obligations of a Lender hereunder
and (z) the assigning Lender thereunder shall, to the extent that
rights and obligations hereunder have been assigned by it pursuant to
such Assignment Agreement, relinquish its rights (other than any rights
which survive the termination of this Agreement under subsection 10.9B)
and be released from its obligations under this Agreement (and, in the
case of an Assignment Agreement covering all or the remaining portion
of an assigning Lender's rights and obligations under this Agreement,
such Lender shall cease to be a party hereto; PROVIDED that, anything
contained in any of the Loan Documents to the contrary notwithstanding,
if such Lender is the Issuing Lender with respect to any outstanding
Letters of Credit such Lender shall continue to have all rights and
obligations of an Issuing Lender with respect to such Letters of Credit
until the cancellation or expiration of such Letters of Credit and the
reimbursement of any amounts drawn thereunder). The Commitments
hereunder shall be modified to reflect the Commitment of such assignee
and any remaining Commitment of such assigning Lender and, if any such
assignment occurs after the issuance of the Notes hereunder, the
assigning Lender shall, upon the effectiveness of such assignment or as
promptly thereafter as practicable, surrender its applicable Notes to
Administrative Agent for cancellation, and thereupon
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new Notes shall be issued to the assignee and to the assigning Lender,
substantially in the form of EXHIBIT IV, EXHIBIT V or EXHIBIT VI
annexed hereto, as the case may be, with appropriate insertions, to
reflect the new Commitments and/or outstanding Tranche A Term Loans
and/or Tranche B Term Loans and/or Revolving Loans, as the case may be,
of the assignee and the assigning Lender.
(ii) ACCEPTANCE BY ADMINISTRATIVE AGENT. Upon its receipt of an
Assignment Agreement executed by an assigning Lender and an assignee
representing that it is an Eligible Assignee, together with the
processing fee referred to in subsection 10.1B(i) (unless such fee is
waived by Administrative Agent) and any forms, certificates or other
evidence with respect to United States federal income tax withholding
matters that such assignee may be required to deliver to Administrative
Agent pursuant to subsection 2.7B(iii)(a), Administrative Agent shall,
if Agents and Company have consented to the assignment evidenced
thereby (in each case to the extent such consent is required pursuant
to subsection 10.1B(i)), (a) accept such Assignment Agreement by
executing a counterpart thereof as provided therein (which acceptance
shall evidence any required consent of Agent to such assignment) and
(b) give prompt notice thereof to Company. Agent shall maintain a copy
of each Assignment Agreement delivered to and accepted by it as
provided in this subsection 10.1B(ii).
C. PARTICIPATIONS. The holder of any participation, other than an
Affiliate of the Lender granting such participation, shall not be entitled to
require such Lender to take or omit to take any action hereunder except action
directly affecting (i) the extension of the scheduled final maturity date of any
Loan allocated to such participation or (ii) a reduction of the principal amount
of or the rate of interest payable on any Loan allocated to such participation,
and all amounts payable by Company hereunder (including without limitation
amounts payable to such Lender pursuant to subsections 2.6D, 2.7 and 3.6) shall
be determined as if such Lender had not sold such participation. Company and
each Lender hereby acknowledge and agree that, solely for purposes of
subsections 10.4 and 10.5, (a) any participation will give rise to a direct
obligation of Company to the participant and (b) the participant shall be
considered to be a "Lender"; PROVIDED that no participant shall be permitted to
exercise rights of set-off against obligations of Company owing to such
participant as a result of this sentence unless the Loans have become due and
payable by declaration, acceleration or maturity.
D. ASSIGNMENTS TO FEDERAL RESERVE BANKS. In addition to the assignments
and participations permitted under the foregoing provisions of this subsection
10.1, any Lender may assign and pledge all or any portion of its Loans, the
other Obligations owed to such Lender, and its Notes to any Federal Reserve Bank
as collateral security pursuant to Regulation A of the Board of Governors of the
Federal Reserve System and any operating circular issued by such Federal Reserve
Bank; PROVIDED that (i) no Lender shall, as between Company and such Lender, be
relieved of any of its obligations hereunder as a result of any such assignment
and pledge and (ii) in no event shall such Federal Reserve Bank be considered to
be a "Lender" or be entitled to require the assigning Lender to take or omit to
take any action hereunder.
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E. INFORMATION. Each Lender may furnish any information concerning
Company and its Subsidiaries in the possession of that Lender from time to time
to assignees and participants (including prospective assignees and
participants), subject to subsection 10.19.
F. REPRESENTATIONS OF LENDERS. Each Lender listed on the signature
pages hereof hereby represents and warrants (i) that it is an Eligible Assignee
described in clause (A) of the definition thereof; (ii) that it has experience
and expertise in the making of loans such as the Loans; and (iii) that it will
make its Loans for its own account in the ordinary course of its business and
without a view to distribution of such Loans within the meaning of the
Securities Act or the Exchange Act or other federal securities laws (it being
understood that, subject to the provisions of this subsection 10.1, the
disposition of such Loans or any interests therein shall at all times remain
within its exclusive control. Each Lender that becomes a party hereto pursuant
to an Assignment Agreement shall be deemed to agree that the representations and
warranties of such Lender contained in Section 2(c) of such Assignment Agreement
are incorporated herein by this reference.
10.2 EXPENSES
Whether or not the transactions contemplated hereby shall be
consummated, Company agrees to pay promptly (i) all the actual and reasonable
costs and expenses of preparation of the Loan Documents and any consents,
amendments, waivers or other modifications thereto, whether or not such
consents, amendments, waivers or other modifications shall become effective;
(ii) all the costs of furnishing all opinions by counsel for Company (including
without limitation any opinions requested by Agents or Lenders as to any legal
matters arising hereunder) and of Company's performance of and compliance with
all agreements and conditions on its part to be performed or complied with under
this Agreement and the other Loan Documents including, without limitation, with
respect to confirming compliance with environmental, insurance and solvency
requirements; (iii) the reasonable fees, expenses and disbursements of counsel
to Arranger, Syndication Agent and Administrative Agent (including allocated
costs of internal counsel) in connection with the negotiation, preparation,
execution and administration of the Loan Documents and any consents, amendments,
waivers or other modifications thereto and any other documents or matters
requested by Company, whether or not such consents, amendments, waivers or other
modifications shall become effective; (iv) all the actual costs and reasonable
expenses of creating and perfecting Liens in favor of Administrative Agent on
behalf of Lenders pursuant to any Collateral Document, including without
limitation filing and recording fees, expenses and taxes, stamp or documentary
taxes, search fees, title insurance premiums, and reasonable fees, expenses and
disbursements of counsel to each of Syndication Agent and Administrative Agent
and of counsel providing any opinions that Syndication Agent, Administrative
Agent or Requisite Lenders may request in respect of the Collateral Documents or
the Liens created pursuant thereto; (v) all the actual costs and reasonable
expenses (including without limitation the reasonable fees, expenses and
disbursements of any auditors, accountants or appraisers and any environmental
or other consultants, advisors and agents employed or retained by Syndication
Agent, Administrative Agent or their respective counsel) of obtaining and
reviewing any appraisals provided for under subsection 6.5B, any environmental
audits or reports provided for under subsection 6.7 or 6.9B(viii); (vi) the
custody
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or preservation of any of the Collateral; (vii) all other actual and reasonable
costs and expenses incurred by Arrangers and Agents in connection with the
syndication of the Commitments and the negotiation, preparation and execution of
the Loan Documents and any consents, amendments, waivers or other modifications
thereto and the transactions contemplated thereby; and (viii) after the
occurrence of an Event of Default, all costs and expenses, including reasonable
attorneys' fees (including allocated costs of internal counsel) and costs of
settlement, incurred by Agents and Lenders in enforcing any Obligations of or in
collecting any payments due from any Loan Party hereunder or under the other
Loan Documents by reason of such Event of Default (including, without
limitation, in connection with the sale of, collection from, or other
realization upon any of the Collateral or the enforcement of the Subsidiary
Guaranty) or in connection with any refinancing or restructuring of the credit
arrangements provided under this Agreement in the nature of a "work-out" or
pursuant to any insolvency or bankruptcy proceedings.
10.3 INDEMNITY
In addition to the payment of expenses pursuant to subsection 10.2,
whether or not the transactions contemplated hereby shall be consummated,
Company agrees to defend, indemnify, pay and hold harmless Arranger, Agents and
Lenders, and the officers, directors, trustees, employees, agents and affiliates
of Arranger, Agents and Lenders (collectively called the "Indemnitees"), from
and against any and all Indemnified Liabilities (as hereinafter defined);
PROVIDED that Company shall not have any obligation to any Indemnitee hereunder
with respect to any Indemnified Liabilities to the extent such Indemnified
Liabilities arise solely from the gross negligence or willful misconduct of that
Indemnitee as determined by a final judgment of a court of competent
jurisdiction.
As used herein, "INDEMNIFIED LIABILITIES" means, collectively, any
and all liabilities, obligations, losses, damages (including natural resource
damages), penalties, actions, judgments, suits, claims (including Environmental
Claims), costs (including the costs of any investigation, study, sampling,
testing, abatement, cleanup, removal, remediation or other response action
necessary to remove, remediate, clean up or abate any Hazardous Materials
Activity), expenses and disbursements of any kind or nature whatsoever
(including the reasonable fees and disbursements of counsel for Indemnitees in
connection with any investigative, administrative or judicial proceeding
commenced or threatened by any Person, whether or not any such Indemnitee shall
be designated as a party or a potential party thereto, and any fees or expenses
incurred by Indemnitees in enforcing this indemnity), whether direct, indirect
or consequential and whether based on any federal, state or foreign laws,
statutes, rules or regulations (including securities and commercial laws,
statutes, rules or regulations and Environmental Laws), on common law or
equitable cause or on contract or otherwise, that may be imposed on, incurred
by, or asserted against any such Indemnitee, in any manner relating to or
arising out of (i) this Agreement or the other Loan Documents or the Related
Agreements or the transactions contemplated hereby or thereby (including
Lenders' agreement to make the Loans hereunder or the use or intended use of the
proceeds thereof or the issuance of Letters of Credit hereunder or the use or
intended use of any thereof, or any enforcement of any of the Loan Documents
(including any sale of, collection from, or other realization upon any of the
Collateral or the enforcement of the Subsidiary Guaranty), (ii) the statements
contained in the commitment
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letter delivered by any Lender to Company with respect thereto, or (iii) any
Environmental Claim or any Hazardous Materials Activity relating to or arising
from, directly or indirectly, any past or present activity, operation, land
ownership, or practice of Company or any of its Subsidiaries.
To the extent that the undertakings to defend, indemnify, pay and
hold harmless set forth in this subsection 10.3 may be unenforceable in whole or
in part because they are violative of any law or public policy, Company shall
contribute the maximum portion that it is permitted to pay and satisfy under
applicable law to the payment and satisfaction of all Indemnified Liabilities
incurred by Indemnitees or any of them.
10.4 SET-OFF; SECURITY INTEREST IN DEPOSIT ACCOUNTS
In addition to any rights now or hereafter granted under applicable
law and not by way of limitation of any such rights, during the continuance of
any Event of Default each Lender is hereby authorized by Company at any time or
from time to time, without notice to Company or to any other Person, any such
notice being hereby expressly waived, to set off and to appropriate and to apply
any and all deposits (general or special, including, but not limited to,
Indebtedness evidenced by certificates of deposit, whether matured or unmatured,
but not including trust accounts) and any other Indebtedness at any time held or
owing by that Lender to or for the credit or the account of Company against and
on account of the obligations and liabilities of Company to that Lender under
this Agreement, the Letters of Credit and participations therein and the other
Loan Documents, including, but not limited to, all claims of any nature or
description arising out of or connected with this Agreement, the Letters of
Credit and participations therein or any other Loan Document, irrespective of
whether or not (i) that Lender shall have made any demand hereunder or (ii) the
principal of or the interest on the Loans or any amounts in respect of the
Letters of Credit or any other amounts due hereunder shall have become due and
payable pursuant to Section 8 and although said obligations and liabilities, or
any of them, may be contingent or unmatured. Company hereby further grants to
each Agent and each Lender a security interest in all deposits and accounts
maintained with such Agent or such Lender as security for the Obligations.
10.5 RATABLE SHARING
Lenders hereby agree among themselves that if any of them shall,
whether by voluntary payment (other than a voluntary prepayment of Loans made
and applied in accordance with the terms of this Agreement), by realization upon
security, through the exercise of any right of set-off or banker's lien, by
counterclaim or cross action or by the enforcement of any right under the Loan
Documents or otherwise, or as adequate protection of a deposit treated as cash
collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, amounts payable in
respect of Letters of Credit, fees and other amounts then due and owing to that
Lender hereunder or under the other Loan Documents (collectively, the "Aggregate
Amounts Due" to such Lender) which is greater than the proportion received by
any other Lender in respect of the Aggregate Amounts Due to such other Lender,
then the Lender receiving such proportionately greater payment shall (i) notify
Administrative Agent and each other Lender of the receipt of such payment and
(ii) apply a portion of such
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payment to purchase participations (which it shall be deemed to have purchased
from each seller of a participation simultaneously upon the receipt by such
seller of its portion of such payment) in the Aggregate Amounts Due to the other
Lenders so that all such recoveries of Aggregate Amounts Due shall be shared by
all Lenders in proportion to the Aggregate Amounts Due to them; PROVIDED that if
all or part of such proportionately greater payment received by such purchasing
Lender is thereafter recovered from such Lender upon the bankruptcy or
reorganization of Company or otherwise, those purchases shall be rescinded and
the purchase prices paid for such participations shall be returned to such
purchasing Lender ratably to the extent of such recovery, but without interest.
Company expressly consents to the foregoing arrangement and agrees that any
holder of a participation so purchased may exercise any and all rights of
banker's lien, set-off or counterclaim with respect to any and all monies owing
by Company to that holder with respect thereto as fully as if that holder were
owed the amount of the participation held by that holder.
10.6 AMENDMENTS AND WAIVERS
No amendment, modification, termination or waiver of any provision
of this Agreement or of the Notes, and no consent to any departure by Company
therefrom, shall in any event be effective without the written concurrence of
Requisite Lenders; PROVIDED that any such amendment, modification, termination,
waiver or consent which: increases the amount of any of the Commitments or
reduces the principal amount of any of the Loans; changes in any manner the
definitions of "Pro Rata Share", "Class", "Requisite Class Lenders" or
"Requisite Lenders"; changes in any manner any provision of this Agreement
which, by its terms, expressly requires the approval or concurrence of all
Lenders; postpones the scheduled final maturity date (but not the date of any
scheduled installment of principal) of any of the Loans; postpones the date on
which any interest or any fees are payable; decreases the interest rate borne by
any of the Loans (other than any waiver of any increase in the interest rate
applicable to any of the Loans pursuant to subsection 2.2E) or the amount of any
fees payable hereunder; increases the maximum duration of Interest Periods
permitted hereunder; reduces the amount or postpones the due date of any amount
payable in respect of, or extends the required expiration date of, any Letter of
Credit; changes in any manner the obligations of Lenders relating to the
purchase of participations in Letters of Credit; releases any Lien granted in
favor of Administrative Agent with respect to 25% or more in aggregate fair
market value of the Collateral; releases any Subsidiary Guarantor from its
obligations under the Subsidiary Guaranty, in each case other than in accordance
with the terms of the Loan Documents; or changes in any manner the provisions
contained in subsection 8.1 or this subsection 10.6 shall be effective only if
evidenced by a writing signed by or on behalf of all Lenders; PROVIDED, FURTHER,
that if any matter described in the foregoing proviso relates only to a
Revolving Loan or the Revolving Loan Commitments (including any extension of the
Revolving Loan Commitment Termination Date), the approval of all Revolving Loan
Lenders shall be sufficient; if any matter described in the foregoing proviso
relates only to a Tranche A Term Loan or the Tranche A Term Loan Commitments
(including any extension of the Tranche A Term Loan Commitment Termination
Date), the approval of all Tranche A Term Loan Lenders shall be sufficient; and
if any matter described in the foregoing proviso relates only to a Tranche B
Term Loan, the approval of all Tranche B Term Loan Lenders shall be sufficient.
In addition, (i) any amendment, modification, termination or waiver of any of
the provisions contained in
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Section 4 shall be effective only if evidenced by a writing signed by or on
behalf of Agents and Requisite Lenders, (ii) no amendment, modification,
termination or waiver of any provision of any Note shall be effective without
the written concurrence of the Lender which is the holder of that Note, (iii) no
amendment, modification, termination or waiver of any provision of any Letter of
Credit shall be effective without the consent of the Issuing Lender of such
Letter of Credit and no amendment, modification, termination or waiver of
Section 3 that changes in any manner the rights and obligations of an Issuing
Lender with respect to an outstanding Letter of Credit shall be effective
without the consent of that Issuing Lender, (iv) no amendment, modification,
termination or waiver of any provision of subsection 2.1A(iv) or of any other
provision of this Agreement relating to the Swing Line Loan Commitment or the
Swing Line Loans shall be effective without the written concurrence of Swing
Line Lender, and (v) no amendment, modification, termination or waiver of any
provision of Section 9 or of any other provision of this Agreement which, by its
terms, expressly requires the approval or concurrence of any Agent shall be
effective without the written concurrence of such Agent, (vi) no amendment,
modification, termination or waiver of any provision of subsection 2.4 which has
the effect of changing any interim scheduled payments, voluntary or mandatory
prepayments, or Commitment reductions applicable to any Class (the "Affected
Class") in a manner that disproportionately disadvantages such Class relative to
the any other Class shall be effective without the written concurrence of
Requisite Class Lenders of the Affected Class (it being understood and agreed
that any amendment, modification, termination or waiver of any such provision
which only postpones or reduces any interim scheduled payment, voluntary or
mandatory prepayment, or Commitment reduction from those set forth in subsection
2.4 with respect to one Class but not the another Class shall be deemed to
disproportionately disadvantage such one Class but not to disproportionately
disadvantage such other Class for purposes of this clause (vi)), (vii) no
amendment, modification, termination or waiver that postpones the date of or
reduces the amount of any scheduled installment of principal of any of the Loans
that becomes effective before the earlier of the second anniversary of the
Closing Date and the last day of any period of two consecutive Fiscal Quarters
for each of which the Consolidated Leverage Ratio has been less than 3.00:1.00
shall be effective without the written concurrence of all Lenders, and (viii) no
amendment, modification, termination or waiver of any Collateral Document having
the effect of securing additional Indebtedness (other than Indebtedness
comprising the Obligations and any Hedge Agreement) by any Collateral shall be
effective without the written concurrence of Lenders having or holding more than
66-2/3% of the sum of the aggregate Tranche A Term Loan Exposure of all Lenders
PLUS the aggregate Tranche B Term Loan Exposure of all Lenders PLUS the
aggregate Revolving Loan Exposure of all Lenders. Any waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
it was given. No notice to or demand on Company in any case shall entitle
Company to any other or further notice or demand in similar or other
circumstances. Any amendment, modification, termination, waiver or consent
effected in accordance with this subsection 10.6 shall be binding upon each
Lender at the time outstanding, each future Lender and, if signed by Company, on
Company. For purposes of this subsection 10.6, Syndication Agent, in
coordination with Administrative Agent, shall have primary responsibility,
together with Company, for the negotiation, preparation and documentation
relating to any amendment, modification or waiver of this Agreement, any other
Loan Document or any other agreement or
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document related hereto or thereto contemplated pursuant to this subsection.
10.7 INDEPENDENCE OF COVENANTS
All covenants hereunder shall be given independent effect so that if
a particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or would otherwise be within
the limitations of, another covenant shall not avoid the occurrence of an Event
of Default or Potential Event of Default if such action is taken or condition
exists.
10.8 NOTICES
Unless otherwise specifically provided herein, any notice or other
communication herein required or permitted to be given shall be in writing and
may be personally served, telexed or sent by telefacsimile or United States mail
or courier service and shall be deemed to have been given when delivered in
person or by courier service, upon receipt of telefacsimile or telex, or three
Business Days after depositing it in the United States mail with postage prepaid
and properly addressed; PROVIDED that notices to Agents shall not be effective
until received. For the purposes hereof, the address of each party hereto shall
be as set forth under such party's name on the signature pages hereof or (i) as
to Company and Agents, such other address as shall be designated by such Person
in a written notice delivered to the other parties hereto and (ii) as to each
other party, such other address as shall be designated by such party in a
written notice delivered to Administrative Agent.
10.9 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS
A. All representations, warranties and agreements made herein shall
survive the execution and delivery of this Agreement and the making of the Loans
and the issuance of the Letters of Credit hereunder.
B. Notwithstanding anything in this Agreement or implied by law to the
contrary, the agreements of Company set forth in subsections 2.6D, 2.7, 3.5A,
3.6, 10.2, 10.3 and 10.4 and the agreements of Lenders set forth in subsections
9.2C, 9.4 and 10.5 shall survive the payment of the Loans, the cancellation or
expiration of the Letters of Credit and the reimbursement of any amounts drawn
thereunder, and the termination of this Agreement.
10.10 FAILURE OR INDULGENCE NOT WAIVER; REMEDIES CUMULATIVE
No failure or delay on the part of any Agent or any Lender in the
exercise of any power, right or privilege hereunder or under any other Loan
Document shall impair such power, right or privilege or be construed to be a
waiver of any default or acquiescence therein, nor shall any single or partial
exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other power, right or privilege. All rights and
remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise available.
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10.11 MARSHALLING; PAYMENTS SET ASIDE
No Agent nor any Lender shall be under any obligation to marshal any
assets in favor of Company or any other party or against or in payment of any or
all of the Obligations. To the extent that Company makes a payment or payments
to Administrative Agent or Lenders (or to Administrative Agent for the benefit
of Lenders), or Administrative Agent or Lenders enforce any security interests
or exercise their rights of setoff, and such payment or payments or the proceeds
of such enforcement or setoff or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, any
other state or federal law, common law or any equitable cause, then, to the
extent of such recovery, the obligation or part thereof originally intended to
be satisfied, and all Liens, rights and remedies therefor or related thereto,
shall be revived and continued in full force and effect as if such payment or
payments had not been made or such enforcement or setoff had not occurred.
10.12 SEVERABILITY
In case any provision in or obligation under this Agreement or the
Notes shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
10.13 OBLIGATIONS SEVERAL; INDEPENDENT NATURE OF LENDERS' RIGHTS
The obligations of Lenders hereunder are several and no Lender shall
be responsible for the obligations or Commitments of any other Lender hereunder.
Nothing contained herein or in any other Loan Document, and no action taken by
Lenders pursuant hereto or thereto, shall be deemed to constitute Lenders as a
partnership, an association, a joint venture or any other kind of entity. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled to protect and enforce its
rights arising out of this Agreement and it shall not be necessary for any other
Lender to be joined as an additional party in any proceeding for such purpose.
10.14 HEADINGS
Section and subsection headings in this Agreement are included
herein for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
10.15 APPLICABLE LAW
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT
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REGARD TO CONFLICTS OF LAWS PRINCIPLES.
10.16 SUCCESSORS AND ASSIGNS
This Agreement shall be binding upon the parties hereto and their
respective successors and assigns and shall inure to the benefit of the parties
hereto and the successors and assigns of Lenders (it being understood that
Lenders' rights of assignment are subject to subsection 10.1). Neither Company's
rights or obligations hereunder nor any interest therein may be assigned or
delegated by Company without the prior written consent of all Lenders.
10.17 CONSENT TO JURISDICTION AND SERVICE OF PROCESS
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST COMPANY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY OBLIGATIONS
THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK OR ANY STATE COURT OF
COMPETENT JURISDICTION IN STATE OF NORTH CAROLINA IN MECKLENBURG COUNTY OR ANY
FEDERAL COURT OF COMPETENT JURISDICTION IN THE WESTERN DISTRICT OF NORTH
CAROLINA. BY EXECUTING AND DELIVERING THIS AGREEMENT, COMPANY, FOR ITSELF AND IN
CONNECTION WITH ITS PROPERTIES, IRREVOCABLY
(i) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE
JURISDICTION AND VENUE OF SUCH COURTS;
(ii) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(iii) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN
ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO COMPANY AT ITS ADDRESS PROVIDED IN ACCORDANCE
WITH SUBSECTION 10.8;
(iv) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS
SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER COMPANY IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND
BINDING SERVICE IN EVERY RESPECT;
(v) AGREES THAT LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST COMPANY
IN THE COURTS OF ANY OTHER JURISDICTION; AND
(vi) AGREES THAT THE PROVISIONS OF THIS SUBSECTION 10.17 RELATING TO
JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO THE FULLEST
EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW SECTION
5-1402 OR OTHERWISE.
141
<PAGE> 149
10.18 WAIVER OF JURY TRIAL
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE
ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY
DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR
THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. The scope of this
waiver is intended to be all-encompassing of any and all disputes that may be
filed in any court and that relate to the subject matter of this transaction,
including without limitation contract claims, tort claims, breach of duty claims
and all other common law and statutory claims. Each party hereto acknowledges
that this waiver is a material inducement to enter into a business relationship,
that each has already relied on this waiver in entering into this Agreement, and
that each will continue to rely on this waiver in their related future dealings.
Each party hereto further warrants and represents that it has reviewed this
waiver with its legal counsel and that it knowingly and voluntarily waives its
jury trial rights following consultation with legal counsel. THIS WAIVER IS
IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING
(OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SUBSECTION
10.18 AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY
TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR
AGREEMENTS RELATING TO THE LOANS MADE HEREUNDER. In the event of litigation,
this Agreement may be filed as a written consent to a trial by the court.
10.19 CONFIDENTIALITY
Each Lender shall hold all non-public information obtained pursuant
to the requirements of this Agreement which has been identified as confidential
by Company or as to which it is reasonably clear that such information is
non-public in accordance with such Lender's customary procedures for handling
confidential information of this nature and in accordance with safe and sound
banking practices, it being understood and agreed by Company that in any event a
Lender may make disclosures to Affiliates and professional advisors of such
Lender or disclosures reasonably required by (a) any bona fide assignee,
transferee or participant in connection with the contemplated assignment or
transfer by such Lender of any Loans or any participations therein or (b) by any
direct or indirect contractual counterparties in swap agreements or such
contractual counterparties' professional advisors provided that such bona fide
assignee, transferee, or participant or such contractual counterparty or
professional advisor to such contractual counterparty, as the case may be,
agrees in writing to keep such information confidential to the same extent
required of the Lenders hereunder, or disclosures required or requested by any
governmental agency or representative thereof or pursuant to legal process, or
disclosures required to be made to the National Association of Insurance
Commissioners; PROVIDED that, unless specifically prohibited by applicable law
or court order, each Lender shall use reasonable efforts to notify Company of
any request by any governmental agency or representative thereof
142
<PAGE> 150
(other than any such request in connection with any examination of the financial
condition of such Lender by such governmental agency) for disclosure of any such
non-public information prior to disclosure of such information; and PROVIDED,
FURTHER that in no event shall any Lender be obligated or required to return any
materials furnished by Company or any of its Subsidiaries.
10.20 COUNTERPARTS; EFFECTIVENESS
This Agreement and any amendments, waivers, consents or supplements
hereto or in connection herewith may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document. This Agreement shall become effective upon the execution of a
counterpart hereof by each of the parties hereto and receipt by Company and
Agents of written or telephonic notification of such execution and authorization
of delivery thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 151
Page S-2 to Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
COMPANY:
PENTON MEDIA, INC.
By: /s/ Joseph G. NeCastro
Title: Chief Financial Officer
Notice Address:
1100 Superior Avenue
Cleveland, OH 44114
Attention: Joseph NeCastro
AGENTS:
DLJ CAPITAL FUNDING, INC.,
individually and as
Syndication Agent
By: /s/ Eric Swanson
------------------------
Title: Managing Director
Notice Address:
277 Park Avenue, 9th Floor
New York, NY 10172
Telephone: (212) 892-2409
Telecopy: (212) 892-5286
Attention: Tom Newberry
FIRST UNION NATIONAL BANK,
individually and as Administrative Agent
By: /s/ David B. Kraybill
------------------------
Title: Vice President
---------------------
Notice Address:
One First Union Center, TW-4
Charlotte, North Carolina, 28288-0608
Attention: George Cole
S-1
<PAGE> 152
THE BANK OF NEW YORK,
individually and as Co-Documentation Agent
By: /s/ Benjamin B. Todres
Title: Vice President
Notice Address:
1 Wall Street
New York, New York 10286
Attention: Benjamin Todres
Telephone: (212) 635-8745
Fax: (212) 635 8593
KEY CORPORATE CAPITAL INC.,
individually and as Co-Documentation Agent
By: /s/ Kenneth Keeler
Title: Senior Vice President
Notice Address:
127 Public Square
Cleveland, Ohio 44114
Attention: Ken Keeler
Telephone: (216) 689-5789
Fax: (216) 689-4666
<PAGE> 153
Page S-3 to Credit Agreement
LENDERS:
CITY NATIONAL BANK
By: /s/ David C. Burdge
------------------------------------
Title: DAVID C. BURDGE
---------------------------------
SENIOR VICE PRESIDENT
Notice Address:
831 South Douglas Street
El Segundo, CA 90245
Telephone: (310) 297-8075
Fax: (310) 297-8171
S-3
<PAGE> 154
Page S-4 to Credit Agreement
<TABLE>
<CAPTION>
DRESDNER BANK AG, NEW
YORK AND GRAND CAYMAN
BRANCHES
<S> <C>
By: /s/ William E. Lambert /s/ Brian Haughney
-------------------------------------------------------
Title: William E. Lambert Brian Haughney
---------------------------------------------------
Assistant Vice President Assistant Treasurer
Notice Address:
75 Wall Street, 29th Floor
New York, NY 1005-2889
Attention:
Telephone: (212) 429-2191
Fax: (212) 574-0129
</TABLE>
S-4
<PAGE> 155
Page S-6 to Credit Agreement
THE FIRST NATIONAL BANK
OF CHICAGO
By: /s/ Richard R. Howard
------------------------------------
Title: Vice President
---------------------------------
Notice Address:
IFNP 0634
Chicago, Illinois 60670
Attention:
S-6
<PAGE> 156
Page S-7 to Credit Agreement
FLEET BANK
By: /s/ Jeffrey J. McLaughlin
------------------------------------
Title: Senior Vice President
---------------------------------
Notice Address:
Fleet Bank Mail Code MA OF D03D
ONE Federal St.
Boston, MA 02110
Attention: Jeff McLaughlin
S-7
<PAGE> 157
Page S-15 to Credit Agreement
NATIONAL CITY BANK
By: /s/ Wade S. Alliance
------------------------------------
Title: Vice President
Notice Address:
1900 East Ninth Street
Cleveland, Ohio 44114
Attention:
Telephone: (216) 575-3198
Fax: (216) 575-9396
S-15
<PAGE> 158
Page S-17 to Credit Agreement
SUMMIT BANK
By: /s/ Kenneth B. Stoddard
------------------------------------
Title: Vice President
---------------------------------
Notice Address:
301 Carnegie Center
Princeton, NJ 08543
Attention: Catherine O'Brien
Telephone: (609) 987-3615
Fax: (609) 734-9125
S-17
<PAGE> 159
Page S-19 to Credit Agreement
UNION BANK OF CALIFORNIA
By: /s/ Peter C. Connoy
------------------------------------
Title: Peter C. Connoy
---------------------------------
Assistant Vice President
Notice Address:
--------------------------------
--------------------------------
--------------------------------
Attention:
S-19
