<PAGE> 1
UNITED STATES
SECURITIES & EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended: June 30, 1998
------------------------------
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from: to
-------------------- -----------------------
Commission file number: 0-23494
------------------------
BRIGHTPOINT, INC.
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(Exact name of registrant as specified in its charter)
Delaware 35-1778566
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State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization
6402 Corporate Drive, Indianapolis, Indiana 46278
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(Address of principal executive offices) (Zip Code)
(317) 297-6100
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(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [X] Yes [ ] No
Number of shares of common stock outstanding at August 5, 1998:
52,065,310 shares
<PAGE> 2
BRIGHTPOINT, INC.
INDEX
<TABLE>
<CAPTION>
Page No.
PART I. FINANCIAL INFORMATION
<S> <C> <C>
ITEM 1
Consolidated Statements of Income
Three and Six Months Ended June 30, 1997 and 1998.............................. 3
Consolidated Balance Sheets
December 31, 1997 and June 30, 1998............................................ 4
Consolidated Statements of Cash Flows
Six Months Ended June 30, 1997 and 1998........................................ 5
Notes to Consolidated Financial Statements............................................ 6
ITEM 2
Management's Discussion and Analysis of
Financial Condition and Results of Operations..................................10
PART II. OTHER INFORMATION
ITEM 2
Changes in Securities.................................................................16
ITEM 4
Submission of Matters to a Vote of Security Holders...................................16
ITEM 6
Exhibits and Reports on Form 8-K......................................................16
Signatures.........................................................................................17
</TABLE>
<PAGE> 3
BRIGHTPOINT, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Amounts in thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
1997 1998 1997 1998
-------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Net sales $ 220,027 $ 329,813 $ 419,196 $ 673,146
Cost of sales 202,013 299,308 385,180 612,564
-------------- ------------- ------------- -------------
Gross profit 18,014 30,505 34,016 60,582
Selling, general and administrative expenses 9,040 14,601 17,136 29,258
-------------- ------------- ------------- -------------
Income from operations 8,974 15,904 16,880 31,324
Net investment gain - - 1,432 572
Interest expense, net 1,983 3,027 3,106 6,439
-------------- ------------- ------------- -------------
Income before income taxes and minority interest 6,991 12,877 15,206 25,457
Income taxes 2,097 3,863 4,540 7,637
-------------- ------------- ------------- -------------
Income before minority interest 4,894 9,014 10,666 17,820
Minority interest 27 (44) 383 (81)
-------------- ------------- ------------- -------------
Net income $ 4,867 $ 9,058 $ 10,283 $ 17,901
============== ============= ============= =============
Net income per share:
Basic $ 0.11 $ 0.17 $ 0.23 $ 0.35
============== ============= ============= =============
Diluted $ 0.10 $ 0.17 $ 0.22 $ 0.33
============== ============= ============= =============
Weighted average common shares outstanding:
Basic 44,594 51,979 44,228 51,597
============== ============= ============= =============
Diluted 46,678 53,725 46,318 53,580
============== ============= ============= =============
</TABLE>
See accompanying notes.
3
<PAGE> 4
BRIGHTPOINT, INC.
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
<TABLE>
<CAPTION>
December 31, 1997 June 30, 1998
----------------- -------------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 2,941 $ 40,020
Accounts receivable (less allowance for
doubtful accounts of $3,394 in 1997
and $4,117 in 1998) 212,946 188,085
Contract financing receivables 49,470 14,397
Inventories 95,716 152,049
Marketable securities 3,478 -
Other current assets 26,960 33,338
------------------ ---------------
Total current assets 391,511 427,889
Property and equipment 23,420 38,944
Goodwill and other intangibles 31,161 69,671
Other assets 10,610 23,424
------------------ ----------------
Total assets $ 456,702 $ 559,928
================== ================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 110,191 $ 75,391
------------------ ----------------
Total current liabilities 110,191 75,391
Long-term debt 146,963 250,141
Minority interest 257 176
Stockholders' equity:
Preferred stock, $0.01 par value: 1,000 shares
authorized; no shares issued or outstanding - -
Common stock, $0.01 par value: 100,000 shares
authorized; 50,396 and 51,973 issued and
outstanding, respectively 504 520
Additional paid-in capital 160,387 178,912
Retained earnings 42,891 60,792
Accumulated other comprehensive income (loss) (4,491) (6,004)
------------------- -----------------
Total stockholders' equity 199,291 234,220
------------------- -----------------
Total liabilities and stockholders' equity $ 456,702 $ 559,928
================== =================
</TABLE>
See accompanying notes.
4
<PAGE> 5
BRIGHTPOINT, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended June 30
1997 1998
-------- --------
<S> <C> <C>
Operating activities
Net income $ 10,283 $ 17,901
Adjustments to reconcile net income to net cash
used by operating activities:
Depreciation and amortization 1,416 4,012
Amortization of debt discount - 2,103
Net investment gain (1,432) (572)
Minority interest and other 383 (130)
Changes in operating assets and liabilities:
Accounts receivable (4,063) 31,606
Inventories 15,717 (49,868)
Other current assets (1,021) (2,975)
Accounts payable and accrued expenses (44,247) (27,098)
-------- ---------
Net cash used by operating activities (22,964) (25,021)
Investing activities
Capital expenditures (9,650) (15,068)
Sale of marketable securities, net of
transaction costs 18,528 3,263
Acquisitions, net of cash acquired (4,034) (33,152)
Decrease in contract financing receivables,
net of unfunded portion - 7,072
Increase in other assets (3,089) (13,632)
-------- --------
Net cash provided (used) by investing activities 1,755 (51,517)
Financing activities
Net proceeds from (payments on) revolving credit
facility 17,938 (66,565)
Proceeds from issuance of subordinated, convertible
notes, net of issue costs - 166,088
Proceeds and tax benefits from exercise of
stock options and warrants 5,549 14,612
-------- --------
Net cash provided by financing activities 23,487 114,135
Effect of exchange rate changes on cash and cash
equivalents 406 (518)
-------- --------
Net increase in cash and cash equivalents 2,684 37,079
Cash and cash equivalents at beginning of period 14,255 2,941
-------- --------
Cash and cash equivalents at end of period $ 16,939 $ 40,020
======== ========
See accompanying notes.
</TABLE>
5
<PAGE> 6
BRIGHTPOINT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X of the Securities Exchange Act of 1934.
Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of the Company, all adjustments (consisting of
only normal recurring accruals) considered necessary to present fairly the
consolidated financial statements have been included.
The consolidated financial statements include the accounts of the Company and
its majority-owned subsidiaries. Significant intercompany accounts and
transactions have been eliminated in consolidation. Certain amounts in the
1997 consolidated financial statements have been reclassified to conform to
the 1998 presentation.
The consolidated balance sheet at December 31, 1997 has been derived from the
audited consolidated financial statements at that date, but does not include
all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. The unaudited
consolidated statements of income for the three and six months ended June 30,
1998 is not necessarily indicative of the results that may be expected for
the entire year.
For further information, reference is made to the audited consolidated
financial statements and the footnotes thereto included in the Company's
Annual Report on Form 10-K, as amended, for the year ended December 31, 1997.
In February 1997, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 128, Earnings Per Share,
which replaced the presentation of primary earnings per share (EPS) with
basic EPS and replaced fully diluted EPS with diluted EPS. Basic net income
per share is based on the weighted average number of common shares
outstanding during each period and diluted net income per share is based on
the weighted average number of common shares and dilutive common share
equivalents outstanding during each period. The Company's dilutive common
share equivalents consist of shares of common stock issuable upon exercise of
outstanding stock options and stock warrants. The subordinated, convertible
notes (see Note 4) issued in the first quarter of 1998, although common
share equivalents, were not dilutive for the three and six months ended
June 30, 1998. The weighted average number of common shares outstanding for
diluted EPS includes only the dilutive common share equivalents as defined
above.
6
<PAGE> 7
BRIGHTPOINT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
2. Comprehensive Income
On January 1, 1998, the Company adopted Statement of Financial Accounting
Standards No. 130, Reporting Comprehensive Income (SFAS No. 130) which
establishes new rules for the reporting and display of comprehensive income
and its components (Net income and "Other comprehensive income"). Adoption
of this Statement had no impact on the Company's net income or stockholders'
equity. The statement requires that unrealized gains or losses on the
Company's available-for-sale securities and foreign currency translation
adjustments, which prior to adoption were reported separately in
stockholders' equity, be included as components of "Other comprehensive
income."
During the three months ended June 30, 1997 and 1998, comprehensive income
totaled $5,091,000 and $6,917,000, respectively and during the six months
ended June 30, 1997 and 1998 totaled $6,612,000 and $16,388,000,
respectively.
3. Acquisitions
During the six months ended June 30, 1998, the Company made nine
acquisitions of businesses separately located in (i) Brazil; (ii) the United
Kingdom; (iii) the Netherlands, Germany and Poland; (iv) the United States;
(v) Taiwan; (vi) Poland; (vii) France; (viii) Mexico; and (ix) New Zealand.
Each of these transactions was accounted for as a purchase and, accordingly,
the consolidated financial statements include the operating results of each
business from the effective date of acquisition. The aggregate purchase
price for these businesses consisted of 280,442 unregistered shares of the
Company's common stock (valued at $3.8 million), $37.8 million in cash, the
assumption of certain liabilities and contingent consideration of up to
$13.4 million in cash and $17.1 million in common stock based upon future
operating results of the applicable business over the next two years. The
resulting goodwill of $35.7 million from these acquisitions is being
amortized over 30 years.
During the six months ended June 30, 1997, the Company acquired the
remaining minority interests of three majority-owned subsidiaries and
certain net assets of one business located in Sweden. Each of these
transactions was accounted for as a purchase and, accordingly, the
consolidated financial statements include the operating results of each
business from the effective date of acquisition. The aggregate purchase
price consisted of 464,490 unregistered shares of the Company's common
stock (valued at $3.1 million), $4.3 million in cash, the assumption of
certain liabilities and contingent consideration based on the operating
results of the applicable operating units. As of June 30, 1998 all
contingent consideration amounts related to these acquisitions have been
settled and paid in full. The resulting goodwill of $9.5 million from
these acquisitions is being amortized over 30 years.
The impact of the Company's acquisitions was not material in relation to the
Company's results of operations for the six months ended June 30, 1997 and
1998. Consequently, pro forma information is not presented.
7
<PAGE> 8
BRIGHTPOINT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
4. Long-term debt
On March 11, 1998, the Company completed the issuance of zero-coupon,
subordinated, convertible notes due in the year 2018 (the "Bonds") with an
aggregate face value of $380 million ($1,000 per bond) and a yield to
maturity of 4.00%. The Bonds are subordinated to all existing and future
senior indebtedness (as defined in the indenture pursuant to which the Bonds
were issued) of the Company and all other liabilities, including trade
payables, of the Company's subsidiaries. The Bonds resulted in gross proceeds
to the Company of approximately $172 million (issue price of $452.89 per
Bond) and require no periodic cash payments of interest. The proceeds were
used to reduce borrowings under the Company's revolving credit facility and
to invest in highly-liquid, short-term investments pending use in operations.
At June 30, 1998, the Bonds had a carrying value of approximately $174
million.
Each Bond is convertible at the option of the holder any time prior to
maturity. Upon conversion, the Company, at its option, will deliver to the
holder 19.109 shares of common stock per Bond or cash equal to the market
value of such shares. On or after March 11, 2003, the Bonds may be redeemed
at any time by the Company for cash equal to the issuance price plus accrued
original discount through the date of redemption. In addition, each Bond may
be redeemed at the option of the holder on March 11, 2003, 2008 or 2013. The
purchase price for each Bond at these redemption dates is approximately $552,
$673 and $820, respectively, which is equal to the issue price plus amortized
original discount through the date of redemption. The Company may elect at
its option to pay for such redemption in cash or common stock, or any
combination thereof equaling the purchase price.
On June 24, 1997, the Company entered into a $200 million five-year senior
secured revolving line of credit facility with The First National Bank of
Chicago and Bank One, Indiana, NA, as co-agents for a group of banks
(collectively, the "Banks"). On May 13, 1998, the Company and the Banks
amended and restated this agreement resulting in a $225 million facility with
substantially the same terms ("Restated Facility"). The Restated Facility
matures in June 2002 and generally bears interest, at the Company's option,
at (i) the greater of the agent bank's corporate base rate and the Federal
Funds effective rate plus 0.50% or (ii) the rate at which deposits in United
States dollars or Eurocurrencies are offered by the agent bank to
first-class banks in the London interbank market plus a spread ranging from
40 to 112.5 basis points (based on the Company's leverage ratio) plus a
spread reserve, if any. Borrowings by the Company's non-United States
subsidiaries bear interest at various rates based on the type and term of
advance selected and the prevailing interest rates of the country in which
the subsidiary is domiciled. At June 30, 1998, there was approximately $76
million outstanding under this line of credit at an interest rate of 6.6% and
an aggregate of $8 million in letters of credit issued.
8
<PAGE> 9
BRIGHTPOINT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
4. Long-term debt (continued)
All of the Company's assets located in the United States and 65% of the
capital stock of certain of the Company's subsidiaries domiciled outside of
the United States are pledged to the Banks as collateral for the Restated
Facility, and the Company is substantially prohibited from incurring
additional indebtedness. In addition to certain net worth and other
financial covenants, the Company's Restated Facility limits or prohibits the
Company, subject to certain exceptions, from declaring or paying cash
dividends, making capital distributions or other payments to stockholders,
merging or consolidating with another corporation or selling portions of its
assets.
5. Net Investment Gain
During the first quarter of 1997 and 1998, the Company realized gains on
sales of marketable equity securities, representing income of a
non-recurring nature. The net gains after related transaction costs were
approximately $1.4 million and $0.6 million in 1997 and 1998, respectively.
Excluding the impact of the net investment gains and related income taxes,
net income for the first half of 1997 would have been $9.4 million or $0.20
per share (diluted) and net income for the first half of 1998 would have
been $17.6 million or $0.33 per share (diluted).
6. Recently Issued Accounting Pronouncement
In June 1998, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 133, Accounting for
Derivative Instruments and Hedging Activities, which provides a
comprehensive and consistent standard for the recognition and measurement of
derivatives and hedging activities. The Statement is effective for years
beginning after June 15, 1999, however, early adoption as of the beginning
of any fiscal quarter after June 1998 is permitted. The Company is
currently evaluating the effect that this pronouncement might have on its
results of operations and financial position, but does not expect any
material adverse effects from adoption of this standard.
9
<PAGE> 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
(Amounts in thousands, except per share data)
Overview
This discussion and analysis should be read in conjunction with the accompanying
consolidated financial statements and related notes. Certain statements made in
this report may contain forward-looking statements. For a description of risks
and uncertainties relating to such forward-looking statements, see Exhibit 99
and the Company's Annual Report on Form 10-K, as amended,for the year ended
December 31, 1997.
During the first and second quarters of 1998, the Company acquired either all of
the equity interests or certain net assets of the following nine businesses that
were accounted for as purchases. Accordingly, the consolidated financial
statements include the operating results of each business from the effective
date of acquisition:
First Quarter 1998
- - Matel-Tecnologia de Teleinformatica S.A.-Matec - a wireless telephone
distributor located in Sao Paulo, Brazil.
- - WAVETech Limited - a wireless telephone distributor in the United Kingdom.
- - Wireless Fulfillment Services, LLC - a provider of wireless accessory
end-user fulfillment services for North American network operators.
- - Axess Communications Benelux B.V. - a provider of accessory distribution
services for the wireless communications industry with operations in the
Netherlands, Germany and Poland.
Second Quarter 1998
- - Cell Direct Limited - a wireless telephone distributor located in Auckland,
New Zealand.
- - Function Communications Co., Ltd. - a wireless products distributor
headquartered in Taipei, Taiwan.
- - Euro-Phone Sp. Z o.o. - a wireless products distributor in Warsaw, Poland.
- - Communicaciones ASBE, S.A. de C.V. - a wireless telephone and accessories
distributor located in Mexico City.
- - Eurocom Systems S.A. - a provider of distribution and integrated logistics
services in France.
10
<PAGE> 11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
(Amounts in thousands, except per share data)
Results of Operations
Net Sales
<TABLE>
<CAPTION>
Three Months Ended June 30 Six Months Ended June 30
------------------------------------------------------------
1997 1998 Change 1997 1998 Change
- --------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net sales $ 220,027 $ 329,813 50% $ 419,196 $ 673,146 61%
- --------------------------------------------------------------------------
</TABLE>
Net sales for the three and six months ended June 30, 1998 increased
significantly over net sales for the same periods in 1997 reflecting the
continued growth in worldwide demand for wireless handsets and related
accessories. The increase in net sales is primarily attributable to volume
growth in all of the Company's divisions as demand for wireless handsets,
accessories and the Company's value-added logistics services continued to grow.
In addition, the Company believes that it continued to increase its share of the
wireless handset market in various markets around the world.
<TABLE>
<CAPTION>
Three Months Ended June 30 Six Months Ended June 30
-------------------------------- -------------------------------
1997 1988 1997 1998
-------------------------------- -------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales by division:
Asia-Pacific $ 97,967 44% $ 107,333 33% $ 183,610 44% $ 237,051 35%
Europe, Middle East 48,616 22% 95,674 29% 86,237 20% 201,933 30%
and Africa
North America 58,755 27% 92,268 28% 129,527 31% 165,823 25%
Latin America 14,689 7% 34,538 10% 19,822 5% 68,339 10%
------------------------------- -------------------------------
$ 220,027 100% $ 329,813 100% $ 419,196 100% $ 673,146 100%
------------------------------- -------------------------------
</TABLE>
The Company experienced net sales increases in all of its divisions as it
continued to penetrate markets outside the United States by increasing its
in-country presence in targeted growth markets and as it increased its service
and accessory offerings worldwide.
<TABLE>
<CAPTION>
Three Months Ended June Six Months Ended June 30
-------------------------------- ---------------------------------
1997 1998 1997 1998
-------------------------------- ---------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales by service line:
Wireless handset sales $ 194,935 88% $ 265,245 80% $ 375,365 89% $ 561,103 83%
Wireless accessories sales 14,656 7% 29,312 9% 28,817 7% 55,370 8%
Value-added logistics 10,436 5% 35,256 11% 15,014 4% 56,673 9%
services
-------------------------------- ---------------------------------
$ 220,027 100% $ 329,813 100% $ 419,196 100% $ 673,146 100%
-------------------------------- ---------------------------------
</TABLE>
Net sales for the three and six months ended June 30, 1998, as compared to the
same periods in 1997, include a greater proportion of revenues from
higher-margin value-added logistics services as the Company continues to
develop and expand its service offerings.
11
<PAGE> 12
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
(Amounts in thousands, except per share data)
Results of Operations (continued)
Gross Profit
<TABLE>
<CAPTION>
Three Months Ended June 30 Six Months Ended June 30
----------------------------- ------------------------------
1997 1998 Change 1997 1998 Change
- -------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Gross profit $ 18,014 $ 30,505 69% $ 34,016 $ 60,582 78%
Gross margin percentage 8.2% 9.2% 8.1% 9.0%
- -------------------------------------------------------------------------------------
</TABLE>
Gross profit for the three and six months ended June 30, 1998 improved
significantly over the same periods in 1997 due to increased sales and increased
gross margin percentage. The increase in gross margin percentage is primarily
due to an increase in the amount of higher margin value-added logistics services
provided by the Company. Gross margins were also enhanced through the Company's
disciplined effort to migrate from lower margin sales made to other distributors
to higher margin direct sales, taking advantage of the Company's expanded
in-country presences in its Asia-Pacific and Europe, Middle East and Africa
divisions.
Selling, General and Administrative Expenses
<TABLE>
<CAPTION>
Three Months Ended June 30 Six Months Ended June 30
--------------------------------------------------------------
1997 1998 Change 1997 1998 Change
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Selling, general and
administrative expenses $ 9,040 $ 14,601 62% $ 17,136 $ 29,258 71%
As a percent of net sales 4.1% 4.4% 4.1% 4.3%
- ----------------------------------------------------------------------------------------
</TABLE>
The increase in selling, general and administrative expenses for the three and
six months ended June 30, 1998 as compared to the same periods in 1997 is due
primarily to planned increases in managerial, information technology and other
resources necessary to support the increased demand for the Company's services
in markets around the world.
Income from Operations
<TABLE>
<CAPTION>
Three Months Ended June 30 Six Months Ended June 30
----------------------------------------------------------
1997 1998 Change 1997 1998 Change
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Income from operations $ 8,974 $ 15,904 77% $ 16,880 $ 31,324 86%
As a percent of net sales 4.1% 4.8% 4.0% 4.7%
- ---------------------------------------------------------------------------------------
</TABLE>
The increase in income from operations and operating margin (income from
operations as a percent of net sales) for the three and six months ended June
30, 1998 compared to the same periods in 1997 is primarily attributable to the
increase in net sales and gross margin partially offset by the increase in
selling, general and administrative expenses.
12
<PAGE> 13
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
(Amounts in thousands, except per share data)
Net Income
<TABLE>
<CAPTION>
Three Months Ended June 30 Six Months Ended June 30
--------------------------------- -----------------------------
1997 1998 Change 1997 1998 Change
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net income $ 4,867 $ 9,058 86% $ 10,283 $ 17,901 74%
Adjusted net income(1) $ 4,867 $ 9,058 86% $ 9,435 $ 17,558 86%
Adjusted net income as a 2.2% 2.7% 2.3% 2.6%
percent of net sales
Adjusted net income per $ 0.10 $ 0.17 70% $ 0.20 $ 0.33 65%
share (diluted)
Weighted average shares
outstanding (diluted) 46,678 53,725 46,318 53,580
- -----------------------------------------------------------------------------------
</TABLE>
(1) Adjusted to exclude the after-tax effect of net investment gains of $1,432
and $572 for the six months ended June 30, 1997 and 1998, respectively.
The increase in net income and adjusted net income for the three and six months
ended June 30, 1998 over the same periods in 1997 is the result of increased
income from operations, partially offset by an increase in interest expense
relating to long-term debt obtained for working capital purposes. During the
first quarter of 1997 and 1998, the Company realized gains on sales of
marketable equity securities, representing income of a non-recurring nature.
The net gains after related transaction costs were approximately $1.4 million
and $0.6 million in 1997 and 1998, respectively.
The increase in weighted average shares outstanding is due primarily to shares
issued in connection with the Company's public offering of 5,400,000 shares in
August 1997 as well as certain acquisition activity and the impact of stock
options and warrants.
Liquidity and Capital Resources
<TABLE>
<CAPTION>
December 31, 1997 June 30, 1998
- -----------------------------------------------------------------------------------
<S> <C> <C>
Cash, cash equivalents and marketable
securities $ 6,419 $ 40,020
Working capital $ 281,320 $ 352,498
Current ratio 3.55 : 1 5.68 : 1
- -----------------------------------------------------------------------------------
</TABLE>
Historically, the Company's primary cash requirements have been to fund
increased levels of accounts receivable and inventories. The Company has
satisfied its working capital requirements principally through cash flow from
operations, vendor financing, bank borrowings and the issuance of debt and
equity securities.
The increase in working capital during the six months ended June 30, 1998 is
primarily attributable to a decrease in accounts payable and an increase in
inventories partially offset by a decrease in accounts receivable. The increase
in working capital was funded principally by the issuance of zero-coupon,
subordinated, convertible Bonds in March 1998.
13
<PAGE> 14
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
(Amounts in thousands, except per share data)
Liquidity and Capital Resources (continued)
Net cash used by operating activities was $25.5 million for the six months ended
June 30, 1998 as compared to $23.0 million in the comparable prior period. The
increase in net cash used by operating activities was primarily attributable an
increase in inventories and a decrease in accounts payable partially offset by a
decrease in accounts receivable.
Net cash used by investing activities for the six months ended June 30, 1998 was
$53.4 million as compared to net cash provided by investing activities of $1.8
million in the comparable prior period. Cash used by investing activities during
the six months ended June 30, 1998 was primarily attributable to capital
expenditures relating to the purchase of information systems and software and
acquisitions completed in the period, partially offset by the Company's contract
financing activity and proceeds from the sale of marketable securities. Cash
provided by investing activities for the six months ended June 30, 1997 was
primarily attributable to the sale of marketable securities partially offset by
capital expenditures relating to the purchase of information systems equipment
and software, the expansion of the Company's warehouse facility in Indianapolis,
Indiana, the opening of its west coast distribution center in Sparks, Nevada and
the continued expansion of its international operations.
Net cash provided by financing activities for the six months ended June 30,
1998 is primarily due to the issuance of the Bonds discussed below and proceeds
from the exercise of stock options partially offset by principal reductions on
the Company's line of credit. Net cash provided by financing activities for the
six months ended June 30, 1997 was primarily due to advances against the
Company's line of credit and proceeds from the exercise of stock options.
On March 11, 1998, the Company completed the sale of zero-coupon, subordinated,
convertible notes (the "Bonds") with an aggregate principal amount at maturity
of $380 million ($1,000 face value per Bond). The Bonds are due in the year
2018, have a yield to maturity of 4.00% and are convertible into the Company's
common stock at a rate of 19.109 shares per bond. The Bonds were placed for the
Company by Merrill Lynch & Co. and resulted in gross proceeds to the Company of
approximately $172 million. The proceeds were used to reduce borrowings under
the Company's revolving credit facility and to invest in highly-liquid,
short-term investments pending use in operations. The Bonds are subordinated to
all existing and future senior indebtedness (as defined in the indenture
pursuant to which the Bonds were issued) of the Company and all other
liabilities, including trade payables, of the Company's subsidiaries.
Through 1997 the Company generated a 5-year compounded annual growth rate in net
sales and pro forma net income in excess of 60% and 80%, respectively. In order
to fund the working capital necessary for this level of growth, the Company
successfully raised over $350 million of capital through the end of 1997 (using
an appropriate combination of both debt and equity capital). In addition, during
the three months ended March 31, 1998, the Company raised approximately $172
million in capital from the issuance of the Bonds discussed above. The Company
believes that additional debt or equity capital could be necessary to fund
working capital needs associated with such growth.
14
<PAGE> 15
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
(Amounts in thousands, except per share data)
Foreign Operations and Foreign Currency
The Company transacts business in worldwide markets and is exposed to foreign
currency exchange rate risk inherent in its assets, liabilities and results of
operations denominated in currencies other than the U.S. dollar, as well as
interest rate risk inherent in the Company's debt. Certain of the Company's
subsidiaries have assets, liabilities or commitments that are
denominated in currencies other than the respective operation's functional
currency. The Company periodically utilizes derivative financial instruments,
including forwards, swaps and purchased options as well as borrowings
denominated in foreign currencies to hedge certain foreign currency and
interest rate exposures, with the intent of offsetting gains and losses on the
financial instruments against the gains and losses that occur on the underlying
exposures. The Company does not enter into derivatives for speculative or
trading purposes.
15
<PAGE> 16
PART II. OTHER INFORMATION
Item 2. Changes in Securities
During the quarter ended June 30, 1998, the Company issued to the respective
sellers, unregistered shares of the Company's common stock as follows in
connection with its acquisition activities:
<TABLE>
<CAPTION>
Date Entity Acquired Shares Issued Value
- ----------------- --------------------------------- -------------- -----------
<S> <C> <C> <C>
April 1, 1998 Wireless Fulfillment Services, LLC 118,213 $ 1,612,500
April 20, 1998 Axess Communications Benelux B.V. 72,072 $ 1,000,000
May 1, 1998 Function Communications Co., Ltd. 53,368 $ 790,500
June 19, 1998 Communicaciones ASBE, S.A. de C.V. 36,789 $ 412,500
</TABLE>
The foregoing securities issuances were made in reliance on the exemptions from
registration provided by Section 4(2) (issuances not involving a public
offering) of the Securities Act of 1933, as amended. No underwriter fees or
commissions were paid by the Company in connection with such issuances.
Item 4. Submission of Matters to a Vote of Security Holders
An Annual Meeting of Stockholders was held on April 16, 1998 to elect three (3)
Class I directors to hold office until the Annual Meeting of Stockholders to be
held in 2001 and until their respective successors have been duly elected and
qualified. The terms of office of Class II directors Messrs. Robert J. Laikin,
Robert F. Wagner and Rollin M. Dick continue until 1999. The terms of office of
Class III directors Messrs. John W. Adams, T. Scott Housefield and Steven B.
Sands continue until 2000. The results of the vote to elect the three (3) Class
I directors were as follows:
J. Mark Howell received 46,197,271 votes for and 81,476 votes withheld,
Stephen H. Simon received 46,192,931 votes for and 85,816 votes withheld
and Todd H. Stuart received 46,194,608 votes for and 84,139 votes withheld.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
The list of exhibits is hereby incorporated by reference to the Exhibit
Index on page 18 of this report.
(b) Reports on Form 8-K
On April 1, 1998 the Company filed a Form 8-K with the Securities and
Exchange Commission reporting under Item 5 - Other Events, the completion
on March 11, 1998 of the issuance and sale of $380,000,000 aggregate
principal amount at maturity of zero-coupon, subordinated,
convertible notes due in the year 2018.
16
<PAGE> 17
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Brightpoint, Inc.
(Registrant)
Date August 6, 1998 /s/ Phillip A. Bounsall
-------------------------------- ----------------------------
Phillip A. Bounsall
Executive Vice President,
Chief Financial Officer
(Principal Financial Officer)
Date August 6, 1998 /s/ John P. Delaney
-------------------------------- ----------------------------
John P. Delaney
Vice President, Corporate
Controller (Principal
Accounting Officer)
17
<PAGE> 18
Exhibit Index
<TABLE>
<CAPTION>
Exhibit No. Description
<S> <C>
(10.1) Fourth Amendment to Multicurrency Credit Agreement dated April 16, 1998
(10.2) Amended and Restated Multicurrency Credit Agreement originally
dated June 24, 1997 and amended and restated as of May 13, 1998.
(10.3) Lease Expansion Agreement between the Company and SCI North Carolina Limited Partnership,
dated June 9, 1998
(11) Statement Re: Computation of Earnings Per Share
(27) Financial Data Schedule for the Six Months ended June 30, 1998
(99) Cautionary Statements
</TABLE>
18
<PAGE> 1
Exhibit 10.1
Execution Copy
AMENDMENT NO. 4
TO MULTICURRENCY CREDIT AGREEMENT
Dated as of April 16, 1998
THIS AMENDMENT NO. 4 TO MULTICURRENCY CREDIT AGREEMENT ("Amendment")
is made as of April 16, 1998 by and among BRIGHTPOINT, INC. ("Brightpoint"),
BRIGHTPOINT INTERNATIONAL LTD., the subsidiary borrowers from time to time party
thereto (collectively, the "Borrowers"), the guarantors from time to time party
thereto (the "Guarantors"), the financial institutions listed on the signature
pages hereof as lenders (the "Lenders"), BANK ONE, INDIANA, NATIONAL
ASSOCIATION, in its individual capacity as a Lender and as syndication agent
(the "Syndication Agent"), and THE FIRST NATIONAL BANK OF CHICAGO, in its
individual capacity as a Lender and as administrative agent (the "Administrative
Agent"; and together with the Syndication Agent, the "Agents") on behalf of the
Lenders under that certain Multicurrency Credit Agreement dated as of June 24,
1997 by and among the Borrowers, the Guarantors, the Lenders and the Agents, as
amended by that certain Waiver and Amendment No. 1 dated as of November 15,
1997, that certain Amendment No. 2 dated as of February 25, 1998, Amendment No.
3 dated as of March 20, 1998 and by the letter agreement dated August 8, 1997,
(as so modified, and as further amended, modified or restated, the "Credit
Agreement"). Defined terms used herein and not otherwise defined herein shall
have the meaning given to them in the Credit Agreement.
WITNESSETH
WHEREAS, the Borrowers, the Guarantors, the Lenders and the Agents are
parties to the Credit Agreement;
WHEREAS, the Borrowers have requested that the Lenders amend the
Credit Agreement in certain respects; and
WHEREAS, the Lenders and the Agents are willing to amend the Credit
Agreement on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises set forth above, the
terms and conditions contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Borrowers, the Guarantors, the Lenders and the Agents have agreed to the
following amendments to the Credit Agreement.
1. Amendments to Credit Agreement. Effective as of the date hereof and
subject to the satisfaction of the conditions precedent set forth in Section 2
below, the Credit Agreement is hereby amended to the add the following thereto
immediately following Section 6.4:
<PAGE> 2
6.5 Corporate Restructuring. Notwithstanding anything to the contrary
contained in this Agreement, the Borrower and its Subsidiaries may effect a
restructuring of their corporate organization from the current organizational
structure as set forth in Schedule 6.5A to the organizational structure as set
forth in Schedule 6.5B (the "Tax Restructuring") provided that prior to the
transfer by any of the Borrower's subsidiaries assets or stock to the Borrower
or to any other Subsidiary, (a) BPI shall have pledged, pursuant to
documentation reasonably acceptable to the Administrative Agent (including,
without limitation, a pledge agreement or deed of pledge, corporate resolutions
and other corporate documentation certified by the applicable government or
corporate officials, and opinions of U.S. and Dutch counsel) 65% of the
outstanding capital stock of Brightpoint International Holdings B.V., (b)
Brightpoint International Holdings B.V. shall have pledged, pursuant to
documentation reasonably acceptable to the Administrative Agent (including,
without limitation, a pledge agreement or deed of pledge, corporate resolutions
and other corporate documentation certified by the applicable government or
corporate officials, and opinions of U.S. and Dutch counsel) 65% of the
outstanding capital stock of Brightpoint Holdings B.V., (c) Brightpoint shall
have pledged, pursuant to documentation reasonably acceptable to the
Administrative Agent (including, without limitation, a pledge agreement,
corporate resolutions and other corporate documentation certified by an officer
of Brightpoint and opinions of U.S. counsel) all of the outstanding capital
stock of Brightpoint Latin America Holdings and all of the membership interests
of Wireless Stockroom LLC, and (d) each of Brightpoint Latin America Holdings
and Wireless Stockroom LLC shall have executed and delivered to the
Administrative Agent a Guarantor Assumption Letter pursuant to which it agrees
to be bound by the provisions of Article IX, together with corporate
resolutions and such other corporate documentation as the Administrative Agent
may reasonably request, all in form and substance reasonably satisfactory to
the Administrative Agent. In connection with the Tax Restructuring, the
Administrative Agent is hereby authorized by each of the Lenders to (i) release
the Collateral which is subject to each of the following pledge agreements:
(a) that certain Equitable Share Charge dated as of June 24, 1997
executed by Brightpoint and Brightpoint EMA Limited in favor of the
Administrative Agent for the benefit of the Holders of Secured
Obligations pledging 20% and 45%, respectively, of the Capital Stock
of Brightpoint (UK) Limited to secure payment of the Secured
Obligations;
(b) that certain Share Mortgage dated as of June 24, 1997
executed by Brightpoint and Brightpoint International (Asia Pacific)
Pty Limited in favor of the Administrative Agent for the benefit of
the Holders of Secured Obligations, together with any Notice of
Identification delivered thereunder with respect to the Capital Stock
of Brightpoint Australia Pty Limited to secure payment of the Secured
Obligations;
2
<PAGE> 3
(c) that certain Equitable Share Charge dated as of June 24, 1997
executed by Brightpoint and Brightpoint International (Asia Pacific)
Pte Ltd in favor of the Administrative Agent for the benefit of the
Holders of Secured Obligations pledging 20% and 45%, respectively, of
the Capital Stock of Brightpoint China Limited to secure payment of
the Secured Obligations; and
(d) that certain Share Pledge Agreement dated as of November 15,
1997 executed by Brightpoint International Ltd in favor of the
Administrative Agent for the benefit of the Holders of Secured
Obligations pledging 65%, of the Capital Stock of Brightpoint Sweden
AG to secure payment of the Secured Obligations; and
(ii) execute such other consents or other documents as shall be acceptable
to the Administrative Agent and which are reasonably requested by
Brightpoint or its subsidiaries in connection with effecting the Tax
Restructuring.
2. Conditions of Effectiveness. This Amendment shall become effective and
be deemed effective as of the date hereof, if, and only if, the Administrative
Agent shall have received each of the following:
(a) duly executed originals of this Amendment from the Borrowers, the
Guarantors and the Required Lenders;
(b) a $5,000 working fee for the account of each Lender (individually
and not in the aggregate) paid in immediately available funds, to be
distributed to each Lender promptly upon the effectiveness of this
Amendment; and
(c) such other documents, instrzuments and agreements as the
Administrative Agent may reasonably request.
3. Representations and Warranties of the Borrowers. As of the
effectiveness of this Amendment, the Borrowers hereby represent and warrant:
(a) This Amendment and the Credit Agreement as previously executed and
as amended hereby, constitute legal, valid and binding obligations of the
Borrowers and are enforceable against the Borrowers in accordance with their
terms.
(b) Upon the effectiveness of this Amendment, the Borrowers hereby
reaffirm all representations and warranties made in the Credit Agreement and
other Loan Documents, and agree that all such representations and warranties
shall be deemed to have been remade as of the effective date of this Amendment.
4. Reference to the Effect on the Credit Agreement.
3
<PAGE> 4
(a) Upon the effectiveness of Section 1 hereof, on and after the date
hereof, each reference in the Credit Agreement to "this Agreement," "hereunder,"
"hereof," "herein" or words of like import shall mean and be a reference to the
Credit Agreement, as amended previously and as amended hereby.
(b) Except as specifically amended above, the Credit Agreement and all
other documents, instruments and agreements executed and/or delivered in
connection therewith shall remain in full force and effect, and are hereby
ratified and confirmed.
(c) The execution, delivery and effectiveness of this Amendment shall
not, except as expressly provided herein, operate as a waiver of any right,
power or remedy of the Administrative Agent or any of the Lenders, nor
constitute a waiver of any provision of the Credit Agreement or any other
documents, instruments and agreements executed and/or delivered in connection
therewith.
6. Costs and Expenses. The Borrowers agree to pay all reasonable costs,
fees and out-of-pocket expenses (including attorneys' fees and expenses charged
to the Administrative Agent) incurred by the Administrative Agent in connection
with the preparation, arrangement, execution and enforcement of this Amendment.
7. Governing Law. This Amendment shall be governed by and construed in
accordance with the internal laws (as opposed to the conflict of law provisions)
of the State of Illinois.
8. Headings. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
9. Counterparts. This Amendment may be executed by one or more of the
parties to the Amendment on any number of separate counterparts and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.
10. No Strict Construction. The parties hereto have participated jointly
in the negotiation and drafting of this Amendment, the Credit Agreement and the
other Loan Documents. In the event an ambiguity or question of intent or
interpretation arises, this Amendment, the Credit Agreement and the other Loan
Documents shall be construed as if drafted jointly by the parties hereto and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Amendment, the Credit
Agreement or any of the other Loan Documents.
11. Reaffirmation of Guaranties and other Loan Documents. Each of the
Guarantors, without in any way establishing a course of dealing, as evidenced by
its signature below, hereby consents to the execution and delivery of this
Amendment by the parties hereto and the transactions involved in effecting the
Tax Restructuring, (ii) agrees that neither this Amendment nor the Tax
Restructuring shall limit or diminish the obligations of such Guarantor under
the Credit Agreement
4
<PAGE> 5
or any other Loan Documents, (iii) reaffirms its obligations under the Credit
Agreement and other Loan Documents, and (iv) agrees that such obligations remain
in full force and effect and are hereby ratified and confirmed.
5
<PAGE> 6
IN WITNESS WHEREOF, this Amendment has been duly executed as of the
day and year first above written.
BRIGHTPOINT, INC.
as a Borrower and Guarantor
By: /s/ Steven E. Fivel
--------------------
Name:
Title:
BRIGHTPOINT INTERNATIONAL LTD.
as a Borrower and Guarantor
By: /s/ Steven E. Fivel
--------------------
Name:
Title:
BRIGHTPOINT (UK) LIMITED,
as a Subsidiary Borrower and Guarantor
By: /s/ Steven E. Fivel
--------------------
Name:
Title:
BRIGHTPOINT AUSTRALIA PTY. LIMITED,
as a Subsidiary Borrower and Guarantor
By: /s/ Steven E. Fivel
--------------------
Name:
Title:
<PAGE> 7
BRIGHTPOINT CHINA LIMITED,
as a Subsidiary Borrower and Guarantor
By: /s/ Steven E. Fivel
--------------------
Name:
Title:
BRIGHTPOINT EMA LIMITED,
as a Guarantor
By: /s/ Steven E. Fivel
--------------------
Name:
Title:
BRIGHTPOINT AUSTRALASIA PTY. LIMITED,
as a Guarantor
By: /s/ Steven E. Fivel
--------------------
Name:
Title:
BRIGHTPOINT INTERNATIONAL (ASIA PACIFIC)
PTE LTD., as a Guarantor
By: /s/ Steven E. Fivel
--------------------
Name:
Title:
BRIGHTPOINT F.S.C. INC., as a Guarantor
By: /s/ Steven E. Fivel
--------------------
Name:
Title:
<PAGE> 8
RPS INDUSTRIES COMPANY LIMITED, as a Guarantor
By: /s/ Steven E. Fivel
--------------------
Name:
Title:
<PAGE> 9
THE FIRST NATIONAL BANK OF CHICAGO
as the Administrative Agent, an
Issuing Lender, the Swing Line
Lender, an Alternate Currency
Agent and as a Lender
By: /s/ Leo G. Watson, Jr.
------------------------------
Name: Leo G. Watson, Jr.
Title: Vice President
BANK ONE, INDIANA, NATIONAL ASSOCIATION
as the Syndication Agent, an Issuing
Lender and as a Lender
By: /s/ William D. Herrick
------------------------------
Name: William D. Herrick
Title: Senior Vice President
BANK BOSTON, N.A.
as a Lender
By: /s/ Robert W. MacElhiney
------------------------------
Name: Robert W. MacElhiney
Title: Vice President
CORESTATES BANK, N.A.
as a Lender
By: /s/ Kristen M. Denning
------------------------------
Name: Kristen M. Denning
Title: Assistant Vice President
SUNTRUST BANK OF CENTRAL FLORIDA,
NATIONAL ASSOCIATION
as a Lender
By: /s/ C. A. Black
------------------------------
Name: C. A. Black
Title: Vice President
THE BANK OF NOVA SCOTIA
as a Lender
By: F.C.H. Ashby
------------------------------
Name: F.C.H. Ashby
Title: Senior Manager Loan Operations
<PAGE> 10
CREDIT LYONNAIS CHICAGO BRANCH
as a Lender
By: /s/ Lee E. Greve
------------------------------
Name: Lee E. Greve
Title: First Vice President
THE BANK OF TOKYO-MITSUBISHI, LTD.
CHICAGO BRANCH
as a Lender
By: /s/ Hajime Watanabe
------------------------------
Name: Hajime Watanabe
Title: Deputy General Manager
THE FUJI BANK, LIMITED
as a Lender
By: /s/ Peter L. Chinnici
------------------------------
Name: Peter L. Chinnici
Title: Joint General Manager
<PAGE> 1
Exhibit 10.2
Execution Copy
________________________________________________________________________________
AMENDED AND RESTATED
MULTICURRENCY CREDIT AGREEMENT
Originally Dated as of June 24, 1997
Amended and Restated as of May 13, 1998
among
BRIGHTPOINT, INC.
and
BRIGHTPOINT INTERNATIONAL LTD.,
AS BORROWERS AND GUARANTORS,
THE OTHER GUARANTORS FROM TIME TO TIME PARTY HERETO,
THE FINANCIAL INSTITUTIONS FROM TIME TO TIME
PARTY HERETO, AS LENDERS,
NBD BANK, N.A.,
as Administrative Agent
and
BANK ONE, INDIANA, NATIONAL ASSOCIATION,
as Syndication Agent
________________________________________________________________________________
<PAGE> 2
TABLE OF CONTENTS
ARTICLE I: DEFINITIONS.........................................................2
1.1 Certain Defined Terms.................................................2
1.2 Supplemental Disclosure..............................................32
1.3 Currency Equivalents.................................................32
1.4 Amendment and Restatement of Original Credit Agreement...............32
1.5 Replacement of the Original Administrative Agent.....................33
ARTICLE II: THE CREDITS.......................................................33
2.1 Revolving Loans to Brightpoint and BPI...............................33
2.2 Swing Line Loans.....................................................33
2.3 Alternate Currency Facility..........................................35
2.4. Conversion of Alternate Currency Loans; Risk Sharing by All
Lenders in Alternate Currency Credits.............................37
2.5 Optional Payments; Mandatory Prepayments.............................42
(A) Optional Payments.............................................42
(B) Mandatory Prepayments.........................................43
2.6 Reduction of Commitments.............................................43
2.7 Method of Borrowing..................................................43
2.8 Method of Selecting Types and Interest Periods for Advances;
Determination of Applicable Margins...............................44
(a) Method of Selecting Types and Interest Periods for Advances...44
(b) Determination of Applicable Margins, Applicable Letter
of Credit Fee and Applicable Facility Fee...................44
2.9 Minimum Amount of Each Advance.......................................46
2.10 Method of Selecting Types and Interest Periods for Conversion and
Continuation of Advances..........................................46
(A) Right to Convert..............................................46
(B) Automatic Conversion and Continuation.........................46
(C) No Conversion Post-Default or Post-Unmatured Default..........47
(D) Conversion/Continuation Notice................................47
2.11 Default Rate........................................................47
2.12 Method of Payment...................................................47
2.13 Notes, Telephonic Notices...........................................48
2.14 Promise to Pay; Interest and Fees; Interest Payment Dates; Interest
and Fee Basis; Taxes; Loan and Control Accounts...................49
(A) Promise to Pay................................................49
(B) Interest Payment Dates........................................49
(C) Fees..........................................................49
(D) Interest and Fee Basis........................................49
(E) Taxes.........................................................50
ii
<PAGE> 3
(F) Loan Account..................................................53
(G) Control Account...............................................54
(H) Entries Binding...............................................54
2.15 Notification of Advances, Interest Rates, Prepayments and Aggregate
Revolving Loan Commitment Reductions...............................54
2.16 Lending Installations...............................................54
2.17 Non-Receipt of Funds by the Administrative Agent....................54
2.18 Termination Date....................................................55
2.19 Replacement of Certain Lenders......................................55
2.20 Letter of Credit Facility...........................................56
2.21 Letter of Credit Participation......................................57
2.22 Reimbursement Obligation............................................57
2.23 Cash Collateral.....................................................58
2.24 Letter of Credit Fees...............................................59
2.25 Indemnification; Exoneration........................................59
2.26 Judgment Currency...................................................60
2.27 Market Disruption; Deposits Unavailable, Interest Rate
Unascertainable or Inadequate; Impracticability....................61
ARTICLE III: CHANGE IN CIRCUMSTANCES..........................................62
3.1 Yield Protection.....................................................62
3.2 Changes in Capital Adequacy Regulations..............................63
3.3 Availability of Types of Advances....................................63
3.4 Funding Indemnification..............................................64
3.5 Lender Statements; Survival of Indemnity.............................64
ARTICLE IV: CONDITIONS PRECEDENT..............................................64
4.1 Initial Advances and Letters of Credit...............................64
4.2 Each Advance and Letter of Credit....................................65
4.3 Conditions Precedent to Initial Borrowing by each Subsidiary
Borrower............................................................65
ARTICLE V: REPRESENTATIONS AND WARRANTIES.....................................66
5.1 Organization; Powers.................................................66
5.2 Authority............................................................66
5.3 No Conflict; Governmental Consents...................................67
5.4 Financial Statements.................................................67
5.5 No Material Adverse Change...........................................68
(A) Tax Examinations..............................................68
(B) Payment of Taxes..............................................68
5.7 Litigation; Loss Contingencies and Violations........................68
5.8 Subsidiaries.........................................................69
5.9 ERISA................................................................69
iii
<PAGE> 4
5.10 Accuracy of Information.............................................70
5.11 Securities Activities...............................................70
5.12 Material Agreements.................................................70
5.13 Compliance with Laws................................................71
5.14 Assets and Properties...............................................71
5.15 Statutory Indebtedness Restrictions.................................71
5.16 Post-Retirement Benefits............................................71
5.17 Insurance...........................................................71
5.18 Contingent Obligations..............................................71
5.19 Restricted Junior Payments..........................................72
5.20 Labor Matters.......................................................72
5.21 Environmental Matters...............................................72
5.22 Foreign Employee Benefit Matters....................................73
5.23 Year 2000 Issues....................................................73
ARTICLE VI: COVENANTS.........................................................74
6.1 Reporting............................................................74
(A) Financial Reporting...........................................74
(B) Notice of Default.............................................75
(C) Lawsuits......................................................75
(D) Insurance.....................................................76
(E) ERISA Notices.................................................78
(G) Other Indebtedness............................................78
(H) Other Reports.................................................78
(I) Environmental Notices.........................................78
(J) Year 2000 Information.........................................78
(K) Other Information.............................................79
6.2 Affirmative Covenants................................................79
(A) Existence, Etc................................................79
(B) Powers........................................................79
(C) Compliance with Laws, Etc.....................................79
(D) Payment of Taxes and Claims; Tax Consolidation................79
(E) Insurance.....................................................80
(F) Inspection of Property; Books and Records; Discussions........80
(G) Insurance and Condemnation Proceeds...........................81
(H) ERISA Compliance..............................................81
(I) Maintenance of Property.......................................81
(J) Environmental Compliance......................................82
(K) Use of Proceeds...............................................82
(L) Foreign Employee Benefit Compliance...........................82
(M) Additional Guarantors/Pledge of Capital Stock.................82
(N) Year 2000 Issues..............................................83
iv
<PAGE> 5
6.3 Negative Covenants...................................................83
(A) Indebtedness; Subsidiary Indebtedness............................83
(B) Sales of Assets..................................................84
(C) Liens............................................................85
(D) Investments......................................................85
(E) Contingent Obligations...........................................86
(F) Restricted Junior Payments.......................................86
(G) Conduct of Business; Subsidiaries; Acquisitions..................87
(H) Transactions with Shareholders and Affiliates....................88
(I) Restriction on Fundamental Changes...............................88
(J) Sales and Leasebacks.............................................89
(K) Margin Regulations...............................................89
(L) ERISA............................................................89
(M) Issuance of Equity Interests.....................................90
(N) Organizational Documents.........................................90
(O) Other Indebtedness...............................................90
(P) Fiscal Year......................................................90
(Q) Hedging Obligations..............................................90
6.4 Financial Covenants..................................................91
(A) Defined Terms for Financial Covenants............................91
(B) Fixed Charge Coverage Ratio......................................92
(C) Minimum Consolidated Book Equity.................................92
(D) Maximum Leverage and Senior Debt Ratios..........................92
(E) Domestic Asset Coverage Ratio....................................93
(F) Capital Expenditures.............................................93
6.5 Corporate Restructuring..............................................94
ARTICLE VII: DEFAULTS.........................................................94
7.1 Defaults.............................................................94
ARTICLE VIII: ACCELERATION, DEFAULTING LENDERS; WAIVERS, AMENDMENTS
AND REMEDIES.............................................................98
8.1 Remedies.............................................................98
(a) Termination of Commitments; Acceleration.........................98
(b) Rescission.......................................................98
(c) Enforcement......................................................98
8.2 Defaulting Lender....................................................99
8.3 Amendments..........................................................100
8.4 Preservation of Rights..............................................101
ARTICLE IX: GUARANTEE........................................................102
9.1 Guarantee; Modifications to Obligations.............................102
9.2 Waivers.............................................................102
v
<PAGE> 6
9.3 Guarantee Unconditional.............................................102
9.4 Extensions and Other Modifications of Obligations...................103
9.5 No Marshalling; Reinstatement of Guarantee..........................104
9.6 Agreement to Pay Obligations; Currency Issues.......................104
9.7 Subordination of Subrogation........................................104
9.8 Election of Remedies................................................105
9.9 Limitation..........................................................106
9.9 Contribution with Respect to Guaranty Obligations...................106
9.10 Liability Cumulative...............................................107
9.11 No Revocation; Term of Guarantee...................................107
ARTICLE X: GENERAL PROVISIONS................................................107
10.1 Survival of Representations........................................107
10.2 Governmental Regulation............................................108
10.3 Performance of Obligations.........................................108
10.4 Headings...........................................................109
10.5 Entire Agreement...................................................109
10.6 Several Obligations; Benefits of this Agreement....................109
10.7 Expenses; Indemnification..........................................109
(A) Expenses......................................................109
(B) Indemnity.....................................................110
(C) Waiver of Certain Claims; Settlement of Claims................111
(D) Survival of Agreements........................................111
10.8 Numbers of Documents...............................................111
10.9 Accounting.........................................................111
10.10 Severability of Provisions........................................111
10.11 Nonliability of Lenders...........................................111
10.12 GOVERNING LAW.....................................................111
10.13 CONSENT TO JURISDICTION; SERVICE OF PROCESS; JURY TRIAL...........112
(A) EXCLUSIVE JURISDICTION........................................112
(B) OTHER JURISDICTIONS...........................................112
(C) SERVICE OF PROCESS; VENUE.....................................113
(D) WAIVER OF JURY TRIAL..........................................113
(E) WAIVER OF BOND................................................113
(F) ADVICE OF COUNSEL.............................................114
10.14 Subordination of Intercompany Indebtedness........................114
10.15 No Strict Construction............................................115
ARTICLE XI: THE ADMINISTRATIVE AGENT.........................................115
11.1 Appointment; Nature of Relationship................................115
11.2 Powers.............................................................116
11.3 General Immunity...................................................116
11.4 No Responsibility for Loans, Creditworthiness, Collateral,
Recitals, Etc....................................................116
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11.5 Action on Instructions of Lenders..................................116
11.6 Employment of Agents and Counsel...................................117
11.7 Reliance on Documents; Counsel.....................................117
11.8 The Administrative Agent's Reimbursement and Indemnification.......117
11.9 Rights as a Lender.................................................117
11.10 Lender Credit Decision............................................118
11.11 Successor Administrative Agent....................................118
11.12 Collateral Documents..............................................118
11.13. No Duties Imposed Upon Arranger or Syndication Agent.............118
ARTICLE XII: SETOFF; RATABLE PAYMENTS........................................119
12.1 Setoff.............................................................119
12.2 Ratable Payments...................................................119
12.3 Application of Payments............................................119
12.4 Relations Among Lenders............................................120
ARTICLE XIII: BENEFIT OF AGREEMENT; ASSIGNMENTS;
PARTICIPATIONS..........................................................121
13.1 Successors and Assigns.............................................121
13.2 Participations.....................................................121
(A) Permitted Participants; Effect..................................121
(B) Voting Rights...................................................122
(C) Benefit of Setoff...............................................122
13.3 Assignments........................................................122
(A) Permitted Assignments...........................................122
(B) Effect; Effective Date..........................................123
(C) The Register....................................................123
13.4 Confidentiality....................................................123
13.5 Dissemination of Information.......................................124
ARTICLE XIV: NOTICES.........................................................124
14.1 Giving Notice......................................................124
14.2 Change of Address..................................................125
ARTICLE XV: COUNTERPARTS.....................................................125
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EXHIBITS AND SCHEDULES
Exhibits
EXHIBIT A -- Form of Alternate Currency Addendum (Definitions)
EXHIBIT B -- Form of Compliance Certificate
(Definitions, ss.ss. 4.2, 6.1(A)(iii))
EXHIBIT C -- Form of Guarantor Assumption Letter
(Definitions)
EXHIBIT D -- Commitments
(Definitions)
EXHIBIT E -- Form of Master Revolving Note
(Definitions)
EXHIBIT F -- Form of Individual Revolving Note
(Definitions)
EXHIBIT G -- Form of Swing Line Loan Note
(Definitions)
EXHIBIT H -- Form of Assignment Agreement
(ss.ss. 2.17, 13.3)
EXHIBIT I -- Form of Officer's Certificate
(ss.ss. 4.2, 6.1(A)(iii))
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<PAGE> 9
Schedules
Schedule 1.1.1 -- Existing Letters of Credit (Definitions)
Schedule 1.1.2 -- Permitted Existing Contingent Obligations (Definitions)
Schedule 1.1.3 -- Permitted Existing Indebtedness (Definitions)
Schedule 1.1.4 -- Permitted Existing Investments (Definitions)
Schedule 1.1.5 -- Permitted Existing Liens (Definitions)
Schedule 2.3 -- Forced-Draw Provisions re: Alternate Currency Letters
of Credit (ss.2.3 and ss.2.4)
Schedule 5.3 -- Conflicts; Governmental Consents (ss.5.3)
Schedule 5.4(A) -- Financial Statements (ss.5.4 (A))
Schedule 5.7 -- Litigation; Loss Contingencies (ss.5.7)
Schedule 5.8 -- Subsidiaries (ss.5.8)
Schedule 5.17 -- Insurance (ss.ss.5.17, 6.2(E))
Schedule 5.20 -- Labor Matters; Compensation Agreements (ss.5.20)
Schedule 5.21 -- Environmental Matters (ss.5.21)
Schedule 6.3(F) -- Permitted Restricted Junior Payments (ss.6.3(F))
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<PAGE> 10
AMENDED AND RESTATED MULTICURRENCY CREDIT AGREEMENT
This Amended and Restated Multicurrency Credit Agreement dated as of
May 13, 1998 is entered into among Brightpoint, Inc., a Delaware corporation,
Brightpoint International Ltd., a Delaware corporation, any Subsidiary Borrowers
(as defined herein) which are now or may hereafter become a party to an
Alternate Currency Addendum from time to time, the Guarantors (as defined
herein) which are now or may hereafter become a party hereto from time to time,
the financial institutions from time to time a party hereto as Lenders, whether
by execution of this Agreement or an assignment and acceptance pursuant to
Section 13.3, NBD Bank, N.A., in its capacity as Administrative Agent for itself
and the other Lenders and Bank One, Indiana, National Association, in its
capacity as Syndication Agent to amend and restate the "Original Credit
Agreement" (as defined below), which is hereby amended and restated in its
entirety. The parties hereto agree as follows:
WITNESSETH:
WHEREAS, the Borrowers have requested and the Agents and the Lenders have
agreed to amend the Original Credit Agreement (as defined below);
WHEREAS, the Borrowers, the Lenders and the Agents have agreed to enter
into this Agreement in order to (i) amend and restate the Original Credit
Agreement in its entirety; (ii) re-evidence the Obligations, which shall be
repayable in accordance with the terms of this Agreement; and (iii) set forth
the terms and conditions under which the Lenders will, from time to time, make
loans and extend other financial accommodations to or for the benefit of the
Borrowers; and
WHEREAS, it is the intention of the parties to this Agreement that this
Agreement not constitute a novation and that, from and after the Closing Date,
the Original Credit Agreement shall be amended and restated hereby and all
references herein to "hereunder," "hereof," or words of like import and all
references in any other Loan Document to the "Credit Agreement" or words of like
import shall mean and be a reference to the Original Credit Agreement as amended
and restated hereby (and any section references to the Original Credit Agreement
shall refer to the applicable equivalent provision set forth herein although the
section number thereof may have changed);
NOW, THEREFORE, in consideration of the terms and conditions contained
herein, and of any loans or extensions of credit heretofore, now or hereafter
made to or for the benefit of the Borrowers by the Lenders and the Agents, the
parties hereto agree as follows:
<PAGE> 11
ARTICLE I: DEFINITIONS
1.1 Certain Defined Terms. In addition to the terms defined in other
sections of this Agreement, the following terms used in this Agreement shall
have the following meanings, applicable both to the singular and the plural
forms of the terms defined:
As used in this Agreement:
"Account Debtor" means the account debtor or obligor with respect to any of
the Receivables and/or the prospective purchaser with respect to any contract
right, and/or any party who enters into or proposes to enter into any contract
or other arrangement with a Borrower.
"Acquisition" means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which a Borrower or any
Subsidiary of a Borrower (i) acquires any going business or all or substantially
all of the assets of any firm, corporation or division thereof, whether through
purchase of assets, merger or otherwise or (ii) directly or indirectly acquires
(in one transaction or as of the most recent transaction in a series of
transactions) at least a majority (in number of vote) of the securities of a
corporation which have ordinary voting power for the election of directors
(other than securities having such power only by reason of the happening of a
contingency) or a majority (by percentage of voting power), of the membership,
ownership or other equity interests in a limited liability company or of the
outstanding partnership interests of a partnership.
"AC Buying Lender" is defined in Section 2.4(f).
"AC Selling Lender" is defined in Section 2.4(f).
"Administrative Agent" means NBD in its capacity as contractual
representative for itself and the Lenders pursuant to Article XI hereof and any
successor Administrative Agent appointed pursuant to Article XI hereof.
"Advance" means a borrowing consisting of simultaneous Revolving Loans of
the same Type made to a Borrower by each of the Lenders pursuant to Section 2.1,
and for, in the case of Eurocurrency Rate Advances, the same currency and the
same Interest Period.
"Affected Lender" is defined in Section 2.19 hereof.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person is the
"beneficial owner" (as defined in Rule 13d-3 under the Securities Exchange Act)
of greater than ten percent (10%) or more of any class of voting Capital Stock
(or other voting interests) of the controlled Person or possesses, directly or
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<PAGE> 12
indirectly, the power to direct or cause the direction of the management or
policies of the controlled Person, whether through ownership of Equity
Interests, by contract or otherwise. In addition, each director of a Borrower or
any Subsidiary of a Borrower shall be deemed to be an Affiliate of each
Borrower.
"Agents" means the Administrative Agent and the Syndication Agent.
"Agreed Currencies" means (i) Dollars; (ii) so long as such currencies
remain Eligible Currencies, Sterling, Hong Kong Dollars, Australian Dollars,
French Francs, Deutsche Marks, Canadian Dollars, Swiss Francs, Japanese Yen,
Dutch Guilders, Italian Lire and Swedish Kroner; (iii) upon and after the Euro
Implementation Date, the Euro only for so long as the Euro is and remains an
Eligible Currency; and (iv) any other Eligible Currency which Brightpoint
requests the Administrative Agent to include as an Agreed Currency hereunder and
which is acceptable to one-hundred percent (100%) of the Lenders; provided that
the Administrative Agent shall promptly notify each Lender of each such request
and each Lender shall be deemed not to have agreed to each such request unless
its written consent thereto has been received by the Administrative Agent within
ten (10) Business Days from the date of such notification by the Administrative
Agent to such Lender.
"Aggregate Commitment" means, at any time, the sum of the Revolving Loan
Commitments plus the Alternate Currency Commitment, as adjusted from time to
time pursuant to the terms hereof. The initial Aggregate Commitment is Two
Hundred Twenty-Five Million and 00/100 Dollars ($225,000,000).
"Aggregate Revolving Loan Commitment" means the aggregate of the Revolving
Loan Commitments of all the Lenders, as adjusted from time to time pursuant to
the terms hereof. The initial Aggregate Revolving Loan Commitment is Two Hundred
Million and 00/100 Dollars ($200,000,000.00).
"Agreement" means this Amended and Restated Multicurrency Credit Agreement,
as it may be amended, restated or otherwise modified and in effect from time to
time.
"Agreement Accounting Principles" means generally accepted accounting
principles as in effect as of the date of this Agreement in the United States,
applied in a manner consistent with that used by Brightpoint and its
consolidated Subsidiaries in the preparation of its audited consolidated
financial statements for the year ended December 31, 1996. If any changes in
generally accepted accounting principles are hereafter required or permitted and
are adopted by Brightpoint or any of its Subsidiaries with the agreement of its
independent certified public accountants and such changes result in a change in
the method of calculation of any of the financial covenants, restrictions or
standards herein or in the related definitions or terms used therein ("Covenant
Accounting Changes"), the parties hereto agree to enter into negotiations, in
good faith, in order to amend such provisions in a credit neutral manner so as
to reflect equitably
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<PAGE> 13
such changes with the desired result that the criteria for evaluating
Brightpoint's consolidated financial condition shall be the same after such
changes as if such changes had not been made; provided, however, that no
Covenant Accounting Change shall be given effect in such calculations until such
provisions are amended in a manner reasonably satisfactory to the Required
Lenders. If such amendment is entered into, all references in this Agreement to
Agreement Accounting Principles shall mean generally accepted accounting
principles as of the date of such amendment applied in a manner consistent with
that used by Brightpoint and its consolidated Subsidiaries in the preparation of
its audited consolidated financial statements for the year ended December 31,
1996 except as agreed in connection with the Covenant Accounting Changes set
forth in such an amendment and together with any changes in generally accepted
accounting principles after the date of such amendment which are not Covenant
Accounting Changes.
"Alternate Base Rate" means, for any day, a fluctuating interest rate per
annum (rounded upwards, if necessary, to the next 1/16 of 1%) as shall be in
effect from time to time, which rate per annum shall at all times be equal to
the greatest of (a) the Prime Rate in effect on such day; and (b) the sum of
one-half of one percent (0.50%) and the Federal Funds Effective Rate in effect
on such day. For purposes hereof, "Prime Rate" shall mean the rate of interest
per annum publicly announced from time to time by NBD as its prime rate (it
being acknowledged that such announced rate may not necessarily be the lowest
rate charged by NBD to any of its customers) in effect at its principal office
in Indianapolis, Indiana; each change in the Prime Rate shall be effective on
the date such change is publicly announced as being effective. "Federal Funds
Effective Rate" shall mean, for any day, a fluctuating interest rate per annum
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers, as published on the next succeeding Business Day by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for such day on such
transactions received by NBD from three Federal funds brokers of recognized
standing selected by the Administrative Agent. If for any reason the
Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable to ascertain the Federal
Funds Effective Rate for any reason, including the inability or failure of the
Administrative Agent to obtain sufficient quotations in accordance with the
terms hereof, the Alternate Base Rate shall be determined without regard to
clause (b) of the first sentence of this definition until the circumstances
giving rise to such inability no longer exist. Any change in the Alternate Base
Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall
be effective on the effective date of such change.
"Alternate Currency" means any currency which Brightpoint requests the
Alternate Currency Lender to include as an Alternate Currency hereunder and
which is acceptable to the Alternate Currency Lender; provided, that no such
currency shall be an Alternate Currency hereunder until an Alternate Currency
Addendum establishing such currency as an Alternate Currency has been executed
by a Subsidiary Borrower and the Alternate Currency Lender and
4
<PAGE> 14
acknowledged by Brightpoint and each Guarantor. If, after the Alternate Currency
Lender agrees to make Alternate Currency Loans in an Alternate Currency,
currency control or other exchange regulations are imposed in the country in
which such Alternate Currency is issued with the result that different types of
such currency are introduced, such country's currency is, in the determination
of the Alternate Currency Lender, no longer readily available or freely traded
or as to which, in the determination of the Alternate Currency Lender, an
Equivalent Amount is not readily calculable, then the Alternate Currency Lender
shall promptly notify the Lenders and Brightpoint, such country's currency shall
no longer be an Alternate Currency until such time as the Alternate Currency
Lender agrees to reinstate such country's currency as an Alternate Currency and
promptly, but in any event within five (5) Business Days of receipt of such
notice from the Alternate Currency Lender, the Subsidiary Borrowers with respect
to such Alternate Currency shall repay all Loans in such affected currency or
convert such Loans into Loans in Dollars or another Alternate Currency as
applicable, subject to the other terms contained in Article II.
"Alternate Currency Addendum" means an addendum substantially in the form
of Exhibit A entered into by one or more of the Subsidiary Borrowers and the
Alternate Currency Lender and acknowledged by Brightpoint and each Guarantor.
"Alternate Currency Availability" means, at any particular time, the amount
by which the Alternate Currency Commitment exceeds the Alternate Currency
Obligations.
"Alternate Currency Commitment" means, with respect to the Alternate
Currency Lender, the obligation of the Alternate Currency Lender to make
Alternate Currency Loans or issue Alternate Currency Letters of Credit under
Section 2.3 and to purchase Revolving Loans and participations in Letters of
Credit under Section 2.4 not exceeding the Dollar Amount of the Maximum
Aggregate Alternate Currency Amount, as such amount may be modified from time to
time pursuant to the terms of this Agreement.
"Alternate Currency Credit" means either an Alternate Currency Loan or an
Alternate Currency Letter of Credit, or both.
"Alternate Currency Documents" means any Alternate Currency Addendum and,
with respect to the Alternate Currency Loans to be made to or Alternate Currency
Letters of Credit to be issued for the account of the applicable Subsidiary
Borrower party thereto, such other loan documentation such as a loan agreement,
overdraft agreement or credit agreement, indenture, promissory note, letter of
credit application or other instrument or document evidencing the Alternate
Currency Loans to be made to or Alternate Currency Letters of Credit issued for
the account of such Subsidiary Borrower by the Alternate Currency Lender, in
each case, in form and substance acceptable to the Alternate Currency Lender.
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<PAGE> 15
"Alternate Currency Lender" means ABN AMRO Bank N.V. and, after any
Conversion Date, any Lender who has purchased Alternate Currency Credits under
Section 2.4(f). If any agency or Affiliate of the Alternate Currency Lender
shall be a party to an Alternate Currency Addendum, such agency or Affiliate
shall, to the extent of any commitment extended and any Alternate Currency Loans
made or Alternate Currency Letters of Credit issued by it, have all the rights
of the Alternate Currency Lender hereunder; provided, however, that the
Alternate Currency Lender shall to the exclusion of such agency or Affiliate,
continue to have all the voting and consensual rights vested in it by the terms
hereof.
"Alternate Currency Letter of Credit" means any letter of credit issued for
the account of a Subsidiary Borrower by the Alternate Currency Lender or one of
its Affiliates pursuant to Section 2.3, an Alternate Currency Addendum and any
other Alternate Currency Documents.
"Alternate Currency Loan" means any loan denominated in an Alternate
Currency made by the Alternate Currency Lender to a Subsidiary Borrower pursuant
to Section 2.3, an Alternate Currency Addendum and any other Alternate Currency
Documents and shall include any reimbursement obligations of a Subsidiary
Borrower arising out of the presentment, honor and drawing of any Alternate
Currency Letter of Credit.
"Alternate Currency Obligations" means, at any particular time, the sum of
the outstanding principal amount of the Alternate Currency Loans at such time
plus the face amount of any undrawn Alternate Currency Letters of Credit.
"Applicable Facility Fee" as at any date of determination, shall be the
rate per annum then applicable in the determination of the amount payable under
Section 2.14(C) with respect to the Aggregate Revolving Loan Commitment and the
Alternate Currency Commitment, determined in accordance with the provisions of
Section 2.8(b).
"Applicable Fixed Rate Margin" as at any date of determination, shall be
the rate per annum then applicable to Eurocurrency Rate Loans, determined in
accordance with the provisions of Section 2.8(b).
"Applicable Floating Rate Margin" as at any date of determination, shall be
the rate per annum then applicable to Base Rate Loans, determined in accordance
with the provisions of Section 2.8(b).
"Applicable Letter of Credit Fee" as at any date of determination, shall be
the rate per annum then applicable in the determination of the amount payable
under Section 2.24 with respect to Facility Letters of Credit, determined in
accordance with the provisions of Section 2.8(b).
"Applicable Margin(s)" is defined in Section 2.8(b).
6
<PAGE> 16
"Arranger" means First Chicago Capital Markets, Inc.
"Australian Dollars" means the lawful money of Australia.
"Authorized Officer" means any of the chief operating officer, chief
financial officer, controller and treasurer of a Borrower, acting singly.
"Base Rate" means, for any day for any Loan, a rate per annum equal to (i)
the Alternate Base Rate for such day plus (ii) the Applicable Floating Rate
Margin applicable to such Loan, changing when and as the Alternate Base Rate
changes.
"Base Rate Advance" means an Advance which bears interest at the Base Rate.
"Base Rate Loan" means a Loan, or portion thereof, which bears interest at
the Base Rate.
"Benefit Plan" means a defined benefit plan as defined in Section 3(35) of
ERISA (other than a Multiemployer Plan) in respect of which Brightpoint or any
other member of the Controlled Group is, or within the immediately preceding six
(6) years was, an "employer" as defined in Section 3(5) of ERISA.
"Borrower" means, as applicable, Brightpoint, BPI and any Subsidiary
Borrower and their respective successors and assigns.
"Borrowing Date" means a date on which an Advance, an Alternate Currency
Credit or a Swing Line Loan is made hereunder.
"Borrowing Notice" is defined in Section 2.8 hereof.
"BPI" means Brightpoint International Ltd., a Delaware corporation and a
wholly-owned Subsidiary of Brightpoint, and its successors and assigns,
including a debtor-in-possession on behalf of Brightpoint International Ltd.
"Brightpoint" means Brightpoint, Inc., a Delaware corporation, and its
successors and assigns, including a debtor-in-possession on behalf of
Brightpoint, Inc.
"Brightpoint BV1" means Brightpoint International Holdings, B.V., a private
limited liability company formed under the laws of the Netherlands.
"Brightpoint BV2" means Brightpoint Holdings B.V., a private limited
liability company formed under the laws of the Netherlands.
7
<PAGE> 17
"Business Day" means, except as otherwise agreed between the Alternate
Currency Lender and any Applicable Subsidiary Borrower provided under the
applicable Alternate Currency Documents with respect to Alternate Currency
Credits made to such Subsidiary Borrower: (i) with respect to any borrowing,
payment or rate selection of Alternate Currency Credits or Revolving Loans
(other than Revolving Loans denominated in Euro) bearing interest at the Fixed
Rate, a day (other than a Saturday or Sunday) on which banks are open for
business in Indianapolis, Indiana and on which dealings in United States Dollars
and the other Agreed Currencies or Alternate Currencies are carried on in the
relevant interbank market; (ii) with respect to any borrowing, payment or rate
selection of Revolving Loans denominated in Euro, a day (other than a Saturday
or Sunday) on which a suitable clearing system for the Euro is open for
business, as determined by the Administrative Agent; and (iii) for all other
purposes a day (other than a Saturday or Sunday) on which banks are open for
business in Indianapolis, Indiana.
"Calculation Date" means (i) with respect to any Revolving Loan or Facility
Letter of Credit in any currency other than Dollars, the Business Day of the
making of such Revolving Loan or the issuance of the Facility Letter of Credit
with respect to the Agreed Currency in which such Revolving Loan is being made
or Facility Letter of Credit is being issued; (ii) with respect to any Alternate
Currency Credit, the Business Day of the making of such Alternate Currency
Credit with respect to the Alternate Currency in which such Alternate Currency
Credit is being made; (iii) with respect to Revolving Loans and Facility Letters
of Credit, any other Business Day selected at the option of the Administrative
Agent or at the direction of the Required Lenders; (iv) with respect to
Alternate Currency Credits for any Alternate Currency, any other Business Day
selected at the option of the Alternate Currency Lender; and (v) on the date any
Conversion Notice is given pursuant to Section 2.4(b); provided, with respect to
any option exercised pursuant to clause (iii) or (iv) above, without the consent
of the Administrative Agent or Alternate Currency Lender required to calculate
the applicable Exchange Rate, the Calculation Date selected shall not be earlier
than the second (2nd) Business Day following exercise of such option.
"Canadian Dollars" means the lawful money of Canada.
"Capital Expenditures" is defined in Section 6.4(A) hereof.
"Capital Stock" means (i) in the case of a corporation, corporate stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (howsoever designated) of
corporate stock, (iii) in the case of a partnership, partnership interests
(whether general or limited) and (iv) any other interest or participation that
confers on a Person the right to receive a share of the profits and losses of,
or distributions of assets of, the issuing person, in each such case regardless
of class or designation.
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<PAGE> 18
"Capitalized Lease" of a Person means any lease of property by such Person
as lessee which would be capitalized on a balance sheet of such Person prepared
in accordance with Agreement Accounting Principles.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be capitalized
on a balance sheet of such Person prepared in accordance with Agreement
Accounting Principles.
"Cash Equivalents" means (i) marketable direct obligations issued or
unconditionally guaranteed by the government of the United States or the
government of any member of the European Union; (ii) domestic and Eurocurrency
certificates of deposit and time deposits, bankers' acceptances and Base rate
certificates of deposit issued by any commercial bank organized under the laws
of the United States, any state thereof, the District of Columbia, or its
branches or agencies or the laws of any member of the European Union and having
capital and surplus in an aggregate amount not less than $500,000,000 (fully
protected against currency fluctuations for any such deposits with a term of
more than ten (10) days); (iii) shares of money market, mutual or similar funds
having net assets in excess of $500,000,000 maturing or being due or payable in
full not more than one hundred eighty (180) days after any Borrower's
acquisition thereof and the investments of which are limited to investment grade
securities (i.e., securities rated at least Baa by Moody's Investors Service,
Inc. or at least BBB by Standard & Poor's Ratings Group) or shares of similar
funds of similar credit quality in Europe approved for such purposes by the
Administrative Agent in its sole discretion and (iv) commercial paper of United
States and foreign banks and bank holding companies and their subsidiaries and
United States and foreign finance, commercial, industrial or utility companies
which, at the time of acquisition, are rated A-1 (or better) by Standard &
Poor's Ratings Group or P-1 (or better) by Moody's Investors Services, Inc. or
commercial paper of British banks of similar credit quality approved for such
purposes by the Administrative Agent in its sole discretion; provided that the
maturities of such Cash Equivalents shall not exceed 365 days.
"Change" is defined in Section 3.2 hereof.
"Change of Control" means any of the following:
(i) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Exchange Act) is or becomes the "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a
person shall be deemed to have "beneficial ownership" of all securities
that such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of 20% or more of the combined voting power of Brightpoint's
Capital Stock ordinarily having the right to vote at an election of
directors;
(ii) during any period of 12 consecutive calendar months, individuals:
9
<PAGE> 19
(a) who were directors of Brightpoint on the first day of such
period, or
(b) whose election or nomination for election to the board of
directors of Brightpoint was recommended or approved by at
least a majority of the directors then still in office who
were directors of Brightpoint on the first day of such period,
or whose election or nomination for election was so approved,
shall cease to constitute a majority of the board of directors of
Brightpoint;
(iii) Brightpoint consolidates with or merges into another corporation
or conveys, transfers or leases all or substantially all of its property to
any Person, or any corporation consolidates with or merges into
Brightpoint, in either event pursuant to a transaction in which the
outstanding Capital Stock of Brightpoint is reclassified or changed into or
exchanged for cash, securities or other property;
(iv) Brightpoint shall cease to own, of record and beneficially, with
sole voting and dispositive power, 100% of the outstanding shares of
Capital Stock of BPI or shall cease to have the power, directly or
indirectly, to elect all of the members of the board of directors of BPI;
(v) BPI shall cease to own of record and beneficially, with sole voting
and dispositive power, 100% of the outstanding shares of Capital Stock of
Brightpoint BV1 ordinarily having the right to vote at an election of
directors or shall cease to have the power, directly or indirectly, to
elect a majority of the board of directors of Brightpoint BV1;
(vi) Brightpoint BV1 shall cease to own of record and beneficially,
with sole voting and dispositive power, 100% of the outstanding shares of
Capital Stock of Brightpoint BV2 ordinarily having the right to vote at an
election of directors or shall cease to have the power, directly or
indirectly, to elect a majority of the board of directors of Brightpoint
BV2; and
(vii) Other than as a result of a transaction otherwise expressly
permitted by the terms of this Agreement, Brightpoint shall cease to own of
record and beneficially, either directly or indirectly, with sole voting
and dispositive power, at least 80% of the outstanding shares of Capital
Stock of each other Material Subsidiary (other than those specified in
clauses (iii) through (v)) ordinarily having the right to vote at an
election of directors or shall cease to have the power, directly or
indirectly, to elect a majority of the board of directors of each such
Material Subsidiary.
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"Closing Date" means the date on which the conditions for effectiveness of
this Agreement shall have taken effect and the Original Agreement shall, by the
terms hereof, no longer be of any force or effect.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Collateral" means all property and interests in property now owned or
hereafter acquired by a Borrower or any of its Subsidiaries in or upon which a
security interest, lien or mortgage is granted to the Administrative Agent, for
the benefit of the Lenders, to secure all of the Secured Obligations, whether
under the Security Agreements, under the Trademark Security Agreement, under the
Pledge Agreements, under any of the other Collateral Documents or under any of
the other Loan Documents.
"Collateral Documents" means all agreements, instruments and documents
executed in connection with this Agreement, including, without limitation the
Security Agreements, the Trademark Security Agreement, the Pledge Agreements and
all other security agreements, loan agreements, notes, guarantees, mortgages,
subordination agreements, pledges, powers of attorney, consents, assignments,
contracts, leases, financing statements and all other written matter whether
heretofore, now, or hereafter executed by or on behalf of a Borrower or any
Subsidiary of a Borrower and delivered to the Administrative Agent or any of the
Lenders, together with all agreements and documents referred to therein or
contemplated thereby.
"Commission" means the Securities and Exchange Commission and any Person
succeeding to the functions thereof.
"Commitment" means, for each Lender, such Lender's Revolving Loan
Commitment, for the Alternate Currency Lender, its Alternate Currency Commitment
and for the Swing Line Lender, its Swing Line Loan Commitment. The Commitments
shall automatically and permanently terminate on the Termination Date.
"Compliance Certificate" means a certificate substantially in the form of
Exhibit B delivered to the Administrative Agent and each Lender by Brightpoint
pursuant to the provisions of this Agreement and covering, among other things,
its calculation of the Applicable Margins, Applicable Facility Fee, Applicable
Letter of Credit Fee, its compliance with the financial covenants contained in
Section 6.4 and certain other provisions of this Agreement.
"Consolidated Book Equity" is defined in Section 6.4(A) hereof.
"Contaminant" means any waste, pollutant, hazardous substance, toxic
substance, hazardous waste, special waste, petroleum or petroleum-derived
substance or waste, asbestos,
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polychlorinated biphenyls ("PCBs"), or any constituent of any such substance or
waste, and includes but is not limited to these terms as defined in
Environmental, Health or Safety Requirements of Law.
"Contingent Obligation", as applied to any Person, means any Contractual
Obligation, contingent or otherwise, of that Person with respect to any
Indebtedness of another or other obligation or liability of another, including,
without limitation, any such Indebtedness, obligation or liability of another
directly or indirectly guaranteed, endorsed (otherwise than for collection or
deposit in the ordinary course of business), co-made or discounted or sold with
recourse by that Person, or in respect of which that Person is otherwise
directly or indirectly liable, including Contractual Obligations (contingent or
otherwise) arising through any agreement to purchase, repurchase, or otherwise
acquire such Indebtedness, obligation or liability or any security therefor, or
to provide funds for the payment or discharge thereof (whether in the form of
loans, advances, stock purchases, capital contributions or otherwise), or to
maintain solvency, assets, level of income, or other financial condition, or to
make payment other than for value received.
"Contingent Purchase Price Obligation", as applied to any Person, means any
Contractual Obligation of such Person incurred in connection with an Acquisition
pursuant to which such Person is obligated to pay additional consideration to
the applicable seller in the form of an earnout, milestone payment, contingent
purchase price payment, or other similar performance based compensation relating
to post-Acquisition financial or operating performance of the business acquired.
"Contractual Obligation", as applied to any Person, means any provision of
any equity or debt securities issued by that Person or any indenture, mortgage,
deed of trust, security agreement, pledge agreement, guaranty, contract,
undertaking, agreement or instrument, in any case in writing, to which that
Person is a party or by which it or any of its properties is bound, or to which
it or any of its properties is subject.
"Contract Finance Receivables" means the assets of Brightpoint which arise
out of the purchase of certain equipment from customers of Brightpoint for the
purpose of selling such equipment to customers of such customers, and which
assets are characterized as "Contract Finance Receivables" on the balance sheet
of Brightpoint; provided, Brightpoint's balance sheet characterizations with
respect to Contract Finance Receivables shall be made on a basis consistent with
Brightpoint's past practices and consistent with Brightpoint's audited
consolidated balance sheet as of December 31, 1997.
"Controlled Group" means the group consisting of (i) any corporation which
is a member of the same controlled group of corporations (within the meaning of
Section 414(b) of the Code) as Brightpoint; (ii) a partnership or other trade or
business (whether or not incorporated) which is under common control (within the
meaning of Section 414(c) of the Code) with Brightpoint; and (iii) a member of
the same affiliated service group (within the
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meaning of Section 414(m) of the Code) as Brightpoint, any corporation described
in clause (i) above or any partnership or trade or business described in clause
(ii) above.
"Conversion/Continuation Notice" is defined in Section 2.10(D) hereof.
"Conversion Date" is defined in Section 2.4(b).
"Conversion Election" is defined in Section 2.4(a).
"Conversion Event" is defined in Section 2.4(a).
"Conversion Notice" means any notice of a Conversion Election or other
Conversion Event given by any Agent or the Alternate Currency Lender pursuant to
the terms of Section 2.4(b).
"Converted Loans" means any one or more Loans converted to Dollars from any
currency other than Dollars pursuant to the terms of Section 2.4(b).
"Cure Loan" is defined in Section 8.2 hereof.
"Customary Permitted Liens" means:
(i) Liens (other than Environmental Liens and Liens in favor of the
IRS or the PBGC) with respect to the payment of taxes, assessments or
governmental charges in all cases which are not yet due or which are being
contested in good faith by appropriate proceedings and with respect to
which adequate reserves or other appropriate provisions are being
maintained in accordance with Agreement Accounting Principles;
(ii) statutory Liens of landlords and Liens of suppliers, mechanics,
carriers, materialmen, warehousemen or workmen and other similar Liens
imposed by law created in the ordinary course of business for amounts not
yet due or which are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves or other
appropriate provisions are being maintained in accordance with Agreement
Accounting Principles;
(iii) Liens (other than Environmental Liens and Liens in favor of the
IRS or the PBGC) incurred or deposits made in the ordinary course of
business in connection with worker's compensation, unemployment insurance
or other types of social security benefits or to secure the performance of
bids, tenders, sales, contracts (other than for the repayment of borrowed
money), surety, appeal and performance bonds; provided that (A) all such
Liens do not in the aggregate materially detract from the value of assets
or property of any Borrower taken as a whole or materially impair the use
thereof in the operation of the businesses taken as a whole, and (B) all
Liens securing bonds to stay
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judgments or in connection with appeals that do not secure at any time
an aggregate amount exceeding $1,000,000;
(iv) Liens arising with respect to zoning restrictions, easements,
licenses, reservations, covenants, rights-of-way, utility easements,
building restrictions and other similar charges or encumbrances on the use
of real property which do not interfere with the ordinary conduct of the
business of any Borrower or any Subsidiary of any Borrower;
(v) Liens of attachment or judgment with respect to judgments, writs
or warrants of attachment, or similar process against any Borrower or any
Subsidiary of any Borrower which do not constitute a Default under Section
7.1(h);
(vi) Liens arising from leases, subleases or licenses granted to
others which do not interfere in any material respect with the business of
any Borrower or any Subsidiary of any Borrower; and
(vii) any interest or title of the lessor in the property subject to
any operating lease entered into by any Borrower or any Subsidiary of any
Borrower in the ordinary course of business.
"Default" means an event described in Article VII hereof.
"Deutsche Marks" or "DM" means the lawful money of the Republic of Germany.
"Disqualified Subsidiary" means any Subsidiary of Brightpoint other than
(i) BPI, (ii) Brightpoint BV1, (iii) any Subsidiary of Brightpoint BV1 or (iv)
any Subsidiary Borrower.
"Disqualified Subsidiary Investment" means the sum of (a) all intercompany
loans made on or after the Original Closing Date from any Borrower to any
Disqualified Subsidiary of Brightpoint; (b) all Investments made on or after the
Original Closing Date by any Borrower in any Disqualified Subsidiary of
Brightpoint; and (c) an amount equal to the net benefit derived by the
Disqualified Subsidiaries of Brightpoint resulting from any non-arms length
transactions between the Borrowers, on the one hand, and such Disqualified
Subsidiaries, on the other hand.
"DOL" means the United States Department of Labor and any Person succeeding
to the functions thereof.
"Dollar" or "$" means the lawful money of the United States of America.
"Dollar Amount" of any currency at any date shall mean (i) the amount of
such currency if such currency is Dollars or (ii) the Equivalent Amount of
Dollars if such currency is any currency other than Dollars, calculated on the
basis of the then applicable Exchange Rate.
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"Domestic Asset Coverage Ratio" is defined in Section 6.4(E).
"Domestic Subsidiary" shall mean a Subsidiary of the Borrower formed
pursuant to the laws of any state of the United States, the District of
Columbia or any territory of the United States.
"Dutch Guilders" means the lawful money of The Netherlands.
"EBITDA" is defined in Section 6.4(A) hereof.
"Eligible Currency" means any currency other than Dollars that is readily
available, freely traded, in which deposits are customarily offered to banks in
the London interbank market, convertible into Dollars in the international
interbank market and as to which an Equivalent Amount may be readily
calculated. If, after the designation by the Lenders of any currency as an
Agreed Currency, currency control or other exchange regulations are imposed in
the country in which such currency is issued with the result that different
types of such currency are introduced, such country's currency is, in the
determination of the Administrative Agent, no longer readily available or
freely traded or as to which, in the determination of the Administrative Agent,
an Equivalent Amount is not readily calculable, then the Administrative Agent
shall promptly notify the Lenders and Brightpoint, such country's currency
shall no longer be an Agreed Currency until such time as all of the Lenders
agree to reinstate such country's currency as an Agreed Currency and promptly,
but in any event within five (5) Business Days of receipt of such notice from
the Administrative Agent, the Borrowers with respect to such Agreed Currency
shall repay all Loans in such affected currency or convert such Loans into
Loans in Dollars or another Agreed Currency as applicable, subject to the other
terms contained in Article II.
"Environmental, Health or Safety Requirements of Law" means all
Requirements of Law derived from or relating to federal, state and local laws
or regulations relating to or addressing pollution or protection of the
environment, or protection of worker health or safety, including, but not
limited to, the Comprehensive Environmental Response, Compensation and
Liability Act, 42 U.S.C. ss. 9601 et seq., the Occupational Safety and Health
Act of 1970, 29 U.S.C. ss. 651 et seq., and the Resource Conservation and
Recovery Act of 1976, 42 U.S.C. ss. 6901 et seq., in each case including any
amendments thereto, any successor statutes, and any regulations or guidance
promulgated thereunder, and any state or local equivalent thereof.
"Environmental Lien" means a lien in favor of any Governmental Authority
for (a) any liability under Environmental, Health or Safety Requirements of
Law, or (b) damages arising from, or costs incurred by such Governmental
Authority in response to, a Release or threatened Release of a Contaminant into
the environment.
"Environmental Property Transfer Act" means any applicable requirement of
law that conditions, restricts, prohibits or requires any notification or
disclosure triggered by the closure
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<PAGE> 25
of any property or the transfer,sale or lease of any property or deed or title
for any property for environmental reasons, including, but not limited to, any
so-called "Industrial Site Recovery Act" or "Responsible Property Transfer Act."
"Equipment" means all of the present and future (i) equipment, including,
without limitation, machinery, manufacturing, distribution, selling, data
processing and office equipment, assembly systems, tools, molds, dies, fixtures,
appliances, furniture, furnishings, vehicles, vessels, aircraft, aircraft
engines, and trade fixtures, (ii) other tangible personal property (other than
the Inventory), and (iii) any and all accessions, parts and appurtenances
attached to any of the foregoing or used in connection therewith, and any
substitutions therefor and replacements, products and proceeds thereof owned by
Brightpoint or any of the other Borrowers.
"Equity Interests" means Capital Stock and all warrants, options purchase
rights, conversion or exchange rights, other rights to acquire Capital Stock and
all voting rights, calls or claims of any character with respect thereto (but
excluding any debt security that is convertible into, or exchangeable for,
Capital Stock).
"Equivalent Amount" of any currency with respect to any amount of Dollars
at any date means the equivalent in such currency of such amount of Dollars,
calculated on the basis of the then applicable Exchange Rate rounded up to the
nearest incremental amount of such currency as determined by the Administrative
Agent from time to time.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time including (unless the context otherwise requires) any
rules or regulations promulgated thereunder.
"Euro" means the euro referred to in the Council Regulation (EC) No.
1103/97 dated 17 June 1997 passed by the Council of the European Union, or, if
different, the then lawful currency of the member states of the European Union
that participate in the third stage of the Economic and Monetary Union.
"Euro Implementation Date" means the first date (currently expected to be
January 1, 1999) on which the Euro becomes the currency of some or all of the
member states of the European Union.
"Eurocurrency Base Rate" means, with respect to any Eurocurrency Rate
Advance for any specified Interest Period, the rate at which deposits in the
applicable Agreed Currency are offered by the Administrative Agent to
first-class banks in the London interbank market (or the Paris interbank market
in the event the Agreed Currency is Sterling) at approximately 11 a.m. (London
time or Paris time, as applicable) two Business Days prior to the first day of
such Interest Period, in the approximate amount of the pro rata share of the
Administrative Agent of such Eurocurrency Advance and having a maturity
approximately equal to such Interest Period.
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"Eurocurrency Payment Office" of the Administrative Agent means, for each
of the Agreed Currencies, the office, branch or affiliate of the Administrative
Agent, specified as the "Eurocurrency Payment Address" for such currency on the
signature page for each Lender hereto or such other office, branch, affiliate
or correspondent bank of the Administrative Agent, as it may from time to time
specify to the Borrowers and each Lender as its Eurocurrency Payment Office.
"Eurocurrency Rate" means, with respect to a Eurocurrency Rate Advance for
the relevant Interest Period, the sum of (a) (i) the Eurocurrency Base Rate
divided by (ii) one minus the Reserve Requirement (expressed as a decimal)
applicable to such Interest Period plus (b) the percentage determined in
accordance with Section 2.8(b) to be the Applicable Fixed Rate Margin in
connection with Eurocurrency Rate Loans.
"Eurocurrency Rate Advance" means an Advance which bears interest at the
Eurocurrency Rate.
"Eurocurrency Rate Loan" means a Loan, or portion thereof, which bears
interest at the Eurocurrency Rate.
"Exchange Rate" means with respect to any Eligible Currency or Alternate
Currency on a particular date, the rate at which such Eligible Currency or
Alternate Currency may be exchanged into Dollars, calculated on the basis of
the arithmetical mean of the buy and sell spot rates of exchange of the
Administrative Agent or the Alternate Currency Lender, as applicable, in the
London interbank market (or other market where the Administrative Agent's or
the Alternate Currency Lender's foreign currency exchange operations in respect
of such Eligible Currency or Alternate Currency, respectively, are then being
conducted) for such Eligible Currency or Alternate Currency, respectively, at
or about 1:00 p.m. local time, on such date for the purchase of Dollars with
such Eligible Currency or Alternate Currency for delivery two (2) Business Days
later; provided, however, that if at the time of any such determination, for
any reason, no such spot rate is being quoted, the Administrative Agent or
Alternate Currency Lender, as applicable, may use any reasonable method it
deems appropriate to determine such rate, and such determination shall be
conclusive absent manifest error.
"Existing Letters of Credit" means the letters of credit issued prior to
the Original Closing Date by Bank One, Indiana, N.A. for the account of one or
more of the Borrowers and listed on Schedule 1.1.1 and the letters of credit
issued prior to the Closing Date pursuant to the Original Credit Agreement and
listed on Schedule 1.1.1.
"Facility Letter(s) of Credit" means (i) the Existing Letters of Credit
and (ii) the letters of credit to be issued by one of the Issuing Lenders
pursuant to Section 2.20 hereof.
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"Federal Funds Effective Rate" is defined in the definition of Alternate
Base Rate above.
"Fees" is defined in Section 6.4(A) hereof.
"Fixed Charge Coverage Ratio" is defined in Section 6.4(C) hereof.
"Fixed Rate Loans" means any Loan which bears interest at a fixed interest
rate for the applicable Interest Period determined by reference to the
Eurocurrency Rate or, for Alternate Currency Loans, by reference to the
applicable fixed rate of interest agreed to between the Alternate Currency
Lender and the applicable Subsidiary Borrower.
"Floating Rate Loans" means any Loan which bears interest at a fluctuating
interest rate determined by reference to the Alternate Base Rate or, for
Alternate Currency Loans, by reference to the applicable floating rate of
interest agreed to between the Alternate Currency Lender and the applicable
Subsidiary Borrower.
"Foreign Employee Benefit Plan" means any employee benefit plan as defined
in Section 3(3) of ERISA which is maintained or contributed to for the benefit
of the employees of Brightpoint, any of its Subsidiaries or any members of its
Controlled Group and is not covered by ERISA pursuant to ERISA Section 4(b)(4).
"Foreign Pension Plan" means any employee benefit plan as described in
Section 3(3) of ERISA which (i) is maintained or contributed to for the benefit
of employees of Brightpoint, any of its Subsidiaries or any of its ERISA
Affiliates, (ii) is not covered by ERISA pursuant to Section 4(b)(4) of ERISA,
and (iii) under applicable local law, is required to be funded through a trust
or other funding vehicle.
"French Francs" or "FF" means the lawful money of the Republic of France.
"Governmental Acts" is defined in Section 2.25(a) hereof.
"Governmental Authority" means any nation or government, any federal,
state, local or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Gross Negligence" means recklessness, the absence of the slightest care or
the complete disregard of consequences. Gross Negligence does not mean the
absence of ordinary care or diligence, or an inadvertent act or inadvertent
failure to act. If the term "gross negligence" is used with respect to any
Agent, the Arranger or any Lender or any Indemnitee in any of the other Loan
Documents, it shall have the meaning set forth herein.
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"Guarantor Assumption Letter" means a letter of a Domestic Subsidiary of
Brightpoint addressed to the Lenders substantially in the form of Exhibit C
hereto pursuant to which such Domestic Subsidiary agrees to become a "Guarantor"
and agrees to be bound by the terms hereof.
"Guarantors" shall mean (a) with respect to all of the Secured Obligations,
Brightpoint, BPI and each Domestic Subsidiary of Brightpoint which becomes a
Guarantor pursuant to the terms of Section 6.2(M) and (b) with respect to the
Secured Obligations made to the Subsidiary Borrowers, each such Subsidiary
Borrower.
"Hedging Agreements" is defined in Section 6.3(Q).
"Hedging Obligations" of a Person means any and all obligations of such
Person, whether absolute or contingent and howsoever and whensoever created,
arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all
agreements, devices or arrangements designed to protect at least one of the
parties thereto from the fluctuations of interest rates, exchange rates or
forward rates applicable to such party's assets, liabilities or exchange
transactions, including, but not limited to, dollar-denominated or
cross-currency interest rate exchange agreements, forward currency exchange
agreements, interest rate cap or collar protection agreements, forward rate
currency or interest rate options, puts and warrants, and (ii) any and all
cancellations, buy backs, reversals, terminations or assignments of any of the
foregoing.
"Holders of Secured Obligations" means the holders of the Secured
Obligations from time to time and shall refer to (i) each Lender in respect of
its Loans (including, if applicable, any agency or Affiliate of the Alternate
Currency Lender utilized for making Alternate Currency Loans), (ii) each of the
Issuing Lenders and the Alternate Currency Lender in respect of Reimbursement
Obligations and other Obligations relating to its Facility Letters of Credit
(including, if applicable, any agency or Affiliate of the Alternate Currency
Lender utilized for issuing any Alternate Currency Letters of Credit), (iii) the
Agents, the Arranger, the Swing Line Lender and the Issuing Lenders in respect
of all other present and future obligations and liabilities of any Borrower or
any of their subsidiaries of every type and description arising under or in
connection with this Agreement or any other Loan Document, (iv) each Indemnitee
in respect of the obligations and liabilities of any Borrower to such Person
hereunder or under any of the Loan Documents, (v) each Lender (or any agency or
Affiliate thereof) in respect of all Hedging Obligations of any Borrower or any
of their Subsidiaries to such lender (or agency or Affiliate thereof) and (vi)
their respective successors, transferees and assigns.
"Hong Kong Dollars" or "HK$" means the lawful money of Hong Kong.
"Indebtedness" of any Person means (i) any indebtedness of such Person,
contingent or otherwise, (a) in respect of borrowed money including all
principal, interest, fees and expenses
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<PAGE> 29
with respect thereto (whether or not the recourse of the lender is to the whole
of the assets of such Person or only to a portion thereof), or (b) evidenced by
bonds, notes, acceptances, debentures or other instruments or letters of credit
(or reimbursement obligations with respect thereto, including, in the case of
the Borrowers, Reimbursement Obligations under the Letters of Credit) or
representing the balance deferred and unpaid of the purchase price of any
property (including pursuant to Capitalized Leases) or services, if and to the
extent any of the foregoing indebtedness would appear as a liability upon a
balance sheet of such Person prepared in accordance with Agreement Accounting
Principles (except that any such balance that constitutes a trade payable and/or
an accrued liability arising in the ordinary course of business shall not be
considered Indebtedness and except that accounts payable in an amount not to
exceed in the aggregate $250,000 of the nature described above shall also not be
considered Indebtedness); (ii) to the extent not otherwise included,
(a) interest accruing after the commencement of any bankruptcy, insolvency,
receivership or similar proceedings and other interest that would have accrued
but for the commencement of such proceedings, (b) any Capitalized Lease
Obligations, (c) obligations, whether or not assumed, secured by Liens or
payable out of the proceeds or production from property now or hereafter owned
or acquired by such Person, and (d) Contingent Obligations (exclusive of whether
such items would appear upon such balance sheet). The amount of Indebtedness of
any Person at any date shall be without duplication (i) the outstanding balance
at such date of all unconditional obligations as described above and the maximum
liability of any such Contingent Obligations at such date and (ii) in the case
of Indebtedness of others secured by a Lien to which the property or assets
owned or held by such Person is subject, the lesser of the fair market value at
such date of any asset subject to a Lien securing the Indebtedness of others and
the amount of the Indebtedness secured. Notwithstanding anything herein to the
contrary, if any Contingent Obligations of Brightpoint or any of its
Subsidiaries related to liabilities of any other of Brightpoint and its
Subsidiaries (the "Originator") and such liabilities would not be considered
Indebtedness of such Originator, then the Contingent Obligation of the other
Person with respect to such liabilities shall also not be considered
Indebtedness.
"Indemnified Matters" is defined in Section 10.7(B) hereof.
"Indemnitees" is defined in Section 10.7(B) hereof.
"Indenture" means that certain Indenture dated as of March 11, 1998 by and
between Brightpoint and Chase Manhattan Bank, as trustee, pursuant to which the
LYONS were issued, as amended, supplemented or modified in accordance with
Section 6.3(R) hereof.
"Intercompany Loans" is defined in Section 6.3(A)(c).
"Interest Expense" is defined in Section 6.4(A) hereof.
"Interest Expense Coverage Ratio" is defined in Section 6.4(B) hereof.
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"Interest Period" means, with respect to a Eurocurrency Rate Loan, a
period of one (1), two (2), three (3) or six (6) months commencing on a
Business Day selected by the applicable Borrower pursuant to this Agreement.
Such Interest Period shall end on (but exclude) the day which corresponds
numerically to such date one, two, three or six months thereafter; provided,
however, that if there is no such numerically corresponding day in such next,
second, third or sixth succeeding month, such Interest Period shall end on the
last Business Day of such next, second, third or sixth succeeding month. If an
Interest Period would otherwise end on a day which is not a Business Day, such
Interest Period shall end on the next succeeding Business Day, provided,
however, that if said next succeeding Business Day falls in a new calendar
month, such Interest Period shall end on the immediately preceding Business
Day.
"Inventory" means any and all goods, including, without limitation, goods
in transit, wheresoever located, whether now owned or hereafter acquired by
Brightpoint or BPI which are held for sale or lease, furnished under any
contract of service or held as raw materials, work in process or supplies, and
all materials used or consumed in the business of Brightpoint or BPI, and shall
include such property the sale or other disposition of which has given rise to
Receivables and which has been returned to or repossessed or stopped in transit
by Brightpoint or BPI. Notwithstanding anything herein to the contrary,
"Inventory" shall not include any goods which are consigned to Brightpoint or
BPI by any third party.
"Investment" means, with respect to any Person, (i) any purchase or other
acquisition by that Person of any Equity Interest, notes, debentures or other
securities, or of a beneficial interest in any Equity Interest, notes,
debentures or other securities, issued by any other Person, (ii) any purchase
by that Person of all or substantially all of the assets of a business
conducted by another Person, and (iii) any loan, advance (other than deposits
with financial institutions available for withdrawal on demand, prepaid
expenses, accounts receivable, advances to employees and similar items in each
case made or incurred in the ordinary course of business) or capital
contribution by that Person to any other Person, including all Indebtedness to
such Person arising from a sale of property by such Person other than in the
ordinary course of its business.
"IRS" means the Internal Revenue Service and any Person succeeding to the
functions thereof.
"Issuing Lender" means, as the context may require, (i) NBD with respect
to Facility Letters of Credit issued by it pursuant to this Agreement, (ii)
Bank One, Indiana, National Association, with respect to the Existing Letters
of Credit and with respect to Facility Letters of Credit issued by it pursuant
to this Agreement, (iii) any other Lender that becomes an Issuing Lender,
pursuant to Section 2.20, with respect to Facility Letters of Credit issued by
such Lender, (iv) the Alternate Currency Lender with respect to the issuance of
Alternate Currency Letters of Credit or (v) collectively, all the foregoing.
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"Italian Lire" means the lawful money of Italy.
"Japanese Yen" means the lawful money of Japan.
"L/C Draft" means a draft drawn on an Issuing Lender pursuant to a Facility
Letter of Credit.
"L/C Interest" is defined in Section 2.21.
"L/C Obligations" means, without duplication, an amount equal to the sum of
(i) the aggregate of the amount then available for drawing under each of the
Facility Letters of Credit, (ii) the face amount of all outstanding L/C Drafts
corresponding to the Facility Letters of Credit, which L/C Drafts have been
accepted by the Issuing Lender, (iii) the aggregate outstanding amount of all
Reimbursement Obligations with respect to the Facility Letters of Credit at such
time and (iv) the aggregate face amount of all Facility Letters of Credit
requested by any Borrower but not yet issued (unless the request for an unissued
Facility Letter of Credit has been denied).
"Lenders" means the lending institutions listed on the signature pages of
this Agreement, including the Issuing Lenders, the Alternate Currency Lender and
the Swing Line Lender and their respective successors and assigns. Each
reference in this Agreement to any Lender shall, to the extent applicable, be
deemed to be a reference to the Alternate Currency Lender.
"Lending Installation" means, with respect to a Lender or the
Administrative Agent, any office, branch, Subsidiary or affiliate of such Lender
or the Administrative Agent.
"Letter(s) of Credit" means (i) the Facility Letters of Credit and (ii) the
Alternate Currency Letters of Credit.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or security agreement or preferential arrangement of any kind or nature
whatsoever (including, without limitation, the interest of a vendor or lessor
under any conditional sale, Capitalized Lease or other title retention
agreement).
"Loan(s)" means, (i) with respect to a Lender, such Lender's portion of any
Advance made pursuant to Section 2.1, (ii) with respect to the Swing Line
Lender, its Swing Line Loans, (iii) with respect to the Alternate Currency
Lender, its Alternate Currency Loans, and (iv) collectively all Loans, whether
Revolving Loans, Alternate Currency Loans or Swing Line Loans and whether made
or continued as or converted to Floating Rate Loans or Fixed Rate Loans.
"Loan Account" is defined in Section 2.14(F) hereof.
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"Loan Documents" means this Agreement, the Alternate Currency Documents,
the Notes, the Collateral Documents and all other documents, instruments and
agreements executed in connection therewith or contemplated thereby, including
the letter agreements regarding fees among the Administrative Agent, the
Arranger, the Syndication Agent and Brightpoint and between the Administrative
Agent and the Borrower, in each case as the same may be amended, restated or
otherwise modified and in effect from time to time.
"LYONS"(TM) means those certain Liquid Yield Option(TM) Notes due 2018
(Zero Coupon -- Subordinated), issued by Brightpoint pursuant to the Indenture,
as the same may be amended, supplemented or modified in accordance with Section
6.3(R) hereof.
"Management" means those Persons listed on Schedule 1.1.5 under such
heading.
"Margin Stock" shall have the meaning ascribed to such term in Regulation
U.
"Material Adverse Effect" means a material adverse effect upon (a) the
business, condition (financial or otherwise), operations, performance,
properties or prospects of Brightpoint and its Subsidiaries taken as a whole,
(b) the ability of any Borrower to perform its respective obligations under the
Loan Documents in any material respect, or (c) the ability of the Lenders or
the Administrative Agent to enforce in any material respect the Obligations or
their rights with respect to the Collateral other than any such inability
resulting form the Gross Negligence or willful misconduct of any Lender or any
Agent.
"Material Subsidiary" shall mean a direct or indirect Subsidiary of
Brightpoint the consolidated total assets (directly and together with its
Subsidiaries) of which are, at any time, greater than $3,000,000; provided that
Brightpoint JBA, L.L.C. shall not be considered a "Material Subsidiary"
hereunder so long as such Subsidiary engages in no other activity other than
owning, directly or indirectly, an interest in a jet engine aircraft.
"Maximum Eurocurrency Amount" means One-Hundred Twenty-Five Million and
00/100 Dollars ($125,000,000).
"Maximum Aggregate Alternate Currency Amount" means Twenty-Five Million
and 00/100 Dollars ($25,000,000).
"Multiemployer Plan" means a "Multiemployer Plan" as defined in Section
4001(a)(3) of ERISA which is, or within the immediately preceding six (6) years
was, contributed to by either Brightpoint or any member of the Controlled
Group.
"National Currency Unit" means the unit of currency (other than a Euro
unit) of each member state of the European Union that participates in the third
stage of Economic and Monetary Union.
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"NBD" means NBD Bank, N.A., in its individual capacity.
"Net Income" is defined in Section 6.4(A) hereof.
"Non Pro Rata Loan" is defined in Section 8.2 hereof.
"Notes" means the Revolving Notes, any notes issued to evidence the
Alternate Currency Loans, and the Swing Line Loan Note.
"Notice of Assignment" is defined in Section 13.3(B) hereof.
"Obligations" means all Loans, Alternate Currency Loans, reimbursement
obligations with respect to Facility Letters of Credit and Alternate Currency
Letters of Credit, advances, debts, liabilities, obligations, covenants and
duties owing by any of the Borrowers, Subsidiary Borrowers or Guarantors to the
Administrative Agent, the Arranger, the Syndication Agent, any of the Lenders,
the Alternate Currency Lender, the Issuing Lenders, the Swing Line Lender, any
Affiliate of any of the foregoing or any Indemnitee, of any kind or nature,
present or future, arising under this Agreement, the Notes, the Collateral
Documents, any other Loan Document, whether or not evidenced by any note,
guaranty or other instrument, whether or not for the payment of money, whether
arising by reason of an extension of credit, loan, guaranty, indemnification, or
in any other manner, whether direct or indirect (including those acquired by
assignment), absolute or contingent, due or to become due, now existing or
hereafter arising and however acquired. The term includes, without limitation,
all interest, charges, expenses, fees, attorneys' fees and disbursements,
paralegals' fees (in each case whether or not allowed), and any other sum
chargeable to any of the Borrowers or Guarantors under this Agreement or any
other Loan Document.
"Original Administrative Agent" means The First National Bank of
Chicago, in its capacity as the "Administrative Agent" under the Original Credit
Agreement.
"Original Closing Date" means June 24, 1997.
"Original Credit Agreement" means the Multicurrency Credit Agreement dated
as of June 24, 1997 among Brightpoint, BPI, certain subsidiaries of Brightpoint,
and the Agents, as the same was amended by a letter agreement dated August 8,
1997, Amendment and Waiver No. 1 thereto dated as of November 15, 1997, Consent
Memorandum dated as of March 13, 1998, Amendment No. 2 dated as of February 25,
1998, Amendment No. 3 dated as of March 20, 1998, and Consent Memorandum dated
as of March 26, 1998.
"Other Taxes" is defined in Section 2.14(E)(ii) hereof.
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"Participants" is defined in Section 13.2(A) hereof.
"Payment Date" means the last Business Day of each March, June, September
and December.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Permitted Acquisition" is defined in Section 6.3(G) hereof.
"Permitted Existing Contingent Obligations" means the Contingent
Obligations of the Borrowers and all other Subsidiaries of Brightpoint
identified as such on Schedule 1.1.2 to this Agreement.
"Permitted Existing Indebtedness" means the Indebtedness of the Borrowers
and all other Subsidiaries of Brightpoint identified as such on Schedule 1.1.3
to this Agreement.
"Permitted Existing Investments" means the Investments of the Borrowers and
all other Subsidiaries of Brightpoint identified as such on Schedule 1.1.4 to
this Agreement.
"Permitted Existing Liens" means the Liens on assets of the Borrowers or
all other Subsidiaries of Brightpoint identified as such on Schedule 1.1.5 to
this Agreement.
"Permitted Purchase Money Indebtedness" is defined in Section 6.3(A)
hereof.
"Permitted Subordinated Indebtedness" means the Indebtedness evidenced by
the LYONS.
"Person" means any natural person, corporation, firm, company, joint
venture, partnership, association, enterprise, trust or other entity or
organization, or any government or political subdivision or any agency,
department or instrumentality thereof.
"Plan" means an employee benefit plan defined in Section 3(3) of ERISA in
respect of which Brightpoint or any member of the Controlled Group is, or within
the immediately preceding six (6) years was, an "employer" as defined in Section
3(5) of ERISA.
"Pledge Agreements" means: (i) that certain Pledge Agreement dated as of
the Original Closing Date executed by Brightpoint in favor of the Administrative
Agent for the benefit of the Holders of Secured Obligations pledging 100% of the
Capital Stock of BPI to secure payment of the Secured Obligations; (ii) that
certain Pledge Agreement dated as of April 17, 1998 executed by Brightpoint in
favor of the Administrative Agent for the benefit of the Holders of Secured
Obligations pledging 100% of the Capital Stock of Brightpoint Latin America
Holdings, Inc., an Indiana corporation, 100% of the Capital Stock of Wireless
Fulfillment Services LLC and the
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Capital Stock of any other "Pledged Subsidiary" set forth therein from time to
time to secure payment of the Secured Obligations; (iii) that certain Pledge of
Shares dated April 17, 1998 executed by BPI in favor of the Administrative Agent
for the benefit of the Holders of Secured Obligations pledging 65% of the
Capital Stock of Brightpoint BV1 to secure payment of the Secured Obligations;
(iv) that certain Pledge of Shares dated April 17, 1998 executed by Brightpoint
BV1 in favor of the Agent for the benefit of the Holders of Secured Obligations
pledging 65% of the Capital Stock of Brightpoint BV2 to secure payment of the
Secured Obligations; and (v) any other pledge agreements subsequently executed
by Brightpoint or any of its Subsidiaries to secure the Secured Obligations,
together in each case with all documents, instruments and agreements executed in
connection therewith or contemplated thereby.
"Prime Rate" is defined in the definition of Alternate Base Rate above.
"Pro Rata Share" means, with respect to any Lender, the percentage obtained
by dividing (A) such Lender's Revolving Loan Commitment, or, with respect to the
Alternate Currency Lender, its Alternate Currency Commitment, at such time (as
adjusted from time to time in accordance with the provisions of this Agreement)
by (B) the Aggregate Commitment of the Lenders at such time; provided, however,
if all of the Commitments are terminated pursuant to the terms of this
Agreement, then "Pro Rata Share" means the percentage obtained by dividing (x)
the sum of all of such Lender's Loans and L/C Obligations by (y) the aggregate
amount of all Loans and L/C Obligations.
"Purchasers" is defined in Section 13.3(A) hereof.
"Rate Option" means the applicable Fixed Rate or Floating Rate.
"RC Buying Lender" is defined in Section 2.4(f).
"RC Selling Lender" is defined in Section 2.4(f).
"Reallocated Share" is defined in Section 2.4(f).
"Receivable(s)" means and includes all of Brightpoint's or BPI's presently
existing and hereafter arising or acquired accounts, accounts receivable, and
all present and future rights of Brightpoint or BPI to payment for goods sold or
leased or for services rendered (except those evidenced by instruments or
chattel paper), whether or not they have been earned by performance, including,
without limitation, accounts receivable generated by virtue of Contract Finance
Receivables, and all rights in any merchandise or goods which any of the same
may represent, and all rights, title, security and guaranties with respect to
each of the foregoing, including, without limitation, any right of stoppage in
transit.
"Register" is defined in Section 13.3(C) hereof.
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"Regulation G" means Regulation G of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by nonbank, nonbroker lenders for the purpose of purchasing
or carrying margin stock (as defined therein).
"Regulation T" means Regulation T of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by and to brokers and dealers of securities for the purpose
of purchasing or carrying margin stock (as defined therein).
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying Margin
Stock applicable to member banks of the Federal Reserve System.
"Regulation X" means Regulation X of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by foreign lenders for the purpose of purchasing or carrying
margin stock (as defined therein).
"Reimbursement Obligation" is defined in Section 2.22 hereof.
"Release" means any release, spill, emission, leaking, pumping, injection,
deposit, disposal, discharge, dispersal, leaching or migration into the indoor
or outdoor environment, including the movement of Contaminants through or in the
air, soil, surface water or groundwater.
"Rentals" is defined in Section 6.4(A) hereof.
"Replacement Lender" is defined in Section 2.19 hereof.
"Reportable Event" means a reportable event as defined in Section 4043 of
ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within 30 days after
such event occurs; provided, however, that a failure to meet the minimum funding
standards of Section 412 of the Code and of Section 302 of ERISA shall be a
Reportable Event regardless of the issuance of any such waiver of the notice
requirement in accordance with either Section 4043(a) of ERISA or Section 412(d)
of the Code.
"Required Lenders" means Lenders whose Pro Rata Shares, in the aggregate,
are at least sixty-six and two-thirds percent (66-2/3%), provided, however,
that, if any of the Lenders shall
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<PAGE> 37
have failed to fund its Revolving Credit Share of any Loan requested by any
Borrower which such Lenders are obligated to fund under the terms of this
Agreement and any such failure has not been cured, then for so long as such
failure continues, "Required Lenders" means Lenders (excluding all Lenders
whose failure to fund such Loans have not been so cured) whose Pro Rata Shares
represent at least sixty-six and two-thirds percent (66-2/3%) of the aggregate
Pro Rata Shares of such non-defaulting Lenders; provided, further, however,
that, if the Commitments have been terminated pursuant to the terms of this
Agreement, "Required Lenders" means Lenders (without regard to such Lenders'
performance of their respective obligations hereunder) whose aggregate ratable
shares (stated as a percentage) of the aggregate outstanding principal balance
of all Loans and L/C Obligations are at least sixty-six and two-thirds percent
(66-2/3%).
"Requirements of Law" means, as to any Person, the charter and by-laws or
other organizational or governing documents of such Person, and any law, rule
or regulation, or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is
subject including, without limitation, the Securities Act, the Securities
Exchange Act, Regulations G, T, U and X, ERISA, the Fair Labor Standards Act,
the Worker Adjustment and Retraining Notification Act, Americans with
Disabilities Act of 1990, and any certificate of occupancy, zoning ordinance,
building, environmental or land use requirement or Permit or environmental,
labor, employment, occupational safety or health law, rule or regulation,
including Environmental, Health or Safety Requirements of Law.
"Reserve Requirement" means the maximum reserve requirement, as prescribed
by the Board of Governors of the Federal Reserve System (or any successor) with
respect to "Eurocurrency liabilities" or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
Eurocurrency Rate Loans is determined or category of extensions of credit or
other assets which includes loans by a non-United States office of any Lender
to United States residents.
"Reset Date" is defined in Section 1.3.
"Restricted Junior Payment" means (i) any dividend or other distribution,
direct or indirect, on account of any ownership, membership or other Equity
Interest in Brightpoint now or hereafter outstanding, except a dividend payable
solely in additional interests of the same type, (ii) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any ownership, membership or other Equity
Interest in Brightpoint or any such interests or shares of any class of Capital
Stock of Brightpoint now or hereafter outstanding, (iii) any payment or
prepayment of principal of, premium, if any, or interest, fees or other charges
on or with respect to, and any redemption, purchase, retirement, defeasance,
sinking fund or similar payment and any claim for rescission with respect to
any Permitted Subordinated Indebtedness, (iv) any payment made to redeem,
purchase, repurchase or retire, or to obtain the surrender of, any outstanding
options or other rights to acquire any
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ownership, membership or other Equity Interests in Brightpoint, (v) any payment
of a claim for the rescission of the purchase or sale of, or for material
damages arising from the purchase or sale of any Permitted Subordinated
Indebtedness or any ownership, membership or other Equity Interests in
Brightpoint or of a claim for reimbursement, indemnification or contribution
arising out of or related to any such claim for damages or rescission and (vi)
any payment of management fees (or other fees of a similar nature) by
Brightpoint to any holder of ownership, membership or other Equity Interests in
Brightpoint or any member of management of Brightpoint or their Affiliates.
"Revolving Credit Availability" means, at any particular time, the amount
by which the Aggregate Revolving Loan Commitment at such time exceeds the Dollar
Amount of the Revolving Credit Obligations at such time.
"Revolving Credit Obligations" means, at any particular time, the sum of
(i) the outstanding principal amount of the Revolving Loans at such time, plus
(ii) the L/C Obligations at such time plus (iii) the outstanding principal
amount of the Swing Line Loans at such time.
"Revolving Credit Share" means, with respect to any Lender, the percentage
obtained by dividing (A) such Revolving Lender's Revolving Loan Commitment at
such time by (B) the Aggregate Revolving Loan Commitment at such time.
"Revolving Loan" is defined in Section 2.1.
"Revolving Loan Commitment" means, for each Lender, the obligation of such
Lender to make Revolving Loans and to purchase participations in Facility
Letters of Credit Swing Line Loans and Alternate Currency Credits under Section
2.4 not exceeding the Dollar Amount set forth on Exhibit D to this Agreement
opposite its name thereon under the heading "Revolving Loan Commitment" or in
the assignment and acceptance by which it became a Lender, as such amount may be
modified from time to time pursuant to the terms of this Agreement or to give
effect to any applicable assignment and acceptance.
"Revolving Note" means (a) the master promissory note, in substantially the
form of Exhibit E hereto, duly executed by a Borrower and issued to the
Administrative Agent on behalf of all of the Lenders which have made or
purchased Revolving Loans in the amount of the Aggregate Revolving Loan
Commitment, including any amendment, restatement, modification, renewal or
replacement of such Revolving Note and (b) any individual promissory note issued
by each of Brightpoint and BPI to any Lender requesting such individual
promissory note and in substantially the form of Exhibit F hereto, duly executed
by a Borrower and payable to the order of a Lender in the amount of its
Revolving Loan Commitment (or, if to the Alternate Currency Lender in respect of
a purchase thereby of any Revolving Credit Obligations pursuant to Section 2.4,
in the aggregate amount of the Revolving Credit Obligations so purchased,
including any amendment, restatement, modification, renewal or replacement of
such Revolving Note.
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"Risk-Based Capital Guidelines" is defined in Section 3.2 hereof.
"Secured Obligations" means, collectively, (i) the Obligations and (ii) all
Hedging Obligations owing to one or more of the Lenders (or any agency or
Affiliate thereof).
"Security Agreements" means (a) those certain Security Agreements dated as
of the Original Closing Date executed by Brightpoint and BPI, respectively, in
favor of the Administrative Agent for the benefit of the Holders of Secured
Obligations as amended, restated or otherwise modified from time to time and (b)
those security agreements, in substantially the same form as the Security
Agreement executed by Brightpoint, executed by any Material Subsidiary which is
a Domestic Subsidiary pursuant to the terms of Section 6.2(M).
"Single Employer Plan" means a Plan maintained by Brightpoint or any member
of the Controlled Group for employees of Brightpoint or any member of the
Controlled Group.
"Sterling" means the lawful money of the United Kingdom.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding Capital Stock having ordinary voting power of which shall at the
time be owned or controlled, directly or indirectly, by such Person or by one or
more of its Subsidiaries or by such Person and one or more of its Subsidiaries,
or (ii) any company, partnership, association, joint venture or similar business
organization more than 50% of the ownership interests having ordinary voting
power of which shall at the time be so owned or controlled. Unless otherwise
expressly provided, all references herein to a "Subsidiary" shall mean a direct
or indirect Subsidiary of Brightpoint.
"Subsidiary Borrower" means each direct or indirect Subsidiary of
Brightpoint named as such on the signature pages of an Alternate Currency
Addendum and duly designated by Brightpoint pursuant to Section 2.3(f) hereof to
request Alternate Currency Loans or Alternate Currency Letters of Credit;
provided no Subsidiary may be a Subsidiary Borrower if less than 80% of the
combined voting power of such Subsidiary's Capital Stock ordinarily having the
right to vote at an election of directors of such Subsidiary is owned of record
and beneficially directly or indirectly by Brightpoint, Brightpoint shall have
the power, directly or indirectly to elect a majority of the board of directors
of such Subsidiary and such Subsidiary shall have delivered such documents,
instruments and agreements as may be required pursuant to the terms of this
Agreement.
"Swedish Kroner" means the lawful money of Sweden.
"Swing Line Lender" means NBD and any replacement Administrative Agent that
elects to be a Swing Line Lender.
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"Swing Line Loan" means (a) any Swing Line Loan made pursuant to the
Original Credit Agreement and outstanding on the Closing Date and (b) a loan
made available to either of the Borrowers by the Swing Line Lender pursuant to
Section 2.2.
"Swing Line Loan Commitment" means the obligation of the Swing Line Lender
to make Swing Line Loans up to a maximum principal amount of $5,000,000 at any
one time outstanding.
"Swing Line Loan Note" means a the Swing Line Loan Note in substantially
the form of Exhibit F hereto executed by Brightpoint as of the Original Closing
Date and payable to the order of the Swing Line Lender in the amount, if any,
of its Swing Line Loan Commitment.
"Swiss Francs" means the lawful money of Switzerland.
"Syndication Agent" means Bank One, Indiana, National Association, in its
capacity as Syndication Agent with respect to this Agreement.
"Taxes" is defined in Section 2.14(E)(i) hereof.
"Termination Date" means the earlier of (a) June 23, 2002 or (b) the date
of termination of the Commitments pursuant to Section 2.6 or Section 8.1.
"Termination Event" means (i) a Reportable Event with respect to any
Benefit Plan; (ii) the withdrawal of Brightpoint or any member of the
Controlled Group from a Benefit Plan during a plan year in which Brightpoint or
such Controlled Group member was a "substantial employer" as defined in Section
4001(a)(2) of ERISA or the cessation of operations which results in the
termination of employment of twenty percent (20%) of Benefit Plan participants
who are employees of Brightpoint or any member of the Controlled Group; (iii)
the imposition of an obligation on Brightpoint or any member of the Controlled
Group under Section 4041 of ERISA to provide affected parties written notice of
intent to terminate a Benefit Plan in a distress termination described in
Section 4041(c) of ERISA; (iv) the institution by the PBGC of proceedings to
terminate a Benefit Plan; (v) any event or condition which might constitute
grounds under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Benefit Plan; or (vi) the partial or complete
withdrawal of Brightpoint or any member of the Controlled Group from a
Multiemployer Plan.
"Total Capital" means, at a particular date, the sum of (a) Consolidated
Book Equity on such date plus (b) the aggregate outstanding principal balance
of the LYONS on such date. Unless otherwise specified herein, Total Capital
shall be determined based upon the financial statements most recently delivered
pursuant to the terms of Section 6.1(A).
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"Trademark Security Agreement" means that certain Trademark Security
Agreement dated as of the Original Closing Date executed by Brightpoint in favor
of the Administrative Agent for the benefit of the Holders of Secured
Obligations as amended, restated or otherwise modified from time to time.
"Transferee" is defined in Section 13.5 hereof.
"Type" means, with respect to any Loan, its nature as a Base Rate Loan or a
Eurocurrency Rate Loan.
"Unmatured Default" means an event which, but for the lapse of time or the
giving of notice, or both, would constitute a Default.
"Year 2000 Issues" means the anticipated costs, problems and uncertainties
associated with the inability of certain computer applications to effectively
handle data including dates on and after January 1, 2000, as it affects the
business, operations, and financial condition of the Borrower, or the Borrower
and its Subsidiaries and of the Borrower's and its Subsidiaries' customers,
suppliers and vendors.
The foregoing definitions shall be equally applicable to both the singular
and plural forms of the defined terms. Any accounting terms used in this
Agreement which are not specifically defined herein shall have the meanings
customarily given them in accordance with United States generally accepted
accounting principles in existence as of the date hereof.
1.2 Supplemental Disclosure. At any time at the request of the
Administrative Agent and at such additional times as Brightpoint determines,
Brightpoint shall supplement each schedule or representation herein or in the
other Loan Documents with respect to any matter hereafter arising which, if
existing or occurring at the date of this Agreement, would have been required to
be set forth or described in such schedule or as an exception to such
representation or which is necessary to correct any information in such schedule
or representation which has been rendered inaccurate thereby. If any such
supplement to such schedule or representation discloses the existence or
occurrence of events, facts or circumstances which are restricted or prohibited
by the terms of this Agreement or any other Loan Documents, such supplement to
such schedule or representation shall not be deemed an amendment thereof unless
expressly consented to in writing by Administrative Agent and the Required
Lenders, and no such amendments, except as the same may be consented to in a
writing which expressly includes a waiver, shall be or be deemed a waiver by the
Administrative Agent or any Lender of any Default disclosed therein. Any items
disclosed in any such supplemental disclosures shall be included in the
calculation of any limits, baskets or similar restrictions contained in this
Agreement or any of the other Loan Documents.
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1.3 Currency Equivalents. Not later than 12:00 noon, Indianapolis time or
local time, as applicable, on each Calculation Date, the Administrative Agent
and the Alternate Currency Lender, as applicable, shall (i) determine the
Exchange Rate as of such Calculation Date with respect to each Agreed Currency
and each Alternate Currency as to which an Alternate Currency Addendum is in
effect and (ii) give notice thereof to Brightpoint and the Lenders. The
Exchange Rates so determined shall become effective immediately with respect to
any new Loans being made or Letters of Credit being issued on any Calculation
Date and otherwise on the fifth Business Day immediately following the relevant
Calculation Date (a "Reset Date"), shall remain effective until the next
succeeding Reset Date and shall during the period of their effectiveness be
employed in making any computation of currency equivalents required to be made
under this Agreement (other than any computation required under Section 2.26).
1.4 Amendment and Restatement of Original Credit Agreement. The parties
to this Agreement agree that, upon (i) the execution and delivery by each of
the parties hereto of this Agreement and (ii) satisfaction of the conditions
set forth in Sections 4.1 and 4.2, the terms and provisions of the Original
Credit Agreement shall be and hereby are amended, superseded and restated in
their entirety by the terms and provisions of this Agreement. This Agreement is
not intended to and shall not constitute a novation. All Loans made and Secured
Obligations incurred under the Original Credit Agreement which are outstanding
on the Closing Date shall continue as Loans and Obligations under (and shall be
governed by the terms of) this Agreement. Without limiting the foregoing, (a)
all Existing Letters of Credit (as defined in the Original Credit Agreement)
and the Letters of Credit issued for the account of the Borrowers under the
Original Credit Agreement which remain outstanding on the Effective Date shall
continue as Facility Letters of Credit under (and shall be governed by the
terms of) this Agreement and (b) all Secured Obligations consisting of Hedging
Obligations incurred under Hedging Agreements with any Lender or any Affiliate
of any Lender which are outstanding on the Closing Date shall continue as
Secured Obligations under this Agreement and the other Loan Documents.
By its execution below and subject to the satisfaction of the conditions
set forth in Sections 4.1 and 4.2, the Original Administrative Agent resigns as
the "Administrative Agent" under the Original Credit Agreement. Simultaneously
therewith, and notwithstanding anything in the Original Credit Agreement or
elsewhere to the contrary, NBD shall replace The First National Bank of Chicago
as the Administrative Agent under this Agreement, such replacement shall be
deemed to have occurred in accordance with and in satisfaction of all the
requirements with respect thereto set forth in the Original Credit Agreement
and elsewhere, and consent is hereby expressly given to such replacement.
ARTICLE II: THE CREDITS
2.1 Revolving Loans to Brightpoint and BPI. Upon the satisfaction of
the conditions precedent set forth in Sections 4.1 and 4.2 hereof, from
and including the date of this Agreement
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and prior to the Termination Date, each Lender with a Revolving Loan Commitment
severally and not jointly agrees, on the terms and conditions set forth in this
Agreement, to make revolving loans to Brightpoint and/or BPI from time to time,
in an Agreed Currency, in a Dollar Amount not to exceed such Lender's Revolving
Credit Share of the Dollar Amount of the Revolving Credit Availability at such
time (each individually, a "Revolving Loan" and, collectively, the "Revolving
Loans"); provided, that, if any Advance made (or to be made) on or after the
Euro Implementation Date would, but for this provision, be capable of being made
either in the Euro or in an applicable National Currency Unit, such Advance
shall be made in the Euro; provided, further, however, at no time shall the
Dollar Amount of the Revolving Credit Obligations in Agreed Currencies other
than Dollars exceed the Maximum Eurocurrency Amount other than as a result of
currency fluctuations and then only to the extent permitted in Section 2.5(B).
Each Advance under this Section 2.1 shall consist of Revolving Loans made by
each such Lender ratably in proportion to such Lender's respective Revolving
Credit Share. Subject to the terms of this Agreement, Brightpoint and BPI may
borrow, repay and reborrow at any time prior to the Termination Date. The
Revolving Loans made on the Closing Date shall initially be Base Rate Loans and
thereafter may be continued as Base Rate Loans or converted into Eurocurrency
Rate Loans in the manner provided in Section 2.10 and subject to the other
conditions and limitations therein set forth and set forth in this Article II.
On the Termination Date, the outstanding principal balance of the Revolving
Loans shall be paid in full by the applicable Borrower and prior to the
Termination Date prepayments of the Revolving Loans shall be made if and to the
extent required in Section 2.5.
2.2 Swing Line Loans. (a) Amount of Swing Line Loans. Upon the satisfaction
of the conditions precedent set forth in Sections 4.1 and 4.2, from and
including the date of this Agreement and prior to the Termination Date, the
Swing Line Lender agrees, on the terms and conditions set forth in this
Agreement, to make Swing Line Loans in Dollars to Brightpoint from time to time
in an amount not to exceed the lesser of (i) its Swing Line Loan Commitment
minus the outstanding principal balance of all Swing Line Loans then
outstanding; and (ii) the Revolving Credit Availability at such time. Each Swing
Line Loan shall be in a minimum amount of not less than $100,000 (or such lesser
amount as may be agreed to by the Swing Line Lender) or an integral multiple of
$100,000 (or such lesser amount as may be agreed to by the Swing Line Lender) in
excess thereof, and all interest payable on the Swing Line Loans shall be
payable to the Swing Line Lender for its sole account.
(b) Borrowing Notice. Brightpoint shall deliver to the Administrative Agent
a Borrowing Notice signed by it not later than 12:00 noon. (Indianapolis time)
on the Borrowing Date of each Swing Line Loan specifying (i) the applicable
Borrowing Date (which shall be a Business Day) and (ii) the aggregate amount of
the requested Swing Line Loan. The Swing Line Loans shall at all times be Base
Rate Loans.
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(c) Making of Swing Line Loans. Not later than 3:00 p.m. (Indianapolis
time) on the applicable Borrowing Date, the Swing Line Lender shall make
available its Swing Line Loan in funds immediately available to Brightpoint.
(d) Repayment of Swing Line Loans. The Swing Line Loans shall be evidenced
by a Swing Line Loan Note and each Swing Line Loan shall be paid in full by
Brightpoint on or before the fifth Business Day after the Borrowing Date for
such Swing Line Loan. Outstanding Swing Line Loans may be repaid from the
proceeds of Revolving Loans or Swing Line Loans. Any repayment of a Swing Line
Loan shall be accompanied by accrued interest thereon and shall be in the
minimum amount of $100,000 (or such lesser amount as may be agreed to by the
Swing Line Lender) and in increments of $100,000 (or such lesser amount as may
be agreed to by the Swing Line Lender) in excess thereof or the full amount of
such Swing Line Loan. The Administrative Agent (i) may at any time in its sole
discretion with respect to any outstanding Swing Line Loan, or (ii) shall on the
fifth Business Day after the Borrowing Date of any outstanding Swing Line Loan
(notwithstanding the minimum amount of Base Rate Advances as provided in Section
2.9), require each Lender (including the Swing Line Bank) to make a Revolving
Loan in the amount of such Lender's Revolving Credit Share of such Swing Line
Loan, for the purpose of repaying such Swing Line Loan. Unless the
Administrative Agent shall have been notified in writing by the Required Lenders
prior to its making any Swing Line Loan, that the applicable conditions
precedent set forth in Article IV have not then been satisfied, each Lender's
obligation to make Revolving Loans pursuant to Section 2.1 and this Section
2.2(d), to purchase such loans pursuant to Section 2.4(f) or to repay such Swing
Line Loan shall be unconditional, continuing, irrevocable and absolute and shall
not be affected by any circumstances, including the occurrence or continuance of
a Default. In the event that any Lender fails to make payment to the
Administrative Agent of any amount due under this Section 2.2(d), the
Administrative Agent shall be entitled to receive, retain and apply against such
obligation the principal and interest otherwise payable to such Lender hereunder
until the Administrative Agent receives such payment from such Lender or such
obligation is otherwise fully satisfied. In addition to the foregoing, if for
any reason any Lender fails to make payment to the Administrative Agent of any
amount due under this Section 2.2(d), such Lender shall be deemed, at the option
of the Administrative Agent, to have unconditionally and irrevocably purchased
from the applicable Swing Line Lender, without recourse or warranty, an
undivided interest in and participation in the applicable Swing Line Loan in the
amount of the Loan such Lender was required to make pursuant to this Section
2.2(d) and such interest and participation may be recovered from such Lender
together with interest thereon at the Federal Funds Effective Rate for each day
during the period commencing on the date of demand by the Administrative Agent
and ending on the date such obligation is fully satisfied.
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2.3 Alternate Currency Facility.
(a) General Terms. Brightpoint and the Alternate Currency Lender may,
in their respective discretion, from time to time agree that one or more
Subsidiary Borrowers may borrow (or receive other financial accommodations),
subject to the terms of this Agreement and the applicable Alternate Currency
Documents, Alternate Currency Loans (including having letters of credit issued
for its account) on a revolving basis from the Alternate Currency Lender (or
any Affiliate, branch or agency thereof and designated thereby) by delivering
an Alternate Currency Addendum to the Administrative Agent, executed by such
Subsidiary Borrower and the Alternate Currency Lender.
(b) Alternate Currency Loans/Alternate Currency Letters of Credit;
Procedures. Upon the satisfaction of the conditions precedent set forth in
Sections 4.1, 4.2 and 4.3 hereof and set forth in the applicable Alternate
Currency Documents, from and including the later of the date of this Agreement
and the date of execution of the applicable Alternate Currency Addendum and
prior to the Termination Date (unless an earlier Termination Date shall be
specified in the applicable Alternate Currency Documents), the Alternate
Currency Lender agrees on the terms and conditions set forth in this Agreement
and in the applicable Alternate Currency Documents, to make Alternate Currency
Loans to or to issue one or more Alternate Currency Letters of Credit for the
account of any Subsidiary Borrower identified in an Alternate Currency Addendum
from time to time in the applicable Alternate Currency, such Alternate Currency
Credit in an amount not to exceed the Alternate Currency Commitment minus the
aggregate Dollar Amount of all outstanding Alternate Currency Obligations at
such time. Procedures for making Alternate Currency Credits, with respect to
any Subsidiary Borrower, shall be established pursuant to the Alternate
Currency Documents applicable to such Subsidiary Borrower and the applicable
Alternate Currency. Subject to the terms of this Agreement and the applicable
Alternate Currency Documents, the Subsidiary Borrowers may borrow, repay and
reborrow at any time prior to the Termination Date. On the Termination Date,
the outstanding principal balance of the Alternate Currency Credits shall be
paid in full by the applicable Subsidiary Borrower and prior to the Termination
Date prepayments of the Alternate Currency Credits shall be made by the
applicable Subsidiary Borrower if and to the extent required in Section 2.3(h).
(c) Alternate Currency Addenda. Each Alternate Currency Addendum shall
set forth (i) the true legal identity and notice information with respect to
the applicable Subsidiary Borrower, (ii) the Alternate Currency Lender's local
notice information (or that of its Affiliate, branch or agency which is acting
on behalf of the Alternate Currency Lender), and (iii) the Alternate Currency
applicable thereto, and (iv) the maximum amount (expressed in Dollars and
without duplication) of the Alternate Currency Credit available from the
Alternate Currency Lender with respect to such Alternate Currency Addendum (as
the same may be reduced from time to time pursuant to Section 2.3(j)).
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(d) Limitations on Alternate Currency Loans/Alternate Currency Letters of
Credit. No Alternate Currency Loan may be made and no Alternate Currency Letter
of Credit shall be issued if at the time of the making or issuance thereof (i)
an Exchange Rate with respect to the applicable Alternate Currency cannot be
determined, (ii) with respect to the proposed issuance of an Alternate Currency
Letter of Credit, such Alternate Currency Letter of Credit would, if issued,
expire later than the Termination Date, or (iii) after giving effect thereto,
(A) the Dollar Amount of the Alternate Currency Obligations for such Alternate
Currency would exceed the maximum amount specified as the maximum amount for
such Alternate Currency in the applicable Alternate Currency Addendum or (B) the
Dollar Amount of the Alternate Currency Obligations for all Alternate Currencies
would exceed the Maximum Aggregate Alternate Currency Amount other than as a
result of currency fluctuations and then only to the extent permitted in Section
2.3(h). Additionally, no Alternate Currency Letter of Credit may be issued
unless such Alternate Currency Letter of Credit contains language substantially
similar to the language set forth on Schedule 2.3 regarding a forced-draw of
such Alternate Currency Letter of Credit upon the occurrence of a Conversion
Event with respect to the applicable Subsidiary Borrower and the Alternate
Currency Lender shall be obligated to give notice to the beneficiary of such
Alternate Currency Letter of Credit implementing the forced-draw provision upon
the occurrence of such a Conversion Event.
(e) Reporting by Alternate Currency Lender. The Alternate Currency
Lender shall furnish to the Administrative Agent, not less frequently than
monthly, and at any other time at the reasonable request of the Administrative
Agent, a statement setting forth the outstanding Alternate Currency Credits made
or issued and repaid or expired during the period since the last such report
under such Alternate Currency Addendum.
(f) Subsidiary Borrowers. Brightpoint may at any time or from time to
time, with the consent of the Administrative Agent, which consent shall not be
unreasonably withheld, and of the Alternate Currency Lender, in its discretion,
cause any Subsidiary to be a "Subsidiary Borrower" hereunder by delivery to the
Administrative Agent of (1) a duly completed Alternate Currency Addendum,
executed by such Subsidiary and the Alternate Currency Lender, with the written
consent of Brightpoint at the foot thereof (2) a duly completed Guarantor
Assumption Letter, executed by such Subsidiary, and (3) any other Alternate
Currency Documents or such other instruments or documents as may be reasonably
required by the Administrative Agent. Upon such execution, delivery and consent,
such Subsidiary shall for all purposes be a Subsidiary Borrower under this
Agreement.
(g) Payments; Enforcement. Notwithstanding anything in this Agreement
to the contrary, prior to a Conversion Date, principal, interest and fees
payable on the Alternate Currency Obligations shall be payable to the Alternate
Currency Lender for its own account and at the times (other than prepayments
necessitated by Section 2.3(h) below) and places set forth in the applicable
Alternate Currency Documents.
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(h) Mandatory Prepayments of Alternate Currency Loans. If on any Reset
Date or the date of the making of any Alternate Currency Credit (after giving
effect to any Alternate Currency Credit to be made or issued or repaid or
expired on such date), the Dollar Amount of all Alternate Currency Obligations
under any Alternate Currency Addendum exceeds 105% of the aggregate Alternate
Currency Commitment with respect thereto, the applicable Subsidiary Borrower
shall on such Reset Date or on the date of such borrowing prepay Alternate
Currency Loans, or make a cash collateral deposit to the Alternate Currency
Lender in anticipation of and to be applied against any reimbursement obligation
which may arise in respect of any Alternate Currency Letter of Credit, in an
aggregate amount such that after giving effect thereto the Dollar Amount of all
such Alternate Currency Obligations (less any such cash collateral being held)
is less than or equal to the aggregate Alternate Currency Commitment with
respect thereto.
(i) Termination of Subsidiary Borrowers. So long as the principal of and
interest on any Alternate Currency Loans made to any Subsidiary Borrower shall
have been repaid or paid in full, no outstanding Alternate Currency Letters of
Credit exist with respect to such Subsidiary Borrower, and all other obligations
of such Subsidiary Borrower under any applicable Alternate Currency Documents
and subject shall have been fully performed, Brightpoint may, by notice (subject
to any prior notice requirements under the applicable alternate Currency
documents) to the Alternate Currency Lender and the Administrative Agent (which
shall promptly notify the Lenders thereof), terminate such Subsidiary Borrower's
status as a "Subsidiary Borrower"; provided, however, without the prior approval
of all of the Lenders, no such termination shall operate as a release of a
Pledge Agreement executed by such Subsidiary Borrower, if any, or with respect
to the Capital Stock of such Subsidiary Borrower.
(j) Reduction of Alternate Currency Commitment. Brightpoint may
permanently reduce the Alternate Currency Commitment in whole, or in part, in an
aggregate minimum and integral amounts of $1,000,000 upon at least three (3)
Business Days' written notice to the Alternate Currency Lender and the
Administrative Agent, which notice shall specify the amount of such reduction;
provided, however, that the amount of the Alternate Currency Commitment may not
be reduced below the aggregate principal amount of the outstanding Alternate
Currency Obligations.
2.4. Conversion of Alternate Currency Credits; Risk Sharing by All Lenders
in Alternate Currency Credits.
(a) Conversion Events. For purposes of this Agreement, "Conversion
Event" means the occurrence of any one or more of the following:
(1) with respect to all Alternate Currency Credits, automatically
upon the occurrence of any termination of the Commitments or acceleration
of the Obligations
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pursuant to Section 8.1(a), without any election or action on the part
of the Lenders, the Administrative Agent or the Alternate Currency Lender;
(2) with respect to the Alternate Currency Credits of any particular
Subsidiary Borrower, automatically upon the occurrence of any Default
described in Section 7.1(f), 7.1(g) or 7.1(i) with respect to such
Subsidiary Borrower, without any election or action on the part of the
Administrative Agent, Alternate Currency Lender or any other Lender;
(3) with respect to the Alternate Currency Credits of any particular
Subsidiary Borrower, upon the occurrence of any default under the
applicable Alternate Currency Documents relating to the payment of
principal or interest of the related Alternate Currency Credits;
(4) with respect to all Alternate Currency Credits, upon (a) the
occurrence of any Default and (b) the election by the Required Lenders (any
election under clause (3)(B) or this clause (4) being sometimes referred to
as a "Conversion Election").
(b) Redenomination of Loans in Dollars Upon a Conversion Event.
(1) Immediately upon the occurrence of any Conversion Event under
Section 2.4(a)(1), all Loans denominated in any currency other than Dollars
shall automatically, without any election or action on the part of the
Administrative Agent, the Alternate Currency Lender or any other Lender be
converted to and redenominated in Dollars and shall be deemed to be
"Converted Loans" for purposes of this Section 2.4.
(2) Immediately upon the occurrence of any Conversion Event under
Section 2.4(a)(2), the Alternate Currency Credits of the particular
Subsidiary Borrower affected thereby shall automatically, without any
election or action on the part of the Administrative Agent, the Alternate
Currency Lender or any other Lender be converted to and redenominated in
Dollars and shall be deemed to be "Converted Loans" for purposes of this
Section 2.4.
(3) Upon the occurrence of any Conversion Election under Section
2.4(a)(3), if such election is made by the Alternate Currency Lender for
any particular Alternate Currency Credits, the Alternate Currency Lender
shall advise the Administrative Agent in writing of its election, which
notice shall state that it is a "Conversion Notice" and shall specify the
Subsidiary Borrower the Alternate Currency Credits of which are to be
converted. Promptly upon receipt of such written notice, the
Administrative Agent shall give a Conversion Notice to Brightpoint. On the
date of the receipt by Brightpoint of such Conversion Notice, the
Alternate Currency Loans of such Subsidiary Borrower shall automatically,
without any further election or action in the part of the Administrative
Agent or the Alternate Currency Lender or any other Lender be converted to
and
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redenominated in Dollars and shall be deemed to be "Converted Loans"
for purposes of this Section 2.4.
(4) Upon the occurrence of any Conversion Election under Section
2.4(a)(4), if such election is made by the Required Lenders, the Required
Lenders shall advise the Administrative Agent in writing of their
election, which notice shall state that it is a "Conversion Notice".
Promptly upon receipt of such written notice, the Administrative Agent
shall give a Conversion Notice to Brightpoint and the Alternate Currency
Lender. On the date of the receipt by Brightpoint of such Conversion
Notice, all Loans denominated in any currency other than Dollars shall
automatically, without any further election or action in the part of any
Agent or any Lender be converted to and redenominated in Dollars and shall
be deemed to be "Converted Loans" for purposes of this Section 2.4.
The date of any conversions hereunder shall be referred to as the
"Conversion Date".
(c) Exchange Rate for Conversions. Any Conversion Date (or as soon
thereafter as reasonably practicable if such conversion occurred
automatically and at a time when the Alternate Currency Lender was not
made aware of the circumstances giving rise thereto) shall be a
Calculation Date for any currencies in which Converted Loans were
denominated and the Administrative Agent for Revolving Loans which are
Converted Loans and the Alternate Currency Lender shall (i) determine the
Exchange Rate as of such Calculation Date with respect to each currency in
which Converted Loans were denominated and (ii) give notice thereof to
Brightpoint, the Administrative Agent and the other Lenders. The Exchange
Rate so determined shall be the Exchange Rate applicable with respect to
all Converted Loans initially denominated in such currency.
(d) Payments in Dollars After Conversion; Conversion of Accrued
Interest; Conversion of Alternate Currency Letters of Credit into
Alternate Currency Loans and Termination of Alternate Currency Commitment;
Termination of Obligations to Make Revolving Loans in Currencies Other
than Dollars. Notwithstanding anything in this Agreement or any of the
other Loan Documents to the contrary, from and after any Conversion Date,
all payments with respect to the applicable Converted Loans, whether
principal, interest or otherwise, shall be made by the applicable
Subsidiary Borrower or other Borrowers in Dollars. Accrued and unpaid
interest with respect to any Converted Loan shall, effective on the
Conversion Date applicable thereto, be converted into and redenominated in
Dollars at the Exchange Rate determined pursuant to clause (c) above. Upon
the occurrence of any Conversion Event with respect to the Alternate
Currency Credits to any Subsidiary Borrower, (i) the Alternate Currency
Lender shall implement the forced-draw provision set forth on Schedule 2.3
hereto of any outstanding undrawn Alternate Currency Letter of Credit
issued for the account of such Subsidiary Borrower, and, if the
beneficiary of such Alternate Currency Letter of Credit draws thereon,
then the reimbursement obligation arising out of such draw and owing to
the Alternate Currency Lender
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by the applicable Subsidiary Borrower shall be considered a Converted Loan for
purposes of this Section 2.4, and (ii) the Alternate Currency Commitment to
such Subsidiary Borrower shall be automatically terminated. From and after the
occurrence of any Conversion Event with respect to Revolving Loans, any
Revolving Loans made thereafter shall only be made in Dollars and the Borrowers
shall have no option to select Agreed Currencies for Revolving Loans.
(e) Interest Rates for Converted Loans; Breakage Costs.
Notwithstanding anything in this Agreement or any of the other Loan Documents
to the contrary, the Converted Loans shall initially be Base Rate Loans on the
Conversion Date (and the Borrower shall be liable for all amounts pursuant to
Section 3.4 as a result of the conversion prior to the end of the applicable
Interest Period) and thereafter may be continued as Base Rate Loans or
converted into Eurocurrency Rate Loans denominated in Dollars in the manner
provided in Section 2.10 and subject to the other conditions and limitations
therein set forth and set forth in this Article II.
(f) Reallocation of Shares; Assignment of Loans.
(1) Definitions. For purposes of this Section 2.4(f) the following
terms shall have the following meanings:
"AC Selling Lender" means the Alternate Currency Lender (or any
Affiliate, branch or agency thereof) which made Alternate Currency
Loans which have become Converted Loans and which are being assigned
and sold pursuant to the terms of this Section 2.4(f).
"AC Buying Lender" shall mean each Lender which is required to
purchase any Converted Loan pursuant to the terms of this Section
2.4(f) upon the occurrence of any Conversion Event.
"RC Selling Lender" means each Lender whose Reallocated Share is
a lesser percentage than its Revolving Credit Share immediately prior
to the Conversion Event and whose Revolving Loans and Revolving Loan
Commitment under the Agreement is being reduced as a result of this
Section 2.4(f).
"RC Buying Lender" means each Lender whose Reallocated Share is a
greater percentage than its Revolving Credit Share immediately prior
to the Conversion Event and whose Revolving Loans and Revolving Loan
Commitment under this Agreement is being increased as a result of this
Section 2.4(f).
(2) Required Assignments and Acceptances Upon the Occurrence of any
Conversion Event.
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(I) Effective on any Conversion Date, each of the Lenders agrees to
effect purchases and assignments of all the Converted Loans and the
Revolving Loans (whether or not converted) such that after such purchases
and assignments each Lender has its Pro Rata Share of all Loans and Letters
of Credit other than any Alternate Currency Credits which have not become
Converted Loans.
(II) Effective on any Conversion Date each RC Selling Lender and the
AC Selling Lender (the "Selling Lenders"), hereby sells, grants, assigns
and conveys to each RC Buying Lender and AC Buying Lender (the "Buying
Lenders"), respectively, without recourse, warranty, or representation of
any kind, except as specifically provided herein, an undivided percentage
in such Selling Lender's right, title and interest in and to its
outstanding Revolving Loans, L/C Obligations and Revolving Loan Commitment,
in the case of the RC Selling Lenders and to its Alternate Currency Credits
which are Converted Loans, in the case of the AC Selling Lenders, in the
respective Dollar amounts (except as set forth in clause (IV) below) and
percentages necessary so that, from and after such sale, each such Selling
Lender's and Buying Lender's outstanding Loans, L/C Obligations and
Commitments shall equal its Pro Rata Share of the outstanding Loans, L/C
Obligations and Commitments under this Agreement (other than Alternate
Currency Credits and the Alternate Currency Commitment in connection with
which no Conversion Event has occurred).
(III) Effective on any Conversion Date, each RC Buying Lender and
each AC Buying Lender (the "Buying Lenders") hereby purchases and accepts
such grant, assignment and conveyance from the Selling Lenders. Each Buying
Lender hereby agrees that its respective purchase price for the portion of
the outstanding Loans, Letter of Credit Obligations and Commitment
purchased hereby shall equal the respective Dollar amount (except as set
forth in clause (IV) below) necessary so that, from and after such
payments, each Buying Lender's outstanding Loans, Letter of Credit
Obligations and Commitment shall equal such Buying Lender's Pro Rata Share
of the outstanding Loans, L/C Obligations and Commitments under this
Agreement (other than Alternate Currency Credits and the Alternate Currency
Commitment in connection with which no Conversion Event has occurred).
Except as set forth in clause (IV) below, such amount shall be payable by
the Buying Lenders in Dollars on the applicable Conversion Date by wire
transfer of immediately available funds to the Administrative Agent. The
Administrative Agent, in turn, shall wire transfer any such funds received
to the Selling Lenders, in same day funds, for the sole account of the
Selling Lenders.
(IV) Notwithstanding anything herein to the contrary, if on any
Conversion Date the Revolving Loans in currencies other than are not
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Converted Loans, then the following terms shall apply to the purchase
and sale of such Revolving Loans under this Section 2.4(f):
(a) the purchase price when paid by the RC Buying Lenders for
such sales shall be in the Agreed Currency or Agreed Currencies in
which such Revolving Loans have been made;
(b) the purchase price shall be paid as follows: (i) with respect
to all Floating Rate Loans made by the Selling RC Lenders outstanding
on the Conversion Date, the Buying RC Lenders shall each pay the
Administrative Agent for the account of the Selling RC Lenders, on the
Conversion Date, an amount equal to its purchased percentage of all
such Floating Rate Loans; and (ii) with respect to each Fixed Rate
Loan made by the Selling RC Lenders outstanding on the Conversion
Date, (a) on the last day of the Interest Period therefor or (b) on
the date on which any such Fixed Rate Loan either becomes due (by
acceleration or otherwise) or is prepaid (the date as described in the
foregoing clauses (a) or (b) being hereinafter referred to as the "RC
Payment Date"), each of the RC Buying Lenders shall pay the
Administrative Agent for the account of the RC Selling Lenders an
amount equal to its purchased percentage of such Fixed Rate Loan. In
the event interest for the period from the Conversion Date to but not
including the RC Payment Date is not paid by the applicable Borrower
with respect to any Fixed Rate Loan sold by the Selling RC Lenders to
Buying RC Lenders hereunder, the Buying RC Lenders shall pay to the
Administrative Agent for the account of the Selling RC Lenders
interest for such period on its portion of such Fixed Rate Loans at
the applicable Fixed Rate provided by this Agreement.
(V) Each Selling Lender hereby represents and warrants to each
Buying Lender that such Selling Lender owns the Loans, Letter of Credit
Obligations and the Commitment being sold and assigned hereby for its own
account and has not sold, transferred or encumbered any or all of its
interest in such Loans, Letter of Credit Obligations or Commitment, except
for participations which will be extinguished upon payment to Selling
Lender of an amount equal to the portion of the outstanding Loans and
Letter of Credit Obligations being sold by such Selling Lender.
(VI) From and after a Conversion Event and upon consummation of the
purchases and assignments set forth herein, each reference in this
Agreement to a Lender's Revolving Credit Share shall be to such Lender's
Pro Rata Share.
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2.5 Optional Payments: Mandatory Prepayments
(A) Optional Payments. Upon not less than one (1) Business Days prior
notice to the Administrative Agent, which notice shall be given not later than
12:00 noon Indianapolis time or local time, as applicable), the Borrowers may
from time to time repay or prepay, without penalty or premium all or any part of
outstanding Floating Rate Advances. Subject to payment of all amounts payable
pursuant to Section 3.4 and upon not less than one (1) Business Days prior
notice to the Administrative Agent, which notice shall be given not later than
12:00 noon (Indianapolis time or local time as applicable), the Borrowers may
from time to time repay or prepay all (but not part)of any Fixed Rate Advances.
Unless the aggregate outstanding principal balance of the applicable Loans is to
be prepaid in full, voluntary prepayments of the Loans shall be in the same
aggregate minimum amounts and integral multiples in excess of such amounts as
are required for borrowings of Loans of the same Type and in the same currency
as set forth in Section 2.9.
(B) Mandatory Prepayments. If on any Reset Date or the date of any
borrowing (of any Eurocurrency Rate Loan after giving effect to any Eurocurrency
Rate Loans to be made or prepaid on such date), (a) the Dollar Amount of all
Revolving Loan Obligations exceeds 105% of the Aggregate Revolving Loan
Commitments or (b) the Dollar Amount of all Eurocurrency Rate Loans in Agreed
Currencies other than Dollars exceeds 105% of the Maximum Eurocurrency Amount,
the Borrowers shall on such Reset Date or on the date of such borrowing prepay
Revolving Loans in an aggregate amount such that after giving effect thereof (y)
the Dollar Amount of all Revolving Loan Obligations is less than or equal to the
Aggregate Revolving Loan Commitments and (z) the Dollar Amount of all
Eurocurrency Rate Loans in Agreed Currencies other than Dollars is less than or
equal to the Maximum Eurocurrency Amount.
2.6 Reduction of Commitments. Brightpoint may permanently reduce the
Aggregate Revolving Loan Commitment in whole, or in part ratably among the
Lenders having Revolving Loan Commitments, in an aggregate minimum and integral
amounts of $3,000,000, upon at least three (3) Business Days' prior written
notice to the Administrative Agent, which notice shall specify the amount of any
such reduction; provided, however, that the amount of the Aggregate Revolving
Loan Commitment may not be reduced below the aggregate principal amount of the
outstanding Revolving Credit Obligations. All accrued facility fees shall be
payable on the effective date of any termination of the obligations of the
Lenders to make Loans hereunder.
2.7 Method of Borrowing. The Administrative Agent shall notify each Lender
having Revolving Loan Commitments by 1:00 p.m.(Indianapolis time) of each
Advance on the Borrowing Date of each Base Rate Advance, three Business Days
before the Borrowing Date of each Eurocurrency Rate Advance in Dollars and four
Business Days before the Borrowing Date for each Eurocurrency Rate Advance in an
Agreed Currency other than Dollars and, not later than 2:00 p.m. (Indianapolis
time) on each Borrowing Date, each Lender having Revolving Credit Commitments
shall make available its Revolving Loan or Loans, in funds immediately available
in Indianapolis, Indiana to the Administrative Agent at its address specified
pursuant to
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Article XIV hereof unless the Administrative Agent has notified the Lenders
that such Loan is to be made available to the applicable Borrower at the
Administrative Agent's Eurocurrency Payment Office, in which case each Lender
shall make available its Revolving Loan or Loans, in funds immediately
available to the Administrative Agent at its Eurocurrency Payment Office not
later than 1:00 p.m. (local time in the city of the Administrative Agent's
Eurocurrency Payment Office) in the Agreed Currency designated by the
Administrative Agent. The Administrative Agent will promptly make the funds so
received from the Lenders available to the applicable Borrower.
2.8 Method of Selecting Types and Interest Periods for Advances:
Determination of Applicable Margins. The Advances may be Floating Rate Advances
or Fixed Rate Advances, or a combination thereof, selected by the applicable
Borrower in accordance with this Article II. The applicable Borrower may
select, in accordance with this Article II, Rate Options and Interest Periods
applicable to portions of the Revolving Loans; provided all Swing Line Loans
shall be Floating Rate Loans bearing interest at the Base Rate.
(a) Method of Selecting Types and Interest Periods for Advances.
The applicable Borrower shall select the Type of Advance and, in the
case of each Fixed Rate Advance, the Interest Period and Agreed
Currency applicable to each Advance from time to time. The applicable
Borrower shall give the Administrative Agent irrevocable notice (a
"Borrowing Notice") (i) not later than 11:00 a.m. (Indianapolis time
or local time for Eurocurrency Rate Advances denominated in an Agreed
Currency other than Dollars) (i) on the Borrowing Date of each Base
Rate Advance; (ii) three Business Days before the Borrowing Date for
each Eurocurrency Rate Advance in Dollars; and (iii) four Business
Days before the Borrowing Date for each Eurocurrency Rate Advance in
an Agreed Currency other than Dollars, specifying: (i) the Borrowing
Date (which shall be a Business Day) of such Advance; (ii) the
aggregate amount of such Advance; (iii) the Type of Advance selected;
and (iv) in the case of each Eurocurrency Rate Advance, the Interest
Period and Agreed Currency applicable thereto. Each Advance in an
Agreed Currency other than Dollars must be a Eurocurrency Rate
Advance. There shall be no more than ten (10) Interest Periods in
effect with respect to all of the Revolving Loans at any time (with
Interest Periods for the same term but in different currencies or to
different Borrowers being treated as separate Interest Periods). The
Borrowers shall select Interest Periods so that, to the best of the
Borrowers' knowledge, it will not be necessary to prepay all or any
portion of any Fixed Rate Advance prior to the last day of the
applicable Interest Period in order to make mandatory prepayments as
required pursuant to the terms hereof. Each Floating Rate Advance
shall bear interest from and including the date of the making of such
Advance to (but not including) the date of repayment thereof at the
Base Rate, changing when and as such Base Rate changes. Each Fixed
Rate Advance shall bear interest from and including the first day of
the Interest Period applicable thereto to (but not including) the last
day of such Interest Period at the interest rate determined as
applicable to such Fixed Rate Advance. All Obligations (other than
Advances) shall bear
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interest from and including the date such amount is payable under the terms
of this Agreement or the other Loan Documents to (but not including) the
date of repayment thereof at the Base Rate, changing when and as such Base
Rate changes. Changes in the rate of interest on that portion of any
Advance maintained as a Floating Rate Loan or such other Obligations will
take effect simultaneously with each change in the applicable Floating
Rate.
(b) Determination of Applicable Margins, Applicable Letter of Credit
Fee and Applicable Facility Fee.
(i) Definitions. As used in this Section 2.8(b) and in this Agreement,
the following terms shall have the following meanings:
"Applicable Margins", "Applicable Facility Fee" and "Applicable
Letter of Credit Fee" shall mean the Applicable Floating Rate Margin
and/or Applicable Fixed Rate Margin, with respect to Loans and the
Applicable Facility Fee and/or Applicable Letter of Credit Fee, with
respect to fees payable as the case may be. The Applicable Margins
shall be determined, in accordance with the provisions of this Section
2.8(b), by reference to the following:
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Level I Level II Level III Level IV Level V
-----------------------------------------------------------------------------------
-----------------------------------------------------------------------------------
Leverage Ratio >4.00 to <= 4.00 to <= 3.00 to <= 2.00 to < 1.00 to
1.00 1.00 and 1.00 and 1.00 and 1.00
> 3.00 to > 2.00 to > 1.00 to
1.00 1.00 1.00
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Applicable Facility
Fee 0.25% 0.20% 0.15% 0.125% 0.10%
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
Applicable Fixed
Rate Margin 1.125% 0.925% 0.725% 0.50% 0.40%
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
Applicable Floating Rate
Margin 0% 0% 0% 0% 0%
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
Applicable Letter of
Credit Fee 1.125% .925% .725% .50% .40%
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
"Leverage Ratio" shall have the meaning ascribed to that term in
Section 6.4(D).
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(ii) Determination of Applicable Margins, Applicable Letter of Credit
Fee and Applicable Facility Fee.
(A) The Applicable Margin in respect of any Loan, the Applicable Letter
of Credit Fee payable under Section 2.24 and the Applicable Facility Fee
payable under Section 2.14(c) shall be determined by reference to the table
set forth in clause (i) above, as applicable, on the basis of the Leverage
Ratio (calculated as provided in Section 6.4(D)) determined by reference to
the most recent financial statements delivered pursuant to Section
6.1(A)(i) or 6.1(A)(ii); provided, however, for the period from the Closing
Date until the Applicable Margins, Applicable Letter of Credit Fee and
Applicable Facility Fee are first adjusted pursuant to clause (B) below, it
shall be assumed that the Leverage Ratio is at Level 2.
(B) Upon receipt of the financial statements delivered pursuant to
Section 6.1(A)(i) or Section 6.1(A)(ii), as applicable, the Applicable
Margins for all outstanding Loans, the Applicable Letter of Credit Fee and
Applicable Facility Fee shall be adjusted, such adjustment being effective
on the fifth (5th) Business Day after receipt of such financial statements
and the Compliance Certificate to be delivered in connection therewith;
provided, however, if the Borrowers shall not have timely delivered such
financial statements in accordance with Section 6.1(A)(i) or Section
6.1(A)(ii), as applicable, beginning with the date upon which such
financial statements should have been delivered and continuing until such
financial statements are delivered, it shall be assumed for purposes of
determining the Applicable Margins, the Applicable Facility Fee and the
Applicable Letter of Credit Fee that the Leverage Ratio was greater than
4.00 to 1.0.
2.9 Minimum Amount of Each Advance. Each Eurocurrency Rate Advance shall
be in the minimum amount of $1,000,000 or the Equivalent Amount of any Agreed
Currency other than Dollars (and in multiples of $250,000 or the Equivalent
Amount of any Agreed Currency other than Dollars if in excess thereof). Each
Base Rate Advance shall be in the minimum amount of $500,000 (and in multiples
of $250,000 if in excess thereof), provided, however, that any Base Rate Advance
may be in the amount of the unused Aggregate Revolving Loan Commitment.
2.10 Method of Selecting Types and Interest Periods for Conversion and
Continuation of Advances.
(A) Right to Convert. The Borrowers may elect from time to time, subject
to the provisions of Section 2.8, this Section 2.10, to convert all or any part
of a Loan (other than a Swing Line Loan) of any Type into any other Type or
Types of Loans; provided that any
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Conversion of any Fixed Rate Advance shall be made on, and only on, the last day
of the Interest Period applicable thereto.
(B) Automatic Conversion and Continuation. Floating Rate Loans shall
continue as Floating Rate Loans unless and until such Floating Rate Loans are
converted into Fixed Rate Loans. Fixed Rate Loans shall continue as Fixed Rate
Loans until the end of the then applicable Interest Period therefor, at which
time such Fixed Rate Loans (other than Fixed Rate Loans in an Agreed Currency
other than Dollars) shall be automatically converted into Floating Rate Loans
unless the applicable Borrower shall have given the Administrative Agent notice
in accordance with Section 2.10(D) requesting that, at the end of such Interest
Period, such Fixed Rate Loans continue as a Fixed Rate Loan. Fixed Rate Loans in
an Agreed Currency other than Dollars shall automatically continue as Fixed Rate
Loans with an Interest Period of one (1) month unless the applicable Borrower
notifies the Administrative Agent otherwise as provided herein.
(C) No Conversion Post-Default or Post-Unmatured Default. Notwithstanding
anything to the contrary contained in Section 2.10(A) or Section 2.10(B), no
Loan may be converted into or continued as a Fixed Rate Loan (other than a
Eurocurrency Rate Loan in an Agreed Currency other than Dollars for an Interest
Period only of one month) except with the consent of the Required Lenders when
any Default or Unmatured Default has occurred and is continuing.
(D) Conversion/Continuation Notice. The Borrower shall give the
Administrative Agent irrevocable notice (a "Conversion/Continuation Notice") of
each Conversion of a Floating Rate Loan into a Fixed Rate Loan or continuation
of a Fixed Rate Loan (i) for Eurocurrency Loans denominated in Dollars, not
later than 12:00 noon (Indianapolis) three Business Days prior to the date of
the requested Conversion or continuation and (ii) for Eurocurrency Loans
denominated in an Agreed Currency other than Dollars, not later than 11:00
(local time) four Business Days prior to the date of the requested Conversion or
continuation, in either case specifying: (1) the requested date (which shall be
a Business Day) of such Conversion or continuation; (2) the amount and Type of
the Loan to be converted or continued; and (3) the amounts of Fixed Rate Loan(s)
into which such Loan is to be converted or continued and the duration of the
Interest Periods applicable thereto. If no such notice is given with respect to
a Eurocurrency Rate Loan in an Agreed Currency other than Dollars, the Interest
Period applicable to the automatic continuation of such Loan shall be one month.
2.11 Default Rate. After the occurrence and during the continuance of a
Default, at the option of the Administrative Agent or at the direction of the
Required Lenders, the interest rate(s) applicable to the Obligations and the
letter of credit fee payable under Section 2.24 with respect to Facility Letters
of Credit shall be increased by two percent (2.0%) per annum above the Base
Rate, Eurocurrency Rate or Applicable Letter of Credit Fee, as applicable.
2.12 A Method of Payment. ll payments of principal, interest, and fees
hereunder, other than such payments which are due to the Alternate Currency
Lender, shall be made, without
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setoff, deduction or counterclaim, to the Administrative Agent (i) at
the Administrative Agent's office in Indianapolis, Indiana in immediately
available funds with respect to Advances denominated in Dollars and (ii) at the
Administrative Agent's Eurocurrency Payment Office in immediately available
funds with respect to any Eurocurrency Advance denominated in an Agreed Currency
other than Dollars, in each case, or at any other Lending Installation of the
Administrative Agent specified in writing (by 9:00 a.m. (Indianapolis time) on
the day before the date when due) by the Administrative Agent to the Borrower,
by 12:00 noon local time in Indianapolis with respect to Advances denominated in
Dollars and 12:00 noon local time at the applicable payment office with respect
to Advances denominated in an Agreed Currency other than Dollars on the date
when due and shall be made ratably among the applicable Lenders with respect to
Advances in proportion to their Revolving Credit Shares (unless such amount is
not to be shared ratably in accordance with the other terms hereof). Each
Advance shall be repaid or prepaid in the currency in which it was made in the
amount borrowed and interest payable thereon shall be paid in such currency.
Each payment delivered to the Administrative Agent for the account of any Lender
shall be delivered promptly by the Administrative Agent to such Lender in the
same type of funds which the Administrative Agent received at its address
specified pursuant to Article XIV or at any Lending Installation specified in a
notice received by the Administrative Agent from such Lender. The Borrowers
authorize the Administrative Agent to charge any account of any Borrower
maintained with NBD, as applicable, for each payment of principal, interest and
fees as it becomes due hereunder. Notwithstanding the foregoing provisions of
this Section, if, after the making of any Advance in any currency other than
Dollars, currency control or exchange regulations are imposed in the country in
which such currency is issued with the result that different types of such
currency (the "New Currency") are introduced and the type of currency in which
the Advance was made (the "Original Currency") no longer exists or the
applicable Borrower is not able to make payment to the Administrative Agent for
the account of the applicable Lenders in such Original Currency, then all
payments to be made by the applicable Borrower hereunder or under the Notes in
such Original Currency shall be made in such amount and such type of the New
Currency or Dollars as shall be equivalent to the amount of such payment
otherwise due hereunder or under the Notes in the Original Currency as
determined as of the date of repayment, it being the intention of the parties
hereto that the Borrowers take all risks of the imposition of any such currency
control or exchange regulations.
2.13 Notes, Telephonic Notices. The Administrative Agent is authorized to
record the principal amount of each of the Loans and each repayment with respect
to Loans on the schedule attached to the master Note issued to evidence the
Revolving Loans; in the event any Note is issued to any individual Lender, such
Lender is authorized to record the principal amount of each of its Loans and
each repayment with respect to its Loans on the schedule attached to its Note;
and the Swing Line Lender is authorized to record the principal amount of each
Swing Line Loan and each repayment with respect to such Loans on the schedules
attached to the Swing Line Loan Note; provided, however, in each such case that
the failure to so record shall not affect the applicable Borrower's obligations
under any such Note. In the event that any Note is issued to
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<PAGE> 59
any individual Lender, such Lender shall provide notice to that effect to the
Administrative Agent and the Administrative Agent shall make a notation on the
master Note reflecting such issuance. The Administrative Agent will hold the
Notes issued to them on behalf of other Lenders and will make the Notes
available for inspection by the applicable Borrower or any Lender during normal
business hours upon prior reasonable notice therefor. The Borrowers authorize
the Lenders and the Administrative Agent to extend Advances, effect selections
of Types of Advances and to transfer funds based on telephonic notices made by
any person or persons the Administrative Agent or any Lender in good faith
believes to be acting on behalf of one or more of the Borrowers. The Borrowers
agree to deliver promptly to the Administrative Agent a written confirmation,
signed by an Authorized Officer, if such confirmation is requested by the
Administrative Agent or any Lender, of each telephonic notice. If the written
confirmation differs in any material respect from the action taken by the
Administrative Agent and the Lenders, (i) the telephonic notice shall govern
absent manifest error and (ii) the Administrative Agent or the Lender, as
applicable, shall promptly notify the Authorizing Officer who provided such
confirmation of such difference.
2.14 Promise to Pay; Interest and Fees; Interest Payment Dates; Interest
and Fee Basis; Taxes; Loan and Control Accounts.
(A) Promise to Pay. Each of the Borrowers unconditionally promises to pay
when due the principal amount of each Loan made to it and all other Obligations
incurred by it, and to pay all unpaid interest accrued thereon, in accordance
with the terms of this Agreement and the Notes.
(B) Interest Payment Dates. Interest accrued on each Base Rate Loan shall
be payable on each Payment Date, commencing with the first such date to occur
after the date hereof, on any date on which the Base Rate Loan is prepaid,
whether due to acceleration or otherwise, and at maturity (whether by
acceleration or otherwise). Interest accrued on each Eurocurrency Rate Loan
shall be payable on the last day of its applicable Interest Period and on any
date on which the Eurocurrency Rate Loan is prepaid, whether by acceleration or
otherwise, and at maturity; provided, interest accrued on each Eurocurrency Rate
Loan having an Interest Period longer than three months shall also be payable on
the last day of each three-month interval during such Interest Period. Interest
accrued on the principal balance of all other Obligations shall be payable in
arrears (i) upon repayment thereof in full or in part, (ii) if not theretofore
paid in full, at the time such other Obligation becomes due and payable (whether
by acceleration or otherwise) and (iii) if not theretofore paid in full, on
demand, commencing on the first such day following the date such Obligation
became payable pursuant to the terms of this Agreement or the other Loan
Documents.
(C) Fees (i) Brightpoint shall pay to the Administrative Agent, for the
account of the Lenders in accordance with their Pro Rata Shares, a
non-refundable facility fee accruing at the rate of the Applicable Facility Fee
per annum from and after the Closing Date until the Termination Date on the
Aggregate Commitment in effect from time to time. Such facility fees
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<PAGE> 60
payable under this clause (C) shall be payable in advance (a) for the period
from the Closing Date to June 30, 1998, payable on the Closing Date, and (b)
thereafter quarterly in advance on each Payment Date commencing June 30, 1998.
In addition, on the Closing Date, Brightpoint shall pay to the Administrative
Agent for the account of the Lenders in accordance with their Pro Rata Shares,
the accrued and unpaid facility fees under the Original Credit Agreement through
to the Closing Date.
(ii) Brightpoint agrees to pay or cause the appropriate Subsidiary to pay
to the Administrative Agent and the Syndication Agent, as applicable, the fees
set forth in the letter agreements (A) between the Administrative Agent and
Brightpoint dated April 16, 1997 and (B) among Brightpoint, the Agents and the
Arranger dated April 16, 1997.
(D) Interest and Fee Basis. Interest on Eurocurrency Rate Loans and fees
shall be calculated for actual days elapsed on the basis of a 360-day year.
Interest on Base Rate Loans shall be calculated for actual days elapsed on the
basis of a 365/366-day year. Interest shall be payable for the day an Obligation
is incurred but not for the day of any payment on the amount paid if payment is
received prior to 1:00 p.m. local time in Indianapolis with respect to Advances
denominated in Dollars and 12:00 noon local time at the place of payment in the
Administrative Agent's applicable payment office with respect to Advances
denominated in an Agreed Currency other than Dollars. If any payment of
principal of or interest on a Loan or any payment of any other Obligations shall
become due on a day which is not a Business Day, such payment shall be made on
the next succeeding Business Day and, in the case of a principal payment, such
extension of time shall be included in computing interest in connection with
such payment; provided, however, if such extension of payment would cause
payment of principal or interest on any Fixed Rate Loan to be made in the next
following calendar month, such payment shall be made on the immediately
preceding Business Day.
(E) Taxes
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(i) Any and all payments by any of the Borrowers or Guarantors hereunder
shall be made free and clear of and without deduction for any and all present or
future taxes, levies, imposts, deductions, charges or withholdings or any
liabilities with respect thereto including those arising after the date hereof
as a result of the adoption of or any change in any law, treaty, rule,
regulation, guideline or determination of a Governmental Authority or any change
in the interpretation or application thereof by a Governmental Authority but
excluding, in the case of each Lender and the Administrative Agent, such taxes
(including income taxes, franchise taxes and branch profit taxes) as are imposed
on or measured by such Lender's or Administrative Agent's, as the case may be,
income by the United States of America or any Governmental Authority of the
jurisdiction under the laws of which such Lender or Administrative Agent, as the
case may be, is organized or incorporated (all such non-excluded taxes, levies,
imposts, deductions, charges, withholdings, and liabilities which the
Administrative Agent or a Lender determines to be applicable to this Agreement,
the other Loan Documents, the Revolving Loan Commitments, the Loans or the
Letters of Credit being hereinafter referred to as "Taxes"). Subject to Section
2.14(E)(vii), if any of the Borrowers or Guarantors shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder or under the
other Loan Documents to any Lender or the Administrative 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 2.14(E)) such Lender or Administrative Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) such Borrower or Guarantor shall make such
deductions, and (iii) such Borrower or Guarantor shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable law. If a withholding tax of the United States of America or any
other Governmental Authority shall be or become applicable (y) after the date of
this Agreement, to such payments by either of the Borrowers made to the Lending
Installation or any other office that a Lender may claim as its Lending
Installation, or (z) after such Lender's selection and designation of any other
Lending Installation, to such payments made to such other Lending Installation,
such Lender shall use reasonable efforts to make, fund and maintain its Loans
through another Lending Installation of such Lender in another jurisdiction so
as to reduce the Borrowers' liability hereunder, if the making, funding or
maintenance of such Loans through such other Lending Installation of such Lender
does not, in the good faith judgment of such Lender, otherwise adversely affect
such Loans, or obligations under the Revolving Loan Commitments or such Lender.
With respect to such deduction or withholding for or on account of any Taxes and
to confirm that all such Taxes have been paid to the appropriate Governmental
Authorities, Brightpoint shall promptly (and in any event not later than thirty
(30) days after receipt) furnish to each Lender and the Administrative Agent
such certificates, receipts and other documents as may be required (in the
judgment of such Lender or the Administrative Agent) to establish any tax credit
to which such Lender or the
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Administrative Agent may be entitled. A payment may be
made by Brightpoint or by the Subsidiary that is the Borrower with
respect to the Loan that gives rise to such payment.
(ii) In addition, Brightpoint agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges,
or similar levies that arise from any payment made hereunder, from the
issuance of Letters of Credit hereunder, or from the execution, delivery
or registration of, or otherwise with respect to, this Agreement, the
other Loan Documents, the Revolving Loan Commitments, the Loans or the
Letters of Credit (hereinafter referred to as "Other Taxes").
(iii) Subject to Section 2.14(E)(vii), Brightpoint indemnifies each
Lender and the Administrative Agent for the full amount of Taxes and Other
Taxes (including, without limitation, any Taxes or Other Taxes imposed by
any Governmental Authority on amounts payable under this Section 2.14(E))
paid by such Lender or the Administrative Agent (as the case may be) and
any liability (including penalties, interest, and expenses) arising
therefrom or with respect thereto, whether or not such Taxes or Other
Taxes were correctly or legally asserted. This indemnification shall be
made within thirty (30) days after the date such Lender or the
Administrative Agent (as the case may be) makes written demand therefor. A
certificate as to any additional amount payable to any Lender or the
Administrative Agent under this Section 2.14(E) submitted to Brightpoint
and the Administrative Agent (if a Lender is so submitting) by such Lender
or the Administrative Agent shall show in reasonable detail the amount
payable and the calculations used to determine such amount and shall,
absent manifest error, be final, conclusive and binding upon all parties
hereto.
(iv) Within thirty (30) days after the date of any payment of Taxes or
Other Taxes by any Borrower or Guarantor, such Borrower or Guarantor shall
furnish to the Administrative Agent the original or a certified copy of a
receipt evidencing payment thereof.
(v) Without prejudice to the survival of any other agreement of either
of the Borrowers or Guarantor hereunder, the agreements and obligations of
the Borrowers and Guarantor contained in this Section 2.14(E) shall
survive the payment in full of principal and interest hereunder, the
termination of the Letters of Credit and the termination of this
Agreement.
(vi) Without limiting the obligations of the Borrowers and Guarantors
under this Section 2.14(E) (except as expressly provided by subsection
(vii) below), each Lender that has a Revolving Loan Commitment that is not
created or organized under the laws of the United States of America or a
political subdivision thereof shall deliver to Brightpoint and the
Administrative Agent on or before the Closing Date, or, if later, the date
on which such Lender becomes a Lender pursuant to Section 13.3 hereof, a
true and accurate
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certificate executed in duplicate by a duly authorized officer of such
Lender, in a form satisfactory to Brightpoint and the Administrative Agent, to
the effect that such Lender is capable under the provisions of an applicable tax
treaty concluded by the United States of America (in which case the certificate
shall be accompanied by two executed copies of Form 1001 of the IRS) or under
Section 1442 of the Code (in which case the certificate shall be accompanied by
two copies of Form 4224 of the IRS) of receiving payments of interest and fees
hereunder without deduction or withholding of United States federal income tax.
Further, each Lender which delivers a certificate accompanied by Form 1001 of
the IRS covenants and agrees to deliver to Brightpoint and the Administrative
Agent within fifteen (15) days prior to January 1, 1999, and every third (3rd)
anniversary of such date thereafter, on which this Agreement is still in effect,
another such certificate and two accurate and complete original signed copies of
Form 1001 (or any successor form or forms required under the Code or the
applicable regulations promulgated thereunder), and each Lender that delivers a
certificate accompanied by Form 4224 of the IRS covenants and agrees to deliver
to Brightpoint and the Administrative Agent within fifteen (15) days prior to
the beginning of each subsequent taxable year of such Lender during which this
Agreement is still in effect, another such certificate and two accurate and
complete original signed copies of IRS Form 4224 (or any successor form or forms
required under the Code or the applicable regulations promulgated thereunder).
Each such certificate shall certify pursuant to this Section 2.14(E)(vi)
as to one of the following:
(a) that such Lender is capable of receiving payments of interest
hereunder without deduction or withholding of United States of America
federal income tax;
(b) that such Lender is not capable of receiving payments of
interest hereunder without deduction or withholding of the applicable
income tax as specified therein but is capable of recovering the full
amount of any such deduction or withholding from a source other than the
Borrowers and the Guarantors and will not seek any such recovery from the
Borrowers or the Guarantors; or
(c) that, as a result of the adoption of or any change in any law,
treaty, rule, regulation, guideline or determination of a Governmental
Authority or any change in the interpretation or application thereof by a
Governmental Authority after the date such Lender became a party hereto,
such Lender is not capable of receiving payments of interest hereunder
without deduction or withholding of applicable income tax as specified
therein and that it is not capable of recovering the full amount of the
same from a source other than the Borrowers and the Guarantors.
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Each Lender shall promptly furnish to Brightpoint or the
Administrative Agent such additional documents as may be reasonably
required by Brightpoint or the Administrative Agent to establish any
exemption from or reduction of any Taxes or Other Taxes required to be
deducted or withheld and which may be obtained without undue expense to
such Lender.
A Borrower shall provide such information and take such action as a
Lender may reasonably request without undue expense to such Borrower to
enable the Lender to comply with the foregoing provisions of this
subsection (vi).
(vii) None of the Borrowers shall be required to pay any additional
amounts under subsection (i) above or indemnification under subsection
(iii) above to the extent that the obligation to pay such additional
amounts or indemnification would not have arisen but for: (a) a failure by
the Lender or Administrative Agent to comply with the provisions of
subsection (vi) above; or (b) the certifications referred to in subsection
(vi) above not being true.
(viii) Each Lender and the Administrative Agent agree that if it shall
become aware that it is entitled to receive a refund in respect of Taxes or
Other Taxes as to which it has been indemnified by Brightpoint or any other
Borrower pursuant to this Section 2.14(E), it shall promptly notify
Brightpoint of the availability of such refund and at the request of
Brightpoint will apply for such refund; provided, however the failure to
provide such notice shall not relieve Brightpoint or any other Borrower
of any of their Obligations hereunder. Upon receipt of such refund, the
Lender or Administrative Agent agrees to pay such refund to the applicable
Borrower along with any interest actually received from the taxing
authority, net of all out-of-pocket expenses of such Lender or
Administrative Agent incurred with respect to such refund.
(F) Loan Account. Each Lender shall maintain in accordance with its usual
practice an account or accounts (a "Loan Account") evidencing the Obligations of
each of the Borrowers to such Lender owing to such Lender from time to time,
including the amount of principal and interest payable paid to such Lender from
time to time hereunder and under the Notes.
(G) Control Account. The Register maintained by the Administrative Agent
pursuant to Section 13.3(C) shall include a control account, and a Subsidiary
account for each Lender and each Borrower, in which accounts (taken together)
shall be recorded (i) the date and amount of each Advance made hereunder, the
type and currency of each Loan comprising such Advance, the Borrower of such
Advance, and any Interest Period applicable thereto, (ii) the effective date and
amount of each assignment and acceptance delivered to and accepted by it and the
parties thereto pursuant to Section 13.3, (iii) the amount of any principal or
interest due and payable or to become due and payable from any Borrower to each
Lender hereunder or under the Notes,
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(iv) the amount of any sum received by the Administrative Agent from each of the
Borrowers hereunder and each Lender's share thereof, and (v) all other
appropriate debits and credits as provided in this Agreement, including, without
limitation, all fees, charges, expenses and interest.
(H) Entries Binding. The entries made in the Register and each Loan Account
shall be conclusive and binding for all purposes, absent manifest error, unless
the Borrowers object to information contained in the Register and each Loan
Account within thirty (30) days of the Borrowers' receipt of such information.
2.15 Notification of Advances, Interest Rates, Prepayments and Aggregate
Revolving Loan Commitment Reductions. Promptly after receipt thereof, the
Administrative Agent will notify each applicable Lender of the contents of each
Aggregate Revolving Loan Commitment reduction notice, Borrowing Notice for
Revolving Loans, Continuation/Conversion Notice with respect to Revolving Loans,
and repayment notice received by it hereunder. The Administrative Agent will
notify each applicable Lender of the interest rate applicable to each
Eurocurrency Rate Loan promptly upon determination of such interest rate, the
Administrative Agent will give each applicable Lender prompt notice of each
change in the Alternate Base Rate.
2.16 Lending Installations. Each Lender may book its Loans at any Lending
Installation selected by such Lender and may change its Lending Installation
from time to time. All terms of this Agreement shall apply to any such Lending
Installation and the Notes shall be deemed held by each Lender for the benefit
of such Lending Installation. Each Lender may, by written or facsimile notice to
the Administrative Agent and the Borrowers, designate a Lending Installation
through which Loans will be made by it and for whose account Loan payments are
to be made.
2.17 Non-Receipt of Funds by the Administrative Agent. Unless the
applicable Borrower or a Lender, as the case may be, notifies the Administrative
Agent prior to the date on which it is scheduled to make payment to the
Administrative Agent of (i) in the case of a Lender, the proceeds of a Loan or
(ii) in the case of a Borrower, a payment of principal, interest or fees to the
Administrative Agent for the account of the Lenders, that it does not intend to
make such payment, the Administrative Agent may assume that such payment has
been made. The Administrative Agent may, but shall not be obligated to, make the
amount of such payment available to the intended recipient in reliance upon such
assumption. If such Lender or Borrower, as the case may be, has not in fact made
such payment to the Administrative Agent, the recipient of such payment shall,
on demand by the Administrative Agent, repay to the Administrative Agent the
amount so made available together with interest thereon in respect of each day
during the period commencing on the date such amount was so made available by
the Administrative Agent until the date the Administrative Agent recovers such
amount at a rate per annum equal to (i) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day or (ii) in the case of payment by a
Borrower, the interest rate applicable to the relevant Loan.
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2.18 Termination Date. This Agreement shall be effective until the
Termination Date. Notwithstanding the termination of this Agreement on the
Termination Date, until all of the Obligations (other than contingent indemnity
and reimbursement obligations) shall have been fully and indefeasibly paid and
satisfied, all financing arrangements among the Borrowers and the Lenders shall
have been terminated (other than under Hedging Agreements) and all of the
Letters of Credit shall have expired, been canceled or terminated, all of the
rights and remedies under this Agreement and the other Loan Documents shall
survive and the Administrative Agent shall be entitled to retain its security
interest in and to all existing and future Collateral for the benefit of itself
and the Holders of Secured Obligations.
2.19 Replacement of Certain Lenders. In the event a Lender ("Affected
Lender") shall have: (i) failed to fund its Revolving Credit Share of any
Advance requested by either Brightpoint or BPI which such Lender is obligated
to fund under the terms of this Agreement and which failure has not been cured,
(ii) requested compensation from any Borrower under Sections 2.14(E)4, 3.1 or
3.2 to recover Taxes, Other Taxes or other additional costs incurred by such
Lender which are not being incurred generally by the other Lenders, (iii)
delivered a notice pursuant to Section 3.3 claiming that such Lender is unable
to extend Eurocurrency Rate Loans to any Borrower for reasons not generally
applicable to the other Lenders or (iv) has invoked Section 10.2, then, in any
such case, any Borrower or the Administrative Agent may make written demand on
such Affected Lender (with a copy to the Administrative Agent in the case of a
demand by any Borrower and a copy to the Borrowers in the case of a demand by
the Administrative Agent) for the Affected Lender to assign, and such Affected
Lender shall use its best efforts to assign pursuant to one or more duly
executed assignment and acceptance agreements in substantially the form of
Exhibit H five (5) Business Days after the date of such demand, to one or more
financial institutions that comply with the provisions of Section 13.3(A) (and,
if selected by the Borrowers is reasonably acceptable to the Administrative
Agent) which any Borrower or the Administrative Agent, as the case may be,
shall have engaged for such purpose ("Replacement Lender"), all of such
Affected Lender's rights and obligations under this Agreement and the other
Loan Documents (including, without limitation, its Revolving Loan Commitment,
all Loans owing to it, all of its participation interests in existing Facility
Letters of Credit, and its obligation to participate in Facility Letters of
Credit and Swing Line Loans hereunder) in accordance with Section 12.3. The
Administrative Agent agrees, upon the occurrence of such events with respect to
an Affected Lender and upon the written request of any Borrower, to use its
reasonable efforts to obtain the commitments from one or more financial
institutions qualified to act as a Replacement Lender. Further, with respect to
such assignment the Affected Lender shall have concurrently received, in cash,
all amounts due and owing to the Affected Lender hereunder or under any other
Loan Document, including, without limitation, the aggregate outstanding
principal amount of the Loans owed to such Lender, together with accrued
interest thereon through the date of such assignment, amounts payable under
Sections 2.14(E), 3.1, and 3.2 with respect to such Affected Lender and
compensation payable under Section 2.14(C) in the event of any replacement of
any Affected Lender under clause (ii) or clause (iii) of this Section 2.19;
provided that upon such Affected Lender's replacement, such Affected Lender
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shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.14(E), 3.1, 3.2, 3.4, and 10.7, as well as to any fees
accrued for its account hereunder and not yet paid, and shall continue to be
obligated under Section 11.8. Upon the replacement of any Affected Lender
pursuant to this Section 2.19, the provisions of Section 8.2 shall continue to
apply with respect to Advances which are then outstanding with respect to which
the Affected Lender failed to fund its Revolving Credit Share and which failure
has not been cured.
2.20 Letter of Credit Facility. Upon receipt of duly executed applications
therefor, and such other documents, instructions and agreements as such Issuing
Lender may reasonably require, and subject to the provisions of Article IV, the
Administrative Agent shall, or any other Lender in its sole discretion may,
issue letters of credit denominated in Dollars or in any Agreed Currency for the
account of Brightpoint or BPI, on terms as are satisfactory to such Issuing
Lender; provided, however, that no Facility Letter of Credit will be issued for
the account of Brightpoint or BPI by an Issuing Lender if on the date of
issuance, before or after taking such Facility Letter of Credit into account,
(i) the Dollar Amount of the Revolving Credit Obligations at such time would
exceed the Aggregate Revolving Loan Commitments at such time or (ii) the
aggregate outstanding Dollar Amount of the L/C Obligations exceeds Forty Million
and 00/100 Dollars ($40,000,000); and provided, further, that no Facility Letter
of Credit shall be issued which has an expiration date more than one year after
the date of issuance of such Facility Letter of Credit or an expiration date
later than the date which is five (5) Business Days immediately preceding the
Termination Date; provided, further, that although such letters of credit were
issued prior to the date of this Agreement, effective on the Closing Date all
Existing Letters of Credit shall be treated as Facility Letters of Credit
hereunder. Each Facility Letter of Credit may, upon the request of the
applicable Borrower, include a provision whereby such Facility Letter of Credit
shall be renewed automatically for additional consecutive periods of 12 months
or less (but not beyond the date that is five Business Days prior to the
Termination Date) unless the Issuing Lender notifies the beneficiary thereof at
least 30 days prior to the then-applicable expiry date that such Facility Letter
of Credit will not be renewed. Prior to issuing any Facility Letter of Credit,
the applicable Issuing Lender shall request and the Administrative Agent shall
provide confirmation that the request for such Facility Letter of Credit
complies with the provisions of this Section 2.20. If the Administrative Agent
notifies the applicable Issuing Lender that it is authorized to issue such
Facility Letter of Credit, and the conditions described in Article IV have been
satisfied, then such Issuing Lender shall issue such Facility Letter of Credit
as requested. The applicable Issuing Lender shall give the Administrative Agent
and each Lender prompt notice of the issuance of any such Facility Letter of
Credit by it. Each Issuing Lender shall furnish to the Administrative Agent and
each Lender on the first Business Day of each month a written report, with
respect to each outstanding Facility Letter of Credit issued by such Issuing
Lender, summarizing whether such Facility Letter of Credit is a standby or
commercial Facility Letter of Credit, the maximum amount available to be drawn
thereon, and the beneficiary and the issuance and expiration dates thereof.
Together with each such monthly report each Issuing Lender shall provide the
Administrative Agent a copy of each Facility Letter of Credit issued by such
Issuing Bank during the previous month.
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2.21 Facility Letter of Credit Participation. Immediately on the Closing
Date with respect to the Existing Letters of Credit and upon the issuance of
each Facility Letter of Credit by any Issuing Lender hereunder, each Lender that
has a Revolving Loan Commitment shall be deemed to have automatically,
irrevocably and unconditionally purchased and received from the applicable
Issuing Lender an undivided interest and participation in and to such Facility
Letter of Credit, the obligations of the applicable Borrower in respect thereof,
and the liability of the applicable Issuing Lender thereunder (collectively, an
"L/C Interest") in an amount equal to the amount available for drawing under
such Facility Letter of Credit multiplied by such Lender's Revolving Credit
Share.
The applicable Issuing Lender will notify the Administrative Agent
promptly upon presentation to it of an L/C Draft or upon any other draw under a
Facility Letter of Credit and the Administrative Agent will promptly notify each
Lender that has a Revolving Loan Commitment. On or before the Business Day on
which the applicable Issuing Lender makes payment of each such L/C Draft or any
other draw on a Facility Letter of Credit, on demand of the Issuing Lender
received by each Lender that has a Revolving Loan Commitment not later than 1:00
p.m. (Indianapolis time) on such Business Day, each Lender shall make payment on
such Business Day to the Administrative Agent for the account of the applicable
Issuing Lender, in immediately available funds in the applicable currency in an
amount equal to such Lender's Revolving Credit Share of the amount of such
payment or draw.
Upon the Administrative Agent's receipt of funds as a result of an Issuing
Lender's payment on an L/C Draft or any other draw on a Facility Letter of
Credit issued by an Issuing Lender, the Administrative Agent shall promptly pay
such funds to the Issuing Lender. The obligation of each Lender that has a
Revolving Loan Commitment to pay the Administrative Agent for the account of the
applicable Issuing Lender under this Section 2.21 shall be unconditional,
continuing, irrevocable and absolute. In the event that any such Lender fails to
make payment to the Administrative Agent of any amount due under this Section
2.21, the Administrative Agent shall be entitled to receive, retain and apply
against such obligation the principal and interest otherwise payable to such
Lender hereunder until the Administrative Agent on behalf of the applicable
Issuing Lender receives such payment from such Lender or such obligation is
otherwise fully satisfied; provided, however, that nothing contained in this
sentence shall relieve such Lender of its obligation to reimburse the
Administrative Agent for such amount in accordance with this Section 2.21.
2.22 Reimbursement Obligation. Each of the Borrowers agrees
unconditionally, irrevocably and absolutely upon receipt of notice from the
Administrative Agent or the applicable Issuing Lender to pay immediately to the
Administrative Agent, for the account of the applicable Issuing Lender or the
account of the Lenders, as the case may be, the amount of each advance which may
be drawn under or pursuant to a Facility Letter of Credit issued for its account
or an L/C Draft related thereto (such obligation of each of the Borrowers to
reimburse
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the Issuing Lender or the Administrative Agent for an advance made under a
Facility Letter of Credit or L/C Draft being hereinafter referred to as a
"Reimbursement Obligation" with respect to such Facility Letter of Credit or L/C
Draft), each such payment to be made by the applicable Borrower to the
Administrative Agent no later than 2:00 p.m. (Indianapolis time) on the Business
Day on which the applicable Issuing Lender makes payment of each such L/C Draft
or, in the case of any other draw on a Facility Letter of Credit, 2:00 p.m.
(Indianapolis time) on the date specified in a demand by the Administrative
Agent and such payment shall be made in the applicable currency in which such
Facility Letter of Credit was issued. Any Issuing Lender may direct the
Administrative Agent to make such demand with respect to Facility Letters of
Credit issued by such Issuing Lender. If any Borrower at any time fails to repay
a Reimbursement Obligation pursuant to this Section 2.22, such Borrower shall be
deemed to have elected to borrow a Revolving Loan from the applicable Lenders,
as of the date of the Advance giving rise to the Reimbursement Obligation equal
in amount to the amount of the unpaid Reimbursement Obligation. Such Revolving
Loan shall be made as of the date of the payment giving rise to such
Reimbursement Obligation, automatically, without notice and without any
requirement to satisfy the conditions precedent otherwise applicable to an
Advance of Revolving Loans if such Borrower shall have failed to make such
payment to the Administrative Agent for the account of the applicable Issuing
Lender prior to such time. Such Revolving Loans shall constitute a Base Rate
Advance, the proceeds of which Advance shall be used to repay such Reimbursement
Obligation. If, for any reason, such Borrower fails to repay a Reimbursement
Obligation on the day such Reimbursement Obligation arises and, for any reason,
the Lenders are unable to make or have no obligation to make a Revolving Loan,
then such Reimbursement Obligation shall bear interest from and after such day,
until paid in full, at the interest rate applicable to a Base Rate Advance.
2.23 Cash Collateral. Notwithstanding anything to the contrary herein or in
any application for a Facility Letter of Credit, after the occurrence and during
the continuance of Default, each Borrower shall, upon the Administrative Agent's
demand, deliver to the Administrative Agent for the benefit of the Lenders,
cash, or other collateral of a type satisfactory to the Required Lenders, having
a value, as determined by such Lenders, equal to the aggregate outstanding L/C
Obligations of such Borrower. Any such collateral shall be held by the
Administrative Agent in a separate account appropriately designated as a cash
collateral account in relation to this Agreement and the Facility Letters of
Credit and retained by the Administrative Agent for the benefit of the Lenders
as collateral security for the Borrowers' obligations in respect of this
Agreement and each of the Facility Letters of Credit and L/C Drafts. Such
amounts shall be applied to reimburse the Administrative Agent or each Issuing
Lender, as applicable, for drawings or payments under or pursuant to Facility
Letters of Credit or L/C Drafts, or if no such reimbursement is required, to
payment of such of the other Obligations as the Administrative Agent shall
determine. If no Default shall be continuing, amounts remaining in any cash
collateral account established pursuant to this Section 2.23 which are not to be
applied to reimburse the Administrative Agent for amounts actually paid or to be
paid by the Administrative Agent in respect of a Facility Letter of Credit or
L/C Draft, shall be returned to
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the applicable Borrower (after deduction of the Administrative Agent's expenses
incurred in connection with such cash collateral account).
2.24 Facility Letter of Credit Fees. Each of the Borrowers agrees to pay
(i) quarterly, in arrears, on each Payment Date to the Administrative Agent for
the ratable benefit of the Lenders having Revolving Loan Commitments, except as
set forth in Section 8.2, a letter of credit fee ("Letter of Credit Fee") in the
amount of the Applicable Letter of Credit Fee Rate per annum on the aggregate
average daily outstanding Dollar Amount available for drawing under all of the
Facility Letters of Credit issued for its account, and (ii) to the
Administrative Agent for the benefit of the Issuing Lenders, a fronting fee of
one-eighth of one percent (0.125%) per annum on the aggregate average daily
outstanding Dollar Amount available for drawing under all of the Facility
Letters of Credit issued for its account payable quarterly, in arrears, on each
Payment Date, plus all customary fees and other issuance, amendment, document
examination, negotiation and presentment expenses and related charges in
connection with the issuance, amendment, presentation of L/C Drafts, and the
like customarily charged by the Issuing Lender with respect to standby and
commercial Facility Letters of Credit, including, without limitation, standard
commissions with respect to commercial Facility Letters of Credit, payable at
the time of invoice of such amounts.
2.25 Idemnification; Exoneration. (a) In addition to amounts payable as
elsewhere provided in this Agreement, each Borrower with respect to Facility
Letters of Credit issued for its account agrees to protect, indemnify, pay and
save harmless the Administrative Agent, each Issuing Lender and each Lender from
and against any and all liabilities and costs which the Administrative Agent,
any Issuing Lender or any Lender may incur or be subject to as a consequence,
direct or indirect, of (i) the issuance of any Facility Letter of Credit other
than, in the case of the Issuing Lender, as a result of its Gross Negligence or
willful misconduct, as determined by the final judgment of a court of competent
jurisdiction, or (ii) the failure of the Issuing Lender of a Facility Letter of
Credit to honor a drawing under such Facility Letter of Credit as a result of
any act or omission, whether rightful or wrongful, of any present or future de
jure or de facto Governmental Authority (all such acts or omissions herein
called "Governmental Acts").
(b) As among the Borrowers, the Lenders, the Issuing Lenders and the
Administrative Agent, the Borrowers assume all risks of the acts and omissions
of, or misuse of such Facility Letter of Credit by, the beneficiary of any
Facility Letter of Credit. In furtherance and not in limitation of the
foregoing, subject to the provisions of the Facility Letter of Credit
applications and Facility Letter of Credit reimbursement agreements executed by
the applicable Borrower at the time of request for any Facility Letter of
Credit, the Issuing Lender of a Facility Letter of Credit, the Administrative
Agent and the Lenders shall not be responsible (in the absence of Gross
Negligence or willful misconduct in connection therewith, as determined by the
final judgment of a court of competent jurisdiction): (i) for the form,
validity, sufficiency, accuracy, genuineness or legal effect of any document
submitted by any party in connection with the
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application for and issuance of the Facility Letters of Credit, even if it
should in fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent or forged; (ii) for the validity or sufficiency of any
instrument transferring or assigning or purporting to transfer or assign a
Facility Letter of Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, which may prove to be invalid or ineffective for
any reason; (iii) for failure of the beneficiary of a Facility Letter of Credit
to comply duly with conditions required in order to draw upon such Facility
Letter of Credit; (iv) for errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telegraph, telex, or
other similar form of teletransmission or otherwise; (v) for errors in
interpretation of technical trade terms; (vi) for any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any Facility Letter of Credit or of the proceeds thereof; (vii) for the
misapplication by the beneficiary of a Facility Letter of Credit of the
proceeds of any drawing under such Facility Letter of Credit; and (viii) for
any consequences arising from causes beyond the control of the Administrative
Agent, the Issuing Lender and the Lenders including, without limitation, any
Governmental Acts. None of the above shall affect, impair, or prevent the
vesting of any of the Issuing Lender's rights or powers under this Section
2.25.
(c) In furtherance and extension and not in limitation of the specific
provisions hereinabove set forth, any action taken or omitted by an Issuing
Lender under or in connection with Facility Letters of Credit issued on behalf
of either Brightpoint or BPI or any related certificates shall not, in the
absence of Gross Negligence or willful misconduct, as determined by the final
judgment of a court of competent jurisdiction, put the Issuing Lender, the
Administrative Agent or any Lender under any resulting liability to any
Borrower or relieve any Borrower of any of its obligations hereunder to any
such Person.
(d) Without prejudice to the survival of any other agreement of the
Borrowers hereunder, the agreements and obligations of the Borrowers contained
in this Section 2.25 shall survive the payment in full of principal and
interest hereunder, the termination of the Facility Letters of Credit and the
termination of this Agreement.
2.26 Judgement Currency. If, for the purposes of obtaining judgment in any
court, it is necessary to convert a sum due from a Borrower hereunder or under
any of the Notes in the currency expressed to be payable herein or under the
Notes (the "specified currency") into another currency, the parties hereto
agree, to the fullest extent that they may effectively do so, that the rate of
exchange used shall be that at which in accordance with normal banking
procedures the Administrative Agent could purchase the specified currency with
such other currency at the Administrative Agent's principal office in
Indianapolis, Indiana on the Business Day preceding that on which the final,
non-appealable judgment is given. The obligations of the applicable Borrower in
respect of any sum due to any Lender or any Agent hereunder or under any Note
shall, notwithstanding any judgment in a currency other than the specified
currency, be discharged only to the extent that on the Business Day following
receipt by such Lender or Agent (as the case may be) of any sum adjudged to be
so due in such other currency such Lender or
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Agent (as the case may be) may in accordance with normal, reasonable banking
procedures purchase the specified currency with such other currency. If the
amount of the specified currency so purchased is less than the sum originally
due to such Lender or Agent, as the case may be, in the specified currency, the
applicable Borrower agrees, to the fullest extent that it may effectively do so,
as a separate obligation and notwithstanding any such judgment, to indemnify
such Lender or Agent, as the case may be, against such loss, and if the amount
of the specified currency so purchased exceeds (a) the sum originally due to any
Lender or Agent, as the case may be, in the specified currency and (b) any
amounts shared with other Lenders as a result of allocations of such excess as a
disproportionate payment to such Lender under Section 12.2, such Lender or
Agent, as the case may be, agrees to remit such excess to the applicable
Borrower. Without prejudice to the survival of any of the other agreements of
the Borrowers hereunder, the agreements and obligations of the Borrowers in this
Section 2.26 shall survive the termination of this Agreement and the payment of
all other amounts owing hereunder.
2.27 Market Disruption; Deposits Unavailable, Interest Rate Unascertainable
or Inadequate; Impracticability. Notwithstanding the satisfaction of all
conditions referred to in Article II with respect to any Advance in any currency
other than Dollars, if there shall occur on or prior to the date of such Advance
any event which results in a currency no longer qualifying as an Eligible
Currency or any change in national or international financial, political or
economic conditions or currency exchange rates or exchange controls which would
in the reasonable opinion of the Administrative Agent or the Required Lenders
make it impracticable for the Eurocurrency Rate Loans comprising such Advance to
be denominated in the currency specified by the applicable Borrower, then the
Administrative Agent shall forthwith give notice thereof to Brightpoint and the
Lenders, and such Loans shall not be denominated in such currency but shall be
made on such Borrowing Date as Base Rate Loans in Dollars, in an aggregate
principal amount equal to the Dollar Amount of the aggregate principal amount
specified in the related Borrowing Notice unless the applicable Borrower
notifies the Administrative Agent at least one Business Day before such date
that (i) it elects not to borrow on such date or (ii) with respect to
Eurocurrency Rate Loans it elects to borrow on such date in a different
currency, as the case may be, in which the denomination of such Loans would in
the opinion of the Administrative Agent and the Required Lenders be practicable
and in an aggregate principal amount equal to the Dollar Amount of the aggregate
principal amount specified in the related Borrowing Notice. If, and on each
occasion, that on the day two Business Days prior to the commencement of any
Interest Period for a Eurocurrency Advance the Administrative Agent shall have
determined (i) that deposits in the applicable currency in the principal amounts
of the Loans comprising such Advance are not generally available in the London
interbank market or any other market in which the Lenders shall be funding such
Loans, (ii) that the rates at which such deposits in the applicable currency are
being offered will not adequately and fairly reflect the cost to the Required
Lenders of making or maintaining their Eurocurrency Rate Loans during such
Interest Period or (iii) that reasonable means do not exist for ascertaining the
Eurocurrency Rate, the Administrative Agent shall, as soon as practicable
thereafter, give telecopy notice of such determination to Brightpoint and the
applicable Lenders. In the event of any such determination,
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until the Administrative Agent shall have advised Brightpoint and the
applicable Lenders that the circumstances giving rise to such notice no longer
exist, any request by a Borrower for a Eurocurrency Advance pursuant to Section
2.7 shall be of no force and effect and shall be denied by the Administrative
Agent, and any request by a Borrower for a Eurocurrency Advance denominated in
Dollars pursuant to Section 2.7 shall be deemed to be a request for a Base Rate
Advance. Each determination by the Administrative Agent hereunder shall be
presumed correct in the absence of facts indicating that such determination is
erroneous (it being understood that the Borrower shall not have access to the
internal records of the Administrative Agent or any Lender for the purpose of
confirming such determination).
ARTICLE III: CHANGE IN CIRCUMSTANCES
3.1 Yield Protection. If any law or any governmental or quasi-governmental
rule, regulation, policy, guideline or directive (whether or not having the
force of law) adopted after the date of this Agreement and having general
applicability to all banks within the jurisdiction in which such Lender
operates (excluding, for the avoidance of doubt, the effect of and phasing in
of capital requirements or other regulations or guidelines passed prior to the
date of this Agreement), or any interpretation or application thereof by any
Governmental Authority charged with the interpretation or application thereof,
or the compliance of any Lender therewith,
(i) subjects any Lender (each reference in this Section 3.1 to a
Lender being in its capacity as a Lender, Alternate Currency Lender, Swing
Line Lender or an Issuing Lender, or all of the foregoing) or any
applicable Lending Installation to any tax, duty, charge or withholding on
or from payments due from either of the Borrowers (excluding taxation
imposed by the United States of America or any Governmental Authority of
the jurisdiction under the laws of which such Lender is organized, on the
overall net income of any Lender or applicable Lending Installation), or
changes the basis of taxation of payments to any Lender in respect of its
Loans, its L/C Interests, the Letters of Credit or other amounts due it
hereunder, provided however that this clause (i) shall not apply with
respect to any Taxes to which Section 2.14(E) applies, or
(ii) imposes or increases or deems applicable any reserve, assessment,
insurance charge, special deposit or similar requirement against assets
of, deposits with or for the account of, or credit extended by, any Lender
or any applicable Lending Installation with respect to its Eurocurrency
Rate Loans, Alternate Currency Loans, L/C Interests or the Letters of
Credit (other than reserves and assessments taken into account in
calculating the Eurocurrency Rate), or
(iii) imposes any other condition the result of which is to increase
the cost to any Lender or any applicable Lending Installation of making,
funding or maintaining the Eurocurrency Rate Loans, Alternate Currency
Loans, the L/C Interests or the Letters of
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Credit or reduces any amount received by any Lender or any applicable
Lending Installation in connection with Alternate Currency Loans,
Eurocurrency Rate Loans or Letters of Credit, or requires any Lender or any
applicable Lending Installation to make any payment calculated by reference
to the amount of Loans or L/C Interests held or interest received by it or
by reference to the Letters of Credit, by an amount deemed material by such
Lender;
and the result of any of the foregoing is to increase the cost to that Lender
of making, renewing or maintaining its Loans, L/C Interests or Letters of Credit
or to reduce any amount received under this Agreement, then, within 15 days
after receipt by Brightpoint of written demand by such Lender pursuant to
Section 3.5, Brightpoint shall pay or cause the appropriate Subsidiary to pay
such Lender that portion of such increased expense incurred or reduction in an
amount received which such Lender determines is attributable to making, funding
and maintaining its Loans, L/C Interests, Letters of Credit and its Revolving
Loan Commitment.
3.2 changes in Capital Adequacy Regulations. If a Lender (each reference in
this Section 3.2 to a Lender being in its capacity as a Lender, Alternate
Currency Lender, Swing Line Lender or an Issuing Lender, or all of the
foregoing) determines (i) the amount of capital required or expected to be
maintained by such Lender, any Lending Installation of such Lender or any
corporation controlling such Lender is increased as a result of a "Change" (as
defined below), and (ii) such increase in capital will result in an increase in
the cost to such Lender of maintaining its Loans, L/C Interests, the Letters of
Credit or its obligation to make Loans hereunder, then, within 15 days after
receipt by Brightpoint of written demand by such Lender pursuant to Section 3.5,
Brightpoint shall pay or cause the appropriate Subsidiary to pay such Lender the
amount necessary to compensate for any shortfall in the rate of return on the
portion of such increased capital which such Lender determines is attributable
to this Agreement, its Loans, its L/C Interests, the Letters of Credit or its
obligation to make Loans hereunder (after taking into account such Lender's
policies as to capital adequacy). "Change" means (i) any change after the date
of this Agreement in the "Risk-Based Capital Guidelines" (as defined below)
excluding, for the avoidance of doubt, the effect of any phasing in of such
Risk-Based Capital Guidelines or any other capital requirements passed prior to
the date hereof, or (ii) any adoption of or change in any other law,
governmental or quasi-governmental rule, regulation, policy, guideline,
interpretation, or directive (whether or not having the force of law) after the
date of this Agreement and having general applicability to all banks and
financial institutions within the jurisdiction in which such Lender operates
which affects the amount of capital required or expected to be maintained by any
Lender or any Lending Installation or any corporation controlling any Lender.
"Risk-Based Capital Guidelines" means (i) the risk-based capital guidelines in
effect in the United States on the date of this Agreement, including transition
rules, and (ii) the corresponding capital regulations promulgated by regulatory
authorities outside the United States implementing the July 1988 report of the
Basle Committee on Banking Regulation and Supervisory Practices Entitled
"International Convergence of Capital
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Measurements and Capital Standards," including transition rules, and any
amendments to such regulations adopted prior to the date of this Agreement.
3.3 Availability of Types of Advances. If (i) any Lender determines that
maintenance of its Eurocurrency Rate Loans or Alternate Currency Credits at a
suitable Lending Installation would violate any applicable law, rule, regulation
or directive, whether or not having the force of law, or (ii) the Required
Lenders determine that (x) deposits of a type, currency and maturity appropriate
to match fund Fixed Rate Advances are not available or (y) the interest rate
applicable to a Eurocurrency Rate Advance does not accurately reflect the cost
of making or maintaining such a Eurocurrency Rate Advance, then the
Administrative Agent or Alternate Currency Lender, as the case may be, shall
suspend the availability of Eurocurrency Rate Advances or Alternate Currency
Credits and, in the case of any occurrence set forth in clause (i), require any
Eurocurrency Rate Advances to be repaid or, at the option of Brightpoint,
converted to Base Rate Advances.
3.4 Funding Indemnification. If (i) any payment of a Fixed Rate Loan or
other Alternate Currency Loan occurs on a date which is not the last day of the
applicable Interest Period or any Loan in any currency is converted to a Loan in
any other currency on a date which is not the last day of the applicable
Interest Period, whether because of acceleration, prepayment, or otherwise, or
(ii) a Fixed Rate Loan or other Alternate Currency Loan is not made or continued
on the date specified by the applicable Borrower for any reason other than
default by the Lenders, the applicable Borrower agrees to compensate and
indemnify each Lender, on demand, for any loss or cost incurred by it resulting
therefrom, including, without limitation, any loss or cost in liquidating or
employing deposits acquired to fund or maintain the Fixed Rate Advance.
3.5 Lender Statements; Survival of Indemnity. If reasonably possible, each
Lender shall designate an Alternate Lending Installation with respect to its
Fixed Rate Loans to reduce any liability of Brightpoint or BPI to such Lender
under Sections 3.1 and 3.2 or to avoid the unavailability of a Type of Advance
under Section 3.3, so long as such designation is not disadvantageous to such
Lender. Each Lender requiring compensation pursuant to Section 2.14(E) or to
this Article III shall use its reasonable efforts to notify Brightpoint and the
Administrative Agent in writing of any Change, law, policy, rule, guideline or
directive giving rise to such demand for compensation not later than ninety (90)
days following the date upon which the responsible account officer of such
Lender knows or should have known of such Change, law, policy, rule, guideline
or directive; provided, that failure to give such notice shall not affect any
obligations of the Borrowers hereunder with respect thereto. Any demand for
compensation pursuant to this Article III shall be in writing and shall state
the amount due, if any, under Section 3.1, 3.2 or 3.4 and shall set forth in
reasonable detail the calculations upon which such Lender determined such
amount. Such written demand shall be rebuttably presumed correct for all
purposes. Determination of amounts payable under such Sections in connection
with a Fixed Rate Loan shall be calculated as though each Lender funded its
Fixed Rate Loan through the purchase of a deposit of the type, currency and
maturity corresponding to the deposit
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used as a reference in determining the Fixed Rate applicable to such Loan,
whether in fact that is the case or not. The obligations of the Borrowers under
Sections 3.1, 3.2 and 3.4 shall survive payment of the Obligations and
termination of this Agreement.
ARTICLE IV: CONDITIONS PRECEDENT
4.1 Initial Advances and Letters of Credit. The Lenders shall not be
required to make the initial Loans or issue any Letters of Credit unless:
(a) all "Alternate Currency Loans" (as defined in the Original Credit
Agreement), together with interest and any amounts payable under Section
3.4 of the Original Credit Agreement in connection therewith have been
repaid;
(b) the Borrowers have furnished to the Administrative Agent, with
sufficient copies for the Lenders, such documents as the Administrative
Agent or any Lender or its counsel may have reasonably requested,
including, without limitation, corporate documentation and opinions of
counsel; and
(c) Brightpoint shall have paid to the Administrative Agent, for the
account of the Lenders in accordance with their Pro Rata Shares, a fee in
an amount equal to 2.5 basis points of the Aggregate Commitment and such
other Closing fees as made be agreed to between the Borrowers and the
Administrative Agent or Arranger.
4.2 Each Advance and Letter of Credit. Except as expressly provided in
Sections 2.2, 2.4 and 2.22 with respect to the purchase of Loans, participations
in Loans or making of Loans to repay Swing Line Loans, the Lenders shall not be
required to make any Advance and the Issuing Lender shall not be required to
issue any Letter of Credit, unless on the applicable Borrowing Date, or in the
case of a Letter of Credit, the date on which the Letter of Credit is to be
issued:
(i) There exists no Default or Unmatured Default; and
(ii) The representations and warranties contained in Article V are
true and correct in all material respects as of such Borrowing Date, except
for representations and warranties made with reference to a specific date
which representations and warranties shall be true and correct in all
material respects as of such date, and except for amendments to the
Schedules made pursuant to the provisions of Section 1.3.
Each Borrowing Notice with respect to each such Advance and the letter of
credit application with respect to a Letter of Credit shall constitute a
representation and warranty by the Borrowers that the conditions contained in
Sections 4.2(i) and (ii) will have been satisfied as of
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the date of such Advance or the issuance of such Letter of Credit. Any Lender
may require a duly completed officer's certificate in substantially the form of
Exhibit H hereto and/or a duly completed compliance certificate in substantially
the form of Exhibit A hereto as a condition to making an Advance; provided,
however, no such officer's certificate or compliance certificate shall be
required without at least 3 Business Days' prior notice unless the Lender
requesting such certificate has a good faith basis for believing that the
conditions contained in Section 4.2(i) and (ii) cannot be met in connection with
any such borrowing.
4.3 Conditions Precedent to Initial Borrowing by each Subsidiary Borrower.
The obligation of the Alternate Currency Lender to make an Alternate Currency
Credit on the occasion of the first borrowing by each Subsidiary Borrower is
subject to the satisfaction of the condition that the Administrative Agent shall
have received the following:
(a) an Alternate Currency Addendum for such Subsidiary Borrower duly
executed by the Alternate Currency Lenders and the applicable Subsidiary
Borrower and acknowledged by Brightpoint;
(b) any other Alternate Currency Documents reasonably requested by the
Administrative Agent with respect to such proposed Alternate Currency Credits;
(c) all other documents as shall reasonably demonstrate the existence of
such Subsidiary Borrower, the corporate power and authority of such Subsidiary
Borrower to enter into the applicable Alternate Currency Documents, to borrow
the applicable Alternate Currency Loans and the validity of the foregoing.
ARTICLE V: REPRESENTATIONS AND WARRANTIES
In order to induce the Agents and the Lenders to enter into this Agreement
and to make the Loans and the other financial accommodations to the Borrowers
and in order to induce the Issuing Lender to issue the Letters of Credit
described herein, each of the Borrowers represents and warrants as follows to
each Lender and each Agent as of the Closing Date and thereafter on each date as
required by Section 4.2:
5.1 Organization: Powers. Each of the Borrowers and each of their respective
Subsidiaries (i) is a duly organized corporation validly existing and in good
standing under the laws of the jurisdiction of its organization, (ii) is duly
qualified to do business as a foreign company or corporation and is in good
standing under the laws of each jurisdiction in which failure to be so qualified
and in good standing could have a Material Adverse Effect, and (iii) has all
requisite power and authority to own, operate and encumber its property and to
conduct its business as presently conducted and as proposed to be conducted in
connection with and following the consummation of the transactions contemplated
by this Agreement.
5.2 Authority.
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(A) Each of the Borrowers and each of their respective Subsidiaries has the
requisite power and authority (i) to execute, deliver and perform each of the
Loan Documents which have been executed by it as required by this Agreement and
(ii) to file the Loan Documents which must be filed by it with any Governmental
Authority.
(B) The execution, delivery, performance and filing, as the case may be, of
each of the Loan Documents which must be executed or filed by either of the
Borrowers or any other Subsidiary of Brightpoint which have been executed or
filed as required by this Agreement and to which either of the Borrowers or any
other Subsidiary of Brightpoint is party, and the consummation of the
transactions contemplated thereby, have been duly approved, to the extent
required, by the respective boards of managers or directors, as applicable, and,
if necessary, the members or shareholders or workers' councils of any Borrower
or Subsidiary, as applicable, and such approvals have not been rescinded. No
other action or proceedings on the part of any Borrower or any other Person are
necessary to consummate such transactions.
(C) Each of the Loan Documents to which either of the Borrowers or any
other Subsidiary of Brightpoint is a party has been duly executed, delivered or
filed, as the case may be, by it and constitutes its legal, valid and binding
obligation, enforceable against it in accordance with its terms (except as
enforceability may be limited by bankruptcy, insolvency, or similar laws
affecting the enforcement of creditor's rights generally), is in full force and
effect and no material term or condition thereof has been amended, modified or
waived from the terms and conditions contained in the Loan Documents delivered
to the Administrative Agent pursuant to Section 4.1 without the prior written
consent of the Required Lenders, and each of the Borrowers or each other
Subsidiary of Brightpoint have, and, to the best of such Borrower's or
Subsidiary's knowledge, all other parties thereto have performed and complied
with all the terms, provisions, agreements and conditions set forth therein and
required to be performed or complied with by such parties, and no unmatured
default, default or breach of any covenant by any such party exists thereunder.
5.3 No Conflict; Governmental Consents. The execution, delivery and
performance of each of the Loan Documents to which either of the Borrowers or
any other Subsidiary of Brightpoint is a party do not and will not (i) conflict
with the documents of organization or governance of such Borrower or Subsidiary
(ii) constitute tortious interference with any Contractual Obligation of any
Person or conflict with, result in a breach of or constitute (with or without
notice or lapse of time or both) a default under any Requirement of Law
(including, without limitation, any Environmental Property Transfer Act) or
Contractual Obligation of any Borrower or any such Subsidiary, or require
termination of any Contractual Obligation, except such interference, breach,
default or termination which individually or in the aggregate would not
reasonably be expected to have a Material Adverse Effect or to subject the
Agents, the Arranger, any of the Lenders or the Issuing Lender to any liability,
(iii) with respect to the Loan Documents, result in or require the creation or
imposition of any Lien whatsoever upon any of
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the property or assets of any Borrower or any such Subsidiary, other than Liens
permitted by the Loan Documents, or (iv) require any approval of the Borrower's
or any such Subsidiary's members, shareholders, workers' council or other
similar constituent group except such as have been obtained. The execution,
delivery and performance of each of the Loan Documents to which any Borrower or
any other Subsidiary is a party do not and will not require any registration
with, consent or approval of, or notice to, or other action to, with or by any
Governmental Authority, including under any Environmental Property Transfer Act.
5.4 Financial Statements. The historical and forecasted financial
statements (the "Statements") of Brightpoint and its Subsidiaries, copies of
which are attached hereto as Schedule 5.4, (i) with respect to the historical
Statements, (a) were prepared in accordance with generally accepted accounting
principles consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein, (b) fairly present the consolidated financial
position of Brightpoint and its Subsidiaries as of the date thereof and
consolidated results of operations for the period covered thereby; and (c) show
all material indebtedness and other liabilities, direct or contingent, of
Brightpoint and its consolidated Subsidiaries as of the date thereof, including
liabilities for taxes, material commitments and Contingent Obligations; and (ii)
with respect to the forecasted Statements, the projections and assumptions
expressed therein were prepared in good faith and represent management's opinion
based on the information available to Brightpoint at the time so furnished.
5.5 No Material Adverse Change. (a) Since June 24, 1997 up to the Closing
Date, there has occurred no change in the business, properties, condition
(financial or otherwise) or results of operations of Brightpoint and its
Subsidiaries taken as a whole or any other event which has had or is reasonably
likely to have a Material Adverse Effect.
(b) Since the Closing Date, there has occurred no change in the business,
properties, condition (financial or otherwise) or results of operations of
Brightpoint and its Subsidiaries taken as a whole or any other event which has
had or is reasonably likely to have a Material Adverse Effect.
5.6 Taxes.
(A) Tax Examination. All deficiencies which have been asserted against
Brightpoint or any of Brightpoint's Subsidiaries as a result of any federal,
state, local or foreign tax examination for each taxable year in respect of
which an examination has been conducted have been fully paid or finally settled
or are being contested in good faith, and as of the Closing Date no issue has
been raised by any taxing authority in any such examination which, by
application of similar principles, reasonably can be expected to result in
assertion by such taxing authority of a material deficiency for any other year
not so examined which has not been reserved for in Brightpoint's consolidated
financial statements to the extent, if any, required by Agreement Accounting
Principles. Except as permitted pursuant to Section 6.2(D), neither Brightpoint
nor any of
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Brightpoint's Subsidiaries anticipates any material tax liability with respect
to the years which have not been closed pursuant to applicable law.
(B) Payment of Taxes. All tax returns and reports of each of Brightpoint,
BPI and Brightpoint's other Subsidiaries required to be filed have been timely
filed, and all taxes, assessments, fees and other governmental charges thereupon
and upon their respective property, assets, income and franchises which are
shown in such returns or reports to be due and payable have been paid except
those items which are being contested in good faith and have been reserved for
in accordance with Agreement Accounting Principles. Brightpoint has no knowledge
of any proposed tax assessment against Brightpoint, BPI, or any of Brightpoint's
other Subsidiaries that will have or is reasonably likely to have a Material
Adverse Effect.
5.7 Litigation; Loss Contingencies and Violations. Except for Permitted
Existing Contingent Obligations and as set forth in Schedules 5.7 to this
Agreement, there is no action, suit, proceeding, investigation of which
Brightpoint has knowledge or arbitration before or by any Governmental Authority
or private arbitrator pending or, to the knowledge of Brightpoint or any of its
Subsidiaries, threatened against Brightpoint or any of its Subsidiaries or any
property of any of them (i) challenging the validity or the enforceability of
any material provision of the Loan Documents or (ii) which will have or is
reasonably likely to have a Material Adverse Effect. There is no material loss
contingency within the meaning of Agreement Accounting Principles which has not
been reflected in the consolidated financial statements of Brightpoint prepared
and delivered pursuant to Section 6.1(A) for the fiscal period during which such
material loss contingency was incurred. Neither Brightpoint nor any of its
Subsidiaries is (A) in violation of any applicable Requirements of Law which
violation will have or is reasonably likely to have a Material Adverse Effect,
or (B) subject to or in default with respect to any final judgment, writ,
injunction, restraining order or order of any nature, decree, rule or regulation
of any court or Governmental Authority which will have or is reasonably likely
to have a Material Adverse Effect.
5.8 Subsidiaries. Schedule 5.8 to this Agreement (i) contains a description
(both narratively and in flow chart form) of the corporate structure of
Brightpoint, Brightpoint's Subsidiaries and any other Person in which
Brightpoint or any of its Subsidiaries holds an equity interest; and (ii)
accurately sets forth (A) the correct legal name, the jurisdiction of
organization or incorporation and the jurisdictions in which each Borrower and
the direct and indirect Subsidiaries of Brightpoint is qualified to transact
business as a foreign company or corporation, (B) the authorized, issued and
outstanding shares of each class of Capital Stock of each entity referred to
above that is a corporation and the owners of such shares (both as of the
Closing Date and on a fully-diluted basis), and (C) a summary of the direct and
indirect ownership, membership, partnership, joint venture, or other equity
interests, if any, of Brightpoint and each Subsidiary of Brightpoint in any
Person that is not a corporation.
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5.9 ERISA No Benefit Plan has incurred any accumulated funding deficiency
(as defined in Sections 302(a)(2) of ERISA and 412(a) of the Code) whether or
not waived. Neither Brightpoint nor any member of the Controlled Group has
incurred any liability to the PBGC which remains outstanding other than the
payment of premiums, and there are no premium payments which have become due
which are unpaid. Schedule B to the most recent annual report filed with the IRS
with respect to each Benefit Plan and furnished to the lenders is complete and
accurate. Since the date of each such Schedule B, there has been no material
adverse change in the funding status or financial condition of the Benefit Plan
relating to such Schedule B. Neither Brightpoint nor any member of the
Controlled Group has (i) failed to make a required contribution or payment to a
Multiemployer Plan or (ii) made a complete or partial withdrawal under Sections
4203 or 4205 of ERISA from a Multiemployer Plan. Neither Brightpoint nor any
member of the Controlled Group has failed to make a required installment or any
other required payment under Section 412 of the Code on or before the due date
for such installment or other payment. Neither Brightpoint nor any member of the
Controlled Group is required to provide security to a Benefit Plan under Section
401(a)(29) of the Code due to a Plan amendment that results in an increase in
current liability for the plan year. Neither Brightpoint nor any of its
Subsidiaries maintains or contributes to any employee welfare benefit plan
within the meaning of Section 3(1) of ERISA which provides benefits to employees
after termination of employment other than as required by Section 601 of ERISA.
Each Plan which is intended to be qualified under Section 401(a) of the Code as
currently in effect is so qualified, and each trust related to any such Plan is
exempt from federal income tax under Section 501(a) of the Code as currently in
effect. Brightpoint and all Subsidiaries are in compliance in all material
respects with the responsibilities, obligations and duties imposed on them by
ERISA and the Code with respect to all Plans. Neither Brightpoint nor any of its
Subsidiaries nor any fiduciary of any Plan has engaged in a nonexempt prohibited
transaction described in Sections 406 of ERISA or 4975 of the Code which could
reasonably be expected to subject Brightpoint to liability individually or in
the aggregate in excess of $250,000. Neither Brightpoint nor any member of the
Controlled Group has taken or failed to take any action which would constitute
or result in a Termination Event, which action or inaction could reasonably be
expected to subject Brightpoint nor any of its Subsidiaries to liability in
excess of $250,000. Neither Brightpoint nor any Subsidiary is subject to any
liability under Sections 4063, 4064, 4069, 4204 or 4212(c) of ERISA and no other
member of the Controlled Group is subject to any liability under Sections 4063,
4064, 4069, 4204 or 4212(c) of ERISA which could reasonably be expected to
subject Brightpoint to or any of its Subsidiaries liability individually or in
the aggregate in excess of $250,000. Neither Brightpoint nor any of its
Subsidiaries has, by reason of the transactions contemplated hereby, any
obligation to make any payment to any employee pursuant to any Plan or existing
contract or arrangement.
5.10 Accuracy of Information. The information, exhibits and reports
furnished by or on behalf of Brightpoint and any of its Subsidiaries to the
Administrative Agent or to any Lender in connection with the negotiation of, or
compliance with, the Loan Documents, including, without limitation, the
Confidential Information Memorandum reviewed by Brightpoint (provided that
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except as set forth in Section 5.4, no representation or warranty is made with
respect to the forward looking information contained therein), the
representations and warranties of Brightpoint and its Subsidiaries contained in
the Loan Documents, and all certificates and documents delivered to the
Administrative Agent and the Lenders pursuant to the terms thereof do not
contain as of the date furnished any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
contained herein or therein, in light of the circumstances under which they
were made, not misleading.
5.11 Securities Activities. Neither Brightpoint nor any of its Subsidiaries
is engaged in the business of extending credit for the purpose of purchasing or
carrying Margin Stock.
5.12 Material Agreements. Neither Brightpoint nor any Subsidiary is a party
to any agreement or instrument or subject to any charter or other contractual or
corporate restriction which will have or is reasonably likely to have a Material
Adverse Effect. Neither Brightpoint nor any of its Subsidiaries has received
notice or has knowledge that (i) it is in default in the performance, observance
or fulfillment of any of the obligations, covenants or conditions contained in
any Contractual Obligation applicable to it, or (ii) any condition exists which,
with the giving of notice or the lapse of time or both, would constitute a
default with respect to any such Contractual Obligation, in each case, except
where such default or defaults, if any, will not have or are not reasonably
likely to have a Material Adverse Effect.
5.13 Compliance and Properties. Brightpoint and its Subsidiaries are in
compliance with all Requirements of Law applicable to them and their respective
businesses, in each case where the failure to so comply individually or in the
aggregate will have or is reasonably likely to have a Material Adverse Effect.
5.14 Assets and Properties. Brightpoint and each of its Subsidiaries has
good and marketable title to all of its assets and properties (tangible and
intangible, real or personal) owned by it or a valid leasehold interest in all
of its leased assets (except insofar as marketability may be limited by any laws
or regulations of any Governmental Authority affecting such assets), and all
such assets and property are free and clear of all Liens, except Liens securing
the Obligations and Liens permitted under Section 6.3(C). Substantially all of
the assets and properties owned by, leased to or used by Brightpoint and/or each
such Subsidiary of Brightpoint are in adequate operating condition and repair,
ordinary wear and tear excepted. Except for Liens granted to the Administrative
Agent for the benefit of the Administrative Agent and the Holders of Secured
Obligations, neither this Agreement nor any other Loan Document, nor any
transaction contemplated under any such agreement, will affect any right, title
or interest of Brightpoint or such Subsidiary in and to any of such assets in a
manner that will have or is reasonably likely to have a Material Adverse Effect.
5.15 Statutory Indebtedness Restrictions. Neither Brightpoint, nor any of
its Subsidiaries is subject to regulation under the Public Utility Holding
Company Act of 1935, the Federal
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Power Act, the Interstate Commerce Act, or the Investment Company Act of 1940,
or any other federal, state, local or foreign statute or regulation which limits
its ability to incur indebtedness or its ability to consummate the transactions
contemplated hereby.
5.16 Post-Retirement Benefits. As of the Closing Date, Brightpoint and its
Subsidiaries have no expected cost of post-retirement medical and insurance
benefits payable by Brightpoint or its Subsidiaries to its employees and former
employees, as estimated by Brightpoint in accordance with Financial Accounting
Standards Board Statement No. 106.
5.17 Insurance. Schedule 5.17 to this Agreement accurately sets forth as of
the Closing Date all insurance policies and programs currently in effect with
respect to the respective properties and assets and business of Brightpoint and
its Subsidiaries, specifying for each such policy and program, (i) the amount
thereof, (ii) the risks insured against thereby, (iii) the name of the insurer
and each insured party thereunder, (iv) the policy or other identification
number thereof, (v) the expiration date thereof, (vi) the annual premium with
respect thereto and (vii) describes any reserves, relating to any self-insurance
program that is in effect. Such insurance policies and programs reflect coverage
that is reasonably consistent with prudent industry practice.
5.18 Contingent Obligations. Except for Permitted Existing Contingent
Obligations, neither Brightpoint nor any of its Subsidiaries has any Contingent
Obligation, contingent liability, long-term lease, synthetic lease or
commitment, not reflected in the financial statements attached hereto as Exhibit
I or otherwise disclosed to the Administrative Agent and the Lenders in the
other Schedules to this Agreement, which could reasonably be expected to subject
Brightpoint nor any of its Subsidiaries to liability individually or in the
aggregate in excess of (a) twenty percent (20%) of Total Capital with respect to
Contingent Purchase Price Obligations requiring cash payments or (b) $1,000,000
for other amounts.
5.19 Restricted Junior Payments. Neither Brightpoint nor any of its
Subsidiaries has directly or indirectly declared, ordered, paid or made or set
apart any sum or properties for any Restricted Junior Payment or agreed to do
so, except to the extent permitted pursuant to Section 6.3(F) of this Agreement.
5.20 Labor Matters.
(A) There are on the Closing Date no collective bargaining agreements,
other labor agreements or Multiemployer Plans covering any of the employees of
Brightpoint or any of its Subsidiaries. As of the Closing Date, no labor
disputes, strikes or walkouts affecting the operations of Brightpoint or any of
its Subsidiaries, is pending, or, to Brightpoint's knowledge, threatened,
planned or contemplated.
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(B) Set forth in Schedule 5.20 to this Agreement is a list, as of the
Closing Date, of all material consulting agreements, executive compensation
plans, deferred compensation agreements, employee pension plans or retirement
plans, employee profit sharing plans, employee stock purchase and stock option
plans, severance plans, group life insurance, hospitalization insurance or other
plans or arrangements of Brightpoint and its Subsidiaries providing for benefits
for employees of Brightpoint or its Subsidiaries.
5.21 Environmental Matters. (a) Except as disclosed on Schedule 5.21:
(i) the operations of Brightpoint and its Subsidiaries comply in all
material respects with Environmental, Health or Safety Requirements of Law;
(ii) Brightpoint and its Subsidiaries have all material permits,
licenses or other authorizations required under Environmental, Health or
Safety Requirements of Law and are in material compliance with such permits;
(iii) neither Brightpoint, any of its Subsidiaries nor any of their
respective present property or operations, or, to the best of, Brightpoint's
or any of its Subsidiaries' knowledge, any of their respective past property
or operations, are subject to or the subject of, any investigation known to
Brightpoint or any of its Subsidiaries, any judicial or administrative
proceeding, order, judgment, decree, settlement or other agreement
respecting: (A) any material violation of Environmental, Health or Safety
Requirements of Law; (B) any material remedial action; or (C) any material
claims or liabilities arising from the Release or threatened Release of a
Contaminant into the environment;
(iv) there is not now, nor to the best of Brightpoint's or any of its
Subsidiaries' knowledge has there ever been on or in the property of
Brightpoint or any of its Subsidiaries any material landfill, waste pile,
underground storage tanks, aboveground storage tanks, surface impoundment or
hazardous waste storage facility of any kind, polychlorinated biphenyls
(PCBs) used in hydraulic oils, electric transformers or other equipment, or
asbestos-containing material; and
(v) neither Brightpoint nor any of its Subsidiaries has any material
Contingent Obligation or material contingent liability in connection with
any Release or threatened Release of a Contaminant into the environment.
(b) For purposes of this Section 5.21 "material" means any noncompliance or
basis for liability which could reasonably be likely to subject Brightpoint to
liability individually or in the aggregate in excess of $250,000.
5.22 Foreign Employee Benefit Matters. To the best of Brightpoint's and its
Subsidiaries' knowledge after diligent inquiry of all relevant Persons: (a) each
Foreign Employee
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Benefit Plan is in compliance in all respects with all laws, regulations and
rules applicable thereto and the respective requirements of the governing
documents for such Plan, except for any non-compliance the consequences of
which, in the aggregate, would not result in a material obligation to pay
money; (b) the aggregate of the accumulated benefit obligations under all
Foreign Pension Plans does not exceed the current fair market value of the
assets held in the trusts or similar funding vehicles for such Plans or
reasonable reserves have been established in accordance with prudent business
practices or as required by Agreement Accounting Principles with respect to any
shortfall; (c) with respect to any Foreign Employee Benefit Plan maintained or
contributed to by Brightpoint or any Subsidiary or any member of its Controlled
Group (other than a Foreign Pension Plan), reasonable reserves have been
established in accordance with prudent business practice or where required by
ordinary accounting practices in the jurisdiction in which such Plan is
maintained; and (d) there are no actions, suits or claims (other than routine
claims for benefits) pending or, to the knowledge of Brightpoint and its
Subsidiaries, threatened against Brightpoint or any Subsidiary of it or any
ERISA Affiliate with respect to any Foreign Employee Benefit Plan.
5.23. Year 2000 Issues. Each of the Borrower and its Subsidiaries has made
a full and complete assessment of the Year 2000 Issues and has a realistic and
achievable program for remediating the Year 2000 Issues on a timely basis.
Based on this assessment and program, the Borrower does not reasonably
anticipate any Material Adverse Effect as a result of Year 2000 Issues.
ARTICLE VI: COVENANTS
Each of the Borrowers covenants and agrees that so long as any Commitments
are outstanding and thereafter until payment in full of all of the Obligations
(other than contingent indemnity and reimbursement obligations), unless the
Required Lenders shall otherwise give prior written consent:
6.1 Reporting. The Borrowers shall:
(A) Financial Reporting. Furnish to the Administrative Agent (which will
furnish copies of the following to the Lenders):
(i) Quarterly Reports. As soon as practicable, and in any event within
forty-five (45) days after the end of the first three fiscal quarters in
each fiscal year beginning with the fiscal quarter ending March 31, 1998,
the consolidated and consolidating balance sheets of Brightpoint and its
Subsidiaries as at the end of such period, the related consolidated and
consolidating statements of income and the related consolidated statement
of stockholders' equity and cash flow of Brightpoint and its Subsidiaries
for such fiscal quarter and for the period from the beginning of the then
current fiscal year to the end of such fiscal quarter, certified by the
chief financial officer of Brightpoint on
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behalf of Brightpoint as fairly presenting in all material respects the
consolidated and, as applicable, consolidating financial position of
Brightpoint and its Subsidiaries as at the dates indicated and the results
of their operations and cash flow for the periods indicated in accordance
with Agreement Accounting Principles, subject to normal year end
adjustments.
(ii) Annual Reports. As soon as practicable, and in any event within
one hundred twenty (120) days after the end of each fiscal year, (a) the
consolidated and consolidating balance sheet of Brightpoint and its
Subsidiaries as at the end of such fiscal year and the related
consolidated and consolidating statements of income and the related
consolidated statement of stockholders' equity and cash flow of
Brightpoint and its Subsidiaries for such fiscal year, and, in comparative
form the corresponding figures for the previous fiscal year, (b) a
schedule from Brightpoint setting forth for each item in clause (a)
hereof, the corresponding figures from the consolidated financial budget
for the current fiscal year delivered pursuant to Section 6.1(A)(iv), and
(c) an audit report on the items (other than the consolidating financial
statements) listed in clause (a) hereof of independent certified public
accountants of recognized national standing, which audit report shall be
unqualified and shall state that such financial statements fairly present
in all material respects the consolidated financial position of
Brightpoint and its Subsidiaries as at the dates indicated and the results
of their operations and cash flow for the periods indicated in conformity
with Agreement Accounting Principles and that the examination by such
accountants in connection with such consolidated financial statements has
been made in accordance with generally accepted auditing standards. The
deliveries made pursuant to this clause (ii) shall be accompanied by (y)
the report on internal controls prepared by the above-referenced
accountants and (z) a certificate of such accountants that, in the course
of their examination necessary for their certification of the foregoing
(such examination utilizing only their customary audit procedures without
any necessity of conducting extra procedures for purposes of this
certificates), they have obtained no knowledge of any Default or Unmatured
Default, or if, in the opinion of such accountants, any Default or
Unmatured Default shall exist, stating the nature and status thereof.
(iii) Officer's Certificate. Together with each delivery of any
financial statement pursuant to clauses (i) and (ii) of this Section
6.1(A), (a) an Officer's Certificate of Brightpoint, substantially in the
form of Exhibit H attached hereto and made a part hereof, stating that no
Default or Unmatured Default exists, or if any Default or Unmatured
Default exists, stating the nature and status thereof and (b) a Compliance
Certificate, substantially in the form of Exhibit A attached hereto and
made a part hereof, signed by Brightpoint's chief financial officer or
treasurer, setting forth Brightpoint's calculations for the period then
ended for Section 2.5(B) and for Section 2.8(b) and which demonstrate
compliance, when applicable, with the provisions of Section 6.4.
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(iv) Budgets. As soon as practicable and in any event not later than
thirty (30) days following the beginning of each fiscal year beginning
with the fiscal year beginning January 1, 1999, a copy of the budget
(including a budgeted balance sheet and income statement) of Brightpoint
for the upcoming fiscal year prepared in such detail as shall be
reasonably satisfactory to the Administrative Agent.
(B) Notice of Default. Promptly upon any of the chief executive officer,
chief operating officer, chief financial officer, treasurer or controller of
Brightpoint or BPI obtaining knowledge (i) of any condition or event which
constitutes a Default or Unmatured Default, or becoming aware that any Lender
or Administrative Agent has given any written notice with respect to a claimed
Default or Unmatured Default under this Agreement, or (ii) that any Person has
given any written notice to Brightpoint or any Subsidiary of Brightpoint or
taken any other action with respect to a claimed default or event or condition
of the type referred to in Section 7.1(e), deliver to the Administrative Agent
and the Lenders an Officer's Certificate specifying (a) the nature and period
of existence of any such claimed default, Default, Unmatured Default, condition
or event, (b) the notice given or action taken by such Person in connection
therewith, and (c) what action Brightpoint has taken, is taking and proposes to
take with respect thereto.
(C) Lawsuits. (i) Promptly upon Brightpoint obtaining knowledge of the
institution of, or written threat of, any action, suit, proceeding,
governmental investigation or arbitration against or affecting Brightpoint or
any of its Subsidiaries or any property of Brightpoint or any of its
Subsidiaries not previously disclosed pursuant to Section 5.7, which action,
suit, proceeding, governmental investigation or arbitration exposes, or in the
case of multiple actions, suits, proceedings, governmental investigations or
arbitrations arising out of the same general allegations or circumstances which
expose, in Brightpoint's reasonable judgment, Brightpoint or any of its
Subsidiaries to liability in an amount aggregating $1,000,000 or more, give
written notice thereof to the Administrative Agent on behalf of the Lenders and
provide such other information as may be reasonably available to enable each
Lender and the Administrative Agent and its counsel to evaluate such matters;
and (ii) in addition to the requirements set forth in clause (i) of this
Section 6.1(C), upon request of the Administrative Agent or the Required
Lenders, promptly give written notice of the status of any action, suit,
proceeding, governmental investigation or arbitration disclosed on Schedule 5.7
or covered by a report delivered pursuant to clause (i) above and provide such
other information as may be reasonably available to it that would not result in
loss of any attorney-client privilege by disclosure to the Lenders to enable
each Lender and the Administrative Agent and its counsel to evaluate such
matters.
(D) Insurance. As soon as practicable and in any event within one hundred
twenty (120) days of the end of each fiscal year commencing with fiscal year
ending December 31, 1997, deliver to the Administrative Agent and the Lenders
(i) a report in form and substance reasonably satisfactory to the
Administrative Agent and the Lenders outlining all material insurance coverage
maintained as of the date of such report by Brightpoint and its Subsidiaries
and the
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duration of such coverage and (ii) an insurance broker's statement that all
premiums with respect to such coverage have been paid when due.
(E) ERISA Notices. Deliver or cause to be delivered to the Administrative
Agent and the Lenders, at Brightpoint's expense, the following information and
notices as soon as reasonably possible, and in any event:
(i) (a) within ten (10) Business Days after any Borrower obtains
knowledge that a Termination Event has occurred, a written statement of
the chief financial officer of Brightpoint describing such Termination
Event and the action, if any, which Brightpoint has taken, is taking or
proposes to take with respect thereto, and when known, any action taken or
threatened by the IRS, DOL or PBGC with respect thereto and (b) within ten
(10) Business Days after any member of the Controlled Group obtains
knowledge that a Termination Event has occurred which could reasonably be
expected to subject Brightpoint to or any of its Subsidiaries liability
individually or in the aggregate in excess of $100,000, a written
statement of the chief financial officer of Brightpoint describing such
Termination Event and the action, if any, which the member of the
Controlled Group has taken, is taking or proposes to take with respect
thereto, and when known, any action taken or threatened by the IRS, DOL or
PBGC with respect thereto;
(ii) within ten (10) Business Days after Brightpoint or any of its
Subsidiaries obtains knowledge that a prohibited transaction (defined in
Sections 406 of ERISA and Section 4975 of the Code) has occurred, a
statement of the chief financial officer of Brightpoint describing such
transaction and the action which Brightpoint or such Subsidiary has taken,
is taking or proposes to take with respect thereto;
(iii) within ten (10) Business Days after any material increase in the
benefits of any existing Plan or the establishment of any new Benefit Plan
or the commencement of, or obligation to commence, contributions to any
Benefit Plan or Multiemployer Plan to which Brightpoint or any member of
the Controlled Group was not previously contributing, notification of such
increase, establishment, commencement or obligation to commence and the
amount of such contributions;
(iv) within ten (10) Business Days after Brightpoint or any of its
Subsidiaries receives notice of any unfavorable determination letter from
the IRS regarding the qualification of a Plan under Section 401(a) of the
Code, copies of each such letter;
(v) within thirty (30) Business Days after the establishment of any
Foreign Employee Benefit Plan or the commencement of, or obligation to
commence, contributions to any Foreign Employee Benefit Plan to which
Brightpoint or any Subsidiary was not previously contributing,
notification of such establishment, commencement or obligation to commence
and the amount of such contributions;
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(vi) within ten (10) Business Days after the filing thereof with the
IRS, a copy of each funding waiver request filed with respect to any
Benefit Plan and all communications received by Brightpoint or a member of
the Controlled Group with respect to such request;
(vii) within ten (10) Business Days after receipt by Brightpoint or
any member of the Controlled Group of the PBGC's intention to terminate a
Benefit Plan or to have a trustee appointed to administer a Benefit Plan,
copies of each such notice;
(viii) within ten (10) Business Days after receipt by Brightpoint or
any member of the Controlled Group of a notice from a Multiemployer Plan
regarding the imposition of withdrawal liability, copies of each such
notice;
(ix) within ten (10) Business Days after Brightpoint or any member of
the Controlled Group fails to make a required installment or any other
required payment under Section 412 of the Internal Revenue Code on or
before the due date for such installment or payment, a notification of
such failure; and
(x) within ten (10) Business Days after Brightpoint or any member of
the Controlled Group knows or has reason to know that (a) a Multiemployer
Plan has been terminated, (b) the administrator or plan sponsor of a
Multiemployer Plan intends to terminate a Multiemployer Plan, or (c) the
PBGC has instituted or will institute proceedings under Section 4042 of
ERISA to terminate a Multiemployer Plan.
For purposes of this Section 6.1(E), Brightpoint, any of its Subsidiaries and
any member of the Controlled Group shall be deemed to know all facts known by
the Administrator of any Plan of which the Borrower or any member of the
Controlled Group or such Subsidiary is the plan sponsor.
(F) Labor Matters. Notify the Administrative Agent and the Lenders in
writing, promptly upon Brightpoint's or any of its Subsidiaries' learning
thereof, of (i) any labor dispute to which Brightpoint or any of its
Subsidiaries may become a party, including, without limitation, any strikes,
lockouts or other disputes relating to such Persons' plants and other facilities
and (ii) any Worker Adjustment and Retraining Notification Act liability
incurred with respect to the Closing of any plant or other facility of
Brightpoint or any of its Subsidiaries where, in the case of (i) or (ii), such
is reasonably likely to have a Material Adverse Effect.
(G) Other Indebtedness. Deliver to the Administrative Agent (i) a copy of
each regular report, notice or communication regarding potential or actual
defaults (including any accompanying officers' certificate) delivered by or on
behalf of Brightpoint or any of its Subsidiaries to the holders of Indebtedness
for money borrowed with respect to Indebtedness the outstanding principal
balance of which is at least $1,000,000 pursuant to the terms of the
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agreements governing such Indebtedness, such delivery to be made at the same
time and by the same means as such notice or other communication is delivered to
such holders, and (ii) a copy of each notice or other communication received by
Brightpoint or any of its Subsidiaries from the holders of Indebtedness for
money borrowed with respect to Indebtedness the outstanding principal balance of
which is at least $1,000,000 pursuant to the terms of such Indebtedness, such
delivery to be made promptly after such notice or other communication is
received by Brightpoint or the applicable Subsidiary.
(H) Other Reports. Deliver or cause to be delivered to the Administrative
Agent and the Lenders copies of all 10-Ks, 10-Qs and 8-Ks filed with the
Commission by Brightpoint, and all notifications received from the Commission by
Brightpoint or its Subsidiaries pursuant to the Securities Exchange Act and the
rules promulgated thereunder.
(I) Environmental Notices. As soon as possible and in any event within ten
(10) days after receipt by Brightpoint or any of its Subsidiaries, a copy of (i)
any notice or claim to the effect that Brightpoint or any of its Subsidiaries is
or may be liable to any Person as a result of the Release by Brightpoint, any of
its Subsidiaries, or any other Person of any Contaminant into the environment,
and (ii) any notice alleging any violation of any Environmental, Health or
Safety Requirements of Law by Brightpoint or any of its Subsidiaries if, in
either case, such notice or claim relates to an event which could reasonably be
expected to subject Brightpoint or any of its Subsidiaries to liability
individually or in the aggregate in excess of $250,000.
(J) Other Information. Within a reasonable period of time following receipt
of a request therefor from the Administrative Agent, prepare and deliver to the
Administrative Agent and the Lenders such other information with respect to
Brightpoint, any of its Subsidiaries, or the Collateral, including, without
limitation, schedules identifying and describing the Collateral and any
dispositions thereof, as from time to time may be reasonably requested by the
Administrative Agent.
6.2 Affirmative Covenants.
(A) Existence, Etc. Brightpoint shall, and shall cause each of its
Subsidiaries to, at all times maintain its existence and preserve and keep, or
cause to be preserved and kept, in full force and effect its rights and
franchises material to its businesses except that any Subsidiary of Brightpoint
may merge with or liquidate into Brightpoint or any other Subsidiary of
Brightpoint, provided that the surviving entity expressly assumes any
liabilities, if any, of either of such Subsidiaries with respect to the
Obligations pursuant to an assumption agreement reasonably satisfactory to the
Administrative Agent; provided further that the consolidated net worth of the
surviving corporation is not less than the consolidated net worth of the
Subsidiary with any liability with respect to the Obligations immediately prior
to such merger; and provided further, if the corporation being merged out of
existence or liquidated is a party to a Pledge Agreement or an Alternate
Currency Addendum (or the Capital Stock of which is the subject of a Pledge
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Agreement), the surviving entity shall execute and deliver such documents,
instruments, agreements and opinions in connection therewith as shall be
required by the Administrative Agent in connection with any such Pledge
Agreement and the Alternate Currency Credits (and all accrued interest in
connection therewith) of such entity shall be repaid in full as of the date of
such liquidation or merger.
(B) Powers. Brightpoint shall, and shall cause each of its Subsidiaries to
qualify and remain qualified to do business in each jurisdiction in which the
nature of its business requires it to be so qualified and where the failure to
be so qualified will have or is reasonably likely to have a Material Adverse
Effect.
(C) Compliance with Laws, Etc. Brightpoint shall, and shall cause its
Subsidiaries to, (a) comply with all Requirements of Law and all restrictive
covenants affecting such Person or the business, properties, assets or
operations of such Person, and (b) obtain as needed all Permits necessary for
its operations and maintain such Permits in good standing unless failure to
comply or obtain could not reasonably be anticipated to have a Material Adverse
Effect.
(D) Payment of Taxes and Claims; Tax Consolidation. Brightpoint shall pay,
and cause each of its Subsidiaries to pay, (i) all taxes, assessments and other
governmental charges imposed upon it or on any of its properties or assets or in
respect of any of its franchises, business, income or property before any
penalty or interest accrues thereon, and (ii) all claims (including, without
limitation, claims for labor, services, materials and supplies) for sums which
have become due and payable and which by law have or may become a Lien (other
than a Lien permitted by Section 6.3(C)) upon any of Brightpoint's or such
Subsidiary's property or assets, prior to the time when any penalty or fine
shall be incurred with respect thereto; provided, however, that no such taxes,
assessments and governmental charges referred to in clause (i) above or claims
referred to in clause (ii) above (and interest, penalties or fines relating
thereto) need be paid if being contested in good faith by appropriate
proceedings diligently instituted and conducted and if such reserve or other
appropriate provision, if any, as shall be required in conformity with Agreement
Accounting Principles shall have been made therefor. Brightpoint will not permit
any of its Subsidiaries to file or consent to the filing of any consolidated
income tax return with any Person other than Brightpoint or any of its
Subsidiaries.
(E) Insurance. Brightpoint shall maintain for itself and its Subsidiaries,
or shall cause each of its Subsidiaries to maintain in full force and effect the
insurance policies and programs listed on Schedule 5.17 to this Agreement or
substantially similar policies and programs or other policies and programs as
reflect coverage that is reasonably consistent with prudent industry practice.
Brightpoint shall deliver to the Administrative Agent endorsements (y) to all
"All Risk" physical damage insurance policies on all of Brightpoint's and BPI's
domestic tangible real and personal property and assets and business
interruption insurance policies naming the Administrative Agent loss payee, and
(z) to all general liability and other liability policies naming the
Administrative Agent an additional insured. In the event Brightpoint, at any
time or
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times hereafter shall fail to obtain or maintain any of the policies or
insurance required herein or to pay any premium in whole or in part relating
thereto, then the Administrative Agent, without waiving or releasing any
obligations or resulting Default hereunder, may at any time or times thereafter
(but shall be under no obligation to do so) obtain and maintain such policies of
insurance and pay such premiums and take any other action with respect thereto
which the Administrative Agent deems advisable. All sums so disbursed by the
Administrative Agent shall constitute part of the Obligations, payable as
provided in this Agreement.
(F) Inspection of Property; Books and Records; Discussions. Brightpoint
shall permit, and cause each of Brightpoint's Subsidiaries to permit, any
authorized representative(s) designated by either the Administrative Agent,
Alternate Currency Lender or any other Lender to visit and inspect any of the
properties of Brightpoint or any of its Subsidiaries, to examine, audit, check
and make copies of their respective financial and accounting records, books,
journals, orders, receipts and any non-privileged correspondence and other data
relating to their respective businesses or the transactions contemplated hereby
(including, without limitation, in connection with environmental compliance,
hazard or liability), and to discuss their affairs, finances and accounts with
their officers and independent certified public accountants, all upon reasonable
notice and at such reasonable times during normal business hours, as often as
may be reasonably requested; provided each of the Lenders shall, so long as no
Default or Unmatured Default has occurred and is continuing, coordinate its
visits or inspections through either the Administrative Agent or Syndication
Agent. To the extent reasonably practicable, any such inspection with respect to
a Subsidiary Borrower will be coordinated with an Authorized Officer of
Brightpoint. Brightpoint shall keep and maintain, and cause each of
Brightpoint's Subsidiaries to keep and maintain, in all material respects,
proper books of record and account in which entries in conformity with Agreement
Accounting Principles shall be made of all dealings and transactions in relation
to their respective businesses and activities, including, without limitation,
transactions and other dealings with respect to the Collateral. If a Default has
occurred and is continuing, Brightpoint, upon the Administrative Agent's
request, shall turn over copies of any such records to the Administrative Agent
or its representatives.
(G) Insurance and Condemnation Proceeds. Brightpoint and BPI shall direct
(and, if applicable, shall cause their Subsidiaries to direct) all insurers
under policies of property damage, boiler and machinery and business
interruption insurance and payors of any condemnation claim or award relating to
the Collateral to pay all proceeds (the "Proceeds") payable under such policies
or with respect to such claim or award for any loss with respect to the
Collateral directly to the Administrative Agent, for the benefit of the
Administrative Agent and the Holders of the Secured Obligations; provided,
however, unless a Default or Unmatured Default shall have occurred and be
continuing, the Administrative Agent shall remit all Proceeds to Brightpoint.
Each such policy shall contain a long-form loss-payable endorsement naming the
Administrative Agent as loss payee, which endorsement shall be in form and
substance acceptable to the Administrative Agent. Promptly after the receipt of
any Proceeds, Brightpoint shall repair or replace the Collateral or other assets
the loss or damage of which gave rise to such Proceeds,
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provided, however, that upon the earlier to occur of (a) 120 days after
Brightpoint receives such Proceeds or (b) the occurrence of a Default or an
Unmatured Default, Brightpoint shall return any Proceeds not so used to repair
or replace such Collateral or other assets at such time to the Administrative
Agent. The Administrative Agent shall apply the same to the principal amount of
the Revolving Loans outstanding at the time of such receipt or hold them as cash
collateral for the Obligations.
(H) ERISA Compliance. Brightpoint shall, and shall cause each of its
domestic Subsidiaries to, establish, maintain and operate all Plans to comply in
all material respects with the provisions of ERISA, the Code, all other
applicable laws, and the regulations and interpretations thereunder and the
respective requirements of the governing documents for such Plans.
(I) Maintenance of Property. Brightpoint shall cause all property used or
useful in the conduct of its business or the business of any Subsidiary to be
maintained and kept in adequate condition, repair and working order and supplied
with all necessary equipment and shall cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in the
judgment of Brightpoint may be necessary so that the business carried on in
connection therewith may be properly conducted at all times; provided, however,
that nothing in this Section 6.2(I) shall prevent Brightpoint from discontinuing
the operation or maintenance of any of such property if such discontinuance is,
in the judgment of Brightpoint, desirable in the conduct of its business or the
business of any Subsidiary and not disadvantageous in any respect to the
Administrative Agent or the Lenders.
(J) Environmental Compliance. Brightpoint and its Subsidiaries shall comply
with all Environmental, Health or Safety Requirements of Law, except where
noncompliance will not have or is not reasonably likely to subject Brightpoint
and its Subsidiaries to liability, individually or in the aggregate, in excess
of $250,000.
(K) Use of Proceeds. The Borrowers shall use the proceeds of the Loans to
pay transaction costs in connection with the transactions evidenced by the Loan
Documents, to refinance existing indebtedness of Brightpoint and its
Subsidiaries and to provide funds for the working capital needs and other
general corporate purposes of the Borrowers and their Subsidiaries. Brightpoint
will not, nor will it permit any Subsidiary to, use any of the proceeds of the
Loans to purchase or carry any "Margin Stock" or to make any Acquisition, other
than any Permitted Acquisition pursuant to Section 6.3(G).
(L) Foreign Employee Benefit Compliance. Brightpoint shall, and shall cause
each of its Subsidiaries and ERISA Affiliates to, establish, maintain and
operate all Foreign Employee Benefit Plans to comply in all material respects
with all laws, regulations and rules applicable thereto and the respective
requirements of the governing documents for such Plans, except for
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failures to comply which, in the aggregate, would not result in a material
obligation to pay money.
(M) Additional Guarantors/Pledge of Capital Stock. (i) Brightpoint will (a)
deliver an agreement evidencing the pledge, to the Administrative Agent, for the
benefit of the Holders of Secured Obligations, of all of the Capital Stock of
each Material Subsidiary which is a Domestic Subsidiary, within 30 days after
such Subsidiary has become a Material Subsidiary and (b) cause each Material
Subsidiary which is a Domestic Subsidiary, within 30 days after becoming a
Material Subsidiary, to execute and deliver to the Administrative Agent (1) a
Guarantor Assumption Letter pursuant to which it agrees to be bound by the
provisions of Article IX, (2) a Security Agreement, together, if applicable,
with trademark or patent security agreements, and (c) deliver and cause such
Subsidiaries to deliver corporate resolutions, opinions of counsel, stock
certificates, stock powers, UCC financing statements and such other corporate
documentation as the Administrative Agent may reasonably request, all in form
and substance reasonably satisfactory to the Administrative Agent.
(ii) Brightpoint shall deliver an agreement evidencing the pledge, to the
Administrative Agent, for the benefit of the Holders of Secured Obligations, of
65% of the Capital Stock of each Material Subsidiary which is not a Domestic
Subsidiary and which is not a Subsidiary of Brightpoint BV1, within 60 days
after such Subsidiary has become a Material Subsidiary, together with corporate
resolutions, opinions of counsel, stock certificates, stock powers and such
other corporate documentation as the Administrative Agent may reasonably
request, all in form and substance reasonably satisfactory to the Administrative
Agent; provided, however, in the event that any such Material Subsidiary is
wholly-owned by a Domestic Subsidiary, in connection with which all of the
requirements of clause (i) above have been satisfied and the activities of which
are limited to owning the stock of its Subsidiaries, then, the Administrative
Agent, at its option, may waive the requirement for the pledge of such Material
Subsidiary's stock under this clause (ii).
(N) Year 2000 Issues. The Borrower shall and shall cause each of its
Subsidiaries to take all actions reasonably necessary to assure that the Year
2000 Issues will not have a Material Adverse Effect.
6.3 Negative Covenants.
(A) Indebtedness; Subsidiary Indebtedness. Neither Brightpoint nor any of
its Subsidiaries shall directly or indirectly create, incur, assume or otherwise
become or remain directly or indirectly liable with respect to any Indebtedness,
except:
(a) the Obligations;
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(b) Permitted Existing Indebtedness, and any extension, renewal,
refunding or refinancing thereof, provided that any such extension,
renewal, refunding or refinancing is in an aggregate principal amount not
greater than the principal amount of and interest, fees and expenses
accrued on, such Permitted Existing Indebtedness outstanding at the time
thereof and is on terms (including, without limitation, maturity,
amortization, interest rate, premiums, fees, covenants, subordination,
events of default, and remedies) not materially less favorable to the
obligor or adverse to the Lenders than the terms of such Permitted
Existing Indebtedness and the obligor(s) with respect to which are not
altered;
(c) Indebtedness arising from intercompany loans ("Intercompany
Loans") from (1) Brightpoint, BPI or any other Subsidiary of Brightpoint
to any Borrower, (2) any Subsidiary to any other Subsidiary or (3) any
Borrower to any Subsidiary of Brightpoint which is not a Borrower provided
the aggregate Disqualified Subsidiary Investment does not exceed twenty
percent (20%) of Total Capital at any time, and provided further that all
such Indebtedness to Brightpoint or BPI is evidenced by notes (or other
evidence of indebtedness acceptable to the Administrative Agent) which are
pledged to the Administrative Agent under the Security Agreements;
(d) Indebtedness in respect of Hedging Agreements permitted under
Section 6.3(Q) including guarantying such Indebtedness;
(e) secured or unsecured purchase money Indebtedness (including
Capitalized Leases) incurred by Brightpoint or any of its Subsidiaries
after the Closing Date to finance the acquisition of fixed assets, if: (1)
at the time of such incurrence, no Default or Unmatured Default has
occurred and is continuing or would result from such incurrence; (2) such
Indebtedness has a scheduled maturity and is not due on demand; (3) the
aggregate outstanding amount at any time does not exceed two and one-half
percent (2.50%) of Total Capital; and (4) any Lien securing such
Indebtedness is permitted under Section 6.3(C) (such Indebtedness being
referred to herein as "Permitted Purchase Money Indebtedness");
(f) Indebtedness with respect to surety, appeal and performance bonds
obtained by Brightpoint or any of its Subsidiaries in the ordinary course
of business;
(g) Indebtedness constituting Contingent Obligations permitted by
Section 6.3(E);
(h) unsecured Indebtedness and other liabilities incurred in the
ordinary course of business and consistent with past practice, but not
incurred through the borrowing of money or the obtaining of credit (other
than customary trade terms); and
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(i) Permitted Subordinated Indebtedness in an aggregate original
issued principal amount not greater than $180,000,000 provided (A) the
LYONS and the indenture are in form and substance reasonably satisfactory
to the Agent and (B) all of the net cash proceeds from each issuance of
LYONS are paid to the Administrative Agent to repay the outstanding
principal amount of the Loans (provided net cash proceeds in excess of the
outstanding principal balance of the Loans need not be paid to the
Administrative Agent), with the payments being made (1) on the date of the
closing of the LYONS transaction in an amount equal to the principal
amount of all outstanding Floating Rate Loans and (2) thereafter at the
end of each Interest Period with respect to maturing Fixed Rate Loans; and
(j) other unsecured Indebtedness provided such other Indebtedness does
not exceed in the aggregate outstanding at any time five percent (5.0%) of
Total Capital.
(B) Sales of Assets. Neither Brightpoint nor any of its Subsidiaries shall
sell, assign, transfer, lease, convey or otherwise dispose of any property,
whether now owned or hereafter acquired, or any income or profits therefrom, or
enter into any agreement to do so, except:
(i) sales of Inventory in the ordinary course of business;
(ii) the disposition of obsolete Equipment in the ordinary course of
business; and
(iii) sales, assignments, transfers, leases, conveyances or other
dispositions of other assets if such transaction (a) is for all cash
consideration with respect to any Collateral which is sold, (b) is for not
less than fair market value, and (c) when combined with all such other
sales, assignments, transfers, conveyances or other dispositions (i) in the
immediately preceding twelve-month period represents the disposition of not
greater than five percent (5.0%) of Brightpoint's Total Capital as of the
beginning of such 12-month period and (ii) in the period from the Original
Closing Date to the date of such transaction represents the disposition of
not greater than fifteen percent (15%) of the sum of (a) Brightpoint's
consolidated net worth as of December 31, 1997 and (b) the original
outstanding principal balance of the LYONS.
(C) Liens. Neither Brightpoint nor any of its Subsidiaries shall directly
or indirectly create, incur, assume, permit or suffer to exist any Lien on or
with respect to any of their respective property or assets except:
(i) Liens created by the Loan Documents;
(ii) Permitted Existing Liens;
(iii) Customary Permitted Liens; and
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(iv) purchase money Liens (including the interest of a lessor under a
Capitalized Lease and Liens to which any property is subject at the time
of the acquisition thereof by Brightpoint or one of its Subsidiaries)
securing Permitted Purchase Money Indebtedness; provided that such Liens
shall not apply to any property of Brightpoint or its Subsidiaries other
than that purchased or subject to such Capitalized Lease.
In addition, neither Brightpoint nor any or its Subsidiaries shall become a
party to any agreement, note, indenture or other instrument, or take any other
action, which would prohibit the creation of a Lien on any of its properties or
other assets in favor of the Administrative Agent for the benefit of itself and
the Holders of Secured Obligations, as additional collateral for the
Obligations; provided that any agreement, note, indenture or other instrument in
connection with Permitted Purchase Money Indebtedness (including Leases) may
prohibit the creation of a Lien in favor of the Administrative Agent for the
benefit of itself and the Holders of the Secured Obligations on the items of
property obtained with the proceeds of such Permitted Purchase Money
Indebtedness.
(D) Investments. Except for Permitted Existing Investments in an amount
not greater than the amount thereof on the Closing Date and except to the extent
permitted pursuant to paragraph (G) below, neither Brightpoint nor any of its
Subsidiaries shall directly or indirectly make or own any Investment except:
(i) Investments in Cash Equivalents;
(ii) Investments received in connection with the bankruptcy or
reorganization of suppliers and customers and in settlement of delinquent
obligations of, and other disputes with, customers and suppliers arising
in the ordinary course of business;
(iii) Investments consisting of deposit accounts maintained by
Brightpoint and its Subsidiaries in connection with its cash management
system in the ordinary course of business and consistent with past
practice;
(iv) Investments consisting of Indebtedness permitted pursuant to
Section 6.3(A)(c) or other Investments in any Disqualified Subsidiary;
provided the Disqualified Subsidiary Investment shall not exceed twenty
percent (20%) of Total Capital at any time; and
(v) Investments resulting from Acquisitions permitted by Section
6.3(G); and
(vi) Investments with respect to Contract Finance Receivables; and
(vii) Investments in any other Persons which do not in the aggregate
at any time exceed five percent (5.0%) of Total Capital; provided further,
not more than $5,000,000
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of such Investments shall be permitted to be made in any other Person or
Persons engaged in businesses other than the businesses engaged in by
Brightpoint and its Subsidiaries on the date hereof or any business or
activities which are substantially similar, related or incidental thereto.
(E) Contingent Obligations. Neither Brightpoint nor any of its Subsidiaries
shall directly or indirectly create or become or be liable with respect to any
Contingent Obligation, contingent liability, long-term lease, synthetic lease,
commitment or Contractual Obligation, not reflected in the financial statements
attached hereto as Exhibit I, except: (i) as set forth on Schedule 5.18, (ii)
recourse obligations resulting from endorsement of negotiable instruments for
collection in the ordinary course of business; (iii) Permitted Existing
Contingent Obligations and any extensions, renewals or replacements thereof,
provided that any such extension, renewal or replacement is not greater than the
Indebtedness under, and shall be on terms no less favorable to Brightpoint or
such Subsidiary than the terms of, the Permitted Existing Contingent Obligation
being extended, renewed or replaced; (iv) obligations, warranties, and
indemnities, not relating to Indebtedness of any Person, which have been or are
undertaken or made in the ordinary course of business and not for the benefit of
or in favor of an Affiliate of Brightpoint or such Subsidiary; (v) Contingent
Obligations of Brightpoint or any of its Subsidiaries with respect to any
Indebtedness permitted by this Agreement; (vi) Contingent Obligations with
respect to surety, appeal and performance bonds obtained by Brightpoint or any
Subsidiary in the ordinary course of business; (vii) contingent liabilities
consisting of Contingent Purchase Price Obligations which could not reasonably
be expected to subject Brightpoint or any of its Subsidiaries to cash payment
liabilities individually or in the aggregate in excess of twenty percent (20%)
of Total Capital; and (viii) additional Contingent Obligations, liabilities and
the like which do not exceed $1,000,000 in the aggregate at any time.
(F) Restricted Junior Payments. Neither Brightpoint nor any of its
Subsidiaries shall declare or make any Restricted Junior Payment, except:
(i) payments made in connection with the repurchase of Capital Stock
or other Equity Interests in Brightpoint or any of its Subsidiaries from
any Person in connection with the termination (voluntarily or
involuntarily) of such Person's employment with Brightpoint or any of its
Subsidiaries which, in the aggregate, exceed the aggregate amount received
by Brightpoint or any of its Subsidiaries from the contemporaneous resale
or reissuance of such interests by not more than $1,000,000; and
(ii) payments of customary and reasonable fees and expense
reimbursements to members of the board of directors of Brightpoint and any
Subsidiary;
(iii) Restricted Junior Payments made by any Subsidiary of Brightpoint
to Brightpoint or any other Subsidiary of Brightpoint; and
(iv) Restricted Junior Payments as set forth on Schedule 6.3(F);
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provided, however, that the Restricted Junior Payments described in clause (i)
shall not be permitted if either a Default or an Unmatured Default shall have
occurred and be continuing at the date of declaration or payment thereof or
would result therefrom.
(G) Conduct of Business; Subsidiaries; Acquisitions. Neither Brightpoint
nor any of its Subsidiaries shall engage in any business other than the
businesses engaged in by them on the date hereof and any business or activities
which are substantially similar, related or incidental thereto. Brightpoint
shall not permit Brightpoint BV1, Brightpoint BV2 or Brightpoint Latin America
Holdings, Inc. to engage, either directly or indirectly in any operating
business enterprise but shall solely own the Capital Stock of their respective
Subsidiaries. Brightpoint shall not and shall not permit any of its Subsidiaries
to enter into any transaction or series of transactions in which it acquires all
or any significant portion of the assets (including, without limitation, the
Capital Stock thereof) of another Person unless such purchase meets the
following requirements (each such purchase constituting a "Permitted
Acquisition"):
(1) prior to each such purchase, Brightpoint shall deliver to the
Administrative Agent and the Lenders a certificate from one of
Brightpoint's Authorized Officers certifying that no Default or Unmatured
Default shall have occurred and be continuing or would result from such
transaction or transactions or the incurrence of any Indebtedness in
connection therewith; provided, that the Administrative Agent, in its sole
discretion or at the request of the Required Lenders, may require that
Brightpoint deliver to the Administrative Agent and the Lenders a
certificate from one of Brightpoint's Authorized Officers demonstrating to
the satisfaction of the Administrative Agent and the Required Lenders that
after giving effect to such transaction or transactions and the incurrence
of any Indebtedness permitted by Section 6.3(A) in connection therewith on
a pro forma basis as if such acquisition and such incurrence of
Indebtedness had occurred on the first day of the twelve-month period
ending on the last day of Brightpoint's most recently completed fiscal
quarter, Brightpoint would have been in compliance with all provisions of
Section 6.4 at all times during such twelve-month period;
(2) the purchase is consummated pursuant to a negotiated acquisition
agreement on a non-hostile basis and involves the purchase of a business
line similar, related or incidental to that of Brightpoint's and its
Subsidiaries as of the Closing Date; and
(3) the aggregate purchase price (including assumed liabilities) in
connection with all such transactions shall not exceed:
(A) for any single transaction or series of related transactions,
7.5% of Total Capital; provided the cash or Cash Equivalent portion of
such purchase price shall not exceed 5.5% of Total Capital; and
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(B) (i) for all transactions from and after the Closing Date through
December 31, 1998, $30,000,000; provided the cash or Cash Equivalent
portion of the purchase price for all such Acquisitions shall not exceed
$21,000,000; and (ii) for all transactions during any calendar year after
1998, 17.5% of Total Capital; provided the cash or Cash Equivalents
portion of the purchase price for all such Acquisitions during such year
shall not exceed 12.0% of Total Capital.
(H) Transactions with Shareholders and Affiliates. Neither Brightpoint nor
any of its Subsidiaries shall directly or indirectly (i) except as permitted in
Section 6.3(F), pay any fees or compensation to Management or any other
employees who are holders of Capital Stock or other Equity Interests in
Brightpoint or any of its Subsidiaries, other than wages, salaries and bonuses
of employees in the ordinary course and consistent with past practices; (ii)
enter into or permit to exist any transaction (including, without limitation,
the purchase, sale, lease or exchange of any property or the rendering of any
service) with any holder or holders of any Capital Stock or other Equity
Interests in Brightpoint, or with any Affiliate of Brightpoint, on terms that
are less favorable to Brightpoint or its Subsidiaries, as applicable, than
those that might be obtained in an arm's length transaction at the time from
Persons who are not such a holder or Affiliate; or (iii) enter into or permit
to exist any such non-arm's length transaction between any Borrower and any
Disqualified Subsidiary if as a result thereof the Disqualified Subsidiary
Investment would at any time exceed twenty percent (20%) of Consolidated Book
Equity.
(I) Restrictions on Fundamental Changes. Neither Brightpoint nor any of
its Subsidiaries shall enter into any merger or consolidation, or liquidate,
wind-up or dissolve (or suffer any liquidation or dissolution), or convey,
lease, sell, transfer or otherwise dispose of, in one transaction or series of
transactions, all or substantially all of Brightpoint's or any such
Subsidiary's business or property, whether now or hereafter acquired, except
transactions permitted under Section 6.3(B) and except that any Subsidiary of
Brightpoint or BPI may merge with or liquidate into Brightpoint or BPI or any
other Subsidiary of Brightpoint, provided that the surviving entity expressly
assumes any liabilities, if any, of either of such Subsidiaries with respect to
the Obligations pursuant to an assumption agreement reasonably satisfactory to
the Administrative Agent and provided further that the consolidated net worth
of the surviving corporation is not less than the consolidated net worth of the
Subsidiary with any liability with respect to the Obligations immediately prior
to such merger.
(J) Sales and Leasebacks. Neither Brightpoint nor any of its Subsidiaries
shall become liable, directly, by assumption or by Contingent Obligation, with
respect to any lease, whether an Operating Lease or a Capitalized Lease, of any
property (whether real or personal or mixed) (i) which it or one of its
Subsidiaries sold or transferred or is to sell or transfer to any other Person,
or (ii) which it or one of its Subsidiaries intends to use for substantially
the same purposes as any other property which has been or is to be sold or
transferred by it or one of its Subsidiaries to any other Person in connection
with such lease, unless in either case the sale
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involved is not prohibited under Section 6.3(B) and the lease involved is not
prohibited under Section 6.3(A).
(K) Margin Regulations. Neither the Borrower nor any of its Subsidiaries,
shall use all or any portion of the proceeds of any credit extended under this
Agreement to purchase or carry Margin Stock.
(L) ERISA. Brightpoint shall not (i) engage, or permit any of its
Subsidiaries to engage, in any prohibited transaction described in Sections 406
of ERISA or 4975 of the Code for which a statutory or class exemption is not
available or a private exemption has not been previously obtained from the DOL;
(ii) permit to exist any accumulated funding deficiency (as defined
in Sections 302 of ERISA and 412 of the Internal Revenue Code), with
respect to any Benefit Plan, whether or not waived;
(iii) fail, or permit any Controlled Group member to fail, to pay
timely required contributions or annual installments due with respect to
any waived funding deficiency to any Benefit Plan;
(iv) terminate, or permit any Controlled Group member to terminate,
any Benefit Plan which would result in any liability of Brightpoint or any
Controlled Group member under Title IV of ERISA;
(v) fail to make any contribution or payment to any Multiemployer
Plan which Brightpoint or any Controlled Group member may be required to
make under any agreement relating to such Multiemployer Plan, or any law
pertaining thereto;
(vi) fail, or permit any Controlled Group member to fail, to pay any
required installment or any other payment required under Section 412 of the
Internal Revenue Code on or before the due date for such installment or
other payment; or
(vii) amend, or permit any Controlled Group member to amend, a Plan
resulting in an increase in current liability for the plan year such that
Brightpoint or any Controlled group member is required to provide security
to such Plan under Section 401(a)(29) of the Code.
(M) Issuance of Equity Interests. Neither Brightpoint nor any of its
Subsidiaries shall issue any ownership, membership or other equity interests
after the date of this Agreement if such issuance causes a Change of Control to
occur.
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(N) Organizational Documents. Neither Brightpoint nor any of its
Subsidiaries shall amend, modify or otherwise change any of the terms or
provisions in any of their respective organizational documents as in effect on
the date hereof in any manner adverse to the interests of the Lenders without
the prior written consent of the Required Lenders.
(O) Other Indebtedness. Neither Brightpoint nor any of its Subsidiaries
shall amend, supplement or otherwise modify the terms of any Indebtedness (other
than the Obligations and other than Intercompany Loans) permitted under Section
6.3(A) in any way that would not be materially less advantageous to Brightpoint
or such Subsidiary or materially adverse to the Lenders, including, without
limitation, with respect to amount, maturity, amortization, interest rate,
premiums, fees, covenants, subordination, events of default and remedies.
(P) Fiscal Year. Neither Brightpoint nor any of its consolidated
Subsidiaries shall change its fiscal year for accounting or tax purposes from a
period consisting of the 12-month period ending on December 31 of each calendar
year.
(Q) Hedging Obligations. Brightpoint shall not and shall not permit any of
its Subsidiaries to enter into any interest rate, commodity or foreign currency
exchange, swap, collar, cap or similar agreements other than interest rate,
foreign currency or commodity exchange, swap, collar, cap, leveraged derivative
or similar agreements pursuant to which Brightpoint or any of its Subsidiaries
have hedged its or their actual interest rate, foreign currency or commodity
exposure (such hedging agreements are sometimes referred to herein as "Hedging
Agreements"). In the event a Lender elects to enter into any Hedging Agreements
with Brightpoint or any of its Subsidiaries, the obligations of Brightpoint or
such Subsidiary with respect to such Hedging Agreements shall be Secured
Obligations secured by the Collateral.
(R) Subordinated Indebtedness. Brightpoint shall not and shall not permit
any Subsidiary to, amend, supplement or modify the terms of any Permitted
Subordinated Indebtedness, including without limitation, the LYONS or the
Indenture, or make any payment required as a result of an amendment or change
thereto other than amendments, supplements or modifications which (i) decrease
the rate of interest payable on the Permitted Subordinated Indebtedness, (ii)
provide for the payment in kind in lieu of cash of any portion of the interest
on the Permitted Subordinated Indebtedness, (iii) provide for the extension of
the maturity date with respect to any principal or interest payment to be made
under the instruments evidencing Permitted Subordinated Indebtedness, (iv)
provide more flexibility to Brightpoint or its Subsidiaries in connection with
any financial covenants, (v) waive any defaults existing in connection with the
Permitted Subordinated Indebtedness, and (vi) do not adversely affect in any
respect the interests of the Administrative Agent or the Lenders.
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6.4 Financial Covenants. Brightpoint shall comply with the following:
(A) Defined Terms for Financial Covenants. The following terms used in
this Agreement shall have the following meanings (such meanings to be
applicable, except to the extent otherwise indicated in a definition of a
particular term, both to the singular and the plural forms of the terms
defined):
"Capital Expenditures" means, for any period, the aggregate of all
expenditures (whether paid in cash or accrued as liabilities and including
Capitalized Leases and Permitted Purchase Money Indebtedness) by Brightpoint
and its Subsidiaries during that period that, in conformity with Agreement
Accounting Principles, are required to be included in or reflected by the
property, plant, equipment or similar fixed asset accounts reflected in the
consolidated balance sheet of Brightpoint and its Subsidiaries other than with
respect to the acquisition of inventory in the ordinary course of business.
"Consolidated Book Equity" shall mean, at a particular date, all amounts
which would be included under consolidated book equity for Brightpoint and its
Subsidiaries determined on a consolidated basis in accordance with Agreement
Accounting Principles.
"EBITDA" means, for any period, on a consolidated basis for Brightpoint
and its consolidated Subsidiaries, the sum of the amounts for such period,
without duplication, of (i) Net Income, plus (ii) charges against income for
foreign income taxes or U.S. income taxes to the extent deducted in computing
Net Income, plus (iii) Interest Expense to the extent deducted in computing Net
Income, plus (iv) depreciation expense to the extent deducted in computing Net
Income, plus (v) amortization expense, including, without limitation,
amortization of goodwill and other intangible assets to the extent deducted in
computing Net Income, plus (vi) other non-cash charges (including, without
duplication, any effect of any write-up in the value of Inventory attributable
to purchase accounting) in accordance with Agreement Accounting Principles to
the extent deducted in computing Net Income, plus (vii) income attributable to
minority interests to the extent excluded from Net Income, minus (viii)
interest income, minus (ix) Net Extraordinary Gains. As used herein "Net
Extraordinary Gains" shall mean the sum of, but only if positive, extraordinary
gains (and any nonrecurring unusual gains arising in or outside of the ordinary
course of business not included in extraordinary gains determined in accordance
with Agreement Accounting Principles which have been included in the
determination of Net Income) minus extraordinary losses (and any nonrecurring
unusual losses arising in or outside of the ordinary course of business not
included in extraordinary losses determined in accordance with Agreement
Accounting Principles).
"Interest Expense" means, for any period, the consolidated total interest
expense of Brightpoint and its Subsidiaries, determined on a consolidated
basis, whether paid or accrued, but without duplication (including the interest
component of Capitalized Leases), but excluding
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interest expense not payable in cash (including amortization of discount), all
as determined in conformity with Agreement Accounting Principles.
"Net Income" means, for any period, the net earnings (or loss) after
taxes of Brightpoint and its Subsidiaries on a consolidated basis for such
period taken as a single accounting period determined in conformity with
Agreement Accounting Principles.
"Rentals" of a Person means the aggregate fixed amounts payable by such
Person under any lease of real or personal property but does not include any
amounts payable under Capitalized Leases of such Person.
(B) Fixed Charge Coverage Ratio. Brightpoint shall maintain a ratio ("Fixed
Charge Coverage Ratio") of: (i) the sum of the amounts of Net Income, plus (b)
charges against income for foreign income taxes or U.S. income taxes to the
extent deducted in computing Net Income, plus (c) Interest Expense to the extent
deducted in computing Net Income plus (d) Rentals to the extent deducted in
computing Net Income to (ii) the sum of the amounts of (a) Interest Expense to
the extent deducted in computing Net Income, plus (b) Rentals to the extent
deducted in computing Net Income, plus (c) scheduled amortization of the
principal portion of all Indebtedness of Brightpoint and its Subsidiaries during
such period of at least 3.25 to 1.00 as of the end of each fiscal quarter.
In each case the Fixed Charge Coverage Ratio shall be determined as of the last
day of each fiscal quarter for the four-quarter period ending on such day.
(C) Minimum Consolidated Book Equity. Brightpoint shall not permit its
Consolidated Book Equity at any time to be less than the sum of (a)
$175,000,000, plus (b) fifty percent (50%) of Net Income (if positive)
calculated separately for each fiscal quarter ending after September 30, 1997,
plus (c) seventy-five percent (75%) of the net cash proceeds resulting from the
issuance by Brightpoint of any of its Capital Stock.
(D) Maximum Leverage and Senior Debt Ratios.
(1) Brightpoint shall not permit the ratio ("Leverage Ratio") of (i)
the sum of (a) Indebtedness of Brightpoint and its consolidated
Subsidiaries for borrowed money and (b) Capitalized Lease Obligations to
(ii) EBITDA to be greater than 5.00 to 1.00 at the end of each fiscal
quarter ending on or after December 31, 1997 through and including December
31, 1998 and 4.50 to 1.00 at the end of each fiscal quarter thereafter. The
Leverage Ratio shall be calculated, in each case, determined as of the last
day of each fiscal quarter based upon (A) for Indebtedness (including
Permitted Subordinated Indebtedness) and Capitalized Lease Obligations,
Indebtedness and Capitalized Lease Obligations as of the last day of each
such fiscal quarter; and (B) for EBITDA, the actual amount for the
two-quarter period ending on such day multiplied by two (2).
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(2) Brightpoint shall not permit the ratio ("Senior Debt Ratio") of
(i) the sum of (a) Indebtedness other than the Permitted Subordinated
Indebtedness of Brightpoint and its consolidated Subsidiaries for borrowed
money and (b) Capitalized Lease Obligations to (ii) EBITDA to be greater
than 3.50 to 1.00 at the end of each fiscal quarter ending on or after
December 31, 1997. The Senior Debt Ratio shall be calculated, in each case,
determined as of the last day of each fiscal quarter based upon (A) for
Indebtedness and Capitalized Lease Obligations, Indebtedness (other than
the Permitted Subordinated Indebtedness) and Capitalized Lease Obligations
as of the last day of each such fiscal quarter; and (B) for EBITDA, the
actual amount for the two-quarter period ending on such day multiplied by
two (2).
(E) Domestic Asset Coverage Ratio. Brightpoint shall maintain a ratio
("Domestic Asset Coverage Ratio") of (i) the sum of (a) Receivables (including
Receivables generated through Contract Finance Receivables but excluding
Receivables owing from any consolidated Subsidiary), (b) Inventory (excluding
any Inventory held with respect to Contract Finance Receivables) and (c) cash
and Cash Equivalents in each case maintained by Brightpoint and BPI in the
United States to (ii) the sum of (a) Indebtedness other than Permitted
Subordinated Indebtedness of Brightpoint and its consolidated Subsidiaries for
borrowed money and (b) Capitalized Lease Obligations to be greater than 0.75 to
1.00 at the end of any fiscal quarter.
(F) Capital Expenditures. Brightpoint will not, nor will it permit any
Subsidiary to, expend, or be committed to expend, for Capital Expenditures
during any one fiscal year in the aggregate for Brightpoint and its Subsidiaries
in excess of (a) $25,000,000 for the fiscal year ending December 31, 1998 and
(b) for each fiscal year thereafter the sum of (i) $25,000,000 plus (ii) the
product of $2,000,000 multiplied by the number of complete fiscal years after
December 31, 1998.
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6.5 Corporate Restructing. Notwithstanding anything to the contrary
contained in this Agreement, the Borrower and its Subsidiaries may effect a
restructuring of their corporate organization from the current organizational
structure as set forth in Schedule 6.5A to the organizational structure as set
forth in Schedule 6.5B (the "Tax Restructuring"). In connection with the Tax
Restructuring, the Administrative Agent is hereby authorized by each of the
Lenders to:
(i) release the Collateral granted under the Original Credit
Agreement and related documents which is subject to each of the following
pledge agreements:
(a) that certain Equitable Share Charge dated as of June 24,
1997 executed by Brightpoint and Brightpoint EMA Limited in favor of
the Administrative Agent for the benefit of the Holders of Secured
Obligations pledging 20% and 45%, respectively, of the Capital Stock
of Brightpoint (UK) Limited to secure payment of the Secured
Obligations;
(b) that certain Share Mortgage dated as of June 24, 1997
executed by Brightpoint and Brightpoint International (Asia Pacific)
Pty Limited in favor of the Administrative Agent for the benefit of
the Holders of Secured Obligations, together with any Notice of
Identification delivered thereunder with respect to the Capital Stock
of Brightpoint Australia Pty Limited to secure payment of the Secured
Obligations;
(c) that certain Equitable Share Charge dated as of June 24,
1997 executed by Brightpoint and Brightpoint International (Asia
Pacific) Pte Ltd in favor of the Administrative Agent for the benefit
of the Holders of Secured Obligations pledging 20% and 45%,
respectively, of the Capital Stock of Brightpoint China Limited to
secure payment of the Secured Obligations; and
(d) that certain Share Pledge Agreement dated as of November 15,
1997 executed by Brightpoint International Ltd in favor of the
Administrative Agent for the benefit of the Holders of Secured
Obligations pledging 65%, of the Capital Stock of Brightpoint Sweden
AG to secure payment of the Secured Obligations; and
(ii) execute such other consents or other documents as shall be
acceptable to the Administrative Agent and which are reasonably requested
by Brightpoint or its Subsidiaries in connection with effecting the Tax
Restructuring.
ARTICLE VII: DEFAULTS
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7.1 Defaults. Each of the following occurrences shall constitute a Default
under this Agreement:
(a) Failure to Make Payments When Due. Any Borrower shall (i) fail to pay
when due any of the Obligations consisting of principal with respect to the
Loans or (ii) shall fail to pay within five (5) days of the date when due any of
the other Obligations under this Agreement or the other Loan Documents.
(b) Breach of Certain Covenants. Any Borrower shall fail duly and
punctually to perform or observe any agreement, covenant or obligation binding
on such Borrower under Sections 6.1 (other than clauses (A), (D), (E), (F) or
(H) thereof), 6.2(K), 6.2(M), 6.3 or 6.4.
(c) Breach of Representation or Warranty. Any representation or warranty
made or deemed made by any Borrower or Guarantor to the Administrative Agent or
any Lender herein or by Brightpoint or any of its Subsidiaries in any of the
other Loan Documents or in any statement or certificate at any time given by any
such Person pursuant to any of the Loan Documents shall be false or misleading
in any material respect on the date as of which made (or deemed made).
(d) Other Defaults. Any Borrower shall default in the performance of or
compliance with any term contained in this Agreement (other than as covered by
paragraphs (a), (b) or (c) of this Section 7.1), or Brightpoint or any of its
Subsidiaries shall default in the performance of or compliance with any term
contained in any of the other Loan Documents, and such default shall continue
for ten (10) days after the earlier to occur of (i) notice from the
Administrative Agent or any Lender to Brightpoint of such Default and (ii)
Brightpoint or any of its Subsidiaries knew of such default or should have known
of such default exercising reasonable diligence.
(e) Default as to Other Indebtedness. Brightpoint or any of its
Subsidiaries shall fail to make any payment when due (whether by scheduled
maturity, required prepayment, acceleration, demand or otherwise) with respect
to any Indebtedness (other than the Obligations) the outstanding principal
amount of which Indebtedness is in excess of $2,500,000; or any breach, default
or event of default shall occur, or any other condition shall exist under any
instrument, agreement or indenture pertaining to any such Indebtedness, if the
effect thereof is to cause an acceleration, mandatory redemption, a requirement
that Brightpoint or any such Subsidiary offer to purchase such Indebtedness or
other required repurchase of such Indebtedness, or permit the holder(s) of such
Indebtedness to accelerate the maturity of any such Indebtedness or require a
redemption or other repurchase of such Indebtedness; or any such Indebtedness
shall be otherwise declared to be due and payable (by acceleration or otherwise)
or required to be prepaid, redeemed or otherwise repurchased by Brightpoint or
any of its Subsidiaries (other than by a regularly scheduled required
prepayment) prior to the stated maturity thereof.
(f) Involuntary Bankruptcy; Appointment of Receiver, Etc.
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(i) An involuntary case shall be commenced against Brightpoint or any
of its Subsidiaries and the petition shall not be dismissed, stayed,
bonded or discharged within sixty (60) days after commencement of the
case; or a court having jurisdiction in the premises shall enter a decree
or order for relief in respect of Brightpoint or any of its Subsidiaries
in an involuntary case, under any applicable bankruptcy, insolvency or
other similar law now or hereinafter in effect; or any other similar
relief shall be granted under any applicable federal, state, local or
foreign law.
(ii) A decree or order of a court having jurisdiction in the premises
for the appointment of a receiver, liquidator, sequestrator, trustee,
custodian or other officer having similar powers over Brightpoint or any
of its Subsidiaries or over all or a substantial part of the property of
Brightpoint or any of its Subsidiaries shall be entered; or an interim
receiver, trustee or other custodian of Brightpoint or any of its
Subsidiaries or of all or a substantial part of the property of
Brightpoint or any of its Subsidiaries shall be appointed or a warrant of
attachment, execution or similar process against any substantial part of
the property of Brightpoint or any of its Subsidiaries shall be issued and
any such event shall not be stayed, dismissed, bonded or discharged within
sixty (60) days after entry, appointment or issuance.
(g) Voluntary Bankruptcy; Appointment of Receiver, Etc. Brightpoint or any
of its Subsidiaries shall (i) commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, (ii)
consent to the entry of an order for relief in an involuntary case, or to the
conversion of an involuntary case to a voluntary case, under any such law,
(iii) consent to the appointment of or taking possession by a receiver, trustee
or other custodian for all or a substantial part of its property, (iv) make any
assignment for the benefit of creditors or (v) take any corporate action to
authorize any of the foregoing.
(h) Judgments and Attachments. Any money judgment(s), writ or warrant of
attachment, or similar process against any of Brightpoint or any of its
Subsidiaries or any of their respective assets involving in any single case or
in the aggregate an amount in excess of $2,500,000 is (are) entered and shall
remain undischarged, unvacated, unbonded or unstayed for a period of sixty (60)
days or in any event later than fifteen (15) days prior to the date of any
proposed sale thereunder.
(i) Dissolution. Any order, judgment or decree shall be entered against
Brightpoint or any of its Subsidiaries decreeing its involuntary dissolution or
split up and such order shall remain undischarged and unstayed for a period in
excess of sixty (60) days; or Brightpoint or any of its Subsidiaries shall
otherwise dissolve or cease to exist except as specifically permitted by this
Agreement unless the dissolving entity is a limited liability company which
elects to continue its existence.
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(j) Loan Documents; Failure of Security. At any time, for any reason, (i)
any Loan Document as a whole that materially affects the ability of the
Administrative Agent, or any of the Lenders to enforce the Obligations or
enforce their rights against the Collateral ceases to be in full force and
effect or any of Brightpoint or any of its Subsidiaries party thereto seeks to
repudiate its obligations thereunder and the Liens intended to be created
thereby are, or any of Brightpoint or any such Subsidiary seeks to render such
Liens, invalid and unperfected, or (ii) Liens on Collateral with a fair market
value in excess of $2,000,000 in favor of the Administrative Agent contemplated
by the Loan Documents shall, at any time, for any reason, be invalidated or
otherwise cease to be in full force and effect, or such Liens shall not have the
priority contemplated by this Agreement or the Loan Documents.
(k) Termination Event. Any Termination Event occurs which the Required
Lenders believe is reasonably likely to subject Brightpoint or any of its
Subsidiaries to liability individually or in the aggregate in excess of
$1,000,000.
(l) Waiver of Minimum Funding Standard. If the plan administrator of any
Plan applies under Section 412(d) of the Code for a waiver of the minimum
funding standards of Section 412(a) of the Code and any Lender believes the
substantial business hardship upon which the application for the waiver is based
could reasonably be expected to subject either Brightpoint or any Controlled
Group member to liability individually or in the aggregate in excess of
$250,000.
(m) Change of Control. A Change of Control shall occur.
(n) Hedging Agreements. Nonpayment by Brightpoint or any of its
Subsidiaries of any obligation under any Hedging Agreements entered into with
any Lender or any Affiliate of any Lender on the date such payment is due or the
breach by Brightpoint or any of its Subsidiaries of any other term, provision or
condition contained in any such Hedging Agreements which breach remains
unremedied for five (5) days.
(o) Environmental Matters. Brightpoint or any of its Subsidiaries shall be
the subject of any proceeding or investigation pertaining to (i) the Release by
Brightpoint or any of its Subsidiaries of any Contaminant into the environment,
(ii) the liability of any of Brightpoint or any of its Subsidiaries arising from
the Release by any other Person of any Contaminant into the environment, or
(iii) any violation of any Environmental, Health or Safety Requirements of Law
by Brightpoint or any of its Subsidiaries, which, in any case, has or is
reasonably likely to subject Brightpoint or any of its Subsidiaries to liability
individually or in the aggregate in excess of $250,000.
(p) Guarantor Revocation. Any guarantor of the Obligations shall terminate
or revoke or refuse to perform any of its payment obligations under the
applicable guarantee agreement or
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breach any of the other terms of such guarantee agreement which breach
remains unremedied for five (5) days.
A Default shall be deemed "continuing" until waived in writing in
accordance with Section 8.3.
ARTICLE VIII: ACCELERATION, DEFAULTING LENDERS; WAIVERS, AMENDMENTS AND REMEDIES
8.1 Remedies
(a) Termination of Commitments; Acceleration. If any Default described in
Section 7.1(f) or 7.1(g) occurs with respect to either of the Borrowers, the
obligations of the Lenders to make Loans hereunder and the obligation of the
Administrative Agent or any Issuing Lender to issue Letters of Credit hereunder
shall automatically terminate and the Obligations shall immediately become due
and payable without any election or action on the part of the Administrative
Agent, any Lender or any Issuing Lender. If any other Default occurs, the
Required Lenders may (i) terminate or suspend the obligations of the Lenders to
make Loans hereunder and the obligation of the Issuing Lenders to issue Letters
of Credit hereunder, or (ii) declare the Obligations to be due and payable, or
both, and upon any declaration under clause (ii), the Obligations shall become
immediately due and payable, without presentment, demand, protest or notice of
any kind, all of which the Borrowers expressly waive.
(b) Rescission. If at any time after termination of the Lenders'
obligations to make Loans or acceleration of the maturity of the Loans,
Borrowers shall pay all arrears of interest and all payments on account of
principal of the Loans and Reimbursement Obligations which shall have become due
otherwise than by acceleration (with interest on principal and, to the extent
permitted by law, on overdue interest, at the rates specified in this Agreement)
and all Defaults and Unmatured Defaults (other than nonpayment of principal of
and accrued interest on the Loans due and payable solely by virtue of
acceleration) shall be waived pursuant to Section 8.3, then upon the written
consent of the Required Lenders and written notice to Borrowers, the termination
of Lenders' respective obligations to make Loans and the respective Lenders' and
the Issuing Lenders' obligations to participate in or issue Letters of Credit or
the aforesaid acceleration and its consequences may be rescinded and annulled;
but such action shall not affect any subsequent Default or Unmatured Default or
impair any right or remedy consequent thereon. The provisions of the preceding
sentence are intended merely to bind the Lenders and the Issuing Lenders to a
decision which may be made at the election of the Required Lenders; they are not
intended to benefit Borrowers and do not give Borrowers the right to require the
Lenders to rescind or annul any termination of the aforesaid obligations of the
Lenders or Issuing Lenders or any acceleration hereunder, even if the conditions
set forth herein are met.
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(c) Enforcement. The Borrowers acknowledge that in the event the Borrowers
fail to perform, observe or discharge any of their respective obligations or
liabilities under this Agreement or any other Loan Document, any remedy of law
may prove to be inadequate relief to the Agents, the Issuing Lenders and the
Lenders; therefore, Borrowers agree that the Agents, the Issuing Lenders and the
Lenders shall be entitled to temporary and permanent injunctive relief in any
such case without the necessity of proving actual damages.
8.2 Defaulting Lender. In the event that any Lender fails to fund its
Revolving Credit Share of any Advance requested or deemed requested by either
Brightpoint or BPI which such Lender is obligated to fund under the terms of
this Agreement (the funded portion of such Advance being hereinafter referred to
as a "Non Pro Rata Loan"), until the earlier of such Lender's cure of such
failure and the termination of the Commitments, the proceeds of all amounts
thereafter repaid to the Administrative Agent by the Borrowers and otherwise
required to be applied to such Lender's share of all other Obligations pursuant
to the terms of this Agreement shall be advanced to the Borrowers by the
Administrative Agent ("Cure Loans") on behalf of such Lender to cure, in full or
in part, such failure by such Lender, but shall nevertheless be deemed to have
been paid to such Lender in satisfaction of such other Obligations.
Notwithstanding anything in this Agreement to the contrary:
(i) the foregoing provisions of this Section 8.2 shall apply only
with respect to the proceeds of payments of Obligations and shall not
affect the conversion or continuation of Loans pursuant to Section 2.8;
(ii) any such Lender shall be deemed to have cured its failure to
fund its Revolving Credit Share of any Advance at such time as an amount
equal to such Lender's original Revolving Credit Share of the requested
principal portion of such Advance is fully funded to the applicable
Borrower, whether made by such Lender itself or by operation of the terms
of this Section 8.2, and whether or not the Non Pro Rata Loan with respect
thereto has been repaid, converted or continued;
(iii) amounts advanced to either Brightpoint or BPI to cure, in full
or in part, any such Lender's failure to fund its Revolving Credit Share of
any Advance shall bear interest at the rate applicable to Base Rate Loans
in effect from time to time, and for all other purposes of this Agreement
shall be treated as if they were Base Rate Loans;
(iv) regardless of whether or not a Default has occurred or is
continuing, and notwithstanding the instructions of the applicable Borrower
as to its desired application, all repayments of principal which, in
accordance with the other terms of this Agreement, would be applied to the
outstanding Base Rate Loans shall be applied first, ratably to all Base
Rate Loans constituting Non Pro Rata Loans,
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second, ratably to Base Rate Loans other than those constituting Non Pro
Rata Loans or Cure Loans and, third, ratably to Base Rate Loans
constituting Cure Loans;
(v) for so long as and until the earlier of any such Lender's cure of
the failure to fund its Revolving Credit Share of any Advance and the
termination of the Commitments, the term "Required Lenders" for purposes
of this Agreement shall mean Lenders (excluding all Lenders whose failure
to fund their respective Revolving Credit Shares of such Advance have not
been so cured) whose Pro Rata Shares represent at least sixty-six and
two-thirds (66-2/3%) of the aggregate Pro Rata Shares of such Lenders; and
(vi) for so long as and until any such Lender's failure to fund its
Revolving Credit Share of any Advance is cured in accordance with Section
8.2(ii), (A) such Lender shall not be entitled to any facility fees with
respect to its Commitments and (B) such Lender shall not be entitled to
any letter of credit fees, which facility fees and letter of credit fees
shall accrue in favor of the non-defaulting Lenders, shall be allocated
among such performing Lenders ratably based upon their relative Revolving
Loan Commitments.
8.3 Amendments. Subject to the provisions of this Article VIII, the
Required Lenders (or the Administrative Agent with the consent in writing of
the Required Lenders) and the Borrowers may enter into agreements supplemental
hereto for the purpose of adding or modifying any provisions to the Loan
Documents or changing in any manner the rights of the Lenders or the Borrowers
hereunder or waiving any Default hereunder; provided, however, that no such
supplemental agreement shall, without the consent of each Lender affected
thereby:
(i) Postpone or extend the Termination Date or any other date fixed
for any payment of principal of, or interest on, the Loans, the
Reimbursement Obligations or any fees or other amounts payable to such
Lender (except with respect to (a) any modifications of the provisions
relating to prepayments of Loans and other Obligations and (b) a waiver of
the application of the default rate of interest pursuant to Section 2.11
hereof).
(ii) Reduce the principal amount of any Loans or L/C Obligations, or
reduce the rate or extend the time of payment of interest or fees thereon.
(iii) Reduce the percentage specified in the definition of Required
Lenders or any other percentage of Lenders specified to be the applicable
percentage in this Agreement to act on specified matters.
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(iv) Increase the amount of the Revolving Loan Commitment of any
Lender or, with respect to the Alternate Currency Lender, the Alternate
Currency Commitment, hereunder (except with respect to an increase in any
sublimits for any Types of Loans within the Commitments).
(v) Permit any Borrower to assign its rights under this Agreement.
(vi) Amend this Section 8.3.
(vii) Other than (a) in connection with transactions permitted under
the terms of this Agreement, (b) pursuant to the terms of Section 6.25 and
(c) the release of any Subsidiary Borrower under the Original Credit
Agreement from its guaranty of the Obligations under such Agreement,
release any Guarantor from its obligations under Article IX, release any
other guarantor of all or any part of the Obligations or release all or
substantially all of the Collateral.
No amendment of any provision of this Agreement relating to the Administrative
Agent shall be effective without the written consent of the Administrative
Agent. No amendment of any provision of this Agreement relating to any Issuing
Lender shall be effective without the written consent of the Administrative
Agent and each of the Issuing Lenders. No amendment of any provision of this
Agreement relative to the Swing Line Lender shall be effective without the
written consent of the Swing Line Lenders. No amendment of any provision of this
Agreement relating to the Alternate Currency Credits or any Alternate Currency
Addendum shall be effective without the written consent of the Alternate
Currency Lender. The Administrative Agent may waive payment of the fee required
under Section 13.3(B) without obtaining the consent of any of the Lenders.
Notwithstanding anything herein to the contrary, after the Euro Implementation
Date, or in immediate anticipation thereof, the Administrative Agent (acting
reasonably and after consultation with other parties hereto) may by reasonable
prior notice to the other parties hereto amend this Agreement unilaterally for
the exclusive purpose of effectuating changes hereto which are necessary to the
integration of the making of Revolving Loans hereunder in Euro and only in a
manner which shall not deteriorate the position of any Agent or Lender from its
respective position prior to the Euro Implementation Date.
8.4 Preservation of Rights. No delay or omission of the Lenders, the
Issuing Lenders, the Administrative Agent to exercise any right under the Loan
Documents shall impair such right or be construed to be a waiver of any Default
or an acquiescence therein, and the making of a Loan or the issuance of a Letter
of Credit notwithstanding the existence of a Default or the inability of the
Borrowers to satisfy the conditions precedent to such Loan or issuance of such
Letter of Credit shall not constitute any waiver or acquiescence. Any single or
partial exercise of any such right shall not preclude other or further exercise
thereof or the exercise of any other right, and no waiver, amendment or other
variation of the terms, conditions or provisions of the Loan Documents
whatsoever shall be valid unless in writing signed by the Lenders required
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pursuant to Section 8.3, and then only to the extent in such writing
specifically set forth. All remedies contained in the Loan Documents or by law
afforded shall be cumulative and all shall be available to the Administrative
Agent, the Issuing Lenders and the Lenders until the Obligations have been paid
in full.
ARTICLE IX: GUARANTEE
9.1 Guarantee; Modifications to Obligations. In order to induce the Lenders
to extend credit hereunder and the Issuing Banks to issue the Letters of Credit
hereunder, each Guarantor fully and unconditionally guarantees, as a primary
obligor and not merely as a surety, jointly with the other Guarantors and
severally, the Obligations (including, without limitation, interest accruing
hereunder after the commencement of any case under the United States Bankruptcy
Code, whether or not allowed as a claim in such case); provided, however, the
guaranty hereunder by each Guarantor which is a Subsidiary Borrower shall be
limited to the Obligations of the Subsidiary Borrowers. Each Guarantor further
agrees that the Obligations may be extended or renewed, in whole or in part,
without notice to or further assent from it, and that it will remain bound upon
its guarantee ("Guarantee") hereunder notwithstanding any such extension or
renewal of any Obligation.
9.2 Waivers. Each Guarantor waives presentment to, demand of payment from
and protest to any Borrower of any of the Obligations, and also waives notice of
acceptance of its obligations and notice of protest for nonpayment. The
obligations of the Guarantors hereunder shall not be affected by the failure of
any Lender (including the Alternate Currency Lender), any Issuing Bank or any
Agent to assert any claim or demand or to enforce any right or remedy against
any Borrower or any other Guarantor under the provisions of this Agreement or
any of the other Loan Documents or otherwise, or, except as specifically
provided therein, by any rescission, waiver, amendment or modification of any of
the terms or provisions of this Agreement, any of the other Loan Documents or
any other agreement. Each Guarantor further agrees that its Guarantee hereunder
constitutes a promise of payment when due and not merely of collection, and
waives any right to require that resort be had by any Lender or any Issuing Bank
to any balance of any deposit account or credit on the books of any Lender or
any Issuing Bank in favor of any Subsidiary Borrower or any other person.
9.3 Guarantee Unconditional. Each Guarantor agrees that its obligations
under this Guarantee shall be unconditional, irrespective of:
(i) the validity, enforceability, avoidance, novation or subordination
of any of the Obligations or any of the Loan Documents;
(ii) the absence of any attempt by, or on behalf of, any Lender, any
Issuing Bank or any Agent to collect, or to take any other action to all or
any part of the
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Obligations whether from or against any Borrower, any other guarantor of
the Obligations or any other Person;
(iii) the election of any remedy by, or on behalf of, any Lender, any
Issuing Bank or any Agent with respect to all or any part of the
Obligations;
(iv) the waiver, consent, extension, forbearance or granting of any
indulgence by, or on behalf of, any Lender, any Issuing Bank or any Agent
with respect to any provision of any of the Loan Documents;
(v) the failure of the Administrative Agent to take any steps to
perfect and maintain its security interest in, or to preserve its rights
to, any security or collateral for the Obligations;
(vi) the election by, or on behalf of, any one or more of the Lenders
or Issuing Banks, in any proceeding instituted under Chapter 11 of Title 11
of the United States Code (11 U.S.C. 101 et seq.) (the "Bankruptcy Code"),
of the application of Section 1111(b)(2) of the Bankruptcy Code;
(vii) any borrowing or grant of a security interest by any Borrower,
as debtor-in-possession, under Section 364 of the Bankruptcy Code;
(viii) the disallowance, under Section 502 of the Bankruptcy Code, of
all or any portion of the claims of any of the Lenders, any of the Issuing
Banks or any Agent for repayment of all or any part of the Obligations; or
(ix) any other circumstance which might otherwise constitute a legal
or equitable discharge or defense of any Borrower or any Guarantor.
The obligations of the Guarantors hereunder shall not be subject to
any reduction, limitation, impairment or termination for any reason, and shall
not be subject to any defense or setoff, counterclaim, recoupment or termination
whatsoever, by reason of the invalidity, illegality or unenforceability of the
Obligations, any impossibility in the performance of the Obligations or
otherwise.
9.4 Extensions and Other Modifications of Obligations. The Lenders and
Issuing Banks, either themselves or acting through the Agents, are authorized,
without notice or demand and without affecting the liability of any Guarantor
hereunder, from time to time, (a) to renew, extend, accelerate or otherwise
change the time for payment of, or other terms relating to, all or any part of
the Obligations, or to otherwise modify, amend or change the terms of any of the
Loan Documents; (b) to accept partial payments on all or any part of the
Obligations; (c) to take and hold security or collateral for the payment of all
or any part of the Obligations, this Guarantee, or any other guaranties of all
or any part of the Obligations, (d) to exchange, enforce,
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waive and release any such security or collateral; (e) to apply such security or
collateral and direct the order or manner of sale thereof as in their discretion
they may determine; or (f) to settle, release, exchange, enforce, waive,
compromise or collect or otherwise liquidate all or any part of the Obligations,
this Guarantee, any other guaranty of all or any part of the Obligations, and
any security or collateral for the Obligations or for any such guaranty.
9.5 No Marshalling; Reinstatement of Guarantee. The Guarantors consent and
agree that none of the Lenders, Issuing Banks nor any Agent nor any Person
acting for or on behalf of the Lenders, Issuing Banks or any Agent shall be
under any obligation to marshall any assets in favor of any Guarantor or against
or in payment of any or all of the Obligations. The Guarantors further agree
that, to the extent that any Borrower, any Guarantor or any other guarantor of
all or any part of the Obligations makes a payment or payments to any Lender,
any Issuing Bank or any Agent, or any Lender, any Issuing Bank or any Agent
receives any proceeds of collateral for all or any part of the Obligations,
which payment or payments or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to such Borrower, such Guarantor, such other guarantor or any other
Person, or their respective estates, trustees, receivers or any other party,
under any bankruptcy law, state or federal law, common law or equitable cause,
then, to the extent of such payment or repayment, the part of the Obligations
which has been paid, reduced or satisfied by such amount shall be reinstated and
continued in full force and effect as of the time immediately preceding such
initial payment, reduction or satisfaction.
9.6 Agreement to Pay Obligations; Currency Issues. In furtherance of the
foregoing and not in limitation of any other right which the Administrative
Agent or any Lender may have at law or in equity against the Guarantors by
virtue hereof, upon the failure of any Borrower to pay any of the Obligations
when and as the same shall become due, whether at maturity, by acceleration,
after notice of prepayment or otherwise, each Guarantor promises to and will,
upon receipt of written demand by the Administrative Agent, forthwith pay, or
cause to be paid, in cash, the amount of such unpaid Obligations; provided,
however, the payment Obligations hereunder by each Guarantor which is a
Subsidiary Borrower shall be limited to the Obligations of the Subsidiary
Borrowers. The Guarantors further agree, jointly and severally, that if payment
in respect of any of the Obligations owed to any Agent, any Lender or any
Issuing Bank shall be due in a currency other than Dollars and/or at a place of
payment other than Indianapolis, Indiana and if, by reason of any Change,
disruption of currency or foreign exchange markets, war or civil disturbance or
other event, payment of such Obligations in such currency or such place of
payment shall be impossible or, in the judgment of such Lender, Agent or Issuing
Bank, not consistent with the protection of its rights or interests, then, at
the election of such Lender, Agent or Issuing Bank, the Guarantors shall make
payment of such Obligation in Dollars (based upon the applicable Exchange Rate
in effect on the date of payment) and/or in Indianapolis, Indiana, and shall
indemnify such Lender or Issuing Bank against any losses or expenses that it
shall sustain as a result of such alternative payment.
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9.7 Subordination of Subrogation. Until the Obligations have been
indefeasibly paid in full in cash, the Guarantors (i) shall have no right of
subrogation with respect to such Obligations and (ii) waive any right to enforce
any remedy which the Lenders, Issuing Banks or the Agents (or any of them) now
have or may hereafter have against any Borrower, any endorser or any guarantor
of all or any part of the Obligations or any other Person, and the Guarantors
waive any benefit of, and any right to participate in, any security or
collateral given to the Lenders, the Issuing Banks and the Agents (or any of
them) to secure the payment or performance of all or any part of the Obligations
or any other liability of the Borrowers and the Subsidiary Borrowers to the
Lenders or Issuing Banks. Should any Guarantor have the right, notwithstanding
the foregoing to exercise its subrogation rights, except as set forth in Section
9.9, each Guarantor hereby expressly and irrevocably subordinates to payment of
the Secured Obligations any and all rights at law or in equity to subrogation,
reimbursement, exoneration, contribution, indemnification or set off and any and
all defenses available to a surety, guarantor or accommodation co-obligor until
the Secured Obligations are indefeasibly paid in full in cash. Each Guarantor
acknowledges and agrees that this subordination is intended to benefit the
Agents, the Lenders and the other Holders of Secured Obligations and shall not
limit or otherwise affect such Guarantor's liability hereunder or the
enforceability of this Article IX, and that Agents, the Lenders and their
respective successors and assigns are intended third party beneficiaries of the
waivers and agreements set forth in this Section 9.7.
9.8 Election of Remedies. If any Agent or any Lender may, under applicable
law, proceed to realize its benefits under any of the Loan Documents giving any
Agent or such Lender a Lien upon any Collateral, whether owned by any Borrower
or by any other Person, either by judicial foreclosure or by non-judicial sale
or enforcement, any Agent or any Lender may, at its sole option, determine which
of its remedies or rights it may pursue without affecting any of its rights and
remedies under this Article IX. If, in the exercise of any of its rights and
remedies, any Agent or any Lender shall forfeit any of its rights or remedies,
including its right to enter a deficiency judgment against any Borrower or any
other Person, whether because of any applicable laws pertaining to "election of
remedies" or the like, each Guarantor hereby consents to such action by such
Agent or such Lender and waives any claim based upon such action, even if such
action by such Agent or such Lender shall result in a full or partial loss of
any rights of subrogation which each Guarantor might otherwise have had but for
such action by such Agent or such Lender. Any election of remedies which results
in the denial or impairment of the right of any Agent or any Lender to seek a
deficiency judgment against any Borrower or any other Guarantor shall not impair
any other Guarantor's obligation to pay the full amount of the Obligations
guaranteed by it under this Article IX. In the event any Agent or any Lender
shall bid at any foreclosure or trustee's sale or at any private sale permitted
by law or the Loan Documents, any Agent or any Lender may bid all or less than
the amount of the Obligations and the amount of such bid need not be paid by
such Agent or such Lender but shall be credited against the Obligations. The
amount of the successful bid at any such sale, whether by any Agent, any Lender
or any other party is the successful bidder, shall be conclusively deemed to be
the fair market value of the Collateral and the difference between such bid
amount and the
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remaining balance of the Obligations shall be conclusively deemed to be the
amount of the Obligations guaranteed under this Article IX (subject to the
limitations contained in Section 9.1 with respect to the Obligations guaranteed
by the non-U.S. Guarantors), notwithstanding that any present or future law or
court decision or ruling may have the effect of reducing the amount of any
deficiency claim to which any Agent or any Lender might otherwise be entitled
but for such bidding at any such sale.
9.9 Limitation. Notwithstanding any provision herein contained to the
contrary, each Guarantor's liability under this Article IX (which liability is
in any event in addition to amounts for which such entity may be primarily
liable as a Borrower or otherwise) shall be limited to an amount not to exceed
as of any date of determination the greater of:
(a) the net amount of all Loans advanced to any other Borrower under
this Agreement and then re-loaned or otherwise transferred to, or for the
benefit of, such Guarantor; and
(b) the amount which could be claimed by the Agents and the Lenders
from such Guarantor under this Article IX without rendering such claim
voidable or avoidable under Section 548 of Chapter 11 of the Bankruptcy
Code or under any applicable state Uniform Fraudulent Transfer Act,
Uniform Fraudulent Conveyance Act or similar statute or common law after
taking into account, among other things, such Guarantor's right of
contribution and indemnification from each other Guarantor under Section
9.9.
9.9 Contribution with Respect to Guaranty Obligations.
(a) To the extent that any Guarantor shall make a payment under this
Article IX of all or any of the Secured Obligations (other than Loans made to
that Guarantor as a Borrower for which it is primarily liable) (a "Guarantor
Payment") which, taking into account all other Guarantor Payments then
previously or concurrently made by any other Guarantor, exceeds the amount
which such Guarantor would otherwise have paid if each Guarantor had paid the
aggregate Obligations satisfied by such Guarantor Payment in the same
proportion that such Guarantor's "Allocable Amount" (as defined below) (as
determined immediately prior to such Guarantor Payment) bore to the aggregate
Allocable Amounts of each of the Guarantors as determined immediately prior to
the making of such Guarantor Payment, then, following indefeasible payment in
full in cash of the Obligations and termination of the Commitments, such
Guarantor shall be entitled to receive contribution and indemnification
payments from, and be reimbursed by, each other Guarantor for the amount of
such excess, pro rata based upon their respective Allocable Amounts in effect
immediately prior to such Guarantor Payment.
(b) As of any date of determination, the "Allocable Amount" of any
Guarantor shall be equal to the maximum amount of the claim which could then
be recovered from such Guarantor under this Article IX without rendering such
claim voidable or avoidable under
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Section 548 of Chapter 11 of the Bankruptcy Code or under any applicable state
Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar
statute or common law.
(c) This Section 9.9 is intended only to define the relative rights of
the Guarantors and nothing set forth in this Section 9.9 is intended to or shall
impair the obligations of the Guarantors, jointly and severally, to pay any
amounts as and when the same shall become due and payable in accordance with the
terms of this Agreement, including Section 9.1. Nothing contained in this
Section 9.9 shall limit the liability of any Borrower to pay the Loans made
directly or indirectly to that Borrower and accrued interest, fees and expenses
with respect thereto for which such Borrower shall be primarily liable.
(d) The parties hereto acknowledge that the rights of contribution and
indemnification hereunder shall constitute assets of the Guarantor to which such
contribution and indemnification is owing.
(e) The rights of the indemnifying Guarantors against other Borrowers
or Guarantors under this Section 9.9 shall be exercisable upon the full and
indefeasible payment of the Secured Obligations and the termination of the
Commitments.
9.10 Liability Cumulative. The liability of the Guarantors under this
Article IX is in addition to and shall be cumulative with all liabilities of
each Guarantor or Borrower to the Agents and the Lenders under this Agreement
and the other Loan Documents to which such Guarantor or Borrower is a party or
in respect of any Obligations or obligation of any other Guarantor or Borrower,
without any limitation as to amount, unless the instrument or agreement
evidencing or creating such other liability specifically provides to the
contrary.
9.11 No Revocation; Term of Guarantee. This Guarantee shall continue in
full force and effect and may not be terminated or otherwise revoked until the
Secured Obligations shall have been fully and indefeasibly paid (in cash) and
discharged and this Agreement and all financing arrangements among the
Borrowers, the Subsidiary Borrowers, the Guarantors, the Lenders, the Agents and
the Issuing Lenders shall have been terminated. If, notwithstanding the
foregoing, the Guarantors (or any of them) shall have any right under applicable
law to terminate or revoke this Guarantee, the Guarantors agree that such
termination or revocation shall not be effective until a written notice of such
revocation or termination, specifically referring hereto, signed by the
Guarantors, is actually received by the Administrative Agent. Such notice shall
not affect the right and power of any of the Lenders, any of the Issuing Lenders
or any Agent to enforce rights arising prior to receipt thereof by the
Administrative Agent. If any Lender or any Agent grants loans or takes other
action, or any Issuing Bank issues Facility Letters of Credit, after a Guarantor
terminates or revokes this Guarantee but before the Administrative Agent
receives such written notice, the rights of such Lender or Issuing Bank with
respect thereto shall be the same as if such termination or revocation had not
occurred. The provisions of this Article IX
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shall remain in full force and effect, notwithstanding any termination of this
Agreement, until the Secured Obligations shall have been fully and indefeasibly
paid (in cash) and discharged.
ARTICLE X: GENERAL PROVISIONS
10.1 Survival of Representations. All representations and warranties of the
Borrowers and Guarantors contained in this Agreement shall survive delivery of
the Notes and the making of the Loans herein contemplated.
10.2 Governmental Regulation. Anything contained in this Agreement to the
contrary notwithstanding, no Lender shall be obligated to extend credit to the
Borrowers and neither the Administrative Agent nor any Issuing Lender shall be
obligated to issue any Facility Letter of Credit for the account of any Borrower
in violation of any limitation or prohibition provided by any applicable statute
or regulation.
10.3 Performance of Obligations. Each of the Borrowers agrees that the
Administrative Agent may, but shall have no obligation to (i) at any time, pay
or discharge taxes, liens, security interests or other encumbrances levied or
placed on or threatened against any Collateral and (ii) after the occurrence and
during the continuance of a Default make any other payment or perform any act
required of any Borrower under any Loan Document or take any other action which
the Administrative Agent in its discretion deems necessary or desirable to
protect or preserve the Collateral, including, without limitation, any action to
(y) effect any repairs or obtain any insurance called for by the terms of any of
the Loan Documents and to pay all or any part of the premiums therefor and the
costs thereof and (z) pay any rents payable by any Borrower which are more than
30 days past due, or as to which the landlord has given notice of termination,
under any lease. The Administrative Agent shall use its best efforts to give the
applicable Borrower notice of any action taken under this Section 10.3 prior to
the taking of such action or promptly thereafter provided the failure to give
such notice shall not affect the applicable Borrower's obligations in respect
thereof. Each of the Borrowers agrees to pay the Administrative Agent, upon
demand, the principal amount of all funds advanced by the Administrative Agent
under this Section 10.3, together with interest thereon at the rate from time to
time applicable to Base Rate Loans from the date of such advance until the
outstanding principal balance thereof is paid in full. If any Borrower fails to
make payment in respect of any such advance under this Section 10.3 within one
(1) Business Day after the date such Borrower receives written demand therefor
from the Administrative Agent, the Administrative Agent shall promptly notify
each Lender and each Lender agrees that it shall thereupon make available to the
Administrative Agent, in Dollars in immediately available funds, the amount
equal to such Lender's Pro Rata Share of such advance. If such funds are not
made available to the Administrative Agent by such Lender within one (1)
Business Day after the Administrative Agent's demand therefor, the
Administrative Agent will be entitled to recover any such amount from such
Lender together with interest thereon at the Effective Federal Funds Rate for
each day
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during the period commencing on the date of such demand and ending on the date
such amount is received. The failure of any Lender to make available to the
Administrative Agent its Pro Rata Share of any such unreimbursed advance under
this Section 10.3 shall neither relieve any other Lender of its obligation
hereunder to make available to the Administrative Agent such other Lender's Pro
Rata Share of such advance on the date such payment is to be made nor increase
the obligation of any other Lender to make such payment to the Administrative
Agent. All outstanding principal of, and interest on, advances made under this
Section 10.3 shall constitute Obligations secured by the Collateral until paid
in full by the Borrowers.
10.4 Headings. Section headings in the Loan Documents are for convenience
of reference only, and shall not govern the interpretation of any of the
provisions of the Loan Documents.
10.5 Entire Agreement. The Loan Documents embody the entire agreement and
understanding among the Borrowers, the Guarantors, the Administrative Agent, the
Syndication Agent and the Lenders and supersede all prior agreements and
understandings relating to the subject matter thereof. Upon the Closing Date,
the terms of this Agreement shall be the operative terms and the Original Credit
Agreement shall have no further force and effect.
10.6 Several Obligations; Benefits of this Agreement. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other. The failure of any Lender to perform
any of its obligations hereunder shall not relieve any other Lender from any of
its obligations hereunder. This Agreement shall not be construed so as to confer
any right or benefit upon any Person other than the parties to this Agreement
and their respective successors and assigns.
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10.7 Expenses; Indemnification
(A) Expenses. The Borrowers shall reimburse the Agents and the Arranger
for any reasonable costs, internal charges and out-of-pocket expenses (including
attorneys' and paralegals' fees and time charges of attorneys and paralegals for
any Agent or the Arranger, which attorneys and paralegals may be employees of
any Agent or the Arranger) paid or incurred by any Agent or Arranger in
connection with the preparation, negotiation, execution, delivery, syndication,
review, amendment, modification, and administration of the Loan Documents. Each
of the Borrowers also agrees to reimburse the Agents, the Lenders and the
Issuing Lenders for any costs, internal charges and out-of-pocket expenses
(including attorneys' and paralegals' fees and time charges of attorneys and
paralegals for the Agents, the Lenders and the Issuing Lenders, which attorneys
and paralegals may be employees of any Agent, the Lenders or the Issuing
Lenders) paid or incurred by any Agent, any Lender or any Issuing Lender in
connection with the collection of the Obligations and enforcement of the Loan
Documents. In addition to expenses set forth above, each of the Borrowers agrees
to reimburse the Administrative Agent, promptly after the request therefor, for
each audit, collateral analysis or other business analysis performed by or for
the benefit of the Lenders in connection with this Agreement or the other Loan
Documents in an amount equal to the Administrative Agent's then customary
charges for each person employed to perform such audit or analysis, plus all
costs and expenses (including without limitation, travel expenses) incurred by
the Administrative Agent in the performance of such audit or analysis; provided,
however, the Borrowers shall not be obligated to so reimburse the Administrative
Agent during any period of 12 consecutive months in an amount in excess of
$8,000 for such audits, collateral analyses or other business analyses conducted
at a time when no Default or Unmatured Default has occurred and is continuing.
The Administrative Agent shall provide the Borrowers with a detailed statement
of all reimbursements requested under this Section 10.7(A).
(B) Indemnity. Each of the Borrowers and Guarantors further agrees to
defend, protect, indemnify, and hold harmless the Agents, the Arranger, each and
all of the Lenders, each and all of the Issuing Lenders, the Swing Loan Lender
and each of their respective Affiliates, and each of such Agent's, Arranger's,
Lender's, Issuing Lender's or Affiliate's respective officers, directors,
employees, attorneys and agents (including, without limitation, those retained
in connection with the satisfaction or attempted satisfaction of any of the
conditions set forth in Article IV) (collectively, the "Indemnitees") from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, claims, costs, expenses of any kind or nature
whatsoever (including, without limitation, the fees and disbursements of counsel
for such Indemnitees in connection with any investigative, administrative or
judicial proceeding, whether or not such Indemnitees shall be designated a party
thereto), imposed on, incurred by, or asserted against such Indemnitees in any
manner relating to or arising out of:
(i) this Agreement, the other Loan Documents, or any act, event or
transaction related or attendant thereto or to the Stock Acquisition, the
making of the Loans, and the
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issuance of and participation in Letters of Credit hereunder, the
management of such Loans or Letters of Credit, the use or intended use of
the proceeds of the Loans or Letters of Credit hereunder, or any of the
other transactions contemplated by the Loan Documents; or
(ii) any liabilities, obligations, responsibilities, losses, damages,
personal injury, death, punitive damages, economic damages, consequential
damages, treble damages, intentional, willful or wanton injury, damage or
threat to the environment, natural resources or public health or welfare,
costs and expenses (including, without limitation, attorney, expert and
consulting fees and costs of investigation, feasibility or remedial action
studies), fines, penalties and monetary sanctions, interest, direct or
indirect, known or unknown, absolute or contingent, past, present or future
relating to violation of any Environmental, Health or Safety Requirements
of Law arising from or in connection with the past, present or future
operations of Brightpoint, its Subsidiaries or any of their respective
predecessors in interest, or, the past, present or future environmental,
health or safety condition of any respective property of Brightpoint or its
Subsidiaries, the presence of asbestos-containing materials at any
respective property of Brightpoint or its Subsidiaries or the Release or
threatened Release of any Contaminant into the environment (collectively,
the "Indemnified Matters");
provided, however, the Borrowers and Guarantors shall have no obligation to an
Indemnitee hereunder with respect to (i) Indemnified Matters caused solely by or
resulting solely from the willful misconduct or Gross Negligence of such
Indemnitee, as determined by the final non-appealable judgment of a court of
competent jurisdiction or (ii) Indemnified Matters arising solely out of a
dispute between the Agents or a dispute between any Lender and any Agent. If the
undertaking to indemnify, pay and hold harmless set forth in the preceding
sentence may be unenforceable because it is violative of any law or public
policy, the Borrowers and Guarantors shall contribute the maximum portion which
it is permitted to pay and satisfy under applicable law, to the payment and
satisfaction of all Indemnified Matters incurred by the Indemnitees.
(C) Waiver of Certain Claims; Settlement of Claims. Each of the Borrowers
and each of the Guarantors agrees to assert no claim against any of the
Indemnitees on any theory of liability for consequential damages, indirect
damages, exemplary damages, punitive damages or any other similar theory of
damages howsoever categorized. No settlement shall be entered into by
Brightpoint or any if its Subsidiaries with respect to any claim, litigation,
arbitration or other proceeding relating to or arising out of the transaction
evidenced by this Agreement or the other Loan Documents(whether or not any
Agent, any Lender, any Issuing Lender or any Indemnitee is a party thereto)
unless such settlement releases all Indemnitees from any and all liability with
respect thereto.
(D) Survial of Agreements. The obligations and agreements of the Borrowers
and Guarantors under this Section 10.7 shall survive the termination of this
Agreement.
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10.8 Numbers of Documents. All statements, notices, closing documents, and
requests hereunder shall be furnished to the Administrative Agent with
sufficient counterparts so that the Administrative Agent may furnish one to each
of the Lenders.
10.9 Accounting. Except as provided to the contrary herein, all accounting
terms used herein shall be interpreted and all accounting determinations
hereunder shall be made in accordance with Agreement Accounting Principles.
10.10 Severability of Provisions. Any provision in any Loan Document that
is held to be inoperative, unenforceable, or invalid in any jurisdiction shall,
as to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
10.11 Nonliability of Lenders. The relationship among the Borrowers and the
Lenders, Issuing Lenders, the Swing Line Lender and the Agents shall be solely
that of borrower and lender. Neither any Agent nor any Lender nor any Issuing
Lender shall have any fiduciary responsibilities to the Borrowers or to the
Guarantors. Neither any Agent, nor any Lender, nor any Issuing Lender undertakes
any responsibility to the Borrowers or the Guarantors to review or inform the
Borrowers or Guarantors of any matter in connection with any phase of the
Borrowers' or Guarantors' business or operations.
10.12 GOVERNING LAW. THE ADMINISTRATIVE AGENT ACCEPTS THIS AGREEMENT, ON
BEHALF OF ITSELF, THE OTHER AGENTS, THE LENDERS AND THE ISSUING LENDERS, AT
CHICAGO, ILLINOIS BY ACKNOWLEDGING AND AGREEING TO IT THERE. THIS AGREEMENT
SHALL BE GOVERNED BY AND INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE
INTERNAL LAWS (INCLUDING 735 ILCS 105/5-1 ET SEQ. BUT OTHERWISE WITHOUT REGARD
TO THE CONFLICTS OF LAWS PROVISIONS) OF THE STATE OF ILLINOIS. WITHOUT LIMITING
THE FOREGOING, ANY DISPUTE BETWEEN ANY BORROWER OR ANY GUARANTOR AND ANY AGENT,
ANY LENDER, ANY ISSUING LENDER OR ANY OTHER HOLDER OF SECURED OBLIGATIONS
ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP
ESTABLISHED BETWEEN THEM IN CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS, AND WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE,
SHALL BE RESOLVED IN ACCORDANCE WITH THE INTERNAL LAWS (INCLUDING 735 ILCS
105/5-1 ET SEQ. BUT OTHERWISE WITHOUT REGARD TO THE CONFLICTS OF LAWS
PROVISIONS) OF THE STATE OF ILLINOIS.
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10.13 CONSENT TO JURISDICTION; SERVICE OF PROCESS; JURY TRIAL
(A) EXCLUSIVE JURISDICTION. EXCEPT AS PROVIDED IN SUBSECTION (B), EACH OF
THE PARTIES HERETO AGREES THAT ALL DISPUTES AMONG THEM ARISING OUT OF, CONNECTED
WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN
CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS WHETHER
ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED EXCLUSIVELY
BY STATE OR FEDERAL COURTS LOCATED IN CHICAGO, ILLINOIS, BUT THE PARTIES HERETO
ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT
LOCATED OUTSIDE OF CHICAGO, ILLINOIS. EACH OF THE PARTIES HERETO WAIVES IN ALL
DISPUTES BROUGHT PURSUANT TO THIS SUBSECTION (A) ANY OBJECTION THAT IT MAY HAVE
TO THE LOCATION OF THE COURT CONSIDERING THE DISPUTE.
(B) OTHER JURISDICTIONS. EACH OF THE BORROWERS AND GUARANTORS AGREES THAT
ANY AGENT, ANY LENDER, ANY ISSUING LENDER OR ANY HOLDER OF SECURED OBLIGATIONS
SHALL HAVE THE RIGHT TO PROCEED AGAINST ANY BORROWER OR ANY GUARANTOR OR ANY
BORROWER'S OR GUARANTOR'S PROPERTY IN A COURT IN ANY LOCATION TO ENABLE SUCH
PERSON TO (1) OBTAIN PERSONAL JURISDICTION OVER SUCH BORROWER OR GUARANTOR OR
(2) REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE SECURED OBLIGATIONS
OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER ENTERED IN FAVOR OF SUCH PERSON.
EACH OF THE BORROWERS AND GUARANTORS AGREES THAT IT WILL NOT ASSERT ANY
PERMISSIVE COUNTERCLAIMS IN ANY PROCEEDING BROUGHT UNDER THIS CLAUSE (B) BY SUCH
PERSON TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE OBLIGATIONS OR
TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF SUCH PERSON ALL OF WHICH
PERMISSIVE COUNTERCLAIMS MAY BE BROUGHT ONLY IN THE JURISDICTION SET FORTH IN
CLAUSE (A) ABOVE. EACH OF THE BORROWERS AND GUARANTORS WAIVES ANY OBJECTION THAT
IT MAY HAVE TO THE LOCATION OF THE COURT IN WHICH SUCH PERSON HAS COMMENCED A
PROCEEDING DESCRIBED IN THIS SUBSECTION (B).
(C) SERVICE OF PROGRESS; VENUE. EACH OF THE BORROWERS AND GUARANTORS WAIVES
PERSONAL SERVICE OF PROCESS UPON IT AND, AS ADDITIONAL SECURITY FOR THE SECURED
OBLIGATIONS, IRREVOCABLY APPOINTS CT CORPORATION SYSTEM THEIR AGENT FOR THE
PURPOSE OF ACCEPTING SERVICE OF PROCESS ISSUED BY ANY COURT. EACH OF THE
BORROWERS AND GUARANTORS IRREVOCABLY WAIVES ANY OBJECTION (INCLUDING, WITHOUT
LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED ON THE GROUNDS OF
FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
SUCH ACTION OR PROCEEDING
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WITH RESPECT TO THIS AGREEMENT OR ANY OTHER INSTRUMENT,
DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH IN ANY
JURISDICTION SET FORTH ABOVE.
(D) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES
ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING
IN CONTRACT, TORT, OR OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS
AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED
IN CONNECTION HEREWITH. EACH OF THE PARTIES HERETO AGREES AND CONSENTS THAT ANY
SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY AND THAT ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A
COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
(E) WAIVER OF BOND. EACH OF THE BORROWERS AND GUARANTORS WAIVES THE
POSTING OF ANY BOND OTHERWISE REQUIRED OF ANY PARTY HERETO IN CONNECTION WITH
ANY JUDICIAL PROCESS OR PROCEEDING TO REALIZE ON THE COLLATERAL OR ANY OTHER
SECURITY FOR THE OBLIGATIONS OR TO ENFORCE ANY JUDGMENT OR OTHER COURT ORDER
ENTERED IN FAVOR OF SUCH PARTY, OR TO ENFORCE BY SPECIFIC PERFORMANCE, TEMPORARY
RESTRAINING ORDER, PRELIMINARY OR PERMANENT INJUNCTION, THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT.
(F) ADVICE OF COUNSEL. EACH OF THE PARTIES REPRESENTS TO EACH OTHER PARTY
HERETO THAT IT HAS DISCUSSED THIS AGREEMENT AND, SPECIFICALLY, THE PROVISIONS OF
THIS SECTION 10.13, WITH ITS COUNSEL.
10.14 Subordination of Intercompany Indebtedness. Each of the Borrowers
and Guarantors agrees that any and all claims of such Borrower or Guarantor
against any other Borrower, any Guarantor, any endorser, obligor or any other
guarantor of all or any part of the Secured Obligations, or against any of its
properties shall be subordinate and subject in right of payment to the prior
payment, in full and in cash, of all Secured Obligations. Notwithstanding any
right of any Borrower or Guarantor to ask, demand, sue for, take or receive any
payment from any other Borrower or any Guarantor, all rights, liens and security
interests of any Borrower or Guarantor, whether now or hereafter arising and
howsoever existing, in any assets of any other Borrower or any Guarantor
(whether constituting part of Collateral given to any Holder of Secured
Obligations or the Agent to secure payment of all or any part of the Secured
Obligations
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or otherwise) shall be and are subordinated to the rights of the Holders of
Secured Obligations and the Agent in those assets. No Borrower or Guarantor
shall have any right to possession of any such asset or to foreclose upon any
such asset, whether by judicial action or otherwise, unless and until all of
the Secured Obligations (other than contingent indemnity obligations) shall
have been fully paid and satisfied and all financing arrangements among the
Borrowers, Guarantors and the Holders of Secured Obligations have been
terminated. If all or any part of the assets of any Borrower or Guarantor, or
the proceeds thereof, are subject to any distribution, division or application
to the creditors of such Borrower or Guarantor, whether partial or complete,
voluntary or involuntary, and whether by reason of liquidation, bankruptcy,
arrangement, receivership, assignment for the benefit of creditors or any other
action or proceeding, or if the business of any Borrower or Guarantor is
dissolved or if substantially all of the assets of any Borrower or Guarantor
are sold, then, and in any such event, any payment or distribution of any kind
or character, either in cash, securities or other property, which shall be
payable or deliverable upon or with respect to any indebtedness of any such
Borrower or Guarantor to any other Borrower or Guarantor ("Intercompany
Indebtedness") shall be paid or delivered directly to the Administrative Agent
for application on any of the Secured Obligations, due or to become due, until
such Secured Obligations (other than contingent indemnity obligations) shall
have first been fully paid and satisfied. The Borrowers and the Guarantors
irrevocably authorize and empower the Administrative Agent to demand, sue for,
collect and receive every such payment or distribution and give acquittance
therefor and to make and present for and on behalf of the applicable Borrower
or Guarantor such proofs of claim and take such other action, in the
Administrative Agent's own name or in the name of the applicable Borrower or
Guarantor or otherwise, as the Administrative Agent may deem necessary or
advisable for the enforcement of this Section 10.14. The Administrative Agent
may vote such proofs of claim in any such proceeding, receive and collect any
and all dividends or other payments or disbursements made thereon in whatever
form the same may be paid or issued and apply the same on account of any of the
Secured Obligations. Should any payment, distribution, security or instrument
or proceeds thereof be received by any Borrower or Guarantor upon or with
respect to the Intercompany Indebtedness prior to the satisfaction of all of
the Secured Obligations (other than contingent indemnity obligations) and the
termination of all financing arrangements among the Borrowers, the Guarantors
and the Holders of Secured Obligations, the applicable Borrower or Guarantor
shall receive and hold the same in trust, as trustee, for the benefit of the
Holders of Secured Obligations and shall forthwith deliver the same to the
Administrative Agent, for the benefit of the Holders of Secured Obligations, in
precisely the form received (except for the endorsement or assignment of the
Borrower where necessary), for application to any of the Secured Obligations,
due or not due, and, until so delivered, the same shall be held in trust by the
Borrower or Guarantor, as applicable, as the property of the Holders of Secured
Obligations. If any Borrower or Guarantor fails to make any such endorsement or
assignment to the Agent, the Agent or any of its officers or employees are
irrevocably authorized to make the same. The Borrowers and Guarantors agree
that until the Secured Obligations (other than the contingent indemnity
obligations) have been paid in full (in cash) and satisfied and all financing
arrangements among the Borrowers, Guarantors and the Holders of Secured
Obligations have
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been terminated, the Borrowers and Guarantors will not assign or transfer to any
Person (other than the Administrative Agent) any claim such Borrower or
Guarantor has or may have against any other Borrower or Guarantor.
10.15 No Strict Construction. The parties hereto have participated jointly
in the negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties hereto and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of the authorship
of any provisions of this Agreement.
ARTICLE XI: THE ADMINISTRATIVE AGENT
11.1 Appointment; Nature of Relationship. NBD is appointed by the Lenders
(each reference in this Article XI to a Lender being in its capacity either as a
Lender or an Issuing Lender or a Swing Line Lender, or any or all of the
foregoing) as the Administrative Agent hereunder and under each other Loan
Document, and each of the Lenders irrevocably authorizes the Administrative
Agent to act as the contractual representative of such Lender with the rights
and duties expressly set forth herein and in the other Loan Documents. The
Administrative Agent agrees to act as such contractual representative upon the
express conditions contained in this Article XI. Notwithstanding the use of the
defined term "Administrative Agent," it is expressly understood and agreed that
the Administrative Agent shall not have any fiduciary responsibilities to any
Lender by reason of this Agreement and that the Administrative Agent is merely
acting as the representative of the Lenders with only those duties as are
expressly set forth in this Agreement and the other Loan Documents. In its
capacity as the Lenders' contractual representative, the Administrative Agent
(i) does not assume any fiduciary duties to any of the Lenders, (ii) is a
"representative" of the Lenders within the meaning of Section 9-105 of the
Uniform Commercial Code and (iii) is acting as an independent contractor, the
rights and duties of which are limited to those expressly set forth in this
Agreement and the other Loan Documents. Each of the Lenders agrees to assert no
claim against the Administrative Agent on any agency theory or any other theory
of liability for breach of fiduciary duty, all of which claims each Lender
waives.
11.2 Powers. The Administrative Agent shall have and may exercise such
powers under the Loan Documents as are specifically delegated to the
Administrative Agent by the terms of each thereof, together with such powers as
are reasonably incidental thereto. The Administrative Agent shall have no
implied duties or fiduciary duties to the Lenders, or any obligation to the
Lenders to take any action hereunder or under any of the other Loan Documents
except any action specifically provided by the Loan Documents required to be
taken by the Administrative Agent.
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11.3 General Immunity. Neither the Administrative Agent nor any of its
respective directors, officers, agents or employees shall be liable to either of
the Borrowers, the Guarantors, the Lenders or any Lender for any action taken or
omitted to be taken by it or them hereunder or under any other Loan Document or
in connection herewith or therewith except to the extent such action or inaction
is found in a final non-appealable judgment by a court of competent jurisdiction
to have arisen solely from the Gross Negligence or willful misconduct of such
Person.
11.4 No Responsibility for Loans, Creditworthiness, Collateral, Recitals,
Etc. Neither the Administrative Agent nor any of its respective directors,
officers, agents or employees shall be responsible for or have any duty to
ascertain, inquire into, or verify (i) any statement, warranty or representation
made in connection with any Loan Document or any borrowing hereunder; (ii) the
performance or observance of any of the covenants or agreements of any obligor
under any Loan Document; (iii) the satisfaction of any condition specified in
Article IV; (iv) the existence or possible existence of any Default or (v) the
validity, effectiveness or genuineness of any Loan Document or any other
instrument or writing furnished in connection therewith. The Administrative
Agent shall not be responsible to any Lender for any recitals, statements,
representations or warranties herein or in any of the other Loan Documents, for
the perfection or priority of any of the Liens on any of the Collateral, or for
the execution, effectiveness, genuineness, validity, legality, enforceability,
collectibility, or sufficiency of this Agreement or any of the other Loan
Documents or the transactions contemplated thereby, or for the financial
condition of any Guarantor of any or all of the Obligations, Brightpoint or any
of its Subsidiaries.
11.5 Action on Instructions of Lenders. The Administrative Agent shall in
all cases be fully protected in acting, or in refraining from acting, hereunder
and under any other Loan Document in accordance with written instructions signed
by the Required Lenders (except with respect to actions that require the consent
of all of the Lenders as provided in Section 8.3), and such instructions and any
action taken or failure to act pursuant thereto shall be binding on all of the
Lenders and on all Holders of Secured Obligations. The Administrative Agent
shall be fully justified in failing or refusing to take any action hereunder and
under any other Loan Document unless it shall first be indemnified to its
satisfaction by the Lenders pro rata against any and all liability, cost and
expense that it may incur by reason of taking or continuing to take any such
action.
11.6 Employment of Agents and Counsel. The Administrative Agent may
execute any of its duties hereunder and under any other Loan Document by or
through employees, agents, and attorneys-in-fact, and shall not be answerable to
the Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Administrative Agent shall be entitled
to advice of counsel concerning the contractual arrangement among the
Administrative Agent and the Lenders, as the case may be, and all matters
pertaining to its duties hereunder and under any other Loan Document.
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11.7 Reliance on Documents. The Administrative Agent shall be entitled to
rely upon any Note, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Administrative
Agent, which counsel may be employees of the Administrative Agent.
11.8 The Administration Agent's Reimbursement and Indemnification. The
Lenders agree to reimburse and indemnify the Administrative Agent ratably in
proportion to their respective Pro Rata Shares (i) for any amounts not
reimbursed by the Borrowers or Guarantors for which the Administrative Agent is
entitled to reimbursement or indemnification by the Borrowers or Guarantors
under the Loan Documents, (ii) for any other expenses incurred by the
Administrative Agent on behalf of the Lenders, in connection with the
preparation, execution, delivery, administration and enforcement of the Loan
Documents including as a result of a dispute among the Lenders or between any
Lender and any Agent, and (iii) for any liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind and nature whatsoever which may be imposed on, incurred by or
asserted against the Administrative Agent in any way relating to or arising out
of the Loan Documents or any other document delivered in connection therewith
or the transactions contemplated thereby, or the enforcement of any of the
terms thereof or of any such other documents, including as a result of a
dispute among the Lenders or between any Lender and any Agent, provided that no
Lender shall be liable for any of the foregoing to the extent any of the
foregoing is found in a final non-appealable judgment by a court of competent
jurisdiction to have arisen solely from the Gross Negligence or willful
misconduct of the Administrative Agent.
11.9 Rights as a Lender. With respect to its Commitments, Loans made by
it, the Notes issued to it in its individual capacity and Facility Letters of
Credit issued by it as an Issuing Lender, the Administrative Agent shall have
the same rights and powers hereunder and under any other Loan Document as any
Lender and may exercise the same as through it were not the Administrative
Agent, and the term "Lender" or "Lenders" or "Issuing Lender" or "Issuing
Lenders", as applicable, shall, unless the context otherwise indicates, include
the Administrative Agent in its individual capacity. The Administrative Agent
may accept deposits from, lend money to, enter into Hedging Agreements and
generally engage in any kind of trust, debt, equity or other transaction, in
addition to those contemplated by this Agreement or any other Loan Document,
with Brightpoint or any of its Subsidiaries in which such Person is not
prohibited hereby from engaging with any other Person.
11.10 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Lender and based on the financial statements prepared by Brightpoint, the
Borrowers and the Guarantors and such other documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into
this Agreement and the other Loan Documents. Each Lender also acknowledges that
it will,
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independently and without reliance upon the Administrative Agent 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 and the other Loan Documents.
11.11 Successor Administrative Agent. The Administrative Agent may resign
at any time by giving written notice thereof to the Lenders and the Borrowers.
Upon any such resignation, the Required Lenders shall have the right to appoint,
on behalf of the Borrowers and the Lenders, a successor Administrative Agent. If
no successor Administrative Agent shall have been so appointed by the Required
Lenders and shall have accepted such appointment within thirty days after the
retiring Administrative Agent's giving notice of resignation, then the retiring
Administrative Agent may appoint, on behalf of the Borrowers and the Lenders, a
successor Administrative Agent. Notwithstanding anything herein to the contrary,
so long as no Default has occurred and is continuing, each such successor
Administrative Agent shall be subject to approval by Brightpoint, which approval
shall not be unreasonably withheld. Such successor Administrative Agent shall be
a commercial bank having capital and retained earnings of at least $500,000,000.
Upon the acceptance of any appointment as the Administrative Agent hereunder by
a successor Administrative Agent, such successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations hereunder and under
the other Loan Documents. After any retiring Administrative Agent's resignation
hereunder as Administrative Agent, the provisions of this Article XI shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as the Administrative Agent hereunder and
under the other Loan Documents.
11.12 Collateral Documents. Each Lender authorizes the Administrative Agent
to enter into each of the Collateral Documents to which it is a party and to
take all action contemplated by such documents. Each Lender agrees that no
Lender shall have the right individually to seek to realize upon the security
granted by any Collateral Document, it being understood and agreed that such
rights and remedies may be exercised solely by the Administrative Agent for the
benefit of the Holders of Secured Obligations upon the terms of the Collateral
Documents.
11.13 No Duties Imposed Upon Arranger or Syndication Agent. None of the
Persons identified on the cover page to this Agreement, the signature pages to
this Agreement or otherwise in this Agreement as an "Arranger" or "Syndication
Agent" shall have any right, power, obligation, liability, responsibility or
duty under this Agreement other than those applicable to all Lenders as such.
Without limiting the foregoing, none of the Lenders identified on the cover page
to this Agreement, the signature pages to this Agreement or otherwise in this
Agreements as an "Arranger" or "Syndication Agent" shall have or be deemed to
have any fiduciary duty to or fiduciary relationship with any Lender. In
addition to the agreements set forth in Section 11.10, each of the Lenders
acknowledges that it has not relied, and will not rely,
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on any of the Lenders so identified in deciding to enter into this Agreement or
in taking or not taking action hereunder.
ARTICLE XII: SETOFF; RATABLE PAYMENTS
12.1 Setoff. In addition to, and without limitation of, any rights of the
Lenders or Issuing Lenders under applicable law, if any Default occurs and is
continuing, any indebtedness from any Lender or Issuing Lender to any of the
Borrowers or Guarantors (including all account balances, whether provisional or
final and whether or not collected or available) may be offset and applied
toward the payment of the Obligations owing to such Lender, such Issuing Lender
and the other Obligations, whether or not the Obligations, or any part hereof,
shall then be due.
12.2 Ratable Payments. If any Lender, whether by setoff or otherwise, has
payment made to it upon its Loans (other than payments received pursuant to
Sections 3.1, 3.2 or 3.4) in a greater proportion than that received by any
other Lender, such Lender agrees, promptly upon demand, to purchase a portion of
the Loans held by the other Lenders so that after such purchase each Lender will
hold its ratable proportion of Loans. If any Lender, whether in connection with
setoff or amounts which might be subject to setoff or otherwise, receives
collateral or other protection for its Obligation or such amounts which may be
subject to setoff, such Lender agrees, promptly upon demand, to take such action
necessary such that all Lenders share in the benefits of such collateral ratably
in proportion to the obligations owing to them. In case any such payment is
disturbed by legal process, or otherwise, appropriate further adjustments shall
be made.
12.3 Application of Payments. Subject to the provisions of Section 8.2, the
Administrative Agent shall, unless otherwise specified at the direction of the
Required Lenders which direction shall be consistent with the last sentence of
this Section 12.3, apply all payments and prepayments in respect of any
Obligations and all proceeds of Collateral in the following order:
(A) first, to pay interest on and then principal of any portion of the
Loans which the Administrative Agent may have advanced on behalf of any
Lender for which the Administrative Agent has not then been reimbursed by
such Lender or the Borrower or Guarantor;
(B) second, to pay interest on and then principal of any advance made
under Section 10.3 for which the Administrative Agent has not then been
paid by the Borrowers or the Guarantors or reimbursed by the Lenders;
(C) third, to pay Obligations in respect of any fees, expense
reimbursements or indemnities then due to the Administrative Agent;
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(D) fourth, to pay Obligations in respect of any fees, expenses,
reimbursements or indemnities then due to the Lenders and Issuing Lender;
(E) fifth, to pay interest due in respect of Loans and L/C
Obligations;
(F) sixth, to the ratable payment or prepayment of principal
outstanding on Loans and Reimbursement Obligations and Hedging Obligations
in such order as the Administrative Agent may determine in its sole
discretion;
(G) seventh, to provide required cash collateral if any pursuant to
Section 2.21;
and
(H) eighth, to the ratable payment of all other Obligations.
Unless otherwise designated (which designation shall only be applicable prior to
the occurrence of a Default) by the Borrowers, all principal payments in respect
of Loans shall be applied first, to repay outstanding Floating Rate Loans, and
then to repay outstanding Fixed Rate Loans with those Fixed Rate Loans which
have earlier expiring Interest Periods being repaid prior to those which have
later expiring Interest Periods. The order of priority set forth in this Section
12.3 and the related provisions of this Agreement are set forth solely to
determine the rights and priorities of the Administrative Agent, the Lenders,
the Issuing Lender and other Holders of Secured Obligations as among themselves.
The order of priority set forth in clauses (D) through (H) of this Section 12.3
may at any time and from time to time be changed by the Required Lenders without
necessity of notice to or consent of or approval by the Borrowers, the
Guarantors, or any other Person. The order of priority set forth in clauses (A)
through (C) of this Section 12.3 may be changed only with the prior written
consent of the Administrative Agent. The Administrative Agent agrees that any
payment which is made by BPI by reason of its independent payment obligation to
pay the amount of the Secured Obligations pursuant to and contained in the
Pledge of Shares by and between BPI and the Administrative Agent dated April 17,
1998, shall be applied by the Administrative Agent against the Secured
Obligations as set forth in this Section 12.3.
12.4 Relations Among Lenders.
(a) Except with respect to the exercise of set-off rights of any Lender in
accordance with Section 12.1, the proceeds of which are applied in accordance
with this Agreement, and each Lender agrees that it will not take any action,
nor institute any actions or proceedings, against any Borrower, any Guarantor or
any other obligor hereunder or with respect to any Collateral or Loan Document,
without the prior written consent of the Required Lenders or, as may be provided
in this Agreement or the other Loan Documents, at the direction of the
Administrative Agent.
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(b) The Lenders are not partners or co-venturers, and no Lender shall be
liable for the acts or omissions of, or (except as otherwise set forth herein
in case of the Administrative Agent) authorized to act for, any other Lender.
ARTICLE XIII: BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
13.1 Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrowers, the
Guarantors and the Lenders and their respective successors and assigns, except
that (i) none of the Borrowers or Guarantors shall have the right to assign
their rights or obligations under the Loan Documents and (ii) any assignment by
any Lender must be made in compliance with Section 13.3 hereof. Notwithstanding
clause (ii) of this Section 13.1, any Lender may at any time, without the
consent of any Borrower, any Guarantor or the Administrative Agent, assign all
or any portion of its rights under this Agreement and Notes, if any, issued to
it to a Federal Reserve Bank; provided, however, that no such assignment shall
release the transferor Lender from its obligations hereunder. The
Administrative Agent may treat the payee of any Note issued to any individual
Lender as the owner thereof for all purposes hereof unless and until such payee
complies with Section 13.3 hereof in the case of an assignment thereof or, in
the case of any other transfer, a written notice of the transfer is filed with
the Administrative Agent. Any assignee or transferee of a Note or of an
interest in the Loans agrees by acceptance thereof to be bound by all the terms
and provisions of the Loan Documents. Any request, authority or consent of any
Person, who at the time of making such request or giving such authority or
consent is the holder of any Note, shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note or Notes
issued in exchange therefor.
13.2 Participations.
(A) Permitted Participants; Effect. Subject to the terms set forth in this
Section 13.2, any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time sell to one or more banks or other
entities ("Participants") participating interests in any Loan owing to such
Lender, any Note held by such Lender, any Commitment of such Lender, any L/C
Interest of such Lender or any other interest of such Lender under the Loan
Documents on a pro-rata or non-pro-rata basis; provided that without the prior
written consent of the Administrative Agent, the amount of such participation
shall not be for less than $5,000,000. Notice of such participation to
Brightpoint and the Administrative Agent shall be required prior to any
participation becoming effective with respect to a Participant which is not a
Lender or an Affiliate thereof. In the event of any such sale by a Lender of
participating interests to a Participant, such Lender's obligations under the
Loan Documents shall remain unchanged, such Lender shall remain solely
responsible to the other parties hereto for the performance of such
obligations, such Lender shall remain the holder of any such Note for all
purposes under the
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Loan Documents, all amounts payable by the Borrowers and Guarantors under this
Agreement shall be determined as if such Lender had not sold such participating
interests, and the Borrowers, Guarantors and the Administrative Agent shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under the Loan Documents except that, for
purposes of Article III hereof, the Participants shall be entitled to the same
rights as if they were Lenders; provided however that no Participant shall be
entitled to receive any greater payment under such Article III than the Lender
would have been entitled to receive with respect to the rights participated.
(B) Voting Rights. Each Lender shall retain the sole right to approve,
without the consent of any Participant, any amendment, modification or waiver of
any provision of the Loan Documents other than any amendment, modification or
waiver with respect to any Loan or Commitment in which such Participant has an
interest which requires the consent of all of the Lenders under Section 8.3.
(C) Benefit of Setoff. The Borrowers and the Guarantors agree that each
Participant shall be deemed to have the right of setoff provided in Section 12.1
hereof in respect to its participating interest in amounts owing under the Loan
Documents to the same extent as if the amount of its participating interest were
owing directly to it as a Lender under the Loan Documents, provided that each
Lender shall retain the right of setoff provided in Section 12.1 hereof with
respect to the amount of participating interests sold to each Participant except
to the extent such Participant exercises its right of set off. The Lenders agree
to share with each Participant, and each Participant, by exercising the right of
setoff provided in Section 12.1 hereof, agrees to share with each Lender, any
amount received pursuant to the exercise of its right of setoff, such amounts to
be shared in accordance with Section 11.2 as if each Participant were a Lender.
13.3 Assignments.
(A) Permitted Assignments. Any Lender may, in the ordinary course of its
business and in accordance with applicable law, at any time assign to one or
more banks or other entities ("Purchasers") all or a portion of its rights and
obligations under this Agreement (including, without limitation, any
Commitments, any Loans owing to it, all of its interests as Issuing Lender with
respect to Letters of Credit, all of its participation interests in Existing
Letters of Credit and Swing Line Loans, and its obligation to participate in
additional Facility Letters of Credit, Alternate Currency Credits and Swing Line
Loans hereunder) in accordance with the provisions of this Section 13.3. Such
assignment shall be substantially in the form of Exhibit H hereto and, without
the prior consent of the Administrative Agent, shall not be permitted hereunder
unless such assignment is either for all of such Lender's rights and obligations
under the Loan Documents or involves Loans and Commitments in an aggregate
amount of at least $5,000,000. Notice to the Administrative Agent and
Brightpoint and consent of Brightpoint and the Administrative Agent (which
consents will not be unreasonably withheld) shall be required prior
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to an assignment becoming effective with respect to a Purchaser which is
not a Lender or an Affiliate thereof; provided, however, no consent of
Brightpoint shall be required for any assignment to become effective at a time
when a Default has occurred and is continuing. Notwithstanding anything in this
Section 13.3 to the contrary, any Lender may at any time, without the consent of
Brightpoint or the Administrative Agent, assign all or any portion of its rights
under this Agreement to a Federal Reserve Bank; provided, however, that no such
assignment to a Federal Reserve Bank shall release the transferor Lender from
its obligations hereunder.
(B) Effect; Effective Date. Upon (i) delivery to the Administrative Agent
of a notice of assignment, substantially in the form attached as Appendix I to
Exhibit H hereto (a "Notice of Assignment"), together with any consent required
by Section 13.3(A) hereof, and (ii) payment of a $3,500 fee to the
Administrative Agent for processing such assignment, such assignment shall
become effective on the effective date specified in such Notice of Assignment.
The Notice of Assignment shall contain a representation by the Purchaser to the
effect that none of the consideration used to make the purchase of the
Commitment, Loans and L/C Obligations under the applicable assignment agreement
are "plan assets" as defined under ERISA and that the rights and interests of
the Purchaser in and under the Loan Documents will not be "plan assets" under
ERISA. On and after the effective date of such assignment, such Purchaser, if
not already a Lender, shall for all purposes be a Lender party to this Agreement
and any other Loan Documents executed by the Lenders and shall have all the
rights and obligations of a Lender under the Loan Documents, to the same extent
as if it were an original party hereto, and no consent or action by either of
the Borrowers, Guarantors or the Lenders and no further consent or action by the
Administrative Agent shall be required to release the transferor Lender with
respect to the percentage of the Commitments, Loans and Letter of Credit
participations assigned to such Purchaser. Upon the consummation of any
assignment to a Purchaser pursuant to this Section 13.3(B), if requested by the
transferor Lender or Purchaser, the transferor Lender, the Administrative Agent
and the Borrowers shall make appropriate arrangements so that replacement Notes
are issued to such transferor Lender and new Notes or, as appropriate,
replacement Notes, are issued to such Purchaser, in each case in principal
amounts reflecting their Commitments, as adjusted pursuant to such assignment
provided if no such request is made, the master Note(s) shall reflect their
Commitments, as adjusted pursuant to such assignment.
(C) The Register. The Administrative Agent shall maintain at its address
referred to in Section 14.1 a copy of each assignment delivered to and accepted
by it pursuant to this Section 13.3 and a register (the "Register") for the
recordation of the names and addresses of the Lenders and the Commitments of and
principal amount of the Loans owing to, each Lender from time to time and
whether such Lender is an original Lender or the assignee of another Lender
pursuant to an assignment under this Section 13.3. The entries in the Register
shall be conclusive and binding for all purposes, absent manifest error, and
Brightpoint and each of its Subsidiaries, the Administrative 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
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shall be available for inspection by the Borrowers or any Lender at any
reasonable time and from time to time upon reasonable prior notice.
13.4 Confidentiality. Subject to Section 13.5, the Agents and the Lenders
shall hold all nonpublic information obtained pursuant to the requirements of
this Agreement and identified as such by Brightpoint in accordance with such
Person's customary procedures for handling confidential information of this
nature and in accordance with safe and sound banking practices. Each of the
Agents and the Lenders agrees that it will not make use of any such confidential
information for personal gain or for transactions other than those contemplated
by this Agreement, except to the extent that such information (i) was or becomes
generally available to the public other than as a result of disclosure by such
Agent or such Lender, or (ii) was or becomes available on a nonconfidential
basis from a source other than Brightpoint and its Subsidiaries provided that
such source is not bound by a confidentiality agreement known to such Agent or
such Lender; provided, however, that any Agent and any Lender may disclose such
information (A) at the request or pursuant to any requirement of any
Governmental Authority to which such Agent or such Lender is subject or in
connection with an examination of such Agent or such Lender by any such
Governmental Authority; (B) pursuant to subpoena or other court process; (C)
when required to do so in accordance with the provisions of any applicable
requirement of law; (D) to the extent reasonably required in connection with any
litigation or proceeding to which any Agent, any Lender or their respective
affiliates may be party; (E) to the extent reasonably required in connection
with the exercise of any remedy hereunder or under any other Loan Document; (F)
to such Agent's or such Lender's independent auditors, accountants, attorneys
and other professional advisors; (G) to any affiliate of the Agent or such
Lender, or to any prospective Transferee, provided that such affiliate or
prospective Transferee agrees to keep such information confidential to the same
extent required of the Agents and the Lenders hereunder; and (H) as expressly
permitted under the terms of any other document or agreement regarding
confidentiality to which Brightpoint or any of its Subsidiaries is party or is
deemed party with such Agent or such Lender. In any event, the Agents and the
Lenders may make disclosure reasonably required by a prospective Transferee in
connection with the contemplated participation or assignment or as required or
requested by any Governmental Authority or representative thereof or pursuant to
legal process and shall require any such Transferee or prospective Transferee to
agree (and require any of its Transferees to agree) to comply with this Section
13.4. In no event shall any Agent or any Lender be obligated or required to
return any materials furnished by the Borrowers or Guarantors; provided,
however, each prospective Transferee shall be required to agree that if it does
not become a participant or assignee it shall return all materials furnished to
it by or on behalf of the Borrowers or Guarantors in connection with this
Agreement.
13.5 Dissemination of Information. Each of the Borrowers and Guarantors
authorizes each Lender to disclose to any Participant or Purchaser or any other
Person acquiring an interest in the Loan Documents by operation of law (each a
"Transferee") and any prospective Transferee any and all information in such
Lender's possession concerning Brightpoint and its
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Subsidiaries and the Collateral; provided that prior to any such disclosure,
such prospective Transferee shall agree to preserve in accordance with Section
13.4 the confidentiality of any confidential information described therein.
ARTICLE XIV: NOTICES
14.1 Giving Notice. Except as otherwise permitted by Section 2.11 or the
Alternate Currency Addendum with respect to borrowing notices, all notices and
other communications provided to any party hereto under this Agreement or any
other Loan Documents shall be in writing or by telex or by facsimile and
addressed or delivered to such party, with respect to any Borrower or any
Guarantor, in care of Brightpoint at the address set forth below, and for any
other party at its address set forth below its signature hereto or at such other
address as may be designated by such party in a notice to the other parties. Any
notice, if mailed and properly addressed with postage prepaid, shall be deemed
given when received; any notice, if transmitted by telex or facsimile, shall be
deemed given when transmitted (answerback confirmed in the case of telexes); or,
if by courier, one (1) Business Day after deposit with a reputable overnight
carrier services, with all charges paid. Notices to any Borrower or any
Guarantor shall be addressed as follows:
Brightpoint, Inc.
6402 Corporate Drive
Indianapolis, IN 46278
Attention: Brian D. Smith and Steven E. Fivel
Phone: 317/297-6100
Facsimile: 317/387-5479
14.2 Change of Address. Either of the Borrowers, Guarantors, the
Administrative Agent and any Lender may each change the address for service of
notice upon it by a notice in writing to the other parties hereto.
ARTICLE XV: COUNTERPARTS
This Agreement and any amendments, waivers, consents or supplements may be
executed in any number of counterparts, all of which taken together shall
constitute one agreement, and any of the parties hereto may execute this
Agreement by signing any such counterpart. Delivery of an executed signature
page hereof or thereof by facsimile transmission shall be effective as delivery
of a manually signed counterpart. This Agreement shall be effective when it has
been executed by the Borrowers, the Guarantors, the Administrative Agent and the
Lenders and each party as notified the Administrative Agent by telex or
telephone, that it has taken such action.
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IN WITNESS WHEREOF, the Borrowers, the Guarantors, the Lenders, the
Administrative Agent and the Syndication Agent have executed this Agreement as
of the date first above written.
BRIGHTPOINT, INC.
as a Borrower and Guarantor
By: /s/ Steven E. Fivel
------------------------------
Name: Steven E. Fivel
Title: E.V.P., General Counsel and
Secretary
BRIGHTPOINT INTERNATIONAL LTD.
as a Borrower and Guarantor
By: /s/ Steven E. Fivel
------------------------------
Name: Steven E. Fivel
Title: E.V.P., General Counsel and
Secretary
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NBD BANK, N.A.
as the Administrative Agent, a Lender and
the Swing Line Lender
By: /s/ Dennis L. Bassett
------------------------------
Name: Dennis L. Bassett
Title: Senior Vice President
Notice Address:
NBD Bank, N.A.
Corporate Banking
One Indiana Square
Suite 7028
Indianapolis, IN 46266
Attention: Leo G. Watson, Jr.
Telephone No.: 317/266-5937
Facsimile No.: 317/266-6042
Payment Address for Dollars: Same as above
Eurocurrency Payment Address: Same as above
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BANK ONE, INDIANA, NATIONAL ASSOCIATION
as the Syndication Agent, an Issuing
Lender and as a Lender
By: /s/ William D. Herrick
----------------------------
Name: William D. Herrick
Title: Vice President
Notice Address:
111 Monument Circle
Suite IN1-0193
Indianapolis, IN 46277-0119
Attention: Steven J. Krakoski
Telephone No.: (317) 321-8354
Facsimile No.: (317) 592-5269
Payment Address for Dollars:
ABA #074000010
Account Name: Commercial Loans
Account No.: 053 1510100263
Attention: Joe Militti
Re: Brightpoint
Eurocurrency Payment Address:
ABA # 111000614
Account Name: Brightpoint
Acount No.: 010-99-04748
Attention: Denise Matulewski,
Foreign Funding Loans
S-3
<PAGE> 142
ABN AMRO BANK N.V.
as the Alternate Currency Lender
By: /s/ Denis J. Campbell IV
------------------------------
Name: Denis J. Campbell IV
Title: Vice President
By: /s/ Joann L. Holman
------------------------------
Name: Joann L. Holman
Title: Vice President
Notice Address:
135 South LaSalle Street
Chicago, IL 60674-9135
Attention: Dennis Campbell
Telephone No.: (312) 904-2297
Facsimile No.: (312) 606-8425
S-4
<PAGE> 143
BANK BOSTON, N.A.
as a Lender
By: /s/ Janet R. Twomey
----------------------
Name: Janet R. Twomey
Title: Vice President
Notice Address:
100 Federal Street
Boston, MA 02110
Attention: Lisa Marshall
Telephone No.: (617) 434-4117
Facsimile No.: (617) 434-6685
Payment Address for Dollars:
ABA #: 011 000390
Ref: Brightpoint
Attention: Comm. Loan Svcs. Adm - $43
Eurocurrency Payment Address:
Same as Above
S-5
<PAGE> 144
CORESTATES BANK, N.A.
as a Lender
By: /s/ Dorothy T. Motz
------------------------------
Name: Dorothy T. Motz
Title: E.V.P.
Notice Address:
One North Fifth Street
Philadelphia, PA 19106
Attention: Dorothy Motz
Telephone No.: (215) 973-3529
Facsimile No.: (215) 973-6959
Payment Address for Dollars:
Same as Above
Eurocurrency Payment Address:
Same as Above
S-6
<PAGE> 145
SUNTRUST BANK OF CENTRAL FLORIDA,
NATIONAL ASSOCIATION
as a Lender
By: /s/ C.A. Black
------------------------------
Name: C.A. Black
Title: Vice President
Notice Address:
200 S. Orange Avenue
Orlando, FL 32801
Attention: Christopher Black
Telephone No.: (407) 237-2467
Facsimile No.: (407) 237-6894
Payment Address for Dollars:
ABA #: 063 102152
Commercial Loans Operations
Account #: 9215004320
For further credit to Brightpoint
Ref: 1045425802
Eurocurrency Payment Address:
Same as Above
S-7
<PAGE> 146
THE BANK OF NOVA SCOTIA
as a Lender
By: /s/ F.C.H. Ashby
------------------------------
Name: F.C.H. Ashby
Title: Senior Manager
Loan Operations
Notice Address:
600 Peachtree Street N.E.
Suite 2700
Atlanta, GA 30308
Attention: Vicki Gibson
Telephone No.: (404) 877-1557
Facsimile No.: (404) 888-8998
Payment Address for Dollars:
ABA #: 260 02532
Credit Bank of Nova Scotia, Atlanta
Account: 0606634
Ref: Brightpoint
Eurocurrency Payment Address:
Same as Above
S-8
<PAGE> 147
CREDIT LYONNAIS CHICAGO BRANCH
as a Lender
By: /s/ Lee E. Greve
------------------------------
Name: Lee E. Greve
Title: First Vice President
Notice Address:
227 West Monroe Street
Suite 3800
Chicago, IL 60606
Attention: Michael Lord
Telephone No.: (312) 220-7318
Facsimile No.: (312) 641-0527
Payment Address for Dollars:
FED FUNDS - CREDIT LYONNAIS NEW YORK
ABA# : 0260-0807-3
For Account of Credit Lyonnais Chicago Branch
Account: 01.00688.0001.00
Ref: Brightpoint
Eurocurrency Payment Address:
Same as Above
S-9
<PAGE> 148
THE BANK OF TOKYO-MITSUBISHI, LTD.
CHICAGO BRANCH
as a Lender
By: /s/ Hajime Watanabe
------------------------------
Name: Hajime Watanabe
Title: Deputy General Manager
Notice Address:
227 West Monroe Street
Suite 2300
Chicago, IL 60606
Attention: Christopher Jones
Telephone No.: (312) 696-4656
Facsimile No.: (312) 696-4535
Payment Address for Dollars:
ABA #: 071002341
Account: Bank of Tokyo-Mitsubishi Ltd. Chicago
Ref: Brightpoint
Eurocurrency Payment Address:
Same as Above
S-10
<PAGE> 149
THE FUJI BANK, LIMITED
as a Lender
By: /s/ Peter L. Chinnici
------------------------------
Name: Peter L. Chinnici
Title: Joint General Manager
Notice Address:
225 West Wacker Drive
Suite 2000
Chicago, IL 60602
Attention: James R. Fayen
Telephone No.: (312) 621-0397
Facsimile No.: (312) 621-0539
Payment Address for Dollars:
The First National Bank of Chicago
071-000-013
Account: The Fuji Bank Limited Chicago Branch
Account No.: 15-04797
Ref: Brightpoint
Attention: Loan Administrator
Eurocurrency Payment Address:
Same as Above
S-11
<PAGE> 150
THE FIRST NATIONAL BANK OF CHICAGO
as the Original Administrative Agent
By: /s/ Dennis L. Bassett
------------------------------
Name: Dennis L. Bassett
Title: Senior Vice President
S-12
<PAGE> 1
EXHIBIT 10.3
EXPANSION AGREEMENT
THIS EXPANSION AGREEMENT is entered into as of the 9th day of June, 1998,
by and between SCI North Carolina Limited Partnership (the "Landlord") and
Brightpoint North America, Inc. (the "Tenant").
WITNESSETH:
WHEREAS, Landlord and Tenant have entered into a Lease, dated as of the
20th day of March, 1998, pursuant to which Landlord leased to Tenant certain
premises located at 8210 Allison Avenue, Indianapolis, IN (such lease, as
heretofore and hereafter modified, being herein referred to as the "Lease").
WHEREAS, Landlord and Tenant desire to enter into a Lease for 8196 Allison
Avenue, Indianapolis, IN ("Expansion Space") on the terms and conditions set
forth below.
NOW THEREFORE, in consideration of Ten Dollars ($10.00) and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Landlord and Tenant agree as follows:
1. The Expansion Space is 26,400 rentable square feet, as shown in
Exhibit A.
2. The Monthly Base Rent shall be $8,250.00 for the Expansion Space.
3. The term of the Lease for the Expansion Space shall be fifteen
(15) months, such that the Lease Term for the Expansion space will
commence on July 1, 1998, and will terminate on September 30, 1999, with
Tenant having a right to renew for an additional three (3) months at $3.95
per square foot.
4. Landlord will provide one (1) opening in the block demising wall
between 8210 Allison Avenue and the Expansion Space, otherwise the
Expansion Space will be provided on an "as-is" basis.
5. Except as modified herein, the Lease, and all of the terms and
conditions thereof, shall remain in full force and effect.
6. Any obligation or liability whatsoever of Security Capital
Industrial Trust, a Maryland real estate investment Trust, which may arise
at any time under the Lease or this Agreement or any obligation or
liability which may be incurred by it pursuant to any other instrument,
transaction or undertaking contemplated hereby, shall not be personally
binding upon, nor shall resort for the enforcement thereof be had to the
property of, its trustees, directors, shareholders, officers, employees,
or agents regardless of whether such obligation or liability is in the
nature of contract, tort or otherwise.
IN WITNESS WHEREOF, the parties hereto have signed this Extension
Agreement as of the day and year first above written.
SCI North Carolina Limited Partnership
/s/ Walter C. Rakowich
----------------------------------------
By:
Walter C. Rakowich
----------------------------------------
Name:
Managing Director
----------------------------------------
Title:
LANDLORD
Brightpoint North America, Inc.
/s/ Steven E. Fivel
----------------------------------------
By:
Steven E. Fivel
----------------------------------------
Name:
Vice President
----------------------------------------
Title:
<PAGE> 1
Exhibit (11) Statement Re: Computation of Earnings Per Share
(Amounts in thousands, except per share data)
<TABLE>
<CAPTION>
Three Months Ended June 30 Six Months Ended June 30
1997 1998 1997 1998
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Basic:
Weighted average shares outstanding 44,594 51,979 44,228 51,597
========== ========== ========== ==========
Income before income taxes and minority interest $ 6,991 $ 12,877 $ 15,206 $ 25,457
Deduct income taxes 2,097 3,863 4,540 7,637
Deduct (add) minority interest 27 (44) 383 (81)
---------- ---------- ---------- ----------
Net income $ 4,867 $ 9,058 $ 10,283 $ 17,901
Per share amount $ 0.11 $ 0.17 $ 0.23 $ 0.35
Diluted:
Average shares outstanding 44,594 51,979 44,228 51,597
Net effect of stock options and warrants -
based on the treasury stock method
using average market price 2,084 1,746 2,090 1,983
---------- ---------- ---------- ----------
Total weighted average shares outstanding 46,678 53,725 46,318 53,580
========== ========== ========== ==========
Income before income taxes and minority interest $ 6,991 $ 12,877 $ 15,206 $ 25,457
Deduct income taxes 2,097 3,863 4,540 7,637
Deduct (add) minority interest 27 (44) 383 (81)
---------- ---------- ---------- ----------
Net income $ 4,867 $ 9,058 $ 10,283 $ 17,901
========== ========== ========== ==========
Per share amount $ 0.10 $ 0.17 $ 0.22 $ 0.33
========== ========== ========== ==========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
QUARTERLY FORM 10-Q FOR THE PERIOD ENDED JUNE 30, 1998 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 40,020
<SECURITIES> 0
<RECEIVABLES> 206,599
<ALLOWANCES> 4,117
<INVENTORY> 152,049
<CURRENT-ASSETS> 427,889
<PP&E> 38,944
<DEPRECIATION> 0
<TOTAL-ASSETS> 559,928
<CURRENT-LIABILITIES> 75,391
<BONDS> 250,141
0
0
<COMMON> 520
<OTHER-SE> 233,700
<TOTAL-LIABILITY-AND-EQUITY> 559,928
<SALES> 673,146
<TOTAL-REVENUES> 673,146
<CGS> 612,564
<TOTAL-COSTS> 612,564
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6,439
<INCOME-PRETAX> 25,457
<INCOME-TAX> 7,637
<INCOME-CONTINUING> 17,901
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 17,901
<EPS-PRIMARY> .35
<EPS-DILUTED> .33
</TABLE>
<PAGE> 1
EXHIBIT 99
CAUTIONARY STATEMENTS
Certain statements in this Form 10-Q constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements of
the Company to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements. Such
factors include, among others, the following: the ability to hire and retain key
personnel; successful completion and integration of future acquisitions;
relationships with and dependence on third-party wireless communications
equipment suppliers; uncertainties relating to economic conditions in markets in
which the Company operates; uncertainties relating to government and regulatory
policies; uncertainties relating to customer plans and commitments; dependence
on the wireless communications industry; pricing and availability of wireless
communications equipment materials and inventories; rapid technological
developments and obsolescence in the wireless communications industry; potential
performance issues with suppliers and customers; governmental export and import
policies; global trade policies; worldwide political stability and economic
growth; the highly competitive environment in which the Company operates;
potential entry of new, well-capitalized competitors into the Company's markets;
changes in the Company's capital structure and cost of capital; and
uncertainties inherent in international operations and foreign currency
fluctuations. The words "believe," "expect," "anticipate," "intend," "forecast,"
and "plan" and similar expressions identify forward-looking statements. Readers
are cautioned not to place undue reliance on these forward-looking statements,
which speak only as of the date of the statement was made.
