<PAGE> 1
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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): February 13, 1997
Medaphis Corporation
(Exact name of registrant as specified in its charter)
DELAWARE 000-19480 58-1651222
(State or other Commission File Number (IRS Employer
jurisdiction of incorporation) Identification Number)
2700 CUMBERLAND PARKWAY
SUITE 300
ATLANTA, GEORGIA 30339
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (770) 444-5300
NOT APPLICABLE
(Former Name or Former Address, if Changed Since Last Report)
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<PAGE> 2
Item 5. Other Events.
On February 20, 1998, the Registrant closed a long-term financing
package as previously announced by the Registrant. The $275 million financing
package consists of $175 million of 9 1/2 % Senior Notes due 2005 and a $100
million secured revolving credit facility. The net proceeds of the financing
package were used to refinance the Registrant's then-existing $210 million loan
facility, maturing in 1999, and for general corporate purposes.
The Revolving Credit Facility is guaranteed by the Registrant's
domestic subsidiaries and secured by a first-priority lien on substantially all
material assets of the Registrant and its domestic subsidiaries. The Senior
Notes are guaranteed by the Registrant's domestic subsidiaries.
The terms of the Revolving Credit Facility are set forth in the Credit
Agreement, dated as of February 13, 1998, among Medaphis Corporation, as the
Borrower, Various Financial Institutions from Time to Time Parties Thereto, as
the Lenders, DLJ Capital Funding, Inc., as the Syndication Agent for the Lenders
and Wachovia Bank, N.A., as the Administrative Agent for the Lenders (the
"Credit Agreement"). The Credit Agreement is filed as Exhibit 10.1 to this
Current Report on Form 8-K. The Subsidiary Guaranty, dated as of February 13,
1998, among the domestic subsidiaries of the Registrant and Wachovia Bank, N.A.,
as Administrative Agent, is filed as Exhibit 10.2 to this Current Report on Form
8-K.
The 9 1/2 % Senior Notes are issued under and subject to the terms of
an Indenture, dated as of February 20, 1998, among Medaphis Corporation, as
Issuer, the Subsidiary Guarantors named in the Indenture, and State Street Bank
and Trust Company, as Trustee (the "Indenture"). The Indenture is filed as
Exhibit 10.3 to this Current Report on Form 8-K.
In addition, the Registrant issued a press release on February 20,
1998, a copy of which is filed as Exhibit 99.1 to this Current Report on Form
8-K. The press release relates to the closing of the financing package.
<PAGE> 3
Item 7. Financial Statements and Exhibits.
(c) Exhibits
10.1 Credit Agreement, dated as of February 13, 1998,
among Medaphis Corporation, as the Borrower, Various
Financial Institutions from Time to Time Parties
Thereto, as the Lenders, DLJ Capital Funding, Inc.,
as the Syndication Agent for the Lenders, and
Wachovia Bank, N.A., as the Administrative Agent for
the Lenders (including form of note)
10.2 Subsidiary Guaranty, dated February 13, 1998, among
the domestic subsidiaries of the Registrant and
Wachovia Bank, N.A., as Administrative Agent
10.3 Indenture, dated as of February 20, 1998, among
Medaphis Corporation, as Issuer, the Subsidiary
Guarantors named in the Indenture, and State Street
Bank and Trust Company, as Trustee (including form
of note)
99.1 Press Release issued by the Registrant on February
20, 1998
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: March 2, 1998
MEDAPHIS CORPORATION
By: /s/ Allen W. Ritchie
----------------------------------
Allen W. Ritchie
Executive Vice President and
Chief Financial Officer
<PAGE> 4
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NUMBER
- --------------
<S> <C>
10.1 Credit Agreement, dated as of February 13, 1998, among Medaphis
Corporation, as the Borrower, Various Financial Institutions from Time
to Time Parties Thereto, as the Lenders, DLJ Capital Funding, Inc., as
the Syndication Agent for the Lenders, and Wachovia Bank, N.A., as the
Administrative Agent for the Lenders (including form of note).........................
10.2 Subsidiary Guaranty, dated February 13, 1998, among the domestic
subsidiaries of the Registrant and Wachovia Bank, N.A., as
Administrative Agent..................................................................
10.3 Indenture, dated as of February 20, 1998, among Medaphis Corporation,
as Issuer, the Subsidiary Guarantors named in the Indenture, and State
Street Bank and Trust Company, as Trustee (including form of note)....................
99.1 Press Release issued by the Registrant on February 20, 1998...........................
</TABLE>
<PAGE> 1
EXHIBIT 10.1
[Execution Copy]
U.S. $100,000,000
CREDIT AGREEMENT,
dated as of February 13, 1998
among
MEDAPHIS CORPORATION
as the Borrower,
VARIOUS FINANCIAL INSTITUTIONS FROM TIME TO TIME PARTIES HERETO,
as the Lenders,
DLJ CAPITAL FUNDING, INC.,
as the Syndication Agent for the Lenders
and
WACHOVIA BANK, N.A.,
as the Administrative Agent for the Lenders,
ARRANGED BY
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Section Page
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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
<S> <C> <C>
1.1. Defined Terms.......................................................................................1
1.2. Use of Defined Terms...............................................................................24
1.3. Cross-References...................................................................................24
1.4. Accounting and Financial Determinations............................................................24
ARTICLE II
COMMITMENTS, BORROWING AND ISSUANCE
PROCEDURES, NOTES AND LETTERS OF CREDIT
2.1. Commitments........................................................................................25
2.1.1. Revolving Loan Commitments.........................................................................25
2.1.2. Swing Line Loan Commitment.........................................................................25
2.1.3. Letter of Credit Commitment........................................................................25
2.1.4. Lenders Not Permitted or Required to Make Loans....................................................25
2.1.5. Issuer Not Permitted or Required to Issue Letters of Credit........................................26
2.2. Reduction of the Commitment Amount.................................................................26
2.3. Borrowing Procedures, etc..........................................................................26
2.3.1. Revolving Loans....................................................................................26
2.3.2. Swing Line Loans...................................................................................26
2.4. Continuation and Conversion Elections..............................................................28
2.5. Funding............................................................................................29
2.6. Issuance Procedures................................................................................29
2.6.1. Other Lenders' Participation.......................................................................29
2.6.2. Disbursements......................................................................................30
2.6.3. Reimbursement......................................................................................30
2.6.4. Deemed Disbursements...............................................................................30
2.6.5. Nature of Reimbursement Obligations................................................................31
2.7. Notes, etc.........................................................................................31
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
3.1. Repayments and Prepayments; Application............................................................31
3.1.1. Repayments and Prepayments.........................................................................31
3.1.2. Application........................................................................................34
3.2. Interest Provisions................................................................................35
3.2.1. Rates..............................................................................................35
</TABLE>
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<TABLE>
<CAPTION>
Section Page
- ------- ----
<S> <C> <C>
3.2.2. Post-Maturity Rates................................................................................35
3.2.3. Payment Dates......................................................................................35
3.3. Fees...............................................................................................35
3.3.1. Commitment Fee.....................................................................................36
3.3.2. Agent's Fee........................................................................................36
3.3.3. Letter of Credit Fee...............................................................................36
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
4.1. LIBO Rate Lending Unlawful.........................................................................36
4.2. Deposits Unavailable...............................................................................37
4.3. Increased LIBO Rate Loan Costs, etc................................................................37
4.4. Funding Losses.....................................................................................37
4.5. Increased Capital Costs............................................................................38
4.6. Taxes..............................................................................................38
4.7. Payments, Computations, etc........................................................................40
4.8. Sharing of Payments................................................................................40
4.9. Setoff.............................................................................................40
4.10. Replacement of Lenders.............................................................................41
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
5.1. Initial Credit Extension...........................................................................41
5.1.1. Resolutions, etc...................................................................................42
5.1.2. Closing Date Certificate...........................................................................42
5.1.3. Delivery of Notes..................................................................................42
5.1.4. Pledge Agreement...................................................................................42
5.1.5. Subsidiary Guaranty................................................................................43
5.1.6. Security Agreement.................................................................................43
5.1.7. Copyright Security Agreement and Trademark Security Agreement......................................44
5.1.8. Financial Information, etc.........................................................................44
5.1.9. Compliance Certificate.............................................................................44
5.1.10. Purchase and Sale of Senior Notes, etc. ...........................................................44
5.1.11. Perfection Certificate.............................................................................44
5.1.12. Payment of Outstanding Indebtedness, etc...........................................................44
5.1.13. Litigation.........................................................................................44
5.1.14. Material Adverse Change............................................................................45
5.1.15. Approvals..........................................................................................45
5.1.16. Insurance..........................................................................................45
5.1.17. Opinions of Counsel................................................................................45
5.1.18. Other Representations and Warranties...............................................................45
</TABLE>
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<TABLE>
<CAPTION>
Section Page
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<S> <C> <C>
5.1.19. Closing Fees, Expenses, etc........................................................................45
5.2. All Credit Extensions..............................................................................45
5.2.1. Compliance with Warranties, No Default, etc........................................................45
5.2.2. Credit Extension Request, etc......................................................................46
5.2.3. Satisfactory Legal Form............................................................................46
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1. Corporate Existence and Power......................................................................46
6.2. Authorization, Execution and Enforceability; Lien Perfection.......................................47
6.3. Governmental Authorization.........................................................................47
6.4. Contravention......................................................................................47
6.5. Financial Information, etc.........................................................................47
6.6. Litigation.........................................................................................48
6.7. Taxes..............................................................................................48
6.8. Subsidiaries.......................................................................................48
6.9. Not a Regulated Entity.............................................................................48
6.10. Full Disclosure....................................................................................48
6.11. Permits............................................................................................49
6.12. Real Property Interests............................................................................49
6.13. Compliance with ERISA..............................................................................49
6.14. Ownership of Properties............................................................................49
6.15. Environmental Warranties...........................................................................49
6.16. Intellectual Property..............................................................................51
6.17. Regulations G, U and X.............................................................................51
ARTICLE VII
COVENANTS
7.1. Affirmative Covenants..............................................................................51
7.1.1. Financial Information, Reports, Notices, etc.......................................................51
7.1.2. Maintenance of Properties..........................................................................54
7.1.3. Payment of Obligations.............................................................................54
7.1.4. Insurance..........................................................................................54
7.1.5. Conduct of Business and Maintenance of Existence...................................................54
7.1.6. Compliance with Laws...............................................................................54
7.1.7. Inspection of Property, Books and Records..........................................................54
7.1.8. Subsidiaries.......................................................................................55
7.1.9. Future Subsidiaries................................................................................55
7.1.10. Use of Proceeds....................................................................................55
7.2. Negative Covenants.................................................................................56
7.2.1. Business Activities................................................................................56
</TABLE>
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<PAGE> 5
<TABLE>
<CAPTION>
Section Page
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<S> <C> <C>
7.2.2. Indebtedness.......................................................................................56
7.2.3. Liens..............................................................................................57
7.2.4. Financial Covenants................................................................................59
7.2.5. Investments........................................................................................61
7.2.6. Restricted Payments, etc...........................................................................62
7.2.7. Capital Expenditures, etc..........................................................................62
7.2.8. Cash Settlement Payments...........................................................................63
7.2.9. Transactions with Affiliates.......................................................................63
7.2.10. Consolidations and Mergers.........................................................................63
7.2.11. Stock of Subsidiaries..............................................................................64
7.2.12. Permitted Dispositions.............................................................................64
7.2.13. Modification of Certain Agreements.................................................................64
7.2.14. Restrictive Agreements, etc........................................................................64
7.2.15. Sale and Leaseback.................................................................................65
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Listing of Events of Default.......................................................................65
8.1.1. Non-Payment of Obligations.........................................................................65
8.1.2. Breach of Warranty.................................................................................65
8.1.3. Non-Performance of Certain Covenants and Obligations...............................................65
8.1.4. Non-Performance of Other Covenants and Obligations.................................................65
8.1.5. Default on Other Indebtedness......................................................................65
8.1.6. Judgments, etc.....................................................................................66
8.1.7. Pension Plans......................................................................................66
8.1.8. Change in Control..................................................................................66
8.1.9. Bankruptcy, Insolvency, etc........................................................................66
8.1.10. Impairment of Security or Collateral, etc..........................................................67
8.2. Action if Bankruptcy...............................................................................67
8.3. Action if Other Event of Default...................................................................67
ARTICLE IX
THE AGENTS
9.1. Actions............................................................................................67
9.2. Funding Reliance, etc..............................................................................68
9.3. Exculpation........................................................................................68
9.4. Successor..........................................................................................68
9.5. Credit Extensions by each Agent....................................................................69
9.6. Credit Decisions...................................................................................69
9.7. Copies, etc........................................................................................70
9.8. The Swing Line Lender, the Issuer, the Syndication
</TABLE>
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<PAGE> 6
<TABLE>
<S> <C> <C>
Agent and the Administrative Agent...............................................................70
ARTICLE X
MISCELLANEOUS PROVISIONS
10.1. Waivers, Amendments, etc...........................................................................70
10.2. Notices............................................................................................71
10.3. Payment of Costs and Expenses......................................................................71
10.4. Indemnification....................................................................................72
10.5. Survival...........................................................................................73
10.6. Severability.......................................................................................73
10.7. Headings...........................................................................................73
10.8. Execution in Counterparts, Effectiveness, etc......................................................74
10.9. Governing Law; Entire Agreement....................................................................74
10.10. Successors and Assigns.............................................................................74
10.11. Sale and Transfer of Loans and Notes; Participations in Loans and Notes............................74
10.11.1. Assignments........................................................................................74
10.11.2. Participations.....................................................................................76
10.12. Other Transactions.................................................................................77
10.13. Confidentiality....................................................................................77
10.14. Forum Selection and Consent to Jurisdiction........................................................78
10.15. Waiver of Jury Trial...............................................................................78
10.16. Termination........................................................................................79
</TABLE>
SCHEDULE I - Disclosure Schedule
SCHEDULE II - Notice Information
EXHIBIT A-1 - Form of Revolving Note
EXHIBIT A-2 - Form of Swing Line Note
EXHIBIT B-1 - Form of Borrowing Request
EXHIBIT B-2 - Form of Issuance Request
EXHIBIT B-3 - Form of Borrowing Base Certificate
EXHIBIT C - Form of Continuation/Conversion Notice
EXHIBIT D - Form of Closing Date Certificate
EXHIBIT E-1 - Form of Compliance Certificate
EXHIBIT E-2 - Form of Preliminary Compliance Certificate
EXHIBIT F - Form of Security Agreement
EXHIBIT G - Form of Pledge Agreement
EXHIBIT H - Form of Subsidiary Guaranty
EXHIBIT I - Form of Perfection Certificate
EXHIBIT J - Form of Lender Assignment Agreement
EXHIBIT K - Form of Opinion of Counsel to the Obligors
EXHIBIT L - Form of Swing Line Account Agreement
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<PAGE> 7
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of February 13, 1998, is among
MEDAPHIS CORPORATION, a Delaware corporation (the "Borrower"), the various
financial institutions from time to time parties hereto (the "Lenders"), DLJ
CAPITAL FUNDING, INC. ("DLJ"), as syndication agent (the "Syndication Agent")
for the Lenders, and WACHOVIA BANK, N.A. ("Wachovia") as administrative agent
(the "Administrative Agent") for the Lenders (the Syndication Agent and the
Administrative Agent are sometimes referred to herein as the "Agents" and each
as an "Agent").
W I T N E S S E T H:
WHEREAS, the Borrower is engaged, directly and indirectly through its
various Subsidiaries (such capitalized term, and other terms used herein, to
have the meanings provided in Section 1.1), in the business of providing
healthcare information products, healthcare business management services and
enabling technologies in selected industries, all as more fully described in
the Borrower's 10-K for its 1997 Fiscal Year;
WHEREAS, the Borrower desires to obtain Commitments from the Lenders
and the Issuer pursuant to which Loans and Letters of Credit, in a maximum
aggregate principal amount (including the aggregate principal amount of Swing
Line Loans and Letter of Credit Outstandings) at any one time outstanding not
to exceed $100,000,000, will be made from time to time to the Borrower prior to
the Commitment Termination Date; and
WHEREAS, the Lenders and the Issuer are willing, on the terms and
subject to the conditions hereinafter set forth, to extend the Commitments and
make Loans to the Borrower and issue (or participate in) Letters of Credit;
NOW, THEREFORE, the parties hereto agree as follows.
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):
"Account" means (i) any account (as that term is defined in Section
9-106 of the UCC) of the Borrower or any Guarantor arising from the sale or
lease of goods or the rendering of services by the Borrower or any Guarantor in
the ordinary course of business and (ii) amounts receivable, not to exceed
$300,000 at any time outstanding, from Envoy-NEIC to the Borrower or any
Guarantor representing rebates on fees paid or payable.
<PAGE> 8
"Additional Compensation Amount" means, at any time of determination
and with respect to any Lender (other than the Swing Line Lender), such
Lender's Percentage of (i) a per annum rate equal to the positive difference,
if any, between (x) the then Applicable Margin for Base Rate Loans and (y)
0.50%, multiplied by (ii) the daily average outstanding balance of all Swing
Line Loans for the period from (and including) the day following the fifth
consecutive Business Day on which Swing Line Loans in excess of $1,000,000 have
remained outstanding to (but excluding) the Refunding Date. The Additional
Compensation Amount shall be calculated on the basis of a year comprised of 365
or 366 days (as applicable) for the actual number of days elapsed.
"Administrative Agent" is defined in the preamble and includes each
other Person appointed as the successor Administrative Agent pursuant to
Section 9.4.
"Affected Lender" is defined in Section 4.10.
"Affiliate" of any Person means any other Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person. "Control" of a Person means the power, directly or indirectly, (i) to
vote 25% or more of the securities (on a fully diluted basis) having ordinary
voting power for the election (as applicable) of directors, managing members or
general partners, or (ii) to direct or cause the direction of the management
and policies of such Person (whether by contract or otherwise); provided, that
in no event shall any Agent or Lender or any of their Affiliates be deemed an
Affiliate of the Borrower for purposes hereof or any other Loan Document.
"Agent" and "Agents" are defined in the preamble.
"Agreement" means, on any date, this Credit Agreement as originally in
effect on the Effective Date and as thereafter from time to time amended,
supplemented, amended and restated, or otherwise modified and in effect on such
date.
"Alternate Base Rate" means, on any date and with respect to all Base
Rate Loans, a fluctuating rate of interest per annum (rounded upward, if
necessary, to the next highest 1/16 of 1%) equal to the higher of (x) the Base
Rate in effect on such day, and (y) the Federal Funds Rate in effect on such
day plus 1/2 of 1%. Changes in the rate of interest on that portion of any
Loans maintained as Base Rate Loans will take effect simultaneously with each
change in the Alternate Base Rate. The Administrative Agent will give notice
promptly to the Borrower and the Lenders of changes in the Alternate Base Rate;
provided, that the failure to give such notice shall not affect the Alternate
Base Rate in effect after such change.
"Applicable Commitment Fee" means, subject to the proviso hereto, at
all times during the applicable periods set forth below with respect to the
commitment fee payable to the Lenders pursuant to Section 3.3.1, (i) from the
Effective Date through (and including) the six-month anniversary of the
Effective Date 0.50% per annum and (ii) thereafter, at the applicable
percentage per annum set forth below under the column entitled "Applicable
Commitment Fee":
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<TABLE>
<CAPTION>
Applicable
Leverage Ratio Commitment Fee
---------------- ----------------
<S> <C>
greater than or
equal to 2.5:1 0.500%
greater than or
equal to 2.0:1 and
less than 2.5:1 0.375%
less than 2.0:1 0.250%
</TABLE>
provided, however, that, the commitment fee payable on (but only on) the Excess
Portion of the Revolving Loan Commitment Amount pursuant to Section 3.3.1 shall
be (i) 0.75% per annum from the Effective Date through (and including) the
six-month anniversary of the Effective Date, and (ii) thereafter, at the
applicable percentage per annum set forth below under the column entitled
"Excess Portion Applicable Commitment Fee":
<TABLE>
<CAPTION>
Excess Portion
Applicable
Leverage Ratio Commitment Fee
-------------- --------------
<S> <C>
greater than or
equal to 2.5:1 0.750%
greater than or
equal to 2.0:1 and
less than 2.5:1 0.625%
less than 2.0:1 0.500%
</TABLE>
The Leverage Ratio used to compute the Applicable Commitment Fee shall
be that set forth in the Compliance Certificate most recently delivered by the
Borrower to the Administrative Agent. Changes in the Applicable Commitment Fee
resulting from a change in the Leverage Ratio shall become effective two
Business Days after delivery by the Borrower to the Administrative Agent of a
new Compliance Certificate pursuant to clause (c) of Section 7.1.1. If the
Borrower shall fail to deliver a Compliance Certificate within 45 days after
the end of any Fiscal Quarter (or within 90 days, in the case of the last
Fiscal Quarter of the Fiscal Year), the Applicable Commitment Fee from and
including the 46th (or 91st, as the case may be) day after the end of such
Fiscal Quarter to but not including the date the Borrower delivers to the
Administrative Agent a Compliance Certificate shall conclusively equal the
highest Applicable Commitment Fee set forth above until such time as a
Compliance Certificate is delivered.
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<PAGE> 10
"Applicable Margin" means at all times during the applicable periods
set forth below:
(a) with respect to the unpaid principal amount of each Loan
maintained as a Base Rate Loan, (i) from the Effective Date through
(and including) the six-month anniversary of the Effective Date, 1.5%
per annum, and (ii) thereafter, at the applicable percentage per annum
set forth below under the column entitled "Applicable Margin for Base
Rate Loans"; and
(b) with respect to the unpaid principal amount of each Loan
maintained as a LIBO Rate Loan, (i) from the Effective Date through
(and including) the six-month anniversary of the Effective Date, 2.5%
per annum, and (ii) thereafter, at the applicable percentage per annum
set forth below under the column entitled "Applicable Margin for LIBO
Rate Loans":
<TABLE>
<CAPTION>
Applicable Margin For Applicable Margin For
Leverage Ratio Base Rate Loans LIBO Rate Loans
- ------------------------------------ --------------------------------- -------------------------------
<S> <C> <C>
greater than 3.75:1 1.75% 2.75%
less than or equal to 3.75:1
and greater than 3.0:1 1.50% 2.50%
less than or equal to 3.0:1
and greater than 2.5:1 1.25% 2.25%
less than or equal to 2.50:1
and greater than 2.00:1 0.75% 1.75%
less than or equal to 2.00:1
and greater than 1.50:1 0.25% 1.25%
less than or equal to 1.50:1 0.00% 1.00%
</TABLE>
The Leverage Ratio used to compute the Applicable Margin following the
Effective Date shall be the Leverage Ratio set forth in the Compliance
Certificate most recently delivered by the Borrower to the Administrative
Agent. Changes in the Applicable Margin resulting from a change in the Leverage
Ratio shall become effective two Business Days after delivery by the Borrower
to the Administrative Agent of a new Compliance Certificate pursuant to clause
(c) of Section 7.1.1. If the Borrower shall fail to deliver a Compliance
Certificate within 45 days after the end of any Fiscal Quarter (or within 90
days, in the case of the last Fiscal Quarter of the Fiscal Year), the
Applicable Margin from and including the 46th (or 91st, as the case may be) day
after the end of such Fiscal Quarter to but not including the date the Borrower
delivers to the Administrative Agent a Compliance Certificate shall
conclusively equal the highest Applicable Margin set forth above until such
time as a Compliance Certificate is delivered.
"Arranger" means Donaldson, Lufkin & Jenrette Securities Corporation,
a Delaware corporation.
"Assignee Lender" means each Person described in either clause (a) or
(b) of Section 10.11.1 to whom any assignment and delegation referred to in
such Section is to be made.
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<PAGE> 11
"Authorized Officer" means, relative to any Obligor, those of its
officers, general parties or managing members (as applicable) whose signatures
and incumbency shall have been certified to the Administrative Agent, the
Lenders and the Issuers pursuant to Section 5.1.1 or who are authorized to act
on behalf of such Obligor in respect of the Loan Documents pursuant to
certified resolutions of the Board of Directors of such Obligor delivered to
the Administrative Agent pursuant to
Section 5.1.1 or at any time thereafter.
"Base Rate" means, at any time, the rate of interest then most
recently established or announced by the Administrative Agent in Atlanta,
Georgia as its prime rate for U.S. dollars loaned in the United States. The
Base Rate is not necessarily intended to be the lowest rate of interest
determined by the Administrative Agent in connection with extensions of credit.
"Base Rate Loan" means a Loan bearing interest at a fluctuating rate
determined by reference to the Alternate Base Rate.
"Benefit Arrangement" means at any time an employee benefit plan
within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.
"Borrower" is defined in the preamble.
"Borrower Collateral Document" means the Pledge Agreement or the
Security Agreement in each case as amended, supplemented or otherwise modified.
"Borrowing" means the making of Loans of the same type and, in the
case of LIBO Rate Loans, having the same Interest Period, made by all Lenders
required to make such Loans on the same Business Day and pursuant to the same
Borrowing Request in accordance with Section 2.1.
"Borrowing Base Amount" means, at any time, the Net Asset Value of all
Eligible Accounts and Unbilled Eligible Accounts at such time as determined in
accordance with the definition of "Net Asset Value" and as certified by the
Borrower in the most recently delivered Borrowing Base Certificate, including
the Borrowing Base Certificate delivered pursuant to clause (b) of Section
5.1.8.
"Borrowing Base Certificate" means a certificate duly completed and
executed by the president, chief executive officer, treasurer, assistant
treasurer, controller or chief financial Authorized Officer of the Borrower,
substantially in the form of Exhibit B-3 hereto.
"Borrowing Request" means a Loan request and certificate duly executed
by an Authorized Officer of the Borrower, substantially in the form of Exhibit
B-1 hereto.
"Bridge Note Agreement" means the Note Purchase Agreement, dated as of
December 23, 1997, among the Borrower, certain of its Subsidiaries and MED
Funding Inc., as amended.
"Bridge Notes" means the Senior Secured Increasing Rate Notes issued
by the Borrower pursuant to the Bridge Note Agreement.
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<PAGE> 12
"BSG Government Solutions Entity" means BSG Government Solutions,
Inc., a wholly-owned Subsidiary of the Borrower and each other Subsidiary of
the Borrower as to which at least 80% of its revenues are generated from
business with Governmental Authorities.
"Business Day" means (i) any day which is neither a Saturday or Sunday
nor a legal holiday on which banks are authorized or required to be closed in
New York, New York or Atlanta, Georgia, and (ii) relative to the making,
continuing, prepaying or repaying of any LIBO Rate Loans, any day which is a
Business Day described in clause (i) above and which is also a day on which
dealings in Dollars are carried on in the interbank eurodollar market of the
Administrative Agent's LIBOR Office.
"Capital Expenditures" means, for any period, the aggregate amount of
all expenditures of the Borrower and its Subsidiaries for fixed or capital
assets made during such period which, in accordance with GAAP, would be
classified as capital expenditures.
"Capital Lease" means any lease of property, real or personal, in
respect of which the obligations of the lessee thereunder are required in
accordance with GAAP to be capitalized on a balance sheet of such lessee.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equity equivalents (however designated,
whether voting or non-voting) of such Person's capital, whether now or
hereafter outstanding or issued.
"Capitalized Lease Liabilities" means all monetary obligations of the
Borrower or any of its Subsidiaries under any Capital Lease. For purposes of
each Loan Document the amount of such obligations shall be the capitalized
amount thereof, determined in accordance with GAAP, and the stated maturity
thereof shall be the date of the last payment of rent or any other amount due
under such Capital Lease prior to the first date upon which such lease expires
or may be terminated by the lessee without payment of a premium or a penalty.
"Cash Equivalent Investment" means, at any time, (i) securities issued
or directly and fully guaranteed or insured by the United States of America or
any agency or instrumentality thereof (provided that the full faith and credit
of the United States of America is pledged in support thereof), (ii) time
deposits and certificates of deposit of any domestic commercial bank (including
a domestic branch of a foreign bank) whose outstanding senior long-term debt
securities are rated either A- or higher by S&P or A3 or higher by Moody's,
(iii) repurchase obligations with a term of not more than 30 days for
underlying securities of the types described in clause (i) entered into with
any bank meeting the qualifications specified in clause (ii) above, (iv)
commercial paper rated at least A-1 or the equivalent thereof by S&P or at
least P-1 or the equivalent thereof by Moody's, maturing within one year after
the date of acquisition, (v) obligations denominated in a currency other than
dollars which are of a credit quality and maturity comparable to those referred
to in clauses (i) through (iv) above that are customarily used for short-term
investment of excess cash in the markets in which the Borrower and its
Subsidiaries operate, and (vi) shares of a money market mutual fund
substantially all of whose investments are described in clauses (i) through
(iv) above.
"Cash Management Agreements" means any agreement entered into from
time to time between the Borrower or any of its Subsidiaries, on the one hand,
and Wachovia Bank, N.A. or any of its Affiliates or any other banking or
financial institution, on the other hand, in connection with cash management
services for operating, collection, payroll and trust accounts of the Borrower
or its Subsidiaries provided by such banking
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<PAGE> 13
or financial institution, including, without limitation, automatic clearing
house services, control disbursement services, electronic funds transfer
services, information reporting services, lockbox services, stop payment
services, and wire transfer services.
"Cash Management Services Obligations" means any and all obligations
of the Borrower or any its Subsidiaries under any of the Cash Management
Agreements or otherwise relating to any cash management services.
"Casualty Event" means the damage, destruction or condemnation, as the
case may be, of any property of the Borrower or any Guarantor.
"Casualty Proceeds" means, with respect to any Casualty Event, the
amount of any insurance proceeds or condemnation awards received by the
Borrower or any of its Subsidiaries in connection therewith, but excluding any
proceeds or awards required to be paid to a creditor (other than the Lenders)
which holds a first-priority Lien permitted by Section 7.2.3 on the property
which is the subject of such Casualty Event.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
Liability Information System List.
"Change of Control" means such time as (a) any "person" or group
(within the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act of 1934,
as amended) shall become the beneficial owner, by way of merger, consolidation
or otherwise, of 35% or more of the voting power of all classes of voting
securities of the Borrower; or (b) a sale or transfer of all or substantially
all of the assets of the Borrower to any such person or group has been
consummated.
"Closing Date Certificate" means the closing date certificate executed
and delivered by an Authorized Officer of the Borrower pursuant to Section
5.1.2, substantially in the form of Exhibit D hereto.
"Code" means the Internal Revenue Code of 1986, and the regulations
thereunder, in each case as amended, reformed or otherwise modified from time
to time.
"Collateral" means all assets of the Borrower and the Guarantors
purported to be secured by Liens pursuant to the Loan Documents.
"Collateral Document" means, as the context may require, any Borrower
Collateral Document, any Subsidiary Collateral Document, any Copyright Security
Agreement or any Trademark Security Agreement.
"Commitment" means, as the context may require (i) a Lender's
Revolving Loan Commitment or Letter of Credit Commitment or (ii) the Swing Line
Lender's Swing Line Loan Commitment.
"Commitment Amount" means, as the context may require, the Revolving
Loan Commitment Amount, the Letter of Credit Commitment Amount or the Swing
Line Loan Commitment Amount.
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<PAGE> 14
"Commitment Letter" means the commitment letter, dated January 23,
1998, from DLJ and the Arranger to the Borrower.
"Commitment Termination Date" means the earliest of (i) the date on
which the Commitment Amount is terminated in full or reduced to zero pursuant
to Section 2.2, (ii) the Stated Maturity Date and (iii) the date on which any
Commitment Termination Event occurs. Upon the occurrence of any event described
above, all Commitments shall terminate automatically and without any further
action.
"Commitment Termination Event" means (i) the occurrence of any Event
of Default described in Section 8.1.9, or (ii) the occurrence and continuance
of any other Event of Default and either (x) the declaration of all or any
portion of the Loans or Letters of Credit Outstandings to be due and payable
pursuant to Section 8.3, or (y) the giving of notice by the Administrative
Agent, acting at the direction of the Required Lenders, to the Borrower that
the Commitments have been terminated.
"Compliance Certificate" means a certificate duly completed and
executed by an Authorized Officer of the Borrower, substantially in the form of
Exhibit E-1 hereto, together with such changes thereto as may be agreed upon
from time to time by the Administrative Agent and the Borrower.
"Contingent Liability" means any agreement, undertaking or arrangement
by which any Person guarantees, endorses or otherwise becomes or is
contingently liable upon (by direct or indirect agreement, contingent or
otherwise, to provide funds for payment, to supply funds to, or otherwise to
invest in, a debtor, or otherwise to assure a creditor against loss) the
Indebtedness of any other Person (other than by endorsements of instruments in
the course of collection), or guarantees the payment of dividends or other
distributions upon the shares of any other Person. The amount of any Person's
obligation under any Contingent Liability shall (subject to any limitation set
forth therein) be deemed to be the outstanding principal amount of the debt,
obligation or other liability guaranteed thereby; provided that if such
principal amount or guaranteed portion thereof is not stated or determinable,
the amount thereof shall be deemed to be such Person's maximum reasonably
anticipated liability in respect thereof as determined by such Person in good
faith.
"Continuation/Conversion Notice" means a notice of continuation or
conversion notice and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of Exhibit C hereto.
"Controlled Group" means all members of a controlled group of
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with the
Borrower, are treated as a single employer under Section 414(b) or 414(c) of
the Code or Section 4001 of ERISA.
"Conversion Account" means an Account which has arisen out of the
Borrower's Healthcare Services Business and has resulted from the conversion of
the billing arrangement for such Account from a contingent fee billing basis to
a fee for services billed basis.
"Copyright Security Agreement" means any Copyright Security Agreement
executed and delivered by any Obligor in substantially the form of Exhibit C to
any Security Agreement, as amended, supplemented, amended and restated or
otherwise modified.
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<PAGE> 15
"Credit Extension" means, as the context may require, (i) the making
of a Loan by a Lender or (ii) the issuance of any Letter of Credit, or the
extension of any Stated Expiry Date of any existing Letter of Credit, by an
Issuer.
"Credit Extension Request" means, as the context may require, any
Borrowing Request or Issuance Request.
"DLJ" is defined in the preamble.
"Default" means any Event of Default or any condition, occurrence or
event which, after notice or lapse of time or both, would constitute an Event
of Default.
"Disbursement" is defined in Section 2.6.2.
"Disbursement Date" is defined in Section 2.6.2.
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
Schedule I, as it may be amended, supplemented, amended and restated or
otherwise modified from time to time by the Borrower with the written consent
of the Required Lenders.
"Dollar" and the sign "$" mean lawful money of the United States.
"Domestic Office" means, relative to any Lender, the office of such
Lender designated as such Lender's "Domestic Office" set forth opposite its
name on Schedule II hereto or in a Lender Assignment Agreement, or such other
office of a Lender (or any successor or assign of such Lender) within the
United States as may be designated from time to time by notice from such
Lender, as the case may be, to each other Person party hereto.
"EBITDA" means, for the Borrower and its Subsidiaries, for any
applicable period, the sum (without duplication) of
(a) Net Income,
plus
(b) Interest Expense of the Borrower and its Subsidiaries,
plus
(c) the amount deducted, in determining Net Income, of all
federal, state and local taxes (whether paid in cash or deferred) of
the Borrower and its Subsidiaries,
plus
(d) the amount deducted, in determining Net Income,
representing depreciation of assets of the Borrower and its
Subsidiaries,
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<PAGE> 16
plus
(e) the amount deducted in determining Net Income,
representing amortization of intangible assets of the Borrower and its
Subsidiaries,
(f) the aggregate amount deducted in determining Net Income
representing net losses realized in connection with the sale or other
disposition of assets by the Borrower and its Subsidiaries,
plus
(g) the amount deducted in determining Net Income
representing non-cash charges and expenses and other non-cash items
during such period (including any non-cash write-off of deferred
financing fees in respect of the Bridge Notes and the non-cash
cumulative effect of any change in GAAP),
plus
(h) with respect to any applicable period which includes a
1997 Fiscal Quarter, amounts, not to exceed $93.1 million in the
aggregate, deducted in determining Net Income representing
restructuring and other extraordinary and unusual charges incurred
during Fiscal Year 1997.
"Effective Date" means the date this Agreement becomes effective
pursuant to Section 10.8.
"Eligible Account" means, with respect to the Borrower or any
Guarantor, any Account as to which each of the following requirements has been
fulfilled:
(a) the Borrower or such Guarantor owns such Account free and
clear of all Liens other than any Lien permitted to exist under clause
(a), (b), (d) or (e) of Section 7.2.3;
(b) such Account is a legal, valid, binding and enforceable
obligation of the Person obligated under such Account (the "Account
Debtor");
(c) such Account is not subject to any bona fide asserted
dispute, setoff, counterclaim or other right, claim or defense on the
part of the Account Debtor or any other Person denying liability under
such Account;
(d) the Borrower or such Guarantor has, after giving effect
to any applicable provision of the UCC, the full and unqualified right
to grant a Lien on such Account for the benefit of the Secured
Parties, as security for the Obligations (and the Administrative Agent
shall, subject to Liens described in clause (a) above, have a
perfected, first-priority Lien on such Account);
(e) such Account is evidenced by an invoice rendered to the
Account Debtor (which shall include computer records) or is reflected
by computer records maintained by the Borrower or such Guarantor
evidencing such Account and is not evidenced by any instrument or
chattel paper (as the
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<PAGE> 17
terms "instrument" and "chattel paper" are defined in Section 9-105 of
the UCC), unless such instrument or chattel paper has been delivered
to the Administrative Agent;
(f) with respect to any such Account, (i) the Account Debtor
is not an Affiliate of the Borrower or any Guarantor, other than a
Joint Venture if such Account has arisen in a transaction which
complies with Section 7.2.9 hereof, or (ii) the Account Debtor is not
the subject of any reorganization, bankruptcy, receivership,
custodianship, insolvency or other condition analogous thereto, unless
(x) such Account has been given administrative expense status
(constituting a first priority claim) in bankruptcy and will be paid
in the ordinary course of business in accordance with the terms
thereof, or (y) the Administrative Agent has not notified the Borrower
in writing that such Account is an unacceptable collection risk;
(g) such Account is not outstanding more than 120 days from
the original invoice date for such Account;
(h) such Account is not an Account owing by an Account Debtor
having, at the time of any determination of Eligible Accounts, in
excess of 10% of the aggregate outstanding amount of all Accounts of
such Account Debtor (other than (x) Accounts arising in connection
with systems integration services, development of custom applications,
software installations or hardware resales or (y) Conversion Accounts)
outstanding more than 120 days past the original invoice date for such
Account; and
(i) the Account Debtor in respect of such Account is located
within the United States, unless the obligations (or that portion of
such obligations which is acceptable to the Administrative Agent) of
an Account Debtor not located within the United States are secured by
a letter of credit, guaranty or eligible bankers' acceptance having
terms, and from such issuers and confirmation banks, as are reasonably
acceptable to the Administrative Agent.
"Environmental Laws" means all applicable federal, state or local
statutes, laws, ordinances, codes, rules, regulations and guidelines (including
consent decrees and administrative orders) relating to or imposing liability or
standards of conduct concerning public health and safety and protection of the
environment, all as amended from time to time.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to sections of ERISA also refer to any successor sections thereto.
"ERISA Group" means the Borrower, any of its Subsidiaries and all
members of a controlled group of corporations and all trades or businesses
(whether or not incorporated) under common control which, together with the
Company or any Subsidiary, are treated as a single employer under Section 414
of the Internal Revenue Code.
"Excess Portion" means, with respect to the Revolving Loan Commitment
Amount, at any time of determination, the positive excess, if any, of
$50,000,000 over the sum of (x) the aggregate outstanding principal amount of
all Revolving Loans and (y) the aggregate outstanding amount of all Letter of
Credit Outstandings.
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"Event of Default" is defined in Section 8.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excluded Disposition" is defined in Section 7.2.12.
"Federal Funds Rate" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to (i) the weighted
average of the rates on overnight federal funds transactions with members of
the Federal Reserve System arranged by federal funds brokers, as published for
such day (or, if such day is not a Business Day, for the next preceding
Business Day) by the Federal Reserve Bank of New York, or (ii) if such rate is
not so published for any day which is a Business Day, the average of the
quotations for such day on such transactions received by the Administrative
Agent from three federal funds brokers of recognized standing selected by it.
"Fee Letter" means (i) the confidential letter, dated January 23,
1998, from DLJ and the Arranger to the Borrower or (ii) the confidential
letter, dated February 11, 1998, from Wachovia to the Borrower.
"Fiscal Quarter" means a quarter ending on the last day of March,
June, September or December.
"Fiscal Year" means any period of twelve consecutive calendar months
ending on December 31; references to a Fiscal Year with a number corresponding
to any calendar year (e.g., the "1998 Fiscal Year") refer to the Fiscal Year
ending on December 31 of such calendar year.
"Foreign Subsidiary" means any Subsidiary that is not a U.S. Subsidiary
"F.R.S. Board" means the Board of Governors of the Federal Reserve
System or any successor thereto.
"GAAP" is defined in Section 1.4.
"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.
"Guarantor" means each direct or indirect U.S. Subsidiary of the
Borrower other than (i) any Subsidiary which is designated with an asterisk
appearing after its name on Item 6.8 of the Disclosure Schedule; provided, such
Subsidiary (x) has been dissolved within 30 days of the Effective Date or (y)
has revenues of $100,000 or less per Fiscal Year, and (ii) any such Subsidiary
which is a Joint Venture.
"Hazardous Material" means (i) any "hazardous substance", as defined
by CERCLA, (ii) any "hazardous waste", as defined by the Resource Conservation
and Recovery Act, as amended, or (iii) any pollutant or contaminant or
hazardous, dangerous or toxic chemical, material or substance (including any
petroleum product) within the meaning of any other applicable Environmental
Law.
"Healthcare Services Business" means the business sector of the
Borrower and its Subsidiaries providing management services to physicians and
hospitals which, as of the Effective Date, is known as the
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<PAGE> 19
Borrower's "Healthcare Services Group", but excluding any services of a
different type being provided by the Borrower's Per Se Technologies sector as
of such date.
"Hedging Obligations" of any Person means all obligations of such
Person in respect of any swap transaction, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency
option or any other similar transaction (including any option with respect to
any of the foregoing transactions) or any combination of the foregoing
transactions.
"herein", "hereof", "hereto", "hereunder" and similar terms contained
in this Agreement or any other Loan Document refer to this Agreement or such
other Loan Document, as the case may be, as a whole and not to any particular
Section, paragraph or provision of this Agreement or such other Loan Document.
"including" and "include" means including without limiting the
generality of any description preceding such term, and, for purposes of this
Agreement and each other Loan Document, the parties hereto agree that the rule
of ejusdem generis shall not be applicable to limit a general statement, which
is followed by or referable to an enumeration of specific matters, to matters
similar to the matters specifically mentioned.
"Indebtedness" of any Person means, at any time, without duplication,
(a) all indebtedness of such Person for borrowed money or for the deferred
purchase price of property of services (other than current trade liabilities
incurred in the ordinary course of business and operating leases for equipment
and other assets) or which is evidenced by a note, bond, debenture or similar
instrument, (b) all Capital Lease Liabilities of such Person, (c) all
obligations (contingent or otherwise) of such Person to reimburse any bank or
other Person in respect of letters of credit, banker's acceptances or similar
instruments issued for the account of such Person (other than contingent
obligations on performance bonds for customer contracts in the ordinary course
of business), except to the extent any of the foregoing are secured by cash or
cash equivalents, (d) all Hedging Obligations of such Person, (e) all
Contingent Liabilities of such Person in respect of any obligations of any
other Person and (f) all liabilities of the types described in clauses (a)
through (e) above secured by any Lien on any property owned by such Person even
though such Person has not assumed or otherwise become liable for the payment
thereof. For all purposes of this Agreement, 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 such entity, except
to the extent the terms of such Indebtedness provide that such Person is not
liable therefor.
"Indemnified Liabilities" is defined in Section 10.4.
"Indemnified Parties" is defined in Section 10.4.
"Interest Coverage Ratio" means, at the close of any Fiscal Quarter,
the ratio computed for the period consisting of such Fiscal Quarter and each of
the three immediately prior Fiscal Quarters of:
(a) EBITDA (for all such Fiscal Quarters)
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<PAGE> 20
to
(b) subject to the proviso to the definition of "Interest
Expense", the sum, without duplication (for all such Fiscal Quarters),
of Interest Expense of the Borrower and each Subsidiary, paid or
payable in cash during such period, but not any previous period.
"Interest Expense" means, for any Fiscal Quarter, the aggregate
consolidated interest expense of the Borrower and each Guarantor for such
Fiscal Quarter, as determined in accordance with GAAP, including the portion of
any payments made in respect of Capitalized Lease Liabilities allocable to
interest expense; provided, however, that for purposes of calculating Interest
Expense hereunder, whether for purposes of Section 7.2.4 or otherwise, Interest
Expense in respect of the Obligations will be deemed to be due and payable on
each March 31st, June 30th, September 30th and December 31st of each calendar
year, regardless of the definition of "Quarterly Payment Date".
"Interest Period" means, relative to any LIBO Rate Loan, the period
beginning on (and including) the date on which such LIBO Rate Loan is made or
continued as, or converted into, a LIBO Rate Loan pursuant to Section 2.3 or
2.4 and shall end on (but exclude) the day which numerically corresponds to
such date one, two, three or six months thereafter (or, if such month has no
numerically corresponding day, on the last Business Day of such month), as the
Borrower may select in its relevant notice pursuant to Section 2.3 or 2.4;
provided, however, that (i) the Borrower shall not be permitted to have more
than six Interest Periods in effect at any one time, (ii) if such Interest
Period would otherwise end on a day which is not a Business Day, such Interest
Period shall end on the next following Business Day (unless such next following
Business Day is the first Business Day of a calendar month, in which case such
Interest Period shall end on the Business Day next preceding such numerically
corresponding day), and (iii) no Interest Period for any Loan may end later
than the Stated Maturity Date for such Loan.
"Investment" means, relative to any Person, (i) any loan or advance
made by such Person to any other Person (excluding commission, travel, petty
cash, entertainment, moving and similar advances to officers and employees made
in the ordinary course of business), (ii) any Contingent Liability of such
Person incurred in connection with loans or advances described in clause (i),
and (iii) any contribution in or to another Person, whether in cash or other
property, for the purpose of acquiring any ownership or similar interest in
such Person or another Person, or in the assets or businesses of such Person or
another Person, including any ownership or similar interest held by such Person
in any other Person. The amount of any Investment shall be the original
principal or capital amount thereof less all returns of principal or equity
thereon and shall, if made by the contribution, transfer or exchange of
property other than cash (including by way of merger or consolidation), be
deemed to have been made in an original principal or capital amount equal to
the fair market value of such property at the time of such Investment as
determined by such Person in good faith.
"Issuance Request" means a Letter of Credit request and certificate
duly executed by an Authorized Officer of the Borrower, substantially in the
form of Exhibit B-2 hereto.
"Issuer" means Wachovia in its capacity as issuer of the Letters of
Credit. At the request of (i) Wachovia and with the consent of the Borrower and
the Syndication Agent (not to be unreasonably withheld), another Lender or an
Affiliate of Wachovia may issue one or more Letters of Credit hereunder and
(ii) the Borrower and with the consent of the Syndication Agent (not to be
unreasonably withheld), another Lender may issue one or more Letters of Credit
hereunder; provided, that any such Issuer other than Wachovia or one
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<PAGE> 21
of its Affiliates shall be required to provide Wachovia and, if different, the
Administrative Agent with prompt notice as to the amount, issuance or extension
of, and Disbursements under, any such Letter of Credit issued by such Issuer.
"Joint Venture" means any Person in which the Borrower has made an
Investment pursuant to clauses (f) or (j) of Section 7.2.5 and which has been
designated a "Joint Venture" by written notice to the Administrative Agent from
a Responsible Officer of the Borrower; it being agreed that, without limiting
the foregoing, a Joint Venture may be a Subsidiary (including a wholly-owned
Subsidiary) of the Borrower; provided, that (i) except as set forth in clause
(ii) below, each such Joint Venture which is a Subsidiary of the Borrower must
be a direct Subsidiary of (x) the Borrower, (y) a Guarantor which is a
wholly-owned Subsidiary of the Borrower or (z) a non-U.S. Subsidiary of the
Borrower and (ii) each Subsidiary of a Joint Venture which, in turn, is a
Subsidiary of the Borrower must also be a Joint Venture.
"Lender Assignment Agreement" means an assignment agreement
substantially in the form of Exhibit J hereto.
"Lenders" is defined in the preamble and, in addition, shall include
any commercial bank or other financial institution that becomes a Lender
pursuant to Section 10.11.1.
"Lender's Environmental Liability" means any and all losses,
liabilities, obligations, penalties, claims, litigation, demands, defenses,
costs, judgments, suits, proceedings, damages (including consequential
damages), disbursements or expenses of any kind or nature whatsoever (including
reasonable attorneys' fees at trial and appellate levels and experts' fees and
disbursements and expenses incurred in investigating, defending against or
prosecuting any litigation, claim or proceeding) which may at any time be
imposed upon, incurred by or asserted or awarded against the Administrative
Agent, any Lender or any Issuer or any of such Person's Affiliates,
shareholders, directors, officers, employees, and agents in connection with or
arising from (i) any Hazardous Material on, in, under or affecting all or any
portion of any property of the Borrower or any of its Subsidiaries, the
groundwater thereunder, or any surrounding areas thereof to the extent caused
by Releases from the Borrower's or any of its Subsidiaries' or any of their
respective predecessors' properties, (ii) any misrepresentation, inaccuracy or
breach of any warranty, contained or referred to in Section 6.17, (iii) any
violation or claim of violation by the Borrower or any of its Subsidiaries of
any Environmental Laws or (iv) the imposition of any lien for damages caused by
or the recovery of any costs for the cleanup, release or threatened release of
Hazardous Material by the Borrower or any of its Subsidiaries, or in connection
with any property owned or formerly owned by the Borrower or any of its
Subsidiaries.
"Letter of Credit" is defined in Section 2.1.3; it being understood
that the term "Letter of Credit" does not include any letter of credit issued
from time to time by any Person outside this Agreement.
"Letter of Credit Commitment" means, with respect to the Issuer, the
Issuer's obligation to issue Letters of Credit pursuant to Section 2.1.3 and,
with respect to each Lender, the obligations of each such Lender to participate
in such Letters of Credit pursuant to Section 2.6.1.
"Letter of Credit Commitment Amount" means, on any date, a maximum
amount of $10,000,000, as such amount may be permanently reduced from time to
time pursuant to Section 2.2.
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"Letter of Credit Outstandings" means, on any date, an amount equal to
the sum of (i) the then aggregate amount which is undrawn and available under
all issued and outstanding Letters of Credit, plus (ii) the then aggregate
amount of all unpaid and outstanding Reimbursement Obligations.
"Leverage Ratio" means, as of the last day of any Fiscal Quarter, the
ratio of
(a) Total Indebtedness outstanding on the last day of such
Fiscal Quarter
to
(b) EBITDA computed for the period consisting of such Fiscal
Quarter and each of the three immediately preceding Fiscal Quarters.
"LIBO Rate" means, relative to any Interest Period for LIBO Rate
Loans, the rate of interest per annum equal to the average (rounded upwards, if
necessary, to the nearest 1/100th of 1%) of the offered rate for Dollar
deposits in the London interbank market appear on the Telerate page 3750 (or
any successor page thereto or other reference reasonably acceptable to the
Borrower and the Administrative Agent) as of 11:00 a.m. London, England time
two Business Days prior to the beginning of such Interest Period for delivery
on the first day of such Interest Period, and in an amount approximately equal
to the amount of the Administrative Agent's LIBO Rate Loan and for a period
approximately equal to such Interest Period.
"LIBO Rate Loan" means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a rate of interest determined by
reference to the LIBO Rate (Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" means, relative to any Loan to be made,
continued or maintained as, or converted into, a LIBO Rate Loan for any
Interest Period, a rate per annum (rounded upwards, if necessary, to the
nearest 1/16 of 1%) determined pursuant to the following formula:
LIBO Rate
LIBO Rate = -------------------------------
(Reserve Adjusted) 1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate Loans
will be determined by the Administrative Agent on the basis of the LIBOR
Reserve Percentage in effect two Business Days before the first day of such
Interest Period.
"LIBOR Office" means, relative to any Lender, the office of such
Lender designated as such Lender's "LIBOR Office" set forth opposite its name
on Schedule II hereto or in a Lender Assignment Agreement, or such other office
of a Lender as designated from time to time by notice from such Lender to the
Borrower and the Administrative Agent, whether or not outside the United
States, which shall be making or maintaining LIBO Rate Loans of such Lender
hereunder.
"LIBOR Reserve Percentage" means, relative to any Interest Period for
LIBO Rate Loans, the reserve percentage (expressed as a decimal) equal to the
maximum aggregate reserve requirements (including all basic, emergency,
supplemental, marginal and other reserves and taking into account any
transitional adjustments or other scheduled changes in reserve requirements)
specified under regulations issued from time to time by the F.R.S. Board and
then applicable to assets or liabilities consisting of or including
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"Eurocurrency Liabilities", as currently defined in Regulation D of the F.R.S.
Board, having a term approximately equal or comparable to such Interest Period.
"Lien" means any security interest, mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or otherwise),
charge against or interest in property, or other priority or preferential
arrangement of any kind or nature whatsoever, in any such case to secure
payment of a debt or performance of an obligation.
"Loan" means, as the context may require, a Revolving Loan or a Swing
Line Loan.
"Loan Documents" collectively means this Agreement, the Letters of
Credit, each Note, the Fee Letters, the Swing Line Account Agreement, each
agreement pursuant to which the Administrative Agent is granted a Lien to
secure the Obligations and each other agreement, certificate, document or
instrument (exclusive of any Rate Protection Agreement or any Cash Management
Agreement (other than the Swing Line Account Agreement)) to which an Obligor is
a party delivered in connection with this Agreement or such other Loan
Documents, whether or not specifically mentioned herein or therein.
"Material Adverse Effect" means a material adverse effect on (i) the
business, condition (financial or otherwise), operations, performance,
properties or prospects of the Borrower and its Subsidiaries taken as a whole,
(ii) the rights and remedies, taken as a whole, of the Agents, any Lender or
the Issuer, under the Loan Documents or (iii) the ability of the Obligors,
taken as a whole, to perform their monetary Obligations under the Loan
Documents.
"Moody's" means Moody's Investors Service, Inc.
"Net Asset Value" means, at any time of any determination, the sum of
(i) 85% of the amount of the book value (as reflected on the books of the
Borrower) of all Eligible Accounts which are not outstanding more than 90 days
from the original invoice date for such Eligible Accounts, (ii) 50% of the
amount of the book value (as reflected on the books of the Borrower) of all
Eligible Accounts which are outstanding more than 90 days, but not more than
120 days, from the original invoice date for such Eligible Accounts and (iii)
65% of the amount of the book value (as reflected on the books of the Borrower)
of all Unbilled Eligible Accounts, and, in the case of clauses (i) and (ii)
above, valued in accordance with GAAP and net of all credits, discounts and
allowances (and net of all unissued credits in the form of competitive
allowances or otherwise) in respect of such Eligible Accounts.
"Net Debt Proceeds" means, with respect to the incurrence, sale or
issuance by the Borrower or any Guarantor of any Indebtedness of the Borrower
or any Guarantor (other than Indebtedness permitted by Section 7.2.2 as in
effect on the date hereof), the excess of:
(a) the gross cash proceeds received by the Borrower or such
Guarantor from such incurrence, sale or issuance,
over
(b) all underwriting commissions and legal, investment
banking, brokerage and accounting and other professional fees, sales
commissions and disbursements and all other fees, expenses and
charges, in each case actually incurred in connection with such
incurrence, sale or issuance.
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<PAGE> 24
"Net Disposition Proceeds" means, with respect to any sale, transfer
or other disposition of any assets of the Borrower or any Guarantor (other than
an Excluded Disposition), the excess of
(a) the gross cash proceeds received by the Borrower or such
Guarantor from any such sale, transfer or other disposition and any
cash payments received in respect of promissory notes (but only
payments of the principal thereof) or other non-cash consideration
delivered to the Borrower or such Guarantor in respect thereof,
over
(b) the sum of (i) all fees and expenses with respect to
legal, investment banking, brokerage and accounting and other related
fees, sales commissions and disbursements actually incurred in
connection with such sale, transfer or other disposition, (ii) all
taxes and other governmental costs and expenses estimated by the
Borrower to arise in connection with such sale, transfer or other
disposition and (iii) all payments (including principal and accrued
interest) in respect of Indebtedness permitted under this Agreement
secured by such asset, other than (x) Indebtedness hereunder and (y)
Indebtedness incurred in anticipation of such sale; provided, however,
that to the extent the amount actually paid pursuant to clause (ii)
above shall be less than the Borrower's estimate thereof, such
difference shall, pursuant to Section 3.1.1(f), be applied as set
forth in Section 3.1.2.
"Net Equity Proceeds" means with respect to (i) the sale or issuance
by the Borrower to any Person of any Capital Stock of the Borrower or warrants
or options for any such stock or the exercise of any such warrants or options
or (ii) the issuance by any Guarantor of newly-issued Capital Stock of such
Guarantor to any Person other than the Borrower or a Guarantor which is
wholly-owned by the Borrower, the excess of:
(a) the gross cash proceeds received by the Borrower from
such sale or issuance,
over
(b) all underwriting commissions and legal, investment
banking, brokerage and accounting and other related fees, sales
commissions and disbursements actually incurred in connection with
such sale or issuance which have not been paid to Affiliates of the
Borrower in connection therewith.
"Net Income" means, for any period, the aggregate of all amounts
(exclusive of all amounts in respect of any extraordinary gains but including
extraordinary losses) which, in accordance with GAAP, would be included as net
income on the consolidated financial statements of the Borrower and its
Subsidiaries for such period; provided, however, that, for purposes of
calculating EBITDA for any period that includes a Fiscal Quarter ending in 1998
(or the twelve-month period beginning with the date on which any successor
AICPA Statement of Position (an "SOP") to SOP 97-2 becomes effective (SOP 97-
2, together with any such successor SOP, a "Revenue Recognition SOP")), the
Borrower, at its election (as set forth in the applicable Compliance
Certificate), may reverse the effect of any postponement of revenues from such
Fiscal Quarter to a succeeding Fiscal Quarter not included in such period
resulting from adherence to a Revenue Recognition SOP to the extent the
aggregate amount of such revenues not postponed, when added to the aggregate
amount of revenues theretofore not postponed pursuant to this proviso, does not
exceed $7,500,000 in the aggregate; provided, further, however, that, in order
to avoid duplication, when utilizing the previous proviso the Borrower shall
exclude from its determination of revenues for any applicable period revenues
for a Fiscal
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<PAGE> 25
Quarter which (x) pursuant to the preceding proviso, are not so postponed by
the Borrower for purposes hereof and (y) are realized in a succeeding Fiscal
Quarter.
"Net Worth" means the consolidated net worth of the Borrower and its
Subsidiaries, as determined in accordance with GAAP.
"Note" means, as the context may require, a Revolving Note or a Swing
Line Note.
"Obligations" means all obligations (monetary or otherwise whether
absolute or contingent, matured or unmatured) of the Borrower and each other
Obligor arising under or in connection with (i) this Agreement, the Notes, each
Letter of Credit and each other Loan Document (exclusive of any Rate Protection
Agreement or Cash Management Agreement, other than as provided in clause (ii)
below) and (ii) the Swing Line Account Agreement.
"Obligor" means, as the context may require, the Borrower and each
other Person (other than a Secured Party) obligated under any Loan Document.
"Organic Document" means, relative to any Obligor, as applicable, its
certificate of incorporation, by-laws, certificate of partnership, partnership
agreement, certificate of formation, limited liability agreement and all
shareholder agreements, voting trusts and similar arrangements applicable to
any of such Obligor's partnership interests, limited liability company
interests or authorized shares of capital stock.
"Participant" is defined in Section 10.11.2.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in
Section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a
multiemployer plan as defined in Section 4001(a)(3) of ERISA), and to which the
Borrower or any corporation, trade or business that is, along with the
Borrower, a member of a Controlled Group, may have liability, including any
liability by reason of having been a substantial employer within the meaning of
Section 4063 of ERISA at any time during the preceding five years, or by reason
of being deemed to be a contributing sponsor under Section 4069 of ERISA.
"Percentage" means, relative to any Lender, the percentage set forth
opposite its name on Schedule II hereto or set forth in a Lender Assignment
Agreement, as such percentage may be adjusted from time to time pursuant to any
Lender Assignment Agreement executed by such Lender and its Assignee Lender and
delivered pursuant to Section 10.11.1. As used herein, "Percentage", as it
relates to a Lender's Percentage of Letter of Credit Outstandings or Swing Line
Loans, shall be equal to such Lender's Percentage of Revolving Loans.
"Perfection Certificate" means the Perfection Certificate executed and
delivered by an Authorized Officer of each Obligor that is a party to a
Collateral Document on the date the initial Credit Extension is made,
substantially in the form of Exhibit I hereto, as amended, supplemented,
amended and restated or otherwise modified from time to time.
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<PAGE> 26
"Permits" means domestic and foreign licenses, permits and approvals,
including provincial, state, federal, city and county permits and approvals.
"Permitted Liens" means Liens expressly permitted to exist pursuant to
Section 7.2.3 hereof.
"Person" means any natural person, corporation, limited liability
company, partnership, joint venture, association, trust or unincorporated
organization, Governmental Authority or any other legal entity, whether acting
in an individual, fiduciary or other capacity.
"Plan" means any Pension Plan or Welfare Plan.
"Pledge Agreement" means the Pledge Agreement executed and delivered
by an Authorized Officer of the Borrower and each Guarantor party thereto
pursuant to Section 5.1.4, substantially in the form of Exhibit G hereto, as
amended, supplemented, amended and restated or otherwise modified.
"Pledged Subsidiary" means, at any time, each Subsidiary in respect of
which the Administrative Agent has been granted, at such time, a security
interest in and to, or a pledge of, (i) any of the issued and outstanding
shares of Capital Stock of such Subsidiary, or (ii) any intercompany notes of
such Subsidiary owing to the Borrower or another Subsidiary of the Borrower.
"Preliminary Compliance Certificate" means a certificate duly
completed and executed by an Authorized Officer of the Borrower, substantially
in the form of Exhibit E-2 hereto, together with such changes thereto as may be
agreed upon from time to time by the Administrative Agent and the Borrower.
"Quarterly Payment Date" means the first day of April, July, October
and January, or, if any such day is not a Business Day, the next succeeding
Business Day.
"Rate Protection Agreement" means, collectively, any interest rate
swap, cap, collar or similar agreement entered into by the Borrower or any of
its Subsidiaries under which the counterparty to such agreement is (or at the
time such agreement was entered into, was) a Lender or an Affiliate of a
Lender.
"Receivables Subsidiary" means a Subsidiary of the Borrower which is a
Joint Venture and has as its sole business purpose the purchase of accounts
receivable of customers of the Borrower and its Subsidiaries, together with
such other activities as are reasonably related thereto.
"Refunding Date" is defined in clause (b) of Section 2.3.2.
"Refunding Loan" is defined in clause (b) of Section 2.3.2.
"Reimbursement Obligation" is defined in Section 2.6.3.
"Related Fund" means, with respect to any Lender that is a fund that
invests in loans, any other fund that invests in loans and is managed by the
same investment advisor or investment manager as such Lender.
"Release" means a "release", as such term is defined in CERCLA.
"Replacement Lender" is defined in of Section 4.10.
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"Replacement Notice" is defined in Section 4.10.
"Required Lenders" means, subject to the proviso below, at any time,
(i) prior to the date of the initial Credit Extension hereunder, Lenders having
at least a majority of the Commitments, and (ii) on and after the date of the
initial Credit Extension, Lenders holding at least a majority of the Total
Exposure Amount; provided, however, that at all times (x) prior to the date of
the initial Credit Extension, until DLJ holds less than 51% of the Commitments
or (y) on and after the date of the initial Credit Extension, until DLJ holds
(for the first time) less than 51% of the Total Exposure Amount, "Required
Lenders" shall mean, at any time, at least two Lenders which, collectively,
hold a majority of the Commitments or a majority of the Total Exposure Amount,
as applicable.
"Resource Conservation and Recovery Act" means the Resource
Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., as amended.
"Responsible Officer" means each and any of the Chief Executive
Officer, Chief Financial Officer, Treasurer or General Counsel of the Borrower.
"Restricted Payment" is defined in Section 7.2.6.
"Revolving Loan" is defined in Section 2.1.1.
"Revolving Loan Commitment" is defined in Section 2.1.1.
"Revolving Loan Commitment Amount" means, on any date, $100,000,000,
as such amount may be reduced from time to time pursuant to Section 2.2, 8.2 or
8.3.
"Revolving Note" means a promissory note of the Borrower payable to
any Lender, substantially in the form of Exhibit A-1 hereto (as such promissory
note may be amended, endorsed or otherwise modified from time to time in
accordance with the terms hereof and thereof), evidencing the aggregate
Indebtedness of the Borrower to such Lender resulting from outstanding
Revolving Loans, and also means all other promissory notes accepted from time
to time in substitution therefor or renewal thereof.
"S&P" means Standard & Poor's Rating Services.
"SEC" means the Securities and Exchange Commission.
"Secured Party" means, as the context may require, any Lender, the
Issuer, any Agent, each counterparty to a Rate Protection Agreement that is (or
at the time such Rate Protection Agreement was entered into, was) a Lender or
an Affiliate thereof, each counterparty to a Cash Management Agreement that is
a Lender or an Affiliate thereof, and, in each case, each of their respective
successors and permitted transferees and assigns.
"Security Agreement" means the Security Agreement executed and
delivered by an Authorized Officer of the Borrower and each Guarantor party
thereto pursuant to Section 5.1.6, substantially in the form of Exhibit F
hereto, as amended, supplemented, amended and restated or otherwise modified.
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"Senior Note Documents" shall mean and include each of the documents
and other agreements entered into (including the Senior Note Indenture and any
guaranty or guaranties relating thereto) relating to the issuance by the
Borrower of the Senior Notes, as in effect on the date of the initial Credit
Extension (to the extent thereof) and as the same may be entered into, modified,
supplemented or amended from time to time pursuant to the terms hereof and
thereof.
"Senior Note Indenture" means the Indenture entered into by and
between the Borrower and State Street Bank & Trust Company, as trustee
thereunder, as in effect on the date hereof and as the same may be amended or
otherwise modified from time to time in accordance with the terms hereof and
thereof.
"Senior Notes" means the Borrower's 9 1/2% Senior Notes due February
15, 2005, as in effect on the date hereof and as the same may be amended or
otherwise modified from time to time in accordance with the terms hereof and
thereof.
"Stated Amount" means on any date and with respect to any Letter of
Credit, the total amount then available to be drawn under such Letter of
Credit.
"Stated Expiry Date" is defined in Section 2.6.
"Stated Maturity Date" means February 28, 2001.
"Subsidiary" means, with respect to any Person, any corporation,
limited liability company, partnership or other entity of which more than 50%
of the outstanding securities (or other ownership interest) having ordinary
voting power to elect the board of directors, managers or other voting members
of the governing body of such corporation, limited liability company,
partnership or other entity (irrespective of whether at the time securities (or
other ownership interest) of any other class or classes of such corporation,
limited liability company, partnership or other entity shall or might have
voting power upon the occurrence of any contingency) is at the time directly or
indirectly owned or controlled by such Person, by such Person and one or more
other Subsidiaries of such Person, or by one or more other Subsidiaries of such
Person. Unless the context otherwise specifically requires, the term
"Subsidiary" shall be a reference to a Subsidiary of the Borrower.
"Subsidiary Collateral Document" means any Subsidiary Guaranty, the
Pledge Agreement or the Security Agreement, in each case as amended,
supplemented or otherwise modified.
"Subsidiary Guaranty" means any subsidiary guaranty executed and
delivered by an Authorized Officer of a U.S. Subsidiary of the Borrower
pursuant to the terms of this Agreement, substantially in the form of Exhibit H
hereto, as amended, supplemented, amended and restated or otherwise modified.
"Swing Line Account Agreement" shall mean the Financial Management
Account Investment/Commercial Loan Access Agreement, a copy of which, as in
effect on the date hereof, is attached hereto as Exhibit L, between the
Borrower and the Swing Line Lender, as amended, modified, supplemented or
replaced from time to time with the approval of the Required Lenders.
"Swing Line Lender" means Wachovia, in its capacity as Swing Line
Lender hereunder.
"Swing Line Loan" is defined in of Section 2.1.2.
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"Swing Line Loan Commitment" is defined in of Section 2.1.2.
"Swing Line Loan Commitment Amount" means, on any date, $7,500,000, as
such amount may be reduced from time to time pursuant to Section 2.2.
"Swing Line Note" means a promissory note of the Borrower payable to
the Swing Line Lender, in the form of Exhibit A-2 hereto (as such promissory
note may be amended, endorsed or otherwise modified from time to time),
evidencing the aggregate Indebtedness of the Borrower to the Swing Line Lender
resulting from outstanding Swing Line Loans, and also means all other
promissory notes accepted from time to time in substitution therefor or renewal
thereof.
"Syndication Agent" is defined in the preamble and includes each other
Person as shall have subsequently been appointed as the successor Syndication
Agent pursuant to Section 10.4.
"Taxes" is defined in Section 4.6.
"Total Exposure Amount" means, on any date of determination (and
without duplication), the outstanding principal amount of all Loans, the
aggregate amount of all Letter of Credit Outstandings and the unfunded amount
of the Commitments.
"Total Indebtedness" means, on any date, the aggregate amount (without
duplication) of (x) the outstanding principal amount of all Indebtedness of the
Borrower and its Subsidiaries that appears on the consolidated balance sheet of
the Borrower and its Subsidiaries as of such date, plus (y) all Indebtedness of
the Borrower and its Subsidiaries in respect of letters of credit (including
Letters of Credit), other than any portion of such letters of credit which has
been cash collateralized.
"Trademark Security Agreement" means any Trademark Security Agreement
executed and delivered by any Obligor in substantially the form of Exhibit B to
any Security Agreement, as amended, supplemented, amended and restated or
otherwise modified.
"Transaction" means the execution and delivery of this Agreement and
all other Loan Documents, the execution and delivery of the Senior Note
Indenture, the Issuance of the Notes hereunder, the issuance and purchase of
the Senior Notes, the refinancing of the Bridge Notes and all other
transactions, if any, entered into on the date of the initial Credit Extension
that is related to any of the foregoing.
"type" means, relative to any Loan, the portion thereof, if any, being
maintained as a Base Rate Loan or a LIBO Rate Loan.
"U.C.C." means the Uniform Commercial Code as from time to time in
effect in the State of New York.
"Unbilled Eligible Accounts" means, for purposes hereof and at any
time of determination, any amount receivable owing to the Borrower or any
Guarantor arising from the rendering of services in the ordinary course of
business by the Healthcare Services Business as to which (i) such amount
receivable would be an Eligible Account hereunder but for the fact that the
Borrower or such Guarantor, as the case may be, has not yet invoiced the
Account Debtor for such rendering of services, (ii) no more than 90 days have
elapsed since the time of the rendering of such services giving rise to such
amount receivable, (iii) the
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Borrower or such Guarantor, as the case may be, which has rendered such
services was, at the time such services were rendered, a member of the
Healthcare Services Business and (iv) the Borrower has, at all times, recorded
and recognized such amount receivable on its books and records in a manner no
less conservative than that as in effect on the Effective Date.
"United States" or "U.S." means the United States of America, the
fifty states thereof and the District of Columbia.
"U.S. Subsidiary" means any Subsidiary that is incorporated or
organized under the laws of the United States or a state thereof or the
District of Columbia.
"Voting Stock" means, with respect to any Person, Capital Stock of any
class or kind ordinarily having the power to vote for the election of
directors, managers or other voting members of the governing body of such
Person.
"Wachovia" is defined in the preamble.
"Welfare Plan" means a "welfare plan", as such term is defined in
section 3(1) of ERISA.
"wholly owned" means any Subsidiary all of the outstanding common
stock (or similar equity interest) of which (other than any director's
qualifying shares or investments by foreign nationals mandated by applicable
laws) is owned directly or indirectly by the Borrower.
SECTION 1.2. Use of Defined Terms. Unless otherwise defined or the
context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in each other Loan Document and
the Disclosure Schedule.
SECTION 1.3. Cross-References. Unless otherwise specified, references
in this Agreement and in each other Loan Document to any Article or Section are
references to such Article or Section of this Agreement or such other Loan
Document, as the case may be, and, unless otherwise specified, references in
any Article, Section or definition to any clause are references to such clause
of such Article, Section or definition.
SECTION 1.4. Accounting and Financial Determinations. Unless otherwise
specified, all accounting terms used herein or in any other Loan Document shall
be interpreted, and all accounting determinations and computations hereunder or
thereunder (including under Section 7.2.4) shall be made, in accordance with,
those generally accepted accounting principles as in effect from time to time
("GAAP"); provided that (i) nothing herein shall prevent or restrict the
Borrower from making the election described in the proviso to the definition of
"Net Income", and (ii) if, after the date hereof, there is any change in GAAP
as applied in the preparation of the Borrower's financial statements for the
Fiscal Year ended December 31, 1997, as filed with the SEC on Form 10-K, then,
until such time as replacement covenants reflecting such change in GAAP are
negotiated and agreed upon (which negotiations each party hereto hereby agrees
to enter into in good faith, unless such parties agree that no replacement
covenants are necessary), the Borrower's compliance with the financial
covenants set forth herein shall be based on GAAP as in effect as of the date
hereof or such later date as the parties have mutually agreed upon. Unless
otherwise expressly provided, all financial covenants and defined financial
terms shall be computed on a consolidated basis for the Borrower and its
Subsidiaries, in each case without duplication.
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ARTICLE II
COMMITMENTS, BORROWING AND ISSUANCE
PROCEDURES, NOTES AND LETTERS OF CREDIT
SECTION 2.1. Commitments. On the terms and subject to the conditions
of this Agreement, (i) each Lender severally agrees to make Loans (other than
Swing Line Loans) pursuant to its Revolving Loan Commitment, (ii) the Swing
Line Lender agrees to make Swing Line Loans pursuant to its Swing Line Loan
Commitment, and (iii) the Issuer agrees that it will issue Letters of Credit
pursuant to Section 2.1.3, and each Lender severally agrees that it will
purchase participation interests in such Letters of Credit pursuant to Section
2.6.1., in each case as described in more detail in this Section 2.1.
SECTION 2.1.1. Revolving Loan Commitments. From time to time on any
Business Day occurring from and after the Effective Date but prior to the
Commitment Termination Date, each Lender will make loans (relative to such
Lender, its "Revolving Loans") to the Borrower equal to such Lender's
Percentage of the aggregate amount of the Revolving Loan Borrowing requested by
the Borrower to be made on such day. On the terms and subject to the conditions
hereof, the Borrower may from time to time borrow, prepay and reborrow the
Loans. No amounts paid or prepaid with respect to any Revolving Loan
outstanding after the Commitment Termination Date may be reborrowed.
SECTION 2.1.2. Swing Line Loan Commitment. From time to time on any
Business Day occurring from and after the Effective Date but prior to the
Commitment Termination Date, the Swing Line Lender will make loans (each a
"Swing Line Loan") to the Borrower equal to the principal amount of the Swing
Line Loan requested by the Borrower to be made on such day. The Commitment of
the Swing Line Lender described in this Section is herein referred to as its
"Swing Line Loan Commitment". On the terms and subject to the conditions
hereof, the Borrower may from time to time borrow, prepay and reborrow Swing
Line Loans.
SECTION 2.1.3. Letter of Credit Commitment. From time to time on any
Business Day occurring from and after the Effective Date but prior to the
Commitment Termination Date, the Issuer will (i) issue one or more standby
letters of credit (a "Letter of Credit") for the account of the Borrower in the
Stated Amount requested by the Borrower on such day, or (ii) extend the Stated
Expiry Date of any existing Letter of Credit previously issued hereunder to a
date not later than the earlier of (x) unless such Letter of Credit is cash
collateralized in a manner reasonably satisfactory to the Issuer, the
Commitment Termination Date and (y) one year from the date of such extension.
SECTION 2.1.4. Lenders Not Permitted or Required to Make Loans. No
Lender shall be permitted or required to make any Revolving Loan if, after
applying the proceeds thereof, the aggregate outstanding principal amount (i)
of all Loans of all Lenders, together with the aggregate amount of all Letter
of Credit Outstandings, would exceed the lesser of (x) the then existing
Commitment Amount and (y) the then applicable Borrowing Base Amount, (ii) of
all Revolving Loans of such Lender, together with such Lender's Percentage of
the aggregate amount of all Letter of Credit Outstandings and Swing Line Loans
outstanding, would exceed such Lender's Percentage of the lesser of (x) the
then existing Commitment Amount and (y) the then applicable Borrowing Base
Amount, or (iii) in the case of the Swing Line Lender, of all Swing Line Loans
would exceed the Swing Line Loan Commitment Amount. It is understood and agreed
that, for purposes of determining compliance herewith, the Lenders shall rely
upon the Borrowing Request delivered in
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respect of any Revolving Loan, and the Administrative Agent shall not be
responsible or liable for monitoring compliance with the Borrowing Base Amount
or Swing Line Loan Amount for purposes of clause (ii) or (iii) hereof.
SECTION 2.1.5. Issuer Not Permitted or Required to Issue Letters of
Credit. No Issuer shall be permitted or required to issue, extend or renew any
Letter of Credit if, after giving effect thereto, (a) the aggregate amount of
all Letter of Credit Outstandings would exceed the Letter of Credit Commitment
Amount or (b) the sum of the aggregate amount of all Letter of Credit
Outstandings plus the aggregate principal amount of all Loans then outstanding
would exceed the lesser of (x) the Commitment Amount and (y) the then
applicable Borrowing Base Amount.
SECTION 2.2. Reduction of the Commitment Amount. The Borrower may,
from time to time on any Business Day prior to the Commitment Termination Date,
voluntarily reduce any Commitment Amount on the Business Day so specified by
the Borrower; provided, however, that all such reductions shall require at
least one Business Day's prior notice to the Administrative Agent and be
permanent, and any partial reduction of any Commitment Amount shall be in a
minimum amount of $1,000,000 and in an integral multiple of $500,000.
SECTION 2.3. Borrowing Procedures, etc. Revolving Loans (exclusive
of Swing Line Loans) shall be made by the Lenders in accordance with Section
2.3.1 below, and Swing Line Loans shall be made by the Swing Line Lender in
accordance with Section 2.3.2 below:
SECTION 2.3.1. Revolving Loans. By delivering a Borrowing Request to
the Administrative Agent on or before noon, New York time, on a Business Day,
the Borrower may from time to time irrevocably request, not less than one
Business Day's notice in the case of Base Rate Loans, or three Business Days'
notice in the case of LIBO Rate Loans, and in either case not more than seven
Business Days' notice, that a Borrowing be made, in the case of LIBO Rate
Loans, in a minimum amount of $1,000,000 and an integral multiple of $100,000,
in the case of Base Rate Loans, in a minimum amount of $1,000,000 and an
integral multiple of $100,000 or, in either case, in the unused amount of the
Revolving Loan Commitment Amount; provided, however, that all initial Loans
shall be made as Base Rate Loans. No Borrowing Request shall be required, and
the minimum aggregate amounts specified under this Section 2.3.1 shall not
apply, in the case of Refunding Loans made pursuant to Section 2.3.2. On the
terms and subject to the conditions of this Agreement, each Borrowing shall be
comprised of the type of Loans, and shall be made on the Business Day,
specified in such Borrowing Request. On or before 11:00 a.m. (Atlanta, Georgia
time) on such Business Day each Lender that has a Commitment to make the Loans
being requested shall deposit with the Administrative Agent same day funds in
an amount equal to such Lender's Percentage of the requested Borrowing. Such
deposit will be made to an account which the Administrative Agent shall specify
from time to time by notice to the Lenders. To the extent funds are received
from the Lenders, the Administrative Agent shall make such funds available to
the Borrower by wire transfer or credit entry to the accounts the Borrower
shall have specified in its Borrowing Request. No Lender's obligation to make
any Loan shall be affected by any other Lender's failure to make any Loan.
SECTION 2.3.2. Swing Line Loans.
(a) So long as Wachovia is the Swing Line Lender, the Commitment
Termination Date shall not have occurred and the Swing Line Account Agreement
shall not have been terminated, all Swing Line Loans shall be requested or
deemed requested by the Borrower pursuant to the Swing Line Account Agreement
and
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all Borrowings of Swing Line Loans under this Agreement shall be made in
accordance with the Swing Line Account Agreement. In the event Wachovia ceases
to be the Swing Line Lender or the Swing Line Loan Account Agreement has been
terminated, so long as the Commitment Termination Date shall not have occurred,
Swing Line Loans may be requested by same day telephonic notice (followed by
written confirmation no later than the next succeeding Business Day) on or
before 12:00 noon on the Business Day such Swing Line Loan is requested to be
made; provided that all such Swing Line Loans shall be made in a minimum
principal amount of $10,000 and an integral multiple of at least $10,000. All
Swing Line Loans shall be made and maintained as Base Rate Loans and shall not
be entitled to be converted into LIBO Rate Loans. The proceeds of each Swing
Line Loan shall be made available to the Borrower as provided in the Swing Line
Account Agreement.
(b) If (i) for any period of five consecutive Business Days, Swing
Line Loans shall be outstanding in an aggregate principal amount in excess of
$1,000,000 or (ii) any Default (other than a Default of the nature set forth in
Section 8.1.9) shall occur and be continuing, each Lender shall be obligated,
without any further action or notice, to make a Revolving Loan (which shall
initially be funded as a Base Rate Loan) in an amount equal to such Lender's
Percentage of the aggregate principal amount of all such Swing Line Loans then
outstanding (such new Revolving Loan being herein referred to as a "Refunding
Loan"); provided, however, that (x) for purposes of clause (i) above, the
Borrower shall be obligated to give notice to the Administrative Agent on or
before the first Business Day following any such period of five consecutive
Business Days when the aggregate outstanding principal amount of Swing Line
Loans has exceeded $1,000,000, which notice shall be accompanied by a Borrowing
Request requesting a Borrowing of Refunding Loans as required above, and (y) no
Lender shall be required to make any Refunding Loan if, after giving effect
thereto, (A) the sum of all outstanding Refunding Loans made by such Lender
would exceed such Lender's Percentage of the Swing Line Loan Commitment Amount
or (B) the sum of all Swing Line Loans and Revolving Loans made by such Lender,
plus such Lender's Percentage of the aggregate amount of all Letter of Credit
Outstandings, would exceed such Lender's Percentage of the then existing
Revolving Loan Commitment Amount. The Administrative Agent shall promptly
notify the other Lenders of the Borrowing Request for Refunding Loans described
above, and, on or before 10:00 a.m. (Atlanta, Georgia time) on the first
Business Day following such notice to the Lenders by the Administrative Agent,
each Lender shall deposit in an account specified by the Swing Line Lender the
amount required pursuant to the previous sentence in same day funds and such
funds shall be applied by the Swing Line Lender to repay the outstanding Swing
Line Loans. At the time the aforementioned Lenders make the above referenced
Refunding Loans, the Swing Line Lender shall be deemed to have made, a
Revolving Loan in an amount equal to the Swing Line Lender's Percentage of the
aggregate principal amount of the outstanding Swing Line Loans. Upon the making
(or deemed making, in the case of the Swing Line Lender) of any Revolving Loans
pursuant to this clause (b), the amount so funded shall become outstanding
under such Lender's Revolving Note and shall no longer be owed under the Swing
Line Note. All interest payable with respect to any Revolving Loans made (or
deemed made, in the case of the Swing Line Lender) pursuant to this clause (b)
shall be appropriately adjusted to reflect the period of time during which the
Swing Line Lender had outstanding Swing Line Loans in respect of which such
Revolving Loans were made.
Any term or provision of this Agreement to the contrary
notwithstanding, the parties hereto agree that:
(i) in the event the Borrower fails to give timely notice as
provided in clause (x) above and Refunding Loans are not made, as
provided above, to refund Swing Lines Loans which have remained
outstanding in an aggregate principal amount in excess of $1,000,000
for five consecutive
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Business Days (the date which is the earlier of (A) the Business Day
following thedate such notice is ultimately given and (B) the date
such Refunding Loans required pursuant to this clause (b) are made,
being herein referred to as the "Refunding Date"), then each Lender,
other than the Swing Line Lender, shall be entitled to receive (in
addition to all other amounts payable to such Lender hereunder) the
Additional Compensation Amount; and
(ii) the Additional Compensation Amount shall be payable five
Business Days after demand thereof by any Lender entitled thereto; it
being hereby agreed that the Borrower's obligation to pay such
Additional Compensation Amount shall be the only obligation of the
Borrower for purposes of this clause (b), and the Borrower's failure
to provide such notice described above shall not, in and of itself,
constitute a Default or Event of Default hereunder or result in any
other liability.
(c) If, at any time prior to the making of Revolving Loans to replace
any outstanding Swing Line Loans pursuant to clause (b) above, any Default of
the nature set forth in Section 8.1.9 shall have occurred, each Lender with a
Revolving Loan Commitment (other than the Swing Line Lender) irrevocably agrees
that it will, at the request of the Swing Line Lender and upon notice from the
Administrative Agent, purchase an undivided participation interest in all such
Swing Line Loans in an amount equal to its Percentage of the aggregate
outstanding amount of such Swing Line Loans and transfer immediately to an
account identified by the Swing Line Lender, in immediately available funds,
the amount of its participation. The Swing Line Lender will deliver to each
such Lender, promptly following receipt of such funds, a participation
certificate, dated the date of receipt of such funds and in the amount of such
Lender's participation if requested to do so by such Lender.
(d) The Borrower expressly agrees that, in respect of each Lender's
funded participation interest in any Swing Line Loan, such Lender shall be
deemed to be in privity of contract with the Borrower and have the same rights
and remedies against the Borrower under the Loan Documents as if such funded
participation interest in such Swing Line Loan were a Revolving Loan.
(e) Each Lender's obligation (in the case of Lenders with a Revolving
Loan Commitment) to make Revolving Loans or purchase participation interests in
Swing Line Loans, as contemplated by clause (b) or (c) above, shall be absolute
and unconditional and without recourse to the Swing Line Lender and shall not
be affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense or other right which such Revolving Lender may have against
the Swing Line Lender, the Borrower or any other Person for any reason
whatsoever, (ii) the occurrence or continuance of a Default, an Event of
Default or a Material Adverse Effect, (iii) the acceleration or maturity of any
Loans or the termination of any Commitment after the making of any Swing Line
Loan, (iv) any breach of this Agreement or any other Loan Document by the
Borrower, any other Obligor or any Lender, or (v) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing.
SECTION 2.4. Continuation and Conversion Elections. By delivering a
Continuation/ Conversion Notice to the Administrative Agent on or before noon,
Atlanta, Georgia time, on a Business Day, the Borrower may from time to time
irrevocably elect, on not less than one Business Day's notice in the case of
Base Rate Loans, or three Business Days' notice in the case of LIBO Rate Loans,
and in either case not more than seven Business Days' notice, that all, or any
portion in an aggregate minimum amount of $1,000,000 and an integral multiple
of $100,000 be, in the case of Base Rate Loans, converted into LIBO Rate Loans
or be, in the case of LIBO Rate Loans, converted into Base Rate Loans or
continued as LIBO Rate Loans (in the absence of delivery of a
Continuation/Conversion Notice with respect to any LIBO Rate Loan at least
three
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Business Days (but no more than seven Business Days) before the last day of the
then current Interest Period with respect thereto, such LIBO Rate Loan shall,
on such last day, automatically convert to a Base Rate Loan); provided,
however, that (x) each such conversion or continuation shall be pro rated among
the applicable outstanding Loans of all Lenders that have made such Loans, and
(y) no portion of the outstanding principal amount of any Loans may be
continued as, or be converted into, LIBO Rate Loans when any Event of Default
has occurred and is continuing.
SECTION 2.5. Funding. Each Lender may, if it so elects, fulfill its
obligation to make, continue or convert LIBO Rate Loans hereunder by causing
one of its foreign branches or Affiliates (or an international banking facility
created by such Lender) to make or maintain such LIBO Rate Loan; provided,
however, that such LIBO Rate Loan shall nonetheless be deemed to have been made
and to be held by such Lender, and the obligation of the Borrower to repay such
LIBO Rate Loan shall nevertheless be to such Lender for the account of such
foreign branch, Affiliate or international banking facility. In addition, the
Borrower and each Lender hereby consents and agrees that, for purposes of any
determination to be made for purposes of Section 4.1, 4.2, 4.3 or 4.4, it shall
be conclusively assumed that each Lender elected to fund all LIBO Rate Loans by
purchasing Dollar deposits in its LIBOR Office's interbank eurodollar market.
SECTION 2.6. Issuance Procedures. By delivering to the
Administrative Agent an Issuance Request on or before noon, Atlanta, Georgia
time, on a Business Day, the Borrower may from time to time irrevocably request
on not less than three nor more than ten Business Days' notice, in the case of
an initial issuance of a Letter of Credit and not less than three Business
Days' prior notice, in the case of a request for the extension of the Stated
Expiry Date of a standby Letter of Credit, that the Issuer issue, or extend the
Stated Expiry Date of, as the case may be, an irrevocable Letter of Credit in
such form as may be requested by the Borrower and approved by the Issuer. Each
Letter of Credit (including any Letter of Credit which has had its Stated
Expiry Date extended) shall by its terms be stated to expire on a date (its
"Stated Expiry Date") no later than the earlier to occur of (i) unless cash
collateralized in a manner reasonably satisfactory to the Issuer, the
Commitment Termination Date or (ii) (unless otherwise agreed to by the Issuer,
in its sole discretion) one year from the date of its issuance or the extension
of its Stated Expiry Date. The Issuer will make available to the beneficiary
thereof the original of the Letter of Credit which it issues hereunder.
SECTION 2.6.1. Other Lenders' Participation. Upon the issuance of each
Letter of Credit issued by the Issuer pursuant hereto, and without further
action, each Lender (other than such Issuer) shall be deemed to have
irrevocably purchased, to the extent of its Percentage to make Loans, and the
Issuer shall be deemed to have irrevocably granted and sold to such Lender, a
participation interest in such Letter of Credit (including the Contingent
Liability and any Reimbursement Obligation with respect thereto), and such
Lender shall, to the extent of its Percentage to make Loans, be responsible for
reimbursing promptly (and in any event within one Business Day) the Issuer for
Reimbursement Obligations which have not been reimbursed by the Borrower in
accordance with Section 2.6.3. In addition, such Lender shall, to the extent of
its Percentage to make Loans, be entitled to receive a ratable portion of the
Letter of Credit fees payable pursuant to Section 3.3.3 with respect to each
Letter of Credit (other than the issuance fees payable to an Issuer of such
Letter of Credit pursuant to the last sentence of Section 3.3.3) and of
interest payable pursuant to Section 3.2 with respect to any Reimbursement
Obligation. To the extent that any Lender has reimbursed the Issuer for a
Disbursement, such Lender shall be entitled to receive its ratable portion of
any amounts subsequently received (from the Borrower or otherwise) in respect
of such Disbursement.
SECTION 2.6.2. Disbursements. The Issuer will notify the Borrower and
the Administrative Agent promptly of the presentment for payment of any Letter
of Credit issued by the Issuer, together with notice of
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the date (the "Disbursement Date") such payment shall be made (each such
payment, a "Disbursement"). Subject to the terms and provisions of such Letter
of Credit and this Agreement, the Issuer shall make such payment to the
beneficiary (or its designee) of such Letter of Credit. Prior to 11:00 a.m.,
Atlanta, Georgia time, on the fourth Business Day following the Disbursement
Date, the Borrower will reimburse the Administrative Agent, for the account of
the Issuer, for all amounts which Issuer has disbursed under such Letter of
Credit, together with interest thereon at a rate per annum equal to the rate
per annum then in effect for Base Rate Loans (with the then Applicable Margin
for Loans accruing on such amount) pursuant to Section 3.2 for the period from
the Disbursement Date through the date of such reimbursement. Without limiting
in any way the foregoing and notwithstanding anything to the contrary contained
herein or in any separate application for any Letter of Credit, the Borrower
hereby acknowledges and agrees that it shall be obligated to reimburse the
Issuer on the terms set forth herein for each Disbursement of a Letter of
Credit, and it shall be deemed to be the obligor for purposes of each such
Letter of Credit issued hereunder.
SECTION 2.6.3. Reimbursement. The obligation (a "Reimbursement
Obligation") of the Borrower under Section 2.6.2 to reimburse the Issuer with
respect to each Disbursement (including interest thereon), and, upon the
failure of the Borrower to reimburse the Issuer, each Lender's obligation under
Section 2.6.1 to reimburse the Issuer, shall be absolute and unconditional
under any and all circumstances and irrespective of any setoff, counterclaim or
defense to payment which the Borrower or such Lender, as the case may be, may
have or have had against the Issuer or any Lender, including any defense based
upon the failure of any Disbursement to conform to the terms of the applicable
Letter of Credit (if, in such Issuer's good faith opinion, such Disbursement is
determined to be appropriate) or any non-application or misapplication by the
beneficiary of the proceeds of such Letter of Credit; provided, however, that
after paying in full its Reimbursement Obligation hereunder, nothing herein
shall adversely affect the right of the Borrower or such Lender, as the case
may be, to commence any proceeding against the Issuer for any wrongful
Disbursement made by the Issuer under a Letter of Credit as a result of acts or
omissions constituting gross negligence or wilful misconduct on the part of
such Issuer or to the extent such Disbursement was otherwise wrongful under the
UCC.
SECTION 2.6.4. Deemed Disbursements. Upon the occurrence and during
the continuation of any Event of Default under Section 8.1.9 or upon
notification by the Administrative Agent (acting at the direction of the
Required Lenders) to the Borrower of its obligations under this Section,
following the occurrence and during the continuation of any other Event of
Default, (i) an amount equal to that portion of all Letters of Credit
Outstandings attributable to the then aggregate amount which is undrawn and
available under all Letters of Credit issued and outstanding shall, without
demand upon or notice to the Borrower or any other Person, be deemed to have
been paid or disbursed by the Issuers of such Letters of Credit
(notwithstanding that such amount may not in fact have been paid or disbursed),
and (ii) the Borrower shall be immediately obligated to reimburse the Issuers
for the amount deemed to have been so paid or disbursed by such Issuers.
Amounts payable by the Borrower pursuant to this Section shall be deposited in
cash in immediately available funds with the Administrative Agent and held as
collateral security for the Reimbursement Obligations. When all Defaults giving
rise to the deemed disbursements under this Section have been cured or waived,
the Administrative Agent shall return to the Borrower all amounts then on
deposit with the Administrative Agent pursuant to this Section which have not
been applied to the satisfaction of the Reimbursement Obligations.
SECTION 2.6.5. Nature of Reimbursement Obligations. The Borrower, each
other Obligor and, to the extent set forth in Section 2.6.1, each Lender shall
assume all risks of the acts, omissions or misuse of any Letter of Credit by
the beneficiary thereof. No Issuer (except to the extent of its own gross
negligence or
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wilful misconduct or to the extent such Disbursement was otherwise wrongful
under the UCC) shall be responsible for (i) the form, validity, sufficiency,
accuracy, genuineness or legal effect of any document submitted by any party in
connection with the application for and issuance of a Letter of Credit, even if
it should in fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent or forged, (ii) the form, validity, sufficiency,
accuracy, genuineness or legal effect of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or the proceeds thereof in whole or in part, which may
prove to be invalid or ineffective for any reason, (iii) failure of the
beneficiary to comply fully with conditions required in order to demand payment
under a Letter of Credit, (iv) errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telegraph, telex or
otherwise, or (v) any loss or delay in the transmission or otherwise of any
document or draft required in order to make a Disbursement under a Letter of
Credit. None of the foregoing shall affect, impair or prevent the vesting of
any of the rights or powers granted to any Issuer or any Lender hereunder. In
furtherance and not in limitation or derogation of any of the foregoing, any
action taken or omitted to be taken by an Issuer in good faith (and not
constituting gross negligence or willful misconduct or to the extent such
Disbursement was otherwise wrongful under the UCC) shall be binding upon each
Obligor and each such Secured Party, and shall not put such Issuer under any
resulting liability to any Obligor or any Secured Party, as the case may be.
SECTION 2.7. Notes, etc. Each Lender's Revolving Loans under its
Commitment shall be evidenced by a Revolving Note payable to the order of such
Lender in a maximum principal amount equal to such Lender's Percentage of the
original applicable Commitment Amount, and the Swing Line Lender's Swing Line
Loans under its Swing Line Loan Commitment shall be evidenced by a Swing Line
Note payable to the order of the Swing Line Lender in a maximum principal
amount equal to the Swing Line Loan Commitment. The Borrower hereby irrevocably
authorizes each Lender (including the Swing Line Lender) to make (or cause to
be made) appropriate notations on the grid attached to such Lender's Revolving
Note or the Swing Line Note, as the case may be (or on any continuation of such
grid), which notations, if made, shall be prima facie evidence of (absent
manifest error), inter alia, the date of, the outstanding principal of, and the
type of interest rate and Interest Period applicable to the Loans evidenced
thereby; provided, however, that the failure of any Lender to make any such
notations shall not limit or otherwise affect any Obligations of any Obligor.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments; Application.
SECTION 3.1.1. Repayments and Prepayments. The Borrower shall repay in
full the unpaid principal amount of each Loan upon the Stated Maturity Date.
Prior thereto, payments and prepayments of Loans shall or may be made as set
forth below.
(a) From time to time on any Business Day, the Borrower may
make a voluntary prepayment, in whole or in part, of the outstanding
principal amount of any Loans, provided, however, that (i) with
respect to any Loans other than Swing Line Loans, (x) any such
prepayment shall be made pro rata among Loans of the same type and, if
applicable, having the same Interest Period, (y) all such voluntary
prepayments shall require at least one Business Day's notice in the
case
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of Base Rate Loans, three Business Days' notice in the case of LIBO
Rate Loans, but no more than seven Business Days' prior written notice
in the case of any Loans, in each case in writing to the
Administrative Agent, and (z) all such voluntary partial prepayments
shall be, in the case of LIBO Rate Loans, in an aggregate minimum
amount of $1,000,000 and an integral multiple of $100,000 and, in the
case of Base Rate Loans, in an aggregate minimum amount of $1,000,000
and an integral multiple of $100,000; and (ii) unless otherwise
provided in the Swing Line Loan Agreement, (x) Swing Line Loans may be
voluntarily prepaid at any time, followed by subsequent telephonic
notice to the Swing Lender on or before 3:00 p.m., Atlanta, Georgia
time, no later than the day following such prepayment (such notice to
be confirmed in writing if requested by the Swing Line Lender) and (y)
any such voluntary partial prepayment shall be in a minimum aggregate
amount of, and an integral multiple of, $10,000 or the aggregate
principal amount of all outstanding Swing Line Loans.
(b) On each date when the sum of (i) the aggregate
outstanding principal amount of all Loans and (ii) the aggregate
amount of all Letter of Credit Outstandings exceeds the lesser of (x)
the Revolving Loan Commitment Amount (as it may be reduced from time
to time, including pursuant to Section 2.2 and Section 3.1.2), and (y)
the then applicable Borrowing Base Amount, the Borrower shall make a
mandatory prepayment of all the Loans and, if necessary, give cash
collateral to the Administrative Agent pursuant to an agreement
satisfactory to the Administrative Agent to collateralize Letter of
Credit Outstandings, in an aggregate amount equal to such excess.
(c) The Borrower shall, not later than three Business Days
following the receipt of any Net Debt Proceeds by the Borrower or any
of its Subsidiaries, deliver to the Administrative Agent a calculation
of the amount of such Net Debt Proceeds and make a mandatory
prepayment of the Loans in an amount equal to 100% of such Net Debt
Proceeds to be applied as set forth in Section 3.1.2; provided, that
in no event shall any prepayment be required pursuant to this clause
(c) in an amount less than $1,000,000 until three Business Days after
the date on which the aggregate amount of all prepayments that, absent
this proviso, would have been required to have been made by this
clause (c) (and which in fact have not yet been made) is at least
$1,000,000.
(d) The Borrower shall, not later than three Business Days
following the receipt of any Net Equity Proceeds by the Borrower or
any of its Subsidiaries, deliver to the Administrative Agent a
calculation of the amount of such Net Equity Proceeds and make a
mandatory prepayment of the Loans in an amount equal to 50% of such
Net Equity Proceeds to be applied as set forth in Section 3.1.2;
provided that (i) this clause (d) shall not be applicable to any Net
Equity Proceeds arising from the issuance or sale of any stock,
warrants or options to employees, officers or directors of the
Borrower or any of its Subsidiaries pursuant to any compensation
arrangement, employee benefit plan or similar arrangement or the
exercise by any such employee, officer, director, plan or arrangement
of any such warrants or options; and (ii) in no event shall any
prepayment be required pursuant to this clause (d) in an amount less
than $1,000,000 until three Business Days after the date on which the
aggregate amount of all prepayments that, absent this clause (ii),
would have been required to have been made by this clause (d) (and
which in fact have not yet been made) is at least $1,000,000.
(e) The Borrower shall, following the receipt by the Borrower
or any of its Subsidiaries of any Casualty Proceeds in excess of
$5,000,000 (individually or in the aggregate (when taken together with
Net Disposition Proceeds) over the course of a Fiscal Year), deliver
to the Administrative Agent a calculation of the amount of such
Casualty Proceeds and make a mandatory prepayment of the
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Loans in an amount equal to 100% of such Casualty Proceeds within 60
days of the receipt thereof to be applied as set forth in Section
3.1.2; provided, however, that no mandatory prepayment on account of
Casualty Proceeds shall be required under this clause if the Borrower
informs the Agents in writing no later than 60 days following the
occurrence of the Casualty Event resulting in such Casualty Proceeds
of its or such Subsidiary's good faith intention either to (x) apply
such Casualty Proceeds to the rebuilding or replacement of the
damaged, destroyed or condemned assets or property, or (y) otherwise
reinvest such Casualty Proceeds, in a manner permitted by this
Agreement, in the business of the Borrower and its Subsidiaries
(including pursuant to clauses (e) and (j) of Section 7.2.5), and the
Borrower or such Subsidiary in fact so uses such Casualty Proceeds
within 365 days following the receipt of such Casualty Proceeds, with
the amount of such Casualty Proceeds unused after such 365-day period
being applied to the prepayment of the Loans pursuant to Section
3.1.2; provided, further, however, that (i) at any time when any Event
of Default shall have occurred and be continuing, all such Casualty
Proceeds (together with Net Disposition Proceeds not applied as
provided in clause (f) below) shall be deposited in an account of the
Borrower maintained with the Administrative Agent to pay for such
rebuilding, replacement or reinvestment whenever no Event of Default
is then continuing or except as otherwise agreed to by the Agents for
disbursement at the request of the Borrower or such Subsidiary, as the
case may be, it being agreed that all amounts so deposited shall be
disbursed to the Borrower at such time as no Event of Default has
occurred and is continuing, or (ii) if all such Casualty Proceeds
(together with Net Disposition Proceeds not applied as provided in
clause (f) below) aggregating in excess of $5,000,000 have not yet
been applied either (x) to the repayment of Loans, (y) as described in
the notice required above, or (z) in accordance with clause (f) below,
all such Casualty Proceeds and Net Disposition Proceeds shall be
deposited in an account of the Borrower maintained with the
Administrative Agent for disbursement at the request of the Borrower
or such Subsidiary, as the case may be, to be used for the purpose(s)
set forth in such written notice(s) or, at the election of the
Borrower, to repay Loans; provided, further that in no event shall any
prepayment be required pursuant to this clause (e) in an amount less
than $5,000,000 or any unused Casualty Proceeds aggregating less than
$5,000,000 until three Business Days after the end of any Fiscal
Quarter containing a date on which the aggregate amount of all
prepayments that, absent this proviso and the similar proviso to
clause (f) below, would have been required to have been made by this
clause (e) or such clause (f) (and which in fact have not yet been
made) is in excess of $5,000,000.
(f) The Borrower shall, following the receipt by the Borrower
or any of its respective Subsidiaries of any Net Disposition Proceeds
in excess of $5,000,000 (individually or in the aggregate (when taken
together with Casualty Proceeds) over the course of a Fiscal Year),
deliver to the Administrative Agent a calculation of the amount of
such Net Disposition Proceeds and make a mandatory prepayment of the
Loans in an amount equal to 100% of such Net Disposition Proceeds
within five Business Day of the receipt thereof to be applied as set
forth in Section 3.1.2; provided, however, that no mandatory
prepayment on account of Net Disposition Proceeds shall be required
under this clause if the Borrower informs the Agents in writing no
later than five Business Day following the receipt of such Net
Disposition Proceeds of its or such Subsidiary's good faith intention
to reinvest such Net Disposition Proceeds, in a manner permitted by
this Agreement, in the business of the Borrower and its Subsidiaries
(including pursuant to clauses (e) and (j) of Section 7.2.5), and the
Borrower or such Subsidiary in fact so uses such Net Disposition
Proceeds to replace such assets or property within 365 days of the
receipt of such Net Disposition Proceeds, with the amount of such Net
Disposition Proceeds unused after such 365-day period being applied to
the Loans pursuant to Section 3.1.2; provided, further, however, that
(i) at any time when any Event of
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Default shall have occurred and be continuing, all such Net
Disposition Proceeds (together with Casualty Proceeds not applied as
provided in clause (e) above) shall be deposited in an account of the
Borrower maintained with the Administrative Agent to pay for such
reinvestment whenever no Event of Default is then continuing or except
as otherwise agreed to by the Agent for disbursement at the request of
the Borrower or such Subsidiary, as the case may be, it being agreed
that all amounts so deposited shall be disbursed to the Borrower at
such time as no Event of Default has occurred and is continuing, or
(ii) if all such Net Disposition Proceeds (together with Casualty
Proceeds not applied as provided in clause (e) above) aggregating in
excess of $5,000,000 have not yet been applied to either (x) the
repayment of Loans, (y) as described in the notice required above, or
(z) in accordance with clause (e) above, all such Net Disposition
Proceeds and Casualty Proceeds shall be deposited in an account of the
Borrower maintained with the Administrative Agent for disbursement at
the request of the Borrower or such Subsidiary, as the case may be, to
be used for the purpose(s) set forth in such written notice(s) or, at
the election of the Borrower, to repay Loans; provided, further that
in no event shall any prepayment be required pursuant to this clause
(f) in an amount less than $5,000,000 or any unused Net Disposition
Proceeds aggregating less than $5,000,000 until three Business Days
after the end of any Fiscal Quarter containing a date on which the
aggregate amount of all prepayments that, absent this proviso and the
similar proviso to clause (e) above, would have been required to have
been made by this clause (f) or such clause (e) (and which in fact
have not yet been made) is in excess of $5,000,000.
(g) The Borrower shall, on each date when any reduction in
the Revolving Loan Commitment Amount shall become effective, make a
mandatory prepayment of Revolving Loans and Swing Line Loans and (if
necessary) deposit with the Administrative Agent cash collateral for
Letter of Credit Outstandings in an aggregate amount equal to the
excess, if any, of the sum of (i) the aggregate outstanding principal
amount of all Revolving Loans and Swing Line Loans and (ii) the
aggregate amount of all Letter of Credit Outstandings over the
Revolving Loan Commitment Amount as so reduced.
(h) The Borrower shall, immediately upon the occurrence of
the Stated Maturity Date of any Loans or Obligations, whether by way
of acceleration pursuant to Section 8.2 or 8.3 or otherwise, repay all
such outstanding Loans and other Obligations, unless, pursuant to
Section 8.3, only a portion of all Loans and other Obligations are so
accelerated (in which case only the portion so accelerated shall be so
prepaid).
Each prepayment of any Loans made pursuant to this Section shall be
without premium or penalty, except as may be required by Section 4.4. No
prepayment of principal of any Revolving Loans or Swing Line Loans pursuant to
this Section 3.1.1 shall cause a reduction in the Revolving Loan Commitment
Amount or the Swing Line Loan Commitment Amount, as the case may be.
SECTION 3.1.2. Application. Other than pursuant to the Swing Line
Account Agreement, each prepayment or repayment of the principal of the Loans
shall be applied, to the extent of such prepayment or repayment, first, to the
principal amount thereof being maintained as Base Rate Loans, and second, to
the principal amount thereof being maintained as LIBO Rate Loans; provided,
that mandatory prepayments of LIBO Rate Loans made pursuant to Section 3.1.1,
if not made on the last day of the Interest Period with respect thereto, shall
be prepaid subject to the provisions of Section 4.4 (together with a payment of
all accrued interest).
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SECTION 3.2. Interest Provisions. Interest on the outstanding
principal amount of Loans shall accrue and be payable in accordance with this
Section 3.2.
SECTION 3.2.1. Rates. Each Base Rate Loan shall accrue interest on the
unpaid principal amount thereof for each day from and including the day upon
which such Loan was made or converted to a Base Rate Loan to but excluding the
date such Loan is repaid or converted to a LIBO Rate Loan at a rate per annum
equal to the sum of the Alternate Base Rate for such day plus the Applicable
Margin for such Loan on such day. Each LIBO Rate Loan shall accrue interest on
the unpaid principal amount thereof for each day from and including the first
day of the Interest Period applicable thereto to but excluding the last day of
such Interest Period or, if different, the date such Loan is repaid or
converted to a Base Rate Loan at a rate per annum equal to the sum of the LIBO
Rate (Reserve Adjusted) for such Interest Period plus the Applicable Margin for
such Loan on such day.
SECTION 3.2.2. Post-Maturity Rates. After the date any principal
amount of any Loan or Reimbursement Obligation is due and payable (whether on
the Stated Maturity Date, upon acceleration or otherwise), or after any other
monetary Obligation of the Borrower shall have become due and payable, the
Borrower shall pay, but only to the extent permitted by law, interest (after as
well as before judgment) on such amounts that are overdue at a rate per annum
equal to the Alternate Base Rate plus the Applicable Margin (as then in effect)
plus a margin of 2%.
SECTION 3.2.3. Payment Dates. Interest accrued on each Loan shall be
payable, without duplication:
(a) on the Stated Maturity Date therefor;
(b) on the date of any payment or prepayment, in whole or in
part, of principal outstanding on such Loan on the principal amount so
paid or prepaid;
(c) with respect to Base Rate Loans, on each Quarterly
Payment Date occurring after the initial Credit Extension hereunder;
(d) with respect to LIBO Rate Loans, on the last day of each
applicable Interest Period (and, if such Interest Period shall exceed
three months, at intervals of three months after the first day of such
Interest Period); and
(e) on that portion of any Loans the Stated Maturity Date of
which is accelerated pursuant to Section 8.2 or Section 8.3,
immediately upon such acceleration.
Interest accrued on Loans or other monetary Obligations arising under this
Agreement or any other Loan Document after the date such amount is due and
payable (whether on the Stated Maturity Date, upon acceleration or otherwise)
shall be payable upon demand.
SECTION 3.3. Fees. The Borrower agrees to pay the fees set forth in
this Section 3.3. All such fees shall be non-refundable.
SECTION 3.3.1. Commitment Fee. The Borrower agrees to pay to the
Administrative Agent for the account of each Lender, for the period (including
any portion thereof when any of its Commitments are
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suspended by reason of the Borrower's inability to satisfy any condition of
Article V) commencing on the Effective Date and continuing through but
excluding the Commitment Termination Date, a commitment fee in an amount equal
to the Applicable Commitment Fee, in each case on such Lender's Percentage of
the sum of the average daily unused portion of the applicable Commitment
Amount, whether or not then available. All commitment fees payable pursuant to
this Section shall be calculated on a year comprised of 365 or 366 days (as
applicable) and payable by the Borrower in arrears on the Effective Date and
thereafter on each Quarterly Payment Date, commencing with the first Quarterly
Payment Date following the Effective Date, and on the Commitment Termination
Date. The making of Swing Line Loans by the Swing Line Lender shall not
constitute usage under the Commitment for the purpose of calculating the
commitment fees to be paid by the Borrower to the Lenders (including the Swing
Line Lender) pursuant to Section 3.3.1; provided, that Letter of Credit
Outstandings shall constitute usage for such purpose.
SECTION 3.3.2. Agent's Fee. The Borrower agrees to pay to each Agent,
for its own account, the fees, if any, payable to such Agent pursuant to the
Fee Letters in the amounts and on the dates set forth therein.
SECTION 3.3.3. Letter of Credit Fee. The Borrower agrees to pay to
(a) the Administrative Agent, for the pro rata account of the
Issuer and each other Lender that has a Revolving Loan Commitment, a
Letter of Credit fee for each day (other than the last day) on which
there shall be any Letters of Credit outstanding in an amount equal to
the product of (i) a rate per annum equal to the then Applicable
Margin for Revolving Loans maintained as LIBO Rate Loans multiplied by
(ii) the Stated Amount of each such Letter of Credit; and
(b) the Issuer (i) a Letter of Credit fronting fee for each
day (other than the last day) on which there shall be any Letters of
Credit outstanding in an amount equal to 0.25% per annum on the Stated
Amount of each such Letter of Credit, and (ii) from time to time
promptly after demand, the normal issuance, presentation, amendment
and other processing fees, and other standard administrative costs and
charges of the Issuer relating to Letters of Credit as from time to
time in effect and notified to the Borrower.
Fees payable pursuant to this Section shall be payable quarterly in arrears on
each Quarterly Payment Date and on the Revolving Loan Commitment Termination
Date.
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 4.1. LIBO Rate Lending Unlawful. If any Lender shall determine
(which determination shall, upon notice thereof to the Borrower and the
Lenders, be conclusive and binding on the Borrower) that the introduction of or
any change in or in the interpretation of any law makes it unlawful, or any
central bank or other governmental authority asserts that it is unlawful, for
such Lender to make, continue or maintain any Loan as, or to convert any Loan
into, a LIBO Rate Loan, the obligations of such Lender to make, continue,
maintain or convert any such LIBO Rate Loan shall, upon such determination,
forthwith be suspended until the circumstances causing such suspension no
longer exist, and all outstanding LIBO Rate Loans shall automatically convert
into Base Rate Loans at the end of the then current Interest Periods with
respect thereto
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or sooner, if required by such law or assertion. Any Lender so affected shall
give prompt notice thereof the Borrower of such circumstances and the cessation
thereof.
SECTION 4.2. Deposits Unavailable. If no Telerate page (or successor
thereto) shall exist and the Administrative Agent shall have determined that
either (i) Dollar deposits in the relevant amount and for the relevant Interest
Period are not generally available in the London interbank market or (ii) by
reason of circumstances affecting such relevant market, adequate means do not
exist for purposes of ascertaining the interest rate applicable hereunder to
LIBO Rate Loans, then, upon notice from the Administrative Agent to the
Borrower and the Lenders, the obligations of all Lenders under Section 2.3 and
Section 2.4 to make or continue any Loans as, or to convert any Loans into,
LIBO Rate Loans shall forthwith be suspended until the circumstances causing
such suspension no longer exist. The Administrative Agent shall give prompt
notice thereof to the Borrower of such circumstances and the cessation thereof.
SECTION 4.3. Increased LIBO Rate Loan Costs, etc. Subject to the terms
hereof, the Borrower agrees to reimburse each Lender for any increase in the
cost to such Lender of, or any reduction in the amount of any sum receivable by
such Lender in respect of, making, continuing or maintaining (or of its
obligation to make, continue or maintain) any Loans as, or of converting (or of
its obligation to convert) any Loans into, LIBO Rate Loans that arise in
connection with any change in, or the introduction, adoption, effectiveness,
interpretation or reinterpretation after the date hereof of, any law or
regulation, directive, guideline, decision or request (whether or not having
the force of law) of any court, central bank, regulator or other governmental
authority, except for such changes with respect to increased capital costs and
taxes, which shall be governed by Sections 4.5 and 4.6, respectively, or
reflected in the LIBO Rate (Reserve Adjusted). Such Lender shall promptly
notify the Administrative Agent and the Borrower in writing of the occurrence
of any such event, such notice to state, in reasonable detail, the reasons
therefor and the additional amount required fully to compensate such Lender for
such increased cost or reduced amount. Such additional amounts which have not
accrued for more than 90 days prior to the date on which such Lender actually
became aware of such additional amounts shall be payable by the Borrower
directly to such Lender within five Business Days of its receipt of such
notice, and such notice shall, in the absence of bad faith or manifest error,
be conclusive and binding on the Borrower.
SECTION 4.4. Funding Losses. In the event any Lender shall incur any
loss or expense (including any loss or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such Lender
to make, continue or maintain any portion of the principal amount of any Loan
as, or to convert any portion of the principal amount of any Loan into, a LIBO
Rate Loan) as a result of (i) any conversion or repayment or prepayment of the
principal amount of any LIBO Rate Loans on a date other than the scheduled last
day of the Interest Period applicable thereto, whether pursuant to Section 3.1
or otherwise, (ii) any Loans not being made as LIBO Rate Loans in accordance
with the Borrowing Request therefor, or (iii) any Loans not being continued as,
or converted into, LIBO Rate Loans in accordance with the
Continuation/Conversion Notice therefor, then, upon the written notice of such
Lender to the Borrower (with a copy to the Administrative Agent), the Borrower
shall, within five Business Days of its receipt thereof, pay directly to such
Lender such amount as will (in the reasonable determination of such Lender)
reimburse such Lender for such loss or expense. Such written notice (which
shall include calculations in reasonable detail) shall, in the absence of bad
faith or manifest error, be conclusive and binding on the Borrower. In no event
shall the amount the Borrower is obligated to pay to any Lender pursuant to this
Section exceed the excess, if any, of (i) the amount of interest (exclusive of
any Applicable Margin) which would have accrued on the amount so prepaid or
converted, or not so borrowed, converted or continued, for the period from and
including the date of such event to but excluding that last day of the Interest
Period (or proposed Interest
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Period) for the applicable Loans at the applicable LIBO Rate (or proposed LIBO
Rate) for such Loans over (ii) the amount of interest (as reasonably determined
by such Lender) which would have accrued to such Lender on such amount by
placing such amount on deposit for a comparable period with leading banks in
the interbank eurodollar market; it being understood that the Borrower shall
not be required to indemnify any Lender for any lost profits.
SECTION 4.5. Increased Capital Costs. If any change in, or the
introduction, adoption, effectiveness, interpretation or reinterpretation of,
any law or regulation, directive, guideline, decision or request (whether or
not having the force of law) of any court, central bank, regulator or other
governmental authority affects or would affect the amount of capital required
or expected to be maintained by any Lender, the Issuer or any Person
controlling such Lender or the Issuer (exclusive, however, of adjustments
reflected in the LIBO Rate (Reserve Adjusted)), and such Lender or the Issuer
determines (in good faith but in its sole and absolute discretion) that the
rate of return on its or such controlling Person's capital as a consequence of
the Commitments, participation in, or the issuance or extension of, any Letter
of Credit or any Loan made, or the Letters of Credit participated in, by such
Lender is reduced to a level below that which such Lender, the Issuer or such
controlling Person could have achieved but for the occurrence of any such
circumstance, then, in any such case upon notice from time to time by such
Lender or the Issuer to the Borrower, the Borrower shall immediately pay
directly to such Lender or the Issuer additional amounts which have not accrued
for more than 90 days prior to the date on which such Lender or the Issuer
became aware of such additional amounts sufficient to compensate such Lender,
the Issuer or such controlling Person for such reduction in rate of return. A
statement of such Lender or the Issuer as to any such additional amount or
amounts (including calculations thereof in reasonable detail) shall, in the
absence of bad faith or manifest error, be conclusive and binding on the
Borrower. In determining such amount, such Lender or the Issuer may use any
method of averaging and attribution that it (in its sole and absolute
discretion) shall deem applicable.
SECTION 4.6. Taxes. All payments by the Borrower of principal of, and
interest on, the Credit Extensions and all other amounts payable hereunder
(including fees) shall be made free and clear of and without deduction for any
present or future income, excise, stamp or franchise taxes and other taxes,
fees, duties, withholdings or other charges of any nature whatsoever imposed by
any taxing authority, but excluding (i) franchise taxes and taxes imposed on or
measured by any Lender's, Agent's or Issuer's net income or net receipts and
(ii) any present or future income, excise, stamp or franchise taxes and other
taxes, fees, duties, withholdings or other charges of any nature whatsoever
imposed by the United States or any political subdivision in or of the United
States to the extent they are in effect and would apply as of the date any
Person becomes a Lender, Agent or Issuer (but not to the extent imposed as a
result of a change in law, treaties, regulation or an interpretation thereof
occurring after the date hereof), or to the extent imposed as a result of a
change in a Lender's, Agent's or Issuer's circumstances, including without
limitation a change in the residence, place of incorporation, or principal
place of business of such Person or as a result of a change in the branch or
lending office of such Person participating in the transactions set forth
herein (other than a change made at the request of the Borrower), and the
foregoing clauses (i) and (ii) shall include all penalties, interest or
expenses related thereto (such non-excluded items being called "Taxes"). In the
event that any withholding or deduction from any payment to be made by the
Borrower hereunder is required in respect of any Taxes pursuant to any
applicable law, rule or regulation, then the Borrower will (x) pay directly to
the relevant authority the full amount required to be so withheld or deducted,
(y) promptly forward to the Administrative Agent an official receipt or other
documentation satisfactory to the Administrative Agent evidencing such payment
to such authority, and (z) pay to the Administrative Agent for the account of
such Lender, Agent or Issuer, as applicable, such additional amount or amounts
as is necessary to ensure that the net amount actually received by such Person
will equal the full amount such Person would have received had
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no such withholding or deduction been required; provided, however, that the
Borrower shall not be required to increase any such amounts payable to any
Lender, Agent or Issuer (A) that is not organized under the laws of the United
States to the extent that such Taxes are imposed on such Lender, Agent or
Issuer, as the case may be, as a result of the failure of such Person to comply
with the requirements of the last paragraph of this Section 4.6, or (B) to the
extent the increase in such amount payable results solely from the Lender's,
Agent's or Issuer's own wilful misconduct or gross negligence. Moreover, if any
Taxes are directly asserted against any Lender, Agent or Issuer with respect to
any payment received by such Person hereunder, such Person may pay such Taxes
and the Borrower will promptly pay such additional amounts (including any
penalties, interest or expenses) as is necessary in order that the net amount
received by such person after the payment of such Taxes (including any Taxes on
such additional amount) shall equal the amount such person would have received
had not such Taxes been asserted.
If the Borrower fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the Administrative Agent, for the account
of any Lender, Agent or Issuer, as applicable, the required receipts or other
required documentary evidence, the Borrower shall indemnify such Lender, Agent
or Issuer, as the case may be, for any incremental Taxes, interest or penalties
that may become payable by any such Person as a result of any such failure.
If any Lender, Agent or Issuer determines in its sole good faith
judgment that it has received a refund (including interest and penalties, if
any) of any Taxes as to which it has been indemnified by the Borrower pursuant
to this Section 4.6, it shall promptly notify the Borrower of such refund and
shall, within 90 days of receipt repay such refund (to the extent of amounts
that have been paid by the Borrower under this Section 4.6 with respect to such
Taxes and not previously reimbursed) to the Borrower and without any interest
(other than the interest, if any, attributable to such refund that is actually
received from the relevant taxing authority), provided that the Borrower, upon
the request of such Lender, Agent or Issuer agrees to return such refunded
amount to such Lender, Agent or Issuer in the event such Person is required to
repay such refund. The Borrower shall return such refund within 30 days after
such Lender, Agent or Issuer provides the Borrower with written notice that it
is required by applicable law to repay such refund to the relevant taxing
authority. Any such amounts returned by the Borrower shall be treated as a
payment subject to the provisions of this Section 4.6. The Borrower
acknowledges that nothing contained in this paragraph shall require any Lender,
Agent or Issuer to make any application for a refund of any Taxes or otherwise
affect its discretion over its fiscal affairs.
Each Lender, Agent or Issuer that is organized under the laws of a
jurisdiction other than the United States shall, prior to the due date of any
payments under this Agreement and thereafter on or about the first scheduled
payment date in each Fiscal Year and at any other time that the Borrower or the
Administrative Agent may reasonably request, execute and deliver to the
Borrower and the Administrative Agent one or more (as the Borrower or the
Administrative Agent may reasonably request) United States Internal Revenue
Service Forms 4224 or Forms 1001 (or successor forms or documents) or such
other forms or documents, appropriately completed, as may be applicable to
establish the extent, if any, to which a payment to such Lender, Agent or
Issuer is exempt from withholding or deduction of Taxes.
SECTION 4.7. Payments, Computations, etc. Unless otherwise expressly
provided, all payments by the Borrower pursuant to this Agreement, the Notes,
each Letter of Credit or any other Loan Document shall be made by the Borrower
to the Administrative Agent for the pro rata account of the Lenders entitled to
receive such payment. All such payments required to be made to the
Administrative Agent shall be made, without setoff, deduction or counterclaim,
not later than 1:00 p.m., New York, N.Y. or Atlanta, Georgia time,
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on the date due, in same day or immediately available funds, to such account in
Atlanta, Georgia as the Administrative Agent shall specify from time to time by
notice to the Borrower. Funds received after that time shall be deemed to have
been received by the Administrative Agent on the next succeeding Business Day.
The Administrative Agent shall promptly remit in same day funds to each Lender,
Agent or Issuer, as the case may be, its share, if any, of such payments
received by the Administrative Agent for the account of such Lender. All
interest and fees shall be computed on the basis of the actual number of days
(including the first day but excluding the last day) occurring during the
period for which such interest or fee is payable over a year comprised of 360
days (or, in the case of the commitment fee described in Section 3.3.1 and
interest on a Base Rate Loan (calculated at other than the Federal Funds Rate),
365 days or, if appropriate, 366 days). Whenever any payment to be made shall
otherwise be due on a day which is not a Business Day, such payment shall
(except as otherwise required by clause (ii) of the definition of the term
"Interest Period") be made on the next succeeding Business Day and such
extension of time shall be included in computing interest and fees, if any, in
connection with such payment.
SECTION 4.8. Sharing of Payments. If any Lender shall obtain any
payment or other recovery (whether voluntary, involuntary, by application of
setoff or otherwise) on account of any Loan or Reimbursement Obligation (other
than pursuant to the terms of Section 4.3, 4.4, 4.5 or 4.6) in excess of its
pro rata share of payments then or therewith obtained by all Lenders, such
Lender shall purchase from the other Lenders such participations in Credit
Extensions made by them as shall be necessary to cause such purchasing Lender
to share the excess payment or other recovery ratably with each of them;
provided, however, that if all or any portion of the excess payment or other
recovery is thereafter recovered from such purchasing Lender, the purchase
shall be rescinded and each Lender which has sold a participation to the
purchasing Lender shall repay to the purchasing Lender the purchase price to
the ratable extent of such recovery together with an amount equal to such
selling Lender's ratable share (according to the proportion of (i) the amount
of such selling Lender's required repayment to the purchasing Lender, to (ii)
total amount so recovered from the purchasing Lender) of any interest or other
amount paid or payable by the purchasing Lender in respect of the total amount
so recovered. The Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to this Section may, to the fullest extent
permitted by law, exercise all its rights of payment (including pursuant to
Section 4.9) with respect to such participation as fully as if such Lender were
the direct creditor of the Borrower in the amount of such participation. If
under any applicable bankruptcy, insolvency or other similar law, any Lender
receives a secured claim in lieu of a setoff to which this Section applies,
such Lender shall, to the extent practicable, exercise its rights in respect of
such secured claim in a manner consistent with the rights of the Lenders
entitled under this Section to share in the benefits of any recovery on such
secured claim.
SECTION 4.9. Setoff. Each Lender shall, upon the occurrence and during
the continuance of any Default described in clauses (a) through (d) of Section
8.1.9 or, with the consent of the Required Lenders, upon the occurrence and
during the continuance of any Event of Default described in Section 8.1.1 or
any acceleration of the Obligations (in whole or in part), have the right to
appropriate and apply to the payment of the Obligations owing to it (whether or
not then due), and (as security for such Obligations) the Borrower hereby
grants to each Lender a continuing security interest in, any and all balances,
credits, deposits, accounts or moneys of the Borrower then or thereafter
maintained with such Lender; provided, however, that any such appropriation and
application shall be subject to the provisions of Section 4.8. Each Lender
agrees promptly to notify the Borrower and the Administrative Agent after any
such setoff and application made by such Lender; provided, however, that the
failure to give such notice shall not affect the validity of such setoff and
application. The rights of each Lender under this Section are in addition to
other rights and remedies (including other rights of setoff under applicable
law or otherwise) which such Lender may have.
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SECTION 4.10. Replacement of Lenders. Each Lender hereby severally
agrees as set forth in this Section. If any Lender (an "Affected Lender") makes
demand upon the Borrower for (or if the Borrower is otherwise required to pay)
amounts pursuant to Section 4.3, 4.5, or 4.6, and the payment of such
additional amounts are, and are likely to continue to be, materially greater in
the reasonable judgment of the Borrower than with respect to the other Lenders,
or if its Loans are effected by the circumstances described in Section 4.1, the
Borrower may, within 30 days of receipt by the Borrower of such demand or
notice (or the occurrence of such other event causing the Borrower to be
required to pay such compensation), as the case may be, give notice (a
"Replacement Notice") in writing to the Agents and such Affected Lender of its
intention to replace such Affected Lender with another financial institution (a
"Replacement Lender") designated in such Replacement Notice. If the Agents
shall, in the exercise of their reasonable discretion and within 30 days of
their receipt of such Replacement Notice, notify the Borrower and such Affected
Lender in writing that the designated financial institution is satisfactory to
the Agents (such consent not being required where the Replacement Lender is
already a Lender, and otherwise not to be unreasonably withheld), then such
Affected Lender shall, subject to the payment of any amounts due pursuant to
Section 4.4, assign, in accordance with Section 10.11.1, all of its
Commitments, Loans, Notes and other rights and obligations under this Agreement
and all other Loan Documents (including Reimbursement Obligations, if
applicable) to such designated financial institution; provided, however, that
(i) such assignment shall be without recourse, representation or warranty
(other than as to free and clear ownership) and shall be on terms and
conditions consistent with those set forth in Section 10.11.1, (ii) the
purchase price paid by such designated financial institution shall be in the
amount of such Affected Lender's Loans and its Percentage of outstanding
Reimbursement Obligations, together with all accrued and unpaid interest and
fees in respect thereof, plus (to the extent not paid by the Borrower) all
other amounts (including the amounts demanded and unreimbursed under Sections
4.3, 4.5 and 4.6), owing to such Affected Lender hereunder and (iii) the
Borrower shall pay to the Affected Lender and the Administrative Agent all
reasonable out-of-pocket expenses incurred by the Affected Lender and the
Administrative Agent in connection with such assignment and assumption
(including the processing fees described in Section 10.11.1). Upon the
effective date of an assignment described above, the Replacement Lender shall
become a "Lender" for all purposes under this Agreement and the other Loan
Documents and the Affected Lender shall cease to be such.
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
SECTION 5.1. Initial Credit Extension. The obligations of the
Lenders and, if applicable, the Issuer to fund the initial Credit Extension
shall be subject to the prior or concurrent satisfaction of each of the
conditions precedent set forth in this Section 5.1.
SECTION 5.1.1. Resolutions, etc. The Agents shall have received from
each Obligor, as applicable, (i) a copy of a good standing certificate, dated a
date reasonably close to the Effective Date, for each such Obligor and (ii) a
certificate, dated the date of the initial Credit Extension and with
counterparts for each Lender, duly executed and delivered by such Obligor's
Secretary or Assistant Secretary or managing member, as applicable, as to
(a) resolutions of each such Obligor's Board of Directors (or
other managing body, in the case of other than a corporation) then in
full force and effect authorizing the execution, delivery and
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performance of this Agreement and each other Loan Document to be
executed by such Obligor and the transactions contemplated hereby and
thereby;
(b) the incumbency and signatures of those of its officers or
managing member, as applicable, authorized to act with respect to this
Agreement and each other Loan Document to be executed by such Obligor;
and
(c) the full force and validity of each Organic Document of
such Obligor and copies thereof.
The Agents, each Lender and the Issuer may conclusively rely upon such
certificates until it shall have received a further certificate of the
Secretary, Assistant Secretary or managing member, as applicable, of any such
Obligor canceling or amending the prior certificate of such Obligor.
SECTION 5.1.2. Closing Date Certificate. The Agents shall have
received, with counterparts for each Lender, the Borrower Closing Date
Certificate, dated the date of the initial Credit Extension and duly executed
and delivered by an Authorized Officer of the Borrower, in which certificate
the Borrower shall agree and acknowledge that the statements made therein shall
be deemed to be true and correct representations and warranties of the Borrower
as of such date, and, at the time each such certificate is delivered, such
statements shall in fact be true and correct. All documents and agreements
required to be appended to the Closing Date Certificate shall be in form and
substance reasonably satisfactory to the Arranger.
SECTION 5.1.3. Delivery of Notes. The Administrative Agent shall have
received, for the account of each Lender, such Lender's Note (including the
Swing Line Lender's Swing Line Note) duly executed and delivered by an
Authorized Officer of the Borrower.
SECTION 5.1.4. Pledge Agreement. The Administrative Agent shall have
received, with counterparts for each Lender,
(a) the Pledge Agreement, dated the date hereof, duly
executed and delivered by an Authorized Officer of the Borrower and
each Guarantor that has any U.S. Subsidiaries that are Guarantors,
together with
(i) certificates evidencing all of the issued and
outstanding shares of Capital Stock owned by (x) the Borrower
in each Guarantor and (y) such Guarantor in each such
Subsidiary (other than BSG Government Solutions, Inc.), which
certificates shall be accompanied by undated stock powers
duly executed in blank; and
(ii) all Pledged Instruments (as defined in the
Pledge Agreement), if any, evidencing Indebtedness payable to
the Borrower or such Guarantor duly endorsed to the order of
the Administrative Agent, together with Uniform Commercial
Code Financing Statements (or similar instruments) in respect
of such Pledged Instruments executed by the Borrower or such
Guarantor to be filed in such jurisdictions as the Arranger
may reasonably request;
provided, that if any securities pledged pursuant to the Pledge
Agreement are uncertificated securities or are held through a
financial intermediary, the Administrative Agent shall have received
confirmation and evidence satisfactory to it that appropriate book
entries have been made in the
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relevant books or records of a financial intermediary or the issuer of
such securities, as the case may be, or other appropriate steps have
been taken under applicable law resulting in the perfection of the
security interest granted in favor of the Administrative Agent in such
securities pursuant to the terms of the Pledge Agreement; and
(b) the Agents and their counsel shall be reasonably
satisfied that the Lien granted to the Administrative Agent, for the
benefit of the Secured Parties in the Collateral described above is,
subject to Permitted Liens, a first priority security interest; and no
Lien exists on any of the Collateral described above other than the
Lien created in favor of the Administrative Agent, for the benefit of
the Secured Parties, pursuant to a Loan Document and Permitted Liens.
SECTION 5.1.5. Subsidiary Guaranty. The Agents shall have received,
with counterparts for each Lender, a Subsidiary Guaranty, dated the date
hereof, duly executed and delivered by each Guarantor.
SECTION 5.1.6. Security Agreement. The Agents shall have received,
with counterparts for each Lender, executed counterparts of the Security
Agreement, dated as of the date hereof, duly executed by the Borrower and each
Guarantor, together with
(a) executed copies of Uniform Commercial Code financing
statements (Form UCC-1), naming each Obligor under the Security
Agreement as a debtor and the Administrative Agent as the secured
party, or other similar instruments or documents, to be filed under
the Uniform Commercial Code in all jurisdictions as may be necessary
or, in the reasonable opinion of the Arranger, desirable to perfect
the security interests of the Administrative Agent pursuant to the
Security Agreement;
(b) to the extent the Arranger may reasonably request,
executed copies of proper Uniform Commercial Code Form UCC-3
termination statements, if any, necessary to release all Liens and
other rights of any Person other than Permitted Liens (i) in any
Collateral described in the Security Agreement previously granted by
any Person, and (ii) in respect of any of the Indebtedness identified
in Item 7.2.2(b) of the Disclosure Schedule, together with such other
Uniform Commercial Code Form UCC-3 termination statements as the
Arranger may reasonably request from such Obligors; and
(c) certified copies of Uniform Commercial Code Requests for
Information or Copies (Form UCC-11), or a similar search report
certified by a party acceptable to the Administrative Agent, dated a
date reasonably near to the date of the initial Credit Extension,
listing searches conducted in such jurisdictions as are reasonably
satisfactory to the Arranger, together with copies of the results of
such searches.
SECTION 5.1.7. Copyright Security Agreement and Trademark Security
Agreement. The Administrative Agent shall have received the Copyright Security
Agreement and the Trademark Security Agreement, as applicable, each dated as of
the date hereof, duly executed and delivered by the applicable Obligor.
SECTION 5.1.8. Financial Information, etc. The Agents shall have
received, with counterparts for each Lender,
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(a) audited consolidated financial statements of the Borrower
and its Subsidiaries for the Fiscal Years ended December 31, 1995,
December 31, 1996 and December 31, 1997, in each case reasonably
satisfactory in all material respects to the Arranger; and
(b) a Borrowing Base Certificate, dated the date of the
initial Credit Extension and calculated as of the calendar year ended
immediately prior to such date, duly executed (with all schedules
thereto completed) and delivered by an Authorized Officer of the
Borrower.
SECTION 5.1.9. Compliance Certificate. The Agents shall have
received, with counterparts for each Lender, an initial Compliance Certificate
on a pro forma basis as if the Credit Extension to be made on the date of the
initial Borrowing, the issuance of the Senior Notes and the application of the
net proceeds thereof had occurred as of December 31, 1997 and as to such items
therein as the Agents reasonably request, dated the date of the initial Credit
Extension, duly executed (and with all schedules thereto duly completed) and
delivered by a Responsible Officer of the Borrower.
SECTION 5.1.10. Purchase and Sale of Senior Notes, etc. The Borrower
shall have issued and sold the Senior Notes and received gross proceeds of
$175,000,000 from such issuance and sale. The Arranger shall be reasonably
satisfied with all terms and conditions of the Senior Notes, the Senior Note
Indenture and all other Senior Note Documents.
SECTION 5.1.11. Perfection Certificate. The Agents shall have received
a Perfection Certificate, dated as of the date of the initial Credit Extension,
duly executed and delivered by an Authorized Officer of each Obligor that is a
party thereto.
SECTION 5.1.12. Payment of Outstanding Indebtedness, etc. All Bridge
Notes and all other Indebtedness identified in Item 7.2.2(b) ("Indebtedness to
be Paid") of the Disclosure Schedule, together with all interest, all
prepayment premiums and other amounts due and payable with respect thereto,
shall have been paid in full from the proceeds of the initial Credit Extension
and the Senior Notes and the commitments in respect of such Indebtedness shall
have been terminated, and all Liens securing payment of any such Indebtedness
shall have been released and the Administrative Agent shall have received all
Uniform Commercial Code Form UCC-3 termination statements or other instruments
as may be suitable or appropriate in connection therewith.
SECTION 5.1.13. Litigation. There shall exist no pending or threatened
material litigation, proceedings or investigations which (x) contests the
consummation of the Transaction or the legality or validity of this Agreement,
any other Loan Document or any Senior Note Document or (y) except as disclosed
in any filing of the Borrower on Form 10-Q, Form 10-K or Form 8-K with the SEC
on or prior to February 13, 1998, could reasonably be expected to have a
Material Adverse Effect.
SECTION 5.1.14. Material Adverse Change. Except as disclosed in any
filing of the Borrower on Form 10-Q, Form 10-K or Form 8-K with the SEC on or
prior to February 13, 1998, there shall have occurred no material adverse
change in the business condition (financial or otherwise), operations,
performance, properties or prospects of the Borrower and its Subsidiaries,
taken as a whole, since December 31, 1997.
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SECTION 5.1.15. Approvals. All necessary governmental, shareholders'
and third-party Permits and approvals in connection with the Transaction and
the execution, delivery and performance of this Agreement and the other Loan
Documents and Senior Note Documents shall have been duly obtained.
SECTION 5.1.16. Insurance. The Agents shall have received, with copies
for each Lender, a summary of all insurance policies of the Borrower and its
Subsidiaries, which policies evidence coverage required to be maintained
pursuant hereto and to each Loan Document.
SECTION 5.1.17. Opinions of Counsel. The Agents shall have received
opinions, dated the date of the initial Credit Extension and addressed to the
Administrative Agent and all Lenders, from
(a) Skadden, Arps, Slate, Meagher & Flom LLP, special New
York and California counsel to the Obligors;
(b) Randy Hutto, general counsel to the Obligors; and
(c) Paul, Hastings & Janofsky, special Georgia counsel to
the Obligors.
SECTION 5.1.18. Other Representations and Warranties. Each of the
representations and warranties of the Borrower and its Subsidiaries set forth
in the Senior Note Documents shall be true and correct in all material
respects.
SECTION 5.1.19. Closing Fees, Expenses, etc. Each of the Agents shall
have received for its own respective account, or for the account of each
Lender, as the case may be, all fees, costs and expenses due and payable
pursuant to Sections 3.3 and 10.3, if then invoiced.
SECTION 5.2. All Credit Extensions. The obligation of each Lender
and each Issuer to make any Credit Extension (including the initial Credit
Extension) shall be subject to Sections 2.1.3 and 2.1.4 and the satisfaction of
each of the conditions precedent set forth in this Section 5.2.
SECTION 5.2.1. Compliance with Warranties, No Default, etc. Both
immediately before and after giving effect to any Credit Extension, the
following statements shall be true and correct:
(a) the representations and warranties set forth in Article
VI (excluding, however, those contained in Section 6.6) and in each
other Loan Document shall, in each case, be true and correct in all
material respects with the same effect as if then made (unless stated
to relate solely to an earlier date, in which case such
representations and warranties shall be true and correct in all
material respects as of such earlier date);
(b) the sum of (i) the aggregate outstanding principal amount
of all Loans, plus (ii) the aggregate amount of all Letter of Credit
Outstandings, does not exceed the lesser of (x) the then existing
Revolving Loan Commitment Amount and (y) the then applicable Borrowing
Base Amount;
(c) except as disclosed by the Borrower to the Agents and the
Lenders pursuant to Section 6.6,
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(i) no litigation, arbitration or governmental
investigation or proceeding shall be pending or, to the
knowledge of an officer of the Borrower, threatened against
the Borrower or any of its Subsidiaries which could
reasonably be expected to have a Material Adverse Effect, or
which would adversely affect the legality, validity or
enforceability of this Agreement or any other Loan Document;
and
(ii) no development shall have occurred in any
litigation, arbitration or governmental investigation or
proceeding disclosed pursuant to Section 6.6 which could
reasonably be expected to have a Material Adverse Effect; and
(d) no Default shall have then occurred and be continuing.
SECTION 5.2.2. Credit Extension Request, etc. The Administrative Agent
shall have received a Borrowing Request if Loans are being requested, or an
Issuance Request if a Letter of Credit is being requested or extended. Each of
the delivery of a Borrowing Request or Issuance Request and the acceptance by
the Borrower of the proceeds of such Credit Extension shall constitute a
representation and warranty by the Borrower that on the date of such Credit
Extension (both immediately before and after giving effect to such Credit
Extension and the application of the proceeds thereof) the statements made in
Section 5.2.1 are true and correct in all material respects.
SECTION 5.2.3. Satisfactory Legal Form. All documents executed or
submitted pursuant hereto by or on behalf of the Borrower or any of its
Subsidiaries or any other Obligors shall be reasonably satisfactory in form and
substance to the Agents and their counsel; the Agents and their counsel shall
have received all information, approvals, opinions, documents or instruments as
the Agents or their counsel may reasonably request.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Secured Parties to enter into this Agreement
and to make Credit Extensions hereunder, the Borrower represents and warrants
to each Secured Party as set forth in this Article.
SECTION 6.1. Corporate Existence and Power. The Borrower and each of
its Subsidiaries (i) is a corporation or other entity, validly existing and in
good standing (and duly incorporated in the case of a corporation) under the
laws of its jurisdiction of organization (or incorporation in the case of a
corporation), and (ii) has all corporate or other powers and all governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted and as proposed to be conducted; except, in each
case, where any failure of the foregoing to be true would not reasonably be
expected to have a Material Adverse Effect.
SECTION 6.2. Authorization, Execution and Enforceability; Lien
Perfection.
(a) The execution, delivery and performance by the Borrower
and each of its Subsidiaries of this Agreement and each other Loan
Document to which it is a party and the issuance of the Notes by the
Borrower have been duly and validly authorized and are within its
corporate or other powers.
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Each of the Loan Documents (including the Notes) has been duly
executed and delivered by the Borrower and each of its Subsidiaries
party thereto and constitutes its valid and binding agreement,
enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium and other similar
laws affecting creditors' rights generally and equitable principles of
general applicability.
(b) Each Collateral Document (together with the delivery to
the Administrative Agent of any instrument and certificated
securities) creates valid and binding Liens in the Collateral
purported to be covered thereby, and upon completion of the actions
and filings described in the Collateral Documents and Perfection
Certificate such Liens, to the extent the same may be perfected under
Articles 8 or 9 of the UCC, will constitute perfected Liens, subject
to no prior or equal Lien other than Permitted Liens.
SECTION 6.3. Governmental Authorization. The execution and delivery by
the Borrower and each of its Subsidiaries of this Agreement, the Notes and each
of the other Loan Documents to which it is a party did not and will not, and
the consummation by the Obligors of the transactions contemplated hereby and
thereby will not, require any action by or in respect of, or filing with, any
governmental body, agency or governmental official except (i) the actions and
filings described in Item 6.3 of the Disclosure Schedule or Section 6.2, (ii)
those of which have been taken or obtained and are in full force and effect,
and (iii) other actions and filings which, if not taken or made, will not
affect in any material respect the validity or enforceability of this
Agreement, the Notes or any other Loan Documents or the perfection or priority
of the Lien created under the Collateral Documents.
SECTION 6.4. Contravention. The execution and delivery by the Borrower
and each of its Subsidiaries of this Agreement, the Notes or any other Loan
Documents to which it is a party did not and will not and the consummation of
the transactions contemplated hereby and thereby will not, contravene or
constitute a default under or violation of any provision of applicable law or
regulation, the Organic Documents or any material agreement, judgment,
injunction, order, decree or other instrument binding upon it or any of its
assets, or result in the creation or imposition of any Lien on any asset of the
Borrower or any of its Subsidiaries (other than the Liens created by the Loan
Documents and Permitted Liens).
SECTION 6.5. Financial Information, etc.
(a) All financial statements delivered pursuant to Section
5.1.8, fairly present, in conformity with GAAP, the consolidated
financial position of the Borrower and its Subsidiaries as of the
dates thereof and their consolidated results of operations, changes in
stockholders' equity and cash flows for the period's covered thereby.
(b) On the Closing Date, the Borrower and its Subsidiaries
will not have any liabilities, contingent or otherwise, including
liabilities for taxes, unusual or forward or long-term commitments or
unrealized or anticipated losses from any unfavorable commitments,
except (i) as referred to or reflected or provided for in the audited
consolidated balance sheet for the Fiscal Year ended December 31, 1997
or the notes thereto or (ii) as could not reasonably be expected to
have a Material Adverse Effect.
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(c) Except as disclosed in any Form 10-Q, Form 10-K or Form
8-K filed with the SEC on or prior to February 13, 1998, no
development has occurred since December 31, 1997 that has resulted, or
could reasonably be expected to result, in a Material Adverse Effect.
SECTION 6.6. Litigation. There is no action, suit or proceeding
pending or, to the knowledge of the Borrower, threatened against the Borrower
or any of its Subsidiaries before any court or arbitrator or any governmental
body, agency or official (i) for which there is a reasonable possibility of an
adverse decision that would have a Material Adverse Effect, except as disclosed
in any filing of the Borrower on Form 10-Q, Form 10-K or Form 8-K with the SEC
on or prior to February 13, 1998, or (ii) which challenges the validity of this
Agreement, the Notes, any other Loan Document or any Senior Note Document.
SECTION 6.7. Taxes. The Borrower's federal tax identification number
is 58-1651222. All income tax returns and all other material tax returns which
are required to be filed by or on behalf of the Borrower and its Subsidiaries
have been filed, except where the failure to file any of the same would not
have a Material Adverse Effect. All taxes shown as due on such returns have
been paid or adequate reserves have been established on the books of the
Borrower, except to the extent that (i) the Borrower's failure to pay any such
taxes would not have a Material Adverse Effect or (ii) any such taxes as are
being contested in good faith and for which adequate reserves are maintained on
the books of the Borrower. The charges, accruals and reserves on the books of
the Borrower and its Consolidated Subsidiaries in respect of taxes or other
governmental charges have been established in accordance with GAAP.
SECTION 6.8. Subsidiaries. Item 6.8 of the Disclosure Schedule sets
forth a complete list of all of the Borrower's direct or indirect Subsidiaries
as of the date hereof and the federal tax identification number, if any, for
each such Subsidiary. Each Subsidiary listed on such Item 6.8 with an asterisk
appearing after its name does not own any material amount of assets.
SECTION 6.9. Not a Regulated Entity. The Borrower is not an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended, nor is the Borrower a "holding company" within the meaning of the
Public Utility Holding Company Act of 1935, as amended.
SECTION 6.10. Full Disclosure. The information (other than any
projections) heretofore furnished by the Borrower to the Arranger for purposes
of or in connection with this Agreement, the Notes or any other Loan Documents
or any transaction contemplated herein or therein does not, and all such
information hereafter furnished by the Borrower to any Agent or Lender will not
(in each case taken together and on the date as of which such information is
furnished), contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements contained therein, in
the light of the circumstances under which they are made, not misleading. All
projections heretofore furnished by the Borrower to the Syndication Agent for
purposes of or in connection with this Agreement, the Notes or any other Loan
Documents or any transaction contemplated hereby or thereby have been, and all
projections hereafter furnished by the Borrower to any Agent or Lender will be,
prepared in good faith and based upon reasonable assumptions believed to be
reasonable at the time such projections were prepared. The Borrower has
disclosed to the Arranger any and all facts which materially and adversely
affect or may affect (to the extent the Borrower can now reasonably foresee),
the business, operations or financial condition of the Borrower and its
Subsidiaries, taken as a whole, or the ability of the Borrower or any of its
subsidiaries to perform its obligations under this Agreement, the Notes or any
other Loan Documents or to complete the transactions contemplated hereby or
thereby.
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SECTION 6.11. Permits. Except to the extent any of the following would
not result in a Material Adverse Effect, (i) the Borrower and its Subsidiaries
have all Permits as are necessary for the conduct of their respective
businesses as it has been carried on, (ii) all such Permits are in full force
and effect, and each of the Borrower and its Subsidiaries has fulfilled and
performed all material obligations with respect to such Permits, (iii) no event
has occurred which allows, or after notice or lapse of time would allow,
revocation or termination by the issuer thereof or which results in any other
impairment of the rights of the holder of any such Permit, and (iv) each of the
Borrower and its Subsidiaries has no reason to believe that any governmental
body or agency is considering limiting, suspending or revoking any such Permit.
SECTION 6.12. Real Property Interests. Other than the ownership
interests in real property disclosed on Item 6.12 of the Disclosure Schedule,
neither the Borrower nor any Subsidiary has any ownership interest in any real
property on and as of the date hereof.
SECTION 6.13. Compliance with ERISA. Except to the extent the same
would not individually or in the aggregate have a Material Adverse Effect, each
member of the ERISA Group has fulfilled its obligations under the minimum
funding standards of ERISA and the Internal Revenue Code with respect to each
Plan and is in compliance in all material respects with the presently
applicable provisions of ERISA and the Internal Revenue Code with respect to
each Plan. No member of the ERISA Group has (i) sought a waiver of the minimum
funding standard under Section 412 of the Internal Revenue Code in respect of
any Plan, (ii) failed to make any contribution or payment to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement, or made any
amendment to any Plan or Benefit Arrangement, which has resulted or could
result in the imposition of a Lien or the posting of a bond or other security
under ERISA or the Internal Revenue Code or (iii) incurred any liability under
Title IV of ERISA other than a liability to the PBGC for premiums under Section
4007 of ERISA except, in each case, as would not individually or in the
aggregate have a Material Adverse Effect.
SECTION 6.14. Ownership of Properties. Except for Permitted Liens, the
Borrower and each of its Subsidiaries owns (i) in the case of owned real
property, good and marketable fee title to, and (ii) in the case of owned
personal property, good and valid title to, or, in the case of leased real or
personal property, valid and enforceable leasehold interests (as the case may
be) in, all of its properties and assets, real and personal, tangible and
intangible, of any nature whatsoever, free and clear in each case of all Liens
or claims, except where the failure to so own such title or have such leasehold
interest would not individually or in the aggregate have a Material Adverse
Effect.
SECTION 6.15. Environmental Warranties. Except as set forth in Item
6.15 of the Disclosure Schedule and except where the failure of any of the
following to be true individually or in the aggregate would not have a Material
Adverse Effect:
(a) all facilities and property (including underlying
groundwater) owned or leased by the Borrower or any of its
Subsidiaries have been, and continue to be, in material compliance
with all Environmental Laws except for noncompliances which have been
fully resolved with the relevant Governmental Authorities and which
have resulted in a return to compliance;
(b) there have been no unresolved past, and there are no
pending or, to the knowledge of any Responsible Officer of the
Borrower, threatened claims, complaints, notices or requests for
information received by the Borrower or any of its Subsidiaries with
respect to any alleged violation of any Environmental Law, or any
complaints, notices or, to the knowledge of any Responsible
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Officer of the Borrower, inquiries to the Borrower or any of its
Subsidiaries regarding potential liability under any Environmental
Law;
(c) there have been no Releases of Hazardous Materials at, on
or under any property now or, to the knowledge of the Borrower,
previously owned or leased by the Borrower or any of its Subsidiaries;
(d) the Borrower and its Subsidiaries have been issued and
are in compliance with all permits, certificates, approvals, licenses
and other authorizations required by any applicable Environmental Law;
(e) no property now or, to the knowledge of the Borrower,
previously owned or leased by the Borrower or any of its Subsidiaries
is listed or, to the knowledge of any Responsible Officer of the
Borrower, proposed for listing (with respect to owned property only)
on the National Priorities List pursuant to CERCLA, on the CERCLIS or
on any similar state list of sites requiring investigation or
clean-up;
(f) there are no underground storage tanks, active or
abandoned, including petroleum storage tanks, on or under any property
now or previously owned or leased by the Borrower or any of its
Subsidiaries that, singly or in the aggregate, have, or reasonably be
expected to have, a Material Adverse Effect;
(g) neither the Borrower nor any Subsidiary of the Borrower
has directly transported or directly arranged for the transportation
of any Hazardous Material to any location which is listed or, to the
knowledge of any Responsible Officer of the Borrower, proposed for
listing on the National Priorities List pursuant to CERCLA, on the
CERCLIS or on any similar state list or which is the subject of
federal, state or local enforcement actions or, to the knowledge of
any Responsible Officer of the Borrower, other investigations which
may lead to material claims against the Borrower or such Subsidiary
thereof for any remedial work, damage to natural resources or personal
injury, including claims under CERCLA;
(h) there are no polychlorinated biphenyls or friable
asbestos present at any property now or previously owned or leased by
the Borrower or any Subsidiary of the Borrower that, singly or in the
aggregate, have, or could reasonably be expected to have, a Material
Adverse Effect;
(i) no conditions exist at, on or under any property now or,
to the knowledge of the Borrower, previously owned or leased by the
Borrower which, with the giving of notice, would give rise to material
liability under any Environmental Law; and
(j) neither the Borrower nor any of its Subsidiaries owns or
operates any medical waste treatment or incineration facility
regulated under Environmental Laws or has arranged for the treatment
or disposal of any Hazardous Material from a medical facility at an
offsite treatment or disposal facility.
SECTION 6.16. Intellectual Property. The Borrower owns and possesses
or licenses (as the case may be) all such patents, patent rights, trademarks,
trademark rights, trade names, trade name rights, service marks, service mark
rights and copyrights necessary for the conduct of the business of the Borrower
as now
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conducted without any infringement upon rights of other Persons, in each case
except as, individually or in the aggregate, could not reasonably be expected
to result in a Material Adverse Effect. To the extent required pursuant to the
Security Agreement, valid, binding and perfected Liens have been created in
favor of the Administrative Agent for the benefit of the Secured Parties in all
material patents and patents rights, if any, owned by the Borrower and the
Guarantors, which Liens shall, except for Permitted Liens, be first priority
Liens.
SECTION 6.17. Regulations G, U and X. Neither the Borrower nor any of
its Subsidiaries are engaged in the business of extending credit for the
purpose of purchasing or carrying margin stock, and no proceeds of any Credit
Extensions will be used to purchase or carry margin stock or otherwise for a
purpose which violates, or would be inconsistent with, F.R.S. Board Regulation
G, U or X. Terms for which meanings are provided in F.R.S. Board Regulation G,
U or X or any regulations substituted therefor, as from time to time in effect,
are used in this Section with such meanings.
ARTICLE VII
COVENANTS
SECTION 7.1. Affirmative Covenants. The Borrower agrees with each
Lender, each Issuer and the Administrative Agent that until all Commitments
have expired or terminated, all then accrued or due and payable monetary
Obligations have been paid and performed in full and all Letters of Credit have
expired or terminated (or the Issuer shall have received cash (in a cash
collateral account on terms reasonably satisfactory to the Issuer) in the
amount of all Letter of Credit Outstandings), the Borrower will, and will cause
its Subsidiaries to, perform or cause to be performed the obligations set forth
below.
SECTION 7.1.1. Financial Information, Reports, Notices, etc. The
Borrower will furnish or cause to be furnished to each Administrative Agent
(with sufficient copies for each Lender) copies of the following financial
statements, reports, notices and information:
(a) as soon as available and in any event within 45 days
after the end of each of the first three Fiscal Quarters of each
Fiscal Year, an unaudited consolidated balance sheet of the Borrower
and its Subsidiaries as of the end of such Fiscal Quarter and the
related unaudited consolidated statements of income and cash flows and
stockholders' equity (deficit) of the Borrower and its Subsidiaries
for such Fiscal Quarter and for the period commencing at the end of
the previous Fiscal Year and ending with the end of such Fiscal
Quarter, and including (in each case), in comparative form, the
figures for the corresponding Fiscal Quarter in, and year to date
portion of, the immediately preceding Fiscal Year, certified (subject
to footnote presentation and normal year-end adjustments, and
excepting changes concurred in by the Borrower's independent public
accountants) as to fairness of presentation, GAAP and consistency by
the chief executive, financial or accounting Authorized Officer of the
Borrower;
(b) as soon as available and in any event within 90 days
after the end of each Fiscal Year, a copy of the consolidated balance
sheet of the Borrower and its Subsidiaries as of the end of such
Fiscal Year, and the related consolidated statements of income and
cash flows and stockholders' equity (deficit) for such Fiscal Year,
setting forth in comparative form the figures for the immediately
preceding Fiscal Year, all reported on without material qualification
by Price Waterhouse LLP, any
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other "big six" accounting firm or any other independent public
accountants that is reasonably acceptable to the Administrative Agent,
which report shall be accompanied by a confirmation of the calculation
of the financial covenants set forth in Section 7.2.4 provided by the
Borrower pursuant to clause (c); provided that such confirmation shall
be limited to calculations which can reasonably be derived through the
use of the financial statements referred to in this clause (b);
(c) (i) concurrently with the delivery of the financial
information pursuant to clause (a) and clause (b), a Compliance
Certificate, executed by the chief executive, financial or accounting
Authorized Officer of the Borrower, showing compliance with the
financial covenants set forth in Section 7.2.4 and stating, to the
knowledge of the Responsible Officers of the Borrower, that no Default
has occurred and is continuing (or, if a Default has occurred,
specifying the details of such Default and the action that the
Borrower has taken or proposes to take with respect thereto) and (ii)
45 days after the end of the fourth Fiscal Quarter of each Fiscal
Year, a Preliminary Compliance Certificate, executed by the chief
executive, financial or accounting Authorized Officer of the Borrower,
showing the Borrower's compliance or noncompliance with the financial
covenants set forth in Section 7.2.4;
(d) as soon as possible and in any event within five Business
Days after any officer of the Borrower obtains knowledge of the
occurrence of a Default, a statement of the chief executive, financial
or accounting Authorized Officer of the Borrower setting forth details
of such Default and the action which the Borrower has taken and
proposes to take with respect thereto;
(e) as soon as possible and in any event within five Business
Days after any officer of the Borrower or any of its Subsidiaries
obtains knowledge of (i) the occurrence of any adverse development
which could reasonably be expected to have a Material Adverse Effect
with respect to any litigation, action or proceeding described in any
filing of the Borrower on Form 10-K, Form 10-Q or Form 8-K filed with
the SEC on or prior to February 13, 1998 or (ii) the commencement of
any litigation, action or proceeding is of the type and materiality
described in Section 6.6, notice thereof and, to the extent the
Administrative Agent requests, copies of all non- privileged
documentation relating thereto;
(f) promptly after the sending or filing thereof, copies of
all reports, notices, proxy statements, prospectuses and registration
statements which the Borrower or any of its Subsidiaries files with
the SEC or any national securities exchange;
(g) if and when any member of the ERISA Group (i) gives or is
required to give notice to the PBGC of any "reportable event" (as
defined in Section 4043 of ERISA) with respect to any Plan which might
constitute grounds for a termination of such Plan under Title IV of
ERISA, or knows that the plan administrator of any Plan has given or
is required to give notice of any such reportable event, a copy of the
notice of such reportable event given or required to be given to the
PBGC; (ii) receives notice of complete or partial withdrawal liability
under Title IV of ERISA or notice that any Multiemployer Plan is in
reorganization, is insolvent or has been terminated, a copy of such
notice; (iii) receives notice from the PBGC under Title IV of ERISA of
an intent to terminate, impose liability (other than for premiums
under Section 4007 of ERISA) in respect of, or appoint a trustee to
administer any Plan, a copy of such notice; (iv) applies for a waiver
of the minimum funding standard under Section 412 of the Internal
Revenue Code, a copy of such application; (v) gives notice of intent
to terminate any Plan under Section 4041(c) of ERISA, a copy of such
notice and other
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information filed with the PBGC; (vi) gives notice of withdrawal from
any Plan pursuant to Section 4063 of ERISA, a copy of such notice; or
(vii) fails to make any required payment or contribution to any Plan
or Multiemployer Plan or makes any amendment to any Plan which has
resulted or could result in the imposition of a Lien or the posting of
a bond or other security, a certificate of the Borrower's chief
financial Authorized Officer or chief accounting Authorized Officer
setting forth details as to such occurrence and the action, if any,
which the Borrower or applicable member of the ERISA Group is required
or proposes to take;
(h) promptly, and in any event no later than 30 days, after
any U.S. Subsidiary shall be formed or any Person shall become a U.S.
Subsidiary, notice thereof;
(i) promptly upon receipt thereof, copies of all "management
letters" submitted to the Borrower by the independent public
accountants referred to in clause (b) in connection with each audit
made by such accountants;
(j) within 30 days after the end of each calendar month, a
Borrowing Base Certificate that is calculated as of the last day of
such calendar month;
(k) promptly when available but in any event within 90 days
following the end of each Fiscal Year, a business plan for the
Borrower and its Subsidiaries for the next succeeding Fiscal Year,
which business plan shall be prepared in reasonable detail and shall
be presented on a Fiscal Quarter basis for each business segment of
the Borrower and shall project anticipated performance relative to the
financial covenants set forth in Section 7.2.4 hereof;
(l) as soon as available and in any event within 30 days
after the end of each calendar month ending on or prior to August 31,
1998, an unaudited consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of such calendar month and the related
unaudited consolidated statements of income and cash flows and
stockholders' equity (deficit) of the Borrower and its Subsidiaries
for such calendar month and for the period commencing at the end of
the previous Fiscal Year and ending with the end of such calendar
month, and including (in each case), in comparative form the figures
for the corresponding Calendar month in, and year to date portion of,
the immediately preceding Fiscal Year, certified (subject to footnote
presentation and normal year-end adjustments, and excepting changes
concurred in by the Borrower's independent public accountants) as to
fairness of presentation, GAAP and consistency by the chief executive,
financial or accounting Authorized Officer of the Borrower; and
(m) such other financial and other information as any Lender
through the Administrative Agent may from time to time reasonably
request (including information and reports in such detail as the
Administrative Agent may request with respect to the terms of and
information provided pursuant to the Compliance Certificate).
SECTION 7.1.2. Maintenance of Properties. The Borrower will, and will
cause each of its Subsidiaries to, maintain, preserve, protect and keep its and
their respective properties in good repair, working order and condition
(ordinary wear and tear excepted), and make necessary repairs, renewals and
replacements so that the business carried on by the Borrower and its
Subsidiaries may be properly conducted at all times, unless the Borrower
determines in good faith that the continued maintenance of such property is
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no longer economically desirable or the failure to comply with the foregoing
would not have a Material Adverse Effect.
SECTION 7.1.3. Payment of Obligations. The Borrower will pay and
discharge, and will cause each Subsidiary to pay and discharge, at or before
maturity, all their respective obligations and liabilities, including, without
limitation, tax liabilities, except where the failure to do so would not
reasonably be expected to have a Material Adverse Effect, and will maintain,
and will cause each Subsidiary to maintain, in accordance with GAAP,
appropriate reserves for the accrual of any of the same.
SECTION 7.1.4. Insurance. The Borrower shall, and shall cause each of
its Subsidiaries to maintain such insurance, to such extent and against such
risks, including fire and other risks insured against by extended coverage, as
is customary with companies in the same or similar businesses operating in the
same or similar locations, including (i) public liability insurance against
claims for personal injury or death or property damage occurring upon, in,
about in connection with the use of any properties owned, occupied or
controlled by it and (ii) business interruption insurance; and maintain such
other insurance as may be required by law.
SECTION 7.1.5. Conduct of Business and Maintenance of Existence. The
Borrower will continue, and will cause each Subsidiary to continue, to: (i)
preserve, renew and keep in full force and effect their respective corporate
existence except where the failure of any Subsidiary to do so would not
reasonably be expected to have a Material Adverse Effect, and (ii) preserve,
renew and keep in full force and effect their respective rights, privileges and
franchises necessary or desirable in the normal conduct of business, except
where the failure to do so would not reasonably be expected to have a Material
Adverse Effect and; provided, however, that nothing in this Section 7.1.5 shall
prohibit the dissolution of any Subsidiary, any permitted sale of any
Subsidiary or a merger or consolidation that is permitted under Section 7.2.10.
SECTION 7.1.6. Compliance with Laws. The Borrower will comply, and
cause each Subsidiary to comply, in all material respects with all applicable
laws, ordinances, rules, regulations, and requirements of governmental
authorities (including, without limitation, Environmental Laws and the rules
and regulations thereunder), except where compliance therewith is contested in
good faith by appropriate proceedings or where the failure to comply would not
reasonably be expected to have a Material Adverse Effect.
SECTION 7.1.7. Inspection of Property, Books and Records. The Borrower
will keep, and will cause each Subsidiary to keep, proper books of record and
account in which full, true and correct entries shall be made of all dealings
and transactions in relation to its business and activities; and upon
reasonable advance notice will permit, and will cause each Subsidiary to
permit, representatives of each Agent to visit during normal business hours and
inspect any of their respective properties, to examine and make abstracts from
any of their respective books and records and to discuss their respective
affairs, finances and accounts with their respective executive officers and,
subject to the right of the Borrower's representative to participate in any
such discussions, independent public accountants at such reasonable times and
as often as may reasonably, be desired.
SECTION 7.1.8. Subsidiaries. The Borrower shall cause, pursuant to
Section 7.1.9, each of its direct and indirect U.S. Subsidiaries to become a
Guarantor pursuant to the Subsidiary Guaranty, exclusive, however, of (i) any
Subsidiary which constitutes a Joint Venture and (ii) any Subsidiary which is
listed on Item 6.8 of the Disclosure Schedule, which is designated with an
asterisk in such Item 6.8 and which either (x) is dissolved within 30 days of
the Effective Date or (y) has revenues of $100,000 or less per Fiscal Year.
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SECTION 7.1.9. Future Subsidiaries. The Borrower shall promptly notify
the Administrative Agent pursuant to clause (i) of Section 7.1.1 upon any
Person becoming a Subsidiary, or upon an Obligor directly or indirectly
acquiring additional Capital Stock of any existing Subsidiary, and
(a) such Person shall, if it is a U.S. Subsidiary that is not
a Joint Venture, (i) execute and deliver to the Administrative Agent a
supplement to the Subsidiary Guaranty and the Security Agreement and
(ii) to the extent such U.S. Subsidiary is required to pledge stock of
a Subsidiary pursuant to clause (b) of this Section, become a party to
the Pledge Agreement, if not already a party thereto as a pledgor, in
a manner reasonably satisfactory to the Administrative Agent;
(b) the Borrower and each U.S. Subsidiary that is not a Joint
Venture shall, pursuant to the Pledge Agreement, pledge to the
Administrative Agent all of the outstanding shares of Capital Stock of
each such new Subsidiary (other than any such new Subsidiary which is
a BSG Government Solutions Entity) owned directly by the Borrower or
such U.S. Subsidiary, along with undated stock powers for such
certificates, executed in blank (or, if any such shares of Capital
Stock are uncertificated, confirmation and evidence reasonably
satisfactory to the Administrative Agent that the security interest in
such uncertificated securities has been transferred to and perfected
by the Administrative Agent, for the benefit of the Secured Parties,
in accordance with Section 8-313, Section 8-321 and Section 9-115 of
the U.C.C. or any other similar or local or foreign law which may be
applicable); and
(c) the Borrower and each U.S. Subsidiary that is not a Joint
Venture shall, pursuant to the Pledge Agreement, pledge to the
Administrative Agent for its benefit and that of the Secured Parties,
all intercompany notes evidencing Indebtedness of such new Subsidiary
in favor of the Borrower or such U.S. Subsidiary (which shall be in a
form acceptable to the Administrative Agent);
together, in each case, to the extent requested by the Administrative Agent,
with such opinions of legal counsel for the Borrower (which shall be from
counsel reasonably satisfactory to the Administrative Agent) relating thereto,
which legal opinions shall be in form and substance reasonably satisfactory to
the Administrative Agent; provided that such opinion shall only be required in
respect of Subsidiaries having assets or revenues in excess of $5,000,000 at
the time of compliance with this Section.
SECTION 7.1.10. Use of Proceeds. The Borrower will use and apply the
proceeds of the Credit Extensions as follows:
(a) to repay the Bridge Notes in full and all other
Indebtedness (if any) identified in Item 7.2.2(b) of the Disclosure
Schedule;
(b) for ongoing working capital and general corporate
purposes of the Borrower and the Guarantors; and
(c) to pay fees and expenses associated with the Transaction.
SECTION 7.2. Negative Covenants. The Borrower covenants and agrees
with each Lender, each Issuer and the Administrative Agent that until all
Commitments have expired or terminated, all then accrued and unpaid monetary
Obligations have been paid and performed in full and all Letters of Credit have
expired or terminated (or the Issuer shall have received immediately available
funds in a collateral account on terms
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reasonably satisfactory to the Issuer, in the amount of all Letter of Credit
Outstandings), the Borrower will, and will cause its Subsidiaries to, perform
or cause to be performed the obligations set forth below.
SECTION 7.2.1. Business Activities. The Borrower will not, and will
not permit any of its Subsidiaries to, engage in any business except those
businesses activities described in the first recital and such other businesses
as are similar or related thereto.
SECTION 7.2.2. Indebtedness. The Borrower will not, and will not
permit any of its Subsidiaries to, create, incur, assume or permit to exist any
Indebtedness, other than (without duplication):
(a) Indebtedness in respect of the Credit Extensions and
other Obligations;
(b) until the date of the initial Credit Extension,
Indebtedness that is to be repaid in full as further identified in
Item 7.2.2(b) of the Disclosure Schedule;
(c) Indebtedness of the Borrower and its Subsidiaries in
respect of the Senior Notes or outstanding on the date hereof and
identified in Item 7.2.2(c) of the Disclosure Schedule;
(d) Indebtedness of the Borrower or any wholly-owned
Subsidiary of the Borrower owing to any Guarantor, or of any
Indebtedness of any Guarantor owing to the Borrower or another
Guarantor, which Indebtedness shall, in each case, be evidenced by one
or more promissory notes which have been pledged to the Administrative
Agent for the benefit of the Secured Parties;
(e) Indebtedness in respect of Capital Expenditures
(including Capital Leases) which, at the time made, is permitted
pursuant to Section 7.2.7;
(f) Cash Management Services Obligations;
(g) Indebtedness of the Borrower or any of its Subsidiaries
incurred on account of financed insurance premiums for insurance
required under Section 7.1.4 and as otherwise maintained by the
Borrower or any such Subsidiary in the ordinary course of business;
(h) Hedging Obligations in respect of Indebtedness of the
type described in clause (a) of the definition of "Indebtedness");
(i) Indebtedness of any Person that is in existence at the
time it becomes or is consolidated into or merged with a Subsidiary of
the Borrower or that is secured by any asset acquired by the Borrower
or any Subsidiary at the time of such acquisition; provided that such
Indebtedness is not incurred in contemplation of such Person becoming
a Subsidiary or such acquisition of such asset by the Borrower or any
of its Subsidiaries, as the case may be;
(j) Indebtedness incurred under Capital Leases as part of a
sale-leaseback transaction of assets disclosed in Item 7.2.15 of the
Disclosure Schedule;
(k) renewals, refinancings, refundings or extensions of any
Indebtedness permitted by clauses (b), (e), (g), (h), (i) and (m) of
this Section 7.2.2; provided, however, that no increase in the
principal amount of any such Indebtedness in excess of accrued and
unpaid interest thereon and costs
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and expenses associated therewith shall be permitted unless such
increased amount would, at the time of such renewal, refinancing,
refunding or extension, otherwise be permitted to be incurred pursuant
to this Section and, if required, is applied pursuant to Section
3.1.1;
(l) Other Indebtedness the terms and conditions of which
shall have been approved by the Required Lenders and, unless otherwise
approved by the Required Lenders, the Net Debt Proceeds resulting
therefrom are applied in accordance with clause (c) of Section 3.1.1;
(m) other Indebtedness of the Borrower and its Subsidiaries
in an aggregate amount at any time outstanding not to exceed
$5,000,000;
(n) Indebtedness of the Receivables Subsidiary which has been
borrowed from a Person other than the Borrower or any Affiliate of the
Borrower and is limited in recourse solely to the Receivables
Subsidiary and its assets; and
(o) obligations of the Borrower and its Subsidiaries in
respect of any performance, surety or appeal bond or similar
instrument (including any letter of credit issued in lieu of any such
bond) that is issued in the ordinary course of business in respect of
any obligation of the Borrower or any of its Subsidiaries which is not
otherwise prohibited by this Agreement or the other Loan Documents.
Notwithstanding the restrictions on Indebtedness contained in this Section, the
Borrower and its Subsidiaries may incur Contingent Liabilities in respect of
(i) any Indebtedness of the Borrower or any Guarantor permitted under this
Section and (ii) any contractual obligations of the Borrower or any Guarantor
incurred in the ordinary course of business, except to the extent such
contractual obligations constitute Indebtedness that would be prohibited by
this Section.
SECTION 7.2.3. Liens. The Borrower will not, and will not permit any
of its Subsidiaries to, create, incur, assume or permit to exist any Lien upon
any of its property (including Capital Stock of any Person), revenues or
assets, whether now owned or hereafter acquired, except:
(a) Liens securing payment of the Obligations or other
obligations secured pursuant to the Collateral Documents;
(b) until the date of the initial Credit Extension, Liens
securing payment of Indebtedness of the type permitted and described
in clause (b) of Section 7.2.2;
(c) Liens securing Indebtedness permitted by clause (b) of
Section 7.2.2; Liens securing Indebtedness permitted by clause (e) of
Section 7.2.2; provided, that such Lien does not extend to any
property or asset other than that acquired or leased pursuant to the
Capital Expenditure transaction pursuant to which such Indebtedness
was incurred; Liens securing Indebtedness permitted by clause (i) of
Section 7.2.2; provided that such Liens existed at the time such
Person became or was merged into or consolidated with a Subsidiary or
such asset was acquired, as the case may be (and was not created in
contemplation of this clause), and such Lien does not extend to any
property or assets other than that acquired in accordance with such
clause (i) of Section 7.2.2; Liens securing Indebtedness which renews,
refinances, refunds or extends other Indebtedness pursuant to clause
(k) of Section 7.2.2; provided that such Lien either (x) was otherwise
permitted to be created
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pursuant to this Section or (y) only extends to property or assets on
which a Lien existed, as security for such Indebtedness which was
renewed, refinanced, refunded or extended, immediately prior to such
renewal, refinancing, refunding or extension; and Liens on cash
collateral securing obligations of the type permitted pursuant to
clause (n) of Section 7.2.2.
(d) Liens for taxes, assessments or other governmental
charges or levies not yet due or which are being actively contested in
good faith by appropriate proceedings, if adequate reserves with
respect thereto are maintained on the books of the Borrower or its
Subsidiaries, as the case may be, in accordance with GAAP;
(e) Statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and other Liens imposed by law
created in the ordinary course of business for amounts not yet due or
which are being contested in good faith by appropriate proceedings, if
adequate reserves with respect thereto are maintained on the books of
the Borrower or its Subsidiaries, as the case may be, in accordance
with GAAP;
(f) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment
insurance and other types of social security benefits or obligations
or to secure the performance of tenders, statutory obligations, surety
and appeal bonds, bids, leases, government contracts, performance and
return-of-money and other similar obligations;
(g) zoning ordinances, easements, licenses, restrictions on
the use of real property and minor irregularities in title thereto
which do not materially impair the use of such property in the
operation of the business of the Borrower or any of its Subsidiaries
or the value of such property;
(h) inchoate Liens arising under ERISA to secure current
service pension liabilities as they are incurred under the provisions
of Plans from time to time;
(i) Liens identified on Item 7.2.3 of the Disclosure
(j) Liens securing Indebtedness and other obligations, in
each case permitted hereby, in an aggregate amount not to exceed
$5,000,000 at any time outstanding;
(k) Liens securing Indebtedness permitted pursuant to clause
(n) of Section 7.2.2; and
(l) judgment Liens which do not otherwise constitute an Event
of Default.
SECTION 7.2.4. Financial Covenants. The Borrower will not permit to
occur any of the events set forth below. Any term or provision hereof to the
contrary notwithstanding, compliance with the financial covenants set forth in
this Section 7.2.4 shall be determined from and after the date when the
Compliance Certificates required pursuant to clause (c) of Section 7.1.1 are
delivered in accordance with such Section following the conclusion of any
applicable measurement period set forth below.
(a) The Borrower will not permit the Leverage Ratio as of the
end of any Fiscal Quarter occurring during any period set forth below
to be greater than the ratio set forth opposite such period:
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<PAGE> 65
<TABLE>
<CAPTION>
Period Leverage Ratio
------ --------------
<S> <C>
7/1/98 - 12/31/98 4.00:1.0
1/1/99 - 3/31/99 3.75:1.0
4/1/99 - 6/30/99 3.50:1.0
7/1/99 - 9/30/99 3.25:1.0
10/1/99 - 12/31/99 3.00:1.0
1/1/00 - 6/30/00 2.75:1.0
7/1/00 - 12/31/00 2.50:1.0
Thereafter 2.25:1.0
</TABLE>
(b) The Borrower will not permit the Interest Coverage Ratio
as of the end of any Fiscal Quarter occurring during any period set
forth below to be less than the ratio set forth opposite such period:
<TABLE>
<CAPTION>
Period Interest Coverage Ratio
------ -----------------------
<S> <C>
1/1/98 - 6/30/98 2.00:1.0
7/1/98 - 12/31/98 2.25:1.0
1/1/99 - 3/31/99 2.50:1.0
4/1/99 - 6/30/99 2.75:1.0
7/1/99 - 9/30/99 3.00:1.0
10/1/99 - 12/31/99 3.25:1.0
1/1/00 - 3/31/00 3.50:1.0
4/1/00 - 6/30/00 3.75:1.0
Thereafter 4.00:1.0
</TABLE>
(c) The Borrower will not permit EBITDA, for the period of
four Fiscal Quarters ending on the last day of any Fiscal Quarter
occurring during any period set forth below (or, if less, for the
number of Fiscal Quarters ended since January 1, 1998) to be less than
the applicable amount set forth opposite such period:
<TABLE>
<CAPTION>
Period Amount
------ ------
<S> <C>
1/1/98 - 3/31/98 $10,000,000
</TABLE>
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<TABLE>
<CAPTION>
Period Amount
------ ------
<S> <C>
4/1/98 - 6/30/98 $25,000,000
7/1/98 - 9/30/98 $44,000,000
10/1/98 - 12/31/98 $62,500,000
1/1/99 - 3/31/99 $67,500,000
4/1/99 - 6/30/99 $70,000,000
7/1/99 - 9/30/99 $72,500,000
10/1/99 - 12/31/99 $75,000,000
1/1/00 - 3/31/00 $80,000,000
Thereafter $85,000,000
</TABLE>
(d) The Borrower will not permit, as of the end of any Fiscal
Quarter, Net Worth to be less than an aggregate amount equal to (i)
$465,000,000 plus (ii) 50% of cumulative positive Net Income from the
Effective Date to the end of the Fiscal Quarter most recently ended on
or prior to such date of determination less (iii) the aggregate amount
of all accelerated write-offs of good-will to the end of such Fiscal
Quarter.
SECTION 7.2.5. Investments. The Borrower will not, and will not permit
any of its Subsidiaries to, purchase, make, incur, assume or permit to exist
any Investment in any other Person, except:
(a) Investments existing on the Effective Date (x) in
Subsidiaries listed in Item 6.8 of the Disclosure Schedule or (y)
identified in Item 7.2.5(a) of the Disclosure Schedule;
(b) Cash Equivalent Investments;
(c) Investments in the form of Indebtedness permitted by
clause (d) of Section 7.2.2 and equity investments in any Guarantor
which is a wholly-owned Subsidiary of the Borrower;
(d) Investments in the form of the acquisition of stock,
obligations or securities received in settlement or satisfaction of
debt or other monetary obligations which are created in the ordinary
course of business (and not in contemplation of satisfying this
Section 7.2.5) and are owing to the Borrower or any of its
Subsidiaries;
(e) Investments in the form of (x) an endorsement of a
negotiable instrument for collection or deposit in the ordinary course
of business or (y) usual and customary trade terms extended by the
Borrower or any of its Subsidiaries to any customer in the ordinary
course of business;
(f) Investments by the Borrower or any of its Subsidiaries in
Joint Ventures, or by the Borrower or any of its Subsidiaries in
connection with direct or indirect acquisitions of businesses and
assets, which (i) would not cause a breach of Section 7.2.1, (ii) do
not exceed $10,000,000 for
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any individual Investment or $25,000,000, in the aggregate, for all
such Investments (whether or not related) made pursuant to this clause
(f) during any Fiscal Year; provided, that, for purposes of
determining compliance with this clause (f) in connection with any
acquisition pursuant to this clause (f) of the type described in
clause (f) of Section 7.2.2, each of the amounts set forth above in
this clause (ii) shall be reduced, dollar for dollar for any
transaction or Fiscal Year, as applicable, by the amount of any
permitted Indebtedness assumed pursuant to clause (i) of Section 7.2.2
in respect of any such acquisition, and (iii) if made in the
Receivables Subsidiary, do not exceed $2,000,000, inclusive of the
amount of any Investments made in the Receivables Subsidiary pursuant
to clause (j) below;
(g) Investments in the form of loans and advances made to
directors, officers and employees of the Borrower pursuant to employee
benefit, incentive or similar plans or arrangements for the purpose of
enabling any such director, officer or employee to acquire Capital
Stock of the Borrower; provided that the aggregate amount of all such
loans and advances made in cash outstanding at any time pursuant to
this clause (g) does not exceed $5,000,000;
(h) Investments received by the Borrower or any Subsidiary in
connection with any sale or other disposition of assets permitted by
Section 7.2.12;
(i) Investments constituting Capital Expenditures permitted
pursuant to Section 7.2.7; and
(j) Investments not otherwise permitted by this Section 7.2.5
in an amount not to exceed $15,000,000 in the aggregate at any time
outstanding; provided, that, (x) for purposes of determining
compliance with this clause (j), in the event of any acquisition
pursuant to this clause (j) of the type described in clause (i) of
Section 7.2.2, the amount of any permitted Indebtedness assumed in
connection with any such acquisition shall be included, dollar for
dollar, as an Investment under this clause (j) in respect of any such
acquisition, and (y) no more than $2,000,000 in the aggregate
(inclusive of the amount of all Investments pursuant to clause
(f)(iii) above) may be invested pursuant to this clause (j) in the
Receivables Subsidiary.
Notwithstanding the restrictions on Investments contained in this Section, the
Borrower and its Subsidiaries may incur Contingent Liabilities in respect of
any Indebtedness of the Borrower or any Guarantor permitted under Section
7.2.2.
SECTION 7.2.6. Restricted Payments, etc. On and at all times after the
date hereof:
(a) the Borrower will not, and will not permit any of its
Subsidiaries to, declare, pay or make any payment, dividend,
distribution or exchange (in cash, property or obligations) on or in
respect of any shares of any class of Capital Stock (now or hereafter
outstanding) of the Borrower or on any warrants, options or other
rights with respect to any shares of any class of Capital Stock (now
or hereafter outstanding) of the Borrower (other than (i) dividends or
distributions payable in its Capital Stock or warrants, options or
other rights with respect to its Capital Stock and (ii) exchanges,
splits or reclassifications of any of its Capital Stock into
additional or other shares of its Capital Stock) or apply, or permit
any of its Subsidiaries to apply, any of its funds, property or assets
(other than Capital Stock of the Borrower or any warrants, options or
other rights with respect thereto) to the purchase, redemption,
exchange, sinking fund or other retirement of, or agree or permit any
of its Subsidiaries to purchase, redeem or exchange, any shares of any
class of Capital Stock (now or
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hereafter outstanding) of the Borrower, or any warrants, options or
other rights with respect to any shares of any class of Capital Stock
(now or hereafter outstanding) of the Borrower with any funds,
property or assets (other than Capital Stock of the Borrower or any
warrants, actions or other rights with respect thereto); provided,
that the Borrower and its Subsidiaries may make payments up of to
$1,000,000 per Fiscal Year to repurchase, redeem or otherwise acquire
or retire any Capital Stock (or options or warrants for the same) of
the Borrower or any of its Subsidiaries from any director, officer or
employee or any employee plan or similar arrangement; and
(b) the Borrower will not, and will not permit any of its
Subsidiaries to, (i) make any payment or prepayment of principal of,
or make any payment of interest on, any Senior Notes on any day prior
to the date fixed for payment therefor as set forth in the Senior Note
Indenture and (y) pursuant to Sections 4.07 and 4.08 of the Senior
Note Indenture (in each case as in effect on the date hereof) or (ii)
except as permitted in clause (i) above, redeem, purchase or defease
any Senior Notes;
The foregoing prohibited acts referred to in clauses (a) and (b) above are
herein collectively referred to as "Restricted Payments".
SECTION 7.2.7. Capital Expenditures, etc. Other than as listed in Item
7.2.15 of the Disclosure Schedule or with Casualty Proceeds reinvested in the
business of the Borrower and its Subsidiaries pursuant to clause (e) of Section
3.1.1, the Borrower will not, and will not permit any Guarantor to, make or
commit to make Capital Expenditures in any Fiscal Year, except Capital
Expenditures (including Capitalized Lease Liabilities to the extent permitted
as Indebtedness pursuant to clause (e) of Section 7.2.2) which do not aggregate
in excess of the amount set forth below opposite such Fiscal Year:
<TABLE>
<CAPTION>
Fiscal Year Capital Expenditure Amount
----------- ---------------------------
<S> <C>
1998 $40,000,000
1999 $42,000,000; and
2000 $46,000,000,
</TABLE>
provided, however, that to the extent the amount of Capital Expenditures
permitted to be made in any Fiscal Year pursuant to this Section exceeds the
aggregate amount of Capital Expenditures actually made during such Fiscal Year
under this Section (other than Capital Expenditures permitted pursuant to any
amount carried forward from the prior Fiscal Year pursuant to this proviso),
such excess amount may be carried forward to (but only to) the next succeeding
Fiscal Year (any such amount to be certified by the Borrower to the Agents in
the Compliance Certificate delivered for the last Fiscal Quarter of such Fiscal
Year, and any such amount carried forward to a succeeding Fiscal Year shall be
deemed to be used prior to the Borrower and its Subsidiaries using the amount
of Capital Expenditures permitted by this Section without giving effect to such
carry-forward).
SECTION 7.2.8. Cash Settlement Payments. The Borrower will not, and
will not permit any of its Subsidiaries to, directly or indirectly make or
agree to make any cash payments to settle any actual or threatened action, suit
or proceeding constituting an actual, threatened or potential class action
securities litigation, other than (i) settlement payments that are payable in
cash but will be fully funded by one or more
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insurance carriers, without any payment (other than the deductibles and
retentions) by the Borrower or any of its Subsidiaries or (ii) in connection
with settlements disclosed in the any filing of the Borrower on Form 10-Q, Form
10-K or Form 8-K filed with the SEC on or prior to February 13, 1998.
SECTION 7.2.9. Transactions with Affiliates. The Borrower will not,
and will not permit any Subsidiary to, directly or indirectly, pay any funds to
or for the account of, make any investment (whether by acquisition of stock or
indebtedness, by loan, advance, transfer of property, guarantee or other
agreement to pay, purchase or service, directly or indirectly, any
Indebtedness, or otherwise) in, lease, sell, transfer or otherwise dispose of
any assets, tangible or intangible, to, or participate in, or effect any
transaction in connection with any joint enterprise or other joint arrangement
with, any Affiliate, except on terms to the Borrower or such Subsidiary no less
favorable in any material respect than terms that would be obtained by the
Borrower or such Subsidiary in a comparable transaction negotiated and
consummated in good faith and on an arm's-length basis from a Person that is
not an Affiliate and is under no compulsion to consummate such transaction; in
each case other than (a) any employment agreement or any employee benefit plan
or similar arrangement entered into in the ordinary course of business or (b)
transactions between or among the Borrower or any Guarantor.
SECTION 7.2.10. Consolidations and Mergers. Neither the Borrower nor
any of its Subsidiaries will consolidate or merge with or into any other
Person, except that if before and after giving effect to any such consolidation
or merger no Default shall have occurred and be continuing: (i) any Subsidiary
of the Borrower may merge or consolidate with or into the Borrower if the
Borrower is the surviving entity, (ii) any Subsidiary of the Borrower may merge
or consolidate with or into any Subsidiary, provided that if a Guarantor is a
party thereto, such Guarantor is the surviving entity or the surviving entity
becomes a Guarantor and (iii) any Subsidiary of the Borrower that is not a U.S.
Subsidiary may merge or consolidate with or into any other Subsidiary of the
Borrower that is not a U.S. Subsidiary.
SECTION 7.2.11. Stock of Subsidiaries. The Borrower will not, and will
not permit any Guarantor to, (i) issue any Capital Stock (whether for value or
otherwise) to any Person other than the Borrower or on a pro rata basis to all
shareholders or equity owners of such Guarantor or (ii) become liable in
respect of any obligation (contingent or otherwise) to purchase, redeem,
retire, acquire or make any other payment in respect of any shares of Capital
Stock of the Borrower or any Subsidiary or any option, warrant or other right
to acquire any such shares of Capital Stock if immediately after giving effect
thereto or such purchase, redemption, retirement, acquisition or payment a
Default will have occurred and be continuing.
SECTION 7.2.12. Permitted Dispositions. The Borrower will not, and
will not permit any of its Subsidiaries to, sell, lease, license or otherwise
transfer, directly or indirectly, any of its or their assets or, other than as
permitted by Section 7.2.11, issue any equity securities of any Subsidiary
which, in the case of all such transfers and issuances, would exceed $5,000,000
in the aggregate during any Fiscal Year , exclusive, however, of the following
permitted transactions: (i) sales or other transfers of assets listed in Item
7.2.12 of the Disclosure Schedule, (ii) licenses (as licensor or licensee) of
trademarks and copyrights to customers in the ordinary course of business,
(iii) leases and subleases of assets in the ordinary course of business, (iv)
sales of assets (including, without limitation, Cash Equivalents and
uneconomical, obsolete, surplus, abandoned or out-dated equipment) in the
ordinary course of business, (v) sales, leases, licenses or other transfer of
assets to the Borrower or any Guarantor, (vi) sales, leases, licenses or other
transfers of assets by a Subsidiary that is not a Guarantor to any other such
Subsidiary or to the holders of its Capital Stock on a pro rata basis, and
(vii) sales, leases, licenses or other transfers permitted as Investments
permitted pursuant to clauses (f) or (j) of Section 7.2.5 (sales, leases,
licenses and other transfers of the types
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described in clauses (ii) through (vii) hereof being, collectively, "Excluded
Dispositions"). Any term or provision hereof to the contrary notwithstanding,
at least 80% of the consideration received by the Borrower or any of its
Subsidiaries in respect of any sale, disposition or other transfer permitted
hereunder, other than any Excluded Disposition, shall be in cash.
SECTION 7.2.13. Modification of Certain Agreements. The Borrower will
not, and will not permit any of its Subsidiaries to, without the prior written
consent of the Required Lenders, directly or indirectly, make or cause to be
made any material change, modification or alteration in the terms or conditions
of any Senior Note Document or any schedules, exhibits or agreements related
thereto, in each case which would adversely affect the rights or remedies of
the Lenders, or would materially adversely affect the Borrower's or such
Subsidiary's ability to perform hereunder or under any Loan Document.
SECTION 7.2.14. Restrictive Agreements, etc. With the exception of (x)
this Agreement or any other Loan Document, (y) any agreement governing
Indebtedness permitted by clause (b) of Section 7.2.2 as in effect on the
Effective Date, and (z) any agreement renewing, extending, refunding,
refinancing, amending or otherwise modifying any agreement referred to in the
preceding clause (y) so long as such agreement is not more restrictive, taken
as a whole, in respect of the matters set forth in this Section than the
applicable agreement referred to in the preceding clause (y), the Borrower will
not, and will not permit any of its Subsidiaries to, enter into any agreement
prohibiting (i) the ability of any Obligor to amend or otherwise modify this
Agreement or any other Loan Document or (ii) the ability of any Subsidiary
(other than a Subsidiary which is a Joint Venture) to make any payments,
directly or indirectly, to the Borrower or any Guarantor, including by way of
dividends, advances, repayments of loans, reimbursements of management and
other intercompany charges, expenses and accruals or other returns on
investments.
SECTION 7.2.15. Sale and Leaseback. Except in respect of assets
disclosed in Item 7.2.15 of the Disclosure Schedule, the Borrower will not, and
will not permit any of its Subsidiaries to, directly or indirectly enter into
any agreement or arrangement providing for the sale or transfer by it of any
property (now owned or hereafter acquired) to a Person and the subsequent lease
or rental of such property or other similar property from such Person.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1. Listing of Events of Default. Each of the following
events or occurrences described in this Article shall constitute an "Event of
Default".
SECTION 8.1.1. Non-Payment of Obligations. Any Obligor shall default
in the payment or prepayment when due of (i) any principal of any Loan, or any
Reimbursement Obligation or any deposit of cash for collateral purposes
pursuant to Section 2.6.2 or Section 2.6.4, as the case may be. Any Obligor
shall default on the payment when due of any interest on any Loan, any fee
described in Article III or any other monetary Obligation (including any
Additional Compensation Amount) and such default shall continue unremedied for
a period of five Business Days after such amount was due.
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SECTION 8.1.2. Breach of Warranty. Any representation or warranty of
any Obligor made or deemed to be made in any Loan Document (including any
certificates delivered pursuant to Article V) is or shall be incorrect when
made or deemed to have been made in any material respect.
SECTION 8.1.3. Non-Performance of Certain Covenants and Obligations.
The Borrower shall default in the due performance or observance of any of its
obligations under clause (d) or (i) of Section 7.1.1, Section 7.1.9 or Section
7.2.
SECTION 8.1.4. Non-Performance of Other Covenants and Obligations. Any
Obligor shall default in the due performance and observance of any other
agreement contained herein or in any other Loan Document executed by it, and
such default shall continue unremedied for a period of 30 days after notice
thereof shall have been given to the Borrower by the Administrative Agent.
SECTION 8.1.5. Default on Other Indebtedness. A default shall occur in
the payment when due (after giving effect to any applicable grace period),
whether by acceleration or otherwise, of any Indebtedness (other than any
Obligations) of the Borrower or any of its Subsidiaries having a principal
amount, individually or in the aggregate, in excess of $5,000,000, or a default
shall occur in the performance or observance of any obligation or condition
with respect to such Indebtedness if the effect of such default is to
accelerate the maturity of any such Indebtedness or such default shall continue
unremedied for any applicable period of time sufficient to permit the holder or
holders of such Indebtedness, or any trustee or agent for such holders, to
cause or declare such Indebtedness to become due and payable or to require such
Indebtedness to be prepaid, redeemed, purchased or defeased, or require an
offer to purchase or defease such Indebtedness to be made, prior to its
expressed maturity.
SECTION 8.1.6. Judgments, etc. Any judgment or order for the payment
of money in excess of $1,000,000 (exclusive of any amounts fully covered by
insurance (less any applicable deductible) and as to which the insurer has not
disavowed or denied, in writing, its responsibility to cover such judgment or
order) shall be rendered against the Borrower or any of its Subsidiaries or any
other Obligor and such judgment shall not have been vacated or discharged or
stayed or bonded pending appeal within 60 days after the entry thereof.
SECTION 8.1.7. Pension Plans. Any of the following events shall
occur with respect to any Pension Plan which would reasonably be expected to
result in a Material Adverse Effect:
(a) the institution of any steps by the Borrower, any member
of its Controlled Group or any other Person to terminate a Pension
Plan if, as a result of such termination, the Borrower or any such
member could be required to make a contribution to such Pension Plan,
or could reasonably expect to incur a liability or obligation to such
Pension Plan, in excess of $1,000,000; or
(b) a contribution failure occurs with respect to any Pension
Plan sufficient to give rise to a Lien under section 302(f) of ERISA.
SECTION 8.1.8. Change in Control. Any Change in Control shall occur.
SECTION 8.1.9. Bankruptcy, Insolvency, etc. The Borrower or any
Guarantor shall
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(a) generally fail to pay, or admit in writing its inability
or unwillingness generally to pay, debts as they become due;
(b) apply for, consent to, or acquiesce in the appointment of
a trustee, receiver, sequestrator or other custodian for any
substantial part of the property of any thereof, or make a general
assignment for the benefit of creditors;
(c) in the absence of such application, consent or
acquiescence in, or permit or suffer to exist, the appointment of a
trustee, receiver, sequestrator or other custodian for a substantial
part of the property of any thereof, and such trustee, receiver,
sequestrator or other custodian shall not be discharged within 60
days; provided, that the Borrower hereby expressly authorizes each
Secured Party to appear in any court conducting any relevant
proceeding during such 60-day period to preserve, protect and defend
their rights under the Loan Documents;
(d) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement or other case or
proceeding under any bankruptcy or insolvency law or any dissolution,
winding up or liquidation proceeding, in respect thereof, and, if any
such case or proceeding is not commenced by the Borrower or a
Guarantor, as the case may be, such case or proceeding shall be
consented to or acquiesced in by the Borrower or such Guarantor, as
the case may be, or shall result in the entry of an order for relief
or shall remain for 60 days undismissed; provided, that the Borrower
hereby expressly authorizes each Secured Party to appear in any court
conducting any such case or proceeding during such 60-day period to
preserve, protect and defend their rights under the Loan Documents; or
(e) take any action authorizing any of the foregoing.
SECTION 8.1.10. Impairment of Security or Collateral, etc. Any
Collateral Document or other Loan Document, or any Lien granted thereunder,
shall (except in accordance with its terms), in whole or in part, terminate,
cease to be effective or cease to be the legally valid, binding and enforceable
obligation of any Obligor party thereto; any Obligor or any other party shall,
directly or indirectly, contest in any manner such effectiveness, validity,
binding nature or enforceability; or, except for Permitted Liens or as
permitted under any Loan Document, the Liens created under any Collateral
Documents shall at any time fail to constitute valid and perfected Liens on at
least 95% of the value of all of the Collateral purported to be secured
thereby, subject to no prior or equal Lien other than Permitted Liens.
SECTION 8.2. Action if Bankruptcy. If any Event of Default
described in clauses (a) through (d) of Section 8.1.9 shall occur, the
Commitments (if not theretofore terminated) shall automatically terminate and
the outstanding principal amount of all outstanding Loans and all other
Obligations (including Reimbursement Obligations) shall automatically be and
become immediately due and payable, without notice or demand and the Borrower
or any other Person shall automatically and immediately be obligated to deposit
with the Administrative Agent cash collateral in an amount equal to all Letter
of Credit Outstandings.
SECTION 8.3. Action if Other Event of Default. If any Event of
Default (other than any Event of Default described in clauses (a) through (d)
of Section 8.1.9) shall occur for any reason, whether voluntary or involuntary,
and be continuing, the Administrative Agent, upon the direction of the Required
Lenders, shall by notice to the Borrower declare all or any portion of the
outstanding principal amount of the Loans and other Obligations (including
Reimbursement Obligations) to be due and payable, require the Borrower to
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provide cash collateral to be deposited with the Administrative Agent in an
amount equal to the undrawn amount of all Letter of Credit Outstandings, and/or
the Commitments (if not theretofore terminated) to be terminated, whereupon the
full unpaid amount of such Loans and other Obligations which shall be so
declared due and payable shall be and become immediately due and payable,
without further notice, demand or presentment, and/or, as the case may be, the
Commitments shall terminate and the Borrower shall automatically and
immediately be obligated to deposit with the Administrative Agent cash
collateral in an amount equal to all Letter of Credit Outstandings.
ARTICLE IX
THE AGENTS
SECTION 9.1. Actions. Each Lender hereby appoints DLJ as its
Syndication Agent and Wachovia as its Administrative Agent under and for
purposes of this Agreement, the Notes and each other Loan Document. Each Lender
authorizes the Administrative Agent to act on behalf of such Lender under this
Agreement, the Notes and each other Loan Document and, in the absence of other
written instructions from the Required Lenders received from time to time by
the Agents (with respect to which each of the Agents agree that they will
comply, except as otherwise provided in this Section or as otherwise advised by
counsel in order to avoid contravention of applicable law), to exercise such
powers hereunder and thereunder as are specifically delegated to or required of
the Agents by the terms hereof and thereof, together with such powers as may be
reasonably incidental thereto. Each Lender hereby indemnifies (which indemnity
shall survive any termination of this Agreement) the Agents, pro rata according
to such Lender's Percentage, from and against any and all liabilities,
obligations, losses, damages, claims, costs or expenses of any kind or nature
whatsoever which may at any time be imposed on, incurred by, or asserted
against, the Agents in any way relating to or arising out of this Agreement,
the Notes and any other Loan Document, including reasonable attorneys' fees,
and as to which any Agent is not reimbursed by the Borrower; provided, however,
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, claims, costs or expenses which are
determined by a court of competent jurisdiction in a final proceeding to have
resulted from such Agent's gross negligence or wilful misconduct. The Agents
shall not be required to take any action hereunder or under any other Loan
Document, or to prosecute or defend any suit in respect of this Agreement or
any other Loan Document, unless it is indemnified hereunder to its
satisfaction. If any indemnity in favor of the Agents shall be or become, in
such Agent's determination, inadequate, such Agent may call for additional
indemnification from the Lenders and cease to do the acts indemnified against
hereunder until such additional indemnity is given.
SECTION 9.2. Funding Reliance, etc. Unless the Administrative Agent
shall have been notified by telephone, confirmed in writing, by any Lender by
3:00 p.m., Atlanta, Georgia time, on the Business Day prior to a Borrowing that
such Lender will not make available the amount which would constitute its
Percentage of such Borrowing on the date specified therefor, the Administrative
Agent may assume that such Lender has made such amount available to the
Administrative Agent and, in reliance upon such assumption, make available to
the Borrower a corresponding amount. If and to the extent that such Lender
shall not have made such amount available to the Administrative Agent, such
Lender and the Borrower severally agree to repay the Administrative Agent
forthwith on demand such corresponding amount together with interest thereon,
for each day from the date the Administrative Agent made such amount available
to the Borrower to the date such amount is repaid to the Administrative Agent,
at the interest rate applicable at the time to Loans comprising such Borrowing
(in the case of the Borrower) and (in the case of a Lender), at the Federal
Funds
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Rate (for the first two Business Days after which such amount has not been
repaid, and thereafter at the interest rate applicable to Loans comprising such
Borrowing.
SECTION 9.3. Exculpation. None of the Agents, the Swing Line Lender,
the Issuer or any of their respective directors, officers, employees or agents
shall be liable to any Lender for any action taken or omitted to be taken by it
under this Agreement or any other Loan Document, or in connection herewith or
therewith, except for its own wilful misconduct or gross negligence, nor
responsible for any recitals or warranties herein or therein, nor for the
effectiveness, enforceability, validity or due execution of this Agreement or
any other Loan Document, nor for the creation, perfection or priority of any
Liens purported to be created by any of the Loan Documents, or the validity,
genuineness, enforceability, existence, value or sufficiency of any collateral
security, nor to make any inquiry respecting the performance by the Borrower of
its obligations hereunder or under any other Loan Document. Any such inquiry
which may be made by any Agent, the Swing Line Lender or the Issuer shall not
obligate it to make any further inquiry or to take any action. The Agents, the
Swing Line Lender and the Issuer shall be entitled to rely upon advice of
counsel concerning legal matters and upon any notice, consent, certificate,
statement or writing which the Agents, the Swing Line Lender or the Issuer
believes to be genuine and to have been presented by a proper Person.
SECTION 9.4. Successor. The Syndication Agent may resign as such upon
one Business Day's notice to the Borrower and the Administrative Agent. The
Administrative Agent may (i) resign as such at any time upon at least 30 days'
prior notice to the Borrower and all Lenders or (ii) be replaced at any time
upon at least 30 days' prior notice from the Borrower to the Agents and the
Lenders. If the Administrative Agent at any time shall resign, the Required
Lenders may appoint another Lender acceptable to the Borrower as a successor
Administrative Agent which shall thereupon become the Administrative Agent
hereunder. If no successor Administrative Agent shall have been so appointed by
the Required Lenders and approved by the Borrower, and shall have accepted such
appointment, within 30 days after the retiring Administrative Agent's giving
notice of resignation, then the retiring Administrative Agent may, on behalf of
the Lenders, appoint a successor Administrative Agent (reasonably satisfactory
to the Borrower), which shall be one of the Lenders or a commercial banking
institution organized under the laws of the U.S. (or any State thereof) or a
U.S. branch or agency of a commercial banking institution, and having (x) a
combined capital and surplus of at least $250,000,000 and (y) a credit rating
of AA or better by Moody's or a comparable rating by S&P; provided, however,
that if, after expending all reasonable commercial efforts, such retiring
Administrative Agent is unable to find a commercial banking institution which
is willing to accept such appointment and which meets the qualifications set
forth in clause (y) above, such retiring Administrative Agent, shall be
permitted to appoint as its successor from all available commercial banking
institutions willing to accept such appointment such institution having the
highest credit rating of all such available and willing institutions. Any, term
or provision hereof to the contrary notwithstanding, the Borrower shall not be
permitted to replace the Administrative Agent unless it has found a successor
Administrative Agent which is willing to accept such appointment and is either
satisfactory to the Required Lenders or meets the requirements set forth in the
immediately preceding sentence. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall be entitled to receive from the retiring
Administrative Agent such documents of transfer and assignment as such
successor Administrative Agent may reasonably request, and shall thereupon
succeed to and become vested with all 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. After any
retiring Administrative Agent's resignation hereunder as the Administrative
Agent, the provisions of
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(a) this Article IX shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was the
Administrative Agent under this Agreement; and
(b) Section 10.3 and Section 10.4 shall continue to inure to
its benefit.
SECTION 9.5. Credit Extensions by each Agent. Each Agent, the Swing
Line Lender and the Issuer shall have the same rights and powers with respect
to (x) (i) in the case of the Agents and the Swing Line Lender, the Credit
Extensions made by it or any of its Affiliates and (ii) in the case of the
Issuer, the Loans made by it or any of its Affiliates, and (y) the Notes held
by such Agent, the Swing Line Lender, the Issuer or any of their respective
Affiliates as any other Lender and may exercise the same as if it were not an
Agent or the Issuer. Each Agent, the Swing Line Lender, the Issuer and each and
their respective Affiliates may accept deposits from, lend money to, and
generally engage in any kind of business with the Borrower or any Subsidiary or
Affiliate of the Borrower as if such Agent, the Swing Line Lender or Issuer
were not an Agent, the Swing Line Lender or the Issuer hereunder.
SECTION 9.6. Credit Decisions. Each Lender acknowledges that it has,
independently of each Agent, the Documentation Agent, the Arranger, the Swing
Line Lender, the Issuer and each other Lender, and based on such Lender's
review of the financial information of the Borrower, this Agreement, the other
Loan Documents (the terms and provisions of which being satisfactory to such
Lender) and such other documents, information and investigations as such Lender
has deemed appropriate, made its own credit decision to extend its Commitments.
Each Lender also acknowledges that it will, independently of each Agent, the
Documentation Agent, the Arranger, the Swing Line Lender, the Issuer and each
other Lender, and based on such other documents, information and investigations
as it shall deem appropriate at any time, continue to make its own credit
decisions as to exercising or not exercising from time to time any rights and
privileges available to it under this Agreement or any other Loan Document.
SECTION 9.7. Copies, etc. The Administrative Agent shall give prompt
notice to each Lender of each notice or request required or permitted to be
given to the Administrative Agent by the Borrower pursuant to the terms of this
Agreement (unless concurrently delivered to the Lenders by the Borrower). The
Administrative Agent will distribute to each Lender each document or instrument
received for its account and copies of all other communications received by the
Administrative Agent from the Borrower for distribution to the Lenders by the
Administrative Agent in accordance with the terms of this Agreement or any
other Loan Document.
SECTION 9.8. The Swing Line Lender, the Issuer, the Syndication Agent
and the Administrative Agent. Notwithstanding anything else to the contrary
contained in this Agreement or any other Loan Document, the Swing Line Lender,
the Issuer and the Agents, in their respective capacities as such, each in such
capacity, shall have no duties or responsibilities under this Agreement or any
other Loan Document nor any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or otherwise exist against the
Swing Line Lender, the Issuer or any Agent, as applicable, in such capacity
except as are explicitly set forth herein or in the other Loan Documents.
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ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Waivers, Amendments, etc. The provisions of this
Agreement and of each other Loan Document may from time to time be amended,
modified or waived, if such amendment, modification or waiver is in writing and
consented to by the Borrower and the Required Lenders; provided, however, that
no such amendment, modification or waiver shall:
(a) extend the Stated Maturity Date or modify this Section
10.1 without the consent of all Lenders;
(b) increase the aggregate amount of any Lender's Percentage
of any Commitment Amount, increase the aggregate amount of any Loans
required to be made by a Lender pursuant to its Commitments (except
pursuant to a waiver or amendment permitted hereby) or reduce any fees
described in Article III payable to any Lender without the consent of
such Lender;
(c) extend the Stated Maturity Date for any Lender's Loan, or
reduce the principal amount of or rate of interest on any Lender's
Loan, without the consent of such Lender (it being understood and
agreed, however, that any vote to rescind any acceleration made
pursuant to Section 8.2 and Section 8.3 of amounts owing with respect
to the Loans and other Obligations shall only require the vote of the
Required Lenders);
(d) change the definition of "Required Lenders" or any
requirement hereunder that any particular action be taken by all
Lenders without the consent of all Lenders;
(e) increase the Stated Amount of any Letter of Credit or any
Lender's Percentage in such Letter of Credit or any Letter of Credit
Outstandings in respect thereof, unless consented to by the Issuer of
such Letter of Credit;
(f) except as otherwise contemplated in the Loan Documents,
release (i) any Guarantor from its obligations under a Subsidiary
Guaranty or (ii) all or substantially all of the Collateral under the
Loan Documents, in either case without the consent of all Lenders as
expressly provided herein or therein;
(g) change any of the terms of clause (iii) of Section 2.1.4
or Section 2.3.2 without the consent of the Swing Line Lender; or
(h) affect adversely the interests, rights or obligations of
any Agent (in its capacity as such), the Swing Line Lender (in its
capacity as Swing Line Lender) or the Issuer (in its capacity as
Issuer), unless consented to by such Agent, the Swing Line Lender or
the Issuer, as the case may be.
No failure or delay on the part of any Agent, the Issuer or any Lender in
exercising any power or right under this Agreement or any other Loan Document
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power or right preclude any other or further exercise thereof or the
exercise of any other power or right. No notice to or demand on the Borrower or
any other Obligor in any case shall entitle it to any notice or demand in
similar or other circumstances. No waiver or approval by any Agent, the Issuer
or
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any Lender under this Agreement or any other Loan Document shall, except as
may be otherwise stated in such waiver or approval, be applicable to subsequent
transactions. No waiver or approval hereunder shall require any similar or
dissimilar waiver or approval thereafter to be granted hereunder.
For purposes of this Section 10.1, the Administrative Agent, in
coordination with the Syndication Agent, shall have primary responsibility,
together with the Borrower, in the negotiation, preparation, and documentation
relating to any amendment, modification or waiver of this Agreement, any other
Loan Document or any other agreement or document related hereto or thereto
contemplated pursuant to this Section.
SECTION 10.2. Notices. All notices and other communications provided
to any party hereto under this Agreement or any other Loan Document shall be in
writing or by facsimile and addressed, delivered or transmitted to such party
at its address or facsimile number set forth below its signature hereto or set
forth in the Lender Assignment Agreement or at such other address or facsimile
number as may be designated by such party in a notice to the other parties. Any
notice, if mailed and properly addressed with postage prepaid or if properly
addressed and sent by pre-paid courier service, shall be deemed given when
received; any notice, if transmitted by facsimile, shall be deemed given when
the confirmation of transmission thereof is received by the transmitter. Any
term or provision hereof to the contrary notwithstanding, for purposes of this
Agreement and each other Loan Document a "writing" shall include a facsimile.
SECTION 10.3. Payment of Costs and Expenses. The Borrower agrees to
pay on demand all expenses of each of the Agents (including the reasonable fees
and reasonable out-of-pocket expenses of counsel to the Agents and of local
counsel, if any, who may be reasonably retained by counsel to the Agents) in
connection with
(a) the syndication prior to April 30, 1998 by the
Syndication Agent of the Loans, the negotiation, preparation,
execution and delivery of this Agreement and of each other Loan
Document, including schedules and exhibits, and any amendments,
waivers, consents, supplements or other modifications to this
Agreement or any other Loan Document as may from time to time
hereafter be required, whether or not the transactions contemplated
hereby are consummated;
(b) the filing, recording, refiling or rerecording of any
Loan Document and/or any Uniform Commercial Code financing statements
relating thereto and all amendments, supplements, amendments and
restatements and other modifications to any thereof and any and all
other documents or instruments of further assurance required to be
filed or recorded or refiled or rerecorded by the terms hereof or the
terms of any Loan Document; and
(c) the preparation and review of the form of any document or
instrument relevant to this Agreement or any other Loan Document.
The Borrower further agrees to pay, and to save each Secured Party harmless
from all liability for, any stamp or other taxes which may be payable in
connection with the execution or delivery of this Agreement, the Credit
Extensions hereunder, or the issuance of the Notes, Letters of Credit or any
other Loan Documents. The Borrower also agrees to reimburse each Secured Party
upon demand for all reasonable out-of-pocket expenses (including reasonable
attorneys' fees and legal expenses) incurred by each Secured Party in
connection with (x) the negotiation of any restructuring or "work-out" with the
Borrower, whether or not consummated, of any Obligations and (y) the
enforcement of any Obligations; provided, that the Borrower
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shall only be obligated to reimburse such legal expenses of one legal firm
representing the Lenders in their capacity as Lenders and the fees and expenses
of one consulting firm engaged by (or on behalf of) the Agents, except to the
extent (in the case of the legal firm) the representation of all of the Lenders
by a single law firm would give rise to a conflict of interest for such firm
(including by way of representing the Agents in their respective capacities as
Agents).
SECTION 10.4. Indemnification. In consideration of the execution and
delivery of this Agreement by each Secured Party, the Borrower hereby
indemnifies, exonerates and holds each Secured Party and each of their
respective officers, directors, employees and agents (collectively, the
"Indemnified Parties") free and harmless from and against any and all actions,
causes of action, suits, losses, costs, liabilities and damages, and expenses
incurred in connection with any such action, cause of action or suit
(irrespective of whether any such Indemnified Party is a party to the action
for which indemnification hereunder is sought), including reasonable attorneys'
fees and disbursements, whether incurred in connection with actions between or
among the parties hereto or the parties hereto and third parties (collectively,
the "Indemnified Liabilities"), incurred by the Indemnified Parties or any of
them as a result of, or arising out of, or relating to
(a) any transaction financed or to be financed in whole or in
part, directly or indirectly, with the proceeds of any Credit
Extension;
(b) the entering into and performance of this Agreement and
any other Loan Document by any of the Indemnified Parties (including
any action brought by or on behalf of the Borrower as the result of
any determination by the Required Lenders pursuant to Article V not to
fund any Credit Extension), provided that any such action is resolved
in favor of such Indemnified Party;
(c) any investigation, litigation or proceeding related to
any acquisition or proposed acquisition by the Borrower or any of its
Subsidiaries of all or any portion of the stock or assets of any
Person, whether or not an Indemnified Party is party thereto;
(d) any investigation, litigation or proceeding related to
any environmental cleanup, audit, compliance or other matter relating
to the protection of the environment or the Release by the Borrower or
any of its Subsidiaries of any Hazardous Material;
(e) the presence on or under, or the escape, seepage,
leakage, spillage, discharge, emission, discharging or releases from,
any real property owned or operated by the Borrower or any Subsidiary
thereof of any Hazardous Material (including any losses, liabilities,
damages, injuries, costs, expenses or claims asserted or arising under
any Environmental Law), regardless of whether caused by, or within the
control of, the Borrower or such Subsidiary; or
(f) each Lender's Environmental Liability (the
indemnification herein shall survive repayment of the Notes and any
transfer of the property of the Borrower or any of its Subsidiaries by
foreclosure or by a deed in lieu of foreclosure for any Lender's
Environmental Liability, regardless of whether caused by, or within
the control of, the Borrower or such Subsidiary);
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified Party's
gross negligence, bad faith or wilful misconduct. Except to the extent of any
Secured Party's gross negligence, bad faith or wilful misconduct, the Borrower
and its successors and assigns hereby waive, release and agree not to make any
claim or bring any cost recovery action against, any
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such Secured Party under CERCLA or any state equivalent, or any similar law now
existing or hereafter enacted. It is expressly understood and agreed that to
the extent that any of such Persons is strictly liable under any Environmental
Laws, the Borrower's obligation to such Person under this indemnity shall
likewise be without regard to fault on the part of the Borrower with respect to
the violation or condition which results in liability of such Person. If and to
the extent that the foregoing undertaking may be unenforceable for any reason,
the Borrower hereby agrees to make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is permissible under
applicable law. Notwithstanding anything to the contrary contained in this
Section 10.4, the Indemnified Parties shall be collectively represented by a
single legal counsel except for any such Indemnified Party that such counsel
may not represent as a result of a conflict of interest.
SECTION 10.5. Survival. The obligations of the Borrower under Sections
4.3, 4.4, 4.5, 4.6, 10.3 and 10.4, and the obligations of the Lenders under
Sections 9.1 and 10.13, shall in each case survive any assignment from one
Lender to another (in the case of Sections 10.3, 10.4 and 10.13) and any
termination of this Agreement, the payment in full of all the Obligations and
the termination of all the Commitments. The representations and warranties made
by the Borrower and each other Obligor in this Agreement and in each other Loan
Document shall survive the execution and delivery of this Agreement and each
such other Loan Document.
SECTION 10.6. Severability. Any provision of this Agreement or any
other Loan Document which is prohibited or unenforceable in any jurisdiction
shall, as to such provision and such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions of this Agreement or such Loan Document or affecting the validity or
enforceability of such provision in any other jurisdiction.
SECTION 10.7. Headings. The various headings of this Agreement and of
each other Loan Document are inserted for convenience only and shall not affect
the meaning or interpretation of this Agreement or such other Loan Document or
any provisions hereof or thereof.
SECTION 10.8. Execution in Counterparts, Effectiveness, etc. This
Agreement may be executed by the parties hereto in several counterparts, each
of which shall be an original and all of which shall constitute together but
one and the same agreement. This Agreement shall become effective when
counterparts hereof executed on behalf of the Borrower, the Agents and each
Lender (or notice thereof satisfactory to the Administrative Agent) shall have
been received by the Administrative Agent.
SECTION 10.9. Governing Law; Entire Agreement. THIS AGREEMENT, THE
NOTES AND EACH OTHER LOAN DOCUMENT (INCLUDING PROVISIONS WITH RESPECT TO
INTEREST, LOAN CHARGES AND COMMITMENT FEES) SHALL EACH BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), EXCEPT TO THE EXTENT THAT THE
VALIDITY OR PERFECTION OF A SECURITY INTEREST OR MORTGAGE HEREUNDER, OR
REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE
LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK. This Agreement, the
Notes, the other Loan Documents and the Fee Letters constitute the entire
understanding among the parties hereto with respect to the subject matter
hereof and thereof and supersede any prior agreements, written or oral, with
respect thereto.
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SECTION 10.10. Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that:
(a) the Borrower may not assign or transfer its rights or
obligations hereunder without the prior written consent of the
Administrative Agent and all Lenders; and
(b) the rights of sale, assignment and transfer of the
Lenders are subject to Section 10.11.
SECTION 10.11. Sale and Transfer of Loans and Notes; Participations
in Loans and Notes. Each Lender may assign, or sell participations in, its
Loans, Letters of Credit and Commitments to one or more other Persons in
accordance with this Section 10.11.
SECTION 10.11.1. Assignments.
(a) With the consent of the Borrower, the Agents and, in the
case of any assignment of participations in Letters of Credit or
Revolving Loan Commitments, the Issuer (provided, that (i) such
consents shall not be unreasonably withheld or delayed and (ii) no
such consents shall be required in the case of any Lender or Issuer
during the continuation of an Event of Default) any Lender may at any
time assign and delegate to one or more commercial banks or other
financial institutions, and
(b) upon notice to the Borrower, the Agents and (in the case
of any assignment of participations in Letters of Credit or Revolving
Loan Commitments) the Issuer, any Lender may assign and delegate to
any of its Affiliates or Related Funds or to any other Lender (but
only so long as the same does not result in any increased obligation
of the Borrower pursuant to Section 4.3, 4.4, 4.5, 4.6 or 10.3),
all or any fraction of such Lender's total Loans, participations in Letters of
Credit and Letter of Credit Outstandings with respect thereto and Commitments
in a minimum aggregate amount of $5,000,000 (or, if less, the entire remaining
amount of such Lender's Loans, Letter of Credit Outstandings and Commitments);
or such lesser amount as the Borrower and the Agents may agree; provided,
however, the assigning Lender must assign a pro rata portion of each of its
Loans, Commitments and interest in Letters of Credit Outstandings. Each Obligor
and the Agents shall be entitled to continue to deal solely and directly with a
Lender in connection with the interests so assigned and delegated to an
Assignee Lender until
(c) notice of such assignment and delegation, together with (i)
payment instructions, (ii) the Internal Revenue Service Forms or other
statements contemplated or required to be delivered pursuant to Section 4.6, if
applicable, and (iii) addresses and related information with respect to such
Assignee Lender, shall have been delivered to the Borrower and the Agents by
such assignor Lender and such Assignee Lender;
(d) such Assignee Lender shall have executed and delivered to the
Borrower and the Agents a Lender Assignment Agreement, accepted by the Agents;
and
(e) the processing fees described below shall have been paid.
From and after the date that the Agents accept such Lender Assignment
Agreement, (x) the Assignee Lender thereunder shall be deemed automatically to
have become a party hereto and to the extent that rights and
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obligations hereunder have been assigned and delegated to such Assignee Lender
in connection with such Lender Assignment Agreement, shall have the rights and
obligations of a Lender hereunder and under the other Loan Documents, and (y)
the assignor Lender, to the extent that rights and obligations hereunder have
been assigned and delegated by it in connection with such Lender Assignment
Agreement, shall be released from its obligations hereunder and under the other
Loan Documents. Promptly after its receipt of notice that the Administrative
Agent has received and accepted an executed Lender Assignment Agreement and
request from the Assignee Lender for a Note, but subject to clause (c), the
Borrower shall execute and deliver to the Administrative Agent (for delivery to
the relevant Assignee Lender) a new Note evidencing such Assignee Lender's
assigned Loans and Commitments and, if the assignor Lender has retained Loans
and Commitments hereunder (and if requested by such Lender), a replacement Note
in the principal amount of the Loans and Commitments retained by the assignor
Lender hereunder (such Note to be in exchange for, but not in payment of, the
Note then held by such assignor Lender). Each such Note shall be dated the date
of the predecessor Note. The assignor Lender shall mark each predecessor Note
"exchanged" and deliver each of them to the Borrower. Accrued interest on that
part of each predecessor Note evidenced by a new Note, and accrued fees, shall
be paid to the assignor or Assignee Lender as provided in the Lender Assignment
Agreement. Accrued interest on that part of each predecessor Note evidenced by
a replacement Note shall be paid to the assignor Lender. Accrued interest and
accrued fees shall be paid at the same time or times provided in the
predecessor Note and in this Agreement. Such assignor Lender or such Assignee
Lender (unless the Assignor Lender or Assignee Lender is DLJ or any of its
Affiliates) must also pay a processing fee in the amount of $3,500 to the
Administrative Agent upon delivery of any Lender Assignment Agreement. Any
attempted assignment and delegation not made in accordance with this Section
10.11.1 shall be null and void. Notwithstanding anything to the contrary set
forth above, any Lender may (without requesting the consent of the Borrower or
the Administrative Agent) pledge its rights (but not its obligations to make
Loans or participate in Letters of Credit or Letter of Credit Outstandings)
under this Agreement and/or its Loans and/or its Notes hereunder (i) to a
Federal Reserve Bank in support of borrowings made by such Lender from such
Federal Reserve Bank, or (ii) in the case of a Lender that is an investment
fund, to the trustee under the indenture to which such fund is a party in
support of its obligations to such trustee, in either case without notice to or
consent of the Borrower or the Agents; provided, however, that (A) such Lender
shall remain a "Lender" under this Agreement and shall continue to be bound by
the terms and conditions set forth in this Agreement and the other Loan
Documents, and (B) any assignment by such trustee shall be subject to the
provisions of clause (a) of this Section 10.11.1.
(f) In the event that S&P or Moody's, shall, after the date that any
Person becomes a Lender, downgrade the long-term certificate of deposit ratings
of such Lender, and the resulting ratings shall be below BBB- or Baa3,
respectively, or the equivalent, then the Borrower and each Issuer shall each
have the right, but not the obligation, upon notice to such Lender and the
Administrative Agent, to replace such Lender with a financial institution (a
"Replacement Lender") acceptable to the Borrower and the Administrative Agent
(such consents not to be unreasonably withheld or delayed; provided, that no
such consent shall be required if the Replacement Lender is an existing Lender
(but only so long as the same does not result in any increased obligation of
the Borrower pursuant to Section 4.3, 4.4, 4.5, 4.6 or 10.3)) and meeting the
requirements set forth in clause (a) above, and upon any such downgrading of
any Lender's long-term certificate of deposit rating, each such Lender hereby
agrees to transfer and assign (in accordance with Section 10.11.1) all of its
Commitments, Loans, Notes and other rights and obligations under this Agreement
and all other Loan Documents (including Reimbursement Obligations) to such
Replacement Lender; provided, however, that (i) such assignment shall be
without recourse, representation or warranty (other than that such Lender owns
the Commitments, Loans and Notes being assigned, free and clear of any Liens)
and (ii) the purchase price paid by the Replacement Lender shall be in the
amount of such Lender's Loans and its Percentage of
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outstanding Reimbursement Obligations, together with all accrued and unpaid
interest and fees in respect thereof, plus all other amounts (other than the
amounts (if any) demanded and unreimbursed under Sections 4.2, 4.3, 4.5 and
4.6, which shall be paid by the Borrower), owing to such Lender hereunder. Upon
any such termination or assignment, such Lender shall cease to be a party
hereto but shall continue to be entitled to the benefits of any provisions of
this Agreement which by their terms survive the termination of this Agreement.
(g) On or promptly after the effective date of an assignment described
in clause (f), the Borrower shall issue a replacement Note or Notes, as the
case may be, to such Replacement Lender and such institution shall become a
"Lender" for all purposes under this Agreement and the other Loan Documents.
SECTION 10.11.2. Participations. Any Lender may sell to one or more
commercial banks or other Persons (each of such commercial banks and other
Persons being herein called a "Participant") participating interests in any of
the Loans, Commitments, participations in Letters of Credit and Letter of
Credit Outstandings or other interests of such Lender hereunder; provided,
however, that
(a) no participation contemplated in this Section 10.11 shall
relieve such Lender from its Commitments or its other obligations
hereunder or under any other Loan Document;
(b) such Lender shall remain solely responsible for the
performance of its Commitments and such other obligations;
(c) the Borrower and each other Obligor, the Agents and the
Issuer shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this
Agreement and each of the other Loan Documents;
(d) no Participant, unless such Participant is an Affiliate
or Related Fund of such Lender or is itself a Lender, shall be
entitled to require such Lender to take or refrain from taking any
action hereunder or under any other Loan Document, except that such
Lender may agree with any Participant that such Lender will not,
without such Participant's consent, take any actions of the type
described in clause (a), (b), or, to the extent requiring the consent
of each Lender, clause (c) of Section 10.1; and
(e) the Borrower shall not be required to pay any amount
under this Agreement that is greater than the amount which it would
have been required to pay had no participating interest been sold.
The Borrower acknowledges and agrees that, subject to clause (e) above, each
Participant, for purposes of Sections 4.3, 4.4, 4.5, 4.6, 4.8, 4.9, 10.3 and
10.4, shall be considered a Lender. Each Participant shall only be indemnified
for increased costs pursuant to Section 4.3, 4.5 or 4.6, and shall only be
indemnified pursuant to Sections 10.3 and 10.4, if and to the extent that the
Lender which sold such participating interest to such Participant concurrently
is entitled to make, and does make, a claim on the Borrower for such increased
costs or other amounts, as the case may be. Any Lender that sells a
participating interest in any Loan, Commitment or other interest to a
Participant under this Section 10.11.2 shall indemnify and hold harmless the
Borrower and the Agents from and against any taxes, penalties, interest or
other costs or losses (including reasonable attorneys' fees and expenses)
incurred or payable by the Borrower or any Agent as a result of the failure of
the Borrower or such Agent to comply with its obligations to deduct or withhold
any Taxes from any payments made pursuant to this Agreement to such Lender or
such Agent, as the case may be, which Taxes
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would not have been incurred or payable if such Participant had been a Non-U.S.
Lender that was entitled to deliver to the Borrower, such Agent or such Lender,
and did in fact so deliver, a duly completed and valid Form 1001 or 4224 (or
applicable successor form) entitling such Participant to receive payments under
this Agreement without deduction or withholding of any United States federal
taxes.
SECTION 10.12. Other Transactions. Nothing contained herein shall
preclude the Administrative Agent, the Issuer or any other Lender from engaging
in any transaction, in addition to those contemplated by this Agreement or any
other Loan Document, with the Borrower or any of its Affiliates in which the
Borrower or such Affiliate is not restricted hereby from engaging with any
other Person.
SECTION 10.13. Confidentiality. The Lenders shall hold all non-public
information (which shall include all financial information as well as any other
information which has been identified as such by the Borrower) obtained
pursuant to the requirements of, or otherwise in connection with, this
Agreement or any other Loan Document in accordance with their customary
procedures for handling confidential information of this nature and in
accordance with safe and sound banking practices and in any event may make
disclosure to any of their examiners, and, on a confidential basis, their
Affiliates, outside auditors, counsel and other professional advisors in
connection with this Agreement or as reasonably required by any bona fide
transferee, participant or assignee or as required or requested by any
governmental agency or representative thereof or pursuant to legal process;
provided, however, that
(a) unless specifically prohibited by applicable law or court
order, each Lender shall notify the Borrower of any request by any
governmental agency or representative thereof (other than any such
request in connection with an examination of the financial condition
of such Lender by such governmental agency) for disclosure of any such
non-public information prior to disclosure of such information;
(b) prior to any such disclosure pursuant to this Section
10.13, each Lender shall require any such bona fide transferee,
participant and assignee receiving a disclosure of non-public
information to agree in writing for the benefit of the Borrower (i) to
be bound by this Section 10.13; and (ii) to require such Person to
require any other Person to whom such Person discloses such non-public
information to be similarly bound by this Section 10.13; and
(c) except as may be required by an order of a court of
competent jurisdiction and to the extent set forth therein, no Lender
shall be obligated or required to return any materials furnished by
the Borrower or any Subsidiary.
SECTION 10.14. Forum Selection and Consent to Jurisdiction. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE AGENTS, THE
LENDERS, THE ISSUER OR THE BORROWER IN CONNECTION HEREWITH OR THEREWITH MAY BE
BROUGHT AND MAINTAINED IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER,
THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY
BE BROUGHT, AT THE AGENTS' OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE BORROWER IRREVOCABLY
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<PAGE> 84
CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY
PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK AT THE ADDRESS FOR
NOTICES SPECIFIED IN SECTION 10.2. THE BORROWER HEREBY EXPRESSLY AND
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION
BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH
LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT THE
BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY
COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT
PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, THE BORROWER HEREBY IRREVOCABLY WAIVES TO THE FULLEST
EXTENT PERMITTED BY LAW SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS.
SECTION 10.15. Waiver of Jury Trial. THE AGENTS, EACH LENDER, THE
ISSUER AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE
TO THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHTS THEY MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF
THE AGENTS, THE LENDER, THE ISSUER OR THE BORROWER IN CONNECTION HEREWITH OR
THEREWITH. EACH SUCH PERSON ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL
AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF
EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A
MATERIAL INDUCEMENT FOR THE AGENTS, EACH LENDER AND THE ISSUER ENTERING INTO
THIS AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
SECTION 10.16. Termination. This Agreement and the other Loan
Documents and all of the covenants, agreements and other obligations of the
Borrower and the other Obligors hereunder and thereunder (other than such
Obligations set forth in Section 10.4 and all other such Obligations which by
their terms expressly survive any such termination) shall terminate when all
the Commitments have expired or terminated, all then accrued or due and payable
monetary Obligations have been paid in full and all Letters of Credit have
expired or terminated (or the Issuer shall have received cash (in a cash
collateral account on terms reasonably satisfactory to the Issuer) in the
amount of all Letter of Credit Outstandings).
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<PAGE> 85
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized as of the
day and year first above written.
MEDAPHIS CORPORATION
By:
-----------------------------------------
Title:
Address: 2700 Cumberland Parkway, Suite 300
Atlanta, Georgia 30339
Facsimile No.: (770) 444-4503
Attention: Chief Financial Officer, with a
copy to the General Counsel (Facsimile No.:
(770) 444-4502)
DLJ CAPITAL FUNDING, INC,
as the Syndication Agent and as a Lender
By:
-----------------------------------------
Title:
Address: 277 Park Avenue
New York, NY 10172
Facsimile No.: (212) 892-7542
Attention: James Paradise
<PAGE> 86
WACHOVIA BANK, N.A.,
as the Administrative Agent and as a Lender
By:
-----------------------------------------
Title:
Address: 191 Peachtree Street, N.E.
Atlanta, Georgia 30303
Facsimile No.: (404) 332-6920
Attention: Structured Finance -- Cash Flow
-80-
<PAGE> 87
EXHIBIT A-1
REVOLVING NOTE
$25,000,000.00 February 20, 1998
FOR VALUE RECEIVED, the undersigned, MEDAPHIS CORPORATION, a Delaware
corporation (the "Borrower"), promises to pay to the order of WACHOVIA BANK,
N.A., (the "Lender") on the Stated Maturity Date (as defined in the Credit
Agreement referred to below) the principal sum of TWENTY-FIVE MILLION DOLLARS
($25,000,000.00) or, if less, the aggregate unpaid principal amount of all
Revolving Loans shown on the schedule attached hereto (and any continuation
thereof) made by the Lender pursuant to that certain Credit Agreement, dated as
of February 20, 1998 (as amended, supplemented, amended and restated or
otherwise modified from time to time, the "Credit Agreement"), among the
Borrower, the various financial institutions as are or may from time to time
become parties thereto, DLJ Capital Funding, Inc., as Syndication Agent, and
Wachovia Bank, N.A., as Administrative Agent.
The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement.
Payments of both principal and interest are to be made in lawful money of
the United States of America in same day or immediately available funds to the
account designated by the Administrative Agent pursuant to the Credit
Agreement.
This Note is one of the Revolving Notes referred to in, and evidences
Indebtedness incurred under, the Credit Agreement, to which reference is made
for a description of the security for this Note and for a statement of the
terms and conditions on which the Borrower is permitted and required to make
prepayments and repayments of principal of the Indebtedness evidenced by this
Note and on which such Indebtedness may be declared to be immediately due and
payable. Unless otherwise defined, terms used herein have the meanings
provided in the Credit Agreement.
All parties hereto, whether as makers, endorsers, or otherwise, severally
waive presentment for payment, demand, protest and notice of dishonor.
<PAGE> 88
THIS NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND SHALL BE DEEMED TO
BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW
YORK.
MEDAPHIS CORPORATION
By: _________________________________
Title:
<PAGE> 89
REVOLVING LOANS AND PRINCIPAL PAYMENTS
<TABLE>
<CAPTION>
=============================================================================================================
Amount of Revolving Amount of Principal Unpaid Principal
Loan Made Repaid Balance
--------------------- Interest -----------------------------------------
Base LIBO Period Base LIBO Base LIBO Notation
Date Rate Rate (If Applicable) Rate Rate Rate Rate Total Made By
=============================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
=============================================================================================================
</TABLE>
<PAGE> 90
EXHIBIT A-2
SWING LINE NOTE
$7,500,000.00 February 13, 1998
FOR VALUE RECEIVED, the undersigned, MEDAPHIS CORPORATION, a Delaware
corporation (the "Borrower"), promises to pay to the order of WACHOVIA BANK,
N.A. (the "Swing Line Lender") on the Stated Maturity Date (as defined in the
Credit Agreement referred to below) the principal sum of SEVEN MILLION FIVE
HUNDRED THOUSAND DOLLARS ($7,500,000.00) or, if less, the aggregate unpaid
principal amount of all Swing Line Loans made by the Swing Line Lender pursuant
to that certain Credit Agreement, dated as of February 13, 1998 (as amended,
supplemented, amended and restated or otherwise modified from time to time, the
"Credit Agreement"), among the Borrower, the various financial institutions as
are or may become parties thereto, DLJ Capital Funding, Inc., as Syndication
Agent and Wachovia Bank, N.A., as Administrative Agent.
The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement.
Payments of both principal and interest are to be made in lawful money of
the United States of America in same day or immediately available funds to the
account designated by the Swing Line Lender pursuant to the Credit Agreement.
This Swing Line Note is the Swing Line Note referred to in, and evidences
Indebtedness incurred under, the Credit Agreement, to which reference is made
for a description of the security for this Swing Line Note and for a statement
of the terms and conditions on which the Borrower is permitted and required to
make prepayments and repayments of principal of the Indebtedness evidenced by
this Swing Line Note and on which such Indebtedness may be declared to be
immediately due and payable.
All parties hereto, whether as makers, endorsers, or otherwise, severally
waive presentment for payment, demand, protest and notice of dishonor.
<PAGE> 91
THIS NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND SHALL BE DEEMED TO
BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW
YORK.
MEDAPHIS CORPORATION
By:
----------------------------
Title:
<PAGE> 92
SWING LINE LOANS AND PRINCIPAL PAYMENTS
<TABLE>
<CAPTION>
================================================================================
of Swing Amount of Outstanding
Line Principal Principal Notation
Date Loan Made Repaid Balance Total Made By
<S> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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- --------------------------------------------------------------------------------
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- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
</TABLE>
<PAGE> 1
EXHIBIT 10.2
SUBSIDIARY GUARANTY
This SUBSIDIARY GUARANTY (as amended, supplemented, amended and
restated or otherwise modified from time to time, this "Guaranty"), dated as of
February 13, 1998, is made by each of the signatories hereto and each other
Person which may from time to time hereafter become a party hereto pursuant to
Section 5.5 (each, individually, an "Additional Guarantor", and collectively,
the "Additional Guarantors", and together with each of the signatories hereto,
each, individually, a "Guarantor", and, collectively, the "Guarantors"), in
favor of WACHOVIA BANK, N.A. ("Wachovia"), as administrative agent (together
with any successor(s) thereto in such capacity, the "Administrative Agent") for
each of the Secured Parties.
WITNESSETH:
WHEREAS, pursuant to a Credit Agreement, dated as of February 13, 1998
(as amended, supplemented, amended and restated or otherwise modified from time
to time, the "Credit Agreement"), among Medaphis Corporation, a Delaware
corporation (the "Borrower"), the various financial institutions from time to
time parties thereto (the "Lenders"), DLJ Capital Funding, Inc., as Syndication
Agent, and the Administrative Agent, the Lenders and the Issuer have extended
Commitments to make Credit Extensions to the Borrower;
WHEREAS, as a condition precedent to the making of the Credit
Extensions (including the initial Credit Extension) under the Credit Agreement,
each Guarantor is required to execute and deliver this Guaranty;
WHEREAS, each Guarantor has duly authorized the execution, delivery and
performance of this Guaranty; and
WHEREAS, it is in the best interests of each Guarantor to execute this
Guaranty inasmuch as each Guarantor will derive substantial direct and indirect
benefits from the Credit Extensions made from time to time to the Borrower by
the Lenders and the Issuer pursuant to the Credit Agreement;
NOW THEREFORE, for good and valuable consideration the receipt of which
is hereby acknowledged, and in order to induce the Lenders and the Issuer to
make Credit Extensions (including the initial Credit Extension) to the Borrower
pursuant to the Credit Agreement, and to induce Secured Parties to enter into
Rate Protection Agreements, and to induce Wachovia to maintain the Cash
Management Agreements, each Guarantor agrees, in favor of the Administrative
Agent and for the benefit of each Secured Party, as follows:
<PAGE> 2
ARTICLE I
DEFINITIONS
SECTION 1.1. Certain Terms. The following terms (whether or not
underscored) when used in this Guaranty, including its preamble and recitals,
shall have the following meanings (such definitions to be equally applicable to
the singular and plural forms thereof):
"Additional Guarantor" and "Additional Guarantors" are defined in the
preamble.
"Administrative Agent" is defined in the preamble.
"Borrower" is defined in the first recital.
"Credit Agreement" is defined in the first recital.
"Guarantor" and "Guarantors" are defined in the preamble.
"Guaranty" is defined in the preamble.
"Lenders" are defined in the first recital.
SECTION 1.2. Credit Agreement Definitions. Unless otherwise defined
herein or the context otherwise requires, terms used in this Guaranty, including
its preamble and recitals, have the meanings provided in the Credit Agreement.
ARTICLE II
GUARANTY PROVISIONS
SECTION 2.1. Guaranty. Each Guarantor hereby absolutely,
unconditionally and irrevocably
(a) guarantees the full and punctual payment when due, whether
at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise, of all Obligations of the Borrower and each other
Obligor now or hereafter existing, whether for principal, interest,
fees, expenses or otherwise (including all such amounts which would
become due but for the operation of the automatic stay under Section
362(a) of the United States Bankruptcy Code, 11 U.S.C. ss.362(a), and
the operation of Sections 502(b) and 506(b) of the United States
Bankruptcy Code, 11 U. S.C. ss.502(b) and ss.506(b)), and 6(b)), and
-2-
<PAGE> 3
(b) indemnifies and holds harmless each Secured Party and each
holder of a Note for any and all costs and expenses (including
reasonable attorneys' fees and expenses) incurred by such Secured Party
or such holder, as the case may be, in enforcing any rights under this
Guaranty;
provided, however, that each Guarantor shall be liable under this Guaranty for
the maximum amount of such liability that can be hereby incurred without
rendering this Guaranty, as it relates to each Guarantor, voidable under
applicable law relating to fraudulent conveyance or fraudulent transfer, and not
for any greater amount. This Guaranty constitutes a guaranty of payment when due
and not of collection, and each Guarantor specifically agrees that it shall not
be necessary or required that any Secured Party or any holder of any Note
exercise any right, assert any claim or demand or enforce any remedy whatsoever
against the Borrower or any other Obligor (or any other Person) before or as a
condition to the obligations of each Guarantor hereunder. Notwithstanding
anything to the contrary contained in this Section 2.1, the Secured Parties and
the holders of Notes shall be collectively represented by a single counsel
selected by the Administrative Agent except for any such Secured Party or holder
of a Note that such counsel may not represent as a result of a conflict of
interest.
SECTION 2.2. Acceleration of Guaranty. Each Guarantor agrees that, in
the event of the dissolution or insolvency of the Borrower, any other Obligor or
any other Guarantor, or the inability or failure of the Borrower, any other
Obligor or any other Guarantor to pay debts as they become due, or an assignment
by the Borrower, any other Obligor or any other Guarantor for the benefit of
creditors, or the commencement of any case or proceeding in respect of the
Borrower, any other Obligor or any other Guarantor under any bankruptcy,
insolvency or similar laws, and if such event shall occur at a time when any of
the Obligations of the Borrower and each other Obligor may not then be due and
payable, each Guarantor agrees that it will pay to the Lenders forthwith the
full amount which would be payable hereunder by each Guarantor if all such
Obligations were then due and payable.
SECTION 2.3. Guaranty Absolute, etc. This Guaranty shall in all
respects be a continuing, absolute, unconditional and irrevocable guaranty of
payment, and shall remain in full force and effect until all then accrued or due
and payable monetary Obligations of the Borrower and each other Obligor have
been paid in full, all Letters of Credit have been terminated, cash
collateralized or expired and all Commitments shall have terminated. Each
Guarantor guarantees that the Obligations of the Borrower and each other Obligor
will be paid strictly in accordance with the terms of the Credit Agreement, the
Notes and each other Loan Document under which they arise, regardless of any
law, regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of any Secured Party or any holder of
any Note with respect thereto. The liability of each Guarantor under this
Guaranty shall be absolute, unconditional and irrevocable irrespective of:
(a) any lack of validity, legality or enforceability of the
Credit Agreement, any Note or any other Loan Document or any of the
Cash Management Agreements;
-3-
<PAGE> 4
(b) the failure of any Secured Party or any holder of any Note
(i) to assert any claim or demand or to enforce any
right or remedy against the Borrower, any other Obligor or any
other Person (including any other guarantor (including any
Guarantor)) under the provisions of the Credit Agreement, any
Note, any other Loan Document or any of the Cash Management
Agreements or otherwise, or
(ii) to exercise any right or remedy against any
other guarantor (including any Guarantor) of, or collateral
securing, any Obligations of the Borrower or any other
Obligor;
(c) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Obligations of the Borrower or
any other Obligor, or any other extension, compromise or renewal of any
Obligation of the Borrower or any other Obligor;
(d) any reduction, limitation, impairment or termination of
any Obligations of the Borrower or any other Obligor for any reason,
including any claim of waiver, release, surrender, alteration or
compromise, and shall not be subject to (and each Guarantor hereby
waives any right to or claim of) any defense or setoff, counterclaim,
recoupment or termination whatsoever by reason of the invalidity,
illegality, nongenuineness, irregularity, compromise, unenforceability
of, or any other event or occurrence affecting, any Obligations of the
Borrower, any other Obligor or otherwise;
(e) any amendment to, rescission, waiver, or other
modification of, or any consent to departure from, any of the terms of
the Credit Agreement, any Note or any other Loan Document or any of the
Cash Management Agreements;
(f) any addition, exchange, release, surrender or
non-perfection of any collateral, or any amendment to or waiver or
release or addition of, or consent to departure from, any other
guaranty, held by any Secured Party or any holder of any Note securing
any of the Obligations of the Borrower or any other Obligor; or
(g) any other circumstance which might otherwise constitute a
defense available to, or a legal or equitable discharge of, the
Borrower, any other Obligor, any surety or any guarantor.
SECTION 2.4. Reinstatement, etc. Each Guarantor agrees that this
Guaranty shall continue to be effective or be reinstated, as the case may be, if
at any time any payment (in whole or in part) of any of the Obligations is
rescinded or must otherwise be restored by any Secured
-4-
<PAGE> 5
Party or any holder of any Note, upon the insolvency, bankruptcy or
reorganization of the Borrower, any other Obligor or otherwise, all as though
such payment had not been made.
SECTION 2.5. Waiver. etc. Each Guarantor hereby waives promptness,
diligence, notice of acceptance and any other notice with respect to any of the
Obligations of the Borrower or any other Obligor and this Guaranty and any
requirement that the Administrative Agent, any other Secured Party or any holder
of any Note protect, secure, perfect or insure any security interest or Lien, or
any property subject thereto, or exhaust any right or take any action against
the Borrower, any other Obligor or any other Person (including any other
guarantor) or entity or any collateral securing the Obligations of the Borrower
or any other Obligor, as the case may be.
SECTION 2.6. Postponement of Subrogation, etc. Each Guarantor hereby
agrees that it will not exercise any rights which it may acquire by way of
rights of subrogation under this Guaranty, by any payment made hereunder or
otherwise, until all then accrued or due and payable monetary Obligations of the
Borrower and each other Obligor have been paid in full, all Letters of Credit
have been terminated, cash-collateralized or expired and all Commitments shall
have terminated. Any amount paid to any Guarantor on account of any such
subrogation rights prior to the payment in full of all Obligations of the
Borrower and each other Obligor shall be held in trust for the benefit of the
Secured Parties and each holder of a Note and shall immediately be paid to the
Administrative Agent for the benefit of the Secured Parties and each holder of a
Note and credited and applied against the Obligations of the Borrower and each
other Obligor, whether matured or unmatured, in accordance with the terms of the
Credit Agreement; provided, however, that if
(a) such Guarantor has made payment to the Secured Parties and
each holder of a Note of all or any part of the Obligations of the
Borrower and each other Obligor, and
(b) all Obligations of the Borrower and each other Obligor
have been paid in full, all Letters of Credit have been terminated,
cash-collateralized or expired and all Commitments have been
permanently terminated;
each Secured Party and each holder of a Note agrees that, at such Guarantor's
request, the Administrative Agent, on behalf of the Secured Parties and the
holders of the Notes, will execute and deliver to such Guarantor appropriate
documents (without recourse and without representation or warranty) necessary to
evidence the transfer by subrogation to such Guarantor of an interest in the
Obligations of the Borrower and each other Obligor resulting from such payment
by such Guarantor. In furtherance of the foregoing, for so long as any then
accrued or due and payable monetary Obligations, Letters or Credit or
Commitments remain outstanding, each Guarantor shall refrain from taking any
action or commencing any proceeding against the Borrower or any other Obligor
(or its successors or assigns, whether in connection with a bankruptcy
proceeding or otherwise) to recover any amounts in the respect of payments made
under this Guaranty to any Secured Party or any holder of a Note.
-5-
<PAGE> 6
SECTION 2.7. Successors. Transferees and Assigns; Transfers of Notes,
etc. This Guaranty shall:
(a) be binding upon each Guarantor, and its successors,
transferees and assigns; and
(b) inure to the benefit of and be enforceable by the
Administrative Agent and each other Secured Party.
Without limiting the generality of the foregoing clause (b), any Lender may
assign or otherwise transfer (in whole or in part) any Note or Credit Extension
held by it to any other Person or entity, and such other Person or entity shall
thereupon become vested with all rights and benefits in respect thereof granted
to such Lender under any Loan Document (including this Guaranty) or otherwise,
subject, however, to any contrary provisions in such assignment or transfer, and
to the provisions of Section 10.11 and Article IX of the Credit Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties. Each Guarantor hereby
represents and warrants for itself unto each Secured Party as to all matters
contained in Article VI of the Credit Agreement insofar as the representations
and warranties contained therein are applicable to such Guarantor or such
Guarantor's properties, are true and correct in all material respects, each such
representation and warranty set forth in such Article (insofar as applicable as
aforesaid) and all other terms of the Credit Agreement to which reference is
made therein, together with all related definitions and ancillary provisions,
all of which are hereby incorporated into this Guaranty as though specifically
set forth in this Article.
ARTICLE IV
COVENANTS, ETC.
SECTION 4.1. Affirmative Covenants. Each Guarantor covenants and agrees
that, so long as any portion of the Obligations shall remain unpaid, any Letters
of Credit shall be outstanding or any Lender shall have any outstanding
Commitment, it will, unless the Required Lenders shall otherwise consent in
writing, perform, comply with and be bound by all of the agreements, covenants
and obligations contained in Article VII of the Credit Agreement which are
applicable to such Guarantor or its properties, each such agreement, covenant
and obligation contained in such Article and all other terms of the Credit
Agreement to which reference is made
-6-
<PAGE> 7
herein, together with all related definitions and ancillary provisions, being
hereby incorporated into this Guaranty by reference as though specifically set
forth in this Article.
ARTICLE V
MISCELLANEOUS PROVISIONS
SECTION 5.1. Loan Document. This Guaranty is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions thereof, including Article X thereof.
SECTION 5.2. Binding on Successors, Transferees and Assigns;
Assignment. In addition to, and not in limitation of, Section 2.7, this Guaranty
shall be binding upon each Guarantor and its successors, transferees and assigns
and shall inure to the benefit of and be enforceable by each Secured Party and
each holder of a Note and their respective successors, transferees and assigns
(to the full extent provided pursuant to Section 2.7); provided, however, that,
except as otherwise permitted under the Credit Agreement, no Guarantor may
assign any of its obligations hereunder without the prior written consent of all
Lenders.
SECTION 5.3. Amendments. etc. No amendment to or waiver of any
provision of this Guaranty, nor consent to any departure by any Guarantor here-
from, shall in any event be effective unless the same shall be in writing and
signed by the Administrative Agent (on behalf of the Lenders or the Required
Lenders, as the case may be) and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
SECTION 5.4. Notices. All notices and other communications provided for
hereunder shall be in writing and mailed or telecopied or delivered, if to a
Guarantor, to such Guarantor in care of the Borrower at the address of the
Borrower specified in the Credit Agreement, and, if to the Administrative Agent,
to the Administrative Agent at the address of the Administrative Agent specified
in the Credit Agreement, or as to any party, at such other address as shall be
designated by such party in a written notice to the Agent or the Guarantors (in
care of the Borrower), as the case may be, complying as to delivery with the
terms of this Section. All such notices and other communications, if mailed and
properly addressed with postage prepaid or if properly addressed and sent by
pre-paid courier service, shall be deemed given when received; any such notice
or communication, if transmitted by facsimile, shall be deemed given when the
confirmation thereof is received by the transmitter.
SECTION 5. 5. Additional Guarantors. Upon the execution and delivery by
any other Person of an instrument in the form of Annex I hereto, such Person
shall become a "Guarantor" hereunder with the same force and effect as if
originally named as a Guarantor herein. The execution and delivery of any such
instrument shall not require the consent of any other Guarantor
-7-
<PAGE> 8
hereunder. The rights and obligations of each Guarantor hereunder shall remain
in full force and effect notwithstanding the addition of any new Guarantor as a
party to this Guaranty.
SECTION 5.6. No Waiver; Remedies. In addition to, and not in limitation
of, Section 2.3 and Section 2.5, no failure on the part of any Secured Party or
any holder of a Note to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right hereunder preclude any other or further exercise thereof
or the exercise of any other right. The remedies herein provided are cumulative
and not exclusive of any remedies provided by law.
SECTION 5.7. Captions. Section captions used in this Guaranty are for
convenience of reference only, and shall not affect the construction of this
Guaranty.
SECTION 5.8. Setoff. In addition to, and not in limitation of, any
rights of any Secured Party or any holder of a Note under applicable law, each
Secured Party and each such holder shall, upon the occurrence of any Default
described in any of clauses (a) through (d) of Section 8.1.9 of the Credit
Agreement or with the consent of the Required Lenders, any Event of Default
described in Section 8.1.1 of the Credit Agreement or any acceleration of the
Obligations (in whole or in part), have the right to appropriate and apply to
the payment of the obligations of any Guarantor owing to it hereunder, whether
or not then due, and such Guarantor hereby grants to each Secured Party and each
such holder a continuing security interest in, any and all balances, credits,
deposits, accounts or moneys of such Guarantor then or thereafter maintained
with such Secured Party, or such holder or any agent or bailee for such Secured
Party or such holder; provided, however, that any such appropriation and
application shall be subject to the provisions of Section 4.8 of the Credit
Agreement.
SECTION 5.9. Severability. Wherever possible each provision of this
Guaranty shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Guaranty shall be prohibited by or
invalid under such law, such provision shall be ineffective to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Guaranty.
SECTION 5.10. Governing Law, Entire Agreement, etc. THIS GUARANTY SHALL
BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK. THIS GUARANTY AND THE OTHER LOAN DOCUMENTS CONSTITUTE THE
ENTIRE UNDERSTANDING AMONG THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER
HEREOF AND THEREOF AND SUPERSEDE ANY PRIOR AGREEMENTS, WRITTEN OR ORAL, WITH
RESPECT THERETO.
SECTION 5.11. Forum Selection and Consent to Jurisdiction. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
GUARANTY OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR
-8-
<PAGE> 9
WRITTEN) OR ACTIONS OF ANY SECURED PARTY OR ANY GUARANTOR IN CONNECTION HEREWITH
OR THEREWITH MAY BE BROUGHT AND MAINTAINED IN THE COURTS OF THE STATE OF NEW
YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY
COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE AGENTS' OPTION, IN THE
COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND.
EACH GUARANTOR IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW
YORK AT THE ADDRESS FOR NOTICE SPECIFIED IN SECTION 5 4. EACH GUARANTOR HEREBY
EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH ANY OF THEM MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF
VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY
CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE
EXTENT THAT ANY GUARANTOR HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM
JURISDICTION OF ANY COURT OF FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR
NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR
OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, EACH GUARANTOR HEREBY
IRREVOCABLY WAIVES (TO THE FULLEST EXTENT PERMITTED BY LAW) SUCH IMMUNITY IN
RESPECT OF ITS OBLIGATIONS UNDER THIS GUARANTY AND THE OTHER LOAN DOCUMENTS.
SECTION 5 12 Waiver of Jury Trial. THE SECURED PARTIES AND THE
GUARANTORS HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE (TO THE FULLEST
EXTENT PERMITTED BY LAW) ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH,
THIS GUARANTY OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE SECURED PARTIES
OR THE GUARANTORS IN CONNECTION HEREWITH OR THEREWITH. THE GUARANTORS
ACKNOWLEDGE AND AGREE THAT EACH SUCH PERSON HAS RECEIVED FULL AND SUFFICIENT
CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF EACH OTHER LOAN
DOCUMENT TO WHICH SUCH PERSON IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL
INDUCEMENT FOR THE SECURED PARTIES ENTERING INTO THE CREDIT AGREEMENT, THIS
GUARANTY AND EACH SUCH OTHER LOAN DOCUMENT.
-9-
<PAGE> 10
SECTION 5.13. Counterparts. This Guaranty may be executed by the
parties hereto in several counterparts, each of which shall be deemed to be an
original and all of which shall constitute together but one and the same
agreement.
SECTION 5. 14. Termination. This Guaranty and all the covenants,
agreements and other obligations of the Guarantors hereunder (other than the
obligations set forth in clause (b) of Section 2.1 ) shall terminate when all
the Commitments have expired or terminated, all then accrued or due and payable
monetary Obligations have been paid in full and all Letters of Credit have
expired, terminated, or been cash-collateralized in the amount of the Letter of
Credit Outstandings.
-10-
<PAGE> 11
IN WITNESS WHEREOF, the parties hereto have caused this Guaranty to be
duly executed and delivered by their respective officers hereunto duly
authorized as of the date first above written.
ASSETCARE, INC., a Georgia corporation
By
-------------------------------------------
Name:
Title:
AUTOMATION ATWORK, a California corporation
By
-------------------------------------------
Name:
Title:
BSG ALLIANCE/IT, INC., a Delaware corporation
By
-------------------------------------------
Name:
Title:
BSG CORPORATION, a Delaware corporation
By
-------------------------------------------
Name:
Title:
<PAGE> 12
BSG GOVERNMENT SOLUTIONS, INC., a
Maryland corporation
By
-------------------------------------------
Name:
Title:
CONSORT TECHNOLOGIES, INC., a
Georgia corporation
By
-------------------------------------------
Name:
Title:
GOTTLIEB'S FINANCIAL SERVICES,
INC., a Georgia corporation
By
-------------------------------------------
Name:
Title:
HEALTH DATA SCIENCES
CORPORATION, a Delaware corporation
By
-------------------------------------------
Name:
Title:
<PAGE> 13
MEDAPHIS HEALTHCARE INFORMATION
TECHNOLOGY COMPANY, a Georgia
corporation
By
-------------------------------------------
Name:
Title:
MEDAPHIS PHYSICIAN SERVICES
CORPORATION, a Georgia corporation
By
-------------------------------------------
Name:
Title:
MEDAPHIS SERVICES CORPORATION, a
Georgia corporation
By
-------------------------------------------
Name:
Title:
MEDICAL MANAGEMENT SCIENCES, INC., a
Maryland corporation
By
-------------------------------------------
Name:
Title:
NATIONAL HEALTHCARE TECHNOLOGIES,
INC., a Indiana corporation
By
-------------------------------------------
Name:
Title:
<PAGE> 14
ACCEPTED BY:
WACHOVIA BANK, N.A.,
as Administrative Agent
By
-------------------------------------------
Name:
Title:
<PAGE> 15
ANNEX I to
Subsidiary Guaranty
SUPPLEMENT NO. _____ dated as of _____________ __,
______ (this "Supplement"), to the Subsidiary
Guaranty, dated as of ____________ ____; ____ (as
amended, supplemented, amended and restated or
otherwise modified from time to time, the
"Guaranty"), among the initial signatories thereto
and each other Person which from time to time
thereafter became a party thereto pursuant to Section
5.5 thereof (each, individually, a "Guarantor", and,
collectively, the "Guarantors"), in favor of the
Secured Parties (as defined in the Guaranty).
WITNESSETH:
WHEREAS, capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to such terms in the Guaranty; and
WHEREAS, the Guaranty provides that additional parties may become
Guarantors under the Guaranty by execution and delivery of an instrument in the
form of this Supplement; and
WHEREAS, pursuant to the provisions of Section 5.5 of the Guaranty, the
undersigned is becoming an Additional Guarantor under the Guaranty; and
WHEREAS, the undersigned desires to become a Guarantor under the
Guaranty in order to induce the Secured Parties to continue to make Credit
Extensions under the Credit Agreement as consideration therefor;
NOW, THEREFORE, the undersigned agrees, for the benefit of each Secured
Party, as follows:
SECTION 1. In accordance with the Guaranty, the undersigned by its
signature below becomes a Guarantor under the Guaranty with the same force and
effect as if it were an original signatory thereto as a Guarantor and the
undersigned hereby (a) agrees to all the terms and provisions of the Guaranty
applicable to it as a Guarantor thereunder and (b) represents and warrants that
the representations and warranties made by it as a Guarantor thereunder are true
and correct on and as of the date hereof. In furtherance of the foregoing, each
reference to a "Guarantor" or an "Additional Guarantor" in the Guaranty shall be
deemed to include the undersigned.
SECTION 2. The undersigned hereby represents and warrants that this
Supplement has been duly authorized, executed and delivered by the undersigned
and constitutes a legal, valid and binding obligation of the undersigned,
enforceable against it in accordance with its terms.
<PAGE> 16
SECTION 3. Except as expressly supplemented hereby, the Guaranty shall
remain in full force and effect in accordance with its terms.
SECTION 4. In the event any one or more of the provisions contained in
this Supplement should be held invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions contained
herein and in the Guaranty shall not in any way be affected or impaired.
SECTION 5. Without limiting the provisions of the Credit Agreement (or
any other Loan Document, including the Guaranty), the undersigned agrees to
reimburse the Administrative Agent for its reasonable out-of-pocket expenses in
connection with this Supplement, including reasonable attorneys' fees and
expenses of the Administrative Agent.
SECTION 6. THIS SUPPLEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER
AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK.
SECTION 7. WITHOUT LIMITING THE EFFECT OF SECTION 5.11 OF THE GUARANTY,
THE SECURED PARTIES AND THE UNDERSIGNED HEREBY EXPRESSLY AND IRREVOCABLY SUBMIT
TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, AND OF THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, IN EACH CASE
LOCATED IN NEW YORK COUNTY OF THE STATE OF NEW YORK, FOR THE PURPOSE OF ANY SUCH
LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT
RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION. THE UNDERSIGNED IRREVOCABLY
CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY
PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK. THE UNDERSIGNED HEREBY
EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY
SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT
ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT
THAT THE UNDERSIGNED HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION
OF ANY COURT OF FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE,
ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH
RESPECT TO ITSELF OR ITS PROPERTY, THE UNDERSIGNED HEREBY IRREVOCABLY WAIVES (TO
THE EXTENT PERMITTED UNDER APPLICABLE LAW) SUCH IMMUNITY IN RESPECT OF ITS
OBLIGATIONS UNDER THIS SUPPLEMENT, THE GUARANTY AND THE OTHER LOAN DOCUMENTS.
SECTION 8. WITHOUT LIMITING THE EFFECT OF SECTION 5.12 OF THE GUARANTY,
THE SECURED PARTIES AND THE UNDERSIGNED HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHTS
-2-
<PAGE> 17
THEY MAY HAVE TO A TRIAL BY JURY 12 RESPECT OF ANY LITIGATION BASED HEREON, OR
ARISING OUT OF, UNDER OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL
OR WRITTEN) OR ACTIONS OF THE SECURED PARTIES OR THE UNDERSIGNED RELATING
THERETO. THE UNDERSIGNED ACKNOWLEDGES AND AGREES THAT EACH SUCH PERSON HAS
RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER
PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH SUCH PERSON IS A PARTY) AND THAT
THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE SECURED PARTIES ENTERING INTO
THE CREDIT AGREEMENT, THIS SUPPLEMENT, THE GUARANTY AND EACH SUCH OTHER LOAN
DOCUMENT.
SECTION 9. This Supplement hereby incorporates by reference the
provisions of the Guaranty, which provisions are deemed to be a part hereof, and
this Supplement shall be deemed to be a part of the Guaranty.
SECTION 10. This Supplement may be executed by the parties hereto in
several counterparts, each of which shall be deemed to be an original and all of
which shall constitute together but one and the same agreement.
-3-
<PAGE> 18
IN WITNESS WHEREOF, the parties hereto have caused this Supplement to
the Guaranty to be duly executed and delivered by their respective officers
thereunto duly authorized as of the day and year first above written.
[ADDITIONAL GUARANTOR],
a
--------------- --------------
By
-------------------------------------------
Name:
Title:
ACCEPTED BY:
WACHOVIA BANK, N.A.,
as Administrative Agent
By
------------------------------------------
Name:
Title:
<PAGE> 1
EXHIBIT 10.3
MEDAPHIS CORPORATION
AS ISSUER
AND
THE SUBSIDIARY GUARANTORS
NAMED HEREIN
$175,000,000
9 1/2% SENIOR NOTES
DUE FEBRUARY 15, 2005
-------------
INDENTURE
DATED AS OF FEBRUARY 20, 1998
-------------
STATE STREET BANK AND TRUST COMPANY
TRUSTEE
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
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<S> <C> <C>
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions.......................................................................... 1
Section 1.02 Other Definitions.................................................................... 20
Section 1.03 Incorporation by Reference of Trust Indenture Act.................................... 21
Section 1.04 Rules of Construction................................................................ 21
ARTICLE 2
THE NOTES
Section 2.01 Form and Dating...................................................................... 22
Section 2.02 Execution and Authentication......................................................... 23
Section 2.03 Registrar and Paying Agent........................................................... 24
Section 2.04 Paying Agent to Hold Money in Trust.................................................. 24
Section 2.05 Holder Lists......................................................................... 25
Section 2.06 Transfer and Exchange................................................................ 25
Section 2.07 Replacement Notes.................................................................... 40
Section 2.08 Outstanding Notes.................................................................... 40
Section 2.09 Treasury Notes....................................................................... 40
Section 2.10 Temporary Notes...................................................................... 41
Section 2.11 Cancellation......................................................................... 41
Section 2.12 Defaulted Interest................................................................... 41
ARTICLE 3
REDEMPTION
Section 3.01 Notices to Trustee................................................................... 42
Section 3.02 Selection of Notes to Be Redeemed.................................................... 42
Section 3.03 Notice of Redemption................................................................. 42
Section 3.04 Effect of Notice of Redemption....................................................... 43
Section 3.05 Deposit of Redemption Price.......................................................... 43
Section 3.06 Notes Redeemed in Part............................................................... 44
Section 3.07 Optional Redemption.................................................................. 44
Section 3.08 No Mandatory Redemption.............................................................. 45
</TABLE>
i
<PAGE> 3
<TABLE>
<CAPTION>
PAGE
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<S> <C> <C>
ARTICLE 4
COVENANTS
Section 4.01 Payment of Notes..................................................................... 45
Section 4.02 Maintenance of Office or Agency...................................................... 45
Section 4.03 Reports.............................................................................. 46
Section 4.04 Compliance Certificate............................................................... 46
Section 4.05 Taxes................................................................................ 47
Section 4.06 Stay, Extension and Usury Laws....................................................... 47
Section 4.07 Change of Control.................................................................... 48
Section 4.08 Asset Sales.......................................................................... 50
Section 4.09 Restricted Payments.................................................................. 52
Section 4.10 Incurrence of Indebtedness and Issuance of Disqualified Stock........................ 56
Section 4.11 Liens................................................................................ 58
Section 4.12 Dividend and Other Payment Restrictions Affecting Subsidiaries....................... 59
Section 4.13 Transactions with Affiliates......................................................... 60
Section 4.14 Sale and Leaseback Transactions...................................................... 60
Section 4.15 Additional Subsidiary Guarantees..................................................... 61
ARTICLE 5
SUCCESSORS
Section 5.01 Merger, Consolidation or Sale of Assets.............................................. 61
Section 5.02 Successor Corporation Substituted.................................................... 62
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01 Events of Default.................................................................... 62
Section 6.02 Acceleration......................................................................... 64
Section 6.03 Other Remedies....................................................................... 65
Section 6.04 Waiver of Past Defaults.............................................................. 65
Section 6.05 Control by Majority.................................................................. 65
Section 6.06 Limitation on Suits.................................................................. 66
Section 6.07 Rights of Holders of Notes to Receive Payment........................................ 66
Section 6.08 Collection Suit by Trustee........................................................... 66
Section 6.09 Trustee May File Proofs of Claim..................................................... 67
Section 6.10 Priorities........................................................................... 67
Section 6.11 Undertaking for Costs................................................................ 68
</TABLE>
ii
<PAGE> 4
<TABLE>
<CAPTION>
PAGE
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<S> <C> <C>
ARTICLE 7
TRUSTEE
Section 7.01 Duties of Trustee.................................................................... 68
Section 7.02 Rights of Trustee.................................................................... 69
Section 7.03 Individual Rights of Trustee......................................................... 71
Section 7.04 Trustee's Disclaimer................................................................. 71
Section 7.05 Notice of Defaults................................................................... 71
Section 7.06 Reports by Trustee to Holders of the Notes........................................... 71
Section 7.07 Compensation and Indemnity........................................................... 72
Section 7.08 Replacement of Trustee............................................................... 73
Section 7.09 Successor Trustee by Merger, etc..................................................... 74
Section 7.10 Eligibility; Disqualification........................................................ 74
Section 7.11 Preferential Collection of Claims Against Company.................................... 74
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance............................. 75
Section 8.02 Legal Defeasance and Discharge....................................................... 75
Section 8.03 Covenant Defeasance.................................................................. 75
Section 8.04 Conditions to Legal or Covenant Defeasance........................................... 76
Section 8.05 Deposited Money and Government Securities to be Held in Trust; Other
Miscellaneous Provisions............................................................. 77
Section 8.06 Repayment to Company................................................................. 78
Section 8.07 Reinstatement........................................................................ 78
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes.................................................. 79
Section 9.02 With Consent of Holders of Notes..................................................... 80
Section 9.03 Compliance with Trust Indenture Act.................................................. 81
Section 9.04 Revocation and Effect of Consents.................................................... 81
Section 9.05 Notation on or Exchange of Notes..................................................... 82
Section 9.06 Trustee to Sign Amendments, etc...................................................... 82
</TABLE>
iii
<PAGE> 5
<TABLE>
<CAPTION>
PAGE
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<S> <C> <C>
ARTICLE 10
SUBSIDIARY GUARANTEES
Section 10.01 Subsidiary Guarantees................................................................ 82
Section 10.02 Execution and Delivery of Subsidiary Guarantees...................................... 84
Section 10.03 Subsidiary Guarantors May Consolidate, etc., on Certain Terms........................ 85
Section 10.04 Releases............................................................................. 86
Section 10.05 Limitation of Subsidiary Guarantor's Liability....................................... 87
Section 10.06 Application of Certain Terms and Provisions to the Subsidiary
Guarantors........................................................................... 87
ARTICLE 11
MISCELLANEOUS
Section 11.01 Trust Indenture Act Controls......................................................... 88
Section 11.02 Notices.............................................................................. 88
Section 11.03 Communication by Holders of Notes with Other Holders of Notes........................ 89
Section 11.04 Certificate and Opinion as to Conditions Precedent................................... 89
Section 11.05 Statements Required in Certificate or Opinion........................................ 90
Section 11.06 Rules by Trustee and Agents.......................................................... 90
Section 11.07 No Personal Liability of Directors, Officers, Employees and
Stockholders......................................................................... 90
Section 11.08 Governing Law........................................................................ 90
Section 11.09 No Adverse Interpretation of Other Agreements........................................ 91
Section 11.10 Successors........................................................................... 91
Section 11.11 Severability......................................................................... 91
Section 11.12 Counterpart Originals................................................................ 91
Section 11.13 Table of Contents, Headings, etc..................................................... 91
EXHIBITS
EXHIBIT A FORM OF NOTE AND SUBSIDIARY GUARANTEE
EXHIBIT B FORM OF CERTIFICATE OF TRANSFER
EXHIBIT C FORM OF CERTIFICATE OF EXCHANGE
EXHIBIT D FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL
ACCREDITED INVESTOR
EXHIBIT E FORM OF SUPPLEMENTAL INDENTURE
</TABLE>
iv
<PAGE> 6
INDENTURE, dated as of February 20, 1998, among Medaphis
Corporation, a Delaware corporation (the "Company"), the Subsidiary Guarantors
(as defined) and State Street Bank and Trust Company, as trustee (the
"Trustee").
Each party agrees as follows for the benefit of each other and
for the equal and ratable benefit of the Holders of the 9 1/2% Series A Senior
Notes due 2005 (the "Series A Notes") and the 9 1/2% Series B Senior Notes due
2005 (the "Series B Notes" and, together with the Series A Notes, the "Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
SECTION 1.01 DEFINITIONS
"144A Global Note" means a global note in the form of Exhibit
A hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with or on behalf of, and registered in the name of, the Depositary or
its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes sold in reliance on Rule 144A.
"Accrued Bankruptcy Interest" means, with respect to any
Indebtedness, all interest accruing thereon after the filing of a petition by or
against the Company or any of its Subsidiaries under any Bankruptcy Law, in
accordance with and at the rate (including any rate applicable upon any default
or event of default, to the extent lawful) specified in the documents evidencing
or governing such Indebtedness, whether or not the claim for such interest is
allowed as a claim after such filing in any proceeding under such Bankruptcy
Law.
"Acquired Indebtedness" means, with respect to any specified
Person, (i) Indebtedness of any other Person existing at the time such other
Person is merged with or into or became a Subsidiary of such specified Person,
including, without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person, and (ii) Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling,"
"controlled by" and "under common control with"), as used with respect to any
Person, will mean the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of such Person, whether
through the ownership of voting securities, by agreement or otherwise.
"Agent" means any Registrar, Paying Agent or co-registrar.
<PAGE> 7
2
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Cedel that apply to such transfer or
exchange.
"Asset Sale" means (i) the sale, lease, conveyance or other
disposition of any assets or rights (including, without limitation, by way of a
sale and leaseback, but excluding by way of granting or, or foreclosure upon, a
Lien) (provided that the sale, lease, conveyance or other disposition of all or
substantially all of the assets of the Company and its Subsidiaries, taken as a
whole, will be governed by Section 4.07 and/or Section 5.01 and not by Section
4.08), whether in a single transaction or a series of related transactions (a)
that have a fair market value in excess of $1,000,000 or (b) for Net Proceeds in
excess of $1,000,000 and (ii) the issue or sale by the Company or any of its
Restricted Subsidiaries of Equity Interests of any of the Company's
Subsidiaries. Notwithstanding the foregoing, the following items shall not be
deemed to be Asset Sales: (i) a transfer of assets by the Company to a
Subsidiary Guarantor or by a Restricted Subsidiary to the Company or to a
Subsidiary Guarantor or by a Restricted Subsidiary that is not a Subsidiary
Guarantor to another Restricted Subsidiary, (ii) an issuance of Equity Interests
by a Restricted Subsidiary to the Company or to a Subsidiary Guarantor or an
issuance of Equity Interests by a Restricted Subsidiary pro rata to all of its
holders of one or more classes of Equity Interests in a manner that does not
dilute the Equity Interests of the Company or such Subsidiary Guarantor, as the
case may be, (iii) a Restricted Payment that is permitted by Section 4.09 or a
Permitted Investment, (iv) sales or exchanges of inventory in the ordinary
course of business, (v) sales or exchanges of obsolete, surplus or outdated
equipment or abandoned reengineering assets no longer used or useful in the
business of the Company and its Restricted Subsidiaries, (vi) leases and
subleases (and licenses and sublicenses) of assets that are not treated as
Capital Leases on the books and records of the Company and its Restricted
Subsidiaries, (vii) the issuance of Equity Interests of a Restricted Subsidiary
to officers, employees or directors pursuant to any employee stock purchase plan
or similar employee benefit plan or arrangement in the ordinary course of
business and (viii) sales of accounts receivable and related assets of the type
specified in the definition of "Qualified Receivables Transaction" to a
Receivables Subsidiary for the fair market value thereof, including cash in an
amount at least equal to 75% of the book value thereof as determined in
accordance with GAAP.
"Attributable Debt" means in respect of a sale and leaseback
transaction, at the time of determination, the present value (discounted at the
rate of interest implicit in such transaction, determined in accordance with
GAAP) of the obligation of the lessee for net base rental payments during the
remaining term of the lease included in such sale and leaseback transaction
(including any period for which such lease has been extended or may, at the
option of the lessor, be extended).
"Board of Directors" means the Board of Directors of the
Company, or any authorized committee of the Board of Directors.
<PAGE> 8
3
"Board Resolution" means a resolution duly adopted by the
Board of Directors.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any
determination thereof is to be made, the amount of the liability in respect of a
capital lease that would at such time be required to be capitalized on a balance
sheet of the lessee in accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation,
corporate stock, (ii) in the case of an association or business entity, any and
all shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership or limited
liability company, partnership or membership interests (whether general or
limited) and (iv) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.
"Cash Equivalents" means (i) Government Securities, (ii)
certificates of deposit and eurodollar time deposits with maturities of six
months or less from the date of acquisition, bankers' acceptances with
maturities not exceeding six months and overnight bank deposits, in each case
with any lender party to the New Credit Facility or with any domestic commercial
or investment bank having capital and surplus in excess of $500,000,000, (iii)
repurchase obligations with a term of not more than 30 days for underlying
securities of the types described in clauses (i) and (ii) above entered into
with any financial institution meeting the qualifications specified in clause
(ii) above, (iv) commercial paper having a rating of at least A1 or P1 from
Moody's Investors Service, Inc. or Standard & Poor's Corporation, respectively,
and in each case maturing within six months after the date of acquisition and
(v) money market funds at least 95% of the assets of which constitute Cash
Equivalents of the kinds described in (i) (iv) of this definition.
"Cedel" means Cedel Bank, SA.
"Change of Control" means the occurrence of any of the
following: (i) the sale, lease, transfer, conveyance or other disposition (other
than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of the Company and its
Subsidiaries, taken as a whole, to any "person" (as such term is used in Section
13(d)(3) of the Exchange Act), (ii) the consummation of any transaction
(including, without limitation, any merger or consolidation) the result of which
is that any "person" (as defined above), becomes the "beneficial owner" (as such
term is defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that
a person shall be deemed to have "beneficial ownership" of all securities that
such person has the right to acquire, whether such right is currently
exercisable or is exercisable only upon the occurrence of a subsequent
condition),
<PAGE> 9
4
directly or indirectly, of more than 50% of the Voting Stock of the Company
(measured by voting power rather than number of shares), or (iii) the first day
on which a majority of the members of the entire Board of Directors are not
Continuing Directors. For purposes of this definition, any transfer of an equity
interest of an entity that was formed for the purpose of acquiring Voting Stock
of the Company shall be deemed to be a transfer of such portion of such Voting
Stock as corresponds to the portion of the equity of such entity that has been
so transferred.
"Consolidated Cash Flow" means, with respect to any Person for
any period, the Consolidated Net Income of such Person for such period plus (i)
an amount equal to any extraordinary loss plus any net loss realized in
connection with an Asset Sale (to the extent such losses were deducted in
computing such Consolidated Net Income), plus (ii) provision for taxes based on
income or profits of such Person and its Restricted Subsidiaries for such
period, to the extent that such provision for taxes was included in computing
such Consolidated Net Income, plus (iii) consolidated interest expense of such
Person and its Restricted Subsidiaries for such period, whether paid or accrued
and whether or not capitalized (including, without limitation, amortization of
debt issuance costs and original issue discount, non-cash interest payments, the
interest component of any deferred payment obligations, the interest component
of all payments associated with Capital Lease Obligations, imputed interest with
respect to Attributable Debt, commissions, discounts and other fees and charges
incurred in respect of letter of credit or bankers' acceptance financings, and
net payments (if any) pursuant to Hedging Obligations), to the extent that any
such expense was deducted in computing such Consolidated Net Income, plus (iv)
depreciation, amortization (including amortization of goodwill and other
intangibles but excluding amortization of prepaid cash expenses that were paid
in a prior period) and other non-cash expenses or charges (excluding any such
non-cash expense to the extent that it represents an accrual of or reserve for
cash expenses in any future period or amortization of a prepaid cash expense
that was paid in a prior period) of such Person and its Subsidiaries for such
period to the extent that such depreciation, amortization and other non-cash
expenses were deducted in computing such Consolidated Net Income, minus (v)
non-cash items (excluding any such non-cash item to the extent that it
represents a reversal of an accrual of or reserve for cash expenses in any
future period or amortization of a prepaid cash expense) increasing such
Consolidated Net Income for such period, in each case, on a consolidated basis
and determined in accordance with GAAP, plus (vi) without duplication,
restructuring and other extraordinary and unusual charges in an amount not
greater than $93,100,000 incurred during the year ended December 31, 1997, plus
(vii) without duplication, any deferred financing charges that shall be taken in
1998 as a result of this Offering. Notwithstanding the foregoing, the provision
for taxes on the income or profits of, and the depreciation and amortization and
other non-cash charges of, a Subsidiary of the referent Person shall be added to
Consolidated Net Income to compute Consolidated Cash Flow only to the extent
that a corresponding amount would be permitted at the date of determination to
be dividended to the Company by such Subsidiary without prior governmental
approval (unless such approval has been obtained), and without direct or
<PAGE> 10
5
indirect restriction pursuant to the terms of its charter and all agreements,
instruments, judgments, decrees, orders, statutes, rules and governmental
regulations applicable to that Subsidiary or its stockholders.
"Consolidated Net Income" means, with respect to any Person
for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; provided that (i) the Net Income (but not loss) of any
Person that is not a Subsidiary or that is accounted for by the equity method of
accounting shall be included only to the extent of the amount of dividends or
distributions paid in cash to the referent Person or to a Wholly Owned
Subsidiary thereof or to a Subsidiary Guarantor, (ii) the Net Income of any
Restricted Subsidiary shall be excluded to the extent that the declaration or
payment of dividends or similar distributions by that Restricted Subsidiary of
that Net Income is not at the date of determination permitted without any prior
governmental approval (unless such approval has been obtained) or, directly or
indirectly, by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to that Subsidiary or its stockholders, (iii) the Net Income of any
Person acquired in a pooling of interests transaction for any period prior to
the date of such acquisition shall be excluded, (iv) the cumulative effect of a
change in accounting principles shall be excluded and (v) the Net Income of any
Unrestricted Subsidiary shall be excluded, except without duplication to the
extent distributed to the Company or one of its Subsidiaries.
"Continuing Directors" means, as of any date of determination,
any member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the date of this Indenture or (ii) was nominated for
election or elected to such Board of Directors with the approval of a majority
of the Continuing Directors who were members of such Board at the time of such
nomination or election.
"Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 11.02 hereof or such other address
as to which the Trustee may give notice to the Company.
"Custodian" means the Trustee, as custodian with respect to
the Notes in global form, or any successor entity thereto.
"Default" means any event that is or with the passage of time
or the giving of notice or both would be an Event of Default.
"Definitive Note" means a certificated Note registered in the
name of the Holder thereof and issued in accordance with Section 2.06 hereof, in
the form of Exhibit A hereto except that such Note shall not bear the Global
Note Legend and shall not have the "Schedule of Exchanges of Interests in the
Global Note" attached thereto.
<PAGE> 11
6
"Depositary" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section 2.03
hereof as the Depositary with respect to the Notes, and any and all successors
thereto appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Disqualified Stock" means any Capital Stock that, by its
terms (or by the terms of any security into which it is convertible or for which
it is exchangeable, at the option of the holder thereof), or upon the happening
of any event, matures or is mandatorily redeemable for cash, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the Holder
thereof for cash, in whole or in part, on or prior to the date that is 91 days
after the date on which the Notes mature; provided, however, that any Capital
Stock that would constitute Disqualified Stock solely because the holders
thereof have the right to require the Company to repurchase such Capital Stock
upon the occurrence of a Change of Control or an Asset Sale shall not constitute
Disqualified Stock if the terms of such Capital Stock provide that the Company
may not repurchase or redeem any such Capital Stock pursuant to such provisions
unless such repurchase or redemption complies with Section 4.09.
"Equity Interests" means Capital Stock and all warrants,
options or other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock).
"Equity Offering" means any issuance of common stock by the
Company (excluding Disqualified Stock) that is registered pursuant to the
Securities Act, other than issuances on Form S-8 and issuances registered on
Form S-4.
"Euroclear" means Morgan Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Offer" means the offer that may be made by the
Company pursuant to the Registration Rights Agreement to exchange Series B Notes
for Series A Notes.
"Excluded Properties" means the properties of the Company and
its Restricted Subsidiaries in the following locations: (i) Lawrenceville,
Georgia, (ii) Jacksonville, Florida, (iii) Grand Rapids, Michigan and (iv)
Greenville, Texas.
"Existing Indebtedness" means up to $20,000,000 in aggregate
principal amount of Indebtedness of the Company and its Subsidiaries (other than
Indebtedness under the New Credit Facility and the Notes) in existence on the
date of this Indenture, until such amounts are repaid.
<PAGE> 12
7
"Fixed Charges" means, with respect to any Person for any
period, the sum, without duplication, of (i) the consolidated interest expense
of such Person and its Restricted Subsidiaries for such period, whether paid or
accrued (including, without limitation, amortization of debt issuance costs and
original issue discount, non-cash interest payments, the interest component of
any deferred payment obligations, the interest component of all payments
associated with Capital Lease Obligations, imputed interest with respect to
Attributable Debt, commissions, discounts and other fees and charges incurred in
respect of letter of credit or bankers' acceptance financings, and net payments
(if any) pursuant to Hedging Obligations); provided, that interest expense
counted as a Fixed Charge in one period because it was accrued in such period
shall not be counted in a second period because it was paid in such second
period, and (ii) the consolidated interest expense of such Person and its
Restricted Subsidiaries that was capitalized during such period, and (iii) any
interest expense on Indebtedness of another Person that is Guaranteed by such
Person or one of its Restricted Subsidiaries or secured by a Lien on assets of
such Person or one of its Subsidiaries (whether or not such Guarantee or Lien is
called upon) and (iv) the product of (a) all dividend payments, whether or not
in cash, on any series of preferred stock of such Person or any of its
Restricted Subsidiaries, other than dividend payments on Equity Interests
payable solely in Equity Interests of the Company (other than Disqualified
Stock) or payable to the Company or a Restricted Subsidiary of the Company,
times (b) a fraction, the numerator of which is one and the denominator of which
is one minus the then current combined federal, state and local statutory tax
rate of such Person, expressed as a decimal; in each of the foregoing cases, on
a consolidated basis and in accordance with GAAP.
"Fixed Charge Coverage Ratio" means with respect to any Person
for any period, the ratio of the Consolidated Cash Flow of such Person for such
period to the Fixed Charges of such Person for such period. In the event that
the referrent Person or any of its Restricted Subsidiaries incurs, assumes,
Guarantees or redeems any Indebtedness (other than revolving credit borrowings)
or issues or redeems preferred stock subsequent to the commencement of the
period for which the Fixed Charge Coverage Ratio is being calculated but prior
to the date on which the event for which the calculation of the Fixed Charge
Coverage Ratio is made (the "Calculation Date"), then the Fixed Charge Coverage
Ratio shall be calculated giving pro forma effect to such incurrence,
assumption, Guarantee or redemption of Indebtedness, or such issuance or
redemption of preferred stock, and the application of the proceeds thereof, as
if the same had occurred at the beginning of the applicable four-quarter
reference period. In addition, for purposes of making the computation referred
to above, (i) acquisitions that have been made by the Company or any of its
Restricted Subsidiaries, including through mergers or consolidations and
including any related financing transactions, during the four-quarter reference
period or subsequent to such reference period and on or prior to the Calculation
Date shall be deemed to have occurred on the first day of the four-quarter
reference period and Consolidated Cash Flow for such reference period shall be
calculated without giving effect to clause (iii) of the proviso set forth in the
definition of Consolidated Net Income, and (ii) the Consolidated Cash Flow
attributable
<PAGE> 13
8
to discontinued operations, as determined in accordance with GAAP, and
operations or businesses disposed of prior to the Calculation Date, shall be
excluded, and (iii) the Fixed Charges attributable to discontinued operations,
as determined in accordance with GAAP, and operations or businesses disposed of
prior to the Calculation Date, shall be excluded.
"Foreign Subsidiary" means: (a) the following Wholly Owned
Restricted Subsidiary of Imonics Corporation, a Georgia corporation: Imonics
GmbH, a corporation formed in Germany; (b) the following 50%-Owned Restricted
Subsidiary of Imonics Corporation, a Georgia corporation: Bertelsmann-Imonics
GmbH & Co. Kg, a corporation formed in Germany; (c) the following Wholly Owned
Restricted Subsidiary of BSG Alliance/IT, Inc., a Delaware corporation: SageComm
International, Limited, a corporation formed in the U.K.; (d) the following
Wholly Owned Restricted Subsidiary of Health Data Sciences Corporation: Health
Data Sciences, Ltd., a corporation organized under the laws of Canada; and (e)
every future Restricted Subsidiary of the Company or a Restricted Subsidiary of
the Company that is incorporated in a jurisdiction outside of the United States.
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect from time to time.
"Global Notes" means, individually and collectively, each of
the Restricted Global Notes and the Unrestricted Global Notes, in the form of
Exhibit A hereto issued in accordance with Section 2.01, 2.06(b)(iv),
2.06(d)(ii) or 2.06(f) hereof.
"Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
"Government Securities" means direct obligations of, or
obligations guaranteed by, the United States of America for the payment of which
guarantee or obligations the full faith and credit of the United States is
pledged.
"Guarantee" means, with respect to any Person, a guarantee
(other than by endorsement of negotiable instruments for collection in the
ordinary course of business), direct or indirect, in any manner (including,
without limitation, by way of a pledge of assets or through letters of credit
and reimbursement agreements in respect thereof), of all or any part of any
Indebtedness of any other Person.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) interest rate swap agreements, interest
rate cap agreements and
<PAGE> 14
9
interest rate collar agreements and (ii) other agreements or arrangements
designed to protect such Person against fluctuations in interest rates.
"Holder" means a Person in whose name a Note is registered on
the Registrar's books.
"IAI Global Note" means the global Note in the form of Exhibit
A hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee that shall be issued in a denomination equal to the outstanding
principal amount of the Notes sold to Institutional Accredited Investors.
"Indebtedness" means, with respect to any Person, without
duplication, any indebtedness of such Person, whether or not contingent, for
borrowed money or evidenced by bonds, notes, debentures or similar instruments
or letters of credit (or reimbursement agreements in respect thereof) or
bankers' acceptances or representing Capital Lease Obligations or the balance
deferred and unpaid of the purchase price of any property or representing any
Hedging Obligations, except any such balance that constitutes an accrued expense
or trade payable, if and to the extent any of the foregoing indebtedness (other
than letters of credit and Hedging Obligations) would appear as a liability upon
a balance sheet of such Person prepared in accordance with GAAP, and, to the
extent not otherwise included, all Indebtedness of others secured by a Lien on
any asset of such Person (whether or not such Indebtedness is assumed by such
Person) and, to the extent not otherwise included, the Guarantee by such Person
of any Indebtedness of any other Person if such obligation would be a contingent
obligation that is required to be described in the footnotes to the financial
statements of such Person prepared in accordance with GAAP. The amount of any
Indebtedness outstanding as of any date shall be (i) the accreted value thereof,
in the case of any Indebtedness issued with original issue discount, and (ii)
the principal amount thereof, together with any interest thereon that is more
than 30 days past due, in the case of any other Indebtedness.
"Indenture" means this Indenture, as amended or supplemented
from time to time.
"Initial Purchaser" means Donaldson, Lufkin & Jenrette
Securities Corporation, as the initial purchaser of the Series A Notes.
"Institutional Accredited Investor" means an institution that
is an "accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under
the Securities Act, who are not also QIBs.
<PAGE> 15
10
"Investments" means, with respect to any Person, all
investments by such Person in other Persons (including Affiliates) in the forms
of direct or indirect loans (including guarantees of Indebtedness or other
obligations), advances or capital contributions (excluding commission, travel,
relocation and similar advances to officers and employees made in the ordinary
course of business), purchases or other acquisitions for consideration of
Indebtedness, Equity Interests or other securities of another Person, together
with all items that are or would be classified as investments on a consolidated
balance sheet prepared in accordance with GAAP. If the Company or any Restricted
Subsidiary of the Company sells or otherwise disposes of any Equity Interests of
any direct or indirect Restricted Subsidiary of the Company such that, after
giving effect to any such sale or disposition, such Person is no longer a
Subsidiary of the Company, the Company shall be deemed to have made an
Investment on the date of any such sale or disposition equal to the fair market
value of the Equity Interests of such Subsidiary not sold or disposed of in an
amount determined as provided in the final paragraph of Section 4.09.
Investments shall exclude accounts receivable in the ordinary course of
business, extensions of trade credit on commercially reasonable terms in
accordance with normal trade practices and endorsements of negotiable
instruments.
"Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions in the City of New York or Hartford, Connecticut at a place
of payment are authorized by law, regulation or executive order to remain
closed. If a payment date is a Legal Holiday at a place of payment, payment may
be made at that place on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be
prepared by the Company and sent to all Holders of the Notes for use by such
Holders in connection with the Exchange Offer.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under applicable
law (including any conditional sale or other title retention agreement, any
lease in the nature thereof, and any other agreement to give a security interest
in any asset).
"Liquidated Damages" means all liquidated damages then owing
pursuant to the Registration Rights Agreement.
"Net Income" means, with respect to any Person, the net income
(loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however, (i) any
gain (but not loss), together with any related provision for taxes on such gain
(but not loss), realized in connection with any Asset
<PAGE> 16
11
Sale (including, without limitation, dispositions pursuant to sale and leaseback
transactions) and (ii) any extraordinary or nonrecurring gain or loss, together
with any related provision for taxes on such extraordinary gain or loss.
"Net Proceeds" means the aggregate cash proceeds received by
the Company or any of its Restricted Subsidiaries in respect of any sale or
other disposition of assets (including, without limitation, any cash received
upon the sale or other disposition of any non-cash consideration received in any
sale or other disposition of assets) or the issuance of Equity Interests of
Subsidiaries or the Company, net of the direct costs relating to such Asset Sale
or issuance of Equity Interests (including, without limitation, legal,
accounting and investment banking fees, and sales commissions) and any
relocation expenses incurred as a result thereof, estimated taxes paid or
payable as a result thereof, amounts required to be applied to the repayment of
Indebtedness secured by a Lien on the asset or assets that were the subject of
such Asset Sale and any reserve for adjustment in respect of the sale price of
such asset or assets established in accordance with GAAP.
"New Credit Facility" means that certain Credit Agreement,
dated as of January 13, 1998, by and among the Company, the lenders and agents
party thereto and DLJ Capital Funding, Inc., as syndication agent, including any
related notes, guarantees, collateral documents, instruments and agreements from
time to time executed in connection therewith, and in each case as amended,
amended and restated, modified, renewed, refunded, replaced or refinanced from
time to time in whole or in part (including with the same or different agents,
lenders or borrowers).
"Non-Recourse Debt" means Indebtedness or Disqualified Stock
(i) as to which neither the Company nor any of its Restricted Subsidiaries (a)
provides credit support of any kind (including any undertaking, agreement or
instrument that would constitute Indebtedness), or (b) is directly or indirectly
liable (as a guarantor or otherwise); and (ii) as to which the lenders or their
respective representatives have been notified in writing that they shall not
have any recourse to the stock or assets of the Company or any of its Restricted
Subsidiaries.
"Note Custodian" means the Trustee, as custodian with respect
to the Global Notes, or any successor entity thereto.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering" means the Offering of the Notes by the Company.
<PAGE> 17
12
"Officer" means, with respect to any Person, the Chairman of
the Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, the Treasurer, the Controller, the
Secretary or any Executive Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf
of the Company by two Officers of the Company, one of whom must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of the Company, that meets the requirements of
Section 11.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who
is reasonably acceptable to the Trustee, that meets the requirements of Section
11.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
"Participant" means, with respect to the Depositary, Euroclear
or Cedel, a Person who has an account with the Depositary, Euroclear or Cedel,
respectively (and, with respect to The Depository Trust Company, shall include
Euroclear and Cedel).
"Permitted Investments" means (a) any Investments in the
Company or in any Subsidiary Guarantor or Wholly Owned Restricted Subsidiary
that is engaged in the same or a related or complementary line of business as
the Company and its Subsidiaries were engaged in on the date of this Indenture
(as determined in good faith by the Company); (b) any Investments in Cash
Equivalents; (c) any Investments by the Company or any Restricted Subsidiary of
the Company in a Person, if as a result of such Investments (i) such Person
becomes a Wholly Owned Restricted Subsidiary of the Company or a Subsidiary
Guarantor that is engaged in the same or a related or complementary line of
business as the Company and its Restricted Subsidiaries were engaged in on the
date of this Indenture (as determined in good faith by the Company) or (ii) such
Person is merged, consolidated or amalgamated with or into, or transfers or
conveys substantially all of its assets to, or is liquidated into, the Company
or a Wholly Owned Restricted Subsidiary of the Company or a Subsidiary Guarantor
and that is engaged in the same or a related or complementary line of business
as the Company and its Subsidiaries were engaged in on the date of this
Indenture (as determined in good faith by the Company); (d) any Investment made
as a result of the receipt of non-cash consideration from an Asset Sale that was
made pursuant to and in compliance with Section 4.08; (e) any acquisition of
assets solely in exchange for the issuance of Equity Interests (other than
Disqualified Stock) of the Company; (f) Hedging Obligations and Guarantees
permitted to be incurred under Section 4.10; (g) Investments resulting from
advances made to customers in the ordinary course of business, or acquired in
satisfaction of such advances or otherwise as a result of a customer's
bankruptcy; (h) aggregate Investments not to exceed $10,000,000 by the Company
or a Subsidiary Guarantor in (1) any joint venture that is engaged in the same
or a related or complementary line of business as the Company and its
<PAGE> 18
13
Subsidiaries were engaged in on the date of this Indenture (as determined in
good faith by the Company) or (2) a Receivables Subsidiary; provided, that the
foregoing Investment in a Receivables Subsidiary is in the form of a note that
the Receivables Subsidiary is required to repay as soon as practicable from
available cash collections less amounts required to be established as reserves
pursuant to contractual agreements with entities that are not Affiliates of the
Company entered into as part of a Qualified Receivables Transaction; (i) loans
or advances, to the extent made with cash in an aggregate principal amount not
to exceed $5,000,000 at any one time outstanding, to employees of the Company or
Restricted Subsidiaries to permit such employees to purchase stock or stock
options pursuant to employee benefit plans or similar plans or agreements; and
(j) other Investments in any Person having an aggregate fair market value
(measured on the date each such Investment was made and without giving effect to
subsequent changes in value), when taken together with all other Investments
made pursuant to this clause (j) that are at the time outstanding, not to exceed
$10,000,000.
"Permitted Liens" means (i) Liens on assets of the Company
securing Indebtedness under the New Credit Facility that was permitted by the
terms of this Indenture to be incurred and Liens on assets of Restricted
Subsidiaries securing Guarantees of Indebtedness under the New Credit Facility
permitted by this Indenture to be incurred; (ii) Liens in favor of the Company
or any Wholly Owned Restricted Subsidiary or any Subsidiary Guarantor; (iii)
Liens on property of a Person existing at the time such Person is merged into or
consolidated with the Company or any Restricted Subsidiary of the Company or
becomes a Restricted Subsidiary as a result of the acquisition of Equity
Interests of such Person; provided that such Liens were not incurred in
contemplation of such acquisition, merger or consolidation and do not extend to
any assets other than those of the Person acquired, merged into or consolidated
with the Company or a Restricted Subsidiary; (iv) Liens on property existing at
the time of acquisition thereof by the Company or any Restricted Subsidiary of
the Company, provided that such Liens were not incurred in contemplation of such
acquisition; (v) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds, leases, contracts (other than
contracts in respect of borrowed money and other Indebtedness), reimbursement
obligations in respect of letters of credit or bankers acceptances or other
obligations of a like nature, in each case incurred in the ordinary course of
business; (vi) Liens to secure Indebtedness represented by Capital Lease
Obligations, mortgage financings or purchase money obligations incurred pursuant
to subsection (ix) of the second paragraph of Section 4.10; provided that (a)
any such Lien attached to the property concurrently with or within 90 days after
the acquisition thereof or the execution of the Capital Lease with respect
thereto, (b) such Lien attaches solely to the property so acquired in such
transaction or to property subject to such Capital Lease, and (c) the principal
amount of the Indebtedness secured thereby does not exceed 100% of the cost of
such property; (vii) Liens existing on the date of this Indenture; (viii) Liens
for taxes, assessments or governmental charges or claims that are not yet
delinquent or that are being contested in good faith by appropriate proceedings
diligently pursued, provided that any reserve or other
<PAGE> 19
14
appropriate provision as shall be required in conformity with GAAP shall have
been made therefor; (ix) Liens on assets of a Receivables Subsidiary incurred in
connection with a Qualified Receivables Transaction; (x) Liens arising out of
transactions permitted under Section 4.14; provided that such Lien attaches only
to to the property subject to lease entered in connection with such transaction;
(xi) Liens securing Permitted Refinancing Indebtedness; provided, that such Lien
attaches only to the assets that secured the Indebtedness being refinanced; and
(xii) Liens with respect to obligations that do not exceed $10,000,000 at any
one time outstanding.
"Permitted Refinancing Indebtedness" means any Indebtedness of
the Company or any of its Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Company or any of its Subsidiaries (other than
intercompany Indebtedness); provided that: (i) the principal amount (or accreted
value, if applicable) of such Permitted Refinancing Indebtedness does not exceed
the principal amount of (or accreted value, if applicable), plus accrued
interest on, the Indebtedness so extended, refinanced, renewed, replaced,
defeased or refunded (plus the amount of premiums, if any, paid and reasonable
expenses incurred in connection therewith); (ii) such Permitted Refinancing
Indebtedness has a final maturity date later than the final maturity date of,
and has a Weighted Average Life to Maturity equal to or greater than the
Weighted Average Life to Maturity of, the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded; (iii) if the Indebtedness
being extended, refinanced, renewed, replaced, defeased or refunded is
subordinated in right of payment to the Notes, such Permitted Refinancing
Indebtedness has a final maturity date later than the final maturity date of,
and is subordinated in right of payment to, the Notes on terms at least as
favorable in all material respects to the Holders of Notes as those contained in
the documentation governing the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; and (iv) such Indebtedness is incurred
either by the Company or by a Restricted Subsidiary who is an obligor on the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded, except that the Company may incur Permitted Refinancing Indebtedness
to extend, refinance, renew, replace, defease or refund, Indebtedness of any
Wholly Owned Restricted Subsidiary of the Company or any Subsidiary Guarantor.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization, government or any agency or political
subdivision thereof or any other entity.
"preferred stock" means any Equity Interests with preferential
right of payment of dividends or upon liquidation, dissolution, or winding up.
<PAGE> 20
15
"Private Placement Legend" means the legend set forth in
Section 2.06(g)(i) to be placed on all Notes issued under this Indenture except
where otherwise permitted by the provisions of this Indenture.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Qualified Insurance Payments" means payments made by a third
party insurance company pursuant to an insurance policy entered into by the
Company or any of its Restricted Subsidiaries in the ordinary course of
business, directly to, or for the benefit of, holders of Equity Interests of the
Company or its Restricted Subsidiaries, less any reimbursement payments or
additional contributions required from the Company or its Restricted
Subsidiaries in connection with such payments (other than ordinary premiums).
"Qualified Receivables Transaction" means any transaction or
series of transactions pursuant to which the Company or any of its Subsidiary
Guarantors, or any of their respective customers, may sell, convey or otherwise
transfer to a Receivables Subsidiary, or may grant a security interest in, any
accounts receivable (whether now existing or arising in the future) of the
Company or any of its Subsidiary Guarantors, and any assets related thereto
including, without limitation, all collateral securing such accounts receivable,
all contracts and all guarantees or other obligations in respect of such
accounts receivable, proceeds of such accounts receivable and other assets which
are customarily transferred or in respect of which security interests are
customarily granted in connection with asset securitization transactions
involving accounts receivable.
"Receivables Subsidiary" means an Unrestricted Subsidiary of
the Company which engages in no activities other than in connection with a
Qualified Receivables Transaction and which is designated by the Board of
Directors of the Company (as provided below) as a Receivables Subsidiary and
with which neither the Company nor any Restricted Subsidiary of the Company has
any material contract, agreement, arrangement or understanding other than on
terms no less favorable to the Company or such Restricted Subsidiary than those
that might be obtained at the time from persons who are not Affiliates of the
Company, other than fees payable in the ordinary course of business in
connection with servicing accounts receivable and with which neither the Company
nor any Subsidiary of the Company has any obligation to maintain or preserve
such Subsidiary's financial condition or cause such Subsidiary to achieve
certain levels of operating results. Any such designation by the Board of
Directors of the Company shall be evidenced to the Trustee by filing with the
Trustee a certified copy of the resolution of the Board of Directors of the
Company giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing conditions.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the date of this Indenture, by and among the Company, the
Subsidiary Guarantors
<PAGE> 21
16
and the Initial Purchaser, as such agreement may be amended, modified or
supplemented from time to time.
"Regulation S" means Regulation S promulgated under the
Securities Act.
"Regulation S Global Note" means a Regulation S Temporary
Global Note or Regulation S Permanent Global Note, as appropriate.
"Regulation S Permanent Global Note" means a permanent global
Note in the form of Exhibit A-1 hereto bearing the Global Note Legend and the
Private Placement Legend and deposited with or on behalf of and registered in
the name of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period.
"Regulation S Temporary Global Note" means a temporary global
Note in the form of Exhibit A-2 hereto bearing the Private Placement Legend and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee, issued in a denomination equal to the outstanding principal amount
of the Notes initially sold in reliance on Rule 903 of Regulation S.
"Restricted Broker-Dealer" has the meaning set forth in the
Registration Rights Agreement.
"Restricted Definitive Note" means a Definitive Note bearing
the Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the
Private Placement Legend.
"Restricted Investment" means an Investment other than a
Permitted Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of
the referent Person that is not then an Unrestricted Subsidiary.
"Rule 144A" means Rule 144A promulgated under the Securities
Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
<PAGE> 22
17
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Exchange Act, as such Regulation is in effect on the
date hereof.
"Stated Maturity" means, with respect to any installment of
interest or principal on any series of Indebtedness, the date on which such
payment of interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and shall not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior
to the date originally scheduled for the payment thereof.
"Subordinated Indebtedness" means (a) with respect to the
Notes, any Indebtedness of the Company which is by its terms expressly
subordinated in right of payment to the Notes and (b) with respect to any
Subsidiary Guarantee, any Indebtedness of the applicable Subsidiary Guarantor
which by its term is subordinated in right of payment to such Subsidiary
Guarantee.
"Subsidiary" means, with respect to any Person, (i) any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
such Person or one or more of the other Subsidiaries of that Person (or a
combination thereof) and (ii) any partnership (a) the sole general partner or
the managing general partner of which is such Person or a Subsidiary of such
Person or (b) the only general partners of which are such Person or of one or
more Subsidiaries of such Person (or any combination thereof). A Subsidiary of
the Company shall, at any time, be either a Restricted Subsidiary or an
Unrestricted Subsidiary, but not both.
"Subsidiary Guarantors" means, so long as the same are
Subsidiaries of the Company, (a) each of the following Restricted Subsidiaries
of the Company: Medaphis Physician Services Corporation, a Georgia corporation;
Gottlieb's Financial Services, Inc., a Georgia corporation; Medical Management
Sciences, Inc., a Maryland corporation; Medaphis Services Corporation, a Georgia
corporation; Medaphis Healthcare Information Technology Company, a Georgia
corporation; Automation Atwork, a California corporation; Consort Technologies,
Inc., a Georgia corporation; Health Data Sciences Corporation, a Delaware
corporation; BSG Corporation, a Delaware corporation; (b) the following
Restricted Subsidiaries of Medaphis Services Corporation, a Georgia corporation:
AssetCare, Inc., a Georgia corporation; National Healthcare Technologies, Inc.,
an Indiana corporation; (c) the following Restricted Subsidiaries of BSG
Corporation, a Delaware corporation: BSG Alliance/IT, Inc., a Delaware
corporation; and BSG Government Solutions, Inc., a Maryland corporation; and (d)
any other Subsidiary that executes a Subsidiary Guarantee in accordance with the
provisions of this Indenture, and their respective successors and assigns until
released.
<PAGE> 23
18
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date on which this Indenture is
qualified under the TIA.
"Transfer Restricted Notes" means securities that bear, or
that are required to bear, the Private Placement Legend.
"Trustee" means the party named as such above until a
successor replaces it in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder.
"Unrestricted Definitive Note" means one or more Definitive
Notes that do not bear and are not required to bear the Private Placement
Legend.
"Unrestricted Global Note" means a permanent global Note in
the form of Exhibit A attached hereto that bears the Global Note Legend and that
has the "Schedule of Exchanges of Interests in the Global Note" attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"Unrestricted Subsidiary" means (i) any Subsidiary (other than
the Subsidiary Guarantors as of the date of this Indenture or any successor to
any of them) that is designated by the Board of Directors as an Unrestricted
Subsidiary pursuant to a Board Resolution; but only to the extent that such
Subsidiary: (a) has no Indebtedness other than Non-Recourse Debt; (b) is not
party to any agreement, contract, arrangement or understanding with the Company
or any Restricted Subsidiary of the Company unless the terms of any such
agreement, contract, arrangement or understanding are no less favorable in any
material respect to the Company or such Restricted Subsidiary than those that
would have been obtained in a comparable transaction by the Company or such
Restricted Subsidiary with Persons who are not Affiliates of the Company; (c) is
a Person with respect to which neither the Company nor any of its Restricted
Subsidiaries has any direct or indirect obligation (x) to subscribe for
additional Equity Interests or (y) to maintain or preserve such Person's
financial condition or to cause such Person to achieve any specified levels of
operating results; and (d) has not guaranteed or otherwise directly or
indirectly provided credit support for any Indebtedness of the Company or any of
its Restricted Subsidiaries (other than as a result of a Permitted Lien on
outstanding Equity Interests of such Person). Any such designation by the Board
of Directors shall be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution giving effect to such designation and an
Officers' Certificate certifying that such designation complied with the
foregoing conditions and was permitted by Section 4.09. If, at any time, any
Unrestricted Subsidiary would fail to meet the foregoing requirements as an
Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of such
Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the
Company as of
<PAGE> 24
19
such date (and, if such Indebtedness is not permitted to be incurred as of such
date under Section 4.10, the Company shall be in default of such covenant). The
Board of Directors of the Company may at any time designate any Unrestricted
Subsidiary to be a Restricted Subsidiary; provided that such designation shall
be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of the
Company of any outstanding Indebtedness of such Unrestricted Subsidiary and such
designation shall only be permitted if (i) such Indebtedness is permitted under
Section 4.10, calculated on a pro forma basis as if such designation had
occurred at the beginning of the four-quarter reference period, and (ii) no
Default or Event of Default would be in existence following such designation.
"U.S. Person" means a U.S. person as defined in Rule 902(o)
under the Securities Act.
"Voting Stock" of any Person as of any date means the
outstanding Capital Stock of such Person that is at the time entitled to vote in
the election of the Board of Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that shall elapse
between such date and the making of such payment, by (ii) the then outstanding
principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than directors' qualifying shares)
shall at the time be owned by such Person or by one or more Wholly Owned
Restricted Subsidiaries of such Person and one or more Wholly Owned Restricted
Subsidiaries of such Person.
SECTION 1.02 OTHER DEFINITIONS
<TABLE>
<CAPTION>
Defined in
Term Section
---- -------
<S> <C>
"Affiliate Transaction" 4.13
"Asset Sale Offer" 4.08
"Asset Sale Offer Period" 4.08
"Asset Sale Offer Amount" 4.08
"Asset Sale Offer Trigger Date" 4.08
"Asset Sale Purchase Date" 4.08
</TABLE>
<PAGE> 25
20
<TABLE>
<S> <C>
"Authentication Order" 2.02
"Available Amount" 4.08
"Bankruptcy Law" 6.01
"Benefitted Party" 10.01
"Change of Control Offer" 4.07
"Change of Control Offer Period" 4.07
"Change of Control Payment" 4.07
"Change of Control Purchase Date" 4.07
"Company Obligations" 4.01
"Covenant Defeasance" 8.03
"Custodian" 6.01
"DTC" 2.03
"Excess Proceeds" 4.08
"Guarantee Obligations" 10.01
"Legal Defeasance" 8.02
"Paying Agent" 2.03
"Payment Default" 6.01
"Registrar" 2.03
"Restricted Payments" 4.09
</TABLE>
SECTION 1.03 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the
following meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee;
"obligor" on the Notes means the Company and any successor
obligor upon the Notes.
<PAGE> 26
21
All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule under
the TIA have the meanings so assigned to them.
SECTION 1.04 RULES OF CONSTRUCTION
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the
plural include the singular;
(5) provisions apply to successive events and
transactions; and
(6) references to sections of or rules under the
Securities Act shall be deemed to include substitute, replacement of
successor sections or rules adopted by the SEC from time to time.
ARTICLE 2
THE NOTES
SECTION 2.01 FORM AND DATING
(a) General. The Notes and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A hereto. The Notes
may have notations, legends or endorsements required by law, stock exchange rule
or usage. Each Note shall be dated the date of its authentication. The Notes
shall be in denominations of $1,000 and integral multiples thereof
The terms and provisions contained in the Notes shall
constitute, and are hereby expressly made, a part of this Indenture and the
Company, the Subsidiary Guarantors and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and provisions and to
be bound thereby. However, to the extent any provision of any Note conflicts
with the express provisions of this Indenture, the provisions of this Indenture
shall govern and be controlling.
<PAGE> 27
22
(b) Global Notes. Notes issued in global form shall be
substantially in the form of Exhibit A-1 or A-2 attached hereto (including the
Global Note Legend thereon and the "Schedule of Exchanges of Interests in the
Global Note" attached thereto). Notes issued in definitive form shall be
substantially in the form of Exhibit A attached hereto (but without the Global
Note Legend thereon and without the "Schedule of Exchanges of Interests in the
Global Note" attached thereto). Each Global Note shall represent such of the
outstanding Notes as shall be specified therein and each shall provide that it
shall represent the aggregate principal amount of outstanding Notes from time to
time endorsed thereon and that the aggregate principal amount of outstanding
Notes represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. Any endorsement of a Global
Note to reflect the amount of any increase or decrease in the aggregate
principal amount of outstanding Notes represented thereby shall be made by the
Trustee or the Note Custodian, at the direction of the Trustee, in accordance
with instructions given by the Holder thereof as required by Section 2.06
hereof.
(c) Temporary Global Notes. Notes offered and sold in reliance
on Regulation S shall be issued initially in the form of the Regulation S
Temporary Global Note, which shall be deposited on behalf of the purchasers of
the Notes represented thereby with the Trustee, at its New York office, as
custodian for the Depositary, and registered in the name of the Depositary or
the nominee of the Depositary for the accounts of designated agents holding on
behalf of Euroclear or Cedel Bank, duly executed by the Company and, upon
receipt by the Trustee of an Authentication Order, authenticated by the Trustee
as hereinafter provided. The Restricted Period shall be terminated upon the
receipt by the Trustee of (i) a written certificate from the Depositary,
together with copies of certificates from Euroclear and Cedel Bank certifying
that they have received certification of non-United States beneficial ownership
of 100% of the aggregate principal amount of the Regulation S Temporary Global
Note (except to the extent of any beneficial owners thereof who acquired an
interest therein during the Restricted Period pursuant to another exemption from
registration under the Securities Act and who will take delivery of a beneficial
ownership interest in a 144A Global Note or an IAI Global Note bearing a Private
Placement Legend), and (ii) an Officers' Certificate from the Company. Following
the termination of the Restricted Period, beneficial interests in the Regulation
S Temporary Global Note shall be exchanged for beneficial interests in
Regulation S Permanent Global Notes pursuant to the Applicable Procedures.
Simultaneously with the authentication of Regulation S Permanent Global Notes,
the Trustee shall cancel the Regulation S Temporary Global Note. The aggregate
principal amount of the Regulation S Temporary Global Note and the Regulation S
Permanent Global Notes may from time to time be increased or decreased by
adjustments made on the records of the Trustee and the Depositary or its
nominee, as the case may be, in connection with transfers of interest as
hereinafter provided.
(d) Euroclear and Cedel Procedures Applicable. The provisions
of the "Operating Procedures of the Euroclear System" and "Terms and Conditions
Governing Use
<PAGE> 28
23
of Euroclear" and the "General Terms and Conditions of Cedel Bank" and "Customer
Handbook" of Cedel Bank shall be applicable to transfers of beneficial interests
in the Regulation S Temporary Global Note and the Regulation S Permanent Global
Notes that are held by Participants through Euroclear or Cedel Bank.
SECTION 2.02 EXECUTION AND AUTHENTICATION
Two Officers shall sign the Notes for the Company by manual or
facsimile signature. The Company's seal shall be reproduced on the Notes and may
be in facsimile form. If an Officer whose signature is on a Note no longer holds
that office at the time a Note is authenticated, the Note shall nevertheless be
valid. A Note shall not be valid until authenticated by the manual signature of
the Trustee. The signature shall be conclusive evidence that the Note has been
authenticated under this Indenture. The Trustee shall, upon a written order of
the Company signed by two Officers (an "Authentication Order"), authenticate
Notes for original issue up to the aggregate principal amount stated in
paragraph 4 of the Notes. The aggregate principal amount of Notes outstanding at
any time may not exceed such amount except as provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to the Company to
authenticate Notes. An authenticating agent may authenticate Notes whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with Holders or an Affiliate of the Company.
SECTION 2.03 REGISTRAR AND PAYING AGENT
The Company shall maintain an office or agency where Notes may
be presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Company may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company shall notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.The Company initially
appoints The Depository Trust Company ("DTC") to act as Depositary with respect
to the Global Notes.The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Note Custodian with respect to the
Global Notes.
<PAGE> 29
24
SECTION 2.04 PAYING AGENT TO HOLD MONEY IN TRUST
The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
payment of principal, premium or Liquidated Damages, if any, or interest on the
Notes, and shall notify the Trustee of any default by the Company in making any
such payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee. Upon payment
over to the Trustee, the Paying Agent (if other than the Company or a
Subsidiary) shall have no further liability for the money. If the Company or a
Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust
fund for the benefit of the Holders all money held by it as Paying Agent. Upon
any bankruptcy or reorganization proceedings relating to the Company, the
Trustee shall serve as Paying Agent for the Notes.
SECTION 2.05 HOLDER LISTS
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of all Holders and shall otherwise comply with TIA Section 312(a). If
the Trustee is not the Registrar, the Company shall furnish to the Trustee at
least seven Business Days before each interest payment date and at such other
times as the Trustee may request in writing, a list in such form and as of such
date as the Trustee may reasonably require of the names and addresses of the
Holders of Notes and the Company shall otherwise comply with TIA Section 312(a).
SECTION 2.06 TRANSFER AND EXCHANGE
(a) Transfer and Exchange of Global Notes. A Global Note may
not be transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to another
nominee of the Depositary, or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary. All Global Notes
shall be exchanged by the Company for Definitive Notes if (i) the Company
delivers to the Trustee notice from the Depositary that it is unwilling or
unable to continue to act as Depositary or that it is no longer a clearing
agency registered under the Exchange Act and, in either case, a successor
Depositary is not appointed by the Company within 120 days after the date of
such notice from the Depositary or (ii) the Company in its sole discretion
determines that the Global Notes (in whole but not in part) should be exchanged
for Definitive Notes and delivers a written notice to such effect to the
Trustee; provided that in no event shall the Regulation S Temporary Global Note
be exchanged by the Company for Definitive Notes prior to (x) the expiration of
the Restricted Period and (y) the receipt by the Registrar of any certificates
required pursuant to Rule 903(c)(3)(ii)(B) under the Securities Act. Upon the
occurrence of either of the preceding events in (i) or (ii) above,
<PAGE> 30
25
Definitive Notes shall be issued in such names as the Depositary shall instruct
the Trustee. Global Notes also may be exchanged or replaced, in whole or in
part, as provided in Sections 2.07 and 2.10 hereof. Every Note authenticated and
delivered in exchange for, or in lieu of, a Global Note or any portion thereof,
pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof, shall be
authenticated and delivered in the form of, and shall be, a Global Note. A
Global Note may not be exchanged for another Note other than as provided in this
Section 2.06(a), however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.06(b),(c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the
Global Notes. The transfer and exchange of beneficial interests in the Global
Notes shall be effected through the Depositary, in accordance with the
provisions of this Indenture and the Applicable Procedures. Beneficial interests
in the Restricted Global Notes shall be subject to restrictions on transfer
comparable to those set forth herein to the extent required by the Securities
Act. Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well as
one or more of the other following subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same
Global Note. Beneficial interests in any Restricted Global Note may be
transferred to Persons who take delivery thereof in the form of a beneficial
interest in the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend; provided, however, that
prior to the expiration of the Restricted Period, transfers of beneficial
interests in the Regulation S Temporary Global Note may not be made to a U.S.
Person or for the account or benefit of a U.S. Person (other than the Initial
Purchaser). Beneficial interests in any Unrestricted Global Note may be
transferred to Persons who take delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note. No written orders or instructions shall
be required to be delivered to the Registrar to effect the transfers described
in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial
Interests in Global Notes. In connection with all transfers and exchanges of
beneficial interests that are not subject to Section 2.06(b)(i) above, the
transferor of such beneficial interest must deliver to the Registrar either (A)
(1) a written order from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing the Depositary
to credit or cause to be credited a beneficial interest in another Global Note
in an amount equal to the beneficial interest to be transferred or exchanged and
(2) instructions given in accordance with the Applicable Procedures containing
information regarding the Participant account to be credited with such increase
or (B) (1) a written order from a Participant or an Indirect Participant given
to the Depositary in accordance with the Applicable Procedures directing the
Depositary to cause to be issued a Definitive Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2) instructions
<PAGE> 31
26
given by the Depositary to the Registrar containing information regarding the
Person in whose name such Definitive Note shall be registered to effect the
transfer or exchange referred to in (B)(1) above; provided that in no event
shall Definitive Notes be issued upon the transfer or exchange of beneficial
interests in the Regulation S Temporary Global Note prior to (x) the expiration
of the Restricted Period and (y) the receipt by the Registrar of any
certificates required pursuant to Rule 903 under the Securities Act. Upon
consummation of an Exchange Offer by the Company in accordance with Section
2.06(f) hereof, the requirements of this Section 2.06(b)(ii) shall be deemed to
have been satisfied upon receipt by the Registrar of the instructions contained
in the Letter of Transmittal delivered by the Holder of such beneficial
interests in the Restricted Global Notes. Upon satisfaction of all of the
requirements for transfer or exchange of beneficial interests in Global Notes
contained in this Indenture and the Notes or otherwise applicable under the
Securities Act, the Trustee shall adjust the principal amount of the relevant
Global Note(s) pursuant to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests to Another
Restricted Global Note. A beneficial interest in any Restricted Global Note may
be transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer complies
with the requirements of Section 2.06(b)(ii) above and the Registrar receives
the following:
(A) if the transferee shall take delivery in
the form of a beneficial interest in the 144A Global Note, then the
transferor must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (1) thereof;
(B) if the transferee will take delivery in
the form of a beneficial interest in the Regulation S Temporary Global
Note, then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (2) thereof; and
(C) if the transferee will take delivery in
the form of a beneficial interest in the IAI Global Note, then the
transferor must deliver a certificate in the form of Exhibit B hereto,
including the certifications and certificates and Opinion of Counsel
required by item (3) thereof, if applicable.
(iv) Transfer and Exchange of Beneficial Interests
in a Restricted Global Note for Beneficial Interests in the Unrestricted Global
Note. A beneficial interest in any Restricted Global Note may be exchanged by
any holder thereof for a beneficial interest in an Unrestricted Global Note or
transferred to a Person who takes delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note if the exchange or transfer complies
with the requirements of Section 2.06(b)(ii) above and:
<PAGE> 32
27
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the Registration
Rights Agreement and the holder of the beneficial interest to be
transferred, in the case of an exchange, or the transferee, in the case
of a transfer, certifies in the applicable Letter of Transmittal that
it is not (1) a broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is an affiliate
(as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to
the Shelf Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a
Restricted Broker- Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a Restricted Global
Note proposes to exchange such beneficial interest for a beneficial
interest in an Unrestricted Global Note, a certificate from such holder
in the form of Exhibit C hereto, including the certifications in item
(1)(a) thereof; or (2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial interest to
a Person who shall take delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note, a certificate from such holder
in the form of Exhibit B hereto, including the certifications in item
(4) thereof; and, in each such case set forth in this subparagraph (D),
if the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in compliance
with the Securities Act and that the restrictions on transfer contained
herein and in the Private Placement Legend are no longer required in
order to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B)
or (D) above at a time when an Unrestricted Global Note has not yet been issued,
the Company shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.Beneficial interests in an Unrestricted Global
Note cannot be exchanged for, or transferred to Persons who take delivery
thereof in the form of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for
Definitive Notes.
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28
(i) Beneficial Interests in Restricted Global Notes
to Restricted Definitive Notes. If any holder of a beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note or to transfer such beneficial interest to a Person
who takes delivery thereof in the form of a Restricted Definitive Note, then,
upon receipt by the Registrar of the following documentation:
(A) if the holder of such beneficial
interest in a Restricted Global Note proposes to exchange such
beneficial interest for a Restricted Definitive Note, a certificate
from such holder in the form of Exhibit C hereto, including the
certifications in item (2)(a) thereof;
(B) if such beneficial interest is being
transferred to a QIB in accordance with Rule 144A under the Securities
Act, a certificate to th e effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
(C) if such beneficial interest is being
transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904 under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such beneficial interest is being
transferred pursuant to an exemption from the registration requirements
of the Securities Act in accordance with Rule 144 under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(a) thereof;
(E) if such beneficial interest is being
transferred to an Institutional Accredited Investor in reliance on an
exemption from the registration requirements of the Securities Act
other than those listed in subparagraphs (B) through (D) above, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required by item
(3) thereof, if applicable;
(F) if such beneficial interest is being
transferred to the Company or any of its Subsidiaries, a certificate to
the effect set forth in Exhibit B hereto, including the certifications
in item (3)(b) thereof; or
(G) if such beneficial interest is being
transferred pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable
Restricted Global Note to be reduced accordingly pursuant to Section 2.06(h)
hereof, and the Company shall
<PAGE> 34
29
execute and, upon receipt of an Authentication Order pursuant to Section 2.02,
the Trustee shall authenticate and deliver to the Person designated in the
instructions a Definitive Note in the appropriate principal amount. Any
Restricted Definitive Note issued in exchange for a beneficial interest in a
Restricted Global Note pursuant to this Section 2.06(c) shall be registered in
such name or names and in such authorized denomination or denominations as the
holder of such beneficial interest shall instruct the Registrar through
instructions from the Depositary and the Participant or Indirect Participant.
The Trustee shall deliver such Restricted Definitive Notes to the Persons in
whose names such Notes are so registered. Any Restricted Definitive Note issued
in exchange for a beneficial interest in a Restricted Global Note pursuant to
this Section 2.06(c)(i) shall bear the Private Placement Legend and shall be
subject to all restrictions on transfer contained therein.
(ii) Notwithstanding Sections 2.06(c)(i)(A) and (C)
hereof, a beneficial interest in the Regulation S Temporary Global Note may not
be exchanged for a Definitive Note or transferred to a Person who takes delivery
thereof in the form of a Definitive Note prior to (x) the expiration of the
Restricted Period and (y) the receipt by the Registrar of any certificates
required pursuant to Rule 903(c)(3)(ii)(B) under the Securities Act, except in
the case of a transfer pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 903 or Rule 904.
(iii) Beneficial Interests in Restricted Global Notes
to Unrestricted Definitive Notes. A holder of a beneficial interest in a
Restricted Global Note may exchange such beneficial interest for an Unrestricted
Definitive Note or may transfer such beneficial interest to a Person who takes
delivery thereof in the form of an Unrestricted Definitive Note only if:
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the Registration
Rights Agreement and the holder of such beneficial interest, in the
case of an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution of the
Exchange Notes or (3) a Person who is an affiliate (as defined in Rule
144) of the Company;
(B) such transfer is effected pursuant to
the Shelf Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a
Restricted Broker- Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a Restricted Global
Note proposes to exchange such
<PAGE> 35
30
beneficial interest for a Definitive Note that does not bear the
Private Placement Legend, a certificate from such holder in the form of
Exhibit C hereto, including the certifications in item (1)(b) thereof;
or (2) if the holder of such beneficial interest in a Restricted Global
Note proposes to transfer such beneficial interest to a Person who
shall take delivery thereof in the form of a Definitive Note that does
not bear the Private Placement Legend, a certificate from such holder
in the form of Exhibit B hereto, including the certifications in item
(4) thereof; and, in each such case set forth in this subparagraph (D),
if the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in compliance
with the Securities Act and that the restrictions on transfer contained
herein and in the Private Placement Legend are no longer required in
order to maintain compliance with the Securities Act.
(iv) Beneficial Interests in Unrestricted Global
Notes to Unrestricted Definitive Notes. If any holder of a beneficial interest
in an Unrestricted Global Note proposes to exchange such beneficial interest for
an Unrestricted Definitive Note or to transfer such beneficial interest to a
Person who takes delivery thereof in the form of an Unrestricted Definitive
Note, then, upon satisfaction of the conditions set forth in Section 2.06(b)(ii)
hereof, the Trustee shall cause the aggregate principal amount of the applicable
Unrestricted Global Note to be reduced accordingly pursuant to Section 2.06(h)
hereof, and the Company shall execute and, upon receipt of an Authentication
Order pursuant to Section 2.02, the Trustee shall authenticate and deliver to
the Person designated in the instructions an Unrestricted Definitive Note in the
appropriate principal amount. Any Unrestricted Definitive Note issued in
exchange for a beneficial interest pursuant to this Section 2.06(c)(iii) shall
be registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Unrestricted Definitive
Notes to the Persons in whose names such Notes are so registered. Any
Unrestricted Definitive Note issued in exchange for a beneficial interest
pursuant to this Section 2.06(c)(iii) shall not bear the Private Placement
Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(i) Restricted Definitive Notes to Beneficial
Interests in Restricted Global Notes. If any Holder of a Restricted Definitive
Note proposes to exchange such Note for a beneficial interest in a Restricted
Global Note or to transfer such Restricted Definitive Notes to a Person who
takes delivery thereof in the form of a beneficial interest in a Restricted
Global Note, then, upon receipt by the Registrar of the following documentation:
(A) if the Holder of such Restricted
Definitive Note proposes to exchange such Note for a beneficial
interest in a Restricted Global Note,
<PAGE> 36
31
a certificate from such Holder in the form of Exhibit C hereto,
including the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Note is
being transferred to a QIB in accordance with Rule 144A under the
Securities Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (1) thereof;
(C) if such Restricted Definitive Note is
being transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904 under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such Restricted Definitive Note is
being transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule 144 under
the Securities Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is
being transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof;
(F) if such Restricted Definitive Note is
being transferred pursuant to an effective registration statement under
the Securities Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(c) thereof; or
(G) if such Restricted Definitive Note is
being transferred to an Institutional Accredited Investor in reliance
on an exemption from the registration requirements of the Securities
Act other than those listed in subparagraphs (B) through (D) above, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required by item
(3)(d) thereof, if applicable;
the Trustee shall cancel the Restricted Definitive Note, increase or cause to be
increased the aggregate principal amount of, in the case of clause (A) above,
the appropriate Restricted Global Note, in the case of clause (B) above, the
144A Global Note, in the case of clause (D) above, the Regulation S Global Note,
and in all other cases, the IAI Global Note.
(ii) Restricted Definitive Notes to Beneficial
Interests in Unrestricted Global Notes. A Holder of a Restricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted Global Note
or transfer such Restricted Definitive Note
<PAGE> 37
32
to a Person who takes delivery thereof in the form of a beneficial interest in
an Unrestricted Global Note only if:
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the Registration
Rights Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the applicable
Letter of Transmittal that it is not (1) a broker-dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a Person
who is an affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to
the Shelf Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a
Restricted Broker- Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes proposes to
exchange such Notes f or a beneficial interest in the Unrestricted
Global Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (1)(c) thereof; or (2) if
the Holder of such Restricted Definitive Notes proposes to transfer
such Notes to a Person who shall take delivery thereof in the form of a
beneficial interest in the Unrestricted Global Note, a certificate from
such Holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof; and, in each such case set forth in
this subparagraph (D), if the Registrar so requests or if the
Applicable Procedures so require, an Opinion of Counsel in form
reasonably acceptable to the Registrar to the effect that such exchange
or transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private Placement
Legend are no longer required in order to maintain compliance with the
Securities Act. Upon satisfaction of the conditions of any of the
subparagraphs in this Section 2.06(d)(ii), the Trustee shall cancel the
Restricted Definitive Notes so transferred or exchanged and increase or
cause to be increased the aggregate principal amount of the
Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial
Interests in Unrestricted Global Notes. A Holder of an Unrestricted Definitive
Note may exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Definitive Notes to a Person who takes delivery thereof in
the form of a beneficial interest in an Unrestricted Global Note at any time.
Upon receipt of a request for such an exchange or transfer, the Trustee shall
cancel the applicable Unrestricted Definitive Note and increase or cause to be
increased the aggregate principal amount of one of the Unrestricted Global
Notes. If any such
<PAGE> 38
33
exchange or transfer from a Definitive Note to a beneficial interest is effected
pursuant to subparagraphs (ii)(B), (ii)(D) or (iii) above at a time when an
Unrestricted Global Note has not yet been issued, the Company shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02 hereof,
the Trustee shall authenticate one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of Definitive Notes so
transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive
Notes. Upon request by a Holder of Definitive Notes and such Holder's compliance
with the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
(i) Restricted Definitive Notes to Restricted
Definitive Notes. Any Restricted Definitive Note may be transferred to and
registered in the name of Persons who take delivery thereof in the form of a
Restricted Definitive Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to
Rule 144A under the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof;
(B) if the transfer will be made pursuant to
Rule 903 or Rule 904, then the transferor must deliver a certificate in
the form of Exhibit B hereto, including the certifications in item (2)
thereof; and
(C) if the transfer will be made pursuant to
any other exemption from the registration requirements of the
Securities Act, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications, certificates
and Opinion of Counsel required by item (3) thereof, if applicable.
(ii) Restricted Definitive Notes to Unrestricted
Definitive Notes. Any Restricted Definitive Note may be exchanged by the Holder
thereof for an Unrestricted Definitive Note or transferred to a Person or
Persons who take delivery thereof in the form of an Unrestricted Definitive Note
if:
<PAGE> 39
34
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the Registration
Rights Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the applicable
Letter of Transmittal that it is not (1) a broker-dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a Person
who is an affiliate (as defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant
to the Shelf Registration Statement in accordance with the Registration
Rights Agreement;
(C) any such transfer is effected by a
Restricted Broker- Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes proposes to
exchange such Notes f or an Unrestricted Definitive Note, a certificate
from such Holder in the form of Exhibit C hereto, including the
certifications in item (1)(d) thereof; or (2) if the Holder of such
Restricted Definitive Notes proposes to transfer such Notes to a Person
who shall take delivery thereof in the form of an Unrestricted
Definitive Note, a certificate from such Holder in the form of Exhibit
B hereto, including the certifications in item (4) thereof; and, in
each such case set forth in this subparagraph (D), if the Registrar so
requests, an Opinion of Counsel in form reasonably acceptable to the
Company to the effect that such exchange or transfer is in compliance
with the Securities Act and that the restrictions on transfer contained
herein and in the Private Placement Legend are no longer required in
order to maintain compliance with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted
Definitive Notes. A Holder of Unrestricted Definitive Notes may transfer such
Notes to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note. Upon receipt of a request to register such a transfer, the
Registrar shall register the Unrestricted Definitive Notes pursuant to the
instructions from the Holder thereof.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer
in accordance with the Registration Rights Agreement, the Company shall issue
and, upon receipt of an Authentication Order in accordance with Section 2.02,
the Trustee shall authenticate (i) one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered for acceptance by Persons that
certify in the applicable Letters of Transmittal that (x) they are not
broker-dealers, (y) they are not participating in a distribution of the Exchange
Notes and (z) they are not affiliates (as defined in Rule 144) of the Company,
and accepted for exchange
<PAGE> 40
35
in the Exchange Offer and (ii) Definitive Notes in an aggregate principal amount
equal to the principal amount of the Restricted Definitive Notes accepted for
exchange in the Exchange Offer. Concurrently with the issuance of such Notes,
the Trustee shall cause the aggregate principal amount of the applicable
Restricted Global Notes to be reduced accordingly, and the Company shall execute
and, upon receipt of an Authentication Order pursuant to Section 2.02, the
Trustee shall authenticate and deliver to the Persons designated by the Holders
of Definitive Notes so accepted Definitive Notes in the appropriate principal
amount.
(g) Legends. The following legends shall appear on the face of
all Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B)
below, each Global Note and each Definitive Note (and all Notes issued
in exchange therefor or substitution thereof) shall bear the legend in
substantially the following form:
"THIS NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
PERSONS, EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB"), (B) IS ACQUIRING THIS
NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER
THE SECURITIES ACT OR (C) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR"
(AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER
THE SECURITIES ACT) (AN "IAI"), (2) AGREES THAT IT WILL NOT RESELL OR
OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY OR ANY OF ITS
SUBSIDIARIES, (B) TO A PERSON WHOM THE HOLDER REASONABLY BELIEVES IS A
QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (c) IN AN OFFSHORE
TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR 904 UNDER THE
SECURITIES ACT, (D) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144 UNDER THE SECURITIES ACT, (E) TO AN IAI THAT, PRIOR TO SUCH
TRANSFER, FURNISHES TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND
<PAGE> 41
36
AGREEMENTS RELATING TO THE REGISTRATION OF TRANSFER OF THIS NOTE (THE
FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH
TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS
THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT
SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (F) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO
THE COMPANY) OR (G) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
AND, IN EACH CASE, IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN
INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND
"UNITED STATES" HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF
REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A
PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF
THIS NOTE IN VIOLATION OF THE FOREGOING."
(B) Notwithstanding the foregoing, any
Global Note or Definitive Note issued pursuant to subparagraphs
(b)(iv), (c)(ii), (c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f)
to this Section 2.06 (and all Notes issued in exchange therefor or
substitution thereof) shall not bear the Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear
a legend in substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY
PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE
SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF
THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT
IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL
NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO
SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE
TRANSFERRED TO
<PAGE> 42
37
A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY."
(iii) Regulation S Temporary Global Note Legend. The
Regulation S Temporary Global Note shall bear a legend in substantially the
following form:
"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND
THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED
NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER
THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY
GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON."
(h) Cancellation and/or Adjustment of Global Notes. At such
time as all beneficial interests in a particular Global Note have been exchanged
for Definitive Notes or a particular Global Note has been redeemed, repurchased
or cancelled in whole and not in part, each such Global Note shall be returned
to or retained and cancelled by the Trustee in accordance with Section 2.11
hereof. At any time prior to such cancellation, if any beneficial interest in a
Global Note is exchanged for or transferred to a Person who will take delivery
thereof in the form of a beneficial interest in another Global Note or for
Definitive Notes, the principal amount of Notes represented by such Global Note
shall be reduced accordingly and an endorsement shall be made on such Global
Note by the Trustee or by the Depositary at the direction of the Trustee to
reflect such reduction; and if the beneficial interest is being exchanged for or
transferred to a Person who will take delivery thereof in the form of a
beneficial interest in another Global Note, such other Global Note shall be
increased accordingly and an endorsement shall be made on such Global Note by
the Trustee or by the Depositary at the direction of the Trustee to reflect such
increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and
exchanges, the Company shall execute and the Trustee shall authenticate Global
Notes and Definitive Notes upon receipt of an Authentication Order.
(ii) No service charge shall be made to a holder of
a beneficial interest in a Global Note or to a Holder of a Definitive Note for
any registration of transfer or exchange, but the Company may require payment of
a sum sufficient to cover any transfer tax or similar governmental charge
payable in connection therewith (other than any such transfer taxes or similar
governmental charge payable upon exchange or transfer pursuant to Sections 2.10,
3.06, 4.07, 4.08 and 9.05 hereof.
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38
(iii) The Registrar shall not be required to
register the transfer of or exchange any Note selected for redemption in whole
or in part, except the unredeemed portion of any Note being redeemed in part.
(iv) All Global Notes and Definitive Notes issued
upon any registration of transfer or exchange of Global Notes or Definitive
Notes shall be the valid obligations of the Company, evidencing the same
Indebtedness, and entitled to the same benefits under this Indenture, as the
Global Notes or Definitive Notes surrendered upon such registration of transfer
or exchange.
(v) The Company shall not be required (A) to
issue, to register the transfer of or to exchange any Notes during a period
beginning at the opening of business 15 days before the day of any selection of
Notes for redemption under Section 3.02 hereof and ending at the close of
business on the day of selection, (B) to register the transfer of or to exchange
any Note so selected for redemption in whole or in part, except the unredeemed
portion of any Note being redeemed in part or (c) to register the transfer of or
to exchange a Note between a record date and the next succeeding interest
payment date.
(vi) Prior to due presentment for the registration
of a transfer of any Note, the Trustee, any Agent and the Company may deem and
treat the Person in whose name any Note is registered as the absolute owner of
such Note for the purpose of receiving payment of principal of and interest on
such Notes and for all other purposes, and none of the Trustee, any Agent or the
Company shall be affected by notice to the contrary.
(vii) The Trustee shall authenticate Global Notes
and Definitive Notes in accordance with the provisions of Section 2.02 hereof.
(viii) All certifications, certificates and Opinions
of Counsel required to be submitted to the Registrar pursuant to this Section
2.06 to effect a registration of transfer or exchange may be submitted by
facsimile.
SECTION 2.07 REPLACEMENT NOTES
If any mutilated Note is surrendered to the Trustee or the
Company and the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, the Company shall issue and the Trustee,
upon receipt of an Authentication Order, shall authenticate a replacement Note
if the Trustee's requirements are met. If required by the Trustee or the
Company, an indemnity bond must be supplied by the Holder that is sufficient in
the judgment of the Trustee and the Company to protect the Company, the Trustee,
any Agent and any authenticating agent from any loss that any of them may suffer
if a Note is replaced. The Company may charge for its expenses in replacing a
Note. Every replacement
<PAGE> 44
39
Note is an additional obligation of the Company and shall be entitled to all of
the benefits of this Indenture equally and proportionately with all other Notes
duly issued hereunder.
SECTION 2.08 OUTSTANDING NOTES
The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those cancelled by it, those delivered
to it for cancellation, those reductions in the interest in a Global Note
effected by the Trustee in accordance with the provisions hereof, and those
described in this Section as not outstanding. Except as set forth in Section
2.09 hereof, a Note does not cease to be outstanding because the Company or an
Affiliate of the Company holds the Note. If a Note is replaced pursuant to
Section 2.07 hereof, it ceases to be outstanding unless the Trustee receives
proof satisfactory to it that the replaced Note is held by a bona fide
purchaser. If the principal amount of any Note is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.If
the Paying Agent (other than the Company, a Subsidiary or an Affiliate of any
thereof) holds, on a redemption date or maturity date, money sufficient to pay
Notes payable on that date, then on and after that date such Notes shall be
deemed to be no longer outstanding and shall cease to accrue interest.
SECTION 2.09 TREASURY NOTES
In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by the Company, or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company, shall
be considered as though not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes that the Trustee knows are so owned
shall be so disregarded.
SECTION 2.10 TEMPORARY NOTES
Until certificates representing Notes are ready for delivery,
the Company may prepare and the Trustee, upon receipt of an Authentication
Order, shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form of certificated Notes but may have variations that the
Company considers appropriate for temporary Notes and as shall be reasonably
acceptable to the Trustee. Without unreasonable delay, the Company shall prepare
and the Trustee, upon receipt of an Authentication Order, shall authenticate
definitive Notes in exchange for temporary Notes. Holders of temporary Notes
shall be entitled to all of the benefits of this Indenture.
<PAGE> 45
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SECTION 2.11 CANCELLATION
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall destroy
cancelled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all cancelled Notes shall be delivered
to the Company. The Company may not issue new Notes to replace Notes that it has
paid or that have been delivered to the Trustee for cancellation.
SECTION 2.12 DEFAULTED INTEREST
If the Company defaults in a payment of interest on the Notes,
it shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01 hereof. The Company shall notify the Trustee in
writing of the amount of defaulted interest proposed to be paid on each Note and
the date of the proposed payment. The Company shall fix or cause to be fixed
each such special record date and payment date, provided that no such special
record date shall be less than 10 days prior to the related payment date for
such defaulted interest. At least 15 days before the special record date, the
Company (or, upon the written request of the Company, the Trustee in the name
and at the expense of the Company) shall mail or cause to be mailed to Holders a
notice that states the special record date, the related payment date and the
amount of such interest to be paid.
ARTICLE 3
REDEMPTION
SECTION 3.01 NOTICES TO TRUSTEE
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 45 days (unless a shorter period is acceptable to the Trustee) but not
more than 60 days before a redemption date, an Officers' Certificate setting
forth (i) the clause of this Indenture pursuant to which the redemption shall
occur, (ii) the redemption date, (iii) the principal amount of Notes to be
redeemed and (iv) the redemption price.
SECTION 3.02 SELECTION OF NOTES TO BE REDEEMED
If less than all of the Notes are to be redeemed at any time,
the Trustee shall select the Notes to be redeemed among the Holders of the Notes
in compliance with the requirements of the principal national securities
exchange, if any, on which the Notes are
<PAGE> 46
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listed or, if the Notes are not so listed, on a pro rata basis, by lot or in
accordance with any other method the Trustee considers fair and appropriate. In
the event of partial redemption by lot, the particular Notes to be redeemed
shall be selected, unless otherwise provided herein, not less than 30 nor more
than 60 days prior to the redemption date by the Trustee from the outstanding
Notes not previously called for redemption.
The Trustee shall promptly notify the Company in writing of
the Notes selected for redemption and, in the case of any Note selected for
partial redemption, t he principal amount thereof to be redeemed. Notes and
portions of Notes selected shall be in amounts of $1,000 or integral multiples
of $1,000; except that if all of the Notes of a Holder are to be redeemed, the
entire outstanding amount of Notes held by such Holder, even if not an integral
multiple of $1,000, shall be redeemed. Except as provided in the preceding
sentence, provisions of this Indenture that apply to Notes called for redemption
also apply to portions of Notes called for redemption.
SECTION 3.03 NOTICE OF REDEMPTION
At least 30 days but not more than 60 days before a redemption
date, the Company shall mail or cause to be mailed, by first class mail, a
notice of redemption to each Holder whose Notes are to be redeemed at its
registered address.
The notice shall identify the Notes to be redeemed and shall
state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of
the principal amount of such Note to be redeemed and that, after the
redemption date upon surrender of such Note, a new Note or Notes in
principal amount equal to the unredeemed portion shall be issued upon
cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered
to the Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such
redemption payment, interest on Notes called for redemption ceases to
accrue on and after the redemption date;
<PAGE> 47
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(g) the paragraph of the Notes and/or Section of this
Indenture pursuant to which the Notes called for redemption are being
redeemed; and
(h) that no representation is made as to the correctness
or accuracy of the CUSIP number, if any, listed in such notice or
printed on the Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company shall have delivered to the Trustee, at least 45 days prior to the
redemption date, an Officers' Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as provided
in the preceding paragraph.
SECTION 3.04 EFFECT OF NOTICE OF REDEMPTION
Once notice of redemption is mailed in accordance with Section
3.03 hereof, Notes called for redemption become irrevocably due and payable on
the redemption date at the redemption price. A notice of redemption may not be
conditional.
SECTION 3.05 DEPOSIT OF REDEMPTION PRICE
One Business Day prior to the redemption date, the Company
shall deposit with the Trustee or with the Paying Agent immediately available
funds sufficient to pay the redemption price of and accrued interest on all
Notes to be redeemed on that date. The Trustee or the Paying Agent shall
promptly return to the Company any money deposited with the Trustee or the
Paying Agent by the Company in excess of the amounts necessary to pay the
redemption price of, and accrued interest on, all Notes to be redeemed.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
the Notes or the portions of Notes called for redemption. If a Note is redeemed
on or after an interest record date but on or prior to the related interest
payment date, then any accrued and unpaid interest shall be paid to the Person
in whose name such Note was registered at the close of business on such record
date. If any Note called for redemption shall not be so paid upon surrender for
redemption because of the failure of the Company to comply with the preceding
paragraph, interest shall be paid on the unpaid principal, from the redemption
date until such principal is paid, and to the extent lawful on any interest not
paid on such unpaid principal, in each case at the rate provided in the Notes
and in Section 4.01 hereof.
SECTION 3.06 NOTES REDEEMED IN PART
Upon surrender of a Note that is redeemed in part, the Company
shall issue and, upon receipt of an Authentication Order, the Trustee shall
authenticate for the Holder
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at the expense of the Company a new Note equal in principal amount to the
unredeemed portion of the Note surrendered.
SECTION 3.07 OPTIONAL REDEMPTION
Except as set forth below, the Notes will not be redeemable at
the Company's option prior to February 15, 2002. Thereafter, the Notes will be
subject to redemption at any time at the option of the Company, in whole or in
part, upon not less than 30 or more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
applicable redemption date, if redeemed during the twelve-month period beginning
on February 15 of the years indicated below:
<TABLE>
<CAPTION>
YEAR PERCENTAGE
<S> <C>
2002............................................104.750%
2003............................................102.375%
2004 and thereafter.............................100.000%
</TABLE>
Notwithstanding the foregoing, at any time or from time to
time on or prior to February 15, 2001, the Company may redeem up to 35% of the
aggregate principal amount of Notes originally issued under this Indenture at a
redemption price of 109.500% of the principal amount thereof, plus accrued and
unpaid interest and Liquidated Damages thereon, if any, to the redemption date,
with the net cash proceeds of one or more Equity Offerings; provided that at
least $100,000,000 in aggregate principal amount of Notes remain outstanding
immediately after the occurrence of such redemption; and provided, further, that
such redemption shall occur within 90 days of the date of the closing of such
Equity Offering.
SECTION 3.08 NO MANDATORY REDEMPTION
The Company shall not be required to make mandatory redemption
payments with respect to the Notes.
ARTICLE 4
COVENANTS
SECTION 4.01 PAYMENT OF NOTES
The Company shall pay or cause to be paid the principal of,
premium, if any, and interest on the Notes on the dates and in the manner
provided in the Notes. Principal, premium, if any, and interest shall be
considered paid on the date due if the Paying Agent, if other than the Company
or a Subsidiary thereof, holds as of 10:00 a.m. Eastern Time on
<PAGE> 49
44
the due date money deposited by the Company in immediately available funds and
designated for and sufficient to pay all principal, premium, if any, and
interest then due. The Company shall pay all Liquidated Damages, if any, in the
same manner on the dates and in the amounts set forth in the Registration Rights
Agreement. The Company's Obligations under the Notes, this Indenture and the
Registration Rights Agreement are referred to herein as the "Company
Obligations."
The Company shall pay interest (including Accrued Bankruptcy
Interest in any proceeding under any Bankruptcy Law) on overdue principal at the
then applicable interest rate on the Notes to the extent lawful; it shall pay
interest (including Accrued Bankruptcy Interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest and Liquidated Damages
(without regard to any applicable grace period) at the same rate to the extent
lawful.
SECTION 4.02 MAINTENANCE OF OFFICE OR AGENCY
The Company shall maintain in the Borough of Manhattan, the
City of New York, an office or agency (which may be an office of the Trustee or
an affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
The Company may also from time to time designate one or more
other offices or agencies where the Notes may be presented or surrendered for
any or all su ch purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, the City of New York for such purposes. The Company shall
give prompt written notice to the Trustee of any such designation or rescission
and of any change in the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of
the Trustee as one such office or agency of the Company in accordance with
Section 2.03 hereof.
SECTION 4.03 REPORTS
Whether or not required by the rules and regulations of the
SEC, so long as any Notes are outstanding, the Company shall furnish to the
Holders of Notes and to the Trustee (i) copies of all quarterly and annual
financial information that would be required to
<PAGE> 50
45
be contained in a filing with the SEC on Forms 10-Q and 10-K if the Company were
required to file such Forms, including a "Management's Discussion and Analysis
of Financial Condition and Results of Operations" and, with respect to the
annual information only, a report thereon by the Company's certified independent
accountants and (ii) copies of all current reports that would be required to be
filed with the SEC on Form 8-K if the Company were required to file such
reports. In addition, whether or not required by the rules and regulations of
the SEC, the Company shall file a copy of all such information and reports with
the SEC for public availability (unless the SEC shall not accept such a filing)
and make such information available to securities analysts and prospective
investors upon request. In addition, the Company and the Subsidiary Guarantors
have agreed that, for so long as any Notes remain outstanding, they shall
furnish to the Holders and to securities analysts and prospective investors,
upon their request, the information required to be delivered pursuant to Rule
144A(d)(4) under the Securities Act.
SECTION 4.04 COMPLIANCE CERTIFICATE
(a) The Company shall deliver to the Trustee, within 90
days after the end of each fiscal year, an Officers' Certificate stating that a
review of the activities of the Company and its Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Company and the Subsidiary
Guarantors have kept, observed, performed and fulfilled their obligations under
this Indenture, and further stating, as to each such Officer signing such
certificate, that to the best of his or her knowledge the Company and the
Subsidiary Guarantors are not in default in the performance or observance of any
of the terms, provisions and conditions of this Indenture (or, if a Default or
Event of Default shall have occurred and be continuing, describing all such
Defaults or Events of Default of which he or she may have knowledge and what
action the Company is taking or proposes to take with respect thereto) and that
to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of or
interest, if any, on the Notes is prohibited or if such event has occurred, a
description of the event and what action the Company is taking or proposes to
take with respect thereto.
(b) The Company shall, so long as any of the Notes are
outstanding, deliver to the Trustee, within five Business Days of any Officer
becoming aware of any Default or Event of Default, an Officers' Certificate
specifying such Default or Event of Default and what action the Company is
taking or proposes to take with respect thereto.
SECTION 4.05 TAXES
The Company shall pay, and shall cause each of its
Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and
governmental levies except such as are contested in good faith and by
appropriate proceedings or where the failure to effect such
<PAGE> 51
46
payment would not have a material adverse effect on the ability fo the Company
and the Subsidiary Guarantors to satisfy their obligations under the Notes, the
Subsidiary Guarantees and the Indenture.
SECTION 4.06 STAY, EXTENSION AND USURY LAWS
The Company covenants (to the extent that it may lawfully do
so) that it shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay, extension or
usury law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Indenture; and the Company (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not, by resort to any
such law, hinder, delay or impede the execution of any power herein granted to
the Trustee, but shall suffer and permit the execution of every such power as
though no such law has been enacted.
SECTION 4.07 CHANGE OF CONTROL
Upon the occurrence of a Change of Control, each Holder of
Notes shall have the right to require the Company to repurchase all or any part
(equal to $1,000 or an integral multiple thereof) of such Holder's Notes
pursuant to the offer described below (the "Change of Control Offer") at an
offer price in cash equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the date
of purchase (the "Change of Control Payment"). Within 15 Business Days following
any Change of Control, the Company shall mail a notice to each Holder describing
the transaction or transactions that constitute the Change of Control and
offering to repurchase Notes on the date specified in such notice, which date
shall be no earlier than 30 days and no later than 60 days from the date such
notice is mailed (the "Change of Control Payment Date"), pursuant to the
procedures required by this Indenture and described in such notice. The Company
shall comply with the requirements of Rule 14e-1 under the Exchange Act and any
other securities laws and regulations thereunder to the extent such laws and
regulations are applicable in connection with the repurchase of the Notes as a
result of a Change of Control. To the extent that any applicable securities laws
or regulations conflict with the terms hereof, the Company shall comply with
such laws or regulations and shall not be deemed to have breached its
obligations under this Indenture or Notes by virtue thereof.
If the Change of Control Purchase Date is on or after an
interest record date and on or before the related interest payment date, any
accrued and unpaid interest shall be paid to the Person in whose name a Note is
registered at the close of business on such record date, and no additional
interest shall be payable to Holders who tender Notes pursuant to the Change of
Control Offer.
<PAGE> 52
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Upon the commencement of a Change of Control Offer, the
Company shall send, by first class mail, a notice to each of the Holders, with a
copy of each such notice to the Trustee. The notice shall contain all
instructions and materials necessary to enable such Holders to tender Notes
pursuant to the Change of Control Offer. The Change of Control Offer shall be
made to all Holders. The notice, which shall govern the terms of the Change of
Control Offer, shall state:
(a) that the Change of Control Offer is being
made pursuant to this covenant and the length of time the Change of
Control Offer shall remain open;
(b) the purchase price and the Change of Control
Purchase Date;
(c) that any Note not tendered or accepted for
payment shall continue to accrue interest;
(d) that, unless the Company defaults in making
such payment, any Note accepted for payment pursuant to the Change of
Control Offer shall cease to accrete or accrue interest after the
Change of Control Purchase Date;
(e) that Holders electing to have a Note
purchased pursuant to any Change of Control Offer shall be required to
surrender the Note, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Note completed, or transfer by
book-entry transfer, to the Company, a Depositary, if appointed by the
Company, or a Paying Agent at the address specified in the notice at
least three days before the Change of Control Purchase Date; and
(f) that Holders shall be entitled to withdraw
their election if the Company, the Depositary or the Paying Agent, as
the case may be, receives, not later than the expiration of the Change
of Control Offer Period, a telegram, telex, facsimile transmission or
letter setting forth the name of the Holder, the principal amount of
the Note the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Note purchased.
On or before the Change of Control Payment Date, the Company
shall, to the extent lawful, (1) accept for payment all Notes or portions
thereof properly tendered pursuant to the Change of Control Offer, (2) deposit
with the paying agent an amount equal to the Change of Control Payment in
respect of all Notes or portions thereof so tendered and (3) deliver or cause to
be delivered to the Trustee the Notes so accepted together with an Officers'
Certificate stating the aggregate principal amount of Notes or portions thereof
being purchased by the Company. The paying agent shall promptly mail to each
Holder of Notes so tendered the Change of Control Payment for such Notes, and,
upon receipt of an
<PAGE> 53
48
Authentication Order, the Trustee shall promptly authenticate and mail (or cause
to be transferred by book entry) to each Holder a new Note equal in principal
amount to any unpurchased portion of the Notes surrendered, if any; provided
that each such new Note shall be in a principal amount of $1,000 or an integral
multiple thereof. The Company shall publicly announce the results of the Change
of Control Offer on or as soon as practicable after the Change of Control
Payment Date.
The Company will not be required to make a Change of Control
Offer upon a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the
requirements set forth herein applicable to a Change of Control Offer made by
the Company and purchases all Notes validly tendered and not withdrawn under
such Change of Control Offer.
The Change of Control provisions described above shall be
applicable whether or not any other provisions of this Indenture are applicable.
SECTION 4.08 ASSET SALES
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, consummate an Asset Sale unless (i) the Company (or
the Restricted Subsidiary, as the case may be) receives consideration at the
time of such Asset Sale at least equal to the fair market value (evidenced by a
resolution of the Board of Directors set forth in an Officers' Certificate
delivered to the Trustee in the case of any Asset Sale for which the Company or
any of its Restricted Subsidiaries receives consideration in excess of
$15,000,000) of the assets or Equity Interests issued or sold or otherwise
disposed of and (ii) at least 80% of the consideration therefor received by the
Company or such Restricted Subsidiary is in the form of cash or Cash
Equivalents; provided that the amount of (x) any liabilities (as shown on the
Company's or such Restricted Subsidiary's most recent balance sheet), of the
Company or any Restricted Subsidiary (other than contingent liabilities and
liabilities that are by their terms subordinated to the Notes or any guarantee
thereof) that are assumed by the transferee of any such assets pursuant to a
customary novation or other agreement that releases the Company or such
Restricted Subsidiary from further liability and (y) any securities, notes or
other obligations received by the Company or any such Restricted Subsidiary from
such transferee that are converted by the Company or such Restricted Subsidiary
within 90 days following the closing of the Asset Sale into cash (to the extent
of the cash received), shall be deemed to be cash for purposes of this
provision.
Within 360 days of the receipt of any Net Proceeds from an
Asset Sale, the Company and its Restricted Subsidiaries may apply such Net
Proceeds, at their option, (a) to repay secured Indebtedness (and, in the case
of any such Indebtedness that was borrowed under a revolving credit line, to
correspondingly reduce commitments with respect thereto), or (b) to the
acquisition of a controlling interest in another business, the making of a
capital
<PAGE> 54
49
expenditure or the acquisition of other long-term assets, in each case, in the
same or a related or complementary line of business as the Company or any of its
Restricted Subsidiaries was engaged in on the date of this Indenture (as
determined in good faith by the Company). Pending the final application of any
such Net Proceeds, the Company may temporarily reduce the revolving credit lines
under the New Credit Facility (without any corresponding commitment reduction)
or otherwise invest such Net Proceeds in any manner that is not prohibited by
this Indenture. Any Net Proceeds from Asset Sales that are not applied or
invested as provided in the first sentence of this paragraph shall be deemed to
constitute "Excess Proceeds."
Not later than 30 days after any date (an "Asset Sale Offer
Trigger Date") that the aggregate amount of Excess Proceeds exceeds $10,000,000,
the Company shall mail to each holder of Notes at such holder's registered
address a notice stating: (i) that an Asset Sale Offer Trigger Date has occurred
and that the Company is offering to purchase the maximum principal amount of
Notes that may be purchased out of the Excess Proceeds, at an offer price in
cash equal to 100% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the date of purchase (the
"Asset Sale Offer Purchase Date"), which shall be a business day, specified in
such notice, that is not earlier than 30 days or later than 60 days from the
date such notice is mailed; (ii) the amount of accrued and unpaid interest and
Liquidated Damages, if any, thereon as of the Asset Sale Offer Purchase Date;
(iii) that any Note not tendered shall continue to accrue interest and
Liquidated Damages, if any; (iv) that, unless the Company defaults in the
payment of the purchase price for the Notes payable pursuant to the Asset Sale
Offer, any Notes accepted for payment pursuant to the Asset Sale Offer shall
cease to accrue interest and Liquidated Damages, if any, after the Asset Sale
Offer Purchase Date; (v) the procedures, consistent with this Indenture, to be
followed by a holder of Notes in order to accept an Asset Sale Offer or to
withdraw such acceptance; and (vi) such other information as may be required by
this Indenture and applicable laws and regulations.
On the Asset Sale Offer Purchase Date, the Company shall: (i)
accept for payment the maximum principal amount of Notes or portions thereof
tendered pursuant to the Asset Sale Offer that can be purchased out of Excess
Proceeds from such Asset Sale; (ii) deposit with the paying agent the aggregate
purchase price of all Notes or portions thereof accepted for payment and any
accrued and unpaid interest and Liquidated Damages, if any, on such Notes as of
the Asset Sale Offer Purchase Date; and (iii) deliver or cause to be delivered
to the Trustee all Notes tendered pursuant to the Asset Sale Offer. The paying
agent shall promptly mail to each holder of Notes or portions thereof accepted
for payment an amount equal to the purchase price for such Note plus any accrued
and unpaid interest and Liquidated Damages, if any, thereon, and the Trustee
shall promptly authenticate and mail to such holder of Notes accepted for
payment in part a new Note equal in principal amount to any unpurchased portion
of the Notes, and any Note not accepted for payment in whole or in part shall be
promptly returned to the holder of such Note. On and after an Asset Sale
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Offer Purchase Date, interest and Liquidated Damages, if any, shall cease to
accrue on the Notes or portions thereof accepted for payment, unless the Company
defaults in the payment of the purchase price therefor. The Company shall
announce the results of the Asset Sale Offer to holders of the Notes on or as
soon as practicable after the Asset Sale Offer Purchase Date. To the extent that
the aggregate amount of Notes tendered pursuant to an Asset Sale Offer is less
than the Excess Proceeds, the Company may use any remaining Excess Proceeds for
general corporate purposes. If the Aggregate principal amount of Notes
surrendered by Holders thereof exceeds the amount of Excess Proceeds, the
Trustee shall select the Notes to be purchased on a pro rata basis. Upon
completion of such Asset Sale Offer, the amount of Excess Proceeds shall be
reset at zero.
The Company shall comply with the applicable tender offer
rules, including the requirements of Rule 14e-1 under the Exchange Act, and all
other applicable securities laws and regulations in connection with any Asset
Sale Offer. To the extent that any applicable securities laws or regulations
conflict with the terms hereof, the Company shall comply with such laws or
regulations and shall not be deemed to have breached its obligations under this
Indenture or Notes by virtue thereof.
If the Asset Sale Purchase Date is on or after an interest
record date and on or before the related interest payment date, any accrued and
unpaid interest shall be paid to the Person in whose name a Note is registered
at the close of business on such record date, and no additional interest shall
be payable to Holders who tender Notes pursuant to the Asset Sale Offer.
SECTION 4.09 RESTRICTED PAYMENTS
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly: (i) declare or pay any
dividend or make any other payment or distribution on account of the Company's
or any of its Restricted Subsidiaries' Equity Interests (including, without
limitation, any payment in connection with any merger or consolidation involving
the Company or in connection with any settlement or resolution of any claims
against or litigation involving the Company, but not including Qualified
Insurance Payments) or to the direct or indirect holders of the Company's or any
of its Restricted Subsidiaries' Equity Interests in their capacity as such
(other than dividends or distributions or other payments payable in Equity
Interests (other than Disqualified Stock) of the Company or any successor under
this Indenture); (ii) purchase, redeem or otherwise acquire or retire for value
(including without limitation, in connection with any merger or consolidation
involving the Company) any Equity Interests of the Company; (iii) purchase,
redeem, defease or otherwise acquire or retire for value any Subordinated
Indebtedness prior to its Stated Maturity; or (iv) make any Restricted
Investment (all such payments and other actions set forth in, and not otherwise
permitted by, clauses (i) through (iv) above being collectively
<PAGE> 56
51
referred to as "Restricted Payments"), unless, at the time of and after giving
effect to such Restricted Payment:
(a) no Default or Event of Default shall have occurred
and be continuing or would occur as a consequence thereof; and
(b) the Company would, at the time of such Restricted
Payment and after giving pro forma effect thereto as if such Restricted
Payment had been made at the beginning of the applicable four-quarter
period, have been permitted to incur at least $1.00 of additional
Indebtedness pursuant to the provisions of the first paragraph of
Section 4.10; and
(c) such Restricted Payment, together with the aggregate
amount of all other Restricted Payments made by the Company and its
Restricted Subsidiaries after the date of this Indenture (excluding
Restricted Payments permitted by clauses (ii), (iii), (iv), (v) (but
only to the extent of the dividends paid to the Company or its Wholly
Owned Restricted Subsidiaries pursuant to such clause (v)) and (vii) of
the next succeeding paragraph), is less than the sum of (1) 50% of the
Consolidated Net Income of the Company for the period (taken as one
accounting period) from the beginning of the first fiscal quarter
commencing after the date of this Indenture to the end of the Company's
most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment (or, if
such Consolidated Net Income for such period is a deficit, less 100% of
such deficit), plus (2) 100% of the aggregate net cash proceeds
received by the Company from the issue or sale since the date of this
Indenture of Equity Interests of the Company (other than Disqualified
Stock) or of Disqualified Stock or debt securities of the Company that
have been converted into such Equity Interests (other than Equity
Interests (or Disqualified Stock or convertible debt securities) sold
to a Subsidiary of the Company and other than Disqualified Stock or
convertible debt securities that have been converted into Disqualified
Stock), plus (3) to the extent that any Restricted Investment that was
made after the date of this Indenture is sold for cash or otherwise
liquidated or repaid for cash, the lesser of (A) the cash return of
capital with respect to such Restricted Investment (less the cost of
disposition, if any) and (B) the initial amount of such Restricted
Investment, plus (4) 50% of any cash dividends received by the Company
or a Wholly Owned Restricted Subsidiary or a Subsidiary Guarantor after
the date of this Indenture from an Unrestricted Subsidiary of the
Company, to the extent that such dividends were not otherwise included
in Consolidated Net Income of the Company for such period, plus (5) to
the extent that any Unrestricted Subsidiary is redesignated as a
Restricted Subsidiary after the date of this Indenture, the lesser of
(A) the fair market value of the Company's and its Restricted
Subsidiaries' Investment in such Subsidiary as of the date of such
redesignation or (B) the fair market value of the Company's and its
Restricted Subsidiaries'
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52
Investment in such Subsidiary as of the date on which such Subsidiary
was originally designated as an Unrestricted Subsidiary.
The foregoing provisions shall not prohibit:
(i) the payment of any dividend within 60 days after the
date of declaration thereof, if at said date of declaration such
payment would have complied with the provisions of this Indenture;
(ii) the redemption, repurchase, retirement, defeasance or
other acquisition of any Subordinated Indebtedness or Equity Interests
of the Company or any Restricted Subsidiary in exchange for, or, so
long as no Default or Event of Default shall have occurred and be
continuing, out of the net cash proceeds of the substantially
concurrent sale (other than to a Subsidiary of the Company) of, other
Equity Interests of the Company (other than any Disqualified Stock);
provided that the amount of any such net cash proceeds that are
utilized for any such redemption, repurchase, retirement, defeasance or
other acquisition shall be excluded from clause (c)(2) of the preceding
paragraph;
(iii) so long as no Default or Event of Default shall have
occurred and be continuing, the defeasance, redemption, repurchase or
other acquisition of Subordinated Indebtedness with the net cash
proceeds from an incurrence of Permitted Refinancing Indebtedness;
(iv) so long as no Default or Event of Default shall have
occurred and be continuing, the retirement, repurchase or redemption of
any shares of Disqualified Stock or any Subordinated Indebtednes by
conversion into, or by exchange for, shares of Disqualified Stock, or
out of the net cash proceeds of the substantially concurrent sale
(other than to a Subsidiary of the Company) of other shares of
Disqualified Stock; provided that (a) such newly issued Disqualified
Stock is not subject to mandatory redemption earlier than the Stated
Maturity of the Disqualified Stock or Subordinated Indebtedness being
retired, repurchased or redeemed, (b) such Disqualified Stock is in an
aggregate liquidation preference that is equal to or less than the sum
of (x) the aggregate liquidation preference of the Disqualified Stock
being retired or the aggregate principal amount of the Subordinated
Indebtedness being repurchased or redeemed, (y) the amount of accrued
and unpaid dividends or interest, if any, and premiums owed, if any, on
the Disqualified Stock or Subordinated Indebtedness being retired,
repurchased or redeemed and (z) the amount of customary fees, expenses
and costs related to the incurrence of such Disqualified Stock and (c)
such newly issued Disqualified Stock is incurred by the same Person
that initially incurred the Disqualified Stock or Subordinated
Indebtedness being retired, repurchased or redeemed, except that the
Company may
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53
incur Disqualified Stock to refund or refinance Disqualified Stock of
any Wholly Owned Subsidiary of the Company or any Subsidiary Guarantor;
(v) the payment of any dividend or other distribution by a
Restricted Subsidiary of the Company to the holders of any class of its
Equity Interests on a pro rata basis;
(vi) so long as no Default or Event of Default shall have
occurred and be continuing, the repurchase, redemption or other
acquisition or retirement for value of any Equity Interests of the
Company or any Restricted Subsidiary of the Company held by any
director, officer or employee (or any of its Restricted Subsidiaries')
pursuant to any director, officer or employee equity subscription
agreement, stock option agreement, employment agreement or employee
benefit plan or similar plan or arrangement; provided that the
aggregate price paid for all such repurchased, redeemed, acquired or
retired Equity Interests shall not exceed $1,000,000 in any one fiscal
year;
(vii) repurchases of Equity Interests deemed to occur upon
the exercise of stock options or warrants upon the surrender of Equity
Interests to pay the exercise price and any applicable taxes with
respect to such stock options or warrants; and
(viii) so long as no Default or Event of Default shall have
occurred and be continuing, Restricted Payments not otherwise permitted
hereby in an aggregate amount not to exceed $10,000,000 since the date
of this Indenture.
The Board of Directors may designate any Restricted Subsidiary
to be an Unrestricted Subsidiary if such designation would not cause a Default;
provided that in no event shall the business currently operated by the
Subsidiary Guarantors be transferred to any Subsidiary other than a Restricted
Subsidiary. For purposes of making such determination, all Investments made by
the Company and its Restricted Subsidiaries (except to the extent repaid in
cash) in the Subsidiary so designated shall be deemed to be Restricted Payments
at the time of such designation and shall reduce the amount available for
Restricted Payments under the first paragraph of this covenant. All such
outstanding Investments shall be deemed to constitute Investments in an amount
equal to the greatest of (x) the net book value of such Investments at the time
of such designation and (y) the fair market value of such Investments at the
time of such designation (as determined in good faith by the Company's Board of
Directors). Such designation shall only be permitted if such Restricted Payment
would be permitted at such time and if such Restricted Subsidiary otherwise
meets the definition of an Unrestricted Subsidiary.
The amount of all Restricted Payments (other than cash) shall
be the fair market value on the date of the Restricted Payment of the assets or
securities proposed to be
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54
transferred or issued by the Company or such Subsidiary, as the case may be,
pursuant to the Restricted Payment. The fair market value of any non-cash
Restricted Payment with a fair market value in excess of $1,000,000 shall be
determined by the Board of Directors whose resolution with respect thereto shall
be delivered to the Trustee, such determination to be based upon an opinion or
appraisal issued by an accounting, appraisal or investment banking firm of
national standing if such fair market value exceeds $10,000,000. Not later than
the date of making any Restricted Payment, the Company shall deliver to the
Trustee an Officers' Certificate stating that such Restricted Payment is
permitted and setting forth the basis upon which the calculations required by
Section 4.09 were computed, together with a copy of any fairness opinion or
appraisal required by this Indenture.
SECTION 4.10 INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF DISQUALIFIED STOCK
The Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Indebtedness) and that the Company shall not, and shall not permit any of its
Subsidiaries to, issue any Disqualified Stock; provided, however, that the
Company and the Subsidiary Guarantors may incur Indebtedness (including Acquired
Indebtedness) and the Company and the Subsidiary Guarantors may issue shares of
Disqualified Stock if (A) the Fixed Charge Coverage Ratio for the Company's most
recently ended four full fiscal quarters for which internal financial statements
are available immediately preceding the date on which such additional
Indebtedness is incurred or such Disqualified Stock is issued would have been at
least 2.5 to 1, determined on a pro forma basis (including a pro forma
application of the net proceeds therefrom and the acquisitions in connection
therewith), as if the additional Indebtedness had been incurred, or the
Disqualified Stock had been issued, as the case may be, at the beginning of such
four-quarter period, and (B) no Default or Event of Default shall have occurred
and be continuing at the time or as a consequence of the incurrence of such
Indebtedness or the issuance of such Disqualified Stock.
The provisions of the first paragraph of this covenant shall
not apply to the incurrence of any of the following items of Indebtedness
(collectively, "Permitted Debt"):
(i) the incurrence by the Company and Subsidiary Guarantors of
Indebtedness under the New Credit Facility and the issuance and
creation of letters of credit and banker's acceptances thereunder and
any related reimbursement obligation (with letters of credit being
deemed to have a principal amount equal to the maximum potential
liability of the Company and its Restricted Subsidiaries thereunder) in
an aggregate amount not to exceed $100,000,000 outstanding at any one
time under this subsection (i), less the lesser of $50,000,000 and the
aggregate amount of all Net Proceeds of Asset Sales that have been
applied since the date of
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55
this Indenture to reduce permanently the commitments with respect to
such Indebtedness pursuant to Section 4.08;
(ii) the incurrence by the Company and its Subsidiaries of
the Existing Indebtedness;
(iii) the incurrence by the Company of Indebtedness
represented by the Notes and the incurrence by the Subsidiary
Guarantors of the Subsidiary Guarantees in an aggregate principal
amount not to exceed $175,000,000;
(iv) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or
the net proceeds of which are used to refund, refinance or replace
Indebtedness of the Company or such Restricted Subsidiary that was
permitted by this Indenture to be incurred at the time it was incurred;
(v) the incurrence by the Company, any of the Subsidiary
Guarantors or any Restricted Subsidiary of intercompany Indebtedness
between or among the Company, any of the Subsidiary Guarantors or any
Restricted Subsidiary; provided, however, that (i) if the Company or a
Subsidiary Guarantor is the obligor on such Indebtedness, such
Indebtedness is unsecured and subordinated to the prior payment in full
in cash of all Obligations with respect to the Notes and the Subsidiary
Guarantees, as the case may be, and (ii)(A) any subsequent issuance or
transfer of Equity Interests that results in any such Indebtedness
being held by a Person other than the Company, a Subsidiary Guarantor
or a Restricted Subsidiary and (B) any sale or other transfer of any
such Indebtedness to a Person that is not either the Company, a
Subsidiary Guarantor or a Restricted Subsidiary shall be deemed, in
each case, to constitute an incurrence of such Indebtedness by the
Company, such Subsidiary Guarantor or such Restricted Subsidiary, as
the case may be, that was not permitted by this clause (v);
(vi) the incurrence by the Company or any of its Restricted
Subsidiaries of Hedging Obligations that are incurred for the purpose
of fixing or hedging interest rate risk with respect to any floating
rate Indebtedness that was permitted by the terms of this Indenture to
be incurred at the time it was incurred; provided, that the notional
principal amount of such Hedging Obligations at th e time such Hedging
Obligations were incurred do not exceed the principal amount of
Indebtedness to which such Hedging Obligations relate;
(vii) the Guarantee by the Company or any of the Subsidiary
Guarantors of Indebtedness of the Company or a Restricted Subsidiary of
the Company that was
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56
permitted to be incurred at the time it was incurred by another
provision of this covenant;
(viii) the incurrence by the Company's Unrestricted
Subsidiaries of Non-Recourse Debt; provided, however, that if any such
Indebtedness ceases to be Non-Recourse Debt of an Unrestricted
Subsidiary, such event shall be deemed to constitute the incurrence of
Indebtedness (and Liens, if any, securing such Indebtedness) by a
Restricted Subsidiary of the Company; or
(ix) the incurrence by the Company or any of the Subsidiary
Guarantors of Indebtedness represented by Capital Lease Obligations,
mortgage financings or purchase money obligations, in each case
incurred for the purpose of financing all or any part of the purchase
price or cost of construction or improvement of property, plant or
equipment used in the business of the Company or such Subsidiary, in an
aggregate principal amount not to exceed $20,000,000 at any time
outstanding; or
(x) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in an aggregate principal
amount (or accreted value, as applicable) at any time outstanding,
including all Permitted Refinancing Indebtedness incurred to refund,
refinance or replace any other Indebtedness incurred pursuant to this
clause (x), not to exceed $10,000,000.
For purposes of determining compliance with this covenant, in the event
that an item of Indebtedness meets the criteria of more than one of the
categories of Permitted Debt described above or is entitled to be incurred
pursuant to the first paragraph of this covenant, the Company shall, in its sole
discretion, classify such item of Indebtedness in any manner that complies with
this covenant and such item of Indebtedness shall be treated as having been
incurred pursuant to only one of such clauses or pursuant to the first paragraph
hereof. Accrual of interest, the accretion of accreted value and the payment of
interest in the form of additional Indebtedness shall not be deemed to be an
incurrence of Indebtedness for purposes of this covenant.
SECTION 4.11 LIENS
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur, assume or
suffer to exist any Liens of any kind (other than Permitted Liens) upon any
property or assets of the Company or any such Restricted Subsidiary or any
shares of stock or debt of any such Restricted Subsidiary unless (i) if such
Lien secures Indebtedness which is pari passu with the Notes, then the Notes are
secured on an equal and ratable basis with the obligations so secured until such
time as such obligation is no longer secured by a Lien or (ii) if such Lien
secures Subordinated Indebtedness, any such Lien shall be subordinated to a Lien
granted to the holders of the
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Notes in the same collateral as that securing such Lien to the same extent as
such Subordinated Indebtedness is subordinated to the Notes.
SECTION 4.12 DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING
SUBSIDIARIES
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or
suffer to exist or become effective any consensual encumbrance or consensual
restriction on the ability of any Restricted Subsidiary to (i) pay dividends or
make any other distributions to the Company or any of its Restricted
Subsidiaries on its Capital Stock or with respect to any other interest or
participation in, or measured by, its profits, or pay any indebtedness owed to
the Company or any of its Restricted Subsidiaries, (ii) make loans or advances
to the Company or any of its Restricted Subsidiaries, (iii) guarantee any
Indebtedness of the Company or any other Restricted Subsidiary or the Company or
(iv) transfer any of its properties or assets to the Company or any of its
Restricted Subsidiaries. However, the foregoing restrictions shall not apply to
encumbrances or restrictions existing under or by reason of (a) Existing
Indebtedness as in effect on the date of this Indenture, (b) the New Credit
Facility as in effect as of the date of this Indenture, and any amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings thereof, provided that such amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacement or refinancings are not materially more restrictive with respect to
such dividend and other payment restrictions than those contained in the New
Credit Facility as in effect on the date of this Indenture, (c) this Indenture,
the Notes and the Subsidiary Guarantees, (d) applicable law, (e) any instrument
governing Indebtedness or Capital Stock of a Person acquired by the Company or
any of its Restricted Subsidiaries as in effect at the time of such acquisition
(except to the extent such Indebtedness was incurred in connection with or in
contemplation of such acquisition), which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than
the Person or its Subsidiaries, or the property or assets of the Person or its
Subsidiaries, so acquired, provided that, in the case of Indebtedness, such
Indebtedness was permitted by the terms of this Indenture to be incurred at the
time it was incurred, (f) customary non-assignment provisions in leases and
other agreements entered into in the ordinary course of business, including
licenses of intellectual property, (g) purchase money obligations for property
acquired in the ordinary course of business, (h) Permitted Refinancing
Indebtedness, provided that the restrictions contained in the agreements
governing such Permitted Refinancing Indebtedness are not materially more
restrictive than those contained in the agreements governing the Indebtedness
being refinanced, (i) any agreement for the sale of a Restricted Subsidiary that
restricts distributions by that Restricted Subsidiary pending its sale or (j)
any Permitted Liens.
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SECTION 4.13 TRANSACTIONS WITH AFFILIATES
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or
otherwise dispose of any of its properties or assets to, or purchase any
property or assets from, or enter into or make or amend any transaction,
contract, agreement, understanding, loan, advance or guarantee with, or for the
benefit of, any Affiliate (each of the foregoing, an "Affiliate Transaction"),
unless (i) such Affiliate Transaction is on terms that are no less favorable in
any material respect to the Company or the relevant Restricted Subsidiary than
those that would have been obtained in a comparable transaction by the Company
or such Restricted Subsidiary with an unrelated Person and (ii) the Company
delivers to the Trustee (a) with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate consideration in excess of
$1,000,000, a resolution of the Board of Directors set forth in an Officers'
Certificate certifying that such Affiliate Transaction complies with clause (i)
above and that such Affiliate Transaction has been approved by a majority of the
disinterested members of the Board of Directors and (b) with respect to any
Affiliate Transaction or series of related Affiliate Transactions involving
aggregate consideration in excess of $5,000,000, an opinion as to the fairness
to the Company or such Restricted Subsidiary of such Affiliate Transaction from
a financial point of view issued by an accounting, appraisal or investment
banking firm of national standing; provided that the following shall not be
deemed to be Affiliate Transactions: (1) transactions pursuant to the New Credit
Facility; (2) any employment agreement or other employee benefit plan or
arrangement entered into by the Company or any of its Restricted Subsidiaries in
the ordinary course of business, (3) transactions between or among the Company
and/or its Restricted Subsidiaries and (4) Restricted Payments and Permitted
Investments that are permitted by Section 4.09.
SECTION 4.14 SALE AND LEASEBACK TRANSACTIONS
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, enter into any sale and leaseback transaction (other
than a sale and leaseback transaction with respect to any of the Excluded
Properties); provided that the Company or such Restricted Subsidiary may enter
into a sale and leaseback transaction if (i) the Company or such Restricted
Subsidiary could have (a) incurred Indebtedness in an amount equal to the
Attributable Debt relating to such sale and leaseback transaction pursuant to
the Fixed Charge Coverage Ratio test set forth in the first paragraph of Section
4.10 and (b) incurred a Lien to secure such Indebtedness pursuant to Section
4.11, (ii) the gross cash proceeds of such sale and leaseback transaction are at
least equal to the fair market value (as determined in good faith by the Board
of Directors and set forth in an Officers' Certificate delivered to the Trustee
if such proceeds exceed $15,000,000) of the property that is the subject of such
sale and leaseback transaction and (iii) the transfer of assets in such sale and
leaseback transaction is permitted by, and the Company applies the proceeds of
such transaction in compliance with, Section 4.08.
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SECTION 4.15 ADDITIONAL SUBSIDIARY GUARANTEES
If the Company or any of its Restricted Subsidiaries shall
acquire or create another Restricted Subsidiary after the date of this Indenture
(other than a Foreign Subsidiary unless the Company elects to have a Foreign
Subsidiary which is a Restricted Subsidiary guarantee the Notes), then such
newly acquired or created Restricted Subsidiary shall execute a Subsidiary
Guarantee and deliver an opinion of counsel, in accordance with the terms of
this Indenture.
ARTICLE 5
SUCCESSORS
SECTION 5.01 MERGER, CONSOLIDATION OR SALE OF ASSETS
The Company may not consolidate or merge with or into, or
sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of its properties or assets in one or more related
transactions, to another corporation, Person or entity unless (i) the Company is
the surviving corporation or the entity or the Person formed by or surviving any
such consolidation or merger (if other than the Company) or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made is a corporation organized or existing under the laws of the United States,
any state thereof or the District of Columbia; (ii) the entity or Person formed
by or surviving any such consolidation or merger (if other than the Company) or
the entity or Person to which such sale, assignment, transfer, lease, conveyance
or other disposition shall have been made assumes all the obligations of the
Company under all outstanding Notes and this Indenture pursuant to a
supplemental indenture in a form reasonably satisfactory to the Trustee; (iii)
immediately after such transaction no Default or Event of Default exists; and
(iv) except in the case of a merger of the Company with or into a Wholly Owned
Restricted Subsidiary of the Company, the Company or the entity or Person formed
by or surviving any such consolidation or merger (if other than the Company), or
to which such sale, assignment, transfer, lease, conveyance or other disposition
shall have been made shall, at the time of such transaction and after giving pro
forma effect thereto as if such transaction had occurred at the beginning of the
applicable four-quarter period, be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set
forth in the first paragraph of Sectin 4.10.
SECTION 5.02 SUCCESSOR CORPORATION SUBSTITUTED
Upon any consolidation or merger, or any sale, assignment,
transfer, lease, conveyance or other disposition of all or substantially all of
the assets of the Company in accordance with Section 5.01 hereof, the successor
corporation formed by such consolidation or into or with which the Company is
merged or to which such sale, assignment, transfer, lease, conveyance or other
disposition is made shall succeed to, and be substituted for (so that
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from and after the date of such consolidation, merger, sale, lease, conveyance
or other disposition, the provisions of this Indenture referring to the
"Company" shall refer instead to the successor corporation and not to the
Company), and may exercise every right and power of the Company under this
Indenture with the same effect as if such successor Person had been named as the
Company herein; provided, however, that the predecessor of the Company shall not
be relieved from the obligation to pay the principal of and interest on the
Notes except in the case of a sale of all of the Company's assets that meets the
requirements of Section 5.01 hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01 EVENTS OF DEFAULT
Each of the following constitutes an Event of Default:
(1) a default for 30 days in the payment when due of interest
on, or Liquidated Damages with respect to, the Notes;
(2) a default in payment when due of the principal of or
premium, if any, on the Notes;
(3) a failure by the Company or any of its Restricted
Subsidiaries to comply with Sections 4.07, 4.08, 4.09 or 4.10;
(4) a failure by the Company or any of its Subsidiaries for 60
days after receipt of notice to comply given by the Trustee or the
holders of at least 25% in principal amount of Notes then outstanding
to comply with any of its other agreements in this Indenture or the
Notes;
(5) a default under any mortgage, indenture or instrument
under which there is issued or by which there is be secured or
evidenced any Indebtedness for money borrowed by the Company or any of
its Restricted Subsidiaries (or the payment of which is guaranteed by
the Company or any of its Restricted Subsidiaries, other than
Indebtedness owed to the Company or a Restricted Subsidiary) whether
such Indebtedness or guarantee now exists, or is created after the date
of this Indenture, which default (a) is caused by a failure to pay
principal of or premium, if any, on such Indebtedness after the
expiration of the grace period provided in such Indebtedness on the
date of such default (a "Payment Default") or (b) results in the
acceleration of such Indebtedness prior to its express maturity and, in
each case, the principal amount of any such Indebtedness, together with
the principal amount of any
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other such Indebtedness under which there has been a Payment Default or
the maturity of which has been so accelerated, aggregates $10,000,000
or more, and such default has not been cured, waived or postponed
pursuant to an agreement with the holders of such Indebtedness within
30 days after written notice as provided in this Indenture, or such
acceleration shall not be rescinded or annulled within 10 days after
written notice as provided in this Indenture;
(6) a failure by the Company or any of its Restricted
Subsidiaries to pay final judgments aggregating in excess of
$10,000,000 to the extent that such judgments are not covered by
insurance, which judgments remain unpaid, undischarged or unstayed for
a period of 60 days;
(7) except as permitted by this Indenture, any Subsidiary
Guarantee shall be held in any judicial proceeding to be unenforceable
or invalid or shall cease for any reason to be in full force and effect
in any material respect or any Subsidiary Guarantor, or any Person
acting on behalf of any Subsidiary Guarantor, shall deny or disaffirm
its obligations under its Subsidiary Guarantee.
(8) the Company or any of its Significant Subsidiaries
pursuant to or within the meaning of any Bankruptcy Law:
(a) commences a voluntary case,
(b) consents to the entry of an order for relief
against it in an involuntary case,
(c) consents to the appointment of a Custodian
of it or for all or substantially all of its property,
(d) makes a general assignment for the benefit
of its creditors, or
(e) generally is not paying its debts as they
become due; or
(9) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(a) is for relief against the Company or any
Subsidiary in an involuntary case,
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(b) appoints a Custodian of the Company or any
Subsidiary or for all or substantially all of the property of
the Company or any Subsidiary, or
(c) orders the liquidation of the Company or any
Subsidiary, and the order or decree remains unstayed and in
effect for 60 consecutive days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any
similar federal or state law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
An Event of Default shall not be deemed to have occurred under
clause (3), (5) or (6) until the Trustee shall have received written notice from
the Company or any of the Holders or unless an Officer shall have knowledge of
such Event of Default. A Default under clause (4) is not an Event of Default
until the Trustee notifies the Company, or the Holders of at least 25% in
principal amount of the then outstanding Notes notify the Company and the
Trustee, of the Default and the Company does not cure the Default within 60 days
after receipt of the notice. The notice must specify the Default, demand that it
be remedied and state that the notice is a "Notice of Default."
SECTION 6.02 ACCELERATION
If an Event of Default (other than an Event of Default
specified in clauses (8) and (9) of Section 6.01 relating to the Company or any
Significant Subsidiary occurs and is continuing, the Trustee by notice to the
Company, or the Holders of at least 25% in principal amount of the then
outstanding Notes by written notice to the Company and the Trustee may declare
the unpaid principal of and any accrued interest on all the Notes to be due and
payable. Upon such declaration the principal and interest shall be due and
payable immediately. If an Event of Default specified in clause (8) or (9) of
Section 6.01 relating to the Company or any Significant Subsidiary occurs, such
an amount shall ipso facto become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Holder. The Holders
of a majority in principal amount of the then outstanding Notes by written
notice to the Trustee may rescind an acceleration and its consequences if the
rescission would not conflict with any judgment or decree and if all existing
Events of Default (except nonpayment of principal or interest that has become
due solely because of the acceleration) have been cured or waived.
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SECTION 6.03 OTHER REMEDIES
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy to collect the payment of principal, premium, if
any, and interest on the Notes or to enforce the performance of any provision of
the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Notes or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Holder of a Note in exercising any right
or remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
SECTION 6.04 WAIVER OF PAST DEFAULTS
Holders of not less than a majority in aggregate principal
amount of the then outstanding Notes by notice to the Trustee may on behalf of
the Holders of all of the Notes waive an existing Default or Event of Default
and its consequences hereunder, except a continuing Default or Event of Default
in the payment of the principal of, premium and Liquidated Damages, if any, or
interest on, the Notes (including in connection with an offer to purchase)
(provided, however, that the Holders of a majority in aggregate principal amount
of the then outstanding Notes may rescind an acceleration and its consequences,
including any related payment default that resulted from such acceleration).
Upon any such waiver, such Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereon.
SECTION 6.05 CONTROL BY MAJORITY
Holders of a majority in principal amount of the then
outstanding Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising any
trust or power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture that the Trustee determines
may be unduly prejudicial to the rights of other Holders of Notes or that may
involve the Trustee in personal liability.
SECTION 6.06 LIMITATION ON SUITS
A Holder of a Note may pursue a remedy with respect to this
Indenture or the Notes only if:
(a) the Holder of a Note gives to the Trustee written
notice of a continuing Event of Default;
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(b) the Holders of at least 25% in principal amount of
the then outstanding Notes make a written request to the Trustee to
pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and,
if requested, provide to the Trustee indemnity satisfactory to the
Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within
60 days after receipt of the request and the offer and, if requested,
the provision of indemnity; and
(e) during such 60-day period the Holders of a majority
in principal amount of the then outstanding Notes do not give the
Trustee a direction inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of another
Holder of a Note or to obtain a preference or priority over another Holder of a
Note.
SECTION 6.07 RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT
Notwithstanding any other provision of this Indenture, the
right of any Holder of a Note to receive payment of principal, premium and
Liquidated Damages, if any, and interest on the Note, on or after the respective
due dates expressed in the Note (including in connection with an offer to
purchase), or to bring suit for the enforcement of any such payment on or after
such respective dates, shall not be impaired or affected without the consent of
such Holder.
SECTION 6.08 COLLECTION SUIT BY TRUSTEE
If an Event of Default specified in Section 6.01(1) or (2)
occurs and is continuing, the Trustee is authorized to recover judgment in its
own name and as trustee of an express trust against the Company for the whole
amount of principal of, premium and Liquidated Damages, if any, and interest
remaining unpaid on the Notes and interest on overdue principal and, to the
extent lawful, interest and such further amount as shall be sufficient to cover
the costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.09 TRUSTEE MAY FILE PROOFS OF CLAIM
The Trustee is authorized to file such proofs of claim and
other papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel) and
the Holders of the Notes allowed in any judicial
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proceedings relative to the Company (or any other obligor upon the Notes), its
creditors or its property and shall be entitled and empowered to collect,
receive and distribute any money or other property payable or deliverable on any
such claims and any custodian in any such judicial proceeding is hereby
authorized by each Holder to make such payments to the Trustee, and in the event
that the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof. To
the extent that the payment of any such compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts due
the Trustee under Section 7.07 hereof out of the estate in any such proceeding,
shall be denied for any reason, payment of the same shall be secured by a Lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other properties that the Holders may be entitled to receive in
such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
SECTION 6.10 PRIORITIES
If the Trustee collects any money pursuant to this Article, it
shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts
due under Section 7.07 hereof, including payment of all compensation, expense
and liabilities incurred, and all advances made, by the Trustee and the costs
and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the
Notes for principal and Liquidated Damages, if any, and interest, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium and Liquidated Damages, if any, and
interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any
payment to Holders of Notes pursuant to this Section 6.10.
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SECTION 6.11 UNDERTAKING FOR COSTS
In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as a Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.07 hereof, or a suit by Holders of more
than 10% in principal amount of the then outstanding Notes.
ARTICLE 7
TRUSTEE
SECTION 7.01 DUTIES OF TRUSTEE
(a) If an Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and powers vested in
it by this Indenture, and use the same degree of care and skill in its exercise,
as a prudent man would exercise or use under the circumstances in the conduct of
his own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be
determined solely by the express provisions of this Indenture and the
Trustee need perform only those duties that are specifically set forth
in this Indenture and no others, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture. However, the Trustee shall examine the certificates and
opinions to determine whether or not they conform to the requirements
of this Indenture.
(c) The Trustee may not be relieved from liabilities for
its own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of
paragraph (b) of this Section;
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(ii) the Trustee shall not be liable for any
error of judgment made in good faith by an Officer, unless it is proved
that the Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect
to any action it takes or omits to take in good faith in accordance
with a direction received by it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
Sections 7.01 and 7.02.
(e) No provision of this Indenture shall require the
Trustee to expend or risk its own funds or incur any liability. The Trustee
shall be under no obligation to exercise any of its rights and powers under this
Indenture at the request of any Holders, unless such Holder shall have offered
to the Trustee security and indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall not be liable for interest on any
money received by it except as the Trustee may agree in writing with the
Company. Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by law.
SECTION 7.02 RIGHTS OF TRUSTEE
(a) In connection with the Trustee's rights and duties
under this Indenture, the Trustee may conclusively rely upon any document
believed by it to be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter stated in the
document.
(b) Before the Trustee acts or refrains from acting under
this Indenture, it may require an Officers' Certificate or an Opinion of Counsel
or both. The Trustee shall not be liable for any action it takes or omits to
take in good faith in reliance on such Officers' Certificate or Opinion of
Counsel. The Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection from liability in respect of any action taken, suffered or omitted by
it hereunder in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents
and shall not be responsible for the misconduct or negligence of any agent
appointed with due care.
(d) The Trustee shall not be liable for any action it
takes or omits to take in good faith that it believes to be authorized or within
the rights or powers conferred upon it by this Indenture.
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(e) Unless otherwise specifically provided in this
Indenture, any demand, request, direction or notice from the Company shall be
sufficient if signed by an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities that might be incurred by it in compliance with such request or
direction.
(g) Except with respect to Section 4.01 hereof, the
Trustee shall have no duty to inquire as to the performance of the Company's
covenants in Article 4 hereof. In addition, the Trustee shall not be deemed to
have knowledge of any Default or Event of Default except (i) any Event of
Default occurring pursuant to Sections 6.01(1), 6.01(2) and 4.01 or (ii) any
Default or Event of Default of which the Trustee shall have received written
notification or obtained actual knowledge.
(h) The Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee may, in its discretion, make such further inquiry or
investigation into such facts or matters as it may see fit and if the Trustee
shall determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company personally or
by agent or attorney.
SECTION 7.03 INDIVIDUAL RIGHTS OF TRUSTEE
The Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest (as defined in the TIA) it must eliminate such conflict within 90 days,
apply to the SEC for permission to continue as trustee or resign. Any Agent may
do the same with like rights and duties. The Trustee is also subject to Sections
7.10 and 7.11 hereof.
SECTION 7.04 TRUSTEE'S DISCLAIMER
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Notes, it
shall not be accountable for the Company's use of the proceeds from the Notes or
any money paid to the Company or upon the Company's direction under any
provision of this Indenture, it shall not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee,
and
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it shall not be responsible for any statement or recital herein or any
statement in the Notes or any other document in connection with the sale of the
Notes or pursuant to this Indenture other than its certificate of
authentication.
SECTION 7.05 NOTICE OF DEFAULTS
If a Default or Event of Default occurs and is continuing and
if it is known to the Trustee, the Trustee shall mail to Holders of Notes a
notice of the Default or Event of Default within 90 days after it occurs. Except
in the case of a Default or Event of Default in payment of principal of,
premium, if any, or interest on any Note, the Trustee may withhold the notice if
and so long as a committee of its Officers in good faith determines that
withholding the notice is in the interests of the Holders of the Notes.
SECTION 7.06 REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES
Within 60 days after each May 15 beginning with the May 15
following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee shall mail to the Holders of the Notes a brief report
dated as of such reporting date that complies with TIA Section 313(a) (but if no
event described in TIA Section 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
shall comply with TIA Section 313(b)(2). The Trustee shall also transmit by mail
all reports as required by TIA Section 313(c).
A copy of each report at the time of its mailing to the
Holders of Notes shall be mailed to the Company and filed with the SEC and each
stock exchange on which the Notes are listed in accordance with TIA Section
313(d). The Company shall promptly notify the Trustee when the Notes are listed
on any stock exchange.
SECTION 7.07 COMPENSATION AND INDEMNITY
The Company shall pay to the Trustee from time to time
reasonable compensation for its acceptance of this Indenture and services
hereunder. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse the
Trustee promptly upon request for all reasonable disbursements, advances and
expenses incurred or made by it in addition to the compensation for its
services. Such expenses shall include the reasonable compensation, disbursements
and expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee against any and all
losses, liabilities or expenses (including reasonable attorneys' fees) incurred
by it arising out of or in connection with the acceptance or administration of
its duties under this Indenture, including the costs and expenses of enforcing
this Indenture against the Company (including
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this Section 7.07) and defending itself against any claim (whether asserted by
the Company or any Holder or any other Person) or liability in connection with
the exercise or performance of any of its powers or duties hereunder, except to
the extent any such loss, liability or expense may be attributable to its
negligence or bad faith. The Trustee shall notify the Company promptly of any
claim for which it may seek indemnity. Failure by the Trustee to so notify the
Company shall not relieve the Company of its obligations hereunder. The Company
shall defend the claim and the Trustee shall cooperate in the defense. The
Trustee may have separate counsel and the Company shall pay the reasonable fees
and expenses of such counsel. The Company need not pay for any settlement made
without its consent, which consent shall not be unreasonably withheld.
The obligations of the Company under this Section 7.07 shall
survive the satisfaction and discharge of this Indenture.
To secure the Company's payment obligations in this Section,
the Trustee shall have a Lien prior to the Notes on all money or property held
or collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien shall survive the satisfaction and
discharge of this Indenture.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Sections 6.01(8) or 6.01(9) hereof occurs, the
expenses and the compensation for the services (including the fees and expenses
of its agents and counsel) are intended to constitute expenses of administration
under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA Section
313(b)(2) to the extent applicable.
SECTION 7.08 REPLACEMENT OF TRUSTEE
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
The Trustee may resign in writing at any time and be
discharged from the trust hereby created by so notifying the Company. The
Holders of Notes of a majority in principal amount of the then outstanding Notes
may remove the Trustee by so notifying the Trustee and the Company in writing.
The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or
an order for relief is entered with respect to the Trustee under any
Bankruptcy Law;
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(c) a Custodian or public officer takes charge of the
Trustee or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office, the
Holders of a majority in principal amount of the then outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company, or the Holders of Notes of at least 10% in principal amount of the then
outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Note
who has been a Holder of a Note for at least six months, fails to comply with
Section 7.10, su ch Holder of a Note may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders of the Notes. The retiring Trustee shall promptly transfer
all property held by it as Trustee to the successor Trustee, provided all sums
owing to the Trustee hereunder have been paid and subject to the Lien provided
for in Section 7.07 hereof. Notwithstanding replacement of the Trustee pursuant
to this Section 7.08, the Company's obligations under Section 7.07 hereof shall
continue for the benefit of the retiring Trustee.
SECTION 7.09 SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
SECTION 7.10 ELIGIBILITY; DISQUALIFICATION
There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to
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supervision or examination by federal or state authorities and that has a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to
TIA Section 310(b).
SECTION 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY
The Trustee is subject to TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE
The Company may, at the option of its Board of Directors
evidenced by a resolution set forth in an Officers' Certificate, at any time,
elect to have either Section 8.02 or 8.03 hereof be applied to all outstanding
Notes upon compliance with the conditions set forth below in this Article 8.
SECTION 8.02 LEGAL DEFEASANCE AND DISCHARGE
Upon the Company's exercise under Section 8.01 hereof of the
option applicable to this Section 8.02, the Company and the Subsidiary
Guarantors shall, subject to the satisfaction of the conditions set forth in
Section 8.04 hereof, be deemed to have been discharged from their obligations
with respect to all outstanding Notes and the Subsidiary Guarantees on the date
the conditions set forth below are satisfied (hereinafter, "Legal Defeasance").
For this purpose, Legal Defeasance means that the Company and the Subsidiary
Guarantors shall be deemed to have paid and discharged the entire Indebtedness
represented by the outstanding Notes and the Subsidiary Guarantees, which shall
thereafter be deemed to be "outstanding" only for the purposes of Section 8.05
hereof and the other Sections of this Indenture referred to in (a) and (b)
below, and to have satisfied all its other obligations under such Notes,
Subsidiary Guarantees and this Indenture (and the Trustee, on demand of and at
the expense of the Company, shall execute proper instruments acknowledging the
same), except for the following provisions which shall survive until otherwise
terminated or discharged hereunder: (a) the rights of Holders of outstanding
Notes to receive solely from the trust fund described in Section 8.04 hereof,
and as more fully set forth in such Section, payments in respect of the
principal of, premium, if any, and interest
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on such Notes when such payments are due, (b) the Company's obligations with
respect to such Notes under Article 2 and Section 4.02 hereof, (c) the rights,
powers, trusts, duties and immunities of the Trustee hereunder and the Company's
obligations in connection therewith and (d) this Article Eight. Subject to
compliance with this Article Eight, the Company may exercise its option under
this Section 8.02 notwithstanding the prior exercise of its option under Section
8.03 hereof.
SECTION 8.03 COVENANT DEFEASANCE
Upon the Company's exercise under Section 8.01 hereof of the
option applicable to this Section 8.03, the Company and the Subsidiary
Guarantors shall, subject to the satisfaction of the conditions set forth in
Section 8.04 hereof, be released from their obligations under the covenants
contained in Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 5.01
and 10.03 hereof with respect to the outstanding Notes on and after the date the
conditions set forth below are satisfied (hereinafter, "Covenant Defeasance"),
and the Notes shall thereafter be deemed not "outstanding" for the purposes of
any direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes, the Company and the Subsidiary Guarantors may omit to comply
with and shall have no liability in respect of any term, condition or limitation
set forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference in
any such covenant to any other provision herein or in any other document and
such omission to comply shall not constitute a Default or an Event of Default
under Section 6.01 hereof, but, except as specified above, the remainder of this
Indenture and such Notes shall be unaffected thereby. In addition, upon the
Company's exercise under Section 8.01 hereof of the option applicable to this
Section 8.03 hereof, subject to the satisfaction of the conditions set forth in
Section 8.04 hereof, Sections 6.01(5) through 6.01(7) hereof shall not
constitute Events of Default.
SECTION 8.04 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE
The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant
Defeasance, (i) the Company must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders of the Notes, cash in U.S. dollars, non-callable
Government Securities, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of independent public
accountants, to pay the principal of, premium, if any, and interest and
Liquidated Damages, if any, on the outstanding Notes on the stated maturity or
on the
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applicable redemption date, as the case may be, and the Company must specify
whether the Notes are being defeased to maturity or to a particular redemption
date; (ii) in the case of Legal Defeasance, the Company shall have delivered to
the Trustee an Opinion of Counsel in the United States reasonably acceptable to
the Trustee confirming that (A) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling or (B) since the date of
this Indenture, there has been a change in the applicable federal income tax
law, in either case to the effect that, and based thereon such Opinion of
Counsel shall confirm that, the Holders of the outstanding Notes will not
recognize income, gain or loss for federal income tax purposes as a result of
such Legal Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been the case if
such Legal Defeasance had not occurred; (iii) in the case of Covenant
Defeasance, the Company shall have delivered to the Trustee an Opinion of
Counsel in the United States reasonably acceptable to the Trustee confirming
that the Holders of the outstanding Notes will not recognize income, gain or
loss for federal income tax purposes as a result of such Covenant Defeasance and
will be subject to federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such Covenant Defeasance
had not occurred; (iv) no Default or an Event of Default shall have occurred and
be continuing on the date of such deposit (other than a Default or Event of
Default resulting from the borrowing of funds to be applied to such deposit) or
insofar as Events of Default from bankruptcy or insolvency events are concerned,
at any time in the period ending on the 91st day after the date of deposit; (v)
such Legal Defeasance or Covenant Defeasance will not result in a breach or
violation of, or constitute a default under any material agreement or instrument
(other than this Indenture) to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries is bound; (vi) the
Company must deliver to the Trustee an Officers' Certificate stating that the
deposit was not made by the Company with the intent of preferring the Holders of
Notes over the other creditors of the Company with the intent of defeating,
hindering, delaying or defrauding creditors of the Company or others; and (vii)
the Company must deliver to the Trustee an Officers' Certificate and an Opinion
of Counsel, in the case of the Officers' Certificate stating that all conditions
precedent provided for in clauses (i)-(vi) have been complied with, and, in the
case of the Opinion of Counsel, that the conditions precedent provided for in
clauses (ii), (iii) and (v) have been complied with.
SECTION 8.05 DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN
TRUST; OTHER MISCELLANEOUS PROVISIONS
Subject to Section 8.06 hereof, all money and non-callable
Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section
8.05, the "Trustee") pursuant to Section 8.04 hereof in respect of the
outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including the Company acting as
Paying Agent) as the
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Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest, but
such money need not be segregated from other funds except to the extent required
by law.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 8.04 hereof or the principal
and interest received in respect thereof.
Anything in this Article 8 to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon the
request of the Company any money or non-callable Government Securities held by
it as provided in Section 8.04 hereof which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee (which may be the opinion
delivered under Section 8.04(a) hereof), are in excess of the amount thereof
that would then be required to be deposited to effect an equivalent Legal
Defeasance or Covenant Defeasance.
SECTION 8.06 REPAYMENT TO COMPANY
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of, premium,
if any, Liquidated Damages or interest on any Note and remaining unclaimed for
two years after such principal, and premium, if any, Liquidated Damages, if any,
or interest has become due and payable shall be paid to the Company on its
request or (if then held by the Company) shall be discharged from such trust;
and the Holder of such Note shall thereafter, as a creditor, look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in the New York Times and The
Wall Street Journal (national edition), notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such notification or publication, any unclaimed balance of such
money then remaining will be repaid to the Company.
SECTION 8.07 REINSTATEMENT
If the Trustee or Paying Agent is unable to apply any United
States dollars or non-callable Government Securities in accordance with Section
8.02 or 8.03 hereof, as the case may be, by reason of any order or judgment of
any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the Company's obligations under this
Indenture and the Notes shall be revived and reinstated from and after such
occurrence as though no deposit had occurred pursuant to Section 8.02 or 8.03
hereof
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until such time as the Trustee or Paying Agent is permitted to apply all such
money in accordance with Section 8.02 or 8.03 hereof, as the case may be;
provided, however, that, if the Company makes any payment of principal of,
premium, if any, or interest on any Note following the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money held by the Trustee or Paying
Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01 WITHOUT CONSENT OF HOLDERS OF NOTES
Notwithstanding Section 9.02 of this Indenture, the Company,
the Subsidiary Guarantors and the Trustee may amend or supplement this
Indenture, the Subsidiary Guarantees or the Notes without the consent of any
Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or
in place of certificated Notes;
(c) to provide for the assumption of the Company's
obligations to the Holders of the Notes in the case of a merger or
consolidation pursuant to Article Five hereof;
(d) to provide for additional Subsidiary Guarantors as
set forth in Section 4.15 or for the release or assumption of a
Subsidiary Guarantee in compliance with this Indenture;
(e) to make any change that would provide any additional
rights or benefits to the Holders of the Notes or that does not
adversely affect the legal rights hereunder of any Holder of the Note;
or
(f) to comply with requirements of the SEC in order to
effect or maintain the qualification of this Indenture under the TIA.
Upon the request of the Company accompanied by a resolution of
its Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon receipt by the Trustee of the documents
described in Section 7.02 hereof, the Trustee shall join with the Company in the
execution of any amended or supplemental Indenture authorized or permitted by
the terms of this Indenture and to make any further appropriate
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agreements and stipulations that may be therein contained, but the Trustee shall
not be obligated to enter into such amended or supplemental Indenture that
affects its own rights, duties or immunities under this Indenture or otherwise.
SECTION 9.02 WITH CONSENT OF HOLDERS OF NOTES
Except as provided below in this Section 9.02, the Company and
the Trustee may amend or supplement this Indenture (including Sections 4.07 and
4.08 hereof) and the Notes may be amended or supplemented with the consent of
the Holders of at least a majority in principal amount of the Notes then
outstanding (including consents obtained in connection with a tender offer or
exchange offer for the Notes), and, subject to Sections 6.04 and 6.07 hereof,
any existing Default or Event of Default (other than a Default or Event of
Default in the payment of the principal of, premium, if any, or interest on the
Notes, except a payment default resulting from an acceleration that has been
rescinded) or compliance with any provision of this Indenture or the Notes may
be waived with the consent of the Holders of a majority in principal amount of
the then outstanding Notes (including consents obtained in connection with a
tender offer or exchange offer for the Notes).
Upon the request of the Company accompanied by a resolution of
its Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid,
and upon receipt by the Trustee of the documents described in Section 7.02
hereof, the Trustee shall join with the Company in the execution of such amended
or supplemental Indenture unless such amended or supplemental Indenture affects
the Trustee's own rights, duties or immunities under this Indenture or
otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of
Notes under this Section 9.02 to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section
becomes effective, the Company shall mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such amended or
supplemental Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the
Holders of a majority in aggregate principal amount of the Notes then
outstanding may waive compliance in a particular instance by the Company with
any provision of this Indenture or the Notes. However, without the consent of
each Holder affected, an amendment or waiver may not (with respect to any Notes
held by a non-consenting Holder):
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(a) reduce the principal amount of Notes whose
Holders must consent to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed
maturity of any Note or alter or waive any of the provisions
with respect to the redemption of the Notes, except as
provided above with respect to Sections 4.07 and 4.08 hereof;
(c) reduce the rate of or change the time for
payment of interest, including default interest, on any Note;
(d) waive a Default or Event of Default in the
payment of principal of or premium, if any, or interest on the
Notes (except a rescission of acceleration of the Notes by the
Holders of at least a majority in aggregate principal amount
of the then outstanding Notes and a waiver of the payment
default that resulted from such acceleration);
(e) make any Note payable in money other than
that stated in the Notes;
(f) make any change in the provisions of this
Indenture relating to waivers of past Defaults or the rights
of Holders of Notes to receive payments of principal of,
premium or Liquidated Damages, if any, or interest on the
Notes;
(g) waive a redemption payment with respect to
any Note (other than a payment required by Sections 4.07 or
4.08 hereof); or
(h) make any change in Section 6.04 or 6.07
hereof or in the foregoing amendment and waiver provisions.
SECTION 9.03 COMPLIANCE WITH TRUST INDENTURE ACT
Every amendment or supplement to this Indenture or the Notes
shall be set forth in a amended or supplemental Indenture that complies with the
TIA as then in effect.
SECTION 9.04 REVOCATION AND EFFECT OF CONSENTS
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by the Holder of a
Note and every subsequent Holder of a Note or portion of a Note that evidences
the same debt as the consenting Holder's Note, even if notation of the consent
is not made on any Note. However, any such Holder
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of a Note or subsequent Holder of a Note may revoke the consent as to its Note
if the Trustee receives written notice of revocation before the date the waiver,
supplement or amendment becomes effective. An amendment, supplement or waiver
becomes effective in accordance with its terms and thereafter binds every
Holder.
SECTION 9.05 NOTATION ON OR EXCHANGE OF NOTES
The Trustee may place an appropriate notation about an
amendment, supplement or waiver on any Note thereafter authenticated. The
Company in exchange for all Notes may issue and the Trustee shall authenticate
new Notes that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Note
shall not affect the validity and effect of such amendment, supplement or
waiver.
SECTION 9.06 TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article Nine if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
In executing any amended or supplemental indenture, the Trustee shall be
entitled to receive indemnity reasonably satisfactory to it and to receive and
(subject to Section 7.01) shall be fully protected in relying upon, an Officer's
Certificate and an Opinion of Counsel stating that the execution of such amended
or supplemental indenture is authorized or permitted by this Indenture.
ARTICLE 10
SUBSIDIARY GUARANTEES
SECTION 10.01 SUBSIDIARY GUARANTEES
Subject to the provisions of this Article 10, each Subsidiary
Guarantor, jointly and severally, hereby unconditionally guarantees to each
Holder of a Note authenticated and delivered by the Trustee and to the Trustee
and its successors and assigns, that: (a) the principal of, and premium and
interest and Liquidated Damages, if any, on the Notes shall be duly and
punctually paid in full when due, whether at maturity, by acceleration or
otherwise, and interest on overdue principal, and premium, if any, and (to the
extent permitted by law) interest on any interest, if any, on the Notes and all
other obligations of the Company to the Holders or the Trustee hereunder or
under the Notes (including fees, expenses or other) shall be promptly paid in
full or performed, all in accordance with the terms hereof; and (b) in case of
any extension of time of payment or renewal of any Notes or any of such other
obligations, the same shall be promptly paid in full when due or
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performed in accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise (collectively, the "Guarantee
Obligations"). Failing payment when due of any Guarantee Obligation or failing
performance of any other obligation of the Company to the Holders, for whatever
reason, each Subsidiary Guarantor shall be obligated to pay, or to perform or to
cause the performance of, the same immediately. An Event of Default under this
Indenture or the Notes shall constitute an event of default under this
Subsidiary Guarantee, and shall entitle the Trustee or the Holders of Notes to
accelerate the Guarantee Obligations of each Subsidiary Guarantor hereunder in
the same manner and to the same extent as the Obligations of the Company. Each
Subsidiary Guarantor hereby agrees that its Guarantee Obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Notes or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Notes with respect
to any thereof, the entry of any judgment against the Company, any action to
enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a Subsidiary Guarantor. Each
Subsidiary Guarantor hereby waives and relinquishes: (a) any right to require
the Trustee, the Holders or the Company (each, a "Benefitted Party") to proceed
against the Company, the Subsidiaries or any other Person or to proceed against
or exhaust any security held by a Benefitted Party at any time or to pursue any
other remedy in any secured party's power before proceeding against the
Subsidiary Guarantors; (b) any defense that may arise by reason of the
incapacity, lack of authority, death or disability of any other Person or
Persons or the failure of a Benefitted Party to file or enforce a claim against
the estate (in administration, bankruptcy or any other proceeding) of any other
Person or Persons; (c) demand, protest and notice of any kind (except as
expressly required by this Indenture), including but not limited to notice of
the existence, creation or incurring of any new or additional Indebtedness or
obligation or of any action or non-action on the part of the Subsidiary
Guarantors, the Company, the Subsidiaries, any Benefitted Party, any creditor of
the Subsidiary Guarantors, the Company or the Subsidiaries or on the part of any
other Person whomsoever in connection with any obligations the performance of
which are hereby guaranteed; (d) any defense based upon an election of remedies
by a Benefitted Party, including but not limited to an election to proceed
against the Subsidiary Guarantors for reimbursement; (e) any defense based upon
any statute or rule of law which provides that the obligation of a surety must
be neither larger in amount nor in other respects more burdensome than that of
the principal; (f) any defense arising because of a Benefitted Party's election,
in any proceeding instituted under the Bankruptcy Law, of the application of
Section 1111(b)(2) of the Bankruptcy Code; and (g) any defense based on any
borrowing or grant of a security interest under Section 364 of the Bankruptcy
Code. The Subsidiary Guarantors hereby covenant that, except as otherwise
provided therein, the Subsidiary Guarantees shall not be discharged except by
payment in full of all Guarantee Obligations, including the principal, premium,
if any, and interest on the Notes and all other costs provided for under this
Indenture or as provided in Section 8.01.
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81
If any Holder or the Trustee is required by any court or
otherwise to return to either the Company or the Subsidiary Guarantors, or any
trustee or similar official acting in relation to either the Company or the
Subsidiary Guarantors, any amount paid by the Company or the Subsidiary
Guarantors to the Trustee or such Holder, the Subsidiary Guarantees, to the
extent theretofore discharged, shall be reinstated in full force and effect.
Each of the Subsidiary Guarantors agrees that it shall not be entitled to any
right of subrogation in relation to the Holders in respect of any Guarantee
Obligations hereby until payment in full of all such obligations. Each
Subsidiary Guarantor agrees that, as between it, on the one hand, and the
Holders of Notes and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 hereof
for the purposes hereof, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the Guarantee
Obligations, and (y) in the event of any acceleration of such obligations as
provided in Article 6 hereof, such Guarantee Obligations (whether or not due and
payable) shall forthwith become due and payable by such Subsidiary Guarantor for
the purpose of the Subsidiary Guarantee.
SECTION 10.02 EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEES
To evidence the Subsidiary Guarantees set forth in Section
10.01 hereof, each of the Subsidiary Guarantors agrees that a notation of the
Subsidiary Guarantees substantially in the form included in Exhibit A hereto
shall be endorsed on each Note authenticated and delivered by the Trustee and
that this Indenture shall be executed on behalf of the Subsidiary Guarantors by
the Chairman of the Board, any Vice Chairman, the President or one of the Vice
Presidents of the Subsidiary Guarantors, under a facsimile of its seal
reproduced on this Indenture and attested to by an Officer other than the
Officer executing this Indenture.
Each of the Subsidiary Guarantors agree that the Subsidiary
Guarantees set forth in this Article 10 will remain in full force and effect and
apply to all the Notes notwithstanding any failure to endorse on each Note a
notation of the Subsidiary Guarantees.
If an Officer whose facsimile signature is on a Note no longer
holds that office at the time the Trustee authenticates the Note on which the
Subsidiary Guarantees are endorsed, the Subsidiary Guarantees shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the
Subsidiary Guarantees set forth in this Indenture on behalf of the Subsidiary
Guarantors.
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SECTION 10.03 SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN
TERMS
(a) Nothing contained in this Indenture or in the Notes
shall prevent any consolidation or merger of a Subsidiary Guarantor with or into
the Company or another Subsidiary Guarantor, or shall prevent the transfer of
all or substantially all of the assets of a Subsidiary Guarantor to the Company
or another Subsidiary Guarantor. Upon any such consolidation, merger, transfer
or sale, the Subsidiary Guarantee of such Subsidiary Guarantor shall no longer
have any force or effect.
(b) Except for a merger or consolidation in which a
Subsidiary Guarantor is sold and its Subsidiary Guarantee is released in
compliance with the provisions of Section 10.04, no Subsidiary Guarantor shall,
in a single transaction or series of related transactions, consolidate or merge
with or into (whether or not such Subsidiary Guarantor is the surviving
corporation), or sell, assign, transfer, lease, convey or otherwise dispose of
all or substantially all of its properties or assets in one or more related
transactions, to another corporation, Person or entity other than the Company or
another Subsidiary Guarantor unless (i) the entity or Person formed by or
surviving any such consolidation or merger (if other than such Subsidiary
Guarantor) or the entity or Person to which such sale, assignment, transfer,
lease, conveyance or other disposition shall have been made assumes all the
Guarantee Obligations of such Subsidiary Guarantor under its Subsidiary
Guarantee and this Indenture pursuant to a supplemental indenture in form and
substance reasonably satisfactory to the Trustee; (ii) immediately after such
transaction no Default or Event of Default exists; (iii) unless such merger or
consolidation involves only Restricted Subsidiaries and the surviving Person is
a Subsidiary Guarantor, the Company would be able to, at the time of such
transaction and after giving pro forma effect thereto as if such transaction had
occurred at the beginning of the applicable four-quarter period, be permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge
Coverage Ratio test set forth in the first paragraph of Section 4.10; and (iv)
such Subsidiary Guarantor shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel addressed to the Trustee, each stating
that such consolidation, merger, sale, assignment, transfer, lease, conveyance
or disposition and such supplemental indenture, if any, comply with this
Indenture and that such supplemental indenture is enforceable. In case of any
such consolidation, merger or transfer of assets and upon the assumption by the
successor corporation, by supplemental indenture, executed and delivered to the
Trustee and satisfactory in form to the Trustee, of the Subsidiary Guarantees
endorsed upon the Notes and the due and punctual performance of all of the
covenants and conditions of this Indenture to be performed by such Guarantor,
such successor corporation shall succeed to and be substituted for such
Subsidiary Guarantor with the same effect as if it had been named herein as a
Subsidiary Guarantor. Such successor corporation thereupon may cause to be
signed any or all of the Subsidiary Guarantees to be endorsed upon all of the
Notes issuable hereunder which theretofore shall not have been signed by the
Company and delivered to the Trustee. All the Subsidiary Guarantees so issued
shall in all respects have the same legal rank and benefit under this Indenture
as the Subsidiary Guarantees theretofore and thereafter issued in accordance
with the terms of this
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Indenture as though all of such Subsidiary Guarantees had been issued at the
date of the execution hereof.
(c) The Trustee, subject to the provisions of Section
10.04 hereof, shall be entitled to receive an Officers' Certificate and an
Opinion of Counsel as conclusive evidence that any such consolidation, merger,
sale or conveyance, and any such assumption of Guarantee Obligations, comply
with the provisions of this Section 10.03. Such Officers' Certificate and
Opinion of Counsel shall comply with the provisions of Section 10.05.
SECTION 10.04 RELEASES
Notwithstanding Section 10.03, in the event of (a) a sale or
other disposition of all or substantially all of the assets of any Subsidiary
Guarantor, by way of merger, consolidation or otherwise, or a sale or other
disposition of all (or substantially all) of the Capital Stock of any Subsidiary
Guarantor, or (b) a designation of a Subsidiary Guarantor as an Unrestricted
Subsidiary, which sale or other disposition or which designation otherwise
complies with the terms of this Indenture, then such Subsidiary Guarantor (in
the event of a sale or other disposition, by way of such a merger, consolidation
or otherwise, of all or substantially all of the Capital Stock of such
Subsidiary Guarantor or in the event of a designation of such Subsidiary
Guarantor as an Unrestricted Subsidiary) or the corporation acquiring the
property (in the event of a sale or other disposition of all or substantially
all of the assets of such Subsidiary Guarantor) shall be released from and
relieved of any Guarantee Obligations under its Subsidiary Guarantee; provided
that the Net Proceeds from such sale or other disposition are applied in
accordance with the provisions of Section 4.08 hereof. Upon delivery by the
Company to the Trustee of an Officer's Certificate and Opinion of Counsel, to
the effect that such sale or other disposition or that such designation was made
by the Company in accordance with the provisions of this Indenture, including
without limitation Sections 4.08 or 4.09 hereof, as applicable, the Trustee
shall execute any documents reasonably required in order to evidence the release
of any such Subsidiary Guarantor from its Guarantee Obligations under its
Subsidiary Guarantee. Any Subsidiary Guarantor not released from its Guarantee
Obligations under its Subsidiary Guarantee shall remain liable for the full
amount of principal of and interest on the Notes and for the other obligations
of any Subsidiary Guarantor under this Indenture as provided in this Article 10.
SECTION 10.05 LIMITATION OF SUBSIDIARY GUARANTOR'S LIABILITY
Each Subsidiary Guarantor, and by its acceptance hereof each
Holder, hereby confirms that it is the intention of all such parties that the
Guarantee by such Subsidiary Guarantor pursuant to its Subsidiary Guarantee not
constitute a fraudulent transfer or conveyance for purposes of any Bankruptcy
Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act
or any similar federal or state law. To effectuate the foregoing intention, the
Holders and such Subsidiary Guarantor hereby irrevocably agree
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that the Guarantee Obligations of such Subsidiary Guarantor under this Article
10 shall be limited to the maximum amount as will, after giving effect to all
other contingent and fixed liabilities of such Subsidiary Guarantor and after
giving effect to any collections from or payments made by or on behalf of any
other Subsidiary Guarantor in respect of the Guarantee Obligations of such other
Subsidiary Guarantor under this Article 10, result in the Guarantee Obligations
of such Subsidiary Guarantor under the Subsidiary Guarantee of such Subsidiary
Guarantor not constituting a fraudulent transfer or conveyance.
SECTION 10.06 APPLICATION OF CERTAIN TERMS AND PROVISIONS TO THE SUBSIDIARY
GUARANTORS
(a) For purposes of any provision of this Indenture which
provides for the delivery by any Subsidiary Guarantor of an Officers'
Certificate and/or an Opinion of Counsel, the definitions of such terms in
Section 1.01 shall apply to such Subsidiary Guarantor as if references therein
to the Company were references to such Subsidiary Guarantor.
(b) Any request, direction, order or demand which by any
provision of this Indenture is to be made by any Subsidiary Guarantor, shall be
sufficient if evidenced as described in Section 11.02 as if references therein
to the Company were references to such Subsidiary Guarantor.
(c) Any notice or demand which by any provision of this
Indenture is required or permitted to be given or served by the Trustee or by
the holders of Notes to or on any Subsidiary Guarantor may be given or served as
described in Section 11.02 as if references therein to the Company were
references to such Subsidiary Guarantor.
(d) Upon any demand, request or application by any
Subsidiary Guarantor to the Trustee to take any action under this Indenture,
such Subsidiary Guarantor shall furnish to the Trustee such certificates and
opinions as are required in Section 11.04 hereof as if all references therein to
the Company were references to such Subsidiary Guarantor.
ARTICLE 11
MISCELLANEOUS
SECTION 11.01 TRUST INDENTURE ACT CONTROLS
If any provision of this Indenture limits, qualifies or
conflicts with the duties imposed by TIA Section 318(c), the imposed duties
shall control.
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SECTION 11.02 NOTICES
Any notice or communication by the Company or the Trustee to
the others is duly given if in writing and delivered in Person or mailed by
first class mail (registered or certified, return receipt requested), telex,
telecopier or overnight air courier guaranteeing next day delivery, to the
others' address:
If to the Company:
Medaphis Corporation
2700 Cumberland Parkway, Suite 300
Atlanta, Georgia 30339
Attention: General Counsel
Telephone No.: (770) 444-5300
Telecopier No.: (703) 444-4502
If to the Trustee:
State Street Bank and Trust Company
225 Asylum Street
Goodwin Square
Hartford, Connecticut 06103
Telephone No.: (860) 244-1820
Telecopier No.: (860) 244-1889
Attention: Corporate Trust Department
The Company or the Trustee, by notice to the others may
designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to
Holders) shall be deemed to have been duly given: at the time delivered by hand,
if personally delivered; when answered back, if telexed; when receipt
acknowledged, if telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by
first class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next day delivery to its address shown on the
register kept by the Registrar. Any notice or communication shall also be so
mailed to any Person described in TIA Section 313(c), to the extent
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required by the TIA. Failure to mail a notice or communication to a Holder or
any defect in it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided
above within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it
shall mail a copy to the Trustee and each Agent at the same time.
SECTION 11.03 COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF
NOTES
Holders may communicate pursuant to TIA Section 312(b) with
other Holders with respect to their rights under this Indenture or the Notes.
The Company, the Trustee, the Registrar and anyone else shall have the
protection of TIA Section 312(c).
SECTION 11.04 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT
Upon any request or application by the Company to the Trustee
to take any action under this Indenture, the Company shall furnish to the
Trustee:
(a) an Officers' Certificate in form and substance
reasonably satisfactory to the Trustee (which shall include the
statements set forth in Section 11.05 hereof) stating that, in the
opinion of the signers, all conditions precedent and covenants, if any,
provided for in this Indenture relating to the proposed action have
been satisfied; and
(b) an Opinion of Counsel in form and substance
reasonably satisfactory to the Trustee (which shall include the
statements set forth in Section 11.05 hereof) stating that, in the
opinion of such counsel, all such conditions precedent and covenants
have been satisfied.
SECTION 11.05 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA Section 314(a)(4)) shall comply with the provisions of
TIA Section 314(e) and shall include:
(a) a statement that the Person making such certificate
or opinion has read such covenant or condition;
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(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he
or she has made such examination or investigation as is necessary to
enable him to express an informed opinion as to whether or not such
covenant or condition has been satisfied; and
(d) a statement as to whether or not, in the opinion of
such Person, such condition or covenant has been satisfied.
SECTION 11.06 RULES BY TRUSTEE AND AGENTS
The Trustee may make reasonable rules for action by or at a
meeting of Holders. The Registrar or Paying Agent may make reasonable rules and
set reasonable requirements for its functions.
SECTION 11.07 NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
STOCKHOLDERS
No past, present or future director, officer, employee,
incorporator or stockholder of the Company or the Subsidiary Guarantors, as
such, shall have any liability for any Obligations of the Company or the
Subsidiary Guarantors under the Notes, the Subsidiary Guarantees or this
Indenture or for any claim based on, in respect of, or by reason of, such
Obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes.
SECTION 11.08 GOVERNING LAW
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE
USED TO CONSTRUE THIS INDENTURE, THE NOTES AND THE SUBSIDIARY GUARANTEES.
SECTION 11.09 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS
This Indenture may not be used to interpret any other
indenture, loan or debt agreement of the Company or its Subsidiaries or of any
other Person. Any such indenture, loan or debt agreement may not be used to
interpret this Indenture.
<PAGE> 93
88
SECTION 11.10 SUCCESSORS
All agreements of the Company in this Indenture and the Notes
shall bind its successors. All agreements of the Trustee in this Indenture shall
bind its successors.
SECTION 11.11 SEVERABILITY
In case any provision in this Indenture or in the Notes shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
SECTION 11.12 COUNTERPART ORIGINALS
The parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together represent the
same agreement.
SECTION 11.13 TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part of this Indenture and shall
in no way modify or restrict any of the terms or provisions hereof.
[Signatures on following pages]
<PAGE> 94
SIGNATURES
Dated as of February 20, 1998 MEDAPHIS CORPORATION
By:
--------------------------------
Name:
Title:
Attest:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 MEDAPHIS PHYSICIAN SERVICES
CORPORATION
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 GOTTLIEB'S FINANCIAL SERVICES, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 MEDICAL MANAGEMENT SCIENCES, INC.
<PAGE> 95
90
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 MEDAPHIS SERVICES CORPORATION
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 MEDAPHIS HEALTHCARE INFORMATION
TECHNOLOGY COMPANY
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
<PAGE> 96
Dated as of February 20, 1998 AUTOMATION ATWORK
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 CONSORT TECHNOLOGIES, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 HEALTH DATA SCIENCES CORPORATION
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
<PAGE> 97
92
Dated as of February 20, 1998 BSG CORPORATION
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 ASSETCARE, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 NATIONAL HEALTHCARE
TECHNOLOGIES, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
<PAGE> 98
Dated as of February 20, 1998 BSG ALLIANCE/IT, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 BSG GOVERNMENT SOLUTIONS, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
<PAGE> 99
Dated as of February 20, 1998 STATE STREET BANK AND TRUST
COMPANY
By:
--------------------------------
Name: Michael Hopkins
Title: Vice President
<PAGE> 100
EXHIBIT A-1
(Face of Note)
CUSIP No:[144a 584 028 AB0 (144A)]
[U58220AA9 (Reg. S)]
[ISIN USU 582 20 AA94]
9 1/2% [Series A] [Series B] Senior Notes due 2005
No. $__________
MEDAPHIS CORPORATION
promises to pay to or registered assigns,
the principal sum of Dollars on February 15, 2005
Interest Payment Dates: February 15 and August 15
Record Dates: February 1 and August 1
Dated:
A-1-1
<PAGE> 101
MEDAPHIS CORPORATION
By:
--------------------------------
Name:
Title:
By:
--------------------------------
Name:
Title:
(SEAL)
Certificate of Authentication:
This is one of the Global Notes
referred to in the within-mentioned Indenture:
State Street Bank and Trust Company
By:
------------------------------
Authorized Signatory
Dated:
A-1-2
<PAGE> 102
(Back of Note)
9 1/2% [Series A] [Series B] Senior Notes due 2005
[THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE,
(III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO
A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.]
[UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.](1)
[THIS NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND, ACCORDINGLY, MAY
NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES
OR TO, OR FOR THE ACCOUNT OR
- --------------------
(1) To be included only on Global Notes deposited with DTC as Depositary.
A-1-3
<PAGE> 103
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER (1) REPRESENTS
THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER
THE SECURITIES ACT) (A "QIB"), (B) IT IS ACQUIRING THIS NOTE IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT OR (C) IT
IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(A)(1), (2),
(3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT) (AN "IAI"), (2) AGREES THAT
IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY OR
ANY OF ITS SUBSIDIARIES, (B) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS
A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE
TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR 904 UNDER THE SECURITIES
ACT, (D) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE
SECURITIES ACT, (E) TO AN IAI THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE
TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE REGISTRATION OF TRANSFER OF THIS NOTE (THE FORM OF WHICH LETTER
CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN
AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS THAN $250,000, AN OPINION OF COUNSEL
ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT, (F) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL
ACCEPTABLE TO THE COMPANY) OR (G) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND (3)
AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN INTEREST
HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS
USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES" HAVE THE
MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT. THE
INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY
TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING.]
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. Interest. Medaphis Corporation, a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Note at 9
1/2% per annum from
A-1-4
<PAGE> 104
February 20, 1998 until maturity and shall pay the Liquidated Damages, if any,
payable pursuant to Section 5 of the Registration Rights Agreement referred to
below. The Company will pay interest and Liquidated Damages, if any,
semi-annually on February 15 and August 15 of each year, or if any such day is
not a Business Day, on the next succeeding Business Day (each an "Interest
Payment Date"). Interest on the Notes will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the date of
issuance; provided that if there is no existing Default in the payment of
interest, and if this Note is authenticated between a record date referred to on
the face hereof and the next succeeding Interest Payment Date, interest shall
accrue from such next succeeding Interest Payment Date; provided, further, that
the first Interest Payment Date shall be August 15, 1998. The Company shall pay
interest (including Accrued Bankruptcy Interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand at the rate then in effect; it shall pay interest (including Accrued
Bankruptcy Interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest and Liquidated Damages (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
2. Method of Payment. The Company will pay interest on the Notes
(except defaulted interest) and Liquidated Damages to the Persons who are
registered Holders of Notes at the close of business on the February 1 or August
1 next preceding the Interest Payment Date, even if such Notes are cancelled
after such record date and on or before such Interest Payment Date, except as
provided in Section 2.12 of the Indenture (as defined below) with respect to
defaulted interest. The Notes will be payable as to principal, premium, interest
and Liquidated Damages at the office or agency of the Company maintained for
such purpose within or without the City and State of New York, or, at the option
of the Company, payment of interest and Liquidated Damages may be made by check
mailed to the Holders at their addresses set forth in the register of Holders,
and provided that payment by wire transfer of immediately available funds will
be required with respect to principal of and interest, premium and Liquidated
Damages on all Global Notes and all other Notes the Holders of which shall have
provided wire transfer instructions to the Company or the Paying Agent. Such
payment shall be in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts.
3. Paying Agent and Registrar. Initially, State Street Bank and Trust
Company, the Trustee under the Indenture, will act as Paying Agent and
Registrar. The Company may change any Paying Agent or Registrar without notice
to any Holder. The Company or any of its Subsidiaries may act in any such
capacity.
4. Indenture. The Company issued the Notes under an Indenture dated as
of February 20, 1998 ("Indenture") among the Company, the Subsidiary Guarantors
and the Trustee. The terms of the Notes include those stated in the Indenture
and those made part of
A-1-5
<PAGE> 105
the Indenture by reference to the Trust Indenture Act of 1939, as amended (15
U.S. Code Sections 77aaa-77bbbb). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms. The Notes are unsecured obligations of the Company limited to
$175,000,000 in aggregate principal amount.
5. Optional Redemption.
Except as set forth below, the Notes will not be redeemable at
the Company's option prior to February 15, 2002. Thereafter, the Notes will be
subject to redemption at any time at the option of the Company, in whole or in
part, upon not less than 30 or more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
applicable redemption date, if redeemed during the twelve-month period beginning
on February 15 of the years indicated below:
<TABLE>
YEAR PERCENTAGE
<S> <C>
2002...........................................104.750%
2003...........................................102.375%
2004 and thereafter............................100.000%
</TABLE>
Notwithstanding the foregoing, at any time or from time to
time on or prior to February 15, 2001, the Company may redeem up to 35% of the
aggregate principal amount of Notes originally issued under the Indenture at a
redemption price of 109.500% of the principal amount thereof, plus accrued and
unpaid interest and Liquidated Damages thereon, if any, to the redemption date,
with the net cash proceeds of one or more Equity Offerings; provided that at
least $100,000,000 in aggregate principal amount of Notes remain outstanding
immediately after the occurrence of such redemption; and provided, further, that
such redemption shall occur within 90 days of the date of the closing of such
Equity Offering.
6. Mandatory Redemption.
The Company shall not be required to make mandatory redemption payments
with respect to the Notes.
7. Repurchase Offers.
(a) Change of Control Offer. Upon the occurrence of a Change
of Control, each Holder of Notes will have the right to require the Company to
repurchase all or any part (equal to $1,000 or an integral multiple thereof) of
such Holder's Notes pursuant to the offer described below (the "Change of
Control Offer") at an offer price in cash equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest and Liquidated
A-1-6
<PAGE> 106
Damages, if any, thereon to the date of purchase (the "Change of Control
Payment"). Within 15 Business Days following any Change of Control, the Company
will mail a notice to each Holder describing the transaction or transactions
that constitute the Change of Control and offering to repurchase Notes on the
date specified in such notice, which date shall be no earlier than 30 days and
no later than 60 days from the date such notice is mailed (the "Change of
Control Payment Date"), pursuant to the procedures required by the Indenture and
described in such notice. The Company will comply with the requirements of Rule
14e-1 under the Exchange Act and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable in connection
with the repurchase of the Notes as a result of a Change of Control. To the
extent that any applicable securities laws or regulations conflict with the
terms hereof, the Company shall comply with such laws or regulations and shall
not be deemed to have breached its obligations under the Indenture or Notes by
virtue thereof.
(b) Asset Sale Offer. The Indenture provides that the Company
will not, and will not permit any of its Restricted Subsidiaries to, consummate
an Asset Sale unless (i) the Company (or the Restricted Subsidiary, as the case
may be) receives consideration at the time of such Asset Sale at least equal to
the fair market value (evidenced by a resolution of the Board of Directors set
forth in an Officers' Certificate delivered to the Trustee in the case of any
Asset Sale for which the Company or any of its Restricted Subsidiaries receives
consideration in excess of $15,000,000) of the assets or Equity Interests issued
or sold or otherwise disposed of and (ii) at least 80% of the consideration
therefor received by the Company or such Restricted Subsidiary is in the form of
cash or Cash Equivalents; provided that the amount of (x) any liabilities (as
shown on the Company's or such Restricted Subsidiary's most recent balance
sheet), of the Company or any Restricted Subsidiary (other than contingent
liabilities and liabilities that are by their terms subordinated to the Notes or
any guarantee thereof) that are assumed by the transferee of any such assets
pursuant to a customary novation or other agreement that releases the Company or
such Restricted Subsidiary from further liability and (y) any securities, notes
or other obligations received by the Company or any such Restricted Subsidiary
from such transferee that are converted by the Company or such Restricted
Subsidiary within 90 days following the closing of the Asset Sale into cash (to
the extent of the cash received), shall be deemed to be cash for purposes of
this provision.
Within 360 days of the receipt of any Net Proceeds from an
Asset Sale, the Company and its Restricted Subsidiaries may apply such Net
Proceeds, at their option, (a) to repay secured Indebtedness (and, in the case
of any such Indebtedness that was borrowed under a revolving credit line, to
correspondingly reduce commitments with respect thereto), or (b) to the
acquisition of a controlling interest in another business, the making of a
capital expenditure or the acquisition of other long-term assets, in each case,
in the same or a related or complementary line of business as the Company or any
of its Restricted Subsidiaries was engaged in on the date of the Indenture (as
determined in good faith by the Company).
A-1-7
<PAGE> 107
Pending the final application of any such Net Proceeds, the Company may
temporarily reduce the revolving credit lines under the New Credit Facility
(without any corresponding commitment reduction) or otherwise invest such Net
Proceeds in any manner that is not prohibited by the Indenture. Any Net Proceeds
from Asset Sales that are not applied or invested as provided in the first
sentence of this paragraph will be deemed to constitute "Excess Proceeds."
Not later than 30 days after any date (an "Asset Sale Offer
Trigger Date") that the aggregate amount of Excess Proceeds exceeds $10,000,000,
the Company shall mail to each holder of Notes at such holder's registered
address a notice stating: (i) that an Asset Sale Offer Trigger Date has occurred
and that the Company is offering to purchase the maximum principal amount of
Notes that may be purchased out of the Excess Proceeds, at an offer price in
cash equal to 100% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the date of purchase (the
"Asset Sale Offer Purchase Date"), which shall be a business day, specified in
such notice, that is not earlier than 30 days or later than 60 days from the
date such notice is mailed; (ii) the amount of accrued and unpaid interest and
Liquidated Damages, if any, thereon as of the Asset Sale Offer Purchase Date;
(iii) that any Note not tendered will continue to accrue interest and Liquidated
Damages, if any; (iv) that, unless the Company defaults in the payment of the
purchase price for the Notes payable pursuant to the Asset Sale Offer, any Notes
accepted for payment pursuant to the Asset Sale Offer shall cease to accrue
interest and Liquidated Damages, if any, after the Asset Sale Offer Purchase
Date; (v) the procedures, consistent with the Indenture, to be followed by a
holder of Notes in order to accept an Asset Sale Offer or to withdraw such
acceptance; and (vi) such other information as may be required by the Indenture
and applicable laws and regulations.
8. Denominations, Transfer, Exchange. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Company may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, it need not
exchange or register the transfer of any Notes for a period of 15 days before a
selection of Notes to be redeemed or during the period between a record date and
the corresponding Interest Payment Date.
9. Persons Deemed Owners. The registered Holder of a Note may be
treated as its owner for all purposes.
A-1-8
<PAGE> 108
10. Amendment, Supplement and Waiver. Subject to certain exceptions,
the Indenture or the Notes may be amended or supplemented with the consent of
the Holders of at least a majority in principal amount of the then outstanding
Notes, and any existing Default or compliance with any provision of the
Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes. Without the consent
of any Holder of a Note, the Indenture or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes, to
provide for the assumption of the Company's obligations to Holders of the Notes
in case of a merger or consolidation, to make any change that would provide any
additional rights or benefits to the Holders of the Notes or that does not
adversely affect the legal rights under the Indenture of any such Holder, or to
comply with the requirements of the SEC in order to effect or maintain the
qualification of the Indenture under the TIA.
11. Defaults and Remedies. The Indenture provides that each of the
following constitutes an Event of Default: (i) default for 30 days in the
payment when due of interest on, or Liquidated Damages with respect to, the
Notes; (ii) default in payment when due of the principal of or premium, if any,
on the Notes; (iii) failure by the Company or any of its Restricted Subsidiaries
to comply with Sections 4.07, 4.08, 4.09 or 4.10; (iv) failure by the Company or
any of its Subsidiaries for 60 days after receipt of notice to comply given by
the Trustee or the holders of at least 25% in principal amount of Notes then
outstanding to comply with any of its other agreements in the Indenture or the
Notes; (v) default under any mortgage, indenture or instrument under which there
is issued or by which there is be secured or evidenced any Indebtedness for
money borrowed by the Company or any of its Restricted Subsidiaries (or the
payment of which is guaranteed by the Company or any of its Restricted
Subsidiaries, other than Indebtedness owed to the Company or a Restricted
Subsidiary) whether such Indebtedness or guarantee now exists, or is created
after the date of the Indenture, which default (a) is caused by a failure to pay
principal of or premium, if any, on such Indebtedness after the expiration of
the grace period provided in such Indebtedness on the date of such default (a
"Payment Default") or (b) results in the acceleration of such Indebtedness prior
to its express maturity and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $10,000,000 or more, and such default has not been
cured, waived or postponed pursuant to an agreement with the holders of such
Indebtedness within 30 days after written notice as provided in the Indenture,
or such acceleration shall not be rescinded or annulled within 10 days after
written notice as provided in the Indenture; (vi) failure by the Company or any
of its Restricted Subsidiaries to pay final judgments aggregating in excess of
$10,000,000 to the extent that such judgments are not covered by insurance,
which judgments remain unpaid, undischarged or unstayed for a period of 60 days;
(vii) certain events of bankruptcy or insolvency with respect to the Company or
any of its Significant Subsidiaries; and (viii) except as permitted by the
Indenture, any Subsidiary Guarantee shall be held in any
A-1-9
<PAGE> 109
judicial proceeding to be unenforceable or invalid or shall cease for any reason
to be in full force and effect in any material respect or any Subsidiary
Guarantor, or any Person acting on behalf of any Subsidiary Guarantor, shall
deny or disaffirm its obligations under its Subsidiary Guarantee. Holders may
not enforce the Indenture or the Notes except as provided in the Indenture.
Subject to certain limitations, Holders of a majority in principal amount of the
then outstanding Notes may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Holders of the Notes notice of any
continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal or interest) if it determines that
withholding notice is in their interest. The Holders of a majority in aggregate
principal amount of the Notes then outstanding by notice to the Trustee may on
behalf of the Holders of all of the Notes waive any existing Default or Event of
Default and its consequences under the Indenture except a continuing Default or
Event of Default in the payment of interest on, or the principal of, the Notes.
The Company is required to deliver to the Trustee annually a statement regarding
compliance with the Indenture, and the Company is required upon becoming aware
of any Default or Event of Default, to deliver to the Trustee a statement
specifying such Default or Event of Default.
12. Ranking. The Notes will be general unsecured obligations of the
Company and will rank pari passu in right of payment with all current and future
unsecured senior indebtedness of the Company. The Notes will be guaranteed by
the Subsidiary Guarantors, which consist of all of the Company's present and
future Restricted Subsidiaries, other than Foreign Subsidiaries. The Subsidiary
Guarantees will be general unsecured obligations of the Subsidiary Guarantors
and will rank pari passu in right of payment with all current and future
unsecured senior indebtedness of the Subsidiary Guarantors.
13. Trustee Dealings with Company. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
14. No Recourse Against Others. A director, officer, employee,
incorporator or stockholder, of the Company, as such, shall not have any
liability for any obligations of the Company under the Notes or the Indenture or
for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Notes.
15. Authentication. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
16. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the
A-1-10
<PAGE> 110
entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors
Act).
17. Additional Rights of Holders of Transfer Restricted Notes. In
addition to the rights provided to Holders of Notes under the Indenture, Holders
of Transferred Restricted Notes shall have all the rights set forth in the
Registration Rights Agreement dated as of the date of the Indenture, among the
Company, the Subsidiary Guarantors and the Initial Purchaser (the "Registration
Rights Agreement").
18. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Medaphis Corporation
2700 Cumberland Parkway
Atlanta, GA 30339
Attention: General Counsel
Telephone No.: (770) 444-5300
A-1-11
<PAGE> 111
SUBSIDIARY GUARANTEE
The Subsidiary Guarantors listed below (hereinafter referred
to as the "Subsidiary Guarantors," which term includes any successors or assigns
under the Indenture and any additional Subsidiary Guarantors), have irrevocably
and unconditionally guaranteed the Guarantee Obligations, which include (i) the
due and punctual payment of the principal of, premium, if any, and interest on
the 9 1/2% Senior Notes due 2005 (the "Notes") of Medaphis Corporation, a
Delaware corporation (the "Company"), whether at stated maturity, by
acceleration or otherwise, the due and punctual payment of interest on the
overdue principal and Liquidated Damages and premium, if any, and (to the extent
permitted by law) interest on any interest, if any, on the Notes, and the due
and punctual performance of all other obligations of the Company, to the Holders
or the Trustee all in accordance with the terms set forth in Article 10 of the
Indenture, (ii) in case of any extension of time of payment or renewal of any
Notes or any such other obligations, that the same will be promptly paid in full
when due or performed in accordance with the terms of the extension or renewal,
whether at stated maturity, by acceleration or otherwise, and (iii) the payment
of any and all costs and expenses (including reasonable attorneys' fees)
incurred by the Trustee or any Holder in enforcing any rights under this
Subsidiary Guarantee, the Indenture or the Registration Rights Agreement.
The obligations of each Subsidiary Guarantor to the Holders
and to the Trustee pursuant to this Subsidiary Guarantee and the Indenture are
expressly set forth in Article 10 of the Indenture and reference is hereby made
to such Indenture for the precise terms of this Subsidiary Guarantee.
No stockholder, employee, officer, director or incorporator,
as such, past, present or future of each Subsidiary Guarantor shall have any
liability under this Subsidiary Guarantee by reason of his or its status as such
stockholder, employee, officer, director or incorporator.
This is a continuing Guarantee and shall remain in full force
and effect and shall be binding upon each Subsidiary Guarantor and its
successors and assigns until full and final payment of all of the Company's
obligations under the Notes and Indenture or until released in accordance with
the Indenture and shall inure to the benefit of the successors and assigns of
the Trustee and the Holders, and, in the event of any transfer or assignment of
rights by any Holder or the Trustee, the rights and privileges herein conferred
upon that party shall automatically extend to and be vested in such transferee
or assignee, all subject to the terms and conditions hereof. This is a Guarantee
of payment and not of collectibility.
This Subsidiary Guarantee shall not be valid or obligatory for
any purpose until the certificate of authentication on the Note upon which this
Subsidiary Guarantee is
A-1-12
<PAGE> 112
noted shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized officers.
The Obligations of each Subsidiary Guarantor under its
Subsidiary Guarantee shall be limited to the extent necessary to insure that it
does not constitute a fraudulent conveyance under applicable law.
THE TERMS OF ARTICLE 10 OF THE INDENTURE ARE INCORPORATED
HEREIN BY REFERENCE.
Capitalized terms used herein have the same meanings given in
the Indenture unless otherwise indicated.
A-1-13
<PAGE> 113
Dated as of February 20, 1998 MEDAPHIS PHYSICIAN SERVICES
CORPORATION
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 GOTTLIEB'S FINANCIAL SERVICES, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 MEDICAL MANAGEMENT SCIENCES, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
A-1-14
<PAGE> 114
Dated as of February 20, 1998 MEDAPHIS SERVICES CORPORATION
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 MEDAPHIS HEALTHCARE INFORMATION
TECHNOLOGY COMPANY
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 AUTOMATION ATWORK
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
A-1-15
<PAGE> 115
Dated as of February 20, 1998 CONSORT TECHNOLOGIES, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 HEALTH DATA SCIENCES CORPORATION
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 BSG CORPORATION
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
A-1-16
<PAGE> 116
Dated as of February 20, 1998 ASSETCARE, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 NATIONAL HEALTHCARE
TECHNOLOGIES, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 BSG ALLIANCE/IT, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
A-1-17
<PAGE> 117
Dated as of February 20, 1998 BSG GOVERNMENT SOLUTIONS, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
A-1-18
<PAGE> 118
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
________________________________________________________________________________
Date:___________________________
Your Signature:______________________________________________________________
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee.
A-1-19
<PAGE> 119
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.07 or 4.08 of the Indenture, check the box below:
[ ] Section 4.07 [ ] Section 4.08
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.07 or Section 4.08 of the Indenture, state the
amount you elect to have purchased: $___________
Date:________________ Your Signature:________________________________
(Sign exactly as your name appears on the Note)
Tax Identification No.:_____________________
Signature Guarantee.
A-1-20
<PAGE> 120
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE(2)
The following exchanges of a part of this Global Note for an interest
in another Global Notes or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in this Global Note, have
been made:
<TABLE>
<CAPTION>
Principal Amount of Signature of
Amount of decrease in Amount of increase in this Global Note authorized officer of
Principal Amount of Principal Amount of following such decrease Trustee or Note
Date of Exchange this Global Note this Global Note (or increase) Custodian
- ---------------------- ----------------------- ----------------------- ------------------------- -----------------------
<S> <C> <C> <C> <C>
</TABLE>
- --------------------
(2) This should be included only if the Note is issued in global form.
A-1-21
<PAGE> 121
EXHIBIT A-2
(Face of Regulation S Temporary Global Note)
CUSIP No: [U58220AA9 (Reg. S)]
[ISIN USU 582 20 AA94]
9 1/2% [Series A] [Series B] Senior Notes due 2005
No. $__________
MEDAPHIS CORPORATION
promises to pay to or registered assigns,
the principal sum of Dollars on February 15, 2005
Interest Payment Dates: February 15 and August 15
Record Dates: February 1 and August 1
Dated:
A-2-1
<PAGE> 122
MEDAPHIS CORPORATION
By:__________________________________________________
Name:
Title:
By:__________________________________________________
Name:
Title:
(SEAL)
Certificate of Authentication:
This is one of the Global Notes
referred to in the within-mentioned Indenture:
State Street Bank and Trust Company
By:______________________________
Authorized Signatory
Dated:
A-2-2
<PAGE> 123
(Back of Regulation S Temporary Global Note)
9 1/2% [Series A] [Series B] Senior Notes due 2005
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THE NOTE
EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE NOTE EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE
RELYING ON THE EXEMPTION PROVIDED BY RULE 144A UNDER THE SECURITIES ACT. THE
HOLDER OF THE NOTE EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A) SUCH NOTE MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1) (a) TO A
PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS
DEFINED IN OF RULE 144A UNDER THE
A-2-3
<PAGE> 124
SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (c)
OUTSIDE THE UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT OR (d) IN ACCORDANCE WITH
ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND
BASED UPON AN OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY
OR (3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN
ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THE NOTE EVIDENCED
HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (1) ABOVE.
Capitalized terms used herein shall have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.
1. Interest. Medaphis Corporation, a Delaware corporation (the "Company"),
promises to pay interest on the principal amount of this Note at 9 1/2% per
annum from February 20, 1998 until maturity and shall pay the Liquidated
Damages, if any, payable pursuant to Section 5 of the Registration Rights
Agreement referred to below. The Company will pay interest and Liquidated
Damages, if any, semi-annually on February 15 and August 15 of each year, or if
any such day is not a Business Day, on the next succeeding Business Day (each an
"Interest Payment Date"). Interest on the Notes will accrue from the most recent
date to which interest has been paid or, if no interest has been paid, from the
date of issuance; provided that if there is no existing Default in the payment
of interest, and if this Note is authenticated between a record date referred to
on the face hereof and the next succeeding Interest Payment Date, interest shall
accrue from such next succeeding Interest Payment Date; provided, further, that
the first Interest Payment Date shall be August 15, 1998. The Company shall pay
interest (including Accrued Bankruptcy Interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand at the rate then in effect; it shall pay interest (including Accrued
Bankruptcy Interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest and Liquidated Damages (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
Until this Regulation S Temporary Global Note is exchanged for one or more
Regulation S Permanent Global Notes, the Holder hereof shall not be entitled to
receive payments of interest hereon; until so exchanged in full, this Regulation
S Temporary Global Note shal in all other respects be entitled to the same
benefits as other Notes under the Indenture.
A-2-4
<PAGE> 125
2. Method of Payment. The Company will pay interest on the Notes (except
defaulted interest) and Liquidated Damages to the Persons who are registered
Holders of Notes at the close of business on the February 1 or August 1 next
preceding the Interest Payment Date, even if such Notes are cancelled after such
record date and on or before such Interest Payment Date, except as provided in
Section 2.12 of the Indenture (as defined below) with respect to defaulted
interest. The Notes will be payable as to principal, premium, interest and
Liquidated Damages at the office or agency of the Company maintained for such
purpose within or without the City and State of New York, or, at the option of
the Company, payment of interest and Liquidated Damages may be made by check
mailed to the Holders at their addresses set forth in the register of Holders,
and provided that payment by wire transfer of immediately available funds will
be required with respect to principal of and interest, premium and Liquidated
Damages on all Global Notes and all other Notes the Holders of which shall have
provided wire transfer instructions to the Company or the Paying Agent. Such
payment shall be in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts.
3. Paying Agent and Registrar. Initially, State Street Bank and Trust Company,
the Trustee under the Indenture, will act as Paying Agent and Registrar. The
Company may change any Paying Agent or Registrar without notice to any Holder.
The Company or any of its Subsidiaries may act in any such capacity.
4. Indenture. The Company issued the Notes under an Indenture dated as of
February 20, 1998 ("Indenture") among the Company, the Subsidiary Guarantors and
the Trustee. The terms of the Notes include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of
1939, as amended (15 U.S. Code Sections 77aaa-77bbbb). The Notes are subject to
all such terms, and Holders are referred to the Indenture and such Act for a
statement of such terms. The Notes are unsecured obligations of the Company
limited to $175,000,000 in aggregate principal amount.
5. Optional Redemption.
Except as set forth below, the Notes will not be redeemable at the
Company's option prior to February 15, 2002. Thereafter, the Notes will be
subject to redemption at any time at the option of the Company, in whole or in
part, upon not less than 30 or more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
applicable redemption date, if redeemed during the twelve-month period beginning
on February 15 of the years indicated below:
<TABLE>
<CAPTION>
YEAR PERCENTAGE
<S> <C>
2002.................................................104.750%
2003.................................................102.375%
2004 and thereafter..................................100.000%
</TABLE>
A-2-5
<PAGE> 126
Notwithstanding the foregoing, at any time or from time to
time on or prior to February 15, 2001, the Company may redeem up to 35% of the
aggregate principal amount of Notes originally issued under the Indenture at a
redemption price of 109.500% of the principal amount thereof, plus accrued and
unpaid interest and Liquidated Damages thereon, if any, to the redemption date,
with the net cash proceeds of one or more Equity Offerings; provided that at
least $100,000,000 in aggregate principal amount of Notes remain outstanding
immediately after the occurrence of such redemption; and provided, further, that
such redemption shall occur within 90 days of the date of the closing of such
Equity Offering.
6. Mandatory Redemption.
The Company shall not be required to make mandatory redemption payments
with respect to the Notes.
7. Repurchase Offers.
(a) Change of Control Offer. Upon the occurrence of a Change
of Control, each Holder of Notes will have the right to require the Company to
repurchase all or any part (equal to $1,000 or an integral multiple thereof) of
such Holder's Notes pursuant to the offer described below (the "Change of
Control Offer") at an offer price in cash equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest and Liquidated
Damages, if any, thereon to the date of purchase (the "Change of Control
Payment"). Within 15 Business Days following any Change of Control, the Company
will mail a notice to each Holder describing the transaction or transactions
that constitute the Change of Control and offering to repurchase Notes on the
date specified in such notice, which date shall be no earlier than 30 days and
no later than 60 days from the date such notice is mailed (the "Change of
Control Payment Date"), pursuant to the procedures required by the Indenture and
described in such notice. The Company will comply with the requirements of Rule
14e-1 under the Exchange Act and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable in connection
with the repurchase of the Notes as a result of a Change of Control. To the
extent that any applicable securities laws or regulations conflict with the
terms hereof, the Company shall comply with such laws or regulations and shall
not be deemed to have breached its obligations under the Indenture or Notes by
virtue thereof.
(b) Asset Sale Offer. The Indenture provides that the Company
will not, and will not permit any of its Restricted Subsidiaries to, consummate
an Asset Sale unless (i) the Company (or the Restricted Subsidiary, as the case
may be) receives consideration at the time of such Asset Sale at least equal to
the fair market value (evidenced by a resolution of the Board of Directors set
forth in an Officers' Certificate delivered to the Trustee in the case of
A-2-6
<PAGE> 127
any Asset Sale for which the Company or any of its Restricted Subsidiaries
receives consideration in excess of $15,000,000) of the assets or Equity
Interests issued or sold or otherwise disposed of and (ii) at least 80% of the
consideration therefor received by the Company or such Restricted Subsidiary is
in the form of cash or Cash Equivalents; provided that the amount of (x) any
liabilities (as shown on the Company's or such Restricted Subsidiary's most
recent balance sheet), of the Company or any Restricted Subsidiary (other than
contingent liabilities and liabilities that are by their terms subordinated to
the Notes or any guarantee thereof) that are assumed by the transferee of any
such assets pursuant to a customary novation or other agreement that releases
the Company or such Restricted Subsidiary from further liability and (y) any
securities, notes or other obligations received by the Company or any such
Restricted Subsidiary from such transferee that are converted by the Company or
such Restricted Subsidiary within 90 days following the closing of the Asset
Sale into cash (to the extent of the cash received), shall be deemed to be cash
for purposes of this provision.
Within 360 days of the receipt of any Net Proceeds from an
Asset Sale, the Company and its Restricted Subsidiaries may apply such Net
Proceeds, at their option, (a) to repay secured Indebtedness (and, in the case
of any such Indebtedness that was borrowed under a revolving credit line, to
correspondingly reduce commitments with respect thereto), or (b) to the
acquisition of a controlling interest in another business, the making of a
capital expenditure or the acquisition of other long-term assets, in each case,
in the same or a related or complementary line of business as the Company or any
of its Restricted Subsidiaries was engaged in on the date of the Indenture (as
determined in good faith by the Company). Pending the final application of any
such Net Proceeds, the Company may temporarily reduce the revolving credit lines
under the New Credit Facility (without any corresponding commitment reduction)
or otherwise invest such Net Proceeds in any manner that is not prohibited by
the Indenture. Any Net Proceeds from Asset Sales that are not applied or
invested as provided in the first sentence of this paragraph will be deemed to
constitute "Excess Proceeds."
Not later than 30 days after any date (an "Asset Sale Offer
Trigger Date") that the aggregate amount of Excess Proceeds exceeds $10,000,000,
the Company shall mail to each holder of Notes at such holder's registered
address a notice stating: (i) that an Asset Sale Offer Trigger Date has occurred
and that the Company is offering to purchase the maximum principal amount of
Notes that may be purchased out of the Excess Proceeds, at an offer price in
cash equal to 100% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the date of purchase (the
"Asset Sale Offer Purchase Date"), which shall be a business day, specified in
such notice, that is not earlier than 30 days or later than 60 days from the
date such notice is mailed; (ii) the amount of accrued and unpaid interest and
Liquidated Damages, if any, thereon as of the Asset Sale Offer Purchase Date;
(iii) that any Note not tendered will continue to accrue interest and Liquidated
Damages, if any; (iv) that, unless the Company defaults in the payment of the
A-2-7
<PAGE> 128
purchase price for the Notes payable pursuant to the Asset Sale Offer, any Notes
accepted for payment pursuant to the Asset Sale Offer shall cease to accrue
interest and Liquidated Damages, if any, after the Asset Sale Offer Purchase
Date; (v) the procedures, consistent with the Indenture, to be followed by a
holder of Notes in order to accept an Asset Sale Offer or to withdraw such
acceptance; and (vi) such other information as may be required by the Indenture
and applicable laws and regulations.
8. Denominations, Transfer, Exchange. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Company may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, it need not
exchange or register the transfer of any Notes for a period of 15 days before a
selection of Notes to be redeemed or during the period between a record date and
the corresponding Interest Payment Date.
9. Persons Deemed Owners. The registered Holder of a Note may be
treated as its owner for all purposes.
10. Amendment, Supplement and Waiver. Subject to certain exceptions,
the Indenture or the Notes may be amended or supplemented with the consent of
the Holders of at least a majority in principal amount of the then outstanding
Notes, and any existing Default or compliance with any provision of the
Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes. Without the consent
of any Holder of a Note, the Indenture or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes, to
provide for the assumption of the Company's obligations to Holders of the Notes
in case of a merger or consolidation, to make any change that would provide any
additional rights or benefits to the Holders of the Notes or that does not
adversely affect the legal rights under the Indenture of any such Holder, or to
comply with the requirements of the SEC in order to effect or maintain the
qualification of the Indenture under the TIA.
11. Defaults and Remedies. The Indenture provides that each of the
following constitutes an Event of Default: (i) default for 30 days in the
payment when due of interest on, or Liquidated Damages with respect to, the
Notes; (ii) default in payment when due of the principal of or premium, if any,
on the Notes; (iii) failure by the Company or any of its Restricted Subsidiaries
to comply with Sections 4.07, 4.08, 4.09 or 4.10; (iv) failure by the Company or
any of its Subsidiaries for 60 days after receipt of notice to comply given by
the
A-2-8
<PAGE> 129
Trustee or the holders of at least 25% in principal amount of Notes then
outstanding to comply with any of its other agreements in the Indenture or the
Notes; (v) default under any mortgage, indenture or instrument under which there
is issued or by which there is be secured or evidenced any Indebtedness for
money borrowed by the Company or any of its Restricted Subsidiaries (or the
payment of which is guaranteed by the Company or any of its Restricted
Subsidiaries, other than Indebtedness owed to the Company or a Restricted
Subsidiary) whether such Indebtedness or guarantee now exists, or is created
after the date of the Indenture, which default (a) is caused by a failure to pay
principal of or premium, if any, on such Indebtedness after the expiration of
the grace period provided in such Indebtedness on the date of such default (a
"Payment Default") or (b) results in the acceleration of such Indebtedness prior
to its express maturity and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $10,000,000 or more, and such default has not been
cured, waived or postponed pursuant to an agreement with the holders of such
Indebtedness within 30 days after written notice as provided in the Indenture,
or such acceleration shall not be rescinded or annulled within 10 days after
written notice as provided in the Indenture; (vi) failure by the Company or any
of its Restricted Subsidiaries to pay final judgments aggregating in excess of
$10,000,000 to the extent that such judgments are not covered by insurance,
which judgments remain unpaid, undischarged or unstayed for a period of 60 days;
(vii) certain events of bankruptcy or insolvency with respect to the Company or
any of its Significant Subsidiaries; and (viii) except as permitted by the
Indenture, any Subsidiary Guarantee shall be held in any judicial proceeding to
be unenforceable or invalid or shall cease for any reason to be in full force
and effect in any material respect or any Subsidiary Guarantor, or any Person
acting on behalf of any Subsidiary Guarantor, shall deny or disaffirm its
obligations under its Subsidiary Guarantee. Holders may not enforce the
Indenture or the Notes except as provided in the Indenture. Subject to certain
limitations, Holders of a majority in principal amount of the then outstanding
Notes may direct the Trustee in its exercise of any trust or power. The Trustee
may withhold from Holders of the Notes notice of any continuing Default or Event
of Default (except a Default or Event of Default relating to the payment of
principal or interest) if it determines that withholding notice is in their
interest. The Holders of a majority in aggregate principal amount of the Notes
then outstanding by notice to the Trustee may on behalf of the Holders of all of
the Notes waive any existing Default or Event of Default and its consequences
under the Indenture except a continuing Default or Event of Default in the
payment of interest on, or the principal of, the Notes. The Company is required
to deliver to the Trustee annually a statement regarding compliance with the
Indenture, and the Company is required upon becoming aware of any Default or
Event of Default, to deliver to the Trustee a statement specifying such Default
or Event of Default.
12. Ranking. The Notes will be general unsecured obligations of the
Company and will rank pari passu in right of payment with all current and future
unsecured senior indebtedness of the Company. The Notes will be guaranteed by
the Subsidiary Guarantors,
A-2-9
<PAGE> 130
which consist of all of the Company's present and future Restricted
Subsidiaries, other than Foreign Subsidiaries. The Subsidiary Guarantees will be
general unsecured obligations of the Subsidiary Guarantors and will rank pari
passu in right of payment with all current and future unsecured senior
indebtedness of the Subsidiary Guarantors.
13. Trustee Dealings with Company. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
14. No Recourse Against Others. A director, officer, employee,
incorporator or stockholder, of the Company, as such, shall not have any
liability for any obligations of the Company under the Notes or the Indenture or
for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Notes.
15. Authentication. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
16. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
17. Additional Rights of Holders of Transfer Restricted Notes. In
addition to the rights provided to Holders of Notes under the Indenture, Holders
of Transferred Restricted Notes shall have all the rights set forth in the
Registration Rights Agreement dated as of the date of the Indenture, among the
Company, the Subsidiary Guarantors and the Initial Purchaser (the "Registration
Rights Agreement").
18. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
A-2-10
<PAGE> 131
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Medaphis Corporation
2700 Cumberland Parkway
Atlanta, GA 30339
Attention: General Counsel
Telephone No.: (770) 444-5300
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<PAGE> 132
SUBSIDIARY GUARANTEE
The Subsidiary Guarantors listed below (hereinafter referred
to as the "Subsidiary Guarantors," which term includes any successors or assigns
under the Indenture and any additional Subsidiary Guarantors), have irrevocably
and unconditionally guaranteed the Guarantee Obligations, which include (i) the
due and punctual payment of the principal of, premium, if any, and interest on
the 9 1/2% Senior Notes due 2005 (the "Notes") of Medaphis Corporation, a
Delaware corporation (the "Company"), whether at stated maturity, by
acceleration or otherwise, the due and punctual payment of interest on the
overdue principal and Liquidated Damages and premium, if any, and (to the extent
permitted by law) interest on any interest, if any, on the Notes, and the due
and punctual performance of all other obligations of the Company, to the Holders
or the Trustee all in accordance with the terms set forth in Article 10 of the
Indenture, (ii) in case of any extension of time of payment or renewal of any
Notes or any such other obligations, that the same will be promptly paid in full
when due or performed in accordance with the terms of the extension or renewal,
whether at stated maturity, by acceleration or otherwise, and (iii) the payment
of any and all costs and expenses (including reasonable attorneys' fees)
incurred by the Trustee or any Holder in enforcing any rights under this
Subsidiary Guarantee, the Indenture or the Registration Rights Agreement.
The obligations of each Subsidiary Guarantor to the Holders
and to the Trustee pursuant to this Subsidiary Guarantee and the Indenture are
expressly set forth in Article 10 of the Indenture and reference is hereby made
to such Indenture for the precise terms of this Subsidiary Guarantee.
No stockholder, employee, officer, director or incorporator,
as such, past, present or future of each Subsidiary Guarantor shall have any
liability under this Subsidiary Guarantee by reason of his or its status as such
stockholder, employee, officer, director or incorporator.
This is a continuing Guarantee and shall remain in full force
and effect and shall be binding upon each Subsidiary Guarantor and its
successors and assigns until full and final payment of all of the Company's
obligations under the Notes and Indenture or until released in accordance with
the Indenture and shall inure to the benefit of the successors and assigns of
the Trustee and the Holders, and, in the event of any transfer or assignment of
rights by any Holder or the Trustee, the rights and privileges herein conferred
upon that party shall automatically extend to and be vested in such transferee
or assignee, all subject to the terms and conditions hereof. This is a Guarantee
of payment and not of collectibility.
This Subsidiary Guarantee shall not be valid or obligatory for
any purpose until the certificate of authentication on the Note upon which this
Subsidiary Guarantee is
A-2-12
<PAGE> 133
noted shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized officers.
The Obligations of each Subsidiary Guarantor under its
Subsidiary Guarantee shall be limited to the extent necessary to insure that it
does not constitute a fraudulent conveyance under applicable law.
THE TERMS OF ARTICLE 10 OF THE INDENTURE ARE INCORPORATED
HEREIN BY REFERENCE.
Capitalized terms used herein have the same meanings given in
the Indenture unless otherwise indicated.
A-2-13
<PAGE> 134
Dated as of February 20, 1998 MEDAPHIS PHYSICIAN SERVICES
CORPORATION
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 GOTTLIEB'S FINANCIAL SERVICES, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 MEDICAL MANAGEMENT SCIENCES, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
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<PAGE> 135
Dated as of February 20, 1998 MEDAPHIS SERVICES CORPORATION
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 MEDAPHIS HEALTHCARE INFORMATION
TECHNOLOGY COMPANY
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 AUTOMATION ATWORK
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
A-2-15
<PAGE> 136
Dated as of February 20, 1998 CONSORT TECHNOLOGIES, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 HEALTH DATA SCIENCES CORPORATION
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 BSG CORPORATION
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
A-2-16
<PAGE> 137
Dated as of February 20, 1998 ASSETCARE, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 NATIONAL HEALTHCARE
TECHNOLOGIES, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
Dated as of February 20, 1998 BSG ALLIANCE/IT, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
A-2-17
<PAGE> 138
Dated as of February 20, 1998 BSG GOVERNMENT SOLUTIONS, INC.
By:
--------------------------------
Name:
Title:
(SEAL)
- --------------------------------
Name:
Title:
A-2-18
<PAGE> 139
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
________________________________________________________________________________
Date:_____________________________
Your Signature:_____________________________________________________________
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee.
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<PAGE> 140
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.07 or 4.08 of the Indenture, check the box below:
[ ] Section 4.07 [ ] Section 4.08
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.07 or Section 4.08 of the Indenture, state the
amount you elect to have purchased: $___________
Date:_______________ Your Signature:________________________________
(Sign exactly as your name appears on the Note)
Tax Identification No.:______________________
Signature Guarantee.
A-2-20
<PAGE> 141
SCHEDULE OF EXCHANGES OF REGULATION S TEMPORARY GLOBAL NOTE
The following exchanges of a part of this Regulation S Temporary Global
Note for an interest in another Global Notes, or of other Restricted Global
Notes for an interest in this Regulation S Temporary Global Note, have been
made:
<TABLE>
<CAPTION>
Principal Amount of Signature of
Amount of decrease in Amount of increase in this Global Note authorized officer of
Principal Amount of Principal Amount of following such decrease Trustee or Note
Date of Exchange this Global Note this Global Note (or increase) Custodian
- ------------------ ----------------------- ----------------------- ------------------------- -----------------------
<S> <C> <C> <C> <C>
</TABLE>
A-2-21
<PAGE> 1
EXHIBIT 99.1
MEDAPHIS (TM) NEWS
[MEDAPHIS LOGO]
MEDAPHIS CORPORATION
2700 Cumberland Parkway
Suite 300
Atlanta, Georgia 30339
(770) 444-4000
FOR IMMEDIATE RELEASE
INVESTOR CONTACT:
Caryn Dickerson
Medaphis
(770) 444-5348
MEDAPHIS CLOSES $275 MILLION LONG-TERM
FINANCING PACKAGE
ATLANTA, GEORGIA -- (February 20, 1998) - Medaphis Corporation [NASDAQ:MEDA]
today announced the successful completion of a $100 million three-year senior
secured revolving credit facility and the private placement under Rule 144A of
$175 million 9 1/2% Senior Notes due February 15, 2005. The Company said that
these transactions provide additional liquidity and enhance the Company's
financial strength. As planned, the Company used a portion of the proceeds from
the financings to repay its previous credit facilities in full. The balance of
the proceeds will be used for general corporate purposes.
David McDowell, Chairman and Chief Executive Officer of Medaphis, said, "We are
extremely pleased with the refinancing package. The package significantly
strengthens the capital structure of the Company. The economic terms, covenant
flexibility and longer-term maturities provided in these new facilities signal
the Company's return to more traditional and customary financing arrangements,
which is an important component of our strategic business plan."
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<PAGE> 2
MEDAPHIS NEWS RELEASE
Page 2 of 2
ABOUT MEDAPHIS CORPORATION
Medaphis is a leader in delivering healthcare information products and
services, together with enabling technologies in selected industries. Based in
Atlanta, Georgia, Medaphis currently services approximately 20,700 physicians
and 2,700 hospitals across the nation, and more than 100 systems integration
customers in service industries such as healthcare, communications, energy and
financial services.
--###--
