SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
________________
SCHEDULE 14D-1
TENDER OFFER STATEMENT
Pursuant to Section 14(d)(1) of the
Securities Exchange Act of 1934
(Amendment No. 2)
AND
SCHEDULE 13D
Pursuant to Section 13(d)(1) of the
Securities Exchange Act of 1934
CONTROL DATA SYSTEMS, INC.
(Name of Subject Company)
CDSI HOLDING CORPORATION
CDSI ACQUISITION CORP.
(Bidder)
Common Stock, $.01 par value
(Title of Class of Securities)
21238F 10 6
(CUSIP Number of Class of Securities)
Patrick J. Welsh
CDSI Holding Corporation
c/o Welsh, Carson, Anderson & Stowe
320 Park Avenue, Suite 2500
New York, New York 10022
Telephone:(212) 893-9500
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications on behalf of Bidder)
Copy to:
William J. Hewitt, Esq.
Reboul, MacMurray, Hewitt, Maynard & Kristol
45 Rockefeller Plaza
New York, New York 10111
Telephone: (212) 841-5700
<PAGE>
<PAGE #>
________________________
|CUSIP NO. |
| 21238F 10 6 |
| |
________________________
_________________________________________________________________
1. NAME OF REPORTING PERSON
S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
CDSI Holding Corporation
_________________________________________________________________
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
a) [ ]
b) [ ]
_________________________________________________________________
3. SEC USE ONLY
_________________________________________________________________
4. SOURCE OF FUNDS
BK, AF, WC
_________________________________________________________________
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) [ ]
_________________________________________________________________
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
_________________________________________________________________
7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,255,901
_________________________________________________________________
8. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES
CERTAIN SHARES [ ]
_________________________________________________________________
9. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
89.2
_________________________________________________________________
10. TYPE OF REPORTING PERSON
CO
_________________________________________________________________
<PAGE>
<PAGE #>
________________________
|CUSIP NO. |
| 21238F 10 6 |
| |
________________________
_________________________________________________________________
1. NAME OF REPORTING PERSON
S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
CDSI Acquisition Corp.
_________________________________________________________________
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
a) [ ]
b) [ ]
_________________________________________________________________
3. SEC USE ONLY
_________________________________________________________________
4. SOURCE OF FUNDS
BK, AF, WC
_________________________________________________________________
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) [ ]
_________________________________________________________________
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
_________________________________________________________________
7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,255,901
_________________________________________________________________
8. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES
CERTAIN SHARES [ ]
_________________________________________________________________
9. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
89.2
_________________________________________________________________
10. TYPE OF REPORTING PERSON
CO
_________________________________________________________________
<PAGE>
<PAGE #>
This Amendment No. 2 amends and supplements certain information
contained in the Tender Offer Statement on Schedule 14D-1 originally filed
with the Securities and Exchange Commission (the "Commission") on July 15,
1997, and amended by Amendment No. 1 thereto filed with the Commission on
August 6, 1997 (as so amended, the "Schedule 14D-1"), by CDSI Holding
Corporation, a Delaware corporation ("Parent"), and CDSI Acquisition Corp.,
a Delaware corporation and a wholly owned subsidiary of Parent (the
"Purchaser"), relating to the offer to purchase all the outstanding shares
of common stock, $.01 par value (the "Shares"), of Control Data Systems,
Inc., a Delaware corporation (the "Company"), at a purchase price of $20.25
per Share, net to the seller in cash, without interest, upon the terms and
subject to the conditions set forth in the Offer to Purchase, dated July
15, 1997 (the "Offer to Purchase"), and in the related Letter of Transmit-
tal (which, together with any amendments or supplements thereto, are
collectively referred to as the "Offer"), which are annexed to and were
filed with the Schedule 14D-1 as Exhibits (a)(1) and (a)(2), respectively.
The item numbers and responses thereto below are in accordance with the
requirements of Schedule 14D-1. Unless the context otherwise requires,
capitalized terms not otherwise defined herein have the meanings ascribed
to them in the Schedule 14D-1 and the Offer to Purchase.
ITEM 4. SOURCE AND AMOUNT OF FUNDS AND OTHER CONSIDERATION.
Item 4 is hereby amended and supplemented by adding thereto the
following:
(a)-(b) On August 11, 1997, Parent entered into a definitive
Securities Purchase Agreement (the "Securities Purchase Agreement") with
WCAS VII, certain related investors and CP III pursuant to which (i) WCAS
VII and the related investors agreed to acquire an aggregate 300,000 shares
of preferred stock and 30,000,000 shares of common stock of Parent for
aggregate consideration of $60,000,000; and (ii) CP III, agreed to acquire
units consisting of an aggregate $60,000,000 principal amount of senior
subordinated notes due 2004 and an aggregate of approximately 4.2 million
shares of common stock of Parent for a purchase price of $60,000,000. WCAS
VII also agreed, under certain circumstances, to purchase up to $30,000,000
principal amount of junior subordinated notes due 2004 of Parent.
On August 11, 1997, the Purchaser entered into a definitive
Credit Agreement (the "Credit Agreement") with NationsBank of Texas, N.A.,
as Agent, and The Bank of Nova Scotia, as Documentary Agent, providing a
tender offer credit facility of approximately $128,000,000, secured in part
by the Shares purchased pursuant to the Offer, and a bridge loan facility
of up to $85,000,000, secured in part by the Securities Purchase Agreement
referred to above.
Copies of the Securities Purchase Agreement and the Credit
Agreement are attached hereto as Exhibits (a)(11) and (a)(12), respective-
ly, and are incorporated by reference herein.
Item 10. ADDITIONAL INFORMATION.
At 12:00 midnight, New York City time, on August 11, 1997, the Offer
expired. Pursuant to the Offer, the Purchaser accepted for payment
11,255,901 Shares (including 835,028 Shares subject to guarantees of
delivery), which represent approximately 89% of the outstanding Shares, or
<PAGE #>
approximately 79% of the Shares outstanding on a fully-diluted basis
(assuming the exercise of all outstanding stock options).
Pursuant to the Merger Agreement, Parent and the Purchaser are
obligated to consummate the Merger of the Purchaser with and into the
Company as soon as practicable after approval of the Merger by the stock-
holders of the Company. The Company is obligated to take all necessary
action to call and convene a special meeting of stockholders for purposes
of considering and voting upon the Merger Agreement and the Merger as soon
as reasonably practicable. Following purchase of the Shares accepted for
payment pursuant to the Offer, the Purchaser will hold approximately 89% of
the outstanding Shares and will have sufficient voting power to approve the
Merger Agreement and the Merger without the votes of any other stockholders
of the Company.
In the Merger, each outstanding Share (other than Shares held by
the Purchaser, Parent, the Company or any of their respective subsidiaries
and Shares held by stockholders who validly perfect appraisal rights under
the Delaware General Corporation Law) will be converted into the right to
receive $20.25 per Share, net to the seller in cash, without interest. On
August 12, 1997, Parent issued a press release announcing consummation of
the Offer, a copy of which is attached hereto as Exhibit (a)(13) and
incorporated by reference herein.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
Item 11 is hereby amended and supplemented by adding the following
thereto:
(a)(11) Securities Purchase Agreement, dated as of August 11, 1997,
among CDSI Holding Corporation, Welsh, Carson, Anderson &
Stowe VII, L.P., WCAS Capital Partners III, L.P., WCAS
Information Partners, L.P. and the other Purchasers named
therein.
(a)(12) Credit Agreement, dated as of August 11, 1997, between CDSI
Acquisition Corp., NationsBank of Texas, N.A., as Agent, and
The Bank of Nova Scotia, as Documentary Agent.
(a)(13) Press Release, dated August 12, 1997, issued by CDSI Holding
Corporation.
<PAGE>
<PAGE #>
SIGNATURE
After due inquiry and to the best of his knowledge and belief, each of
the undersigned certifies that the information set forth in this statement
is true, complete and correct.
CDSI HOLDING CORPORATION
By: /s/ Thomas E. McInerney
Name: Thomas E. McInerney
Title: President
Dated: August 12, 1997
CDSI ACQUISITION CORP.
By: /s/ Thomas E. McInerney
Name: Thomas E. McInerney
Title: President
Dated: August 12, 1997
<PAGE>
<PAGE #>
EXHIBIT INDEX
Exhibit Description Page
_______ __________________________________________ ____
(a)(11) Securities Purchase Agreement, dated as of August 11,
1997, among CDSI Holding Corporation, Welsh, Carson,
Anderson & Stowe VII, L.P., WCAS Capital Partners III,
L.P., WCAS Information Partners, L.P. and the other
Purchasers named therein.
(a)(12) Credit Agreement, dated as of August 11, 1997, between
CDSI Acquisition Corp., NationsBank of Texas, N.A., as
Agent, and The Bank of Nova Scotia, as Documentary
Agent.
(a)(13) Press Release, dated August 12, 1997, issued
by CDSI Holding Corporation
Exhibit (a)(11)
___________________________________________________________________________
___________________________________________________________________________
SECURITIES PURCHASE AGREEMENT
Among
CDSI HOLDING CORPORATION
and
WELSH, CARSON, ANDERSON & STOWE VII, L.P.,
WCAS CAPITAL PARTNERS III, L.P.,
WCAS INFORMATION PARTNERS, L.P.
and
THE OTHER PARTIES NAMED ON SCHEDULE I HERETO
Dated as of August 11, 1997
___________________________________________________________________________
___________________________________________________________________________
<PAGE>
<PAGE #>
TABLE OF CONTENTS
Page
____
ARTICLE I THE SECURITIES . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.01 Purchase and Sale of the Initial
Securities . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.02 Closing Date. . . . . . . . . . . . . . . . . . . . 2
SECTION 1.03 Purchase and Sale of the Junior Notes . . . . . . . 3
ARTICLE II REPRESENTATIONS AND WARRANTIES OF THE COMPANY. . . . . . 3
SECTION 2.01 Organization, Qualifications and
Corporate Power. . . . . . . . . . . . . . . . . . 3
SECTION 2.02 Authorization of Agreements, Etc. . . . . . . . . . 4
SECTION 2.03 Validity. . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.04 Capital Stock . . . . . . . . . . . . . . . . . . . 5
SECTION 2.05 Corporate Transactions. . . . . . . . . . . . . . . 5
SECTION 2.06 Governmental Approvals. . . . . . . . . . . . . . . 5
SECTION 2.07 Offering of the Securities. . . . . . . . . . . . . 6
SECTION 2.08 Other Contracts and Commitments . . . . . . . . . . 6
SECTION 2.09 Compliance With Law . . . . . . . . . . . . . . . . 6
SECTION 2.10 Disclosure. . . . . . . . . . . . . . . . . . . . . 7
ARTICLE III REPRESENTATIONS AND WARRANTIES OF
THE PURCHASERS . . . . . . . . . . . . . . . . . . 7
ARTICLE IV CONDITIONS TO THE OBLIGATIONS OF
THE PURCHASERS . . . . . . . . . . . . . . . . . . 8
SECTION 4.01 Conditions to the Equity Closing. . . . . . . . . . 8
SECTION 4.02 Conditions to the Unit Closing. . . . . . . . . . . 9
SECTION 4.03 Conditions to the Junior Note Closing . . . . . . . 9
ARTICLE V CONDITIONS TO THE OBLIGATIONS OF THE COMPANY . . . . . . 10
ARTICLE VI MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . 10
SECTION 6.01 Expenses. . . . . . . . . . . . . . . . . . . . . . 10
SECTION 6.02 Survival of Agreements. . . . . . . . . . . . . . . 10
SECTION 6.03 Brokerage . . . . . . . . . . . . . . . . . . . . . 10
SECTION 6.04 Parties in Interest . . . . . . . . . . . . . . . . 11
SECTION 6.05 Notices . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 6.06 Law Governing . . . . . . . . . . . . . . . . . . . 11
SECTION 6.07 Entire Agreement. . . . . . . . . . . . . . . . . . 11
SECTION 6.08 Counterparts. . . . . . . . . . . . . . . . . . . . 11
SECTION 6.09 Amendments; Waivers . . . . . . . . . . . . . . . . 11
TESTIMONIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
<PAGE #>
INDEX TO EXHIBITS
Exhibit Description
_______ ___________
EXHIBIT A Form of Senior Subordinated Note
EXHIBIT B Form of Junior Subordinated Note
EXHIBIT C Form of Registration Rights Agreement
EXHIBIT D Certificate of Amendment
<PAGE>
<PAGE #>
SECURITIES PURCHASE AGREEMENT, dated as of August 11, 1997, among
CDSI HOLDING CORPORATION, a Delaware corporation (the "Company"), and
WELSH, CARSON, ANDERSON & STOWE VII, L.P., a Delaware limited partnership
("WCAS VII"), WCAS CAPITAL PARTNERS III, L.P., a Delaware limited partner-
ship ("WCAS CP III"), WCAS INFORMATION PARTNERS, L.P., a Delaware limited
partnership ("WCAS Info Partners"), and each of the other parties named on
Schedule I hereto (each of WCAS VII, WCAS CP III, WCAS Info Partners and
such parties being sometimes referred to herein individually as a "Pur-
chaser" and collectively as the "Purchasers" and the Purchasers other than
WCAS CP III being sometimes referred to herein as the "Equity Purchasers").
WHEREAS, pursuant to a tender offer (the "Offer") for all the
issued and outstanding shares of Common Stock, $.01 par value ("Target
Common Stock"), of Control Data Systems, Inc., a Delaware corporation
("Target"), CDSI Acquisition Corp., a Delaware corporation and wholly-owned
subsidiary of the Company ("Acquisition"), proposes to acquire at least 51%
of the outstanding shares of Target Common Stock on a fully diluted basis
and, subject thereto and to the satisfaction of certain other conditions,
Acquisition proposes to merge (the "Merger") with and into Target upon the
terms and subject to the conditions set forth in the Agreement and Plan of
Merger, dated as of July 8, 1997 (the "Merger Agreement"), among Target,
the Company and Acquisition; and
WHEREAS, subject to and simultaneously with the closing of the
Offer, and subject to the other terms and conditions set forth herein, the
Company wishes to sell (i) to each Equity Purchaser, the number of shares
of Common Stock, $.01 par value, of the Company ("Common Stock") and Pre-
ferred Stock, $1.00 par value, of the Company ("Preferred Stock") set forth
opposite the name of such Purchaser in Schedule I hereto and (ii) to WCAS
CP III, units (the "Units") consisting of $60,000,000 aggregate principal
amount of 10% Senior Subordinated Notes Due 2004 of the Company substan-
tially in the form of Exhibit A hereto (the "Senior Notes") and 4,285,714
shares of Common Stock; and
WHEREAS the Company wishes to obtain the commitment of WCAS VII
to purchase, subject to the terms and conditions set forth herein, up to
$25 million of 12% Junior Subordinated Notes Due 2004 of the Company
substantially in the form of Exhibit B hereto (the "Junior Notes" and,
together with the Senior Notes, the "Notes"); and
WHEREAS the Purchasers, severally, wish to purchase said securi-
ties, all on the terms and subject to the conditions hereinafter set forth;
<PAGE #>
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereby agree as follows:
I.
THE SECURITIES
SECTION 1.01 Purchase and Sale of the Initial Securities. (a)
___________________________________________
Subject to the terms and conditions set forth herein, the Company shall
issue and sell to the Purchasers, and each Purchaser shall purchase from
the Company on the applicable Closing Date (as hereinafter defined), the
number of shares of Preferred Stock, Common Stock and/or Units set forth
opposite the name of such Purchaser on Schedule I hereto (such shares of
Preferred Stock being called the "Preferred Shares," such shares of Common
Stock being together called the "Common Shares," and the Preferred Shares,
the Common Shares and the Units being together called the "Initial Securi-
ties") for $100 per Preferred Share, $5.00 per Common Share and $1,000 per
Unit, or an aggregate purchase price of $120,000,000. The Company shall
issue and deliver to each Equity Purchaser stock certificates in definitive
form, registered in the name of such Equity Purchaser, evidencing the
Preferred Shares and Common Shares being purchased by such Equity Purchaser
hereunder and, in the case of WCAS CP III, shall execute and deliver Senior
Notes in the aggregate principal amount of $60,000,000 and stock certifi-
cates in definitive form, registered in the name of WCAS CP III, evidencing
an aggregate 4,285,714 shares of Common Stock.
(a) As payment in full for the Initial Securities being pur-
chased by it hereunder, and against delivery thereof as aforesaid, on the
applicable Closing Date each Purchaser shall transfer to the account of the
Company by wire transfer the amount set forth opposite such Purchaser's
name on Schedule I hereto under the caption "Total Price."
SECTION 1.02 Closing Dates. The closing of the sale and pur-
_____________
chase of the Preferred Shares and the Common Shares to the Equity Purchas-
ers shall take place at the offices of Reboul, MacMurray, Hewitt, Maynard &
Kristol, 45 Rockefeller Plaza, New York, New York 10111, at 10 a.m., New
York time, on August 12, 1997, or at such other date and time as may be
mutually agreed upon among the Equity Purchasers and the Company (such date
and time of closing being herein called the "Equity Closing Date"). The
closing of the sale of the Units to WCAS CP III shall take place at the
offices of Reboul, MacMurray, Hewitt, Maynard & Kristol, 45 Rockefeller
Plaza, New York, New York 10111, at 10 a.m., New York time, on August 14,
1997, or at such other date and time as may be mutually agreed between WCAS
CP III and the Company (such date and time of closing being herein called
the
<PAGE #>
"Unit Closing Date"). Each closing of a sale and purchase of the Junior
Notes referred to in Section 1.03 below shall take place at the offices of
Reboul, MacMurray, Hewitt, Maynard & Kristol, 45 Rockefeller Plaza, New
York, New York 10111, at 10 a.m., New York time, on the date that is five
business days after the giving of the relevant notice by the Company, at
such time as may be mutually agreed upon between WCAS VII and the Company
(each such date and time of closing being herein called a "Junior Note
Closing Date" and, each of the Equity Closing Date, the Unit Closing Date
and each Junior Note Closing Date being herein called a "Closing Date").
SECTION 1.03 Purchase and Sale of the Junior Notes. Subject to
_____________________________________
the terms and conditions set forth herein, the Company shall have the
right, at any time and from time to time upon ten days' written notice to
WCAS VII, to sell to WCAS VII (and, subject to such terms and conditions,
WCAS VII shall have the obligation to purchase from the Company by payment
of the purchase price therefor in accordance with such notice or notices)
up to $30,000,000 aggregate principal amount of Junior Notes (the Junior
Notes, together with the Initial Securities, being herein called the
"Securities"). Such right shall expire and terminate upon the first to
occur of (i) the consummation of the "Merger," as such term is defined in
the Agreement and Plan of Merger dated as of July 8, 1997 among the
Company, Acquisition and Control Data Corporation, and (ii) the payment in
full of all "Term A Advances," as such term is defined in the Credit Agree-
ment dated as of the date hereof among Acquisition, the Initial Lenders
named therein, NationsBank of Texas, N.A., as Agent, and The Bank of Nova
Scotia, as Documentation Agent. WCAS VII acknowledges that the Company's
rights under this Section 1.03 may, under certain circumstances, be
exercised by the Agent under the Security Agreement dated as of the date
hereof among the Company, Acquisition and NationsBank of Texas, N.A., as
Agent.
II.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to, and agrees with, each
Purchaser as follows:
SECTION 2.01 Organization, Qualifications and Corporate Power.
________________________________________________
(a) Each of the Company and Acquisition, is a corporation duly incorporat-
ed, validly existing and in good standing under the laws of the State
of Delaware and is duly licensed or qualified to do business as a foreign
corporation and is in good standing in each other jurisdiction in which the
nature of business transacted by it makes such licensing or qualification
necessary and where the failure to so qualify would
<PAGE #>
in the aggregate have a material adverse effect on the Company or Acquisi-
tion. Each of the Company and Acquisition has the corporate power and
authority to own and hold its properties and to carry on its business as
currently conducted and, in the case of the Company, to execute, deliver
and perform this Agreement and the Registration Rights Agreement substan-
tially in the form attached hereto as Exhibit C (the "Registration Rights
Agreement") and to issue, sell and deliver the Securities.
(b) Except, in the case of the Company, for all the outstanding
capital stock of Acquisition, neither the Company nor Acquisition owns of
record or beneficially, directly or indirectly, (i) any shares of outstand-
ing capital stock or securities convertible into capital stock of any other
corporation or (ii) any participating interest in any partnership, joint
venture or other non-corporate business enterprise.
SECTION 2.02 Authorization of Agreements, Etc. (a) The execu-
________________________________
tion and delivery by the Company of this Agreement and the Registration
Rights Agreement, the performance by the Company of its obligations
hereunder and thereunder and the issuance, sale and delivery of the
Securities have been duly authorized by all requisite corporate action and
will not violate any provision of law, any order of any court or other
agency of government, the Certificate of Incorporation or By-laws of the
Company or, or any provision of any indenture, agreement or other instru-
ment by which the Company or Acquisition or any of their respective
properties or assets is bound or affected, or conflict with, result in a
breach of or constitute (with due notice or lapse of time or both) a
default under any such indenture, agreement or other instrument, or result
in the creation or imposition of any lien, charge or encumbrance of any
nature whatsoever upon any of the properties or assets of the Company or
Acquisition.
(b) Upon the filing of a Certificate of Amendment to the
Certificate of Incorporation substantially in the form of Exhibit D hereto
(the "Certificate of Amendment") with the Secretary of State of the State
of Delaware, the Common Stock and the Preferred Stock will be duly autho-
rized by the Company and, when sold and paid for in accordance with this
Agreement, will be validly issued, fully paid and nonassessable shares of
Common Stock and Preferred Stock, respectively, free and clear of all
liens, charges, taxes, pledges, security interests, adverse claims or other
encumbrances or restrictions on transfer (other than any restrictions under
the Securities Act of 1933, as amended, and state securities laws). The
Notes have been duly authorized and when delivered in accordance with this
Agreement, will constitute the legal, valid and binding obligation of the
Company, enforceable in accordance with their terms. The issuance, sale
and delivery of the Securities to the Purchasers hereunder are not subject
to any preemptive rights of stockhold-
<PAGE #>
ers of the Company or to any right of first refusal or other similar right
in favor of any person.
SECTION 2.03 Validity. This Agreement has been duly executed
________
and delivered by the Company and constitutes the legal, valid and binding
obligation of the Company, enforceable against the Company in accordance
with its terms. The Notes and the Registration Rights Agreement, when
executed and delivered by the Company as provided in this Agreement, will
constitute legal, valid and binding obligations of the Company, enforceable
against the Company in accordance with their respective terms.
SECTION 2.04 Capital Stock. (a) The authorized capital stock
_____________
of the Company consists of 1,000 shares of Common Stock, $1.00 par value,
of which 1,000 shares (the "Company Organization Shares") are issued and
outstanding, fully paid and nonassessable and held beneficially and of
record by WCAS VII. On the Closing Date, upon filing of the Certificate
of Amendment, the authorized capital stock of the Company shall consist of
50,000,000 shares of Common Stock, $.01 par value, and 300,000 shares of
Preferred Stock, $1.00 par value. After giving effect to the transactions
contemplated hereby, on the Closing Date, 34,285,714 shares of Common Stock
and 300,000 shares of Preferred Stock shall be issued and outstanding.
(b) Except as provided in this Agreement and the Certificate of
Amendment (i) no subscription, warrant, option, convertible security or
other right (contingent or other) to purchase or acquire any shares of any
class of capital stock of the Company is authorized or outstanding,
(ii) there is not any commitment of the Company to issue any shares,
warrants, options or other such rights or to distribute to holders of any
class of the Company's capital stock any evidences of indebtedness or
assets, (iii) the Company has no obligation (contingent or other) to pur-
chase, redeem or otherwise acquire any shares of its capital stock or any
interest therein or to pay any dividend or make any other distribution in
respect thereof, (iv) there are no outstanding stock appreciation rights,
phantom stock or similar rights with respect to the Company's capital stock
and (v) there are no voting trusts, proxies or other agreements or under-
standings with respect to the voting of the capital stock of the Company.
SECTION 2.05 Corporate Transactions. The Company was incorpo-
______________________
rated on July 3, 1997, and has not conducted any business or otherwise
entered into any transactions other than (i) the organization of the
Company, including adoption of By-laws, election of directors and officers,
(ii) the authorization, execution and delivery of this Agreement and the
Registration Rights Agreement and the transactions contemplated hereby and
thereby and (iii) the agreements referred to in Section 2.08 below and the
transactions contemplated thereby.
<PAGE #>
SECTION 2.06 Governmental Approvals. No registration or filing
______________________
with, or consent or approval of, or other action by, any federal, state or
other governmental agency or instrumentality is at this time necessary for
the valid execution, delivery and performance of this Agreement or the
issuance, sale and delivery by the Company of the Securities.
SECTION 2.07 Offering of the Securities. Neither the Company
__________________________
nor any person authorized or employed by the Company as agent, broker,
dealer or otherwise in connection with the offering or sale of the Securi-
ties or any similar security of the Company has offered the Securities or
any such security for sale to, or solicited any offers to buy the Securi-
ties or any similar security of the Company from, or otherwise approached
or negotiated with respect thereto with, any person or persons other than
the Purchasers and neither the Company nor any person acting on its behalf
has taken or will take any action (including, without limitation, any
offer, issuance or sale of any security of the Company under circumstances
which require the integration of such security with the Securities under
the Securities Act of 1933, as amended (the "Securities Act"), or the rules
and regulations of the Securities and Exchange Commission promulgated
thereunder) which might subject the offering, issuance or sale of the
Securities to the registration provisions of the Securities Act.
SECTION 2.08 Other Contracts and Commitments.
_______________________________
Neither the Company nor Acquisition, is a party to any material contract or
commitment (or material group of related contracts or commitments), other
than the Merger Agreement. Neither the Company nor Acquisition is in
default in the performance, observance or fulfillment of any of the obliga-
tions, covenants or conditions contained in any agreement or instrument to
which it is a party and no event or condition has occurred which, with the
giving of notice or lapse of time, or both, would constitute such a de-
fault, which may result in any material adverse change in the business,
operations or financial condition of the Company or Acquisition.
SECTION 2.09 Compliance With Law. Neither the Company nor
___________________
Acquisition is in default under any order of any court, governmental
authority or arbitration board or tribunal to which the Company or Acquisi-
tion is or was subject or in violation of any laws, ordinances, governmen-
tal rules or regulations to which the Company or Acquisition is or was
subject, which default or violation would have a material adverse effect on
its business, operations or financial condition. The business of each of
the Company and Acquisition is being conducted in compliance with all laws,
ordinances, rules and regulations applicable to it, the failure to comply
with which would have a material adverse effect on its business operations
or financial condition. Neither the Company nor Acquisition has failed to
obtain any licenses, permits, franchises or other governmental authori-
<PAGE #>
zations necessary to the ownership of the respective properties of the
Company and Acquisition or to the conduct of the business of the Company or
Acquisition which, if not so obtained, would have a material adverse effect
on its business, operations or financial condition.
SECTION 2.10 Disclosure. None of this Agreement or any agree-
__________
ment, document, certificate or written statement furnished or to be
furnished to the Purchasers by or on behalf of the Company in connection
with the transactions contemplated hereby, taken together on the date
hereof contains, and taken together on the Closing Date will contain, any
untrue statement of material fact or omits to state any material fact
necessary in order to make the statements contained herein or therein, in
light of the circumstances under which they are made, not misleading.
There is no fact known to the Company which would materially adversely
affect the business, properties, assets, condition or prospects, financial
or otherwise, of the Company or Acquisition which has not been disclosed
herein or therein.
III.
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
Each Purchaser, severally and not jointly, represents and
warrants to the Company that it is acquiring the Securities for its own
account for the purpose of investment and not with a view to or for sale in
connection with any distribution thereof. Each Purchaser further represents
that it understands that (i) the Securities have not been registered under
the Securities Act by reason of their issuance in a transaction exempt from
the registration requirements of the Securities Act pursuant to Section
4(2) or thereof, (ii) the Securities must be held indefinitely unless a
subsequent disposition thereof is registered under the Securities Act or is
exempt from such registration, (iii) the Securities will bear a legend to
such effect and (iv) the Company will make a notation on its transfer books
to such effect. Each Purchaser further understands that the exemption from
registration afforded by Rule 144 under the Securities Act depends on the
satisfaction of various conditions and that, if applicable, Rule 144
affords the basis of sales of the Securities in limited amounts under
certain conditions. Each Purchaser acknowledges that it has had a full
opportunity to request from the Company and to review and has received all
information which it deems relevant in making a decision to purchase the
Securities hereunder. Each Purchaser is an "accredited investor" within
the meaning of Rule 501(a) of the Securities Act. Each Purchaser has all
requisite power and authority to enter into this Agreement and to perform
its obligations hereunder.
<PAGE #>
IV.
CONDITIONS TO THE OBLIGATIONS OF THE PURCHASERS
SECTION 4.01 Conditions to the Equity Closing. The obligations
________________________________
of the Equity Purchasers to purchase and pay for the Initial Securities on
the Equity Closing Date hereunder are, at their option, subject to the
satisfaction, on or before such date, of the following conditions:
(a) Satisfaction of Certain Conditions relating to the Offer. All
________________________________________________________
the conditions to Acquisition's accepting for payment the shares of Target
Common Stock tendered pursuant to the Offer shall have been satisfied or
waived with the consent of the Purchasers and Subsidiary shall have
accepted for payment such shares of Target Common Stock in accordance with
the Merger Agreement.
(b) Representations and Warranties to Be True and Correct. The
_____________________________________________________
representations and warranties contained in Article II hereof shall be true
and correct on and as of the Closing Date with the same effect as though
such representations and warranties had been made on and as of such date,
and the Company shall have certified to such effect to the Purchasers in
writing.
(c) Performance. The Company shall have performed and complied with
___________
all agreements and conditions contained herein required to be performed or
complied with by it prior to or at the Closing Date, and the Company shall
have certified to such effect to the Purchasers in writing.
(d) All Proceedings to Be Satisfactory. All corporate and other
__________________________________
proceedings to be taken by the Company in connection with the transactions
contemplated hereby and all documents incident thereto shall be satisfacto-
ry in form and substance to the Purchasers, and the Purchasers shall have
received all such counterpart originals or certified or other copies of
such documents as they may reasonably request.
(e) Opinion of Counsel. The Purchasers shall have received from
__________________
Reboul, MacMurray, Hewitt, Maynard & Kristol, counsel for the Company and
Acquisition, an opinion dated the Closing Date in form and substance
reasonably satisfactory to the Equity Purchasers.
(f) Registration Rights Agreement. On the Closing Date, the Company
_____________________________
shall have executed and delivered the Registration Rights Agreement.
(g) Certificate of Amendment. On or prior to the Closing Date, the
________________________
Company shall have executed and filed with the Secre-
<PAGE #>
tary of State of the State of Delaware the Certificate of Amendment.
(h) Contribution of Holdings Organization Shares. On or prior to the
____________________________________________
Closing Date, WCAS VII shall have contributed the Company Organization
Shares to the capital of the Company.
SECTION 4.02 Conditions to the Unit Closing. The obligation
______________________________
of WCAS CP III to purchase and pay for the Units on the Unit Closing Date
hereunder are, at its option, subject to the satisfaction, on or before
such date, of the following conditions:
(a) Satisfaction of Equity Closing Conditions. All conditions to the
_________________________________________
obligations of the Equity Purchasers set forth in Section 4.01 above shall
have been satisfied without material amendment or waiver.
(b) Acquisition of Target Common Stock. Acquisition shall have
__________________________________
accepted for payment and paid for at least 51% of the outstanding shares of
Target Common Stock on a fully diluted basis.
(c) Opinion of Counsel. WCAS CP III shall have received from Reboul,
__________________
MacMurray, Hewitt, Maynard & Kristol, counsel for the Company and Acquisi-
tion, an opinion dated the Closing Date in form and substance reasonably
satisfactory to WCAS CP III.
SECTION 4.03 Conditions to the Junior Note Closing. The
_____________________________________
obligation of WCAS VII to purchase and pay for Junior Notes on any Junior
Note Closing Date hereunder are, at its option, subject to the satisfac-
tion, on or before such date, of the following conditions:
(a) Satisfaction of Unit Closing Conditions. All conditions to the
_______________________________________
obligations of WCAS CP III set forth in Section 4.02 above shall have been
satisfied without material amendment or waiver.
(b) No Defaults. There shall not have occurred or be continuing any
___________
defaults under any then outstanding Junior Notes.
(c) Use of Proceeds. The Company shall have demonstrated to the
_______________
satisfaction of WCAS VII that the proceeds of such sale of Junior Notes
shall be applied exclusively to repay then outstanding "Term A Advances"
under the Credit Agreement described in Section 1.03 hereof.
(d) Opinion of Counsel. WCAS VII shall have received from Reboul,
__________________
MacMurray, Hewitt, Maynard & Kristol, counsel for the Company and Acquisi-
tion, an opinion dated the Closing Date in form and substance reasonably
satisfactory to WCAS VII.
<PAGE #>
V.
CONDITIONS TO THE OBLIGATIONS OF THE COMPANY
The obligation of the Company to issue and deliver the Securities
being sold by it on any Closing Date hereunder is, at its option, subject
to the satisfaction, on or before such date, of the following conditions:
(a) Representations and Warranties to Be True and Correct. The
_____________________________________________________
representations and warranties contained in Article III hereof made by the
Purchasers purchasing Securities on such Closing Date shall be true and
correct on and as of such Closing Date with the same effect as though such
representations and warranties had been made on as of such date.
(b) Performance. The Purchasers purchasing Securities on such
___________
Closing Date shall have performed and complied with all agreements and
conditions contained herein as required to be performed or complied with by
them prior to or at such Closing Date.
(c) Corporate Proceedings; Consents. All corporate and other
_______________________________
proceedings to be taken and all waivers and consents to be obtained in
connection with the transactions contemplated hereby shall have been taken
or obtained to the reasonable satisfaction of the Company and its counsel.
VI.
MISCELLANEOUS
SECTION 6.01 Expenses. Each party hereto shall pay its own
________
expenses.
SECTION 6.02 Survival of Agreements. All covenants, agree-
______________________
ments, representations and warranties made herein shall survive the
execution and delivery of this Agreement and the issuance, sale and
delivery of the Securities pursuant hereto, and all statements contained in
any certificate or other instrument delivered by the Company hereunder
shall be deemed to constitute representations and warranties made the
Company.
SECTION 6.03 Brokerage. Each party hereto will indemnify and
_________
hold harmless the other party hereto against and in respect of any claim
for brokerage or other commissions relative to this Agreement or to the
transactions contemplated hereby, based in any way on agreements, arrange-
ments or understandings made or claimed to have been made by such party
with any third party. Each party hereto represents and warrants that no
broker, finder or investment banker is entitled to any brokerage, find-
<PAGE #>
er's or other fee or commission in connection with the transactions
contemplated by this Agreement.
SECTION 6.04 Parties in Interest. All covenants and agreements
___________________
contained in this Agreement by or on behalf of any party hereto shall bind
and inure to the benefit of the respective successors and assigns of the
parties hereto whether so expressed or not.
SECTION 6.05 Notices. All notices, requests, consents and
_______
other communications hereunder shall be in writing and shall be personally
delivered or mailed by first-class registered mail, postage prepaid, or
sent by a recognized courier service, addressed as follows:
(a) if to the Company, at 320 Park Avenue, Suite 2500, New York,
New York 10022; Attention: Thomas E. McInerney, President, with a copy
to William J. Hewitt, Reboul, MacMurray, Hewitt, Maynard & Kristol, 45
Rockefeller Plaza, New York, New York 10111;
(b) if to a Purchaser, at 320 Park Avenue, Suite 2500, New York,
New York 10022; Attention: Thomas E. McInerney; and
(c) if to any subsequent holder of Securities, to such holder at
its address appearing on the stock transfer records of the Company.
or, in any such case, at such other address or addresses as shall have been
furnished in writing by such party to the others.
SECTION 6.06 Law Governing. This Agreement shall be governed
_____________
by and construed in accordance with the laws of the State of New York.
SECTION 6.07 Entire Agreement. This Agreement constitutes the
________________
entire Agreement of the parties with respect to the subject matter hereof
and may not be modified or amended except in writing.
SECTION 6.08 Counterparts. This Agreement may be executed in
____________
two or more counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.
SECTION 6.09 Amendments; Waivers. This Agreement may be
___________________
amended, and compliance by the Company with any of the provisions of this
Agreement may be waived, by written instrument signed by the Company and
the Purchasers.
<PAGE>
<PAGE #>
IN WITNESS WHEREOF, the Company and the Purchasers have executed
this Agreement as of the day and year first above written.
CDSI HOLDING CORPORATION
By /s/Thomas E. McInerney
Name: Thomas E. McInerney
Title: President
WELSH, CARSON, ANDERSON &
STOWE VII, L.P., By WCAS VII
Partners, L.P., General Partner
By /s/Laura M. VanBuren
General Partner
WCAS CAPITAL PARTNERS III, L.P., By
WCAS CP III Associates L.L.C.,
General Partner
By /s/Laura M. VanBuren
Managing Member
WCAS INFORMATION PARTNERS, L.P., By
WCAS Info Partners, L.P., General
Partner
By /s/Laura M. VanBuren*
General Partner
/s/Laura M. VanBuren*
Patrick J. Welsh
/s/Laura M. VanBuren*
Russell L. Carson
<PAGE #>
/s/Laura M. VanBuren*
Bruce K. Anderson
DELAWARE CHARTER TRUST CO.
as TTEE-FBO The IRA Rollover
of Richard H. Stowe
By /s/Richard H. Stowe
Title:
/s/Thomas E. McInerney
Thomas E. McInerney
/s/Andrew M. Paul
Andrew M. Paul
/s/James B. Hoover
James B. Hoover
DELAWARE CHARTER TRUST CO.
as TTEE-FBO The IRA Rollover
of James B. Hoover
By /s/James B. Hoover
Title:
/s/Robert A. Minicucci
Robert A. Minicucci
/s/Laura M. VanBuren*
Anthony J. de Nicola
/s/Laura M. VanBuren*
Paul B. Queally
<PAGE #>
/s/Laura M. VanBuren
Laura M. VanBuren
*Attorney-in-fact
/s/Rudolph E. Rupert
Rudolph E. Rupert
Exhibit (a)(12)
<PAGE #>
EXECUTION COPY
$213,000,000
CREDIT AGREEMENT
Dated as of August 11, 1997
Among
CDSI ACQUISITION CORP.
as Borrower
__ ________
and
THE INITIAL LENDERS NAMED HEREIN
as Initial Lenders
__ _______ _______
and
NATIONSBANK OF TEXAS, N.A.
as Administrative Agent and Collateral Agent
__ ______________ _____ ___ __________ _____
and
THE BANK OF NOVA SCOTIA
as Documentation Agent
__ _____________ _____
<PAGE>
<PAGE #>
T A B L E O F C O N T E N T S
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01. Certain Defined Terms . . . . . . . . . . . . . . . . . . . 1
1.02. Computation of Time Periods . . . . . . . . . . . . . . . . 15
1.03. Accounting Terms. . . . . . . . . . . . . . . . . . . . . . 15
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
2.01. The Advances. . . . . . . . . . . . . . . . . . . . . . . . 15
2.02. Making the Advances . . . . . . . . . . . . . . . . . . . . 16
2.03. Repayment of Advances . . . . . . . . . . . . . . . . . . . 17
2.04. Termination or Reduction of the Commitments . . . . . . . . 17
2.05. Prepayments . . . . . . . . . . . . . . . . . . . . . . . . 17
2.06. Interest. . . . . . . . . . . . . . . . . . . . . . . . . . 18
2.07. Agent's Fees. . . . . . . . . . . . . . . . . . . . . . . . 18
2.08. Conversion of Advances. . . . . . . . . . . . . . . . . . . 18
2.09. Increased Costs, Etc. . . . . . . . . . . . . . . . . . . . 19
2.10. Payments and Computations . . . . . . . . . . . . . . . . . 20
2.11. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.12. Sharing of Payments, Etc. . . . . . . . . . . . . . . . . . 22
2.13. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . 23
2.14. Defaulting Lenders. . . . . . . . . . . . . . . . . . . . . 23
ARTICLE III
CONDITIONS OF LENDING
3.01. Conditions Precedent to Initial Extension of Credit . . . . 25
3.02. Conditions Precedent to Each Borrowing. . . . . . . . . . . 29
3.03. Determinations Under Section 3.01 . . . . . . . . . . . . . 29
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.01. Representations and Warranties of the Borrower. . . . . . . 29
ARTICLE V
COVENANTS OF THE BORROWER
5.01. Affirmative Covenants . . . . . . . . . . . . . . . . . . . 33
5.02. Negative Covenants. . . . . . . . . . . . . . . . . . . . . 36
5.03. Reporting Requirements. . . . . . . . . . . . . . . . . . . 38
ARTICLE VI
EVENTS OF DEFAULT
6.01. Events of Default . . . . . . . . . . . . . . . . . . . . . 41
ARTICLE VII
THE AGENT
7.01. Authorization and Action. . . . . . . . . . . . . . . . . . 43
7.02. Agent's Reliance, Etc.. . . . . . . . . . . . . . . . . . . 44
7.03. NationsBank and Affiliates. . . . . . . . . . . . . . . . . 44
7.04. Lender Credit Decision. . . . . . . . . . . . . . . . . . . 44
7.05. Indemnification . . . . . . . . . . . . . . . . . . . . . . 44
7.06. Successor Agents. . . . . . . . . . . . . . . . . . . . . . 45
ARTICLE VIII
MISCELLANEOUS
8.01. Amendments, Etc.. . . . . . . . . . . . . . . . . . . . . . 45
8.02. Notices, Etc. . . . . . . . . . . . . . . . . . . . . . . . 46
8.03. No Waiver; Remedies . . . . . . . . . . . . . . . . . . . . 46
8.04. Costs and Expenses. . . . . . . . . . . . . . . . . . . . . 46
8.05. Right of Set-off. . . . . . . . . . . . . . . . . . . . . . 48
8.06. Binding Effect. . . . . . . . . . . . . . . . . . . . . . . 48
8.07. Assignments and Participations. . . . . . . . . . . . . . . 48
8.08. Execution in Counterparts . . . . . . . . . . . . . . . . . 50
8.09. Confidentiality . . . . . . . . . . . . . . . . . . . . . . 50
8.10. Jurisdiction, Etc.. . . . . . . . . . . . . . . . . . . . . 50
8.11. Governing Law . . . . . . . . . . . . . . . . . . . . . . . 51
8.12. Waiver of Jury Trial. . . . . . . . . . . . . . . . . . . . 51
SCHEDULES
Schedule I - Commitments and Applicable Lending Offices
Schedule 3.01(h) - [Intentionally Omitted]
Schedule 4.01(a) - Equity Investors
Schedule 4.01(d) - Authorizations, Approvals, Actions, Notices and
Filings
Schedule 4.01(u) - Existing Debt
EXHIBITS
Exhibit A-1 - Form of Term A Note
Exhibit A-2 - Form of Term B Note
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Borrower Pledge Agreement
Exhibit E - Form of Holdings Pledge Agreement
Exhibit F - Form of Security Agreement
Exhibit G - Form of Holdings Guaranty
Exhibit H - Form of Welsh Carson Guaranty
Exhibit I - Form of Opinion of Counsel to the Loan Parties
<PAGE>
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of August 11, 1997 among CDSI ACQUISI-
TION CORP., a Delaware corporation (the "Borrower"), the banks, financial
________
institutions and other institutional lenders listed on the signature pages
hereof as the Initial Lenders (the "Initial Lenders"), NATIONSBANK OF
_______________
TEXAS, N.A. ("NationsBank"), as administrative agent and collateral agent
___________
(together with any successor appointed pursuant to Article VII, the
"Agent") for the Lenders (as hereinafter defined) and THE BANK OF NOVA
_____
SCOTIA, as documentation agent (the "Documentation Agent").
___________________
PRELIMINARY STATEMENTS:
(1) The Borrower is a wholly owned Subsidiary (as hereinafter
defined) of CDSI Holding Corporation, a Delaware corporation ("Holdings"),
________
which was organized by Welsh Carson (as hereinafter defined) to acquire
control of Control Data Systems, Inc., a Delaware corporation (the "Compa-
______
ny"). Pursuant to an Offer to Purchase dated as of July 15, 1997 (as
__
amended, supplemented or otherwise modified from time to time in accordance
with its terms, to the extent permitted in accordance with the Loan
Documents (as hereinafter defined), the "Offer to Purchase"), the Borrower
_________________
has offered to purchase all of the shares of the Company's outstanding
common stock, $0.01 par value (the "Company Stock"), for $20.25 in cash per
_____________
share (the "Tender Offer"). The Tender Offer is being made pursuant to an
____________
Agreement and Plan of Merger dated as of July 8, 1997 (as amended, supple-
mented or otherwise modified in accordance with its terms, to the extent
permitted in accordance with the Loan Documents, the "Merger Agreement",
________________
subject to the terms and conditions set forth therein) among Holdings, the
Borrower and the Company. Pursuant to the Merger Agreement, the Borrower
has agreed to consummate a merger (the "Merger") with the Company in which
______
the Company will be the surviving corporation (the "Surviving Corpora-
__________________
tion").
____
(2) The Borrower has requested that, upon the consummation of
the Tender Offer, the Lenders lend to the Borrower up to $213,000,000,
consisting of $85,200,000 under the Term A Facility and $127,800,000 under
the Term B Facility in order to pay to the holders of the Company Stock
(other than the Borrower) the cash consideration for their shares in the
Tender Offer, pay interest on borrowings hereunder, and pay transaction
fees and expenses and for certain other purposes as provided herein. The
Lenders have indicated their willingness to agree to lend such amounts on
the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements contained herein, the parties hereto hereby
agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this Agreement,
_____________________
the following terms shall have the following meanings (such meanings to be
equally applicable to both the singular and plural forms of the terms
defined):
"Advance" means a Term A Advance or a Term B Advance.
_______
"Affiliate" means, as to any Person, any other Person that,
_________
directly or indirectly, controls, is controlled by or is under common
control with such Person or is a director or officer of such
<PAGE #>
Person. For purposes of this definition, the term "control" (includ-
ing the terms "controlling", "controlled by" and "under common control
with") of a Person means the possession, direct or indirect, of the
power to vote 5% or more of the Voting Stock of such Person or to
direct or cause the direction of the management and policies of such
Person, whether through the ownership of Voting Stock, by contract or
otherwise.
"Agent" has the meaning specified in the recital of parties to
_____
this Agreement.
"Agent's Account" means the account of the Agent maintained by
_______________
the Agent with NationsBank at its office at 901 Main Street, 14th
Floor, Dallas, Texas 75202, Account No. 1292000883, Attention: Gilda
Digges.
"Applicable Lending Office" means, with respect to each Lender,
_________________________
such Lender's Domestic Lending Office in the case of a Prime Rate
Advance and such Lender's Eurodollar Lending Office in the case of a
Eurodollar Rate Advance.
"Applicable Margin" means (a) 0.0% per annum for Prime Rate
_________________
Advances and 0.875% per annum for Eurodollar Rate Advances outstanding
under the Term A Facility and (b) 1.00% for Advances outstanding under
the Term B Facility.
"Assignment and Acceptance" means an assignment and acceptance
_________________________
entered into by a Lender and an Eligible Assignee, and accepted by the
Agent, in accordance with Section 8.07 and in substantially the form
of Exhibit C hereto.
"Borrower" has the meaning specified in the recital of parties to
________
this Agreement.
"Borrower Pledge Agreement" has the meaning specified in Section
_________________________
3.01(m)(viii).
"Borrower's Account" means the account of the Borrower maintained
__________________
by the Borrower with NationsBank at its office at 901 Main Street,
14th Floor, Dallas, Texas 75202, Account No. [1292000883].
"Borrowing" means a Term A Borrowing or a Term B Borrowing.
_________
"Business Day" means a day of the year on which banks are not
____________
required or authorized by law to close in Dallas, Texas or New York,
New York and, if the applicable Business Day relates to any Eurodollar
Rate Advances, on which dealings are carried on in the London inter-
bank market.
"Capital Expenditures" means, for any Person for any period, the
____________________
sum of, without duplication, (a) all expenditures made, directly or
indirectly, by such Person or any of its Subsidiaries during such
period for equipment, fixed assets, real property or improvements, or
for replacements or substitutions therefor or additions thereto, that
have been or should be, in accordance with GAAP, reflected as addi-
tions to property, plant or equipment on a Consolidated balance sheet
of such Person or have a useful life of more than one year plus
(b) the aggregate principal amount of all Debt (including Obligations
under Capitalized Leases) assumed or incurred in connection with any
such expenditures.
"Capitalized Leases" means all leases that have been or should
__________________
be, in accordance with GAAP, recorded as capitalized leases.
<PAGE #>
"Cash Equivalents" means any of the following, to the extent
________________
owned by the Borrower or any of its Subsidiaries free and clear of all
Liens and having a maturity of not greater than 90 days from the date
of thereof: (a) readily marketable direct obligations of the Govern-
ment of the United States or any agency or instrumentality thereof or
obligations unconditionally guaranteed by the full faith and credit of
the Government of the United States, (b) insured certificates of
deposit of or time deposits with any commercial bank that is a Lender
or a member of the Federal Reserve System, issues (or the parent of
which issues) commercial paper rated as described in clause (c), is
organized under the laws of the United States or any State thereof and
has combined capital and surplus of at least $1 billion or
(c) commercial paper in an aggregate amount of no more than $5,000,000
per issuer outstanding at any time, issued by any corporation orga-
nized under the laws of any State of the United States and rated at
least "Prime-1" (or the then equivalent grade) by Moody's Investors
Service, Inc. or "A-1" (or the then equivalent grade) by Standard &
Poor's Ratings Group.
"CERCLA" means the Comprehensive Environmental Response, Compen-
______
sation and Liability Act of 1980, as amended from time to time.
"CERCLIS" means the Comprehensive Environmental Response, Compen-
_______
sation and Liability Information System maintained by the U.S. Envi-
ronmental Protection Agency.
"Collateral" means all "Collateral" referred to in the Collateral
__________
Documents and all other property that is or is intended to be subject
to any Lien in favor of the Agent for the benefit of the Secured
Parties.
"Collateral Documents" means the Security Agreement (including
____________________
the Consent and Agreement in the form attached as an exhibit thereto),
the Borrower Pledge Agreement, the Holdings Pledge Agreement and any
other agreement that creates or purports to create a Lien in favor of
the Agent for the benefit of the Secured Parties.
"Commitment" means a Term A Commitment or a Term B Commitment.
__________
"Company" has the meaning specified in the Preliminary State-
_______
ments.
"Company Stock" has the meaning specified in the Preliminary
_____________
Statements.
"Confidential Information" means information that the Borrower
________________________
furnishes to the Agent or any Lender in a writing designated as
confidential, but does not include any such information that is or
becomes generally available to the public or that is or becomes
available to the Agent or such Lender from a source other than the
Borrower.
"Consolidated" refers to the consolidation of accounts in accor-
____________
dance with GAAP.
"Control Date" means the date on which Persons designated or
____________
approved by the Borrower constitute a majority of the board of direc-
tors of the Company.
"Conversion", "Convert" and "Converted" each refer to a conver-
__________ _______ _________
sion of Advances of one Type into Advances of the other Type pursuant
to Section 2.08 or 2.09.
"Debt" of any Person means, without duplication, (a) all indebt-
____
edness of such Person for borrowed money, (b) all Obligations of such
Person for the deferred purchase price of property or
<PAGE #>
services (other than trade payables not overdue by more than 60 days
incurred in the ordinary course of such Person's business), (c) all
Obligations of such Person evidenced by notes, bonds, debentures or
other similar instruments, (d) all Obligations of such Person created
or arising under any conditional sale or other title retention agree-
ment with respect to property acquired by such Person (even though the
rights and remedies of the seller or lender under such agreement in
the event of default are limited to repossession or sale of such
property), (e) all Obligations of such Person as lessee under Capital-
ized Leases, (f) all Obligations, contingent or otherwise, of such
Person under acceptance, letter of credit or similar facilities,
(g) all Obligations of such Person to purchase, redeem, retire,
defease or otherwise make any payment in respect of any capital stock
of or other ownership or profit interest in such Person or any other
Person or in respect of any warrants, rights or options to acquire
such capital stock, valued, in the case of Redeemable Preferred Stock,
at the greater of its voluntary or involuntary liquidation preference
plus accrued and unpaid dividends, (h) all Obligations of such Person
in respect of Hedge Agreements, (i) all Debt of others referred to in
clauses (a) through (h) above or clause (j) below guaranteed directly
or indirectly in any manner by such Person, or in effect guaranteed
directly or indirectly by such Person through an agreement (i) to pay
or purchase such Debt or to advance or supply funds for the payment or
purchase of such Debt, (ii) to purchase, sell or lease (as lessee or
lessor) property, or to purchase or sell services, primarily for the
purpose of enabling the debtor to make payment of such Debt or to
assure the holder of such Debt against loss, (iii) to supply funds to
or in any other manner invest in the debtor (including any agreement
to pay for property or services irrespective of whether such property
is received or such services are rendered) or (iv) otherwise to assure
a creditor against loss, and (j) all Debt referred to in clauses (a)
through (i) above of another Person secured by (or for which the
holder of such Debt has an existing right, contingent or otherwise, to
be secured by) any Lien on property (including, without limitation,
accounts and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such Debt.
"Default" means any Event of Default or any event that would
_______
constitute an Event of Default but for the requirement that notice be
given or time elapse or both.
"Defaulted Advance" means, with respect to any Lender at any
_________________
time, the portion of any Advance required to be made by such Lender to
the Borrower pursuant to Section 2.01 at or prior to such time which
has not been made by such Lender or by the Agent for the account of
such Lender pursuant to Section 2.02(d) as of such time. In the event
that a portion of a Defaulted Advance shall be deemed made pursuant to
Section 2.14(a), the remaining portion of such Defaulted Advance shall
be considered a Defaulted Advance originally required to be made
pursuant to Section 2.01 on the same date as the Defaulted Advance so
deemed made in part.
"Defaulted Amount" means, with respect to any Lender at any time,
________________
any amount required to be paid by such Lender to the Agent or any
other Lender hereunder or under any other Loan Document at or prior to
such time which has not been so paid as of such time, including,
without limitation, any amount required to be paid by such Lender to
(a) the Agent pursuant to Section 2.02(d) to reimburse the Agent for
the amount of any Advance made by the Agent for the account of such
Lender, (b) any other Lender pursuant to Section 2.12 to purchase any
participation in Advances owing to such other Lender and (c) the Agent
pursuant to Section 7.05 to reimburse the Agent for such Lender's
ratable share of any amount required to be paid by the Lenders to the
Agent as provided therein. In the event that a portion of a Defaulted
Amount shall be deemed paid pursuant to Section 2.14(b), the remaining
portion of such Defaulted Amount shall be considered a Defaulted
Amount originally required to be paid hereunder
<PAGE #>
or under any other Loan Document on the same date as the Defaulted
Amount so deemed paid in part.
"Defaulting Lender" means, at any time, any Lender that, at such
_________________
time, (a) owes a Defaulted Advance or a Defaulted Amount or (b) shall
take any action or be the subject of any action or proceeding of a
type described in Section 6.01(f).
"Depositary" means The Bank of New York, as depositary under the
__________
Depositary Agreement.
"Depositary Agreement" means the Depositary Agreement dated as of
____________________
July 15, 1997 between the Borrower and the Depositary.
"Documentation Agent" has the meaning specified in the recital of
___________________
parties to this Agreement.
"Domestic Lending Office" means, with respect to any Lender, the
_______________________
office of such Lender specified as its "Domestic Lending Office"
opposite its name on Schedule I hereto or in the Assignment and
Acceptance pursuant to which it became a Lender, as the case may be,
or such other office of such Lender as such Lender may from time to
time specify to the Borrower and the Agent.
"Effective Date" means the first date on which the conditions
______________
precedent set forth in Article III shall have been satisfied.
"Eligible Assignee" means (i) a Lender; (ii) an Affiliate of a
_________________
Lender; (iii) a commercial bank organized under the laws of the United
States, or any State thereof, and having total assets in excess of
$500,000,000; (iv) a savings and loan association or savings bank
organized under the laws of the United States, or any State thereof,
and having total assets in excess of $500,000,000; (v) a commercial
bank organized under the laws of any other country that is a member of
the OECD or has concluded special lending arrangements with the
International Monetary Fund associated with its General Arrangements
to Borrow, or a political subdivision of any such country, and having
total assets in excess of $500,000,000, so long as such bank is acting
through a branch or agency located in the United States; (vi) the
central bank of any country that is a member of the OECD; (vii) a
finance company, insurance company or other financial institution or
fund (whether a corporation, partnership, trust or other entity) that
is engaged in making, purchasing or otherwise investing in commercial
loans in the ordinary course of its business and having total assets
in excess of $500,000,000; and (viii) any other Person approved by the
Agent and, unless a Default has occurred and is continuing at the time
any assignment is effected in accordance with Section 8.07, the
Borrower, such approval not to be unreasonably withheld or delayed,
provided, however, that neither any Loan Party nor any Affiliate of a
________ _______
Loan Party shall qualify as an Eligible Assignee under this defini-
tion.
"Environmental Action" means any action, suit, demand, demand
____________________
letter, claim, notice of non-compliance or violation, notice of
liability or potential liability, investigation, proceeding, consent
order or consent agreement relating in any way to any Environmental
Law, any Environmental Permit or Hazardous Material or arising from
alleged injury or threat to health, safety or the environment, includ-
ing, without limitation, (a) by any governmental or regulatory author-
ity for enforcement, cleanup, removal, response, remedial or other
actions or damages and (b) by any
<PAGE #>
governmental or regulatory authority or third party for damages,
contribution, indemnification, cost recovery, compensation or injunc-
tive relief.
"Environmental Law" means any federal, state, local or foreign
_________________
statute, law, ordinance, rule, regulation, code, order, writ, judg-
ment, injunction, decree or judicial or agency interpretation, policy
or guidance relating to pollution or protection of the environment,
health, safety or natural resources, including, without limitation,
those relating to the use, handling, transportation, treatment,
storage, disposal, release or discharge of Hazardous Materials.
"Environmental Permit" means any permit, approval, identification
____________________
number, license or other authorization required under any Environmen-
tal Law.
"Equity Investor" means (i) Welsh Carson and WCAS Capital Part-
_______________
ners III, L.P., a Delaware limited partnership, and their respective
Affiliates or (ii) an individual who is a general partner or managing
member of a general partner of Welsh Carson or WCAS Capital Partners
III, L.P.
"ERISA" means the Employee Retirement Income Security Act of
_____
1974, as amended from time to time, and the regulations promulgated
and rulings issued thereunder.
"ERISA Affiliate" means any Person that for purposes of Title IV
_______________
of ERISA is a member of the controlled group of any Loan Party, or
under common control with any Loan Party, within the meaning of
Section 414 of the Internal Revenue Code.
"ERISA Event" means (a)(i) the occurrence of a reportable event,
___________
within the meaning of Section 4043 of ERISA, with respect to any Plan
unless the 30-day notice requirement with respect to such event has
been waived by the PBGC, or (ii) the requirements of subsection (1) of
Section 4043(b) of ERISA (without regard to subsection (2) of such
Section) are met with respect to a contributing sponsor, as defined in
Section 4001(a)(13) of ERISA, of a Plan, and an event described in
paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is
reasonably expected to occur with respect to such Plan within the
following 30 days; (b) the application for a minimum funding waiver
with respect to a Plan; (c) the provision by the administrator of any
Plan of a notice of intent to terminate such Plan, pursuant to Sec-
tion 4041(a)(2) of ERISA (including any such notice with respect to a
plan amendment referred to in Section 4041(e) of ERISA); (d) the
cessation of operations at a facility of any Loan Party or any ERISA
Affiliate in the circumstances described in Section 4062(e) of ERISA;
(e) the withdrawal by any Loan Party or any ERISA Affiliate from a
Multiple Employer Plan during a plan year for which it was a substan-
tial employer, as defined in Section 4001(a)(2) of ERISA; (f) the
conditions for imposition of a lien under Section 302(f) of ERISA
shall have been met with respect to any Plan; (g) the adoption of an
amendment to a Plan requiring the provision of security to such Plan
pursuant to Section 307 of ERISA; or (h) the institution by the PBGC
of proceedings to terminate a Plan pursuant to Section 4042 of ERISA,
or the occurrence of any event or condition described in Section 4042
of ERISA that constitutes grounds for the termination of, or the
appointment of a trustee to administer, such Plan.
"Eurocurrency Liabilities" has the meaning specified in Regula-
________________________
tion D of the Board of Governors of the Federal Reserve System, as in
effect from time to time.
"Eurodollar Lending Office" means, with respect to any Lender,
_________________________
the office of such Lender specified as its "Eurodollar Lending Office"
opposite its name on Schedule I hereto or in the
<PAGE #>
Assignment and Acceptance pursuant to which it became a Lender (or, if
no such office is specified, its Domestic Lending Office), or such
other office of such Lender as such Lender may from time to time
specify to the Borrower and the Agent.
"Eurodollar Rate" means, for any Interest Period for all Eurodol-
_______________
lar Rate Advances comprising part of the same Borrowing, an interest
rate per annum equal to the rate per annum obtained by dividing
(a) the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Telerate Page 3750 (or any successor page)
as the London interbank offered rate for deposits in U.S. dollars at
11:00 A.M. (London time) two Business Days before the first day of
such Interest Period in an amount substantially equal to NationsBank's
Eurodollar Rate Advance comprising part of such Borrowing to be
outstanding during such Interest Period (or, if NationsBank shall not
have such a Eurodollar Rate Advance, $1,000,000) and for a period
equal to such Interest Period (provided that if for any reason such
________
rate is not available, the term "Eurodollar Rate" shall mean, for any
Interest Period for all Eurodollar Rate Advances comprising part of
the same Borrowing, the rate per annum (rounded upwards, if necessary,
to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as
the London interbank offered rate for deposits in Dollars at approxi-
mately 11:00 A.M. (London time) two Business Days prior to the first
day of such Interest Period for a term comparable to such Interest
Period; provided, however, if more than one rate is specified on
________ _______
Reuters Screen LIBO Page, the applicable rate shall be the arithmetic
mean of all such rates) by (b) a percentage equal to 100% minus the
Eurodollar Rate Reserve Percentage for such Interest Period.
"Eurodollar Rate Advance" means an Advance that bears interest as
_______________________
provided in Section 2.06(a)(ii).
"Eurodollar Rate Reserve Percentage" for any Interest Period for
__________________________________
all Eurodollar Rate Advances comprising part of the same Borrowing
means the reserve percentage applicable two Business Days before the
first day of such Interest Period under regulations issued from time
to time by the Board of Governors of the Federal Reserve System (or
any successor) for determining the maximum reserve requirement (in-
cluding, without limitation, any emergency, supplemental or other
marginal reserve requirement) for a member bank of the Federal Reserve
System in New York City with respect to liabilities or assets consist-
ing of or including Eurocurrency Liabilities (or with respect to any
other category of liabilities that includes deposits by reference to
which the interest rate on Eurodollar Rate Advances is determined)
having a term equal to such Interest Period.
"Events of Default" has the meaning specified in Section 6.01.
_________________
"Existing Debt" means Debt of the Company and its Subsidiaries
_____________
outstanding immediately before giving effect to the consummation of
the Tender Offer.
"Extraordinary Receipt" means any cash received by or paid to or
_____________________
for the account of any Person not in the ordinary course of business,
including, without limitation, tax refunds, pension plan reversions,
proceeds of insurance (other than proceeds of business interruption
insurance to the extent such proceeds constitute compensation for lost
earnings), condemnation awards (and payments in lieu thereof) and
indemnity payments.
"Facility" means the Term A Facility or the Term B Facility.
________
"Federal Funds Rate" means, for any period, a fluctuating inter-
__________________
est rate per annum equal for each day during such period to the
weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as
<PAGE #>
published for such day (or, if such day is not a Business Day, for the
next preceding Business Day) by the Federal Reserve Bank of New York,
or, if such rate is not so published for any day that is a Business
Day, the average of the quotations for such day for such transactions
received by the Agent from three Federal funds brokers of recognized
standing selected by it.
"Fiscal Year" means a fiscal year of the Borrower and its Consol-
___________
idated Subsidiaries ending on December 31 in any calendar year.
"GAAP" has the meaning specified in Section 1.03.
____
"Guarantor" means Holdings and Welsh Carson.
_________
"Guaranties" means the Holdings Guaranty and the Welsh Carson
__________
Guaranty.
"Hazardous Materials" means (a) petroleum or petroleum products,
___________________
by-products or breakdown products, radioactive materials, asbestos-
containing materials, polychlorinated biphenyls and radon gas and
(b) any other chemicals, materials or substances designated, classi-
fied or regulated as hazardous or toxic or as a pollutant or contami-
nant under any Environmental Law.
"Hedge Agreements" means interest rate swap, cap or collar
________________
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other similar
agreements.
"Holdings" has the meaning specified in the Preliminary State-
________
ments.
"Holdings Guaranty" has the meaning specified in Section
_________________
3.01(m)(xi).
"Holdings Pledge Agreement" has the meaning specified in Section
_________________________
3.01(m)(ix).
"Indemnified Party" has the meaning specified in Section 8.04(b).
_________________
"Initial Extension of Credit" means the occurrence of the initial
___________________________
Borrowing hereunder.
"Initial Lenders" has the meaning specified in the recital of
_______________
parties to this Agreement.
"Insufficiency" means, with respect to any Plan, the amount, if
_____________
any, of its unfunded benefit liabilities, as defined in Section 4001(a)(18)
of ERISA.
"Interest Period" means, for each Eurodollar Rate Advance com-
_______________
prising part of the same Borrowing, the period commencing on the date
of such Eurodollar Rate Advance or the date of the Conversion of any
Prime Rate Advance into such Eurodollar Rate Advance, and ending on
the last day of the period selected by the Borrower pursuant to the
provisions below and, thereafter, each subsequent period commencing on
the last day of the immediately preceding Interest Period and ending
on the last day of the period selected by the Borrower pursuant to the
provisions below. The duration of each such Interest Period shall be
one, two or three months (or such other period as each Lender and the
Borrower may agree), as the Borrower may, upon notice received by the
Agent not later than 10:00 A.M. (Dallas, Texas time)) on the third
Business Day prior to the first day of such Interest Period, select;
provided, however, that:
________ _______
<PAGE #>
(a) the Borrower may not select any Interest Period with
respect to any Eurodollar Rate Advance under a Facility that ends
after any principal repayment installment date for such Facility
unless, after giving effect to such selection, the aggregate
principal amount of Prime Rate Advances and of Eurodollar Rate
Advances having Interest Periods that end on or prior to such
principal repayment installment date for such Facility shall be
at least equal to the aggregate principal amount of Advances
under such Facility due and payable on or prior to such date;
(b) Interest Periods commencing on the same date for
Eurodollar Rate Advances comprising part of the same Borrowing
shall be of the same duration;
(c) whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day, the last day
of such Interest Period shall be extended to occur on the next
succeeding Business Day, provided, however, that, if such exten-
________ _______
sion would cause the last day of such Interest Period to occur in
the next following calendar month, the last day of such Interest
Period shall occur on the next preceding Business Day; and
(d) whenever the first day of any Interest Period occurs on
a day of an initial calendar month for which there is no numeri-
cally corresponding day in the calendar month that succeeds such
initial calendar month by the number of months equal to the
number of months in such Interest Period, such Interest Period
shall end on the last Business Day of such succeeding calendar
month.
"Internal Revenue Code" means the Internal Revenue Code of 1986,
_____________________
as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"Investment" in any Person means any loan or advance to such
__________
Person, any purchase or other acquisition of any capital stock or
other ownership or profit interest, warrants, rights, options, obliga-
tions or other securities of such Person, any capital contribution to
such Person or any other investment in such Person, including, without
limitation, any arrangement pursuant to which the investor incurs Debt
of the types referred to in clause (i) or (j) of the definition of
"Debt" in respect of such Person.
____
"Lenders" means the Initial Lenders and each Person that shall
_______
become a Lender hereunder pursuant to Section 8.07.
"Lien" means any lien, security interest or other charge or
____
encumbrance of any kind, or any other type of preferential arrange-
ment, including, without limitation, the lien or retained security
title of a conditional vendor and any easement, right of way or other
encumbrance on title to real property.
"Loan Documents" means (a) for purposes of this Agreement and the
______________
Notes and any amendment, supplement or modification hereof or thereof
and for all other purposes other than for purposes of the Guaranties
and the Collateral Documents, (i) this Agreement, (ii) the Notes,
(iii) the Guaranties and (iv) the Collateral Documents, (b) for
purposes of the Holdings Guaranty and the Collateral Documents (other
than the Borrower Pledge Agreement), (i) this Agreement, (ii) the
Notes, (iii) the Guaranties, and (iv) the Collateral Documents (other
than the Pledge Agreement), (c) for purposes of the Welsh Carson
Guaranty, (i) this Agreement, (ii) the Term A Notes and (iii) the
Welsh Carson Guaranty and (d) for purposes of the Borrower Pledge
<PAGE #>
Agreement, (i) this Agreement, (ii) the Term B Notes and (iii) the
Borrower Pledge Agreement, in each case as amended, supplemented or
otherwise modified from time to time.
"Loan Parties" means the Company, the Borrower and the Guaran-
____________
tors.
"Margin Stock" has the meaning specified in Regulation U.
____________
"Material Adverse Change" means any material adverse change in
_______________________
the business, condition (financial or otherwise), operations, perfor-
mance, properties or prospects of each of Holdings, the Borrower and
the Company either individually or together with its Subsidiaries,
taken as a whole.
"Material Adverse Effect" means a material adverse effect on
_______________________
(a) the business, condition (financial or otherwise), operations,
performance, properties or prospects of each of Holdings, the Borrower
or the Company, either individually or together with its Subsidiaries
taken as a whole, (b) the rights and remedies of the Agent or any
Lender under any Loan Document or Related Document or (c) the ability
of any Loan Party to perform its Obligations under any Loan Document
or Related Document to which it is or is to be a party.
"Merger" has the meaning specified in the Preliminary Statements.
______
"Merger Agreement" has the meaning specified in the Preliminary
________________
Statements.
"Merger Facilities" means a senior secured credit agreement to be
_________________
entered into by the Borrower and one or more banks or other financial
institutions providing for advances to be made upon or after the
consummation of the Merger in order to refinance borrowings under this
Agreement, pay to the holders of the Company Stock (other than the
Borrower) the cash consideration for their shares in the Merger, pay
transaction fees and expenses, refinance certain Existing Debt of the
Company and pay related transaction fees and expenses and provide
ongoing financing for the Company and its Subsidiaries.
"Multiemployer Plan" means a multiemployer plan, as defined in
__________________
Section 4001(a)(3) of ERISA, to which any Loan Party or any ERISA
Affiliate is making or accruing an obligation to make contributions,
or has within any of the preceding five plan years made or accrued an
obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as defined
______________________
in Section 4001(a)(15) of ERISA, that (a) is maintained for employees
of any Loan Party or any ERISA Affiliate and at least one Person other
than the Loan Parties and the ERISA Affiliates or (b) was so main-
tained and in respect of which any Loan Party or any ERISA Affiliate
could have liability under Section 4064 or 4069 of ERISA in the event
such plan has been or were to be terminated.
"NationsBank" has the meaning specified in the recital of parties
___________
to this Agreement.
"Net Cash Proceeds" means, with respect to any sale, lease,
_________________
transfer or other disposition of any asset or the sale or issuance of
any Debt or capital stock or other ownership or profit interest, any
securities convertible into or exchangeable for capital stock or other
ownership or profit interest or any warrants, rights, options or other
securities to acquire capital stock or other ownership or profit
interest by any Person, or any Extraordinary Receipt received by or
paid to or for the account of any Person, the aggregate amount of cash
received from time to time (whether as initial consideration or
through payment or disposition of deferred consideration) by or on
<PAGE #>
behalf of such Person in connection with such transaction after
deducting therefrom only (without duplication) (a) reasonable and
customary brokerage commissions, underwriting fees and discounts,
legal fees, finder's fees and other similar fees and commissions and
(b) the amount of taxes payable in connection with or as a result of
such transaction and (c) the amount of any Debt secured by a Lien on
such asset that, by the terms of the agreement or instrument governing
such Debt, is required to be repaid upon such disposition, in each
case to the extent, but only to the extent, that the amounts so
deducted are, at the time of receipt of such cash, actually paid to a
Person that is not an Affiliate of such Person or any Loan Party or
any Affiliate of any Loan Party and are properly attributable to such
transaction or to the asset that is the subject thereof.
"Note" means a Term A Note or a Term B Note.
____
"Notice of Borrowing" has the meaning specified in
___________________
Section 2.02(a).
"NPL" means the National Priorities List under CERCLA.
___
"Obligation" means, with respect to any Person, any payment,
__________
performance or other obligation of such Person of any kind, including,
without limitation, any liability of such Person on any claim, whether
or not the right of any creditor to payment in respect of such claim
is reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, disputed, undisputed, legal, equitable, secured or unsecured,
and whether or not such claim is discharged, stayed or otherwise
affected by any proceeding referred to in Section 6.01(f). Without
limiting the generality of the foregoing, the Obligations of the Loan
Parties under the Loan Documents include (a) the obligation to pay
principal, interest, charges, expenses, fees, attorneys' fees and
disbursements, indemnities and other amounts payable by any Loan Party
under any Loan Document and (b) the obligation of any Loan Party to
reimburse any amount in respect of any of the foregoing that any
Lender, in its sole discretion, may elect to pay or advance on behalf
of such Loan Party.
"OECD" means the Organization for Economic Cooperation and
____
Development.
"Offer to Purchase" has the meaning specified in the Preliminary
_________________
Statements.
"Open Year" has the meaning specified in Section 4.01(aa).
_________
"Other Taxes" has the meaning specified in Section 2.11(b).
___________
"PBGC" means the Pension Benefit Guaranty Corporation (or any
____
successor).
"Permitted Liens" means such of the following as to which no
_______________
enforcement, collection, execution, levy or foreclosure proceeding
shall have been commenced: (a) Liens for taxes, assessments and
governmental charges or levies to the extent not required to be paid
under Section 5.01(b) hereof; (b) Liens imposed by law, such as
materialmen's, mechanics', carriers', workmen's and repairmen's Liens
and other similar Liens arising in the ordinary course of business
securing obligations that are not overdue for a period of more than 30
days; (c) pledges or deposits to secure obligations under workers'
compensation laws or similar legislation or to secure public or
statutory obligations; and (d) easements, rights of way and other
encumbrances on title to real property that do not render title to the
property encumbered thereby unmarketable or materially adversely
affect the use of such property for its present purposes.
<PAGE #>
"Person" means an individual, partnership, corporation (including
______
a business trust), limited liability company, joint stock company,
trust, unincorporated association, joint venture or other entity, or a
government or any political subdivision or agency thereof.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
____
"Pledged Debt" has the meaning specified in the Holdings Pledge
____________
Agreement.
"Pledged Shares" has the meaning specified in the Borrower Pledge
______________
Agreement and the Holdings Pledge Agreement.
"Pre-Commitment Information" has the meaning specified in Section
__________________________
3.01(k).
"Preferred Stock" means, with respect to any corporation, capital
_______________
stock issued by such corporation that is entitled to a preference or
priority over any other capital stock issued by such corporation upon
any distribution of such corporation's assets, whether by dividend or
upon liquidation.
"Prime Rate" means a fluctuating interest rate per annum in
__________
effect from time to time, which rate per annum shall at all times be
equal to the higher of:
(a) the rate of interest announced publicly by NationsBank,
N.A. in Charlotte, North Carolina, from time to time, as
NationsBank's prime rate;
(b) 1/2 of one percent per annum above the Federal Funds
Rate.
"Prime Rate Advance" means an Advance that bears interest as
__________________
provided in Section 2.06(a)(i).
"Redeemable" means, with respect to any capital stock or other
__________
ownership or profit interest, Debt or other right or Obligation, any
such right or Obligation that (a) the issuer has undertaken to redeem
at a fixed or determinable date or dates, whether by operation of a
sinking fund or otherwise, or upon the occurrence of a condition not
solely within the control of the issuer or (b) is redeemable at the
option of the holder.
"Register" has the meaning specified in Section 8.07(d).
________
"Regulation U" means Regulation U of the Board of Governors of
____________
the Federal Reserve System, as in effect from time to time.
"Related Documents" means the Offer to Purchase, the Merger
_________________
Agreement, the Subordinated Debt Documents, the Depositary Agreement,
all agreements or instruments evidencing Pledged Debt and the Securi-
ties Purchase Agreement and the Subscription Agreement.
"Required Lenders" means at any time Lenders owed or holding at
________________
least 66-2/3% of the aggregate principal amount of the Advances
outstanding at such time or, if no such principal amount is outstand-
ing at such time, Lenders holding at least 66-2/3% of the aggregate of
the Term A Commitments and Term B Commitments; provided, however, that
________ _______
if any Lender shall be a Defaulting Lender at such time, there shall
be excluded from the determination of Required Lenders at such time
the aggregate principal amount of the Advances owing to such Lender
and
<PAGE #>
outstanding at such time, or, if applicable, the aggregate unused
Term A and Term B Commitments of such Lender at such time.
"Responsible Officer" means any officer of any Loan Party or any
___________________
of its Subsidiaries.
"Secured Parties" means the Agent and the Lenders.
_______________
"Securities Purchase Agreement" means the Securities Purchase
_____________________________
Agreement, dated as of August 11, 1997, among Holdings, Welsh Carson,
WCAS Capital Partners III, L.P., WCAS Information Partners, L.P. and
the other parties listed on Schedule I thereto.
"Security Agreement" has the meaning specified in Section
__________________
3.01(m)(ix).
"Set-Aside Amount" has the meaning specified in Section 2.01(c).
________________
"Single Employer Plan" means a single employer plan, as defined
____________________
in Section 4001(a)(15) of ERISA, that (a) is maintained for employees
of any Loan Party or any ERISA Affiliate and no Person other than the
Loan Parties and the ERISA Affiliates or (b) was so maintained and in
respect of which any Loan Party or any ERISA Affiliate could have
liability under Section 4069 of ERISA in the event such plan has been
or were to be terminated.
"Solvent" and "Solvency" mean, with respect to any Person on a
_______ ________
particular date, that on such date (a) the fair value of the property
of such Person is greater than the total amount of liabilities,
including, without limitation, contingent liabilities, of such Person,
(b) the present fair salable value of the assets of such Person is not
less than the amount that will be required to pay the probable liabil-
ity of such Person on its debts as they become absolute and matured,
(c) such Person does not intend to, and does not believe that it will,
incur debts or liabilities beyond such Person's ability to pay such
debts and liabilities as they mature and (d) such Person is not
engaged in business or a transaction, and is not about to engage in
business or a transaction, for which such Person's property would
constitute an unreasonably small capital. The amount of contingent
liabilities at any time shall be computed as the amount that, in the
light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an
actual or matured liability.
"Subordinated Debt" means any Debt of the Borrower that is
_________________
subordinated to the Obligations of the Borrower under the Loan Docu-
ments on, and that otherwise contains, terms and conditions satisfac-
tory to the Required Lenders.
"Subordinated Debt Documents" means all agreements, indentures
___________________________
and instruments pursuant to which Subordinated Debt is issued.
"Subsidiary" of any Person means any corporation, partnership,
__________
joint venture, limited liability company, trust or estate of which (or
in which) more than 50% of (a) the issued and outstanding capital
stock having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether at the time
capital stock of any other class or classes of such corporation shall
or might have voting power upon the occurrence of any contingency),
(b) the interest in the capital or profits of such partnership, joint
venture or limited liability company or (c) the beneficial interest in
such trust or estate is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person's other Subsidiaries.
<PAGE #>
"Subscription Agreement" means the Subscription Agreement, dated
______________________
August 12, 1997, between Holdings and the Borrower.
"Surviving Corporation" has the meaning specified in the Prelimi-
_____________________
nary Statements.
"Tax Certificate" has the meaning specified in Section 5.03(n).
_______________
"Taxes" has the meaning specified in Section 2.11(a).
_____
"Tender Offer" has the meaning specified in the Preliminary
____________
Statements.
"Term A Advance" has the meaning specified in Section 2.01(a).
______________
"Term A Borrowing" means a borrowing consisting of simultaneous
________________
Term A Advances of the same Type made by the Lenders.
"Term A Commitment" means, with respect to any Lender at any
_________________
time, the amount set forth opposite such Lender's name on Schedule I
hereto under the caption "Term A Commitment" or, if such Lender has
entered into one or more Assignments and Acceptances, set forth for
such Lender in the Register maintained by the Agent pursuant to
Section 8.07(d) as such Lender's "Term A Commitment", as such amount
may be reduced at or prior to such time pursuant to Section 2.04.
"Term A Facility" means, at any time, the aggregate amount of the
_______________
Lenders' Term A Commitments at such time.
"Term A Note" means a promissory note of the Borrower payable to
___________
the order of any Lender, in substantially the form of Exhibit A-1
hereto, evidencing the indebtedness of the Borrower to such Lender
resulting from the Term A Advance made by such Lender, as amended,
supplemented or otherwise modified from time to time.
"Term B Advance" has the meaning specified in Section 2.01(b).
______________
"Term B Borrowing" means a borrowing consisting of simultaneous
________________
Term B Advances of the same Type made by the Lenders.
"Term B Commitment" means, with respect to any Lender at any
_________________
time, the amount set forth opposite such Lender's name on Schedule I
hereto under the caption "Term B Commitment" or, if such Lender has
entered into one or more Assignments and Acceptances, set forth for
such Lender in the Register maintained by the Agent pursuant to
Section 8.07(d) as such Lender's "Term B Commitment", as such amount
may be reduced at or prior to such time pursuant to Section 2.04.
"Term B Facility" means, at any time, the aggregate amount of the
_______________
Lenders' Term B Commitments at such time.
"Term B Note" means a promissory note of the Borrower payable to
___________
the order of any Lender, in substantially the form of Exhibit A-2
hereto, evidencing the indebtedness of the Borrower to such Lender
resulting from the Term B Advance made by such Lender, as amended,
supplemented or otherwise modified from time to time.
<PAGE #>
"Termination Date" means (a) with respect to the Term A Facility,
________________
the earlier of February 12, 1998 and the date of termination in whole
of the Term A Commitments pursuant to Section 2.04 or 6.01 and
(b) with respect to the Term B Facility, the earliest of February 12,
1998, the date of consummation of the Merger and the date of termina-
tion in whole of the Term B Commitments pursuant to Section 2.04 or
6.01.
"Type" refers to the distinction between Term A Advances bearing
____
interest at the Prime Rate and Advances bearing interest at the
Eurodollar Rate.
"Voting Stock" means capital stock issued by a corporation, or
____________
equivalent interests in any other Person, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of
such Person, even if the right so to vote has been suspended by the
happening of such a contingency.
"Welsh Carson" means Welsh, Carson, Anderson & Stowe VII, L.P., a
____________
Delaware limited partnership.
"Welsh Carson Guaranty" has the meaning specified in Section
_____________________
3.01(m)(xii).
"Welfare Plan" means a welfare plan, as defined in Section 3(1)
____________
of ERISA, that is maintained for employees of any Loan Party or in
respect of which any Loan Party could have liability.
"Withdrawal Liability" has the meaning specified in Part I of
____________________
Subtitle E of Title IV of ERISA.
SECTION 1.02. Computation of Time Periods. In this Agreement in
___________________________
the computation of periods of time from a specified date to a later
specified date, the word "from" means "from and including" and the words
"to" and "until" each mean "to but excluding".
SECTION 1.03. Accounting Terms. All accounting terms not
________________
specifically defined herein shall be construed in accordance with generally
accepted accounting principles consistent with those applied in the
preparation of the financial statements referred to in Section 4.01(f)
("GAAP").
____
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The Advances. (a) The Term A Advances. Each
____________ ___________________
Lender severally agrees, on the terms and conditions hereinafter set forth,
to make advances (each a "Term A Advance") to the Borrower on any Business
______________
Day during the period from the Effective Date hereof until the Termination
Date in an amount not to exceed such Lender's unused Term A Commitment at
such time. Each Term A Borrowing shall be in an aggregate amount of
$2,000,000 or an integral multiple of $1,000,000 in excess thereof and
shall consist of Term A Advances made simultaneously by the Lenders ratably
according to their Term A Commitments. Amounts borrowed under this
Section 2.01(a) and repaid or prepaid may not be reborrowed.
(b) The Term B Advances. Each Lender severally agrees, on the
___________________
terms and conditions hereinafter set forth, to make advances (each a "Term
____
B Advance") to the Borrower on any
_________
<PAGE #>
Business Day during the period from the Effective Date hereof until the
date that is 10 days after the Effective Date, in an amount not to exceed
the lesser of (i) such Lender's unused Term B Commitment at such time and
(ii) such Lenders pro rata share of the maximum loan value (as defined in
Regulation U) of the Pledged Shares. Each Term B Borrowing shall be in an
aggregate amount of $2,000,000 or an integral multiple of $1,000,000 in
excess thereof and shall consist of Term B Advances made simultaneously by
the Lenders ratably according to their Term B Commitments. Amounts
borrowed under this Section 2.01(b) and repaid or prepaid may not be
reborrowed.
(c) Set Aside of Term A Commitments. (i) So long as the Merger
_______________________________
shall not have been consummated, the Term A Lenders' unused Term A Commit-
ments shall be reserved in an aggregate amount equal to $9,000,000, ratably
as to each such Lender in accordance with its Term A Commitment, and shall
be available to be borrowed solely to fund the payment of interest on the
Advances hereunder. The amount of Term A Commitments so reserved at any
time pursuant to this Section 2.01(c) is referred to herein as the "Set-
____
Aside Amount".
____________
SECTION 2.02. Making the Advances. (a) Each Borrowing other
___________________
than the Initial Extension of Credit shall be made on notice, given not
later than 10:00 A.M. (Dallas, Texas time) on the third Business Day prior
to the date of the proposed Borrowing, by the Borrower to the Agent, which
shall give to each Lender prompt notice thereof by telex or telecopier.
The Initial Extension of Credit shall be made on August 12, 1997 before
10:00 A.M. if notice is given on or before 9:00 A.M. (Dallas, Texas time)
on August 12, 1997 and shall consist of Prime Rate Advances. Each such
notice of a Borrowing (a "Notice of Borrowing") shall be by telephone,
___________________
confirmed immediately in writing, or telex or telecopier, in substantially
the form of Exhibit B hereto, specifying therein the requested (i) date of
such Borrowing, (ii) Facility under which such Borrowing is to be made,
(iii) Type of Advances comprising such Borrowing, (iv) aggregate amount of
such Borrowing and (v) in the case of a Borrowing consisting of Eurodollar
Rate Advances, initial Interest Period for each such Advance. Each Lender
shall, before 10:00 A.M. (Dallas, Texas time) on the date of such Borrow-
ing, make available for the account of its Applicable Lending Office to the
Agent at the Agent's Account, in same day funds, such Lender's ratable
portion of such Borrowing in accordance with the respective Commitments
under the applicable Facility of such Lender and the other Lenders. After
the Agent's receipt of such funds and upon fulfillment of the applicable
conditions set forth in Article III, the Agent will make such funds
available to the Borrower by crediting the Borrower's Account.
(b) Anything in subsection (a) above to the contrary notwith-
standing, (i) the Borrower may not select Eurodollar Rate Advances for the
initial Borrowing hereunder or for any Borrowing if the aggregate amount of
such Borrowing is less than $2,000,000 or if the obligation of the Lenders
to make Eurodollar Rate Advances shall then be suspended pursuant to
Section 2.08 or Section 2.09 and (ii) the Term A Advances may not be
outstanding as part of more than five separate Borrowings and the Term B
Advances may not be outstanding as part of more than two separate
Borrowings.
(c) Each Notice of Borrowing shall be irrevocable and binding on
the Borrower. In the case of any Borrowing that the related Notice of
Borrowing specifies is to be comprised of Eurodollar Rate Advances, the
Borrower shall indemnify each Lender against any loss, cost or expense
incurred by such Lender as a result of any failure to fulfill on or before
the date specified in such Notice of Borrowing for such Borrowing the
applicable conditions set forth in Article III, including, without limita-
tion, any loss (including loss of anticipated profits), cost or expense
incurred by reason of the liquidation or reemployment of deposits or other
funds acquired by such Lender to fund the Advance to be made by such Lender
as part of such Borrowing when such Advance, as a result of such failure,
is not made on such date.
<PAGE #>
(d) Unless the Agent shall have received notice from a Lender
prior to the date of any Borrowing that such Lender will not make available
to the Agent such Lender's ratable portion of such Borrowing, the Agent may
assume that such Lender has made such portion available to the Agent on the
date of such Borrowing in accordance with subsection (a) or (b) of this
Section 2.02 and the Agent may, in reliance upon such assumption, make
available to the Borrower on such date a corresponding amount. If and to
the extent that such Lender shall not have so made such ratable portion
available to the Agent, such Lender and the Borrower severally agree to
repay or pay to the Agent forthwith on demand such corresponding amount and
to pay interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid or paid to
the Agent, at (i) in the case of the Borrower, the interest rate applicable
at such time under Section 2.06 to Advances comprising such Borrowing and
(ii) in the case of such Lender, the Federal Funds Rate. If such Lender
shall pay to the Agent such corresponding amount, such amount so paid shall
constitute such Lender's Advance as part of such Borrowing for all purpos-
es.
(e) The failure of any Lender to make the Advance to be made by
it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its Advance on the date of such
Borrowing, but no Lender shall be responsible for the failure of any other
Lender to make the Advance to be made by such other Lender on the date of
any Borrowing.
SECTION 2.03. Repayment of Advances. (a) Term A Advances. The
_____________________ _______________
Borrower shall repay to the Agent for the ratable account of the Lenders
the aggregate outstanding principal amount of the Term A Advances on the
Termination Date (which amount shall be reduced as a result of the applica-
tion of prepayments in accordance with the order of priority set forth in
Section 2.05).
(b) Term B Advances. The Borrower shall repay to the Agent for
_______________
the ratable account of the Lenders the aggregate outstanding principal
amount of the Term B Advances on the Termination Date (which amounts shall
be reduced as a result of the application of prepayments in accordance with
the order of priority set forth in Section 2.05).
SECTION 2.04. Termination or Reduction of the Commitments. (a)
___________________________________________
Optional. The Borrower may, upon at least five Business Days' notice to
________
the Agent, terminate in whole or reduce in part the unused portions of the
Term A Commitments and the Term B Commitments; provided, however, that each
________ _______
partial reduction of a Facility (i) shall be in an aggregate amount of
$5,000,000 or an integral multiple of $1,000,000 in excess thereof,
(ii) shall be made ratably among the Lenders in accordance with their
Commitments with respect to such Facility and (iii) in no event shall the
Term A Commitments be reduced to an amount less than the Set-Aside Amount
then in effect.
(b) Mandatory. (i) From time to time upon each repayment or
_________
prepayment of the Term A Advances, the aggregate Term A Commitments of the
Lenders shall be automatically and permanently reduced, on a pro rata
basis, by an amount equal to the amount by which the aggregate Term A
Commitments immediately prior to such reduction exceed the aggregate unpaid
principal amount of the Term A Advances then outstanding.
(ii) From time to time upon each repayment or prepayment of the
Term B Advances, the aggregate Term B Commitments of the Lenders shall be
automatically and permanently reduced, on a pro rata basis, by an amount
equal to the amount by which the aggregate Term B Commitments immediately
prior to such reduction exceed the aggregate unpaid principal amount of the
Term B Advances then outstanding.
<PAGE #>
SECTION 2.05. Prepayments. (a) Optional. The Borrower may,
___________ ________
upon at least five Business Days' notice to the Agent stating the proposed
date and aggregate principal amount of the prepayment, and if such notice
is given the Borrower shall, prepay the outstanding aggregate principal
amount of the Advances comprising part of the same Borrowing in whole or
ratably in part, together with accrued interest to the date of such
prepayment on the aggregate principal amount prepaid; provided, however,
________ _______
that (x) each partial prepayment shall be in an aggregate principal amount
of $2,000,000 or an integral multiple of $1,000,000 in excess thereof and
(y) if any prepayment of a Eurodollar Rate Advance is made on a date other
than the last day of an Interest Period for such Advance the Borrower shall
also pay any amounts owing pursuant to Section 8.04(c). Each such prepay-
ment of the Advances shall be applied first to the Term B Advances and
_____
second to the Term A Advances.
______
(b) Mandatory. (i) The Borrower shall, on the date of receipt
_________
of the Net Cash Proceeds by Holdings or the Borrower or any of its Subsid-
iaries from (A) the sale, lease, transfer or other disposition of any
assets of Holdings or the Borrower or any of their respective Subsidiaries
(other than any sale, lease, transfer or other disposition of assets
pursuant to clause (i) of Section 5.02(d)), (B) the incurrence or issuance
by Holdings or the Borrower or any of their respective Subsidiaries of any
Debt (other than Debt incurred or issued pursuant to clause (i), (ii),
(iii) (but only until the fifth Business Day after receipt thereof) or
(iv)) of Section 5.02(b), (C) the sale or issuance by Holdings or the
Borrower or any of their respective Subsidiaries of any capital stock or
other ownership or profit interest, any securities convertible into or
exchangeable for capital stock or other ownership or profit interest or any
warrants, rights or options to acquire capital stock or other ownership or
profit interest and (D) any Extraordinary Receipt received by or paid to or
for the account of Holdings or the Borrower or any of their respective
Subsidiaries and not otherwise included in clause (A), (B) or (C) above,
prepay an aggregate principal amount of the Advances comprising part of the
same Borrowings equal to the amount of such Net Cash Proceeds. Each such
prepayment shall be applied first to the Term B Facility and second to the
_____ ______
Term A Facility; provided, however, that notwithstanding such application,
________ _______
if any prepayment of Debt of the type described in clause (iii) of Section
5.02(b) is required to be made prior to the Merger, then either (1) no such
prepayment will be made and the Net Cash Proceeds of such Debt shall be
applied to cash collateralize the Term A Facility or (2) such payment may
be made if substitute collateral, in form reasonably acceptable to the
Agent, for the Term A Facility is provided.
(ii) All prepayments under this subsection (b) shall be made
together with accrued interest to the date of such prepayment on the
principal amount prepaid.
SECTION 2.06. Interest. (a) Scheduled Interest. The Borrower
________ __________________
shall pay interest on the unpaid principal amount of each Advance owing to
each Lender from the date of such Advance until such principal amount shall
be paid in full, at the following rates per annum:
(i) Prime Rate Advances. For each Term B Advance, and during
___________________
such periods as any Term A Advance shall be a Prime Rate Advance, a
rate per annum equal at all times to the sum of (A) the Prime Rate in
effect from time to time plus (B) the Applicable Margin in effect from
____
time to time, payable in arrears monthly on the day of each month
during such periods and on the date such Prime Rate Advance shall be
Converted (in the case of a Term A Advance) or paid in full.
(ii) Eurodollar Rate Advances. During such periods as any Term A
________________________
Advance shall be a Eurodollar Rate Advance, a rate per annum equal at
all times during each Interest Period for such Advance to the sum of
(A) the Eurodollar Rate for such Interest Period for such Advance plus
____
(B) the Applicable Margin in effect from time to time, payable in
arrears on the last day of
<PAGE #>
such Interest Period and on the date such Eurodollar Rate Advance
shall be Converted or paid in full.
(b) Default Interest. Upon the occurrence and during the
________________
continuance of an Event of Default, the Borrower shall pay interest on
(i) the unpaid principal amount of each Advance owing to each Lender,
payable in arrears on the dates referred to in clause (a)(i) or (a)(ii)
above and on demand, at a rate per annum equal at all times to 2% per annum
above the rate per annum required to be paid on such Advance pursuant to
clause (a)(i) or (a)(ii) above and (ii) to the fullest extent permitted by
law, the amount of any interest, fee or other amount payable hereunder that
is not paid when due, from the date such amount shall be due until such
amount shall be paid in full, payable in arrears on the date such amount
shall be paid in full and on demand, at a rate per annum equal at all times
to 2% per annum above the rate per annum required to be paid, in the case
of interest, on the Type of Advance on which such interest has accrued
pursuant to clause (a)(i) or (a)(ii) above, and, in all other cases, on
Prime Rate Advances pursuant to clause (a)(i) above.
(c) Notice of Interest Rate. Promptly after receipt of a Notice
_______________________
of Borrowing pursuant to Section 2.02(a), the Agent shall give notice to
the Borrower and each Lender of the applicable interest rate determined by
the Agent for purposes of clause (a)(i) or (ii).
SECTION 2.07. Agent's Fees. The Borrower shall pay to the Agent
____________
for its own account such fees as may from time to time be agreed between
the Borrower and the Agent.
SECTION 2.08. Conversion of Advances. (a) Optional. The
______________________ ________
Borrower may on any Business Day, upon notice given to the Agent not later
than 10:00 A.M. (Dallas, Texas time) on the third Business Day prior to the
date of the proposed Conversion and subject to the provisions of Sec-
tions 2.06 and 2.09, Convert all or any portion of the Term A Advances of
one Type comprising the same Borrowing into Advances of the other Type;
provided, however, that any Conversion of Eurodollar Rate Advances into
________ _______
Prime Rate Advances shall be made only on the last day of an Interest
Period for such Eurodollar Rate Advances, any Conversion of Prime Rate
Advances into Eurodollar Rate Advances shall be in an amount not less than
the minimum amount specified in Section 2.02(b), no Conversion of any
Advances shall result in more separate Borrowings than permitted under
Section 2.02(b) and each Conversion of Advances comprising part of the same
Borrowing under any Facility shall be made ratably among the Lenders in
accordance with their Commitments under such Facility. Each such notice of
Conversion shall, within the restrictions specified above, specify (i) the
date of such Conversion, (ii) the Advances to be Converted and (iii) if
such Conversion is into Eurodollar Rate Advances, the duration of the
initial Interest Period for such Advances. Each notice of Conversion shall
be irrevocable and binding on the Borrower.
(b) Mandatory. (i) On the date on which the aggregate unpaid
_________
principal amount of Eurodollar Rate Advances comprising any Borrowing shall
be reduced, by payment or prepayment or otherwise, to less than
$[2,000,000], such Advances shall automatically Convert into Prime Rate
Advances.
(ii) If the Borrower shall fail to select the duration of any
Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "Interest Period" in
Section 1.01, the Agent will forthwith so notify the Borrower and the
Lenders, whereupon each such Eurodollar Rate Advance will automatically, on
the last day of the then existing Interest Period therefor, Convert into a
Prime Rate Advance.
(iii) Upon the occurrence and during the continuance of any
Default, (x) each Eurodollar Rate Advance will automatically, on the last
day of the then existing Interest Period therefor,
<PAGE #>
Convert into a Prime Rate Advance and (y) the obligation of the Lenders to
make, or to Convert Advances into, Eurodollar Rate Advances shall be
suspended.
SECTION 2.09. Increased Costs, Etc. (a) If, due to either
____________________
(i) the introduction of or any change in or in the interpretation of any
law or regulation or (ii) the compliance with any guideline or request from
any central bank or other governmental authority (whether or not having the
force of law), there shall be any increase in the cost to any Lender of
agreeing to make or of making, funding or maintaining Eurodollar Rate
Advances (excluding for purposes of this Section 2.09 any such increased
costs resulting from (i) Taxes or Other Taxes (as to which Section 2.11
shall govern) and (ii) changes in the basis of taxation of overall net
income or overall gross income by the United States or by the foreign
jurisdiction or state under the laws of which such Lender is organized or
has its Applicable Lending Office or any political subdivision thereof),
then the Borrower shall from time to time, upon demand by such Lender (with
a copy of such demand to the Agent), pay to the Agent for the account of
such Lender additional amounts sufficient to compensate such Lender for
such increased cost. A certificate as to the amount of such increased
cost, submitted to the Borrower by such Lender, shall be conclusive and
binding for all purposes, absent manifest error.
(b) If any Lender determines that compliance with any law or
regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) affects or
would affect the amount of capital required or expected to be maintained by
such Lender or any corporation controlling such Lender and that the amount
of such capital is increased by or based upon the existence of such
Lender's commitment to lend hereunder and other commitments of such type,
then, upon demand by such Lender (with a copy of such demand to the Agent),
the Borrower shall pay to the Agent for the account of such Lender, from
time to time as specified by such Lender, additional amounts sufficient to
compensate such Lender in the light of such circumstances, to the extent
that such Lender reasonably determines such increase in capital to be
allocable to the existence of such Lender's commitment to lend. A certifi-
cate as to such amounts submitted to the Borrower by such Lender shall be
conclusive and binding for all purposes, absent manifest error.
(c) If, with respect to any Eurodollar Rate Advances, the
Required Lenders notify the Agent that the Eurodollar Rate for any Interest
Period for such Advances will not adequately reflect the cost to such
Lenders of making, funding or maintaining their Eurodollar Rate Advances
for such Interest Period, the Agent shall forthwith so notify the Borrower
and the Lenders, whereupon (i) each such Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest Period
therefor, Convert into a Prime Rate Advance and (ii) the obligation of the
Lenders to make, or to Convert Advances into, Eurodollar Rate Advances
shall be suspended until the Agent shall notify the Borrower that such
Lenders have determined that the circumstances causing such suspension no
longer exist.
(d) Notwithstanding any other provision of this Agreement, if
the introduction of or any change in or in the interpretation of any law or
regulation shall make it unlawful, or any central bank or other governmen-
tal authority shall assert that it is unlawful, for any Lender or its
Eurodollar Lending Office to perform its obligations hereunder to make
Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate
Advances hereunder, then, on notice thereof and demand therefor by such
Lender to the Borrower through the Agent, (i) each Eurodollar Rate Advance
will automatically, upon such demand, Convert into a Prime Rate Advance and
(ii) the obligation of the Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended until the Agent shall notify
the Borrower that such Lender has determined that the circumstances causing
such suspension no longer exist.
SECTION 2.10. Payments and Computations. (a) The Borrower
_________________________
shall make each payment hereunder and under the Notes, irrespective of any
right of counterclaim or set-off (except as
<PAGE #>
otherwise provided in Section 2.14), not later than 10:00 A.M. (Dallas,
Texas time) on the day when due in U.S. dollars to the Agent at the Agent's
Account in same day funds. The Agent will promptly thereafter cause like
funds to be distributed (i) if such payment by the Borrower is in respect
of principal, interest, commitment fees or any other Obligation then
payable hereunder and under the Notes to more than one Lender, to such
Lenders for the account of their respective Applicable Lending Offices
ratably in accordance with the amounts of such respective Obligations then
payable to such Lenders and (ii) if such payment by the Borrower is in
respect of any Obligation then payable hereunder to one Lender, to such
Lender for the account of its Applicable Lending Office, in each case to be
applied in accordance with the terms of this Agreement. Upon its accep-
tance of an Assignment and Acceptance and recording of the information
contained therein in the Register pursuant to Section 8.07(d), from and
after the effective date of such Assignment and Acceptance, the Agent shall
make all payments hereunder and under the Notes in respect of the interest
assigned thereby to the Lender assignee thereunder, and the parties to such
Assignment and Acceptance shall make all appropriate adjustments in such
payments for periods prior to such effective date directly between them-
selves.
(b) The Borrower hereby authorizes each Lender, if and to the
extent payment owed to such Lender is not made when due hereunder or, in
the case of a Lender, under the Note held by such Lender, to charge from
time to time against any or all of the Borrower's accounts with such Lender
any amount so due.
(c) All computations of interest and fees shall be made by the
Agent on the basis of a year of 360 days for Eurodollar Rate Advances and
365 or 366 days, as applicable, for Prime Rate Advances, in each case for
the actual number of days (including the first day but excluding the last
day) occurring in the period for which such interest or fees are payable.
Each determination by the Agent of an interest rate or fee hereunder shall
be conclusive and binding for all purposes, absent manifest error.
(d) Whenever any payment hereunder or under the Notes shall be
stated to be due on a day other than a Business Day, such payment shall be
made on the next succeeding Business Day, and such extension of time shall
in such case be included in the computation of payment of interest or
commitment fee, as the case may be; provided, however, that, if such
________ _______
extension would cause payment of interest on or principal of Eurodollar
Rate Advances to be made in the next following calendar month, such payment
shall be made on the next preceding Business Day.
(e) Unless the Agent shall have received notice from the
Borrower prior to the date on which any payment is due to any Lender
hereunder that the Borrower will not make such payment in full, the Agent
may assume that the Borrower has made such payment in full to the Agent on
such date and the Agent may, in reliance upon such assumption, cause to be
distributed to each such Lender on such due date an amount equal to the
amount then due such Lender. If and to the extent the Borrower shall not
have so made such payment in full to the Agent, each such Lender shall
repay to the Agent forthwith on demand such amount distributed to such
Lender together with interest thereon, for each day from the date such
amount is distributed to such Lender until the date such Lender repays such
amount to the Agent, at the Federal Funds Rate.
SECTION 2.11. Taxes. (a) Any and all payments by the Borrower
_____
hereunder or under the Notes shall be made, in accordance with
Section 2.10, free and clear of and without deduction for any and all
present or future taxes, levies, imposts, deductions, charges or withhold-
ings, and all liabilities with respect thereto, excluding, in the case of
_________
each Lender and the Agent, net income taxes that are imposed by the United
States and net income taxes (or franchise taxes imposed in lieu thereof)
that are imposed on such Lender or the Agent by the state or foreign
jurisdiction under the laws of which such Lender or the Agent (as the case
may be) is organized or any political subdivision thereof and, in the case
of each
<PAGE #>
Lender, net income taxes (or franchise taxes imposed in lieu thereof) that
are imposed on such Lender by the state or foreign jurisdiction of such
Lender's Applicable Lending Office or any political subdivision thereof
(all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities in respect of payments hereunder or under the
Notes being hereinafter referred to as "Taxes"). If the Borrower
_____
shall be required by law to deduct any Taxes from or in respect of any sum
payable hereunder or under any Note to any Lender or the Agent, (i) the sum
payable shall be increased as may be necessary so that after making all
required deductions (including deductions applicable to additional sums
payable under this Section 2.11) such Lender or the Agent (as the case may
be) receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and
(iii) the Borrower shall pay the full amount deducted to the relevant
taxation authority or other authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any present or future
stamp, documentary, excise, property or similar taxes, charges or levies
that arise from any payment made hereunder or under the Notes or from the
execution, delivery or registration of, performing under, or otherwise with
respect to, this Agreement or the Notes (hereinafter referred to as "Other
_____
Taxes").
_____
(c) The Borrower shall indemnify each Lender and the Agent for
the full amount of Taxes and Other Taxes, and for the full amount of taxes
imposed by any jurisdiction on amounts payable under this Section 2.11,
imposed on or paid by such Lender or the Agent (as the case may be) and any
liability (including penalties, additions to tax, interest and expenses)
arising therefrom or with respect thereto. This indemnification shall be
made within 30 days from the date such Lender or the Agent (as the case may
be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes, the
Borrower shall furnish to the Agent, at its address referred to in Sec-
tion 8.02, the original receipt of payment thereof or a certified copy of
such receipt. In the case of any payment hereunder or under the Notes by
or on behalf of the Borrower through an account or branch outside the
United States or by or on behalf of the Borrower by a payor that is not a
United States person, if the Borrower determines that no Taxes are payable
in respect thereof, the Borrower shall furnish, or shall cause such payor
to furnish, to the Agent, at such address, an opinion of counsel acceptable
to the Agent stating that such payment is exempt from Taxes. For purposes
of this subsection (d) and subsection (e), the terms "United States" and
_____________
"United States person" shall have the meanings specified in Section 7701 of
____________________
the Internal Revenue Code.
(e) Each Lender organized under the laws of a jurisdiction
outside the United States shall, on or prior to the date of its execution
and delivery of this Agreement in the case of each Initial Lender, as the
case may be, and on the date of the Assignment and Acceptance pursuant to
which it became a Lender in the case of each other Lender, and from time to
time thereafter as requested in writing by the Borrower or the Agent (but
only so long thereafter as such Lender remains lawfully able to do so),
provide each of the Agent and the Borrower with two original Internal
Revenue Service forms 1001 or 4224. If the forms provided by a Lender at
the time such Lender first becomes a party to this Agreement indicates a
United States interest withholding tax rate in excess of zero, withholding
tax at such rate shall be considered excluded from Taxes unless and until
such Lender provides the appropriate form certifying that a lesser rate
applies, whereupon withholding tax at such lesser rate only shall be
considered excluded from Taxes for periods governed by such form; provided,
________
however, that, if at the date of the Assignment and Acceptance pursuant to
_______
which a Lender becomes a party to this Agreement, the Lender assignor was
entitled to payments under subsection (a) in respect of United States
withholding tax with respect to interest paid at such date, then, to such
extent, the term Taxes shall include (in addition to withholding taxes that
may be imposed in the future or other amounts otherwise includable in
Taxes) United States withholding tax, if any, applicable with respect to
the Lender assignee on such date. If any
<PAGE #>
form or document referred to in this subsection (e) requires the disclosure
of information, other than information necessary to compute the tax payable
and information required on the date hereof by Internal Revenue Service
form 1001 or 4224, that the Lender reasonably considers to be confidential,
the Lender shall give notice thereof to the Borrower and shall not be
obligated to include in such form or document such confidential informa-
tion.
(f) For any period with respect to which a Lender has failed to
provide the Borrower with the appropriate form described in subsection (e)
(other than if such failure is due to a change in law occurring after the
_____ ____
date on which a form originally was required to be provided or if such form
otherwise is not required under subsection (e)), such Lender shall not be
entitled to indemnification under subsection (a) or (c) with respect to
Taxes imposed by the United States by reason of such failure; provided,
________
however, that should a Lender become subject to Taxes because of its
_______
failure to deliver a form required hereunder, the Borrower shall take such
steps as such Lender shall reasonably request to assist such Lender to
recover such Taxes.
SECTION 2.12. Sharing of Payments, Etc. If any Lender shall
________________________
obtain at any time any payment (whether voluntary, involuntary, through the
exercise of any right of set-off, or otherwise) (a) on account of Obliga-
tions due and payable to such Lender hereunder and under the Notes at such
time in excess of its ratable share (according to the proportion of (i) the
amount of such Obligations due and payable to such Lender at such time to
(ii) the aggregate amount of the Obligations due and payable to all Lenders
hereunder and under the Notes at such time) of payments on account of the
Obligations due and payable to all Lenders hereunder and under the Notes at
such time obtained by all the Lenders at such time or (b) on account of
Obligations owing (but not due and payable) to such Lender hereunder and
under the Notes at such time in excess of its ratable share (according to
the proportion of (i) the amount of such Obligations owing to such Lender
at such time to (ii) the aggregate amount of the Obligations owing (but not
due and payable) to all Lenders hereunder and under the Notes at such time)
of payments on account of the Obligations owing (but not due and payable)
to all Lenders hereunder and under the Notes at such time obtained by all
of the Lenders at such time, such Lender shall forthwith purchase from the
other Lenders such participations in the Obligations due and payable or
owing to them, as the case may be, as shall be necessary to cause such
purchasing Lender to share the excess payment ratably with each of them;
provided, however, that if all or any portion of such excess payment is
________ _______
thereafter recovered from such purchasing Lender, such purchase from each
other Lender shall be rescinded and such other Lender shall repay to the
purchasing Lender the purchase price to the extent of such Lender's ratable
share (according to the proportion of (i) the purchase price paid to such
Lender to (ii) the aggregate purchase price paid to all Lenders) of such
recovery together with an amount equal to such Lender's ratable share
(according to the proportion of (i) the amount of such other Lender's
required repayment to (ii) the total amount so recovered from the purchas-
ing Lender) of any interest or other amount paid or payable by the purchas-
ing Lender in respect of the total amount so recovered. The Borrower
agrees that any Lender so purchasing a participation from another Lender
pursuant to this Section 2.12 may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation.
SECTION 2.13. Use of Proceeds. The proceeds of the Advances
_______________
shall be available (and the Borrower agrees that it shall use such pro-
ceeds) solely to pay to the holders of the Company Stock (other than the
Borrower) the cash consideration for their shares in the Tender Offer or
Merger, pay interest on Borrowings hereunder, pay transaction fees and
expenses and, subsequent to the Merger, for working capital purposes.
<PAGE #>
SECTION 2.14. Defaulting Lenders. (a) In the event that, at
__________________
any one time, (i) any Lender shall be a Defaulting Lender, (ii) such
Defaulting Lender shall owe a Defaulted Advance to the Borrower and
(iii) the Borrower shall be required to make any payment hereunder or under
any other Loan Document to or for the account of such Defaulting Lender,
then the Borrower may, so long as no Default shall occur or be continuing
at such time and to the fullest extent permitted by applicable law, set off
and otherwise apply the Obligation of the Borrower to make such payment to
or for the account of such Defaulting Lender against the obligation of such
Defaulting Lender to make such Defaulted Advance. In the event that, on
any date, the Borrower shall so set off and otherwise apply its obligation
to make any such payment against the obligation of such Defaulting Lender
to make any such Defaulted Advance on or prior to such date, the amount so
set off and otherwise applied by the Borrower shall constitute for all
purposes of this Agreement and the other Loan Documents an Advance by such
Defaulting Lender made on the date under the Facility pursuant to which
such Defaulted Advance was originally required to have been made pursuant
to Section 2.01. Such Advance shall be a Prime Rate Advance and shall be
considered, for all purposes of this Agreement, to comprise part of the
Borrowing in connection with which such Defaulted Advance was originally
required to have been made pursuant to Section 2.01, even if the other
Advances comprising such Borrowing shall be Eurodollar Rate Advances on the
date such Advance is deemed to be made pursuant to this subsection (a).
The Borrower shall notify the Agent at any time the Borrower exercises its
right of set-off pursuant to this subsection (a) and shall set forth in
such notice (A) the name of the Defaulting Lender and the Defaulted Advance
required to be made by such Defaulting Lender and (B) the amount set off
and otherwise applied in respect of such Defaulted Advance pursuant to this
subsection (a). Any portion of such payment otherwise required to be made
by the Borrower to or for the account of such Defaulting Lender which is
paid by the Borrower, after giving effect to the amount set off and
otherwise applied by the Borrower pursuant to this subsection (a), shall be
applied by the Agent as specified in subsection (b) or (c) of this Sec-
tion 2.14.
(b) In the event that, at any one time, (i) any Lender shall be
a Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted
Amount to the Agent or any of the other Lenders and (iii) the Borrower
shall make any payment hereunder or under any other Loan Document to the
Agent for the account of such Defaulting Lender, then the Agent may, on its
behalf or on behalf of such other Lenders and to the fullest extent
permitted by applicable law, apply at such time the amount so paid by the
Borrower to or for the account of such Defaulting Lender to the payment of
each such Defaulted Amount to the extent required to pay such Defaulted
Amount. In the event that the Agent shall so apply any such amount to the
payment of any such Defaulted Amount on any date, the amount so applied by
the Agent shall constitute for all purposes of this Agreement and the other
Loan Documents payment, to such extent, of such Defaulted Amount on such
date. Any such amount so applied by the Agent shall be retained by the
Agent or distributed by the Agent to such other Lenders, ratably in
accordance with the respective portions of such Defaulted Amounts payable
at such time to the Agent and such other Lenders and, if the amount of such
payment made by the Borrower shall at such time be insufficient to pay all
Defaulted Amounts owing at such time to the Agent and the other Lenders, in
the following order of priority:
(i) first, to the Agent for any Defaulted Amount then owing to
_____
the Agent; and
(ii) second, to any other Lenders for any Defaulted Amounts then
______
owing to such other Lenders, ratably in accordance with such respec-
tive Defaulted Amounts then owing to such other Lenders.
Any portion of such amount paid by the Borrower for the account of such
Defaulting Lender remaining, after giving effect to the amount applied by
the Agent pursuant to this subsection (b), shall be applied by the Agent as
specified in subsection (c) of this Section 2.14.
<PAGE #>
(c) In the event that, at any one time, (i) any Lender shall be
a Defaulting Lender, (ii) such Defaulting Lender shall not owe a Defaulted
Advance or a Defaulted Amount and (iii) the Borrower, the Agent or any
other Lender shall be required to pay or distribute any amount hereunder or
under any other Loan Document to or for the account of such Defaulting
Lender, then the Borrower or such other Lender shall pay such amount to the
Agent to be held by the Agent, to the fullest extent permitted by applica-
ble law, in escrow or the Agent shall, to the fullest extent permitted by
applicable law, hold in escrow such amount otherwise held by it. Any funds
held by the Agent in escrow under this subsection (c) shall be deposited by
the Agent in an account with NationsBank, in the name and under the control
of the Agent, but subject to the provisions of this subsection (c). The
terms applicable to such account, including the rate of interest payable
with respect to the credit balance of such account from time to time, shall
be NationsBank's standard terms applicable to escrow accounts maintained
with it. Any interest credited to such account from time to time shall be
held by the Agent in escrow under, and applied by the Agent from time to
time in accordance with the provisions of, this subsection (c). The Agent
shall, to the fullest extent permitted by applicable law, apply all funds
so held in escrow from time to time to the extent necessary to make any
Advances required to be made by such Defaulting Lender and to pay any
amount payable by such Defaulting Lender hereunder and under the other Loan
Documents to the Agent or any other Lender, as and when such Advances or
amounts are required to be made or paid and, if the amount so held in
escrow shall at any time be insufficient to make and pay all such Advances
and amounts required to be made or paid at such time, in the following
order of priority:
(i) first, to the Agent for any amount then due and payable by
_____
such Defaulting Lender to the Agent hereunder;
(ii) second, to any other Lenders for any amount then due and
______
payable by such Defaulting Lender to such other Lenders hereunder,
ratably in accordance with such respective amounts then due and
payable to such other Lenders; and
(iii) third, to the Borrower for any Advance then required to
_____
be made by such Defaulting Lender pursuant to a Commitment of such
Defaulting Lender.
In the event that any Lender that is a Defaulting Lender shall, at any
time, cease to be a Defaulting Lender, any funds held by the Agent in
escrow at such time with respect to such Lender shall be distributed by the
Agent to such Lender and applied by such Lender to the Obligations owing to
such Lender at such time under this Agreement and the other Loan Documents
ratably in accordance with the respective amounts of such Obligations
outstanding at such time.
(d) The rights and remedies against a Defaulting Lender under
this Section 2.14 are in addition to other rights and remedies that the
Borrower may have against such Defaulting Lender with respect to any
Defaulted Advance and that the Agent or any Lender may have against such
Defaulting Lender with respect to any Defaulted Amount.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. Conditions Precedent to Initial Extension of
____________________________________________
Credit. The obligation of each Lender to make an Advance on the occasion
______
of the Initial Extension of Credit hereunder is subject to the satisfaction
of the following conditions precedent before or concurrently with the
Initial Extension of Credit:
<PAGE #>
(a) Holders of no fewer than the minimum number of shares of
Company Stock specified in the Offer to Purchase shall have validly
tendered such Company Stock pursuant to the Tender Offer and shall not
have withdrawn such Company Stock; the Borrower shall have accepted
such Company Stock for payment, and shall have paid the Depositary for
such Company Stock, strictly in accordance with the terms of the Offer
to Purchase and the Merger Agreement, without any waiver or amendment
not consented to by the Lenders of any term, provision or condition
set forth therein, and in compliance with all applicable laws; and the
Lenders shall be satisfied in their sole discretion that the restric-
tions in Section 203 of the Delaware General Corporation Law are not
applicable to the purchase of the Company Stock or the Merger or that
any conditions to avoiding the restrictions contained therein have
been satisfied.
(b) The Company's Board of Directors shall have approved the
Tender Offer and the Merger and recommended that its shareholders
tender their Company Stock pursuant to the Tender Offer, and such
recommendation shall not have been withdrawn or qualified.
(c) The Merger Agreement shall be in full force and effect and
shall not have been terminated.
(d) All shares of Company Stock owned by Affiliates of the
Borrower shall have been contributed to the Borrower.
(e) Holdings shall have received $60,000,000 in Net Cash Pro-
ceeds of the sale of equity to be issued upon the Tender Offer, and
all of such Net Cash Proceeds shall have been contributed by Holdings
to the Borrower as equity and shall have been used by the Borrower
solely to pay to the holders of the Company Stock (other than the
Borrower) a portion of the cash consideration for their shares in the
Tender Offer and to pay transaction fees and expenses.
(f) The aggregate amount of transaction fees and expenses
payable by or on behalf of the Borrower, the Company or any of its
Subsidiaries to each of the Persons rendering advice or providing
services or financing in connection with the Tender Offer shall not
exceed $6,000,000.
(g) The Lenders shall be satisfied with the corporate and legal
structure and capitalization of each Loan Party and of its Subsidiar-
ies, including the terms and conditions of the charter, bylaws and
each class of capital stock of each Loan Party and each such Subsid-
iary and of each agreement or instrument relating to such structure or
capitalization.
(h) [Intentionally Omitted]
(i) Before giving effect to the Tender Offer and the other
transactions contemplated by this Agreement, there shall have occurred
no Material Adverse Change since December 31, 1996.
(j) There shall exist no action, suit, investigation, litigation
or proceeding affecting Welsh Carson, any other Loan Party or any of
such other Loan Party's Subsidiaries pending or threatened before any
court, governmental agency or arbitrator that (i) could be reasonably
likely to have a Material Adverse Effect or (ii) purports to affect
the legality, validity or enforceability of the Tender Offer, the
Merger, this Agreement, any Note, any other Loan Document, any Related
Document or the consummation of the transactions contemplated hereby.
<PAGE #>
(k) Nothing shall have come to the attention of the Lenders
during the course of their due diligence investigation to lead them to
believe (i) that the information, exhibits and reports furnished to
the Lenders prior to issuing their Commitments (the "Pre-Commitment
______________
Information") was or has become misleading, incorrect or incomplete in
___________
any material respect, (ii) that the Company does not have good and
marketable title to all material assets of the Company and its Subsid-
iaries reflected in the Pre-Commitment Information and (iii) that the
Tender Offer or the Merger will have a Material Adverse Effect;
without limiting the generality of the foregoing, the Lenders shall
have been given such access to the management, records, books of
account, contracts and properties of the Company and its Subsidiaries
as they shall have requested.
(l) The Borrower shall have paid all accrued fees and expenses
of the Agent and the Lenders (including the accrued fees and expenses
of counsel to the Agent).
(m) The Agent shall have received on or before the day of
the Initial Extension of Credit the following, each dated such day
(unless otherwise specified), in form and substance satisfactory to
the Lenders (unless otherwise specified) and (except for the Notes) in
sufficient copies for each Lender:
(i) The Notes payable to the order of the Lenders.
(ii) Certified copies of the resolutions of the Board of
Directors of Holdings and the Borrower, approving the Tender
Offer, the Merger, this Agreement, the Notes, each other Loan
Document and each Related Document to which it is or is to be a
party, and of all documents evidencing other necessary corporate
action and governmental and other third party approvals and
consents, if any, with respect to the Tender Offer, the Merger,
this Agreement, the Notes, each other Loan Document and each
Related Document.
(iii) Certified copies of the resolutions of the Board
of Directors of the Company approving the Tender Offer, the
Merger and each Related Document to which it is or is to be a
party, and of all documents evidencing other necessary corporate
action and governmental approvals, if any, with respect to the
Tender Offer, the Merger and each Related Document.
(iv) A copy of a certificate of the Secretary of State of
the jurisdiction of its incorporation, dated reasonably near the
date of the Initial Extension of Credit, listing the charter of
Holdings, the Borrower and the Company and each amendment thereto
on file in his office and certifying that (A) such amendments are
the only amendments to Holdings', the Borrower's or the Company's
charter on file in his office, (B) Holdings, the Borrower and the
Company have paid all franchise taxes to the date of such certif-
icate and (C) Holdings, the Borrower and the Company are duly
incorporated and in good standing under the laws of the State of
the jurisdiction of its incorporation.
(v) A certificate of the Borrower, signed on behalf of the
Borrower and Holdings by its President or a Vice President and
its Secretary or any Assistant Secretary, dated the date of the
Initial Extension of Credit (the statements made in which certif-
icate shall be true on and as of the date of the Initial Exten-
sion of Credit), certifying as to (A) the absence of any amend-
ments to the charter of the Borrower or Holdings since the date
of the Secretary of State's certificate referred to in
Section 3.01(m)(v), (B) a true and correct copy of the bylaws of
the Borrower and Holdings as in effect on the date of the
<PAGE #>
Initial Extension of Credit, (C) the due incorporation and good
standing of the Borrower and Holdings as a corporation organized
under the laws of the State of Delaware, and the absence of any
proceeding for the dissolution or liquidation of the Borrower,
(D) the truth of the representations and warranties contained in
the Loan Documents as though made on and as of the date of the
Initial Extension of Credit and (E) the absence of any event
occurring and continuing, or resulting from the Initial Extension
of Credit, that constitutes a Default.
(vi) A certificate of the Secretary or an Assistant Secre-
tary or other authorized officer of the Borrower and Holdings
certifying the names and true signatures of the officers of the
Borrower and Holdings authorized to sign this Agreement, the
Notes, each other Loan Document and each Related Document to
which they are or are to be parties and the other documents to be
delivered hereunder and thereunder.
(vii) A pledge agreement in substantially the form of
Exhibit D hereto as amended, supplemented or otherwise modified
from time to time in accordance with its terms, the "Borrower
________
Pledge Agreement"), duly executed by the Borrower, together with:
________________
(A) certificates representing the Pledged Shares
referred to therein accompanied by undated stock powers
executed in blank and instruments evidencing the Pledged
Debt referred to therein indorsed in blank,
(B) duly executed proper financing statements, to be
filed under the Uniform Commercial Code of all jurisdictions
that the Agent may deem necessary or desirable in order to
perfect and protect the first priority liens and security
interests created under the Borrower Pledge Agreement,
covering the Collateral described in the Borrower Pledge
Agreement, and
(C) evidence that all other action that the Agent may
deem necessary or desirable in order to perfect and protect
the first priority liens and security interests created
under the Borrower Pledge Agreement has been taken.
(viii) A pledge agreement in substantially the form of
Exhibit E hereto as amended, supplemented or otherwise modified
from time to time in accordance with its terms, the "Holdings
________
Pledge Agreement"), duly executed by Holdings, together with:
________________
(A) certificates representing the Pledged Shares
referred to therein accompanied by undated stock powers
executed in blank and instruments evidencing the Pledged
Debt referred to therein indorsed in blank,
(B) duly executed proper financing statements, to be
filed under the Uniform Commercial Code of all jurisdictions
that the Agent may deem necessary or desirable in order to
perfect and protect the first priority liens and security
interests created under the Holdings Pledge Agreement,
covering the Collateral described in the Holdings Pledge
Agreement, and
(C) evidence that all other action that the Agent may
deem necessary or desirable in order to perfect and protect
the first priority liens and security interests created
under the Holdings Pledge Agreement has been taken.
<PAGE #>
(ix) A security agreement in substantially the form of
Exhibit F hereto (as amended, supplemented or otherwise modified
from time to time in accordance with its terms, the "Security
________
Agreement"), duly executed by the Borrower and Holdings, together
_________
with:
(A) duly executed proper financing statements, to be
filed under the Uniform Commercial Code of all jurisdictions
that the Agent may deem necessary or desirable in order to
perfect and protect the first priority liens and security
interests created under the Security Agreement, covering the
Collateral described in the Security Agreement,
(B) copies of the Assigned Agreements referred to in
the Security Agreement, together with a consent to such
assignment, in substantially the form of Exhibit B to the
Security Agreement, duly executed by each party to such
Assigned Agreements other than the Borrower, and
(C) evidence that all other action that the Agent may
deem necessary or desirable in order to perfect and protect
the first priority liens and security interests created
under the Security Agreement has been taken.
(x) A guaranty in substantially the form of Exhibit G
hereto (as amended, supplemented or otherwise modified from time
to time in accordance with its terms, the "Holdings Guaranty"),
_________________
duly executed by Holdings.
(xi) A guaranty in substantially the form of Exhibit H
hereto (as amended, supplemented or otherwise modified from time
to time in accordance with its terms, the "Welsh Carson Guaran-
____________________
ty"), duly executed by Welsh Carson.
__
(xii) Federal Reserve Forms U-1 provided for in Regula-
tion U, the statements made in which shall be such as to permit
the transactions contemplated hereby in accordance with Regula-
tion U.
(xiii) Certified copies of each of the Related Documents,
duly executed by the parties thereto and in form and substance
satisfactory to the Lenders, together with all agreements,
instruments and other documents delivered in connection there-
with.
(xiv) Certificates in form and substance satisfactory to
the Agent, attesting to the Solvency of Holdings and the Surviv-
ing Corporation on a pro forma basis after giving effect to the
Merger and the other transactions contemplated hereby, from the
chief financial officers of Holdings and the Borrower.
(xv) A favorable opinion of Reboul, MacMurray, Hewitt,
Maynard & Kristol, counsel for the Loan Parties, in substantially
the form of Exhibit I hereto and as to such other matters as any
Lender through the Agent may reasonably request.
(xvi) A favorable opinion of Shearman & Sterling,
counsel for the Agent, in form and substance satisfactory to the
Agent.
SECTION 3.02. Conditions Precedent to Each Borrowing. The
______________________________________
obligation of each Lender to make an Advance on the occasion of each
Borrowing (including the Initial Extension of Credit)
<PAGE #>
shall be subject to the further conditions precedent that on the date of
such Borrowing (a) the following statements shall be true (and each of the
giving of the applicable Notice of Borrowing and the acceptance by the
Borrower of the proceeds of such Borrowing shall constitute a representa-
tion and warranty by the Borrower that both on the date of such notice and
on the date of such Borrowing such statements are true):
(i) the representations and warranties contained in each Loan
Document are correct on and as of such date, before and after giving
effect to such Borrowing and to the application of the proceeds
therefrom, as though made on and as of such date; and
(ii) no event has occurred and is continuing, or would result
from such Borrowing or from the application of the proceeds therefrom,
that constitutes a Default;
and (b) the Agent shall have received such other approvals, opinions or
documents as any Lender through the Agent may reasonably request.
SECTION 3.03. Determinations Under Section 3.01. For purposes
_________________________________
of determining compliance with the conditions specified in Section 3.01,
each Lender shall be deemed to have consented to, approved or accepted or
to be satisfied with each document or other matter required thereunder to
be consented to or approved by or acceptable or satisfactory to the Lenders
unless an officer of the Agent responsible for the transactions contemplat-
ed by the Loan Documents shall have received notice from such Lender prior
to the Initial Extension of Credit specifying its objection thereto and
such Lender shall not have made available to the Agent such Lender's
ratable portion of such Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower.
______________________________________________
The Borrower represents and warrants as follows:
(a) Each Loan Party (i) is a corporation or limited partnership
duly organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation or organization, (ii) is duly
qualified and in good standing as a foreign corporation in each other
jurisdiction in which it owns or leases property or in which the
conduct of its business requires it to so qualify or be licensed
except where the failure to so qualify or be licensed would not be
reasonably likely to have a Material Adverse Effect and (iii) has all
requisite corporate or partnership power and authority (including,
without limitation, all governmental licenses, permits and other
approvals) to own or lease and operate its properties and to carry on
its business as now conducted and as proposed to be conducted. All of
the outstanding capital stock of Holdings has been validly issued, is
fully paid and non-assessable and is owned by the Equity Investors or
other Persons in the amounts specified on Schedule 4.01(a) hereto, and
all of the outstanding capital stock of the Borrower has been validly
issued, is fully paid and non-assessable and is owned by Holdings, in
each case free and clear of all Liens, except those created under the
Collateral Documents.
(b) The Borrower has no Subsidiaries, other than, following the
consummation of the Tender Offer, the Company and its Subsidiaries.
<PAGE #>
(c) The execution, delivery and performance by each Loan Party
of this Agreement, the Notes, each other Loan Document and each
Related Document to which it is or is to be a party, and the consumma-
tion of the Tender Offer, the Merger and the other transactions
contemplated hereby, are within such Loan Party's corporate or part-
nership powers, have been duly authorized by all necessary corporate
or partnership action, and do not (i) contravene such Loan Party's
charter or bylaws or other organizational documents, (ii) violate any
law (including, without limitation, the Securities Exchange Act of
1934 and the Racketeer Influenced and Corrupt Organizations Chapter of
the Organized Crime Control Act of 1970), rule, regulation (including,
without limitation, Regulation X of the Board of Governors of the
Federal Reserve System), order, writ, judgment, injunction, decree,
determination or award, (iii) conflict with or result in the breach
of, or constitute a default under, any contract, loan agreement,
indenture, mortgage, deed of trust, lease or other instrument binding
on or affecting any Loan Party, any of its Subsidiaries or any of
their properties, except, with respect to the consummation of the
Tender Offer and the Merger, as set forth in the Schedules to the
Merger Agreement or (iv) except for the Liens created under the Loan
Documents, result in or require the creation or imposition of any Lien
upon or with respect to any of the properties of any Loan Party or any
of its Subsidiaries. Neither Welsh Carson, any other Loan Party nor
any of such other Loan Party's Subsidiaries is in violation of any
such law, rule, regulation, order, writ, judgment, injunction, decree,
determination or award or in breach of any such contract, loan agree-
ment, indenture, mortgage, deed of trust, lease or other instrument,
the violation or breach of which could be reasonably likely to have a
Material Adverse Effect.
(d) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory
body or any other third party is required for (i) the due execution,
delivery, recordation, filing or performance by any Loan Party of this
Agreement, the Notes, any other Loan Document or any Related Document
to which it is or is to be a party, or for the consummation of the
Tender Offer, the Merger or the other transactions contemplated
hereby, (ii) the grant by any Loan Party of the Liens granted by it
pursuant to the Collateral Documents, (iii) except for the filing of
UCC-1 financing statements, the perfection or maintenance of the Liens
created under the Collateral Documents (including the first priority
nature thereof) or (iv) the exercise by the Agent or any Lender of its
rights under the Loan Documents or the remedies in respect of the
Collateral pursuant to the Collateral Documents except for the autho-
rizations, approvals, actions, notices and filings listed on Sched-
ule 4.01(d) hereto, all of which have been duly obtained, taken, given
or made and are in full force and effect. All applicable waiting
periods in connection with the Tender Offer and the other transactions
contemplated hereby have expired without any action having been taken
by any competent authority restraining, preventing or imposing materi-
ally adverse conditions upon the Tender Offer or the rights of Welsh
Carson, the other Loan Parties or such other Loan Party's Subsidiaries
freely to transfer or otherwise dispose of, or to create any Lien on,
any properties now owned or hereafter acquired by any of them.
(e) This Agreement has been, and each of the Notes, each other
Loan Document and each Related Document when delivered hereunder will
have been, duly executed and delivered by each Loan Party thereto.
This Agreement is, and each of the Notes, each other Loan Document and
each Related Document when delivered hereunder will be, the legal,
valid and binding obligation of each Loan Party thereto, enforceable
against such Loan Party in accordance with its terms.
(f) The Consolidated balance sheets of the Company and its
Subsidiaries as at December 31, 1996, and the related Consolidated
statement of income and Consolidated statement
<PAGE #>
of cash flows of the Company and its Subsidiaries for the fiscal year
then ended, accompanied by an opinion of KPMG Peat Marwick LLP,
independent public accountants, and the Consolidated balance sheet of
the Company and its Subsidiaries as at March 31, 1997, and the related
Consolidated statement of income and Consolidated statement of cash
flows of the Company and its Subsidiaries for the three months then
ended, copies of which have been furnished to each Lender, fairly
present, subject, in the case of said balance sheet as at March 31,
1997, and said statements of income and cash flows for the three
months then ended, to year-end audit adjustments, the Consolidated
financial condition of the Company and its Subsidiaries as at such
dates and the Consolidated results of the operations of the Company
and its Subsidiaries for the periods ended on such dates, all in
accordance with generally accepted accounting principles applied on a
consistent basis, and since December 31, 1996, there has been no
Material Adverse Change.
(g) The Consolidated pro forma balance sheet of Holdings, the
Borrower, the Company, and their respective Subsidiaries as at March
31, 1997, and the related Consolidated pro forma statement of income
of Holdings, the Borrower, the Company and their respective Subsidiar-
ies for the three months then ended, copies of which have been fur-
nished to each Lender, fairly present the Consolidated pro forma
financial condition of Holdings, the Borrower, the Company and their
respective Subsidiaries as at such date and the Consolidated pro forma
results of operations of Holdings, the Borrower and their respective
Subsidiaries for the period ended on such date, in each case giving
effect to the Tender Offer, the Merger and the other transactions
contemplated hereby, all in accordance with GAAP.
(h) The Consolidated forecasted balance sheets, income state-
ments and cash flows statements of Holdings, the Borrower, the Company
and their respective Subsidiaries delivered to the Lenders as part of
the Pre-Commitment Information were prepared in good faith on the
basis of the assumptions stated therein, which assumptions were fair
in the light of conditions existing at the time of delivery of such
forecasts, and represented, at the time of delivery, the Borrower's
best estimate of its future financial performance.
(i) Neither the Pre-Commitment Information nor any other infor-
mation, exhibit or report furnished by any Loan Party to the Agent or
any Lender in connection with the negotiation of the Loan Documents or
pursuant to the terms of the Loan Documents contained any untrue
statement of a material fact or omitted to state a material fact
necessary to make the statements made therein, in light of the circum-
stances under which they were made, not misleading.
(j) There is no action, suit, investigation, litigation or
proceeding affecting Welsh Carson, any other Loan Party or any of such
other Loan Party's Subsidiaries, including any Environmental Action,
pending or threatened before any court, governmental agency or arbi-
trator that (i) could be reasonably likely to have a Material Adverse
Effect or (ii) purports to affect the legality, validity or enforce-
ability of the Tender Offer, the Merger, this Agreement, any Note, any
other Loan Document or any Related Document or the consummation of the
transactions contemplated hereby.
(k) No proceeds of any Advance will be used to acquire any
equity security of a class that is registered pursuant to Section 12
of the Securities Exchange Act of 1934, other than the Company Stock.
(l) The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying Margin Stock, and no
proceeds of any Advance will be used to purchase
<PAGE #>
or carry any Margin Stock or to extend credit to others for the
purpose of purchasing or carrying any Margin Stock, other than the
Company Stock.
(m) To the best knowledge of the Borrower, all representations
and warranties of the Company contained in the Merger Agreement are
true and correct.
(n) Neither the business nor the properties of Welsh Carson or
any other Loan Party (other than the Company) or any of such other
Loan Party's Subsidiaries nor, to best knowledge of the Borrower, the
Company, are affected by any fire, explosion, accident, strike,
lockout or other labor dispute, drought, storm, hail, earthquake,
embargo, act of God or of the public enemy or other casualty (whether
or not covered by insurance) that could be reasonably likely to have a
Material Adverse Effect.
(o) None of Holdings, the Borrower or any of their respective
Subsidiaries (other than the Company) nor, to the best knowledge of
the Borrower, the Company is a party to any indenture, loan or credit
agreement or any lease or other agreement or instrument or subject to
any charter or corporate restriction that could be reasonably likely
to have a Material Adverse Effect.
(p) The Collateral Documents create a valid security interest in
the Collateral, securing the payment of the Secured Obligations, and,
upon the filing of UCC-1 financing statements as described in the
Borrower Pledge Agreement, the Holdings Pledge Agreement and the
Security Agreement and the Agent having possession of the certificates
representing the Pledged Shares and the instruments representing the
Pledged Debt as contemplated by the Collateral Documents, all filings
and other actions necessary or desirable to perfect and protect a
first priority security interest have been duly taken. The Loan
Parties are the legal and beneficial owners of the Collateral free and
clear of any Lien, except for the liens and security interests created
or permitted under the Loan Documents.
(q) Holdings, the Borrower and each of their respective Subsid-
iaries and Affiliates (other than the Company) and, to the best
knowledge of the Borrower, the Company has filed, has caused to be
filed or has been included in all tax returns (Federal, state, local
and foreign) required to be filed and has paid all taxes shown thereon
to be due, together with applicable interest and penalties, except as
set forth in the Disclosure Schedule to the Merger Agreement.
(r) The Merger will not be taxable to the Company or any of its
Subsidiaries or Affiliates.
(s) Neither Holdings, the Borrower, the Company nor any of their
respective Subsidiaries is an "investment company," or an "affiliated
person" of, or "promoter" or "principal underwriter" for, an "invest-
ment company," as such terms are defined in the Investment Company Act
of 1940, as amended. Neither the making of any Advances, nor the
application of the proceeds or repayment thereof by the Borrower, nor
the consummation of the other transactions contemplated hereby, will
violate any provision of such Act or any rule, regulation or order of
the Securities and Exchange Commission thereunder.
(t) Each Loan Party is, individually and together with its
Subsidiaries, Solvent.
<PAGE #>
(u) Set forth on Schedule 4.01(u) hereto is a complete and
accurate list of all Existing Debt, showing as of July 31, 1997 the
principal amount outstanding thereunder. As of the date hereof, the
aggregate principal amount of all Existing Debt does not exceed the
amount shown on such Schedule.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants. So long as any Advance
_____________________
shall remain unpaid or any Lender shall have any Commitment hereunder, the
Borrower will:
(a) Compliance with Laws, Etc. Comply, and, from and after the
_________________________
Control Date, cause the Company and each of its Subsidiaries to
comply, in all material respects, with all applicable laws, rules,
regulations and orders, such compliance to include, without limita-
tion, compliance with ERISA and the Racketeer Influenced and Corrupt
Organizations Chapter of the Organized Crime Control Act of 1970.
(b) Payment of Taxes, Etc. Pay and discharge, and, from and
_____________________
after the Control Date, cause the Company and each of its Subsidiaries
to pay and discharge, before the same shall become delinquent, (i) all
taxes, assessments and governmental charges or levies imposed upon it
or upon its property and (ii) all lawful claims that, if unpaid, might
by law become a Lien upon its property; provided, however, that
________ _______
neither the Borrower, nor the Company nor any of its Subsidiaries
shall be required to pay or discharge any such tax, assessment, charge
or claim that is being contested in good faith and by proper proceed-
ings and as to which appropriate reserves are being maintained, unless
and until any Lien resulting therefrom attaches to its property and
becomes enforceable against its other creditors.
(c) Compliance with Environmental Laws. Comply, and, from and
__________________________________
after the Control Date, cause the Company and each of its Subsidiaries
and all lessees and other Persons operating or occupying its proper-
ties to comply, in all material respects, with all applicable Environ-
mental Laws and Environmental Permits; obtain and renew and, from and
after the Control Date, cause the Company and each of its Subsidiaries
to obtain and renew all Environmental Permits necessary for its
operations and properties; and conduct, and, from and after the
Control Date, cause the Company and each of its Subsidiaries to
conduct, any investigation, study, sampling and testing, and undertake
any cleanup, removal, remedial or other action necessary to remove and
clean up all Hazardous Materials from any of its properties, in
accordance with the requirements of all Environmental Laws; provided,
________
however, that neither the Borrower nor the Company nor any of its
_______
Subsidiaries shall be required to undertake any such cleanup, removal,
remedial or other action to the extent that its obligation to do so is
being contested in good faith and by proper proceedings and appropri-
ate reserves are being maintained with respect to such circumstances.
(d) Maintenance of Insurance. Maintain, and, from and after the
________________________
Control Date, cause the Company and each of its Subsidiaries to
maintain, insurance with responsible and reputable insurance companies
or associations in such amounts and covering such risks as is usually
carried by companies engaged in similar businesses and owning similar
properties in the same general areas in which the Borrower, the
Company or such Subsidiary operates.
<PAGE #>
(e) Preservation of Corporate Existence, Etc. Preserve and
________________________________________
maintain, and, from and after the Control Date, cause the Company and
each of its Subsidiaries to preserve and maintain, its existence,
legal structure, legal name, rights (charter and statutory), permits,
licenses, approvals, privileges and franchises; provided, however,
________ _______
that the Borrower and the Company may consummate the Merger and
provided further that neither the Borrower nor the Company nor any of
________ _______
its Subsidiaries shall be required to preserve any right, permit,
license, approval, privilege or franchise if the Board of Directors of
the Borrower, the Company or such Subsidiary shall determine that the
preservation thereof is no longer desirable in the conduct of the
business of the Borrower or such Subsidiary, as the case may be, and
that the loss thereof is not disadvantageous in any material respect
to the Borrower, the Company, such Subsidiary or the Lenders.
(f) Visitation Rights. At any reasonable time and from time to
_________________
time, permit the Agent or any of the Lenders or any agents or repre-
sentatives thereof, to examine and make copies of and abstracts from
the records and books of account of, and visit the properties of, the
Borrower, and to discuss the affairs, finances and accounts of the
Borrower with any of its officers or directors and with its indepen-
dent certified public accountants and, from and after the Control
Date, cause the Company and each of its Subsidiaries to permit the
Agent or any of the Lenders, or any agents or representatives thereof,
to examine and make copies of and abstracts from the records and books
of account of, and visit the properties of, the Company and any of its
Subsidiaries, and to discuss the affairs, finances and accounts of the
Company and any of its Subsidiaries with any of their officers or
directors and with their independent certified public accountants.
(g) Preparation of Environmental Reports. At the request of the
____________________________________
Agent from time to time, provide to the Lenders within 60 days after
such request, at the expense of the Borrower, an environmental site
assessment report for any properties of the Borrower or, from and
after the Control Date, the Company or any of its Subsidiaries,
prepared by an environmental consulting firm acceptable to the Agent,
indicating the presence or absence of Hazardous Materials and the
estimated cost of any compliance, removal or remedial action in
connection with any Hazardous Materials on such properties; without
limiting the generality of the foregoing, if the Agent determines at
any time that a material risk exists that any such report will not be
provided within the time referred to above, the Agent may retain an
environmental consulting firm to prepare such report at the expense of
the Borrower, and the Borrower hereby grants to the Agent, the Lend-
ers, such firm and any agents or representatives thereof an irrevoca-
ble non-exclusive license, subject to the rights of tenants, to enter
onto its properties to undertake such an assessment.
(h) Keeping of Books. Keep, and, from and after the Control
________________
Date, cause the Company and each of its Subsidiaries to keep, proper
books of record and account, in which full and correct entries shall
be made of all financial transactions and the assets and business of
the Borrower, the Company and each such Subsidiary in accordance with
generally accepted accounting principles in effect from time to time.
(i) Maintenance of Properties, Etc. Maintain and preserve, and,
______________________________
from and after the Control Date, cause the Company and each of its
Subsidiaries to maintain and preserve, all of its properties that are
used or useful in the conduct of its business in good working order
and condition, ordinary wear and tear excepted.
(j) Compliance with Terms of Leaseholds. From and after the
___________________________________
Control Date, cause the Company and each of its Subsidiaries to make
all payments and to otherwise perform all obligations in respect of
all leases of real property to which the Company or any of its Subsid-
iaries is a party, keep such leases in full force and effect and not
allow such leases to lapse or be
<PAGE #>
terminated or any rights to renew such leases to be forfeited or
cancelled, notify the Agent of any default by any party with respect
to such leases and cooperate with the Agent in all respects to cure
any such default, except, in any case, where the failure to do so,
either individually or in the aggregate, could not be reasonably
likely to have a Material Adverse Effect.
(k) Performance of Related Documents. Perform and observe, and,
________________________________
from and after the Control Date, cause the Company and its Subsidiar-
ies to perform and observe, all of the terms and provisions of each
Related Document to be performed or observed by it, maintain each such
Related Document in full force and effect (other than the Offer to
Purchase or any other Related Document which expires in accordance
with its terms), enforce such Related Document in accordance with its
terms, take all such action to such end as may be requested from time
to time by the Agent and, upon request of the Agent, make to each
other party to each such Related Document such demands and requests
for information and reports or for action as the Borrower, the Company
or such Subsidiary is entitled to make under such Related Document.
(l) Transactions with Affiliates. Conduct, and, from and after
____________________________
the Control Date, cause the Company and each of its Subsidiaries to
conduct, all transactions otherwise permitted under the Loan Documents
with any of their Affiliates on terms that are fair and reasonable and
no less favorable to the Borrower, the Company or such Subsidiary than
it would obtain in a comparable arm's-length transaction with a Person
not an Affiliate.
(m) Conditions Subsequent to Initial Extension of Credit.
____________________________________________________
Deliver to the Agent as soon as possible and in any event within 45
days after the Initial Extension of Credit (or such later date as may
be agreed by the Borrower and the Agent):
(i) acknowledgment copies of proper financing statements,
duly filed under the Uniform Commercial Code of all jurisdictions
that the Collateral Agent may deem necessary or desirable in
order to perfect and protect the first priority liens and securi-
ty interests created under the Collateral Documents, covering the
Collateral described therein, and
(ii) completed requests for information, listing the financ-
ing statements referred to in clause (i) above and all other
effective financing statements filed in the jurisdictions re-
ferred to in clause (i) above that name Holdings or the Borrower
as debtor, together with copies of such financing statements.
SECTION 5.02. Negative Covenants. So long as any Advance shall
__________________
remain unpaid or any Lender shall have any Commitment hereunder, the
Borrower will not, at any time:
(a) Liens, Etc. Create, incur, assume or suffer to exist, or,
__________
from or after the Control Date, permit the Company or any of its
Subsidiaries to create, incur, assume or suffer to exist, any Lien on
or with respect to any of its properties of any character (including,
without limitation, accounts) whether now owned or hereafter acquired,
or sign or file or suffer to exist, or, from or after the Control
Date, permit the Company or any of its Subsidiaries to sign or file or
suffer to exist, under the Uniform Commercial Code of any jurisdic-
tion, a financing statement that names the Borrower, the Company or
any of its Subsidiaries as debtor, or sign or suffer to exist, or,
from or after the Control Date, permit the Company or any of its
Subsidiaries to sign or suffer to exist, any security agreement
authorizing any secured party thereunder to file such financing
statement, or assign, or, from or after the Control Date, permit the
Company or any of its Subsidiaries to
<PAGE #>
assign, any accounts or other right to receive income, excluding,
_________
however, from the operation of the foregoing restrictions the follow-
_______
ing:
(i) Liens created under the Loan Documents;
(ii) financing statements reasonably requested by lessors
with respect to operating leases entered into in the ordinary
course of business; and
(iii) in the case of the Company and any of its Subsid-
iaries, Liens existing on the property of the Company or any of
its Subsidiaries on the date hereof and Permitted Liens arising
in the ordinary course of business and in a manner and to an
extent consistent with its past practice and necessary or desir-
able for the prudent operation of its business, unless objected
to by the Agent.
(b) Debt. Create, incur, assume or suffer to exist, or, from
____
and after the Control Date, permit the Company or any of its Subsid-
iaries to create, incur, assume or suffer to exist, any Debt other
than:
(i) Debt under the Loan Documents or the Merger Agreement;
(ii) [Intentionally Omitted];
(iii) in the case of the Borrower, Subordinated Debt
owing to Holdings in an aggregate amount not to exceed
$60,000,000, on subordination and other terms and conditions
acceptable to the Lenders, evidenced by an instrument and pledged
to the Lenders pursuant to the Holdings Pledge Agreement; and
(iv) in the case of Subsidiaries of the Company organized
outside of the United States, unsecured Debt incurred in the
ordinary course of business in an aggregate amount for all such
Subsidiaries not to exceed $7,500,000 at any time outstanding and
guaranties thereof by the Borrower to the extent such guaranties
are in effect on the date hereof.
(c) Mergers, Etc. Merge into or consolidate with any Person or
____________
permit any Person to merge into it, or, from and after the Control
Date, permit the Company or any of its Subsidiaries to do so, except
that the Borrower and the Company may consummate the Merger; provided,
________
however, that immediately after giving effect thereto, no event shall
_______
occur and be continuing that constitutes a Default.
(d) Sales, Etc. of Assets. Sell, lease, transfer or otherwise
_____________________
dispose of, or, from and after the Control Date, permit the Company or
any of its Subsidiaries to sell, lease, transfer or otherwise dispose
of, any assets, or grant any option or other right to purchase, lease
or otherwise acquire any assets other than sales of inventory to be
sold or intellectual property to be licensed in the ordinary course of
its business, except, in the case of the Company and any of its
Subsidiaries, (i) sales of inventory or intellectual property to be
licensed in the ordinary course of business in a manner and to an
extent consistent with its past practice and necessary or desirable
for the prudent operation of its business and (ii) sales of assets for
fair value and for cash in an aggregate amount not to exceed $500,000
in any year; provided that in the case of sales of assets pursuant to
________
clause (ii) above, the Borrower shall, on the date of receipt by the
Borrower or any of its
<PAGE #>
Subsidiaries of the Net Cash Proceeds from such sale, prepay the
Advances pursuant to, and in the amount and order of priority set
forth in, Section 2.05(b)(i), as specified therein.
(e) Investments in Other Persons. Make or hold, or, from and
____________________________
after the Control Date, permit the Company or any of its Subsidiaries
to make or hold, any Investment in any Person, other than the purchase
by the Borrower of the Company Stock in the Tender Offer and Invest-
ments by the Company and its Subsidiaries in their Subsidiaries
outstanding on the date hereof; provided, however, that nothing in
________ _______
this subsection shall prevent the Company and its Subsidiaries from
investing in Cash Equivalents in an aggregate principal amount not to
exceed $90,000,000 at any time outstanding or prevent the Company from
making guaranties as permitted by Section 5.02(b)(iv).
(f) Dividends, Etc. Declare or pay any dividends, purchase,
______________
redeem, retire, defease or otherwise acquire for value any of its
capital stock or any warrants, rights or options to acquire such
capital stock, now or hereafter outstanding, return any capital to its
stockholders as such, make any distribution of assets, capital stock,
warrants, rights, options (other than as contemplated by the Merger
Agreement), obligations or securities to its stockholders as such or
issue or sell any capital stock (other than to Holdings as contemplat-
ed by the Merger Agreement) or any warrants, rights or options to
acquire such capital stock, or, from and after the Control Date (other
than as contemplated by the Merger Agreement), permit the Company or
any of its Subsidiaries to do any of the foregoing or permit any of
its Subsidiaries to purchase, redeem, retire, defease or otherwise
acquire for value any capital stock of the Borrower or any warrants,
rights or options to acquire such capital stock or to issue or sell
any capital stock or any warrants, rights or options to acquire such
capital stock, except that, so long as no Default shall have occurred
and be continuing or would result therefrom, the Company's Subsidiar-
ies may pay cash dividends to the Company and the Borrower may make
distributions to the holders of the Company Stock in connection with
the Merger.
(g) Change in Nature of Business. Make, or, from and after the
____________________________
Control Date, permit the Company or any of its Subsidiaries to make,
any material change in the nature of its business as carried on at the
date hereof.
(h) Charter Amendments. Amend, or, from and after the Control
__________________
Date, permit the Company or any of its Subsidiaries to amend, its
certificate of incorporation or bylaws.
(i) Accounting Changes. Make or permit, or, from and after the
__________________
Control Date, permit the Company or any of its Subsidiaries to make or
permit, any change in (i) accounting policies or reporting practices,
except as required by generally accepted accounting principles or (ii)
Fiscal Year.
(j) Prepayments, Etc. of Debt. Prepay, redeem, purchase,
_________________________
defease or otherwise satisfy prior to the scheduled maturity thereof
in any manner, or make any payment in violation of any subordination
terms of, any Debt, other than (i) the prepayment of the Advances in
accordance with the terms of this Agreement and (ii) in the case of
the Company and any of its Subsidiaries, regularly scheduled or
required repayments or redemptions of Surviving Debt, or amend, modify
or change in any manner any term or condition of any Surviving Debt or
Subordinated Debt, or, from and after the Control Date, permit the
Company or any of its Subsidiaries to do any of the foregoing other
than to prepay any Debt payable to the Borrower.
<PAGE #>
(k) Amendment, Etc. of Related Documents. Cancel or terminate
____________________________________
any Related Document or consent to or accept any cancellation or
termination thereof, amend, modify or change in any manner any term or
condition of any Related Document or give any consent, waiver or
approval thereunder, waive any default under or any breach of any term
or condition of any Related Document, agree in any manner to any other
amendment, modification or change of any term or condition of any
Related Document or take any other action in connection with any
Related Document that would impair the value of the interest or rights
of the Borrower thereunder or that would impair the rights or inter-
ests of the Agent or any Lender, or, from and after the Control Date,
permit the Company or any of its Subsidiaries to do any of the forego-
ing.
(l) Negative Pledge. Enter into or suffer to exist, or, from
_______________
and after the Control Date, permit the Company or any of its Subsidiaries
to enter into or suffer to exist, any agreement prohibiting or conditioning
the creation or assumption of any Lien upon any of its property or assets
other than (i) in favor of the Secured Parties or (ii) in connection with
any Surviving Debt.
(m) Partnerships, Etc. Become a general partner in any general
_________________
or limited partnership or joint venture, or, from and after the
Control Date, permit the Company or any of its Subsidiaries to do so,
other than any Subsidiary the sole assets of which consist of its
interest in such partnership or joint venture.
(n) Speculative Transactions. Engage, or, from and after the
________________________
Control Date, permit the Company or any of its Subsidiaries to
engage, in any transaction involving commodity options or futures
contracts or any similar speculative transactions.
(o) Capital Expenditures. Make, or, from and after the Control
____________________
Date, permit the Company or any of its Subsidiaries to make, any
Capital Expenditures other than, in the case of the Company and any of
its Subsidiaries, Capital Expenditures made in the ordinary course of
business in an aggregate amount not to exceed $2,000,000 from and
after the Control Date.
SECTION 5.03. Reporting Requirements. So long as any Advance
______________________
shall remain unpaid or any Lender shall have any Commitment hereunder, the
Borrower will furnish to the Lenders:
(a) Default Notice. As soon as possible and in any event within
______________
two days after the occurrence of each Default or any event, develop-
ment or occurrence reasonably likely to have a Material Adverse Effect
continuing on the date of such statement, a statement of the chief
financial officer of the Borrower setting forth details of such
Default and the action that the Borrower has taken and proposes to
take with respect thereto.
(b) Quarterly Financials. As soon as available and in any event
____________________
within 45 days after the end of each of the first three quarters of
each Fiscal Year, a Consolidated balance sheet of the Borrower, the
Company and its Subsidiaries as of the end of such quarter and Consol-
idated statement of income and a Consolidated statement of cash flows
of the Borrower, the Company and its Subsidiaries for the period
commencing at the end of the previous fiscal quarter and ending with
the end of such fiscal quarter and a Consolidated statement of income
and a Consolidated statement of cash flows of the Borrower, the
Company and its Subsidiaries for the period commencing at the end of
the previous Fiscal Year and ending with the end of such quarter,
setting forth in each case in comparative form the corresponding
figures for the corresponding period of the preceding Fiscal Year, all
in reasonable detail and duly certified (subject to year-end audit
adjustments) by the chief financial officer of the Borrower as having
been prepared in accordance with GAAP, together with a certificate of
said officer stating that no Default has
<PAGE #>
occurred and is continuing or, if a Default has occurred and is
continuing, a statement as to the nature thereof and the action that
the Borrower has taken and proposes to take with respect thereto.
(c) Annual Financials. As soon as available and in any event
_________________
within 90 days after the end of each Fiscal Year, a copy of the annual
audit report for such year for the Borrower, the Company and its
Subsidiaries, including therein a Consolidated balance sheet of the
Borrower, the Company and its Subsidiaries as of the end of such
Fiscal Year and a Consolidated statement of income and a Consolidated
statement of cash flows of the Borrower and its Subsidiaries for such
Fiscal Year, in each case accompanied by an opinion acceptable to the
Required Lenders of KPMG Peat Marwick LLP or other independent public
accountants of recognized standing acceptable to the Required Lenders,
together with (i) a certificate of such accounting firm to the Lenders
stating that in the course of the regular audit of the business of the
Borrower, the Company and its Subsidiaries, which audit was conducted
by such accounting firm in accordance with generally accepted auditing
standards, such accounting firm has obtained no knowledge that a
Default has occurred and is continuing, or if, in the opinion of such
accounting firm, a Default has occurred and is continuing, a statement
as to the nature thereof and (ii) a certificate of the chief financial
officer of the Borrower stating that no Default has occurred and is
continuing or, if a default has occurred and is continuing, a state-
ment as to the nature thereof and the action that the Borrower has
taken and proposes to take with respect thereto.
(d) ERISA Events and ERISA Reports. Promptly and in any event
______________________________
within 10 days after the Borrower, the Company or any ERISA Affiliate
knows or has reason to know that any ERISA Event has occurred, a
statement of the chief financial officer of the Borrower describing
such ERISA Event and the action, if any, that the Borrower, the
Company or such ERISA Affiliate has taken and proposes to take with
respect thereto and (ii) on the date any records, documents or other
information must be furnished to the PBGC with respect to any Plan
pursuant to Section 4010 of ERISA, a copy of such records, documents
and information.
(e) Plan Terminations. Promptly and in any event within two
_________________
Business Days after receipt thereof by the Borrower, the Company or
any ERISA Affiliate, copies of each notice from the PBGC stating its
intention to terminate any Plan or to have a trustee appointed to
administer any Plan.
(f) Actuarial Reports. Promptly upon receipt thereof by the
_________________
Borrower, the Company or any ERISA Affiliate, a copy of the annual
actuarial valuation report for each Plan the funded current liability
percentage (as defined in Section 302(d)(8) of ERISA) of which is less
than 90% or the unfunded current liability of which exceeds
$1,000,000.
(g) Plan Annual Reports. Promptly and in any event within 30
___________________
days after the filing thereof with the Internal Revenue Service,
copies of each Schedule B (Actuarial Information) to the annual report
(Form 5500 Series) with respect to each Plan.
(h) Multiemployer Plan Notices. Promptly and in any event
__________________________
within five Business Days after receipt thereof by the Borrower, the
Company or any ERISA Affiliate from the sponsor of a Multiemployer
Plan, copies of each notice concerning (i) the imposition of Withdraw-
al Liability by any such Multiemployer Plan, (ii) the reorganization
or termination, within the meaning of Title IV of ERISA, of any such
Multiemployer Plan or (iii) the amount of liability incurred, or that
may be incurred, by the Borrower, the Company or any ERISA Affiliate
in connection with any event described in clause (i) or (ii).
<PAGE #>
(i) Litigation. Promptly after the commencement thereof, notice
__________
of all actions, suits, investigations, litigation and proceedings
before any court or governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, affecting
Holdings, the Borrower, the Company or any of their respective Subsid-
iaries of the type described in Section 4.01(j).
(j) Securities Reports. Promptly after the sending or filing
__________________
thereof, copies of all proxy statements, financial statements and
reports that Holdings, the Borrower, the Company or any of their
respective Subsidiaries sends to its stockholders, and copies of all
regular, periodic and special reports, and all registration state-
ments, that Holdings, the Borrower, the Company or any of their
respective Subsidiaries files with the Securities and Exchange Commis-
sion or any governmental authority that may be substituted therefor,
or with any national securities exchange.
(k) Creditor Reports. Promptly after the furnishing thereof,
________________
copies of any statement or report furnished to any other holder of the
securities of Holdings, the Borrower, the Company or any of their
respective Subsidiaries pursuant to the terms of any indenture, loan
or credit or similar agreement and not otherwise required to be
furnished to the Lenders pursuant to any other clause of this Sec-
tion 5.03.
(l) Agreement Notices. Promptly upon receipt thereof, copies of
_________________
all notices, requests and other documents received by Holdings, the
Borrower, the Company or any of their respective Subsidiaries under or
pursuant to any Related Document or indenture, loan or credit or
similar agreement and, from time to time upon request by the Agent,
such information and reports regarding the Related Documents as the
Agent may reasonably request.
(m) Revenue Agent Reports. Within 10 days after receipt, copies
_____________________
of all Revenue Agent Reports (Internal Revenue Service Form 886), or
other written proposals of the Internal Revenue Service, that propose,
determine or otherwise set forth positive adjustments to the Federal
income tax liability of the affiliated group (within the meaning of
Section 1504(a)(1) of the Internal Revenue Code) of which the Company
is a member aggregating $1,000,000 or more.
(n) Tax Certificates. Promptly, and in any event within five
________________
Business Days after the due date (with extensions) for filing the
final Federal income tax return in respect of each taxable year, a
certificate (a "Tax Certificate"), signed by the President or the
_______________
chief financial officer of the Borrower, stating that the affiliated
group (within the meaning of Section 1504(a)(1) of the Internal
Revenue Code) of which the Company is a member has paid to the Inter-
nal Revenue Service or other taxing authority, or to the Borrower, the
full amount that such affiliated group is required to pay in respect
of Federal income tax for such year.
(o) Environmental Conditions. Promptly after the assertion or
________________________
occurrence thereof, notice of any Environmental Action against or of
any noncompliance by Holdings, the Borrower, the Company or any of
their respective Subsidiaries with any Environmental Law or Environ-
mental Permit that could reasonably be expected to have a Material
Adverse Effect.
(p) Other Information. Such other information respecting the
_________________
business, condition (financial or otherwise), operations, performance,
properties or prospects of Holdings, the Borrower, the Company or any
of their respective Subsidiaries as any Lender (through the Agent) may
from time to time reasonably request.
<PAGE #>
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following events
_________________
("Events of Default") shall occur and be continuing:
_________________
(a) (i) the Borrower shall fail to pay any principal of any
Advance when the same shall become due and payable or (ii) the Borrow-
er shall fail to pay any interest on any Advance, or any Loan Party
shall fail to make any other payment under any Loan Document, in each
case under this clause (ii) within 3 Business Days after the same
becomes due and payable; or
(b) any representation or warranty made by any Loan Party (or
any of its officers) under or in connection with any Loan Document
shall prove to have been incorrect in any material respect when made;
or
(c) the Borrower shall fail to perform or observe any term,
covenant or agreement contained in Section 2.13, 5.01(e), (f), (g) or
(l), 5.02 or 5.03; or
(d) any Loan Party shall fail to perform any other term, cove-
nant or agreement contained in any Loan Document on its part to be
performed or observed if such failure shall remain unremedied for 10
days after the earlier of the date on which (A) a Responsible Officer
of the Borrower becomes aware of such failure or (B) written notice
thereof shall have been given to the Borrower by the Agent or any
Lender; or
(e) any of Welsh Carson, any other Loan Party or any of such
other Loan Party's Subsidiaries shall fail to pay any principal of,
premium or interest on or any other amount payable in respect of any
Debt that is outstanding in a principal or notional amount of at least
$5,000,000 either individually or in the aggregate (but excluding Debt
outstanding hereunder) of such Loan Party or such Subsidiary (as the
case may be), when the same becomes due and payable (whether by
scheduled maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument relating to
such Debt; or any other event shall occur or condition shall exist
under any agreement or instrument relating to any such Debt and shall
continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such event or condition is
to accelerate, or to permit the acceleration of, the maturity of such
Debt or otherwise to cause, or to permit the holder thereof to cause,
such Debt to mature; or any such Debt shall be declared to be due and
payable or required to be prepaid or redeemed (other than by a regu-
larly scheduled required prepayment or redemption), purchased or
defeased, or an offer to prepay, redeem, purchase or defease such Debt
shall be required to be made, in each case prior to the stated maturi-
ty thereof; or
(f) any of Welsh Carson, any other Loan Party or any of such
other Loan Party's Subsidiaries shall generally not pay its debts as
such debts become due, or shall admit in writing its inability to pay
its debts generally, or shall make a general assignment for the
benefit of creditors; or any proceeding shall be instituted by or
against any of Welsh Carson, any other Loan Party or any of such other
Loan Party's Subsidiaries seeking to adjudicate it a bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, ar-
rangement, adjustment, protection, relief, or composition of it or its
debts under any law relating to bankruptcy, insolvency or reorganiza-
tion or relief of debtors, or seeking the entry of an order for relief
or the appointment
<PAGE #>
of a receiver, trustee, or other similar official for it or for any
substantial part of its property and, in the case of any such proceed-
ing instituted against it (but not instituted by it) that is being
diligently contested by it in good faith, either such proceeding shall
remain undismissed or unstayed for a period of 30 days or any of the
actions sought in such proceeding (including, without limitation, the
entry of an order for relief against, or the appointment of a receiv-
er, trustee, custodian or other similar official for, it or any
substantial part of its property) shall occur; or of Welsh Carson, any
other Loan Party or any of such other Loan Party's Subsidiaries shall
take any corporate action to authorize any of the actions set forth
above in this subsection (f); or
(g) any judgment or order for the payment of money in excess of
$5,000,000 shall be rendered against any of Welsh Carson, any other
Loan Party or any of such other Loan Party's Subsidiaries and either
(i) enforcement proceedings shall have been commenced by any creditor
upon such judgment or order or (ii) there shall be any period of 10
consecutive days during which a stay of enforcement of such judgment
or order, by reason of a pending appeal or otherwise, shall not be in
effect; or
(h) any non-monetary judgment or order shall be rendered against
Welsh Carson, any other Loan Party or any of such other Loan Party's
Subsidiaries that could be reasonably likely to have a Material
Adverse Effect, and there shall be any period of 10 consecutive days
during which a stay of enforcement of such judgment or order, by
reason of a pending appeal or otherwise, shall not be in effect; or
(i) any provision of any Loan Document after delivery thereof
pursuant to Section 3.01 shall for any reason cease to be valid and
binding on or enforceable against any Loan Party party to it, or any
such Loan Party shall so state in writing; or
(j) any Collateral Document after delivery thereof pursuant to
Section 3.01 shall for any reason (other than pursuant to the terms
thereof) cease to create a valid and perfected first priority lien on
and security interest in the Collateral purported to be covered
thereby; or
(k) (i) the Equity Investors shall at any time for any reason
cease to be the direct or indirect legal and beneficial owners of at
least 51% of the outstanding Voting Stock of Holdings and the Company;
or (ii) during any period of up to 24 consecutive months, commencing
after the date of this Agreement, individuals who at the beginning of
such 24-month period were directors of Holdings or the Company or
other individuals subsequently designated by the Equity Investors
shall cease for any reason to constitute a majority of the board of
directors of Holdings or the Company; or (iii) any Person or two or
more Persons acting in concert, other than the Equity Investors, shall
have acquired by contract or otherwise, or shall have entered into a
contract or arrangement that, upon consummation, will result in its or
their acquisition of the power to exercise, directly or indirectly, a
controlling influence over the management or policies of Holdings or
the Company; or (iv) Holdings shall cease to be the legal and benefi-
cial owner of all of the outstanding capital stock of the Borrower; or
(l) any ERISA Event shall have occurred with respect to a Plan
and the sum (determined as of the date of occurrence of such ERISA
Event) of the Insufficiency of such Plan and the Insufficiency of any
and all other Plans with respect to which an ERISA Event shall have
occurred and then exist (or the liability of the Loan Parties and the
ERISA Affiliates related to such ERISA Event) exceeds $5,000,000; or
<PAGE #>
(m) any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred
Withdrawal Liability to such Multiemployer Plan in an amount that,
when aggregated with all other amounts required to be paid to
Multiemployer Plans by the Loan Parties and the ERISA Affiliates as
Withdrawal Liability (determined as of the date of such notification),
exceeds $5,000,000 or requires payments exceeding $1,000,000 per
annum; or
(n) any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that such
Multiemployer Plan is in reorganization or is being terminated, within
the meaning of Title IV of ERISA, and as a result of such reorganiza-
tion or termination the aggregate annual contributions of the Loan
Parties and the ERISA Affiliates to all Multiemployer Plans that are
then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for
the plan years of such Multiemployer Plans immediately preceding the
plan year in which such reorganization or termination occurs by an
amount exceeding $1,000,000;
then, and in any such event, the Agent (i) shall at the request, or may
with the consent, of the Required Lenders, by notice to the Borrower,
declare the obligation of each Lender to make Advances, whereupon the same
shall forthwith terminate, and (ii) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Borrower, declare the
Notes, all interest thereon and all other amounts payable under this
Agreement and the other Loan Documents to be forthwith due and payable,
whereupon the Notes, all such interest and all such amounts shall become
and be forthwith due and payable, without presentment, demand, protest or
further notice of any kind, all of which are hereby expressly waived by the
Borrower; provided, however, that in the event of an actual or deemed entry
________ _______
of an order for relief with respect to any Loan Party or any of its
Subsidiaries under the Federal Bankruptcy Code, (x) the obligation of each
Lender to make Advances shall automatically be terminated and (y) the
Notes, all such interest and all such amounts shall automatically become
and be due and payable, without presentment, demand, protest or any notice
of any kind, all of which are hereby expressly waived by the Borrower.
ARTICLE VII
THE AGENT
SECTION 7.01. Authorization and Action. Each Lender hereby
________________________
appoints and authorizes the Agent to take such action as agent on its
behalf and to exercise such powers and discretion under this Agreement and
the other Loan Documents as are delegated to the Agent by the terms hereof
and thereof, together with such powers and discretion as are reasonably
incidental thereto. As to any matters not expressly provided for by the
Loan Documents (including, without limitation, enforcement or collection of
the Notes), the Agent shall not be required to exercise any discretion or
take any action, but shall be required to act or to refrain from acting
(and shall be fully protected in so acting or refraining from acting) upon
the instructions of the Required Lenders, and such instructions shall be
binding upon all Lenders and all holders of Notes; provided, however, that
________ _______
the Agent shall not be required to take any action that exposes the Agent
to personal liability or that is contrary to this Agreement or applicable
law. The Agent agrees to give to each Lender prompt notice of each notice
given to it by the Borrower pursuant to the terms of this Agreement. The
Documentation Agent, as such, shall have no such duties or responsibilities
hereunder.
SECTION 7.02. Agent's Reliance, Etc. Neither the Agent nor any
_____________________
of its directors, officers, agents or employees shall be liable for any
action taken or omitted to be taken by it or them under or in connection
with the Loan Documents, except for its or their own gross negligence or
willful
<PAGE #>
misconduct. Without limitation of the generality of the foregoing, the
Agent: (a) may treat the payee of any Note as the holder thereof until the
Agent receives and accepts an Assignment and Acceptance entered into by the
Lender that is the payee of such Note, as assignor, and an Eligible
Assignee, as assignee, as provided in Section 8.07; (b) may consult with
legal counsel (including counsel for any Loan Party), independent public
accountants and other experts selected by it and shall not be liable for
any action taken or omitted to be taken in good faith by it in accordance
with the advice of such counsel, accountants or experts; (c) makes no
warranty or representation to any Lender and shall not be responsible to
any Lender for any statements, warranties or representations (whether
written or oral) made in or in connection with the Loan Documents;
(d) shall not have any duty to ascertain or to inquire as to the perfor-
mance or observance of any of the terms, covenants or conditions of any
Loan Document on the part of any Loan Party or to inspect the property
(including the books and records) of any Loan Party; (e) shall not be
responsible to any Lender for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be
created under or in connection with, any Loan Document or any other
instrument or document furnished pursuant thereto; and (f) shall incur no
liability under or in respect of any Loan Document by acting upon any
notice, consent, certificate or other instrument or writing (which may be
by telegram, telecopy or telex) believed by it to be genuine and signed or
sent by the proper party or parties.
SECTION 7.03. NationsBank and Affiliates. With respect to its
__________________________
Commitments, the Advances made by it and the Notes issued to it,
NationsBank shall have the same rights and powers under the Loan Documents
as any other Lender and may exercise the same as though it were not the
Agent; and the term "Lender" or "Lenders Parties" shall, unless otherwise
expressly indicated, include NationsBank in its individual capacity.
NationsBank and its affiliates may accept deposits from, lend money to, act
as trustee under indentures of, accept investment banking engagements from
and generally engage in any kind of business with, any Loan Party, any of
its Subsidiaries and any Person who may do business with or own securities
of any Loan Party or any such Subsidiary, all as if NationsBank were not
the Agent and without any duty to account therefor to the Lenders.
SECTION 7.04. Lender Credit Decision. Each Lender acknowledges
______________________
that it has, independently and without reliance upon the Agent or any other
Lender and based on the financial statements referred to in Section 4.01
and such other documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement. Each
Lender also acknowledges that it will, independently and without reliance
upon the Agent or any other Lender and based on such documents and informa-
tion as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement.
SECTION 7.05. Indemnification. Each Lender severally agrees to
_______________
indemnify the Agent (to the extent not promptly reimbursed by the Borrower)
from and against such Lender's ratable share (determined as provided below)
of any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by, or asserted against
the Agent in any way relating to or arising out of the Loan Documents or
any action taken or omitted by the Agent under the Loan Documents; provid-
_______
ed, however, that no Lender shall be liable for any portion of such
__ _______
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the Agent's gross
negligence or willful misconduct. Without limitation of the foregoing,
each Lender agrees to reimburse the Agent promptly upon demand for its
ratable share of any costs and expenses (including, without limitation,
fees and expenses of counsel) payable by the Borrower under Section 8.04,
to the extent that the Agent is not promptly reimbursed for such costs and
expenses by the Borrower. For purposes of this Section 7.05, the Lenders'
respective ratable shares of any amount shall be determined, at any time,
according to the sum of (a) the aggregate principal amount of the Advances
outstanding at such time and owing to the respective
<PAGE #>
Lenders and (b) the aggregate unused portions of their respective Term A
Commitments and Term B Commitments at such time. In the event that any
Defaulted Advance shall be owing by any Defaulting Lender at any time, such
Lender's Commitment with respect to the Facility under which such Defaulted
Advance was required to have been made shall be considered to be unused for
purposes of this Section 7.05 to the extent of the amount of such Defaulted
Advance. The failure of any Lender to reimburse the Agent promptly upon
demand for its ratable share of any amount required to be paid by the
Lender to the Agent as provided herein shall not relieve any other Lender
of its obligation hereunder to reimburse the Agent for its ratable share of
such amount, but no Lender shall be responsible for the failure of any
other Lender to reimburse the Agent for such other Lender's ratable share
of such amount. Without prejudice to the survival of any other agreement
of any Lender hereunder, the agreement and obligations of each Lender
contained in this Section 7.05 shall survive the payment in full of
principal, interest and all other amounts payable hereunder and under the
other Loan Documents.
SECTION 7.06. Successor Agents. The Agent may resign at any
________________
time by giving written notice thereof to the Lenders and the Borrower and
may be removed at any time with or without cause by the Required Lenders.
Upon any such resignation or removal, the Required Lenders shall have the
right to appoint a successor Agent. If no successor Agent shall have been
so appointed by the Required Lenders, and shall have accepted such appoint-
ment, within 30 days after the retiring Agent's giving of notice of
resignation or the Required Lenders' removal of the retiring Agent, then
the retiring Agent may, on behalf of the Lenders, appoint a successor
Agent, which shall be a commercial bank organized under the laws of the
United States or of any State thereof and having a combined capital and
surplus of at least $500,000,000. Upon the acceptance of any appointment
as Agent hereunder by a successor Agent and upon the execution and filing
or recording of such financing statements, or amendments thereto, and such
other instruments or notices, as may be necessary or desirable, or as the
Required Lenders may request, in order to continue the perfection of the
Liens granted or purported to be granted by the Collateral Documents, such
successor Agent shall succeed to and become vested with all the rights,
powers, discretion, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations under
the Loan Documents. After any retiring Agent's resignation or removal
hereunder as Agent, the provisions of this Article VII shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Agent under this Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc. No amendment or waiver of any
_______________
provision of this Agreement or the Notes or any other Loan Document, nor
consent to any departure by the Borrower therefrom, shall in any event be
effective unless the same shall be in writing and signed (or, in the case
of the Collateral Documents, consented to) by the Required Lenders, and
then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; provided, however,
________ _______
that no amendment, waiver or consent shall, unless in writing and signed by
all of the Lenders (other than any Lender that is, at such time, a Default-
ing Lender), do any of the following at any time: (i) waive any of the
conditions specified in Section 3.01 or, in the case of the Initial
Extension of Credit, Section 3.02, (ii) change the number of Lenders or the
percentage of (x) the Commitments, or (y) the aggregate unpaid principal
amount of the Advances that, in each case, shall be required for the
Lenders or any of them to take any action hereunder, (iii) reduce or limit
the obligations of either Guarantor under Section 1 of the Guaranties or
otherwise limit the Guarantors' liability with respect to the Obligations
owing to the Agent and the Lenders, (iv) release any material portion of
the Collateral in any transaction or series of related transactions or
permit the creation, incurrence, assumption or existence of any Lien on any
material
<PAGE #>
portion of the Collateral in any transaction or series of related transac-
tions to secure any Obligations other than Obligations owing to the Secured
Parties under the Loan Documents and other than Debt owing to any other
Person, provided that, in the case of any Lien on any material portion of
________
the Collateral to secure Debt owing to any other Person, (A) the Borrower
shall, on the date such Debt shall be incurred or issued, prepay the
Advances pursuant to, and in the order of priority set forth in, Sec-
tion 2.05(b)(i) in an aggregate principal amount equal to the amount of
such Net Cash Proceeds to the extent required to do so under Section
2.05(b)(i), (B) such Lien shall be subordinated to the Liens created under
the Loan Documents on terms acceptable to the Required Lenders and (C) the
Required Lenders shall otherwise permit the creation, incurrence, assump-
tion or existence of such Lien and, to the extent not otherwise permitted
under Section 5.02(b), of such Debt, (v) amend this Section 8.01,
(vi) increase the Commitments of the Lenders or subject the Lenders to any
additional obligations, (vii) reduce the principal of, or interest on, the
Notes or any fees or other amounts payable hereunder, (viii) postpone any
date fixed for any payment of principal of, or interest on, the Notes or
any fees or other amounts payable hereunder, or (ix) limit the liability of
any Loan Party under any of the Loan Documents; and provided further that
________ _______
no amendment, waiver or consent shall, unless in writing and signed by the
Agent in addition to the Lenders required above to take such action, affect
the rights or duties of the Agent under this Agreement.
SECTION 8.02. Notices, Etc. All notices and other communica-
____________
tions provided for hereunder shall be in writing (including telegraphic,
telecopy or telex communication) and mailed, telegraphed, telecopied,
telexed or delivered, if to the Borrower, at its address at c/o Welsh,
Carson, Anderson & Stowe VII L.P., 320 Park Avenue, Suite 2500, New York,
NY 10022 Attention: Patrick J. Welsh; if to any Initial Lender, at its
Domestic Lending Office specified opposite its name on Schedule I hereto;
if to any other Lender, at its Domestic Lending Office specified in the
Assignment and Acceptance pursuant to which it became a Lender; and if to
the Agent, at its address at 901 Main Street, 14th Floor, Dallas, Texas
75202, Attention: Gilda Digges; or, as to the Borrower or the Agent, at
such other address as shall be designated by such party in a written notice
to the other parties and, as to each other party, at such other address as
shall be designated by such party in a written notice to the Borrower and
the Agent. All such notices and communications shall, when mailed,
telegraphed, telecopied or telexed, be effective when deposited in the
mails, delivered to the telegraph company, transmitted by telecopier or
confirmed by telex answerback, respectively, except that notices and
communications to the Agent pursuant to Article II, III or VII shall not be
effective until received by the Agent. Delivery by telecopier of an
executed counterpart of any amendment or waiver of any provision of this
Agreement or the Notes or of any Exhibit hereto to be executed and deliv-
ered hereunder shall be effective as delivery of a manually executed
counterpart thereof.
SECTION 8.03. No Waiver; Remedies. No failure on the part of
___________________
any Lender or the Agent to exercise, and no delay in exercising, any right
hereunder or under any Note shall operate as a waiver thereof; nor shall
any single or partial exercise of any such right preclude any other or
further exercise thereof or the exercise of any other right. The remedies
herein provided are cumulative and not exclusive of any remedies provided
by law.
SECTION 8.04. Costs and Expenses. (a) The Borrower agrees to
__________________
pay on demand (i) all costs and expenses of the Agent and, in the case of
clause (A), the Documentation Agent in connection with the preparation,
execution, delivery, administration, modification and amendment of the Loan
Documents (including, without limitation, (A) all due diligence, collateral
review, syndication, transportation, computer, duplication, appraisal,
audit, insurance, consultant, search, filing and recording fees and
expenses and (B) the reasonable fees and expenses of counsel for the Agent
with respect thereto, with respect to advising the Agent as to its rights
and responsibilities, or the perfection, protection or preservation of
rights or interests, under the Loan Documents, with respect to negotiations
with any Loan Party or with other creditors of any Loan Party or any of its
Subsidiaries arising out of any Default or any
<PAGE #>
events or circumstances that may give rise to a Default and with respect to
presenting claims in or otherwise participating in or monitoring any
bankruptcy, insolvency or other similar proceeding involving creditors'
rights generally and any proceeding ancillary thereto) and (ii) all costs
and expenses of the Agent and the Lenders in connection with the enforce-
ment of the Loan Documents, whether in any action, suit or litigation, any
bankruptcy, insolvency or other similar proceeding affecting creditors'
rights generally (including, without limitation, the reasonable fees and
expenses of counsel for the Agent and each Lender with respect thereto).
(b) The Borrower agrees to indemnify and hold harmless the
Agent, each Lender and each of their Affiliates and their officers,
directors, employees, agents and advisors (each, an "Indemnified Party")
_________________
from and against any and all claims, damages, losses, liabilities and
expenses (including, without limitation, reasonable fees and expenses of
counsel) that may be incurred by or asserted or awarded against any
Indemnified Party, in each case arising out of or in connection with or by
reason of (including, without limitation, in connection with any investiga-
tion, litigation or proceeding or preparation of a defense in connection
therewith) (i) the Facilities, the actual or proposed use of the proceeds
of the Advances, the Loan Documents or any of the transactions contemplated
thereby, including, without limitation, any acquisition or proposed
acquisition (including, without limitation, the Tender Offer and the Merger
and any of the other transactions contemplated hereby) by the Equity
Investors or any of their Subsidiaries or Affiliates of all or any portion
of the stock or substantially all the assets of the Company or any of its
Subsidiaries or (ii) the actual or alleged presence of Hazardous Materials
on any property of any Loan Party or any of its Subsidiaries or any
Environmental Action relating in any way to any Loan Party or any of its
Subsidiaries, except to the extent such claim, damage, loss, liability or
expense is found in a final, non-appealable judgment by a court of compe-
tent jurisdiction to have resulted from such Indemnified Party's gross
negligence or willful misconduct. In the case of any investigation,
litigation or other proceeding to which the indemnity in this Section
8.04(b) applies, such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by any Loan Party, its
directors, shareholders or creditors or an Indemnified Party or any
Indemnified Party is otherwise a party thereto and whether or not the
transactions contemplated hereby are consummated. The Borrower also agrees
not to assert any claim against the Agent, any Lender or any of their
Affiliates, or any of their respective officers, directors, employees,
attorneys and agents, on any theory of liability, for special, indirect,
consequential or punitive damages arising out of or otherwise relating to
the Facilities, the actual or proposed use of the proceeds of the Advances,
the Loan Documents or any of the transactions contemplated thereby.
(c) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made by the Borrower to or for the account of a
Lender other than on the last day of the Interest Period for such Advance,
as a result of a payment or Conversion pursuant to Section 2.08(b)(i) or
2.09(d), acceleration of the maturity of the Notes pursuant to Section 6.01
or for any other reason, the Borrower shall, upon demand by such Lender
(with a copy of such demand to the Agent), pay to the Agent for the account
of such Lender any amounts required to compensate such Lender for any
additional losses, costs or expenses that it may reasonably incur as a
result of such payment, including, without limitation, any loss (including
loss of anticipated profits), cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by any
Lender to fund or maintain such Advance.
(d) If any Loan Party fails to pay when due any costs, expenses
or other amounts payable by it under any Loan Document, including, without
limitation, fees and expenses of counsel and indemnities, such amount may
be paid on behalf of such Loan Party by the Agent or any Lender, in its
sole discretion.
<PAGE #>
(e) Without prejudice to the survival of any other agreement of
any Loan Party hereunder or under any other Loan Document, the agreements
and obligations of the Borrower contained in Sections 2.09 and 2.11 and
this Section 8.04 shall survive the payment in full of principal, interest
and all other amounts payable hereunder and under any of the other Loan
Documents.
SECTION 8.05. Right of Set-off. Upon (a) the occurrence and
________________
during the continuance of any Event of Default and (b) the making of the
request or the granting of the consent specified by Section 6.01 to
authorize the Agent to declare the Notes due and payable pursuant to the
provisions of Section 6.01, each Lender and each of its respective Affili-
ates is hereby authorized at any time and from time to time, to the fullest
extent permitted by law, to set off and otherwise apply any and all
deposits (general or special, time or demand, provisional or final) at any
time held and other indebtedness at any time owing by such Lender or such
Affiliate to or for the credit or the account of the Borrower against any
and all of the Obligations of the Borrower now or hereafter existing under
this Agreement and the Note or Notes (if any) held by such Lender, irre-
spective of whether such Lender shall have made any demand under this
Agreement or such Note or Notes and although such obligations may be
unmatured. Each Lender agrees promptly to notify the Borrower after any
such set-off and application; provided, however, that the failure to give
________ _______
such notice shall not affect the validity of such set-off and application.
The rights of each Lender and its respective Affiliates under this Section
are in addition to other rights and remedies (including, without limita-
tion, other rights of set-off) that such Lender and its respective Affili-
ates may have.
SECTION 8.06. Binding Effect. This Agreement shall become
______________
effective when it shall have been executed by the Borrower and the Agent
and when the Agent shall have been notified by each Initial Lender that
such Initial Lender has executed it and thereafter shall be binding upon
and inure to the benefit of the Borrower, the Agent and each Lender and
their respective successors and assigns, except that the Borrower shall not
have the right to assign its rights hereunder or any interest herein
without the prior written consent of the Lenders.
SECTION 8.07. Assignments and Participations. (a) Each Lender
______________________________
may assign to one or more Eligible Assignees all or a portion of its rights
and obligations under this Agreement (including, without limitation, all or
a portion of its Commitment or Commitments, the Advances owing to it and
the Note or Notes held by it); provided, however, that (i) each such
________ _______
assignment shall be of a uniform, and not a varying, percentage of all
rights and obligations under and in respect of all of the Facilities,
(ii) except in the case of an assignment to a Person that, immediately
prior to such assignment, was a Lender or an assignment of all of a
Lender's rights and obligations under this Agreement, the amount of the
Commitment of the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $5,000,000,
(iii) each such assignment shall be to an Eligible Assignee, and (iv) the
parties to each such assignment shall execute and deliver to the Agent, for
its acceptance and recording in the Register, an Assignment and Acceptance,
together with any Note or Notes subject to such assignment and a processing
and recordation fee of $3,500.
(b) Upon such execution, delivery, acceptance and recording,
from and after the effective date specified in such Assignment and Accep-
tance, (x) the assignee thereunder shall be a party hereto and, to the
extent that rights and obligations hereunder have been assigned to it
pursuant to such Assignment and Acceptance, have the rights and obligations
of a Lender hereunder and (y) the Lender assignor thereunder shall, to the
extent that rights and obligations hereunder have been assigned by it
pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining
<PAGE #>
portion of an assigning Lender's rights and obligations under this Agree-
ment, such Lender shall cease to be a party hereto).
(c) By executing and delivering an Assignment and Acceptance,
the Lender assignor thereunder and the assignee thereunder confirm to and
agree with each other and the other parties hereto as follows: (i) other
than as provided in such Assignment and Acceptance, such assigning Lender
makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with this Agreement or any other Loan Document or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of,
or the perfection or priority of any lien or security interest created or
purported to be created under or in connection with, this Agreement or any
other Loan Document or any other instrument or document furnished pursuant
hereto or thereto; (ii) such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to the financial
condition of the Borrower or any other Loan Party or the performance or
observance by any Loan Party of any of its obligations under any Loan
Document or any other instrument or document furnished pursuant thereto;
(iii) such assignee confirms that it has received a copy of this Agreement,
together with copies of the financial statements referred to in
Section 4.01 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and
without reliance upon the Agent, such assigning Lender or any other Lender
and based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or not taking
action under this Agreement; (v) such assignee confirms that it is an
Eligible Assignee; (vi) such assignee appoints and authorizes the Agent to
take such action as agent on its behalf and to exercise such powers and
discretion under the Loan Documents as are delegated to the Agent by the
terms hereof, together with such powers and discretion as are reasonably
incidental thereto; and (vii) such assignee agrees that it will perform in
accordance with their terms all of the obligations which by the terms of
this Agreement are required to be performed by it as a Lender.
(d) The Agent shall maintain at its address referred to in
Section 8.02 a copy of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation of the names and address-
es of the Lenders and the Commitment of, and principal amount of the
Advances owing to, each Lender from time to time (the "Register"). The
________
entries in the Register shall be conclusive and binding for all purposes,
absent manifest error, and the Borrower, the Agent and the Lenders may
treat each Person whose name is recorded in the Register as a Lender
hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any Lender at any reasonable
time and from time to time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by
an assigning Lender and an assignee, together with any Note or Notes
subject to such assignment, the Agent shall, if such Assignment and
Acceptance has been completed and is in substantially the form of Exhibit C
hereto, (i) accept such Assignment and Acceptance, (ii) record the informa-
tion contained therein in the Register and (iii) give prompt notice thereof
to the Borrower. Within five Business Days after its receipt of such
notice, the Borrower, at its own expense, shall execute and deliver to the
Agent in exchange for the surrendered Note or Notes a new Note to the order
of such Eligible Assignee in an amount equal to the Commitment assumed by
it pursuant to such Assignment and Acceptance and, if the assigning Lender
has retained a Commitment hereunder, a new Note to the order of the
assigning Lender in an amount equal to the Commitment retained by it
hereunder. Such new Note or Notes shall be in an aggregate principal
amount equal to the aggregate principal amount of such surrendered Note or
Notes, shall be dated the effective date of such Assignment and Acceptance
and shall otherwise be in substantially the form of Exhibit A-1 or A-2
hereto, as the case may be.
<PAGE #>
(f) Each Lender may sell participations to one or more Persons
(other than any Loan Party or any of its Affiliates) in or to all or a
portion of its rights and obligations under this Agreement (including,
without limitation, all or a portion of its Commitments, the Advances owing
to it and the Note or Notes (if any) held by it); provided, however, that
________ _______
(i) such Lender's obligations under this Agreement (including, without
limitation, its Commitments) shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance
of such obligations, (iii) such Lender shall remain the holder of any such
Note for all purposes of this Agreement, (iv) the Borrower, the Agent and
the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement and (v) no participant under any such participation shall have
any right to approve any amendment or waiver of any provision of any Loan
Document, or any consent to any departure by any Loan Party therefrom,
except to the extent that such amendment, waiver or consent would reduce
the principal of, or interest on, the Notes or any fees or other amounts
payable hereunder, in each case to the extent subject to such participa-
tion, postpone any date fixed for any payment of principal of, or interest
on, the Notes or any fees or other amounts payable hereunder, in each case
to the extent subject to such participation, or release all or substantial-
ly all of the Collateral.
(g) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this
Section 8.07, disclose to the assignee or participant or proposed assignee
or participant, any information relating to the Borrower furnished to such
Lender by or on behalf of the Borrower; provided, however, that, prior to
________ _______
any such disclosure, the assignee or participant or proposed assignee or
participant shall agree to preserve the confidentiality of any Confidential
Information received by it from such Lender.
(h) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time create a security interest in all or
any portion of its rights under this Agreement (including, without limita-
tion, the Advances owing to it and the Note or Notes held by it) in favor
of any Federal Reserve Bank in accordance with Regulation A of the Board of
Governors of the Federal Reserve System.
SECTION 8.08. Execution in Counterparts. This Agreement may be
_________________________
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be
an original and all of which taken together shall constitute one and the
same agreement. Delivery of an executed counterpart of a signature page to
this Agreement by telecopier shall be effective as delivery of a manually
executed counterpart of this Agreement.
SECTION 8.9. Confidentiality. Neither the Agent nor any Lender
_______________
shall disclose any Confidential Information to any Person without the
consent of the Borrower, other than (a) to the Agent's or such Lender's
Affiliates and their officers, directors, employees, agents and advisors
and to actual or prospective Eligible Assignees and participants, and then
only on a confidential basis, (b) as required by any law, rule or regula-
tion or judicial process and (c) as requested or required by any state,
federal or foreign authority or examiner regulating banks or banking.
SECTION 8.10. Jurisdiction, Etc. (a) Each of the parties
_________________
hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
federal court of the United States of America sitting in New York City, and
any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Agreement or any of the other Loan Documents to
which it is a party, or for recognition or enforcement of any judgment, and
each of the parties hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard
and determined in any such New York State court or, to the extent permitted
by law, in such federal court. Each of the parties hereto agrees that a
final judgment in any such action or proceeding shall be conclusive and may
be enforced in other jurisdictions by suit on the
<PAGE #>
judgment or in any other manner provided by law. Nothing in this Agreement
shall affect any right that any party may otherwise have to bring any
action or proceeding relating to this Agreement or any of the other Loan
Documents in the courts of any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any
suit, action or proceeding arising out of or relating to this Agreement or
any of the other Loan Documents to which it is a party in any New York
State or federal court. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconve-
nient forum to the maintenance of such action or proceeding in any such
court.
SECTION 8.11. Governing Law. This Agreement and the Notes shall
_____________
be governed by, and construed in accordance with, the laws of the State of
New York.
<PAGE>
<PAGE #>
SECTION 8.12. Waiver of Jury Trial. Each of the Borrower, the
____________________
Agent and the Lenders irrevocably waives all right to trial by jury in any
action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to any of the Loan Documents, the
Advances or the actions of the Agent or any Lender in the negotiation,
administration, performance or enforcement thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their respective officers thereunto duly authorized, as
of the date first above written.
CDSI ACQUISITION CORP.
By
Title:
NATIONSBANK OF TEXAS, N.A., as Agent
By
Title:
THE BANK OF NOVA SCOTIA,
as Documentation Agent
By
Title:
Initial Lenders
NATIONSBANK OF TEXAS, N.A.
By
Title:
THE BANK OF NOVA SCOTIA
By
Title:
Exhibit (a)(13)
Georgeson & Company Inc.
From: CDSI Holding Corporation
c/o Welsh, Carson, Anderson & Stowe
320 Park Avenue
New York, New York 10022
For Release: Immediately
Contact: Tony Vecchio
Georgeson & Company Inc.
(212) 440-9800
CDSI Acquisition Corp. Completes Tender Offer For
_________________________________________________
Control Data Systems, Inc.
__________________________
New York, New York, August 12 -- CDSI Holding Corporation, a
corporation formed at the direction of Welsh, Carson, Anderson & Stowe
(WCAS), announced today that its wholly-owned subsidiary, CDSI Acquisition
Corp., has completed its cash tender offer for all outstanding shares of
common stock of Control Data Systems, Inc. (NASDAQ: CDAT), at a price of
$20.25 per share.
CDSI Holdings stated that 11,255,901 shares of Control Data
Systems' common stock, or approximately 89% of the presently outstanding
common stock, or 79% of the fully diluted common stock (including 835,028
shares that were subject to guarantees of delivery) had been tendered
pursuant to the offer, which expired at midnight, New York City time, on
August 11, 1997, and that all such shares had been or will be purchased in
accordance with the terms of the offer. The offer is being financed by the
sale of equity and debt securities to certain investment funds and related
persons affiliated with WCAS and a credit facility provided by NationsBank
of Texas, N.A. and The Bank of Nova Scotia.
Pursuant to the terms of the Merger Agreement under which the
offer was made, all shares of Control Data Systems common stock not
tendered and purchased in the offer will be acquired in a second step
merger transaction at the same price of $20.25 per share.
Control Data Systems is a global software and services company
dedicated to helping organizations integrate the enterprise-wide systems
required to create, transmit, access and control electronic information.
With its Rialto brand of directory-enabled software tools and services, the
company is focused on the architecture, implementation and lifetime support
of digital commerce and enterprise-wide client-server solutions for
business and government.
<PAGE #>
WCAS is one of the country's leading private investment firms. It
focuses on two primary industries: health care and information services.
