<PAGE> 1
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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): MARCH 14, 1999
----------
BMC SOFTWARE, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 0-17136 74-21226120
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation or organization) File Number) Identification No.)
2101 CITYWEST BOULEVARD
HOUSTON, TEXAS 77042-2827
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (713) 918-8800
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<PAGE> 2
Item 2. Acquisition or Disposition of Assets.
On April 9, 1999, BMC Software, Inc., a Delaware corporation (the
"Company"), announced that in excess of 95% of the outstanding ordinary shares,
par value NIS 0.01 per share (the "Shares"), of New Dimension Software Ltd., an
Israeli corporation ("New Dimension"), were tendered prior to the expiration of
the Company's previously announced tender offer at 12:00 midnight, New York City
time, on Thursday, April 8, 1999. All Shares validly tendered and not properly
withdrawn prior to the expiration of the tender offer (the "Tendered Shares")
were accepted by the Company on April 9, 1999.
On April 14, 1999, the Company acquired for $52.50 net per Share (the
"Per Share Amount") all of the Tendered Shares. The Per Share Amount was fixed
pursuant to the Share Purchase and Tender Agreement, dated as of March 7, 1999,
between the Company and New Dimension (the "Tender Agreement") and was
determined through arm's length negotiations between the parties prior to the
signing of the Tender Agreement. The Company paid a total of approximately
$614 million in cash to acquire the Tendered Shares. Approximately $500 million
of this amount was funded through the Company's $500 Million Senior Credit
Facility (the "Credit Facility"). The remaining balance was paid from the
Company's working capital. The Credit Agreement related to the Credit Facility,
dated as of April 13, 1999, by and among the Company and various financial
institutions identified therein, is filed herewith as Exhibit 99.1 and
incorporated herein by reference.
Additionally, in accordance with the Tender Agreement, the Company has
agreed to reimburse New Dimension for payments made to the holders of options
granted under stock option plans of New Dimension or any subsidiary of New
Dimension (the "Options") in exchange for the cancellation of such Options. The
aggregate amount of such reimbursement will be approximately $40.5 million.
The Company intends to acquire the remaining outstanding Shares of New
Dimension pursuant to Section 236 of the Companies' Ordinance (New Version)
5743-1983 of the State of Israel. In accordance with Section 236, the Company
will declare by notice to the remaining shareholders that it is unilaterally
acquiring (the "Compulsory Acquisition") the remaining outstanding Shares not
yet held by it on the same terms as those purchased in the tender offer. The
Company anticipates that the Compulsory Acquisition will cost approximately
$32.5 million and will be paid from the Company's working capital.
The Tender Agreement is incorporated herein by reference to the
Company's Tender Offer Statement on Schedule 14D-1, filed with the Commission on
March 11, 1999. A description of the tender offer, including additional
information required pursuant to Item 2 of Form 8-K, is contained in the Tender
Offer Statement, the text of which is incorporated herein by reference. A
description of the expiration of the tender offer and the acceptance by the
Company for payment of the Tendered Shares is set forth in the April 9, 1999
press release of the Company, which is contained in the Company's Tender Offer
Statement and incorporated herein by reference. A description of the closing of
the tender offer is contained in the April 14, 1999 press release of the
Company, which is filed herewith as Exhibit 99.3 and incorporated herein by
reference.
<PAGE> 3
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired
It is impracticable for the Company to file herewith the required
financial statements in this Current Report on Form 8-K. The required financial
statements will be filed by amendment as soon as practicable, but not later than
60 days after the date this Current Report on Form 8-K is required to be filed.
(b) Pro Forma Financial Information
It is impracticable for the Company to file herewith the required pro
forma financial information in this Current Report on Form 8-K. The required pro
forma financial information will be filed by amendment as soon as practicable,
but not later than 60 days after the date this Current Report on Form 8-K is
required to be filed.
(c) Exhibits
The following Exhibits are filed as part of this report:
2.1 Share Purchase and Tender Agreement, dated March
7, 1999, between the Company and New Dimension
(incorporated by reference to Exhibit (c)(1) of
the Company's Tender Offer Statement on Schedule
14D-1 as filed with the Commission on March 11,
1999, and as amended on April 9, 1999).
99.1 Credit Agreement, dated as of April 13, 1999, by
and among the Company and various financial
institutions.
99.2 Press release of the Company, dated April 9, 1999
(incorporated by reference to Exhibit (a)(11) of
Final Tender Offer Statement on Schedule 14D-1/A
as filed with the Securities and Exchange
Commission on April 9, 1999).
99.3 Press release of the Company, dated April 14, 1999.
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BMC SOFTWARE, INC.
Date: April 28, 1999 By: /s/ M. Brinkley Morse
------------------------------
Name: M. Brinkley Morse
Title: Senior Vice President
<PAGE> 5
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
------ -----------
<S> <C>
2.1 Share Purchase and Tender Agreement, dated March 7,
1999, between the Company and New Dimension
(incorporated by reference to Exhibit (c)(1) of the
Company's Tender Offer Statement on Schedule 14D-1 as
filed with the Commission on March 11, 1999, and as
amended on April 9, 1999).
99.1 Credit Agreement, dated as of April 13, 1999, by and
among the Company and various financial institutions.
99.2 Press release of the Company, dated April 9, 1999
(incorporated by reference to Exhibit (a)(11) of Final
Tender Offer Statement on Schedule 14D-1/A as filed with
the Securities and Exchange Commission on April 9,
1999).
99.3 Press release of the Company, dated April 14, 1999.
</TABLE>
<PAGE> 1
EXHIBIT 99.1
EXECUTION COPY
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CREDIT AGREEMENT
DATED AS OF
APRIL 13, 1999
AMONG
BMC SOFTWARE, INC.,
AS BORROWER
THE LENDERS NAMED HEREIN
THE ISSUING BANK NAMED HEREIN
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION,
AS ADMINISTRATIVE AGENT
NATIONSBANK, NATIONAL ASSOCIATION,
AS SYNDICATION AGENT
ABN AMRO BANK, N.V.,
AS DOCUMENTATION AGENT
THE CHASE MANHATTAN BANK,
AS AUCTION ADMINISTRATION AGENT
AND
CHASE SECURITIES INC.,
AS BOOK MANAGER/LEAD ARRANGER
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<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE I DEFINITIONS....................................................................1
Section 1.01. Defined Terms..................................................................1
Section 1.02. Classification of Loans and Borrowings........................................20
Section 1.03. Terms Generally...............................................................20
Section 1.04. Accounting Terms; GAAP........................................................21
ARTICLE II THE CREDITS...................................................................21
Section 2.01. Commitments...................................................................21
Section 2.02. Loans and Borrowings..........................................................21
Section 2.03. Requests for Revolving Borrowings.............................................22
Section 2.04. Competitive Bid Procedure.....................................................23
Section 2.05. INTENTIONALLY OMITTED.........................................................25
Section 2.06. Letters of Credit.............................................................25
Section 2.07. Funding of Borrowings.........................................................29
Section 2.08. Interest Elections............................................................30
Section 2.09. Termination and Reduction of Commitments......................................31
Section 2.10. Repayment of Loans; Evidence of Debt..........................................32
Section 2.11. Prepayment of Loans...........................................................32
Section 2.12. Fees..........................................................................33
Section 2.13. Interest......................................................................34
Section 2.14. Alternate Rate of Interest....................................................35
Section 2.15. Increased Costs...............................................................36
Section 2.16. Break Funding Payments........................................................37
Section 2.17. Taxes.........................................................................38
Section 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs...................39
Section 2.19. Mitigation Obligations; Replacement of Lenders................................41
ARTICLE III REPRESENTATIONS AND WARRANTIES................................................42
Section 3.01. Organization; Powers..........................................................42
Section 3.02. Authorization; Enforceability.................................................42
Section 3.03. Governmental Approvals; No Conflicts..........................................42
Section 3.04. Financial Condition; No Material Adverse Change...............................42
Section 3.05. Properties....................................................................43
Section 3.06. Litigation and Environmental Matters..........................................43
Section 3.07. Compliance with Laws and Agreements...........................................43
Section 3.08. Investment and Holding Company Status.........................................44
Section 3.09. Taxes.........................................................................44
Section 3.10. ERISA.........................................................................44
Section 3.11. Disclosure....................................................................44
Section 3.12. Year 2000.....................................................................44
Section 3.13. Margin Stock..................................................................45
</TABLE>
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<TABLE>
<S> <C>
ARTICLE IV CONDITIONS..................................................................45
Section 4.01. Effective Date..............................................................45
Section 4.02. Each Credit Event...........................................................46
ARTICLE V AFFIRMATIVE COVENANTS.......................................................47
Section 5.01. Financial Statements; Ratings Change and Other Information..................47
Section 5.02. Notices of Material Events..................................................48
Section 5.03. Existence; Conduct of Business..............................................49
Section 5.04. Payment of Obligations......................................................49
Section 5.05. Maintenance of Properties; Insurance........................................49
Section 5.06. Books and Records; Inspection Rights........................................49
Section 5.07. Compliance with Laws........................................................49
Section 5.08. Use of Proceeds.............................................................50
Section 5.09. Year 2000...................................................................50
ARTICLE VI FINANCIAL AND NEGATIVE COVENANTS............................................50
Section 6.01. Financial Covenants. .......................................................50
Section 6.02. Liens.......................................................................50
Section 6.03. Fundamental Changes.........................................................52
Section 6.04. Sale-and-Leaseback Transactions.............................................52
Section 6.05. Hedging Agreements..........................................................52
Section 6.06. Restricted Payments.........................................................52
Section 6.07. Transactions with Affiliates................................................52
Section 6.08. Restrictive Agreements......................................................53
Section 6.09. Line of Business............................................................53
Section 6.10. Subsidiaries................................................................53
ARTICLE VII EVENTS OF DEFAULT...........................................................54
ARTICLE VIII THE AGENTS..................................................................57
Section 8.01. Authorization, Action and Reliance..........................................57
Section 8.02. Successor Administrative Agent..............................................58
Section 8.03. Successor Auction Administration Agent......................................58
Section 8.04. No Duty.....................................................................59
ARTICLE IX MISCELLANEOUS...............................................................59
Section 9.01. Notices.....................................................................59
Section 9.02. Waivers; Amendments; Replacement Notes......................................61
Section 9.03. Expenses; Indemnity; Damage Waiver..........................................62
Section 9.04. Successors and Assigns......................................................64
Section 9.05. Survival....................................................................66
</TABLE>
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<TABLE>
<S> <C>
Section 9.06. Counterparts; Integration; Effectiveness....................................66
Section 9.07. Severability................................................................67
Section 9.08. Right of Setoff.............................................................67
Section 9.09. Governing Law; Jurisdiction; Consent to Service of Process..................67
Section 9.10. Waiver of Jury Trial........................................................68
Section 9.11. Headings....................................................................68
Section 9.12. Confidentiality.............................................................68
Section 9.13. Interest Rate Limitation....................................................69
Section 9.14. Final Agreement.............................................................71
</TABLE>
SCHEDULES:
Schedule 1.01 Permitted Investments
Schedule 3.06 Disclosed Matters
Schedule 5.01 Compliance Certificate
Schedule 6.02 Existing Liens
Schedule 6.08 Existing Restrictions
EXHIBITS:
Exhibit 1.01-A Form of Administrative Questionnaire
Exhibit 1.01-B Form of Revolving Note
Exhibit 1.01-C Form of Competitive Note
Exhibit 2.03 Borrowing Request
Exhibit 2.04-A Form of Competitive Bid Request
Exhibit 2.04-B Notice to Lenders of Competitive Bid Request
Exhibit 2.04-C Competitive Bid
Exhibit 6.10 Form of Subordination Agreement
Exhibit 9.04 Form of Assignment and Acceptance
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CREDIT AGREEMENT
CREDIT AGREEMENT dated as of April 13, 1999, is among:
(a) BMC SOFTWARE, INC., a Delaware corporation (the "Borrower");
(b) the banks and other financial institutions named under the caption
"Lenders" on the signature pages hereof (together with each other Person who
becomes a Lender pursuant to Section 9.04 collectively, the "Lenders");
(c) CHASE BANK OF TEXAS, NATIONAL ASSOCIATION, a national banking
association, as Issuing Bank (in such capacity together with any other Person
who becomes the Issuing Bank pursuant to Section 2.06(i), (the "Issuing Bank");
(d) CHASE BANK OF TEXAS, NATIONAL ASSOCIATION, a national banking
association, as administrative agent for the Lenders (in such capacity together
with any other Person who becomes the Administrative Agent pursuant to Section
8.02, the "Administrative Agent");
(e) NATIONSBANK, NATIONAL ASSOCIATION, a national banking association,
as syndication agent (in such capacity, the "Syndication Agent");
(f) ABN AMRO BANK, N.V., a Netherlands banking corporation, as
documentation agent for the Lenders ( in such capacity, the "Documentation
Agent"); and
(g) THE CHASE MANHATTAN BANK, a New York banking corporation, as
auction administration agent for the Lenders (in such capacity together with any
other Person who becomes the Auction Administration Agent pursuant to Section
8.03, the "Auction Administration Agent").
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Alternate Base Rate.
<PAGE> 6
"Additional Interest" has the meaning specified in Section 9.13.
"Adjusted LIBO Rate" means, with respect to any Eurodollar Borrowing
for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest
Period multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" has the meaning specified in the introduction to
this Agreement.
"Administrative Agent's Letter" means the letter agreement dated March
10, 1999 among the Borrower, the Administrative Agent and Chase Securities Inc.
"Administrative Questionnaire" means an Administrative Questionnaire in
the form of Exhibit 1.01-A.
"Affiliate" means, with respect to a specified Person, another Person
that directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
"Agents" means the Administrative Agent and the Auction Administration
Agent.
"Agreement" means this Credit Agreement dated as of April 13, 1999.
"Alternate Base Rate" means, for any day, a rate per annum equal to the
greater of (a) the Prime Rate in effect on such day and (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. Any change in the Alternate
Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate
shall be effective from and including the effective date of such change in the
Prime Rate or the Federal Funds Effective Rate, respectively.
"Applicable Differential" means, for any day, with respect to any
Eurodollar Revolving Loan, or with respect to the Facility Fees payable
hereunder, as the case may be, the applicable rate per annum set forth below
under the caption "Eurodollar Spread" or "Facility Fee Spread", as the case may
be, based upon the ratings by Moody's and S&P, respectively, applicable on such
date to the Index Debt:
<TABLE>
<CAPTION>
Rating by: Rating by: Eurodollar Facility
S&P Moody's Spread Fee Rate
- ---------- -------------- -------------- ---------- --------
<S> <C> <C> <C> <C>
Category 1 BBB+ or higher Baal or higher .375% .125%
Category 2 BBB Baa2 .600% .150%
Category 3 BBB- Baa3 .825% .175%
Category 4 BB+ or less Ba1 or less 1.000% .250%
</TABLE>
For purposes of the foregoing, (i) if either Moody's or S&P shall not
have in effect a rating for the Index Debt (other than by reason of the
circumstances referred to in the last sentence
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<PAGE> 7
of this definition), then such rating agency shall be deemed to have established
a rating in Category 4; (ii) if the ratings established or deemed to have been
established by Moody's and S&P for the Index Debt shall fall within different
Categories, the Applicable Differential shall be based on the lower of the two
ratings; and (iii) if the ratings established or deemed to have been established
by Moody's and S&P for the Index Debt shall be changed (other than as a result
of a change in the rating system of Moody's or S&P), such change shall be
effective as of the date on which it is first announced by the applicable rating
agency, irrespective of when notice of such change shall have been furnished by
the Borrower to the Administrative Agent and the Lenders pursuant to Section
5.01(f) hereof or otherwise. Each change in the Applicable Differential shall
apply during the period commencing on the effective date of such change and
ending on the date immediately preceding the effective date of the next such
change. If the rating system of Moody's or S&P shall change, or if either such
rating agency shall cease to be in the business of rating corporate debt
obligations, the Borrower and the Lenders shall negotiate in good faith to amend
this definition to reflect such changed rating system or the unavailability of
ratings from such rating agency and, pending the effectiveness of any such
amendment, the Applicable Differential shall be determined by reference to the
rating most recently in effect prior to such change or cessation.
"Applicable Lending Office" means, with respect to each Lender, such
Lender's Domestic Lending Office in the case of an ABR Loan or a Fixed Rate
Loan, and such Lender's Eurodollar Lending Office in the case of a Eurodollar
Loan.
"Applicable Margin" means the Applicable Rate; provided, however, that
from and after the first date on which any Index Debt shall be rated by both
Moody's and S&P (and whether or not any Index Debt thereafter continues to be
rated by both Moody's and S&P), the Applicable Margin shall be the Applicable
Differential; provided, however, if on the Termination Date any Loans are
outstanding, the Applicable Differential set forth under the caption "Eurodollar
Spread" in Categories 1 through 4 of that definition shall increase by .125%,
and the Applicable Rate set forth under the caption "Eurodollar Spread" in
clause (b)(i) through (iv) of that definition shall increase by .125%.
"Applicable Percentage" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's Commitment. If
the Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon the Commitments most recently in effect, giving effect to
any assignments.
"Applicable Rate" means, for any day, with respect to any Eurodollar
Revolving Borrowing, or with respect to the Facility Fees payable hereunder, as
the case may be, the rate per annum set forth below under the caption
"Eurodollar Spread" or "Facility Fee Spread", as the case may be:
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(a) during the period from the Execution Date to the Financial
Statement Delivery Date for the fiscal quarter of the Borrower ending June 30,
1999, the Applicable Rate shall be as follows:
<TABLE>
<CAPTION>
EURODOLLAR SPREAD FACILITY FEE SPREAD
----------------- -------------------
<S> <C>
.625% .125%
</TABLE>
(b) on each Financial Statement Delivery Date thereafter, the
Applicable Rate shall be determined with respect to the financial statements
delivered pursuant to Section 5.01(a) or Section 5.01(b), as the case may be, on
such Financial Statement Delivery Date with respect to a fiscal quarter or
fiscal year, as the case may be, of the Borrower, as follows:
(i) if at the end of such fiscal quarter or fiscal year, the
ratio of Consolidated Indebtedness to Consolidated EBITDA for the four
full fiscal quarters then most recently ended is greater than 2.25 to
1.0:
<TABLE>
<CAPTION>
EURODOLLAR SPREAD FACILITY FEE SPREAD
----------------- -------------------
<S> <C>
.925% .200%
</TABLE>
(ii) if at the end of such fiscal quarter or fiscal year, the
ratio of Consolidated Indebtedness to Consolidated EBITDA for the four
full fiscal quarters then most recently ended is equal to or less than
2.25 to 1.0 but greater than 1.50 to 1.0:
<TABLE>
<CAPTION>
EURODOLLAR SPREAD FACILITY FEE SPREAD
----------------- -------------------
<S> <C>
.725% .150%
</TABLE>
(iii) if at the end of such fiscal quarter or fiscal year, the
ratio of Consolidated Indebtedness to Consolidated EBITDA for the four
full fiscal quarters then most recently ended is equal to or less than
1.50 to 1.0 but greater than .75 to 1.0:
<TABLE>
<CAPTION>
EURODOLLAR SPREAD FACILITY FEE SPREAD
----------------- -------------------
<S> <C>
.625% .125%
</TABLE>
(iv) if at the end of such fiscal quarter or fiscal year, the
ratio of Consolidated Indebtedness to Consolidated EBITDA for the four
full fiscal quarters then most recently ended is equal to or less than
.75 to 1.0:
<TABLE>
<CAPTION>
EURODOLLAR SPREAD FACILITY FEE SPREAD
----------------- -------------------
<S> <C>
.525% .100%
</TABLE>
Notwithstanding the foregoing, if on or after any Financial Statement
Delivery Date for any fiscal quarter or fiscal year of the Borrower ending on or
after June 30, 1999 any of the financial statements required pursuant to Section
5.01(a) or Section 5.01(b), as the case may be, shall
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not have been timely delivered, the Applicable Rate shall be determined pursuant
to clause (b)(i) above until the date that is five Business Days after the date
such statements are delivered.
Each change in the Applicable Rate shall become effective five Business
Days after the Administrative Agent receives notification of the financial
statements containing the information forming the basis of such change.
"Applicable Usury Laws" has the meaning specified in Section 9.13.
"Assignment and Acceptance" has the meaning specified in Section 9.04.
"Attributable Debt" means, as to any particular lease relating to a
Sale-and-Leaseback Transaction or a Synthetic Lease Transaction, the greater of
(a) the present value of all Lease Rentals required to be paid by the Borrower
or any Subsidiary under such lease during the remaining term thereof (determined
in accordance with generally accepted financial practice using a discount factor
equal to the interest rate implicit in such lease if known or, if not known, of
6% per annum) and (b) the Fair Market Value of the property subject to such
Sale-and-Leaseback Transaction or such Synthetic Lease Transaction, as the case
may be, as determined at the time of consummation of such Sale-and-Leaseback
Transaction or such Synthetic Lease Transaction, as the case may be.
"Auction Administration Agent" has the meaning specified in the
introduction to this Agreement.
"Auction Administration Agent's Letter" means the letter agreement
dated March 24, 1999 between the Borrower and The Chase Manhattan Bank.
"Availability Period" means the period from and including the Effective
Date to but excluding the earlier of the Termination Date and the date of
termination of the Commitments.
"Board" means the Board of Governors of the Federal Reserve System of
the United States of America.
"Borrower" has the meaning specified in the introduction to this
Agreement.
"Borrowing" means (a) a Revolving Borrowing or (b) a Competitive
Borrowing.
"Borrowing Request" has the meaning specified in Section 2.03.
"Business Day" means any day (other than a day which is a Saturday,
Sunday or legal holiday in the State of New York or Texas) on which banks are
open for business in New York City and in Houston, Texas; provided, however,
that, when used in connection with a Eurodollar Loan,
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<PAGE> 10
the term "Business Day" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
"Calculation Period" has the meaning specified in Section 2.12.
"Capital Lease" means, as to any Person, any lease in respect of which
the rental obligation of such Person constitutes a Capital Lease Obligation.
"Capital Lease Obligations" means, as to any Person, the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as a capital lease obligation on a balance sheet of such Person
under GAAP, and the amount of such obligations shall be the capitalized amount
thereof determined in accordance with GAAP.
"Change in Control" means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934, as amended, and the rules of the
Securities and Exchange Commission thereunder as in effect on the Execution
Date) other than Permitted Investors, of shares representing more than 20% of
the aggregate ordinary voting power represented by the issued and outstanding
capital stock of the Borrower; (b) occupation of a majority of the seats (other
than vacant seats) on the board of directors of the Borrower by Persons who were
neither (i) nominated by the board of directors of the Borrower nor (ii)
appointed by directors so nominated; or (c) the acquisition of direct or
indirect Control of the Borrower by any Person or group other than Permitted
Investors.
"Change in Law" means (a) the adoption of any law, rule or regulation
after the Execution Date, (b) any change in any law, rule or regulation or in
the interpretation or application thereof by any Governmental Authority after
the Execution Date or (c) compliance by any Lender or the Issuing Bank (or, for
purposes of Section 2.15(b), by any lending office of such Lender or the Issuing
Bank or by such Lender's or the Issuing Bank's holding company, if any) with any
request, guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the Execution Date.
"Chase" means The Chase Manhattan Bank, a New York banking corporation.
"Chase of Texas" means Chase Bank of Texas, National Association, a
national banking association.
"Class", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans
or Competitive Loans.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
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<PAGE> 11
"Commitment" means, with respect to each Lender, the commitment of such
Lender to make Revolving Loans and to acquire participations in Letters of
Credit expressed as an amount representing the maximum aggregate amount of such
Lender's Revolving Credit Exposure hereunder, as such commitment may be (a)
reduced from time to time pursuant to Section 2.09 and (b) reduced or increased
from time to time pursuant to assignments by or to such Lender pursuant to
Section 9.04. The initial amount of each Lender's Commitment is set forth
opposite such Lender's name on the signature pages hereof or in the Assignment
and Acceptance pursuant to which such Lender shall have assumed its Commitment,
as applicable. The initial aggregate amount of the Lenders' Commitments is
$500,000,000.
"Communications" has the meaning specified in Section 9.01.
"Competitive Bid" means an offer by a Lender to make a Competitive Loan
substantially in the form of Exhibit 2.04-C.
"Competitive Bid Rate" means, with respect to any Competitive Bid, the
Margin or the Fixed Rate, as applicable, offered by the Lender making such
Competitive Bid.
"Competitive Bid Request" means a request by the Borrower for
Competitive Bids in accordance with Section 2.04 substantially in the form of
Exhibit 2.04-A.
"Competitive Borrowing" means a borrowing consisting of a Competitive
Loan or concurrent Competitive Loans of the same Type, as to which a single
Interest Period is in effect and made on the same date by the Lender or Lenders
whose Competitive Bid as all or as a part of such borrowing, as the case may be,
has been accepted by the Borrower under the bidding procedure described in
Section 2.04.
"Competitive Loan" means a Loan made pursuant to Section 2.04.
"Competitive Note" means a promissory note of the Borrower payable to
the order of a Lender, in substantially the form of Exhibit 1.01-C, together
will all modifications, extensions, renewals and rearrangements thereof.
"Consolidated EBITDA" means, in respect of any period, the sum of (a)
Consolidated Net Income for such period and (b) the amount of all interest,
taxes, depreciation and amortization allowances and other non-cash expenses of
the Borrower and the Subsidiaries and (c) non-recurring non-cash charges
associated with acquired research and development costs, but in the case of
clauses (b) and (c) only to the extent deducted in the determination of
Consolidated Net Income for such period; provided, however, that, for purposes
of the foregoing, Consolidated Net Income, and the non-cash expenses and charges
enumerated in clauses (b) and (c), for any period shall include the net income,
and like non-cash expenses and charges, for such entire period of any Person
acquired during such period as if such Person had been acquired on the first day
of such period, regardless whether by acquisition by the Borrower or one or more
Subsidiaries of all or substantially all its
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assets, or by acquisition of equity interests in such Person sufficient to
constitute it a Subsidiary upon consummation of such acquisition.
"Consolidated Indebtedness" means, as of the date of determination, the
total of all Indebtedness of the Borrower and the consolidated Subsidiaries
outstanding on such date, consolidated in accordance with GAAP and after
eliminating all offsetting debits and credits between the Borrower and the
Subsidiaries and all other items required to be eliminated in the course of the
preparation of consolidated financial statements of the Borrower and such
Subsidiaries in accordance with GAAP.
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) of the Borrower and the Subsidiaries for such period (taken as
a cumulative whole), as determined and consolidated in accordance with GAAP and
after eliminating all offsetting debits and credits between the Borrower and the
consolidated Subsidiaries and all other items required to be eliminated in the
course of the preparation of consolidated financial statements of the Borrower
and such Subsidiaries in accordance with GAAP; provided, however, Consolidated
Net Income shall exclude extraordinary gains and losses, interest and other
income from investments and any income not from operations, including income
from the sale of receivables.
"Control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
"Default" means any event or condition which, upon notice, lapse of
time or both, would, unless cured or waived, become an Event of Default.
"Disclosed Matters" means the actions, suits and proceedings and the
environmental matters disclosed in Schedule 3.06.
"Distribution" means BMC Software Distribution, Inc., a Delaware
corporation, and a Wholly-owned Subsidiary.
"Documentation Agent" has the meaning specified in the introduction to
this Agreement.
"dollars" or "$" refers to lawful money of the United States of
America.
"Domestic Lending Office" means, with respect to any Lender, the office
of such Lender specified as its "Domestic Lending Office" on such Lender's
signature page to this Agreement or, as to any Person who becomes a Lender after
the Execution Date, on the signature page of the Assignment and Acceptance
executed by such Lender or such other office of such Lender
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as such Lender may hereafter designate from time to time as its "Domestic
Lending Office" by notice to the Borrower and the Administrative Agent.
"Domestic Subsidiary" means, when used with respect to any Subsidiary,
a Subsidiary organized under the laws of one of the states of the United States
or the District of Columbia.
"Effective Date" means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 9.02).
"Eligible Assignee" means (a) any Lender or any Affiliate of a Lender;
(b) a commercial bank organized under the laws of the United States, or any
state thereof, and having total assets in excess of $1,000,000,000; (c) a
commercial bank organized under the laws of any other country which is a member
of the OECD, or a political subdivision of any such country, and having total
assets in excess of $1,000,000,000; provided that such bank is acting through a
branch or agency located in the country in which it is organized or another
country which is also a member of the OECD; (d) the central bank of any country
which is a member of the OECD; and (e) any other financial institution approved
by the Administrative Agent and the Borrower (which approval shall not be
unreasonably withheld).
"Environmental Laws" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or to health and safety matters.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
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"ERISA Event" means (a) any "reportable event", as defined in Section
4043 of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30-day notice period is waived); (b) the existence
with respect to any Plan of an "accumulated funding deficiency" (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the
receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by
any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.
"Eurodollar", when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate (or, in the
case of a Competitive Loan, the LIBO Rate).
"Eurodollar Lending Office" means, with respect to each Lender, the
branches or Affiliates of such Lender which such Lender has designated as its
"Eurodollar Lending Office" on such Lender's signature page to this Agreement
or, as to any Person who becomes a Lender after the Execution Date, on the
signature page of the Assignment and Acceptance executed by such Lender or such
other office of any Lender as such Lender may hereafter designate from time to
time as its "Eurodollar Lending Office" by notice to the Borrower and the
Administrative Agent.
"Event of Default" has the meaning assigned to such term in Article
VII.
"Excluded Domestic Subsidiary" means (a) BMC Receivables Corporation
No. 1, BMC Receivables Corporation No. 2, BMC Receivables Corporation No. 3 and
BMC Receivables Corporation No. 4, each a Delaware corporation, and (b) each
other Domestic Subsidiary (i) not less than 97% of the outstanding equity of
which is owned, directly or indirectly, by the Borrower, (ii) whose financial
statements are not consolidated with those of the Borrower as a result of the
application of Financial Accounting Standards Board Statement No. 125 and
Emerging Issue Task Force Issue No. 96-20 and (iii) that is formed solely for
the purpose of, and is engaged only in, the purchase from Distribution, or other
Wholly-owned Subsidiary of receivables or other rights to receive payment and
the sale, securitization and monetization of such receivables or other rights.
"Excluded Taxes" means, with respect to the Administrative Agent, any
Lender, the Issuing Bank or any other recipient of any payment to be made by or
on account of any obligation of the Borrower hereunder, (a) income or franchise
taxes imposed on (or measured by) its net income by the United States of
America, or by the jurisdiction under the laws of which such recipient is
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<PAGE> 15
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located and (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which the Borrower is located.
"Execution Date" means the date of execution and delivery of this
Agreement by the parties hereto.
"Facility Fee" has the meaning specified in Section 2.12.
"Fair Market Value" means, at any time and with respect to any
property, the sale value of such property that would be realized in an
arm's-length sale at such time between an informed and willing buyer and an
informed and willing seller (neither being under a compulsion to buy or sell).
"Family" means, in respect of any individual, the heirs, legatees,
descendants and blood relatives to the third degree of consanguinity of such
individual.
"Family Trusts" means, in respect of any individual, any trusts for the
exclusive benefit of such individual, his/her spouse and lineal descendants, so
long as such individual has the exclusive right to control each such trust.
"Federal Funds Effective Rate" means, for any day, the weighted average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight federal funds transactions with members of the Federal Reserve System
arranged by federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by it.
"Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or controller of the Borrower.
"Financial Statement Delivery Date" means the date on which the annual
or quarterly financial statements of the Borrower are to be delivered pursuant
to Section 5.01(a) or Section 5.01(b), as the case may be.
"Fixed Rate" means, with respect to any Competitive Loan (other than a
Eurodollar Competitive Loan), the fixed rate of interest per annum specified by
the Lender making such Competitive Loan in its related Competitive Bid.
"Fixed Rate Loan" means a Competitive Loan bearing interest at a Fixed
Rate.
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<PAGE> 16
"Foreign Lender" means any Lender that is organized under the laws of a
jurisdiction other than the United States of America, a state thereof or the
District of Columbia.
"GAAP" means generally accepted accounting principles in the United
States of America.
"Governmental Authority" means the government of the United States of
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Guarantee" of or by any Person (the "guarantor") means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the "primary obligor") in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business.
"Hazardous Materials" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"Hedging Agreement" means any interest rate protection agreement,
foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging arrangement.
"Highest Lawful Rate" has the meaning specified in Section 9.13.
"Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such
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<PAGE> 17
Person, (e) all obligations of such Person in respect of the deferred purchase
price of property or services (excluding current accounts payable incurred in
the ordinary course of business), (f) all Indebtedness of others secured by (or
for which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on property owned or acquired by such
Person, whether or not the Indebtedness secured thereby has been assumed, (g)
all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease
Obligations and Attributable Debt of such Person, (i) all obligations,
contingent or otherwise, in respect of credit facilities or liquidity facilities
entered into in connection with any asset securitization program, (j) all
obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty and (k) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances. The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Index Debt" means the Borrower's senior, unsecured, non-credit
enhanced Indebtedness.
"Information" has the meaning specified in Section 9.12.
"Information Memorandum" means the Confidential Information Memorandum
dated March 1999 relating to the Borrower and the Transactions.
"Interest Election Request" means a request by the Borrower to convert
or continue a Revolving Borrowing in accordance with Section 2.08.
"Interest Payment Date" means (a) with respect to any ABR Loan, the
last day of each June, September, December and March, (b) with respect to any
Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing
of which such Loan is a part and, in the case of a Eurodollar Borrowing with an
Interest Period of more than three months' duration, each day prior to the last
day of such Interest Period that occurs at intervals of three months' duration
after the first day of such Interest Period and (c) with respect to any Fixed
Rate Loan, the last day of the Interest Period applicable to the Borrowing of
which such Loan is a part and, in the case of a Fixed Rate Borrowing with an
Interest Period of more than 90 days' duration (unless otherwise specified in
the applicable Competitive Bid Request), each day prior to the last day of such
Interest Period that occurs at intervals of 90 days' duration after the first
day of such Interest Period, and any other dates that are specified in the
applicable Competitive Bid Request as Interest Payment Dates with respect to
such Borrowing.
"Interest Period" means (a) with respect to any Eurodollar Borrowing,
the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the
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calendar month that is one, two, three or six months thereafter and (b) with
respect to any Fixed Rate Borrowing, the period (which shall not be less than 7
days or more than 180 days) commencing on the date of such Borrowing and ending
on the date specified in the applicable Competitive Bid Request; provided, that
(i) if any Interest Period would end on a day other than a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless, in
the case of a Eurodollar Borrowing only, such next succeeding Business Day would
fall in the next calendar month, in which case such Interest Period shall end on
the next preceding Business Day and (ii) any Interest Period pertaining to a
Eurodollar Borrowing that commences on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar month of such Interest Period. For purposes hereof, the date
of a Borrowing initially shall be the date on which such Borrowing is made and,
in the case of a Revolving Borrowing, thereafter shall be the effective date of
the most recent conversion or continuation of such Borrowing.
"Issuing Bank" has the meaning specified in the introduction to this
Agreement. The Issuing Bank may, in its discretion, arrange for one or more
Letters of Credit to be issued by Affiliates of the Issuing Bank, in which case
the term "Issuing Bank" shall include any such Affiliate with respect to Letters
of Credit issued by such Affiliate.
"LC Disbursement" means a payment made by the Issuing Bank pursuant to
a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate undrawn
amount of all outstanding Letters of Credit at such time plus (b) the aggregate
amount of all LC Disbursements that have not yet been reimbursed by or on behalf
of the Borrower at such time. The LC Exposure of any Lender at any time shall be
its Applicable Percentage of the total LC Exposure at such time.
"Lease Rentals" means, with respect to any lease relating to a
Sale-and-Leaseback Transaction, the sum of the rental and other obligations
required to be paid by the Borrower or any Subsidiary as lessee under such
lease, excluding any amount required to be paid by the lessee (whether or not
therein designated as rental or additional rental) on account of maintenance and
repairs, insurance, taxes, assessments, water rates and similar charges.
"Lenders" has the meaning specified in the introduction to this
Agreement.
"Letter of Credit" means any letter of credit issued pursuant to this
Agreement.
"LIBO Rate" means, with respect to any Eurodollar Borrowing for any
Interest Period, the rate appearing on Page 3750 of Telerate (or on any
successor or substitute page of such Service, or any successor to or substitute
for such Service, providing rate quotations comparable to those currently
provided on such page of such Service, as determined by the Administrative Agent
from time to time for purposes of providing quotations of interest rates
applicable to dollar deposits in the
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<PAGE> 19
London interbank market) at approximately 11:00 a.m., London time, two Business
Days prior to the commencement of such Interest Period, as the rate for dollar
deposits with a maturity comparable to such Interest Period. In the event that
such rate is not available at such time for any reason, then the "LIBO Rate"
with respect to such Eurodollar Borrowing for such Interest Period shall be the
rate at which dollar deposits of $5,000,000 and for a maturity comparable to
such Interest Period are offered by the principal London office of the
Administrative Agent in immediately available funds in the London interbank
market at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, hypothecation, encumbrance, charge or security interest in,
on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, Capital Lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
"Loan Documents" means, collectively, this Agreement, the Notes, the
Administrative Agent's Letter, the Subsidiary Guaranties, if any, the
Subordination Agreements, the Auction Administration Agent's Letter and all
other instruments and documents from time to time executed and delivered by the
Borrower or any Material Domestic Subsidiary in connection herewith and
therewith.
"Loans" means the loans made by the Lenders to the Borrower pursuant to
this Agreement.
"Margin" means, with respect to any Competitive Loan bearing interest
at a rate based on the LIBO Rate, the marginal rate of interest, if any, to be
added to or subtracted from the LIBO Rate to determine the rate of interest
applicable to such Loan, as specified by the Lender making such Loan in its
related Competitive Bid.
"Material Adverse Effect" means a material adverse effect on (a) the
business, assets, operations, prospects or condition, financial or otherwise, of
the Borrower and the Subsidiaries taken as a whole, (b) the ability of the
Borrower to perform any of its obligations under this Agreement or (c) the
rights of or benefits available to the Agents and the Lenders under this
Agreement.
"Material Domestic Subsidiary" means each Domestic Subsidiary that at
the end of any fiscal quarter has (a) attributed to it a portion of Consolidated
EBITDA for such quarter and the immediately three preceding fiscal quarters
equal to or in excess of 10% of Consolidated EBITDA for such period, (b) gross
revenues equal to or in excess of 10% of the gross revenues of the Borrower and
the Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP, or (c) assets at such date equal to or in excess of 10% of
the assets of the Borrower and the Subsidiaries at such date determined on a
consolidated basis in accordance with GAAP.
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<PAGE> 20
"Material Indebtedness" means Indebtedness (other than the Loans), or
obligations in respect of one or more Hedging Agreements, of any one or more of
the Borrower and the Subsidiaries in an aggregate principal amount exceeding
$15,000,000. For purposes of determining Material Indebtedness, the "principal
amount" of the obligations of the Borrower or any Subsidiary in respect of any
Hedging Agreement at any time shall be the maximum aggregate amount (giving
effect to any netting agreements) that the Borrower or such Subsidiary would be
required to pay if such Hedging Agreement were terminated at such time.
"Maturity Date" means the Termination Date or, as to any Revolving
Borrowing which shall be outstanding on such date, the first anniversary of the
Termination Date.
"Maximum Amount of Interest" has the meaning specified in Section 9.13.
"Moody's" means Moody's Investors Service, Inc.
"Multiemployer Plan" means a multiemployer plan as defined in Section
4001(a)(3) of ERISA.
"Note" means a Revolving Note or a Competitive Note.
"Other Taxes" means any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made hereunder or from the execution, delivery or enforcement
of, or otherwise with respect to, this Agreement.
"Participant" has the meaning specified in Section 9.04.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA and any successor entity performing similar functions.
"Permitted Encumbrances" means:
(a) Liens imposed by law for taxes that are not yet due or are being
contested in compliance with Section 5.04;
(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's,
landlords' and other like Liens imposed by law, arising in the ordinary course
of business and securing obligations that are not overdue by more than 60 days
or are being contested in compliance with Section 5.04;
(c) pledges and deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other social
security laws or regulations;
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<PAGE> 21
(d) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature, in each case in the ordinary course of
business;
(e) judgment liens in respect of judgments that do not constitute an
Event of Default under clause (k) of Article VII;
(f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary course
of business that do not secure any monetary obligations and do not materially
detract from the value of the affected property or interfere with the ordinary
conduct of business of the Borrower or any Subsidiary;
(g) Liens securing the obligations of the Borrower and any Subsidiary
hereunder or under any Loan Document or created pursuant to the terms of this
Agreement or any Loan Document; and
(h) rights of collecting banks having rights of setoff, revocation,
refund or chargeback with respect to money or instruments of the Borrower or the
Subsidiaries on deposit with or in the possession of such banks;
provided that, except as provided in clause (g), the term "Permitted
Encumbrances" shall not include any Lien securing Indebtedness.
"Permitted Investments" means the investments described on Schedule
1.01.
"Permitted Investors" means (a) Massachusetts Financial Services
Company, Putnam Investments, Inc., FMR Corp., (b) Max P. Watson, Jr., Richard P.
Gardner, Robert Beauchamp, William M. Austin. M. Brinkley Morse, John W. Barter,
B. Garland Cupp, Maldon K. Gafnar, L. W. Gray, George F. Raymond and Tom C.
Tinsley and (c) any member of the Family of, or any Family Trust created by, any
of the individuals named in clause (b) of this definition.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by the Administrative Agent as its prime rate in effect at its
principal office; each change in the
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<PAGE> 22
Prime Rate shall be effective from and including the date such change is
publicly announced as being effective.
"Register" has the meaning set forth in Section 9.04.
"Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"Required Lenders" means, at any time, Lenders having Revolving Loans
and unused Commitments representing at least 51% of the sum of the total
Revolving Loans and unused Commitments at such time; provided that, for purposes
of declaring the Loans to be due and payable pursuant to Article VII, and for
all purposes after the outstanding Loans, if any, become due and payable
pursuant to Article VII and the Commitments have expired or are terminated, the
outstanding Competitive Loans of the Lenders shall be included in their
respective Revolving Loans in determining the Required Lenders.
"Restricted Payment" means any dividend or other distribution (whether
in cash, securities or other property) with respect to any shares of any class
of capital stock of the Borrower or any Subsidiary, or any payment (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any such shares of capital stock of the Borrower
or any option, warrant or other right to acquire any such shares of capital
stock of the Borrower.
"Revolving Borrowing" means a Borrowing comprised of Revolving Loans of
the same Type, made, converted or continued on the same date and, in the case of
Eurodollar Loans, as to which single Interest Period is in effect.
"Revolving Credit Exposure" means, with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender's Revolving
Loans and its LC Exposure at such time.
"Revolving Loan" means a Loan made pursuant to Section 2.03.
"Revolving Note" means a promissory note of the Borrower payable to the
order of each Lender, in substantially the form of Exhibit 1.01-B, together with
all modifications, extensions, renewals and rearrangements thereof.
"S&P" means Standard & Poor's Ratings Services, a division of
McGraw-Hill, Inc.
"Sale-and-Leaseback Transaction" means a transaction or series of
transactions pursuant to which any Person shall sell or transfer to any other
Person any property, whether now owned or hereafter acquired, and, as part of
the same transaction or series of transactions, such first
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<PAGE> 23
Person or any of its Affiliates shall rent or lease as lessee (other than
pursuant to a Capital Lease), or similarly acquire the right to possession or
use of, such property or one or more properties for use for the same purpose or
purposes as such property.
"Stated Rate" has the meaning specified in Section 9.13.
"Statutory Reserve Rate" means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentage (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject with
respect to the Adjusted LIBO Rate, for eurocurrency fundings (currently referred
to as "Eurocurrency Liabilities" in Regulation D of the Board). Such reserve
percentages shall include those imposed pursuant to such Regulation D.
Eurodollar Loans shall be deemed to constitute eurocurrency fundings and to be
subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender
under such Regulation D or any comparable regulation. The Statutory Reserve Rate
shall be adjusted automatically on and as of the effective date of any change in
any reserve percentage.
"Subordination Agreement" has the meaning specified in Section 6.10(c).
"subsidiary" means, with respect to any Person (the "parent") at any
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power or, in the
case of a partnership, more than 50% of the general partnership interests are,
as of such date, owned, controlled or held, or (b) that is, as of such date,
otherwise Controlled, by the parent or one or more subsidiaries of the parent or
by the parent and one or more subsidiaries of the parent.
"Subsidiary" means any subsidiary of the Borrower.
"Subsidiary Guaranty" has the meaning specified in Section 6.10(b).
"Syndication Agent" has the meaning specified in the introduction to
this Agreement.
"Synthetic Lease Transaction" means a transaction involving a lease
designed to have the characteristics of a loan for federal income tax purposes
while obtaining operating lease treatment for financial accounting purposes.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
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"Termination Date" means April 11, 2000.
"Transactions" means the execution, delivery and performance by the
Borrower of this Agreement, the borrowing of Loans, the use of the proceeds
thereof and obtaining the issuance of Letters of Credit hereunder.
"Type", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate, the Alternate
Base Rate or, in the case of a Competitive Loan or Borrowing, the LIBO Rate or a
Fixed Rate.
"Utilization Fee" has the meaning specified in Section 2.12.
"Wholly-owned Subsidiary" means a Subsidiary all of the outstanding
shares of capital stock (or other equity interests), of every class, in which
are owned, directly or indirectly, by the Borrower.
"Withdrawal Liability" means liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Classification of Loans and Borrowings. For purposes of
this Agreement, Loans may be classified and referred to by Class (e.g., a
"Revolving Loan") or by Type (e.g., a "Eurodollar Loan") or by Class and Type
(e.g., a "Eurodollar Revolving Loan"). Borrowings also may be classified and
referred to by Class (e.g., a "Revolving Borrowing") or by Type (e.g., a
"Eurodollar Borrowing") or by Class and Type (e.g., a "Eurodollar Revolving
Borrowing").
SECTION 1.03. Terms Generally. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, to the extent permitted by the terms of this Agreement, (c) the words
"herein", "hereof" and "hereunder", and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular
provision hereof, (d) all references herein to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles and Sections of, and Exhibits
and Schedules to, this Agreement and (e) the words "asset" and "property" shall
be construed to have
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the same meaning and effect and to refer to any and all tangible and intangible
assets and properties, including cash, securities, accounts and contract rights.
SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the Execution Date in GAAP or in the application thereof
or the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have
been withdrawn or such provision amended in accordance herewith.
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments. Subject to the terms and conditions set
forth herein, each Lender agrees to make Revolving Loans to the Borrower from
time to time during the Availability Period in an aggregate principal amount
that will not result in (a) such Lender's Revolving Credit Exposure exceeding
such Lender's Commitment or (b) the sum of the total Revolving Credit Exposures
plus the aggregate principal amount of outstanding Competitive Loans exceeding
the total Commitments. Within the foregoing limits and subject to the terms and
conditions set forth herein, the Borrower may borrow, prepay and reborrow
Revolving Loans.
SECTION 2.02. Loans and Borrowings. (a) Each Revolving Loan shall be
made as part of a Borrowing consisting of Revolving Loans made by the Lenders
ratably in accordance with their respective Commitments. Each Competitive Loan
shall be made in accordance with the procedures set forth in Section 2.04. The
failure of any Lender to make any Loan required to be made by it shall not
relieve any other Lender of its obligations hereunder; provided that the
Commitments and Competitive Bids of the Lenders are several and no Lender shall
be responsible for any other Lender's failure to make Loans as required.
(b) Subject to Section 2.14, (i) each Revolving Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request
in accordance herewith, and (ii) each Competitive Borrowing shall be comprised
entirely of Eurodollar Loans or Fixed Rate Loans as the Borrower may request in
accordance herewith. Each Lender at its option may make any Eurodollar Loan by
causing any domestic or foreign branch or Affiliate of such Lender to make such
Loan; provided that any exercise of such option shall not affect the obligation
of the Borrower to repay such Loan in accordance with the terms of this
Agreement.
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(c) At the commencement of each Interest Period for any Eurodollar
Revolving Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of $1,000,000 and not less than $20,000,000. At the time that
each ABR Borrowing is made, such Borrowing shall be in an aggregate amount that
is an integral multiple of $1,000,000 and not less than $20,000,000; provided
that an ABR Borrowing may be in an aggregate amount that is equal to the entire
unused balance of the total Commitments or that is required to finance the
reimbursement of an LC Disbursement as contemplated by Section 2.06(e). Each
Competitive Borrowing shall be in an aggregate amount that is an integral
multiple of $1,000,000 and not less than $25,000,000. Borrowings of more than
one Type and Class may be outstanding at the same time; provided that there
shall not at any time be more than a total of seven Eurodollar Revolving
Borrowings outstanding.
(d) Notwithstanding any other provision of this Agreement, the Borrower
shall not be entitled to request any Borrowing if the Interest Period requested
with respect thereto would end after the Termination Date, or to elect to
convert or continue, any Borrowing if the Interest Period requested with respect
thereto would end after the Maturity Date.
SECTION 2.03. Requests for Revolving Borrowings. To request a Revolving
Borrowing, the Borrower shall notify the Administrative Agent of such request by
telephone (a) in the case of a Eurodollar Borrowing, not later than 11:00 a.m.,
Houston, Texas time, three Business Days before the date of the proposed
Borrowing or (b) in the case of an ABR Borrowing, not later than 10:30 a.m.,
Houston, Texas time, on the Business Day of the proposed Borrowing. Each such
telephonic Borrowing Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a written
Borrowing Request substantially in the form of Exhibit 2.03 (a "Borrowing
Request") and signed by the Borrower. Each such telephonic and written Borrowing
Request shall specify the following information in compliance with Section 2.02:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a Business Day;
(iii) whether such Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing;
(iv) in the case of a Eurodollar Borrowing, the initial Interest Period
to be applicable thereto, which shall be a period contemplated by the
definition of the term "Interest Period"; and
(v) the location and number of the Borrower's account to which funds
are to be disbursed, which shall comply with the requirements of Section
2.07.
If no election as to the Type of Revolving Borrowing is specified, then the
requested Revolving Borrowing shall be an ABR Borrowing. If no Interest Period
is specified with respect to any requested Eurodollar Revolving Borrowing, then
the Borrower shall be deemed to have selected an
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Interest Period of one month's duration. Promptly following receipt of a
Borrowing Request in accordance with this Section, the Administrative Agent
shall advise each Lender of the details thereof and of the amount of such
Lender's Loan to be made as part of the requested Borrowing.
SECTION 2.04. Competitive Bid Procedure. (a) Subject to the terms and
conditions set forth herein, from time to time during the Availability Period
the Borrower may request Competitive Bids and may (but shall not have any
obligation to) accept Competitive Bids and borrow Competitive Loans; provided
that the sum of the total Revolving Credit Exposures plus the aggregate
principal amount of outstanding Competitive Loans at any time shall not exceed
the total Commitments. To request Competitive Bids, the Borrower shall notify
the Agents of such request by telephone, in the case of a Eurodollar Borrowing,
not later than 9:00 a.m., Houston, Texas time, four Business Days before the
date of the proposed Borrowing and, in the case of a Fixed Rate Borrowing, not
later than 9:00 a.m., Houston, Texas time, one Business Day before the date of
the proposed Borrowing; provided that the Borrower may submit up to (but not
more than) three Competitive Bid Requests on the same day, but a Competitive Bid
Request shall not be made within five Business Days after the date of any
previous Competitive Bid Request, unless any and all such previous Competitive
Bid Requests shall have been withdrawn or all Competitive Bids received in
response thereto rejected. Each such telephonic Competitive Bid Request shall be
confirmed promptly by hand delivery or telecopy to the Agents of a written
Competitive Bid Request signed by the Borrower. Each such telephonic and written
Competitive Bid Request shall specify the following information in compliance
with Section 2.02:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a Business Day;
(iii) whether such Borrowing is to be a Eurodollar Borrowing or a Fixed
Rate Borrowing;
(iv) the Interest Period to be applicable to such Borrowing, which
shall be a period contemplated by the definition of the term "Interest
Period"; and
(v) the location and number of the Borrower's account to which funds
are to be disbursed, which shall comply with the requirements of Section
2.07.
Promptly following receipt of a Competitive Bid Request in accordance with this
Section, the Auction Administration Agent shall notify the Lenders of the
details thereof by telecopy (in substantially the form set forth in Exhibit
2.04-B), inviting the Lenders to submit Competitive Bids.
(b) Each Lender may (but shall not have any obligation to) make one or
more Competitive Bids to the Borrower in response to a Competitive Bid Request.
Each Competitive Bid by a Lender must be substantially the form of Exhibit
2.04-C and must be received by the Auction Administration Agent by telecopy, in
the case of a Eurodollar Competitive Borrowing, not later than
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9:00 a.m., Houston, Texas time, three Business Days before the proposed date of
such Competitive Borrowing, and in the case of a Fixed Rate Borrowing, not later
than 9:00 a.m., Houston, Texas time, on the proposed date of such Competitive
Borrowing. Competitive Bids that do not conform substantially to the form of
Exhibit 2.04-C may be rejected by the Auction Administration Agent, and the
Auction Administration Agent shall notify the applicable Lender as promptly as
practicable. Each Competitive Bid shall specify (i) the principal amount (which
shall be a minimum of $5,000,000 and an integral multiple of $1,000,000 and
which may equal the entire principal amount of the Competitive Borrowing
requested by the Borrower) of the Competitive Loan or Loans that the Lender is
willing to make, (ii) the Competitive Bid Rate or Rates at which the Lender is
prepared to make such Loan or Loans (expressed as a percentage rate per annum in
the form of a decimal to no more than four decimal places) and (iii) the
Interest Period applicable to each such Loan and the last day thereof.
(c) The Auction Administration Agent shall promptly notify the Borrower
by telecopy of the Competitive Bid Rate and the principal amount specified in
each Competitive Bid and the identity of the Lender that shall have made such
Competitive Bid.
(d) Subject only to the provisions of this paragraph, the Borrower may
accept or reject any Competitive Bid. The Borrower shall notify the Auction
Administration Agent by telephone, confirmed by telecopy in a form approved by
the Auction Administration Agent, whether and to what extent it has decided to
accept or reject each Competitive Bid, in the case of a Eurodollar Competitive
Borrowing, not later than 10:30 a.m., Houston, Texas time, three Business Days
before the date of the proposed Competitive Borrowing, and in the case of a
Fixed Rate Borrowing, not later than 10:30 a.m., Houston, Texas time, on the
proposed date of the Competitive Borrowing; provided that (i) the failure of the
Borrower to give such notice shall be deemed to be a rejection of each
Competitive Bid, (ii) the Borrower shall not accept a Competitive Bid made at a
particular Competitive Bid Rate if the Borrower rejects a Competitive Bid made
at a lower Competitive Bid Rate, (iii) the aggregate amount of the Competitive
Bids accepted by the Borrower shall not exceed the aggregate amount of the
requested Competitive Borrowing specified in the related Competitive Bid
Request, (iv) to the extent necessary to comply with clause (iii) above, the
Borrower may accept Competitive Bids at the same Competitive Bid Rate in part,
which acceptance, in the case of multiple Competitive Bids at such Competitive
Bid Rate, shall be made pro rata in accordance with the amount of each such
Competitive Bid, and (v) except pursuant to clause (iv) above, no Competitive
Bid shall be accepted for a Competitive Loan unless such Competitive Loan is in
a minimum principal amount of $5,000,000 and an integral multiple of $1,000,000;
provided further that if a Competitive Loan must be in an amount less than
$5,000,000 because of the provisions of clause (iv) above, such Competitive Loan
may be for a minimum of $1,000,000 or any integral multiple thereof, and in
calculating the pro rata allocation of acceptances of portions of multiple
Competitive Bids at a particular Competitive Bid Rate pursuant to clause (iv)
the amounts shall be rounded to integral multiples of $1,000,000 in a manner
determined by the Borrower. A notice given by the Borrower pursuant to this
paragraph shall be irrevocable.
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(e) The Auction Administration Agent shall promptly notify each bidding
Lender by telecopy whether or not its Competitive Bid has been accepted (and, if
so, the amount and Competitive Bid Rate so accepted), and each successful bidder
will thereupon become bound, subject to the terms and conditions hereof, to make
the Competitive Loan in respect of which its Competitive Bid has been accepted.
After completing the notifications referred to in the immediately preceding
sentence, the Auction Administration Agent shall (i) notify the Administrative
Agent of each Competitive Bid that has been accepted, the amount thereof and the
Competitive Bid Rate therefor and (ii) notify each Lender of the aggregate
principal amount of all Competitive Bids accepted.
(f) Upon determination by the Administrative Agent of the LIBO Rate
applicable to any Eurodollar Competitive Loan to be made by any Lender pursuant
to a Competitive Bid that has been accepted by a Borrower pursuant to Section
2.04(d), the Auction Administration Agent shall notify such Lender of (i) the
applicable LIBO Rate and (ii) the sum of the applicable LIBO Rate plus the
Margin bid by such Lender.
(g) If the Auction Administration Agent or any of its Affiliates shall
at any time have a Commitment hereunder and shall elect to submit a Competitive
Bid in its capacity as a Lender, it shall submit such Competitive Bid directly
to the Borrower at least one quarter of an hour earlier than the time by which
the other Lenders are required to submit their Competitive Bids to the Auction
Administration Agent pursuant to paragraph (b) of this Section.
SECTION 2.05. INTENTIONALLY OMITTED.
SECTION 2.06. Letters of Credit. (a) General. Subject to the terms and
conditions set forth herein, the Borrower may request the issuance of Letters of
Credit for its own account, in a form reasonably acceptable to the
Administrative Agent and the Issuing Bank, at any time and from time to time
during the Availability Period. In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any form
of letter of credit application or other agreement submitted by the Borrower to,
or entered into by the Borrower with, the Issuing Bank relating to any Letter of
Credit, the terms and conditions of this Agreement shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. To request the issuance of a Letter of Credit (or the amendment,
renewal or extension of an outstanding Letter of Credit), the Borrower shall
hand deliver or telecopy (or transmit by electronic communication, if
arrangements for doing so have been approved by the Issuing Bank) to the Issuing
Bank and the Administrative Agent (reasonably in advance of the requested date
of issuance, amendment, renewal or extension) a notice requesting the issuance
of a Letter of Credit, or identifying the Letter of Credit to be amended,
renewed or extended, and specifying the date of issuance, amendment, renewal or
extension (which shall be a Business Day), the date on which such Letter of
Credit is to expire (which shall comply with paragraph (c) of this Section), the
amount of such Letter of Credit, the name and address of the beneficiary thereof
and such other information as
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shall be necessary to prepare, amend, renew or extend such Letter of Credit. If
requested by the Issuing Bank, the Borrower also shall submit a letter of credit
application on the Issuing Bank's standard form in connection with any request
for a Letter of Credit. A Letter of Credit shall be issued, amended, renewed or
extended only if (and upon issuance, amendment, renewal or extension of each
Letter of Credit the Borrower shall be deemed to represent and warrant that),
after giving effect to such issuance, amendment, renewal or extension (i) the LC
Exposure shall not exceed $25,000,000 and (ii) the sum of the total Revolving
Credit Exposures plus the aggregate principal amount of outstanding Competitive
Loans shall not exceed the total Commitments.
(c) Expiration Date. Each Letter of Credit shall expire at or prior to
the close of business on the date that is five Business Days prior to the
Termination Date.
(d) Participations. By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of the Issuing Bank or the Lenders, the Issuing Bank
hereby grants to each Lender, and each Lender hereby acquires from the Issuing
Bank, a participation in such Letter of Credit equal to such Lender's Applicable
Percentage of the aggregate amount available to be drawn under such Letter of
Credit. In consideration and in furtherance of the foregoing, each Lender hereby
absolutely and unconditionally agrees to pay to the Administrative Agent, for
the account of the Issuing Bank, such Lender's Applicable Percentage of each LC
Disbursement made by the Issuing Bank and not reimbursed by the Borrower on the
date due as provided in paragraph (e) of this Section, or of any reimbursement
payment required to be refunded to the Borrower for any reason. Each Lender
acknowledges and agrees that its obligation to acquire participations pursuant
to this paragraph in respect of Letters of Credit is absolute and unconditional
and shall not be affected by any circumstance whatsoever, including any
amendment, renewal or extension of any Letter of Credit or the occurrence and
continuance of a Default or reduction or termination of the Commitments, and
that each such payment shall be made without any offset, abatement, withholding
or reduction whatsoever.
(e) Reimbursement. If the Issuing Bank shall make any LC Disbursement
in respect of a Letter of Credit, the Borrower shall reimburse such LC
Disbursement by paying to the Administrative Agent an amount equal to such LC
Disbursement not later than 12:00 noon, Houston, Texas time, on the date that
such LC Disbursement is made, if the Borrower shall have received notice of such
LC Disbursement prior to 10:00 a.m., Houston, Texas time, on such date, or, if
such notice has not been received by the Borrower prior to such time on such
date, then not later than 12:00 noon, Houston, Texas time, on (i) the Business
Day on which the Borrower receives such notice, if such notice is received prior
to 10:00 a.m., Houston, Texas time, on the day of receipt, or (ii) the Business
Day immediately following the day on which the Borrower receives such notice, if
such notice is not received prior to such time on the day of receipt; provided
that the Borrower may, subject to the conditions to borrowing set forth herein,
request in accordance with Section 2.03 that such payment be financed with an
ABR Borrowing in an equivalent amount and, to the extent so financed, the
Borrower's obligation to make such payment shall be discharged and replaced by
the resulting ABR Borrowing. If the Borrower fails to make such payment when
due, the
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Administrative Agent shall notify each Lender of the applicable LC Disbursement,
the payment then due from the Borrower in respect thereof and such Lender's
Applicable Percentage thereof. Promptly following receipt of such notice, each
Lender shall pay to the Administrative Agent its Applicable Percentage of the
payment then due from the Borrower, in the same manner as provided in Section
2.07 with respect to Loans made by such Lender (and Section 2.07 shall apply,
mutatis mutandis, to the payment obligations of the Lenders), and the
Administrative Agent shall promptly pay to the Issuing Bank the amounts so
received by it from the Lenders. Promptly following receipt by the
Administrative Agent of any payment from the Borrower pursuant to this
paragraph, the Administrative Agent shall distribute such payment to the Issuing
Bank or, to the extent that Lenders have made payments pursuant to this
paragraph to reimburse the Issuing Bank, then to such Lenders and the Issuing
Bank as their interests may appear. Any payment made by a Lender pursuant to
this paragraph to reimburse the Issuing Bank for any LC Disbursement (other than
the funding of ABR Loans as contemplated above) shall not constitute a Loan and
shall not relieve the Borrower of its obligation to reimburse such LC
Disbursement.
(f) Obligations Absolute. The Borrower's obligation to reimburse LC
Disbursements as provided in paragraph (e) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit or this Agreement, or any term or provision therein, (ii) any draft or
other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit, or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower's obligations hereunder. Neither
the Administrative Agent, the Auction Administration Agent, the Lenders nor the
Issuing Bank, nor any of their Related Parties, shall have any liability or
responsibility by reason of or in connection with the issuance or transfer of
any Letter of Credit or any payment or failure to make any payment thereunder
(irrespective of any of the circumstances referred to in the preceding
sentence), or any error, omission, interruption, loss or delay in transmission
or delivery of any draft, notice or other communication under or relating to any
Letter of Credit (including any document required to make a drawing thereunder),
any error in interpretation of technical terms or any consequence arising from
causes beyond the control of the Issuing Bank; provided that the foregoing shall
not be construed to excuse the Issuing Bank from liability to the Borrower to
the extent of any direct damages (as opposed to consequential damages, claims in
respect of which are hereby waived by the Borrower to the extent permitted by
applicable law) suffered by the Borrower that are caused by the Issuing Bank's
failure to exercise care when determining whether drafts and other documents
presented under a Letter of Credit comply with the terms thereof. The parties
hereto expressly agree that, in the absence of gross negligence, wilful
misconduct or unlawful acts on the part of the Issuing Bank (as finally
determined by a court of competent jurisdiction), the Issuing Bank shall be
deemed to have exercised care in each such determination. In furtherance of the
foregoing and without limiting the generality thereof, the parties
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agree that, with respect to documents presented which appear on their face to be
in substantial compliance with the terms of a Letter of Credit, the Issuing Bank
may, in its sole discretion, either accept and make payment upon such documents
without responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.
(g) Disbursement Procedures. The Issuing Bank shall, promptly following
its receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. The Issuing Bank shall promptly notify the
Administrative Agent and the Borrower by telephone (confirmed by telecopy) of
such demand for payment and whether the Issuing Bank has made or will make an LC
Disbursement thereunder; provided that any failure to give or delay in giving
such notice shall not relieve the Borrower of its obligation to reimburse the
Issuing Bank and the Lenders with respect to any such LC Disbursement.
(h) Interim Interest. If the Issuing Bank shall make any LC
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that the Borrower reimburses such LC
Disbursement, at the rate per annum then applicable to ABR Revolving Loans;
provided that, if the Borrower fails to reimburse such LC Disbursement when due
pursuant to paragraph (e) of this Section, then Section 2.13(d) shall apply.
Interest accrued pursuant to this paragraph shall be for the account of the
Issuing Bank, except that interest accrued on and after the date of payment by
any Lender pursuant to paragraph (e) of this Section to reimburse the Issuing
Bank shall be for the account of such Lender to the extent of such payment.
(i) Replacement of the Issuing Bank. The Issuing Bank may be replaced
at any time by written agreement among the Borrower, the Administrative Agent,
the replaced Issuing Bank and the successor Issuing Bank. The Administrative
Agent shall notify the Lenders of any such replacement of the Issuing Bank. At
the time any such replacement shall become effective, the Borrower shall pay all
unpaid fees accrued for the account of the replaced Issuing Bank pursuant to
Section 2.12(b). From and after the effective date of any such replacement, (i)
the successor Issuing Bank shall have all the rights and obligations of the
Issuing Bank under this Agreement with respect to Letters of Credit to be issued
thereafter and (ii) references herein to the term "Issuing Bank" shall be deemed
to refer to such successor or to any previous Issuing Bank, or to such successor
and all previous Issuing Banks, as the context shall require. After the
replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain
a party hereto and shall continue to have all the rights and obligations of an
Issuing Bank under this Agreement with respect to Letters of Credit issued by it
prior to such replacement, but shall not be required to issue additional Letters
of Credit.
(j) Cash Collateralization. If any Event of Default shall occur and be
continuing, on the Business Day that the Borrower receives notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, Lenders with LC Exposure
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representing greater than 50% of the total LC Exposure) demanding the deposit of
cash collateral pursuant to this paragraph, the Borrower shall deposit in an
account with the Administrative Agent, in the name of the Administrative Agent
and for the benefit of the Lenders, an amount in cash equal to the LC Exposure
as of such date plus any accrued and unpaid interest thereon; provided that the
obligation to deposit such cash collateral shall become effective immediately,
and such deposit shall become immediately due and payable, without demand or
other notice of any kind, upon the occurrence of any Event of Default with
respect to the Borrower described in clause (h) or (i) of Article VII. Such
deposit shall be held by the Administrative Agent as collateral for the payment
and performance of the obligations of the Borrower under this Agreement. The
Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account. Other than any interest earned
on the investment of such deposits, which investments shall be made at the
option and sole discretion of the Administrative Agent and at the Borrower's
risk and expense, such deposits shall not bear interest. Interest or profits, if
any, on such investments shall accumulate in such account. Moneys in such
account shall be applied by the Administrative Agent to reimburse the Issuing
Bank for LC Disbursements for which it has not been reimbursed and, to the
extent not so applied, shall be held for the satisfaction of the reimbursement
obligations of the Borrower for the LC Exposure at such time or, if the maturity
of the Loans has been accelerated (but subject to the consent of Lenders with LC
Exposure representing greater than 50% of the total LC Exposure), be applied to
satisfy other obligations of the Borrower under this Agreement. If the Borrower
is required to provide an amount of cash collateral hereunder as a result of the
occurrence of an Event of Default, such amount (to the extent not applied as
aforesaid) shall be returned to the Borrower within three Business Days after
all Events of Default have been cured or waived.
SECTION 2.07. Funding of Borrowings. (a) Each Lender shall make each
Loan to be made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds (i) in the case of a Eurodollar Borrowing, by 11:00
a.m., Houston, Texas time, and (ii) in the case of an ABR Borrowing, by 1:00
p.m., Houston, Texas time, in each cash, to the account of the Administrative
Agent most recently designated by it for such purpose by notice to the Lenders.
The Administrative Agent will make such Loans available to the Borrower by
promptly crediting the amounts so received, in like funds, to an account of the
Borrower maintained with the Administrative Agent in Houston, Texas and
designated by the Borrower in the applicable Borrowing Request or Competitive
Bid Request.
(b) Unless the Administrative Agent shall have received notice from a
Lender prior to the proposed date of any Borrowing that such Lender will not
make available to the Administrative Agent such Lender's Applicable Percentage
of such Borrowing, the Administrative Agent may assume that such Lender has made
its Applicable Percentage available on such date in accordance with paragraph
(a) of this Section and may, in reliance upon such assumption, make available to
the Borrower a corresponding amount. In such event, if a Lender has not in fact
made its Applicable Percentage of the applicable Borrowing available to the
Administrative Agent, then the applicable Lender and the Borrower severally
agree to pay to the Administrative Agent forthwith on demand such corresponding
amount with interest thereon, for each day from and including the
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date such amount is made available to the Borrower to but excluding the date of
payment to the Administrative Agent, at (i) in the case of such Lender, the
greater of the Federal Funds Effective Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation or (ii) in the case of the Borrower, the interest rate applicable
to ABR Loans. If such Lender pays such amount to the Administrative Agent, then
the Administrative Agent shall promptly notify the Borrower of such funding,
such amount shall constitute such Lender's Loan included in such Borrowing and
from and after the date of such funding, the interest rate applicable to such
amount shall be the interest rate applicable to such Borrowing.
SECTION 2.08. Interest Elections. (a) Subject to Section 2.14 each
Revolving Borrowing initially shall be of the Type specified in the applicable
Borrowing Request and, in the case of a Eurodollar Revolving Borrowing, shall
have an initial Interest Period as specified in such Borrowing Request.
Thereafter, subject to Section 2.14, the Borrower may elect to convert such
Borrowing to a different Type or to continue such Borrowing and, in the case of
a Eurodollar Revolving Borrowing, may elect Interest Periods therefor, all as
provided in this Section. The Borrower may elect different options with respect
to different portions of the affected Borrowing, in which case each such portion
shall be allocated ratably among the Lenders holding the Loans comprising such
Borrowing, and the Loans comprising each such portion shall be considered a
separate Borrowing. This Section shall not apply to Competitive Borrowings,
which may not be converted or continued.
(b) To make an election pursuant to this Section, the Borrower shall
notify the Administrative Agent of such election by telephone by the time that a
Borrowing Request would be required under Section 2.03 if the Borrower were
requesting a Revolving Borrowing of the Type resulting from such election to be
made on the effective date of such election. Each such telephonic Interest
Election Request shall be irrevocable and shall be confirmed promptly by hand
delivery or telecopy to the Administrative Agent of a written Interest Election
Request in a form approved by the Administrative Agent and signed by the
Borrower.
(c) Each telephonic and written Interest Election Request shall specify
the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies and,
if different options are being elected with respect to different portions
thereof, the portions thereof to be allocated to each resulting Borrowing
(in which case the information to be specified pursuant to clauses (iii)
and (iv) below shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such Interest
Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing; and
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(iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest
Period to be applicable thereto after giving effect to such election, which
shall be a period contemplated by the definition of the term "Interest
Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election Request
with respect to a Eurodollar Revolving Borrowing prior to the end of the
Interest Period applicable thereto, then, unless such Borrowing is repaid as
provided herein, at the end of such Interest Period such Borrowing shall be
converted to an ABR Borrowing. Notwithstanding any contrary provision hereof, if
an Event of Default has occurred and is continuing and the Administrative Agent,
at the request of the Required Lenders, so notifies the Borrower, then, so long
as such Event of Default is continuing (i) no outstanding Revolving Borrowing
may be converted to or continued as a Eurodollar Borrowing and (ii) unless
repaid, each Eurodollar Revolving Borrowing shall be converted to an ABR
Borrowing at the end of the Interest Period applicable thereto.
SECTION 2.09. Termination and Reduction of Commitments. (a) Unless
previously terminated, the Commitments shall terminate on the Termination Date.
(b) The Borrower may at any time terminate, or from time to time
reduce, the Commitments; provided that (i) each reduction of the Commitments
shall be in an amount that is an integral multiple of $1,000,000 and not less
than $25,000,000 and (ii) the Borrower shall not terminate or reduce the
Commitments if, after giving effect to any concurrent prepayment of the Loans in
accordance with Section 2.11, the sum of the Revolving Credit Exposures plus the
aggregate principal amount of outstanding Competitive Loans would exceed the
total Commitments.
(c) The Borrower shall notify the Administrative Agent of any election
to terminate or reduce the Commitments under paragraph (b) of this Section at
least three Business Days prior to the effective date of such termination or
reduction, specifying such election and the effective date thereof. Promptly
following receipt of any notice, the Administrative Agent shall advise the
Lenders of the contents thereof. Each notice delivered by the Borrower pursuant
to this Section shall be irrevocable; provided that a notice of termination of
the Commitments delivered by the Borrower may state that such notice is
conditioned upon the effectiveness of other credit facilities, in which case
such notice may be revoked by the Borrower (by notice to the Administrative
Agent on or prior to the specified effective date) if such condition is not
satisfied. Any termination or reduction of the Commitments shall be permanent.
Each reduction of the Commitments shall be made ratably among the Lenders in
accordance with their respective Commitments.
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(d) The Commitment shall automatically terminate on the date a Change
in Control occurs.
SECTION 2.10. Repayment of Loans; Evidence of Debt. (a) The Borrower
hereby unconditionally promises to pay (i) to the Administrative Agent for the
account of each Lender the then unpaid principal amount of each Revolving Loan
on the Maturity Date and (ii) to the Administrative Agent for the account of
each Lender having a Competitive Loan outstanding the then unpaid principal
amount of each Competitive Loan on the last day of the Interest Period
applicable to such Loan.
(b) Each Lender shall, and is hereby authorized by the Borrower to,
endorse on the schedule attached to the applicable Note of the Borrower held by
such Lender (or on a continuation of such schedule attached to each such Note
and made a part thereof) or in its internal records relating to such Note an
appropriate notation evidencing the date and amount of each Competitive Loan or
Revolving Loan of such Lender to the Borrower, each payment or prepayment of
principal of any Competitive Loan or Revolving Loan and the other information
provided for on such schedule.
(c) The Administrative Agent shall maintain accounts in which it shall
record (i) the amount of each Loan made hereunder, the Class and Type thereof
and the Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder for the account of the Lenders and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to paragraph
(b) or (c) of this Section shall be prima facie evidence of the existence and
amounts of the obligations recorded therein; provided that the failure of any
Lender or the Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of the Borrower to repay
the Loans in accordance with the terms of this Agreement.
SECTION 2.11. Prepayment of Loans. (a) The Borrower shall have the
right at any time and from time to time to prepay any Borrowing in whole or in
part, subject to prior notice in accordance with paragraph (b) of this Section;
provided that the Borrower shall not have the right to prepay any Competitive
Loan without the prior consent of the Lender thereof.
(b) The Borrower shall notify the Administrative Agent by telephone
(confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Revolving Borrowing, not later than 11:00 a.m.,
Houston, Texas time, three Business Days before the date of prepayment, or (ii)
in the case of prepayment of an ABR Borrowing, not later than 9:00 a.m.,
Houston, Texas time, one Business Day before the date of prepayment. Each such
notice shall be irrevocable and shall specify the prepayment date and the
principal amount of each Borrowing or portion thereof to be prepaid; provided
that, if a notice of prepayment is given in connection with a conditional notice
of termination of the Commitments as contemplated by Section 2.09, then such
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notice of prepayment may be revoked if such notice of termination is revoked in
accordance with Section 2.09. Promptly following receipt of any such notice
relating to a Revolving Borrowing, the Administrative Agent shall advise the
Lenders of the contents thereof. Each partial prepayment of any Revolving
Borrowing shall be in an amount that would be permitted in the case of an
advance of a Revolving Borrowing of the same Type as provided in Section 2.02.
Each prepayment of a Revolving Borrowing shall be applied ratably to the Loans
included in the prepaid Borrowing. Prepayments shall be accompanied by accrued
interest to the extent required by Section 2.13.
(c) On the date that a Change in Control occurs, the Borrower shall
repay the outstanding principal amount of the Loans and all other amounts
outstanding hereunder and under the other Loan Documents.
SECTION 2.12. Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a facility fee (the
"Facility Fee"), which shall accrue at the Applicable Margin on the daily amount
of the Commitment of such Lender (whether used or unused) during the period from
and including the Execution Date to but excluding the date on which such
Commitment terminates; provided that, if such Lender continues to have any
outstanding Revolving Loans after its Commitment terminates, then the Facility
Fee shall continue to accrue on the daily amount of such Lender's Revolving
Loans from and including the date on which its Commitment terminates to but
excluding the date on which such Lender ceases to have any outstanding Revolving
Loans. Accrued Facility Fees shall be payable in arrears on the last day of
June, September, December and March of each year and on the date on which the
Commitments terminate, (or, if Loans are outstanding on the Termination Date,
the Maturity Date) commencing on the first such date to occur after the
Execution Date; provided that any Facility Fees accruing after the date on which
the Commitments terminate (or, if Loans are outstanding on the Termination Date,
the Maturity Date) shall be payable on demand. All Facility Fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).
(b) From and after the first date on which any Index Debt shall be
rated by both Moody's and S&P (and whether or not any Index Debt continues to be
rated by both Moody's and S&P) to but excluding the date the Revolving Loans are
paid in full (the "Calculation Period"), the Borrower agrees to pay to the
Administrative Agent for the account of each Lender a utilization fee (the
"Utilization Fee"), which shall accrue at a rate per annum equal to .125% on
each Lender's Commitment (whether used or unused) for each day during the
Calculation Period on which the outstanding Revolving Loans of such Lender
exceed 50% of such Lender's Commitment or, on and after the Termination Date, if
such Revolving Loans of such Lender exceed 50% of such Lender's Commitment on
the day immediately preceding the Termination Date. All Utilization Fees shall
be payable in arrears on the last day of June, September, December and March
during the Calculation Period and on the date the Revolving Loans of such Lender
are paid in full, commencing on the first of such dates to occur during the
Calculation Period. All Utilization Fees shall be computed on the basis of a
year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).
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(c) The Borrower agrees to pay (i) to the Administrative Agent for the
account of each Lender a participation fee with respect to its participations in
Letters of Credit, which shall accrue at a rate per annum equal to the
Applicable Margin for Eurodollar Revolving Loans on the average daily amount of
such Lender's LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date on which such Lender's
Commitment terminates and the date on which such Lender ceases to have any LC
Exposure, and (ii) to the Issuing Bank a fronting fee, which shall accrue at the
rate of .125% per annum on the average daily amount of the LC Exposure
(excluding any portion thereof attributable to unreimbursed LC Disbursements)
during the period from and including the Effective Date to but excluding the
later of the date of termination of the Commitments and the date on which there
ceases to be any LC Exposure. Participation fees and fronting fees accrued
through and including the last day of June, September, December and March of
each year shall be payable on the third Business Day following such last day,
commencing on the first such date to occur after the Effective Date; provided
that all such fees shall be payable on the date on which the Commitments
terminate and any such fees accruing after the date on which the Commitments
terminate shall be payable on demand. Any other fees payable to the Issuing Bank
pursuant to this paragraph shall be payable within 10 days after demand. All
participation fees and fronting fees shall be computed on the basis of a year of
360 days and shall be payable for the actual number of days elapsed (including
the first day but excluding the last day).
(d) The Borrower agrees to pay all amounts due pursuant to the
Administrative Agent's Letter and the Auction Administration Agent's Letter.
(e) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent (or to the Issuing
Bank, in the case of fees payable to it) for distribution, in the case of
Facility Fees , Utilization Fees and participation fees to the Lenders. Fees
paid shall not be refundable under any circumstances.
(f) Notwithstanding the foregoing, in no event shall any Lender be
permitted to receive any compensation hereunder constituting interest in excess
of the Highest Lawful Rate.
SECTION 2.13. Interest. (a) The Loans comprising each ABR Borrowing
shall bear interest at the lesser of Alternate Base Rate and the Highest Lawful
Rate.
(b) The Loans comprising each Eurodollar Borrowing shall bear interest
(i) in the case of a Eurodollar Revolving Loan, at the lesser of (A) the
Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Margin and (B) the Highest Lawful Rate, or (ii) in the case of a
Eurodollar Competitive Loan, at the lesser of (A) the LIBO Rate for the Interest
Period in effect for such Borrowing plus (or minus, as applicable) the Margin
applicable to such Loan and (B) the Highest Lawful Rate.
(c) Each Fixed Rate Loan shall bear interest at the lesser of the Fixed
Rate applicable to such Loan and the Highest Lawful Rate.
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(d) Notwithstanding the foregoing, if any principal of or interest on
any Loan or any fee or other amount payable by the Borrower hereunder is not
paid when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any Loan, the lesser
of 2% plus the rate otherwise applicable to such Loan as provided in the
preceding paragraphs of this Section and the Highest Lawful Rate or (ii) in the
case of any other amount, the lesser of 2% plus the rate applicable to ABR Loans
as provided in paragraph (a) of this Section and the Highest Lawful Rate.
(e) Accrued interest on each Loan shall be payable in arrears on each
Interest Payment Date for such Loan and, in the case of Revolving Loans, upon
termination of the Commitments; provided that (i) interest accrued pursuant to
paragraph (d) of this Section shall be payable on demand, (ii) in the event of
any repayment or prepayment of any Loan (other than a prepayment of an ABR Loan
prior to the end of the Availability Period), accrued interest on the principal
amount repaid or prepaid shall be payable on the date of such repayment or
prepayment and (iii) in the event of any conversion of any Eurodollar Revolving
Loan prior to the end of the current Interest Period therefor, accrued interest
on such Loan shall be payable on the effective date of such conversion.
(f) All interest hereunder shall be computed on the basis of a year of
360 days (unless such computation would result in interest in excess of the
Highest Lawful Rate in which event such computation shall be made on the basis
of a year of 365 days, or 366 days in a leap year), except that interest
computed by reference to the Alternate Base Rate at times when the Alternate
Base Rate is based on the Prime Rate shall be computed on the basis of a year of
365 days (or 366 days in a leap year), and in each case shall be payable for the
actual number of days elapsed (including the first day but excluding the last
day). The applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall
be determined by the Administrative Agent, and such determination shall be
conclusive absent manifest error.
SECTION 2.14. Alternate Rate of Interest. If prior to the commencement
of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination shall be
conclusive absent manifest error) that adequate and reasonable means do not
exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable,
for such Interest Period; or
(b) the Administrative Agent is advised by the Required Lenders (or, in
the case of a Eurodollar Competitive Loan, by the Lender that is required to
make such Loan) that the Adjusted LIBO Rate or the LIBO Rate, as applicable, for
such Interest Period will not adequately and fairly reflect the cost to such
Lenders (or Lender) of making or maintaining their Loans (or its Loan) included
in such Borrowing for such Interest Period;
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then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Revolving Borrowing to, or
continuation of any Revolving Borrowing as, a Eurodollar Borrowing shall be
ineffective, (ii) if any Borrowing Request requests a Eurodollar Revolving
Borrowing, such Borrowing shall be made as an ABR Borrowing and (iii) any
request by the Borrower for a Eurodollar Competitive Borrowing shall be
ineffective; provided that (A) if the circumstances giving rise to such notice
do not affect all the Lenders, then requests by the Borrower for Eurodollar
Competitive Borrowings may be made to Lenders that are not affected thereby and
(B) if the circumstances giving rise to such notice affect only one Type of
Borrowings, then the other Type of Borrowings shall be permitted.
SECTION 2.15. Increased Costs. (a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit or
similar requirement against assets of, deposits with or for the account of,
or credit extended by, any Lender (except any such reserve requirement
reflected in the Adjusted LIBO Rate) or the Issuing Bank; or
(ii) impose on any Lender (directly or by its effect upon) the London
interbank market any other condition affecting this Agreement or Eurodollar
Loans or Fixed Rate Loans made by such Lender or any Letter of Credit or
participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan or Fixed Rate Loan (or of
maintaining its obligation to make any such Loan) or to increase the cost to
such Lender or the Issuing Bank of participating in, issuing or maintaining any
Letter of Credit or to reduce the amount of any sum received or receivable by
such Lender or the Issuing Bank hereunder (whether of principal, interest or
otherwise), then the Borrower will pay to such Lender or the Issuing Bank such
additional amount or amounts as will compensate such Lender or the Issuing Bank
for such additional costs incurred or reduction suffered.
(b) If any Lender or the Issuing Bank determines that any Change in Law
regarding capital requirements has or would have the effect of reducing the rate
of return on such Lender's or the Issuing Bank's capital or on the capital of
such Lender's or the Issuing Bank's holding company, if any, as a consequence of
this Agreement or the Loans made by, or participations in Letters of Credit held
by, such Lender, or the Letters of Credit issued by the Issuing Bank, such
Lender, to a level below that which such Lender or the Issuing Bank or such
Lender's or the Issuing Bank's holding company could have achieved but for such
Change in Law (taking into consideration such Lender's or the Issuing Bank's
policies and the policies of such Lender's or the Issuing Bank's holding company
with respect to capital adequacy), then from time to time the Borrower will pay
to such Lender or the Issuing Bank, as the case may be, such additional amount
or amounts as will compensate such Lender or such Lender's or the Issuing Bank's
holding company for any such reduction suffered.
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(c) A certificate of a Lender or the Issuing Bank setting forth the
amount or amounts necessary to compensate such Lender or the Issuing Bank or its
holding company, as the case may be, as specified in paragraph (a) or (b) of
this Section shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender or the Issuing Bank the
amount shown as due on any such certificate within 10 days after receipt
thereof.
(d) Failure or delay on the part of any Lender or the Issuing Bank to
demand compensation pursuant to this Section shall not constitute a waiver of
such Lender's or the Issuing Bank's right to demand such compensation; provided
that the Borrower shall not be required to compensate a Lender pursuant to this
Section for any increased costs or reductions incurred more than 180 days prior
to the date that such Lender notifies the Borrower of the Change in Law giving
rise to such increased costs or reductions and of such Lender's or the Issuing
Bank's intention to claim compensation therefor; provided further that, if the
Change in Law giving rise to such increased costs or reductions is retroactive,
then the 180-day period referred to above shall be extended to include the
period of retroactive effect thereof.
(e) Notwithstanding the foregoing provisions of this Section, a Lender
shall not be entitled to compensation pursuant to this Section in respect of any
Competitive Loan if the Change in Law that would otherwise entitle it to such
compensation shall have been publicly announced prior to submission of the
Competitive Bid pursuant to which such Loan was made.
SECTION 2.16. Break Funding Payments. In the event of (a) the payment
of any principal of any Eurodollar Loan or Fixed Rate Loan other than on the
last day of an Interest Period applicable thereto (including as a result of an
Event of Default), (b) the conversion of any Eurodollar Loan other than on the
last day of the Interest Period applicable thereto, (c) the failure to borrow,
convert, continue or prepay any Revolving Loan on the date specified in any
notice delivered pursuant hereto (regardless of whether such notice may be
revoked under Section 2.11(b) and is revoked in accordance therewith), (d) the
failure to borrow any Competitive Loan after accepting the Competitive Bid to
make such Loan, or (e) the assignment of any Eurodollar Loan or Fixed Rate Loan
other than on the last day of the Interest Period applicable thereto as a result
of a request by the Borrower pursuant to Section 2.19, then, in any such event,
the Borrower shall compensate each Lender for the loss, cost and expense
attributable to such event. In the case of a Eurodollar Loan, such loss, cost or
expense to any Lender shall be deemed to include an amount determined by such
Lender to be the excess, if any, of (i) the amount of interest which would have
accrued on the principal amount of such Loan had such event not occurred, at the
Adjusted LIBO Rate that would have been applicable to such Loan, for the period
from the date of such event to the last day of the then current Interest Period
therefor (or, in the case of a failure to borrow, convert or continue, for the
period that would have been the Interest Period for such Loan), over (ii) the
amount of interest which would accrue on such principal amount for such period
at the interest rate which such Lender would bid were it to bid, at the
commencement of such period, for dollar deposits of a comparable amount and
period from other banks in the eurodollar market. A certificate of any Lender
setting forth any amount or amounts that such Lender is entitled to receive
pursuant to this Section shall be
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delivered to the Borrower and shall be conclusive absent manifest error. The
Borrower shall pay such Lender the amount shown as due on any such certificate
within 10 days after receipt thereof.
SECTION 2.17. Taxes. (a) Any and all payments by or on account of any
obligation of the Borrower hereunder shall be made free and clear of and without
deduction for any Indemnified Taxes including Other Taxes; provided that if the
Borrower shall be required to deduct any Indemnified Taxes including Other Taxes
from such payments, then (i) the sum payable shall be increased as necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, the
Auction Administration Agent, the Lender or the Issuing Bank, as the case may
be, receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and (iii) the
Borrower shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.
(b) In addition, to the extent not prohibited by applicable law, the
Borrower shall pay any Other Taxes to the relevant Governmental Authority in
accordance with applicable law.
(c) The Borrower shall indemnify each Agent, each Lender and the
Issuing Bank, within 10 days after written demand therefor, for the full amount
of any Indemnified Taxes including Other Taxes paid by such Agent, such Lender
or the Issuing Bank, as the case may be, on or with respect to any payment by or
on account of any obligation of the Borrower hereunder (including Indemnified
Taxes including Other Taxes imposed or asserted on or attributable to amounts
payable under this Section) and any penalties, interest and reasonable expenses
arising therefrom or with respect thereto, whether or not such Indemnified Taxes
including Other Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority. A certificate as to the amount of such payment
or liability delivered to the Borrower by a Lender or the Issuing Bank, or by
the Administrative Agent on its own behalf or on behalf of a Lender, the Issuing
Bank or the Auction Administration Agent, shall be conclusive absent manifest
error.
(d) As soon as practicable after any payment of Indemnified Taxes,
including Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.
(e) Each Lender represents that it is either (i) a corporation
organized under the laws of the United States of America or any state thereof or
(ii) it is entitled to complete exemption from United States withholding tax
imposed on or with respect to any payments, including fees, to be made to it
pursuant to this Agreement (A) under an applicable provision of a tax convention
to which the United States of America is a party or (B) because it is acting
through a branch, agency or office in the United States of America and any
payment to be received by it hereunder is effectively connected with a trade or
business in the United States of America. Each Foreign Lender represents that it
has previously furnished to the Borrower (with a copy to the Administrative
Agent)
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or agrees to provide to the Borrower (with a copy to the Administrative Agent)
on the Effective Date, or on the date which it becomes a party to this
Agreement, two accurate and complete original signed copies of either (1)
Internal Revenue Service Form 4224 (or successor form) certifying that all
payments to be made to it hereunder will be effectively connected to a United
States trade or business, (2) Internal Revenue Service Form 1001 (or successor
form) certifying that it is entitled to the benefit of a tax convention to which
the United States of America is a party which completely exempts from United
States withholding tax all payments to be made to it hereunder, or (3) such
properly completed and executed documentation prescribed by applicable law or
reasonably requested by the Borrower as will permit such payments to be made
without withholding; and each Lender further agrees to provide to the Borrower,
at the time or times prescribed by applicable law, such properly completed and
executed documentation prescribed by applicable law or reasonably requested by
the Borrower as will permit such payments to be made without withholding. If any
Lender determines that it is unable to submit any form or certificate that it is
obligated to submit pursuant to this Section 2.17(e), or that is required to
withdraw or cancel any such form or certificate previously submitted, it shall
promptly notify the Borrower (with copy to the Administrative Agent) of such
fact. In the event that (Y) any representation made by a Person under this
Section 2.17(e) is incorrect or (Z) any such Person fails to deliver any forms
required under this Section 2.17(e) upon its initially becoming a party
hereunder, the Borrower's obligation to indemnify it for Indemnified Taxes shall
be reduced to the amount that it would have been obligated to pay had such
representation been correct or such forms been provided.
SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs. (a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Section 2.15, 2.16 or 2.17, or
otherwise) prior to 12:00 noon, Houston, Texas time, on the date when due, in
immediately available funds, without set-off or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at 1111 Fannin,
Houston, Texas, except payments to be made directly to the Issuing Bank as
expressly provided herein and except that payments pursuant to Sections 2.15,
2.16, 2.17 and 9.03 shall be made directly to the Persons entitled thereto. The
Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof. Except as set forth in clause (i) of the proviso in definition
of "Interest Period", if any payment hereunder shall be due on a day that is not
a Business Day, the date for payment shall be extended to the next succeeding
Business Day, and, in the case of any payment accruing interest, interest
thereon shall be payable for the period of such extension. All payments
hereunder shall be made in dollars.
(b) If at any time insufficient funds are received by and available to
the Administrative Agent to pay fully all amounts of principal, unreimbursed LC
Disbursements, interest and fees then due hereunder, such funds shall be applied
(i) first, towards payment of interest and fees then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties, and (ii) second, towards payment of principal
and
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unreimbursed LC Disbursements then due hereunder, ratably among the parties
entitled thereto in accordance with the amounts of principal and unreimbursed LC
Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Revolving Loans or participations in LC Disbursements
resulting in such Lender receiving payment of a greater proportion of the
aggregate amount of its Revolving Loans and participations in LC Disbursements
and accrued interest thereon than the proportion received by any other Lender,
then the Lender receiving such greater proportion shall purchase (for cash at
face value) participations in the Revolving Loans and participations in LC
Disbursements of other Lenders to the extent necessary so that the benefit of
all such payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective
Revolving Loans and participations in LC Disbursements; provided that (i) if any
such participations are purchased and all or any portion of the payment giving
rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest, and
(ii) the provisions of this paragraph shall not be construed to apply to any
payment made by the Borrower pursuant to and in accordance with the express
terms of this Agreement or any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Loans or
participations in LC Disbursements to any assignee or participant, other than to
the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions
of this paragraph shall apply). The Borrower consents to the foregoing and
agrees, to the extent it may effectively do so under applicable law, that any
Lender acquiring a participation pursuant to the foregoing arrangements may
exercise against the Borrower rights of set-off and counterclaim with respect to
such participation as fully as if such Lender were a direct creditor of the
Borrower in the amount of such participation.
(d) Unless the Administrative Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders or the Issuing Bank hereunder that the
Borrower will not make such payment, the Administrative Agent may assume that
the Borrower has made such payment on such date in accordance herewith and may,
in reliance upon such assumption, distribute to the Lenders or the Issuing Bank,
as the case may be, the amount due. In such event, if the Borrower has not in
fact made such payment, then each of the Lenders or the Issuing Bank, as the
case may be, severally agrees to repay to the Administrative Agent forthwith on
demand the amount so distributed to such Lender or the Issuing Bank with
interest thereon, for each day from and including the date such amount is
distributed to it to but excluding the date of payment to the Administrative
Agent, at the greater of the Federal Funds Effective Rate and a rate determined
by the Administrative Agent in accordance with banking industry rules on
interbank compensation.
(e) If any Lender shall fail to make any payment required to be made by
it pursuant to Section 2.06(d) or (e), 2.07(b) or 2.18(d), then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received
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by the Administrative Agent for the account of such Lender to satisfy such
Lender's obligations under such Sections until all such unsatisfied obligations
are fully paid.
SECTION 2.19. Mitigation Obligations; Replacement of Lenders. (a) If
any Lender requests compensation under Section 2.15, or if the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.17, then such
Lender shall use reasonable efforts to designate a different Applicable Lending
Office for funding or booking its Loans hereunder or to assign its rights and
obligations hereunder to another of its offices, branches or Affiliates, if, in
the judgment of such Lender, such designation or assignment (i) would eliminate
or reduce amounts payable pursuant to Section 2.15 or 2.17, as the case may be,
in the future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.
(b) If any Lender requests compensation under Section 2.15, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.17,
or if any Lender defaults in its obligation to fund Loans hereunder, then the
Borrower may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement
(other than any outstanding Competitive Loans held by it) to an Eligible
Assignee that shall assume such obligations (which Eligible Assignee may be
another Lender, if a Lender accepts such assignment); provided that (i) the
Borrower shall have received the prior written consent of the Administrative
Agent (and, if a Commitment is being assigned, the Issuing Bank), which consent
shall not unreasonably be withheld, (ii) such Lender shall have received payment
of an amount equal to the outstanding principal of its Loans (other than
Competitive Loans) and participations in LC Disbursements, accrued interest
thereon, accrued fees and all other amounts payable to it hereunder, from the
assignee (to the extent of such outstanding principal and accrued interest and
fees) or the Borrower (in the case of all other amounts) and (iii) in the case
of any such assignment resulting from a claim for compensation under Section
2.15 or payments required to be made pursuant to Section 2.17, such assignment
will result in a reduction in such compensation or payments. A Lender shall not
be required to make any such assignment and delegation if, prior thereto, as a
result of a waiver by such Lender or otherwise, the circumstances entitling the
Borrower to require such assignment and delegation cease to apply.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
SECTION 3.01. Organization; Powers. Each of the Borrower and the
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.
SECTION 3.02. Authorization; Enforceability. The Transactions are
within the Borrower's corporate powers and have been duly authorized by all
necessary corporate and, if required, stockholder action. This Agreement and
each of the other Loan Documents to which it is a party has been duly executed
and delivered by the Borrower and constitutes a legal, valid and binding
obligation of the Borrower, enforceable in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors' rights generally and subject to general principles of
equity, regardless of whether considered in a proceeding in equity or at law.
SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions
(a) do not require any consent or approval of, registration or filing with, or
any other action by, any Governmental Authority, except such as have been
obtained or made and are in full force and effect, (b) will not violate any
applicable law or regulation or the charter, by-laws or other organizational
documents of the Borrower or any of the Subsidiaries or any order of any
Governmental Authority, (c) will not violate or result in a default under any
indenture or other material agreement or instrument binding upon the Borrower or
any of the Subsidiaries or its assets, or give rise to a right thereunder to
require any payment to be made by the Borrower or any of the Subsidiaries, and
(d) will not result in the creation or imposition of any Lien on any asset of
the Borrower or any of the Subsidiaries.
SECTION 3.04. Financial Condition; No Material Adverse Change. (a) The
Borrower has heretofore furnished to the Lenders its consolidated balance sheets
and statements of income, stockholders' equity and cash flows (i) as of and for
the fiscal years ended March 31, 1997 and 1998, reported on by Arthur Andersen
LLP, independent public accountants, and (ii) as of and for the fiscal quarter
and that portion of the fiscal year ended December 31, 1998, certified by its
chief financial officer. The Borrower has also furnished to the Lenders the
consolidated balance sheets, statements of income, stockholders' equity and cash
flows for each of (i) New Dimension Software, Ltd. as of and for the fiscal
years ended December 31, 1997 and 1998, reported on by Somekn Chaikin (member of
KPMG International), independent public accountants, and (ii) Boole & Babbage,
Inc., (A) as of and for the fiscal years ended September 30, 1997 and 1998
reported on by PriceWaterhouse Coopers LLC and (B) as of and for the fiscal
quarter and that portion of the fiscal year ended December 31, 1998. Such
financial statements present fairly, in all material respects, the financial
position and results of operations and cash flows of the Borrower and the
consolidated Subsidiaries, and to the best knowledge of the Borrower, New
Dimension Software, Ltd., or Boole & Babbage, Inc., as the case may be, as of
such dates and for such periods in accordance with GAAP, subject to year-end
audit adjustments and the absence of footnotes in the
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case of the statements referred to in clause (ii) of the first and second
sentences of this Section 3.04(a) above.
(b) Since December 31, 1998, there has been no material adverse change
in the business, assets, operations, prospects or condition, financial or
otherwise, of the Borrower and the Subsidiaries, taken as a whole.
SECTION 3.05. Properties. (a) Each of the Borrower and the Subsidiaries
has good title to, or valid leasehold interests in, all its real and personal
property material to its business, except for minor defects in title that do not
interfere with its ability to conduct its business as currently conducted or to
utilize such properties for their intended purposes.
(b) Each of the Borrower and the Subsidiaries owns, or is licensed to
use, all trademarks, tradenames, copyrights, patents and other intellectual
property material to its business, and the use thereof by the Borrower and the
Subsidiaries does not infringe upon the rights of any other Person, except for
any such infringements that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 3.06. Litigation and Environmental Matters. (a) There are no
actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of the Borrower, threatened
against or affecting the Borrower or any of the Subsidiaries (i) as to which
there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect (other than the Disclosed
Matters) or (ii) that involve this Agreement or the Transactions.
(b) Except for the Disclosed Matters and except with respect to any
other matters that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, neither the Borrower nor any
Subsidiary (i) has failed to comply with any Environmental Law or to obtain,
maintain or comply with any permit, license or other approval required under any
Environmental Law, (ii) has become subject to any Environmental Liability, (iii)
has received notice of any claim with respect to any Environmental Liability or
(iv) knows of any basis for any Environmental Liability.
(c) Since the Execution Date, there has been no change in the status of
the Disclosed Matters that, individually or in the aggregate, has resulted in,
or materially increased the likelihood of, a Material Adverse Effect.
SECTION 3.07. Compliance with Laws and Agreements. The Borrower and
each Subsidiary is in compliance with all laws, regulations and orders of any
Governmental Authority applicable to it or its property and all indentures,
agreements and other instruments binding upon it or its property, except where
the failure to do so, individually or in the aggregate, could not
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reasonably be expected to result in a Material Adverse Effect. No Default or
Event of Default has occurred and is continuing.
SECTION 3.08. Investment and Holding Company Status. Neither the
Borrower nor any Subsidiary is (a) an "investment company" as defined in, or
subject to regulation under, the Investment Company Act of 1940, as amended, or
(b) a "holding company" as defined in, or subject to regulation under, the
Public Utility Holding Company Act of 1935, as amended.
SECTION 3.09. Taxes. The Borrower and each Subsidiary has timely filed
or caused to be filed all tax returns and reports required to have been filed
and has paid or caused to be paid all Taxes required to have been paid by it,
except (a) Taxes that are being contested in good faith by appropriate
proceedings and for which the Borrower or such Subsidiary, as applicable, has
set aside on its books adequate reserves or (b) to the extent that the failure
to do so could not reasonably be expected to result in a Material Adverse
Effect.
SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events for
which liability is reasonably expected to occur, could reasonably be expected to
result in a Material Adverse Effect. The present value of all accumulated
benefit obligations under each Plan (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) did not, as of the date
of the most recent financial statements reflecting such amounts, exceed by more
than $15,000,000 the fair market value of the assets of such Plan, and the
present value of all accumulated benefit obligations of all underfunded Plans
(based on the assumptions used for purposes of Statement of Financial Accounting
Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed by more than $15,000,000 the fair
market value of the assets of all such underfunded Plans.
SECTION 3.11. Disclosure. The Borrower has disclosed to the Lenders all
agreements, instruments and corporate or other restrictions to which it or any
of the Subsidiaries is subject, and all other matters known to it, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect. Neither this Article III nor the Information Memorandum
nor any of the other reports, financial statements, certificates or other
information furnished by or on behalf of the Borrower to the Administrative
Agent or any Lender in connection with the negotiation of this Agreement or
delivered hereunder (as modified or supplemented by other information so
furnished) contains any material misstatement of fact or omits to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that, with
respect to projected financial information, the Borrower represents only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time.
SECTION 3.12. Year 2000. Any reprogramming required to permit the
proper functioning, in and following the year 2000, of (i) the Borrower's
computer systems and (ii) equipment containing embedded microchips (including
systems and equipment supplied by
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others or with which the Borrower's systems interface) and the testing of all
such systems and equipment, as so reprogrammed, will be completed by September
30, 1999. The cost to the Borrower of such reprogramming and testing and of the
reasonably foreseeable consequences of year 2000 to the Borrower (including
reprogramming errors and the failure of others' systems or equipment) is not
reasonably expected to result in a Default, an Event of Default or a Material
Adverse Effect. Except for such of the reprogramming referred to in the
preceding sentence as may be necessary, the computer and management information
systems of the Borrower and the Subsidiaries are and, with ordinary course
upgrading and maintenance, will continue for the term of this Agreement to be,
sufficient to permit the Borrower to conduct its business without Material
Adverse Effect.
SECTION 3.13. Margin Stock. "Margin Stock" (as defined in Regulation U
of the Board) does not constitute, and the Borrower does not intend, contemplate
or foresee that so long as any Loan or Letter of Credit shall be outstanding or
any LC Disbursements shall not have been reimbursed, "margin stock" will
constitute more than 25% of the assets of the Borrower, alone, or of the
Borrower and the Subsidiaries on a consolidated basis.
ARTICLE IV
CONDITIONS
SECTION 4.01. Effective Date. The obligations of the Lenders to make
Loans and of the Issuing Bank to issue Letters of Credit hereunder shall not
become effective until the date on which each of the following conditions is
satisfied (or waived in accordance with Section 9.02):
(a) The Administrative Agent (or its counsel) shall have received from
each party hereto either (i) a counterpart of this Agreement signed on behalf of
such party or (ii) written evidence satisfactory to the Administrative Agent
(which may include telecopy transmission of a signed signature page of this
Agreement) that such party has signed a counterpart of this Agreement.
(b) The Administrative Agent shall have received (i) a Revolving Note
and a Competitive Note for each Lender executed by the Borrower and dated the
Execution Date and (ii) a Subordination Agreement dated as of the Execution Date
executed by Distribution.
(c) The Administrative Agent shall have received a favorable written
opinion (addressed to the Administrative Agent and the Lenders and dated the
Execution Date) of Vinson & Elkins L.L.P., special Texas counsel for the
Borrower and Distribution, in form and substance reasonably satisfactory to the
Administrative Agent, and covering such other matters relating to the Borrower,
the Subsidiaries, this Agreement or the Transactions as the Required Lenders
shall reasonably request. The Borrower hereby requests such counsel to deliver
such opinion.
(d) The Administrative Agent shall have received (i) copies of the
Certificate of Incorporation of each of the Borrower and Distribution, together
with all amendments, and a current
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certificate of good standing, both certified by the appropriate governmental
office, in its jurisdiction of organization; (ii) a certificate of the Secretary
or an Assistant Secretary of each of the Borrower and Distribution certifying,
inter alia, (A) true and complete copies of the bylaws of the Borrower or
Distribution, as the case may be, together with all amendments, (B) true and
complete copies of resolutions adopted by the Board of Directors of the Borrower
or Distribution, as the case may be, authorizing the Borrower or Distribution,
as the case may be, to borrow (in the case of the Borrower) and effect other
transactions hereunder and under the other Loan Documents to which it is a
party, and (C) the incumbency and specimen signatures of the Persons executing
any documents on behalf of the Borrower or Distribution; and (iii) such
documents and certificates as the Administrative Agent or its counsel may
reasonably request relating to the organization, existence and good standing of
the Borrower or Distribution, as the case may be, the authorization of the
Transactions and any other legal matters relating to the Borrower, the
Subsidiaries, this Agreement and the other Loan Documents or the Transactions,
all in form and substance reasonably satisfactory to the Administrative Agent
and its counsel.
(e) The Administrative Agent shall have received a certificate, dated
the Effective Date and signed by the President, a Vice President or a Financial
Officer of the Borrower, confirming compliance with the conditions set forth in
paragraphs (a) and (b) of Section 4.02.
(f) The Administrative Agent shall have received all fees and other
amounts due and payable on or prior to the Effective Date, including, to the
extent invoiced, reimbursement or payment of all out-of-pocket expenses
(including the fees and expenses of its counsel) required to be reimbursed or
paid by the Borrower hereunder.
The Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding. Notwithstanding
the foregoing, unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 9.02) and the Administrative Agent has received a Borrowing
Request at or prior to 3:00 p.m., Houston, Texas time on April 20, 1999, the
Commitments shall terminate at such time.
SECTION 4.02. Each Credit Event. The obligation of each Lender to make
a Loan on the occasion of any Borrowing, and of the Issuing Bank to issue,
amend, renew or extend any Letter of Credit is subject to the satisfaction of
the following conditions:
(a) The representations and warranties of the Borrower set forth in
this Agreement shall be true and correct on and as of the date of such Borrowing
or the date of issuance, amendment, renewal or extension of such Letter of
Credit, as applicable.
(b) At the time of and immediately after giving effect to such
Borrowing or the issuance, amendment, renewal or extension of a Letter of
Credit, no Default or Event of Default shall have occurred and be continuing.
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Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in paragraphs (a) and
(b) of this Section.
ARTICLE V
AFFIRMATIVE COVENANTS
Until the Commitments have expired or been terminated and the principal
of and interest on each Loan and all fees payable hereunder shall have been paid
in full and all Letters of Credit shall have expired or terminated and all LC
Disbursements shall have been reimbursed, the Borrower covenants and agrees with
the Lenders that:
SECTION 5.01. Financial Statements; Ratings Change and Other
Information. The Borrower will furnish to the Administrative Agent and each
Lender:
(a) within 90 days after the end of each fiscal year of the Borrower,
its audited consolidated balance sheet and related statements of operations,
stockholders' equity and cash flows as of the end of and for such year, setting
forth in each case in comparative form the figures for the previous fiscal year,
all reported on by Arthur Andersen LLP or other independent public accountants
of recognized national standing (without a "going concern" or like qualification
or exception and without any qualification or exception as to the scope of such
audit) to the effect that such consolidated financial statements present fairly
in all material respects the financial condition and results of operations of
the Borrower and the consolidated Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied;
(b) within 45 days after the end of each of the first three fiscal
quarters of each fiscal year of the Borrower, its consolidated balance sheet and
related consolidated statements of operations, stockholders' equity and cash
flows as of the end of and for such fiscal quarter and the then elapsed portion
of the fiscal year, setting forth in each case in comparative form the figures
for the corresponding period or periods of (or, in the case of the balance
sheet, as of the end of) the previous fiscal year, all certified by one of its
Financial Officers as presenting fairly in all material respects the financial
condition and results of operations of the Borrower and the consolidated
Subsidiaries on a consolidated basis in accordance with GAAP consistently
applied, subject to normal year-end audit adjustments and the absence of
footnotes;
(c) concurrently with any delivery of financial statements under clause
(a) or (b) above, a certificate of a Financial Officer of the Borrower (i)
certifying whether any Domestic Subsidiary is a Material Domestic Subsidiary,
(ii) certifying as to whether a Default or an Event of Default has occurred and,
if a Default or an Event of Default has occurred, specifying the details thereof
and any action taken or proposed to be taken with respect thereto, (iii)
demonstrating compliance with Sections 6.01 and 6.02(g) in the form of Schedule
5.01 and (iv) stating whether any change in GAAP or in the application thereof
has occurred since the date of the audited financial
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statements referred to in Section 3.04 and, if any such change has occurred,
specifying the effect of such change on the financial statements accompanying
such certificate;
(d) concurrently with any delivery of financial statements under clause
(a) above, a certificate of the accounting firm that reported on such financial
statements stating whether they obtained knowledge during the course of their
examination of such financial statements of any Default or any Event of Default
(which certificate may be limited to the extent required by accounting rules or
guidelines);
(e) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by the
Borrower or any Subsidiary with the Securities and Exchange Commission, or any
Governmental Authority succeeding to any or all of the functions of said
Commission, or with any national securities exchange, or distributed by the
Borrower to its shareholders generally, as the case may be;
(f) promptly after Moody's or S&P shall have announced a change in the
rating established or deemed to have been established for the Index Debt,
written notice of such rating change; and
(g) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of the
Borrower or any Subsidiary, or compliance with the terms of this Agreement, as
the Administrative Agent or any Lender may reasonably request.
SECTION 5.02. Notices of Material Events. The Borrower will furnish to
the Administrative Agent and each Lender prompt written notice of the following:
(a) the occurrence of any Default or Event of Default;
(b) the filing or commencement of any action, suit or proceeding by or
before any arbitrator or Governmental Authority against or affecting the
Borrower or any Affiliate thereof that, if determined adversely to the interest
of the Borrower or such Affiliate, could reasonably be expected to result in a
Material Adverse Effect;
(c) the occurrence of any ERISA Event that, alone or together with any
other ERISA Events that have occurred, could reasonably be expected to result in
liability of the Borrower and the Subsidiaries in an aggregate amount exceeding
$15,000,000; and
(d) any other development that results in, or could reasonably be
expected to result in, a Material Adverse Effect.
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Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.
SECTION 5.03. Existence; Conduct of Business. The Borrower will, and
will cause each of the Subsidiaries to, do or cause to be done all things
necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business; provided that the foregoing shall not prohibit
any merger, consolidation, liquidation or dissolution permitted under Section
6.03.
SECTION 5.04. Payment of Obligations. The Borrower will, and will cause
each of the Subsidiaries to, pay its obligations, including Tax liabilities,
that, if not paid, could result in a Material Adverse Effect before the same
shall become delinquent or in default, except where (a) the validity or amount
thereof is being contested in good faith by appropriate proceedings, (b) the
Borrower or such Subsidiary has set aside on its books adequate reserves with
respect thereto in accordance with GAAP and (c) the failure to make payment
pending such contest could not reasonably be expected to result in a Material
Adverse Effect.
SECTION 5.05. Maintenance of Properties; Insurance. The Borrower will,
and will cause each of the Subsidiaries to, (a) keep and maintain all property
material to the conduct of its business in good working order and condition,
ordinary wear and tear excepted, and (b) maintain, with financially sound and
reputable insurance companies, insurance in such amounts and against such risks
as are customarily maintained by companies engaged in the same or similar
businesses operating in the same or similar locations.
SECTION 5.06. Books and Records; Inspection Rights. The Borrower will,
and will cause each of the Subsidiaries to, keep proper books of record and
account in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities. The Borrower will, and
will cause each of the Subsidiaries to, permit any representatives designated by
the Administrative Agent or any Lender, upon reasonable prior notice, to visit
and inspect its properties, to examine and make extracts from its books and
records, and to discuss its affairs, finances and condition with its officers
and independent accountants, all at such reasonable times and as often as
reasonably requested; provided, however, that with respect to discussions with
the Borrower's independent accountants, the Borrower shall be given a reasonable
opportunity to have a representative present during such discussions. The
Borrower shall pay or reimburse the reasonable expenses of the inspections and
visitations made by the Administrative Agent and any Lender pursuant to this
Section 5.06, except that such expenses shall not be the responsibility of the
Borrower more than once per calendar year, unless a Default or an Event of
Default has occurred and is continuing at the time of the inspection and
visitation, in which case the Borrower shall pay or reimburse any of such
expenses reasonably incurred by such Administrative Agent or such Lender.
SECTION 5.07. Compliance with Laws. The Borrower will, and will cause
each of the Subsidiaries to, comply with all laws, rules, regulations and orders
of any Governmental
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Authority applicable to it or its property, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.
SECTION 5.08. Use of Proceeds. The proceeds of the Loans will be used
only for general corporate purposes of the Borrower and the Subsidiaries,
including acquisitions. No part of the proceeds of any Loan will be used,
whether directly or indirectly, for any purpose that entails a violation of any
of the Regulations of the Board, including Regulations U and X.
SECTION 5.09. Year 2000. The Borrower shall take all action necessary
to assure that its computer based systems and those of the Subsidiaries are able
to effectively process data including dates on and after January 1, 2000. At the
request of the Administrative Agent or any Lender (through the Administrative
Agent), the Borrower shall provide the Administrative Agent or such Lender, as
the case may be, with assurance reasonably acceptable to the Administrative
Agent, or such Lender, as the case may be, of the Borrower's Year 2000
capability.
ARTICLE VI
FINANCIAL AND NEGATIVE COVENANTS
Until the Commitments have expired or terminated and the principal of
and interest on each Loan and all fees payable hereunder have been paid in full
and all Letters of Credit have expired or terminated and all LC Disbursements
shall have been reimbursed, the Borrower covenants and agrees with the Lenders
that:
SECTION 6.01. Financial Covenants.
(a) The Borrower will not permit the ratio of (i) Consolidated
Indebtedness at the end of any fiscal quarter to (ii) Consolidated EBITDA for
such fiscal quarter and the three immediately preceding fiscal quarters to
exceed 2.5 to 1.0.
(b) The Borrower shall at all times maintain ownership of cash and
Permitted Investments in an amount not less than the sum of (i) $300,000,000,
plus (ii) the maximum aggregate amount of any Indebtedness or other obligations
secured by a Lien on any such cash or Permitted Investments (including any Lien
thereon) in favor of a "securities intermediary" (as defined in Section
8.104(14) of the Texas Business and Commerce Code).
SECTION 6.02. Liens. The Borrower will not, and will not permit any
Subsidiary to, create, incur, assume or permit to exist any Lien on any property
or asset now owned or hereafter acquired by it, or assign or sell any income or
revenues (including accounts receivable) or rights in respect of any thereof,
except:
(a) Permitted Encumbrances;
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(b) any Lien on any property or asset of the Borrower or any Subsidiary
existing on the Execution Date and set forth in Schedule 6.02; provided that (i)
such Lien shall not apply to any other property or asset of the Borrower or any
Subsidiary and (ii) such Lien shall secure only those obligations which it
secures on the Execution Date and extensions, renewals and replacements thereof
that do not increase the outstanding principal amount thereof;
(c) any Lien existing on any property or asset prior to the acquisition
thereof by the Borrower or any Subsidiary or existing on any property or asset
of any Person that becomes a Subsidiary after the Execution Date prior to the
time such Person becomes a Subsidiary; provided that (i) such Lien is not
created in contemplation of or in connection with such acquisition or such
Person becoming a Subsidiary, as the case may be, (ii) such Lien shall not apply
to any other property or assets of the Borrower or any Subsidiary and (iii) such
Lien shall secure only those obligations which it secures on the date of such
acquisition or the date such Person becomes a Subsidiary, as the case may be and
extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof;
(d) Liens on fixed or capital assets acquired, constructed or improved
by the Borrower or any Subsidiary; provided that (i) Liens and the Indebtedness
secured thereby are incurred prior to or within 90 days after such acquisition
or the completion of such construction or improvement, (ii) the Indebtedness
secured thereby does not exceed 90% of the cost of acquiring, constructing or
improving such fixed or capital assets and (iii) such Liens shall not apply to
any other property or assets of the Borrower or any Subsidiary;
(e) any Lien granted by a Subsidiary in favor of the Borrower or
another Subsidiary;
(f) any Lien existing in connection with any sale, securitization or
monetization of receivables or other rights to receive payment of the Borrower
and any of its Subsidiaries, so long as such sale, securitization or
monetization is treated as a sale pursuant to the Financial Accounting Standards
Board Statement No. 125;
(g) any Lien existing in connection with any sale, securitization or
monetization of receivables or other rights to receive payment of any Excluded
Domestic Subsidiary, whether or not such sale, securitization or monetization is
treated as a sale pursuant to Financial Accounting Standards Board Statement No.
125;
(h) to the extent deemed for any purpose a Lien on property of the
Borrower, the lease in a Sale-and-Leaseback Transactions entered into in
compliance with Section 6.04; and
(i) any Lien securing any Indebtedness in an amount which, together
with all other Indebtedness of the Borrower or any Subsidiary secured by a Lien
that is not otherwise permitted by the provisions of this Section 6.02 does not
at the time of the incurrence of the
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Indebtedness so secured exceed 5% of the Borrower's consolidated net tangible
assets as of the most recently ended fiscal quarter preceding the date on which
such Lien is created or assumed.
SECTION 6.03. Fundamental Changes. The Borrower will not, and will not
permit any Subsidiary to, merge into or consolidate with any other Person, or
permit any other Person to merge into or consolidate with it, or sell, transfer,
lease or otherwise dispose of (in one transaction or in a series of
transactions) all or any substantial part of its assets, or all or substantially
all of the stock of any of the Subsidiaries (in each case, whether now owned or
hereafter acquired), or liquidate or dissolve, except that, if at the time
thereof and immediately after giving effect thereto no Default or Event of
Default shall have occurred and be continuing (a) any Person may merge into the
Borrower in a transaction in which the Borrower is the surviving corporation,
(b) any Person may merge into any Subsidiary in a transaction in which the
surviving entity is a Subsidiary and in which the direct or indirect percentage
ownership by the Borrower of the equity of the surviving entity is not less than
the Borrower's percentage ownership of the non-surviving Subsidiary, (c) any
Subsidiary may sell, transfer, lease or otherwise dispose of its assets to the
Borrower or to another Subsidiary and (d) any Subsidiary may liquidate or
dissolve if the Borrower determines in good faith that such liquidation or
dissolution is in the best interests of the Borrower and is not materially
disadvantageous to the Lenders.
SECTION 6.04. Sale-and-Leaseback Transactions. The Borrower shall not
itself, and shall not permit any Subsidiary to, enter into any
Sale-and-Leaseback Transaction, except that the Borrower may enter into a
Sale-and-Leaseback Transaction if, after giving effect to the incurrence of the
Attributable Debt with respect thereto and the concurrent retirement of any
other Attributable Debt, the aggregate amount of all Attributable Debt
outstanding does not exceed an amount equal to 5% of the Borrower's consolidated
net tangible assets.
SECTION 6.05. Hedging Agreements. The Borrower will not, and will not
permit any Subsidiary to, enter into any Hedging Agreement, other than Hedging
Agreements entered into in the ordinary course of business to hedge or mitigate
risks to which the Borrower or any Subsidiary is exposed in the conduct of its
business or the management of its assets or liabilities.
SECTION 6.06. Restricted Payments. During the existence of any Event of
Default, the Borrower will not, and will not permit any Subsidiary to, declare
or make, or agree to pay or make, directly or indirectly, any dividend, except
(a) the Borrower may declare and pay dividends with respect to its capital stock
payable solely in additional shares of its common stock and (b) wholly-owned
Subsidiaries may declare and pay dividends with respect to their capital stock.
SECTION 6.07. Transactions with Affiliates. The Borrower will not, and
will not permit any Subsidiary to, sell, lease or otherwise transfer any
property or assets to, or purchase, lease or otherwise acquire any property or
assets from, or otherwise engage in any other transactions with, any of its
Affiliates, except (a) in the ordinary course of business at prices and on terms
and conditions not less favorable to the Borrower or such Subsidiary than could
be obtained on an
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arm's-length basis from unrelated third parties and (b) transactions between or
among the Borrower and the Subsidiaries not involving any other Affiliate.
SECTION 6.08. Restrictive Agreements. The Borrower will not, and will
not permit any Subsidiary to, directly or indirectly, enter into, incur or
permit to exist any agreement or other arrangement that prohibits, restricts or
imposes any condition upon (a) the ability of the Borrower or any Subsidiary to
create, incur or permit to exist any Lien upon any of its property or assets, or
(b) the ability of any Subsidiary to pay dividends or other distributions with
respect to any shares of its capital stock or to make or repay loans or advances
to the Borrower or any other Subsidiary, or (c) to Guarantee Indebtedness of the
Borrower or any Subsidiary; provided that (i) the foregoing shall not apply to
restrictions and conditions imposed by law or by this Agreement, (ii) the
foregoing shall not apply to restrictions and conditions existing on the
Execution Date identified on Schedule 6.08 (but shall apply to any extension or
renewal of, or any amendment or modification expanding the scope of, any such
restriction or condition), (iii) this Section 6.08 shall not apply to customary
restrictions and conditions contained in agreements relating to the sale of a
Subsidiary pending such sale, provided such restrictions and conditions apply
only to the Subsidiary that is to be sold and such sale is permitted hereunder,
(iv) clause (a) of the foregoing shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by this
Agreement if such restrictions or conditions apply only to the property or
assets securing such Indebtedness, (v) clause (a) of this Section 6.08 shall not
apply to customary provisions in leases and other contracts restricting the
assignment thereof, and (vi) clause (a) of this Section 6.08 shall not apply to
Excluded Domestic Subsidiaries.
SECTION 6.09. Line of Business. The Borrower will not, and will not
permit any Subsidiary to, engage to any substantial extent in any business other
than the businesses in which the Borrower and the Subsidiaries are engaged on
the Execution Date as described in the Information Memorandum and businesses
reasonably related thereto or in furtherance thereof.
SECTION 6.10. Subsidiaries. (a) The Borrower will not permit any
Subsidiary to Guarantee the Indebtedness of the Borrower or any other Subsidiary
other than the Indebtedness hereunder and under the Notes unless the Company
makes, or causes to be made, effective provision whereby the Indebtedness
hereunder and under the Notes are guaranteed by such guaranteeing Subsidiary on
a pari passu basis pursuant to an agreement and other documentation reasonably
satisfactory to the Administrative Agent.
(b) Not less than 30 days after the date that any Material Domestic
Subsidiary (other than an Excluded Domestic Subsidiary) incurs any Indebtedness
to any Person other than the Borrower or a Wholly-owned Subsidiary, the Borrower
shall cause such Material Domestic Subsidiary to execute and deliver to the
Administrative Agent, in sufficient copies for each Lender (i) a guaranty of all
of the Indebtedness and other obligations of the Borrower hereunder and under
the Notes (each such guaranty being a "Subsidiary Guaranty") pursuant to an
agreement reasonably satisfactory to the Administrative Agent, (ii) copies of
the Certificate or Articles of Incorporation and bylaws or other organization
document of such Material Domestic Subsidiary, a resolution of
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the board of directors (or similar governing body) of such Material Domestic
Subsidiary approving the form of the Subsidiary Guaranty and its execution,
delivery and performance, all certified as true and complete by the Secretary or
Assistant Secretary of such Material Domestic Subsidiary and (iii) a favorable
opinion of counsel to such Material Domestic Subsidiary in form and substance
reasonably satisfactory to the Administrative Agent.
(c) On the date that the Borrower incurs any Indebtedness to any
Material Domestic Subsidiary, the Borrower shall cause such Material Domestic
Subsidiary to execute and deliver to the Administrative Agent, in sufficient
copies for each Lender (i) a subordination agreement (each such subordination
agreement being a "Subordination Agreement") subordinating such Indebtedness to
the Indebtedness and other obligations of the Borrower hereunder and under the
Notes on terms reasonably satisfactory to the Administrative Agent, (ii) copies
of the Certificate or Articles of Incorporation and bylaws or other organization
document of such Material Domestic Subsidiary, a resolution of the board of
directors (or similar governing body) of such Material Domestic Subsidiary
approving the form of the Subordination Agreement and its execution, delivery
and performance, all certified as true and complete by the Secretary or
Assistant Secretary of such Material Domestic Subsidiary and (iii) a favorable
opinion of counsel to such Material Domestic Subsidiary in form and substance
reasonably satisfactory to the Required Lenders.
ARTICLE VII
EVENTS OF DEFAULT
If any of the following events ("Events of Default") shall occur:
(a) the Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
for prepayment thereof or otherwise;
(b) the Borrower or any Material Domestic Subsidiary shall fail to pay
any interest on any Loan or any fee or any other amount (other than, in the case
of the Borrower, an amount referred to in clause (a) of this Article) payable
under this Agreement or any other Loan Document, when and as the same shall
become due and payable, and such failure shall continue unremedied for a period
of three Business Days;
(c) any representation or warranty made or deemed made by or on behalf
of the Borrower or any Subsidiary in or in connection with this Agreement or any
other Loan Document or any amendment or modification hereof or thereof or waiver
hereunder or thereunder, or in any report, certificate, financial statement or
other document furnished pursuant to or in connection with this Agreement or any
amendment or modification hereof or thereof or waiver hereunder or thereunder,
shall prove to have been incorrect in any material respect when made or deemed
made;
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(d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Section 5.02, 5.03 (with respect to the
Borrower's existence) or 5.08 or in Article VI;
(e) the Borrower or any Material Domestic Subsidiary shall fail to
observe or perform any covenant, condition or agreement contained in this
Agreement or any other Loan Document (other than those specified in clause (a),
(b) or (d) of this Article), and such failure shall continue unremedied for a
period of 30 days after the earlier of (i) notice thereof from the
Administrative Agent to the Borrower (which notice will be given at the request
of any Lender) and (ii) the Borrower becomes aware thereof;
(f) the Borrower or any Subsidiary (other than an Excluded Domestic
Subsidiary) shall fail to make any payment (whether of principal or interest and
regardless of amount) in respect of any Material Indebtedness, when and as the
same shall become due and payable;
(g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables or
permits (with or without the giving of notice, the lapse of time or both) the
holder or holders of any Material Indebtedness or any trustee or agent on its or
their behalf to cause any Material Indebtedness to become due, or to require the
prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled
maturity; provided that this clause (g) shall not apply to (i) any Indebtedness
of an Excluded Domestic Subsidiary or (ii) secured Indebtedness that becomes due
as a result of the voluntary sale or transfer of the property or assets securing
such Indebtedness if such voluntary sale or transfer is for the Fair Market
Value of such property or assets;
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other relief
in respect of the Borrower or any Subsidiary (other than an Excluded Domestic
Subsidiary) or its debts, or of a substantial part of its assets, under any
federal, state or foreign bankruptcy, insolvency, receivership or similar law
now or hereafter in effect or (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Borrower or any
Subsidiary or for a substantial part of its assets, and, in any such case, such
proceeding or petition shall continue undismissed for 90 days or an order or
decree approving or ordering any of the foregoing shall be entered;
(i) the Borrower or any Subsidiary (other than an Excluded Domestic
Subsidiary) shall (i) voluntarily commence any proceeding or file any petition
seeking liquidation, reorganization or other relief under any federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or hereafter in
effect, (ii) consent to the institution of, or fail to contest in a timely and
appropriate manner, any proceeding or petition described in clause (h) of this
Article, (iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Borrower or any
such Subsidiary or for a substantial part of its assets, (iv) file an answer
admitting the material allegations of a petition filed against it in any such
proceeding,
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(v) make a general assignment for the benefit of creditors or (vi) take any
action for the purpose of effecting any of the foregoing;
(j) the Borrower or any Subsidiary (other than an Excluded Domestic
Subsidiary) shall become unable, admit in writing its inability or fail
generally to pay its debts as they become due;
(k) one or more judgments for the payment of money in an aggregate
amount in excess of $15,000,000 shall be rendered against the Borrower, any
Subsidiary (other than an Excluded Domestic Subsidiary) or any combination
thereof and the same shall remain undischarged for a period of 30 consecutive
days during which execution shall not be effectively stayed, or any action shall
be legally taken by a judgment creditor to attach or levy upon any assets of the
Borrower or any such Subsidiary to enforce any such judgment;
(l) an ERISA Event shall have occurred that, in the opinion of the
Required Lenders, when taken together with all other ERISA Events that have
occurred, could reasonably be expected to result in liability of the Borrower
and the Subsidiaries in an aggregate amount exceeding $15,000,000 for all
periods; or
then, (A) in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower: (i) terminate
the Commitments, and thereupon the Commitments shall terminate immediately, and
declare the Loans, if any, then outstanding to be due and payable in whole (or
in part, in which case any principal not so declared to be due and payable may
thereafter be declared to be due and payable), and thereupon the principal of
the Loans so declared to be due and payable, together with accrued interest
thereon and all fees and other obligations of the Borrower accrued hereunder,
shall become due and payable immediately, without presentment, demand, protest
or other notice of any kind including notice of intent to accelerate, all of
which are hereby waived by the Borrower; and (ii) exercise all other rights and
remedies hereunder, under the other Loan Documents or otherwise available at law
or in equity; and (B) in case of any event with respect to the Borrower
described in clause (h) or (i) of this Article, the Commitments shall
automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and all fees and other obligations of the
Borrower accrued hereunder, shall automatically become due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower and (to the extent permitted by law) the
Administrative Agent may exercise all other rights and remedies hereunder, under
the other Loan Documents or otherwise available at law or in equity.
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ARTICLE VIII
THE AGENTS
SECTION 8.01. Authorization, Action and Reliance. (a) Except as
expressly provided in Sections 8.02 and 8.03, each of the Lenders and the
Issuing Bank hereby irrevocably appoints the Administrative Agent and the
Auction Administration Agent as its agents and authorizes the Administrative
Agent and the Auction Administration Agent to take such actions on its behalf
and to exercise such powers as are delegated to such Agent by the terms hereof,
together with such actions and powers as are reasonably incidental thereto.
(b) Each of the banks serving as the Administrative Agent and as
Auction Administration Agent hereunder shall have the same rights and powers in
its capacity as a Lender as any other Lender and may exercise the same as though
it were not the Administrative Agent or the Auction Administration Agent, as the
case may be, and each such bank and its Affiliates may accept deposits from,
lend money to and generally engage in any kind of business with the Borrower or
any Subsidiary or other Affiliate thereof as if it were not the Administrative
Agent or the Auction Administration Agent hereunder.
(c) Neither Agent shall have any duties or obligations except those
expressly set forth herein. Without limiting the generality of the foregoing,
(i) neither Agent shall be subject to any fiduciary or other implied duties,
regardless of whether a Default or an Event of Default has occurred and is
continuing, (ii) neither Agent shall have any duty to take any discretionary
action or exercise any discretionary powers, except discretionary rights and
powers expressly contemplated hereby that such Agent is required to exercise in
writing by the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary under the circumstances as provided in Section
9.02), and (iii) except as expressly set forth herein, neither Agent shall have
any duty to disclose, and shall not be liable for the failure to disclose, any
information relating to the Borrower or any Subsidiary that is communicated to
or obtained by the bank serving as Administrative Agent or as Auction
Administration Agent or any of their respective Affiliates in any capacity.
Neither Agent shall be liable for any action taken or not taken by it with the
consent or at the request of the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02) or in the absence of its own gross negligence or
wilful misconduct (IT BEING THE EXPRESS INTENTION OF THE PARTIES THAT THE AGENTS
AND THEIR RESPECTIVE DIRECTORS, OFFICERS, AGENTS AND EMPLOYEES SHALL HAVE NO
LIABILITY FOR ACTIONS AND OMISSIONS RESULTING FROM THEIR ORDINARY SOLE OR
CONTRIBUTORY NEGLIGENCE). Neither Agent shall be deemed to have knowledge of any
Default or Event of Default unless and until written notice thereof is given to
the Administrative Agent or the Auction Administration Agent, as the case may
be, by the Borrower or a Lender, and neither Agent shall be responsible for or
have any duty to ascertain or inquire into (i) any statement, warranty or
representation made in or in connection with this Agreement, (ii) the contents
of any certificate, report or other document delivered hereunder or in
connection herewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein, (iv) the
validity, enforceability, effectiveness or genuineness of this Agreement or any
other agreement, instrument or document, or (v) the
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satisfaction of any condition set forth in Article IV or elsewhere herein, other
than to confirm receipt of items expressly required to be delivered to such
Agent.
(d) Each Agent shall be entitled to rely upon, and neither Agent shall
incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person. Each Agent also may rely
upon any statement made to it orally or by telephone and believed by it to be
made by the proper Person, and shall not incur any liability for relying
thereon. Each Agent may consult with legal counsel (who may be counsel for the
Borrower), independent accountants and other experts selected by it, and shall
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts.
(e) Either Agent may perform any and all its duties and exercise its
rights and powers by or through any one or more sub-agents appointed by such
Agent. Such Agent and any such sub-agent may perform any and all its duties and
exercise its rights and powers through their respective Related Parties. The
exculpatory provisions of the preceding paragraphs shall apply to any such
sub-agent and to the Related Parties of such Agent and any such sub-agent, and
shall apply to their respective activities in connection with the syndication of
the credit facilities provided for herein as well as activities as Agent.
SECTION 8.02. Successor Administrative Agent. The Administrative Agent
may resign at any time by giving written notice thereof to the Lenders, the
Issuing Bank, the Auction Administration Agent and the Borrower and may be
removed as Administrative Agent under this Agreement and the Notes at any time
with or without cause by the Required Lenders. Upon any such resignation or
removal, the Required Lenders shall have the right to appoint a successor
Administrative Agent. If no successor Administrative Agent shall have been so
appointed by the Required Lenders, and shall have accepted such appointment,
within 30 calendar days after the retiring Administrative Agent's giving of a
notice of resignation or the Required Lenders' removal of the retiring
Administrative Agent, then the retiring Administrative Agent may, on behalf of
the Lenders and the Issuing Bank, appoint a successor Administrative Agent. Any
successor Administrative Agent appointed under this Section 8.02 shall be a
commercial bank organized or licensed under the laws of the United States or of
any state thereof and having a combined capital and surplus of at least
$100,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder and under the Notes by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties
and obligations under this Agreement and the Notes. After any retiring
Administrative Agent's resignation or removal as Administrative Agent hereunder
and under the Notes, the provisions of this Article VIII shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement and the Notes.
SECTION 8.03. Successor Auction Administration Agent. The Auction
Administration Agent may resign at any time by giving written notice thereof to
the Lenders, the
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Administrative Agent and the Borrower and may be removed as Auction
Administration Agent under this Agreement and the Notes at any time with or
without cause by the Required Lenders. Upon any such resignation or removal, the
Required Lenders shall have the right to appoint a successor Auction
Administration Agent. If no successor Auction Administration Agent shall have
been so appointed by the Required Lenders, and shall have accepted such
appointment, within 30 calendar days after the retiring Auction Administration
Agent's giving of notice of resignation or the Required Lenders' removal of the
retiring Auction Administration Agent, then the retiring Auction Administration
Agent may, on behalf of the Lenders, appoint a successor Auction Administration
Agent. Any successor Auction Administration Agent appointed under this Section
8.03 shall be a commercial bank organized or licensed under the laws of the
United States or of any state thereof and having a combined capital and surplus
of at least $100,000,000. Upon the acceptance of any appointment as Auction
Administration Agent hereunder and under the Notes by a successor Auction
Administration Agent, such successor Auction Administration Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Auction Administration Agent, and the retiring
Auction Administration Agent shall be discharged from its duties and obligations
under this Agreement and the Notes. After any retiring Auction Administration
Agent's resignation or removal as Auction Administration Agent hereunder and
under the Notes, the provisions of this Article VIII shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Auction
Administration Agent under this Agreement and the Notes.
SECTION 8.04. No Duty. No Person named as an agent hereunder (other
than the Agents) shall have any duties, responsibilities or liabilities with
respect to the administration or enforcement of this Agreement and the Notes.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices. (a) The Administrative Agent, the Auction
Administration Agent, any Lender or the holder of any Note, giving consent or
notice or making any request of the Borrower provided for hereunder, shall
notify each Lender, the Administrative Agent and the Auction Administration
Agent thereof. In the event that the holder of any Note (including any Lender)
shall transfer such Note, it shall promptly so advise the Agents, each of which
shall be entitled to assume conclusively that no transfer of any Note has been
made by any holder (including any Lender) unless and until such Agent receives
written notice to the contrary and the assignment has become effective in
accordance with Section 9.04(d). Notices, consents, requests, approvals, demands
and other communications (collectively, "Communications") provided for herein
shall be in writing (including telecopy Communications) and mailed (by certified
mail, return receipt requested), telecopied or delivered (against written
receipt therefor):
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(a) If to the Borrower, to it:
BMC Software, Inc.
2101 CityWest Boulevard
Houston, Texas 77042
Telecopy Number: (713) 918-4000
Attention: Michael Shryock
(b) If to the Administrative Agent, to it at:
Chase Bank of Texas, N.A.
Agency Services
One Chase Manhattan Plaza
8th Floor
New York, New York 10081
Telephone Number: (212) 552-7943
Telecopy Number: (212) 552-7490
Attention: Muniram Appanna
with copies to:
Chase Bank of Texas, N.A.
Manager, High Technology Group
Mail Station 07 CBB-S 354
P. O. Box 2558
Houston, Texas 77252
Telecopy Number: (713) 216-2095
Attention: Michael Cerda
(c) If to the Auction Administration Agent, to it at:
Chase Agency Services
One Chase Manhattan Plaza, 8th Floor
New York, New York 10081
Telephone Number: (212) 552-5627
Telecopy Number: (212) 552-7239
Attention: Christopher Consomer
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(d) If to the Issuing Bank, to it at:
Chase Bank of Texas, N.A.
Manager, High Technology Group
Main Station 07 CBB-S 354
P. O. Box 2558
Houston, Texas 77252
Telecopy Number: (713) 216-2095
Attention: Michael Cerda
(e) If to any Lender, as specified on the signature page for such
Lender hereto or, in the case of any Person who becomes a Lender after the
Execution Date, as specified in the Administrative Questionnaire of such Person,
on the signature page of the Assignment and Acceptance executed by such Lender
or, in the case of any party, such other address, telecopy or telex number as
such party may hereafter specify for such purpose by notice to the other
parties. All Communications shall, when mailed (by certified mail, return
receipt requested), telecopied or delivered (against written receipt therefor),
be effective when deposited in the mails, sent by telecopier to any party to the
telecopier number as set forth herein or on the signature page hereof or on the
signature page of the Assignment and Acceptances (or other telecopy number
designated by such party in a Communication to the other parties hereto) and
receipt thereof is acknowledged by such party; provided, however, Communications
to either Agent pursuant to Article II or Article VIII shall not be effective
until received by such Agent.
SECTION 9.02. Waivers; Amendments; Replacement Notes. (a) No failure or
delay by the Administrative Agent, the Issuing Bank or any Lender in exercising
any right or power hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Administrative Agent, the Issuing Bank and the Lenders
hereunder are cumulative and are not exclusive of any rights or remedies that
they would otherwise have. No waiver of any provision of this Agreement or
consent to any departure by the Borrower therefrom shall in any event be
effective unless the same shall be permitted by paragraph (b) of this Section,
and then such waiver or consent shall be effective only in the specific instance
and for the purpose for which given. Without limiting the generality of the
foregoing, the making of a Loan or the issuance of a Letter of Credit shall not
be construed as a waiver of any Default or Event of Default, regardless of
whether the Administrative Agent or any Lender may have had notice or knowledge
of such Default or Event of Default at the time.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders or by the Borrower and the
Administrative Agent with the consent of the Required Lenders; provided that no
such agreement shall (i) increase the Commitment of any Lender without the
written consent of such Lender, (ii) reduce the principal amount of any Loan or
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LC Disbursement or reduce the rate of interest thereon, or reduce any fees
payable hereunder, without the written consent of each Lender affected thereby,
(iii) postpone the scheduled date of payment of the principal amount of any Loan
or LC Disbursement, or any interest thereon, or any fees payable hereunder, or
reduce the amount of, waive or excuse any such payment, or postpone the
scheduled date of expiration of any Commitment, without the written consent of
each Lender affected thereby, (iv) change Section 2.18(b) or (c) in a manner
that would alter the pro rata sharing of payments required thereby, without the
written consent of each Lender, (v) release any Subsidiary Guaranty, without the
written consent of each Lender, or (vi) change any of the provisions of this
Section or the definition of "Required Lenders" or any other provision hereof
specifying the number or percentage of Lenders required to waive, amend or
modify any rights hereunder or make any determination or grant any consent
hereunder, without the written consent of each Lender; provided further that no
such agreement shall amend, modify or otherwise affect the rights or duties of
the Issuing Bank, the Administrative Agent or the Auction Administration Agent
hereunder without the prior written consent of the Issuing Bank, the
Administrative Agent or the Auction Administration Agent, as the case may be.
(c) In the event that any Note shall be lost, stolen or destroyed, or
become mutilated, the Lender owning such Note may obtain a replacement therefor
in accordance with the following provisions. Such Lender shall submit to the
Administrative Agent, for delivery to the Borrower, a written request for the
Borrower's issuance and delivery of a replacement for such Note, accompanied
(i) in the case of loss, theft or destruction by
(A) an affidavit of an officer of such Lender setting forth
the date, named payee and unpaid principal amount of such Note, and the
last date through which interest has been paid thereon, and the facts
relating to the loss, theft or destruction thereof, and
(B) an unsecured agreement of indemnity executed by such
Lender in a form reasonably satisfactory to the Borrower, or
(ii) in the case of mutilation, by such mutilated Note for cancellation
thereof.
Upon receipt of such documents the Borrower shall execute and deliver to the
Agent for delivery to such Lender or as it may instruct, a new Note, dated and
bearing interest from the date to which interest shall have been paid on such
lost, stolen, destroyed or mutilated Note or dated the date of such lost,
stolen, destroyed or mutilated Note if no interest shall have been paid thereon.
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower
shall pay (i) all reasonable out-of-pocket expenses incurred by the Agents and
their respective Affiliates, including the reasonable fees, charges and
disbursements of counsel for the Agents, in connection with the syndication of
the credit facilities provided for herein, the preparation and administration
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of this Agreement or any amendments, modifications or waivers of the provisions
hereof (whether or not the transactions contemplated hereby or thereby shall be
consummated), (ii) all reasonable out-of-pocket expenses incurred by the Issuing
Bank in connection with the issuance, amendment, renewal or extension of any
Letter of Credit or any demand for payment thereunder and (iii) all
out-of-pocket expenses incurred by the Agents or any Lender, including the fees,
charges and disbursements of any counsel for the Agents or any Lender, in
connection with the enforcement or protection of its rights in connection with
this Agreement, including its rights under this Section, or in connection with
the Loans made or Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.
(b) The Borrower shall indemnify the Administrative Agent, the Auction
Administration Agent, the Issuing Bank and each Lender, and each Related Party
of any of the foregoing Persons (each such Person being called an "Indemnitee")
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including the reasonable fees,
charges and disbursements of any counsel for any Indemnitee, incurred by or
asserted against any Indemnitee arising out of, in connection with, or as a
result of (i) the execution or delivery of this Agreement or any agreement or
instrument contemplated hereby, the performance by the parties hereto of their
respective obligations hereunder or the consummation of the Transactions or any
other transactions contemplated hereby, (ii) any Loan or Letter of Credit or the
use of the proceeds therefrom (including any refusal by the Issuing Bank to
honor a demand for payment under a Letter of Credit if the documents presented
in connection with such demand do not strictly comply with the terms of such
Letter of Credit), (iii) any actual or alleged presence or release of Hazardous
Materials on or from any property owned or operated by the Borrower or any
Subsidiary, or any Environmental Liability related in any way to the Borrower or
any Subsidiary, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory and regardless of whether any Indemnitee is a
party thereto; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or
related expenses resulted from the gross negligence or wilful misconduct of such
Indemnitee. WITHOUT LIMITING ANY PROVISION OF THIS AGREEMENT, IT IS THE EXPRESS
INTENTION OF THE PARTIES HERETO THAT EACH PERSON TO BE INDEMNIFIED HEREUNDER
SHALL BE INDEMNIFIED AND HELD HARMLESS AGAINST ANY AND ALL LOSSES, LIABILITIES,
CLAIMS OR DAMAGES ARISING OUT OF OR RESULTING FROM THE ORDINARY, SOLE OR
CONTRIBUTORY NEGLIGENCE OF SUCH PERSON.
(c) To the extent that the Borrower fails to pay any amount required to
be paid by it to the Administrative Agent, the Auction Administration Agent or
the Issuing Bank under paragraph (a) or (b) of this Section, each Lender
severally agrees to pay to the Administrative Agent, the Auction Administration
Agent or the Issuing Bank, as the case may be, such Lender's Applicable
Percentage (determined as of the time that the applicable unreimbursed expense
or indemnity payment is sought) of such unpaid amount; provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted
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against the Administrative Agent, the Auction Administration Agent or the
Issuing Bank in its capacity as such.
(d) To the extent permitted by applicable law, the Borrower shall not
assert, and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement or any agreement or instrument contemplated hereby, the
Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.
(e) All amounts due under this Section shall be payable not later than
three days after written demand therefor.
SECTION 9.04. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), except that the
Borrower may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and
void). Nothing in this Agreement, expressed or implied, shall be construed to
confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby and, to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent,
the Issuing Bank, the Auction Administration Agent and the Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.
(b) Any Lender may assign to one or more assignees all or a portion of
its rights and obligations under this Agreement (including all or a portion of
its Commitment and the Loans at the time owing to it); provided that (i) except
in the case of an assignment to a Lender or an Affiliate of a Lender, each of
the Borrower and the Administrative Agent (and in the case of an assignment of
all or a portion of a Commitment or any Lender's obligations in respect of its
LC Exposure, the Issuing Bank) must give their prior written consent to such
assignment (which consent shall not be unreasonably withheld), (ii) except in
the case of an assignment to a Lender or an Affiliate of a Lender or an
assignment of the entire remaining amount of the assigning Lender's Commitment,
the amount of the Commitment of the assigning Lender subject to each such
assignment (determined as of the date the Assignment and Acceptance with respect
to such assignment is delivered to the Administrative Agent) shall not be less
than $5,000,000 unless each of the Borrower and the Administrative Agent
otherwise consent, (iii) each partial assignment shall be made as an assignment
of a proportionate part of all the assigning Lender's rights and obligations
under this Agreement, except that this clause (iii) shall not apply to rights in
respect of outstanding Competitive Loans, (iv) the parties to each assignment
shall execute and deliver to the Administrative Agent (or such other Person as
may be indicated thereon) an Assignment and Acceptance in the form of Exhibit
9.04 (the "Assignment and Acceptance"), together with a processing and
recordation fee of $3,500, and (v) the assignee, if it shall not be a Lender,
shall deliver to the Administrative Agent an Administrative Questionnaire; and
provided further that any
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consent of the Borrower otherwise required under this paragraph shall not be
required if an Event of Default has occurred and is continuing. Subject to
acceptance and recording thereof pursuant to paragraph (d) of this Section, from
and after the effective date specified in each Assignment and Acceptance the
assignee thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Acceptance, have the rights and obligations of a
Lender under this Agreement, and the assigning Lender thereunder shall, to the
extent of the interest assigned by such Assignment and Acceptance, be released
from its obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 2.15, 2.16, 2.17 and 9.03). Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this paragraph shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (e) of this Section.
(c) The Administrative Agent, acting for this purpose as an agent of
the Borrower, shall maintain at one of its offices in Houston, Texas a copy of
each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans and LC Disbursements owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive, and the Borrower, the Administrative Agent,
the Auction Administration Agent and the Lenders may treat each Person whose
name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the Borrower, the
Issuing Bank, the Auction Administration Agent and any Lender, at any reasonable
time and from time to time upon reasonable prior notice.
(d) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by paragraph
(b) of this Section, the Administrative Agent shall accept such Assignment and
Acceptance and record the information contained therein in the Register. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.
(e) Any Lender may, without the consent of the Borrower, the Issuing
Bank, the Administrative Agent or the Auction Administration Agent, sell
participations to one or more banks or other entities (a "Participant") in all
or a portion of such Lender's rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans owing to it);
provided that (i) such Lender's obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (iii) the Borrower, the
Administrative Agent, the Auction Administration Agent, the Issuing Bank and the
other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement and
the other Loan Documents. Any
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agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and the other Loan Documents and to approve any amendment,
modification or waiver of any provision of this Agreement and the other Loan
Documents; provided that such agreement or instrument may provide that such
Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 9.02(b) that
affects such Participant. Subject to paragraph (f) of this Section, the Borrower
agrees that each Participant shall be entitled to the benefits of Sections 2.15,
2.16 and 2.17 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to paragraph (b) of this Section. To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 9.08 as though it were a Lender, provided such Participant agrees to be
subject to Section 2.18(c) as though it were a Lender.
(f) A Participant shall not be entitled to receive any greater payment
under Section 2.15, 2.16 or 2.17 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the
Borrower's prior written consent.
(g) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement and its Notes to secure
obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
SECTION 9.05. Survival. All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any Loans
and the issuance of any Letter of Credit, regardless of any investigation made
by any such other party or on its behalf and notwithstanding that the
Administrative Agent, the Auction Administration Agent or any Lender may have
had notice or knowledge of any Default or Event of Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any fee or any other amount payable under this
Agreement is outstanding and unpaid or any Letter of Credit is outstanding and
so long as the Commitments have not expired or terminated. The provisions of
Sections 2.15, 2.16, 2.17, 9.03 and 9.12 and Article VIII shall survive and
remain in full force and effect regardless of the consummation of the
transactions contemplated hereby, the repayment of the Loans, the expiration or
termination of the Letters of Credit and the Commitments or the termination of
this Agreement, the Notes or any provision hereof.
SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement
may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract.
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This Agreement, the Notes, the Administrative Agent's Letter, the Auction
Administration Agent's Letter, the Subordination Agreements and the Subsidiary
Guaranties, if any, constitute the entire contract among the parties relating to
the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Except
as provided in Section 4.01, this Agreement shall become effective when it shall
have been executed by the Administrative Agent and when the Administrative Agent
shall have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Delivery of an executed counterpart of a signature page
of this Agreement by telecopy shall be effective as delivery of a manually
executed counterpart of this Agreement.
SECTION 9.07. Severability. Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 9.08. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other obligations at any time
owing by such Lender or Affiliate to or for the credit or the account of the
Borrower against any of and all the obligations of the Borrower now or hereafter
existing under this Agreement held by such Lender, irrespective of whether or
not such Lender shall have made any demand under this Agreement and although
such obligations may be unmatured. The rights of each Lender under this Section
are in addition to other rights and remedies (including other rights of setoff)
which such Lender may have.
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of
Process. (a) This Agreement shall be construed in accordance with and governed
by the law of the State of Texas.
(b) The Borrower hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of the courts of the
State of Texas sitting in Houston, Texas and of the United States District Court
of the Southern District of Texas, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to this Agreement, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such Texas State or, to
the extent permitted by law, in such federal courts. Each of the parties hereto
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that the Administrative Agent, the Auction Administration Agent, the
Issuing Bank or any Lender may otherwise have to bring any action or
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proceeding relating to this Agreement against the Borrower or its properties in
the courts of any jurisdiction.
(c) The Borrower hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement in any court referred to in
paragraph (b) of this Section. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices (other than by telecopy) in Section
9.01. Nothing in this Agreement will affect the right of any party to this
Agreement to serve process in any other manner permitted by law.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 9.12. Confidentiality. Each of the Administrative Agent, the
Auction Administration Agent and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its and its Affiliates' directors, officers, employees
and agents, including accountants, legal counsel and other advisors (it being
understood that the Persons to whom such disclosure is made will be informed of
the confidential nature of such Information and instructed to keep such
Information confidential), (b) to the extent requested by any regulatory
authority, (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process (and, in the event any such disclosing
Person is served with a subpoena or similar legal process, such disclosing
Person will provide the Borrower with a copy thereof to the extent permitted by
law), (d) to any other party to this Agreement, (e) in connection with the
exercise of any remedies hereunder or any suit, action or proceeding relating to
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this Agreement or the enforcement of rights hereunder, (f) subject to an
agreement containing provisions substantially the same as those of this Section,
to any assignee of or Participant in, or any prospective assignee of or
Participant in, any of its rights or obligations under this Agreement, (g) with
the consent of the Borrower or (h) to the extent such Information (i) becomes
publicly available other than as a result of a breach of this Section or (ii)
becomes available to the Administrative Agent, the Auction Administration Agent,
the Issuing Bank or any Lender on a nonconfidential basis from a source other
than the Borrower. For the purposes of this Section, "Information" means all
information received from the Borrower relating to the Borrower or its business
or any Subsidiary other than any such information that is available to the
Administrative Agent, the Auction Administration Agent, the Issuing Bank or any
Lender on a nonconfidential basis prior to disclosure, by the Borrower or any
Subsidiary; provided that, in the case of information received from the Borrower
after the Execution Date, such information is clearly identified at the time of
delivery as confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.
SECTION 9.13. Interest Rate Limitation. (a) Notwithstanding anything to
the contrary in this Agreement or any other Loan Document, it is the intention
of each party hereto to comply strictly with all usury laws applicable to it
regarding the contracting for, and the taking, reserving, charging, collection,
payment and receipt of, interest (which, for purposes of this Section 9.13,
shall be deemed to include any compensation received by any Lender for the use,
forbearance or detention of money (as such terms are used in, the Texas Finance
Code and the Texas Credit Title) under or in connection with the Loan
Documents), whether such laws are now or hereafter in effect and whether such
laws are those of the United States or other applicable jurisdiction (the
"Applicable Usury Laws").
(b) With respect to the Lenders and the Issuing Bank, if any payment by
the Borrower or other Person to any Lender hereunder or in connection with any
transaction contemplated hereby (including any payment upon acceleration of the
maturity of any Note) would produce a rate of interest in excess of the "Highest
Lawful Rate" (as defined in paragraph (e) below), or if any such payment would
result in a Borrower or any other Person paying or being deemed to have paid to
any Lender or the Issuing Bank any interest in excess of the "Maximum Amount of
Interest" (as defined in paragraph (c) below) or if any Lender or the Issuing
Bank shall for any reason receive any unearned interest in violation of any
Applicable Usury Law, or if any transaction contemplated by, or any provision
of, any Loan Document would otherwise be usurious under Applicable Usury Laws,
then, notwithstanding anything to the contrary in any Loan Document, the parties
hereto agree, to the maximum extent that they may do so under applicable law,
that: (i) the provisions of this Section 9.13 shall govern and control; (ii) the
aggregate amount of all interest under Applicable Usury Laws that is contracted
for, taken, reserved, charged, collected or received pursuant to the Loan
Documents, or otherwise, shall be limited such that under no circumstances shall
such interest exceed the Maximum Amount of Interest; (iii) neither the Borrower
nor any other Person shall be obligated to pay any amount of interest that
exceeds the Maximum Amount of
-69-
<PAGE> 74
Interest; and (iv) the provisions of the Loan Documents immediately shall be
deemed reformed, without the necessity of the execution of any new document or
instrument, so as to comply with the Applicable Usury Laws (it being the
intention of the parties hereto, to the fullest extent permitted by applicable
law, to render inapplicable any and all penalties of any kind provided by any
Applicable Usury Law as a result of any such excess interest).
(c) To the fullest extent permitted by Applicable Usury Laws, if any
payment by the Borrower or any other Person under any Loan Document (including
any payment upon acceleration of the maturity of any Note) results in the
Borrower or any other Person actually having paid to any Lender or the Issuing
Bank any interest in excess of the maximum amount of interest that such Lender
may contract for, take, reserve, charge, collect or receive under Applicable
Usury Laws (the "Maximum Amount of Interest"), then such excess amount shall be
applied to the reduction of the principal balance of the Loan of such Lender or
to the amounts owed to the Issuing Bank or to other amounts (other than
interest) payable hereunder to such Lender or the Issuing Bank and if no such
principal or Letter of Credit is then outstanding, and no such other amount is
then payable, such excess or part thereof remaining shall be repaid to the
Borrower or such other Person.
(d) All interest paid, or agreed to be paid, pursuant to the Loan
Documents shall, to the fullest extent permitted by Applicable Usury Laws, be
amortized, prorated, allocated and spread throughout the stated term of any
indebtedness incurred under or evidenced by the Loan Documents.
(e) As used herein, the term "Highest Lawful Rate" means, with respect
to any Lender, the maximum rate of interest that may be contracted for, taken,
reserved, charged, collected or received by such Lender in respect of the
extensions of credit under or evidenced by the Loan Documents under the
Applicable Usury Laws. In this connection, insofar as Texas law is ultimately
determinative of the Highest Lawful Rate, the Highest Lawful Rate shall be
computed on the basis of the "weekly ceiling" from time to time in effect
referred to in Section 303.201 of the Texas Finance Code and Articles 1D.002 and
1D.003 of the Texas Credit Title; provided, however, that to the fullest extent
permitted by the Texas Finance Code and the Texas Credit Title, as applicable,
the Administrative Agent reserves the right to change from time to time the
ceiling on which the Highest Lawful Rate is based under such Texas laws by
giving written notice thereof to the Borrower in the manner and to the extent
required by such Texas laws. Notwithstanding the foregoing, the Highest Lawful
Rate for any Lender in all of its various capacities hereunder shall not be
limited to rate ceilings permitted under Texas law, if other Applicable Usury
Laws (whether applicable federal or state laws and whether now or hereafter in
effect) shall permit a higher rate of interest to be contracted for, taken,
reserved, charged, collected and received under the Loan Documents.
(f) In the event that any rate of interest set forth in this Agreement
on any Loan (a "Stated Rate"), together with any fees or other amounts payable
under the Loan Documents to any Lender deemed to constitute interest under
Applicable Usury Laws ("Additional Interest"), exceeds the Highest Lawful Rate,
then, the rate at which interest will accrue pursuant to the Loan Documents
shall be limited, notwithstanding anything to the contrary in the Loan
Documents, to the
-70-
<PAGE> 75
Highest Lawful Rate; provided, however, that, to the fullest extent permitted by
Applicable Usury Laws, any subsequent reductions in any Stated Rate shall not
reduce the rate at which interest will accrue pursuant to the Loan Documents
below the Highest Lawful Rate until the aggregate amount of interest payable to
any Lender or the Issuing Bank actually accrued pursuant to the Loan Documents,
together with all Additional Interest payable to such Lender, equals the amount
of interest which would have accrued if the Stated Rates had at all times been
in effect and such Additional Interest, if any, had been paid in full.
(g) In the event that, at maturity or upon payment in full of all
amounts payable under the Loan Documents, the total amount of interest
(including all Additional Interest) accrued and paid under the term of the Loan
Documents by the Borrower to any Lender or the Issuing Bank is less than the
total amount of interest (including Additional Interest) which would have
accrued and been paid thereunder to such Lender or the Issuing Bank by the
Borrower if the Stated Rates had at all times been in effect and all Additional
Interest had been paid in full, then the Borrower shall, to the extent permitted
by Applicable Usury Laws, pay to such Lender or the Issuing Bank an amount equal
to the difference between (1) the lesser of (i) the amount of interest which
would have accrued and been paid if the Highest Lawful Rate for such Lender or
the Issuing Bank had at all times been in effect or (ii) the amount of interest
which would have accrued and been paid if the Stated Rates had at all times been
in effect and all Additional Interest had been paid in full and (2) the amount
of interest (including all Additional Interest) actually accrued and paid by the
Borrower to such Lender or the Issuing Bank pursuant to the Loan Documents.
SECTION 9.14. FINAL AGREEMENT. THIS WRITTEN AGREEMENT, THE NOTES, THE
ADMINISTRATIVE AGENT'S LETTER, THE AUCTION ADMINISTRATION AGENT'S LETTER, THE
SUBORDINATION AGREEMENTS AND THE SUBSIDIARY GUARANTIES, IF ANY, CONSTITUTE A
"LOAN AGREEMENT" AS DEFINED IN SECTION 26.02(a) OF THE TEXAS BUSINESS & COMMERCE
CODE, REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES RELATING TO THE SUBJECT
MATTER HEREOF AND THEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES RELATING TO THE SUBJECT MATTER
HEREOF AND THEREOF.
-71-
<PAGE> 76
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
BMC SOFTWARE, INC.
By: /s/ WILLIAM M. AUSTIN
-------------------------------
Name: William M. Austin
-------------------------------
Title: Chief Financial Officer
-------------------------------
CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION, as Administrative Agent
By: /s/ MICHAEL A. CERDA
-------------------------------
Name: Michael A. Cerda
-------------------------------
Title: Vice President
-------------------------------
THE CHASE MANHATTAN BANK,
as Auction Administration Agent
By: /s/ JANET M. BELDEN
-------------------------------
Name: Janet M. Belden
-------------------------------
Title: Vice President
-------------------------------
<PAGE> 77
NATIONSBANK, NATIONAL ASSOCIATION,
as Syndication Agent
By: /s/ TIMOTHY M. O'CONNOR
-------------------------------
Name: Timothy M. O'Connor
-------------------------------
Title: Vice President
-------------------------------
ABN AMRO BANK, N.V.,
as Documentation Agent
By: /s/ MATHEW HARVEY
-------------------------------
Name: Mathew Harvey
-------------------------------
Title: Vice President
-------------------------------
By: /s/ JAMIE DILLON
-------------------------------
Name: Jamie Dillon
-------------------------------
Title: Vice President
-------------------------------
<PAGE> 78
Issuing Bank:
CHASE BANK OF TEXAS,
NATIONAL ASSOCIATION
By: /s/ MICHAEL A. CERDA
-------------------------------
Name: Michael A. Cerda
-------------------------------
Title: Vice President
-------------------------------
<PAGE> 79
Lender:
Commitment: ABN AMRO BANK, N.V.
$30,000,000.00
By: /s/ MATHEW HARVEY
-------------------------------
Name: Mathew Harvey
-------------------------------
Title: Vice President
-------------------------------
By: /s/ JAMIE DILLON
-------------------------------
Name: Jamie Dillon
-------------------------------
Title: Vice President
-------------------------------
Address for Notices:
208 South LaSalle, Suite 1500
Chicago, Illinois 60604-1003
Telecopy No.: (312) 992-5111
Domestic Lending Office:
208 South LaSalle, Suite 1500
Chicago, Illinois 60604-1003
Eurodollar Lending Office:
208 South LaSalle, Suite 1500
Chicago, Illinois 60604-1003
<PAGE> 80
Lender:
Commitment: BANCA NAZIONALE DEL LAVORO
$20,000,000.00 NEW YORK BRANCH
By: /s/ ROBERTO MANCONE
-------------------------------
Name: Roberto Mancone
-------------------------------
Title: Senior Loan Officer
-------------------------------
By: /s/ LEONARDO VALENTIN
-------------------------------
Name: Leonardo Valentin
-------------------------------
Title: First Vice President
-------------------------------
Address for Notices:
25 West 51st Street
New York, New York 10019
Telecopy No.: (212) 765-2978
Domestic Lending Office:
25 West 51st Street
New York, New York 10019
Eurodollar Lending Office:
25 West 51st Street
New York, New York 10019
<PAGE> 81
Lender:
Commitment: BANK HAPOALIM B.M.
$15,000,000.00 SAN FRANCISCO BRANCH
By: /s/ DAN JOZEFOV
----------------------------------
Dan Jozefov
Vice President
By: /s/ JOHN RICE
----------------------------------
John Rice
Vice President
Address for Notices:
250 Montgomery Street, Suite 700
San Francisco, California 94104
Telecopy No.: (415) 989-9948
Domestic Lending Office:
250 Montgomery Street, Suite 700
San Francisco, California 94104
Eurodollar Lending Office:
250 Montgomery Street, Suite 700
San Francisco, California 94104
<PAGE> 82
Lender:
Commitment: BANK LEUMI USA
$26,000,000.00
By: /s/ RICHARD FREEMAN
-------------------------------
Name: Richard Freeman
-------------------------------
Title: Vice President
-------------------------------
By: /s/ SARIT BROSH
-------------------------------
Name: Sarit Brosh
-------------------------------
Title: First Vice President
-------------------------------
Address for Notices:
564 Fifth Avenue
New York, New York 10036
Telecopy No.: (212) 626-1072
Domestic Lending Office:
564 Fifth Avenue
New York, New York 10036
Eurodollar Lending Office:
564 Fifth Avenue
New York, New York 10036
<PAGE> 83
Lender:
Commitment: BANK OF MONTREAL
$26,000,000.00
By: /s/ BRUCE A. PIETKA
-------------------------------
Name: Bruce A. Pietka
-------------------------------
Title: Director
-------------------------------
Address for Notices:
602 South Figueroa, Suite 4900
Los Angeles, California 90017
Telecopy No.: (213) 239-0680
Domestic Lending Office:
115 South LaSalle Street, 12th Floor
Chicago, Illinois 60603
Eurodollar Lending Office:
115 South LaSalle Street, 12th Floor
Chicago, Illinois 60603
<PAGE> 84
Lender:
Commitment: BANQUE NATIONALE DE PARIS
$26,000,000.00
By: /s/ MICHAEL D. McCORRISTON
-------------------------------
Name: Michael D. McCorriston
-------------------------------
Title: Vice President
-------------------------------
By: /s/ GARVIN S. HOLLES
-------------------------------
Name: Garvin S. Holles
-------------------------------
Title: Vice President
-------------------------------
Address for Notices:
180 Montgomery Street, 3rd Floor
San Francisco, California 94104
Telecopy No.: (415) 772-1925
Domestic Lending Office:
180 Montgomery Street, 3rd Floor
San Francisco, California 94104
Eurodollar Lending Office:
180 Montgomery Street, 3rd Floor
San Francisco, California 94104
<PAGE> 85
Lender:
Commitment: THE BANK OF TOKYO - MITSUBISHI, LTD.
$20,000,000.00 HOUSTON AGENCY
By: /s/ JOHN W. McGHEE
---------------------------------
John W. McGhee
Vice President and Manager
Address for Notices:
1100 Louisiana, Suite 2800
Houston, Texas 77002
Telecopy No.: (713) 658-0116
Domestic Lending Office:
1100 Louisiana, Suite 2800
Houston, Texas 77002
Eurodollar Lending Office:
1100 Louisiana, Suite 2800
Houston, Texas 77002
<PAGE> 86
Lender:
Commitment: BANK ONE, TEXAS, N.A.
$26,000.000.00
By: /s/ MICHAEL A. HOSKINS
-------------------------------
Name: Michael A. Hoskins
-------------------------------
Title: Managing Director
-------------------------------
Address for Notices:
910 Travis Street
Houston, Texas 77002-5860
Telecopy No.: (713) 759-6199
Domestic Lending Office:
910 Travis Street
Houston, Texas 77002-5860
Eurodollar Lending Office:
910 Travis Street
Houston, Texas 77002-5860
<PAGE> 87
Lender:
Commitment: CITICORP USA, INC.
$26,000.000.00
By: /s/ HILARY NICKERSON
-------------------------------
Hilary Nickerson
Vice President
Address for Notices:
400 Perimeter Center Terrace
Suite 600
Atlanta, Georgia 30346
Telecopy No.: (707) 668-8137
Domestic Lending Office:
400 Perimeter Center Terrace
Suite 600
Atlanta, Georgia 30346
Eurodollar Lending Office:
400 Perimeter Center Terrace
Suite 600
Atlanta, Georgia 30346
<PAGE> 88
Lender:
Commitment: CHASE BANK OF TEXAS,
$35,000,000.00 NATIONAL ASSOCIATION
By: /s/ MICHAEL A. CERDA
-------------------------------
Name: Michael A. Cerda
-------------------------------
Title: Vice President
-------------------------------
Address for Notices:
712 Main Street
Houston, Texas 77002
Telecopy No.: (713) 216-2095
Domestic Lending Office:
712 Main Street
Houston, Texas 77002
Eurodollar Lending Office:
712 Main Street
Houston, Texas 77002
<PAGE> 89
Lender:
Commitment: COMERICA BANK
$26,000,000.00
By: /s/ REGINALD M. GOLDSMITH, III
---------------------------------
Name: Reginald M. Goldsmith, III
-------------------------------
Title: Vice President
-------------------------------
Address for Notices:
National Corporate Banking
4100 Spring Valley, Suite 900
Dallas, Texas 75244
Telecopy No.: (214) 818-2550
Domestic Lending Office:
500 Woodward Avenue
Detroit, Michigan 48226
Eurodollar Lending Office:
500 Woodward Avenue
Detroit, Michigan 48226
<PAGE> 90
Lender:
Commitment: CREDIT LYONNAIS
$26,000,000.00 NEW YORK BRANCH
By: /s/ ROBERT IVOSEVICH
----------------------------------
Name: Robert Ivosevich
-------------------------------
Title: Senior Vice President
-------------------------------
Address for Notices:
2200 Ross Avenue
Suite 4400W
Dallas, Texas 75201
Telecopy No.: (214) 220-2323
Domestic Lending Office:
2200 Ross Avenue
Suite 4400W
Dallas, Texas 75201
Eurodollar Lending Office:
2200 Ross Avenue
Suite 4400W
Dallas, Texas 75201
<PAGE> 91
Lender:
Commitment: THE DAI-ICHI KANGYO BANK, LTD.
$10,000,000.00
By: /s/ NELSON Y. CHANG
----------------------------------
Name: Nelson Y. Chang
-------------------------------
Title: Account Officer
-------------------------------
Address for Notices:
One World Trade Center
48th Floor
New York, New York 10048
Telecopy No.: (212) 912-1879
Domestic Lending Office:
One World Trade Center
48th Floor
New York, New York 10048
Eurodollar Lending Office:
One World Trade Center
48th Floor
New York, New York 10048
<PAGE> 92
Lender:
Commitment: FIRST UNION NATIONAL BANK
$26,000,000.00
By: /s/ PAUL L. MENCONI
------------------------------
Name: Paul L. Menconi
------------------------------
Title: Vice President
------------------------------
Address for Notices:
Capital Markets Group
301 South College Street
Charlotte, North Carolina 28288-0745
Telecopy No.: (704) 383-7236
Domestic Lending Office:
Capital Markets Group
301 South College Street
Charlotte, North Carolina 28288-0745
Eurodollar Lending Office:
Capital Markets Group
301 South College Street
Charlotte, North Carolina 28288-0745
<PAGE> 93
Lender:
Commitment: FLEET NATIONAL BANK
$20,000,000.00
By: /s/ MICHAEL S. BARCLAY
------------------------------
Name: Michael S. Barclay
------------------------------
Title: Vice President
------------------------------
Address for Notices:
One Federal Street
MAOFD07A
Boston, Massachusetts 02110
Telecopy No.: (617) 346-0151
Domestic Lending Office:
One Federal Street
MAOFD07A
Boston, Massachusetts 02110
Eurodollar Lending Office:
One Federal Street
MAOFD07A
Boston, Massachusetts 02110
<PAGE> 94
Lender:
Commitment: ISTITUTO BANCARIO SAN PAOLO DI TORINO -
$26,000,000.00 ISTITUTO MOBILARE ITALIANO S.P.A.
By: /s/ GLEN BINDER
---------------------------------
Name: Glen Binder
---------------------------------
Title: Vice President
---------------------------------
By: /s/ ROBERT WURSTER
---------------------------------
Name: Robert Wurster
---------------------------------
Title: First Vice President
---------------------------------
Address for Notices:
SanPalo IMI Bank SpA
245 Park Avenue
New York, New York 10167
Telecopy No.: (212) 692-3178
Domestic Lending Office:
245 Park Avenue
New York, New York 10167
Eurodollar Lending Office:
245 Park Avenue
New York, New York 10167
<PAGE> 95
Lender:
Commitment: KBC BANK N.V.
$26,000,000.00
By: /s/ ROBERT SNAUFFER
-------------------------------
Name: Robert Snauffer
-------------------------------
Title: First Vice President
-------------------------------
By: /s/ RAYMOND F. MURRAY
-------------------------------
Name: Raymond F. Murray
-------------------------------
Title: First Vice President
-------------------------------
Address for Notices:
Atlanta Representative Office
1349 West Peachtree Street
Suite 1750
Atlanta, Georgia 30309
Telecopy No.: (404) 876-3212
Domestic Lending Office:
125 West 55th Street
New York, New York 10019
Eurodollar Lending Office:
125 West 55th Street
New York, New York 10019
<PAGE> 96
Lender:
Commitment: MELLON BANK, N.A.
$20,000,000.00
By: /s/ PAUL F. NOEL
-------------------------------
Name: Paul F. Noel
-------------------------------
Title: Vice President
-------------------------------
Address for Notices:
One Mellon Bank Center
Room 4440
Pittsburgh, Pennsylvania 15258-0001
Telecopy No.: (412) 234-6375
Domestic Lending Office:
One Mellon Bank Center
Room 4440
Pittsburgh, Pennsylvania 15258-0001
Eurodollar Lending Office:
One Mellon Bank Center
Room 4440
Pittsburgh, Pennsylvania 15258-0001
<PAGE> 97
Lender:
Commitment: NATIONAL AUSTRALIA BANK LIMITED
$20,000,000.00 A.C.N. 004044937
By: /s/ WILLIAM SCHMID
------------------------------
Name: William Schmid
------------------------------
Title: Vice President
------------------------------
Address for Notices:
200 Park Avenue
34th Floor
New York, New York 10166
Telecopy No.: (212) 983-1969
Domestic Lending Office:
200 Park Avenue
34th Floor
New York, New York 10166
Eurodollar Lending Office:
200 Park Avenue
34th Floor
New York, New York 10166
<PAGE> 98
Lender:
Commitment: NATIONSBANK, NATIONAL ASSOCIATION
$30,000,000.00
By: /s/ TIMOTHY M. O'CONNOR
------------------------------
Name: Timothy M. O'Connor
------------------------------
Title: Vice President
------------------------------
Address for Notices:
901 Main Street, 67th Floor
Dallas, Texas 75202
Telecopy No.: (214) 209-9419
Domestic Lending Office:
901 Main Street
Dallas, Texas 75202
Attn: Geri Lewis (13th Floor)
Telecopy No.: (214) 209-0944
Eurodollar Lending Office:
901 Main Street
Dallas, Texas 75202
Attn: Geri Lewis (13th Floor)
Telecopy No.: (214) 209-0944
<PAGE> 99
Lender:
Commitment: STATE STREET BANK AND TRUST COMPANY
$20,000,000.00
By: /s/ MARK H. TRACHY
------------------------------
Name: Mark H. Trachy
------------------------------
Title: Vice President
------------------------------
Address for Notices:
High Technology Group
225 Franklin Street, MA012
Boston, Massachusetts 02110-2804
Telecopy No.: (617) 664-8807
Domestic Lending Office:
High Technology Group
225 Franklin Street, MA012
Boston, Massachusetts 02110-2804
Eurodollar Lending Office:
High Technology Group
225 Franklin Street, MA012
Boston, Massachusetts 02110-2804
<PAGE> 1
EXHIBIT 99.3
BMC SOFTWARE COMPLETES ACQUISITION OF NEW DIMENSION SOFTWARE
Company Completes Second Major Acquisition in Two Weeks; Prepares for
Kickoff of Fiscal 2000
HOUSTON, TX -- (April 14, 1999) -- Two weeks after completing its merger
with Boole & Babbage, BMC Software, Inc. (Nasdaq:BMCS), today completed its
acquisition of New Dimension Software Ltd. With the completion of these
acquisitions, BMC Software is positioned as the leader among top-tier
enterprise management vendors with its focus on rapid delivery of business
value. These two strategic moves create a new era for enterprise management
by providing customers around the world with the assurance that the
business-critical applications they rely on are available, recoverable and
perform around the clock.
"The addition of New Dimension Software and Boole & Babbage better
positions us as a strategic partner with our customers. As separate
companies, each was strong and considered an industry leader. Now, as one
company with one vision, BMC Software will be the one that customers trust
to lead them into the new millennium," said Max Watson, chairman, president
and CEO of BMC Software. "BMC Software has become the pre-eminent leader in
Information Technology enterprise management. We have reached this position
through internal development and growth as well as through strategic
acquisitions. Our acquisition strategy has been focused on companies that
are industry leaders and offer best-of-breed solutions. The addition of New
Dimension Software truly brings a new dimension to BMC Software's
application service assurance strategy."
Through the acquisition, BMC Software obtains a new center for technology
excellence in Tel Aviv, Israel, which is one of the world's epicenters for
technology innovation. In addition, the company's combined product line
will provide customers the ability to manage all components of the
enterprise which affect application availability and the ability to solve
unique application availability problems. Today, there already exists
tremendous synergies across customers and products lines. BMC Software will
leverage its distribution channels allowing customers to realize these
benefits:
o Across all major platforms (OS/390, UNIX, NT, Internet);
o Across databases, middleware, mail and messaging, custom and
packaged applications, Internet and Web servers;
o Across all major functional areas: event management, performance
analysis, capacity planning, backup and recovery, job scheduling,
output management and security administration.
The New Dimension Software transaction is a cash purchase valued at
approximately $675 million. BMC Software plans to have New Dimension
Software operate as a separate
<PAGE> 2
operating business unit. More details of the integration plans will be
announced following the company's kickoff of its fiscal year 2000 planned
for the end of April. With the completion of the New Dimension Software
transaction, BMC Software now employs approximately 5,000 people in 26
countries and has combined revenues during the last 12 months of
approximately $1.3 billion.
ABOUT BMC SOFTWARE BMC
Software is the world's leading provider of management solutions that
ensure the availability, performance, and recovery of companies'
business-critical applications. We call this application service assurance,
and it means that the applications you and your customers rely on most stay
up and running, around the clock. For more than 18 years, the world's
largest companies have relied on BMC Software. BMC Software is among the
world's largest independent software vendors, a Forbes 500 company and a
member of the S&P 500, with revenues during the previous 12 months of
approximately $1.3 billion. The company is headquartered in Houston, Texas,
with offices worldwide. For more information, visit our Web site at
www.bmc.com, or please call 800-841-2031 or 713-918-8800.
Media Relations Contacts: Investor Relations Contact:
BMC Software: BMC Software:
Dan D'Armond John Cox
(713) 918-2372 (713) 918-4291
dan_d'[email protected] [email protected]
Blanc & Otus: (For BMC Software)
Jim McManus
(617) 225-9990
[email protected]
