SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported)December 5, 1996
UNITED WASTE SYSTEMS, INC.
(Exact name of Registrant as specified in its charter)
Delaware 0-20868 13-3532338
(State or other (Commission File number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
Four Greenwich Office Park, Greenwich, Connecticut 06830
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code
(203) 622-3131
Item 5. Other Events
1. The Company's credit facility was amended in December 1996 to,
among other things, eliminate certain covenants and lower borrowing
costs. The credit facility as so amended (the "Credit Facility")
provides for a $190 million, three year, secured revolving credit
facility due December 1999. Outstanding loans under the Credit
Facility bear interest at a rate per annum equal to the Eurodollar
Rate (Reserve Adjusted) (as defined in the loan agreement providing
for the Credit Facility) applicable to each interest period plus
0.625% to 1.25% per annum or the Alternate Reference Rate (as so
defined) from time to time in effect. The Credit Facility also
allows the Company to obtain up to $90 million in letters of credit.
The aggregate amount that the Company is permitted to borrow under
the Credit Facility is reduced by the aggregate face amount of all
outstanding letters of credit issued thereunder. The Credit
Facility is secured by the stock of the Company's subsidiaries,
restricts the Company from granting other liens on its assets
(subject to certain limited exceptions), and requires the Company
to comply with certain covenants including, but not limited to,
maintenance of certain financial ratios, limitations on additional
indebtedness, limitations on capital expenditures and a prohibition
on the Company's payment of cash dividends on its Common Stock. The
Credit Facility also currently requires that the consent of the
lenders be obtained in order for the Company to make an acquisition
that provides for an aggregate cash purchase price of $50 million
or more. In addition, the Credit Facility prohibits the Company
from using more that $15 million or its cash to secure closure and
post-closure obligations that the Company may have relating to its
landfills.
Item 7. Exhibits
(c) Exhibits. The following Exhibits are filed herewith:
Exhibit Number Exhibit
99 Fourth Amended and Restated Credit
Agreement dated as of December 5,
1996 among United Waste Systems,
Inc., various financial institutions,
the First National Bank of
Boston as co-agent and Bank of
America Illinois, as agent.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized on this 3rd day
of March, 1997.
UNITED WASTE SYSTEMS INC.
By: Michael J. Nolan
-----------------
Name: Michael J. Nolan
Title: Chief Financial Officer
Exhibit Index
Exhibit Number Exhibit
99 Fourth Amended and Restated Credit
Agreement dated as of December 5,
1996 among United Waste Systems,
Inc., various financial institutions,
the First National Bank of Boston as
co-agent and Bank of America Illinois, as agent.
Execution Version
FOURTH AMENDED AND RESTATED
CREDIT AGREEMENT
dated as of December 5, 1996
among
UNITED WASTE SYSTEMS, INC.,
VARIOUS FINANCIAL INSTITUTIONS,
THE FIRST NATIONAL BANK OF BOSTON,
as Co-Agent,
and
BANK OF AMERICA ILLINOIS,
as Agent
TABLE OF CONTENTS
Page
SECTION 1 DEFINITIONS . . . . . . . . . . . . . . . . . . . . 1
1.1 Definitions. . . . . . . . . . . . . . . . . . . . . . 1
SECTION 2 COMMITMENTS OF THE BANKS; LETTER OF CREDIT,
BORROWING AND CONVERSION PROCEDURES. . . . . . . . . . . . . 13
2.1 Commitments. . . . . . . . . . . . . . . . . . . . . . 13
2.1.1 Loan Commitment . . . . . . . . . . . . . . . 13
2.1.2 L/C Commitment. . . . . . . . . . . . . . . . 13
2.2 Loan Procedures. . . . . . . . . . . . . . . . . . . . 14
2.2.1 Various Types of Loans. . . . . . . . . . . . 14
2.2.2 Borrowing Procedures. . . . . . . . . . . . . 14
2.2.3 Procedures for Conversion of Type of Loan . . 14
2.3 Letter of Credit Procedures. . . . . . . . . . . . . . 15
2.3.1 L/C Applications. . . . . . . . . . . . . . . 15
2.3.2 Participation in Letters of Credit. . . . . . 15
2.3.3 Reimbursement Obligations . . . . . . . . . . 16
2.3.4 Limitation on BAI's Obligations . . . . . . . 16
2.3.5 Funding by Banks to BAI . . . . . . . . . . . 16
2.4 Commitments Several. . . . . . . . . . . . . . . . . . 17
2.5 Certain Conditions . . . . . . . . . . . . . . . . . . 17
SECTION 3 NOTES EVIDENCING LOANS. . . . . . . . . . . . . . . 17
3.1 Notes. . . . . . . . . . . . . . . . . . . . . . . . . 17
3.2 Recordkeeping. . . . . . . . . . . . . . . . . . . . . 17
SECTION 4 INTEREST. . . . . . . . . . . . . . . . . . . . . . 18
4.1 Interest Rates . . . . . . . . . . . . . . . . . . . . 18
4.2 Interest Payment Dates . . . . . . . . . . . . . . . . 18
4.3 Interest Periods . . . . . . . . . . . . . . . . . . . 18
4.4 Setting and Notice of Eurodollar Rates . . . . . . . . 19
4.5 Computation of Interest. . . . . . . . . . . . . . . . 19
SECTION 5 FEES. . . . . . . . . . . . . . . . . . . . . . . . 19
5.1 Non-Use Fee. . . . . . . . . . . . . . . . . . . . . . 19
5.2 Letter of Credit Fees. . . . . . . . . . . . . . . . . 20
5.3 Agent's Fees . . . . . . . . . . . . . . . . . . . . . 20
SECTION 6 REDUCTION AND TERMINATION OF THE COMMITMENTS; PREPAYMENTS. 20
6.1 Reduction or Termination of the Commitments. . . . . . 20
6.2 Voluntary Prepayments. . . . . . . . . . . . . . . . . 21
SECTION 7 MAKING AND PRORATION OF PAYMENTS; SETOFF; TAXES . . 21
7.1 Making of Payments . . . . . . . . . . . . . . . . . . 21
7.2 Application of Certain Payments. . . . . . . . . . . . 21
7.3 Due Date Extension . . . . . . . . . . . . . . . . . . 22
7.4 Setoff . . . . . . . . . . . . . . . . . . . . . . . . 22
7.5 Proration of Payments. . . . . . . . . . . . . . . . . 22
7.6 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 8 INCREASED COSTS; SPECIAL PROVISIONS FOR EURODOLLAR LOANS 24
8.1 Increased Costs. . . . . . . . . . . . . . . . . . . . 24
8.2 Basis for Determining Interest Rate Inadequate or
Unfair . . . . . . . . . . . . . . . . . . . . . . . 25
8.3 Changes in Law Rendering Eurodollar Loans Unlawful . . 26
8.4 Funding Losses . . . . . . . . . . . . . . . . . . . . 26
8.5 Right of Banks to Fund through Other Offices . . . . . 27
8.6 Discretion of Banks as to Manner of Funding. . . . . . 27
8.7 Mitigation of Circumstances; Replacement of Affected
Bank . . . . . . . . . . . . . . . . . . . . . . . . 27
8.8 Conclusiveness of Statements; Survival of Provisions . 28
SECTION 9 WARRANTIES. . . . . . . . . . . . . . . . . . . . . 28
9.1 Organization, etc. . . . . . . . . . . . . . . . . . . 28
9.2 Authorization; No Conflict . . . . . . . . . . . . . . 28
9.3 Validity and Binding Nature. . . . . . . . . . . . . . 29
9.4 Financial Information. . . . . . . . . . . . . . . . . 29
9.5 No Material Adverse Change . . . . . . . . . . . . . . 29
9.6 Litigation and Contingent Liabilities. . . . . . . . . 29
9.7 Ownership of Properties; Liens . . . . . . . . . . . . 30
9.8 Subsidiaries . . . . . . . . . . . . . . . . . . . . . 30
9.9 Pension and Welfare Plans. . . . . . . . . . . . . . . 30
9.10 Investment Company Act . . . . . . . . . . . . . . . . 31
9.11 Public Utility Holding Company Act . . . . . . . . . . 31
9.12 Regulation U . . . . . . . . . . . . . . . . . . . . . 31
9.13 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . 31
9.14 Solvency, etc. . . . . . . . . . . . . . . . . . . . . 31
9.15 Environmental Compliance . . . . . . . . . . . . . . . 31
9.15.1 No Violations. . . . . . . . . . . . . . . . 31
9.15.2 Notices. . . . . . . . . . . . . . . . . . . 32
9.15.3 Handling of Hazardous Substances . . . . . . 32
9.15.4 Clean-Ups. . . . . . . . . . . . . . . . . . 33
9.15.5 Permits and Governmental Authority . . . . . 33
9.15.6 Investigations . . . . . . . . . . . . . . . 33
9.15.7 Updating of Schedule II. . . . . . . . . . . 33
9.16 Information. . . . . . . . . . . . . . . . . . . . . . 34
SECTION 10 COVENANTS. . . . . . . . . . . . . . . . . . . . . 34
10.1 Reports, Certificates and Other Information. . . . . . 34
10.1.1 Audit Report . . . . . . . . . . . . . . . . 34
10.1.2 Quarterly Reports. . . . . . . . . . . . . . 34
10.1.3 Compliance Certificates. . . . . . . . . . . 35
10.1.4 Reports to SEC and to Shareholders . . . . . 35
10.1.5 Notice of Default, Litigation and
ERISA Matters . . . . . . . . . . . . . . 35
10.1.6 Subsidiaries . . . . . . . . . . . . . . . . 37
10.1.7 Management Reports . . . . . . . . . . . . . 37
10.1.8 Projections. . . . . . . . . . . . . . . . . 37
10.1.9 Other Information. . . . . . . . . . . . . . 37
10.2 Books, Records and Inspections . . . . . . . . . . . . 37
10.3 Insurance. . . . . . . . . . . . . . . . . . . . . . . 38
10.4 Compliance with Laws; Payment of Taxes and Liabilities 38
10.5 Maintenance of Existence, etc. . . . . . . . . . . . . 38
10.6 Financial Covenants. . . . . . . . . . . . . . . . . . 39
10.6.1 Minimum Net Worth. . . . . . . . . . . . . . 39
10.6.2 Maximum Leverage . . . . . . . . . . . . . . 39
10.6.3 Minimum Interest Coverage. . . . . . . . . . 39
10.6.4 Funded Debt to Cash Flow Ratio . . . . . . . 39
10.7 Limitations on Debt. . . . . . . . . . . . . . . . . . 39
10.8 Liens. . . . . . . . . . . . . . . . . . . . . . . . . 40
10.9 Capital Expenditures . . . . . . . . . . . . . . . . . 41
10.10 Restricted Payments. . . . . . . . . . . . . . . . . . 42
10.11 Mergers, Consolidations, Sales . . . . . . . . . . . . 42
10.12 Modification of Organizational Documents . . . . . . . 43
10.13 Use of Proceeds. . . . . . . . . . . . . . . . . . . . 43
10.14 Further Assurances . . . . . . . . . . . . . . . . . . 43
10.15 Transactions with Affiliates . . . . . . . . . . . . . 44
10.16 Employee Benefit Plans . . . . . . . . . . . . . . . . 44
10.17 Environmental Covenants. . . . . . . . . . . . . . . . 44
10.17.1 Environmental Response Obligation . . . . . 44
10.17.2 Environmental Liabilities . . . . . . . . . 45
10.17.3 Closure and Post Closure Liabilities. . . . 45
10.17.4 Real Property Acquisitions. . . . . . . . . 45
10.18 Unconditional Purchase Obligations . . . . . . . . . . 45
10.19 Inconsistent Agreements. . . . . . . . . . . . . . . . 45
10.20 Business Activities. . . . . . . . . . . . . . . . . . 46
10.21 Advances and Other Investments . . . . . . . . . . . . 46
10.22 Operating Leases . . . . . . . . . . . . . . . . . . . 47
10.23 Landfill Development . . . . . . . . . . . . . . . . . 47
SECTION 11 EFFECTIVENESS; CONDITIONS OF LENDING, ETC. . . . . 48
11.1 Effectiveness. . . . . . . . . . . . . . . . . . . . . 48
11.1.1 Notes. . . . . . . . . . . . . . . . . . . . 48
11.1.2 Resolutions. . . . . . . . . . . . . . . . . 48
11.1.3 Consents, etc. . . . . . . . . . . . . . . . 48
11.1.4 Incumbency and Signature Certificates. . . . 48
11.1.5 Intercompany Guaranty. . . . . . . . . . . . 48
11.1.6 Opinions of Counsel for the Company and
the Guarantors. . . . . . . . . . . . . . 48
11.1.7 Opinion of Counsel to the Agent. . . . . . . 49
11.1.8 Confirmation from Guarantors, etc. . . . . . 49
11.1.9 Other. . . . . . . . . . . . . . . . . . . . 49
11.2 Conditions . . . . . . . . . . . . . . . . . . . . . . 49
11.2.1 Compliance with Warranties, No Default, etc. 49
11.2.2 Confirmatory Certificate . . . . . . . . . . 50
SECTION 12 EVENTS OF DEFAULT AND THEIR EFFECT . . . . . . . . 50
12.1 Events of Default. . . . . . . . . . . . . . . . . . . 50
12.1.1 Non-Payment of the Loans, etc. . . . . . . . 50
12.1.2 Non-Payment of Other Debt. . . . . . . . . . 50
12.1.3 Other Material Obligations . . . . . . . . . 51
12.1.4 Bankruptcy, Insolvency, etc. . . . . . . . . 51
12.1.5 Non-Compliance with Provisions of This
Agreement . . . . . . . . . . . . . . . . 51
12.1.6 Warranties . . . . . . . . . . . . . . . . . 52
12.1.7 Pension Plans. . . . . . . . . . . . . . . . 52
12.1.8 Judgments. . . . . . . . . . . . . . . . . . 52
12.1.9 Invalidity of Intercompany Guaranty, etc . . 52
12.1.10 Invalidity of Company Pledge Agreement . . . 52
12.1.11 Change in Control. . . . . . . . . . . . . . 52
12.1.12 Material Environmental Events. . . . . . . . 53
12.2 Effect of Event of Default . . . . . . . . . . . . . . 53
SECTION 13 THE AGENT. . . . . . . . . . . . . . . . . . . . . 54
13.1 Appointment and Authorization. . . . . . . . . . . . . 54
13.2 Delegation of Duties . . . . . . . . . . . . . . . . . 54
13.3 Liability of Agent . . . . . . . . . . . . . . . . . . 54
13.4 Reliance by Agent. . . . . . . . . . . . . . . . . . . 55
13.5 Notice of Default. . . . . . . . . . . . . . . . . . . 55
13.6 Credit Decision. . . . . . . . . . . . . . . . . . . . 56
13.7 Indemnification. . . . . . . . . . . . . . . . . . . . 56
13.8 Agent in Individual Capacity . . . . . . . . . . . . . 58
13.9 Successor Agent; Assignment of Agency. . . . . . . . . 58
13.10 Withholding Tax. . . . . . . . . . . . . . . . . . . . 59
SECTION 14 GENERAL. . . . . . . . . . . . . . . . . . . . . . 61
14.1 Waiver; Amendments . . . . . . . . . . . . . . . . . . 61
14.2 Confirmations. . . . . . . . . . . . . . . . . . . . . 61
14.3 Notices. . . . . . . . . . . . . . . . . . . . . . . . 62
14.4 Computations . . . . . . . . . . . . . . . . . . . . . 62
14.5 Regulation U . . . . . . . . . . . . . . . . . . . . . 62
14.6 Costs, Expenses and Taxes. . . . . . . . . . . . . . . 62
14.7 Subsidiary References. . . . . . . . . . . . . . . . . 63
14.8 Captions . . . . . . . . . . . . . . . . . . . . . . . 63
14.9 Assignments; Participation . . . . . . . . . . . . . . 63
14.9.1 Assignments. . . . . . . . . . . . . . . . . 63
14.9.2 Participation. . . . . . . . . . . . . . . . 65
14.10 Governing Law . . . . . . . . . . . . . . . . . . . . 65
14.11 Counterparts. . . . . . . . . . . . . . . . . . . . . 66
14.12 Successors and Assigns. . . . . . . . . . . . . . . . 66
14.13 Indemnification by the Company. . . . . . . . . . . . 66
14.14 Forum Selection and Consent to Jurisdiction . . . . . 67
14.15 Waiver of Jury Trial. . . . . . . . . . . . . . . . . 68
ANNEX I
SCHEDULE I Pricing Schedule
SCHEDULE II Details Schedule
EXHIBIT A Form of Note (Section 3.1)
EXHIBIT B Form of Compliance Certificate
(Section 10.1.3)
EXHIBIT C Copy of Amended and Restated Guaranty
(Section 1)
EXHIBIT D Copy of Amended and Restated Company Pledge
Agreement
(Section 1)
EXHIBIT E Form of Subordination Language
(Section 1)
EXHIBIT F Form of Assignment Agreement
(Section 14.9)
FOURTH AMENDED AND RESTATED CREDIT AGREEMENT
This FOURTH AMENDED AND RESTATED CREDIT AGREEMENT, dated as
of December 5, 1996 (as further amended or otherwise modified
from time to time, this "Agreement"), is entered into among
UNITED WASTE SYSTEMS, INC., a Delaware corporation (the
"Company"), the financial institutions that are or may from time
to time become parties hereto (together with their respective
successors and assigns, the "Banks"), THE FIRST NATIONAL BANK OF
BOSTON, as co-agent for the Banks, and BANK OF AMERICA ILLINOIS
(in its individual capacity, "BAI"), as agent for the Banks.
WHEREAS, the Company, various financial institutions and the
Agent have entered into a Credit Agreement, dated as of December
30, 1993 (as amended or otherwise modified, the "Existing
Agreement"); and
WHEREAS, subject to the terms and conditions of this
Agreement, the Company, the Agent and the Banks have agreed to
amend and restate the Existing Agreement as hereinafter set
forth;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein contained, and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
SECTION 1 DEFINITIONS.
1.1 Definitions. When used herein the following terms
shall have the following meanings (such definitions to be
applicable to both the singular and plural forms of such terms):
Adjusted Consolidated Net Worth means "Adjusted Consolidated
Net Worth" as defined in the Senior Note Agreement.
Affected Bank means any Bank that has given notice to the
Company (which has not been rescinded) of (i) any obligation by
the Company to pay any amount pursuant to Section 7.6 or 8.1 or
(ii) the occurrence of any circumstances of the nature described
in Section 8.2 or 8.3.
Affiliate of any Person means (i) any other Person which,
directly or indirectly, controls or is controlled by or is under
common control with such Person and (ii) any officer or director
of such Person.
Agent means BAI in its capacity as agent for the Banks
hereunder and any successor thereto in such capacity.
Agent-Related Persons means BAI and any successor agent
arising under Section 13.9, together with their respective
Affiliates (including, in the case of BAI, the Arranger), and the
officers, directors, employees, agents and attorneys-in-fact of
such Persons and Affiliates.
Agreement - see the Preamble.
Alternate Reference Rate means at any time the greater of
(a) the Federal Funds Rate plus 1/2 of 1% and (b) the Reference
Rate.
Arranger means BA Securities, Inc., a Delaware corporation.
Assignment Agreement - see Section 14.9.1.
BAI - see the Preamble.
Bank - see the Preamble.
Business Day means any day on which BAI is open for
commercial banking business in Chicago, New York and San
Francisco and, in the case of a Business Day which relates to a
Eurodollar Loan, on which dealings are carried on in the
interbank eurodollar market.
Capital Lease means, with respect to any Person, any lease
of (or other agreement conveying the right to use) any real or
personal property by such Person that, in conformity with
generally accepted accounting principles, is accounted for as a
capital lease on the balance sheet of such Person.
Cash Equivalent Investment means, at any time, (a) any
evidence of Debt, maturing not more than one year after such
time, issued or guaranteed by the United States Government or any
agency thereof, (b) commercial paper, maturing not more than nine
months from the date of issue, or corporate demand notes, in each
case (unless issued by a Bank or its holding company) rated at
least A-l by Standard & Poor's Ratings Group or P-l by Moody's
Investors Service, Inc., (c) any certificate of deposit (or time
deposits represented by such certificates of deposit) or bankers
acceptance, maturing not more than one year after such time, or
overnight Federal Funds transactions that are issued or sold by a
commercial banking institution that is a member of the Federal
Reserve System and has a combined capital and surplus and
undivided profits of not less than $500,000,000, (d) any
repurchase agreement entered into with any Bank (or other
commercial banking institution of the stature referred to in
clause (c)) which (i) is secured by a fully perfected security
interest in any obligation of the type described in any of
clauses (a) through (c) and (ii) has a market value at the time
such repurchase agreement is entered into of not less than 100%
of the repurchase obligation of such Bank (or other commercial
banking institution) thereunder and (e) investments in short-term
asset management accounts offered by any Bank for the purpose of
investing in loans to any corporation (other than an Affiliate of
the Company) or municipality, in each case organized under the
laws of any state of the United States or of the District of
Columbia.
CERCLA - see Section 9.15.1.
Code means the Internal Revenue Code of 1986, as amended
from time to time.
Commitment Amount - see Section 2.1.1.
Commitments means the Loan Commitment and the Letter of
Credit Commitment.
Company - see the Preamble.
Company Pledge Agreement means the Amended and Restated
Company Pledge Agreement dated as of September 28, 1995, between
the Company and the Agent, a copy of which is attached hereto as
Exhibit D, as amended or otherwise modified from time to time.
Computation Period means any period of four Fiscal Quarters
ending on the last day of a Fiscal Quarter.
Consolidated Net Income means, with respect to the Company
and its Subsidiaries for any period, the net income (or loss) of
the Company and its Subsidiaries for such period.
Contingent Payment means any payment that has been (or is
required to be) made under any of the following circumstances:
(a) such payment is required to be made by the Company
or any Subsidiary in connection with the purchase of any
landfill, asset or business, where the obligation of the
Company or the applicable Subsidiary to make such payment
(or the amount thereof) is contingent upon the financial or
other performance of such landfill, asset or business on an
ongoing basis (e.g., based on revenues, percentage of
utilization, tonnage or similar measures of performance);
(b) such payment is required to be made by the Company
or any Subsidiary in connection with the achievement of any
particular business goal (e.g., the acquisition of a
construction permit for the expansion of a landfill); or
(c) such payment is required to be made by the Company
or any Subsidiary under circumstances similar to those
described in clause (a) or (b) or provides substantially the
same economic incentive as would a payment described in
clause (a) or (b).
Contingent Payments of the type described in clause (a) are
sometimes called "Royalties."
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 Company, are treated as a single
employer under Section 414 of the Code or Section 4001 of ERISA.
Debt of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money, whether or not
evidenced by bonds, debentures, notes or similar instruments, (b)
all obligations of such Person as lessee under Capital Leases
which have been or should be recorded as liabilities on a balance
sheet of such Person, (c) all obligations of such Person to pay
the deferred purchase price of property or services (including
Contingent Payments and excluding trade accounts payable in the
ordinary course of business), (d) all indebtedness secured by a
Lien on the property of such Person, whether or not such
indebtedness shall have been assumed by such Person (it being
understood that if such Person has not assumed or otherwise
become personally liable for any such indebtedness, the amount of
the Debt of such Person in connection therewith shall be limited
to the lesser of the face amount of such indebtedness or the fair
market value of all property of such Person securing such
indebtedness), (e) all obligations, contingent or otherwise, with
respect to the face amount of all letters of credit (whether or
not drawn) and banker's acceptances issued for the account of
such Person (including the Letters of Credit), (f) net
liabilities of such Person under all Hedging Obligations and (g)
all Guaranties of such Person.
Disposal - see the definition of "Release".
Dollar and the sign "$" mean lawful money of the United
States of America.
Effective Date - see Section 11.1.
Environmental Law - see Section 9.15.1.
EPA - see Section 9.15.2.
ERISA means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute 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.
Eurocurrency Reserve Percentage means, with respect to any
Eurodollar Loan for any Interest Period, a percentage (expressed
as a decimal) equal to the daily average during such Interest
Period of the percentage in effect on each day of such Interest
Period, as prescribed by the Board of Governors of the Federal
Reserve System (or any successor), for determining the aggregate
maximum reserve requirements applicable to "Eurocurrency
Liabilities" pursuant to Regulation D or any other then
applicable regulation of such Board of Governors which prescribes
reserve requirements applicable to "Eurocurrency Liabilities" as
presently defined in Regulation D.
Eurodollar Loan means any Loan which bears interest at a
rate determined by reference to the Eurodollar Rate (Reserve
Adjusted).
Eurodollar Office means with respect to any Bank the office
or offices of such Bank which shall be making or maintaining the
Eurodollar Loans of such Bank hereunder or such other office or
offices through which such Bank determines its Eurodollar Rate.
A Eurodollar Office of any Bank may be, at the option of such
Bank, either a domestic or foreign office.
Eurodollar Rate means, with respect to any Eurodollar Loan
for any Interest Period, the rate per annum at which Dollar
deposits in immediately available funds are offered to the
Eurodollar Office of BAI two Business Days prior to the beginning
of such Interest Period by major banks in the interbank
eurodollar market as at or about 10:00 A.M., Chicago time, for
delivery on the first day of such Interest Period, for the number
of days comprised therein and in an amount equal or comparable to
the amount of the Eurodollar Loan of BAI for such Interest
Period.
Eurodollar Rate (Reserve Adjusted) means, with respect to
any Eurodollar Loan for any Interest Period, a rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%)
determined pursuant to the following formula:
Eurodollar Rate = Eurodollar Rate
(Reserve Adjusted) 1-Eurocurrency
Reserve Percentage
Event of Default means any of the events described in
Section 12.1.
Existing Agreement - see the Recitals.
Federal Funds Rate means, for any day, the rate set forth in
the weekly statistical release designated as H.15(519), or any
successor publication, published by the Federal Reserve Bank of
New York (including any such successor publication, "H.15(519)")
on the preceding Business Day opposite the caption "Federal Funds
(Effective)"; or, if for any relevant day such rate is not so
published on any such preceding Business Day, the rate for such
day will be the arithmetic mean as determined by the Agent of the
rates for the last transaction in overnight Federal funds
arranged prior to 9:00 a.m. (New York City time) on that day by
each of three leading brokers of Federal funds transactions in
New York City selected by the Agent.
Financial Letter of Credit means any Letter of Credit
determined by BAI to be a "financial guaranty-type Standby Letter
of Credit" as defined in footnote 13 to Appendix A to the Risk
Based Capital Guidelines issued by the Comptroller of the
Currency (or in any successor regulation, guideline or ruling by
any applicable banking regulatory authority).
Fiscal Quarter means a fiscal quarter of a Fiscal Year.
Fiscal Year means the fiscal year of the Company and its
Subsidiaries, which period shall be the 12-month period ending on
December 31 of each year. References to a Fiscal Year with a
number corresponding to any calendar year (e.g., "Fiscal Year
1994") refer to the Fiscal Year ending on December 31 of such
calendar year.
Floating Rate Loan means any Loan which bears interest at or
by reference to the Alternate Reference Rate.
Funded Debt means all Debt of the Company and its
Subsidiaries, excluding (i) contingent obligations in respect of
undrawn letters of credit and Guaranties (except, in each case,
to the extent constituting Guaranties in respect of Funded Debt
of a Person other than the Company or any Subsidiary), (ii)
Hedging Obligations and (iii) Debt of the Company to Subsidiaries
and Debt of Subsidiaries to the Company or to other Subsidiaries.
Funded Debt to Cash Flow Ratio means the ratio of (i) Funded
Debt as of the last day of any Computation Period to (ii)
Consolidated Net Income for such Computation Period plus, to the
extent deducted in determining such Consolidated Net Income,
Interest Expense, income tax expense, depreciation and
amortization for such Computation Period.
Group - see Section 2.2.1.
Guarantor means, on any day, each Subsidiary that has
executed a counterpart of the Intercompany Guaranty on or prior
to that day (or is required to execute a counterpart of the
Intercompany Guaranty on that date).
Guaranty 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) any indebtedness, obligation or
other liability 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 Guaranty shall (subject to any limitation set forth therein)
be deemed to be the principal amount of the debt, obligation or
other liability supported thereby.
Hazardous Substances - see Section 9.15.2.
Hedging Obligations means, with respect to any Person, all
liabilities of such Person under interest rate, currency and
commodity swap agreements, cap agreements and collar agreements,
and all other agreements or arrangements designed to protect such
Person against fluctuations in interest rates, currency exchange
rates or commodity prices.
Immaterial Law means any provision of any Environmental Law
the violation of which will not (a) violate any judgment, decree
or order which is binding upon the Company or any Subsidiary, (b)
result in or threaten any injury to public health or the
environment or any material damage to the property of any Person
or (c) result in any liability or expense (other than any de
minimis liability or expense) for the Company or any Subsidiary;
provided that no provision of any Environmental Law shall be an
Immaterial Law if the Agent has notified the Company that the
Required Banks have determined in good faith that such provision
is material.
Immaterial Notice means a notice from or allegation by a
Person which is not governmental or regulatory authority or
agency (or a representative thereof) regarding any event or
condition relating to the environment for which the Company or
any Subsidiary may have any liability or any breach by the
Company or any Subsidiary of any Environmental Law, which notice
or allegation (a) has not given rise to any judicial or
regulatory case or proceeding and (b) in the reasonable judgment
the Company, is not likely to result in any liability or expense
(other than any de minimis liability or expense) for the Company
or the applicable Subsidiary.
Including means including without limiting the generality of
any description preceding such term, and other forms of the verb
"to include" have correlative meanings.
Insurance Subsidiary means a direct Subsidiary of the
Company which is (a) organized under the laws of the State of
Vermont and (b) engaged solely in the business of providing
insurance and bonding to the Company and its Subsidiaries (and
investing the proceeds of premiums received for providing such
insurance); it being understood that the Company may not have
more than one Insurance Subsidiary at any time without the
consent of the Required Banks.
Intercompany Guaranty means the Amended and Restated
Guaranty dated as of September 28, 1995, a copy of which is
attached hereto as Exhibit C, as amended or otherwise modified
from time to time.
Interest Coverage Ratio means the ratio of (a) Consolidated
Net Income before deducting Interest Expense and income tax
expense for any Computation Period to (b) Interest Expense for
such Computation Period.
Interest Expense means for any period the consolidated
interest expense of the Company and its Subsidiaries for such
period (including all imputed interest on Capital Leases and
before giving effect to any capitalization of interest but
excluding amortization of deferred financing costs).
Interest Period - see Section 4.3.
Investment means, relative to any Person, (a) any loan or
advance made by such Person to any other Person (excluding any
commission, travel or similar advances made to directors,
officers and employees of the Company or any of its
Subsidiaries), (b) any Guaranty of such Person, (c) any ownership
or similar interest held by such Person in any other Person and
(d) deposits and the like relating to prospective acquisitions of
businesses (excluding deposits placed in escrow pursuant to bona
fide arrangements that provide for the return of such deposits to
the Company in the event that the related transaction is not
consummated for any reason by a date certain).
L/C Application means, with respect to any request for the
issuance of a Letter of Credit, a letter of credit application in
the form being used by BAI at the time of such request for the
type of letter of credit requested.
L/C Commitment means the commitment of BAI to issue, and of
each Bank to participate in, Letters of Credit pursuant to
Section 2.1.2.
Letter of Credit - see Section 2.1.2.
Lien means, with respect to any Person, any interest granted
by such Person in any real or personal property, asset or other
right owned or being purchased or acquired by such Person which
secures payment or performance of any obligation and shall
include any mortgage, lien, encumbrance, charge or other security
interest of any kind, whether arising by contract, as a matter of
law, by judicial process or otherwise.
Loan Commitment means the commitment of the Banks to make
Loans pursuant to Section 2.1.1.
Loan Documents means this Agreement, the Notes, the
Intercompany Guaranty, the L/C Applications and the Company
Pledge Agreement.
Loans - see Section 2.1.1.
Margin Stock means any "margin stock" as defined in
Regulation U of the Board of Governors of the Federal Reserve
System.
Methane Disposal Subsidiary means any Subsidiary of the
Company which is engaged solely in the business of operating a
landfill gas recovery system on a landfill operated by the
Company or any of its Subsidiaries and which is designated in
writing to the Agent as a "Methane Disposal Subsidiary";
provided, however, that no Subsidiary shall be designated, or
remain designated, as a Methane Disposal Subsidiary if the
aggregate amount of all Investments made by the Company and its
Subsidiaries in such Subsidiary shall exceed the sum of
$2,500,000.
Multiemployer Pension Plan means a multiemployer plan, as
such term is defined in Section 4001(a)(3) of ERISA, and to which
the Company or any member of the Controlled Group may have any
liability.
Net Worth means the Company's consolidated stockholders'
equity (including preferred stock accounts).
Non-Financial Letter of Credit means any Standby Letter of
Credit other than a Financial Letter of Credit.
Note - see Section 3.1.
Operating Lease means any lease of (or other agreement
conveying the right to use) any real or personal property by the
Company or any Subsidiary, as lessee, other than a Capital Lease.
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 Pension Plan), and to which the
Company or any member of the Controlled Group, may have any
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, with respect to any Bank, the percentage
specified opposite such Bank's name on Annex I hereto, reduced
(or increased) by subsequent assignments pursuant to Section
14.9.1.
Permitted Subordinated Debt means unsecured indebtedness of
the Company for money borrowed that is subordinated,
substantially upon the terms set forth in Exhibit E or other
terms that are more favorable to the Agent and the Banks, in
right of payment to the payment in full in cash of the Loans and
all other amounts owed under the Loan Documents (whether or not
matured or due and payable), including amounts required to
provide cash collateral for the Letters of Credit.
Permitted Subordinated Note Payment means any payment
referred to in clauses (i) through (iii) below by the Company
under the Subordinated Notes, so long as (x) no Event of Default
or Unmatured Event of Default under this Agreement exists and is
continuing or would occur as a result of such payment and (y)
such payment is made in compliance with the terms and conditions
of the Subordinated Note Indenture, (i) any payment of the
principal of (and premium, if any) and interest (including any
"Additional Amounts" as defined in the Subordinated Note
Indenture) on the Subordinated Notes as and when the same shall
become due and payable, whether by declaration of acceleration or
otherwise, (ii) any payment by the Company of the redemption
price (including any accrued interest) in respect of any
redemption described in Section 2.2 of the Subordinated Note
Indenture and (iii) any payment by the Company of the repurchase
price (including any accrued interest) in respect of any
repurchase of Subordinated Notes pursuant to Section 14.1 of the
Subordinated Note Indenture, whether payable in cash or common
stock of the Company.
Person means any natural person, corporation, partnership,
trust, association, governmental authority or unit, or any other
entity, whether acting in an individual, fiduciary or other
capacity.
RCRA - see Section 9.15.1.
Real Property means all real property heretofore, now or
hereafter owned, operated or leased by the Company or any
Subsidiary.
Reference Rate means, for any day, the rate of interest in
effect for such day as publicly announced from time to time by
BAI in Chicago, Illinois, as its "reference rate." (The
"reference rate" is a rate set by BAI based upon various factors,
including BAI's costs and desired return, general economic
conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below
such announced rate.) Any change in the reference rate announced
by BAI shall take effect at the opening of business on the day
specified in the public announcement of such change.
Release has the meaning specified in CERCLA and the term
"Disposal" (or "Disposed") shall have the meaning specified in
RCRA and regulations promulgated thereunder; provided, that in
the event either CERCLA or RCRA is amended so as to broaden the
meaning of any term defined thereby, such broader meaning shall
apply as of the effective date of such amendment and provided
further, to the extent that the laws of a state wherein the
affected property lies establishes a meaning for "Release" or
"Disposal" which is broader than is specified in either CERCLA or
RCRA, such broader meaning shall apply.
Required Banks means Banks (including the Agent) having
Percentages aggregating 66-2/3% or more.
Resource Control Note means the non-recourse note owed by
the Sludge Composting Facility of Resource Control Composting
Inc. to the Massachusetts Industrial Finance Agency, which note
is in the approximate principal amount of $9,400,000 as of the
Effective Date.
Restricted Investments means "Restricted Investments" as
defined in the Senior Note Agreement.
Royalties - see the definition of Contingent Payment.
SARA - see Section 9.15.1.
SEC means the Securities and Exchange Commission.
Secured Debt means any Debt of the Company or any Subsidiary
which is secured by a Lien on any property of the Company or any
Subsidiary.
Senior Funded Debt means all Funded Debt of the Company and
its Subsidiaries excluding Subordinated Debt.
Senior Funded Debt to Cash Flow Ratio means the ratio of (i)
Senior Funded Debt as of the last day of any Computation Period
to (ii) Consolidated Net Income for such Computation Period plus,
to the extent deducted in determining such Consolidated Net
Income, Interest Expense, income tax expense, depreciation and
amortization for such Computation Period.
Senior Notes means the $ 75,000,000 initial principal amount
of 7.67% senior secured notes due September 1, 2005, issued by
the Company pursuant to the Secured Note Agreement, dated as of
September 1, 1995, among the Company and the purchasers named
therein.
Senior Note Agreement means the Secured Note Agreement,
dated as of September 1, 1995, among the Company and the
purchasers named therein, as in effect on the Effective Date.
Stated Amount means, with respect to any Letter of Credit at
any date of determination, the maximum aggregate amount available
for drawing thereunder at any time during the then ensuing term
of such Letter of Credit under any and all circumstances, plus
the aggregate amount of all unreimbursed payments and
disbursements under such Letter of Credit.
Subordinated Debt means (i) Permitted Subordinated Debt and
(ii) any other unsecured indebtedness of the Company which (x) is
owed to Persons other than officers, employees, directors or
Affiliates of the Company, (y) has no amortization prior to
December 6, 2000 and (z) has subordination terms and covenants
approved by the Required Banks, the approval of which shall not
be unreasonably withheld.
Subordinated Notes means the $150,000,000 initial principal
amount of convertible subordinated notes due June 1, 2001, issued
by the Company pursuant to the Subordinated Note Indenture.
Subordinated Note Indenture means the Indenture, dated as
of June 5, 1996, among the Company and Bankers Trust Company, as
Trustee.
Subsidiary means, with respect to any Person, a corporation
of which such Person and/or its other Subsidiaries own, directly
or indirectly, such number of outstanding shares as have more
than 50% of the ordinary voting power for the election of
directors; provided, however, that except for purposes of
Sections 10.6 and 10.7, no Methane Disposal Subsidiary shall be
considered a Subsidiary of the Company for purposes of this
Agreement. Unless the context otherwise requires, each reference
to Subsidiaries herein shall be a reference to Subsidiaries of
the Company.
Termination Date means the earlier to occur of (a) December
4, 1999 or such later date to which the Termination Date may be
extended at the request of the Company and with the consent of
each Bank or (b) such other date on which the Commitments shall
terminate pursuant to Section 6 or 12.
Type of Loan or Borrowing - see Section 2.2.1. The types of
Loans or borrowings under this Agreement are as follows:
Floating Rate Loans or borrowings and Eurodollar Loans or
borrowings.
Unmatured Event of Default means any event that, if it
continues uncured, will, with lapse of time or notice or both,
constitute an Event of Default.
Welfare Plan means a "welfare plan", as such term is defined
in Section 3(1) of ERISA.
SECTION 2 COMMITMENTS OF THE BANKS; LETTER OF CREDIT,
BORROWING AND CONVERSION PROCEDURES.
2.1 Commitments. On and subject to the terms and
conditions of this Agreement, each of the Banks, severally and
for itself alone, agrees to make loans to, and to issue or
participate in the issuance of letters of credit for the account
of, the Company as follows:
2.1.1 Loan Commitment. Each Bank will make loans on a
revolving basis ("Loans") from time to time before the
Termination Date in such Bank's Percentage of such aggregate
amounts as the Company may from time to time request from all
Banks; provided that the aggregate principal amount of all Loans
which all Banks shall be committed to have outstanding at any one
time shall not exceed the excess, if any, of (a) $190,000,000, as
such amount may be reduced from time to time pursuant to
Section 6.1 (as so reduced, the "Commitment Amount"), over (b)
the Stated Amount of all outstanding Letters of Credit.
2.1.2 L/C Commitment. (a) BAI will issue standby letters
of credit, in each case containing such terms and conditions as
are permitted by this Agreement and are reasonably satisfactory
to BAI (each, a "Letter of Credit"), at the request of and for
the account of the Company or any Subsidiary from time to time
before the Termination Date and (b) as more fully set forth in
Section 2.3.5, each Bank agrees to purchase a participation in
each such Letter of Credit; provided that the aggregate Stated
Amount of all Letters of Credit shall not at any time exceed the
lesser of (i) $90,000,000 and (ii) the excess, if any of the
Commitment Amount over the aggregate principal amount of all
outstanding Loans.
2.2 Loan Procedures.
2.2.1 Various Types of Loans. Each Loan shall be either a
Floating Rate Loan or a Eurodollar Loan (each a "type" of Loan),
as the Company shall specify in the related notice of borrowing
or conversion pursuant to Section 2.2.2 or 2.2.3. Eurodollar
Loans having the same Interest Period are sometimes called a
"Group" or collectively "Groups". Floating Rate Loans and
Eurodollar Loans may be outstanding at the same time, provided
that (i) not more than eight different Groups of Loans shall be
outstanding at any one time and (ii) the aggregate principal
amount of each Group of Eurodollar Loans shall at all times be at
least $1,000,000 and an integral multiple of $500,000. All
borrowings, conversions and repayments of Loans shall be effected
so that each Bank will have a pro rata share (according to its
Percentage) of all types and Groups of Loans.
2.2.2 Borrowing Procedures. The Company shall give written
notice or telephonic notice (followed immediately by written
confirmation thereof) to the Agent of each proposed borrowing not
later than (a) in the case of a Floating Rate borrowing,
10:00 A.M., Chicago time, on the proposed date of such borrowing,
and (b) in the case of a Eurodollar borrowing, 10:00 A.M.,
Chicago time, at least three Business Days prior to the proposed
date of such borrowing. Each such notice shall be effective upon
receipt by the Agent, shall be irrevocable, and shall specify the
date, amount and type of borrowing and, in the case of a
Eurodollar borrowing, the initial Interest Period therefor.
Promptly upon receipt of such notice, the Agent shall advise each
Bank thereof. Not later than 1:00 p.m., Chicago time, on the
date of a proposed borrowing, each Bank shall provide the Agent
at the office specified by the Agent with immediately available
funds covering such Bank's Percentage of such borrowing and, so
long as the Agent has not received written notice that the
conditions precedent set forth in Section 11 with respect to such
borrowing have not been satisfied (and does not have knowledge of
any default in the payment of any principal, interest or fees to
be paid to the Agent for the account of the Banks), the Agent
shall pay over the requested amount to the Company on the
requested borrowing date. Each borrowing shall be on a Business
Day. Each Floating Rate borrowing shall be in an aggregate
amount of at least $300,000 and an integral multiple of $100,000.
2.2.3 Procedures for Conversion of Type of Loan. Subject
to the provisions of Section 2.2.1, the Company may convert all
or any part of any outstanding Loan into a Loan of a different
type by giving written notice or telephonic notice (followed
immediately by written confirmation thereof) to the Agent not
later than (a) in the case of conversion into a Floating Rate
Loan, 10:00 A.M., Chicago time, on the proposed date of such
conversion, and (b) in the case of a conversion into a Eurodollar
Loan, 10:00 A.M., Chicago time, at least three Business Days
prior to the proposed date of such conversion. Each such notice
shall be effective upon receipt by the Agent, shall be
irrevocable, and shall specify the date and amount of such
conversion, the Loan to be so converted, the type of Loan to be
converted into and, in the case of a conversion into a Eurodollar
Loan, the initial Interest Period therefor. Promptly upon
receipt of such notice, the Agent shall advise each Bank thereof.
Subject to Section 2.5, such Loan shall be so converted on the
requested date of conversion. Each conversion shall be on a
Business Day. Each conversion of a Eurodollar Loan on a day
other than the last day of an Interest Period therefor shall be
subject to the provisions of Section 8.4.
2.3 Letter of Credit Procedures.
2.3.1 L/C Applications. The Company shall give notice to
the Agent (which shall promptly inform BAI) of the proposed
issuance of each Letter of Credit on a Business Day which is at
least five Business Days prior to the proposed date of issuance
of such Letter of Credit. Each such notice shall be accompanied
by an L/C Application, duly executed by the Company (together
with any Subsidiary for the account of which the related Letter
of Credit is to be issued) and in all respects satisfactory to
the Agent and BAI, together with such other documentation as the
Agent or BAI may request in support thereof, it being understood
that each L/C Application shall specify, among other things, the
date on which the proposed Letter of Credit is to be issued, the
expiration date of such Letter of Credit (which shall not be
later than the Termination Date) and whether such Letter of
Credit is to be transferable in whole or in part. So long as BAI
has not received written notice that the conditions precedent set
forth in Section 11 with respect to the issuance of such Letter
of Credit have not been satisfied (and does not have knowledge of
any default in the payment of any principal, interest or fees to
be paid to the Agent for the account of the Banks), BAI shall
issue such Letter of Credit on the requested issuance date.
2.3.2 Participation in Letters of Credit. Concurrently
with the issuance of each Letter of Credit, BAI shall be deemed
to have sold and transferred to each other Bank, and each other
Bank shall be deemed irrevocably and unconditionally to have
purchased and received from BAI, without recourse or warranty, an
undivided interest and participation, to the extent of such other
Bank's Percentage, in such Letter of Credit and the Company's
reimbursement obligations with respect thereto. For the purposes
of this Agreement, the unparticipated portion of each Letter of
Credit shall be deemed to be BAI's "participation" therein. BAI
hereby agrees, upon request of any Bank, to deliver to such Bank
a list of all outstanding Letters of Credit, together with such
information related thereto as such Bank may reasonably request.
2.3.3 Reimbursement Obligations. The Company hereby
unconditionally and irrevocably agrees to reimburse BAI for each
payment or disbursement made by BAI under any Letter of Credit
honoring any demand for payment made by the beneficiary
thereunder, in each case on the date that such payment or
disbursement is made. Any amount not reimbursed on the date of
such payment or distribution shall bear interest from and
including the date of such payment or disbursement to but not
including the date that BAI is reimbursed by the Company
therefor, payable on demand, at a rate per annum equal to the
Alternate Reference Rate from time to time in effect plus 3% per
annum. BAI shall notify the Company whenever any demand for
payment is made under any Letter of Credit by the beneficiary
thereunder; provided, however, that the failure of BAI to so
notify the Company shall not affect the rights of BAI or the
Banks in any manner whatsoever.
2.3.4 Limitation on BAI's Obligations. In determining
whether to pay under any Letter of Credit, BAI shall have no
obligation to the Company or any Bank other than to confirm that
any documents required to be delivered under such Letter of
Credit appear to have been delivered and appear to comply on
their face with the requirements of such Letter of Credit. Any
action taken or omitted to be taken by BAI under or in connection
with any Letter of Credit, if taken or omitted in the absence of
gross negligence and willful misconduct, shall not impose upon
BAI any liability to the Company or any Bank and shall not reduce
or impair the Company's reimbursement obligations set forth in
Section 2.3.3 or the obligations of the Banks pursuant to Section
2.3.5.
2.3.5 Funding by Banks to BAI. If BAI makes any payment or
disbursement under any Letter of Credit and the Company has not
reimbursed BAI in full for such payment or disbursement by 11:00
A.M., Chicago time, on the date of such payment or disbursement,
or if any reimbursement received by BAI from the Company is or
must be returned or rescinded upon or during any bankruptcy or
reorganization of the Company or otherwise, each other Bank shall
be obligated to pay to BAI, in full or partial payment of the
purchase price of its participation in such Letter of Credit, its
pro rata share (according to its Percentage) of such payment or
disbursement (but no such payment shall diminish the obligations
of the Company under Section 2.3.3), and the Agent shall promptly
notify each other Bank thereof. Each other Bank irrevocably and
unconditionally agrees to so pay to the Agent in immediately
available funds for BAI's account the amount of such other Bank's
Percentage of such payment or disbursement. If and to the extent
any Bank shall not have made such amount available to the Agent
by 2:00 P.M., Chicago time, on the Business Day on which such
Bank receives notice from the Agent of such payment or
disbursement (it being understood that any such notice received
after noon, Chicago time, on any Business Day shall be deemed to
have been received on the next following Business Day), such Bank
agrees to pay interest on such amount to the Agent for BAI's
account forthwith on demand for each day from and including the
date such amount was to have been delivered to the Agent to but
excluding the date such amount is paid, at a rate per annum equal
to (a) for the first three days after demand, the Federal Funds
Rate from time to time in effect and (b) thereafter, the
Alternate Reference Rate from time to time in effect. Any Bank's
failure to make available to the Agent its Percentage of any such
payment or disbursement shall not relieve any other Bank of its
obligation hereunder to make available to the Agent such other
Bank's Percentage of such payment, but no Bank shall be
responsible for the failure of any other Bank to make available
to the Agent such other Bank's Percentage of any such payment or
disbursement.
2.4 Commitments Several. The failure of any Bank to make a
requested Loan on any date shall not relieve any other Bank of
its obligation to make a Loan on such date, but no Bank shall be
responsible for the failure of any other Bank to make any Loan to
be made by such other Bank.
2.5 Certain Conditions. Notwithstanding any other
provision of this Agreement, no Bank shall have an obligation to
make any Loan, or to permit the continuation of or any conversion
into any Eurodollar Loan, and BAI shall have no obligation to
issue any Letter of Credit, if an Event of Default or Unmatured
Event of Default exists.
SECTION 3 NOTES EVIDENCING LOANS.
3.1 Notes. The Loans of each Bank shall be evidenced by a
promissory note (as amended, supplemented, replaced or otherwise
modified from time to time, each a "Note") substantially in the
form set forth in Exhibit A, with appropriate insertions, payable
to the order of such Bank in an amount equal to such Bank's
Percentage of the Loan Commitment (or, if less, in the aggregate
unpaid principal amount of such Bank's Loans).
3.2 Recordkeeping. Each Bank shall record in its records,
or at its option on the schedule attached to its Note, the date
and amount of each Loan made by such Bank, each repayment or
conversion thereof and, in the case of each Eurodollar Loan, the
dates on which each Interest Period for such Loan shall begin and
end. The aggregate unpaid principal amount so recorded shall be
rebuttable presumptive evidence of the principal amount owing and
unpaid on such Note. The failure to so record any such amount or
any error in so recording any such amount shall not, however,
limit or otherwise affect the obligations of the Company
hereunder or under any Note to repay the principal amount of the
Loans evidenced by such Note together with all interest accruing
thereon.
SECTION 4 INTEREST.
4.1 Interest Rates. The Company promises to pay interest
on the unpaid principal amount of each Loan for the period
commencing on the date of such Loan until such Loan is paid in
full as follows:
(a) at all times while such Loan is a Floating Rate
Loan, at a rate per annum equal to the sum of the Alternate
Reference Rate from time to time in effect plus the Floating
Rate Margin (determined as set forth in Schedule I) from
time to time in effect; and
(b) at all times while such Loan is a Eurodollar Loan,
at a rate per annum equal to the sum of the Eurodollar Rate
(Reserve Adjusted) applicable to each Interest Period for
such Loan plus the Eurodollar Margin (determined as set
forth in Schedule I) from time to time in effect;
provided, however, that at any time an Event of Default exists,
the interest rate applicable to each Loan shall be increased by
2%.
4.2 Interest Payment Dates. Accrued interest on each
Floating Rate Loan shall be payable in arrears on the last day of
each calendar month and at maturity. Accrued interest on each
Eurodollar Loan shall be payable on the last day of each Interest
Period relating to such Loan (and, in the case of a Eurodollar
Loan with a six-month Interest Period, on the three-month
anniversary of the first day of such Interest Period) and at
maturity. After maturity, accrued interest on all Loans shall be
payable on demand.
4.3 Interest Periods. Each "Interest Period" for a
Eurodollar Loan shall commence on the date such Eurodollar Loan
is made or converted from a Floating Rate Loan, or on the
expiration of the immediately preceding Interest Period for such
Eurodollar Loan, and shall end on the date which is one, two,
three or six months thereafter, as the Company may specify:
(a) in the case of an Interest Period which commences
on the date a Eurodollar Loan is made or converted from a
Floating Rate Loan, in the related notice of borrowing or
conversion pursuant to Section 2.2.2 or 2.2.3, or
(b) in the case of a succeeding Interest Period with
respect to any Eurodollar Loan, by written notice or
telephonic notice (followed immediately by written
confirmation thereof) to the Agent not later than 10:00
A.M., Chicago time, at least three Business Days prior to
the first day of such succeeding Interest Period, it being
understood that (i) each such notice shall be effective upon
receipt by the Agent and (ii) if the Company fails to give
such notice, such Loan shall automatically become a Floating
Rate Loan at the end of its then-current Interest Period.
Each Interest Period that begins on the last day of a calendar
month (or on a day for which there is no numerically
corresponding day in the appropriate subsequent calendar month)
shall end on the last Business Day of the appropriate subsequent
calendar month. Each Interest Period which would otherwise end
on a day which is not a Business Day shall end on the immediately
succeeding Business Day (unless such immediately succeeding
Business Day is the first Business Day of a calendar month, in
which case such Interest Period shall end on the immediately
preceding Business Day). The Company may not select any Interest
Period for a Loan which would end after the scheduled Termination
Date.
4.4 Setting and Notice of Eurodollar Rates. The applicable
Eurodollar Rate for each Interest Period shall be determined by
the Agent, and notice thereof shall be given by the Agent
promptly to the Company and each Bank. Each determination of the
applicable Eurodollar Rate by the Agent shall be conclusive and
binding upon the parties hereto, in the absence of demonstrable
error. The Agent shall, upon written request of the Company or
any Bank, deliver to the Company or such Bank a statement showing
the computations used by the Agent in determining any applicable
Eurodollar Rate hereunder.
4.5 Computation of Interest. Interest shall be computed
for the actual number of days elapsed on the basis of a year of
360 days. The applicable interest rate for each Floating Rate
Loan shall change simultaneously with each change in the
Alternate Reference Rate.
SECTION 5 FEES.
5.1 Non-Use Fee. The Company agrees to pay to the Agent
for the account of each Bank a non-use fee, for the period from
and including the Effective Date to but excluding the Termination
Date, at the rate per annum in effect from time to time pursuant
to Schedule I of the daily average of the unused amount of such
Bank's Percentage of the Commitment Amount. For purposes of
calculating usage under this Section, the Commitment Amount shall
be deemed used to the extent of the aggregate principal amount of
all outstanding Loans plus the undrawn amount of all Letters of
Credit. Such non-use fee shall be payable in arrears on the last
day of each calendar quarter and on the Termination Date for any
period then ending for which such non-use fee shall not have
theretofore been paid. The non-use fee shall be computed for the
actual number of days elapsed on the basis of a year of 360 days.
5.2 Letter of Credit Fees. (a) The Company agrees to pay
to the Agent for the account of the Banks pro rata according to
their respective Percentages a letter of credit fee for each
Letter of Credit in an amount equal to the rate per annum in
effect from time to time pursuant to Schedule I of the undrawn
amount of such Letter of Credit (computed for the actual number
of days elapsed on the basis of a year of 360 days); provided
that the rate applicable to each Letter of Credit shall be
increased by 2% at any time that an Event of Default exists.
Such letter of credit fee shall be payable in arrears on the last
day of each calendar quarter and on the Termination Date for the
period from and including the date of the issuance of each Letter
of Credit to but excluding the date such payment is due or, if
earlier, the date on which such Letter of Credit expired or was
terminated.
(b) In addition, with respect to each Letter of Credit, the
Company agrees to pay to BAI, for its own account, (i) such fees
and expenses as BAI customarily requires in connection with the
issuance, negotiation, processing and/or administration of
letters of credit in similar situations and (ii) a letter of
credit fee in the amount separately agreed to by the Company and
BAI.
5.3 Agent's Fees. The Company agrees to pay to the Agent
such arrangement and agent's fees as are mutually agreed to from
time to time by the Company and the Agent.
SECTION 6 REDUCTION AND TERMINATION OF THE COMMITMENTS;
PREPAYMENTS.
6.1 Reduction or Termination of the Commitments. The
Company may from time to time on at least five Business Days'
prior written notice received by the Agent (which shall promptly
advise each Bank thereof) permanently reduce the Commitment
Amount to an amount not less than the sum of the aggregate unpaid
principal amount of the Loans and the aggregate Stated Amount of
all Letters of Credit. Any such reduction shall be in an amount
not less than $5,000,000 and an integral multiple thereof. The
Company may at any time on like notice terminate the Commitments
upon payment in full of all Loans and all other obligations of
the Company hereunder and cash collateralization in full,
pursuant to documentation in form and substance satisfactory to
the Banks, of all obligations arising with respect to the Letters
of Credit. All reductions of the Commitment Amount shall reduce
the Commitments pro rata among the Banks according to their
respective Percentages.
6.2 Voluntary Prepayments. The Company may from time to
time prepay the Loans in whole or in part, provided that (a) the
Company shall give the Agent (which shall promptly advise each
Bank) notice thereof not later than 10:00 A.M. (Chicago time) on
the day of such prepayment, specifying the Loans to be prepaid
and the date and amount of prepayment, (b) each partial
prepayment shall be in a principal amount of at least $100,000
and an integral multiple of $100,000 and (c) any prepayment of a
Eurodollar Loan on a day other than the last day of an Interest
Period therefor shall be subject to Section 8.4.
SECTION 7 MAKING AND PRORATION OF PAYMENTS; SETOFF; TAXES.
7.1 Making of Payments. All payments of principal of or
interest on the Notes, and of all non-use fees and Letter of
Credit fees, shall be made by the Company to the Agent in
immediately available funds at the office specified by the Agent
not later than noon, Chicago time, on the date due; and funds
received after that hour shall be deemed to have been received by
the Agent on the next following Business Day. The Company hereby
authorizes and instructs the Agent to charge the Company's demand
deposit account no. 78-13155 (or such other account as the
Company may specify from time to time) maintained with BAI for
the amount of any such payment on the due date therefor, and
(subject to there being a sufficient balance in such account for
such purpose) the Agent agrees to do so, provided that the
Agent's failure to so charge such account shall in no way affect
the obligation of the Company to make any such payment. The
Agent shall promptly remit to each Bank or other holder of a Note
its share of all such payments received in collected funds by the
Agent for the account of such Bank or holder.
All payments under Section 8.1 shall be made by the Company
directly to the Bank entitled thereto.
7.2 Application of Certain Payments. Each payment of
principal shall be applied to such Loans as the Company shall
direct by notice to be received by the Agent on or before the
date of such payment or, in the absence of such notice, as the
Agent shall determine in its discretion. Concurrently with each
remittance to any Bank of its share of any such payment, the
Agent shall advise such Bank as to the application of such
payment.
7.3 Due Date Extension. If any payment of principal or
interest with respect to any of the Notes, or of non-use fees or
Letter of Credit fees, falls due on a day which is not a Business
Day, then such due date shall be extended to the immediately
following Business Day (unless, in the case of a Eurodollar Loan,
such immediately following Business Day is the first Business Day
of a calendar month, in which case such date shall be the
immediately preceding Business Day) and, in the case of
principal, additional interest shall accrue and be payable for
the period of any such extension.
7.4 Setoff. The Company agrees that the Agent, each Bank
and each other holder of a Note have all rights of set-off and
bankers' lien provided by applicable law, and in addition
thereto, the Company agrees that at any time (a) any payment or
other amount owing by the Company under this Agreement is then
due to the Agent, any Bank or any such holder or (b) any
Unmatured Event of Default under Section 12.1.4 or any Event of
Default exists, the Agent, each Bank and each such holder may
apply to the payment of such payment or other amount (or, in the
case of clause (b), to any obligations of the Company hereunder,
whether or not then due) any and all balances, credits, deposits,
accounts or moneys of the Company then or thereafter with the
Agent, such Bank or such holder.
7.5 Proration of Payments. If any Bank shall obtain any
payment or other recovery (whether voluntary, involuntary, by
application of offset or otherwise) on account of principal of or
interest on any Note (or an account of its participation in any
Letter of Credit) in excess of its pro rata share of payments and
other recoveries obtained by all Banks on account of principal of
and interest on Notes (or such participation) then held by them,
such Bank shall purchase from the other Banks such participation
in the Notes (or sub-participation in Letters of Credit) held by
them as shall be necessary to cause such purchasing Bank 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 Bank, the purchase shall be rescinded and the purchase
price restored to the extent of such recovery.
7.6 Taxes. All payments of principal of, and interest on,
the Loans and all other amounts payable hereunder 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 franchise taxes
and taxes imposed on or measured by any Bank's net income or
receipts (all non-excluded items being called "Taxes"). If any
withholding or deduction from any payment to be made by the
Company hereunder is required in respect of any Taxes pursuant to
any applicable law, rule or regulation, then the Company will:
(a) pay directly to the relevant authority the full
amount required to be so withheld or deducted;
(b) promptly forward to the Agent an official receipt
or other documentation satisfactory to the Agent evidencing
such payment to such authority; and
(c) pay to the Agent for the account of the Banks such
additional amount or amounts as is necessary to ensure that
the net amount actually received by each Bank will equal the
full amount such Bank would have received had no such
withholding or deduction been required.
Moreover, if any Taxes are directly asserted against the Agent or
any Bank with respect to any payment received by the Agent or
such Bank hereunder, the Agent or such Bank may pay such Taxes
and the Company will promptly pay such additional amounts
(including any penalty, interest and expense) 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 such Taxes not been asserted.
If the Company fails to pay any Taxes when due to the
appropriate taxing authority or fails to remit to the Agent, for
the account of the respective Banks, the required receipts or
other required documentary evidence, the Company shall indemnify
the Banks for any incremental Taxes, interest or penalties that
may become payable by any Bank as a result of any such failure.
For purposes of this Section 7.6, a distribution hereunder by the
Agent or any Bank to or for the account of any Bank shall be
deemed a payment by the Company.
Upon the request from time to time of the Company or the
Agent, each Bank that is organized under the laws of a
jurisdiction other than the United States of America shall
execute and deliver to the Company and the Agent one or more (as
the Company or the Agent may reasonably request) United States
Internal Revenue Service Forms 4224 or Forms 1001 or such other
forms or documents, appropriately completed, as may be applicable
to establish the extent, if any, to which a payment to such Bank
is exempt from withholding or deduction of Taxes.
The obligations of the Company under this Section 7.6 are
subject to the limitation set out in Section 14.9.1.
SECTION 8 INCREASED COSTS; SPECIAL PROVISIONS FOR
EURODOLLAR LOANS.
8.1 Increased Costs. (a) If, after the date hereof, the
adoption of any applicable law, rule or regulation, or any change
therein, or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof,
or compliance by any Bank (or any Eurodollar Office of such Bank)
with any request or directive (whether or not having the force of
law) of any such authority, central bank or comparable agency
(A) shall subject any Bank (or any Eurodollar Office
of such Bank) to any tax, duty or other charge with respect
to its Eurodollar Loans, its Note or its obligation to make
Eurodollar Loans, or shall change the basis of taxation of
payments to any Bank of the principal of or interest on its
Eurodollar Loans or any other amounts due under this
Agreement in respect of its Eurodollar Loans or its
obligation to make Eurodollar Loans (except for changes in
the rate of tax on the overall net income of such Bank or
its Eurodollar Office imposed by the jurisdiction in which
such Bank's principal executive office or Eurodollar Office
is located); or
(B) shall impose, modify or deem applicable any
reserve (including any reserve imposed by the Board of
Governors of the Federal Reserve System, but excluding any
reserve included in the determination of interest rates
pursuant to Section 4), special deposit or similar
requirement against assets of, deposits with or for the
account of, or credit extended by any Bank (or any
Eurodollar Office of such Bank); or
(C) shall impose on any Bank (or its Eurodollar
Office) any other condition affecting its Eurodollar Loans,
its Note or its obligation to make Eurodollar Loans;
and the result of any of the foregoing is to increase the cost to
(or in the case of Regulation D of the Board of Governors of the
Federal Reserve System, to impose a cost on) such Bank (or any
Eurodollar Office of such Bank) of making or maintaining any
Eurodollar Loan, or to reduce the amount of any sum received or
receivable by such Bank (or its Eurodollar Office) under this
Agreement or under its Note with respect thereto, then within 10
days after demand by such Bank (which demand shall be accompanied
by a statement setting forth the basis for such demand, a copy of
which shall be furnished to the Agent), the Company shall pay
directly to such Bank such additional amount as will compensate
such Bank for such increased cost or such reduction.
(b) If any Bank shall reasonably determine that the
adoption or phase-in of any applicable law, rule or regulation
regarding capital adequacy, or any change therein, or any change
in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance
by any Bank or any Person controlling such Bank with any request
or directive regarding capital adequacy (whether or not having
the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the
rate of return on such Bank's or such controlling Person's
capital as a consequence of such Bank's obligations hereunder
(including such Bank's obligations under the Loan Commitment or
the L/C Commitment) or under any Letter of Credit to a level
below that which such Bank or such controlling Person could have
achieved but for such adoption, change or compliance (taking into
consideration such Bank's or such controlling Person's policies
with respect to capital adequacy) by an amount deemed by such
Bank or such controlling Person to be material, then from time to
time, within 10 days after demand by such Bank (which demand
shall be accompanied by a statement setting forth the basis for
such demand, a copy of which shall be furnished to the Agent),
the Company shall pay to such Bank such additional amount or
amounts as will compensate such Bank or such controlling Person
for such reduction.
8.2 Basis for Determining Interest Rate Inadequate or
Unfair. If with respect to any Interest Period:
(a) deposits in Dollars (in the applicable amounts)
are not being offered to the Agent in the interbank
eurodollar market for such Interest Period, or the Agent
otherwise reasonably determines (which determination shall
be binding and conclusive on the Company) that by reason of
circumstances affecting the interbank eurodollar market
adequate and reasonable means do not exist for ascertaining
the applicable Eurodollar Rate; or
(b) Banks having an aggregate Percentage of 30% or
more advise the Agent that the Eurodollar Rate (Reserve
Adjusted) as determined by the Agent will not adequately and
fairly reflect the cost to such Banks of maintaining or
funding such Loans for such Interest Period (taking into
account any amount to which such Banks may be entitled under
Section 8.1) or that the making or funding of Eurodollar
Loans has become impracticable as a result of an event
occurring after the date of this Agreement which in the
opinion of such Banks materially affects such Loans;
then the Agent shall promptly notify the other parties thereof
and, so long as such circumstances shall continue, (i) no Bank
shall be under any obligation to make or convert into Eurodollar
Loans and (ii) on the last day of the current Interest Period for
each Eurodollar Loan, such Loan shall, unless then repaid in
full, automatically convert to a Floating Rate Loan.
8.3 Changes in Law Rendering Eurodollar Loans Unlawful. In
the event that any change in (including the adoption of any new)
applicable laws or regulations, or any change in the
interpretation of applicable laws or regulations by any
governmental or other regulatory body charged with the
administration thereof, should make it (or in the good faith
judgment of any Bank cause a substantial question as to whether
it is) unlawful for any Bank to make, maintain or fund Eurodollar
Loans, then such Bank shall promptly notify each of the other
parties hereto and, so long as such circumstances shall continue,
(a) such Bank shall have no obligation to make or convert into
Eurodollar Loans (but shall make Floating Rate Loans concurrently
with the making of or conversion into Eurodollar Loans by the
Banks which are not so affected, in each case in an amount equal
to such Bank's pro rata share of all Eurodollar Loans which would
be made or converted into at such time in the absence of such
circumstances) and (b) on the last day of the current Interest
Period for each Eurodollar Loan of such Bank (or, in any event,
on such earlier date as may be required by the relevant law,
regulation or interpretation), such Eurodollar Loan shall, unless
then repaid in full, automatically convert to a Floating Rate
Loan. Each Floating Rate Loan made by a Bank which, but for the
circumstances described in the foregoing sentence, would be a
Eurodollar Loan (an "Affected Loan") shall remain outstanding for
the same period as the Group of Eurodollar Loans of which such
Affected Loan would be a part absent such circumstances.
8.4 Funding Losses. The Company hereby agrees that upon
demand by any Bank (which demand shall be accompanied by a
statement setting forth the basis for the amount being claimed, a
copy of which shall be furnished to the Agent), the Company will
indemnify such Bank against any net loss or expense which such
Bank may sustain or incur (including any net loss or expense
incurred by reason of the liquidation or reemployment of deposits
or other funds acquired by such Bank to fund or maintain any
Eurodollar Loan), as reasonably determined by such Bank, as a
result of (a) any payment, prepayment or conversion of any
Eurodollar Loan of such Bank on a date other than the last day of
an Interest Period for such Loan (including any conversion
pursuant to Section 8.3) or (b) any failure of the Company to
borrow or convert any Loan on a date specified therefor in a
notice of borrowing or conversion pursuant to this Agreement.
For this purpose, all notices to the Agent pursuant to this
Agreement shall be deemed to be irrevocable.
8.5 Right of Banks to Fund through Other Offices. Each
Bank may, if it so elects, fulfill its commitment as to any
Eurodollar Loan by causing a foreign branch or affiliate of such
Bank to make such Loan, provided that in such event for the
purposes of this Agreement such Loan shall be deemed to have been
made by such Bank and the obligation of the Company to repay such
Loan shall nevertheless be to such Bank and shall be deemed held
by it, to the extent of such Loan, for the account of such branch
or affiliate.
8.6 Discretion of Banks as to Manner of Funding.
Notwithstanding any provision of this Agreement to the contrary,
each Bank shall be entitled to fund and maintain its funding of
all or any part of its Loans in any manner it sees fit, it being
understood, however, that for the purposes of this Agreement all
determinations hereunder shall be made as if such Bank had
actually funded and maintained each Eurodollar Loan during each
Interest Period for such Loan through the purchase of deposits
having a maturity corresponding to such Interest Period and
bearing an interest rate equal to the Eurodollar Rate for such
Interest Period.
8.7 Mitigation of Circumstances; Replacement of Affected
Bank. (a) Each Bank shall promptly notify the Company and the
Agent of any event of which it has knowledge which will result
in, and will use reasonable commercial efforts available to it
(and not, in such Bank's good faith judgment, otherwise
disadvantageous to such Bank) to mitigate or avoid, (i) any
obligation by the Company to pay any amount pursuant to Section
7.6 or 8.1 or (ii) the occurrence of any circumstances of the
nature described in Section 8.2 or 8.3 (and, if any Bank has
given notice of any such event described in clause (i) or (ii)
above and thereafter such event ceases to exist, such Bank shall
promptly so notify the Company and the Agent). Without limiting
the foregoing, each Bank will designate a different funding
office if such designation will avoid (or reduce the cost to the
Company of) any event described in clause (i) or (ii) of the
preceding sentence and such designation will not, in such Bank's
sole judgment, be otherwise disadvantageous to such Bank.
(b) At any time any Bank is an Affected Bank, the Company
may replace such Affected Bank as a party to this Agreement with
one or more other bank(s) or financial institution(s) reasonably
satisfactory to the Agent (and upon notice from the Company such
Affected Bank shall assign pursuant to an Assignment Agreement,
and without recourse or warranty, its Commitment, its Loans, its
Note, its participation in Letters of Credit, and all of its
other rights and obligations hereunder to such replacement
bank(s) or other financial institution(s) for a purchase price
equal to the sum of the principal amount of the Loans so
assigned, all accrued and unpaid interest thereon, its ratable
share of all accrued and unpaid non-use fees and Letter of Credit
fees, any amounts payable under Section 8.4 as a result of such
Bank receiving payment of any Eurodollar Loan prior to the end of
an Interest Period therefor and all other obligations owed to
such Affected Bank hereunder).
8.8 Conclusiveness of Statements; Survival of Provisions.
Determinations and statements of any Bank pursuant to Section
8.1, 8.2, 8.3 or 8.4 shall be conclusive absent demonstrable
error. Banks may use reasonable averaging and attribution
methods in determining compensation under Sections 8.1 and 8.4,
and the provisions of such Sections shall survive repayment of
the Loans, cancellation of the Notes, cancellation or expiration
of the Letters of Credit and any termination of this Agreement.
SECTION 9 WARRANTIES.
To induce BAI to issue Letters of Credit and to induce the
Agent and the Banks to enter into this Agreement and to induce
the Banks to make Loans and purchase participation in Letters of
Credit hereunder, the Company warrants to the Agent and the Banks
that:
9.1 Organization, etc. The Company is a corporation duly
organized, validly existing and in good standing under the laws
of the State of Delaware; each Subsidiary is a corporation duly
organized, validly existing and in good standing under the laws
of the state of its incorporation; and the Company and each
Subsidiary is duly qualified to do business in each jurisdiction
where the nature of its business makes such qualification
necessary (except in those instances in which the failure to be
qualified or in good standing does not materially adversely
affect the financial condition, operations, assets, business,
properties or prospects of the Company and the Subsidiaries taken
as a whole) and has full power and authority to own its property
and conduct its business as presently conducted by it.
9.2 Authorization; No Conflict. The execution and delivery
by the Company of this Agreement and each other Loan Document to
which it is a party, the borrowings hereunder, the execution and
delivery by each Guarantor of each Loan Document to which it is a
party and the performance by each of the Company and each
Guarantor of its obligations under each Loan Document to which it
is a party are within the corporate powers of the Company and
each Guarantor, have been duly authorized by all necessary
corporate action on the part of the Company and each Guarantor
(including any necessary shareholder action), have received all
necessary governmental approval (if any shall be required), and
do not and will not (a) violate any provision of law or any
order, decree or judgment of any court or other government agency
which is binding on the Company or any Guarantor, (b) contravene
or conflict with, or result in a breach of, any provision of the
Certificate of Incorporation, By-Laws or other organizational
documents of the Company or any Guarantor or of any agreement,
indenture, instrument or other document which is binding on the
Company, any Guarantor or any other Subsidiary or (c) result in,
or require, the creation or imposition of any Lien on any
property of the Company, any Guarantor or any other Subsidiary
(other than Liens arising under the Loan Documents).
9.3 Validity and Binding Nature. Each of this Agreement
and each other Loan Document to which the Company is a party is
the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms; and
each Loan Document to which any Guarantor is a party is, or upon
the execution and delivery thereof by such Guarantor will be, the
legal, valid and binding obligation of such Guarantor,
enforceable against such Guarantor in accordance with its terms.
9.4 Financial Information. The audited consolidated
financial statements of the Company and its Subsidiaries at
December 31, 1995 and the unaudited consolidated financial
statements of the Company and its Subsidiaries at June 30, 1996,
copies of each of which have been delivered to each Bank, have
been prepared in accordance with generally accepted accounting
principles and present fairly the consolidated financial
condition of the Company and its Subsidiaries taken as a whole as
at such dates and the results of their operations for the periods
then ended.
9.5 No Material Adverse Change. Since the date of the
unaudited consolidated financial statements described in
Section 9.4, there has been no material adverse change in the
financial condition, operations, assets, business, properties or
prospects of the Company and its Subsidiaries taken as a whole.
9.6 Litigation and Contingent Liabilities. (a) No
litigation (including derivative actions), arbitration
proceeding, labor controversy or governmental investigation or
proceeding is pending or, to the Company's knowledge, threatened
against the Company or any Subsidiary which might reasonably be
expected to materially and adversely affect the financial
condition, operations, assets, business, properties or prospects
of the Company and its Subsidiaries taken as a whole, except as
set forth in Item 9.6(a) ("Litigation and Contingent
Liabilities") of Schedule II. Other than any liability incident
to such litigation or proceedings, neither the Company nor any
Subsidiary has any material contingent liabilities not provided
for or disclosed in the financial statements referred to in
Section 9.4 or listed in such Item 9.6(a) or in Item 9.6(b) of
Schedule II.
(b) Item 9.6(b) ("Royalties and Other Contingent Payments")
sets out descriptions of all arrangements existing on the
Effective Date pursuant to which the Company or any Subsidiary
may be required to pay any Royalty or other Contingent Payment.
9.7 Ownership of Properties; Liens. Each of the Company
and each Subsidiary owns good and marketable title to all of its
properties and assets, real and personal, tangible and
intangible, of any nature whatsoever (including patents,
trademarks, trade names, service marks and copyrights), free and
clear of all Liens, charges and claims (including infringement
claims with respect to patents, trademarks, copyrights and the
like) except as permitted pursuant to Section 10.8.
9.8 Subsidiaries. The Company has no Subsidiaries except
those listed in Item 9.8 of Schedule II.
9.9 Pension and Welfare Plans. (a) During the twelve-consecutive
- -month period prior to the date of the execution and
delivery of this Agreement or the making of any Loan hereunder,
(i) no steps have been taken to terminate any Pension Plan and
(ii) no contribution failure has occurred with respect to any
Pension Plan sufficient to give rise to a lien under Section
302(f) of ERISA. No condition exists or event or transaction has
occurred with respect to any Pension Plan which could result in
the incurrence by the Company of any material liability, fine or
penalty. The Company has no contingent liability with respect to
any post-retirement benefit under a Welfare Plan, other than
liability for continuation coverage described in Part 6 of
Subtitle B of Title I of ERISA.
(b) All contributions (if any) have been made to any
Multiemployer Pension Plan that are required to be made by the
Company or any other member of the Controlled Group under the
terms of the plan or of any collective bargaining agreement or by
applicable law; neither the Company nor any member of the
Controlled Group has withdrawn or partially withdrawn from any
Multiemployer Pension Plan, incurred any withdrawal liability
with respect to any such plan, received notice of any claim or
demand for withdrawal liability or partial withdrawal liability
from any such plan, and no condition has occurred which, if
continued, might result in a withdrawal or partial withdrawal
from any such plan; and neither the Company nor any member of the
Controlled Group has received any notice that any Multiemployer
Pension Plan is in reorganization, that increased contributions
may be required to avoid a reduction in plan benefits or the
imposition of any excise tax, that any such plan is or has been
funded at a rate less than that required under Section 412 of the
Code, that any such plan is or may be terminated, or that any
such plan is or may become insolvent.
9.10 Investment Company Act. Neither the Company nor any
Subsidiary is an "investment company" or a company "controlled"
by an "investment company", within the meaning of the Investment
Company Act of 1940, as amended.
9.11 Public Utility Holding Company Act. Neither the
Company nor any Subsidiary is a "holding company", or a
"subsidiary company" of a "holding company", or an "affiliate" of
a "holding company" or of a "subsidiary company" of a "holding
company", within the meaning of the Public Utility Holding
Company Act of 1935, as amended.
9.12 Regulation U. The Company is not engaged principally,
or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying Margin
Stock.
9.13 Taxes. Each of the Company and each Subsidiary has
filed all tax returns and reports required by law to have been
filed by it and has paid all taxes and governmental charges
thereby shown to be owing, except any such taxes or charges which
are being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with
generally accepted accounting principles shall have been set
aside on its books.
9.14 Solvency, etc. On the Effective Date (or, in the case
of any Person which becomes a Guarantor after the Effective Date,
on the date such Person becomes a Guarantor), and immediately
prior to and after giving effect to the issuance of each Letter
of Credit and each borrowing hereunder and the use of the
proceeds thereof, (a) each of the Company's and each Guarantor's
assets will exceed its liabilities and (b) each of the Company
and each Guarantor will be solvent, will be able to pay its debts
as they mature, will own property with fair saleable value
greater than the amount required to pay its debts and will have
capital sufficient to carry on its business as then constituted.
9.15 Environmental Compliance.
9.15.1 No Violations. Except as set forth in Item 9.15.1
of Schedule II, neither the Company nor any of the Subsidiaries,
nor any operator of the Company's or any Subsidiaries'
properties, is in violation, or alleged violation (other than any
allegation arising solely out of an Immaterial Notice), of any
judgment, decree, order, law, permit, license, rule or regulation
pertaining to environmental matters, including those arising
under the Resource Conservation and Recovery Act as amended
("RCRA"), the Comprehensive Environmental Response, Compensation
and Liability Act of 1980 as amended ("CERCLA"), the Superfund
Amendments and Reauthorization Act of 1986 ("SARA"), the Federal
Clean Water Act, the Federal Clean Air Act, the Toxic Substances
Control Act, or any other Federal, state or local statute,
regulation, ordinance, order or decree relating to health,
safety, waste transportation, handling, storage or disposal, or
the environment (collectively, "Environmental Laws"), (i) any of
which violations singly requires expenditures in any three-year
period of $300,000 or more by the Company and its Subsidiaries in
penalties and/or for investigative, removal or remedial actions
or (ii) which violations singly or in the aggregate otherwise
might reasonably be expected to have a material adverse effect on
the business, assets or financial condition of the Company and
its Subsidiaries on a consolidated basis.
9.15.2 Notices. Except as set forth in Item 9.15.2 of
Schedule II, neither the Company nor any of the Subsidiaries has
received notice (other than an Immaterial Notice) from any third
party, including any Federal, state or local governmental
authority: (a) that any one of them has been identified by the
United States Environmental Protection Agency ("EPA") as a
potentially responsible party under CERCLA with respect to a site
listed on the National Priorities List, 40 C.F.R. Part 300
Appendix B; (b) that any hazardous waste, as defined by 42 U.S.C.
Subsection 6903(5), any hazardous substances as defined by 42 U.S.C.
Subsection 9601(14), any pollutant or contaminant as defined by 42 U.S.C.
Subsection 9601(33) and any toxic substance, oil or hazardous materials or
other chemicals or substances regulated by any Environmental
Laws, excluding household hazardous waste ("Hazardous
Substances") which any one of them has generated, transported or
disposed of has been found at any site at which a Federal, state
or local agency or other third party has conducted a remedial
investigation, removal or other response action pursuant to any
Environmental Law; (c) that the Company or any Subsidiary must
conduct a remedial investigation, removal, response action or
other activity pursuant to any Environmental Law; or (d) that it
is or shall be a named party to any claim, action, cause of
action, complaint, legal or administrative proceeding arising out
of any third party's incurrence of costs, expenses, losses or
damages of any kind whatsoever in connection with the release of
Hazardous Substances.
9.15.3 Handling of Hazardous Substances. Except as set
forth in Item 9.15.3 of Schedule II: (a) no portion of the Real
Property or other assets of the Company or any Subsidiary has
been used for the handling, processing, storage or disposal of
Hazardous Substances except in accordance in all material
respects with applicable Environmental Laws (other than any
Immaterial Law); and no underground tank or other underground
storage receptacle for Hazardous Substances is located on such
properties; (b) in the course of any activities conducted by the
Company, any Subsidiary or operators of the Real Property, no
Hazardous Substances have been generated or are being used on
such properties except in accordance in all material respects
with applicable Environmental Laws (other than any Immaterial
Law); (c) there have been no unpermitted Releases or threatened
Releases of Hazardous Substances on, upon, into or from the Real
Property or other assets of the Company or any Subsidiary, which
Releases singly or in the aggregate might reasonably be expected
to have a material adverse effect on the value of such
properties; (d) to the best of the Company's knowledge on the
basis of reasonable inquiry, there have been no Releases on,
upon, from or into any real property in the vicinity of the Real
Property or other assets of the Company and the Subsidiaries
which, through soil or groundwater contamination, may have come
to be located on, and which might reasonably be expected to have
a material adverse effect on the value of the Real Property or
other assets of the Company or Subsidiaries; and (e) in addition,
any Hazardous Substances generated by the Company and the
Subsidiaries have been transported offsite only by properly
licensed carriers and delivered only to treatment or disposal
facilities maintaining valid permits as required under applicable
Environmental Laws, which transporters and facilities have been
and are, to the best of the Company's knowledge, operating in
compliance with such permits and applicable Environmental Laws.
9.15.4 Clean-Ups. Except as set forth in Item 9.15.4 of
Schedule II, none of the Real Property or other assets of the
Company or any Subsidiary is or shall be subject to any
applicable environmental clean-up responsibility law or
environmental restrictive transfer laws or regulation, by virtue
of the transactions set forth herein and contemplated hereby.
9.15.5 Permits and Governmental Authority. All permits or
other governmental authorizations required for the siting,
construction and operation of all landfills and transfer stations
currently owned or operated by the Company and the Subsidiaries
have been obtained and remain in full force and effect and are
not subject to any appeals or further proceedings or to any
unsatisfied conditions that may allow material modification or
revocation. The Company and the Subsidiaries are not in
violation of any such permits.
9.15.6 Investigations. The Company and its Subsidiaries
have taken all reasonable steps to investigate the past and
present condition and usage of the Real Properties and the
operations conducted by the Company and its Subsidiaries.
9.15.7 Updating of Schedule II. The Company may from time
to time by notice to the Agent and each Bank amend Items 9.15.1,
9.15.2, 9.15.3 and 9.15.4 of Schedule II to reflect events or
circumstances occurring, or discovered by the Company, subsequent
to the Effective Date, provided that no such amendment shall be
effective if prior to the 30th day after such notice is received,
the Required Banks inform the Company that they are unwilling to
permit such amendment.
9.16 Information. All information heretofore or
contemporaneously herewith furnished by the Company or any
Subsidiary to any Bank for purposes of or in connection with this
Agreement and the transactions contemplated hereby is, and all
information hereafter furnished by or on behalf of the Company or
any Subsidiary to any Bank pursuant hereto or in connection
herewith will be, true and accurate in every material respect on
the date as of which such information is dated or certified, and
none of such information is or will be incomplete by omitting to
state any material fact necessary to make such information not
misleading.
SECTION 10 COVENANTS.
Until the expiration or termination of the Commitments and
thereafter until all obligations of the Company hereunder and
under the other Loan Documents are paid in full and all Letters
of Credit have been terminated, the Company agrees that, unless
at any time the Required Banks shall otherwise expressly consent
in writing, it will:
10.1 Reports, Certificates and Other Information. Furnish
to the Agent and each Bank:
10.1.1 Audit Report. Promptly when available and in any
event within 90 days after the close of each Fiscal Year: (a) a
copy of the annual audit report of the Company and its
Subsidiaries for such Fiscal Year, including therein consolidated
balance sheets of the Company and its Subsidiaries as of the end
of such Fiscal Year and consolidated statements of earnings and
cash flow of the Company and its Subsidiaries for such Fiscal
Year certified without qualification by Ernst & Young or other
independent auditors of recognized standing selected by the
Company and reasonably acceptable to the Required Banks, together
with a written statement from such accountants to the effect that
in making the examination necessary for the signing of such
annual audit report by such accountants, they have not become
aware of any Event of Default or Unmatured Event of Default that
has occurred and is continuing or, if they have become aware of
any such event, describing it in reasonable detail; and (b)
consolidating balance sheets of the Company and its Subsidiaries
as of the end of such Fiscal Year and consolidating statements of
earnings and cash flows for the Company and its Subsidiaries for
such Fiscal Year, certified by the Chief Financial Officer or the
Vice President, Finance of the Company.
10.1.2 Quarterly Reports. Promptly when available and in
any event within 45 days after the end of each Fiscal Quarter
(except the last Fiscal Quarter) of each Fiscal Year, the
consolidated balance sheet of the Company and its Subsidiaries as
of the end of such Fiscal Quarter, together with the consolidated
statements of earnings and consolidated statements of cash flow
for such Fiscal Quarter and for the period beginning with the
first day of such Fiscal Year and ending on the last day of such
Fiscal Quarter, certified by the Chief Financial Officer or the
Vice President, Finance of the Company.
10.1.3 Compliance Certificates. Contemporaneously with the
furnishing of a copy of each annual audit report pursuant to
Section 10.1.1 and of each set of quarterly statements pursuant
to Section 10.1.2, a duly completed certificate in the form of
Exhibit B, with appropriate insertions, dated the date of such
annual report or such quarterly statements and signed by the
Chief Financial Officer or the Vice President, Finance of the
Company, containing a computation of each of the financial ratios
and restrictions set forth in Section 10.6 and in Schedule I
hereto, and to the effect that such officer has not become aware
of any Event of Default or Unmatured Event of Default that has
occurred and is continuing or, if there is any such event,
describing it and the steps, if any, being taken to cure it.
10.1.4 Reports to SEC and to Shareholders. Promptly upon
the filing or sending thereof, a copy of any annual, periodic or
special report or registration statement (inclusive of exhibits
thereto) filed with the SEC or any securities exchange and any
report, proxy statement or other communication to the Company's
shareholders generally.
10.1.5 Notice of Default, Litigation and ERISA Matters.
Immediately upon becoming aware of any of the following, written
notice describing the same and the steps being taken by the
Company or the Subsidiary affected thereby with respect thereto:
(a) the occurrence of an Event of Default or an
Unmatured Event of Default;
(b) any litigation, arbitration or governmental
investigation or proceeding not previously disclosed by the
Company to the Banks which has been instituted or, to the
knowledge of the Company, is threatened against the Company
or any Subsidiary or to which any of the properties of any
thereof is subject which, if adversely determined, might
reasonably be expected to materially adversely affect the
financial condition, operations, assets, business,
properties or prospects of the Company and its Subsidiaries,
taken as a whole, or might reasonably be expected to
materially impair the ability of the Company or any
Subsidiary to perform its obligations under any Loan
Document;
(c) the institution of any steps by any member of the
Controlled Group or any other Person to terminate any
Pension Plan, or the failure of any member of the Controlled
Group to make a required contribution to any Pension Plan
(if such failure is sufficient to give rise to a lien under
Section 302(f) of ERISA) or to any Multiemployer Pension
Plan, or the taking of any action with respect to a Pension
Plan which could result in the requirement that the Company
furnish a bond or other security to the PBGC or such Pension
Plan, or the occurrence of any event with respect to any
Pension Plan or Multiemployer Pension Plan which could
result in the incurrence by any member of the Controlled
Group of any material liability, fine or penalty (including
any claim or demand for withdrawal liability or partial
withdrawal from any Multiemployer Pension Plan), or any
material increase in the contingent liability of the Company
with respect to any post-retirement Welfare Plan benefit, or
any notice that any Multiemployer Pension Plan is in
reorganization, that increased contributions may be required
to avoid a reduction in plan benefits or the imposition of
an excise tax, that any such plan is or has been funded at a
rate less than that required under Section 412 of the Code,
that any such plan is or may be terminated, or that any such
plan is or may become insolvent;
(d) any cancellation or material change in any
insurance maintained by the Company or any Subsidiary;
(e) any violation of any Environmental Law regarding
the Real Property or the Company's or any Subsidiary's
operations which violation might reasonably be expected to
have a material adverse effect on the Real Property or on
the Company's or any Subsidiary's operations;
(f) any potential or known Release, or threat of
Release, of any Hazardous Substance at, from, or into the
Real Property which it reports in writing or is reportable
by it in writing to any governmental authority and which is
material in amount or nature or which could materially
affect the value of the Real Property;
(g) the Company's or any Subsidiary's receipt of any
notice (other than an Immaterial Notice) of violation of any
Environmental Laws or of any Release or threatened Release
of Hazardous Substances, including a notice or claim of
liability or potential responsibility from any third party
(including any Federal, state or local governmental
officials) and including notice of any formal inquiry,
proceeding, demand, investigation or other action with
regard to (i) the Company's or any Subsidiary's or any
Person's operation of the Real Property, (ii) contamination
on, from or into the Real Property, or (iii) investigation
or remediation of offsite locations at which the Company,
any Subsidiary or their respective predecessors are alleged
to have directly or indirectly Disposed of Hazardous
Substances;
(h) the Company's or any Subsidiary's receipt of any
notice (other than an Immaterial Notice) of the incurrence
by any third party (including any Federal, state or local
governmental authority) of any expense or loss in connection
with the assessment, containment, removal or remediation of
any Hazardous Substances with respect to which the Company
or any Subsidiary may be liable or for which a Lien may be
imposed on the Real Property; or
(i) any setoff, claims (including, with respect to the
Real Property, environmental claims) withholdings or other
defenses to which any of the Collateral, or the Banks'
rights with respect to the Collateral, are subject.
10.1.6 Subsidiaries. Upon delivery of the financial
reports pursuant to Section 10.1.1 and 10.1.2, a written report
reflecting all changes in the list of Subsidiaries, if any.
10.1.7 Management Reports. Promptly upon the request of
the Agent or any Bank, copies of all detailed financial and
management reports submitted to the Company by independent
auditors in connection with each annual or interim audit made by
such auditors of the books of the Company.
10.1.8 Projections. As soon as practicable and in any
event within 60 days after the commencement of each Fiscal Year,
the financial projections for the Company and its Subsidiaries
for such Fiscal Year prepared in a manner consistent with those
projections delivered by the Company to the Banks prior to the
Effective Date or otherwise in a manner satisfactory to the
Agent.
10.1.9 Other Information. From time to time such other
information concerning the Company and its Subsidiaries as any
Bank or the Agent may reasonably request.
10.2 Books, Records and Inspections. Keep, and cause each
Subsidiary to keep, its books and records in accordance with
sound business practices sufficient to allow the preparation of
financial statements in accordance with generally accepted
accounting principles; permit, and cause each Subsidiary to
permit, any Bank or the Agent or any representative thereof to
inspect the properties and operations of the Company and of such
Subsidiary; and permit, and cause each Subsidiary to permit, any
Bank or the Agent or any representative thereof to visit any or
all of its offices, to discuss its financial matters with its
officers and its independent auditors (and the Company hereby
authorizes such independent auditors to discuss such financial
matters with any Bank or the Agent or any representative thereof
whether or not any representative of the Company or any
Subsidiary is present), and to examine (and, at the expense of
the Company or the applicable Subsidiary, photocopy extracts
from) any of its books or other corporate records.
10.3 Insurance. Maintain, and cause each Subsidiary to
maintain, with responsible insurance companies, such insurance as
may be required by any law or governmental regulation or court
decree or order applicable to it and such other insurance, to
such extent and against such hazards and liabilities, as is
customarily maintained by companies similarly situated (it being
understood that such insurance may be provided by the Insurance
Subsidiary so long as the terms thereof are not less favorable to
the Company or the applicable Subsidiary than are obtainable from
a Person (other than the Insurance Subsidiary) which is engaged
in the insurance business); and, upon request of the Agent or any
Bank, furnish to the Agent or such Bank a certificate setting
forth in reasonable detail the nature and extent of all insurance
maintained by the Company and its Subsidiaries.
10.4 Compliance with Laws; Payment of Taxes and
Liabilities. (a) Comply, and cause each Subsidiary to comply, in
all material respects with all applicable laws (including
Environmental Laws), rules, regulations, decrees, orders,
judgments, licenses and permits, including all environmental
permits; and (b) pay, and cause each Subsidiary to pay, prior to
delinquency, all taxes and other governmental charges against it
or any of its property, as well as claims of any kind which, if
unpaid, might become a Lien on any of its property; provided,
however, that the foregoing shall not require the Company or any
Subsidiary to pay any such tax or charge so long as it shall
contest the validity thereof in good faith by appropriate
proceedings and shall set aside on its books adequate reserves
with respect thereto in accordance with generally accepted
accounting principles.
10.5 Maintenance of Existence, etc. Maintain and preserve,
and (subject to Section 10.12) cause each Subsidiary to maintain
and preserve, (a) its existence and good standing in the
jurisdiction of its incorporation, (b) its qualification and good
standing as a foreign corporation in each jurisdiction where the
nature of its business makes such qualification necessary (except
in those instances in which the failure to be qualified or in
good standing does not materially adversely affect the financial
condition, operations, assets, business, properties or prospects
of the Company and its Subsidiaries taken as a whole) and (c) all
material operating permits and other governmental authorizations
for all landfills and transfer stations now owned or hereafter
acquired.
10.6 Financial Covenants.
10.6.1 Minimum Net Worth. Not permit its Net Worth at the
end of any month to be less than the sum of (a) $250,000,000 plus
(b) 50% of Consolidated Net Income for the period beginning with
October 1, 1996 and ending on the last day of the most recently
ended Fiscal Quarter (provided that, if Consolidated Net Income
is less than zero for any Fiscal Quarter, for purposes of this
Section 10.6.1 Consolidated Net Income for such Fiscal Quarter
will be deemed to have been zero) plus (c) 100% of the net
proceeds of any equity issued by the Company or any of its
Subsidiaries (on a consolidated basis) after September 30, 1996.
10.6.2 Maximum Leverage. Not permit the ratio of (i)
Funded Debt to (ii) Funded Debt plus Net Worth to exceed 0.58 to
1.0 at the end of any Fiscal Quarter.
10.6.3 Minimum Interest Coverage. Not permit the Interest
Coverage Ratio to be less than 2.5 to 1 for any Computation
Period.
10.6.4 Funded Debt to Cash Flow Ratio. Not permit the
Funded Debt to Cash Flow Ratio as of the last day of any Fiscal
Quarter to exceed 3.75 to 1.0.
10.7 Limitations on Debt. Not, and not permit any
Subsidiary to, create, incur, assume or suffer to exist any Debt,
except:
(a) existing Debt identified in Item 10.7 of Schedule II;
(b) Debt of Subsidiaries to the Company;
(c) unsecured Debt of the Company to Subsidiaries;
(d) obligations in respect of the Loans, the L/C
Applications and the Letters of Credit;
(e) Permitted Subordinated Debt; and
(f) other Debt, in addition to Debt permitted by the
foregoing clauses (a) through (e), in an aggregate principal
amount not exceeding the sum of $50,000,000 plus 15% of
Adjusted Consolidated Net Worth; provided that the aggregate
principal amount of all Debt of Subsidiaries (other than
Debt permitted pursuant to clause (b) or (d) above) plus all
Secured Debt of the Company (other than the Senior Notes and
Secured Debt permitted by clause (d) above) shall not at any
time exceed 15% of Adjusted Consolidated Net Worth;
provided, however, that notwithstanding anything to the contrary
set forth in this Section 10.7, the aggregate principal amount of
all Debt incurred by any Methane Disposal Subsidiary shall not at
any time exceed $2,500,000;
10.8 Liens. Not, and not permit any Subsidiary to, create
or permit to exist any Lien on any of its real or personal
properties, assets or rights of whatsoever nature (whether now
owned or hereafter acquired), except:
(a) Liens for taxes or other governmental charges not at the
time delinquent or thereafter payable without penalty or
being contested in good faith by appropriate proceedings
and, in each case, for which it maintains adequate reserves;
(b) Liens arising in the ordinary course of business (such
as (i) Liens of carriers, warehousemen, mechanics and
materialmen and other similar Liens imposed by law and (ii)
Liens incurred in connection with worker's compensation,
unemployment compensation and other types of social security
(excluding Liens arising under ERISA) or in connection with
surety bonds, bids, performance bonds and similar
obligations) for sums not overdue or being contested in good
faith by appropriate proceedings and not involving any
deposits or advances or borrowed money or the deferred
purchase price of property or services, and, in each case,
for which it maintains adequate reserves;
(c) (i) Liens in existence on the Effective Date securing
the obligations of the Company or any of its Subsidiaries
with respect to Secured Debt permitted by clause (a) of
Section 10.7 and (ii) Liens securing the obligations of the
Company or any of its Subsidiaries with respect to Secured
Debt permitted by clauses (b), (d) and (f) of Section 10.7;
it being understood that Liens with respect to Debt incurred
pursuant to clause (d) of Section 10.7 may also secure the
Senior Notes;
(d) attachments, appeal bonds, judgments and other similar
Liens, for sums not exceeding $500,000 arising in connection
with court proceedings, provided that the execution or other
enforcement of such Liens is effectively stayed and claims
secured thereby are being actively contested in good faith
and by appropriate proceedings;
(e) easements, rights of way, restrictions, minor defects or
irregularities in title and other similar Liens not
interfering in any material respect with the ordinary
conduct of the business of the Company or any Subsidiary;
(f) cash collateral pledged to secure (I) obligations of the
Company or any Subsidiary in respect of performance, closure
and post-closure liabilities relating to landfills or
similar operations of the Company or such Subsidiary
(including amounts deposited in trust accounts or escrow
accounts for such purpose) or obligations of the Company or
any Subsidiary in respect of bonds related directly to such
liabilities, provided that the liabilities of the Company
and its Subsidiaries in connection with any such bonds
(other than in respect of such cash collateral) shall be
subordinated to the obligations of the Company hereunder in
a manner approved in writing by the Required Banks and the
aggregate amount of (x) all cash collateral pledged in
respect of such obligations plus (y) all Investments made by
the Company and its Subsidiaries in the Insurance Subsidiary
shall not at any time exceed $15,000,000, or (II)
obligations under letters of credit permitted by Section
10.7;
(g) the Lien created in favor of the Trustee (as defined
below) pursuant to Section 5.01 of the Trust Indenture (the
"Indenture"), dated as of April 1, 1995, between the
Michigan Strategic Fund and The First National Bank of
Boston, as Trustee (the "Trustee"), with respect to moneys
held in the Project Fund (as defined in the Indenture);
(h) Liens securing contingent indebtedness to the Michigan
Department of Natural Resources ("DNR") arising in
connection with grants made by DNR to the Company or any
Subsidiary to purchase equipment or to finance improvements
on real estate; provided that (i) the original cost of all
such equipment and improvements shall not exceed $2,500,000
and (ii) such Liens shall attach only to the equipment
acquired or the improvements made with the proceeds of such
grants; and
(i) Liens on the stock of, or other ownership interests of
the Company or any of its Subsidiaries in, any Methane
Disposal Subsidiary; it being understood that any such Lien
shall be permitted even if such Subsidiary no longer
qualifies as a Methane Disposal Subsidiary so long as the
only recourse to the Company or any other Subsidiary for the
Debt of such Subsidiary is limited to the Lien on the stock
or other ownership interest of such Subsidiary.
10.9 Capital Expenditures. Not, and not permit any
Subsidiary to, make or commit to make any capital expenditures in
any Fiscal Year unless, after giving effect to such capital
expenditures, the aggregate amount of all capital expenditures
made by the Company and its Subsidiaries during such Fiscal Year
shall not exceed the product of 2.25 multiplied by the sum of the
Company's and its Subsidiaries' consolidated depreciation and
amortization expenses for (i) the first three Fiscal Quarters of
such Fiscal Year and (ii) the last Fiscal Quarter of the previous
Fiscal Year.
10.10 Restricted Payments. Not, and not permit any
Subsidiary to, (a) declare or pay any dividends on any of its
capital stock (other than stock dividends), (b) purchase or
redeem any such stock or any warrants, options or other rights in
respect of such stock, (c) make any other distribution to
shareholders, (d) prepay, purchase, defease or redeem any
Subordinated Debt (e) prepay, purchase, defease, redeem or make
any other payment with respect to the Subordinated Notes except
any Permitted Subordinated Note Payment or (f) set aside funds
for any of the foregoing; provided that (x) any Subsidiary may
declare and pay dividends to the Company or to any other wholly-owned
Subsidiary and (y) so long as no Event of Default or
Unmatured Event of Default has occurred and is continuing (or
would result from such payment), the Company may pay not more
than $5,000,000 during the term of this Agreement to redeem
stock.
10.11 Mergers, Consolidations, Sales. Not, and not permit
any Subsidiary to, be a party to any merger or consolidation, or
purchase or otherwise acquire all or substantially all of the
assets or any stock of any class of, or any partnership or joint
venture interest in, any other Person, or, except in the ordinary
course of its business, sell, transfer, convey or lease all or
any substantial part of its assets, or sell or assign with or
without recourse any receivables, except for (a) any such merger
or consolidation, sale, transfer, conveyance, lease or assignment
of or by any wholly-owned Subsidiary into the Company or into,
with or to any other wholly-owned Subsidiary, provided, however,
that after giving effect to any merger of a Subsidiary into the
Company, there shall at all times remain pledged to the Agent the
stock of one or more Subsidiaries of the Company which own in the
aggregate no less than 90% of the net book value of the
consolidated assets of the Company and its Subsidiaries as of the
last day of the preceding Fiscal Year as reflected in the
financial reports required to be delivered pursuant to Section
10.1.1; (b) any such purchase or other acquisition by the Company
or any wholly-owned Subsidiary of the assets or stock of any
wholly-owned Subsidiary; (c) any such purchase or other
acquisition by the Company or any wholly-owned Subsidiary of the
assets or stock of any other Person where such assets (in the
case of an asset purchase) are for use, or such Person (in the
case of a stock purchase) is engaged, solely in the nonhazardous
waste disposal business and the aggregate consideration to be
paid by the Company and its Subsidiaries (including any Debt
assumed or issued in connection therewith, the amount thereof to
be calculated in accordance with GAAP, but excluding any stock of
the Company issued in connection therewith) in each such purchase
or other acquisition is less than $50,000,000; (d) with the
consent of the Required Banks, (i) any other purchase or other
acquisition by the Company or any wholly-owned Subsidiary of the
assets or stock of any other Person where such assets (in the
case of an asset purchase) are for use, or such Person (in the
case of a stock purchase) is engaged, solely in the nonhazardous
waste disposal business and (ii) any sale of all of the stock or
all or substantially all of the assets of any Subsidiary; (e) the
disposition of the stock or assets of the Sludge Composting
Facility of Resource Control Composting Inc. provided that (I)
the purchaser assumes the Resource Control Note and (II) the
consideration received by the Company or the applicable
Subsidiary for such disposition is not less than the book value
of such stock or assets; and (f) other sales and dispositions of
tangible assets so long as the net book value of all assets sold
or otherwise disposed of in any Fiscal Year does not exceed 10%
of the net book value of the consolidated assets of the Company
and its Subsidiaries as of the last day of the preceding Fiscal
Year.
10.12 Modification of Organizational Documents. Not permit
the Certificate of Incorporation, By-Laws or other organizational
documents of the Company or any Subsidiary to be amended or
modified in any way which might reasonably be expected to
materially adversely affect the interests of the Banks.
10.13 Use of Proceeds. Use the proceeds of the Loans
solely to refinance existing Debt, for acquisitions permitted by
Section 10.11 and for other general corporate purposes; and not
use or permit any proceeds of any Loan to be used, either
directly or indirectly, for the purpose, whether immediate,
incidental or ultimate, of "purchasing or carrying" any Margin
Stock.
10.14 Further Assurances. Take, and cause each Subsidiary
to take, such actions as the Agent or the Required Banks may
reasonably request from time to time (including the execution and
delivery of guaranties, pledge agreements, and other documents,
the filing or recording of any of the foregoing, and the delivery
of stock certificates) to ensure that the obligations of the
Company hereunder and under the other Loan Documents are at all
times secured by the stock of one or more Subsidiaries of the
Company which own in the aggregate no less than 90% of the net
book value of the consolidated assets of the Company and its
Subsidiaries as of the last day of the preceding Fiscal Year and
guaranteed by all of the Subsidiaries (including, promptly upon
the acquisition or creation thereof, any Subsidiary acquired or
created after the date hereof, but excluding the Insurance
Subsidiary) by execution of a counterpart of the Intercompany
Guaranty.
10.15 Transactions with Affiliates. Not, and not permit
any Subsidiary to, enter into, or cause, suffer or permit to
exist any transaction, arrangement or contract with any of its
other Affiliates (other than the Company and its Subsidiaries or
Disposal Services, Inc.) which is on terms which are less
favorable than are obtainable from any Person which is not one of
its Affiliates. Nothing in this Section 10.15 shall be deemed to
prohibit the loan to Robert Foley described in clause (h) of
Section 10.21.
10.16 Employee Benefit Plans. Maintain, and cause each
Subsidiary to maintain, each Pension Plan in substantial
compliance with all applicable requirements of law and
regulations.
10.17 Environmental Covenants.
10.17.1 Environmental Response Obligation. (a) If any
material Release or Disposal of Hazardous Substances shall occur
or shall have occurred on the Real Property or any other assets
of the Company or any Subsidiary, cause the prompt containment
and removal of such Hazardous Substances and remediation of the
Real Property or other assets as necessary to comply in all
material respects with all Environmental Laws (other than any
Immaterial Law) and to preserve the value of the Real Property or
other assets. Without limiting the generality of the foregoing,
the Company will comply, and cause each Subsidiary to comply, in
a reasonable and cost-effective manner with any valid Federal or
state judicial or administrative order requiring the performance
at any Real Property of activities in response to the release or
threatened release of a Hazardous Substance except for the period
of time that the Company or such Subsidiary is diligently and in
good faith contesting such order.
(b) Notify the Agent within ten days of the receipt of any
written claim, demand, proceeding, action, or notice of liability
or potential liability (other than an Immaterial Notice) by any
Person arising out of or relating to the release or threatened
release of a Hazardous Substance or failure to comply with any
Environmental Law where any such claim, demand, proceeding,
action, liability or failure to comply (i) singly might require
expenditures in any three-year period of $300,000 or more by the
Company and its Subsidiaries in penalties and/or for
investigations, removal or remedial measures or (ii) singly or in
the aggregate otherwise might reasonably be expected to have a
material adverse effect on the business, assets or financial
condition of the Company and its Subsidiaries on a consolidated
basis.
(c) Notify the Agent within ten days of any Release, threat
of release, or Disposal of Hazardous Substance reported to any
governmental regulatory authority at any Real Property.
(d) To the extent that the transportation of hazardous
waste as defined by RCRA is permitted by this Agreement, dispose,
and cause its Subsidiaries to dispose, of such hazardous waste
only at licensed disposal facilities operating, to the best of
the Company's or such Subsidiary's knowledge after reasonable
inquiry, in compliance with Environmental Laws.
10.17.2 Environmental Liabilities. Not violate in any
material respect any requirement of law regarding Hazardous
Substances (other than any Immaterial Law); and, without limiting
the foregoing, not commence Disposal of any Hazardous Substance
into or onto any Real Property nor allow any Lien imposed
pursuant to any law, regulation or order relating to Hazardous
Substances or the disposal thereof to remain on any Real Property
to the extent that it violates in any material respect any
applicable legal requirements (other than any Immaterial Law).
10.17.3 Closure and Post Closure Liabilities. Adequately
accrue, in accordance with generally accepted accounting
principles and as required by applicable Environmental Laws, all
closure and post closure liabilities with respect to the landfill
and transfer station operations conducted by the Company and the
Subsidiaries.
10.17.4 Real Property Acquisitions. Within 90 days after
close of any Fiscal Year (beginning after Fiscal Year 1997),
deliver to the Agent and each Bank copies of the environmental
reports and other information relied upon by the Company or any
Subsidiary in conducting its environmental due diligence with
respect to the acquisition of any landfill or similar property by
the Company or any Subsidiary during such Fiscal Year (it being
understood that the report delivered for Fiscal Year 1997 shall
include information for acquisitions made during December of
1996).
10.18 Unconditional Purchase Obligations. Not, and not
permit any Subsidiary to, enter into or be a party to any
contract for the purchase of materials, supplies or other
property or services, if such contract requires that payment be
made by it regardless of whether or not delivery is ever made of
such materials, supplies or other property or services.
10.19 Inconsistent Agreements. Not, and not permit any
Subsidiary to, enter into any agreement containing any provision
which would be violated or breached by any borrowing by the
Company hereunder or by the performance by the Company or any
Subsidiary of any of its obligations hereunder or under any other
Loan Document.
10.20 Business Activities. Not, and not permit any
Subsidiary to, engage in any line of business other than the
businesses engaged in by the Company and the Subsidiaries as of
the date hereof and businesses reasonably related thereto (but
excluding the transportation, storage or other handling of
Hazardous Substances except where permitted in connection with
and incidental to the normal transportation, storage and other
handling of non-hazardous waste), except that (a) Northern A-1
Sanitation Services, Inc. may continue to engage in the business
of the transportation, storage and handling of Hazardous
Substances in accordance with past practices (but may not expand
such practice) and (b) the Insurance Subsidiary may engage in the
business of providing insurance and bonding to the Company and
its Subsidiaries (and investing the proceeds of premiums received
for providing such insurance).
10.21 Advances and Other Investments. Not, and not permit
any Subsidiary to, make, incur, assume or suffer to exist any
Investment in any other Person, except (without duplication) the
following:
(a) equity Investments existing on the Effective Date in
wholly-owned Subsidiaries identified in Item 9.8 ("Existing
Subsidiaries") of Schedule II;
(b) equity Investments in Subsidiaries acquired after the
Effective Date in transactions permitted as acquisitions of
stock or assets pursuant to Section 10.11;
(c) in the ordinary course of business, contributions by the
Company to the capital of any of its Subsidiaries, or by any
such Subsidiary to the capital of any of its Subsidiaries;
(d) in the ordinary course of business, Investments by the
Company in any Subsidiary or by any of the Subsidiaries in
the Company, by way of intercompany loans, advances or
guaranties, all to the extent permitted by Section 10.7;
(e) advances, deposits and the like relating to prospective
acquisitions of businesses not exceeding an amount equal to
7-1/2% of Adjusted Consolidated Net Worth calculated as of
the most recently preceding Fiscal Quarter for which the
Agent has received the financial reports required to be
delivered pursuant to Section 10.1.1 or 10.1.2, as
applicable, at any time outstanding;
(f) Guaranties permitted by Section 10.7;
(g) Cash Equivalents;
(h) the loan by Resource Control, Inc. to Robert Foley
evidenced by the promissory note dated March 30, 1993 so
long as such note bears interest at a rate not less than
BAI's reference rate as in effect from time to time;
(i) Investments in Methane Disposal Subsidiaries; provided
however that all Investments made by the Company and its
Subsidiaries in Methane Disposal Subsidiaries shall not at
any time exceed $15,000,000; and
(j) other Investments, in addition to Investments permitted
by clauses (a) through (i) above; provided, that all
Investments permitted solely by this clause (j) shall not at
any time exceed $10,000,000.
provided, however, that (x) any Investment which when made
complies with the requirements of the definition of the term
"Cash Equivalents" may continue to be held notwithstanding that
such Investment if made thereafter would not comply with such
requirements; (y) no Investment otherwise permitted by clause
(b), (c), (d), (e) or (f) shall be permitted to be made if,
immediately before or after giving effect thereto, any Event of
Default or Unmatured Event of Default shall have occurred and be
continuing; and (z) the aggregate amount of (I) all cash
collateral pledged in respect of the obligations set forth in
Section 10.8(f)(I) plus (II) all Investments made by the Company
and its Subsidiaries in the Insurance Subsidiary (from and after
the formation thereof) shall not at any time exceed $15,000,000.
10.22 Operating Leases. Not, and not permit any Subsidiary
to, be party to Operating Leases requiring rental payments in
excess of $5,000,000 in the aggregate (excluding (x) intercompany
leases and (y) the lease described in Schedule 10.22 hereto in
any Fiscal Year for the Company and its Subsidiaries taken as a
whole.
10.23 Landfill Development. Not permit the aggregate
amount expended by the Company and the Subsidiaries in connection
with all greenfield landfill development projects (excluding any
landfill development project which is contiguous to, or an
expansion of, an existing landfill site) for which all applicable
permits to construct or improve such projects have not been
obtained to exceed $3,000,000.
SECTION 11 EFFECTIVENESS; CONDITIONS OF LENDING, ETC.
11.1 Effectiveness. This Agreement shall become effective,
and all outstanding Loans made and Letters of Credit issued under
the Existing Agreement shall be deemed to have been made and
issued (respectively) hereunder, on the date (the "Effective
Date") that the Agent shall have received (a) all amounts which
are then due and payable pursuant to Section 5 and (to the extent
billed) Section 14.6 and (b) all of the following, each duly
executed and dated the Effective Date (or such earlier date as
shall be satisfactory to the Agent), in form and substance
satisfactory to the Agent, and each (except for the Notes, of
which only the originals shall be signed) in sufficient number of
signed counterparts to provide one for each Bank:
11.1.1 Notes. The Notes.
11.1.2 Resolutions. Certified copies of resolutions of the
Board of Directors of the Company authorizing or ratifying the
execution, delivery and performance by the Company of this
Agreement, the Notes and the other Loan Documents to which the
Company is a party; and certified copies of resolutions of the
Board of Directors of each Subsidiary (if any) which is to
execute and deliver the Intercompany Guaranty pursuant to Section
11.1.5 authorizing or ratifying the execution, delivery and
performance by such Subsidiary of the Intercompany Guaranty.
11.1.3 Consents, etc. Certified copies of all
documents evidencing any necessary corporate action, consents and
governmental approvals (if any) required for the execution,
delivery and performance by the Company and each Subsidiary of
the documents referred to in this Section 11.
11.1.4 Incumbency and Signature Certificates. A
certificate of the Secretary or an Assistant Secretary of the
Company and each Subsidiary of the Company as of the Effective
Date certifying the names of the officer or officers of such
entity authorized to sign the Loan Documents to which such entity
is a party, together with a sample of the true signature of each
such officer (it being understood that the Agent and each Bank
may conclusively rely on each such certificate until formally
advised by a like certificate of any changes therein).
11.1.5 Intercompany Guaranty. A counterpart of the
Intercompany Guaranty executed by each Subsidiary (if any) as of
the Effective Date which has not previously executed a
counterpart thereof.
11.1.6 Opinions of Counsel for the Company and the
Guarantors. The opinions of (a) Wachtell, Lipton, Rosen & Katz,
special counsel to the Company and the Guarantors and (b) Oscar
D. Folger, counsel to the Company and the Guarantors.
11.1.7 Opinion of Counsel to the Agent. The opinion of
Mayer, Brown & Platt, special counsel to the Agent.
11.1.8 Confirmation from Guarantors, etc. Written
confirmation from each Guarantor that has previously signed the
Intercompany Guaranty or any other Loan Document that the
Intercompany Guaranty and each such Loan Document remains in full
force and effect with respect to such Guarantor.
11.1.9 Other. Such other documents as the Agent or any
Bank may reasonably request.
11.2 Conditions. The obligation (a) of each Bank to
make each Loan and (b) of BAI to issue each Letter of Credit is
subject to the following further conditions precedent that:
11.2.1 Compliance with Warranties, No Default, etc. Both
before and after giving effect to any borrowing and the issuance
of any Letter of Credit (but, if any Event of Default of the
nature referred to in Section 12.1.2 shall have occurred with
respect to any other Debt, without giving effect to the
application, directly or indirectly, of the proceeds thereof) the
following statements shall be true and correct:
(a) the representations and warranties of the Company
and the Guarantors set forth in this Agreement (excluding
Sections 9.6, 9.8 and 9.15) and the other Loan Documents
shall be true and correct in all material respects with the
same effect as if then made (except to the extent stated to
relate to an earlier date, in which case such
representations and warranties shall be true and correct in
all material respects as of such earlier date);
(b) except as disclosed by the Company to the Agent
and the Banks pursuant to Section 9.6
(i) no litigation (including derivative actions),
arbitration proceeding, labor controversy or
governmental investigation or proceeding shall be
pending or, to the knowledge of the Company, threatened
against the Company or any of its Subsidiaries which
might reasonably be expected to materially adversely
affect the Company's consolidated business, operations,
assets, revenues, properties or prospects or which
purports to affect the legality, validity or
enforceability of this Agreement, the Notes or any
other Loan Document; and
(ii) no development shall have occurred in any
litigation (including derivative actions), arbitration
proceeding, labor controversy or governmental
investigation or proceeding disclosed pursuant to
Section 9.6 which might reasonably be expected to
materially adversely affect the consolidated
businesses, operations, assets, revenues, properties or
prospects of the Company and its Subsidiaries; and
(c) no Event of Default or Unmatured Event of Default
shall have then occurred and be continuing, and neither the
Company nor any of its Subsidiaries shall be in violation of
any law or governmental regulation or court order or decree
where such violation or violations singly or in the
aggregate might reasonably be expected to materially
adversely affect the Company's consolidated business,
operations, assets, revenues, properties or prospects.
11.2.2 Confirmatory Certificate. If requested by the Agent
or any Bank, the Agent shall have received (in sufficient
counterparts to provide one to each Bank) a certificate dated the
date of such requested Loan or Letter of Credit and signed by a
duly authorized representative of the Company as to the matters
set out in Section 11.2.1 (it being understood that each request
by the Company for the making of a Loan or the issuance of a
Letter of Credit shall be deemed to constitute a warranty by the
Company that the conditions precedent set forth in Section 11.2.1
will be satisfied at the time of the making of such Loan or the
issuance of such Letter of Credit), together with such other
documents as the Agent or any Bank may reasonably request in
support thereof.
SECTION 12 EVENTS OF DEFAULT AND THEIR EFFECT.
12.1 Events of Default. Each of the following
shall constitute an Event of Default under this Agreement:
12.1.1 Non-Payment of the Loans, etc. Default in the
payment when due of the principal of any Loan; or default, and
continuance thereof for five days, in the payment when due of any
interest, fee, reimbursement obligation with respect to any
Letter of Credit or other amount payable by the Company hereunder
or under any other Loan Document.
12.1.2 Non-Payment of Other Debt. Any default shall occur
under the terms applicable to any Debt of the Company or any
Subsidiary in an aggregate amount (for all Debt so affected)
exceeding $5,000,000 and such default shall (a) consist of the
failure to pay such Debt when due (subject to any applicable
grace period), whether by acceleration or otherwise, or (b)
accelerate the maturity of such Debt or permit the holder or
holders thereof, or any trustee or agent for such holder or
holders, to cause such Debt to become due and payable prior to
its expressed maturity; provided, however, that for purposes of
this Section 12.1.2 only, the term "Debt" shall not include the
Resource Control Note.
12.1.3 Other Material Obligations. Default in the payment
when due, or in the performance or observance of, any material
obligation of, or condition agreed to by, the Company or any
Subsidiary with respect to any material purchase or lease of
goods or services where such default, singly or in the aggregate
with other such defaults might reasonably be expected to
materially adversely affect the Company's consolidated business,
operations, assets, revenues, properties or prospects (except
only to the extent that the existence of any such default is
being contested by the Company or such Subsidiary in good faith
and by appropriate proceedings and appropriate reserves have been
made in respect of such default).
12.1.4 Bankruptcy, Insolvency, etc. The Company or any
Subsidiary becomes insolvent or generally fails to pay, or admits
in writing its inability or refusal to pay, debts as they become
due; or the Company or any Subsidiary applies for, consents to,
or acquiesces in the appointment of a trustee, receiver or other
custodian for the Company or such Subsidiary or any property
thereof, or makes a general assignment for the benefit of
creditors; or, in the absence of such application, consent or
acquiescence, a trustee, receiver or other custodian is appointed
for the Company or any Subsidiary or for a substantial part of
the property of any thereof and is not discharged within 60 days;
or any bankruptcy, reorganization, debt arrangement, or other
case or proceeding under any bankruptcy or insolvency law, or any
dissolution or liquidation proceeding (except the voluntary
dissolution, not under any bankruptcy or insolvency law, of a
Subsidiary), is commenced in respect of the Company or any
Subsidiary, and if such case or proceeding is not commenced by
the Company or such Subsidiary, it is consented to or acquiesced
in by the Company or such Subsidiary, or remains for 60 days
undismissed; or the Company or any Subsidiary takes any corporate
action to authorize, or in furtherance of, any of the foregoing.
12.1.5 Non-Compliance with Provisions of This Agreement.
(a) Failure by the Company to comply with or to perform any
covenant set forth in Sections 10.5 through 10.13, 10.15 or
10.16; or (b) failure by the Company to comply with or to perform
any other provision of this Agreement (and not constituting an
Event of Default under any of the other provisions of this
Section 12) and continuance of such failure described in this
clause (b) for 30 days (or, in the case of Section 10.14, five
Business Days) after notice thereof to the Company from the
Agent, any Bank or the holder of any Note.
12.1.6 Warranties. Any warranty made by the Company herein
is breached or is false or misleading in any material respect, or
any schedule, certificate, financial statement, report, notice or
other writing furnished by the Company to the Agent or any Bank
is false or misleading in any material respect on the date as of
which the facts therein set forth are stated or certified.
12.1.7 Pension Plans. (i) Institution of any steps by the
Company or any other Person to terminate a Pension Plan if as a
result of such termination the Company could be required to make
a contribution to such Pension Plan, or could incur a liability
or obligation to such Pension Plan, in excess of $500,000; (ii) a
contribution failure occurs with respect to any Pension Plan
sufficient to give rise to a Lien under section 302(f) of ERISA;
or (iii) there shall occur any withdrawal or partial withdrawal
from a Multiemployer Pension Plan and the withdrawal liability
(without unaccrued interest) to Multiemployer Pension Plans as a
result of such withdrawal (including any outstanding withdrawal
liability that the Company and the Controlled Group have incurred
on the date of such withdrawal) exceeds $500,000.
12.1.8 Judgments. Final judgments which exceed an
aggregate of $500,000 shall be rendered against the Company, or
any Subsidiary and shall not have been discharged or vacated or
had execution thereof stayed pending appeal within 30 days after
entry or filing of such judgments.
12.1.9 Invalidity of Intercompany Guaranty, etc. The
Intercompany Guaranty shall cease to be in full force and effect
with respect to any Guarantor, any Guarantor shall fail (subject
to any applicable grace period) to comply with or to perform any
applicable provision of the Intercompany Guaranty, or any
Guarantor (or any Person by, through or on behalf of such
Guarantor) shall contest in any manner the validity, binding
nature or enforceability of the Intercompany Guaranty with
respect to such Guarantor.
12.1.10 Invalidity of Company Pledge Agreement The Company
Pledge Agreement shall cease to be in full force and effect with
respect to the Company, the Company shall fail (subject to any
applicable grace period) to comply with or to perform any
applicable provision of the Company Pledge Agreement or the
Company (or any Person by, through or on behalf of the Company)
shall contest in any manner the validity, binding nature or
enforceability of the Company Pledge Agreement.
12.1.11 Change in Control. (a) Any Person or group of
Persons (within the meaning of Section 13 or 14 of the Securities
Exchange Act of 1934, as amended, but excluding the executive
managers of the Company as of the Effective Date) shall acquire
beneficial ownership (within the meaning of Rule 13d-3
promulgated under such Act) of 25% or more of the outstanding
shares of common stock of the Company; or (b) during any 24-month
period, individuals who at the beginning of such period
constituted the Company's Board of Directors (together with any
new directors whose election by the Company's Board of Directors
or whose nomination for election by the Company's shareholders
was approved by a vote of at least two-thirds of the directors
who either were directors at beginning of such period or whose
election or nomination was previously so approved) cease for any
reason to constitute a majority of the Board of Directors of the
Company.
12.1.12 Material Environmental Events. There shall occur
or exist
(a) one or more circumstances or events of a type or
types referred to in Section 9.15 or 10.17 that is not
disclosed in Item 9.15.1, 9.15.2, 9.15.3 or 9.15.4 of
Schedule II, in the form attached hereto on the Effective
Date (and without giving effect to any amendments pursuant
to Section 9.15.7), and/or
(b) adverse developments with respect to one or more
of the matters disclosed in Item 9.15.1, 9.15.2, 9.15.3 or
9.15.4 of Schedule II, in the form attached hereto on the
Effective Date (and without giving effect to any amendments
pursuant to Section 9.15.7)
that, singly or in the aggregate, might reasonably be expected to
require expenditures by the Company and its Subsidiaries (on
account of fines, investigations, removal or remediation) in
excess of $5,000,000 in the period from the date hereof to the
scheduled Termination Date or that otherwise might reasonably be
expected to materially adversely affect the financial condition,
operations, assets, business, properties or prospects of the
Company and its Subsidiaries taken as a whole.
12.2 Effect of Event of Default. If any Event of Default
described in Section 12.1.4 shall occur, the Commitments (if they
have not theretofore terminated) shall immediately terminate and
the Notes and all other obligations hereunder shall become
immediately due and payable and the Company shall become
immediately obligated to deliver to the Agent cash collateral in
an amount equal to the outstanding face amount of all Letters of
Credit, all without presentment, demand, protest or notice of any
kind; and, in the case of any other Event of Default, the Agent
(upon written request of the Required Banks) shall declare the
Commitments (if they have not theretofore terminated) to be
terminated and/or declare all Notes and all other obligations
hereunder to be due and payable and/or demand that the Company
immediately deliver to the Agent cash collateral in amount equal
to the outstanding face amount of all Letters of Credit,
whereupon the Commitments (if they have not theretofore
terminated) shall immediately terminate and/or all Notes and all
other obligations hereunder shall become immediately due and
payable and/or the Company shall immediately become obligated to
deliver to the Agent cash collateral in an amount equal to the
face amount of all Letters of Credit, all without presentment,
demand, protest or notice of any kind. The Agent shall promptly
advise the Company of any such declaration, but failure to do so
shall not impair the effect of such declaration. Notwithstanding
the foregoing, the effect as an Event of Default of any event
described in Section 12.1.1 or Section 12.1.4 may be waived by
the written concurrence of all of the Banks, and the effect as an
Event of Default of any other event described in this Section 12
may be waived by the written concurrence of the Required Banks.
Any cash collateral delivered hereunder shall be held by the
Agent (without liability for interest thereon) and applied to
obligations arising in connection with any drawing under a Letter
of Credit. After the expiration or termination of all Letters of
Credit, such cash collateral shall be applied by the Agent to any
remaining obligations hereunder and any excess shall be delivered
to the Company or as a court of competent jurisdiction may elect.
SECTION 13 THE AGENT.
13.1 Appointment and Authorization. Each Bank hereby
irrevocably (subject to Section 13.9) appoints, designates and
authorizes the Agent to take such action on its behalf under the
provisions of this Agreement and each other Loan Document and to
exercise such powers and perform such duties as are expressly
delegated to it by the terms of this Agreement or any other Loan
Document, together with such powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary contained
elsewhere in this Agreement or in any other Loan Document, the
Agent shall not have any duties or responsibilities except those
expressly set forth herein, nor shall the Agent have or be deemed
to have any fiduciary relationship with any Bank, and no implied
covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against the Agent.
13.2 Delegation of Duties. The Agent may execute any of
its duties under this Agreement or any other Loan Document by or
through agents, employees or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining
to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it
selects with reasonable care.
13.3 Liability of Agent. None of the Agent-Related Persons
shall (i) be liable for any action taken or omitted to be taken
by any of them under or in connection with this Agreement or any
other Loan Document or the transactions contemplated hereby
(except for its own gross negligence or willful misconduct), or
(ii) be responsible in any manner to any of the Banks for any
recital, statement, representation or warranty made by the
Company or any Subsidiary or Affiliate of the Company, or any
officer thereof, contained in this Agreement or in any other Loan
Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by the Agent
under or in connection with, this Agreement or any other Loan
Document, or the validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan
Document, or for any failure of the Company or any other party to
any Loan Document to perform its obligations hereunder or
thereunder. No Agent-Related Person shall be under any
obligation to any Bank to ascertain or to inquire as to the
observance or performance of any of the agreements contained in,
or conditions of, this Agreement or any other Loan Document, or
to inspect the properties, books or records of the Company or any
of the Company's Subsidiaries or Affiliates.
13.4 Reliance by Agent. The Agent shall be entitled to
rely, and shall be fully protected in relying, upon any writing,
resolution, notice, consent, certificate, affidavit, letter,
telegram, facsimile, telex or telephone message, statement or
other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper
Person or Persons, and upon advice and statements of legal
counsel (including counsel to the Company), independent
accountants and other experts selected by the Agent. The Agent
shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it
shall first receive such advice or concurrence of the Required
Banks as it deems appropriate and, if it so requests,
confirmation from the Banks of their obligation to indemnify the
Agent against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such
action. The Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement or any
other Loan Document in accordance with a request or consent of
the Required Banks and such request and any action taken or
failure to act pursuant thereto shall be binding upon all of the
Banks.
13.5 Notice of Default. The Agent shall not be deemed to
have knowledge or notice of the occurrence of any Event of
Default or Unmatured Event of Default except with respect to
defaults in the payment of principal, interest and fees required
to be paid to the Agent for the account of the Banks, unless the
Agent shall have received written notice from a Bank or the
Company referring to this Agreement, describing such Event of
Default or Unmatured Event of Default and stating that such
notice is a "notice of default". The Agent will notify the Banks
of its receipt of any such notice. The Agent shall take such
action with respect to such Event of Default or Unmatured Event
of Default as may be requested by the Required Banks in
accordance with Section 12; provided, however, that unless and
until the Agent has received any such request, the Agent may (but
shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Event of Default or
Unmatured Event of Default as it shall deem advisable or in the
best interest of the Banks.
13.6 Credit Decision. Each Bank acknowledges that none of
the Agent-Related Persons has made any representation or warranty
to it, and that no act by the Agent hereinafter taken, including
any review of the affairs of the Company and its Subsidiaries,
shall be deemed to constitute any representation or warranty by
any Agent-Related Person to any Bank. Each Bank represents to
the Agent that it has, independently and without reliance upon
any Agent-Related Person and based on such documents and
information as it has deemed appropriate, made its own appraisal
of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of
the Company and its Subsidiaries, and all applicable bank
regulatory laws relating to the transactions contemplated hereby,
and made its own decision to enter into this Agreement and to
extend credit to the Company hereunder. Each Bank also
represents that it will, independently and without reliance upon
any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to
make its own credit analysis, appraisals and decisions in taking
or not taking action under this Agreement and the other Loan
Documents, and to make such investigations as it deems necessary
to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of
the Company. Except for notices, reports and other documents
expressly herein required to be furnished to the Banks by the
Agent, the Agent shall not have any duty or responsibility to
provide any Bank with any credit or other information concerning
the business, prospects, operations, property, financial or other
condition or creditworthiness of the Company which may come into
the possession of any of the Agent-Related Persons.
13.7 Indemnification. Whether or not the transactions
contemplated hereby are consummated, the Banks shall indemnify
upon demand the Agent-Related Persons (to the extent not
reimbursed by or on behalf of the Company and without limiting
the obligation of the Company to do so), pro rata, from and
against any and all Indemnified Liabilities; provided, however,
that no Bank shall be liable for any payment to the Agent-Related
Person of any portion of the Indemnified Liabilities resulting
solely from such Person's gross negligence or willful misconduct.
Without limitation of the foregoing, each Bank shall reimburse
the Agent upon demand for its ratable share of any costs or
out-of-pocket expenses (including reasonable fees of attorneys
for the Agent (including the allocable costs of internal legal
services and all disbursements of internal counsel)) incurred by
the Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise)
of, or legal advice in respect of rights or responsibilities
under, this Agreement, any other Loan Document, or any document
contemplated by or referred to herein, to the extent that the
Agent is not reimbursed for such expenses by or on behalf of the
Company. The undertaking in this Section shall survive repayment
of the Loans, cancellation of the Notes, any foreclosure under,
or any modification, release or discharge of, the Intercompany
Guaranty or the Company Pledge Agreement and the resignation or
replacement of the Agent.
For the purposes of this Section 13.7, "Indemnified
Liabilities" shall mean: any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses and disbursements (including reasonable fees of
attorneys for the Agent (including the allocable costs of
internal legal services and all disbursements of internal
counsel)) of any kind or nature whatsoever which may at any time
(including at any time following repayment of the Loan and the
termination, resignation or replacement of the Agent or the
replacement of any Bank) be imposed on, incurred by or asserted
against any Agent-Related Person in any way relating to or
arising out of this Agreement or any document contemplated by or
referred to herein, or the transactions contemplated hereby, or
any action taken or omitted by any such Person under or in
connection with any of the foregoing, including with respect to
any investigation, litigation or proceeding (including (a) any
case, action or proceeding before any court or other Governmental
Authority relating to bankruptcy, reorganization, insolvency,
liquidation, receivership, dissolution, winding-up or relief of
debtors, or (b) any general assignment for the benefit of
creditors, composition, marshalling of assets for creditors, or
other, similar arrangement in respect of its creditors generally
or any substantial portion of its creditors; undertaken under
U.S. Federal, state or foreign law, including the Bankruptcy
Code, and including any appellate proceeding) related to or
arising out of this Agreement or the Commitments or the use of
the proceeds thereof, whether or not any Agent-Related Person,
any Bank or any of their respective officers, directors,
employees, counsel, agents or attorneys-in-fact is a party
thereto.
13.8 Agent in Individual Capacity. BAI and its Affiliates
may make loans to, issue letters of credit for the account of,
accept deposits from, acquire equity interests in and generally
engage in any kind of banking, trust, financial advisory,
underwriting or other business with the Company and its
Subsidiaries and Affiliates as though BAI were not the Agent
hereunder and without notice to or consent of the Banks. The
Banks acknowledge that, pursuant to such activities, BAI or its
Affiliates may receive information regarding the Company or its
Affiliates (including information that may be subject to
confidentiality obligations in favor of the Company or such
Subsidiary) and acknowledge that the Agent shall be under no
obligation to provide such information to them. With respect to
their Loans, BAI and its Affiliates shall have the same rights
and powers under this Agreement as any other Bank and may
exercise the same as though BAI were not the Agent, and the terms
"Bank" and "Banks" include BAI and its Affiliates, to the extent
applicable, in their individual capacities.
13.9 Successor Agent; Assignment of Agency. (a) The Agent
may, and at the request of the Required Banks shall, resign as
Agent upon 30 days' notice to the Banks. If the Agent resigns
under this Agreement, the Required Banks shall, with (so long as
no Event of Default exists) the consent of the Company (which
shall not be unreasonably withheld or delayed), appoint from
among the Banks a successor agent for the Banks. If no successor
agent is appointed prior to the effective date of the resignation
of the Agent, the Agent may appoint, after consulting with the
Banks and the Company, a successor agent from among the Banks.
Upon the acceptance of its appointment as successor agent
hereunder, such successor agent shall succeed to all the rights,
powers and duties of the retiring Agent and the term "Agent"
shall mean such successor agent, and the retiring Agent's
appointment, powers and duties as Agent shall be terminated.
After any retiring Agent's resignation hereunder as Agent, the
provisions of this Section 13 and Sections 14.6 and 14.13 shall
inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent under this Agreement. If no
successor agent has accepted appointment as Agent by the date
which is 30 days following a retiring Agent's notice of
resignation, the retiring Agent's resignation shall nevertheless
thereupon become effective and the Banks shall perform all of the
duties of the Agent hereunder until such time, if any, as the
Required Banks appoint a successor agent as provided for above.
(b) The Agent may, at any time and from time to time,
without the consent of any other party to this Agreement, assign
and delegate to an Affiliate of the Agent (an "Affiliate Agent")
all of its rights, duties and obligations as Agent hereunder;
provided, however, that the Company and the Banks may continue to
deal solely and directly with the assignor Agent until written
notice of such assignment, together with payment office, address
for notice and related information with respect to the Affiliate
Agent, shall have been given to the Company and the Banks by the
Agent and the Affiliate Agent. From and after the date of such
written notice, (a) the Affiliate Agent shall be a party hereto,
shall be deemed to be the "Agent" hereunder and shall have the
rights, duties and obligations of the Agent hereunder and under
the Notes, and (b) the assignor Agent shall relinquish its rights
and be released from its duties and obligations as Agent
hereunder and under the Notes, provided, however, that the
provisions of this Section 13 and Sections 14.6 and 14.13 shall
inure to the benefit of the assignor Agent as to any actions
taken or omitted to be taken by it while it was Agent under this
Agreement.
13.10 Withholding Tax.
(a) If any Bank is a "foreign corporation, partnership
or trust" within the meaning of the Code and such Bank
claims exemption from, or a reduction of, U.S. withholding
tax under Sections 1441 or 1442 of the Code, such Bank
agrees to deliver to the Agent:
(i) if such Bank claims an exemption from, or a
reduction of, withholding tax under a United States tax
treaty, properly completed Internal Revenue Service
("IRS") Forms 1001 and W-8 before the payment of any
interest in the first calendar year and before the
payment of any interest in each third succeeding
calendar year during which interest may be paid under
this Agreement;
(ii) if such Bank claims that interest paid
under this Agreement is exempt from United States
withholding tax because it is effectively
connected with a United States trade or business
of such Bank, two properly completed and executed
copies of IRS Form 4224 before the payment of any
interest is due in the first taxable year of such
Bank and in each succeeding taxable year of such
Bank during which interest may be paid under this
Agreement, and IRS Form W-9; and
(iii) such other form or forms as may be
required under the Code or other laws of the
United States as a condition to exemption from, or
reduction of, United States withholding tax.
Such Bank agrees to promptly notify the Agent of any
change in circumstances which would modify or render
invalid any claimed exemption or reduction.
(b) If any Bank claims exemption from, or
reduction of, withholding tax under a United States tax
treaty by providing IRS Form 1001 and such Bank sells,
assigns, grants a participation in, or otherwise
transfers all or part of the obligations of the Company
to such Bank, such Bank agrees to notify the Agent of
the percentage amount in which it is no longer the
beneficial owner of such obligations of the Company
hereunder. To the extent of such percentage amount,
the Agent will treat such Bank's IRS Form 1001 as no
longer valid.
(c) If any Bank claiming exemption from United
States withholding tax by filing IRS Form 4224 with the
Agent sells, assigns, grants a participation in, or
otherwise transfers all or part of the obligations of
the Company to such Bank hereunder, such Bank agrees to
undertake sole responsibility for complying with the
withholding tax requirements imposed by Sections 1441
and 1442 of the Code.
(d) If any Bank is entitled to a reduction in the
applicable withholding tax, the Agent may withhold from
any interest payment to such Bank an amount equivalent
to the applicable withholding tax after taking into
account such reduction. If the forms or other
documentation required by subsection (a) of this
Section are not delivered to the Agent, then the Agent
may withhold from any interest payment to such Bank not
providing such forms or other documentation an amount
equivalent to the applicable withholding tax.
(e) If the IRS or any other governmental
authority of the United States or any other
jurisdiction asserts a claim that the Agent did not
properly withhold tax from amounts paid to or for the
account of any Bank (because the appropriate form was
not delivered or was not properly executed, or because
such Bank failed to notify the Agent of a change in
circumstances which rendered the exemption from, or
reduction of, withholding tax ineffective, or for any
other reason) such Bank shall indemnify the Agent fully
for all amounts paid, directly or indirectly, by the
Agent as tax or otherwise, including penalties and
interest, and including any taxes imposed by any
jurisdiction on the amounts payable to the Agent under
this Section, together with all costs and expenses
(including reasonable fees of attorneys for the Agent
(including the allocable costs of internal legal
services and all disbursements of internal counsel)).
The obligation of the Banks under this subsection shall
survive the repayment of the Loans, cancellation of the
Notes, any termination of this Agreement and the
resignation or replacement of the Agent.
13.11 Co-Agent. The co-agent shall have no duties or
responsibilities hereunder in such capacity.
SECTION 14 GENERAL.
14.1 Waiver; Amendments. No delay on the part of the
Agent, any Bank or any other holder of a Note in the exercise of
any right, power or remedy shall operate as a waiver thereof, nor
shall any single or partial exercise by any of them of any right,
power or remedy preclude other or further exercise thereof, or
the exercise of any other right, power or remedy. No amendment,
modification or waiver of, or consent with respect to, any
provision of this Agreement or the Notes shall in any event be
effective unless the same shall be in writing and signed and
delivered by Banks having an aggregate Percentage of not less
than the aggregate Percentage expressly designated herein with
respect thereto or, in the absence of such designation as to any
provision of this Agreement or the Notes, by the Required Banks,
and then any such amendment, modification, waiver or consent
shall be effective only in the specific instance and for the
specific purpose for which given. No amendment, modification,
waiver or consent shall change the Percentage of any Bank without
the consent of such Bank. No amendment, modification, waiver or
consent shall (i) extend or increase the amount of the
Commitments, (ii) extend the date for payment of any principal of
or interest on the Loans or any fees payable hereunder, (iii)
reduce the principal amount of any Loan, the rate of interest
thereon or any fees payable hereunder, (iv) release (x) the
Intercompany Guaranty or (y) the pledge of the stock of one or
more Subsidiaries of the Company if (1) after giving effect to
such release, there will not continue to be pledged to the Agent
pursuant to the Company Pledge Agreement the stock of one or more
Subsidiaries of the Company which own at least 25% of the net
value of the consolidated assets of the Company and its
Subsidiaries as of the last day of the preceding Fiscal Year as
reflected in the financial reports required to be delivered
pursuant to Section 10.1.1 or (2) the pledge of such stock
securing the obligations of the Company under the Senior Notes is
not also concurrently released or (v) reduce the aggregate
Percentage required to effect an amendment, modification, waiver
or consent without, in each case, the consent of all Banks. No
provisions of Section 13 or other provision of this Agreement
affecting the Agent in its capacity as such shall be amended,
modified or waived without the consent of the Agent.
14.2 Confirmations. The Company and each holder of a Note
agree from time to time, upon written request received by it from
the other, to confirm to the other in writing (with a copy of
each such confirmation to the Agent) the aggregate unpaid
principal amount of the Loans then outstanding under such Note.
14.3 Notices. Except as otherwise provided in Section 2.2,
all notices hereunder shall be in writing (including facsimile
transmission) and shall be sent to the applicable party at its
address shown below its signature hereto or at such other address
as such party may, by written notice received by the other party,
have designated as its address for such purpose. Notices sent by
facsimile transmission shall be deemed to have been given when
sent; notices sent by mail shall be deemed to have been given
three Business Days after the date when sent by registered or
certified mail, postage prepaid; and notices sent by hand
delivery or overnight courier service shall be deemed to have
been given when received. For purposes of Section 2.2, the Agent
shall be entitled to rely on telephonic instructions from any
person that the Agent in good faith believes is an authorized
officer or employee of the Company, and the Company shall hold
the Agent and each Bank harmless from any loss, cost or expense
resulting from any such reliance.
14.4 Computations. Where the character or amount of any
asset or liability or item of income or expense is required to be
determined, or any consolidation or other accounting computation
is required to be made, for the purpose of this Agreement, such
determination or calculation shall, to the extent applicable and
except as otherwise specified in this Agreement, be made in
accordance with generally accepted accounting principles applied
on a basis consistent with those used in the preparation of the
Company's audited financial statements at December 31, 1993.
14.5 Regulation U. Each Bank represents that it in good
faith is not relying, either directly or indirectly, upon any
Margin Stock as collateral security for the extension or
maintenance by it of any credit provided for in this Agreement.
14.6 Costs, Expenses and Taxes. The Company agrees to pay
on demand all reasonable out-of-pocket costs and expenses of the
Agent (including the fees and charges of counsel for the Agent
and of local counsel, if any, who may be retained by said
counsel) in connection with the preparation, execution, delivery
and administration of this Agreement, the other Loan Documents
and all other documents provided for herein or delivered or to be
delivered hereunder or in connection herewith (including any
amendments, supplements or waivers to any Loan Documents), and
all reasonable out-of-pocket costs and expenses (including
reasonable attorneys' fees, court costs and other legal expenses
and allocated costs of staff counsel) incurred by the Agent and
each Bank after an Event of Default in connection with the
enforcement of this Agreement, the other Loan Documents or any
such other documents. Each Bank agrees to reimburse the Agent
for such Bank's pro rata share (based on its respective
Percentage) of any such costs and expenses of the Agent not paid
by the Company. In addition, the Company agrees to pay, and to
save the Agent and the Banks harmless from all liability for, (a)
any stamp or other taxes which may be payable in connection with
the execution and delivery of this Agreement, the borrowings
hereunder, the issuance of the Notes or the execution and
delivery of any other Loan Document or any other document
provided for herein or delivered or to be delivered hereunder or
in connection herewith and (b) any fees of the Company's auditors
in connection with any reasonable exercise by the Agent and the
Banks of their rights pursuant to Section 10.2. All obligations
provided for in this Section 14.6 shall survive repayment of the
Loans, cancellation of the Notes and any termination of this
Agreement.
14.7 Subsidiary References. The provisions of this
Agreement relating to Subsidiaries shall apply only during such
times as the Company has one or more Subsidiaries.
14.8 Captions. Section captions used in this Agreement are
for convenience only and shall not affect the construction of
this Agreement.
14.9 Assignments; Participation.
14.9.1 Assignments. Any Bank may, with the prior written
consents of the Company and the Agent (which consents shall not
be unreasonably delayed or withheld), at any time assign and
delegate to one or more commercial banks or other Persons (any
Person to whom such an assignment and delegation is to be made
being herein called an "Assignee"), all or any fraction of such
Bank's Loans and Commitments (which assignment and delegation
shall be of a constant, and not a varying, percentage of all the
assigning Bank's Loans and Commitments) in a minimum aggregate
amount equal to the lesser of (i) the assigning Bank's remaining
aggregate Commitments and (ii) $5,000,000; provided, however,
that (a) no assignment and delegation may be made to any Person
if, at the time of such assignment and delegation, the Company
would be obligated to pay any greater amount under Section 7.6 or
Section 8 to the Assignee than the Company is then obligated to
pay to the assigning Bank under such Sections (and if any
assignment is made in violation of the foregoing, the Company
will not be required to pay the incremental amounts) and (b) the
Company and the Agent shall be entitled to continue to deal
solely and directly with such Bank in connection with the
interests so assigned and delegated to an Assignee until the date
when all of the following conditions shall have been met:
(x) five Business Days (or such lesser period of time
as the Agent and the assigning Bank shall agree) shall have
passed after written notice of such assignment and
delegation, together with payment instructions, addresses
and related information with respect to such Assignee, shall
have been given to the Company and the Agent by such
assigning Bank and the Assignee,
(y) the assigning Bank and the Assignee shall have
executed and delivered to the Company and the Agent an
assignment agreement substantially in the form of Exhibit E
(an "Assignment Agreement"), together with any documents
required to be delivered thereunder, which Assignment
Agreement shall have been accepted by the Agent, and
(z) the assigning Bank or the Assignee shall have paid
the Agent a processing fee of $2,500.
From and after the date on which the conditions described above
have been met, (x) such Assignee shall be deemed automatically to
have become a party hereto and, to the extent that rights and
obligations hereunder have been assigned and delegated to such
Assignee pursuant to such Assignment Agreement, shall have the
rights and obligations of a Bank hereunder, and (y) the assigning
Bank, to the extent that rights and obligations hereunder have
been assigned and delegated by it pursuant to such Assignment
Agreement, shall be released from its obligations hereunder.
Within five Business Days after effectiveness of any assignment
and delegation, the Company shall execute and deliver to the
Agent (for delivery to the Assignee and the Assignor, as
applicable) a new Note in the principal amount of the Assignee's
Loan Commitment and, if the assigning Bank has retained a Loan
Commitment hereunder, a replacement Note in the principal amount
of the Loan Commitment retained by the assigning Bank (such Note
to be in exchange for, but not in payment of, the predecessor
Note held by such assigning Bank). Each such Note shall be dated
the effective date of such assignment. The assigning Bank shall
mark the predecessor Note "exchanged" and deliver it to the
Company. Accrued interest on that part of the predecessor Note
being assigned shall be paid as provided in the Assignment
Agreement. Accrued interest and fees on that part of the
predecessor Note not being assigned shall be paid to the
assigning Bank. Accrued interest and accrued fees shall be paid
at the same time or times provided in the predecessor Note and in
this Agreement. Any attempted assignment and delegation not made
in accordance with this Section 14.9.1 shall be null and void.
Notwithstanding the foregoing provisions of this Section
14.9.1 or any other provision of this Agreement, any Bank may at
any time assign all or any portion of its Loans and its Note to a
Federal Reserve Bank (but no such assignment shall release any
Bank from any of its obligations hereunder).
14.9.2 Participation. Any Bank may at any time sell to one
or more commercial banks or other Persons participating interests
in any Loan owing to such Bank, the Note held by such Bank, the
Commitments of such Bank, the direct or participation interest of
such Bank in any Letter of Credit or any other interest of such
Bank hereunder (any Person purchasing any such participating
interest being herein called a "Participant"). In the event of a
sale by a Bank of a participating interest to a Participant, (x)
such Bank shall remain the holder of its Note for all purposes of
this Agreement, (y) the Company and the Agent shall continue to
deal solely and directly with such Bank in connection with such
Bank's rights and obligations hereunder and (z) all amounts
payable by the Company shall be determined as if such Bank had
not sold such participation and shall be paid directly to such
Bank. No Participant shall have any direct or indirect voting
rights hereunder except with respect to any release of the
Intercompany Guaranty or any of the events (excluding the events
described in clause (v) thereof) described in the penultimate
sentence of Section 14.1. Each Bank agrees to incorporate the
requirements of the preceding sentence into each participation
agreement which such Bank enters into with any Participant. The
Company agrees that if amounts outstanding under this Agreement
and the Notes are due and payable (as a result of acceleration or
otherwise), each Participant shall be deemed to have the right of
setoff in respect of its participating interest in amounts owing
under this Agreement, any Note and with respect to any Letter of
Credit to the same extent as if the amount of its participating
interest were owing directly to it as a Bank under this Agreement
or such Note; provided that such right of setoff shall be subject
to the obligation of each Participant to share with the Banks,
and the Banks agree to share with each Participant, as provided
in Section 7.5. The Company also agrees that each Participant
shall be entitled to the benefits of Section 7.6 and Section 8 as
if it were a Bank (provided that no Participant shall receive any
greater compensation pursuant to Section 7.6 or Section 8 than
would have been paid to the participating Bank if no
participation had been sold).
14.10 Governing Law. This Agreement and each Note shall be
a contract made under and governed by the internal laws of the
State of Illinois. Whenever possible each provision of this
Agreement shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of this
Agreement shall be prohibited by or invalid under applicable law,
such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Agreement.
All obligations of the Company and rights of the Agent, the Banks
and any other holder of a Note expressed herein or in any other
Loan Document shall be in addition to and not in limitation of
those provided by applicable law.
14.11 Counterparts. This Agreement may be executed in any
number of counterparts and by the different parties hereto on
separate counterparts and each such counterpart shall be deemed
to be an original, but all such counterparts shall together
constitute but one and the same Agreement. When counterparts
executed by all of the parties hereto shall have been lodged with
the Agent (or, in the case of any Bank as to which an executed
counterpart shall not have been so lodged, the Agent shall have
received confirmation from such Bank of execution of a
counterpart hereof by such Bank), this Agreement shall become
effective as of the date hereof, and at such time the Agent shall
notify the Company and each Bank.
14.12 Successors and Assigns. This Agreement shall
be binding upon the Company, the Banks and the Agent and their
respective successors and assigns, and shall inure to the benefit
of the Company, the Banks and the Agent and the successors and
assigns of the Banks and the Agent.
14.13 Indemnification by the Company.
(a) In consideration of the execution and delivery of this
Agreement by the Agent and the Banks and the agreement to extend
the Commitments provided hereunder, the Company hereby agrees to
indemnify, exonerate and hold the Agent, each Bank and each of
the officers, directors, employees, Affiliates and agents of the
Agent and each Bank (each, a "Bank Party") free and harmless from
and against any and all actions, causes of action, suits, losses,
liabilities, damages and expenses, including reasonable
attorneys' fees and charges and allocated costs of staff counsel
(collectively, for purposes of this Section 14.13, called the
"Indemnified Liabilities"), incurred by the Bank Parties or any
of them as a result of, or arising out of, or relating to (i) any
tender offer, merger, purchase of stock, purchase of assets or
other similar transaction financed or proposed to be financed in
whole or in part, directly or indirectly, with the proceeds of
any of the Loans or (ii) the execution, delivery, performance or
enforcement of this Agreement or any other Loan Document by any
of the Bank Parties, except for any such Indemnified Liabilities
arising on account of any such Bank Party's gross negligence or
willful misconduct. If and to the extent that the foregoing
undertaking may be unenforceable for any reason, the Company
hereby agrees to make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law. Nothing set forth above shall
be construed to relieve any Bank Party from any obligation it may
have under this Agreement.
(b) The Company agrees to reimburse the Agent and each Bank
and their respective directors, officers, employees, Affiliates
and agents (each an "Indemnified Party") against any and all
losses, claims, damages, penalties, judgments, liabilities and
expenses (including reasonable attorneys' and consultant's fees
and allocated costs of staff counsel) which any Indemnified Party
may pay, incur or become subject to arising out of or relating to
(i) the use, handling, Release, emission, discharge,
transportation, storage, treatment or Disposal of any Hazardous
Substance at any Real Property, (ii) any violation of any
Environmental Laws with respect to conditions at any Real
Property or other assets of the Company or any Subsidiary or the
operations conducted thereon or (iii) the investigation, cleanup
or remediation of offsite locations at which the Company or any
Subsidiary or its respective predecessors are alleged to have
directly or indirectly disposed of Hazardous Substances, in each
case except to the extent caused by the acts or omissions of the
party seeking indemnity.
(c) All obligations provided for in this Section 14.13
shall survive repayment of the Loans, cancellation of the Notes,
any foreclosure under, or any modification, release or discharge
of the Intercompany Guaranty or the Company Pledge Agreement and
any termination of this Agreement.
14.14 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, SHALL
BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE COURTS OF THE STATE
OF ILLINOIS OR IN THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF ILLINOIS; PROVIDED, HOWEVER, THAT ANY SUIT
SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY
BE BROUGHT, AT THE AGENT'S OPTION, IN THE COURTS OF ANY
JURISDICTION WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE
FOUND. THE COMPANY HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO
THE JURISDICTION OF THE COURTS OF THE STATE OF ILLINOIS AND OF
THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF
ILLINOIS FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH
ABOVE. THE COMPANY FURTHER IRREVOCABLY CONSENTS TO THE SERVICE
OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL
SERVICE WITHIN OR WITHOUT THE STATE OF ILLINOIS. THE COMPANY
HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
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 COMPANY 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 COMPANY HEREBY IRREVOCABLY WAIVES
SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS.
14.15 Waiver of Jury Trial. EACH OF THE COMPANY, THE AGENT
AND EACH BANK HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS
AGREEMENT, ANY NOTE, ANY OTHER LOAN DOCUMENT AND ANY AMENDMENT,
INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE
FUTURE BE DELIVERED IN CONNECTION HEREWITH OR THEREWITH OR
ARISING FROM ANY BANKING RELATIONSHIP EXISTING IN CONNECTION WITH
ANY OF THE FOREGOING, AND AGREES THAT ANY SUCH ACTION OR
PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
<PAGE>
Delivered at Chicago, Illinois, as of the day and year first
above written.
UNITED WASTE SYSTEMS, INC.
By
Chief Financial Officer
Four Greenwich Office Park
Greenwich, Connecticut 06830
Attention: Chief Financial Officer
Facsimile: (203) 622-6080
BANK OF AMERICA ILLINOIS, as Agent
By
Title
231 South LaSalle Street
Chicago, Illinois 60697
Attention: Agency Management Services
Facsimile: (312) 828-7299
BANK OF AMERICA ILLINOIS, as Letter of
Credit Issuer
By
Title
231 South LaSalle Street
Chicago, Illinois 60697
Attention: Service Industries Group
Facsimile: (312) 828-1974
BANK OF AMERICA ILLINOIS, as a Bank
By
Title
231 South LaSalle Street
Chicago, Illinois 60697
Attention: Service Industries Group
Facsimile: (312) 828-1974
THE FIRST NATIONAL BANK OF BOSTON,
individually and as Co-Agent
By
Title
100 Federal Street
Boston, Massachusetts 02110
Attention: Arthur J. Oberheim
Facsimile (617) 434-2160
FLEET BANK N.A.
By
Title
1133 Avenue of the Americas - 40th Floor
New York, New York 10038
Attention: Cameron Gateman
Facsimile: (212) 703-1658
COMERICA BANK
By
Title
One Detroit Center
500 Woodward Avenue
Detroit, Michigan 48226
Attention: Mark Koszyk
Facsimile: (313) 222-5759<PAGE>
HARRIS TRUST AND SAVINGS BANK
By
Title
111 West Monroe Street
Chicago, Illinois 60603
Attention: Bill McDonnell
Facsimile: (312) 461-2591
UNION BANK OF CALIFORNIA
By
Title
445 S. Figueroa St., 15th Floor
Los Angeles, California 90071
Attention: Julie Bloomfield
Facsimile: (213) 236-4096
ANNEX I
Portion of
Bank Commitment Amount Percentage
Bank of America Illinois $55,000,000 28,94736842%
The First National Bank $35,000,000 18.42105263%
of Boston
Comerica Bank $25,000,000 13.15789474%
Fleet Bank $25,000,000 13.15789474%
Harris Trust and Savings Bank $25,000,000 13.15789474%
Union Bank $25,000,000 13.15789474%
$190,000,000 100%
TOTALS
SCHEDULE I
PRICING SCHEDULE
The Floating Rate Margin, the Eurodollar Margin, the rate per
annum applicable for non-use fees and the rate per annum applicable
for letter of credit fees for Financial Letters of Credit and
Non-Financial Letters of Credit, respectively, shall be determined in
accordance with the table below and the other provisions of this
Schedule II.
Level I
Level II
Level III
Level IV
Rate for
Non-Use Fee
0.375%
0.30%
0.25%
.20%
Eurodollar Margin
1.25%
1.00%
0.75%
0.625%
Floating Rate Margin
0
0
0
0
Rate for
Non-Financial LC Fee
0.625%
.50%
0.375%
0.3125%
Rate for
Financial LC Fee
1.25%
1.00%
0.75%
0.625%
Level I applies when the Senior Funded Debt to Cash Flow
Ratio is equal to or greater than 2.5 to 1.
Level II applies when the Senior Funded Debt to Cash Flow
Ratio is equal to or greater than 1.75 to 1 but less than 2.50 to
1.
Level III applies when the Senior Funded Debt to Cash Flow
Ratio is equal to or greater than 1.25 to 1 but less than 1.75 to
1.
Level IV applies when the Senior Funded Debt to Cash Flow
Ratio is less than 1.25 to 1.
The applicable Level shall be adjusted, to the extent
applicable, 45 days (or, in the case of the last Fiscal Quarter
of any Fiscal Year, 90 days) after the end of each Fiscal Quarter
based on the Senior Funded Debt to Cash Flow Ratio as of the last
day of such Fiscal Quarter; provided that if the Company fails to
deliver the financial statements required by Section 10.1.1 or
10.1.2, as applicable, and the related certificate required by
Section 10.1.3 by the 45th day (or, if applicable, the 90th day)
after any Fiscal Quarter, Level I shall apply until such
financial statements are delivered.
SCHEDULE II
DETAILS SCHEDULE
ITEM 9.6(a) Litigation and Contingent Liabilities.
See following pages.
ITEM 9.6(b) Royalties and Other Contingent Payments.
See following pages.
ITEM 9.8 Subsidiaries.
See following page.
ITEM 9.15.1 Environmental Violations.
ITEM 9.15.2 Notices of Environmental Matters.
ITEM 9.15.3 Hazardous Materials.
ITEM 9.15.4 Clean-Ups.
See following pages as to the foregoing four items.
ITEM 10.7 Existing Debt.
See following pages.
SCHEDULE 10.22
Approved Operating Leases
The lease for the use of the Chicopee Landfill in Chicopee,
Massachusetts.
EXHIBIT A
FORM OF
NOTE
$__________ December __, 1996
Chicago, Illinois
On the Termination Date (as defined in the Credit Agreement
referred to below), the undersigned, for value received, promises
to pay to the order of __________________ at the principal office
of Bank of America Illinois (the "Agent"), in Chicago, Illinois,
______________________________________ Dollars ($__________) or,
if less, the aggregate unpaid amount of all Loans made by the
payee to the undersigned pursuant to the Credit Agreement (as
shown in the records of the payee or, at the payee's option, on
the schedule attached hereto and any continuation thereof).
The undersigned further promises to pay interest on the
unpaid principal amount of each Loan evidenced hereby from the
date of such Loan until such Loan is paid in full, payable at the
rate(s) and at the time(s) set forth in the Credit Agreement.
Payments of both principal and interest are to be made in lawful
money of the United States of America.
This Note evidences indebtedness incurred under, and is
subject to the terms and provisions of, the Fourth Amended and
Restated Credit Agreement, dated as of December 5, 1996, (herein,
as amended or otherwise modified from time to time, called the
"Credit Agreement"), between the undersigned, certain financial
institutions (including the payee), The First National Bank of
Boston, as co-agent, and the Agent, to which Credit Agreement
reference is hereby made for a statement of the terms and
provisions under which this Note may or must be paid prior to its
due date or may have its due date accelerated.
In addition to and not in limitation of the foregoing and
the provisions of the Credit Agreement, the undersigned further
agrees, subject only to any limitation imposed by applicable law,
to pay all reasonable expenses, including reasonable attorneys'
fees and legal expenses, incurred by the holder of this Note in
endeavoring to collect any amounts payable hereunder which are
not paid when due, whether by acceleration or otherwise.
This Note is made under and governed by the internal laws of
the State of Illinois.
UNITED WASTE SYSTEMS, INC.
By
Title
Schedule Attached to Note dated December __, 1996 of UNITED WASTE
SYSTEMS, INC. payable to the order of _________________________.
Date and Unpaid
Amount of Date and Amount Principal Notation
Loan of Repayment Balance Made by
EXHIBIT B
UNITED WASTE SYSTEMS, INC.
FINANCIAL COMPLIANCE CERTIFICATE
FOR PERIOD ENDED _____________
To: Bank of America Illinois as Agent
Reference is made to Section 10.1.3 of the Fourth Amended and
Restated Credit Agreement, dated as of December 5, 1996, (as
amended or otherwise modified from time to time, the "Credit
Agreement"), among United Waste Systems, Inc. (the "Company"),
the financial institutions named therein, The First National Bank
of Boston, as co-agent, and Bank of America Illinois, as Agent.
Capitalized terms used but not otherwise defined herein are used
as defined in the Credit Agreement.
The Company hereby certifies and warrants to you that the
following are true and correct computations of the financial
ratios and restrictions set forth in Section 10.6 and Schedule I
of the Credit Agreement:
10.6.1 Minimum Net Worth
Net Worth
$____________
Initial minimum:
Plus: 50% of Consolidated
Net Income since
10/01/96 (excluding
Fiscal Quarters in
which there is a loss)
100% of net equity
proceeds since 9/30/96
$250,000,000
$___________
$___________
Total
$___________
Minimum required
$___________
10.6.2 Maximum Leverage
Funded Debt
__________(a)
Funded Debt
plus Net Worth
__________(b)
ratio of (a) to (b)
____ to ____
Maximum allowed
0.58 to 1.0
10.6.3 Minimum Interest
Coverage
Consolidated Net Income
Plus: Interest Expense
taxes
$___________
$___________
$___________
Earnings before interest and
taxes
$_________(a)
Interest Expense
__________(b)
Ratio of (a) to (b)
____ to ____
Minimum Required
2.5 to 1.0
10.6.4 Funded Debt to Cash
Flow Ratio
Funded Debt
$_________(a)
Consolidated Net Income
Plus: Interest Expense
Income tax expense
Depreciation and
amortization
$___________
$___________
$___________
$___________
Total
$_________(b)
Ratio of (a) to (b)
Maximum Allowed
____ to ____
3.75 to 1
Schedule I Senior Funded Debt
to Cash Flow Ratio
Senior Funded Debt
$_________(a)
Consolidated Net Income
Plus: Interest Expense
Income tax expense
Depreciation and
amortization
$___________
$___________
$___________
$___________
Total
$_________(b)
Ratio of (a) to (b)
____ to ____
IN WITNESS WHEREOF, the Company has caused this Certificate to be
executed and delivered by its duly authorized officer this ____
day of _________, 19__.
UNITED WASTE SYSTEMS, INC.
By_________________________
Title______________________
EXHIBIT E
SUBORDINATION PROVISIONS APPLICABLE TO
SUBORDINATED DEBT
15 The indebtedness evidenced by the subordinated notes
shall at all times be wholly subordinate and junior in right or
payment to any and all Superior Indebtedness (as defined below)
in the manner and with the force and effect hereafter set forth:
15.1 In the event of any liquidation, dissolution or
winding up of the Company, or of any execution sale,
receivership, insolvency, bankruptcy, reorganization or
other similar proceeding relative to the Company or its
property, all principal and interest owing on all Superior
Indebtedness shall first be paid in full before any payment
is made upon the indebtedness evidenced by the subordinated
notes; and in any such event any payment or distribution of
any kind or character, whether in cash, property or
securities (other than in securities or other evidences of
indebtedness, the payment of which is subordinated to the
payment of all Superior Indebtedness which may at the time
be outstanding) which shall be made upon or in respect of
the subordinated notes shall be paid over to the holders of
such Superior Indebtedness, pro rata, for application in
payment thereof until such Superior Indebtedness shall have
been paid or satisfied in full;
15.2 (a) During the continuance of any default in any
agreement pursuant to which any Superior Indebtedness is
issued which arises from the failure to pay when due
(whether by acceleration or otherwise) any principal of,
premium, if any, interest on, fees or other amounts in
respect of such Superior Indebtedness (a "Superior Payment
Default"), no payment of principal, premium or interest
shall be made on the subordinated notes if either (i) notice
in writing of such default has been given to the Company by
any holder or holders of any Superior Indebtedness or (ii)
judicial proceedings shall be pending in respect of such
default; and
(b) During the continuance of any event of default or
unmatured event of default in any agreement pursuant to
which any Superior Indebtedness is issued other than a
Superior Payment Default (a "Superior Non-Payment Default")
as to which the Company has received notice in writing from
any holder or holders of Superior Indebtedness, no payment
of principal, premium or interest shall be made on the
subordinated notes for a period (each, a "Payment Blockage
Period") commencing on the date of receipt by the Company of
such notice and terminating on the earliest to occur of the
following dates: (i) the date of acceleration of the
Superior Indebtedness, (ii) 180 days after the Company's
receipt of such written notice, (iii) the date such Superior
Non-Payment Default shall have been cured or waived, or
shall have ceased to exist, (iv) the date the Superior
Indebtedness shall have been discharged or paid in full in
cash, or (v) the date such Payment Blockage Period shall
have been terminated by written notice to the Company from
the holder or holders of Superior Indebtedness initiating
such Payment Blockage Period, after which, in the case of
clauses (ii), (iii), (iv) and (v), the Company shall resume
making payments in respect of the subordinated notes, unless
clause 2(a) above is then applicable; and
15.3 If the subordinated notes are declared or become
due and payable because of the occurrence of any default
thereunder or under the agreement or instrument under which
they are issued or otherwise than at the option of the
Company, under circumstances when clause (1) shall not be
applicable, the holders of the subordinated notes shall not
be entitled to payments until one hundred twenty (120) days
after such event and then only if such payment is permitted
under clauses (1) and (2).
16 The holder of each subordinated note undertakes and
agrees for the benefit of each holder of Superior Indebtedness to
execute, verify, deliver and file any proof of claim, consent,
assignment or other instrument which any holder of Superior
Indebtedness may at any time require in order to prove and
realize upon any right or claim pertaining to the subordinated
notes and to effectuate the full benefit of the subordination
contained herein; and upon failure of the holder of any
subordinated note so to do any such holder of Superior
Indebtedness shall be deemed to be irrevocably appointed the
agent and attorney-in-fact of the holder of such note to execute,
verify, deliver and file any such proof of claim, consent,
assignment or other instrument.
17 No right of any holder of any Superior Indebtedness to
enforce subordination as herein provided shall at any time or in
any way be affected or impaired by any failure to act on the part
of the Company or any holder of Superior Indebtedness, or by any
non-compliance by the Company with any term, provision or
covenant of the subordinated notes or the agreement under which
they are issued, regardless of any knowledge thereof that any
such holder of Superior Indebtedness may have or be otherwise
charged with.
18 The Company agrees, for the benefit of the holders of
Superior Indebtedness, that in the event that any subordinated
note is declared due and payable before its expressed maturity
because of the occurrence of a default thereunder or under the
agreement under which they are issued, (a) the Company will give
prompt notice in writing of such happening to the holders of
Superior Indebtedness and (b) all Superior Indebtedness shall
forthwith become immediately due and payable upon demand,
regardless of the expressed maturity thereof.
19 "Superior Indebtedness" means (a) all obligations of the
Company under or in connection with any loan agreement, revolving
credit agreement, reimbursement agreement relating to any letter
of credit or similar agreement (in each case as amended, restated
or otherwise modified from time to time) with any bank or other
financial institution (individually or as a group), whether for
principal, interest (including any interest that would accrue but
for the filing of a petition initiating any bankruptcy,
insolvency or like proceeding, whether or not such interest is an
allowed claim enforceable against the debtor), fees, expenses or
otherwise, (b) all obligations of the Company under or in
connection with any interest rate swap agreement or similar
hedging arrangement (as amended or otherwise modified from time
to time) and (c) all other obligations of the Company in respect
of indebtedness for borrowed money if the instrument creating or
evidencing such indebtedness expressly provides that such
indebtedness constitutes "Superior Indebtedness" of the Company.
Notwithstanding the foregoing, Superior Indebtedness shall not
include (i) accounts payable or other obligations to trade
creditors arising in the ordinary course of business, (ii) any
obligation of the Company which is expressly subordinated to any
other obligation of the Company, (iii) any liability for federal,
state, local or other taxes, (iv) obligations to any subsidiary
or affiliate of the Company or (v) deferred pension liabilities.
EXHIBIT F
FORM OF
ASSIGNMENT AGREEMENT
Reference is made to Section 14.9.1 of the Fourth Amended
and Restated Credit Agreement dated as of December 5, 1996 (as
amended or otherwise modified, the "Credit Agreement"), among
United Waste Systems, Inc., various financial institutions, The
First National Bank of Boston, as co-agent, and Bank of America
Illinois, as agent (the "Agent"). Unless otherwise defined
herein or the context otherwise requires, terms used herein have
the meanings provided in the Credit Agreement.
_____________________________________ (the "Assignor") and
__________________________________________ (the "Assignee")
hereby agree as follows:
The Assignor hereby sells and assigns to the Assignee, and
the Assignee hereby purchases and assumes from the Assignor, that
interest in and to the Assignor's rights and obligations under
the Credit Agreement as of the date hereof equal to _____% of all
of the Loans, the Letters of Credit and the Commitments, such
purchase and assignment to be effective as of the effective date
set forth herein. After giving effect to such assignment and
delegation, the Assignor's and Assignee's Percentages and
portions of Commitment Amount for the purposes of the Credit
Agreement will be as set forth opposite each such Person's name
on the signature pages hereof.
The effective date of this Agreement shall be the date when
the consent of the Agent and the Company to this Agreement has
been received and the conditions set forth in clauses (x), (y)
and (z) of the proviso to the first paragraph of Section 14.9.1
of the Credit Agreement shall be either met or waived. The
Assignor hereby instructs the Agent to make all payments after
the effective date hereof in respect of the interest assigned
hereby directly to the Assignee. The Assignor and the Assignee
agree that all interest and fees accrued up to, but not
including, the effective date of the assignment and delegation
being made hereby are the property of the Assignor, and not the
Assignee. The Assignee agrees that, upon receipt of any such
interest or fees, the Assignee will promptly remit the same to
the Assignor.
The Assignee hereby confirms that it has received a copy of
the Credit Agreement and the exhibits related thereto, together
with copies of the documents which were required to be delivered
under the Credit Agreement as a condition to the making of the
Loans thereunder. The Assignee acknowledges and agrees that it
(i) has made and will continue to make such inquiries and has
taken and will take such care on its own behalf as would have
been the case had its Commitments been granted, the Letters of
Credit been issued and its Loans been made directly by such
Assignee to or for the benefit of the Company without the
intervention of the Agent, the Assignor or any other Bank and
(ii) has made and will continue to make, independently and
without reliance upon the Agent, the Assignor or any other Bank
and based on such documents and information as it deems
appropriate, its own credit analysis and decisions relating to
the Credit Agreement. The Assignee further acknowledges and
agrees that the Agent makes no representations or warranties
about the creditworthiness of the Company or any other party to
the Credit Agreement or any other Loan Document or with respect
to the legality, validity, sufficiency or enforceability of the
Credit Agreement or any other Loan Document or the value of any
security therefor.
The Assignor represents and warrants that it is the legal
and beneficial owner of the interest being assigned by it
hereunder and that such interest is free and clear of any adverse
claim.
The Assignee represents and warrants to the Agent and the
Company that, as of the date hereof, the Company will not be
obligated to pay any greater amount under Section 7.6 or Section
8 of the Credit Agreement than the Company is obligated to pay to
the Assignor under such Sections.
Except as otherwise provided in the Credit Agreement,
effective as of the date of acceptance hereof by the Agent:
(a) the Assignee (i) shall be deemed automatically to have
become a party to the Credit Agreement and have all the
rights and obligations of a "Bank" under the Credit
Agreement as if it were an original signatory thereto
to the extent specified in the second paragraph hereof;
and (ii) agrees to be bound by the terms and conditions
set forth in the Credit Agreement as if it were an
original signatory thereto; and
(b) the Assignor shall be released from its obligations
under the Credit Agreement to the extent specified in
the second paragraph hereof.
The Assignor and the Assignee hereby agree that the
[Assignor/Assignee] will pay the Agent the processing fee
referred to in Section 14.9.1 of the Credit Agreement.
The Assignee hereby advises each of you of the following
administrative details with respect to the assigned Loans and
Commitments:
(A) Address for Notices:
Institution Name: _________________________________
Address: __________________________________________
Attention: ___________________
Telephone: ___________________
Facsimile: _______________
(B) Payment Instructions:
_____________________________
_____________________________
_____________________________
_____________________________
_____________________________
_____________________________
_____________________________
[The Assignee has delivered to the Company and the Agent, or
is delivering to the Company and the Agent concurrently herewith,
the tax forms referred to in Section 7.6 of the Credit
Agreement.] [INSERT THIS PARAGRAPH IF ASSIGNEE IS ORGANIZED
UNDER THE LAW OF A JURISDICTION OUTSIDE THE UNITED STATES.]
IN WITNESS WHEREOF, the undersigned have caused this
Agreement to be executed this _____day of ___________, 199__.
Percentage = ______% [NAME OF ASSIGNEE]
Amount of
Commitment = $ _________
By:
Title:
Adjusted Percentage = ______% [NAME OF ASSIGNOR]
Amount of
Commitment = $ _________
By:
Title:
ACCEPTED AND CONSENTED TO
this ____ day of _______, 199_
BANK OF AMERICA ILLINOIS,
as Agent
By:
Title:
CONSENTED TO
this ____ day of _______, 199_
UNITED WASTE SYSTEMS, INC.
By:
Title:
