<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 10, 1998
SITEL CORPORATION
(Exact name of registrant as specified in its charter)
Minnesota 1-12577 47-0684333
(State or jurisdiction of (Commission File (I.R.S. Employer
incorporation or organization) Number) Identification No.)
300 East Lombard Street, Suite 850, Baltimore, Maryland 21202
______________________________________________________________
(Address of Principal Executive Officer)
Registrant's telephone number, including area code (410) 659-5700
_________________
13215 Birch Street, Suite 100, Omaha, Nebraska 68164
_______________________________________________________
(Former Name or Former Address, if Changed Since Last Report)
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
_________________________________________________
This 8-K consists of 253 pages.
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ITEM 5. OTHER EVENTS
On March 10, 1998, SITEL Corporation (the "Company") completed the private
placement of $100 million of 9 1/4% Senior Subordinated Notes due 2006
(the "Notes"). The proceeds from the offering were used to repay
borrowings outstanding under the Company's long term revolving credit facility
(the "Credit Facility") which was also amended on that date.
The Notes, which include interest payable semiannually, are general
unsecured obligations of the Company, will be subordinated in right of payment
to all existing and future senior debt of the Company and may not be redeemed
prior to March 15, 2002. The Notes are guaranteed by certain of the Company's
subsidiaries and contain certain covenants that limit the ability of the Company
and certain of its subsidiaries to, among other things, incur additional
indebtedness, pay dividends or make certain other restricted payments,
consummate certain asset sales, enter into certain transactions with affiliates,
incur liens, merge or consolidate with another company and sell or otherwise
dispose of all or substantially all of the assets of the Company.
The Company also reached an agreement with a syndicate of commercial banks
to amend the Company's existing Credit Facility to limit borrowings under the
Credit Facility to an amount based upon a percentage of the Company's eligible
domestic accounts receivable, as defined, up to $75 million. Certain of the
financial covenants and restrictions were amended and the Company's eligible
domestic accounts receivable were pledged as security.
For more information, reference is made to the amended credit facility and
the indenture, attached hereto as Exhibit 10.1 and 10.2, respectively, and
incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
The following exhibits are filed herewith.
(a) EXHIBITS:
10.1 Amended Credit Agreement with Bankers Trust Company as Agent
10.2 Indenture governing $100,000,000 9 1/4% Senior Subordinated
Notes due 2006
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SITEL Corporation
___________________________________
(Registrant)
By: /s/ Barry S. Major
______________________________
Barry S. Major
Chief Financial Officer
Date: March 16, 1998
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CREDIT AGREEMENT
among
SITEL CORPORATION,
VARIOUS BANKS,
U.S. BANK NATIONAL ASSOCIATION,
as SYNDICATION AGENT,
FIRST UNION NATIONAL BANK,
as DOCUMENTATION AGENT,
and
BANKERS TRUST COMPANY,
as AGENT
__________________________________
Dated as of July 24, 1997
and
amended and restated
as of
March 10, 1998
========================================================================
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CREDIT AGREEMENT, dated as of July 24, 1997 and amended and restated
as of March 10, 1998, among SITEL CORPORATION, a Minnesota corporation (the
"Borrower"), the Banks party hereto from time to time, U.S. BANK NATIONAL
ASSOCIATION, as Syndication Agent, FIRST UNION NATIONAL BANK, as Documentation
Agent, and BANKERS TRUST COMPANY, as Agent (all capitalized terms used herein
and defined in Section 11 are used herein as therein defined).
W I T N E S S E T H :
_ _ _ _ _ _ _ _ _ _
WHEREAS, the Borrower, the Banks and the Agent are parties to a Credit
Agreement, dated as of July 24, 1997 (as amended, modified or supplemented to,
but not including, the Restatement Effective Date, the "Original Credit
Agreement"); and
WHEREAS, the Borrower has requested that the Original Credit Agreement
be amended and restated in its entirety, and the Banks and the Agent are willing
to amend and restate the same, upon the terms and conditions set forth herein;
NOW, THEREFORE, the parties hereto agree that, on the Restatement
Effective Date, the Original Credit Agreement shall be and is hereby amended and
restated in its entirety as follows:
SECTION 1. Amount and Terms of Credit.
1.01 The Commitments. (a) Subject to and upon the terms and
conditions set forth herein, each Bank severally agrees (A) to convert, on the
Restatement Effective Date, Original Revolving Loans made by such Bank to the
Borrower pursuant to the Original Credit Agreement and outstanding on the
Restatement Effective Date (but after giving effect to the repayment of Original
Revolving Loans on such date pursuant to Section 5.05) into a Borrowing of
Revolving Loans hereunder (as so converted, together with all revolving loans
made pursuant to following clause (B), the "Revolving Loans" and each, a
"Revolving Loan") and (B) to make, at any time and from time to time on and
after the Restatement Effective Date and prior to the Final Maturity Date, one
or more additional Revolving Loans to the Borrower, all of which Revolving Loans
made pursuant to preceding clauses (A) and (B) (i) shall, at the option of the
Borrower, be incurred and maintained as, and/or converted into, Base Rate Loans
or Eurodollar Loans, provided that, except as otherwise specifically provided in
Section 1.10(b), all Revolving Loans comprising the same Borrowing shall at all
times be of the same Type, (ii) may be repaid and reborrowed in accordance with
the provisions hereof, (iii) shall not exceed for any Bank at any time
outstanding that aggregate principal amount which, when added to the product of
(x) such Bank's RL Percentage and (y) the sum of (I) the aggregate amount of all
Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid
with the proceeds of, and simultaneously with the incurrence of, the respective
incurrence of Revolving Loans) at such time and (II) the aggregate principal
amount of all Swingline Loans (exclusive of Swingline Loans which are repaid
with the proceeds of, and simultaneously with the incurrence of, the respective
incurrence of Revolving Loans) then outstanding, equals the Revolving Loan
Commitment of such Bank at such time and (iv) shall not exceed for all Banks at
any time outstanding that aggregate principal amount which, when added to the
sum of (I) the aggregate amount of all Letter of Credit Outstandings (exclusive
of Unpaid Drawings which are repaid with the proceeds of, and simultaneously
with the incurrence of, the respective incurrence of Revolving Loans) at such
time and (II) the aggregate principal amount of all Swingline Loans (exclusive
of Swingline Loans which are repaid with the proceeds of, and simultaneously
with the incurrence of, the respective incurrence of Revolving Loans) then
outstanding, equals the lesser of (x) the Borrowing Base at such time (based on
the Borrowing Base Certificate last delivered) and (y) the Total Revolving Loan
Commitment at such time.
(b) Subject to and upon the terms and conditions set forth herein,
the Swingline Bank agrees to make, at any time and from time to time on and
after the Restatement Effective Date and prior to the Swingline Expiry Date, a
revolving loan or revolving loans (each a "Swingline Loan" and, collectively,
the "Swingline Loans") to the Borrower, which Swingline Loans (i) shall be made
and maintained as Base Rate Loans, (ii) may be repaid and reborrowed in
accordance with the provisions hereof, (iii) shall not exceed in aggregate
principal amount at any time outstanding, when combined with the sum of (I) the
aggregate principal amount of all Revolving Loans then outstanding and (II) the
aggregate amount of all Letter of Credit Outstandings at such time, an amount
equal to the lesser of (A) the Borrowing Base at such time (based on the
Borrowing Base Certificate last delivered) and (B) the Total Revolving Loan
Commitment at such time, and (iv) shall not exceed in aggregate principal amount
at any time outstanding the Maximum Swingline Amount. Notwithstanding anything
to the contrary contained in this Section 1.01(b), (x) the Swingline Bank shall
not be obligated to make any Swingline Loans at a time when a Bank Default
exists unless the Swingline Bank has entered into arrangements satisfactory to
it and the Borrower to eliminate the Swingline Bank's risk with respect to the
Defaulting Bank's or Banks' participation in such Swingline Loans, including by
cash collateralizing such Defaulting Bank's or Banks' RL Percentage of the
outstanding Swingline Loans and (y) the Swingline Bank shall not make any
Swingline Loan after it has received written notice from the Borrower or the
Required Banks stating that a Default or an Event of Default exists and is
continuing until such time as the Swingline Bank shall have received written
notice (I) of rescission of all such notices from the party or parties
originally delivering such notice or (II) of the waiver of such Default or Event
of Default by the Required Banks.
(c) On any Business Day, the Swingline Bank may, in its sole
discretion, give notice to the Banks that the Swingline Bank's outstanding
Swingline Loans shall be funded with one or more Borrowings of Revolving Loans
(provided that such notice shall be deemed to have been automatically given upon
the occurrence of a Default or an Event of Default under Section 10.05 or upon
the exercise of any of the remedies provided in the last paragraph of Section
10), in which case one or more Borrowings of Revolving Loans constituting Base
Rate Loans (each such Borrowing, a "Mandatory Borrowing") shall be made on the
immediately succeeding Business Day by all Banks pro rata based on each Bank's
RL Percentage (determined before giving effect to any termination of the
Revolving Loan Commitments pursuant to the last paragraph of Section 10) and the
proceeds thereof shall be applied directly by the Swingline Bank to repay the
Swingline Bank for such outstanding Swingline Loans. Each Bank hereby
irrevocably agrees to make Revolving Loans upon one Business Day's notice
pursuant to each Mandatory Borrowing in the amount and in the manner specified
in the preceding sentence and on the date specified in writing by the Swingline
Bank notwithstanding (i) the amount of the Mandatory Borrowing may not comply
with the Minimum Borrowing Amount otherwise required hereunder, (ii) whether any
conditions specified in Section 6 are then satisfied, (iii) whether a Default or
an Event of Default then exists, (iv) the date of such Mandatory Borrowing and
(v) the amount of the Borrowing Base or the Total Revolving Loan Commitment at
such time. In the event that any Mandatory Borrowing cannot for any reason be
made on the date otherwise required above (including, without limitation, as a
result of the commencement of a proceeding under the Bankruptcy Code with
respect to the Borrower), then each Bank hereby agrees that it shall forthwith
purchase (as of the date the Mandatory Borrowing would otherwise have occurred,
but adjusted for any payments received from the Borrower on or after such date
and prior to such purchase) from the Swingline Bank such participations in the
outstanding Swingline Loans as shall be necessary to cause the Banks to share in
such Swingline Loans ratably based upon their respective RL Percentages
(determined before giving effect to any termination of the Revolving Loan
Commitments pursuant to the last paragraph of Section 10), provided that (x) all
interest payable on the Swingline Loans shall be for the account of the
Swingline Bank until the date as of which the respective participation is
required to be purchased and, to the extent attributable to the purchased
participation, shall be payable to the participant from and after such date and
(y) at the time any purchase of participations pursuant to this sentence is
actually made, the purchasing Bank shall be required to pay the Swingline Bank
interest on the principal amount of participation purchased for each day from
and including the day upon which the Mandatory Borrowing would otherwise have
occurred to but excluding the date of payment for such participation, at the
overnight Federal Funds Rate for the first three days and at the rate otherwise
applicable to Revolving Loans maintained as Base Rate Loans hereunder for each
day thereafter.
1.02 Minimum Amount Of Each Borrowing. The aggregate principal
amount of each Borrowing of Revolving Loans or Swingline Loans shall not be less
than the Minimum Borrowing Amount applicable thereto. More than one Borrowing
may occur on the same date, but at no time shall there be outstanding more than
ten Borrowings of Eurodollar Loans.
1.03 Notice Of Borrowing. (a) Whenever the Borrower desires to
incur (x) Eurodollar Loans hereunder, the Borrower shall give the Agent at the
Notice Office at least three Business Days' prior notice of each Eurodollar Loan
to be incurred hereunder and (y) Base Rate Loans hereunder (excluding Swingline
Loans), the Borrower shall give the Agent at the Notice Office at least one
Business Day's prior notice of each Base Rate Loan to be incurred hereunder,
provided that (in each case) any such notice shall be deemed to have been given
on a certain day only if given before 11:00 A.M. (New York time) on such day.
Each such notice (each a "Notice of Borrowing"), except as otherwise expressly
provided in Section 1.10, shall be irrevocable and shall be given by the
Borrower in writing, or by telephone promptly confirmed in writing, in the form
of Exhibit A, appropriately completed to specify the aggregate principal amount
of the Revolving Loans to be incurred pursuant to such Borrowing, the date of
such Borrowing (which shall be a Business Day), and whether the Revolving Loans
being incurred pursuant to such Borrowing are to be initially maintained as Base
Rate Loans or, to the extent permitted hereunder, Eurodollar Loans and, if
Eurodollar Loans, the initial Interest Period to be applicable thereto. The
Agent shall promptly give each Bank notice of such proposed Borrowing, of such
Bank's proportionate share thereof and of the other matters required by the
immediately preceding sentence to be specified in the Notice of Borrowing.
(b)(i) Whenever the Borrower desires to incur Swingline Loans
hereunder, the Borrower shall give the Swingline Bank no later than 2:00 P.M.
(New York time) on the date that a Swingline Loan is to be incurred hereunder,
written notice or telephonic notice promptly confirmed in writing of each
Swingline Loan to be incurred hereunder. Each such notice shall be irrevocable
and specify in each case (A) the date of Borrowing (which shall be a Business
Day) and (B) the aggregate principal amount of the Swingline Loans to be
incurred pursuant to such Borrowing.
(ii) Mandatory Borrowings shall be made upon the notice specified in
Section 1.01(c), with the Borrower irrevocably agreeing, by its incurrence of
any Swingline Loan, to the making of the Mandatory Borrowings as set forth in
Section 1.01(c).
(c) Without in any way limiting the obligation of the Borrower to
confirm in writing any telephonic notice of any Borrowing or prepayment of
Loans, the Agent or the Swingline Bank, as the case may be, may act without
liability upon the basis of telephonic notice of such Borrowing or prepayment,
as the case may be, believed by the Agent or the Swingline Bank, as the case may
be, in good faith to be from the Chairman of the Board, the Chief Executive
Officer, the President, the Chief Financial Officer, the Treasurer or any
Assistant Treasurer of the Borrower, or from any other authorized officer of the
Borrower designated in writing by any of the foregoing officers of the Borrower
to the Agent as being authorized to give such notices, prior to receipt of
written confirmation. In each such case, the Borrower hereby waives the right to
dispute the Agent's or Swingline Bank's record of the terms of such telephonic
notice of such Borrowing or prepayment of Loans, as the case may be, absent
manifest error.
1.04 Disbursement Of Funds. No later than 12:00 Noon (New York time)
on the date specified in each Notice of Borrowing (or (x) in the case of
Swingline Loans, no later than 3:00 P.M. (New York time) on the date specified
pursuant to Section 1.03(b)(i) or (y) in the case of Mandatory Borrowings, no
later than 1:00 P.M. (New York time) on the date specified in Section 1.01(c)),
each Bank will make available its pro rata portion (determined in accordance
with Section 1.07) of each such Borrowing requested to be made on such date (or
in the case of Swingline Loans, the Swingline Bank will make available the full
amount thereof). All such amounts will be made available in Dollars and in
immediately available funds at the Payment Office, and, except for Revolving
Loans made pursuant to a Mandatory Borrowing, the Agent will make available to
the Borrower at the Payment Office the aggregate of the amounts so made
available by the Banks. Unless the Agent shall have been notified by any Bank
prior to the date of Borrowing that such Bank does not intend to make available
to the Agent such Bank's portion of any Borrowing to be made on such date, the
Agent may assume that such Bank has made such amount available to the Agent on
such date of Borrowing and the Agent may (but shall not be obligated to), in
reliance upon such assumption, make available to the Borrower a corresponding
amount. If such corresponding amount is not in fact made available to the Agent
by such Bank, the Agent shall be entitled to recover such corresponding amount
on demand from such Bank. If such Bank does not pay such corresponding amount
forthwith upon the Agent's demand therefor, the Agent shall promptly notify the
Borrower and the Borrower shall immediately pay such corresponding amount to the
Agent. The Agent also shall be entitled to recover on demand from such Bank or
the Borrower, as the case may be, interest on such corresponding amount in
respect of each day from the date such corresponding amount was made available
by the Agent to the Borrower until the date such corresponding amount is
recovered by the Agent, at a rate per annum equal to (i) if recovered from such
Bank, at the overnight Federal Funds Rate and (ii) if recovered from the
Borrower, the rate of interest applicable to the respective Borrowing, as
determined pursuant to Section 1.08. Nothing in this Section 1.04 shall be
deemed to relieve any Bank from its obligation to make Loans hereunder or to
prejudice any rights which the Borrower may have against any Bank as a result of
any failure by such Bank to make Loans hereunder.
1.05 Notes. (a) The Borrower's obligation to pay the principal of,
and interest on, the Loans made by each Bank shall be evidenced (i) if Revolving
Loans, by a promissory note duly executed and delivered by the Borrower
substantially in the form of Exhibit B-1, with blanks appropriately completed in
conformity herewith (each a "Revolving Note" and, collectively, the "Revolving
Notes") and (ii) if Swingline Loans, by a promissory note duly executed and
delivered by the Borrower substantially in the form of Exhibit B-2, with blanks
appropriately completed in conformity herewith (the "Swingline Note").
(b) The Revolving Note issued to each Bank shall (i) be executed by
the Borrower, (ii) be payable to such Bank or its registered assigns and be
dated the Restatement Effective Date (or, if issued after the Restatement
Effective Date, be dated the date of the issuance thereof), (iii) be in a stated
principal amount equal to the Revolving Loan Commitment of such Bank (or, if
issued after the termination thereof, be in a stated principal amount equal to
the outstanding Revolving Loans of such Bank at such time) and be payable in the
outstanding principal amount of the Revolving Loans evidenced thereby, (iv)
mature on the Final Maturity Date, (v) bear interest as provided in the
appropriate clause of Section 1.08 in respect of the Base Rate Loans and
Eurodollar Loans, as the case may be, evidenced thereby, (vi) be subject to
voluntary prepayment as provided in Section 4.01, and mandatory repayment as
provided in Section 4.02, and (vii) be entitled to the benefits of this
Agreement and the other Credit Documents.
(c) The Swingline Note issued to the Swingline Bank shall (i) be
executed by the Borrower, (ii) be payable to the Swingline Bank or its
registered assigns and be dated the Restatement Effective Date, (iii) be in a
stated principal amount equal to the Maximum Swingline Amount and be payable in
the outstanding principal amount of the Swingline Loans evidenced thereby from
time to time, (iv) mature on the Swingline Expiry Date, (v) bear interest as
provided in the appropriate clause of Section 1.08 in respect of the Base Rate
Loans evidenced thereby, (vi) be subject to voluntary prepayment as provided in
Section 4.01, and mandatory repayment as provided in Section 4.02 and (vii) be
entitled to the benefits of this Agreement and the other Credit Documents.
(d) Each Bank will note on its internal records the amount of each
Loan made by it and each payment in respect thereof and will prior to any
transfer of any of its Notes endorse on the reverse side thereof the outstanding
principal amount of Loans evidenced thereby. Failure to make any such notation
or any error in such notation shall not affect the Borrower's obligations in
respect of such Loans.
1.06 Conversions. The Borrower shall have the option to convert, on
any Business Day, all or a portion equal to at least the Minimum Borrowing
Amount of the outstanding principal amount of Revolving Loans made pursuant to
one or more Borrowings of one or more Types of Revolving Loans into a Borrowing
of another Type of Revolving Loan, provided that, (i) except as otherwise
provided in Section 1.10(b), Eurodollar Loans may be converted into Base Rate
Loans only on the last day of an Interest Period applicable to the Revolving
Loans being converted and no such partial conversion of Eurodollar Loans shall
reduce the outstanding principal amount of such Eurodollar Loans made pursuant
to a single Borrowing to less than the Minimum Borrowing Amount applicable
thereto, (ii) Base Rate Loans may only be converted into Eurodollar Loans if no
Default or Event of Default is in existence on the date of such conversion, and
(iii) no conversion pursuant to this Section 1.06 shall result in a greater
number of Borrowings of Eurodollar Loans than is permitted under Section 1.02.
Each such conversion shall be effected by the Borrower by giving the Agent at
the Notice Office prior to 11:00 A.M. (New York time) at least three Business
Days' prior notice (each a "Notice of Conversion") specifying the Revolving
Loans to be so converted, the Borrowing or Borrowings pursuant to which such
Loans were made and, if to be converted into Eurodollar Loans, the Interest
Period to be initially applicable thereto. The Agent shall give each Bank
prompt notice of any such proposed conversion affecting any of its Revolving
Loans. Upon any such conversion the proceeds thereof will be deemed to be
applied directly on the day of such conversion to prepay the outstanding
principal amount of the Revolving Loans being converted. Swingline Loans may
not be converted pursuant to this Section 1.06.
1.07 Pro Rata Borrowings. All Borrowings of Revolving Loans under
this Agreement shall be incurred from the Banks pro rata on the basis of their
Revolving Loan Commitments. It is understood that no Bank shall be responsible
for any default by any other Bank of its obligation to make Revolving Loans
hereunder and that each Bank shall be obligated to make the Revolving Loans
provided to be made by it hereunder, regardless of the failure of any other Bank
to make its Revolving Loans hereunder.
1.08 Interest. (a) The Borrower agrees to pay interest in respect
of the unpaid principal amount of each Base Rate Loan from the date of Borrowing
thereof until the maturity thereof (whether by acceleration or otherwise) at a
rate per annum which shall be equal to the Base Rate in effect from time to
time.
(b) The Borrower agrees to pay interest in respect of the unpaid
principal amount of each Eurodollar Loan from the date of Borrowing thereof
until the maturity thereof (whether by acceleration or otherwise) at a rate per
annum which shall, during each Interest Period applicable thereto, be equal to
the sum of the Applicable Eurodollar Rate Margin plus the Eurodollar Rate for
such Interest Period.
(c) Overdue principal and, to the extent permitted by law, overdue
interest in respect of each Loan and any other overdue amount payable hereunder
shall, in each case, bear interest at a rate per annum equal to the greater of
(x) the rate which is 2% in excess of the rate then borne by such Loans and (y)
the rate which is 2% in excess of the rate otherwise applicable to Base Rate
Loans from time to time. Interest which accrues under this Section 1.08(c)
shall be payable on demand.
(d) Accrued (and theretofore unpaid) interest shall be payable (i) in
respect of each Base Rate Loan, quarterly in arrears on each Quarterly Payment
Date, (ii) in respect of each Eurodollar Loan, on the last day of each Interest
Period applicable thereto and, in the case of an Interest Period in excess of
three months, on each date occurring at three month intervals after the first
day of such Interest Period and (iii) in respect of each Loan, on any repayment
or prepayment (on the amount repaid or prepaid), at maturity (whether by
acceleration or otherwise) and, after such maturity, on demand. Interest which
accrued under the Original Credit Agreement prior to the Restatement Effective
Date but which remains unpaid on such date (and which was not required to be
paid on or prior to such date in accordance with the terms of the Original
Credit Agreement or this Agreement) shall be payable at the times otherwise
provided above (but calculated at the respective rates provided in the Original
Credit Agreement for periods occurring prior to the Restatement Effective Date)
for the interest involved.
(e) Upon each Interest Determination Date, the Agent shall determine
the Eurodollar Rate for each Interest Period applicable to Eurodollar Loans and
shall promptly notify the Borrower and the Banks thereof. Each such
determination shall, absent manifest error, be final and conclusive and binding
on all parties hereto.
1.09 Interest Periods. At the time the Borrower gives any Notice of
Borrowing or Notice of Conversion in respect of the making of, or conversion
into, any Eurodollar Loan (in the case of the initial Interest Period applicable
thereto) or on the third Business Day prior to the expiration of an Interest
Period applicable to such Eurodollar Loan (in the case of any subsequent
Interest Period), the Borrower shall have the right to elect, by giving the
Agent notice thereof, the interest period (each an "Interest Period") applicable
to such Eurodollar Loan, which Interest Period shall, at the option of the
Borrower, be a one, two, three or six-month period, provided that:
(i) all Eurodollar Loans comprising a Borrowing shall at all times
have the same Interest Period;
(ii) the initial Interest Period for any Eurodollar Loan shall
commence on the date of Borrowing of such Eurodollar Loan (including the
date of any conversion thereto from a Base Rate Loan) and each Interest
Period occurring thereafter in respect of such Eurodollar Loan shall
commence on the day on which the next preceding Interest Period applicable
thereto expires;
(iii) if any Interest Period for a Eurodollar Loan begins on a day
for which there is no numerically corresponding day in the calendar month
at the end of such Interest Period, such Interest Period shall end on the
last Business Day of such calendar month;
(iv) if any Interest Period for a Eurodollar Loan would otherwise
expire on a day which is not a Business Day, such Interest Period shall
expire on the next succeeding Business Day; provided, however, that if any
Interest Period for a Eurodollar Loan would otherwise expire on a day which
is not a Business Day but is a day of the month after which no further
Business Day occurs in such month, such Interest Period shall expire on the
next preceding Business Day;
(v) no Interest Period may be selected at any time when a Default or
an Event of Default is then in existence; and
(vi) no Interest Period in respect of any Borrowing of Eurodollar
Loans shall be selected which extends beyond the Final Maturity Date.
If upon the expiration of any Interest Period applicable to a
Borrowing of Eurodollar Loans, the Borrower has failed to elect, or is not
permitted to elect, a new Interest Period to be applicable to such Eurodollar
Loans as provided above, the Borrower shall be deemed to have elected to convert
such Eurodollar Loans into Base Rate Loans effective as of the expiration date
of such current Interest Period.
1.10 Increased Costs, Illegality, etc. (a) In the event that any
Bank shall have determined (which determination shall, absent manifest error, be
final and conclusive and binding upon all parties hereto but, with respect to
clause (i) below, may be made only by the Agent):
(i) on any Interest Determination Date that, by reason of any changes
arising after the date of this Agreement affecting the interbank Eurodollar
market, adequate and fair means do not exist for ascertaining the
applicable interest rate on the basis provided for in the definition of
Eurodollar Rate; or
(ii) at any time, that such Bank shall incur increased costs or
reductions in the amounts received or receivable hereunder with respect to
any Eurodollar Loan because of (x) any change since the Effective Date in
any applicable law or governmental rule, regulation, order, guideline or
request (whether or not having the force of law) or in the interpretation
or administration thereof and including the introduction of any new law or
governmental rule, regulation, order, guideline or request, such as, for
example, but not limited to: (A) a change in the basis of taxation of
payment to any Bank of the principal of or interest on the Notes or any
other amounts payable hereunder (except for changes in the rate of tax on,
or determined by reference to, the net income or profits of such Bank
pursuant to the laws of the jurisdiction in which it is organized or in
which its principal office or applicable lending office is located or any
subdivision thereof or therein) or (B) a change in official reserve
requirements, but, in all events, excluding reserves required under
Regulation D to the extent included in the computation of the Eurodollar
Rate and/or (y) other circumstances since the Effective Date affecting such
Bank, the interbank Eurodollar market or the position of such Bank in such
market; or
(iii) at any time, that the making or continuance of any
Eurodollar Loan has been made (x) unlawful by any law or governmental rule,
regulation or order, (y) impossible by compliance by any Bank in good faith
with any governmental request (whether or not having force of law) or (z)
impracticable as a result of a contingency occurring after the Effective
Date which materially and adversely affects the interbank Eurodollar
market;
then, and in any such event, such Bank (or the Agent, in the case of
clause (i) above) shall promptly give notice (by telephone promptly
confirmed in writing) to the Borrower and, except in the case of clause (i)
above, to the Agent of such determination (which notice the Agent shall
promptly transmit to each of the other Banks). Thereafter (x) in the case
of clause (i) above, Eurodollar Loans shall no longer be available until
such time as the Agent notifies the Borrower and the Banks that the
circumstances giving rise to such notice by the Agent no longer exist, and
any Notice of Borrowing or Notice of Conversion given by the Borrower with
respect to Eurodollar Loans which have not yet been incurred (including by
way of conversion) shall be deemed rescinded by the Borrower, (y) in the
case of clause (ii) above, the Borrower shall pay to such Bank, upon such
Bank's written request therefor, such additional amounts (in the form of an
increased rate of, or a different method of calculating, interest or
otherwise as such Bank in its sole discretion shall determine) as shall be
required to compensate such Bank for such increased costs or reductions in
amounts received or receivable hereunder (a written notice as to the
additional amounts owed to such Bank, showing in reasonable detail the
basis for the calculation thereof, submitted to the Borrower by such Bank
shall, absent manifest error, be final and conclusive and binding on all
the parties hereto) and (z) in the case of clause (iii) above, the Borrower
shall take one of the actions specified in Section 1.10(b) as promptly as
possible and, in any event, within the time period required by law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), the Borrower may (and
in the case of a Eurodollar Loan affected by the circumstances described in
Section 1.10(a)(iii) the Borrower shall) either (x) if the affected Eurodollar
Loan is then being made initially or pursuant to a conversion, cancel such
Borrowing by giving the Agent telephonic notice (confirmed in writing) on the
same date that the Borrower was notified by the affected Bank or the Agent
pursuant to Section 1.10(a)(ii) or (iii) or (y) if the affected Eurodollar Loan
is then outstanding, upon at least three Business Days' written notice to the
Agent, require the affected Bank to convert such Eurodollar Loan into a Base
Rate Loan, provided that, if more than one Bank is affected at any time, then
all affected Banks must be treated the same pursuant to this Section 1.10(b).
(c) If any Bank determines that after the Effective Date the
introduction of or any change in any applicable law or governmental rule,
regulation, order, guideline, directive or request (whether or not having the
force of law) concerning capital adequacy, or any change in interpretation or
administration thereof by the NAIC or any governmental authority, central bank
or comparable agency, will have the effect of increasing the amount of capital
required or expected to be maintained by such Bank or any corporation
controlling such Bank based on the existence of such Bank's Revolving Loan
Commitment hereunder or its obligations hereunder, then the Borrower shall pay
to such Bank, upon its written demand therefor, such additional amounts as shall
be required to compensate such Bank or such other corporation for the increased
cost to such Bank or such other corporation or the reduction in the rate of
return to such Bank or such other corporation as a result of such increase of
capital. In determining such additional amounts, each Bank will act reasonably
and in good faith and will use averaging and attribution methods which are
reasonable, provided that such Bank's determination of compensation owing under
this Section 1.10(c) shall, absent manifest error, be final and conclusive and
binding on all the parties hereto. Each Bank, upon determining that any
additional amounts will be payable pursuant to this Section 1.10(c), will give
prompt written notice thereof to the Borrower, which notice shall show in
reasonable detail the basis for calculation of such additional amounts.
1.11 Compensation. The Borrower shall compensate each Bank, upon its
written request (which request shall set forth in reasonable detail the basis
for requesting such compensation), for all losses, expenses and liabilities
(including, without limitation, any loss, expense or liability incurred by
reason of the liquidation or reemployment of deposits or other funds required by
such Bank to fund its Eurodollar Loans but excluding loss of anticipated
profits) which such Bank may sustain: (i) if for any reason (other than a
default by such Bank or the Agent) a Borrowing of, or conversion from or into,
Eurodollar Loans does not occur on a date specified therefor in a Notice of
Borrowing or Notice of Conversion (whether or not withdrawn by the Borrower or
deemed withdrawn pursuant to Section 1.10(a)); (ii) if any repayment (including
any repayment made pursuant to Section 4.01, Section 4.02 or as a result of an
acceleration of the Loans pursuant to Section 10) or conversion of any of its
Eurodollar Loans occurs on a date which is not the last day of an Interest
Period with respect thereto; (iii) if any prepayment of any of its Eurodollar
Loans is not made on any date specified in a notice of prepayment given by the
Borrower; or (iv) as a consequence of (x) any other default by the Borrower to
repay its Loans when required by the terms of this Agreement or any Note held by
such Bank or (y) any election made pursuant to Section 1.10(b).
1.12 Change of Lending Office. Each Bank agrees that upon the
occurrence of any event giving rise to the operation of Section 1.10(a)(ii) or
(iii), Section 1.10(c), Section 2.06 or Section 4.04 with respect to such Bank,
it will, if requested by the Borrower, use reasonable efforts (subject to
overall policy considerations of such Bank) to designate another lending office
for any Loans or Letters of Credit affected by such event, provided that such
designation is made on such terms that such Bank and its lending office suffer
no economic, legal or regulatory disadvantage, with the object of avoiding the
consequence of the event giving rise to the operation of such Section. Nothing
in this Section 1.12 shall affect or postpone any of the obligations of the
Borrower or the right of any Bank provided in Sections 1.10, 2.06 and 4.04.
1.13 Replacement of Banks. (x) If any Bank becomes a Defaulting
Bank or otherwise defaults in its obligations to make Loans, (y) upon the
occurrence of an event giving rise to the operation of Section 1.10(a)(ii) or
(iii), Section 1.10(c), Section 2.06 or Section 4.04 with respect to any Bank
which results in such Bank charging to the Borrower increased costs in excess of
those being generally charged by the other Banks or (z) in the case of a refusal
by a Bank to consent to certain proposed changes, waivers, discharges or
terminations with respect to this Agreement which have been approved by the
Required Banks as (and to the extent) provided in Section 13.12(b), the Borrower
shall have the right, if no Default or Event of Default then exists (or, in the
case of preceding clause (z), no Default or Event of Default will exist
immediately after giving effect to such replacement), to replace such Bank (the
"Replaced Bank") with one or more other Eligible Transferees, none of whom shall
constitute a Defaulting Bank at the time of such replacement (collectively, the
"Replacement Bank") and each of whom shall be required to be reasonably
acceptable to the Agent, provided that (i) at the time of any replacement pur
suant to this Section 1.13, the Replacement Bank shall enter into one or more
Assignment and Assumption Agreements pursuant to Section 13.04(b) (and with all
fees payable pursuant to said Section 13.04(b) to be paid by the Replacement
Bank) pursuant to which the Replacement Bank shall acquire the entire Revolving
Loan Commitment and outstanding Revolving Loans of, and participations in
Letters of Credit by, the Replaced Bank and, in connection therewith, shall pay
to (x) the Replaced Bank in respect thereof an amount equal to the sum of (I) an
amount equal to the principal of, and all accrued interest on, all outstanding
Revolving Loans of the Replaced Bank, (II) an amount equal to all Unpaid
Drawings that have been funded by (and not reimbursed to) such Replaced Bank,
together with all then unpaid interest with respect thereto at such time and
(III) an amount equal to all accrued, but theretofore unpaid, Fees owing to the
Replaced Bank pursuant to Section 3.01, (y) each Issuing Bank an amount equal to
such Replaced Bank's RL Percentage of any Unpaid Drawing (which at such time
remains an Unpaid Drawing) to the extent such amount was not theretofore funded
by such Replaced Bank to such Issuing Bank and (z) the Swingline Bank an amount
equal to such Replaced Bank's RL Percentage of any Mandatory Borrowings to the
extent such amount was not theretofore funded by such Replaced Bank to the
Swingline Bank and (ii) all obligations of the Borrower due and owing to the
Replaced Bank at such time (other than those specifically described in clause
(i) above in respect of which the assignment purchase price has been, or is
concurrently being, paid) shall be paid in full to such Replaced Bank
concurrently with such replacement. Upon the execution of the respective
Assignment and Assumption Agreement, the payment of amounts referred to in
clauses (i) and (ii) above and, if so requested by the Replacement Bank,
delivery to the Replacement Bank of the appropriate Revolving Note executed by
the Borrower, the Replacement Bank shall become a Bank hereunder and the
Replaced Bank shall cease to constitute a Bank hereunder, except with respect to
indemnification provisions under this Agreement (including, without limitation,
Sections 1.10, 1.11, 2.06, 4.04, 12.06 and 13.01), which shall survive as to
such Replaced Bank.
SECTION 2. Letters of Credit.
2.01 Letters of Credit. (a) Subject to and upon the terms and
conditions set forth herein, the Borrower may request that an Issuing Bank
issue, at any time and from time to time on and after the Restatement Effective
Date and prior to the 30th day prior to the Final Maturity Date, (x) for the
account of the Borrower and for the benefit of any holder (or any trustee, agent
or other similar representative for any such holders) of L/C Supportable
Obligations of the Borrower or any of its Subsidiaries, an irrevocable standby
letter of credit, in a form customarily used by such Issuing Bank or in such
other form as has been approved by such Issuing Bank and (y) for the account of
the Borrower and for the benefit of sellers of goods to the Borrower or any of
its Subsidiaries, an irrevocable trade letter of credit, in a form customarily
used by such Issuing Bank or in such other form as has been approved by such
Issuing Bank (each such letter of credit issued pursuant to this Section 2.01,
together with each letter of credit described in the second succeeding sentence,
a "Letter of Credit"). All Letters of Credit shall be denominated in Dollars
and shall be issued on a sight basis only; provided, however, with the consent
of the respective Issuing Bank, up to $10,000,000 of standby Letters of Credit
in the aggregate may be issued and outstanding at any time in Spanish Pesetas,
British Pounds Sterling, Deutsche Marks, Canadian Dollars and/or Australian
Dollars. It is hereby acknowledged and agreed that each of the letters of
credit described in Schedule VIII (the "Existing Letters of Credit") which were
issued under the Original Credit Agreement prior to the Restatement Effective
Date and which remain outstanding on such date, shall constitute a "Letter of
Credit" for all purposes of this Agreement.
(b) Subject to and upon the terms and conditions set forth herein,
each Issuing Bank agrees that it will, at any time and from time to time on and
after the Restatement Effective Date and prior to the 30th day prior to the
Final Maturity Date, following its receipt of the respective Letter of Credit
Request, issue for the account of the Borrower, one or more Letters of Credit as
are permitted to remain outstanding hereunder without giving rise to a Default
or an Event of Default, provided that no Issuing Bank shall be under any
obligation to issue any Letter of Credit of the types described above if at the
time of such issuance:
(i) any order, judgment or decree of any governmental authority or
arbitrator shall purport by its terms to enjoin or restrain such Issuing
Bank from issuing such Letter of Credit or any requirement of law
applicable to such Issuing Bank or any request or directive (whether or not
having the force of law) from any governmental authority with jurisdiction
over such Issuing Bank shall prohibit, or request that such Issuing Bank
refrain from, the issuance of letters of credit generally or such Letter of
Credit in particular or shall impose upon such Issuing Bank with respect to
such Letter of Credit any restriction or reserve or capital requirement
(for which such Issuing Bank is not otherwise compensated) not in effect on
the Effective Date, or any unreimbursed loss, cost or expense which was not
applicable or in effect with respect to such Issuing Bank as of the date
hereof and which such Issuing Bank reasonably and in good faith deems
material to it; or
(ii) such Issuing Bank shall have received notice from the Borrower or
the Required Banks prior to the issuance of such Letter of Credit of the
type described in the second sentence of Section 2.03(b).
(c) Each Issuing Bank agrees to provide to the Agent by facsimile
promptly on the first Business Day of each week the daily aggregate Stated
Amount of all Letters of Credit issued by such Issuing Bank and outstanding
during the immediately preceding week.
2.02 Maximum Letter of Credit Outstandings; Final Maturities.
Notwithstanding anything to the contrary contained in this Agreement, (i) no
Letter of Credit shall be issued the Stated Amount of which, when added to the
Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid on
the date of, and prior to the issuance of, the respective Letter of Credit) at
such time would exceed either (x) $25,000,000 or (y) when added to the sum of
(I) the aggregate principal amount of all Revolving Loans then outstanding and
(II) the aggregate principal amount of all Swingline Loans then outstanding, an
amount equal to the lesser of (A) the Borrowing Base at such time (based on the
Borrowing Base Certificate last delivered) and (B) the Total Revolving Loan
Commitment at such time and (ii) each Letter of Credit shall by its terms
terminate on or before the earlier of (x) (A) in the case of standby Letters of
Credit, the date which occurs 12 months after the date of the issuance thereof
(although any such standby Letter of Credit may be extendable for successive
periods of up to 12 months, but not beyond the third Business Day prior to the
Final Maturity Date, on terms acceptable to such Issuing Bank) and (B) in the
case of trade Letters of Credit, the date which occurs 180 days after the date
of the issuance thereof and (y) three Business Days (or 30 days in the case of a
trade Letter of Credit) prior to the Final Maturity Date.
2.03 Letter of Credit Requests; Minimum Stated Amount. (a) Whenever
the Borrower desires that a Letter of Credit be issued for its account, the
Borrower shall give the Agent and the respective Issuing Bank at least five
Business Days' (or such shorter period as is acceptable to such Issuing Bank)
written notice thereof. Each notice shall be in the form of Exhibit C (each a
"Letter of Credit Request").
(b) The making of each Letter of Credit Request shall be deemed to be
a representation and warranty by the Borrower that such Letter of Credit may be
issued in accordance with, and will not violate the requirements of, Section
2.02. Unless the respective Issuing Bank has received notice from the Borrower
or the Required Banks before it issues a Letter of Credit that one or more of
the conditions specified in Section 5 or 6 are not then satisfied, or that the
issuance of such Letter of Credit would violate Section 2.02, then such Issuing
Bank shall, subject to the terms and conditions of this Agreement, issue the
requested Letter of Credit for the account of the Borrower in accordance with
such Issuing Bank's usual and customary practices. Upon its issuance of or
amendment to any standby Letter of Credit, the respective Issuing Bank shall
promptly notify the Borrower, each Participant and the Agent of such issuance or
amendment and such notification shall be accompanied by a copy of the issued
standby Letter of Credit or amendment. Notwithstanding anything to the contrary
contained in this Agreement, in the event that a Bank Default exists, no Issuing
Bank shall be required to issue any Letter of Credit unless such Issuing Bank
has entered into an arrangement satisfactory to it and the Borrower to eliminate
such Issuing Bank's risk with respect to the participation in Letters of Credit
by the Defaulting Bank or Banks, including by cash collateralizing such
Defaulting Bank's or Banks' RL Percentage of the Letter of Credit Outstandings.
(c) The initial Stated Amount of each Letter of Credit shall not be
less than $100,000 (or, in the case of a Letter of Credit issued in a currency
other than Dollars, the Dollar Equivalent thereof) or such lesser amount as is
acceptable to the respective Issuing Bank.
2.04 Letter of Credit Participations. (a) Immediately upon the
issuance by each Issuing Bank of any Letter of Credit, such Issuing Bank shall
be deemed to have sold and transferred to each Bank, other than such Issuing
Bank (each such Bank, in its capacity under this Section 2.04, a "Participant"),
and each such Participant shall be deemed irrevocably and unconditionally to
have purchased and received from such Issuing Bank, without recourse or
warranty, an undivided interest and participation, to the extent of such
Participant's RL Percentage, in such Letter of Credit, each drawing or payment
made thereunder and the obligations of the Borrower under this Agreement with
respect thereto, and any security therefor or guaranty pertaining thereto. Upon
any change in the Revolving Loan Commitments or RL Percentages of the Banks
pursuant to Section 1.13 or 13.04, it is hereby agreed that, with respect to all
outstanding Letters of Credit and Unpaid Drawings, there shall be an automatic
adjustment to the participations pursuant to this Section 2.04 to reflect the
new RL Percentages of the assignor and assignee Bank, as the case may be.
(b) In determining whether to pay under any Letter of Credit issued
by it, no Issuing Bank shall have an obligation relative to the other Banks
other than to confirm that any documents required to be delivered under such
Letter of Credit appear to have been delivered and that they appear to
substantially comply on their face with the requirements of such Letter of
Credit. Any action taken or omitted to be taken by any Issuing Bank under or in
connection with any Letter of Credit issued by it if taken or omitted in the
absence of gross negligence or willful misconduct (as finally determined by a
court of competent jurisdiction), shall not create for such Issuing Bank any
resulting liability to the Borrower, any other Credit Party, any Bank or any
other Person.
(c) In the event that any Issuing Bank makes any payment under any
Letter of Credit issued by it and the Borrower shall not have reimbursed such
amount in full to such Issuing Bank pursuant to Section 2.05(a), such Issuing
Bank shall promptly notify the Agent, which shall promptly notify each
Participant of such failure, and, except as provided in the proviso of the
immediately succeeding sentence, each Participant shall promptly and
unconditionally pay to such Issuing Bank the amount of such Participant's RL
Percentage of such unreimbursed payment in Dollars (or, in the case of any
unreimbursed payment made in a currency other than Dollars, of the Dollar
Equivalent of such unreimbursed payment, as determined by the respective Issuing
Bank on the date on which such unreimbursed payment was made by such Issuing
Bank) and in same day funds. If the Agent so notifies, prior to 11:00 A.M.
(New York time) on any Business Day, any Participant required to fund a payment
under a Letter of Credit, such Participant shall make available to the
respective Issuing Bank in Dollars (or, in the case of any unreimbursed payment
made in a currency other than Dollars, of the Dollar Equivalent thereof) such
Participant's RL Percentage of the amount of such payment on such Business Day
in same day funds; provided, however, that no Participant shall be obligated to
pay to the respective Issuing Bank its RL Percentage of such unreimbursed amount
for any wrongful payment made by such Issuing Bank under a Letter of Credit
issued by it as a result of acts or omissions constituting willful misconduct or
gross negligence on the part of such Issuing Bank (as finally determined by a
court of competent jurisdiction.) If and to the extent such Participant shall
not have so made its RL Percentage of the amount of such payment available to
the respective Issuing Bank, such Participant agrees to pay to such Issuing
Bank, forthwith on demand such amount, together with interest thereon, for each
day from such date until the date such amount is paid to such Issuing Bank at
the overnight Federal Funds Rate for the first three days and at the interest
rate applicable to Base Rate Loans for each day thereafter. The failure of any
Participant to make available to the respective Issuing Bank its RL Percentage
of any payment under any Letter of Credit shall not relieve any other
Participant of its obligation hereunder to make available to such Issuing Bank
its RL Percentage of any Letter of Credit on the date required, as specified
above, but no Participant shall be responsible for the failure of any other
Participant to make available to such Issuing Bank such other Participant's RL
Percentage of any such payment.
(d) Whenever an Issuing Bank receives a payment of a reimbursement
obligation as to which it has received any payments from the Participants
pursuant to clause (c) above, such Issuing Bank shall pay to each Participant
which has paid its RL Percentage thereof, in Dollars (or, in the case of any
payment received in a currency other than Dollars, of the Dollar Equivalent
thereof) and in same day funds, an amount equal to such Participant's share
(based upon the proportionate aggregate amount originally funded by such
Participant to the aggregate amount funded by all Participants) of the principal
amount of such reimbursement obligation and interest thereon accruing after the
purchase of the respective participations.
(e) Upon the request of any Participant, each Issuing Bank shall
furnish to such Participant copies of any standby Letter of Credit issued by it
and such other documentation as may reasonably be requested by such Participant.
(f) The obligations of the Participants to make payments to each
Issuing Bank with respect to Letters of Credit issued by it shall be irrevocable
and not subject to any qualification or exception whatsoever (except as
otherwise provided in the proviso to the second sentence of Section 2.04(c)) and
shall be made in accordance with the terms and conditions of this Agreement
under all circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this Agreement or any
of the other Credit Documents;
(ii) the existence of any claim, setoff, defense or other right which
the Borrower or any of its Subsidiaries may have at any time against a
beneficiary named in a Letter of Credit, any transferee of any Letter of
Credit (or any Person for whom any such transferee may be acting), the
Agent, any Issuing Bank, any Participant, or any other Person, whether in
connection with this Agreement, any Letter of Credit, the transactions
contemplated herein or any unrelated transactions (including any underlying
transaction between the Borrower or any Subsidiary of the Borrower and the
beneficiary named in any such Letter of Credit);
(iii) any draft, certificate or any other document presented under
any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the performance
or observance of any of the terms of any of the Credit Documents; or
(v) the occurrence of any Default or Event of Default.
2.05 Agreement to Repay Letter of Credit Drawings. (a) The Borrower
agrees to reimburse each Issuing Bank, by making payment to the Agent in Dollars
(or, in the case of any payment or disbursement made by such Issuing Bank in a
currency other than Dollars, of the Dollar Equivalent of such payment or
disbursement as determined by such Issuing Bank on the date of such payment or
disbursement) and in immediately available funds at the Payment Office, for any
payment or disbursement made by such Issuing Bank under any Letter of Credit
issued by it (each such amount (or the Dollar Equivalent thereof, as the case
may be), so paid until reimbursed, an "Unpaid Drawing"), not later than one
Business Day following receipt by the Borrower of notice of such payment or
disbursement (provided that no such notice shall be required to be given if a
Default or an Event of Default under Section 10.05 shall have occurred and be
continuing, in which case the Unpaid Drawing shall be due and payable
immediately without presentment, demand, protest or notice of any kind (all of
which are hereby waived by the Borrower)), with interest on the amount so paid
or disbursed by such Issuing Bank, to the extent not reimbursed prior to 12:00
Noon (New York time) on the date of such payment or disbursement, from and
including the date paid or disbursed to but excluding the date such Issuing Bank
was reimbursed by the Borrower therefor at a rate per annum which shall be the
Base Rate in effect from time to time; provided, however, to the extent such
amounts are not reimbursed prior to 12:00 Noon (New York time) on the third
Business Day following the receipt by the Borrower of notice of such payment or
disbursement or following the occurrence of a Default or an Event of Default
under Section 10.05, interest shall thereafter accrue on the amounts so paid or
disbursed by such Issuing Bank (and until reimbursed by the Borrower) at a rate
per annum which shall be the Base Rate in effect from time to time plus 2%, in
each such case, with interest to be payable on demand. Each Issuing Bank shall
give the Borrower prompt written notice of each Drawing under any Letter of
Credit issued by it, provided that the failure to give any such notice shall in
no way affect, impair or diminish the Borrower's obligations hereunder.
(b) The obligations of the Borrower under this Section 2.05 to
reimburse each Issuing Bank with respect to Unpaid Drawings (including, in each
case, interest thereon) shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to payment
which the Borrower may have or have had against any Bank (including in its
capacity as issuer of the Letter of Credit or as Participant), including,
without limitation, any defense based upon the failure of any drawing or payment
under a Letter of Credit (each a "Drawing") to conform to the terms of the
Letter of Credit or any nonapplication or misapplication by the beneficiary of
the proceeds of such Drawing; provided, however, that the Borrower shall not be
obligated to reimburse the respective Issuing Bank for any wrongful payment made
by such Issuing Bank under a Letter of Credit issued by it as a result of acts
or omissions constituting willful misconduct or gross negligence on the part of
such Issuing Bank (as finally determined by a court of competent jurisdiction).
2.06 Increased Costs. If at any time after the Effective Date, the
introduction of or any change in any applicable law, rule, regulation, order,
guideline or request or in the interpretation or administration thereof by the
NAIC or any governmental authority charged with the interpretation or
administration thereof, or compliance by any Issuing Bank or any Participant
with any request or directive by the NAIC or by any such authority (whether or
not having the force of law), shall either (i) impose, modify or make applicable
any reserve, deposit, capital adequacy or similar requirement against letters of
credit issued by any Issuing Bank or participated in by any Participant, or (ii)
impose on any Issuing Bank or any Participant any other conditions relating,
directly or indirectly, to this Agreement; and the result of any of the
foregoing is to increase the cost to any Issuing Bank or any Participant of
issuing, maintaining or participating in any Letter of Credit, or reduce the
amount of any sum received or receivable by any Issuing Bank or any Participant
hereunder or reduce the rate of return on its capital with respect to Letters of
Credit (except for changes in the rate of tax on, or determined by reference to,
the net income or profits of such Issuing Bank or such Participant pursuant to
the laws of the jurisdiction in which it is organized or in which its principal
office or applicable lending office is located or any subdivision thereof or
therein), then, upon the delivery of the certificate referred to below to the
Borrower by such Issuing Bank or such Participant (a copy of which certificate
shall be sent by such Issuing Bank or such Participant to the Agent), the
Borrower shall pay to such Issuing Bank or such Participant such additional
amount or amounts as will compensate such Issuing Bank or such Participant for
such increased cost or reduction in the amount receivable or reduction on the
rate of return on its capital. Each Issuing Bank or Participant, upon
determining that any additional amounts will be payable to it pursuant to this
Section 2.06, will give prompt written notice thereof to the Borrower, which
notice shall include a certificate submitted to the Borrower by such Issuing
Bank or such Participant (a copy of which certificate shall be sent by such
Issuing Bank or such Participant to the Agent), setting forth in reasonable
detail the basis for the calculation of such additional amount or amounts
necessary to compensate such Issuing Bank or such Participant. The certificate
required to be delivered pursuant to this Section 2.06 shall, absent manifest
error, be final and conclusive and binding on the Borrower.
SECTION 3. Commitment Commission; Fees; Reductions of Commitment.
3.01 Fees. (a) The Borrower agrees to pay to the Agent for
distribution to each Non-Defaulting Bank, a commitment commission (the
"Commitment Commission") for the period from and including the Effective Date to
but excluding the Final Maturity Date (or such earlier date on which the Total
Revolving Loan Commitment shall have been terminated), computed at a rate for
each day equal to 1/4 of 1% per annum on the daily average Unutilized Revolving
Loan Commitment of such Non-Defaulting Bank. Accrued Commitment Commission
shall be due and payable quarterly in arrears on each Quarterly Payment Date and
on the Final Maturity Date (or such earlier date on which the Total Revolving
Loan Commitment shall have been terminated).
(b) The Borrower agrees to pay to the Agent for distribution to each
Bank (based on each such Bank's respective RL Percentage) a fee in respect of
each Letter of Credit issued hereunder (the "Letter of Credit Fee") for the
period from and including the date of issuance of such Letter of Credit to and
including the date of termination or expiration of such Letter of Credit,
computed at a rate per annum equal to the Applicable Eurodollar Rate Margin then
in effect on the daily Stated Amount of such Letter of Credit. Accrued Letter of
Credit Fees shall be due and payable quarterly in arrears on each Quarterly
Payment Date and on the first day after the termination of the Total Revolving
Loan Commitment upon which no Letters of Credit remain outstanding.
(c) The Borrower agrees to pay to each Issuing Bank, for its own
account, a facing or fronting fee in respect of each Letter of Credit issued by
such Issuing Bank hereunder upon such terms and conditions as are separately
agreed to between such Issuing Bank and the Borrower.
(d) The Borrower agrees to pay to each Issuing Bank, for its own
account, upon each payment under, issuance of, or amendment to, any Letter of
Credit, such amount as shall at the time of such event be the administrative
charge and the reasonable expenses which such Issuing Bank is generally imposing
in connection with such occurrence with respect to letters of credit.
(e) The Borrower agrees to pay to the Agent, for its own account,
such other fees as have been agreed to in writing by the Borrower and the Agent.
(f) Fees which accrued under the Original Credit Agreement prior to
the Restatement Effective Date but which remain unpaid on such date (and which
were not required to be paid on or prior to such date in accordance with the
terms of the Original Credit Agreement or this Agreement) shall be payable at
the times otherwise provided above (but calculated at the respective rates
provided in the Original Credit Agreement for periods occurring prior to the
Restatement Effective Date) for the respective Fees involved.
3.02 Voluntary Termination of Unutilized Commitments. (a) Upon at
least one Business Day's prior written notice to the Agent at the Notice Office
(which notice the Agent shall promptly transmit to each of the Banks), the
Borrower shall have the right, at any time or from time to time, without premium
or penalty, to terminate the Total Unutilized Revolving Loan Commitment, in
whole or in part, pursuant to this Section 3.02(a), in an integral multiple of
$1,000,000, in the case of partial reductions to the Total Unutilized Revolving
Loan Commitment, provided that each such reduction shall apply proportionately
to permanently reduce the Revolving Loan Commitment of each Bank.
(b) In the event of a refusal by a Bank to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Banks as (and to the extent)
provided in Section 13.12(b), the Borrower may, subject to its compliance with
the requirements of Section 13.12(b), upon five Business Days' prior written
notice to the Agent at the Notice Office (which notice the Agent shall promptly
transmit to each of the Banks) terminate the Revolving Loan Commitment of such
Bank, so long as all Revolving Loans, together with accrued and unpaid interest,
Fees and all other amounts, owing to such Bank are repaid concurrently with the
effectiveness of such termination pursuant to Section 4.01(b) (at which time
Schedule I shall be deemed modified to reflect such changed amounts), and at
such time, such Bank shall no longer constitute a "Bank" for purposes of this
Agreement, except with respect to indemnifications under this Agreement
(including, without limitation, Sections 1.10, 1.11, 2.06, 4.04, 12.06 and
13.01), which shall survive as to such repaid Bank.
3.03 Mandatory Reduction of Commitments. (a) The Total Revolving
Loan Commitment (and the Revolving Loan Commitment of each Bank) shall terminate
in their entirety on March 31, 1998 unless the Restatement Effective Date has
occurred on or before such date, and in the event of such termination this
Agreement shall cease to be of any force or effect and the Original Credit
Agreement shall continue to be effective, as the same may have been, or may
thereafter be, amended, modified or supplemented from time to time.
(b) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, on each date on or after the Restatement Effective Date on
which the Borrower or any of its Subsidiaries receives Cash Proceeds from any
Asset Sale, the Total Revolving Loan Commitment shall be permanently reduced on
such date by an amount equal to 100% of the Net Sale Proceeds from such Asset
Sale, provided that such Net Sale Proceeds shall not give rise to a reduction to
the Total Revolving Loan Commitment pursuant to this Section 3.03(b) on such
date to the extent that no Default or Event of Default then exists and such Net
Sale Proceeds shall be used to purchase assets used or to be used in the
businesses permitted pursuant to Section 9.14 (including, without limitation
(but only to the extent permitted by Section 9.02), the purchase of the assets
or 100% of the capital stock of a Person engaged in such businesses) within 270
days following the date of receipt of such Net Sale Proceeds from such Asset
Sale, and provided further, that if all or any portion of such Net Sale Proceeds
are not so used within such 270 day period (or such earlier date, if any, as the
Board of Directors of the Borrower or such Subsidiary, as the case may be,
determines not to reinvest such Net Sale Proceeds), the Total Revolving Loan
Commitment shall be permanently reduced on the last day of such period (or such
earlier date, as the case may be) by an amount equal to such remaining portion.
(c) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, on each date on or after the Restatement Effective Date on
which the Borrower or any of its Subsidiaries receives any cash proceeds from
any incurrence of Indebtedness for borrowed money (other than Indebtedness
permitted to be incurred pursuant to Section 9.04 as such Section is in effect
on the Restatement Effective Date) by the Borrower or any of its Subsidiaries,
the Total Revolving Loan Commitment shall be permanently reduced on such date by
an amount equal to 100% of the Net Debt Proceeds of the respective incurrence of
Indebtedness.
(d) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, within 10 days following each date on or after the
Restatement Effective Date on which the Borrower or any of its Subsidiaries
receives any cash proceeds from any Recovery Event, the Total Revolving Loan
Commitment shall be permanently reduced on such date by an amount equal to 100%
of the Net Insurance Proceeds of such Recovery Event, provided that so long as
no Default or Event of Default then exists and such proceeds from such Recovery
Event do not exceed $10,000,000, such proceeds shall not give rise to a
reduction to the Total Revolving Loan Commitment pursuant to this Section
3.03(d) on such date to the extent that the Borrower has delivered a certificate
to the Agent on or prior to such date stating that such proceeds shall be used
to replace or restore any properties or assets in respect of which such proceeds
were paid within 270 days following the date of receipt of such proceeds (which
certificate shall set forth the estimates of the proceeds to be so expended),
and provided further, that (i) if the amount of such proceeds exceeds
$10,000,000, then the Total Revolving Loan Commitment shall be reduced by the
entire amount of such proceeds and not just the portion in excess of $10,000,000
as provided above in this Section 3.03(d), and (ii) if all or any portion of
such proceeds are not so used within such 270 day period (or such earlier date,
if any, as the Board of Directors of the Borrower or such Subsidiary, as the
case may be, determines not to reinvest such Net Insurance Proceeds), the Total
Revolving Loan Commitment shall be permanently reduced on the last day of such
period (or such earlier date, as the case may be) by an amount equal to such
remaining portion.
(e) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total Revolving Loan Commitment (and the Revolving
Loan Commitment of each Bank) shall terminate in its entirety on the earlier of
(i) the date on which a Change of Control occurs and (ii) the Final Maturity
Date.
(f) Each reduction to the Total Revolving Loan Commitment pursuant to
this Section 3.03 shall apply proportionately to reduce the Revolving Loan
Commitment of each Bank.
SECTION 4. Prepayments; Payments; Taxes.
4.01 Voluntary Prepayments. (a) The Borrower shall have the right
to prepay the Loans, without premium or penalty, in whole or in part at any time
and from time to time on the following terms and conditions: (i) the Borrower
shall give the Agent prior to 12:00 Noon (New York time) at the Notice Office
(x) at least one Business Day's prior written notice (or telephonic notice
promptly confirmed in writing) of its intent to prepay Base Rate Loans (or same
day notice in the case of a prepayment of Swingline Loans) and (y) at least
three Business Days' prior written notice (or telephonic notice promptly
confirmed in writing) of its intent to prepay Eurodollar Loans, the amount of
such prepayment and the Types of Loans to be prepaid and, in the case of
Eurodollar Loans, the specific Borrowing or Borrowings pursuant to which made,
which notice the Agent shall, except in the case of Swingline Loans, promptly
transmit to each of the Banks; (ii) each prepayment of Revolving Loans pursuant
to this Section 4.01(a) shall be in an aggregate principal amount of at least
$500,000 and each prepayment of Swingline Loans pursuant to this Section 4.01(a)
shall be in an aggregate principal amount of at least $50,000, provided that if
any partial prepayment of Eurodollar Loans made pursuant to any Borrowing shall
reduce the outstanding principal amount of Eurodollar Loans made pursuant to
such Borrowing to an amount less than the Minimum Borrowing Amount applicable
thereto, then such Borrowing may not be continued as a Borrowing of Eurodollar
Loans and any election of an Interest Period with respect thereto given by the
Borrower shall have no force or effect; and (iii) each prepayment pursuant to
this Section 4.01(a) in respect of any Revolving Loans made pursuant to a
Borrowing shall be applied pro rata among such Revolving Loans, provided that at
the Borrower's election in connection with any prepayment of Revolving Loans
pursuant to this Section 4.01(a), such prepayment shall not be applied to any
Revolving Loan of a Defaulting Bank.
(b) In the event of a refusal by a Bank to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Banks as (and to the extent)
provided in Section 13.12(b), the Borrower may, upon five Business Days' prior
written notice to the Agent at the Notice Office (which notice the Agent shall
promptly transmit to each of the Banks), repay all Revolving Loans of such Bank,
together with accrued and unpaid interest, Fees and other amounts owing to such
Bank in accordance with, and subject to the requirements of, said
Section 13.12(b) so long as (A) the Revolving Loan Commitment of such Bank is
terminated concurrently with such repayment pursuant to Section 3.02(b) (at
which time Schedule I shall be deemed modified to reflect the changed Revolving
Loan Commitments) and (B) the consents, if any, required under Section 13.12(b)
in connection with the repayment pursuant to this clause (b) have been obtained.
4.02 Mandatory Repayments. (a) (i) On any day on which the sum of
(I) the aggregate outstanding principal amount of all Revolving Loans (after
giving effect to all other repayments thereof on such date), (II) the aggregate
outstanding principal amount of all Swingline Loans (after giving effect to all
other repayments thereof on such date) and (III) the aggregate amount of all
Letter of Credit Outstandings exceeds either (A) the Borrowing Base at such time
(based on the Borrowing Base Certificate last delivered) or (B) the Total
Revolving Loan Commitment as then in effect, the Borrower shall prepay on such
day the principal of Swingline Loans and, after all Swingline Loans have been
repaid in full, Revolving Loans in an amount equal to such excess. If, after
giving effect to the prepayment of all outstanding Swingline Loans and Revolving
Loans, the aggregate amount of the Letter of Credit Outstandings exceeds either
(A) the Borrowing Base at such time (based on the Borrowing Base Certificate
last delivered) or (B) the Total Revolving Loan Commitment as then in effect,
the Borrower shall pay to the Agent at the Payment Office on such day an amount
of cash and/or Cash Equivalents equal to the amount of such excess (up to a
maximum amount equal to the Letter of Credit Outstandings at such time), such
cash and/or Cash Equivalents to be held as security for all obligations of the
Borrower to the Issuing Banks and the Banks hereunder in a cash collateral
account to be established by the Agent.
(ii) On any day on which the aggregate amount of all Letter of Credit
Outstandings exceeds $25,000,000, the Borrower shall pay to the Agent at the
Payment Office on such day an amount of cash and/or Cash Equivalents equal to
the amount of such excess, such cash and/or Cash Equivalents to be held as
security for all obligations of the Borrower to the Issuing Banks and the Banks
hereunder in a cash collateral account to be established by the Agent.
(iii) On any day on which Letters of Credit issued in a currency
other than Dollars are outstanding and the aggregate amount of all Letter of
Credit Outstandings in respect of all non-Dollar denominated Letters of Credit
exceeds $10,000,000, the Borrower shall pay to the Agent at the Payment Office
on such day an amount of cash and/or Cash Equivalents equal to the amount of
such excess, such cash and/or Cash Equivalents to be held as security for all
obligations of the Borrower to the Issuing Banks and the Banks hereunder in a
cash collateral account to established by the Agent.
(b) With respect to each repayment of Revolving Loans required by
this Section 4.02, the Borrower may designate the Types of Revolving Loans which
are to be repaid and, in the case of Eurodollar Loans, the specific Borrowing or
Borrowings pursuant to which made, provided that: (i) repayments of Eurodollar
Loans pursuant to this Section 4.02 may only be made on the last day of an
Interest Period applicable thereto unless all Eurodollar Loans with Interest
Periods ending on such date of required repayment and all Base Rate Loans have
been paid in full; (ii) if any repayment of Eurodollar Loans made pursuant to a
single Borrowing shall reduce the outstanding Eurodollar Loans made pursuant to
such Borrowing to an amount less than the Minimum Borrowing Amount applicable
thereto, such Borrowing shall be converted at the end of the then current
Interest Period into a Borrowing of Base Rate Loans; and (iii) each repayment of
any Revolving Loans made pursuant to a Borrowing shall be applied pro rata among
such Revolving Loans. In the absence of a designation by the Borrower as
described in the preceding sentence, the Agent shall, subject to the above, make
such designation in its sole discretion.
(c) Notwithstanding anything to the contrary contained in this
Agreement or in any other Credit Document, (i) all then outstanding Revolving
Loans shall be repaid in full on the Final Maturity Date, (ii) all then
outstanding Swingline Loans shall be repaid in full on the Swingline Expiry Date
and (iii) all then outstanding Loans shall be repaid in full on the date on
which a Change of Control occurs.
4.03 Method and Place of Payment. Except as otherwise specifically
provided herein, all payments under this Agreement or under any Note shall be
made to the Agent for the account of the Bank or Banks entitled thereto not
later than 12:00 Noon (New York time) on the date when due and shall be made in
Dollars in immediately available funds at the Payment Office. Whenever any
payment to be made hereunder or under any Note shall be stated to be due on a
day which is not a Business Day, the due date thereof shall be extended to the
next succeeding Business Day and, with respect to payments of principal,
interest shall be payable at the applicable rate during such extension.
4.04 Net Payments. (a) All payments made by the Borrower hereunder
or under any Note will be made without setoff, counterclaim or other defense.
Except as provided in Section 4.04(b), all such payments will be made free and
clear of, and without deduction or withholding for, any present or future taxes,
levies, imposts, duties, fees, assessments or other charges of whatever nature
now or hereafter imposed by any jurisdiction or by any political subdivision or
taxing authority thereof or therein with respect to such payments (but
excluding, except as provided in the second succeeding sentence, any tax imposed
on or measured by the net income or net profits of a Bank pursuant to the laws
of the jurisdiction in which it is organized or the jurisdiction in which the
principal office or applicable lending office of such Bank is located or any
subdivision thereof or therein) and all interest, penalties or similar
liabilities with respect to such non-excluded taxes, levies, imposts, duties,
fees, assessments or other charges (all such non-excluded taxes, levies,
imposts, duties, fees, assessments or other charges being referred to
collectively as "Taxes"). If any Taxes are so levied or imposed, the Borrower
agrees to pay the full amount of such Taxes, and such additional amounts as may
be necessary so that every payment of all amounts due under this Agreement or
under any Note, after withholding or deduction for or on account of any Taxes,
will not be less than the amount provided for herein or in such Note. If any
amounts are payable in respect of Taxes pursuant to the preceding sentence, the
Borrower agrees to reimburse each Bank, upon the written request of such Bank,
for taxes imposed on or measured by the net income or net profits of such Bank
pursuant to the laws of the jurisdiction in which such Bank is organized or in
which the principal office or applicable lending office of such Bank is located
or under the laws of any political subdivision or taxing authority of any such
jurisdiction in which such Bank is organized or in which the principal office or
applicable lending office of such Bank is located and for any withholding of
taxes as such Bank shall determine are payable by, or withheld from, such Bank,
in respect of such amounts so paid to or on behalf of such Bank pursuant to the
preceding sentence and in respect of any amounts paid to or on behalf of such
Bank pursuant to this sentence. The Borrower will furnish to the Agent within
45 days after the date the payment of any Taxes is due pursuant to applicable
law certified copies of tax receipts evidencing such payment by the Borrower.
The Borrower agrees to indemnify and hold harmless each Bank, and reimburse such
Bank upon its written request, for the amount of any Taxes so levied or imposed
and paid by such Bank.
(b) Each Bank that is not a United States person (as such term is
defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax purposes
agrees to deliver to the Borrower and the Agent on or prior to the Restatement
Effective Date, or in the case of a Bank that is an assignee or transferee of an
interest under this Agreement pursuant to Section 1.13 or 13.04 (unless the
respective Bank was already a Bank hereunder immediately prior to such
assignment or transfer), on the date of such assignment or transfer to such
Bank, (i) two accurate and complete original signed copies of Internal Revenue
Service Form 4224 or 1001 (or successor forms) certifying to such Bank's
entitlement to a complete exemption from United States withholding tax with
respect to payments to be made under this Agreement and under any Note, or (ii)
if the Bank is not a "bank" within the meaning of Section 881(c)(3)(A) of the
Code and cannot deliver either Internal Revenue Service Form 1001 or 4224
pursuant to clause (i) above, (x) a certificate substantially in the form of
Exhibit D (any such certificate, a "Section 4.04(b)(ii) Certificate") and
(y) two accurate and complete original signed copies of Internal Revenue Service
Form W-8 (or successor form) certifying to such Bank's entitlement to a complete
exemption from United States withholding tax with respect to payments of
interest to be made under this Agreement and under any Note. In addition, each
Bank agrees that from time to time after the Restatement Effective Date, when a
lapse in time or change in circumstances renders the previous certification
obsolete or inaccurate in any material respect, such Bank will deliver to the
Borrower and the Agent two new accurate and complete original signed copies of
Internal Revenue Service Form 4224 or 1001 (or successor forms), or Form W-8 (or
successor form) and a Section 4.04(b)(ii) Certificate, as the case may be, and
such other forms as may be required in order to confirm or establish the
entitlement of such Bank to a continued exemption from or reduction in United
States withholding tax with respect to payments under this Agreement and any
Note, or such Bank shall immediately notify the Borrower and the Agent of its
inability to deliver any such Form or Certificate, in which case such Bank shall
not be required to deliver any such Form or Certificate pursuant to this Section
4.04(b). Notwithstanding anything to the contrary contained in Section 4.04(a),
but subject to Section 13.04(b) and the immediately succeeding sentence, (x) the
Borrower shall be entitled, to the extent it is required to do so by law, to
deduct or withhold income or similar taxes imposed by the United States (or any
political subdivision or taxing authority thereof or therein) from interest,
Fees or other amounts payable hereunder for the account of any Bank which is not
a United States person (as such term is defined in Section 7701(a)(30) of the
Code) for U.S. Federal income tax purposes to the extent that such Bank has not
provided to the Borrower U.S. Internal Revenue Service Forms that establish a
complete exemption from such deduction or withholding and (y) the Borrower shall
not be obligated pursuant to Section 4.04(a) hereof to gross-up payments to be
made to a Bank in respect of income or similar taxes imposed by the United
States if (I) such Bank has not provided to the Borrower the Internal Revenue
Service Forms required to be provided to the Borrower pursuant to this Section
4.04(b) or (II) in the case of a payment, other than interest, to a Bank
described in clause (ii) above, to the extent that such Forms do not establish a
complete exemption from withholding of such taxes. Notwithstanding anything to
the contrary contained in the preceding sentence or elsewhere in this Section
4.04 and except as set forth in Section 13.04(b), the Borrower agrees to pay any
additional amounts and to indemnify each Bank in the manner set forth in Section
4.04(a) (without regard to the identity of the jurisdiction requiring the
deduction or withholding) in respect of any Taxes deducted or withheld by it as
described in the immediately preceding sentence as a result of any changes after
the Effective Date in any applicable law, treaty, governmental rule, regulation,
guideline or order, or in the interpretation thereof, relating to the deducting
or withholding of such Taxes.
SECTION 5. Conditions Precedent to the Restatement Effective Date.
The occurrence of the Restatement Effective Date pursuant to Section 13.10 is
subject to the satisfaction of the following conditions:
5.01 Execution of Agreement; Notes On or prior to the Restatement
Effective Date, (i) this Agreement shall have been executed and delivered as
provided in Section 13.10 and (ii) there shall have been delivered to the Agent
for the account of each of the Banks the appropriate Revolving Note executed by
the Borrower and to the Swingline Bank, the Swingline Note executed by the
Borrower, in each case, in the amount, maturity and as otherwise provided
herein.
5.02 Officer's Certificate. On the Restatement Effective Date, the
Agent shall have received a certificate, dated the Restatement Effective Date
and signed on behalf of the Borrower by the Chairman of the Board, the Chief
Executive Officer, the President or any Vice President of the Borrower,
certifying on behalf of the Borrower that all of the conditions in Sections
5.05, 5.06, 5.07 and 6.02 have been satisfied on such date.
5.03 Opinions of Counsel. On the Restatement Effective Date, the
Agent shall have received (i) from Abrahams Kaslow and Cassman, special counsel
to the Credit Parties, an opinion addressed to the Agent, the Collateral Agent
and each of the Banks and dated the Restatement Effective Date covering the
matters set forth in Exhibit E-1 and such other matters incident to the
transactions contemplated herein as the Agent may reasonably request, (ii) from
the Corporate Counsel of the Borrower, an opinion addressed to the Agent, the
Collateral Agent and each of the Banks and dated the Restatement Effective Date
covering the matters set forth in Exhibit E-2 and such other matters incident to
the transactions contemplated herein as the Agent may reasonably request, and
(iii) from the respective counsel to the Credit Parties, reliance letters
entitling the Agent and the Banks to rely on the opinions of counsel delivered
on behalf of the Credit Parties in connection with the issuance of the Senior
Subordinated Notes.
5.04 Corporate Documents; Proceedings; etc. (a) On the Restatement
Effective Date, the Agent shall have received a certificate from each Credit
Party, dated the Restatement Effective Date, signed on behalf of such Credit
Party by the Chairman of the Board, the Chief Executive Officer, the President
or any Vice President of such Credit Party, and attested to by the Secretary or
any Assistant Secretary of such Credit Party, in the form of Exhibit F with
appropriate insertions, together with copies of the certificate or articles of
incorporation (or equivalent organizational document) and by-laws of such Credit
Party (but only to the extent that any such organizational documents have been
modified since the Effective Date) and the resolutions of such Credit Party
referred to in such certificate, and the foregoing shall be in form and
substance reasonably acceptable to the Agent.
(b) All corporate and legal proceedings and all instruments and
agreements in connection with the transactions contemplated by this Agreement
and the other Documents shall be reasonably satisfactory in form and substance
to the Agent and the Required Banks, and the Agent shall have received all
information and copies of all documents and papers, including records of
corporate proceedings, governmental approvals, good standing certificates and
bring-down telegrams or facsimiles, if any, which the Agent reasonably may have
requested in connection therewith, such documents and papers where appropriate
to be certified by proper corporate or governmental authorities.
5.05 Senior Subordinated Notes; etc. (a) On the Restatement
Effective Date, (i) the Borrower shall have received gross cash proceeds of
$100,000,000 from the issuance by it of a like principal amount of the Senior
Subordinated Notes and (ii) the Borrower shall have utilized 100% of the Net
Debt Proceeds from such issuance to repay outstanding Original Swingline Loans
and outstanding Original Revolving Loans, together with accrued and unpaid
interest thereon and any amounts that may be owing to the Banks pursuant to
Section 1.11 of the Original Credit Agreement in connection with such repayment.
(b) On or prior to the Restatement Effective Date, there shall have
been delivered to the Agent true and correct copies of the Senior Subordinated
Note Documents, and all of the terms and conditions of the Senior Subordinated
Note Documents shall be in substantial conformity with the description thereof
contained in the Senior Subordinated Note Offering Memorandum and as to matters
or specific terms not so described shall be reasonably satisfactory to the Agent
and the Required Banks. All conditions precedent to the issuance of the Senior
Subordinated Notes as set forth in the Senior Subordinated Note Documents shall
have been satisfied, and not waived, to the satisfaction of the Agent. The
issuance of the Senior Subordinated Notes shall have been consummated in all
material respects in accordance with the terms and conditions of the Senior
Subordinated Note Documents and all applicable laws.
5.06 Adverse Change, etc. (a) Nothing shall have occurred (and
neither the Agent nor the Banks shall have become aware of any facts or
conditions not previously known) which the Agent or the Required Banks shall
reasonably determine (a) has had, or could reasonably be expected to have, a
material adverse effect on the rights or remedies of the Banks or the Agent, or
on the ability of any Credit Party to perform its obligations to the Banks or
the Agent hereunder or under any other Credit Document or (b) has had, or could
reasonably be expected to have, a material adverse effect on the Refinancing or
on the business, operations, property, assets, liabilities, condition (financial
or otherwise) or prospects of the Borrower or any of its Subsidiaries.
(b) On or prior to the Restatement Effective Date, all necessary
governmental (domestic and foreign) and third party approvals and/or consents in
connection with the transactions contemplated by this Agreement and the other
Documents and otherwise referred to herein or therein shall have been obtained
and remain in effect. Additionally, there shall not exist any judgment, order,
injunction or other restraint issued or filed or a hearing seeking injunctive
relief or other restraint pending or notified prohibiting or imposing materially
adverse conditions upon the transactions contemplated by this Agreement and the
other Documents or otherwise referred to herein or therein.
5.07 Litigation. On the Restatement Effective Date, there shall be
no actions, suits or proceedings pending or threatened (i) with respect to this
Agreement or any other Document or (ii) which the Agent or the Required Banks
shall reasonably determine could reasonably be expected to have a material
adverse effect on (a) the business, operations, property, assets, liabilities,
condition (financial or otherwise) or prospects of the Borrower or any of its
Subsidiaries, (b) the rights or remedies of the Banks or the Agent hereunder or
under any other Credit Document or (c) the ability of any Credit Party to
perform its respective obligations to the Banks or the Agent hereunder or under
any other Credit Document.
5.08 Pledge Agreement. On the Restatement Effective Date, each
Credit Party shall have duly authorized, executed and delivered an amended and
restated Pledge Agreement in the form of Exhibit G (as amended, modified or
supplemented from time to time, the "Pledge Agreement") and shall have delivered
to the Collateral Agent, as Pledgee thereunder, all of the Pledged Securities,
if any, referred to therein and owned by such Credit Party, (x) endorsed in
blank in the case of Intercompany Notes constituting Pledged Securities and (y)
together with executed and undated stock powers in the case of capital stock
constituting Pledged Securities.
5.09 Security Agreement. On the Restatement Effective Date, each
Credit Party shall have duly authorized, executed and delivered the Security
Agreement in the form of Exhibit H (as modified, supplemented or amended from
time to time, the "Security Agreement") covering all of such Credit Party's
present and future Security Agreement Collateral, together with:
(i) proper Financing Statements (Form UCC-1 or the equivalent) fully
executed for filing under the UCC or other appropriate filing offices of
each jurisdiction as may be necessary or, in the reasonable opinion of the
Collateral Agent, desirable to perfect the security interests purported to
be created by the Security Agreement;
(ii) certified copies of Requests for Information or Copies (Form UCC-
11), or equivalent reports, listing all effective financing statements that
name any Credit Party as debtor and that are filed in the jurisdictions
referred to in clause (i) above, together with copies of such other
financing statements that name any Credit Party as debtor (none of which
shall cover the Collateral except to the extent evidencing Permitted Liens
or in respect of which the Collateral Agent shall have received termination
statements (Form UCC-3 or the equivalent) as shall be required by local law
fully executed for filing);
(iii) evidence of the completion of all other recordings and
filings of, or with respect to, the Security Agreement as may be necessary
to perfect the security interests intended to be created by the Security
Agreement; and
(iv) evidence that all other actions necessary to perfect and protect
the security interests purported to be created by the Security Agreement
have been taken.
5.10 Subsidiaries Guaranty. On the Restatement Effective Date, each
Subsidiary Guarantor shall have duly authorized, executed and delivered an
amended and restated Subsidiaries Guaranty in the form of Exhibit I (as amended,
modified or supplemented from time to time, the "Subsidiaries Guaranty").
5.11 Financial Statements; Pro Forma Balance Sheet; Projections. On
or prior to the Restatement Effective Date, the Agent shall have received true
and correct copies of the historical financial statements, the pro forma balance
sheet and the Projections referred to in Sections 7.05(a) and (d), which
historical financial statements, pro forma balance sheet and Projections shall
be in form and substance reasonably satisfactory to the Agent and the Required
Banks.
5.12 Solvency Certificate. On the Restatement Effective Date, the
Borrower shall have delivered to the Agent a solvency certificate from the Chief
Financial Officer of the Borrower in the form of Exhibit J.
5.13 Initial Borrowing Base Certificate. On the Restatement
Effective Date, the Agent shall have received the initial Borrowing Base
Certificate meeting the requirements of Section 8.01(i).
5.14 Fees, etc. On the Restatement Effective Date, the Borrower
shall have paid to the Agent and each Bank all costs, fees and expenses
(including, without limitation, reasonable legal fees and expenses) payable to
the Agent and such Bank to the extent then due, including, in the case of each
Bank, the commitment fee due to such Bank in accordance with the table set forth
in the letter dated February 13, 1998 from the Agent to the Banks.
SECTION 6. Conditions Precedent to All Credit Events. The obligation
of each Bank to make Loans (including Loans made on the Restatement Effective
Date), and the obligation of each Issuing Bank to issue Letters of Credit, is
subject, at the time of each such Credit Event (except as hereinafter
indicated), to the satisfaction of the following conditions:
6.01 Restatement Effective Date. The Restatement Effective Date
shall have occurred.
6.02 No Default; Representations and Warranties. At the time of each
such Credit Event and also after giving effect thereto (i) there shall exist no
Default or Event of Default and (ii) all representations and warranties
contained herein and in the other Credit Documents shall be true and correct in
all material respects with the same effect as though such representations and
warranties had been made on the date of such Credit Event (it being understood
and agreed that any representation or warranty which by its terms is made as of
a specified date shall be required to be true and correct in all material
respects only as of such specified date).
6.03 Notice of Borrowing; Letter of Credit Request. (a) Prior to
the making of each Revolving Loan (other than a Revolving Loan made pursuant to
a Mandatory Borrowing), the Agent shall have received a Notice of Borrowing
meeting the requirements of Section 1.03(a). Prior to the making of each
Swingline Loan, the Swingline Bank shall have received the notice referred to in
Section 1.03(b)(i).
(b) Prior to the issuance of each Letter of Credit, the Agent and the
respective Issuing Bank shall have received a Letter of Credit Request meeting
the requirements of Section 2.03.
The occurrence of the Restatement Effective Date and the acceptance of
the benefits of each Credit Event shall constitute a representation and warranty
by the Borrower to the Agent and each of the Banks that all the conditions
specified in Section 5 (with respect to the Restatement Effective Date and
Credit Events to occur on the Restatement Effective Date) and in this Section 6
(with respect to the Restatement Effective Date and Credit Events to occur on or
after the Restatement Effective Date) and applicable to such Credit Event exist
as of that time. All of the Notes, certificates, legal opinions and other
documents and papers referred to in Section 5 and in this Section 6, unless
otherwise specified, shall be delivered to the Agent at the Notice Office for
the account of each of the Banks and, except for the Notes, in sufficient
counterparts or copies for each of the Banks and shall be in form and substance
satisfactory to the Agent and the Required Banks.
SECTION 7. Representations, Warranties and Agreements. In order to
induce the Banks to enter into this Agreement and to make the Loans, and issue
(or participate in) the Letters of Credit as provided herein, the Borrower makes
the following representations, warranties and agreements, in each case after
giving effect to the Restatement Effective Date, all of which shall survive the
execution and delivery of this Agreement and the Notes and the making of the
Loans and issuance of the Letters of Credit, with the occurrence of the
Restatement Effective Date and the occurrence of each Credit Event on or after
the Restatement Effective Date being deemed to constitute a representation and
warranty that the matters specified in this Section 7 are true and correct on
and as of the Restatement Effective Date and on the date of each such Credit
Event (it being understood and agreed that any representation or warranty which
by its terms is made as of a specified date shall be required to be true and
correct only as of such specified date).
7.01 Corporate Status. Each of the Borrower and each of its
Subsidiaries (i) is a duly organized and validly existing corporation in good
standing under the laws of the jurisdiction of its organization, (ii) has the
corporate power and authority to own its property and assets and to transact the
business in which it is engaged and presently proposes to engage and (iii) is
duly qualified and is authorized to do business and is in good standing in each
jurisdiction where the ownership, leasing or operation of its property or the
conduct of its business requires such qualifications except for failures to be
so qualified which, individually or in the aggregate, could not reasonably be
expected to have a material adverse effect on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole.
7.02 Corporate and Other Power and Authority. Each Credit Party has
the corporate power and authority to execute, deliver and perform the terms and
provisions of each of the Documents to which it is party and has taken all
necessary corporate action to authorize the execution, delivery and performance
by it of each of such Documents. Each Credit Party has duly executed and
delivered each of the Documents to which it is party, and each of such Documents
constitutes its legal, valid and binding obligation enforceable in accordance
with its terms, except to the extent that the enforceability thereof may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws generally affecting creditors' rights and by equitable
principles (regardless of whether enforcement is sought in equity or at law).
7.03 No Violation. Neither the execution, delivery or performance by
any Credit Party of the Documents to which it is a party, nor compliance by it
with the terms and provisions thereof, (i) will contravene any provision of any
law, statute, rule or regulation or any order, writ, injunction or decree of any
court or governmental instrumentality, (ii) will conflict with or result in any
breach of any of the terms, covenants, conditions or provisions of, or
constitute a default under, or result in the creation or imposition of (or the
obligation to create or impose) any Lien (except pursuant to the Security
Documents) upon any of the property or assets of the Borrower or any of its
Subsidiaries pursuant to the terms of any indenture, mortgage, deed of trust,
credit agreement or loan agreement, or any other material agreement, contract or
instrument, to which the Borrower or any of its Subsidiaries is a party or by
which it or any of its property or assets is bound or to which it may be subject
or (iii) will violate any provision of the certificate or articles of
incorporation or by-laws (or equivalent organizational documents) of the
Borrower or any of its Subsidiaries.
7.04 Approvals. No order, consent, approval, license, authorization
or validation of, or filing, recording or registration with (except for those
that have otherwise been obtained or made on or prior to the Restatement
Effective Date and which remain in full force and effect on the Restatement
Effective Date), or exemption by, any governmental or public body or authority,
or any subdivision thereof, is required by any Credit Party to authorize, or is
required in connection with, (i) the execution, delivery and performance of any
Document by any Credit Party or (ii) the legality, validity, binding effect or
enforceability of any such Document against any Credit Party.
7.05 Financial Statements; Financial Condition; Undisclosed
Liabilities; Projections; etc. (a) The consolidated balance sheet of the
Borrower and its Subsidiaries for the fiscal year ended on December 31, 1997,
and the related consolidated statements of income, cash flows and shareholders'
equity of the Borrower and its Subsidiaries for the fiscal year ended on such
date, copies of which have been furnished to the Banks on or prior to the
Restatement Effective Date, present fairly in all material respects the
consolidated financial position of the Borrower and its Subsidiaries at the
dates of such balance sheet and the consolidated results of the operations of
the Borrower and its Subsidiaries for the periods covered thereby. All of the
foregoing financial statements have been prepared in accordance with generally
accepted accounting principles consistently applied. The pro forma consolidated
balance sheet of the Borrower and its Subsidiaries as of December 31, 1997 and
after giving effect to the Restatement Effective Date, a copy of which has been
furnished to the Banks on or prior to the Restatement Effective Date, presents
fairly in all material respects the pro forma consolidated financial position of
the Borrower and its Subsidiaries as of December 31, 1997. Since December 31,
1997, there has been no material adverse change in the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole.
(b) On and as of the Restatement Effective Date and after giving
effect thereto, (a) the sum of the assets, at a fair valuation, of each of the
Borrower on a stand-alone basis and of the Borrower and its Subsidiaries taken
as a whole will exceed its debts; (b) each of the Borrower on a stand-alone
basis and the Borrower and its Subsidiaries taken as a whole has not incurred
and does not intend to incur, and does not believe that it will incur, debts
beyond its ability to pay such debts as such debts mature; and (c) each of the
Borrower on a stand alone basis and the Borrower and its Subsidiaries taken as a
whole will have sufficient capital with which to conduct its business. For
purposes of this Section 7.05(b), "debt" means any liability on a claim, and
"claim" means (i) right to payment, whether or not such a right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured, or unsecured or (ii) right to
an equitable remedy for breach of performance if such breach gives rise to a pay
ment, whether or not such right to an equitable remedy is reduced to judgment,
fixed, contingent, matured, unmatured, disputed, undisputed, secured or
unsecured. The amount of contingent liabilities at any time shall be computed
as the amount that, in the light of all the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability.
(c) Except as fully disclosed in the financial statements delivered
pursuant to Section 7.05(a), there were as of the Restatement Effective Date no
liabilities or obligations with respect to the Borrower or any of its
Subsidiaries of any nature whatsoever (whether absolute, accrued, contingent or
otherwise and whether or not due) which, either individually or in aggregate,
could reasonably be expected to be material to the Borrower and its Subsidiaries
taken as a whole. As of the Restatement Effective Date, the Borrower does not
know of any basis for the assertion against it or any of its Subsidiaries of any
liability or obligation of any nature whatsoever that is not fully disclosed in
the financial statements delivered pursuant to Section 7.05(a) which, either
individually or in the aggregate, could reasonably be expected to be material to
the Borrower and its Subsidiaries taken as a whole.
(d) On and as of the Restatement Effective Date, the Projections
delivered to the Agent and the Banks prior to the Restatement Effective Date
have been prepared in good faith and are based on reasonable assumptions, and
there are no statements or conclusions in the Projections which are based upon
or include information known to the Borrower to be misleading in any material
respect or which fail to take into account material information known to the
Borrower regarding the matters reported therein. On the Restatement Effective
Date, the Borrower believes that the Projections are reasonable and attainable,
it being recognized by the Banks, however, that projections as to future events
are not to be viewed as facts and that the actual results during the period or
periods covered by the Projections may differ from the projected results and
that the differences may be material.
7.06 Litigation. There are no actions, suits or proceedings pending
or, to the best knowledge of the Borrower, threatened (i) with respect to this
Agreement or any other Credit Document, (ii) with respect to any material
Indebtedness of the Borrower or any of its Subsidiaries or (iii) that are
reasonably likely to materially and adversely affect the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole.
7.07 True and Complete Disclosure. All factual information (taken as
a whole) furnished by or on behalf of any Credit Party in writing to the Agent
or any Bank (including, without limitation, all information contained in the
Documents) for purposes of or in connection with this Agreement, the other
Credit Documents or any transaction contemplated herein or therein is, and all
other such factual information (taken as a whole) hereafter furnished by or on
behalf of any Credit Party in writing to the Agent or any Bank will be, true and
accurate in all material respects on the date as of which such information is
dated or certified and not incomplete by omitting to state any fact necessary to
make such information (taken as a whole) not misleading in any material respect
at such time in light of the circumstances under which such information was
provided.
7.08 Use of Proceeds; Margin Regulations. (a) All proceeds of the
Revolving Loans and the Swingline Loans shall be used for the working capital
and general corporate purposes of the Borrower and its Subsidiaries (including,
without limitation, for Permitted Acquisitions).
(b) No part of any Credit Event (or the proceeds thereof) will be
used to purchase or carry any Margin Stock or to extend credit for the purpose
of purchasing or carrying any Margin Stock except in connection with the
repurchase of shares of stock of the Borrower as permitted by Section 9.03. The
value of all Margin Stock at any time owned by the Borrower and its Subsidiaries
does not, and will not, exceed 25% of the value of the assets of the Borrower
and its Subsidiaries taken as a whole. Neither the making of any Loan nor the
use of the proceeds thereof nor the occurrence of any other Credit Event will
violate or be inconsistent with the provisions of Regulation G, T, U or X of the
Board of Governors of the Federal Reserve System.
7.09 Tax Returns and Payments. Each of the Borrower and each of its
Subsidiaries has filed all federal and state income tax returns and all other
material tax returns, domestic and foreign, required to be filed by it and has
paid all taxes and assessments payable by it which have become due, except for
those contested in good faith and adequately disclosed and fully provided for on
the financial statements of the Borrower and its Subsidiaries in accordance with
generally accepted accounting principles. The Borrower and each of its
Subsidiaries have paid, or have provided adequate reserves (in the good faith
judgment of the management of the Borrower) for the payment of, all federal,
state, local and foreign income taxes applicable for all prior fiscal years and
for the current fiscal year to date. There is no material action, suit,
proceeding, investigation, audit, or claim now pending or, to the knowledge of
the Borrower threatened, by any authority regarding any taxes relating to the
Borrower or any of its Subsidiaries. As of the Restatement Effective Date,
neither the Borrower nor any of its Subsidiaries has entered into an agreement
or waiver or been requested to enter into an agreement or waiver extending any
statute of limitations relating to the payment or collection of taxes of the
Borrower or any of its Subsidiaries, or is aware of any circumstances that would
cause the taxable years or other taxable periods of the Borrower or any of its
Subsidiaries not to be subject to the normally applicable statute of
limitations.
7.10 Compliance with ERISA. (i) Each Plan (and each related trust,
insurance contract or fund) is in substantial compliance with its terms and with
all applicable laws, including without limitation ERISA and the Code; each Plan
(and each related trust, if any) which is intended to be qualified under Section
401(a) of the Code has received a determination letter from the Internal Revenue
Service to the effect that it meets the requirements of Sections 401(a) and
501(a) of the Code; no Reportable Event has occurred and is continuing; no Plan
which is a multiemployer plan (as defined in Section 4001(a)(3) of ERISA) is
insolvent or in reorganization; no Plan has an Unfunded Current Liability; no
Plan which is subject to Section 412 of the Code or Section 302 of ERISA has an
accumulated funding deficiency, within the meaning of such sections of the Code
or ERISA, or has applied for or received a waiver of an accumulated funding
deficiency or an extension of any amortization period, within the meaning of
Section 412 of the Code or Section 303 or 304 of ERISA; all contributions
required to be made with respect to a Plan have been made and no material
liability has occurred as a result of any failure to make any such contribution
in a timely manner; neither the Borrower nor any Subsidiary of the Borrower nor
any ERISA Affiliate has incurred any material liability (including any indirect,
contingent or secondary liability) to or on account of a Plan pursuant to
Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of
ERISA or Section 401(a)(29), 4971 or 4975 of the Code or, to the knowledge of
any executive officer of the Borrower or the highest ranking Human Resources
Officer of the Borrower, expects to incur any such material liability under any
of the foregoing sections with respect to any Plan; no condition exists which
presents a material risk to the Borrower or any Subsidiary of the Borrower or
any ERISA Affiliate of incurring a material liability to or on account of a Plan
pursuant to the foregoing provisions of ERISA and the Code; no proceedings have
been instituted to terminate or appoint a trustee to administer any Plan which
is subject to Title IV of ERISA; no action, suit, proceeding, hearing, audit or
investigation with respect to the administration, operation or the investment of
assets of any Plan (other than routine claims for benefits) is pending or, to
the knowledge of any executive officer of the Borrower or the highest ranking
Human Resources officer of the Borrower, expected or threatened; using actuarial
assumptions and computation methods consistent with Part 1 of subtitle E of
Title IV of ERISA, the aggregate liabilities of the Borrower and its
Subsidiaries and its ERISA Affiliates to all Plans which are multiemployer plans
(as defined in Section 4001(a)(3) of ERISA) in the event of a complete
withdrawal therefrom, as of the close of the most recent fiscal year of each
such Plan ended prior to the date of the most recent Credit Event, would not
exceed $500,000; each group health plan (as defined in Section 607(1) of ERISA
or Section 4980B(g)(2) of the Code) which covers or has covered employees or
former employees of the Borrower, any Subsidiary of the Borrower, or any ERISA
Affiliate has at all times been operated in substantial compliance with the
provisions of Part 6 of subtitle B of Title I of ERISA and Section 4980B of the
Code and any failure to so comply would not result in a material liability; no
lien imposed under the Code or ERISA on the assets of the Borrower or any
Subsidiary of the Borrower or any ERISA Affiliate exists or, to the knowledge of
any executive officer of the Borrower or the highest ranking Human Resources
Officer of the Borrower, is likely to arise on account of any Plan; and the
Borrower and its Subsidiaries may cease contributions to or terminate any
employee benefit plan maintained by any of them without incurring any material
liability.
(ii) Each Foreign Pension Plan has been maintained in substantial
compliance with its terms and with the requirements of any and all applicable
laws, statutes, rules, regulations and orders and has been maintained, where
required, in good standing with applicable regulatory authorities. All
contributions required to be made with respect to a Foreign Pension Plan have
been made and no material liability has occurred as a result of any failure to
make any such contribution in a timely manner. Neither the Borrower nor any of
its Subsidiaries has incurred any obligation in connection with the termination
of or withdrawal from any Foreign Pension Plan. The present value of the
accrued benefit liabilities (whether or not vested) under each Foreign Pension
Plan, determined as of the end of the Borrower's most recently ended fiscal year
on the basis of actuarial assumptions, each of which is reasonable, did not
exceed the current value of the assets of such Foreign Pension Plan allocable to
such benefit liabilities.
7.11 The Security Documents. (a) The security interests created in
favor of the Collateral Agent, as Pledgee, for the benefit of the Secured
Creditors, under the Pledge Agreement constitute first priority perfected
security interests in the Pledged Securities described in the Pledge Agreement,
subject to no security interests of any other Person. No filings or recordings
are required in order to perfect (or maintain the perfection or priority of) the
security interests created in the Pledged Securities under the Pledge Agreement.
(b) The provisions of the Security Agreement are effective to create
in favor of the Collateral Agent for the benefit of the Secured Creditors a
legal, valid and enforceable security interest in all right, title and interest
of the Credit Parties party thereto in the Security Agreement Collateral
described therein, and the Collateral Agent, for the benefit of the Secured
Creditors has a fully perfected first lien on, and security interest in, all
right, title and interest in all of the Security Agreement Collateral described
therein, subject to no other Liens other than Permitted Liens of the type
described in Section 9.01(i).
7.12 Properties. The Borrower and each of its Subsidiaries have good
and marketable title to all material properties owned by them, including all
property reflected in the balance sheets referred to in Section 7.05(a) (except
as sold or otherwise disposed of since the date of such balance sheet in the
ordinary course of business or as permitted by the terms of this Agreement or
the Original Credit Agreement), free and clear of all Liens, other than
Permitted Liens.
7.13 Capitalization. On the Restatement Effective Date, the
authorized capital stock of the Borrower shall consist of 200,000,000 shares of
common stock, $.001 par value per share. All outstanding shares of capital
stock of the Borrower have been duly and validly issued and are fully paid and
non-assessable. The Borrower does not have outstanding any securities
convertible into or exchangeable for its capital stock or outstanding any rights
to subscribe for or to purchase, or any options for the purchase of, or any
agreement providing for the issuance (contingent or otherwise) of, or any calls,
commitments or claims of any character relating to, its capital stock, except
for options or warrants to purchase shares of the Borrower's common stock which
may be issued from time to time.
7.14 Subsidiaries. As of the Restatement Effective Date, the
Borrower has no Subsidiaries other than those Subsidiaries listed on Schedule
III. Schedule III correctly sets forth, as of the Restatement Effective Date,
the percentage ownership (direct or indirect) of the Borrower in each class of
capital stock or other equity of each of its Subsidiaries and also identifies
the direct owner thereof.
7.15 Compliance with Statutes, etc. Each of the Borrower and each of
its Subsidiaries is in compliance with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the ownership
of its property (including applicable statutes, regulations, orders and
restrictions relating to environmental standards and controls), except such
noncompliances as could not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole.
7.16 Investment Company Act. Neither the Borrower nor any of its
Subsidiaries is an "investment company" or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940,
as amended.
7.17 Public Utility Holding Company Act. Neither the Borrower nor
any of its Subsidiaries is a "holding company," or a "subsidiary company" of a
"holding company," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company" within the meaning of the Public Utility Holding
Company Act of 1935, as amended.
7.18 Environmental Matters. (a) The Borrower and each of its
Subsidiaries have complied with, and on the date of each Credit Event are in
compliance with, all applicable Environmental Laws and the requirements of any
permits issued under such Environmental Laws. There are no pending or, to the
best knowledge of the Borrower, threatened Environmental Claims against the
Borrower or any of its Subsidiaries (including any such claim arising out of the
ownership or operation by the Borrower or any of its Subsidiaries of any Real
Property no longer owned or operated by the Borrower or any of its Subsidiaries)
or any Real Property owned or operated by the Borrower or any of its
Subsidiaries. There are no facts, circumstances, conditions or occurrences with
respect to the business or operations of the Borrower or any of its
Subsidiaries, or any Real Property owned or operated by the Borrower or any of
its Subsidiaries (including any Real Property formerly owned or operated by the
Borrower or any of its Subsidiaries but no longer owned or operated by the
Borrower or any of its Subsidiaries) or any property adjoining or adjacent to
any such Real Property that could be expected (i) to form the basis of an
Environmental Claim against the Borrower or any of its Subsidiaries or any Real
Property owned or operated by the Borrower or any of its Subsidiaries or (ii) to
cause any Real Property owned or operated by the Borrower or any of its
Subsidiaries to be subject to any restrictions on the ownership, occupancy or
transferability of such Real Property by the Borrower or any of its Subsidiaries
under any applicable Environmental Law.
(b) Hazardous Materials have not at any time been generated, used,
treated or stored on, or transported to or from, any Real Property owned or
operated by the Borrower or any of its Subsidiaries where such generation, use,
treatment or storage has violated or could be expected to violate any
Environmental Law. Hazardous Materials have not at any time been Released on or
from any Real Property owned or operated by the Borrower or any of its
Subsidiaries where such Release has violated or could be expected to violate any
applicable Environmental Law.
(c) Notwithstanding anything to the contrary in this Section 7.18 the
representations made in this Section 7.18 shall not be untrue unless the
aggregate effect of all violations, claims, restrictions, failures and
noncompliances of the types described above could reasonably be expected to have
a material adverse effect on the business, operations, property, assets,
liabilities, condition (financial or otherwise) or prospects of the Borrower and
its Subsidiaries taken as a whole.
7.19 Labor Relations. Neither the Borrower nor any of its
Subsidiaries is engaged in any unfair labor practice that could reasonably be
expected to have a material adverse effect on the Borrower and its Subsidiaries
taken as a whole. There is (i) no unfair labor practice complaint pending
against the Borrower or any of its Subsidiaries or threatened against any of
them, before the National Labor Relations Board, and no grievance or arbitration
proceeding arising out of or under any collective bargaining agreement is so
pending against the Borrower or any of its Subsidiaries or, to the best
knowledge of the Borrower, threatened against any of them, (ii) no strike, labor
dispute, slowdown or stoppage pending against the Borrower or any of its
Subsidiaries or, to the best knowledge of the Borrower, threatened against the
Borrower or any of its Subsidiaries and (iii) no union representation question
exists with respect to the employees of the Borrower or any of its Subsidiaries,
except (with respect to any matter specified in clause (i), (ii) or (iii) above,
either individually or in the aggregate) such as could not reasonably be
expected to have a material adverse effect on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole.
7.20 Patents, Licenses, Franchises and Formulas. Each of the
Borrower and each of its Subsidiaries owns or has the right to use all the
patents, trademarks, permits, service marks, trade names, copyrights, licenses,
franchises, proprietary information (including but not limited to rights in
computer programs and databases) and formulas, or rights with respect to the
foregoing, and has obtained assignments of all leases and other rights of
whatever nature, necessary for the present conduct of its business, without any
known conflict with the rights of others which, or the failure to obtain which,
as the case may be, could reasonably be expected to result in a material adverse
effect on the business, operations, property, assets, liabilities, condition
(financial or otherwise) or prospects of the Borrower and its Subsidiaries taken
as a whole.
7.21 Indebtedness. Schedule IV sets forth a true and complete list
of all Indebtedness (including Contingent Obligations) of the Borrower and its
Subsidiaries as of the Restatement Effective Date (excluding the Loans, the
Letters of Credit and the Senior Subordinated Notes, the "Existing
Indebtedness"), in each case showing the aggregate principal amount thereof and
the name of the respective borrower and any Credit Party or any of its
Subsidiaries which directly or indirectly guarantees such debt.
7.22 Senior Subordinated Notes. (a) The subordination provisions
contained in the Senior Subordinated Notes and in the other Senior Subordinated
Note Documents are enforceable against the respective Credit Parties party
thereto and the holders of the Senior Subordinated Notes, and all Obligations
and Guaranteed Obligations (as defined in the Subsidiaries Guaranty) are within
the definition of "Senior Debt" or "Guarantor Senior Debt," as the case may be,
included in such subordination provisions.
(b) All representations and warranties set forth in the Senior
Subordinated Documents were true and correct in all material respects at the
time as of which such representations and warranties were made (or deemed made)
and shall be true and correct in all material respects as of the Restatement
Effective Date as if such representations and warranties were made on and as of
such date, unless stated to relate to a specific earlier date, in which case
such representations and warranties shall be true and correct in all material
respects as of such earlier date.
SECTION 8. Affirmative Covenants. The Borrower hereby covenants and
agrees that on and after the Restatement Effective Date and until the Total
Revolving Loan Commitment and all Letters of Credit have terminated and the
Loans, Notes and Unpaid Drawings, together with interest, Fees and all other
Obligations incurred hereunder and thereunder, are paid in full:
8.01 Information Covenants. The Borrower will furnish to each Bank:
(a) Quarterly Financial Statements. Within 45 days after the close
of the first three quarterly accounting periods in each fiscal year of the
Borrower, the consolidated and consolidating balance sheets of the Borrower and
its Subsidiaries as at the end of such quarterly accounting period and the
related consolidated and consolidating statements of income and retained
earnings and statement of cash flows for such quarterly accounting period and
for the elapsed portion of the fiscal year ended with the last day of such
quarterly accounting period, in each case setting forth comparative figures for
the related periods in the prior fiscal year, all of which shall be certified by
the Chief Financial Officer of the Borrower, subject to normal year-end audit
adjustments and the absence of footnotes.
(b) Annual Financial Statements. Within 90 days after the close of
each fiscal year of the Borrower, (i) the consolidated and consolidating balance
sheets of the Borrower and its Subsidiaries as at the end of such fiscal year
and the related consolidated and consolidating statements of income and retained
earnings and statement of cash flows for such fiscal year setting forth
comparative figures for the preceding fiscal year and (x) in the case of the
consolidated financial statements, certified by KPMG Peat Marwick LLP or such
other independent certified public accountants of recognized national standing
reasonably acceptable to the Agent, together with a report of such accounting
firm stating that in the course of its regular audit of the financial statements
of the Borrower and its Subsidiaries, which audit was conducted in accordance
with generally accepted auditing standards, such accounting firm obtained no
knowledge of any Default or an Event of Default which has occurred and is
continuing or, if in the opinion of such accounting firm such a Default or Event
of Default has occurred and is continuing, a statement as to the nature thereof
and (y) in the case of the consolidating financial statements, certified by the
Chief Financial Officer of the Borrower and (ii) management's discussion and
analysis of the important operational and financial developments during such
fiscal year.
(c) Management Letters. Promptly after the Borrower's or any of its
Subsidiaries' receipt thereof, a copy of any "management letter" received from
its certified public accountants and management's response thereto.
(d) Budgets. No later than 30 days following the first day of each
fiscal year of the Borrower, a budget in form reasonably satisfactory to the
Agent (including budgeted statements of income and sources and uses of cash and
balance sheets) prepared by the Borrower for each of the twelve months of such
fiscal year prepared in detail setting forth, with appropriate discussion, the
principal assumptions upon which such budgets are based.
(e) Officer's Certificates. At the time of the delivery of the
financial statements provided for in Sections 8.01(a) and (b), a certificate of
the Chief Financial Officer of the Borrower to the effect that, to the best of
such officer's knowledge, no Default or Event of Default has occurred and is
continuing or, if any Default or Event of Default has occurred and is
continuing, specifying the nature and extent thereof, which certificate shall
set forth in reasonable detail the calculations required to establish (A)
whether the Borrower and its Subsidiaries were in compliance with the provisions
of Sections 3.03(b), 3.03(d), 9.03, 9.04, 9.05 and 9.07 through 9.10, inclusive,
at the end of such fiscal quarter or year, as the case may be and (B) the
Applicable Eurodollar Rate Margin for the Margin Reduction Period commencing
with the date of the delivery of such financial statements.
(f) Notice of Default or Litigation. Promptly upon, and in any event
within three Business Days after, an officer of any Credit Party obtains
knowledge thereof, notice of (i) the occurrence of any event which constitutes a
Default or an Event of Default and/or (ii) any litigation or governmental
investigation or proceeding pending (x) against the Borrower or any of its
Subsidiaries which could reasonably be expected to materially and adversely
affect the business, operations, property, assets, liabilities, condition
(financial or otherwise) or prospects of the Borrower and its Subsidiaries taken
as a whole, (y) with respect to any material Indebtedness of the Borrower or any
of its Subsidiaries or (z) with respect to any Credit Document.
(g) Other Reports and Filings. Promptly after the filing or delivery
thereof, copies of all reports on Forms 10-K, 10-Q and 8-K and all proxy
materials, if any, which the Borrower or any of its Subsidiaries shall publicly
file with the Securities and Exchange Commission or any successor thereto (the
"SEC").
(h) Environmental Matters. Promptly after any officer of any Credit
Party obtains knowledge thereof, notice of one or more of the following
environmental matters, unless such environmental matters could not, individually
or when aggregated with all other such environmental matters, be reasonably
expected to materially and adversely affect the business, operations, property,
assets, liabilities, condition (financial or otherwise) or prospects of the
Borrower and its Subsidiaries taken as a whole:
(i) any pending or threatened Environmental Claim against the
Borrower or any of its Subsidiaries or any Real Property owned or operated
by the Borrower or any of its Subsidiaries;
(ii) any condition or occurrence on or arising from any Real Property
owned or operated by the Borrower or any of its Subsidiaries that (a)
results in noncompliance by the Borrower or any of its Subsidiaries with
any applicable Environmental Law or (b) could be expected to form the basis
of an Environmental Claim against the Borrower or any of its Subsidiaries
or any such Real Property;
(iii) any condition or occurrence on any Real Property owned or
operated by the Borrower or any of its Subsidiaries that could be expected
to cause such Real Property to be subject to any restrictions on the
ownership, occupancy, use or transferability by the Borrower or any of its
Subsidiaries of such Real Property under any Environmental Law; and
(iv) the taking of any removal or remedial action in response to the
actual or alleged presence of any Hazardous Material on any Real Property
owned or operated by the Borrower or any of its Subsidiaries as required by
any Environmental Law or any governmental or other administrative agency;
provided, that in any event the Borrower shall deliver to each Bank all
notices received by the Borrower or any of its Subsidiaries from any
government or governmental agency under, or pursuant to, CERCLA which
identify the Borrower or any of its Subsidiaries as potentially responsible
parties for remediation costs or which otherwise notify the Borrower or any
of its Subsidiaries of potential liability under CERCLA.
All such notices shall describe in reasonable detail the nature of the
claim, investigation, condition, occurrence or removal or remedial action and
the Borrower's or such Subsidiary's response thereto.
(i) Borrowing Base Certificate. (x) On the Restatement Effective
Date and (y) not later than 3:00 P.M. (New York time) on the fifteenth day of
each fiscal month of the Borrower thereafter, a borrowing base certificate in
the form of Exhibit K (each, a "Borrowing Base Certificate"), which shall be
prepared (A) as of January 31, 1998 in the case of the initial Borrowing Base
Certificate and (B) as of the last Business Day of the preceding fiscal month in
the case of each subsequent monthly Borrowing Base Certificate, in each case
certified by the Chief Financial Officer of the Borrower.
(j) Other Information. From time to time, such other information or
documents (financial or otherwise) with respect to the Borrower or any of its
Subsidiaries as the Agent or any Bank may reasonably request.
8.02 Books, Records and Inspections; Annual Meetings.
(a) The Borrower will, and will cause each of its Subsidiaries to,
keep proper books of record and accounts in which full, true and correct entries
in conformity with generally accepted accounting principles and all requirements
of law shall be made of all dealings and transactions in relation to its
business and activities. The Borrower will, and will cause each of its
Subsidiaries to, permit officers and designated representatives of the Agent or
any Bank to visit and inspect, under guidance of officers of the Borrower or
such Subsidiary, any of the properties of the Borrower or such Subsidiary, and
to examine the books of account of the Borrower or such Subsidiary and discuss
the affairs, finances and accounts of the Borrower or such Subsidiary with, and
be advised as to the same by, its and their officers and independent
accountants, all at such reasonable times and intervals and to such reasonable
extent as the Agent or such Bank may reasonably request. In addition, the
Borrower will, and will cause each of the Subsidiary Guarantors to, permit upon
reasonable prior notice to the Borrower the Agent to conduct, at Borrower's
expense, an audit of the accounts receivable of the Credit Parties at such times
(but no more frequently than once a year unless an Event of Default shall have
occurred and be continuing) as the Agent shall reasonably require.
(b) At a date to be mutually agreed upon between the Agent and the
Borrower occurring on or prior to the 120th day after the close of each fiscal
year of the Borrower, the Borrower shall, at the request of the Agent, hold a
meeting with all of the Banks at which meeting shall be reviewed the financial
results of the Borrower and its Subsidiaries for the previous fiscal year and
the budgets presented for the current fiscal year of the Borrower.
8.03 Maintenance of Property; Insurance. The Borrower will, and will
cause each of its Subsidiaries to, (i) keep all property necessary to the
business of the Borrower and its Subsidiaries in reasonably good working order
and condition, ordinary wear and tear excepted, (ii) maintain insurance in at
least such amounts and against at least such risks as is consistent and in
accordance with industry practice for companies similarly situated owning
similar properties in the same general areas in which the Borrower or any of its
Subsidiaries operates, and (iii) furnish to the Agent or any Bank, upon written
request, full information as to the insurance carried. If the Borrower or any
of its Subsidiaries shall fail to maintain insurance in accordance with this
Section 8.03, the Agent shall have the right (but shall be under no obligation)
to procure such insurance and the Borrower agrees to reimburse the Agent for all
costs and expenses of procuring such insurance.
8.04 Corporate Franchises. The Borrower will, and will cause each of
its Subsidiaries to, do or cause to be done, all things necessary to preserve
and keep in full force and effect its existence and its material rights,
franchises, licenses and patents; provided, however, that nothing in this
Section 8.04 shall prevent (i) sales of assets and other transactions by the
Borrower or any of its Subsidiaries in accordance with Section 9.02 or (ii) the
withdrawal by the Borrower or any of its Subsidiaries of its qualification as a
foreign corporation in any jurisdiction where such withdrawal could not
reasonably be expected to have a material adverse effect on the business,
operations, property, assets, liabilities, condition (financial or otherwise) or
prospects of the Borrower and its Subsidiaries taken as a whole.
8.05 Compliance with Statutes, etc. The Borrower will, and will
cause each of its Subsidiaries to, comply with all applicable statutes,
regulations and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property (including applicable statutes,
regulations, orders and restrictions relating to environmental standards and
controls), except such noncompliances (x) as could not, individually or in the
aggregate, reasonably be expected to have a material adverse effect on the
business, operations, property, assets, liabilities, condition (financial or
otherwise) or prospects of the Borrower and its Subsidiaries taken as a whole or
(y) as are being contested in good faith by the Borrower or such Subsidiary
through appropriate proceedings which are being diligently prosecuted.
8.06 Compliance with Environmental Laws. The Borrower will, and will
cause each of its Subsidiaries to, comply in all material respects with all
Environmental Laws applicable to the ownership or use of its Real Property now
or hereafter owned or operated by the Borrower or any of its Subsidiaries, will
promptly pay or cause to be paid all costs and expenses incurred in connection
with such compliance, and will keep or cause to be kept all such Real Property
free and clear of any Liens imposed pursuant to such Environmental Laws.
Neither the Borrower nor any of its Subsidiaries will generate, use, treat,
store, Release or dispose of, or permit the generation, use, treatment, storage,
Release or disposal of Hazardous Materials on any Real Property now or hereafter
owned or operated by the Borrower or any of its Subsidiaries, or transport or
permit the transportation of Hazardous Materials to or from any such Real
Property, except for Hazardous Materials generated, used, treated, stored,
Released or disposed of at any such Real Properties in compliance in all
material respects with all applicable Environmental Laws and reasonably required
in connection with the operation, use and maintenance of the business or
operations of the Borrower or any of its Subsidiaries.
8.07 ERISA. As soon as possible and, in any event, within ten (10)
days after the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate
knows of the occurrence of any of the following, the Borrower will deliver to
each of the Banks a certificate of the Chief Financial Officer of the Borrower
setting forth the full details as to such occurrence and the action, if any,
that the Borrower, such Subsidiary or such ERISA Affiliate is required or
proposes to take, together with any notices required or proposed to be given to
or filed with or by the Borrower, the Subsidiary, the ERISA Affiliate, the PBGC,
a Plan participant or the Plan administrator with respect thereto: that a
Reportable Event has occurred (except to the extent that the Borrower has
previously delivered to the Banks a certificate and notices (if any) concerning
such event pursuant to the next clause hereof); that a contributing sponsor (as
defined in Section 4001(a)(13) of ERISA) of a Plan subject to Title IV of ERISA
is subject to the advance reporting requirement of PBGC Regulation Section
4043.61 (without regard to subparagraph (b)(1) thereof), and an event described
in subsection .62, .63, .64, .65, .66, .67 or .68 of PBGC Regulation Section
4043 is reasonably expected to occur with respect to such Plan within the
following 30 days; that an accumulated funding deficiency, within the meaning of
Section 412 of the Code or Section 302 of ERISA, has been incurred or an
application may be or has been made for a waiver or modification of the minimum
funding standard (including any required installment payments) or an extension
of any amortization period under Section 412 of the Code or Section 303 or 304
of ERISA with respect to a Plan; that any contribution required to be made with
respect to a Plan or Foreign Pension Plan has not been timely made; that a Plan
has been or may be terminated, reorganized, partitioned or declared insolvent
under Title IV of ERISA; that a Plan has an Unfunded Current Liability; that
proceedings may be or have been instituted to terminate or appoint a trustee to
administer a Plan which is subject to Title IV of ERISA; that a proceeding has
been instituted pursuant to Section 515 of ERISA to collect a delinquent
contribution to a Plan; that the Borrower, any Subsidiary of the Borrower or any
ERISA Affiliate will or may incur any material liability (including any
indirect, contingent, or secondary liability) to or on account of the
termination of or withdrawal from a Plan under Section 4062, 4063, 4064, 4069,
4201, 4204 or 4212 of ERISA or with respect to a Plan under Section 401(a)(29),
4971, 4975 or 4980 of the Code or Section 409 or 502(i) or 502(l) of ERISA or
with respect to a group health plan (as defined in Section 607(1) of ERISA or
Section 4980B(g)(2) of the Code) under Section 4980B of the Code; or that the
Borrower or any Subsidiary of the Borrower may incur any material liability
pursuant to any employee welfare benefit plan (as defined in Section 3(1) of
ERISA) that provides benefits to retired employees or other former employees
(other than as required by Section 601 of ERISA) or any Plan or any Foreign
Pension Plan. Upon the request of the Agent, the Borrower will deliver to each
of the Banks a complete copy of the annual report (on Internal Revenue Service
Form 5500-series) of each Plan (including, to the extent required, the related
financial and actuarial statements and opinions and other supporting statements,
certifications, schedules and information) required to be filed with the
Internal Revenue Service. In addition to any certificates or notices delivered
to the Banks pursuant to the first sentence hereof, copies of any records,
documents or other information that must be furnished to the PBGC with respect
to any Plan pursuant to Section 4010 of ERISA, and any material notices received
by the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate with
respect to any Plan or Foreign Pension Plan shall be delivered to the Banks no
later than ten (10) days after the date such records, documents and/or
information has been furnished to the PBGC or such notice has been received by
the Borrower, the Subsidiary or the ERISA Affiliate, as applicable.
8.08 End of Fiscal Years; Fiscal Quarters. The Borrower will cause
(i) its fiscal year to end on December 31, and (ii) its fiscal quarters to end
on March 31, June 30, September 30 and December 31.
8.09 Performance of Obligations. The Borrower will, and will cause
each of its Subsidiaries to, perform all of its obligations under the terms of
each mortgage, indenture, security agreement, loan agreement or credit agreement
and each other material agreement, contract or instrument by which it is bound,
except such non-performances as could not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on the business,
operations, property, assets, liabilities, condition (financial or otherwise) or
prospects of the Borrower and its Subsidiaries taken as a whole.
8.10 Payment of Taxes. The Borrower will pay and discharge, and will
cause each of its Subsidiaries to pay and discharge, all taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits, or
upon any properties belonging to it, prior to the date on which penalties attach
thereto, and all lawful claims for sums that have become due and payable which,
if unpaid, might become a Lien not otherwise permitted under Section 9.01(i);
provided, that neither the Borrower nor any of its Subsidiaries shall be
required to pay any such tax, assessment, charge, levy or claim which is being
contested in good faith and by proper proceedings if it has maintained adequate
reserves with respect thereto in accordance with generally accepted accounting
principles.
8.11 Pledge of Foreign Subsidiaries Stock. If following a change in
the relevant sections of the Code or the regulations, rules, rulings, notices or
other official pronouncements issued or promulgated thereunder, counsel for the
Borrower reasonably acceptable to the Agent does not within 30 days after a
request from the Agent or the Required Banks deliver evidence, in form and
substance mutually satisfactory to the Agent and the Borrower, with respect to
any Foreign Subsidiary of the Borrower which has not already had all of its
stock pledged pursuant to the Pledge Agreement that a pledge of 66-2/3% or more
of the total combined voting power of all classes of capital stock of such
Foreign Subsidiary entitled to vote could reasonably be expected to cause (I)
the undistributed earnings of such Foreign Subsidiary as determined for federal
income tax purposes to be treated as a deemed dividend to such Foreign
Subsidiary's United States parent for federal income tax purposes or (II) other
material adverse federal income tax consequences to the Credit Parties, then in
the case of a failure to deliver the evidence described above, that portion of
such Foreign Subsidiary's outstanding capital stock owned by any Credit Party
and not theretofore pledged pursuant to the Pledge Agreement shall be pledged to
the Collateral Agent for the benefit of the Secured Creditors pursuant to the
Pledge Agreement.
8.12 Margin Stock. The Borrower will, and will cause each of the
Subsidiary Guarantors to, take any and all actions as may be required to ensure
that no capital stock pledged, or required to be pledged, pursuant to the Pledge
Agreement shall constitute Margin Stock.
SECTION 9. Negative Covenants. The Borrower hereby covenants and
agrees that on and after the Restatement Effective Date and until the Total
Revolving Loan Commitment and all Letters of Credit have terminated and the
Loans, Notes and Unpaid Drawings, together with interest, Fees and all other
Obligations incurred hereunder and thereunder, are paid in full:
9.01 Liens. The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets (real or personal, tangible or intangible) of
the Borrower or any of its Subsidiaries, whether now owned or hereafter
acquired, or sell any such property or assets subject to an understanding or
agreement, contingent or otherwise, to repurchase such property or assets
(including sales of accounts receivable with recourse to the Borrower or any of
its Subsidiaries), or assign any right to receive income or permit the filing of
any financing statement under the UCC or any other similar notice of Lien under
any similar recording or notice statute; provided that the provisions of this
Section 9.01 shall not prevent the creation, incurrence, assumption or existence
of the following (Liens described below are herein referred to as "Permitted
Liens"):
(i) inchoate Liens for taxes, assessments or governmental charges or
levies not yet due or not yet delinquent and payable without any penalty of
any kind or character or Liens for taxes, assessments or governmental
charges or levies being contested in good faith and by appropriate
proceedings for which adequate reserves have been established in accordance
with generally accepted accounting principles;
(ii) Liens in respect of property or assets of the Borrower or any of
its Subsidiaries imposed by law, which were incurred in the ordinary course
of business and do not secure Indebtedness for borrowed money, such as
carriers', warehousemen's, materialmen's and mechanics' liens and other
similar Liens arising in the ordinary course of business, and (x) which do
not in the aggregate materially detract from the value of the Borrower's or
such Subsidiary's property or assets or materially impair the use thereof
in the operation of the business of the Borrower or such Subsidiary or
(y) which are being contested in good faith by appropriate proceedings,
which proceedings have the effect of preventing the forfeiture or sale of
the property or assets subject to any such Lien;
(iii) Liens permitted by Section 9.01 (iii) of the Original Credit
Agreement and in existence on the Restatement Effective Date which are
listed, and the property subject thereto described, in Schedule V, but only
to the respective date, if any, set forth in such Schedule V for the
removal, replacement and termination of any such Liens, plus renewals,
replacements and extensions of such Liens to the extent set forth on
Schedule V, provided that (x) the aggregate principal amount of the
Indebtedness, if any, secured by such Liens does not increase from that
amount outstanding at the time of any such renewal, replacement or
extension and (y) any such renewal, replacement or extension does not
encumber any additional assets or properties of the Borrower or any of its
Subsidiaries;
(iv) Liens created pursuant to the Security Documents;
(v) leases or subleases granted to other Persons not materially
interfering with the conduct of the business of the Borrower or any of its
Subsidiaries;
(vi) Liens upon assets of the Borrower or any of its Subsidiaries
subject to Capitalized Lease Obligations to the extent such Capitalized
Lease Obligations are permitted by Section 9.04(iv), provided that (x) such
Liens only serve to secure the payment of Indebtedness arising under such
Capitalized Lease Obligation and (y) the Lien encumbering the asset giving
rise to the Capitalized Lease Obligation does not encumber any other asset
of the Borrower or any Subsidiary of the Borrower;
(vii) Liens placed upon equipment or machinery used in the
ordinary course of business of the Borrower or any of its Subsidiaries at
the time of the acquisition thereof by the Borrower or any such Subsidiary
or within 90 days thereafter to secure Indebtedness incurred to pay all or
a portion of the purchase price thereof or to secure Indebtedness incurred
solely for the purpose of financing the acquisition of any such equipment
or machinery or extensions, renewals or replacements of any of the
foregoing for the same or a lesser amount, provided that (x) such
Indebtedness is permitted by Section 9.04(iv) and (y) in all events, the
Lien encumbering the equipment or machinery so acquired does not encumber
any other asset of the Borrower or such Subsidiary;
(viii) easements, rights-of-way, restrictions, encroachments and
other similar charges or encumbrances, and minor title deficiencies, in
each case not securing Indebtedness and not materially interfering with the
conduct of the business of the Borrower or any of its Subsidiaries;
(ix) Liens arising from precautionary UCC financing statement filings
regarding operating leases;
(x) Liens arising out of the existence of judgments or awards in
respect of which the Borrower or any of its Subsidiaries shall in good
faith be prosecuting an appeal or proceedings for review in respect of
which there shall have been secured a subsisting stay of execution pending
such appeal or proceedings, provided that the aggregate amount of any cash
and the fair market value of any property subject to such Liens do not
exceed $3,000,000 at any time outstanding;
(xi) statutory and common law landlords' liens under leases to which
the Borrower or any of its Subsidiaries is a party;
(xii) Liens placed upon any of the assets of a Foreign Subsidiary
of the Borrower to secure any Foreign Subsidiary Third Party Borrowings
directly incurred by such Foreign Subsidiary pursuant to Section 9.04(v),
provided that in all events the Lien encumbering such assets does not
encumber any asset of the Borrower or any other Subsidiary of the Borrower;
(xiii) Liens (other than Liens imposed under ERISA) incurred in the
ordinary course of business in connection with workers compensation claims,
unemployment insurance and social security benefits;
(xiv) Liens securing (x) the performance of bids, tenders, leases
and contracts in the ordinary course of business and (y) statutory
obligations, surety bonds, performance bonds and other obligations of a
like nature incurred in the ordinary course of business (exclusive of
obligations in respect of the payment for borrowed money), provided that
the aggregate outstanding amount of obligations secured by Liens permitted
by this clause
(xiv) (and the value of all cash and property encumbered by Liens
permitted pursuant to this clause (xiv)) shall not at any time exceed
$500,000; and
(xv) Liens on property or assets acquired pursuant to a Permitted
Acquisition or pursuant to an Investment made under Section 9.05(xv), or on
property or assets of a Subsidiary of the Borrower in existence at the time
such Subsidiary is acquired pursuant to a Permitted Acquisition or pursuant
to an Investment made under Section 9.05(xv), provided that (x) any
Indebtedness that is secured by such Liens is permitted to exist under
Section 9.04(x), and (y) such Liens are not incurred in connection with, or
in contemplation or anticipation of, such Permitted Acquisition or such
permitted Investment, as the case may be, and do not attach to any other
asset of the Borrower or any of its Subsidiaries.
9.02 Consolidation, Merger, Purchase or Sale of Assets, etc. The
Borrower will not, and will not permit any of its Subsidiaries to, wind up,
liquidate or dissolve its affairs or enter into any transaction of merger or
consolidation, or convey, sell, lease or otherwise dispose of all or any part of
its property or assets, or enter into any sale-leaseback transactions, or
purchase or otherwise acquire (in one or a series of related transactions) any
part of the property or assets (other than purchases or other acquisitions of
inventory, materials and equipment in the ordinary course of business) of any
Person (or agree to do any of the foregoing at any future time), except that:
(i) Capital Expenditures by the Borrower and its Subsidiaries shall
be permitted to the extent not in violation of Section 9.07;
(ii) each of the Borrower and its Subsidiaries may make sales of
inventory in the ordinary course of business;
(iii) each of the Borrower and its Subsidiaries may sell obsolete
or worn-out equipment or materials in the ordinary course of business;
(iv) each of the Borrower and its Subsidiaries may sell or discount,
in each case without recourse and in the ordinary course of business,
accounts receivable arising in the ordinary course of business, but only in
connection with the compromise or collection thereof;
(v) each of the Borrower and its Subsidiaries may sell other assets
in the ordinary course of business in an aggregate amount not to exceed
$250,000 per sale or series of related sales, provided that no more than
$1,000,000 of such sales may be made pursuant to this clause (v) in any
fiscal year of the Borrower;
(vi) each of the Borrower and its Subsidiaries may sell other assets
so long as (i) no Default or no Event of Default then exists or would
result therefrom, (ii) each such sale is in an arm's-length transaction and
the Borrower or the respective Subsidiary receives at least fair market
value (as determined in good faith by the Borrower or such Subsidiary, as
the case may be), (iii) the total consideration received by the Borrower or
such Subsidiary is at least 90% cash and is paid at the time of the closing
of such sale, (iv) the Net Sale Proceeds therefrom are applied and/or
reinvested as (and to the extent) required by Section 3.03(b) and (v) the
aggregate amount of the proceeds received from all assets sold pursuant to
this clause (vi) shall not exceed $5,000,000 in any fiscal year of the
Borrower;
(vii) Investments may be made to the extent permitted by Section
9.05;
(viii) each of the Borrower and its Subsidiaries may lease (as
lessee) real or personal property (so long as any such lease does not
create a Capitalized Lease Obligation except to the extent permitted by
Section 9.04(iv));
(ix) the Borrower and its Wholly-Owned Subsidiaries may acquire all or
substantially all of the assets of any Person (or all or substantially all
of the assets of a product line or division of any Person) or 100% of the
capital stock of any Person (including by purchasing the remaining portion
of the capital stock of any Person in which the Borrower or a Wholly-Owned
Subsidiary thereof already has an ownership interest and as a result of
which such Person shall become a Wholly-Owned Subsidiary of the Borrower)
(any such acquisition permitted by this clause (ix), a "Permitted
Acquisition"), so long as (i) no Default or Event of Default then exists or
would result therefrom, (ii) each of the representations and warranties
contained in Section 7 shall be true and correct in all material respects
both before and after giving effect to such Permitted Acquisition, (iii)
any Liens or Indebtedness assumed or issued in connection with such
acquisition are otherwise permitted under Section 9.01 or 9.04, as the case
may be, (iv) the only consideration paid by the Borrower or any of its
Subsidiaries in connection with any Permitted Acquisition consists solely
of cash and/or common stock or Qualified Preferred Stock of the Borrower,
(v) at least 10 Business Days prior to the consummation of any Permitted
Acquisition, the Borrower shall deliver to the Agent and each of the Banks
a certificate of the Borrower's Chief Financial Officer certifying (and
showing the calculations therefor in reasonable detail) that the Borrower
would have been in compliance with the financial covenants set forth in
Sections 9.08, 9.09 and 9.10 for the Test Period then most recently ended
prior to the date of the consummation of such Permitted Acquisition, in
each case with such financial covenants to be determined on a pro forma
basis as if such Permitted Acquisition had been consummated on the first
day of such Test Period (and assuming that any Indebtedness incurred,
issued or assumed in connection therewith had been incurred, issued or
assumed on the first day of, and had remained outstanding throughout, such
Test Period), (vi) the aggregate cash consideration paid in connection with
any Permitted Acquisition (including, without limitation, any earn-out,
non-compete or deferred compensation arrangements and the aggregate
principal amount of any Indebtedness assumed in connection therewith) does
not exceed $25,000,000, provided that such amount shall be increased to
$35,000,000 to the extent that the Borrower's pro forma Leverage Ratio
after giving effect to such Permitted Acquisition is 2.50:1.00 or less and
(vii) to the extent that the Borrower's pro forma Leverage Ratio after
giving effect to such Permitted Acquisition is greater than 2.50:1.00, the
sum of (I) the aggregate cash consideration paid in connection with any
Permitted Acquisition (including, without limitation, any earn-out, non-
compete or deferred compensation arrangements and the aggregate principal
amount of any Indebtedness assumed in connection therewith) and (II) the
fair market value of any common stock and/or Qualified Preferred Stock of
the Borrower issued in connection therewith does not exceed $100,000,000;
(x) each of the Borrower and its Subsidiaries may grant leases or
subleases to other Persons not materially interfering with the conduct of
the business of the Borrower or any of its Subsidiaries;
(xi) the Borrower and its Subsidiaries may consummate sale and
leaseback transactions with respect to those properties identified on
Schedule VI and with respect to properties acquired after the Restatement
Effective Date, in each case so long as (i) no Default or Event of Default
then exists or would result therefrom, (ii) each such sale and leaseback
transaction is in an arm's-length transaction and the Borrower or the
respective Subsidiary receives at least fair market value (as determined in
good faith by the Borrower or such Subsidiary, as the case may be), (iii)
the total consideration received by the Borrower or such Subsidiary in
connection with each such sale and leaseback transaction is cash and is
paid at the time of the closing thereof, and (iv) the Net Sale Proceeds
therefrom are applied and/or reinvested as (and to the extent) required by
Section 3.03(b);
(xii) any Subsidiary of the Borrower may be merged or consolidated
with or into the Borrower so long as the Borrower is the surviving
corporation of such merger or consolidation;
(xiii) any Subsidiary of the Borrower may be merged or consolidated
with or into any other Subsidiary of the Borrower so long as (i) in the
case of any such merger or consolidation involving a Subsidiary Guarantor,
the Subsidiary Guarantor is the surviving corporation of such merger or
consolidation and (ii) in the case of any such merger or consolidation
involving a Wholly-Owned Subsidiary of the Borrower, the Wholly-Owned
Subsidiary is the surviving corporation of such merger or consolidation;
and
(xiv) the Borrower and its Subsidiaries may sell up to a 49%
equity interest in the Borrower's Subsidiary formed to conduct business in
Latin America (other than in Mexico and Columbia) to a joint venture
partner that is not an Affiliate of the Borrower so long as (i) no Default
or Event of Default then exists or would result therefrom, (ii) such sale
is in an arm's-length transaction and the Borrower or the respective
Subsidiary receives at least fair market value (as determined in good faith
by the Borrower or such Subsidiary, as the case may be), (iii) the total
consideration received by the Borrower or such Subsidiary in connection
therewith is cash and is paid at the time of the closing of such sale, and
(iv) the Net Sale Proceeds therefrom are applied and/or reinvested as (and
to the extent) required by Section 3.03(b).
To the extent the Required Banks waive the provisions of this Section
9.02 with respect to the sale of any Collateral, or any Collateral is sold as
permitted by this Section 9.02 (other than to the Borrower or a Subsidiary
thereof), such Collateral shall be sold free and clear of the Liens created by
the respective Security Documents and the Agent and the Collateral Agent shall
be authorized to take any actions deemed appropriate in order to effect the
foregoing.
9.03 Restricted Payments. The Borrower will not, and will not permit
any of its Subsidiaries to, authorize, declare, pay or make any Restricted
Payment, except that:
(i) any Subsidiary of the Borrower may pay cash Dividends to the
Borrower or to any Wholly-Owned Subsidiary of the Borrower;
(ii) any non-Wholly-Owned Subsidiary of the Borrower may pay cash
Dividends to its shareholders generally so long as the Borrower or its
respective Subsidiary which owns the equity interest in the Subsidiary
paying such Dividends receives at least its proportionate share thereof
(based upon its relative holding of the equity interest in the Subsidiary
paying such Dividends and taking into account the relative preferences, if
any, of the various classes of equity interests of such Subsidiary); and
(iii) so long as there shall exist no Default or Event of Default
(both before and after giving effect to the payment thereof), the Borrower
may make cash Restricted Payments so long as the aggregate amount of all
Restricted Payments made subsequent to the Restatement Effective Date
pursuant to this clause (iii) does not exceed the remainder of (A) the sum
of (I) $15,000,000, plus (II) 50% of the cumulative Consolidated Net Income
(or, if cumulative Consolidated Net Income shall be a loss, minus 100% of
such loss) of the Borrower earned subsequent to the Restatement Effective
Date and on or prior to the date the Restricted Payment occurs (the
"Restricted Payment Reference Date") (treating such period as a single
accounting period), provided, that in the case of common Stock Dividends,
the applicable percentage of cumulative Consolidated Net Income instead
shall be 25%, plus (III) 100% of the aggregate Net Equity Proceeds received
by the Borrower from any Person (other than a Subsidiary of the Borrower)
from the issuance and sale subsequent to the Restatement Effective Date and
on or prior to the Restricted Payment Reference Date of common stock and/or
Qualified Preferred Stock of the Borrower, plus (IV) without duplication of
any amounts included in preceding clause (III), 100% of the aggregate Net
Equity Proceeds of any equity contribution received by the Borrower from a
holder of the Borrower's common stock (other than from a Subsidiary of the
Borrower) minus (B) any amounts referred to in preceding clauses (II),
(III) and (IV) to the extent that such amounts are used to make Investments
pursuant to Section 9.05(xv).
Notwithstanding anything to the contrary contained in clause (iii) above in this
Section 9.03, the Borrower will not, and will not permit any of its Subsidiaries
to, make any Restricted Payment in respect of the Senior Subordinated Notes (i)
to the extent that the payment thereof would violate the subordination
provisions contained therein or (ii) as a result of any asset sale, change of
control or similar event.
9.04 Indebtedness. The Borrower will not, and will not permit any of
its Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness, except:
(i) Indebtedness incurred pursuant to this Agreement and the other
Credit Documents;
(ii) Existing Indebtedness permitted by Section 9.04(ii) of the
Original Credit Agreement and outstanding on the Restatement Effective
Date, and giving effect to any subsequent extension, renewal or refinancing
thereof, provided that the aggregate principal amount of the Indebtedness
to be extended, renewed or refinanced does not increase from that amount
outstanding at the time of any such extension, renewal or refinancing;
(iii) Indebtedness under Interest Rate Protection Agreements
entered into with respect to other Indebtedness permitted under this
Section 9.04;
(iv) Indebtedness of the Borrower and its Subsidiaries evidenced by
Capitalized Lease Obligations and purchase money Indebtedness subject to
Liens permitted under Section 9.01(vii), provided that in no event shall
the sum of (I) the aggregate principal amount of all Capitalized Lease
Obligations and (II) the aggregate principal amount of all purchase money
Indebtedness (including, in each case, any Capitalized Lease Obligations
and purchase money Indebtedness constituting Existing Indebtedness) exceed
$40,000,000 at any time outstanding;
(v) Indebtedness of any Foreign Subsidiary of the Borrower under
lines of credit extended by third Persons to any such Foreign Subsidiary
the proceeds of which Indebtedness are used for such Foreign Subsidiary's
working capital and general corporate purposes, provided that the aggregate
principal amount of all such Indebtedness incurred pursuant to this clause
(v), together with the aggregate principal amount of any Existing
Indebtedness under such lines of credit, shall not exceed $50,000,000 (or
the Dollar Equivalent thereof in the case of Indebtedness incurred in a
currency other than Dollars) at any time outstanding (the "Foreign
Subsidiary Third Party Borrowings");
(vi) intercompany Indebtedness among the Borrower and its Subsidiaries
to the extent permitted by Sections 9.05(ix), (xiii), (xiv) and (xv);
(vii) Indebtedness consisting of guaranties by the Borrower and
its Subsidiaries of other Indebtedness of the Borrower and its Subsidiaries
otherwise permitted to be incurred under this Section 9.04;
(viii) Indebtedness under Other Hedging Agreements providing
protection against fluctuations in currency values in connection with the
Borrower's or any of its Subsidiaries' operations so long as management of
the Borrower or such Subsidiary, as the case may be, has determined that
the entering into of such Other Hedging Agreements are bona fide hedging
activities and are not for speculative purposes;
(ix) Indebtedness of the Borrower and the Subsidiary Guarantors under
the Senior Subordinated Notes and the other Senior Subordinated Note
Documents in an aggregate principal amount not to exceed $100,000,000 (as
reduced by any repayments of principal thereof);
(x) Indebtedness of a Subsidiary acquired pursuant to a Permitted
Acquisition or pursuant to an Investment made under Section 9.05(xv) (or
Indebtedness assumed at the time of a Permitted Acquisition or an
Investment made under Section 9.05(xv) of an asset securing such
Indebtedness), provided that (x) such Indebtedness was not incurred in
connection with, or in anticipation or contemplation of, such Permitted
Acquisition or such Investment, as the case may be, (y) such Indebtedness
does not constitute debt for borrowed money (other than debt for borrowed
money incurred in connection with industrial revenue or industrial
development bond financings), it being understood and agreed that
Capitalized Lease Obligations and purchase money Indebtedness shall not
constitute debt for borrowed money for purposes of this clause (y), and (z)
at the time of such Permitted Acquisition or such Investment, as the case
may be, such Indebtedness does not exceed 30% of the total value of the
assets of the Subsidiary so acquired, or of the asset so acquired, as the
case may be; and
(xi) additional unsecured Indebtedness incurred by the Borrower and
its Subsidiaries in an aggregate principal amount not to exceed $7,000,000
at any one time outstanding.
9.05 Advances, Investments and Loans. The Borrower will not, and
will not permit any of its Subsidiaries to, directly or indirectly, lend money
or credit or make advances to any Person, or purchase or acquire any stock,
obligations or securities of, or any other interest in, or make any capital
contribution to, any other Person, or purchase or own a futures contract or
otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract, or hold any
cash or Cash Equivalents (each of the foregoing an "Investment" and,
collectively, "Investments"), except that the following shall be permitted:
(i) the Borrower and its Subsidiaries may acquire and hold accounts
receivables owing to any of them, if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with
customary trade terms of the Borrower or such Subsidiary;
(ii) the Borrower and its Subsidiaries may acquire and hold cash and
Cash Equivalents, provided that during any time that Revolving Loans or
Swingline Loans are outstanding the aggregate amount of cash and Cash
Equivalents permitted to be held by the Borrower and its Domestic
Subsidiaries shall not exceed $5,000,000 for any period of five consecutive
Business Days;
(iii) the Borrower and its Subsidiaries may hold the Investments
held by them on the Restatement Effective Date and described on Schedule
VII, provided that any additional Investments made with respect thereto
shall be permitted only if independently justified under the other
provisions of this Section 9.05;
(iv) the Borrower and its Subsidiaries may acquire and own investments
(including debt obligations) received in connection with the bankruptcy or
reorganization of suppliers and customers and in good faith settlement of
delinquent obligations of, and other disputes with, customers and suppliers
arising in the ordinary course of business;
(v) the Borrower and its Subsidiaries may make loans and advances in
the ordinary course of business to their respective employees so long as
the aggregate principal amount thereof at any time outstanding (determined
without regard to any write-downs or write-offs of such loans and advances)
shall not exceed $2,000,000;
(vi) the Borrower may acquire and hold obligations of one or more
officers or other employees of the Borrower or any of its Subsidiaries in
connection with such officers' or employees' acquisition of shares of
common stock of the Borrower so long as no cash is paid by the Borrower or
any of its Subsidiaries to such officers or employees in connection with
the acquisition of any such obligations;
(vii) the Borrower may enter into Interest Rate Protection
Agreements to the extent permitted by Section 9.04(iii);
(viii) the Borrower and its Subsidiaries may enter into Other
Hedging Agreements to the extent permitted by Section 9.04(viii);
(ix) the Borrower and the Subsidiary Guarantors may make intercompany
loans and advances between or among one another (collectively,
"Intercompany Loans"), so long as each Intercompany Loan shall be evidenced
by an Intercompany Note that is pledged to the Collateral Agent pursuant to
the Pledge Agreement;
(x) the Borrower may make cash common equity contributions to the
capital of the Subsidiary Guarantors and the Subsidiary Guarantors may make
cash common equity contributions to the capital of their respective
Subsidiaries which are Subsidiary Guarantors;
(xi) Permitted Acquisitions shall be permitted pursuant to Section
9.02(ix);
(xii) the Borrower and its Subsidiaries may acquire and hold
promissory notes issued by the purchaser of assets in connection with a
sale of such assets to the extent permitted by Section 9.02(vi);
(xiii) the Borrower and the Subsidiary Guarantors may make
additional Intercompany Loans and/or cash equity contributions to Wholly-
Owned Foreign Subsidiaries of the Borrower for the purpose of enabling such
Wholly-Owned Foreign Subsidiaries to consummate a Permitted Acquisition so
long as each such Investment that is made as an Intercompany Loan shall be
evidenced by an Intercompany Note that is pledged to the Collateral Agent
pursuant to the Pledge Agreement;
(xiv) the Borrower and its Subsidiaries may make additional
Intercompany Loans and/or cash equity contributions to their respective
Subsidiaries for the purpose of enabling such Subsidiaries to make an
Investment permitted by clause (xv) of this Section 9.05 so long as each
such Investment that is made as an Intercompany Loan shall be evidenced by
an Intercompany Note that is pledged to the Collateral Agent pursuant to
the Pledge Agreement;
(xv) so long as no Default or Event of Default then exists or would
result therefrom, the Borrower and its Subsidiaries may make additional
Investments so long as the aggregate amount of all such Investments made
subsequent to the Restatement Effective Date and outstanding at any time
(determined without regard to any write-downs or write-offs thereof)
pursuant to this clause (xv) does not exceed the remainder of (A) the sum
of (I) $30,000,000, plus (II) 50% of the cumulative Consolidated Net
Income (or, if cumulative Consolidated Net Income shall be a loss, minus
100% of such loss) of the Borrower earned subsequent to the Restatement
Effective Date and on or prior to the date the Investment occurs (the
"Investment Reference Date") (treating such period as a single accounting
period), plus (III) 100% of the aggregate Net Equity Proceeds received by
the Borrower from any Person (other than a Subsidiary of the Borrower) from
the issuance and sale subsequent to the Restatement Effective Date and on
or prior to the Investment Reference Date of common stock and/or Qualified
Preferred Stock of the Borrower, plus (IV) without duplication of any
amounts included in preceding clause (III), 100% of the aggregate Net
Equity Proceeds of any equity contribution received by the Borrower from a
holder of the Borrower's stock (other than from a Subsidiary of the
Borrower) minus (B) any amounts referred to in preceding clauses (II),
(III) and (IV) to the extent that such amounts are used to make Restricted
Payments pursuant to Section 9.03(iii), provided that in the case of any
such Investment made in any Person that is not then a Subsidiary of the
Borrower, at least 10 Business Days prior to the making of any such
Investment, the Borrower shall deliver to the Agent and each of the Banks a
certificate of the Chief Financial Officer of the Borrower certifying (and
showing the calculations therefor in reasonable detail) that the Borrower
would have been in compliance with the financial covenants set forth in
Sections 9.08, 9.09 and 9.10 for the Test Period then most recently ended
prior the date of such Investment, in each case with such financial
covenants to be determined on a pro forma basis as if such Investment had
been made on the first day of such Test Period (and assuming that any
Indebtedness incurred, issued or assumed in connection therewith had been
incurred, issued or assumed on the first day of, and had remained
outstanding throughout, such Test Period); and
(xvi) SITEL International, Inc. and/or a Subsidiary thereof may
contribute their equity interests in Grupo SITEL de Mexico, S.A. de C.V.
and/or any other Foreign Subsidiary of the Borrower to another Wholly-Owned
Subsidiary of the Borrower.
9.06 Transactions with Affiliates. (a) The Borrower will not, and
will not permit any of its Subsidiaries to, directly or indirectly, enter into
or permit to exist any transaction or series of related transactions
(including, without limitation, the purchase, sale, lease or exchange of any
property or the rendering of any service), with, or for the benefit of, any
Affiliate of the Borrower or any of its Subsidiaries (each an "Affiliate
Transaction"), other than (x) Affiliate Transactions permitted under clause (b)
of this Section 9.06 and (y) Affiliate Transactions on terms that are no less
favorable than those that might reasonably have been obtained in a comparable
transaction at such time on an arm's length basis from a Person that is not an
Affiliate of the Borrower or such Subsidiary. All Affiliate Transactions (and
each series of related Affiliate Transactions which are similar or part of a
common plan) involving aggregate payments or other property with a fair market
value (as determined in good faith by the Board of Directors of the Borrower or
such Subsidiary, as the case may be) in excess of $1,000,000 shall be approved
by the Board of Directors of the Borrower or such Subsidiary, as the case may
be, and with such approval to be evidenced by a Board resolution stating that
such Board of Directors has determined that such transaction complies with the
foregoing provisions. If the Borrower or any Subsidiary of the Borrower enters
into an Affiliate Transaction (or a series of related Affiliate Transactions
related to a common plan) that involves an aggregate fair market value (as
determined in good faith by the Board of Directors of the Borrower or such
Subsidiary, as the case may be) of more than $5,000,000, the Borrower or such
Subsidiary, as the case may be, shall, prior to the consummation thereof,
obtain a favorable opinion as to the fairness of such transaction or series of
related transactions to the Borrower or the relevant Subsidiary, as the case
may be, from a financial point of view, from an Independent Financial Advisor
and file the same with the Agent.
(b) The restrictions set forth in clause (a) of this Section 9.06
shall not apply to (i) reasonable fees and compensation paid to and indemnity
provided on behalf of, officers, directors, employees or consultants of the
Borrower or any Subsidiary of the Borrower as determined in good faith by the
Borrower's Board of Directors or senior management, (ii) transactions
exclusively between or among the Borrower and any of its Subsidiaries or
exclusively between or among such Subsidiaries, provided such transactions are
not otherwise prohibited by the Credit Documents, (iii) transactions
exclusively between or among the Borrower and any of its Subsidiaries on the
one hand and any joint venture in which the Borrower and its Subsidiaries own
at least 45% of the total equity interest on the other hand, so long as no
portion of the remaining interest in such joint venture is owned by a Person
who is an Affiliate of the Borrower (other than another Subsidiary of the
Borrower) and such transactions are not otherwise prohibited by the Credit
Documents, (iv) any agreement as in effect as of the Restatement Effective
Date or any amendment thereto or any transaction contemplated thereby
(including pursuant to any amendment thereto) in any replacement agreement
thereto so long as any such amendment or replacement agreement is not more
disadvantageous to the Banks in any material respect than the original
agreement as in effect on the Restatement Effective Date; (v) advances or
loans to employees, officers and directors of the Borrower and its
Subsidiaries permitted by Sections 9.05(v) and (xv), and (vi) Restricted
Payments permitted by Section 9.03.
9.07 Capital Expenditures. (a) The Borrower will not, and will not
permit any of its Subsidiaries to, make any Capital Expenditures, except that
during any fiscal year of the Borrower set forth below (taken as one accounting
period), the Borrower and its Subsidiaries may make Capital Expenditures so
long as the aggregate amount of all such Capital Expenditures does not exceed
in any fiscal year of the Borrower set forth below the amount set forth
opposite such fiscal year below:
Fiscal Year Ending Amount
__________________ _______
December 31, 1998 $85,000,000
December 31, 1999 $95,000,000
December 31, 2000 $120,000,000
December 31, 2001 $130,000,000
December 31, 2002 $130,000,000
(b) In addition to the foregoing, in the event that the amount of
Capital Expenditures permitted to be made by the Borrower and its Subsidiaries
pursuant to clause (a) above in any fiscal year of the Borrower (before giving
effect to any increase in such permitted Capital Expenditure amount pursuant to
this clause (b)) is greater than the amount of Capital Expenditures actually
made by the Borrower and its Subsidiaries during such fiscal year, the lesser of
(x) such excess and (y) 25% of the applicable permitted scheduled Capital
Expenditure amount as set forth in such clause (a) above may be carried forward
and utilized to make Capital Expenditures in the immediately succeeding fiscal
year, provided that no amounts once carried forward pursuant to this Section
9.07(b) may be carried forward to any fiscal year thereafter and such amounts
may only be utilized after the Borrower and its Subsidiaries have utilized in
full the permitted Capital Expenditure amount for such fiscal year as set forth
in the table in clause (a) above (without giving effect to any increase in such
amount by operation of this clause (b)).
(c) In addition to the foregoing, the Borrower and its Subsidiaries
may make Capital Expenditures with the amount of Net Sale Proceeds received by
the Borrower or any of its Subsidiaries from any Asset Sale so long as such Net
Sale Proceeds are reinvested in replacement assets within 270 days following the
date of such Asset Sale to the extent such Net Sale Proceeds are not otherwise
required to be applied to reduce the Total Revolving Loan Commitment pursuant to
Section 3.03(b).
(d) In addition to the foregoing, the Borrower and its Subsidiaries
may make Capital Expenditures with the amount of Net Insurance Proceeds received
by the Borrower or any of its Subsidiaries from any Recovery Event so long as
such Net Insurance Proceeds are used to replace or restore any properties or
assets in respect of which such Net Insurance Proceeds were paid within 270 days
following the date of receipt of such Net Insurance Proceeds from such Recovery
Event to the extent such Net Insurance Proceeds are not otherwise required to be
applied to reduce the Total Revolving Loan Commitment pursuant to
Section 3.03(d).
(e) In addition to the foregoing, the Borrower and its Wholly-Owned
Subsidiaries may consummate Permitted Acquisitions to the extent permitted by
Section 9.02(ix).
9.08 Consolidated Interest Coverage Ratio. The Borrower will not
permit the Consolidated Interest Coverage Ratio for any Test Period ending on
the last day of a fiscal quarter set forth below to be less than the ratio set
forth opposite such fiscal quarter below:
Fiscal Quarter Ending Ratio
_____________________ _____
December 31, 1997 4.00:1.00
March 31, 1998 4.00:1.00
June 30, 1998 4.00:1.00
September 30, 1998 4.50:1.00
December 31, 1998 4.50:1.00
March 31, 1999 4.50:1.00
June 30, 1999 4.50:1.00
September 30, 1999 5.00:1.00
December 31, 1999 5.00:1.00
March 31, 2000 5.00:1.00
June 30, 2000 5.00:1.00
September 30, 2000 5.50:1.00
December 31, 2000 5.50:1.00
March 31, 2001 5.50:1.00
June 30, 2001 5.50:1.00
September 30, 2001 and
the last day of each fiscal
quarter thereafter 6.00:1.00
9.09 Maximum Leverage Ratio. The Borrower will not permit the
Leverage Ratio at any time during a period set forth below to be greater than
the ratio set forth opposite such period below:
Period Ratio
______ _____
Restatement Effective Date through
and including June 30, 2000 3.00:1.00
July 1, 2000 through
and including June 30, 2001 2.50:1.00
July 1, 2001
and thereafter 2.25:1.00
9.10 Minimum Consolidated EBITDA. The Borrower will not permit
Consolidated EBITDA for any Test Period ending on the last day of a fiscal
quarter set forth below to be less than the amount set forth opposite such
fiscal quarter below:
Fiscal Quarter Ending Amount
_____________________ ______
December 31, 1997 $50,000,000
March 31, 1998 $50,000,000
June 30, 1998 $50,000,000
September 30, 1998 $60,000,000
December 31, 1998 $60,000,000
March 31, 1999 $60,000,000
June 30, 1999 $60,000,000
September 30, 1999
and the last day of
each fiscal quarter thereafter $75,000,000
9.11 Limitation on Modifications of Certificate of Incorporation, By-
Laws, SAP Joint Venture Documents and Senior Subordinated Note Documents; etc.
(a) The Borrower will not, and will not permit any of its Subsidiaries to, (i)
amend, modify or change its certificate or articles of incorporation (including,
without limitation, by the filing or modification of any certificate of
designation) or by-laws (or the equivalent organizational documents) or the SAP
Joint Venture Documents unless any such amendment, modification or change could
not be adverse to the interests of the Banks or (ii) amend, modify or change any
of the Senior Subordinated Note Documents.
(b) Neither the Borrower nor any of its Subsidiaries shall designate
any Indebtedness, other than the Obligations, as "Designated Senior Debt" for
purposes of the Senior Subordinated Notes and the other Senior Subordinated Note
Documents.
9.12 Limitation on Certain Restrictions on Subsidiaries. The
Borrower will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any such Subsidiary to (a) pay
dividends or make any other distributions on its capital stock or any other
interest or participation in its profits owned by the Borrower or any Subsidiary
of the Borrower, or pay any Indebtedness owed to the Borrower or any Subsidiary
of the Borrower, (b) make loans or advances to the Borrower or any Subsidiary of
the Borrower or (c) transfer any of its properties or assets to the Borrower or
any Subsidiary of the Borrower, except for such encumbrances or restrictions
existing under or by reason of (i) applicable law, (ii) this Agreement and the
other Credit Documents, (iii) customary provisions restricting subletting or
assignment of any lease governing a leasehold interest of the Borrower or any
Subsidiary of the Borrower, (iv) customary provisions restricting assignment of
any licensing agreement or agreements for the provision of services entered into
by the Borrower or any Subsidiary of the Borrower in the ordinary course of
business and (v) restrictions on the transfer of any asset subject to a Lien
permitted by Section 9.01.
9.13 Limitation on Issuance of Capital Stock. (a) The Borrower will
not, and will not permit any of its Subsidiaries to, issue (i) any preferred
stock (other than Qualified Preferred Stock of the Borrower) or (ii) any
redeemable common stock (other than common stock that is redeemable at the sole
option of the Borrower or such Subsidiary).
(b) The Borrower will not permit any of its Subsidiaries to issue any
capital stock (including by way of sales of treasury stock) or any options or
warrants to purchase, or securities convertible into, capital stock, except (i)
for transfers and replacements of then outstanding shares of capital stock, (ii)
for stock splits, stock dividends and issuances which do not decrease the
percentage ownership of the Borrower or any of its Subsidiaries in any class of
the capital stock of such Subsidiary, (iii) to qualify directors to the extent
required by applicable law or (iv) for issuances by newly created or acquired
Subsidiaries in accordance with the terms of this Agreement.
9.14 Business. The Borrower and its Subsidiaries will not engage in
any businesses other than the businesses engaged in by the Borrower and its
Subsidiaries as of the Restatement Effective Date and reasonable extensions
thereof.
9.15 Limitation on Creation of Subsidiaries. Notwithstanding
anything to the contrary contained in this Agreement, the Borrower will not, and
will not permit any of its Subsidiaries to, establish, create or acquire after
the Restatement Effective Date any Subsidiary, provided that the Borrower and
its Wholly-Owned Subsidiaries shall be permitted to establish, create or, to the
extent permitted by the Agreement, acquire (x) Wholly-Owned Subsidiaries so long
as (i) the capital stock or other equity interests of each such new Wholly-Owned
Subsidiary (to the extent owned by a Credit Party) is pledged pursuant to, and
to the extent required by, the Pledge Agreement, (ii) each such new Wholly-Owned
Subsidiary (other than a Foreign Subsidiary) executes a counterpart of the
Subsidiaries Guaranty, the Pledge Agreement and the Security Agreement, and
(iii) each such new Wholly-Owned Subsidiary (other than a Foreign Subsidiary)
executes and delivers, or causes to be executed and delivered, all other
relevant documentation of the type described in Section 5 as such new Wholly-
Owned Subsidiary would have had to deliver if such new Wholly-Owned Subsidiary
were a Credit Party on the Restatement Effective Date and (y) non-Wholly-Owned
Subsidiaries so long as the capital stock or other equity interest of each such
new non-Wholly-Owned Subsidiary (to the extent owned by a Credit Party) is
pledged pursuant to, and to the extent required by, the Pledge Agreement.
9.16 SAP Joint Venture Arrangements. Notwithstanding anything to the
contrary contained in Sections 9.02, 9.03, 9.04, 9.05 and 9.06, the Borrower and
its Subsidiaries may enter into, and perform their respective obligations under,
the SAP Joint Venture Documents on the terms and conditions set forth in the
First Amendment and Consent, dated as of January 8, 1998, to the Original Credit
Agreement, provided that (i) in order for the Borrower or one of its
Subsidiaries to purchase any interest in the SAP Joint Venture held by the other
joint venture partner, the Borrower or such Subsidiary must comply with Section
9.02(ix), provided that the provisions of clauses (vi) and (vii) of such Section
9.02(ix) shall not be applicable to the Borrower or its respective Subsidiary
honoring its put obligations under the SAP Joint Venture Documents, (ii) any
sale by the Borrower or any of its Subsidiaries of any portion of their equity
interest in the SAP Joint Venture shall be treated as an Asset Sale the proceeds
of which shall be applied and/or reinvested as (and to the extent) required by
Section 3.03(b), and (iii) any Investments made by the Borrower or any of its
Subsidiaries in or to the SAP Joint Venture after the Restatement Effective Date
shall be subject to the provisions of Section 9.05(xv) as opposed to the
aggregate dollar limitations set forth in the First Amendment and Consent
referred to above.
SECTION 10. Events of Default. Upon the occurrence of any of the
following specified events (each an "Event of Default"):
10.01 Payments. The Borrower shall (i) default in the payment when
due of any principal of any Loan or any Note or (ii) default, and such default
shall continue unremedied for three or more Business Days, in the payment when
due of any interest on any Loan or Note, any Unpaid Drawing (or any interest
thereon) or any Fees or any other amounts owing hereunder or thereunder; or
10.02 Representations, etc. Any representation, warranty or
statement made (or deemed made) by any Credit Party herein or in any other
Credit Document or in any certificate delivered to the Agent or any Bank
pursuant hereto or thereto shall prove to be untrue in any material respect on
the date as of which made or deemed made; or
10.03 Covenants. Any Credit Party shall (i) default in the due
performance or observance by it of any term, covenant or agreement contained in
Section 8.01(f)(i) or 8.08 or Section 9 or (ii) default in the due performance
or observance by it of any other term, covenant or agreement contained in this
Agreement or any other Credit Document (other than those set forth in Sections
10.01 and 10.02) and such default shall continue unremedied for a period of 30
days after written notice thereof to the defaulting party by the Agent or the
Required Banks; or
10.04 Default Under Other Agreements. (i) The Borrower or any of
its Subsidiaries shall (x) default in any payment of any Indebtedness (other
than the Notes) beyond the period of grace, if any, provided in the instrument
or agreement under which such Indebtedness was created or (y) default in the
observance or performance of any agreement or condition relating to any
Indebtedness (other than the Notes) or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness (or a trustee or
agent on behalf of such holder or holders) to cause (determined without regard
to whether any notice is required), any such Indebtedness to become due prior to
its stated maturity, or (ii) any Indebtedness (other than the Notes) of the
Borrower or any of its Subsidiaries shall be declared to be (or shall become)
due and payable, or required to be prepaid other than by a regularly scheduled
required prepayment, prior to the stated maturity thereof, provided that it
shall not be a Default or an Event of Default under this Section 10.04 unless
the aggregate principal amount of all Indebtedness as described in preceding
clauses (i) and (ii) is at least $3,000,000; or
10.05 Bankruptcy, etc. The Borrower or any of its Subsidiaries shall
commence a voluntary case concerning itself under Title 11 of the United States
Code entitled "Bankruptcy," as now or hereafter in effect, or any successor
thereto (the "Bankruptcy Code"); or an involuntary case is commenced against the
Borrower or any of its Subsidiaries, and the petition is not controverted within
10 days, or is not dismissed within 60 days, after commencement of the case; or
a custodian (as defined in the Bankruptcy Code) is appointed for, or takes
charge of, all or substantially all of the property of the Borrower or any of
its Subsidiaries, or the Borrower or any of its Subsidiaries commences any other
proceeding under any reorganization, arrangement, adjustment of debt, relief of
debtors, dissolution, insolvency or liquidation or similar law of any jurisdic
tion whether now or hereafter in effect relating to the Borrower or any of its
Subsidiaries, or there is commenced against the Borrower or any of its
Subsidiaries any such proceeding which remains undismissed for a period of 60
days, or the Borrower or any of its Subsidiaries is adjudicated insolvent or
bankrupt; or any order of relief or other order approving any such case or
proceeding is entered; or the Borrower or any of its Subsidiaries suffers any
appointment of any custodian or the like for it or any substantial part of its
property to continue undischarged or unstayed for a period of 60 days; or the
Borrower or any of its Subsidiaries makes a general assignment for the benefit
of creditors; or any corporate action is taken by the Borrower or any of its
Subsidiaries for the purpose of effecting any of the foregoing; or
10.06 ERISA. (a) Any Plan shall fail to satisfy the minimum funding
standard required for any plan year or part thereof under Section 412 of the
Code or Section 302 of ERISA or a waiver of such standard or extension of any
amortization period is sought or granted under Section 412 of the Code or
Section 303 or 304 of ERISA, a Reportable Event shall have occurred, a
contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan
subject to Title IV of ERISA shall be subject to the advance reporting
requirement of PBGC Regulation Section 4043.61 (without regard to subparagraph
(b)(1) thereof) and an event described in subsection .62, .63, .64, .65, .66,
.67 or .68 of PBGC Regulation Section 4043 shall be reasonably expected to occur
with respect to such Plan within the following 30 days, any Plan which is
subject to Title IV of ERISA shall have had or is likely to have a trustee
appointed to administer such Plan, any Plan which is subject to Title IV of
ERISA is, shall have been or is likely to be terminated or to be the subject of
termination proceedings under ERISA, any Plan shall have an Unfunded Current
Liability, a contribution required to be made with respect to a Plan or a
Foreign Pension Plan has not been timely made, the Borrower or any Subsidiary of
the Borrower or any ERISA Affiliate has incurred or is likely to incur any
liability to or on account of a Plan under Section 409, 502(i), 502(l), 515,
4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971
or 4975 of the Code or on account of a group health plan (as defined in Section
607(1) of ERISA or Section 4980B(g)(2) of the Code) under Section 4980B of the
Code, or the Borrower or any Subsidiary of the Borrower has incurred or is
likely to incur liabilities pursuant to one or more employee welfare benefit
plans (as defined in Section 3(1) of ERISA) that provide benefits to retired
employees or other former employees (other than as required by Section 601 of
ERISA) or Plans or Foreign Pension Plans; (b) there shall result from any such
event or events the imposition of a lien, the granting of a security interest,
or a liability or a material risk of incurring a liability; and (c) such lien,
security interest or liability, individually, and/or in the aggregate, has had,
or could reasonably be expected to have, a material adverse effect on the
business, operations, properties, assets, liabilities, condition (financial or
otherwise) or prospects of the Borrower and its Subsidiaries taken as a whole;
or
10.07 Security Documents. At any time after the execution and
delivery thereof, any of the Security Documents shall cease to be in full force
and effect, or shall cease to give the Collateral Agent for the benefit of the
Secured Creditors the Liens, rights, powers and privileges purported to be
created thereby (including, without limitation, a perfected first priority
security interest in all of the Collateral, in favor of the Collateral Agent,
superior to and prior to the rights of all third Persons); or
10.08 Subsidiaries Guaranty. At any time after the execution and
delivery thereof, the Subsidiaries Guaranty or any provision thereof shall cease
to be in full force or effect as to any Subsidiary Guarantor, or any Subsidiary
Guarantor or any Person acting by or on behalf of such Subsidiary Guarantor
shall deny or disaffirm such Subsidiary Guarantor's obligations under the
Subsidiaries Guaranty or any Subsidiary Guarantor shall default in the due
performance or observance of any term, covenant or agreement on its part to be
performed or observed pursuant to the Subsidiaries Guaranty; or
10.09 Judgments. One or more judgments or decrees shall be entered
against the Borrower or any Subsidiary of the Borrower involving in the
aggregate for the Borrower and its Subsidiaries a liability (not paid or fully
covered by a reputable and solvent insurance company) and such judgments and
decrees either shall be final and non-appealable or shall not be vacated,
discharged or stayed or bonded pending appeal for any period of 30 consecutive
days, and the aggregate amount of all such judgments equals or exceeds
$3,000,000; or
10.10 Change of Control. A Change of Control shall occur; then, and
in any such event, and at any time thereafter, if any Event of Default shall
then be continuing, the Agent, upon the written request of the Required Banks,
shall by written notice to the Borrower, take any or all of the following
actions, without prejudice to the rights of any Agent, any Bank or the holder of
any Note to enforce its claims against any Credit Party (provided, that, if an
Event of Default specified in Section 10.05 shall occur with respect to the
Borrower, the result which would occur upon the giving of written notice by the
Agent as specified in clauses (i) and (ii) below shall occur automatically with
out the giving of any such notice): (i) declare the Total Revolving Loan
Commitment terminated, whereupon the Revolving Loan Commitment of each Bank
shall forthwith terminate immediately and any Commitment Commission shall
forthwith become due and payable without any other notice of any kind; (ii)
declare the principal of and any accrued interest in respect of all Loans and
the Notes and all Obligations owing hereunder and thereunder to be, whereupon
the same shall become, forthwith due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by each
Credit Party; (iii) terminate any Letter of Credit which may be terminated in
accordance with its terms; (iv) direct the Borrower to pay (and the Borrower
agrees that upon receipt of such notice, or upon the occurrence of an Event of
Default specified in Section 10.05 with respect to the Borrower, it will pay) to
the Collateral Agent at the Payment Office such additional amount of cash or
Cash Equivalents, to be held as security by the Collateral Agent, as is equal to
the aggregate Stated Amount of all Letters of Credit issued for the account of
the Borrower and then outstanding; (v) enforce, as Collateral Agent, all Liens,
rights and remedies created pursuant to any of the Security Documents; and (vi)
apply any cash collateral held by the Agent pursuant to Section 4.02 to the
repayment of the Obligations.
SECTION 11. Definitions and Accounting Terms.
11.01 Defined Terms. As used in this Agreement, the following terms
shall have the following meanings (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):
"Acquired Entity or Business" shall have the meaning provided in the
definition of "Consolidated Net Income".
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person. A Person shall be deemed to control another
Person if such Person possesses, directly or indirectly, the power (i) to vote
5% or more of the securities having ordinary voting power for the election of
directors of such corporation or (ii) to direct or cause the direction of the
management and policies of such other Person, whether through the ownership of
voting securities, by contract or otherwise.
"Affiliate Transaction" shall have the meaning provided in Section
9.06.
"Agent" shall mean BTCo, in its capacity as Agent for the Banks
hereunder, and shall include any successor to the Agent appointed pursuant to
Section 12.09.
"Agreement" shall mean this Credit Agreement, as modified,
supplemented, amended, restated (including any amendment and restatement
hereof), extended, renewed, refinanced or replaced from time to time.
"Applicable Eurodollar Rate Margin" shall mean a percentage per annum
equal to 1% less the then applicable Interest Reduction Discount, if any.
"Asset Sale" shall mean any sale, transfer or other disposition by the
Borrower or any of its Subsidiaries to any Person (including by-way-of
redemption by such Person) other than to the Borrower or a Wholly-Owned
Subsidiary of the Borrower of any asset (including, without limitation, any
capital stock or other securities of, or equity interests in, another Person)
other than sales of assets pursuant to Sections 9.02 (ii), (iii), (iv), (v) and
(x).
"Assignment and Assumption Agreement" shall mean an Assignment and
Assumption Agreement substantially in the form of Exhibit L (appropriately
completed).
"Bank" shall mean each financial institution listed on Schedule I, as
well as any Person which becomes a "Bank" hereunder pursuant to Section 1.13 or
13.04(b).
"Bank Default" shall mean (i) the refusal (which has not been
retracted) or the failure of a Bank to make available its portion of any
Borrowing required to be made available by it hereunder (including any Mandatory
Borrowing) or to fund its portion of any unreimbursed payment under Section
2.04(c) or (ii) a Bank having notified in writing the Borrower and/or the Agent
that such Bank does not intend to comply with its obligations under Section
1.01(a), 1.01(c) or 2, in the case of either clause (i) or (ii) as a result of
any takeover or control (including, without limitation, as a result of the
occurrence of any event of the type described in Section 10.05 with respect to
such Bank) of such Bank by any regulatory authority or agency.
"Bankruptcy Code" shall have the meaning provided in Section 10.05.
"Base Rate" shall mean, at any time, the higher of (i) the Prime
Lending Rate and (ii) 1/2 of 1% in excess of the Federal Funds Rate.
"Base Rate Loan" shall mean (i) each Swingline Loan and (ii) each
Revolving Loan designated or deemed designated as such by the Borrower at the
time of the incurrence thereof or conversion thereto.
"Borrower" shall have the meaning provided in the first paragraph of
this Agreement.
"Borrowing" shall mean (i) the borrowing of Swingline Loans from the
Swingline Bank on a given date and (ii) the borrowing of one Type of Revolving
Loan from all the Banks on a given date (or resulting from a conversion or
conversions on such date) having in the case of Eurodollar Loans the same
Interest Period, provided that (x) Base Rate Loans incurred pursuant to Section
1.10(b) shall be considered part of the related Borrowing of Eurodollar Loans
and (y) each Borrowing applicable to each of the Original Revolving Loans
outstanding on the Restatement Effective Date (and after giving effect to the
payments required by Section 5.05) shall continue to be applicable thereto as if
the Original Credit Agreement had not been amended and restated as herein
provided (although such Original Revolving Loans shall constitute Revolving
Loans as provided for in this Agreement).
"Borrowing Base" shall mean, as at any date on which the amount
thereof is being determined, an amount equal to 80% of Eligible Receivables as
determined from the Borrowing Base Certificate most recently delivered pursuant
to Section 8.01(i).
"Borrowing Base Certificate" shall have the meaning provided in
Section 8.01(i).
"BTCo" shall mean Bankers Trust Company, in its individual capacity,
and any successor corporation thereto by merger, consolidation or otherwise.
"Business Day" shall mean (i) for all purposes other than as covered
by clause (ii) below, any day except Saturday, Sunday and any day which shall be
in New York City, New York, a legal holiday or a day on which banking
institutions are authorized or required by law or other government action to
close and (ii) with respect to all notices and determinations in connection
with, and payments of principal and interest on, Eurodollar Loans, any day which
is a Business Day described in clause (i) above and which is also a day for
trading by and between banks in the New York interbank Eurodollar market.
"Capital Expenditures" shall mean, with respect to any Person, all
expenditures by such Person which should be capitalized in accordance with
generally accepted accounting principles, but excluding the amount of
Capitalized Lease Obligations incurred by such Person.
"Capitalized Lease Obligations" shall mean, with respect to any
Person, all rental obligations of such Person which, under generally accepted
accounting principles, are or will be required to be capitalized on the books of
such Person, in each case taken at the amount thereof accounted for as
indebtedness in accordance with such principles.
"Cash Equivalents" shall mean, as to any Person, (i) securities issued
or directly and fully guaranteed or insured by the United States or any agency
or instrumentality thereof (provided that the full faith and credit of the
United States is pledged in support thereof) having maturities of not more than
one year from the date of acquisition, (ii) Dollar denominated time deposits and
certificates of deposit of any commercial bank having, or which is the principal
banking subsidiary of a bank holding company having, a long-term unsecured debt
rating of at least "A" or the equivalent thereof from Standard & Poor's Ratings
Services or "A2" or the equivalent thereof from Moody's Investors Service, Inc.
with maturities of not more than one year from the date of acquisition by such
Person, (iii) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clause (i) above entered into
with any bank meeting the qualifications specified in clause (ii) above, (iv)
commercial paper issued by any Person incorporated in the United States rated at
least A-1 or the equivalent thereof by Standard & Poor's Ratings Services or at
least P-1 or the equivalent thereof by Moody's Investors Service, Inc. and in
each case maturing not more than one year after the date of acquisition by such
Person, (v) marketable direct obligations issued by the District of Columbia or
any State of the United States or any political subdivision of any such State or
any public instrumentality thereof maturing within one year from the date of
acquisition and, at the time of acquisition, having one of the two highest
ratings obtainable from either Standard & Poor's Ratings Services or Moody's
Investors Service, Inc. and (vi) investments in money market funds substantially
all of whose assets are comprised of securities of the types described in
clauses (i) through (v) above.
"Cash Proceeds" shall mean, with respect to any Asset Sale, the
aggregate cash payments (including any cash received by way of deferred payment
pursuant to a note receivable issued in connection with such Asset Sale or
pursuant to a receivable or otherwise, other than (in each case) the portion of
such deferred payment constituting interest, but only as and when so received)
received by the Borrower and/or any of its Subsidiaries from such Asset Sale.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as the same may be amended from time to
time, 42 U.S.C. Section 9601 et seq.
"Change of Control" shall mean (i) any Person or "group" (within the
meaning of Section 13(d) and 14(d) under the Securities Exchange Act, as in
effect on the Restatement Effective Date), shall (A) have acquired beneficial
ownership of 25% or more on a fully diluted basis of the voting and/or economic
interest in the Borrower's capital stock or (B) obtained the power (whether or
not exercised) to elect a majority of the Borrower's directors or (ii) the Board
of Directors of the Borrower shall cease to consist of a majority of Continuing
Directors or (iii) any "change of control" under, and as defined in, the Senior
Subordinated Note Indenture.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and rulings issued thereunder.
Section references to the Code are to the Code, as in effect on the Restatement
Effective Date and any subsequent provisions of the Code, amendatory thereof,
supplemental thereto or substituted therefor.
"Collateral" shall mean the Pledge Agreement Collateral, the Security
Agreement Collateral and all cash and Cash Equivalents delivered as collateral
pursuant to Section 4.02 or 10.
"Collateral Agent" shall mean the Agent acting as collateral agent for
the Secured Creditors pursuant to the Security Documents.
"Commitment Commission" shall have the meaning set forth in Section
3.01.
"Consolidated EBIT" shall mean, for any period, Consolidated Net
Income for such period before Consolidated Interest Expense and provision for
taxes for such period and without giving effect (x) to any extraordinary gains
or losses and (y) to any gains or losses from sales of assets other than from
sales of inventory sold in the ordinary course of business.
"Consolidated EBITDA" shall mean, for any period, Consolidated EBIT
for such period, adjusted by adding thereto the amount of all amortization of
intangibles and depreciation that were deducted in arriving at Consolidated EBIT
for such period (including deferred financing, legal and accounting costs
associated with the Original Credit Agreement, this Agreement and the Senior
Subordinated Notes), but determined without giving effect to any non-cash
charges of up to $8,500,000 in the aggregate which is taken by the Borrower on
or prior to December 31, 1998 in connection with the revaluation of the
businesses of SITEL Telebusiness New Zealand Limited, SITEL Telebusiness
Australia Pty Limited and/or SITEL Telebusiness Singapore Pte Ltd..
"Consolidated Indebtedness" shall mean, at any time, the principal
amount of all Indebtedness of the Borrower and its Subsidiaries at such time as
determined on a consolidated basis.
"Consolidated Interest Coverage Ratio" shall mean, for any period, the
ratio of Consolidated EBITDA to Consolidated Interest Expense for such period.
"Consolidated Interest Expense" shall mean, for any period, the total
consolidated interest expense of the Borrower and its Subsidiaries for such
period (calculated without regard to any limitations on the payment thereof)
plus, without duplication, that portion of Capitalized Lease Obligations of the
Borrower and its Subsidiaries representing the interest factor for such period;
provided that the amortization of deferred financing costs with respect to this
Agreement, the Original Credit Agreement and the Senior Subordinated Notes shall
be excluded from Consolidated Interest Expense to the extent same would
otherwise have been included therein.
"Consolidated Net Income" shall mean, for any period, the net income
(or loss) of the Borrower and its Subsidiaries for such period, determined on a
consolidated basis (and after deductions for minority interests), provided that
(i) the net income of any other Person which is not a Subsidiary of the Borrower
or is accounted for by the Borrower by the equity method of accounting shall be
included only to the extent of the payment of dividends or distributions by such
other Person to the Borrower or a Subsidiary thereof during such period and (ii)
the net income of any Subsidiary of the Borrower shall be excluded to the extent
that the declaration or payment of dividends or similar distributions by that
Subsidiary of its income is not at the time permitted by operation of the terms
of its charter or any agreement, instrument or law applicable to such
Subsidiary; provided that for purposes of Section 9.09 and the definition of
Interest Reduction Discount, there shall be included (to the extent not already
included) in determining Consolidated Net Income for any period the net income
(or loss) of any Person, business, property or asset acquired during such period
pursuant to a Permitted Acquisition or pursuant to an Investment made under
Section 9.05(xv) and not subsequently sold or otherwise disposed of by the
Borrower or one of its Subsidiaries during such period (each such Person,
business, property or asset acquired and not subsequently disposed of during
such period, an "Acquired Entity or Business"), in each case based on the actual
net income (or loss) of such Acquired Entity or Business for the entire period
(including the portion thereof occurring prior to such acquisition) (but after
any deductions for minority interests).
"Contingent Obligation" shall mean, as to any Person, any obligation
of such Person as a result of such Person being a general partner of the other
Person, unless the underlying obligation is expressly made non-recourse as to
such general partner, and any obligation of such Person guaranteeing or intended
to guarantee any Indebtedness, leases, dividends or other obligations ("primary
obligations") of any other Person (the "primary obligor") in any manner, whether
directly or indirectly, including, without limitation, any obligation of such
Person, whether or not contingent, (i) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (ii) to
advance or supply funds (x) for the purchase or payment of any such primary
obligation or (y) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary
obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation or (iv) otherwise
to assure or hold harmless the holder of such primary obligation against loss in
respect thereof; provided, however, that the term Contingent Obligation shall
not include endorsements of instruments for deposit or collection in the
ordinary course of business. The amount of any Contingent Obligation shall be
deemed to be an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Contingent Obligation is made or, if not
stated or determinable, the maximum reasonably anticipated liability in respect
thereof (assuming such Person is required to perform thereunder) as determined
by such Person in good faith.
"Continuing Directors" shall mean the directors of the Borrower on the
Restatement Effective Date and each other director if such director's nomination
for election to the Board of Directors of the Borrower is recommended by a
majority of the then Continuing Directors.
"Credit Documents" shall mean this Agreement and, after the execution
and delivery thereof pursuant to the terms of this Agreement, each Note, the
Subsidiaries Guaranty and each Security Document.
"Credit Event" shall mean the making of any Loan or the issuance of
any Letter of Credit.
"Credit Party" shall mean the Borrower and each Subsidiary Guarantor.
"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulting Bank" shall mean any Bank with respect to which a Bank
Default is in effect.
"Dividend" shall mean, with respect to any Person, that such Person
has declared or paid a dividend or returned any equity capital to its
stockholders or partners or authorized or made any other distribution, payment
or delivery of property (other than common stock of such Person) or cash to its
stockholders or partners as such, or redeemed, retired, purchased or otherwise
acquired, directly or indirectly, for a consideration any shares of any class of
its capital stock or any partnership interests outstanding on or after the
Restatement Effective Date (or any options or warrants issued by such Person
with respect to its capital stock), or set aside any funds for any of the
foregoing purposes, or shall have permitted any of its Subsidiaries to purchase
or otherwise acquire for a consideration any shares of any class of the capital
stock or any partnership interests of such Person outstanding on or after the
Restatement Effective Date (or any options or warrants issued by such Person
with respect to its capital stock). Without limiting the foregoing, "Dividends"
with respect to any Person shall also include all payments made or required to
be made by such Person with respect to any stock appreciation rights plans,
equity incentive or achievement plans or any similar plans or setting aside of
any funds for the foregoing purposes.
"Documents" shall mean the Credit Documents and the Senior
Subordinated Note Documents.
"Dollar Equivalent" shall mean, at any time of determination thereof,
the amount of Dollars which could be purchased with (or, in the case of Letters
of Credit denominated in a currency other than Dollars, the amount of Dollars
necessary to purchase) the amount of currency involved in such computation at
the spot exchange rate therefor as published in the New York edition of The Wall
Street Journal on the date one Business Day prior to the date of any
determination thereof, provided that if the New York edition of The Wall Street
Journal is not published on such date, reference shall be made to such rate as
set forth in the most recently published New York edition of The Wall Street
Journal, and provided further, that if at any time the New York edition of The
Wall Street Journal ceases to publish such exchange rates, the Dollar Equivalent
shall be the amount of Dollars which could be purchased with (or, in the case of
Letters of Credit denominated in a currency other than Dollars, the amount of
Dollars necessary to purchase) the amount of currency involved in such
computation at the spot rate therefor as quoted by the Agent at approximately
11:00 a.m. (London time) on the date two Business Days prior to the date of any
determination thereof for purchase on such date, it being understood and agreed,
however, that (i) in determining the Stated Amount of any Letter of Credit
issued in a currency other than Dollars (A) for purposes of Sections 1.01(a),
1.01(b), 2.02 and 4.02(a), the Dollar Equivalent thereof shall be calculated (x)
on the date of the issuance of such Letter of Credit, (y) on the first Business
Day of each calendar month thereafter and (z) on such other day as the Agent
may, in its sole discretion, consider appropriate and (B) for purposes of
Sections 3.01(a), 3.01(b) and 3.01(c), the Dollar Equivalent shall be calculated
on the first Business Day of each month in the quarterly period in which the
respective payment is due pursuant to said Sections, (ii) the Dollar Equivalent
for all reimbursement obligations with respect to all Letters of Credit issued
in a currency other than Dollars shall be determined by using the Dollar
Equivalent thereof as in effect on the date the respective Unpaid Drawing was
paid by such Issuing Bank and (iii) for purposes of determining compliance with
Section 9.04, the Dollar Equivalent of any Foreign Subsidiary Third Party
Borrowings or any such other Indebtedness incurred in a currency other than
Dollars shall be the Dollar Equivalent thereof as in effect on the last Business
Day of the then most recently ended fiscal quarter of the Borrower and such
Dollar Equivalent shall remain in effect until same is recalculated as of the
last Business Day of the immediately succeeding fiscal quarter.
"Dollars" and the sign "$" shall each mean freely transferable lawful
money of the United States.
"Domestic Subsidiary" shall mean each Subsidiary of the Borrower that
is incorporated under the laws of the United States or any State or territory
thereof.
"Drawing" shall have the meaning provided in Section 2.05(b).
"Effective Date" shall mean the "Effective Date" under, and as defined
in, the Original Credit Agreement.
"Eligible Receivables" shall mean the total face amount of the
receivables of the Borrower and the Subsidiary Guarantors which conform to the
representations and warranties contained in the Security Agreement (including by
the Collateral Agent having a first priority perfected security interest
therein) and at all times continue to be acceptable to the Collateral Agent in
its reasonable judgment, less any returns, discounts, claims, credit and
allowances of any nature (whether issued, owing, granted or outstanding) and
less reserves for any other matter affecting the creditworthiness of account
debtors owing the receivables and excluding (i) bill and hold (deferred
shipment) transactions, (ii) contracts or sales to any Affiliate of the Borrower
or any of its Subsidiaries, (iii) all receivables to the extent that same have
not been paid in full within 45 days of the due date thereof or which have been
disputed by the account debtor, (iv) governmental sales, and (v) sales to
account debtors outside the United States.
"Eligible Transferee" shall mean and include a commercial bank,
financial institution, any fund that invests in bank loans or, with the consent
of the Borrower (which consent shall not be unreasonably withheld or delayed),
any other "accredited investor" (as defined in Regulation D of the Securities
Act).
"End Date" shall mean, for any Margin Reduction Period, the last day
of such Margin Reduction Period.
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, directives,
claims, liens, notices of noncompliance or violation, investigations or
proceedings relating in any way to any Environmental Law or any permit issued,
or any approval given, under any such Environmental Law (hereafter, "Claims"),
including, without limitation, (a) any and all Claims by governmental or
regulatory authorities for enforcement, cleanup, removal, response, remedial or
other actions or damages pursuant to any applicable Environmental Law, and
(b) any and all Claims by any third party seeking damages, contribution, indemni
fication, cost recovery, compensation or injunctive relief in connection with
alleged injury or threat of injury to health, safety or the environment due to
the presence of Hazardous Materials.
"Environmental Law" shall mean any Federal, state, foreign or local
statute, law, rule, regulation, ordinance, code, guideline, written policy and
rule of common law now or hereafter in effect and in each case as amended, and
any judicial or administrative interpretation thereof, including any judicial or
administrative order, consent decree or judgment, relating to the environment,
employee health and safety or Hazardous Materials, including, without
limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33 U.S.C.
Section 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. Section 2601
et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et seq.; the Safe Drinking
Water Act, 42 U.S.C. Section 3803 et seq.; the Oil Pollution Act of 1990, 33
U.S.C. Section 2701 et seq.; the Emergency Planning and the Community Right-to-
Know Act of 1986, 42 U.S.C. Section 11001 et seq.; the Hazardous Material
Transportation Act, 49 U.S.C. Section 1801 et seq. and the Occupational Safety
and Health Act, 29 U.S.C. Section 651 et seq.; and any state and local or
foreign counterparts or equivalents, in each case as amended from time to time.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder. Section references to ERISA are to ERISA, as in effect on
the Restatement Effective Date and any subsequent provisions of ERISA,
amendatory thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in Section 3(9)
of ERISA) which together with the Borrower or a Subsidiary of the Borrower would
be deemed to be a "single employer" (i) within the meaning of Section 414(b),
(c), (m) or (o) of the Code or (ii) as a result of the Borrower or a Subsidiary
of the Borrower being or having been a general partner of such person.
"Eurodollar Loan" shall mean each Revolving Loan designated as such by
the Borrower at the time of the incurrence thereof or conversion thereto.
"Eurodollar Rate" shall mean (a) the offered quotation to first-class
banks in the New York interbank Eurodollar market by BTCo for Dollar deposits of
amounts in immediately available funds comparable to the outstanding principal
amount of the Eurodollar Loan of BTCo with maturities comparable to the Interest
Period applicable to such Eurodollar Loan commencing two Business Days
thereafter as of 11:00 A.M. (New York time) on the date which is two Business
Days prior to the commencement of such Interest Period, divided (and rounded
upward to the nearest 1/16 of 1%) by (b) a percentage equal to 100% minus the
then stated maximum rate of all reserve requirements (including, without
limitation, any marginal, emergency, supplemental, special or other reserves
required by applicable law) applicable to any member bank of the Federal Reserve
System in respect of Eurocurrency funding or liabilities as defined in
Regulation D (or any successor category of liabilities under Regulation D).
"Event of Default" shall have the meaning provided in Section 10.
"Existing Indebtedness" shall have the meaning provided in Section
7.21.
"Existing Letters of Credit" shall have the meaning provided in
Section 2.01(a).
"Federal Funds Rate" shall mean, for any period, a fluctuating
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three Federal Funds brokers of
recognized standing selected by the Agent.
"Fees" shall mean all amounts payable pursuant to or referred to in
Section 3.01.
"Final Maturity Date" shall mean July 24, 2002.
"Foreign Pension Plan" shall mean any plan, fund (including, without
limitation, any superannuation fund) or other similar program established or
maintained outside the United States of America by the Borrower or any one or
more of its Subsidiaries primarily for the benefit of employees of the Borrower
or such Subsidiaries residing outside the United States of America, which plan,
fund or other similar program provides, or results in, retirement income, a
deferral of income in contemplation of retirement or payments to be made upon
termination of employment, and which plan is not subject to ERISA or the Code.
"Foreign Subsidiary" shall mean each Subsidiary of the Borrower which
is not a Domestic Subsidiary.
"Foreign Subsidiary Third Party Borrowings" shall have the meaning
provided in Section 9.04(v).
"Hazardous Materials" shall mean (a) any petroleum or petroleum
products, radioactive materials, asbestos in any form that is friable, urea
formaldehyde foam insulation, transformers or other equipment that contain
dielectric fluid containing levels of polychlorinated biphenyls, and radon gas;
(b) any chemicals, materials or substances defined as or included in the
definition of "hazardous substances," "hazardous waste," "hazardous materials,"
"extremely hazardous substances," "restricted hazardous waste," "toxic sub
stances," "toxic pollutants," "contaminants," or "pollutants," or words of
similar import, under any applicable Environmental Law; and (c) any other
chemical, material or substance, the Release of which is prohibited, limited or
regulated by any governmental authority.
"Indebtedness" shall mean, as to any Person, without duplication, (i)
all indebtedness (including principal, interest, fees and charges) of such
Person for borrowed money or for the deferred purchase price of property or
services, (ii) the maximum amount available to be drawn under all letters of
credit issued for the account of such Person and all unpaid drawings in respect
of such letters of credit, (iii) all Indebtedness of the types described in
clause (i), (ii), (iv), (v), (vi) or (vii) of this definition secured by any
Lien on any property owned by such Person, whether or not such Indebtedness has
been assumed by such Person (provided, that, if the Person has not assumed or
otherwise become liable in respect of such Indebtedness, such Indebtedness shall
be deemed to be in an amount equal to the fair market value of the property to
which such Lien relates as determined in good faith by such Person), (iv) the
aggregate amount required to be capitalized under leases under which such Person
is the lessee, (v) all obligations of such person to pay a specified purchase
price for goods or services, whether or not delivered or accepted, i.e., take-or
- -pay and similar obligations, (vi) all Contingent Obligations of such Person and
(vii) all obligations under any Interest Rate Protection Agreement, any Other
Hedging Agreement or under any similar type of agreement. Notwithstanding the
foregoing, Indebtedness shall not include trade payables and accrued expenses
incurred by any Person in accordance with customary practices and in the
ordinary course of business of such Person.
"Independent Financial Advisor" shall mean a firm (i) which does not,
and whose directors, officers and employees or Affiliates do not, have a direct
or indirect financial interest in the Borrower and (ii) which, in the judgment
of the Board of Directors of the Borrower, is otherwise independent and
qualified to perform the task for which it is to be engaged.
"Intercompany Loan" shall have the meaning provided in Section
9.05(ix).
"Intercompany Note" shall mean a promissory note, in the form of
Exhibit N or such other form as may be reasonably acceptable to the Agent, in
either case evidencing Intercompany Loans, provided that any Intercompany Note
in which the Borrower is the obligor shall contain the subordination provisions
set forth on Exhibit N.
"Interest Determination Date" shall mean, with respect to any
Eurodollar Loan, the second Business Day prior to the commencement of any
Interest Period relating to such Eurodollar Loan.
"Interest Period" shall have the meaning provided in Section 1.09.
"Interest Rate Protection Agreement" shall mean any interest rate swap
agreement, interest rate cap agreement, interest collar agreement, interest rate
hedging agreement or other similar agreement or arrangement.
"Interest Reduction Discount" shall mean (i) for the period from the
Restatement Effective Date through but not including the first Start Date, zero,
and (ii) from and after any Start Date after the Restatement Effective Date to
and including the corresponding End Date the percentage set forth in clause (A)
or (B) below to the extent that the condition set forth in clause (A) or (B)
below is satisfied (and to the extent that neither such condition is satisfied
the Interest Reduction Discount shall be zero):
(A) 1/4 of 1% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
less than or equal to 2.25:1.00 and greater than or equal to 1.50:1.00; or
(B) 3/8 of 1% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
less than 1.50:1.00.
Notwithstanding anything to the contrary above in this definition, the Interest
Reduction Discount shall be reduced to zero at all times when a Default or an
Event of Default shall exist.
"Investment Reference Date" shall have the meaning provided in Section
9.05(xv).
"Investments" shall have the meaning provided in Section 9.05.
"Issuing Bank" shall mean BTCo, U.S. Bank and any other Bank which at
the request of the Borrower and with the consent of the Agent agrees, in such
Bank's sole discretion, to become an Issuing Bank for the purpose of issuing
Letters of Credit pursuant to Section 2.
"Judgment Currency" shall have the meaning provided in Section
13.17(a).
"Judgment Currency Conversion Date" shall have the meaning provided in
Section 13.17(a).
"L/C Supportable Obligations" shall mean (i) obligations of the
Borrower or any of its Subsidiaries with respect to workers compensation, surety
bonds and other similar statutory obligations, (ii) all Foreign Subsidiary Third
Party Borrowings and (iii) such other obligations of the Borrower or any of its
Subsidiaries as are reasonably acceptable to the respective Issuing Bank and
otherwise permitted to exist pursuant to the terms of this Agreement.
"Leaseholds" of any Person shall mean all the right, title and
interest of such Person as lessee or licensee in, to and under leases or
licenses of land, improvements and/or fixtures.
"Letter of Credit" shall have the meaning provided in Section 2.01(a).
"Letter of Credit Fee" shall have the meaning provided in Section
3.01(b).
"Letter of Credit Outstandings" shall mean, at any time, the sum of
(i) the aggregate Stated Amount of all outstanding Letters of Credit at such
time and (ii) the amount of all Unpaid Drawings at such time.
"Letter of Credit Request" shall have the meaning provided in Section
2.03(a).
"Leverage Ratio" shall mean, at any time, the ratio of Consolidated
Indebtedness at such time to Consolidated EBITDA for the Test Period then most
recently ended, provided that, for purposes of calculating the Interest
Reduction Discount, the foregoing numerator shall instead be the sum of (I)
Consolidated Indebtedness (excluding Revolving Outstandings) at such time plus
(II) the average Revolving Outstandings for the then most recently ended fiscal
quarter of the Borrower.
"Lien" shall mean any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), preference,
priority or other security agreement of any kind or nature whatsoever
(including, without limitation, any conditional sale or other title retention
agreement, any financing or similar statement or notice filed under the UCC or
any other similar recording or notice statute, and any lease having
substantially the same effect as any of the foregoing).
"Loan" shall mean each Revolving Loan and each Swingline Loan.
"Mandatory Borrowing" shall have the meaning provided in Section
1.01(c).
"Margin Reduction Period" shall mean each period which shall commence
on a date on which the financial statements are delivered pursuant to Section
8.01(a) or (b), as the case may be, and which shall end on the earlier of (i)
the date of actual delivery of the next financial statements pursuant to Section
8.01(a) or (b), as the case may be, and (ii) the latest date on which the next
financial statements are required to be delivered to Section 8.01(a) or (b), as
the case may be.
"Margin Stock" shall have the meaning provided in Regulation U.
"Maximum Swingline Amount" shall mean $5,000,000.
"Minimum Borrowing Amount" shall mean (i) for Revolving Loans,
$2,000,000 and (ii) for Swingline Loans, $250,000.
"NAIC" shall mean the National Association of Insurance Commissioners.
"Net Debt Proceeds" shall mean, with respect to any incurrence of
Indebtedness for borrowed money, the cash proceeds (net of underwriting
discounts and commissions and other reasonable costs associated therewith)
received by the respective Person from the respective incurrence of such
Indebtedness for borrowed money.
"Net Equity Proceeds" shall mean, with respect to each issuance or
sale of any equity by any Person or any capital contribution to such Person, the
cash proceeds (net of underwriting discounts and commissions and other costs
associated therewith) received by such Person from the respective sale or
issuance of its equity or from the respective capital contribution.
"Net Insurance Proceeds" shall mean, with respect to any Recovery
Event, the cash proceeds (net of reasonable costs and taxes incurred in
connection with such Recovery Event) received by the respective Person in
connection with the respective Recovery Event.
"Net Sale Proceeds" shall mean, for any Asset Sale, the gross cash
proceeds (including any cash received by way of deferred payment pursuant to a
promissory note, receivable or otherwise, but only as and when received)
received from such Asset Sale, net of the reasonable costs of such sale
(including fees and commissions, payments of unassumed liabilities relating to
the assets sold and required payments of any Indebtedness which is secured by
the respective assets which were sold), and the incremental taxes paid or
payable as a result of such Asset Sale.
"Non-Defaulting Bank" shall mean and include each Bank other than a
Defaulting Bank.
"Note" shall mean each Revolving Note and the Swingline Note.
"Notice of Borrowing" shall have the meaning provided in Section
1.03(a).
"Notice of Conversion" shall have the meaning provided in Section
1.06.
"Notice Office" shall mean the office of the Agent located at 130
Liberty Street, New York, New York 10006, Attention: Greg Perry or such other
office as the Agent may hereafter designate in writing as such to the other
parties hereto.
"Obligations" shall mean all amounts owing to the Agent, the
Collateral Agent, any Issuing Bank or any Bank pursuant to the terms of this
Agreement or any other Credit Document.
"Obligation Currency" shall have meaning provided in Section 13.17(a).
"Original Credit Agreement" shall have the meaning provided in the
recitals to this Agreement.
"Original Revolving Loans" shall mean the "Revolving Loans" under, and
as defined in, the Original Credit Agreement.
"Original Swingline Loans" shall mean the "Swingline Loans" under, and
as defined in, the Original Credit Agreement.
"Other Hedging Agreement" shall mean any foreign exchange contracts,
currency swap agreements, commodity agreements or other similar agreements or
arrangements designed to protect against the fluctuations in currency values.
"Participant" shall have the meaning provided in Section 2.04(a).
"Payment Office" shall mean the office of the Agent located at 130
Liberty Street, New York, New York 10006, or such other office as the Agent may
hereafter designate in writing as such to the other parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Section 4002 of ERISA, or any successor thereto.
"Permitted Acquisition" shall have the meaning provided in Section
9.02 (ix).
"Permitted Liens" shall have the meaning provided in Section 9.01.
"Person" shall mean any individual, partnership, joint venture, firm,
corporation, association, limited liability company, trust or other enterprise
or any government or political subdivision or any agency, department or
instrumentality thereof.
"Plan" shall mean any pension plan as defined in Section 3(2) of
ERISA, which is maintained or contributed to by (or to which there is an
obligation to contribute of) the Borrower or a Subsidiary of the Borrower or an
ERISA Affiliate, and each such plan for the five year period immediately
following the latest date on which the Borrower, or a Subsidiary of the Borrower
or an ERISA Affiliate maintained, contributed to or had an obligation to
contribute to such plan.
"Pledge Agreement Collateral" shall mean all "Collateral" as defined
in the Pledge Agreement.
"Pledgee" shall have the meaning provided in the Pledge Agreement.
"Pledged Securities" shall mean all "Pledged Securities" as defined in
the Pledge Agreement.
"Prime Lending Rate" shall mean the rate which BTCo announces from
time to time as its prime lending rate, the Prime Lending Rate to change when
and as such prime lending rate changes. The Prime Lending Rate is a reference
rate and does not necessarily represent the lowest or best rate actually charged
to any customer. BTCo may make commercial loans or other loans at rates of
interest at, above or below the Prime Lending Rate.
"Projections" shall mean the projections which were prepared by the
Borrower for the period ending on December 31, 2002 and which were delivered to
the Banks on or about March 5, 1998.
"Qualified Preferred Stock" shall mean any preferred stock of the
Borrower so long as the terms of any such preferred stock (i) do not contain any
mandatory put, redemption, repayment, sinking fund or other similar provision
occurring before July 31, 2003, (ii) do not require the cash payment of
dividends, (iii) do not contain any covenants, (iv) do not grant the holders
thereof any voting rights except for (x) voting rights required to be granted to
such holders under applicable law and (y) limited customary voting rights on
fundamental matters such as mergers, consolidations, sales of all or
substantially all of the assets of the Borrower, or liquidations involving the
Borrower, and (v) are otherwise reasonably satisfactory to the Agent.
"Quarterly Payment Date" shall mean the last Business Day of each
September, December, March and June occurring after the Restatement Effective
Date.
"RCRA" shall mean the Resource Conservation and Recovery Act, as the
same may be amended from time to time, 42 U.S.C. Section 6901 et seq.
"Real Property" of any Person shall mean all the right, title and
interest of such Person in and to land, improvements and fixtures, including
Leaseholds.
"Recovery Event" shall mean the receipt by the Borrower or any of its
Subsidiaries of any cash insurance proceeds or condemnation awards payable (i)
by reason of theft, loss, physical destruction, damage, taking or any other
similar event with respect to any property or assets of the Borrower or any of
its Subsidiaries and (ii) under any policy of insurance required to be
maintained under Section 8.03.
"Register" shall have the meaning provided in Section 13.15.
"Regulation D" shall mean Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof establishing reserve requirements.
"Regulation G" shall mean Regulation G of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation T" shall mean Regulation T of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation U" shall mean Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation X" shall mean Regulation X of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Release" shall mean the disposing, discharging, injecting, spilling,
pumping, leaking, leaching, dumping, emitting, escaping, emptying, pouring or
migrating, into or upon any land or water or air, or otherwise entering into the
environment.
"Replaced Bank" shall have the meaning provided in Section 1.13.
"Replacement Bank" shall have the meaning provided in Section 1.13.
"Reportable Event" shall mean an event described in Section 4043(c) of
ERISA with respect to a Plan that is subject to Title IV of ERISA other than
those events as to which the 30-day notice period is waived under subsection
.22, .23, .25, .27 or .28 of PBGC Regulation Section 4043.
"Required Banks" shall mean Non-Defaulting Banks the sum of whose
Revolving Loan Commitments (or after the termination thereof, outstanding
Revolving Loans and RL Percentages of outstanding Swingline Loans and Letter of
Credit Outstandings) represent an amount greater than 50% of the sum of the
Total Revolving Loan Commitment less the Revolving Loan Commitments of all
Defaulting Banks (or after the termination thereof, the sum of the then total
outstanding Revolving Loans of Non-Defaulting Banks and the aggregate RL
Percentages of Non-Defaulting Banks of the total outstanding Swingline Loans and
Letter of Credit Outstandings Swingline Loans at such time).
"Restatement Effective Date" shall have the meaning provided in
Section 13.10.
"Restricted Payment" shall mean (a) any authorization, declaration or
payment of any Dividends with respect to the Borrower or any of its
Subsidiaries, or (b) the making (or the giving of any notice in respect thereof)
by the Borrower or any of its Subsidiaries of any voluntary, optional or
mandatory payment or prepayment on or redemption or acquisition for value of
(including, without limitation, by way of depositing with the trustee with
respect thereto money or securities before due for the purpose of paying when
due) any of the Senior Subordinated Notes.
"Restricted Payment Reference Date" shall have the meaning provided in
Section 9.03(iii).
"Revolving Loan" shall have the meaning provided in Section 1.01(a).
"Revolving Loan Commitment" shall mean, for each Bank, the amount set
forth opposite such Bank's name in Schedule I directly below the column entitled
"Revolving Loan Commitment," as same may be (x) reduced from time to time
pursuant to Sections 3.02, 3.03 and/or 10 or (y) adjusted from time to time as a
result of assignments to or from such Bank pursuant to Section 1.13 or 13.04(b).
"Revolving Note" shall have the meaning provided in Section 1.05(a).
"Revolving Outstandings" shall mean, at any time, the sum of the
aggregate principal amount of all Revolving Loans and Swingline Loans then
outstanding plus the aggregate amount of all Letter of Credit Outstandings at
such time.
"RL Percentage" of any Bank at any time shall mean a fraction
(expressed as a percentage) the numerator of which is the Revolving Loan
Commitment of such Bank at such time and the denominator of which is the Total
Revolving Loan Commitment at such time, provided that if the RL Percentage of
any Bank is to be determined after the Total Revolving Loan Commitment has been
terminated, then the RL Percentages of the Banks shall be determined immediately
prior (and without giving effect) to such termination.
"SAP Joint Venture" shall mean the joint venture arrangement between
SITEL Asia Pacific Holdings Pte Ltd., Lend Lease Securities and Investments Pty
Limited and Lend Lease International Pty Limited evidenced by the SAP Joint
Venture Documents.
"SAP Joint Venture Documents" shall mean the Shareholders Agreement by
and among the Borrower, SITEL Asia Pacific Holdings Pte Ltd., SITEL Australia
Pty Ltd, Evergem Investments Pte Limited, Lend Lease Corporation Limited, Lend
Lease Securities and Investments Pty Limited and Lend Lease International Pty
Limited and the other definitive documentation for the SAP Joint Venture
executed in connection therewith.
"SEC" shall have the meaning provided in Section 8.01(g).
"Section 4.04(b)(ii) Certificate" shall have the meaning provided in
Section 4.04(b)(ii).
"Secured Creditors" shall have the meaning assigned that term in the
Security Documents.
"Securities Act" shall mean the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
"Securities Exchange Act" shall mean the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.
"Security Agreement" shall have the meaning provided in Section 5.09.
"Security Agreement Collateral" shall mean all "Collateral" as defined
in the Security Agreement.
"Security Document" shall mean and include each of the Security
Agreement and the Pledge Agreement.
"Senior Subordinated Note Documents" shall mean the Senior
Subordinated Note Indenture, the Senior Subordinated Notes, the Senior
Subordinated Note Offering Memorandum and each other document or agreement
relating to the issuance of the Senior Subordinated Notes.
"Senior Subordinated Note Indenture" shall mean the Indenture, dated
as of March 10, 1998 by and among the Borrower, the Subsidiary Guarantors and
The First National Bank of Maryland, as trustee.
"Senior Subordinated Note Offering Memorandum" shall mean the Offering
Memorandum, dated March 5, 1998, prepared in connection with the issuance of the
Senior Subordinated Notes.
"Senior Subordinated Notes" shall mean the Borrower's 9-1/4% Senior
Subordinated Notes due 2006.
"Start Date" shall mean, with respect to any Margin Reduction Period,
the first day of such Margin Reduction Period.
"Stated Amount" of each Letter of Credit shall mean, at any time, the
maximum amount available to be drawn thereunder (in each case determined without
regard to whether any conditions to drawing could then be met); provided that
the "Stated Amount" of each Letter of Credit denominated in a currency other
than Dollars shall be, on any date of calculation, the Dollar Equivalent of the
maximum amount available to be drawn in the respective currency thereunder
(determined without regard to whether any conditions to drawing could then be
met).
"Subsidiary" shall mean, as to any Person, (i) any corporation more
than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person and/or one or
more Subsidiaries of such Person and (ii) any partnership, limited liability
company, association, joint venture or other entity in which such Person and/or
one or more Subsidiaries of such Person has more than a 50% equity interest at
the time; provided that Grupo SITEL de Mexico, S.A. de C.V. shall be considered
a Subsidiary of the Borrower under this Agreement so long as the Borrower or a
Wholly Owned Subsidiary thereof owns at least 49% of the equity interest thereof
and controls the Board of Directors of such Person.
"Subsidiary Guarantor" shall mean each Wholly-Owned Domestic
Subsidiary of the Borrower.
"Subsidiaries Guaranty" shall have the meaning provided in Section
5.10.
"Swingline Bank" shall mean BTCo.
"Swingline Expiry Date" shall mean that date which is five Business
Days prior to the Final Maturity Date.
"Swingline Loan" shall have the meaning provided in Section 1.01(b).
"Swingline Note" shall have the meaning provided in Section 1.05(a).
"Taxes" shall have the meaning provided in Section 4.04(a).
"Test Date" shall mean, with respect to any Start Date, the last day
of the most recent fiscal quarter of the Borrower ended immediately prior to
such Start Date.
"Test Period" shall mean the four consecutive fiscal quarters of the
Borrower then last ended (in each case taken as one accounting period), provided
that for any determination made under Section 9.08 on and prior to March 31,
1998, such period shall be the period from July 1, 1997 to the last day of the
fiscal quarter of the Borrower then last ended (in each case taken as one
accounting period).
"Total Revolving Loan Commitment" shall mean, at any time, the sum of
the Revolving Loan Commitments of each of the Banks.
"Total Unutilized Revolving Loan Commitment" shall mean, at any time,
an amount equal to the remainder of (x) the Total Revolving Loan Commitment then
in effect less (y) the sum of the aggregate principal amount of all Revolving
Loans and Swingline Loans then outstanding plus the then aggregate amount of all
Letter of Credit Outstandings.
"Type" shall mean the type of Loan determined with regard to the
interest option applicable thereto, i.e., whether a Base Rate Loan or a
Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code as from time to time in
effect in the relevant jurisdiction.
"Unfunded Current Liability" of any Plan shall mean the amount, if
any, by which the actuarial present value of the accumulated plan benefits under
the Plan as of the close of its most recent plan year, determined in accordance
with actuarial assumptions at such time consistent with Statement of Financial
Accounting Standards No. 87, exceeds the market value of the assets allocable
thereto.
"United States" and "U.S." shall each mean the United States of
America.
"Unpaid Drawing" shall have the meaning provided for in Section
2.05(a).
"Unutilized Revolving Loan Commitment" shall mean, with respect to any
Bank at any time, such Bank's Revolving Loan Commitment at such time less the
sum of (i) the aggregate outstanding principal amount of all Revolving Loans
made by such Bank at such time and (ii) such Bank's RL Percentage of the Letter
of Credit Outstandings at such time.
"U.S Bank" shall mean U.S. Bank National Association.
"Wholly-Owned Domestic Subsidiary" shall mean each Domestic Subsidiary
of the Borrower that is also a Wholly-Owned Subsidiary of the Borrower.
"Wholly-Owned Foreign Subsidiary" shall mean each Foreign Subsidiary
of the Borrower that is also a Wholly-Owned Subsidiary of the Borrower.
"Wholly-Owned Subsidiary" shall mean, as to any Person, (i) any
corporation 100% of whose capital stock (other than director's qualifying
shares) is at the time owned by such Person and/or one or more Wholly-Owned
Subsidiaries of such Person and (ii) any partnership, limited liability company,
association, joint venture or other entity in which such Person and/or one or
more Wholly-Owned Subsidiaries of such Person has a 100% equity interest at such
time.
SECTION 12. The Agent.
12.01 Appointment. The Banks hereby irrevocably designate BTCo as
Agent (for purposes of this Section 12, the term "Agent" also shall include BTCo
in its capacity as Collateral Agent pursuant to the Security Documents) to act
as specified herein and in the other Credit Documents. Each Bank hereby
irrevocably authorizes, and each holder of any Note by the acceptance of such
Note shall be deemed irrevocably to authorize, the Agent to take such action on
their behalf under the provisions of this Agreement, the other Credit Documents
and any other instruments and agreements referred to herein or therein and to
exercise such powers and to perform such duties hereunder and thereunder as are
specifically delegated to or required of the Agent by the terms hereof and
thereof and such other powers as are reasonably incidental thereto. The Agent
may perform any of its duties hereunder by or through its officers, directors,
agents, employees or affiliates.
12.02 Nature of Duties. The Agent shall not have any duties or
responsibilities except those expressly set forth in this Agreement and in the
other Credit Documents. Neither the Agent nor any of its officers, directors,
agents, employees or affiliates shall be liable for any action taken or omitted
by them hereunder or under any other Credit Document or in connection herewith
or therewith, unless caused by its or their gross negligence or willful
misconduct. The duties of the Agent shall be mechanical and administrative in
nature; the Agent shall not have by reason of this Agreement or any other Credit
Document a fiduciary relationship in respect of any Bank or the holder of any
Note; and nothing in this Agreement or any other Credit Document, expressed or
implied, is intended to or shall be so construed as to impose upon the Agent any
obligations in respect of this Agreement or any other Credit Document except as
expressly set forth herein or therein.
12.03 Lack of Reliance on the Agent. Independently and without
reliance upon the Agent, each Bank and the holder of each Note, to the extent it
deemed or deems appropriate, has made and shall continue to make (i) its own
independent investigation of the financial condition and affairs of the Borrower
and its Subsidiaries in connection with the making and the continuance of the
Loans and the taking or not taking of any action in connection herewith and (ii)
its own appraisal of the creditworthiness of the Borrower and its Subsidiaries
and, except as expressly provided in this Agreement, the Agent shall not have
any duty or responsibility, either initially or on a continuing basis, to
provide any Bank or the holder of any Note with any credit or other information
with respect thereto, whether coming into its possession before the making of
the Loans or at any time or times thereafter. The Agent shall not be
responsible to any Bank or the holder of any Note for any recitals, statements,
information, representations or warranties herein or in any document,
certificate or other writing delivered in connection herewith or for the
execution, effectiveness, genuineness, validity, enforceability, perfection,
collectability, priority or sufficiency of this Agreement or any other Credit
Document or the financial condition of the Borrower or any of its Subsidiaries
or be required to make any inquiry concerning either the performance or
observance of any of the terms, provisions or conditions of this Agreement or
any other Credit Document, or the financial condition of the Borrower or any of
its Subsidiaries or the existence or possible existence of any Default or Event
of Default.
12.04 Certain Rights of the Agent. If the Agent shall request
instructions from the Required Banks or all of the Banks, as applicable, with
respect to any act or action (including failure to act) in connection with this
Agreement or any other Credit Document, the Agent shall be entitled to refrain
from such act or taking such action unless and until the Agent shall have
received instructions from the Required Banks or all of the Banks, as
applicable; and the Agent shall not incur liability to any Bank by reason of so
refraining. Without limiting the foregoing, no Bank or the holder of any Note
shall have any right of action whatsoever against the Agent as a result of the
Agent acting or refraining from acting hereunder or under any other Credit
Document in accordance with the instructions of the Required Banks or all of the
Banks, as applicable.
12.05 Reliance. The Agent shall be entitled to rely, and shall be
fully protected in relying, upon any note, writing, resolution, notice,
statement, certificate, telex, teletype or telecopier message, cablegram,
radiogram, order or other document or telephone message signed, sent or made by
any Person that the Agent believed to be the proper Person, and, with respect to
all legal matters pertaining to this Agreement and any other Credit Document and
its duties hereunder and thereunder, upon advice of counsel selected by the
Agent.
12.06 Indemnification. To the extent the Agent is not reimbursed and
indemnified by the Borrower or any of its Subsidiaries, the Banks will reimburse
and indemnify the Agent in proportion to their respective "percentage" as used
in determining the Required Banks for and against any and all liabilities,
obligations, losses, damages, penalties, claims, actions, judgments, costs,
expenses or disbursements of whatsoever kind or nature which may be imposed on,
asserted against or incurred by the Agent in performing its duties hereunder or
under any other Credit Document or in any way relating to or arising out of this
Agreement or any other Credit Document; provided that no Bank shall be liable
for any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
Agent's gross negligence or willful misconduct (as finally determined by a court
of competent jurisdiction).
12.07 The Agent in its Individual Capacity. With respect to its
obligation to make Loans, or issue or participate in Letters of Credit, under
this Agreement, the Agent shall have the rights and powers specified herein for
a "Bank" and may exercise the same rights and powers as though it were not
performing the duties specified herein; and the term "Banks," "Required Banks,"
"holders of Notes" or any similar terms shall, unless the context clearly
otherwise indicates, include the Agent in its individual capacity. The Agent
and its affiliates may accept deposits from, lend money to, and generally engage
in any kind of banking, investment banking, trust or other business with, or
provide debt financing, equity capital or other services (including financial
advisory services) to, any Credit Party or any Affiliate of any Credit Party (or
any Person engaged in a similar business with any Credit Party or any Affiliate
thereof) as if they were not performing the duties specified herein, and may
accept fees and other consideration from any Credit Party or any Affiliate of
any Credit Party for services in connection with this Agreement and otherwise
without having to account for the same to the Banks.
12.08 Holders. The Agent may deem and treat the payee of any Note as
the owner thereof for all purposes hereof unless and until a written notice of
the assignment, transfer or endorsement thereof, as the case may be, shall have
been filed with the Agent. 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, assignee or indorsee, as the case may be, of such Note or of any
Note or Notes issued in exchange therefor.
12.09 Resignation by the Agent. (a) The Agent may resign from the
performance of all its respective functions and duties hereunder and/or under
the other Credit Documents at any time by giving 15 Business Days' prior written
notice to the Banks. Such resignation shall take effect upon the appointment of
a successor Agent pursuant to clauses (b) and (c) below or as otherwise provided
below.
(b) Upon any such notice of resignation by the Agent, the Required
Banks shall appoint a successor Agent hereunder or thereunder who shall be a
commercial bank or trust company reasonably acceptable to the Borrower, which
acceptance shall not be unreasonably withheld or delayed (provided that the
Borrower's approval shall not be required if an Event of Default then exists).
(c) If a successor Agent shall not have been so appointed within such
15 Business Day period, the Agent with the consent of the Borrower (which
consent shall not be unreasonably withheld or delayed), shall then appoint a
successor Agent who shall serve as Agent hereunder or thereunder until such
time, if any, as the Required Banks appoint a successor Agent as provided above.
(d) If no successor Agent has been appointed pursuant to clause (b)
or (c) above by the 20th Business Day after the date such notice of resignation
was given by the Agent, the Agent's resignation shall become effective and the
Required Banks shall thereafter perform all the duties of the Agent hereunder
and/or under any other Credit Document until such time, if any, as the Required
Banks appoint a successor Agent as provided above.
12.10 Syndication Agent and Documentation Agent. Neither U.S. Bank
nor First Union National Bank shall have any duties or liability under this
Agreement solely in their capacity as Syndication Agent or Documentation Agent,
as the case may be.
SECTION 13. Miscellaneous.
13.01 Payment of Expenses, etc. The Borrower shall: (i) whether or
not the transactions herein contemplated are consummated, pay all reasonable
out-of-pocket costs and expenses of the Agent (including, without limitation,
the reasonable fees and disbursements of White & Case LLP) in connection with
the preparation, execution and delivery of this Agreement and the other Credit
Documents and the documents and instruments referred to herein and therein and
any amendment, waiver or consent relating hereto or thereto, of the Agent in
connection with its syndication efforts with respect to this Agreement and of
the Agent and, after the occurrence of an Event of Default, each of the Banks in
connection with the enforcement of this Agreement and the other Credit Documents
and the documents and instruments referred to herein and therein (including,
without limitation, the reasonable fees and disbursements of counsel for the
Agent and, after the occurrence of an Event of Default, for each of the Banks);
(ii) pay and hold each of the Banks harmless from and against any and all
present and future stamp, excise and other similar documentary taxes with
respect to the foregoing matters and save each of the Banks harmless from and
against any and all liabilities with respect to or resulting from any delay or
omission (other than to the extent attributable to such Bank) to pay such taxes;
and (iii) indemnify the Agent and each Bank, and each of their respective
officers, directors, employees, representatives and agents from and hold each of
them harmless against any and all liabilities, obligations (including removal or
remedial actions), losses, damages, penalties, claims, actions, judgments,
suits, costs, expenses and disbursements (including reasonable attorneys' and
consultants' fees and disbursements) incurred by, imposed on or assessed against
any of them as a result of, or arising out of, or in any way related to, or by
reason of, (a) any investigation, litigation or other proceeding (whether or not
the Agent or any Bank is a party thereto and whether or not such investigation,
litigation or other proceeding is brought by or on behalf of any Credit Party)
related to the entering into and/or performance of this Agreement or any other
Credit Document or the use of any Letter of Credit or the proceeds of any Loans
hereunder or the consummation of any of the transactions contemplated herein or
in any other Credit Document or the exercise of any of their rights or remedies
provided herein or in the other Credit Documents, or (b) the actual or alleged
presence of Hazardous Materials in the air, surface water or groundwater or on
the surface or subsurface of any Real Property owned or at any time operated by
the Borrower or any of its Subsidiaries, the generation, storage,
transportation, handling or disposal of Hazardous Materials by the Borrower or
any of its Subsidiaries at any location, whether or not owned or operated by the
Borrower or any of its Subsidiaries, the non-compliance of any Real Property
with foreign, federal, state and local laws, regulations, and ordinances
(including applicable permits thereunder) applicable to any Real Property, or
any Environmental Claim asserted against the Borrower, any of its Subsidiaries
or any Real Property owned or at any time operated by the Borrower or any of its
Subsidiaries, including, in each case, without limitation, the reasonable fees
and disbursements of counsel and other consultants incurred in connection with
any such investigation, litigation or other proceeding (but excluding any
losses, liabilities, claims, damages or expenses to the extent incurred by
reason of the gross negligence, bad faith or willful misconduct of the Person to
be indemnified (as finally determined by a court of competent jurisdiction)).
To the extent that the undertaking to indemnify, pay or hold harmless the Agent
or any Bank set forth in the preceding sentence may be unenforceable because it
is violative of any law or public policy, the Borrower shall make the maximum
contribution to the payment and satisfaction of each of the indemnified
liabilities which is permissible under applicable law.
13.02 Right of Setoff. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence and during the continuance of an Event of
Default, each Bank is hereby authorized at any time or from time to time,
without presentment, demand, protest or other notice of any kind to any Credit
Party or to any other Person, any such notice being hereby expressly waived, to
set off and to appropriate and apply any and all deposits (general or special)
and any other Indebtedness at any time held or owing by such Bank (including,
without limitation, by branches and agencies of such Bank wherever located) to
or for the credit or the account of any Credit Party against and on account of
the Obligations and liabilities of the Credit Parties to such Bank under this
Agreement or under any of the other Credit Documents, including, without
limitation, all interests in Obligations purchased by such Bank pursuant to
Section 13.06(b), and all other claims of any nature or description arising out
of or connected with this Agreement or any other Credit Document, irrespective
of whether or not such Bank shall have made any demand hereunder and although
said Obligations, liabilities or claims, or any of them, shall be contingent or
unmatured.
13.03 Notices. Except as otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, telecopier or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered: if to any Credit Party,
at the address specified opposite its signature below or in the other relevant
Credit Documents; if to the Bank, at its address specified on Schedule II; and
if to the Agent, at its Notice Office; or, as to any Credit Party or the Agent,
at such other address as shall be designated by such party in a written notice
to the other parties hereto and, as to each Bank, at such other address as shall
be designated by such Bank in a written notice to the Borrower and the Agent.
All such notices and communications shall, when mailed, telegraphed, telexed,
telecopied, or cabled or sent by overnight courier, be effective when deposited
in the mails, delivered to the telegraph company, cable company or overnight
courier, as the case may be, or sent by telex or telecopier, except that notices
and communications to the Agent and the Borrower shall not be effective until
received by the Agent or the Borrower, as the case may be.
13.04 Benefit of Agreement; Assignments; Participations. (a) This
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the respective successors and assigns of the parties hereto; provided,
however, the Borrower may not assign or transfer any of its rights, obligations
or interest hereunder without the prior written consent of each of the Banks
and, provided further, that, although any Bank may transfer, assign or grant
participations in its rights hereunder, such Bank shall remain a "Bank" for all
purposes hereunder (and may not transfer or assign all or any portion of its
Commitments hereunder except as provided in Sections 1.13 and 13.04(b)) and the
transferee, assignee or participant, as the case may be, shall not constitute a
"Bank" hereunder and, provided further, that no Bank shall transfer or grant any
participation under which the participant shall have rights to approve any
amendment to or waiver of this Agreement or any other Credit Document except to
the extent such amendment or waiver would (i) extend the final scheduled
maturity of any Revolving Loan, Note or Letter of Credit (unless such Letter of
Credit is not extended beyond the Final Maturity Date) in which such participant
is participating, or reduce the rate or extend the time of payment of interest
or Fees thereon (except in connection with a waiver of applicability of any
post-default increase in interest rates) or reduce the principal amount thereof,
or increase the amount of the participant's participation over the amount
thereof then in effect (it being understood that a waiver of any Default or
Event of Default or of a mandatory reduction in the Total Revolving Loan
Commitment, shall not constitute a change in the terms of such participation,
and that an increase in any Revolving Loan Commitment or Revolving Loan shall be
permitted without the consent of any participant if the participant's
participation is not increased as a result thereof), (ii) consent to the
assignment or transfer by the Borrower of any of its rights and obligations
under this Agreement or (iii) release all or substantially all of the Pledge
Agreement Collateral (except as expressly provided in the Credit Documents)
supporting the Revolving Loans hereunder in which such participant is
participating. In the case of any such participation, the participant shall not
have any rights under this Agreement or any of the other Credit Documents (the
participant's rights against such Bank in respect of such participation to be
those set forth in the agreement executed by such Bank in favor of the
participant relating thereto) and all amounts payable by the Borrower hereunder
shall be determined as if such Bank had not sold such participation.
(b) Notwithstanding the foregoing, any Bank (or any Bank together
with one or more other Banks) may (x) assign all or a portion of its Revolving
Loan Commitment and related outstanding Obligations hereunder to (i) its parent
company and/or any affiliate of such Bank which is at least 50% owned by such
Bank or its parent company or to one or more Banks or (ii) in the case of any
Bank that is a fund that invests in bank loans, any other fund that invests in
bank loans and is managed by the same investment advisor of such Bank or by an
Affiliate of such investment advisor or (y) assign all, or if less than all, a
portion equal to at least $5,000,000 in the aggregate for the assigning Bank or
assigning Banks, of such Revolving Loan Commitment or Revolving Loan Commitments
and related outstanding Obligations hereunder to one or more Eligible
Transferees (treating any fund that invests in bank loans and any other fund
that invests in bank loans and is managed by the same investment advisor of such
fund or by an Affiliate of such investment advisor as a single Eligible
Transferee), each of which assignees shall become a party to this Agreement as a
Bank by execution of an Assignment and Assumption Agreement, provided that, (i)
at such time Schedule I shall be deemed modified to reflect the Revolving Loan
Commitments of such new Bank and of the existing Banks, (ii) upon the surrender
of the relevant Revolving Note by the assigning Bank (or, upon such assigning
Bank's indemnifying the Borrower for any lost Revolving Note pursuant to a
customary indemnification agreement) a new Revolving Note will be issued, at the
Borrower's expense, to such new Bank and to the assigning Bank upon the request
of such new Bank or assigning Bank, such new Revolving Note to be in conformity
with the requirements of Section 1.05 (with appropriate modifications) to the
extent needed to reflect the revised Revolving Loan Commitments and/or
outstanding Revolving Loans, as the case may be, (iii) the consent of the Agent
shall be required in connection with any assignment to an Eligible Transferee
pursuant to clause (y) above (which consent shall not be unreasonably withheld
or delayed), (iv) the Agent shall receive at the time of each such assignment,
from the assigning or assignee Bank, the payment of a non-refundable assignment
fee of $3,500 and (v) no such transfer or assignment will be effective until
recorded by the Agent on the Register pursuant to Section 13.15. To the extent
of any assignment pursuant to this Section 13.04(b), the assigning Bank shall be
relieved of its obligations hereunder with respect to its assigned Revolving
Loan Commitment and outstanding Revolving Loans. At the time of each assignment
pursuant to this Section 13.04(b) to a Person which is not already a Bank
hereunder and which is not a United States person (as such term is defined in
Section 7701(a)(30) of the Code) for Federal income tax purposes, the respective
assignee Bank shall, to the extent legally entitled to do so, provide to the
Borrower the appropriate Internal Revenue Service Forms (and, if applicable, a
Section 4.04(b)(ii) Certificate) described in Section 4.04(b). To the extent
that an assignment of all or any portion of a Bank's Revolving Loan Commitment
and related outstanding Obligations pursuant to Section 1.13 or this Section
13.04(b) would, at the time of such assignment, result in increased costs under
Section 1.10, 2.06 or 4.04 from those being charged by the respective assigning
Bank prior to such assignment, then the Borrower shall not be obligated to pay
such increased costs (although the Borrower, in accordance with and pursuant to
the other provisions of this Agreement, shall be obligated to pay any other
increased costs of the type described above resulting from changes after the
date of the respective assignment).
(c) Nothing in this Agreement shall prevent or prohibit any Bank from
pledging its Revolving Loans and Revolving Note hereunder to a Federal Reserve
Bank in support of borrowings made by such Bank from such Federal Reserve Bank
and, with the consent of the Agent, any Bank which is a fund may pledge all or
any portion of its Revolving Loans and Revolving Note to its trustee in support
of its obligations to its trustee. No pledge pursuant to this clause (c) shall
release the transferor Bank from any of its obligations hereunder.
13.05 No Waiver; Remedies Cumulative. No failure or delay on the
part of the Agent, the Collateral Agent, any Issuing Bank or any Bank in
exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between the Borrower or any other Credit Party
and the Agent, the Collateral Agent, any Issuing Bank or any Bank shall operate
as a waiver thereof; nor shall any single or partial exercise of any right,
power or privilege hereunder or under any other Credit Document preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege hereunder or thereunder. The rights, powers and remedies herein or in
any other Credit Document expressly provided are cumulative and not exclusive of
any rights, powers or remedies which the Agent, the Collateral Agent, any
Issuing Bank or any Bank would otherwise have. No notice to or demand on any
Credit Party in any case shall entitle any Credit Party to any other or further
notice or demand in similar or other circumstances or constitute a waiver of the
rights of the Agent, the Collateral Agent, any Issuing Bank or any Bank to any
other or further action in any circumstances without notice or demand.
13.06 Payments Pro Rata. (a) Except as otherwise provided in this
Agreement, the Agent agrees that promptly after its receipt of each payment from
or on behalf of the Borrower in respect of any Obligations hereunder, it shall
distribute such payment to the Banks (other than any Bank that has consented in
writing to waive its pro rata share of any such payment) pro rata based upon
their respective shares, if any, of the Obligations with respect to which such
payment was received.
(b) Each of the Banks agrees that, if it should receive any amount
hereunder (whether by voluntary payment, by realization upon security, by the
exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise), which is applicable to the payment of the principal of, or interest
on, the Revolving Loans, Unpaid Drawings, Commitment Commission or Letter of
Credit Fees, of a sum which with respect to the related sum or sums received by
other Banks is in a greater proportion than the total of such Obligation then
owed and due to such Bank bears to the total of such Obligation then owed and
due to all of the Banks immediately prior to such receipt, then such Bank
receiving such excess payment shall purchase for cash without recourse or
warranty from the other Banks an interest in the Obligations of the respective
Credit Party to such Banks in such amount as shall result in a proportional
participation by all the Banks in such amount; provided that if all or any
portion of such excess amount is thereafter recovered from such Bank, such
purchase shall be rescinded and the purchase price restored to the extent of
such recovery, but without interest.
(c) Notwithstanding anything to the contrary contained herein, the
provisions of the preceding Sections 13.06(a) and (b) shall be subject to the
express provisions of this Agreement which require, or permit, differing
payments to be made to Non-Defaulting Banks as opposed to Defaulting Banks.
13.07 Calculations; Computations; Accounting Terms. (a) The
financial statements to be furnished to the Banks pursuant hereto shall be made
and prepared in accordance with generally accepted accounting principles in the
United States consistently applied throughout the periods involved (except as
set forth in the notes thereto or as otherwise disclosed in writing by the
Borrower to the Banks); provided that, (i) except as otherwise specifically
provided herein, all computations and all definitions used in determining
compliance with Sections 9.07 through 9.10, inclusive, shall utilize accounting
principles and policies in conformity with those used to prepare the historical
financial statements of the Borrower referred to in Section 7.05(a) and (ii) the
aggregate Stated Amount of all Letters of Credit issued in support of Foreign
Subsidiary Third Party Borrowings (and the interest expense related to such
Letters of Credit) shall be excluded from the calculation of the financial
covenants set forth in Sections 9.08 and 9.09 and from the calculation of
Interest Reduction Discount to the extent, but only to the extent, of the
outstanding principal amount of such Foreign Subsidiary Third Party Borrowings
at the time of any such calculation.
(b) All computations of interest, Commitment Commission and other
Fees hereunder shall be made on the basis of a year of 360 days for the actual
number of days (including the first day but excluding the last day; except that
in the case of Letter of Credit Fees, the last day shall be included) occurring
in the period for which such interest, Commitment Commission or Fees are
payable.
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF
JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK. ANY LEGAL
ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT
MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES
FOR THE SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT, THE BORROWER HEREBY IRREVOCABLY ACCEPTS
FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE
JURISDICTION OF THE AFORESAID COURTS. THE BORROWER HEREBY FURTHER IRREVOCABLY
WAIVES ANY CLAIM THAT ANY SUCH COURTS LACK PERSONAL JURISDICTION OVER IT, AND
AGREES NOT TO PLEAD OR CLAIM, IN ANY LEGAL ACTION PROCEEDING WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENTS BROUGHT IN ANY OF THE
AFOREMENTIONED COURTS, THAT SUCH COURTS LACK PERSONAL JURISDICTION OVER IT. THE
BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF
THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF
COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO IT AT ITS
ADDRESS SET FORTH OPPOSITE ITS SIGNATURE BELOW, SUCH SERVICE TO BECOME EFFECTIVE
30 DAYS AFTER SUCH MAILING. THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION
TO SUCH SERVICE OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO
PLEAD OR CLAIM IN ANY ACTION OR PROCEEDING COMMENCED HEREUNDER OR UNDER ANY
OTHER CREDIT DOCUMENT THAT SERVICE OF PROCESS WAS IN ANY WAY INVALID OR
INEFFECTIVE. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE AGENT, ANY BANK OR
THE HOLDER OF ANY NOTE TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE BORROWER IN ANY
OTHER JURISDICTION.
(b) THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR
PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER
CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY
FURTHER IRREVOCABLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, WAIVES AND
AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING
OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
13.09 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
Agent.
13.10 Effectiveness. This Agreement shall become effective on the
date (the "Restatement Effective Date") on which (i) the Borrower, the Agent and
the Banks shall have signed a counterpart hereof (whether the same or different
counterparts) and shall have delivered the same to the Agent at the Notice
Office or, in the case of the Banks, shall have given to the Agent telephonic
(confirmed in writing), written or telex notice (actually received) at such
office that the same has been signed and mailed to it and (ii) the conditions
set forth in Section 5 are met to the satisfaction of the Agent and the Required
Banks. Unless the Agent has received actual notice from any Bank that the
conditions contained in Section 5 have not been met to its satisfaction, upon
the satisfaction of the condition described in clause (i) of the immediately
preceding sentence and upon the Agent's good faith determination that the
conditions described in clause (ii) of the immediately preceding sentence have
been met, then the Restatement Effective Date shall have been deemed to have
occurred, regardless of any subsequent determination that one or more of the
conditions thereto had not been met (although the occurrence of the Restatement
Effective Date shall not release the Borrower from any liability for failure to
satisfy one or more of the applicable conditions contained in Section 5). The
Agent will give the Borrower and each Bank prompt written notice of the
occurrence of the Restatement Effective Date.
13.11 Headings Descriptive. The headings of the several sections and
subsections of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.
13.12 Amendment or Waiver; etc. (a) Neither this Agreement nor any
other Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by the respective Credit Parties party thereto and the
Required Banks, provided that no such change, waiver, discharge or termination
shall, without the consent of each Bank (other than a Defaulting Bank), (i)
extend the final scheduled maturity of any Loan or Note or extend the stated
expiration date of any Letter of Credit beyond the Final Maturity Date, or
reduce the rate or extend the time of payment of interest or Fees thereon, or
reduce the principal amount thereof (except to the extent repaid in cash) (it
being understood that any amendment or modification to the financial definitions
in this Agreement or to Section 13.07(a) shall not constitute a reduction in the
rate of interest or Fees for the purposes of this clause (i)), (ii) release all
or substantially all of the Collateral (except as expressly provided in the
Credit Documents), (iii) amend, modify or waive any provision of this Section
13.12, (iv) reduce the percentage specified in the definition of Required Banks
(it being understood that, with the consent of the Required Banks, additional
extensions of credit pursuant to this Agreement may be included in the
determination of the Required Banks on substantially the same basis as the
Revolving Loan Commitments are included on the Effective Date) or (v) consent to
the assignment or transfer by the Borrower of any of its rights and obligations
under this Agreement; provided further, that no such change, waiver, discharge
or termination shall (v) increase the Revolving Loan Commitment of any Bank over
the amount thereof then in effect without the consent of such Bank (it being
understood that waivers or modifications of conditions precedent, covenants,
Defaults or Events of Default or of a mandatory reduction in the Total Revolving
Loan Commitment shall not constitute an increase of the Revolving Loan
Commitment of any Bank, and that an increase in the available portion of any
Revolving Loan Commitment of any Bank shall not constitute an increase of the
Revolving Loan Commitment of such Bank), (w) without the consent of any Issuing
Bank, amend, modify or waive any provision of Section 2 or alter its rights or
obligations with respect to Letters of Credit, (x) without the consent of the
Swingline Bank, alter the Swingline Bank's rights or obligations with respect to
Swingline Loans, (y) without the consent of the Agent, amend, modify or waive
any provision of Section 12 or any other provision as same relates to the rights
or obligations of the Agent, or (z) without the consent of the Collateral Agent,
amend, modify or waive any provision relating to the rights or obligations of
the Collateral Agent.
(b) If, in connection with any proposed change, waiver, discharge or
termination to any of the provisions of this Agreement as contemplated by
clauses (i) through (v), inclusive, of the first proviso to Section 13.12(a),
the consent of the Required Banks is obtained but the consent of one or more of
such other Banks whose consent is required is not obtained, then the Borrower
shall have the right, so long as all non-consenting Banks whose individual
consent is required are treated as described in either clauses (A) or (B) below,
to either (A) replace each such non-consenting Bank or Banks with one or more
Replacement Banks pursuant to Section 1.13 so long as at the time of such
replacement, each such Replacement Bank consents to the proposed change, waiver,
discharge or termination or (B) terminate such non-consenting Bank's Revolving
Loan Commitment and/or repay the outstanding Revolving Loans of such Bank and
cash collateralize its applicable RL Percentage of the Letter of Credit
Outstandings in accordance with Sections 3.02(b) and 4.01(b), provided that,
unless the Revolving Loan Commitment that is terminated, and Revolving Loans
repaid, pursuant to preceding clause (B) are immediately replaced in full at
such time through the addition of new Banks or the increase of the Revolving
Loan Commitments and/or outstanding Revolving Loans of existing Banks (who in
each case must specifically consent thereto), then in the case of any action
pursuant to preceding clause (B) the Required Banks (determined after giving
effect to the proposed action) shall specifically consent thereto, provided
further, that in any event the Borrower shall not have the right to replace a
Bank, terminate its Revolving Loan Commitment or repay its Revolving Loans
solely as a result of the exercise of such Bank's rights (and the withholding of
any required consent by such Bank) pursuant to the second proviso to Section
13.12(a).
13.13 Survival. All indemnities set forth herein including, without
limitation, in Sections 1.10, 1.11, 2.06, 4.04, 12.06 and 13.01 shall survive
the execution, delivery and termination of this Agreement and the Notes and the
making and repayment of the Obligations.
13.14 Domicile of Loans. Each Bank may transfer and carry its Loans
at, to or for the account of any office, Subsidiary or Affiliate of such Bank.
Notwithstanding anything to the contrary contained herein, to the extent that a
transfer of Loans pursuant to this Section 13.14 would, at the time of such
transfer, result in increased costs under Section 1.10, 1.11, 2.06 or 4.04 from
those being charged by the respective Bank prior to such transfer, then the
Borrower shall not be obligated to pay such increased costs (although the
Borrower shall be obligated to pay any other increased costs of the type
described above resulting from changes after the date of the respective
transfer).
13.15 Register. The Borrower hereby designates the Agent to serve as
the Borrower's agent, solely for purposes of this Section 13.15, to maintain a
register (the "Register") on which it will record the Revolving Loan Commitments
from time to time of each of the Banks, the Revolving Loans made by each of the
Banks and each repayment in respect of the principal amount of the Revolving
Loans of each Bank. Failure to make any such recordation, or any error in such
recordation shall not affect the Borrower's obligations in respect of such
Revolving Loans. With respect to any Bank, the transfer of the Revolving Loan
Commitment of such Bank and the rights to the principal of, and interest on, any
Revolving Loan made pursuant to such Revolving Loan Commitment shall not be
effective until such transfer is recorded on the Register maintained by the
Agent with respect to ownership of such Revolving Loan Commitment and Revolving
Loans and prior to such recordation all amounts owing to the transferor with
respect to such Revolving Loan Commitment and Revolving Loans shall remain owing
to the transferor. The registration of assignment or transfer of all or part of
any Revolving Loan Commitments and Revolving Loans shall be recorded by the
Agent on the Register only upon the acceptance by the Agent of a properly
executed and delivered Assignment and Assumption Agreement pursuant to Section
13.04(b). Coincident with the delivery of such an Assignment and Assumption
Agreement to the Agent for acceptance and registration of assignment or transfer
of all or part of a Revolving Loan, or as soon thereafter as practicable, the
assigning or transferor Bank shall surrender the Revolving Note evidencing such
Revolving Loan, and thereupon one or more new Revolving Notes in the same aggre
gate principal amount shall be issued to the assigning or transferor Bank and/or
the new Bank. The Borrower agrees to indemnify the Agent from and against any
and all losses, claims, damages and liabilities of whatsoever nature which may
be imposed on, asserted against or incurred by the Agent in performing its
duties under this Section 13.15.
13.16 Confidentiality. (a) Subject to the provisions of clause (b)
of this Section 13.16, each Bank agrees that it will use its reasonable efforts
not to disclose without the prior consent of the Borrower (other than to its
employees, auditors, advisors or counsel or to another Bank if the Bank or such
Bank's holding or parent company in its sole discretion determines that any such
party should have access to such information, provided such Persons shall be
subject to the provisions of this Section 13.16 to the same extent as such Bank)
any information with respect to the Borrower or any of its Subsidiaries which is
now or in the future furnished pursuant to this Agreement or any other Credit
Document and which is designated by the Borrower to the Banks in writing as
confidential, provided that any Bank may disclose any such information (i) as
has become generally available to the public other than by virtue of a breach of
this Section 13.16(a) by the respective Bank, (ii) as may be required or
appropriate in any report, statement or testimony submitted to any municipal,
state or Federal regulatory body having or claiming to have jurisdiction over
such Bank or to the Federal Reserve Board or the Federal Deposit Insurance
Corporation or similar organizations (whether in the United States or elsewhere)
or their successors, (iii) as may be required or appropriate in respect to any
summons or subpoena or in connection with any litigation, (iv) in order to
comply with any law, order, regulation or ruling applicable to such Bank, (v) to
the Agent or the Collateral Agent and (vi) to any prospective or actual
transferee or participant in connection with any contemplated transfer or
participation of any of the Revolving Notes or Revolving Loan Commitments or any
interest therein by such Bank, provided that such prospective transferee or
participant agrees to be bound by the confidentiality provisions contained in
this Section 13.16.
(b) The Borrower hereby acknowledges and agrees that each Bank may
share with any of its affiliates any information related to the Borrower or any
of its Subsidiaries (including, without limitation, any nonpublic customer
information regarding the creditworthiness of the Borrower and its
Subsidiaries), provided such Persons shall be subject to the provisions of this
Section 13.16 to the same extent as such Bank.
13.17 Judgment Currency. (a) The Borrower's obligation hereunder
and under the other Credit Documents to make payments in Dollars or, in the case
of Letters of Credit denominated in a currency other than Dollars, in such other
currency (in either such case, the "Obligation Currency") shall not be
discharged or satisfied by any tender or recovery pursuant to any judgment
expressed in or converted into any currency other than the Obligation Currency,
except to the extent that such tender or recovery results in the effective
receipt by the Agent, the Collateral Agent or the respective Bank of the full
amount of the Obligation Currency expressed to be payable to the Agent, the
Collateral Agent or such Bank under this Agreement or the other Credit
Documents. If for the purpose of obtaining or enforcing judgment against the
Borrower in any court or in any jurisdiction, it becomes necessary to convert
into or from any currency other than the Obligation Currency (such other
currency being hereinafter referred to as the "Judgment Currency") an amount due
in the Obligation Currency, the conversion shall be made, at the Dollar
Equivalent thereof, in the case of conversions into Dollars or, in the case of
conversions into a currency other than Dollars, at the rate of exchange quoted
by the Agent, determined, in each case, as of the date immediately preceding the
day on which the judgment is given (such Business Day being hereinafter referred
to as the "Judgment Currency Conversion Date").
(b) If there is a change in the rate of exchange prevailing between
the Judgment Currency Conversion Date and the date of actual payment of the
amount due, the Borrower convenants and agrees to pay, or cause to be paid, such
additional amounts, if any (but in any event not a lesser amount) as may be
necessary to ensure that the amount paid in the Judgment Currency, when
converted at the rate of exchange prevailing on the date of payment, will
produce the amount of the Obligation Currency which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial
award at the rate of exchange prevailing on the Judgment Currency Conversion
Date.
(c) For purposes of determining the Dollar Equivalent or any other
rate of exchange for this Section 13.17, such amounts shall include any premium
and costs payable in connection with the purchase of the Obligation Currency.
13.18 Miscellaneous. On the Restatement Effective Date and after
giving effect to the repayment of outstanding Original Revolving Loans on such
date as required by Section 5.05(a), the Banks shall, in coordination with the
Agent, effect interBank wire transfers to the extent necessary to ensure that
the Banks continue to participate in each Borrowing of Revolving Loans on the
Restatement Effective Date pro rata based on their Revolving Loan Commitments.
* * *
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
Address:
300 East Lombard Street SITEL CORPORATION
Suite 850
Baltimore, Maryland 21202
Telephone: (410) 659-5700
Telecopier: (410) 659-5754 By: ______________________
Attention: Phillip A. Clough
President
BANKERS TRUST COMPANY,
Individually and as Agent
By: __________________________________
Title:
U.S. BANK NATIONAL ASSOCIATION,
Individually, and as Syndication Agent
By: __________________________________
Title:
FIRST UNION NATIONAL BANK,
Individually, and as Documentation Agent
By: __________________________________
Title:
THE BANK OF NEW YORK
By: __________________________________
Title:
THE BANK OF NOVA SCOTIA
By: __________________________________
Title:
COMERICA BANK
By: __________________________________
Title:
CREDIT AGRICOLE INDOSUEZ
By: __________________________________
Title:
THE FIRST NATIONAL BANK OF CHICAGO
By: __________________________________
Title:
WACHOVIA BANK, N.A.
By: __________________________________
Title:
SCHEDULE I
__________
REVOLVING LOAN COMMITMENTS
___________________________
Revolving Loan
Bank Commitment
____ __________
Bankers Trust Company $10,000,000
U.S. Bank National Association $10,000,000
First Union National Bank $10,000,000
The Bank of New York $9,000,000
The First National Bank of Chicago $9,000,000
Comerica Bank $7,000,000
Credit Agricole Indusuez $7,000,000
The Bank of Nova Scotia $7,000,000
Wachovia Bank, N.A. $6,000,000
__________
TOTAL: $75,000,000.00
=============
<PAGE>
SCHEDULE II
___________
BANK ADDRESSES
______________
Bank Address
____ _______
Bankers Trust Company 130 Liberty Street
New York, NY 10006
Attn: David Bell
Tel. No.: (212) 250-9048
Fax No.: (212) 250-7218
U.S. Bank National Association 601 Second Avenue South
Minneapolis, MN 55402
Attn: David Drexler
Tel. No.: (612) 973-0539
Fax No.: (612) 973-0824
First Union National Bank 301 South College Street, DC5
NC 0737
Charlotte, NC 28288-0737
Attn: Henry R. Biedrzycki
Tel. No.: (704) 374-4914
Fax No.: (704) 374-3300
The Bank of New York One Wall Street
New York, NY 10286
Attn: Bill O'Daley
Tel. No.: (212) 635-1147
Fax No.: (212) 635-1208
The Bank of Nova Scotia 180 West Madison, Suite 3700
Chicago, IL 60602
Attn: Keith Rauschenberger
Tel. No.: (312) 201-4183
Fax No.: (312) 201-4108
Comerica Bank 500 Woodward Avenue, MC 3269
Detroit, MI 48226
Attn: Phillip A. Coosaia
Tel. No.: (313) 222-7044
Fax No.: (313) 222-9516
<PAGE>
Credit Agricole Indosuez 55 East Monroe Street
Chicago IL 60603
Attn: Jerome LeBlond
Tel. No.: (312) 372-9200
Fax No.: (312) 372-3724
The First National Bank of One First National Plaza
Chicago Mail Suite 0173
14th Floor
Chicago, IL 60670-0173
Attn: Nathan Bloch
Tel. No.: (312) 732-2243
Fax No.: (312) 732-1117
Wachovia Bank, N.A. 191 Peachtree Street, N.E.
Atlanta, GA 30303
Attn: Mark Thomas
Tel. No.: (404) 332-6450
Fax No.: (404) 332-6898
<PAGE>
SCHEDULE III
____________
SUBSIDIARIES
____________
(all 100% owned unless otherwise indicated)
SITEL International, Inc.
(Asia Pacific)(1)
- SITEL Asia Pacific Investments Pte Limited fka SITEL Asia Pacific
Holdings Pte Ltd.
- SITEL Asia Pacific Pte Limited (80%) fka Evergreen
Investments Pte Limited
- SITEL Singapore Pte Ltd.
- SITEL Japan KK
- SITEL Hong Kong Pte Ltd.
- SITEL Australia Pty Ltd. (80%) fka SITEL Levita Pty Ltd.
- SITEL Australia Holdings Pty Ltd. fka SITEL Australia Pty
Ltd.
- SITEL Telebusiness New Zealand Limited
- SITEL Telebusiness Australia Pty Limited
- SITEL Telebusiness Singapore Pte Ltd.
(Canada)
- SITEL Teleservices Canada Inc.
(Europe)
- SITEL Europe plc
- SITEL UK Limited
- SITEL Stratford [Services] Limited
- SITEL Kingston [Services]Limited
- SITEL Moor Park [Services] Limited
- SITEL Stratford Limited
- SITEL Kingston Limited
- SITEL Moor Park Limited
- B's Telemarketing Limited
- The L & R Group Limited
- Leiderman and Roncoroni Limited
- The Trading Works Limited
- SITEL Belgium NV fka SITEL Brussels NV
- SITEL GmbH
- SITEL Nordics AB fka Svanberg & Co. Intressenter AB
- Svanberg & Co AB
- Worldwide Sweden AB
- SITEL TMS Limited fka Telephone Marketing Services (Ireland)
Ltd
<FN1> These subsidiaries reflect the changes made or being made in connection
with the closing with Lend Lease.
<PAGE>
- Telephone Marketing Services (International) Limited
- SITEL Hispanica, S.A.
- SITEL Iberica Teleservices, S.A.
- Action Data Base S.A. fka Teleaction Data Base S.A.
- Telepromotion S.A. (75%)
- Moma Pars S.L.
- Triana 24 SL
- Action Servicos de Publicidade S.A.
(Latin America)
- Grupo SITEL de Mexico, S.A. de C.V. (49%)
- GCI Colobmia, S.A. (94%)
SITEL Technical Services, Inc.
SITEL Insurance Services, Inc.
Financial Insurance Services, Inc.
SITEL Support Services, Inc.
National Action Financial Services, Inc.
SITEL Software, Inc.
SITEL Investments, Inc.
SITEL Insurance Marketing Services, Inc.
Companies listed at the left margin are directly-owned Subsidiaries of the
Borrower. The Borrower also owns one share of SITEL Europe plc with the rest of
the shares owned by SITEL International, Inc. Below each directly-owned
Subsidiary of the Borrower is a list of Subsidiaries which are directly-owned by
such directly-owned Subsidiaries of the Borrower. The indirectly-owned
Subsidiaries of the directly-owned Subsidiaries of the Borrower are listed in a
similar manner.
SCHEDULE IV
EXISTING INDEBTEDNESS
Bank/
Borrower Counterparty Facility Type Purpose Maturity Balance(1)
____________ ____________ _____________ ____________ ________ ________
BANK
DEBT
SITEL Europe Royal Bank Overdrafts Operations n/a $6,604,000
of Scotland
SITEL Royal Bank Overdrafts Operations n/a $1,631,000
Stratford of Scotland
L&R Barclays Overdrafts Operations n/a $18,000
Bank
SITEL Credit Revolving Operations n/a $864,000
Belgium Lyonnais Credit
SITEL Credite Bank Revolving Operations n/a $280,000
Belgium Credit
SITEL BBL Revolving Operations n/a $270,000
Belgium Credit
SITEL Generale Revolving Operations n/a $1,316,000
Belgium Bank Credit
SITEL GmbH Commerzbank Revolving Operations n/a $362,000
Credit
SITEL GmBh Dresdner Revolving Operations n/a $581,000
Bank Credit
SITEL Various Poliza de Operations 6/30/98 $3,999,000
Iberica Spanish credito
Teleservices Banks
Levita National Construction American 3/31/01 $3,948,000
(SITEL Asia Australia Loan Express Call
Pacific) Bank Centre
LONG TERM
DEBT
SITEL South Dakota Installment Economic 3/2/00 $116,000
Corporation Loan Development
Loan
SITEL Oracle Installment Software 12/31/99 $2,811,374
Corporation Corporation Loan Purchase
SITEL IBM Installment Equipment 6/4/99 $1,506,569
Corporation Loan Loan
SITEL Generale Belgacom Secured on n/a $146,000
Belgium Bank Finance Debts
SITEL Generale MSN Finance Secured on n/a $90,000
Belgium Bank Debts
SITEL Generale Mercom Secured on n/a $192,000
Belgium Bank Finance Debts
SITEL Latin Various Equipment Equipment 3/31/98 $1,279,559
America Notes Financing
SITEL Latin Various Equipment Equipment 11/30/98 $2,544,441
America Notes Financing
CAPITAL
LEASES
National Various Lease Equipment 9/30/00 $237,943
Action Vendors Leases
Financial
Services
SITEL Various Lease Acquisition 11/30/99 $636,114
Corporation Vendors Equipment
Leases
SITEL Various Lease Equipment 3/31/00 $2,481,000
Iberica Vendors Leases
Teleservices
SITEL Europe Various Lease Phone 2/28/01 $12,009,00
Vendors Equipment 0
Leases
Telebusiness Various Lease Equipment 6/30/00 $1,845,000
Australia Vendors Leases __________
SITEL Asia Various Lease Equipment 9/30/99 $462,000
Pacific Vendors Leases
SITEL Asia Various Lease Equipment 12/31/99 $281,000
Pacific Vendors Leases
__________
Total $ 46,090,593
==========
<FN1> All balances as of 12/31/97, and there are no material differences between
12/31/97 and the Restatement Effective Date.
<PAGE>
EXISTING LIENS
______________
<TABLE>
<CAPTION>
Filing Secured File Original Description Permitted
Location Debtor Party Number(1) File Date of Collateral Refinancing
________ ___________ ___________ ___________ _________ ____________ ___________
<S> <C> <C> <C> <C> <C> <C>
CO SITEL IBM Credit 19972048421 6/12/97 IBM equipment Yes
Corporation Corp.
CO SITEL Business 942050037 7/5/94 Canon Copier & Yes
Corporation Equipment Stapler/Sorter
Leasing Co.
NE SITEL Business 9991527333 9/3/91 Sharp Yes
Corporation Leasing, copier/collator
Inc.
NE SITEL Pitney 9992562228 9/8/92 leased equipment, Yes
Corporation Bowes products &
Credit proceeds
Corporation
NE SITEL Northern 9992562700 9/14/92 leased computer Yes
Corporation Telecom equipment,
Finance products &
Corp. proceeds
NE SITEL Pitney 9992568233 11/16/92 leased equipment, Yes
Corporation Bowes products &
Credit proceeds
Corporation
NE SITEL Norwest 9993583083 4/13/93 leased equipment Yes
Corporation Bank NE
NE SITEL Pitney 9994627061 7/5/94 leased equipment, Yes
Corporation Bowes inventory,
Credit products &
Corporation proceeds
NE SITEL Eakes 9995653206 4/10/95 Sharp office Yes
Corporation Office equipment
Products
NE SITEL Pitney 9995660502 6/21/95 leased equipment, Yes
Corporation Bowes products &
Credit proceeds
Corporation
NE SITEL Pitney 9995660504 6/21/95 leased equipment Yes
Corporation Bowes & products
Credit
Corporation
NE SITEL Eakes 9995670855 10/17/95 Sharp office Yes
Corporation Office equipment
Products
NE SITEL Douglas 9995671643 10/25/95 Canon copiers, Yes
Corporation County Bank staplers,
& Trust sorters, products
& proceeds
NE SITEL Pitney 9996685039 3/11/96 leased equipment, Yes
Corporation Bowes products &
Credit proceeds
Corporation
NE SITEL Pitney 9996694626 6/3/96 leased equipment, Yes
Corporation Bowes products &
Credit proceeds
Corporation
NE SITEL Business 9996697544 7/1/96 leased office Yes
Corporation Credit equipment
Leas.
NE SITEL Douglas Co. 9996702389 8/21/96 Canon copiers, Yes
Corporation Bank & staplers, sorter,
Trust equipment,
products &
proceeds
NE SITEL Pitney 9996707775 10/11/96 leased equipment, Yes
Corporation Bowes products &
Credit proceeds
Corporation
NE SITEL Pitney 999670776 10/11/96 leased equipment, Yes
Corporation Bowes products &
Credit proceeds
Corporation
NE SITEL Business 9997724038 3/10/97 copier & office Yes
Corporation Credit equipment
Leas.
NE SITEL IBM 9997735431 6/12/97 IBM equipment Yes
Corporation Corporation
TX SITEL American 95- 4/26/95 Canon copier, Yes
Corporation Nat'l Bank 00082117 stapler, sorter
TX SITEL IBM Credit 97- 6/12/97 IBM equipment Yes
Corporation Corp. 00122818
TX SITEL IBM Credit 97- 6/12/97 IBM equipment Yes
Corporation Corp. 00122819
WI SITEL PNC Leasing 1655525 3/14/97 finance lease, Yes
Technical Corp. equipment
Services,
Inc.
WI SITEL PNC Leasing 1655526 3/14/97 finance lease, Yes
Technical Corp. equipment
Services,
Inc.
WI SITEL PNC Leasing 1655527 3/14/97 finance lease, Yes
Technical Corp. equipment
Services,
Inc.
NY National AT&T Credit 199509 10/3/95 AT&T Definity Yes
Action Corp. Generic lease
Financial
Services,
Inc.
GA National AT&T 9404228 6/10/94 Equipment Lease Yes
(DeKalb Action Capital
County) Financial Corporation
Services,
Inc.
GA National Eaton 9404515 6/20/94 Equipment Lease Yes
(DeKalb Action Financial
County) Financial Corporation
Services,
Inc.
GA National American 007858 8/21/95 Equipment Lease Yes
(DeKalb Action Business (computer
County) Financial Credit equipment)
Services, Corporation
Inc.
GA National AT&T Credit 07031 4/24/95 Equipment Lease Yes
(Fulton Action Corporation (Definity G3S)
County) Financial
Services,
Inc.
GA National Provident 08824 5/16/95 Equipment Lease Yes
(Fulton Action Capital (voice mail
County) Financial Group, Inc. system)
Services,
Inc.
NE SITEL Pitney 9997747067 10/14/97 Equipment Lease; Yes
Corporation Bowes Proceeds/
Credit Collateral, Other
Corporation
NE SITEL Sharp 9997755259 12/08/97 Sharp Copier & Yes
Corporation Electronic 1 Fax; Equipment
Credit Co.
NE SITEL, PNC Leasing 9997725210 3/18/97 Finance Lease; Yes
Technical Corp. Equipment
Services, Proceeds/
inc. Collateral
NE SITEL, PNC Leasing 9997725212 3/18/97 Finance Lease; Yes
Technical Corp. Equipment
Services, Proceeds/
Inc. Collateral
Also, (i) the capital leases for the various Foreign Subsidiaries as set
forth on Schedule IV and (ii) any Foreign Subsidiary Third Party Borrowings
set forth on Schedule IV.
NOTE: The line of credit giving rise to the following expired before July 1997
but the financing statements have not been terminated at the filing office. We
are obtaining and filing UCC Termination Statements for these.
GA National First Union 9404403 6/16/94 Fixtures NO
(DeKalb Action National
County) Financial bank of
Services, Georgia
Inc.
GA National First Union 005489 6/19/95 Accounts NO
(DeKalb Action National Receivables/
County) Financial Bank of Contract
Services, Georgia Rights/General
Inc. Intangibles
GA National First Union 001472 2/12/96 Amendment #005489 NO
(DeKalb Action National Accounts
County) Financial Bank of Receivable/
Services, Georgia Contract
Inc. Rights/General
Intangibles/
Equipment/Fixture
/Proceeds
<FN1> Includes renewals, replacements and extensions of such liens in accordance
with Section 9.01(iii).
</TABLE>
<PAGE>
SCHEDULE VI
___________
SALE/LEASEBACK PROPERTIES
_________________________
1) 7303 World Communications Drive
Omaha, Nebraska 68122
2) 5807 North 102nd
Omaha, Nebraska 68134
3) 5601 North 103rd
Omaha, Nebraska 68134
4) 2702 West Loop 306
San Angelo, Texas 76904
<PAGE>
SCHEDULE VII
____________
EXISTING INVESTMENTS
____________________
490 shares of SITEL Insurance Services Canada Inc. common stock (49%)
38.6% of Software Associates (Asia) Ltd. held by SITEL Asia Pacific Investments
Pte Limited
38.6% of Software Associates (NSW) pty Ltd. held by SITEL Asia Pacific
Investments Pte Limited
38.6% of International Research pty Ltd. Held by SITEL Asia Pacific Investments
Pte Limited
<PAGE>
SCHEDULE VIII
____________
EXISTING LETTERS OF CREDIT
___________________________
Borrower Bank Beneficiary Expiry Date Currency Balance (1)
_______ ____ ___________ ___________ ________ __________
SITEL U.S. Bank State of 2/28/98 USD 128,000
Corporation N.A. South Dakota
SITEL U.S. Bank National 9/10/98 USD 3,200,000
Corporation N.A. Australia
Bank
<FN1>Balances as of 12/31/97.
<PAGE>
TABLE OF CONTENTS
_________________
Page
____
SECTION 1. Amount and Terms of Credit........................ 1
1.01 The Commitments.................................... 1
1.02 Minimum Amount of Each Borrowing................... 3
1.03 Notice of Borrowing................................ 3
1.04 Disbursement of Funds.............................. 4
1.05 Notes.............................................. 5
1.06 Conversions........................................ 5
1.07 Pro Rata Borrowings................................ 6
1.08 Interest........................................... 6
1.09 Interest Periods................................... 7
1.10 Increased Costs, Illegality, etc................... 8
1.11 Compensation....................................... 10
1.12 Change of Lending Office........................... 10
1.13 Replacement of Banks............................... 10
SECTION 2. Letters of Credit................................ 11
2.01 Letters of Credit................................. 11
2.02 Maximum Letter of Credit Outstandings;
Final Maturities.................................. 12
2.03 Letter of Credit Requests; Minimum Stated Amount.. 12
2.04 Letter of Credit Participations................... 13
2.05 Agreement to Repay Letter of Credit Drawings...... 15
2.06 Increased Costs................................... 16
SECTION 3. Commitment Commission; Fees; Reductions of
Commitment....................................... 17
3.01 Fees.............................................. 17
3.02 Voluntary Termination of Unutilized Commitments... 18
3.03 Mandatory Reduction of Commitments................ 18
SECTION 4. Prepayments; Payments; Taxes..................... 19
4.01 Voluntary Prepayments............................. 19
4.02 Mandatory Repayments.............................. 20
4.03 Method and Place of Payment....................... 21
4.04 Net Payments...................................... 22
SECTION 5. Conditions Precedent to the Restatement Effective
Date............................................. 23
5.01 Execution of Agreement; Notes..................... 23
5.02 Officer's Certificate............................. 24
5.03 Opinions of Counsel............................... 24
5.04 Corporate Documents; Proceedings; etc............. 24
5.05 Senior Subordinated Notes; etc.................... 24
5.06 Adverse Change, etc............................... 25
5.07 Litigation........................................ 25
5.08 Pledge Agreement.................................. 25
5.09 Security Agreement................................ 26
5.10 Subsidiaries Guaranty............................. 26
5.11 Financial Statements; Pro Forma Balance Sheet;
Projections....................................... 26
5.12 Solvency Certificate.............................. 26
5.13 Initial Borrowing Base Certificate................ 26
5.14 Fees, etc......................................... 26
SECTION 6. Conditions Precedent to All Credit Events........ 27
6.01 Restatement Effective Date........................ 27
6.02 No Default; Representations and Warranties........ 27
6.03 Notice of Borrowing; Letter of Credit Request..... 27
SECTION 7. Representations, Warranties and Agreements....... 27
7.01 Corporate Status.................................. 28
7.02 Corporate and Other Power and Authority........... 28
7.03 No Violation...................................... 28
7.04 Approvals......................................... 29
7.05 Financial Statements; Financial Condition; Undisclosed
Liabilities; Projections; etc..................... 29
7.06 Litigation........................................ 30
7.07 True and Complete Disclosure...................... 30
7.08 Use of Proceeds; Margin Regulations............... 30
7.09 Tax Returns and Payments.......................... 31
7.10 Compliance with ERISA............................. 31
7.11 The Security Documents............................ 32
7.12 Properties........................................ 33
7.13 Capitalization.................................... 33
7.14 Subsidiaries...................................... 33
7.15 Compliance with Statutes, etc..................... 33
7.16 Investment Company Act............................ 33
7.17 Public Utility Holding Company Act................ 33
7.18 Environmental Matters............................. 33
7.19 Labor Relations................................... 34
7.20 Patents, Licenses, Franchises and Formulas........ 35
7.21 Indebtedness...................................... 35
7.22 Senior Subordinated Notes......................... 35
SECTION 8. Affirmative Covenants............................ 35
8.01 Information Covenants............................. 35
8.02 Books, Records and Inspections; Annual Meetings... 38
8.03 Maintenance of Property; Insurance................ 38
8.04 Corporate Franchises.............................. 39
8.05 Compliance with Statutes, etc..................... 39
8.06 Compliance with Environmental Laws................ 39
8.07 ERISA............................................. 39
8.08 End of Fiscal Years; Fiscal Quarters.............. 40
8.09 Performance of Obligations........................ 40
8.10 Payment of Taxes.................................. 41
8.11 Pledge of Foreign Subsidiaries Stock.............. 41
8.12 Margin Stock...................................... 41
SECTION 9. Negative Covenants............................... 41
9.01 Liens............................................. 41
9.02 Consolidation, Merger, Purchase or Sale of Assets,
etc............................................... 44
9.03 Restricted Payment................................ 47
9.05 Advances, Investments and Loans................... 49
9.06 Transactions with Affiliates...................... 51
9.08 Consolidated Interest Coverage Ratio.............. 53
9.09 Maximum Leverage Ratio............................ 54
9.10 Minimum Consolidated EBITDA....................... 54
9.11 Limitation on Modifications of Certificate of
Incorporation, By-Laws, SAP Joint Venture Documents
and Senior Subordinated Note Documents; etc....... 54
9.12 Limitation on Certain Restrictions on Subsidiaries 55
9.13 Limitation on Issuance of Capital Stock........... 55
9.14 Business.......................................... 55
9.15 Limitation on Creation of Subsidiaries............ 55
9.16 SAP Joint Venture Arrangements.................... 56
SECTION 10. Events of Default............................... 56
10.01 Payments......................................... 56
10.02 Representations, etc............................. 56
10.03 Covenants........................................ 56
10.04 Default Under Other Agreements................... 57
10.05 Bankruptcy, etc.................................. 57
10.06 ERISA............................................ 57
10.07 Security Documents............................... 58
10.08 Subsidiaries Guaranty............................ 58
10.09 Judgments........................................ 58
10.10 Change of Control................................ 58
SECTION 11. Definitions and Accounting Terms................ 59
11.01 Defined Terms.................................... 59
SECTION 12. The Agent....................................... 78
12.01 Appointment...................................... 78
12.02 Nature of Duties................................. 78
12.03 Lack of Reliance on the Agent.................... 78
12.04 Certain Rights of the Agent...................... 79
12.05 Reliance......................................... 79
12.06 Indemnification.................................. 79
12.07 The Agent in its Individual Capacity............. 79
12.08 Holders.......................................... 80
12.09 Resignation by the Agent......................... 80
12.10 Syndication Agent and Documentation Agent........ 80
SECTION 13. Miscellaneous................................... 80
13.01 Payment of Expenses, etc......................... 80
13.02 Right of Setoff.................................. 81
13.03 Notices.......................................... 82
13.04 Benefit of Agreement; Assignments; Participations 82
13.05 No Waiver; Remedies Cumulative................... 84
13.06 Payments Pro Rata................................ 84
13.07 Calculations; Computations; Accounting Terms..... 85
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE;
WAIVER OF JURY TRIAL............................. 85
13.09 Counterparts..................................... 86
13.10 Effectiveness.................................... 86
13.11 Headings Descriptive............................. 87
13.12 Amendment or Waiver; etc......................... 87
13.13 Survival......................................... 88
13.14 Domicile of Loans................................ 88
13.15 Register......................................... 88
13.16 Confidentiality.................................. 89
13.17 Judgment Currency................................ 89
13.18 Miscellaneous.................................... 90
SCHEDULE I Commitments
SCHEDULE II Bank Addresses
SCHEDULE III Subsidiaries
SCHEDULE IV Existing Indebtedness
SCHEDULE V Existing Liens
SCHEDULE VI Specified Sale/Leaseback Properties
SCHEDULE VII Existing Investments
SCHEDULE VIII Existing Letters of Credit
EXHIBIT A Notice of Borrowing
EXHIBIT B-1 Revolving Note
EXHIBIT B-2 Swingline Note
EXHIBIT C Letter of Credit Request
EXHIBIT D Section 4.04(b)(ii) Certificate
EXHIBIT E-1 Opinion of Abrahams Kaslow & Cassman,
Special Counsel to the Credit Parties
EXHIBIT E-2 Opinion of the Corporate Counsel of the Borrower
EXHIBIT F Officers' Certificate
EXHIBIT G Pledge Agreement
EXHIBIT H Security Agreement
EXHIBIT I Subsidiaries Guaranty
EXHIBIT J Solvency Certificate
EXHIBIT K Borrowing Base Certificate
EXHIBIT L Assignment and Assumption Agreement
EXHIBIT M Intercompany Note
EXHIBIT N Subordination Provisions
<PAGE>
================================================================================
SITEL CORPORATION,
as Company,
each of the Subsidiary Guarantors named herein
and
The First National Bank of Maryland,
as Trustee
_____________________
INDENTURE
_____________________
Dated as of March 10, 1998
up to $200,000,000
9 1/4% Senior Subordinated Notes due 2006, Series A
9 1/4% Senior Subordinated Notes due 2006, Series B
================================================================================
<PAGE>
CROSS REFERENCE TABLE
TIA Section Indenture Section
310(a)(1).............................................. 7.10
(a)(2).............................................. 7.10
(a)(3).............................................. N.A.*
(a)(4).............................................. N.A.
(a)(5).............................................. 7.10
(b)..................................... 7.08; 7.10; 13.02
(c)................................................. N.A.
311(a)................................................. 7.11
(b)................................................. 7.11
(c)................................................. N.A.
312(a)................................................. 2.05
(b)................................................. 13.03
(c)................................................. 13.03
313(a)................................................. 7.06
(b) (1)............................................. N.A.
(b) (2)............................................. 7.06
(c)............................................ 7.06; 13.02
(d)................................................. 7.06
314(a)...................................... 4.06; 4.08; 13.02
(b)................................................. N.A.
(c) (1)............................................. 13.04
(c) (2)............................................. 13.04
(c) (3)............................................. N.A.
(d)................................................. N.A.
(e)................................................. 13.05
(f)................................................. N.A.
315(a)................................................ 7.01(b)
(b)............................................ 7.05; 13.02
(c)................................................. 7.01(a)
(d)................................................. 7.01(c)
(e)................................................. 6.11
316(a) (last sentence)................................. 2.09
(a) (1) (A)......................................... 6.05
(a) (1) (B)......................................... 6.04
(a) (2)............................................. N.A.
(b)................................................. 6.07
(c)................................................. 9.05
317(a) (1)............................................. 6.08
(a) (2)............................................. 6.09
(b)................................................. 2.04
318(a)................................................. 13.01
(c)................................................. 13.01
NOTE: THIS CROSS-REFERENCE TABLE SHALL NOT, FOR ANY PURPOSE, BE DEEMED TO BE
PART OF THE INDENTURE
*N.A. means "Not Applicable"
<PAGE>
TABLE OF CONTENTS
ARTICLE ONE DEFINITIONS AND INCORPORATION BY REFERENCE 1
Section 1.01. Definitions............................ 1
Section 1.02. Incorporation by Reference of TIA...... 23
Section 1.03. Rules of Construction.................. 23
ARTICLE TWO THE NOTES................................. 24
Section 2.01. Form and Dating........................ 24
Section 2.02. Execution and Authentication;
Aggregate Principal Amount............. 25
Section 2.03. Registrar and Paying Agent............. 26
Section 2.04. Paying Agent To Hold Assets in Trust... 27
Section 2.05. Holder Lists........................... 27
Section 2.06. Transfer and Exchange.................. 27
Section 2.07. Replacement Notes...................... 28
Section 2.08. Outstanding Notes...................... 28
Section 2.09. Treasury Notes......................... 29
Section 2.10. Temporary Notes........................ 29
Section 2.11. Cancellation........................... 29
Section 2.12. Defaulted Interest..................... 29
Section 2.13. CUSIP Numbers.......................... 30
Section 2.14. Deposit of Monies...................... 30
Section 2.15. Restrictive Legends.................... 31
Section 2.16. Book-Entry Provisions for Global
Security............................... 33
Section 2.17. Special Transfer Provisions............ 34
ARTICLE THREE REDEMPTION.............................. 36
Section 3.01. Notices to Trustee..................... 36
Section 3.02. Selection of Notes To Be Redeemed...... 36
Section 3.03. Optional Redemption.................... 37
Section 3.04. Notice of Redemption................... 37
Section 3.05. Effect of Notice of Redemption......... 38
Section 3.06. Deposit of Redemption Price............ 39
Section 3.07. Notes Redeemed in Part................. 39
ARTICLE FOUR COVENANTS............................... 39
Section 4.01. Payment of Notes....................... 39
Section 4.02. Maintenance of Office or Agency........ 40
Section 4.03. Corporate Existence.................... 40
Section 4.04. Payment of Taxes and Other Claims...... 40
Section 4.05. Maintenance of Properties and Insurance 40
Section 4.06. Compliance Certificate; Notice of
Default................................ 41
Section 4.07. Compliance with Laws................... 42
Section 4.08. Reports to Holders..................... 42
Section 4.09. Waiver of Stay, Extension or Usury Laws 42
Section 4.10. Limitation on Restricted Payments...... 42
Section 4.11. Limitations on Transactions with
Affiliates............................. 44
Section 4.12. Limitation on Incurrence of Additional
Indebtedness.......................... 45
Section 4.13. Limitation on Dividend and Other Payment
Restrictions Affecting the Company and
Restricted Subsidiaries................ 45
Section 4.14. Change of Control...................... 46
Section 4.15. Limitation on Asset Sales.............. 48
Section 4.16. Limitation on Preferred Stock of Restricted
Subsidiaries........................... 52
Section 4.17. Limitation on Liens.................... 52
Section 4.18. Additional Subsidiary Guarantees....... 52
Section 4.19. Conduct of Business.................... 53
Section 4.20. Prohibition on Incurrence of Senior
Subordinated Indebtedness.............. 53
ARTICLE FIVE SUCCESSOR CORPORATION.................... 53
Section 5.01. Merger, Consolidation and Sale of Assets 53
Section 5.02. Successor Corporation.................. 55
ARTICLE SIX REMEDIES.................................. 55
Section 6.01. Events of Default...................... 55
Section 6.02. Acceleration........................... 57
Section 6.03. Other Remedies......................... 58
Section 6.04. Waiver of Past Defaults................ 58
Section 6.05. Control by Majority.................... 58
Section 6.06. Limitation on Suits.................... 58
Section 6.07. Right of Holders To Receive Payment.... 59
Section 6.08. Collection Suit by Trustee............. 59
Section 6.09. Trustee May File Proofs of Claim....... 59
Section 6.10. Priorities............................. 60
Section 6.11. Undertaking for Costs.................. 60
ARTICLE SEVEN TRUSTEE................................. 61
Section 7.01. Duties of Trustee...................... 61
Section 7.02. Rights of Trustee...................... 62
Section 7.03. Individual Rights of Trustee........... 63
Section 7.04. Trustee's Disclaimer................... 63
Section 7.05. Notice of Default...................... 63
Section 7.06. Reports by Trustee to Holders.......... 63
Section 7.07. Compensation and Indemnity............. 64
Section 7.08. Replacement of Trustee................. 65
Section 7.09. Successor Trustee by Merger, Etc....... 65
Section 7.10. Eligibility; Disqualification.......... 66
Section 7.11. Preferential Collection of Claims Against
Company................................ 66
ARTICLE EIGHT DISCHARGE OF INDENTURE; DEFEASANCE...... 66
Section 8.01. Termination of the Company's Obligations 66
Section 8.02. Application of Trust Money............. 68
Section 8.03. Repayment to the Company............... 69
Section 8.04. Reinstatement.......................... 69
Section 8.05. Acknowledgment of Discharge by Trustee. 69
ARTICLE NINE MODIFICATION OF THE INDENTURE............ 70
Section 9.01. Without Consent of Holders............. 70
Section 9.02. With Consent of Holders................ 70
Section 9.03. Effect on Senior Debt.................. 71
Section 9.04. Compliance with TIA.................... 71
Section 9.05. Revocation and Effect of Consents...... 72
Section 9.06. Notation on or Exchange of Notes....... 72
Section 9.07. Trustee To Sign Amendments, Etc........ 72
ARTICLE TEN GUARANTEE OF NOTES........................ 73
Section 10.01. Unconditional Guarantee............... 73
Section 10.02. Limitations on Guarantee.............. 74
Section 10.03. Execution and Delivery of Guarantee... 74
Section 10.04. Release of Subsidiary Guarantors...... 75
Section 10.05. Waiver of Subrogation................. 75
Section 10.06. Immediate Payment..................... 76
Section 10.07. Obligations Continuing................ 76
Section 10.08. Obligations Reinstated................ 76
Section 10.09. Obligations Not Affected.............. 76
Section 10.10. Waiver................................ 77
Section 10.11. No Obligation To Take Action.......... 77
Section 10.12. Dealing with the Company and Others... 77
Section 10.13. Default and Enforcement............... 78
Section 10.14. Amendment, Etc........................ 78
Section 10.15. Acknowledgment........................ 78
Section 10.16. Costs and Expenses.................... 78
Section 10.17. No Waiver; Cumulative Remedies........ 78
Section 10.18. Survival of Obligations............... 78
Section 10.19. Guarantee in Addition to Other
Obligations........................... 79
Section 10.20. Severability.......................... 79
Section 10.21. Successors and Assigns................ 79
ARTICLE ELEVEN SUBOORDINATION......................... 79
Section 11.01. Notes Subordinated to Senior Debt..... 79
Section 11.02. No Payment on Notes in Certain
Circumstances......................... 79
Section 11.03. Payment Over of Proceeds upon Dissolution,
Etc................................... 81
Section 11.04. Payments May Be Paid Prior to
Dissolution........................... 82
Section 11.05. Subrogation........................... 82
Section 11.06. Obligations of the Company
Unconditional........................ 82
Section 11.07. Notice to Trustee..................... 83
Section 11.08. Reliance on Judicial Order or Certificate
of Liquidating Agent.................. 83
Section 11.09. Application by Trustee of Assets Deposited
with It............................... 83
Section 11.10. Trustee's Relation to Senior Debt..... 84
Section 11.11. Subordination Rights Not Impaired by Acts
or Omissions of the Company or Holders of
Senior Debt........................... 84
Section 11.12. Holders Authorize Trustee To Effectuate
Subordination of Notes................ 85
Section 11.13. This Article Eleven Not To Prevent Events
of Default............................ 85
Section 11.14. Trustee's Compensation Not Prejudiced. 85
ARTICLE TWELVE SUBORDINATION OF GUARANTEES............ 86
Section 12.01. Obligations of Guarantors Subordinated to
Guarantor Senior Debt................................ 86
Section 12.02. Suspension of Guarantee Obligations When
Guarantor............................. 86
Senior Debt is in Default............................ 86
Section 12.03. Guarantee Obligations Subordinated to
Prior Payment of All Guarantor Senior
Debt on Dissolution, Liquidation or
Reorganization of Such Subsidiary
Guarantor............................. 87
Section 12.04. Holders of Guarantee Obligations To Be
Subrogated............................ 88
to Rights of Holders of Guarantor Senior Debt........ 88
Section 12.05. Obligations of the Subsidiary Guarantors
Unconditional......................... 89
Section 12.06. Trustee Entitled To Assume Payments Not
Prohibited In Absence of Notice....... 90
Section 12.07. Application by Trustee of Assets
Deposited with It..................... 90
Section 12.08. No Waiver of Subordination Provisions. 91
Section 12.09. Holders Authorize Trustee To Effectuate
Subordination of Guarantee Obligations 91
Section 12.10. Right of Trustee to Hold Guarantor Senior
Debt.................................. 92
Section 12.11. No Suspension of Remedies............. 92
ARTICLE THIRTEEN MISCELLANEOUS........................ 92
Section 13.01. TIA Controls.......................... 92
Section 13.02. Notices............................... 93
Section 13.03. Communications by Holders with other
Holders.............................. 95
Section 13.04. Certificate and Opinion as to Conditions
Precedent............................ 95
Section 13.05. Statements Required in Certificate or
Opinion.............................. 95
Section 13.06. Rules by Trustee, Paying Agent,
Registrar............................ 95
Section 13.07. Legal Holidays....................... 96
Section 13.08. Governing Law........................ 96
Section 13.09. No Adverse Interpretation of Other
Agreements........................... 96
Section 13.10. No Personal Liability................ 96
Section 13.11. Successors........................... 96
Section 13.12. Duplicate Originals.................. 96
Section 13.13. Severability......................... 96
Section 13.14. Independence of Covenants............ 97
EXHIBIT A Form of Exchange Note.................... A-1
EXHIBIT B Form of Exchange Note.................... B-1
EXHIBIT C Form of Certificate To Be Delivered in
Connection with Transfers to Non-QIB
Accredited Investors..................... C-1
EXHIBIT D Form of Certificate To Be Delivered in
Connection with Transfers of Pursuant to
Regulation S............................. C-1
EXHIBIT E Form of Guarantee........................ E-1
Note: This Table of Contents shall not, for any purpose, be deemed to be part
of the Indenture.
<PAGE>
INDENTURE, dated as of March 10, 1998, among SITEL CORPORATION, a Minnesota
corporation (the "Company"), each of the Subsidiary Guarantors named herein, as
guarantors, and The First National Bank of Maryland, as Trustee (the "Trustee").
The Company has duly authorized the creation of an issue of 9 1/4% Senior
Subordinated Notes due 2006, Series A to be issued initially in the principal
amount of $100,000,000 and thereafter in an additional principal amount, if any,
up to $100,000,000 subject to the terms and conditions contained herein, and
9 1/4% Senior Subordinated Notes due 2006, Series B, to be issued in exchange
for the 9 1/4% Senior Subordinated Notes due 2006, Series A, pursuant to a
Registration Rights Agreement (as defined) and, to provide therefor, the Company
has duly authorized the execution and delivery of this Indenture. The Company
has taken, or caused to be taken, all actions and has done, or caused to be
done, all things necessary to make the Notes (as defined), when duly issued and
executed by the Company and authenticated and delivered hereunder, the valid and
binding obligations of the Company and to make this Indenture a valid and
binding agreement of the Company, have been done.
Each party hereto agrees as follows for the benefit of the other parties
and for the equal and ratable benefit of the Holders of the Company's 9 1/4%
Senior Subordinated Notes due 2006, Series A and Series B.
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
"Acquired Indebtedness" means Indebtedness of a Person or any of its
Subsidiaries existing at the time such Person becomes a Restricted Subsidiary of
the Company or at the time it merges or consolidates with the Company or any of
its Restricted Subsidiaries or assumed in connection with the acquisition of
assets from such Person and in each case not incurred by such Person in
connection with, or in anticipation or contemplation of, such Person becoming a
Restricted Subsidiary of the Company or such acquisition, merger or
consolidation.
"Additional Interest" shall have the meaning set forth in the Registration
Rights Agreement.
"Affiliate" means, with respect to any specified Person, any other Person
who directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such specified Person. The term
"control" means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of a Person, whether
through the ownership of voting securities, by contract or otherwise; and the
terms "controlling" and "controlled" have meanings correlative of the foregoing.
"Affiliate Transaction" has the meaning provided in Section 4.11.
"Agent" means any Registrar, Paying Agent or Co-Registrar.
"Agent Members" has the meaning provided in Section 2.16.
"Amended Credit Facility" means the Credit Agreement dated as of July 24,
1997 and amended and restated as of March 10, 1998 among the Company, the
lenders party thereto in their capacities as lenders thereunder, and Bankers
Trust Company, as agent, together with the related documents thereto (including,
without limitation, any promissory notes, letters of credit, guarantee
agreements and security documents), in each case as such agreements may be
amended (including any amendment and restatement thereof), supplemented or
otherwise modified from time to time, including any agreement extending the
maturity of, refinancing, replacing or otherwise restructuring (including
increasing the amount of available borrowings thereunder or adding Restricted
Subsidiaries of the Company as additional borrowers or guarantors thereunder)
all or any portion of the Indebtedness under such agreement or any successor or
replacement agreement and whether by the same or any other agent or agents,
lender or group of lenders.
"Asset Acquisition" means (a) an Investment by the Company or any
Restricted Subsidiary of the Company in any other Person pursuant to which such
Person shall become a Restricted Subsidiary of the Company or any Restricted
Subsidiary of the Company or shall be merged with or into the Company or any
Restricted Subsidiary of the Company, or (b) the acquisition by the Company or
any Restricted Subsidiary of the Company of the assets of any Person (other than
a Restricted Subsidiary of the Company) which constitute all or substantially
all of the assets of such Person or comprises any division or line of business
of such Person or any other properties or assets of such Person other than in
the ordinary course of business.
"Asset Sale" means any direct or indirect sale, issuance, conveyance,
transfer, lease (other than operating leases entered into in the ordinary course
of business), assignment or other transfer for value by the Company or any of
its Restricted Subsidiaries (including any Sale and Leaseback Transaction) to
any Person other than the Company or a Wholly Owned Restricted Subsidiary of the
Company of (a) any Capital Stock of any Restricted Subsidiary of the Company or
(b) any other property or assets of the Company or any Restricted Subsidiary of
the Company other than in the ordinary course of business; provided, however,
that Asset Sales shall not include (i) a transaction or series of related
transactions for which the Company or its Restricted Subsidiaries receive
consideration of less than $500,000 for such transaction or series of related
transactions, (ii) the sale, lease, conveyance, disposition or other transfer of
all or substantially all of the assets of the Company as permitted under Section
5.01 of this Indenture, (iii) disposals or replacements of obsolete or outdated
equipment in the ordinary course of business, (iv) the sale or discount, in each
case without recourse (other than recourse for a breach of a representation or
warranty), of accounts receivable arising in the ordinary course of business,
but only in connection with the compromise or collection thereof in the ordinary
course of business and not as part of a financing transaction, and (v) a
transaction involving the transfer of assets to an Unrestricted Subsidiary, if
made pursuant to and permitted under Section 4.10 of this Indenture.
"Authenticating Agent" has the meaning provided in Section 2.02.
"Bankruptcy Law" means Title 11, U.S. Code, as amended from time to time,
or any similar Federal, state or foreign law for the relief of debtors.
"Blockage Period" has the meaning provided in Section 11.02.
"Board of Directors" means, as to any Person, the board of directors of
such Person or any duly authorized committee thereof.
"Board Resolution" means, with respect to any Person, a copy of a
resolution certified by the Secretary or an Assistant Secretary of such Person
to have been duly adopted by the Board of Directors of such Person and to be in
full force and effect on the date of such certification, and delivered to the
Trustee.
"Business Day" means any day other than a Saturday, Sunday or any other day
on which commercial banking institutions in the City of New York or the city in
which the Trustee is located are required or authorized by law or other
governmental action to be closed.
"Capitalized Lease Obligation" means, as to any Person, the Obligations of
such Person under a lease that are required to be classified and accounted for
as capital lease obligations under GAAP and, for purposes of this definition,
the amount of such Obligations at any date shall be the capitalized amount of
such Obligations at such date, determined in accordance with GAAP.
"Capital Stock" means (i) with respect to any Person that is a corporation,
any and all shares, interests, participations or other equivalents (however
designated and whether or not voting) of corporate stock, including each class
of Common Stock and Preferred Stock of such Person and (ii) with respect to any
Person that is not a corporation, any and all partnership or other equity
interests of such Person.
"Cash Equivalents" means (i) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition thereof; (ii)
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having one of the two highest ratings
obtainable from either S&P or Moody's; (iii) commercial paper maturing no more
than one year from the date of creation thereof and, at the time of acquisition,
having a rating of at least A-1 from S&P or at least P-1 from Moody's; (iv)
certificates of deposit or bankers' acceptances maturing within one year from
the date of acquisition thereof issued by any bank organized under the laws of
the United States of America or any state thereof or the District of Columbia or
any U.S. branch of a foreign bank having at the date of acquisition thereof
combined capital and surplus of not less than $250,000,000; (v) repurchase
obligations with a term of not more than seven days for underlying securities of
the types described in clause (i) above entered into with any bank meeting the
qualifications specified in clause (iv) above; and (vi) investments in money
market funds which invest substantially all their assets in securities of the
types described in clauses (i) through (v) above.
"Certificated Securities" means Notes in definitive registered form.
"Change of Control" means the occurrence of one or more of the following
events: (i) any sale, lease, exchange or other transfer (in one transaction or
a series of related transactions) of all or substantially all of the assets of
the Company to any Person or group of related Persons for purposes of Section
13(d) of the Exchange Act (a "Group"), together with any Affiliates thereof
(whether or not otherwise in compliance with the provisions of this Indenture);
(ii) the approval by the holders of the Capital Stock of the Company of any plan
or proposal for the liquidation or dissolution of the Company (whether or not
otherwise in compliance with the provisions of this Indenture); (iii) any Person
or Group, other than the Permitted Holders, shall become the owner, directly or
indirectly, beneficially or of record, of shares representing more than 50% of
the aggregate ordinary voting power represented by the issued and outstanding
Capital Stock of the Company; or (iv) the replacement of a majority of the Board
of Directors of the Company over a two-year period from the directors who
constituted the Board of Directors of the Company at the beginning of such
period, and such replacement shall not have been approved by a vote of at least
a majority of the Board of Directors of the Company then still in office who
either were members of such Board of Directors at the beginning of such period
or whose election as a member of such Board of Directors was previously so
approved.
"Change of Control Offer" has the meaning provided in Section 4.14.
"Change of Control Payment Date" has the meaning provided in Section 4.14.
"Commission" means the U.S. Securities and Exchange Commission.
"Common Stock" of any Person means any and all shares, interests or other
participations in, and other equivalents (however designated and whether voting
or non-voting) of such Person's common stock, whether outstanding on the Issue
Date or issued after the Issue Date, and includes, without limitation, all
series and classes of such common stock.
"Company" means SITEL Corporation, a Minnesota corporation.
"Consolidated EBITDA" means, with respect to any Person, for any period,
the sum (without duplication) of (i) Consolidated Net Income and (ii) to the
extent Consolidated Net Income has been reduced thereby, (A) all income taxes of
such Person and its Restricted Subsidiaries paid or accrued in accordance with
GAAP for such period (other than income taxes attributable to extraordinary,
unusual or nonrecurring gains or losses or taxes attributable to sales or
dispositions outside the ordinary course of business), (B) Consolidated Interest
Expense and (C) Consolidated Non-cash Charges less any non-cash items increasing
Consolidated Net Income for such period, all as determined on a consolidated
basis for such Person and its Restricted Subsidiaries in accordance with GAAP.
"Consolidated Fixed Charge Coverage Ratio" means, with respect to any
Person, the ratio of Consolidated EBITDA of such Person during the four full
fiscal quarters (the "Four Quarter Period") ending on or prior to the date of
the transaction giving rise to the need to calculate the Consolidated Fixed
Charge Coverage Ratio (the "Transaction Date") to Consolidated Fixed Charges of
such Person for the Four Quarter Period. In addition to and without limitation
of the foregoing, for purposes of this definition, "Consolidated EBITDA" and
"Consolidated Fixed Charges" shall be calculated after giving effect on a pro
forma basis for the period of such calculation to (i) the incurrence of any
Indebtedness of such Person or any of its Restricted Subsidiaries (and the
application of the proceeds thereof) giving rise to the need to make such
calculation and any incurrence of other Indebtedness (and the application of the
proceeds thereof), other than the incurrence of Indebtedness in the ordinary
course of business for working capital purposes pursuant to working capital
facilities, occurring during the Four Quarter Period or at any time subsequent
to the last day of the Four Quarter Period and on or prior to the Transaction
Date, as if such incurrence (and the application of the proceeds thereof)
occurred on the first day of the Four Quarter Period and (ii) any Asset Sales or
Asset Acquisitions (including, without limitation, any Asset Acquisition giving
rise to the need to make such calculation as a result of such Person or one of
its Restricted Subsidiaries (including any Person who becomes a Restricted
Subsidiary as a result of the Asset Acquisition) incurring, assuming or
otherwise being liable for Acquired Indebtedness and also including any
Consolidated EBITDA (including any pro forma expenses and cost reductions
calculated on a basis consistent with Regulation S-X under the Securities Act as
in effect on the Issue Date) (provided that such Consolidated EBITDA shall be
included only to the extent includable pursuant to the definition of
"Consolidated Net Income") attributable to the assets which are the subject of
the Asset Acquisition or Asset Sale during the Four Quarter Period) occurring
during the Four Quarter Period or at any time subsequent to the last day of the
Four Quarter Period and on or prior to the Transaction Date, as if such Asset
Sale or Asset Acquisition (including the incurrence, assumption or liability for
any such Acquired Indebtedness) occurred on the first day of the Four Quarter
Period. If such Person or any of its Restricted Subsidiaries directly or
indirectly guarantees Indebtedness of a third Person, the preceding sentence
shall give effect to the incurrence of such guaranteed Indebtedness as if such
Person or any Restricted Subsidiary of such Person had directly incurred or
otherwise assumed such guaranteed Indebtedness. Furthermore, in calculating
"Consolidated Fixed Charges" for purposes of determining the denominator (but
not the numerator) of this "Consolidated Fixed Charge Coverage Ratio," (1)
interest on outstanding Indebtedness determined on a fluctuating basis as of the
Transaction Date and which will continue to be so determined thereafter shall be
deemed to have accrued at a fixed rate per annum equal to the rate of interest
on such Indebtedness in effect on the Transaction Date; (2) if interest on any
Indebtedness actually incurred on the Transaction Date may optionally be
determined at an interest rate based upon a factor of a prime or similar rate, a
eurocurrency interbank offered rate, or other rates, then the interest rate in
effect on the Transaction Date will be deemed to have been in effect during the
Four Quarter Period; and (3) notwithstanding clause (1) above, interest on
Indebtedness determined on a fluctuating basis, to the extent such interest is
covered by agreements relating to Interest Swap Obligations, shall be deemed to
accrue at the rate per annum resulting after giving effect to the operation of
such agreements. Any Indebtedness repaid out of the proceeds of Indebtedness
properly incurred under this Indenture during any Four Quarter Period shall be
deemed to have been repaid on the first day of such Four Quarter Period.
"Consolidated Fixed Charges" means, with respect to any Person for any
period, the sum, without duplication, of (i) Consolidated Interest Expense, plus
(ii) the product of (x) the amount of all dividend payments on any series of
Preferred Stock of such Person (other than dividends paid in Qualified Capital
Stock) paid, accrued or scheduled to be paid or accrued during such period times
(y) a fraction, the numerator of which is one and the denominator of which is
one minus the then current effective consolidated federal, state and local
income tax rate of such Person, expressed as a decimal.
"Consolidated Interest Expense" means, with respect to any Person for any
period, the sum of, without duplication: (i) the aggregate of the interest
expense of such Person and its Restricted Subsidiaries and its Permitted Joint
Ventures which are not Restricted Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP, including without limitation, (a)
any amortization of debt discount and amortization or write-off of deferred
financing costs, (b) the net costs under Interest Swap Obligations, (c) all
capitalized interest and (d) the interest portion of any deferred payment
obligation; and (ii) the interest component of Capitalized Lease Obligations
paid, accrued and/or scheduled to be paid or accrued by such Person and its
Restricted Subsidiaries and its Permitted Joint Ventures which are not
Restricted Subsidiaries during such period as determined on a consolidated basis
in accordance with GAAP; provided, that amounts to be included in clauses (i)
and (ii) with respect to a Permitted Joint Venture not constituting a Restricted
Subsidiary shall be the product of the amounts computed in accordance with GAAP
and the percentage of the total outstanding shares of Capital Stock of such
Permitted Joint Venture held by the Company or any Restricted Subsidiary of the
Company.
"Consolidated Net Income" means, with respect to any Person, for any
period, the aggregate net income (or loss) of such Person and its Restricted
Subsidiaries for such period on a consolidated basis, determined in accordance
with GAAP; provided that there shall be excluded therefrom (a) after-tax gains
or losses from Asset Sales or abandonments or reserves relating thereto, (b)
after-tax items classified as extraordinary or nonrecurring gains, (c) the net
income or loss of any Person acquired in a "pooling of interests" transaction
accrued prior to the date it becomes a Restricted Subsidiary of the referent
Person or is merged or consolidated with the referent Person or any Restricted
Subsidiary of the referent Person, (d) the net income (but not loss) of any
Restricted Subsidiary of the referent Person to the extent that the declaration
of dividends or similar distributions by that Restricted Subsidiary of that
income is restricted by a contract, operation of law or otherwise, (e) the net
income of any Person, other than a Restricted Subsidiary of the referent Person
(except in the case of (d) and (e) to the extent of cash dividends or
distributions paid to the referent Person or to a Restricted Subsidiary of the
referent Person by such Person), (f) any restoration to income of any
contingency reserve, except to the extent that provision for such reserve was
made out of Consolidated Net Income accrued at any time following the Issue
Date, (g) income or loss attributable to discontinued operations (including,
without limitation, operations disposed of during such period whether or not
such operations were classified as discontinued), and (h) in the case of a
successor to the referent Person by consolidation or merger or as a transferee
of the referent Person's assets, any earnings of the successor corporation prior
to such consolidation, merger or transfer of assets.
"Consolidated Net Worth" of any Person means the consolidated stockholders'
equity of such Person, determined on a consolidated basis in accordance with
GAAP, less (without duplication) amounts attributable to Disqualified Capital
Stock of such Person.
"Consolidated Non-cash Charges" means, with respect to any Person, for any
period, the aggregate depreciation, amortization and other non-cash expenses of
such Person and its Restricted Subsidiaries reducing Consolidated Net Income of
such Person and its Restricted Subsidiaries for such period, determined on a
consolidated basis in accordance with GAAP (excluding any such charges
constituting an extraordinary item or loss or any such charge which requires an
accrual of or a reserve for cash charges for any future period).
"Corporate Trust Office" means the office of the Trustee at which at any
particular time its corporate trust business shall be principally administered,
which office at the date of execution of this Indenture is located at 25 South
Charles Street, 16th Floor, Baltimore, Maryland 21201.
"Covenant Defeasance" has the meaning set forth in Section 8.01.
"Currency Agreement" means any foreign exchange contract, currency swap
agreement or other similar agreement or arrangement designed to protect the
Company or any Restricted Subsidiary of the Company against fluctuations in
currency values.
"Custodian" means any receiver, trustee, assignee, liquidator, sequestrator
or similar official under any Bankruptcy Law.
"Default" means an event or condition the occurrence of which is, or with
the lapse of time or the giving of notice or both would be, an Event of Default.
"Depository" means The Depository Trust Company, its nominees and
successors and any institution that succeeds the Depository Trust Company as
depository and Holder of Global Notes hereunder.
"Designated Senior Debt" means (i) Indebtedness under or in respect of the
Amended Credit Facility and (ii) any other Indebtedness constituting Senior Debt
or Guarantor Senior Debt which, at the time of determination, has an aggregate
principal amount of at least $25 million and is specifically designated in the
instrument evidencing such Senior Debt as "Designated Senior Debt" by the
Company or "Guarantor Senior Debt" by a Subsidiary Guarantor, as the case may
be.
"Disqualified Capital Stock" means that portion of any Capital Stock which,
by its terms (or by the terms of any security into which it is convertible or
for which it is exchangeable), or upon the happening of any event (other than
upon the sale (by merger or otherwise) of all of the Common Stock of the
Company), matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the sole option of the holder
thereof on or prior to the final maturity date of the Notes.
"Event of Default" has the meaning provided in Section 6.01.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, or
any successor statute or statutes thereto.
"Exchange Notes" means the 9 1/4% Senior Subordinated Notes due 2006,
Series B to be issued in exchange for the Initial Notes pursuant to the
Registration Rights Agreement or, with respect to Initial Notes issued under
this Indenture subsequent to the Issue Date pursuant to Section 2.02, a
registration rights agreement substantially identical to the Registration Rights
Agreement.
"Exchange Offer Registration Statement" means the registration statement
filed by the Company pursuant to the Registration Rights Agreement.
"fair market value" means, with respect to any asset or property, the price
which could be negotiated in an arm's-length, free market transaction, for cash,
between a willing seller and a willing and able buyer, neither of whom is under
undue pressure or compulsion to complete the transaction. Fair market value
shall be determined by the Board of Directors of the Person making such
determination acting reasonably and in good faith and shall be evidenced by a
Board Resolution of the Board of Directors of such Person delivered to the
Trustee.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession of the United States, which are in effect as of the Issue Date.
"Global Note" has the meaning provided in Section 2.01.
"guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness. The term "guarantee" used as a verb has a corresponding meaning.
"Guarantee" means the guarantee of the Notes by the Subsidiary Guarantors.
"Guarantor Senior Debt" means with respect to any Subsidiary Guarantor, (i)
the principal of, premium, if any, and interest (including any interest accruing
subsequent to the filing of a petition of bankruptcy at the rate provided for in
the documentation with respect thereto, whether or not such interest is an
allowed claim under applicable law) on any Indebtedness of a Subsidiary
Guarantor, whether outstanding on the Issue Date or thereafter created, incurred
or assumed, unless, in the case of any particular Indebtedness, the instrument
creating or evidencing the same or pursuant to which the same is outstanding
expressly provides that such Indebtedness shall not be senior in right of
payment to the Guarantee of such Subsidiary Guarantor. Without limiting the
generality of the foregoing, "Guarantor Senior Debt" shall also include the
principal of, premium, if any, interest (including any interest accruing
subsequent to the filing of a petition of bankruptcy at the rate provided for in
the documentation with respect thereto, whether or not such interest is an
allowed claim under applicable law) on, and all other amounts owing in respect
of, (x) all monetary obligations of every nature of a Subsidiary Guarantor under
the Amended Credit Facility, including, without limitation, obligations to pay
principal and interest, reimbursement obligations under letters of credit, fees,
expenses and indemnities, (y) all Interest Swap Obligations and (z) all
obligations under Currency Agreements, in each case whether outstanding on the
Issue Date or thereafter incurred. Notwithstanding the foregoing, "Guarantor
Senior Debt" shall not include (i) any Indebtedness of such Subsidiary Guarantor
to a Restricted Subsidiary of such Subsidiary Guarantor or any Affiliate of such
Subsidiary Guarantor or any of such Affiliate's Subsidiaries, (ii) Indebtedness
to, or guaranteed on behalf of, any shareholder, director, officer or employee
of such Subsidiary Guarantor or any Restricted Subsidiary of such Subsidiary
Guarantor (including, without limitation, amounts owed for compensation), (iii)
Indebtedness to trade creditors and other amounts incurred in connection with
obtaining goods, materials or services, (iv) Indebtedness represented by
Disqualified Capital Stock, (v) any liability for federal, state, local or other
taxes owed or owing by such Subsidiary Guarantor, (vi) that portion of any
Indebtedness incurred in violation of Section 4.12 of this Indenture (but, as to
any such obligation, no such violation shall be deemed to exist for purposes of
this clause (vi) if the holder(s) of such obligation or their representative and
the Trustee shall have received an Officers' Certificate of the Company to the
effect that the incurrence of such Indebtedness does not (or, in the case of
revolving credit Indebtedness, that the incurrence of the entire committed
amount thereof at the date on which the initial borrowing thereunder is made
would not) violate such Section 4.12 of this Indenture), (vii) that portion of
any Indebtedness which, when incurred and without respect to any election under
Section 1111(b) of Title 11, United States Code, is without recourse to the
Company and (viii) that portion of any Indebtedness which is, by its express
terms, subordinated in right of payment to any other Indebtedness of such
Subsidiary Guarantor.
"Holder" means a holder of Notes.
"Incur" has the meaning set forth in Section 4.12.
"Indebtedness" means with respect to any Person, without duplication, (i)
all Obligations of such Person for borrowed money, (ii) all Obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all Capitalized Lease Obligations of such Person, (iv) all Obligations of such
Person issued or assumed as the deferred purchase price of property, all
conditional sale obligations and all Obligations of such Person under any title
retention agreement (but excluding federal, state or local taxes owed by such
Person and trade accounts payable and other accrued liabilities arising in the
ordinary course of business), (v) all Obligations of such Person for the
reimbursement of any obligor on any letter of credit, banker's acceptance or
similar credit transaction, (vi) guarantees and other contingent Obligations of
such Person in respect of Indebtedness referred to in clauses (i) through (v)
above and clause (viii) below, (vii) all Obligations of any other Person of the
type referred to in clauses (i) through (vi) above which are secured by any lien
on any property or asset of such Person, the amount of such Obligation being
deemed to be the lesser of the fair market value of such property or asset or
the amount of the Obligation so secured, (viii) all Obligations of such Person
under Currency Agreements and in respect of Interest Swap Obligations of such
Person and (ix) all Disqualified Capital Stock issued by such Person with the
amount of Indebtedness represented by such Disqualified Capital Stock being
equal to the book value of such Disqualified Capital Stock. For purposes
hereof, the amount outstanding at any time of any Indebtedness with original
issue discount is the face amount of such Indebtedness less the remaining
unamortized portion of the original issue discount of such Indebtedness at such
time as determined in conformity with GAAP.
"Indenture" means this Indenture, as amended or supplemented from time to
time in accordance with the terms hereof.
"Independent Financial Advisor" means a firm (i) which does not, and whose
directors, officers and employees or Affiliates do not, have a direct or
indirect financial interest in the Company and (ii) which, in the judgment of
the Board of Directors of the Company, is otherwise independent and qualified to
perform the task for which it is to be engaged.
"Initial Notes" means, collectively, (i) the 9 1/4% Senior Subordinated
Notes due 2006, Series A, of the Company issued on the Issue Date and (ii) one
or more series of 9 1/4% Senior Subordinated Notes due 2006 that are issued
under this Indenture subsequent to the Issue Date pursuant to Section 2.02, in
each case for so long as such securities constitute Restricted Securities.
"Initial Purchasers" means BT Alex. Brown Incorporated, Merrill Lynch & Co.
and SBC Warburg Dillon Read Inc. or any other original purchasers of any Initial
Notes issued after the Issue Date.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"Interest" when used with respect to any Note means the amount of all
interest accruing on such Note, including any applicable defaulted interest
pursuant to Section 2.12 and any Additional Interest pursuant to the
Registration Rights Agreement.
"Interest Payment Date" means the stated maturity of an installment of
interest on the Notes.
"Interest Swap Obligations" means the obligations of any Person pursuant to
any arrangement with any other Person, whereby, directly or indirectly, such
Person is entitled to receive from time to time periodic payments calculated by
applying either a floating or a fixed rate of interest on a stated notional
amount in exchange for periodic payments made by such other Person calculated by
applying a fixed or a floating rate of interest on the same notional amount and
shall include, without limitation, interest rate swaps, caps, floors, collars
and similar agreements.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as amended
to the date hereof and from time to time hereafter.
"Investment" means, with respect to any Person, any direct or indirect loan
or other extension of credit (including, without limitation, a guarantee) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition by such Person of any Capital Stock,
bonds, notes, debentures or other securities or evidences of Indebtedness issued
by, any Person. "Investment" shall exclude extensions of trade credit by the
Company and its Restricted Subsidiaries on commercially reasonable terms in the
ordinary course of business. For the purposes of Section 4.10 hereof, (i)
"Investment" shall include and be valued at the fair market value of the net
assets of any Restricted Subsidiary at the time that such Restricted Subsidiary
is designated an Unrestricted Subsidiary and shall exclude the fair market value
of the net assets of any Unrestricted Subsidiary at the time that such
Unrestricted Subsidiary is designated a Restricted Subsidiary and (ii) the
amount of any Investment shall be the original cost of such Investment plus the
cost of all additional Investments by the Company or any of its Restricted
Subsidiaries, without any adjustments for increases or decreases in value, or
write-ups, write-downs or write-offs with respect to such Investment, reduced by
the payment of dividends or distributions in connection with such Investment or
any other amounts received in respect of such Investment; provided, that no such
payment of dividends or distributions or receipt of any such other amounts shall
reduce the amount of any Investment if such payment of dividends or
distributions or receipt of any such amounts would be included in Consolidated
Net Income. If the Company or any Restricted Subsidiary of the Company sells or
otherwise disposes of any Common Stock of any direct or indirect Restricted
Subsidiary of the Company such that, after giving effect to any such sale or
disposition, the Company no longer owns, directly or indirectly, greater than
50% of the outstanding Common Stock of such Restricted Subsidiary, the Company
shall be deemed to have made an Investment on the date of any such sale or
disposition equal to the fair market value of the Common Stock of such
Restricted Subsidiary not sold or disposed of.
"Issue Date" means March 10, 1998, being the date of original issuance of
the Notes.
"Legal Defeasance" has the meaning set forth in Section 8. 01.
"Legal Holiday" has the meaning provided in Section 13.07.
"Lien" means any lien, mortgage, deed of trust, pledge, security interest,
charge or encumbrance of any kind (including any conditional sale or other title
retention agreement, any lease in the nature thereof and any agreement to give
any security interest).
"Maturity Date" means March 15, 2006.
"Moody's" means Moody's Investors Service, Inc. and its successors.
"Net Cash Proceeds" means, with respect to any Asset Sale, the proceeds in
the form of cash or Cash Equivalents including payments in respect of deferred
payment obligations when received in the form of cash or Cash Equivalents (other
than the portion of any such deferred payment constituting interest) received by
the Company or any of its Restricted Subsidiaries from such Asset Sale net of
(a) cash expenses and fees relating to such Asset Sale (including, without
limitation, legal, accounting and investment banking fees and sales
commissions), (b) taxes paid or payable after taking into account any reduction
in consolidated tax liability due to available tax credits or deductions and any
tax sharing arrangements, (c) repayment of Indebtedness that is required to be
repaid in connection with such Asset Sale and (d) appropriate amounts to be
provided by the Company or any Restricted Subsidiary, as the case may be, as a
reserve, in accordance with GAAP, against any liabilities associated with such
Asset Sale and retained by the Company or any Restricted Subsidiary, as the case
may be, after such Asset Sale, including, without limitation, pension and other
post-employment benefit liabilities, liabilities related to environmental
matters and liabilities under any indemnification obligations associated with
such Asset Sale.
"Net Proceeds Offer" has the meaning set forth in Section 4.15.
"Net Proceeds Offer Amount" has the meaning set forth in Section 4.15.
"Net Proceeds Offer Payment Date" has the meaning set forth in Section
4.15.
"Net Proceeds Offer Trigger Date" has the meaning set forth in Section
4.15.
"Non-Domestic Restricted Subsidiary" means any Restricted Subsidiary not
organized under the laws of the United States or any State thereof or the
District of Columbia that conducts its business primarily outside the United
States.
"Notes" means, collectively, the Initial Notes, the Private Exchange Notes,
if any, and the Exchange Notes, treated as a single class of securities, as
amended or supplemented from time to time in accordance with the terms of this
Indenture, that are issued pursuant to this Indenture.
"Obligations" means all obligations for principal, premium, interest,
penalties, fees, indemnifications, reimbursements, damages and other liabilities
payable under the documentation governing any Indebtedness.
"Offering Memorandum" means the confidential Offering Memorandum dated
March 5, 1998 of the Company relating to the offering of the Initial Notes.
"Officer" means, with respect to any Person, the Chairman of the Board of
Directors, the Chief Executive Officer, the President, any Vice President, the
Chief Financial Officer, the Treasurer, the Controller, or the Secretary of such
Person, or any other officer designated by the Board of Directors serving in a
similar capacity.
"Officers' Certificate" means, with respect to any Person, a certificate
signed by the Chief Executive Officer, the President or any Vice President and
the Chief Financial Officer or any Treasurer of such Person that shall comply
with applicable provisions of this Indenture.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee complying with the requirements of Sections
13.04 and 13.05, as they relate to the giving of an Opinion of Counsel.
"Paying Agent" has the meaning provided in Section 2.03.
"Permitted Holder" means James F. Lynch.
"Permitted Indebtedness" means, without duplication, each of the following:
(i) Indebtedness incurred on the Issue Date under the Notes,
this Indenture and the Guarantees, and Indebtedness and Guarantees of
such Indebtedness under this Indenture properly incurred in accordance
with Section 4.12 hereof;
(ii) Indebtedness incurred pursuant to the Amended Credit
Facility in an aggregate principal amount at any time outstanding not
to exceed $75.0 million;
(iii) other Indebtedness of the Company and its Restricted
Subsidiaries outstanding on the Issue Date reduced by the amount of
any scheduled amortization payments or mandatory prepayments when
actually paid or permanent reductions thereon;
(iv) Interest Swap Obligations of the Company or any Restricted
Subsidiary of the Company covering Indebtedness of the Company or any
of its Restricted Subsidiaries; provided, however, that such Interest
Swap Obligations are entered into to protect the Company and its
Restricted Subsidiaries from fluctuations in interest rates on
Indebtedness incurred in accordance with this Indenture to the extent
the notional principal amount of such Interest Swap Obligation does
not exceed the principal amount of the Indebtedness to which such
Interest Swap Obligation relates;
(v) Indebtedness under Currency Agreements; provided that in the
case of Currency Agreements which relate to Indebtedness, such
Currency Agreements do not increase the Indebtedness of the Company
and its Restricted Subsidiaries outstanding other than as a result of
fluctuations in foreign currency exchange rates or by reason of fees,
indemnities and compensation payable thereunder;
(vi) Indebtedness of a Wholly Owned Restricted Subsidiary of the
Company to the Company or to a Wholly Owned Restricted Subsidiary of
the Company for so long as such Indebtedness is held by the Company, a
Wholly Owned Restricted Subsidiary of the Company or the lenders or
collateral agent under the Amended Credit Facility, in each case
subject to no Lien held by a Person other than the Company, a Wholly
Owned Restricted Subsidiary of the Company or the lenders or
collateral agent under the Amended Credit Facility; provided that if
as of any date any Person other than the Company, a Wholly Owned
Restricted Subsidiary of the Company or the lenders or collateral
agent under the Amended Credit Facility owns or holds any such
Indebtedness or holds a Lien in respect of such Indebtedness, such
date shall be deemed the incurrence of Indebtedness not constituting
Permitted Indebtedness by the issuer of such Indebtedness;
(vii) Indebtedness of the Company to a Wholly Owned
Restricted Subsidiary of the Company for so long as such Indebtedness
is held by a Wholly Owned Restricted Subsidiary of the Company or the
lenders or collateral agent under the Amended Credit Facility, subject
to no Lien other than a lien held by the lenders or collateral agent
under the Amended Credit Facility; provided that (a) any Indebtedness
of the Company to any Wholly Owned Restricted Subsidiary of the
Company is unsecured and subordinated, pursuant to a written
agreement, to the Company's obligations under this Indenture and the
Notes and (b) if as of any date any Person other than a Wholly Owned
Restricted Subsidiary of the Company or the lenders or collateral
agent under the Amended Credit Facility owns or holds any such
Indebtedness or any Person holds a Lien in respect of such
Indebtedness, such date shall be deemed the incurrence of Indebtedness
not constituting Permitted Indebtedness by the Company;
(viii) Indebtedness arising from the honoring by a bank or
other financial institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts) drawn
against insufficient funds in the ordinary course of business;
provided, however, that such Indebtedness is extinguished within five
Business Days of incurrence;
(ix) Indebtedness of the Company or any of its Restricted
Subsidiaries represented by letters of credit for the account of the
Company or such Restricted Subsidiary, as the case may be, in order to
provide security for workers' compensation claims, payment obligations
in connection with self-insurance or similar requirements in the
ordinary course of business;
(x) Refinancing Indebtedness;
(xi) Capitalized Lease Obligations and Purchase Money
Indebtedness of the Company and its Restricted Subsidiaries incurred
in the ordinary course of business not to exceed $20.0 million at any
one time outstanding;
(xii) Indebtedness incurred by a Non-Domestic Restricted
Subsidiary in an aggregate principal amount at any time outstanding
not to exceed $20.0 million;
(xiii) Investments permitted by clause (x) of the definition
of "Permitted Investments";
(xiv) guarantees of Indebtedness otherwise permitted under
this Indenture; and
(xv) additional Indebtedness of the Company and its Restricted
Subsidiaries in an aggregate principal amount not to exceed $15.0
million at any one time outstanding.
"Permitted Investments" means (i) Investments by the Company or any
Restricted Subsidiary of the Company in any Person that is or will become
immediately after such Investment a Wholly Owned Restricted Subsidiary of the
Company or that will merge or consolidate into the Company or a Wholly Owned
Restricted Subsidiary of the Company, (ii) Investments in the Company by any
Restricted Subsidiary of the Company; provided that any Indebtedness evidencing
such Investment is unsecured and subordinated, pursuant to a written agreement,
to the Company's obligations under the Notes and this Indenture, (iii)
investments in cash and Cash Equivalents, (iv) loans and advances to employees,
officers and directors of the Company and its Restricted Subsidiaries in the
ordinary course of business for bona fide business purposes not in excess of
$2.0 million at any one time outstanding, (v) Investments in Permitted Joint
Ventures including Permitted Joint Ventures which are also Restricted
Subsidiaries, (vi) Currency Agreements and Interest Swap Obligations entered
into in the ordinary course of the Company's or its Restricted Subsidiaries'
businesses and otherwise in compliance with this Indenture, (vii) Investments in
securities of trade creditors or customers received pursuant to any plan of
reorganization or similar arrangement upon the bankruptcy or insolvency of such
trade creditors or customers or in good faith settlement of delinquent
obligations of such trade creditors or customers, (viii) Investments made by the
Company or its Restricted Subsidiaries as a result of consideration received in
connection with an Asset Sale made in compliance with Section 4.12 hereof, (ix)
obligations of one or more officers or other employees of the Company or any of
its Restricted Subsidiaries in connection with such officers' or employees'
acquisition of shares of Common Stock of the Company so long as no cash is paid
by the Company or any of its Restricted Subsidiaries to such officers or
employees in connection with this acquisition of any such obligations, (x)
guarantees of Indebtedness otherwise permitted under this Indenture, and (xi)
additional Investments not to exceed $15.0 million at any one time outstanding.
"Permitted Joint Venture" means any joint venture arrangement (which may be
structured as a corporation, partnership, trust, limited liability company or
any other Person) if (a) no Affiliate of the Company or a Restricted Subsidiary
(other than another Restricted Subsidiary of the Company) has an investment in
such Person, (b) such Person is engaged in the same or a similar line of
business as the Company and its Subsidiaries were engaged in on the date of this
Indenture (or any reasonable extensions or expansions thereof or any business
ancillary thereto or supportive thereof), (c) the Company and/or any of its
Restricted Subsidiaries at all times owns at least 45% of the total outstanding
shares of Capital Stock of such Person entitled to participate in distributions
in respect of the earnings, sale or liquidation of such Person, (d) immediately
after giving effect to such Investment on a pro forma basis (to give effect to
the contribution of any property or assets to such Person or Indebtedness
incurred to fund such Investment or otherwise), the Company could incur at least
$1.00 of additional Indebtedness (other than Permitted Indebtedness) pursuant to
Section 4.12 hereof, and (e) no default with respect to any Indebtedness of such
Person or any Subsidiary of such Person (including any right which the holders
thereof may have to take enforcement action against such Person) would permit
(upon notice, lapse of time or both) any holder of any Indebtedness of the
Company or its Restricted Subsidiaries to declare a default on such Indebtedness
or cause the payment thereof to be accelerated or payable prior to its final
scheduled maturity. If, at any time, a Permitted Joint Venture fails to comply
with clauses (a) through (e) above, such Permitted Joint Venture shall
constitute an Investment and must comply with the covenant in Section 4.10
hereof (but only with respect to the Company's percentage ownership in such
Permitted Joint Venture).
"Permitted Liens" means the following types of Liens:
(i) Liens for taxes, assessments or governmental charges or
claims either (A) not delinquent or (B) contested in good faith by
appropriate proceedings and as to which the Company or its Restricted
Subsidiaries shall have set aside on its books such reserves as may be
required pursuant to GAAP;
(ii) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen and other
Liens imposed by law incurred in the ordinary course of business for
sums not yet delinquent or being contested in good faith, if such
reserve or other appropriate provision, if any, as shall be required
by GAAP shall have been made in respect thereof;
(iii) Liens incurred or deposits made in the ordinary course
of business in connection with workers' compensation, unemployment
insurance and other types of social security, including any Lien
securing letters of credit issued in the ordinary course of business
consistent with past practice in connection therewith, or to secure
the performance of tenders, statutory obligations, surety and appeal
bonds, bids, leases, government contracts, performance and return-of-
money bonds and other similar obligations (exclusive of obligations
for the payment of borrowed money);
(iv) judgment Liens not giving rise to an Event of Default;
(v) easements, rights-of-way, zoning restrictions and other
similar charges or encumbrances in respect of real property not
interfering in any material respect with the ordinary conduct of the
business of the Company or any of its Restricted Subsidiaries;
(vi) any interest or title of a lessor under any Capitalized
Lease Obligation; provided that such Liens do not extend to any
property or assets which is not leased property subject to such
Capitalized Lease Obligation;
(vii) Liens incurred to secure Purchase Money Indebtedness to
finance property or assets of the Company or any Restricted Subsidiary
of the Company acquired in the ordinary course of business; provided,
however, that (A) the related Purchase Money Indebtedness shall not
exceed the cost of such property or assets and shall not be secured by
any property or assets of the Company or any Restricted Subsidiary of
the Company other than the property and assets so acquired and (B) the
Lien securing such Indebtedness shall be created within 90 days of
such acquisition;
(viii) Liens upon specific items of inventory or other goods
and proceeds of any Person securing such Person's obligations in
respect of bankers' acceptances issued or created for the account of
such Person to facilitate the purchase, shipment or storage of such
inventory or other goods;
(ix) Liens securing reimbursement obligations with respect to
commercial letters of credit which encumber documents and other
property relating to such letters of credit and products and proceeds
thereof;
(x) Liens encumbering deposits made to secure obligations
arising from statutory, regulatory, contractual, or warranty
requirements of the Company or any of its Restricted Subsidiaries,
including rights of offset and set-off;
(xi) Liens securing Interest Swap Obligations which Interest Swap
Obligations relate to Indebtedness that is otherwise permitted under
this Indenture;
(xii) Liens securing Indebtedness under Currency Agreements;
(xiii) Liens placed upon any assets of a Non-Domestic
Restricted Subsidiary of the Company to secure Indebtedness permitted
to be incurred by such Non-Domestic Restricted Subsidiary under this
Indenture;
(xiv) any lease or sublease to a third party not interfering
in any material respect with the business of the Company and its
Restricted Subsidiaries; and
(xv) Liens securing Acquired Indebtedness incurred in accordance
with Section 4.12 of this Indenture; provided that (A) such Liens
secured such Acquired Indebtedness at the time of and prior to the
incurrence of such Acquired Indebtedness by the Company or a
Restricted Subsidiary of the Company and were not granted in
connection with, or in anticipation of, the incurrence of such
Acquired Indebtedness by the Company or a Restricted Subsidiary of the
Company and (B) such Liens do not extend to or cover any property or
assets of the Company or of any of its Restricted Subsidiaries other
than the property or assets that secured the Acquired Indebtedness
prior to the time such Indebtedness became Acquired Indebtedness of
the Company or a Restricted Subsidiary of the Company and are no more
favorable to the lienholders than those securing the Acquired
Indebtedness prior to the incurrence of such Acquired Indebtedness by
the Company or a Restricted Subsidiary of the Company.
"Person" means an individual, partnership, corporation, limited liability
company, unincorporated organization, trust or joint venture, or a governmental
agency or political subdivision thereof.
"Physical Notes" has the meaning provided in Section 2.01.
"Preferred Stock" of any Person means any Capital Stock of such Person that
has preferential rights to any other Capital Stock of such Person with respect
to dividends or redemptions or upon liquidation.
"principal" of any Indebtedness (including the Notes) means the principal
amount of such Indebtedness plus the premium, if any, on such Indebtedness.
"Private Exchange Notes" has the meaning set forth in the Registration
Rights Agreement.
"Private Placement Legend" means the legend initially set forth on the
Initial Notes and the Private Exchange Notes in the form set forth in Section
2.15.
"pro forma" means, with respect to any calculation made or required to be
made pursuant to the terms of this Indenture, a calculation in accordance with
Article 11 of Regulation S-X under the Securities Act, as determined by the
Board of Directors of the Company in consultation with its independent public
accountants.
"Public Equity Offering" means an underwritten public offering of Qualified
Capital Stock of the Company pursuant to a registration statement filed with the
Commission in accordance with the Securities Act.
"Purchase Money Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries incurred in the normal course of business for the
purpose of financing all or any part of the purchase price, or the cost of
installation, construction or improvement, of property.
"Qualified Capital Stock" means any Capital Stock that is not Disqualified
Capital Stock.
"Qualified Institutional Buyer" or "QIB" shall have the meaning specified
in Rule 144A under the Securities Act.
"Record Date" means the Record Date specified in the Notes, whether or not
a Legal Holiday.
"Redemption Date," when used with respect to, any Note to be redeemed,
means the date fixed for such redemption pursuant to this Indenture and the
Notes.
"Redemption Price," when used with respect to any Note to be redeemed,
means the price fixed for such redemption, including principal and premium, if
any, pursuant to this Indenture and the Notes.
"Reference Date" has the meaning set forth in Section 4.10.
"Refinance" means, in respect of any security or Indebtedness, to
refinance, extend, renew, refund, repay, prepay, redeem, defease or retire, or
to issue a security or Indebtedness in exchange or replacement for, such
security or Indebtedness in whole or in part. "Refinanced" and "Refinancing"
shall have correlative meanings.
"Refinancing Indebtedness" means any Refinancing by the Company or any
Restricted Subsidiary of the Company of Indebtedness incurred in accordance with
Section 4.12 hereof (other than pursuant to clause (ii), (iv), (v), (vi), (vii),
(viii), (ix) or (xi) of the definition of "Permitted Indebtedness"), in each
case that does not (1) result in an increase in the aggregate principal amount
of Indebtedness of such Person as of the date of such proposed Refinancing (plus
the amount of any interest and premium required to be paid under the terms of
the instrument governing such Indebtedness and plus the amount of reasonable
fees and expenses incurred by the Company or such Restricted Subsidiaries, as
the case may be, in connection with such Refinancing) except to the extent that
any such increase in Indebtedness is otherwise permitted by this Indenture or
(2) create Indebtedness with (A) a Weighted Average Life to Maturity that is
less than the Weighted Average Life to Maturity of the Indebtedness being
Refinanced or (B) a final maturity earlier than the final maturity of the
Indebtedness being Refinanced; provided that (x) if such Indebtedness being
Refinanced is Indebtedness of the Company, then such Refinancing Indebtedness
shall be Indebtedness solely of the Company and (y) if such Indebtedness being
Refinanced is subordinate or junior to the Notes, then such Refinancing
Indebtedness shall be subordinate to the Notes at least to the same extent and
in the same manner as the Indebtedness being Refinanced.
"Registrar" has the meaning provided in Section 2.03.
"Registration Rights Agreement" means the Registration Rights Agreement
dated as of the Issue Date among the Company, the Subsidiary Guarantors and the
Initial Purchasers.
"Regulation S" means Regulation S under the Securities Act.
"Replacement Assets" has the meaning provided in Section 4.15.
"Representative" means the indenture trustee or other trustee, agent or
representative in respect of any Designated Senior Debt; provided that if, and
for so long as, any Designated Senior Debt lacks such a representative, then the
Representative for such Designated Senior Debt shall at all times constitute the
holders of a majority in outstanding principal amount of such Designated Senior
Debt in respect of any Designated Senior Debt or such lesser percentage as shall
be permitted to act on behalf of the holders of such Designated Senior Debt
pursuant to the instrument governing such Designated Senior Debt.
"Restricted Payment" shall have the meaning set forth in Section 4.10.
"Restricted Security" has the meaning assigned to such term in Rule
144(a)(3) under the Securities Act; provided, however, that the Trustee shall be
entitled to request and conclusively rely on an Opinion of Counsel with respect
to whether any Note constitutes a Restricted Security.
"Restricted Subsidiary" of any Person means any Subsidiary of such Person
which at the time of determination is not an Unrestricted Subsidiary; provided
that each Permitted Joint Venture which is a Subsidiary shall be treated as a
Restricted Subsidiary.
"Revocation" has the meaning set forth in Section 4.19.
"Rule 144A" means Rule 144A under the Securities Act.
"Sale and Leaseback Transaction" means any direct or indirect arrangement
with any Person or to which any such Person is a party, providing for the
leasing to the Company or a Restricted Subsidiary of any property, whether owned
by the Company or any Restricted Subsidiary at the Issue Date or later acquired,
which has been or is to be sold or transferred by the Company or such Restricted
Subsidiary to such Person or to any other Person from whom funds have been or
are to be advanced by such Person on the security of such property.
"S&P" means Standard & Poor's Rating Services, a division of The McGraw
Hill Companies, Inc., and its successors.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"Senior Debt" means the principal of, premium, if any, and interest
(including any interest accruing subsequent to the filing of a petition of
bankruptcy at the rate provided for in the documentation with respect thereto,
whether or not such interest is an allowed claim under applicable law) on any
Indebtedness of the Company, whether outstanding on the Issue Date or thereafter
created, incurred or assumed, unless, in the case of any particular
Indebtedness, the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly provides that such Indebtedness shall
not be senior in right of payment to the Notes. Without limiting the generality
of the foregoing, "Senior Debt" shall also include the principal of, premium, if
any, interest (including any interest accruing subsequent to the filing of a
petition of bankruptcy at the rate provided for in the documentation with
respect thereto, whether or not such interest is an allowed claim under
applicable law) on, and all other amounts owing in respect of, (x) all monetary
obligations of every nature of the Company under the Amended Credit Facility,
including, without limitation, obligations to pay principal and interest,
reimbursement obligations under letters of credit, fees, expenses and
indemnities, (y) all Interest Swap Obligations and (z) all obligations under
Currency Agreements, in each case whether outstanding on the Issue Date or
thereafter incurred. Notwithstanding the foregoing, "Senior Debt" shall not
include (i) any Indebtedness of the Company to a Subsidiary of the Company or
any Affiliate of the Company or any of such Affiliate's Subsidiaries, (ii)
Indebtedness to, or guaranteed on behalf of, any shareholder, director, officer
or employee of the Company or any Subsidiary of the Company (including, without
limitation, amounts owed for compensation), (iii) Indebtedness to trade
creditors and other amounts incurred in connection with obtaining goods,
materials or services, (iv) Indebtedness represented by Disqualified Capital
Stock, (v) any liability for federal, state, local or other taxes owed or owing
by the Company, (vi) that portion of any Indebtedness incurred in violation of
Section 4.12 of this Indenture (but, as to any such obligation, no such
violation shall be deemed to exist for purposes of this clause (vi) if the
holder(s) of such obligation or their representative and the Trustee shall have
received an Officers' Certificate of the Company to the effect that the
incurrence of such Indebtedness does not (or, in the case of revolving credit
Indebtedness, that the incurrence of the entire committed amount thereof at the
date on which the initial borrowing thereunder is made would not) violate such
Section 4.12 of this Indenture), (vii) that portion of any Indebtedness which,
when incurred and without respect to any election under Section 1111(b) of Title
11, United States Code, is without recourse to the Company and (viii) that
portion of any Indebtedness which is, by its express terms, subordinated in
right of payment to any other Indebtedness of the Company.
"Significant Subsidiary" shall have the meaning set forth in Rule 1.02(w)
of Regulation S-X under the Securities Act.
"Subsidiary", with respect to any Person, means (i) any corporation of
which the outstanding Capital Stock having at least a majority of the votes
entitled to be cast in the election of directors under ordinary circumstances
shall at the time be owned, directly or indirectly, by such Person or (ii) any
other Person of which at least a majority of the voting interest under ordinary
circumstances is at the time, directly or indirectly, owned by such Person.
"Subsidiary Guarantor" means (i) each of the Company's Wholly Owned
Restricted Subsidiaries (other than Non-Domestic Restricted Subsidiaries) as of
the Issue Date, and (ii) each of the Company's Restricted Subsidiaries that in
the future executes a supplemental indenture in which such Restricted Subsidiary
agrees to be bound by the terms of this Indenture as a Subsidiary Guarantor;
provided, however, that any Subsidiary acquired after the Issue Date which is
prohibited from entering into a Guarantee pursuant to restrictions contained in
any debt instrument or other agreement in existence at the time such Subsidiary
was so acquired and not entered into in anticipation or contemplation of such
acquisition shall not be required to become a Subsidiary Guarantor so long as
any such restriction is in existence and to the extent of any such restriction;
provided, further, that if any Subsidiary Guarantor is released from its
guarantee of the outstanding Indebtedness of the Company under the Amended
Credit Facility and the pledge by it, directly or indirectly, of any of its
assets as security for such Indebtedness at a time when no Default or Event of
Default has occurred and is continuing such Subsidiary Guarantor shall be
automatically released from its obligations as a Subsidiary Guarantor and, from
and after such date, such Subsidiary Guarantor shall cease to constitute a
Subsidiary Guarantor; provided, further, that any Person constituting a
Subsidiary Guarantor as described above shall cease to constitute a Subsidiary
Guarantor when its respective Guarantee is released in accordance with the terms
of this Indenture.
"Surviving Entity" shall have the meaning set forth in Section 5.01.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. 77aaa-77bbbb), as
amended, as in effect on the date of this Indenture, except as otherwise
provided in Section 9.03.
"Trust Officer" means any Officer or assistant officer of the Trustee
assigned by the Trustee to administer this Indenture, or in the case of a
successor trustee, an officer assigned to the department, division or group
performing the corporation trust work of such successor and assigned to
administer this Indenture.
"Trustee" means the party named as such in this Indenture until a successor
replaces it in accordance with the provisions of this Indenture and thereafter
means such successor.
"Unrestricted Subsidiary" of any Person means (i) any Subsidiary of such
Person that at the time of determination shall be or continue to be designated
an Unrestricted Subsidiary by the Board of Directors of such Person in the
manner provided below and (ii) any Subsidiary of an Unrestricted Subsidiary.
The Board of Directors of such Person may designate any Subsidiary other than a
Subsidiary which constitutes a Permitted Joint Venture (including any newly
acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary unless
such Subsidiary owns any Capital Stock of, or owns or holds any Lien on any
property of, the Company or any other Subsidiary of the Company that is not a
Subsidiary of the Subsidiary to be so designated; provided that (x) the Company
certifies to the Trustee that such designation complies with the limitation set
out in Section 4.10 hereof and (y) each Subsidiary to be so designated and each
of its Subsidiaries has not at the time of designation, and does not thereafter,
create, incur, issue, assume, guarantee or otherwise become directly or
indirectly liable with respect to any Indebtedness pursuant to which the lender
has recourse to any of the assets of the Company or any of its Restricted
Subsidiaries. The Board of Directors may designate any Unrestricted Subsidiary
to be a Restricted Subsidiary only if (x) immediately after giving effect to
such designation, the Company is able to incur at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness) in compliance with Section 4.12
hereof and (y) immediately before and immediately after giving effect to such
designation, no Default or Event of Default shall have occurred and be
continuing. Any such designation by the Board of Directors shall be evidenced
to the Trustee by promptly filing with the Trustee a copy of the Board
Resolution giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing provisions.
"U.S. Government Obligations" mean direct obligations of, and obligations
guaranteed by, the United States of America for the payment of which the full
faith and credit of the United States of America is pledged.
"U.S. Legal Tender" means such coin or currency of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing (a) the then outstanding
aggregate principal amount of such Indebtedness into (b) the sum of the total of
the products obtained by multiplying (i) the amount of each then remaining
installment, sinking fund, serial maturity or other required payment of
principal, including payment at final maturity, in respect thereof, by (ii) the
number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.
"Wholly Owned Restricted Subsidiary" of any Person means any Restricted
Subsidiary of such Person of which all the outstanding voting securities (other
than in the case of a foreign Restricted Subsidiary, directors' qualifying
shares or an immaterial amount of shares required to be owned by other Persons
pursuant to applicable law) are owned by such Person or any Wholly Owned
Restricted Subsidiary of such Person.
Section 1.02. Incorporation by Reference of TIA.
Whenever this Indenture refers to a provision of the TIA, such provision is
incorporated by reference in, and made a part of, this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Notes.
"indenture security holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the Indenture securities means the Company or any other
obligor on the Notes.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule and
not otherwise defined herein have the meanings assigned to them therein.
Section 1.03. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP as of the date of any
determination;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the
plural include the singular;
(5) "herein," "hereof" and other words of similar import refer
to this Indenture as a whole and not to any particular Article,
Section or other subdivision; and
(6) any reference to a statute, law or regulation means that
statute, law or regulation as amended and in effect from time to time
and includes any successor statute, law or regulation; provided,
however, that any reference to the Bankruptcy Law shall mean the
Bankruptcy Law as applicable to the relevant case.
ARTICLE TWO
THE NOTES
Section 2.01. Form and Dating.
The Initial Notes, the notation thereon relating to the Guarantees, and the
Trustee's certificate of authentication relating thereto shall be substantially
in the form of Exhibit A. The Exchange Notes, the notation thereon relating to
the Guarantees, and the Trustee's certificate of authentication relating thereto
shall be substantially in the form of Exhibit B. The Notes may have notations,
legends or endorsements required by law, stock exchange rule or depository rule
or usage. The Company and the Trustee shall approve the form of the Notes and
any notation, legend or endorsement on them. If required, the Notes may bear
the appropriate legend regarding any original issue discount for federal income
tax purposes. Each Note shall be dated the date of its issuance and shall show
the date of its authentication. Each Note shall have an executed Guarantee from
each of the Subsidiary Guarantors endorsed thereon or attached thereto
substantially in the form of Exhibit E hereto.
The terms and provisions contained in the Notes, annexed hereto as Exhibits
A and B, shall constitute, and are hereby expressly made, a part of this
Indenture and, to the extent applicable, the Company, the Subsidiary Guarantors
and the Trustee, by their execution and delivery of this Indenture, expressly
agree to such terms and provisions and to be bound thereby.
Notes offered and sold in reliance on Rule 144A, Notes offered and sold to
institutional "accredited investors" (as defined in Rule 501(a)(1), (2), (3) or
(7) under the Securities Act) and Notes offered and sold in reliance on
Regulation S shall be issued initially in the form of one or more permanent
global Notes in registered form, substantially in the form set forth in Exhibit
A (the "Global Note"), deposited with the Trustee, as custodian for the
Depository, duly executed by the Company (and having an executed Guarantee from
each of the Subsidiary Guarantors endorsed thereon) and authenticated by the
Trustee as hereinafter provided and shall bear all the legends set forth in
Section 2.15. The aggregate principal amount of the Global Note may from time
to time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for the Depository, as hereinafter provided.
Notes issued in exchange for interests in a Global Note pursuant to Section
2.16 and Notes offered and sold in reliance on any other exemption from
registration under the Securities Act other than as described in the preceding
paragraph shall be issued in the form of permanent certificated Notes in
registered form in substantially the form set forth in Exhibit A (the "Physical
Notes") and shall bear the first legend set forth in Section 2.15.
All Notes offered and sold in reliance on Regulation S shall remain in the
form of a Global Note until the consummation of the Exchange Offer pursuant to
the Registration Rights Agreement; provided, however, that all of the time
periods specified in the Registration Rights Agreement to be complied with by
the Company and the Subsidiary Guarantors have been so complied with.
Section 2.02. Execution and Authentication; Aggregate
Principal Amount.
Two Officers, or an Officer and an Assistant Secretary, of the Company and
each Subsidiary Guarantor shall sign, or one Officer or an Assistant Secretary
(each of whom shall, in each case, have been duly authorized by all requisite
corporate actions) shall attest to, the Notes for the Company and the Guarantees
for the Subsidiary Guarantors, by manual or facsimile signature.
If an Officer or Assistant Secretary whose signature is on a Note or a
Guarantee, as the case may be, was an Officer or Assistant Secretary at the time
of such execution but no longer holds that office or position at the time the
Trustee authenticates the Note, the Note shall nevertheless be valid.
A Note shall not be valid until an authorized signatory of the Trustee
manually signs the certificate of authentication on the Note. The signature
shall be conclusive evidence that the Note has been authenticated under this
Indenture.
The Trustee shall authenticate (i) Initial Notes (upon receipt of an
Authentication Order from the Company signed by its President) for original
issue in the aggregate principal amount not to exceed $200,000,000 in one or
more series, (ii) Private Exchange Notes from time to time only in exchange for
a like principal amount of Initial Notes and (iii) Exchange Notes from time to
time only in exchange for (A) a like principal amount of Initial Notes or (B) in
an aggregate principal amount of not more than the excess of $200,000,000 over
the sum of the aggregate principal amount of (x) Initial Notes then outstanding,
(y) Private Exchange Notes then outstanding and (z) Exchange Notes issued in
accordance with (iii)(A) above, in each case upon a written order of the Company
in the form of an Officers' Certificate of the Company. Each such written order
shall specify the amount of Notes to be authenticated and the date on which the
Notes are to be authenticated, whether the Notes are to be Initial Notes,
Private Exchange Notes or Exchange Notes and whether the Notes are to be issued
as Physical Notes or Global Notes or such other information as the Trustee may
reasonably request. In addition, with respect to authentication pursuant to
clause (iii) of the first sentence of this paragraph, the first such written
order from the Company shall be accompanied by an Opinion of Counsel of the
Company in a form reasonably satisfactory to and addressed to the Trustee
stating that the issuance of the Exchange Notes does not give rise to an Event
of Default, complies with this Indenture and has been duly authorized by the
Company. The aggregate principal amount of Notes outstanding at any time may
not exceed $200,000,000, except as provided in Sections 2.07 and 2.08.
In the event that the Company shall issue and the Trustee shall
authenticate any Notes issued under this Indenture subsequent to the Issue Date
pursuant to clauses (i) and (iii) of the first sentence of the immediately
preceding paragraph, the Company shall use its reasonable efforts to obtain the
same "CUSIP" number for such Notes as is printed on the Notes outstanding at
such time; provided, however, that if any series of Notes issued under this
Indenture subsequent to the Issue Date is determined, pursuant to an Opinion of
Counsel of the Company in a form reasonably satisfactory to and addressed to the
Trustee to be a different class of security than the Notes outstanding at such
time for federal income tax purposes, the Company may obtain a "CUSIP" number
for such Notes that is different than the "CUSIP" number printed on the Notes
then outstanding.
Notwithstanding the foregoing, all Notes issued under this Indenture shall
vote and consent together on all matters (as to which any of such Notes may vote
or consent) as one class and no series of Notes will have the right to vote or
consent as a separate class on any matter.
The Trustee may appoint an authenticating agent (the "Authenticating
Agent") reasonably acceptable to the Company to authenticate Notes. Unless
otherwise provided in the appointment, an Authenticating Agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such Authenticating
Agent. An Authenticating Agent has the same rights as an Agent to deal with the
Company or with any Affiliate of the Company.
The Notes shall be issuable in fully registered form only, without coupons,
in denominations of $1,000 and any integral multiple thereof.
Section 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency (which shall be located in
the Borough of Manhattan in the City of New York, State of New York or in
Baltimore, Maryland) where (a) Notes may be presented or surrendered for
registration of transfer or for exchange ("Registrar"), (b) Notes may be
presented or surrendered for payment ("Paying Agent") and (c) notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served. The Registrar shall keep a register of the Notes and of their transfer
and exchange. The Company, upon prior written notice to the Trustee, may have
one or more co-Registrars and one or more additional paying agents reasonably
acceptable to the Trustee. The term "Paying Agent" includes any additional
Paying Agent. The Company may act as its own Paying Agent, except that for the
purposes of payments on the Notes pursuant to Sections 4.14 and 4.15, neither
the Company nor any Affiliate of the Company may act as Paying Agent.
The Company shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture, which agreement shall incorporate the provisions
of the TIA and implement the provisions of this Indenture that relate to such
Agent. The Company shall notify the Trustee, in advance, of the name and
address of any such Agent. If the Company fails to maintain a Registrar or
Paying Agent, or fails to give the foregoing notice, the Trustee shall act as
such and shall be entitled to appropriate compensation in accordance with
Section 7.07.
The Company initially appoints the Trustee as Registrar, Paying Agent and
agent for service of demands and notices in connection with the Notes, until
such time as the Trustee has resigned or a successor has been appointed. Any of
the Registrar, the Paying Agent or any other agent may resign upon 30 days'
notice to the Company.
Section 2.04. Paying Agent To Hold Assets in Trust.
The Company shall require each Paying Agent other than the Trustee to agree
in writing that such Paying Agent shall hold in trust for the benefit of the
Holders or the Trustee all assets held by the Paying Agent for the payment of
principal of, premium, if any, or interest on, the Notes (whether such assets
have been distributed to it by the Company or any other obligor on the Notes),
and the Company and the Paying Agent shall notify the Trustee of any Default by
the Company (or any other obligor on the Notes) in making any such payment. The
Company at any time may require a Paying Agent to distribute all assets held by
it to the Trustee and account for any assets disbursed and the Trustee may at
any time during the continuance of any payment Default, upon written request to
a Paying Agent, require such Paying Agent to distribute all assets held by it to
the Trustee and to account for any assets distributed. Upon distribution to the
Trustee of all assets that shall have been delivered by the Company to the
Paying Agent, the Paying Agent shall have no further liability for such assets.
Section 2.05. Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
the Holders and shall otherwise comply with TIA 312(a). If the Trustee is not
the Registrar, the Company shall furnish or cause the Registrar to furnish to
the Trustee five (5) Business Days before each Record Date and at such other
times as the Trustee may request in writing a list as of such date and in such
form as the Trustee may reasonably require of the names and addresses of the
Holders, which list may be conclusively relied upon by the Trustee, and the
Company shall otherwise comply with TIA 312(a).
Section 2.06. Transfer and Exchange.
Subject to the provisions of Sections 2.16 and 2.17, when Notes are
presented to the Registrar or a co-Registrar with a request to register the
transfer of such Notes or to exchange such Notes for an equal principal amount
of Notes of other authorized denominations, the Registrar or co-Registrar shall
register the transfer or make the exchange as requested if its requirements for
such transaction are met; provided, however, that the Notes presented or
surrendered for registration of transfer or exchange shall be duly endorsed or
accompanied by a written instrument of transfer in form satisfactory to the
Company, the Trustee and the Registrar or co-Registrar, duly executed by the
Holder thereof or his attorney duly authorized in writing. To permit
registration of transfers and exchanges, the Company shall execute and the
Trustee shall authenticate Notes (and each of the Subsidiary Guarantors shall
execute a Guarantee thereon). No service charge shall be made for any
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any transfer tax, fee or similar governmental charge
payable in connection therewith (other than any such transfer taxes or similar
governmental charge payable upon exchanges or transfers pursuant to Sections
2.10, 3.04, 4.14, 4.15 or 9.05, in which event the Company shall be responsible
for the payment of such taxes).
The Registrar or co-Registrar shall not be required to register the
transfer of or exchange of any Note (i) during a period beginning at the opening
of business 15 days before the mailing of a notice of redemption of Notes and
ending at the close of business on the day of such mailing, (ii) selected for
redemption in whole or in part pursuant to Article Three, except the unredeemed
portion of any Note being redeemed in part or (iii) between a Record Date and
the next succeeding Interest Payment Date.
Any Holder of a beneficial interest in a Global Note shall, by acceptance
of such Global Note, agree that transfers of beneficial interests in such Global
Notes may be effected only through a book entry system maintained by the Holder
of such Global Note (or its agent), and that ownership of a beneficial interest
in the Note shall be required to be reflected in a book entry system.
Section 2.07. Replacement Notes.
If a mutilated Note is surrendered to the Trustee or if the Holder of a
Note claims that the Note has been lost, destroyed or wrongfully taken, the
Company shall issue and the Trustee shall authenticate a replacement Note (and
each of the Subsidiary Guarantors shall execute a Guarantee thereon) if the
Trustee's requirements are met. If required by the Trustee or the Company, such
Holder must provide satisfactory evidence of such loss, destruction or taking,
and an indemnity bond or other indemnity of reasonable tenor, sufficient in the
reasonable judgment of the Company, the Subsidiary Guarantors and the Trustee,
to protect the Company, the Subsidiary Guarantors, the Trustee or any Agent from
any loss which any of them may suffer if a Note is replaced. Every replacement
Note shall constitute an obligation of the Company and the Subsidiary
Guarantors. The Company and the Trustee each may charge such Holder for its
expenses in replacing such Note, including reasonable fees and expenses of the
Trustee.
Section 2.08. Outstanding Notes.
Notes outstanding at any time are all the Notes that have been
authenticated by the Trustee except those canceled by it, those delivered to it
for cancellation and those described in this Section as not outstanding.
Subject to the provisions of Section 2.09, a Note does not cease to be
outstanding because the Company or any of its Affiliates holds the Note.
If a Note is replaced pursuant to Section 2.07 (other than a mutilated Note
surrendered for replacement), it ceases to be outstanding unless the Trustee
receives proof satisfactory to it that the replaced Note is held by a bona fide
purchaser. A mutilated Note ceases to be outstanding upon surrender of such
Note and replacement thereof pursuant to Section 2.07.
If on a Redemption Date or the Maturity Date the Paying Agent holds U.S.
Legal Tender or U.S. Government Obligations sufficient to pay all of the
principal, premium, if any, and interest due on the Notes payable on that date
and is not prohibited from paying such money to the Holders thereof pursuant to
the terms of this Indenture, then on and after that date such Notes shall be
deemed not to be outstanding and interest on them shall cease to accrue.
Section 2.09. Treasury Notes.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver, consent or notice, Notes owned by
the Company or an Affiliate of the Company shall be considered as though they
are not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes which a Trust Officer of the Trustee actually knows are so owned
shall be so considered. The Company shall notify the Trustee, in writing, when
it or, to its knowledge, any of its Affiliates repurchases or otherwise acquires
Notes, of the aggregate principal amount of such Notes so repurchased or
otherwise acquired and such other information as the Trustee may reasonably
request and the Trustee shall be entitled to rely thereon.
Section 2.10. Temporary Notes.
Until definitive Notes are ready for delivery, the Company may prepare and
the Trustee shall authenticate temporary Notes and the Subsidiary Guarantors
shall prepare temporary Guarantees thereon upon receipt of a written order of
the Company in the form of an Officers' Certificate. The Officers' Certificate
shall specify the amount of temporary Notes to be authenticated and the date on
which the temporary Notes are to be authenticated. Temporary Notes shall be
substantially in the form of definitive Notes but may have variations that the
Company considers appropriate for temporary Notes and so indicate in the
Officers' Certificate. Without unreasonable delay, the Company shall prepare
and execute, the Trustee shall authenticate, and each of the Subsidiary
Guarantors shall execute a Guarantee on, upon receipt of a written order of the
Company pursuant to Section 2.02, definitive Notes in exchange for temporary
Notes.
Section 2.11. Cancellation.
The Company at any time may deliver Notes to the Trustee for cancellation.
The Registrar and the Paying Agent shall forward to the Trustee any Notes
surrendered to them for transfer, exchange or payment. The Trustee, or at the
direction of the Trustee, the Registrar or the Paying Agent, and no one else,
shall cancel and, at the written direction of the Company, shall dispose of all
Notes surrendered for transfer, exchange, payment or cancellation. Subject to
Section 2.07, the Company may not issue new Notes to replace Notes that it has
paid or delivered to the Trustee for cancellation. If the Company shall acquire
any of the Notes, such acquisition shall not operate as a redemption or
satisfaction of the Indebtedness represented by such Notes unless and until the
same are surrendered to the Trustee for cancellation pursuant to this Section
2.11.
Section 2.12. Defaulted Interest.
The Company will pay interest on overdue principal from time to time on
demand at the rate of interest then borne by the Notes. The Company shall, to
the extent lawful, pay interest on overdue installments of interest (without
regard to any applicable grace periods) from time to time on demand at the rate
of interest then borne by the Notes. Interest will be computed on the basis of
a 360-day year comprised of twelve 30-day months, and, in the case of a partial
month, the actual number of days elapsed.
If the Company defaults in a payment of interest on the Notes, it shall pay
the defaulted interest, plus (to the extent lawful) any interest payable on the
defaulted interest, to the Persons who are Holders on a subsequent special
record date, which special record date shall be the fifteenth day next preceding
the date fixed by the Company for the payment of defaulted interest or the next
succeeding Business Day if such date is not a Business Day. The Company shall
notify the Trustee in writing of the amount of defaulted interest proposed to be
paid on each Note and the date of the proposed payment (a "Default Interest
Payment Date"), and at the same time the Company shall deposit with the Trustee
an amount of money equal to the aggregate amount proposed to be paid in respect
of such defaulted interest or shall make arrangements satisfactory to the
Trustee for such deposit on or prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons entitled
to such defaulted interest as provided in this Section; provided, however, that
in no event shall the Company deposit monies proposed to be paid in respect of
defaulted interest later than 11:00 a.m. New York City time of the proposed
Default Interest Payment Date. At least 15 days before the subsequent special
record date, the Company shall mail (or cause to be mailed) to each Holder, as
of a recent date selected by the Company, with a copy to the Trustee, a notice
that states the subsequent special record date, the payment date and the amount
of defaulted interest, and interest payable on such defaulted interest, if any,
to be paid. Notwithstanding the foregoing, any interest which is paid prior to
the expiration of the 30-day period set forth in Section 6.01(a) shall be paid
to Holders as of the regular record date for the Interest Payment Date for which
interest has not been paid. Notwithstanding the foregoing, the Company may make
payment of any defaulted interest in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Notes may be
listed, and upon such notice as may be required by such exchange.
Section 2.13. CUSIP Numbers.
The Company in issuing the Notes may use one or more "CUSIP" numbers, and,
if so, the Trustee shall use a CUSIP number in notices of redemption or exchange
as a convenience to Holders; provided, however, that no representation is hereby
deemed to be made by the Trustee as to the correctness or accuracy of the CUSIP
number printed in the notice or on the Notes, and that reliance may be placed
only on the other identification numbers printed on the Notes. The Company
shall promptly notify the Trustee of any change in any CUSIP number.
Section 2.14. Deposit of Monies.
Prior to 11:00 a.m. New York City time on each Interest Payment Date,
Maturity Date, Redemption Date, Change of Control Payment Date and Net Proceeds
Offer Payment Date, the Company shall have deposited with the Paying Agent in
immediately available funds money sufficient to make cash payments, if any, due
on such Interest Payment Date, Maturity Date, Redemption Date, Change of Control
Payment Date and Net Proceeds Offer Payment Date, as the case may be, in a
timely manner which permits the Paying Agent to remit payment to the Holders on
such Interest Payment Date, Maturity Date, Redemption Date, Change of Control
Payment Date and Net Proceeds Offer Payment Date, as the case may be.
Section 2.15. Restrictive Legends.
Each Global Note and Physical Note that constitutes a Restricted Security
or is sold in compliance with Regulation S shall bear the following legend (the
"Private Placement Legend") on the face thereof until after the second
anniversary of the later of the Issue Date and the last date on which the
Company or any Affiliate of the Company was the owner of such Note (or any
predecessor security) (or such shorter period of time as permitted by Rule
144(k) under the Securities Act or any successor provision thereunder) (or such
longer period of time as may be required under the Securities Act or applicable
state securities laws in the opinion of counsel for the Company, unless
otherwise agreed by the Company and the Holder thereof):
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY
NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE
ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH BELOW. BY ITS
ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) OR (B) IT IS AN "ACCREDITED INVESTOR" (AS DEFINED IN
RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT (AN
"ACCREDITED INVESTOR")) OR (C) IT IS NOT A U.S. PERSON AND IS
ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
RULE 904 UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT WITHIN
TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR
OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE ISSUER THEREOF OR
ANY SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES
ACT, (C) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED
INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON
ITS BEHALF BY A U.S. BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THIS SECURITY (THE FORM OF WHICH LETTER
CAN BE OBTAINED FROM THE TRUSTEE FOR THIS SECURITY), (D) OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904
UNDER THE SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO EACH
PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO
THE EFFECT OF THIS LEGEND IN CONNECTION WITH ANY TRANSFER OF THIS
SECURITY WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS
SECURITY. IF THE PROPOSED TRANSFEREE IS AN ACCREDITED INVESTOR, THE
HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE
ISSUER SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS
EITHER OF THEM MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS
BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. AS
USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND
"U.S. PERSON" HAVE THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT.
Each Global Note shall also bear the following legend on the face thereof:
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY, OR
BY ANY SUCH NOMINEE OF THE DEPOSITORY, OR BY THE DEPOSITORY OR NOMINEE
OF SUCH SUCCESSOR DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR
DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS
IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF
PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.17 OF THE
INDENTURE GOVERNING THIS NOTE.
Section 2.16. Book-Entry Provisions for Global Security.
(a) The Global Notes initially shall (i) be registered in the name of the
Depository or the nominee of such Depository, (ii) be delivered to the
Depository or its custodian and (iii) bear legends as set forth in Section 2.15.
Members of, or participants in, the Depository ("Agent Members") shall have
no rights under this Indenture with respect to any Global Note held on their
behalf by the Depository, or the Trustee as its custodian, or under the Global
Notes, and the Depository or its nominee may be treated by the Company, the
Trustee and any Agent of the Company or the Trustee as the absolute owner of
such Global Note for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or any Agent of the
Company or the Trustee from giving effect to any written certification, proxy or
other authorization furnished by the Depository or impair, as between the
Depository and its Agent Members, the operation of customary practices governing
the exercise of the rights of a Holder of any Note.
(b) Transfers of a Global Note shall be limited to transfers in whole,
but not in part, to the Depository, its successors or their respective nominees.
Interests of beneficial owners in a Global Note may be transferred or exchanged
for Physical Notes in accordance with the rules and procedures of the Depository
and the provisions of Section 2.17. In addition, Physical Notes shall be
transferred to all beneficial owners in exchange for their beneficial interests
in a Global Note if (i) the Depository notifies the Company that it is unwilling
or unable to continue as Depository for the Global Notes and a successor
Depository is not appointed by the Company within 90 days of such notice or (ii)
an Event of Default has occurred and is continuing and the Registrar has
received a written request from the Depository to issue Physical Notes.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in a Global Note to beneficial owners pursuant to paragraph
(b), the Registrar shall (if one or more Physical Notes are to be issued)
reflect on its books and records the date and a decrease in the principal amount
of such Global Note in an amount equal to the principal amount of the beneficial
interest in the Global Note to be transferred, and the Company shall execute,
each of the Subsidiary Guarantors shall execute a Guarantee on, and the Trustee
shall authenticate and deliver, one or more Physical Notes of like tenor and
amount.
(d) In connection with the transfer of an entire Global Note to
beneficial owners pursuant to paragraph (b), such Global Note shall be deemed to
be surrendered to the Trustee for cancellation, and the Company shall execute,
each of the Subsidiary Guarantors shall execute a Guarantee on, and the Trustee
shall authenticate and deliver, to each beneficial owner identified by the
Depository in exchange for its beneficial interest in the Global Note, an equal
aggregate principal amount of Physical Notes of authorized denominations
registered in the names of such beneficial owners.
(e) Any Physical Note constituting a Restricted Security delivered in
exchange for an interest in a Global Note pursuant to paragraph (b) or (c)
shall, except as otherwise provided by paragraphs (a)(i)(x) and (c) of Section
2.17, bear the Private Placement Legend applicable to the Physical Notes set
forth in Section 2.15.
(f) The Holder of a Global Note may grant proxies and otherwise authorize
any Person, including Agent Members and Persons that may hold interests through
Agent Members, to take any action which a Holder is entitled to take under this
Indenture or the Notes.
Section 2.17. Special Transfer Provisions.
(a) Transfers to Non-QIB Institutional Accredited Investors and Non-U.S.
Persons. The following provisions shall apply with respect to the registration
of any proposed transfer of a Note constituting a Restricted Security to any
Institutional Accredited Investor which is not a QIB or to any Non-U.S. Person:
(i) the Registrar shall register the transfer of any Note constituting a
Restricted Security, whether or not such Note bears the Private Placement
Legend, if (x) the requested transfer is after the second anniversary of the
Issue Date (provided, however, that neither the Company nor any Affiliate of the
Company has held any beneficial interest in such Note, or portion thereof, at
any time on or prior to such second anniversary of the Issue Date) or (y) (1) in
the case of a transfer to an Institutional Accredited Investor which is not a
QIB (excluding Non-U.S. Persons), the proposed transferee has delivered to the
Registrar a certificate substantially in the form of Exhibit C and any legal
opinions and certifications required thereby or (2) in the case of a transfer to
a Non-U.S. Person, the proposed transferor has delivered to the Registrar a
certificate substantially in the form of Exhibit D; and
(ii) if the proposed transferor is an Agent Member holding a beneficial
interest in the Global Note, upon receipt by the Registrar of (x) the
certificate, if any, required by paragraph (i) above and (y) written
instructions given in accordance with the Depository's and the Registrar's
procedures,
whereupon (a) the Registrar shall reflect on its books and records the date
and (if the transfer does not involve a transfer of outstanding Physical Notes)
a decrease in the principal amount of such Global Note in an amount equal to the
principal amount of the beneficial interest in the Global Note to be
transferred, and (b) the Company shall execute, each of the Subsidiary
Guarantors shall execute a Guarantee on, and the Trustee shall authenticate and
deliver one or more Physical Notes of like tenor and amount.
(b) Transfers to QIBs. The following provisions shall apply with respect
to the registration of any proposed transfer of a Note constituting a Restricted
Security to a QIB (excluding transfers to Non-U.S. Persons):
(i) the Registrar shall register the transfer, whether or not such Note
bears the Private Placement Legend, if (x) the requested transfer is after the
second anniversary of the Issue Date; provided, however, that neither the
Company nor any Affiliate of the Company has held any beneficial interest in
such Note, or portion thereof, at any time on or prior to such second
anniversary of the Issue Date or (y) if such transfer is being made by a
proposed transferor who has checked the box provided for on the form of Note
stating, or has otherwise advised the Company and the Registrar in writing, that
the sale has been made in compliance with the provisions of Rule 144A to a
transferee who has signed the certification provided for on the form of Note
stating, or has otherwise advised the Company and the Registrar in writing, that
it is purchasing the Note for its own account or an account with respect to
which it exercises sole investment discretion and that it and any such account
is a QIB within the meaning of Rule 144A, and is aware that the sale to it is
being made in reliance on Rule 144A and acknowledges that it has received such
information regarding the Company as it has requested pursuant to Rule 144A or
has determined not to request such information and that it is aware that the
transferor is relying upon its foregoing representations in order to claim the
exemption from registration provided by Rule 144A; and
(ii) if the proposed transferee is an Agent Member, and the Notes to be
transferred consist of Physical Notes which after transfer are to be evidenced
by an interest in a Global Note, upon receipt by the Registrar of written
instructions given in accordance with the Depository's and the Registrar's
procedures, the Registrar shall reflect on its books and records the date and an
increase in the principal amount of such Global Note in an amount equal to the
principal amount of the Physical Notes to be transferred, and the Trustee shall
cancel the Physical Notes so transferred.
(c) Private Placement Legend. Upon the transfer, exchange or replacement
of Notes not bearing the Private Placement Legend, the Registrar shall deliver
Notes that do not bear the Private Placement Legend. Upon the transfer,
exchange or replacement of Notes bearing the Private Placement Legend, the
Registrar shall deliver only Notes that bear the Private Placement Legend unless
(i) the requested transfer is after the second anniversary of the Issue Date
(provided, however, that neither the Company nor any Affiliate of the Company
has held any beneficial interest in such Note, or portion thereof, prior to or
on the second anniversary of the Issue Date), or (ii) there is delivered to the
Registrar an Opinion of Counsel reasonably satisfactory to the Company and the
Trustee to the effect that neither such legend nor the related restrictions on
transfer are required in order to maintain compliance with the provisions of the
Securities Act.
(d) General. By its acceptance of any Note bearing the Private Placement
Legend, each Holder of such a Note acknowledges the restrictions on transfer of
such Note set forth in this Indenture and in the Private Placement Legend and
agrees that it will transfer such Note only as provided in this Indenture.
The Registrar shall retain copies of all letters, notices and other written
communications received pursuant to Section 2.16 or this Section 2.17. The
Company shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time during the
Registrar's normal business hours upon the giving of reasonable written notice
to the Registrar.
(e) Transfers of Notes Held by Affiliates. Any certificate (i)
evidencing a Note that has been transferred to an Affiliate of the Company
within two years after the Issue Date, as evidenced by a notation on the
Assignment Form for such transfer or in the representation letter delivered in
respect thereof or (ii) evidencing a Note that has been acquired from an
Affiliate (other than by an Affiliate) in a transaction or a chain of
transactions not involving any public offering, shall, until two years after the
last date on which either the Company or any Affiliate of the Company was an
owner of such Note, in each case, bear a legend in substantially the form set
forth in Section 2.15, unless otherwise agreed by the Company (with written
notice thereof to the Trustee).
ARTICLE THREE
REDEMPTION
Section 3.01. Notices to Trustee.
If the Company elects to redeem Notes pursuant to Paragraph 6 of the Notes
and Section 3.03 hereof, it shall notify the Trustee and the Paying Agent in
writing of the Redemption Date and the principal amount of the Notes to be
redeemed.
The Company shall give each notice provided for in this Section 3.01 at
least 15 days before the date that notice of redemption is mailed to Holders
(unless a shorter notice period shall be satisfactory to the Trustee, as
evidenced in a writing signed on behalf of the Trustee), together with an
Officers' Certificate stating that such redemption shall comply with the
conditions contained herein and in the Notes, the Redemption Date, the
redemption price and the principal amount of the Notes to be redeemed.
If the Company is required to make an offer to redeem Notes pursuant to the
provisions of Section 4.14 or 4.15 hereof, it shall furnish to the Trustee at
least 15 days before the date that notice of redemption is mailed to Holders
(unless a shorter notice period shall be satisfactory to the Trustee, as
evidenced in a writing signed on behalf of the Trustee), an Officers'
Certificate setting forth (i) the Section of this Indenture pursuant to which
the redemption shall occur, (ii) the Redemption Date, (iii) the principal amount
of Notes to be redeemed, (iv) the redemption price and (v) a statement to the
effect that (a) the Company or one of its Restricted Subsidiaries has effected
an Asset Sale and the conditions set forth in Section 4.15 have been satisfied
or (b) a Change of Control has occurred and the conditions set forth in Section
4.14 have been satisfied, as applicable.
Section 3.02. Selection of Notes To Be Redeemed.
In the event that less than all of the Notes are to be redeemed at any
time, selection of such Notes for redemption will be made by the Trustee in
compliance with the requirements of the principal national securities exchange,
if any, on which such Notes are listed or, if such Notes are not then listed on
a national securities exchange, on a pro rata basis, by lot or by such other
method as the Trustee shall deem fair and appropriate; provided, however, that
no Notes of a principal amount of $1,000 or less shall be redeemed in part;
provided, further, that if a partial redemption is made with the proceeds of a
Public Equity Offering, selection of the Notes or portions thereof for
redemption shall be made by the Trustee only on a pro rata basis or on as nearly
a pro rata basis as is practicable (subject to DTC procedures), unless such
method is otherwise prohibited. Notice of redemption shall be mailed by first-
class mail at least 30 but not more than 60 days before the Redemption Date to
each Holder of Notes to be redeemed at its registered address. If any Note is
to be redeemed in part only, the notice of redemption that relates to such Note
shall state the portion of the principal amount thereof to be redeemed. A new
Note in a principal amount equal to the unredeemed portion thereof will be
issued in the name of the Holder thereof upon cancellation of the original Note.
On and after the Redemption Date, interest will cease to accrue on Notes or
portions thereof called for redemption as long as the Company has deposited with
the Paying Agent funds in satisfaction of the applicable Redemption Price.
Section 3.03. Optional Redemption.
(a) The Notes will be redeemable, at the Company's option, in whole at
any time or in part from time to time, on and after March 15, 2002, upon not
less than 30 nor more than 60 days' notice, at the following redemption prices
(expressed as percentages of the principal amount thereof) if redeemed during
the twelve-month period commencing on March 15 of the year set forth below,
plus, in each case, accrued and unpaid interest thereon, if any, to the date of
redemption:
Year Percentage
____ __________
2002 104.625%
2003 103.083%
2004 101.542%
2005 and thereafter 100.000%
(b) At any time, or from time to time, on or prior to March 15, 2001, the
Company may, at its option, use the net cash proceeds of one or more Public
Equity Offerings to redeem up to 35% of the aggregate principal amount of Notes
originally issued at a redemption price equal to 109.250% of the principal
amount thereof plus accrued and unpaid interest thereon, if any, to the date of
redemption; provided that at least 65% of the principal amount of Notes
originally issued remains outstanding immediately after any such redemption. In
order to effect the foregoing redemption with the proceeds of any Public Equity
Offering, the Company shall make such redemption not more than 90 days after the
receipt of proceeds of any such Public Equity Offering.
Section 3.04. Notice of Redemption.
At least 30 days but not more than 60 days before the Redemption Date, the
Company shall mail or cause to be mailed a notice of redemption by first class
mail to each Holder of Notes to be redeemed at its registered address, with a
copy to the Trustee and any Paying Agent. At the Company's request, the Trustee
shall give the notice of redemption in the Company's name and at the Company's
expense. The Company shall provide such notices of redemption to the Trustee at
least five days before the intended mailing date. In any case, failure to give
such notice or any defect in the notice to the Holder of any Note shall not
affect the validity of the proceeding for the redemption of any other Note.
Each notice of redemption shall identify (including by any CUSIP number)
the Notes to be redeemed and shall state:
(1) the Redemption Date;
(2) the Redemption Price and the amount of accrued interest, if
any, to be paid;
(3) the name and address of the Paying Agent;
(4) the subparagraph of the Notes pursuant to which such
redemption is being made;
(5) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price plus accrued interest, if
any;
(6) that, unless the Company defaults in making the redemption
payment, interest on Notes or applicable portions thereof called for
redemption ceases to accrue on and after the Redemption Date, and the
only remaining right of the Holders of such Notes is to receive
payment of the redemption price plus accrued interest as of the
Redemption Date, if any, upon surrender to the Paying Agent of the
Notes redeemed;
(7) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the
Redemption Date, and upon surrender of such Note, a new Note or Notes
in the aggregate principal amount equal to the unredeemed portion
thereof will be issued; and
(8) if fewer than all the Notes are to be redeemed, the
identification of the particular Notes (or portion thereof) to be
redeemed, as well as the aggregate principal amount of Notes to be
redeemed and the aggregate principal amount of Notes to be outstanding
after such partial redemption.
The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the purchase
of Notes.
Section 3.05. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.04, such
notice of redemption shall be irrevocable and Notes called for redemption become
due and payable on the Redemption Date and at the Redemption Price plus accrued
interest, if any. Upon surrender to the Trustee or Paying Agent, such Notes
called for redemption shall be paid at the Redemption Price plus accrued
interest thereon to the Redemption Date, but installments of interest, the
maturity of which is on or prior to the Redemption Date, shall be payable to
Holders of record at the close of business on the relevant record dates referred
to in the Notes. Interest shall accrue on or after the Redemption Date and
shall be payable only if the Company defaults in payment of the Redemption
Price.
Section 3.06. Deposit of Redemption Price.
On or before 11:00 a.m. New York City time on the Redemption Date and in
accordance with Section 2.14, the Company shall deposit with the Paying Agent
U.S. Legal Tender sufficient to pay the Redemption Price plus accrued interest,
if any, of all Notes to be redeemed on that date. The Paying Agent shall
promptly return to the Company any U.S. Legal Tender so deposited which is not
required for that purpose, except with respect to monies owed as obligations to
the Trustee pursuant to Article Seven.
Unless the Company fails to comply with the preceding paragraph and
defaults in the payment of such redemption price plus accrued interest, if any,
interest on the Notes to be redeemed will cease to accrue on and after the
applicable Redemption Date, whether or not such Notes are presented for payment.
Section 3.07. Notes Redeemed in Part.
Upon surrender of a Note that is to be redeemed in part, the Trustee shall
authenticate for the Holder a new Note or Notes equal in principal amount to the
unredeemed portion of the Note surrendered.
ARTICLE FOUR
COVENANTS
Section 4.01. Payment of Notes.
(a) The Company shall pay the principal of, premium, if any, and interest
on the Notes on the dates and in the manner provided in the Notes and in this
Indenture.
(b) An installment of principal of or interest on the Notes shall be
considered paid on the date it is due if the Trustee or Paying Agent (other than
the Company or any of its Affiliates) holds, prior to 11:00 a.m. New York City
time on that date, U.S. Legal Tender designated for and sufficient to pay in a
timely manner the installment in full and is not prohibited from paying such
money to the Holders pursuant to the terms of this Indenture or the Notes.
(c) Notwithstanding anything to the contrary contained in this Indenture,
the Company may, to the extent it is required to do so by law, deduct or
withhold income or other similar taxes imposed by the United States of America
from principal or interest payments hereunder.
Section 4.02. Maintenance of Office or Agency.
The Company shall maintain the office or agency required under Section
2.03. The Company shall give prior written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the
Trustee set forth in Section 13.02.
Section 4.03. Corporate Existence.
Except as permitted by Article Five, the Company shall do or shall cause to
be done all things necessary to preserve and keep in full force and effect its
corporate existence and the corporate existence of each of its Restricted
Subsidiaries in accordance with the respective organization documents of the
Company and each such Restricted Subsidiary and the material rights (charter and
statutory) and franchises of the Company and each such Restricted Subsidiary;
provided, however, that the Company shall not be required to preserve, with
respect to itself, any material right or franchise and, with respect to any of
its Restricted Subsidiaries, any such existence, material right or franchise, if
the Board of Directors of the Company shall determine in good faith that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and its Subsidiaries taken as a whole.
Section 4.04. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (i) all material taxes, assessments and
governmental charges (including withholding taxes and any penalties, interest
and additions to taxes) levied or imposed upon the Company or any of its
Subsidiaries or properties of the Company or any of its Subsidiaries and (ii)
all material lawful claims for labor, materials and supplies that, if unpaid,
might by law become a Lien upon the property of the Company or any of its
Subsidiaries; provided, however, that the Company shall not be required to pay
or discharge or cause to be paid or discharged any such tax, assessment, charge
or claim whose amount, applicability or validity is being contested in good
faith by appropriate negotiations or proceedings properly instituted and
diligently conducted for which adequate reserves, to the extent required under
GAAP, have been taken.
Section 4.05. Maintenance of Properties and Insurance.
(a) The Company shall, and shall cause each of its Restricted
Subsidiaries to, maintain all material properties owned by or leased to it and
its Restricted Subsidiaries in good working order, condition and repair and
supplied with all necessary equipment and shall cause to be made all necessary
repairs, renewals, replacements, betterments and improvements thereto, all as in
the judgment of the Company or such Restricted Subsidiary may be necessary so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times; provided, however, that nothing in this
Section shall prevent the Company or any of its Restricted Subsidiaries from
discontinuing the use, operation or maintenance of any of such properties, or
disposing of any of them, if such discontinuance or disposal is, in the judgment
of the Board of Directors of the Company or of the Board of Directors of the
Restricted Subsidiary concerned, desirable in the conduct of the business of the
Company or any of its Restricted Subsidiaries.
(b) The Company shall provide or cause to be provided, for itself and
each of its Restricted Subsidiaries, insurance (including appropriate self-
insurance) against loss or damage of the kinds that, in the good faith judgment
of the Board of Directors of the Company, are adequate and appropriate for the
conduct of the business of the Company and such Restricted Subsidiaries in a
prudent manner, with reputable insurers or with the government of the United
States of America or an agency or instrumentality thereof, in such amounts, with
such deductibles, and by such methods as shall be customary, in the good faith
judgment of the Board of Directors of the Company, for companies similarly
situated in the industry.
Section 4.06. Compliance Certificate; Notice of Default.
(a) The Company shall deliver to the Trustee, within 90 days after the
end of each of the Company's fiscal years, an Officers' Certificate (signed by
the principal executive officer, principal financial officer or principal
accounting officer) stating that a review of its activities and the activities
of its Restricted Subsidiaries during the preceding fiscal year has been made
under the supervision of the signing Officers with a view to determining whether
it has kept, observed, performed and fulfilled its obligations under this
Indenture and further stating, as to each such Officer signing such certificate,
that to the best of such Officer's knowledge the Company during such preceding
fiscal year has kept, observed, performed and fulfilled each and every such
covenant and obligation and no Default or Event of Default occurred during such
year and at the date of such certificate there is no Default or Event of Default
that has occurred and is continuing or, if such signers do know of such Default
or Event of Default, the certificate shall describe the Default or Event of
Default and its status with particularity. The Officers' Certificate shall also
notify the Trustee should the Company elect to change the manner in which it
fixes its fiscal year end.
(b) The annual financial statements delivered pursuant to Section 4.08
shall be accompanied by a written report of the Company's independent certified
public accountants (who shall be a firm of established national reputation)
stating (A) that their audit examination has included a review of the terms of
this Indenture and the form of the Notes as they relate to accounting matters,
and (B) whether, in connection with their audit examination, any Default or
Event of Default has come to their attention and if such a Default or Event of
Default has come to their attention, specifying the nature and period of
existence thereof; provided, however, that, without any restriction as to the
scope of the audit examination, such independent certified public accountants
shall not be liable by reason of any failure to obtain knowledge of any such
Default or Event of Default that would not be disclosed in the course of an
audit examination conducted in accordance with generally accepted auditing
standards.
(c) So long as any of the Notes are outstanding (i) if any Default or
Event of Default has occurred and is continuing or (ii) if any Holder seeks to
exercise any remedy hereunder with respect to a claimed Default under this
Indenture or the Notes, the Company shall promptly deliver to the Trustee by
registered or certified mail or by telegram, telex or facsimile transmission
followed by hard copy by registered or certified mail an Officers' Certificate
specifying such event, notice or other action within five Business Days of its
becoming aware of such occurrence.
Section 4.07. Compliance with Laws.
The Company shall comply, and shall cause each of its Restricted
Subsidiaries to comply, with all applicable statutes, rules, regulations, orders
and restrictions of the United States of America, all states and municipalities
thereof and of any governmental department, commission, board, regulatory
authority, bureau, agency and instrumentality of the foregoing, in respect of
the conduct of their respective businesses and the ownership of their respective
properties, except for such noncompliances as could not singly or in the
aggregate reasonably be expected to have a material adverse effect on the
financial condition, business, prospects or results of operations of the Company
and its Restricted Subsidiaries taken as a whole.
Section 4.08. Reports to Holders.
So long as the Notes are outstanding, the Company will deliver to the
Trustee within 15 days after the filing of the same with the Commission, copies
of the quarterly and annual reports and of the information, documents and other
reports, if any, which the Company is required to file with the Commission
pursuant to Section 13 or 15(d) of the Exchange Act. Notwithstanding that the
Company may not be subject to the reporting requirements of Section 13 or 15(d)
of the Exchange Act, the Company will file with the Commission, to the extent
permitted, and provide the Trustee and Holders with such annual reports and such
information, documents and other reports specified in Sections 13 and 15(d) of
the Exchange Act. The Company will also comply with the other provisions of TIA
314(a).
Section 4.09. Waiver of Stay, Extension or Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law or any usury law or
other law that would prohibit or forgive the Company from paying all or any
portion of the principal of or interest on the Notes as contemplated herein,
wherever enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture; and (to the extent that it may
lawfully do so) the Company hereby expressly waives all benefit or advantage of
any such law, and covenants that it shall not hinder, delay or impede the
execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law had been enacted.
Section 4.10. Limitation on Restricted Payments.
The Company will not, and will not cause or permit any of its Restricted
Subsidiaries to, directly or indirectly, (a) on or in respect of shares of the
Company's Capital Stock to holders of such Capital Stock, declare or pay any
dividend or make any distribution (other than dividends or distributions payable
in Qualified Capital Stock of the Company), (b) purchase, redeem or otherwise
acquire or retire for value any Capital Stock of the Company or any warrants,
rights or options to purchase or acquire shares of any class of such Capital
Stock (other than the exchange of such Capital Stock or warrants, rights or
options to purchase or acquire shares of any class of Capital Stock of the
Company for Qualified Capital Stock of the Company), (c) make any principal
payment on, purchase, defease, redeem, prepay, decrease or otherwise acquire or
retire for value, prior to any scheduled final maturity, scheduled repayment or
scheduled sinking fund payment, any Indebtedness of the Company that is
subordinate or junior in right of payment to the Notes, or (d) make any
Investment (other than Permitted Investments) (each of the foregoing actions set
forth in clauses (a), (b), (c) and (d) being referred to as a "Restricted
Payment"), if at the time of such Restricted Payment or immediately after giving
effect thereto, (i) a Default or an Event of Default shall have occurred and be
continuing or (ii) the Company is not able to incur at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness) in compliance with Section 4.12
of this Indenture or (iii) the aggregate amount of Restricted Payments
(including such proposed Restricted Payment) made subsequent to the Issue Date
(the amount expended for such purposes, if other than in cash, being the fair
market value of such property as determined reasonably and in good faith by the
Board of Directors of the Company) shall exceed the sum of: (v) 50% of the
cumulative Consolidated Net Income (or if cumulative Consolidated Net Income
shall be a loss, minus 100% of such loss) of the Company earned subsequent to
the Issue Date and on or prior to the date the Restricted Payment occurs (the
"Reference Date") (treating such period as a single accounting period); plus (w)
100% of the aggregate net cash proceeds received by the Company from any Person
(other than a Subsidiary of the Company) from the issuance and sale subsequent
to the Issue Date and on or prior to the Reference Date of Qualified Capital
Stock of the Company; plus (x) without duplication of any amounts included in
clause (iii)(w) above, 100% of the aggregate net cash proceeds of any equity
contribution received by the Company from a holder of the Company's Capital
Stock (excluding, in the case of clauses (iii)(w) and (x), any net cash proceeds
from a Public Equity Offering to the extent used to redeem the Notes); plus (y)
an amount equal to the net reduction in Investments in Unrestricted Subsidiaries
resulting from dividends, interest payments, repayments of loans or advances, or
other transfers of cash, in each case, to the Company or to any Wholly Owned
Restricted Subsidiary of the Company from Unrestricted Subsidiaries (but without
duplication of any such amount included in Consolidated Net Income of the
Company), or from redesignations of Unrestricted Subsidiaries as Restricted
Subsidiaries (in each case valued as provided in the definition of
"Investment"), not to exceed, in the case of an Unrestricted Subsidiary, the
amount of Investments previously made by the Company or any Restricted
Subsidiary of the Company in such Unrestricted Subsidiary and which were treated
as a Restricted Payment under this Section 4.10; plus (z) $10.0 million.
Notwithstanding the foregoing, the provisions set forth in the immediately
preceding paragraph do not prohibit: (1) the payment of any dividend or the
consummation of any irrevocable redemption within 60 days after the date of
declaration of such dividend or the giving of such irrevocable redemption notice
if the dividend or redemption would have been permitted on the date of
declaration or the giving of such irrevocable redemption notice; (2) if no
Default or Event of Default shall have occurred and be continuing, the
acquisition of any shares of Capital Stock of the Company, either (i) solely in
exchange for shares of Qualified Capital Stock of the Company or (ii) through
the application of net proceeds of a substantially concurrent sale for cash
(other than to a Subsidiary of the Company) of shares of Qualified Capital Stock
of the Company; (3) if no Default or Event of Default shall have occurred and be
continuing, the acquisition of any Indebtedness of the Company that is
subordinate or junior in right of payment to the Notes either (i) solely in
exchange for shares of Qualified Capital Stock of the Company, or (ii) through
the application of net proceeds of a substantially concurrent sale for cash
(other than to a Subsidiary of the Company) of (A) shares of Qualified Capital
Stock of the Company or (B) Refinancing Indebtedness; and (4) if no Default or
Event of Default shall have occurred and be continuing, repurchases by the
Company of Common Stock of the Company from officers, directors and employees of
the Company or any of its Subsidiaries or their authorized representatives upon
the death, disability or termination of employment of such officers, directors
and employees, in an aggregate amount not to exceed $300,000 in any calendar
year plus the aggregate cash proceeds from any reissuance during such calendar
year of Common Stock by the Company to employees, officers or directors of the
Company and its Subsidiaries plus the aggregate cash proceeds from any payments
on life insurance policies with respect to any employees, officers or directors
of the Company and its Subsidiaries which proceeds are used to purchase the
Common Stock of the Company held by any such employees, officers or directors.
In determining the aggregate amount of Restricted Payments made subsequent to
the Issue Date in accordance with clause (iii) of the immediately preceding
paragraph, amounts expended pursuant to clauses (1), (2)(ii) and (4) shall be
included in such calculation.
Not later than the date of making any Restricted Payment, the Company shall
deliver to the Trustee an Officers' Certificate stating that such Restricted
Payment complies with this Indenture and setting forth in reasonable detail the
basis upon which the required calculations were computed, which calculations may
be based upon the Company's latest available internal quarterly financial
statements.
Section 4.11. Limitations on Transactions with Affiliates.
(a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, enter into or permit to exist any
transaction or series of related transactions (including, without limitation,
the purchase, sale, lease or exchange of any property or the rendering of any
service) with, or for the benefit of, any of its Affiliates (each an "Affiliate
Transaction"), other than (x) Affiliate Transactions permitted under paragraph
(b) below and (y) Affiliate Transactions on terms that are no less favorable
than those that might reasonably have been obtained in a comparable transaction
at such time on an arm's-length basis from a Person that is not an Affiliate of
the Company or such Restricted Subsidiary. All Affiliate Transactions (and each
series of related Affiliate Transactions which are similar or part of a common
plan) involving aggregate payments or other property with a fair market value in
excess of $1.0 million shall be approved by the Board of Directors of the
Company or such Restricted Subsidiary, as the case may be, such approval to be
evidenced by a Board Resolution stating that such Board of Directors has
determined that such transaction complies with the foregoing provisions. If the
Company or any Restricted Subsidiary of the Company enters into an Affiliate
Transaction (or a series of related Affiliate Transactions related to a common
plan) that involves an aggregate fair market value of more than $5.0 million,
the Company or such Restricted Subsidiary, as the case may be, shall, prior to
the consummation thereof, obtain a favorable opinion as to the fairness of such
transaction or series of related transactions to the Company or the relevant
Restricted Subsidiary, as the case may be, from a financial point of view, from
an Independent Financial Advisor and file the same with the Trustee.
(b) The restrictions set forth in clause (a) above shall not apply to (i)
reasonable fees and compensation paid to and indemnity provided on behalf of,
officers, directors, employees or consultants of the Company or any Restricted
Subsidiary of the Company as determined in good faith by the Company's Board of
Directors or senior management; (ii) transactions exclusively between or among
the Company and any of its Restricted Subsidiaries or exclusively between or
among such Restricted Subsidiaries, provided such transactions are not otherwise
prohibited by this Indenture; (iii) transactions exclusively between or among
the Company and any of its Restricted Subsidiaries on the one hand and any
Permitted Joint Venture on the other hand, so long as no portion of the
remaining interest in the Permitted Joint Venture is owned by a Person who is an
Affiliate of the Company (other than another Restricted Subsidiary of the
Company); (iv) any agreement as in effect as of the Issue Date or any amendment
thereto or any transaction contemplated thereby (including pursuant to any
amendment thereto) in any replacement agreement thereto so long as any such
amendment or replacement agreement is not more disadvantageous to the Holders in
any material respect than the original agreement as in effect on the Issue Date;
(v) advances or loans to employees, officers and directors of the Company and
its Restricted Subsidiaries permitted by clauses (iv) and (v) of the definition
of "Permitted Investments"; and (vi) Restricted Payments permitted by this
Indenture.
Section 4.12. Limitation on Incurrence of Additional Indebtedness.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume, guarantee,
acquire, become liable, contingently or otherwise, with respect to, or otherwise
become responsible for payment of (collectively, "incur") any Indebtedness
(other than Permitted Indebtedness); provided, however, that if no Default or
Event of Default shall have occurred and be continuing at the time of or as a
consequence of the incurrence of any such Indebtedness, the Company and its
Restricted Subsidiaries may incur Indebtedness (including, without limitation,
Acquired Indebtedness), in each case if on the date of the incurrence of such
Indebtedness, after giving effect to the incurrence thereof and the application
of the proceeds therefrom, the Consolidated Fixed Charge Coverage Ratio of the
Company is (i) greater than 2.0 to 1.0 if such incurrence is on or prior to
March 15, 2000 or (ii) greater than 2.25 to 1.0 if such incurrence occurs
thereafter.
Section 4.13. Limitation on Dividend and Other Payment Restrictions
Affecting the Company and Restricted Subsidiaries.
The Company will not, and will not cause or permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or permit to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary of the Company to (a) pay dividends or make any other
distributions on or in respect of its Capital Stock; (b) make loans or advances
or to pay any Indebtedness or other obligation owed to the Company or any other
Restricted Subsidiary of the Company; or (c) transfer any of its property or
assets to the Company or any other Restricted Subsidiary of the Company, except
for such encumbrances or restrictions existing under or by reason of: (1)
applicable law; (2) this Indenture; (3) customary nonassignment provisions of
any contract or any lease governing a leasehold interest of the Company or any
Restricted Subsidiary of the Company; (4) any instrument governing Acquired
Indebtedness, which encumbrance or restriction is not applicable to any Person,
or the properties or assets of any Person, other than the Person or the
properties or assets of the Person so acquired; (5) the Amended Credit Facility;
(6) agreements existing on the Issue Date to the extent and in the manner such
agreements are in effect on the Issue Date; (7) restrictions on the transfer of
assets subject to any Lien permitted under this Indenture imposed by the holder
of such Lien; (8) restrictions imposed by any agreement to sell assets permitted
under this Indenture to any Person pending the closing of such sale; (9) any
agreement or instrument governing Capital Stock of any Person that is acquired;
or (10) an agreement governing Indebtedness incurred to Refinance the
Indebtedness issued, assumed or incurred pursuant to an agreement referred to in
clause (2), (4), (5) or (6) above; provided, however, that the provisions
relating to such encumbrance or restriction contained in any such Indebtedness
are no less favorable to the Company in any material respect as determined by
the Board of Directors of the Company in their reasonable and good faith
judgment than the provisions relating to such encumbrance or restriction
contained in the agreement referred to in such clause (2), (4), (5) or (6),
respectively.
Section 4.14. Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder shall have
the right to require that the Company purchase all or a portion of such Holder's
Notes pursuant to the offer described below (the "Change of Control Offer"), at
a purchase price equal to 101% of the principal amount thereof plus accrued and
unpaid interest, if any, thereon to the date of purchase.
(b) Prior to the mailing of the notice referred to below, but in any
event within 30 days following any Change of Control, the Company covenants to
(i) repay in full and terminate all commitments under the Amended Credit
Facility and all other Senior Debt the terms of which require repayment upon a
Change of Control or offer to repay in full and terminate all commitments under
the Amended Credit Agreement and all other such Senior Debt and to repay the
Indebtedness owed to each lender which has accepted such offer or (ii) obtain
the requisite consents under the Amended Credit Facility and all other Senior
Debt to permit the repurchase of the Notes as provided below. The Company shall
first comply with the covenant in the immediately preceding sentence before it
shall be required to repurchase Notes pursuant to the provisions described
below. The Company's failure to comply with the immediately preceding sentence
shall be governed by Section 6.01(c) and not Section 6.01(b).
(c) Within 30 days following the date upon which the Change of Control
occurred, the Company must send, by first class mail, a notice to each Holder at
such Holder's last registered address, with a copy to the Trustee, which notice
shall govern the terms, of the Change of Control Offer. The notice to the
Holders shall contain all instructions and materials necessary to enable such
Holders to tender Notes pursuant to the Change of Control Offer. Such notice
shall state:
(i) that the Change of Control Offer is being made pursuant to
this Section 4.14 and that all Notes tendered and not withdrawn shall
be accepted for payment;
(ii) the purchase price (including the amount of accrued
interest) and the purchase date (which shall be no earlier than 30
days nor later than 45 days from the date such notice is mailed, other
than as may be required by law) (the "Change of Control Payment
Date");
(iii) that any Note not tendered shall continue to accrue
interest;
(iv) that, unless the Company defaults in making payment
therefor, any Note accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest after the Change of
Control Payment Date;
(v) that Holders electing to have a Note purchased pursuant to a
Change of Control Offer shall be required to surrender the Note, with
the form entitled "Option of Holder to Elect Purchase" on the reverse
of the Note completed, to the Paying Agent at the address specified in
the notice prior to the close of business on the third Business Day
prior to the Change of Control Payment Date;
(vi) that Holders shall be entitled to withdraw their election if
the Paying Agent receives, not later than the second business day
prior to the Change of Control Payment Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder,
the principal amount of the Notes the Holder delivered for purchase
and a statement that such Holder is withdrawing his election to have
such Notes purchased;
(vii) that Holders whose Notes are purchased only in part
shall be issued new Notes in a principal amount equal to the
unpurchased portion of the Notes surrendered; provided, however, that
each Note purchased and each new Note issued shall be in an original
principal amount of $1,000 or integral multiples thereof; and
(viii) the circumstances and relevant facts regarding such
Change of Control.
On the Change of Control Payment Date, the Company shall, to the extent
permitted by law, (i) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer, (ii) deposit with the Paying
Agent U.S. Legal Tender in an amount equal to the aggregate Change of Control
Payment in respect of all Notes or portions thereof so tendered and (iii)
deliver, or cause to be delivered, to the Trustee for cancellation the Notes so
accepted together with an Officers' Certificate stating that such Notes or
portions thereof have been tendered to and purchased by the Company. The Paying
Agent will promptly either (x) pay to the Holder against presentation and
surrender (or, in the case of partial payment, endorsement) of the Global Notes
or (y) in the case of Certificated Securities, mail to each Holder of Notes the
Change of Control Payment for such Notes, and the Trustee will promptly
authenticate and deliver to the Holder of the Global Notes a new Global Note or
Notes or, in the case of Physical Notes, mail to each Holder new Certificated
Securities, as applicable, equal in principal amount to any unpurchased portion
of the Notes surrendered, if any, provided that each new Certificated Security
will be in a principal amount of $1,000 or an integral multiple thereof. The
Company will notify the Trustee and the Holders of the results of the Change of
Control Offer on or as soon as practicable after the Change of Control Payment
Date. For purposes of this Section 4.14, the Trustee shall act as the Paying
Agent.
Any amounts remaining after the purchase of Notes pursuant to a Change in
Control Offer shall be returned to the Company.
Neither the Board of Directors of the Company nor the Trustee may waive the
provisions of this Section 4.14 relating to the Company's obligation to make a
Change of Control Offer or a Holder's right to repurchase upon a Change of
Control.
The Company shall comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Notes pursuant to a Change of Control Offer. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of this Section 4.14, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached its
obligations under the provisions of this Section 4.14 by virtue thereof.
Section 4.15. Limitation on Asset Sales.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless (i) the Company or the
applicable Restricted Subsidiary, as the case may be, receives consideration at
the time of such Asset Sale at least equal to the fair market value of the
assets sold or otherwise disposed of (as determined in good faith by the
Company's Board of Directors), (ii) at least 85% of the consideration (other
than indebtedness assumed by the purchaser in connection with such Asset Sale
and as to which there is no further recourse against the Company or the
Restricted Subsidiaries) received by the Company or the Restricted Subsidiary,
as the case may be, from such Asset Sale shall be in the form of cash or Cash
Equivalents and is received at the time of such disposition; and (iii) upon the
consummation of an Asset Sale, the Company shall apply, or cause such Restricted
Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within
270 days of receipt thereof either (A) to prepay any Senior Debt or Guarantor
Senior Debt and, in the case of any Senior Debt or Guarantor Senior Debt under
any revolving credit facility, effect a permanent reduction in the availability
under such revolving credit facility, (B) to make an investment in properties
and assets that replace the properties and assets that were the subject of such
Asset Sale or in properties and assets that will be used in the business of the
Company and its Subsidiaries as existing on the Issue Date or any reasonable
extensions or expansions thereof or any business ancillary thereto or supportive
thereof (including investments in 100% of the equity interest in a Person that
owns such properties and assets) ("Replacement Assets"), or (C) a combination of
prepayment and investment permitted by the foregoing clauses (iii)(A) and
(iii)(B). Pending final application, the Company or the applicable Restricted
Subsidiary may temporarily reduce Indebtedness under any revolving credit
facility or invest in cash or Cash Equivalents. On the 271st day after an Asset
Sale or such earlier date, if any, as the Board of Directors of the Company or
of such Restricted Subsidiary determines not to apply the Net Cash Proceeds
relating to such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and
(iii)(C) of the next preceding sentence (each, a "Net Proceeds Offer Trigger
Date"), such aggregate amount of Net Cash Proceeds which have not been applied
on or before such Net Proceeds Offer Trigger Date as permitted in clauses
(iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each a "Net
Proceeds Offer Amount") shall be applied by the Company or such Restricted
Subsidiary to make an offer to purchase (the "Net Proceeds Offer") on a date
(the "Net Proceeds Offer Payment Date") not less than 30 nor more than 45 days
following the applicable Net Proceeds Offer Trigger Date, from all Holders on a
pro rata basis, that amount of Notes equal to the Net Proceeds Offer Amount at a
price equal to 100% of the principal amount of the Notes to be purchased, plus
accrued and unpaid interest thereon, if any, to the date of purchase; provided,
however, that if at any time any non-cash consideration received by the Company
or any Restricted Subsidiary of the Company, as the case may be, in connection
with any Asset Sale is converted into or sold or otherwise disposed of for cash
(other than interest received with respect to any such non-cash consideration),
then such conversion or disposition shall be deemed to constitute an Asset Sale
hereunder and the Net Cash Proceeds thereof shall be applied in accordance with
this Section 4.15. The Company may defer the Net Proceeds Offer until there is
an aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $5.0
million resulting from one or more Asset Sales (at which time, the entire
unutilized Net Proceeds Offer Amount, and not just the amount in excess of $5.0
million, shall be applied as required pursuant to this paragraph).
In the event of the transfer of substantially all (but not all) of the
property and assets of the Company and its Restricted Subsidiaries as an
entirety to a Person in a transaction permitted under Section 5.01 of this
Indenture, the successor corporation shall be deemed to have sold the properties
and assets of the Company and its Restricted Subsidiaries not so transferred for
purposes of this covenant, and shall comply with the provisions of this covenant
with respect to such deemed sale as if it were an Asset Sale. In addition, the
fair market value of such properties and assets of the Company or its Restricted
Subsidiaries deemed to be sold shall be deemed to be Net Cash Proceeds for
purposes of this covenant.
Notwithstanding the two immediately preceding paragraphs, the Company and
its Restricted Subsidiaries will be permitted to consummate an Asset Sale
without complying with such paragraphs to the extent (i) at least 85% of the
consideration for such Asset Sale constitutes Replacement Assets and (ii) such
Asset Sale is for fair market value; provided that any consideration not
constituting Replacement Assets received by the Company or any of its Restricted
Subsidiaries in connection with any Asset Sale permitted to be consummated under
this paragraph shall constitute Net Cash Proceeds subject to the provisions of
the two preceding paragraphs.
Each Net Proceeds Offer will be mailed to the record Holders as shown on
the register of Holders within 25 days following the Net Proceeds Offer Trigger
Date, with a copy to the Trustee, and shall comply with the procedures set forth
in this Indenture. Upon receiving notice of the Net Proceeds Offer, Holders may
elect to tender their Notes in whole or in part in integral multiples of $1,000
in exchange for cash. To the extent Holders properly tender Notes in an amount
exceeding the Net Proceeds Offer Amount, Notes of tendering Holders will be
purchased on a pro rata basis (based on amounts tendered). A Net Proceeds Offer
shall remain open for a period of 20 business days or such longer period as may
be required by law. To the extent the aggregate amount of the Notes tendered
pursuant to the Net Proceeds Offer is less than the Net Proceeds Offer Amount,
the Company may use such deficiency for general corporate purposes. Upon
completion of such offer to purchase, the Net Proceeds Offer Amount shall be
reset at zero.
Each notice of a Net Proceeds Offer pursuant to this Section 4.15 shall be
mailed or caused to be mailed, by first class mail, by the Company not more than
25 days after the Net Proceeds Offer Trigger Date to all Holders at their last
registered addresses, with a copy to the Trustee. The notice shall contain all
instructions and materials necessary to enable such Holders to tender Notes
pursuant to the Net Proceeds Offer and shall state the following terms:
(i) that the Net Proceeds Offer is being made pursuant to this
Section 4.15 and that all Notes tendered will be accepted for payment;
provided, however, that if the aggregate principal amount of Notes
tendered in a Net Proceeds Offer exceeds the aggregate amount of the
Net Proceeds Offer, the Company shall select the Notes to be purchased
on a pro rata basis (with such adjustments as may be deemed
appropriate by the Company so that only Notes in denominations of
$1,000 or multiples thereof shall be purchased);
(ii) the purchase price (including the amount of accrued
interest, if any) to be paid for Notes purchased pursuant to the Net
Proceeds Offer and the Net Proceeds Payment Date;
(iii) that any Note not tendered for payment will continue to
accrue interest in accordance with the terms thereof;
(iv) that, unless the Company defaults on making the payment, any
Note accepted for payment pursuant to the Net Proceeds Offer shall
cease to accrue interest after the Net Proceeds Payment Date;
(v) that Holders accepting the Offer to have a Note purchased
pursuant to the Net Proceeds Offer will be required to surrender the
Note, with the form entitled "Option of Holder to Elect Purchase" on
the reverse of the Note completed, to the Paying Agent at the address
specified in the notice prior to the close of business on the third
Business Day prior to the Net Proceeds Payment Date;
(vi) that Holders will be entitled to withdraw their acceptance
if the Paying Agent receives, not later than the close of business on
the second Business Day prior to the Net Proceeds Payment Date, a
facsimile transmission or letter setting forth the name of the Holder,
the principal amount of the Notes the Holder delivered for purchase
and a statement that such Holder is withdrawing his election to have
such Notes purchased;
(vii) that Holders whose Notes are purchased only in part
will be issued new Notes in a principal amount equal to the
unpurchased portion of the Notes surrendered; provided that each Note
purchased and each such new Note issued shall be in an original
principal amount in denominations of $1,000 and integral multiples
thereof;
(viii) any other procedures that a Holder must follow to
accept a Net Proceeds Offer or effect withdrawal of such acceptance;
and
(ix) the name and address of the Paying Agent.
On the Net Proceeds Payment Date, the Company shall (i) accept for payment
Notes or portions thereof tendered pursuant to the Net Proceeds Offer in
accordance with this Section 4.15, (ii) deposit timely with the Paying Agent
U.S. Legal Tender sufficient to pay the purchase price, plus accrued interest,
if any, of all Notes to be purchased in accordance with this Section 4.15 and
(iii) deliver to the Trustee Notes so accepted together with an Officers'
Certificate stating the Notes or portions thereof tendered to and accepted for
payment by the Company.
For purposes of this Section 4.15, the Trustee shall act as the Paying
Agent. The Paying Agent shall promptly mail or deliver to the Holders of Notes
so accepted payment in an amount equal to the purchase price for such Notes, and
the Company shall execute and issue, and the Trustee shall promptly authenticate
and mail to such Holders, a new Note equal in principal amount to any
unpurchased portion of the Note surrendered; provided that each such new Note
shall be issued in an original principal amount in denominations of $1,000 and
integral multiples thereof. The Company will send to the Trustee and the
Holders of Notes on or as soon as practicable after the Net Proceeds Payment
Date a notice setting forth the results of the Net Proceeds Offer. Any Notes
not so accepted shall be promptly mailed or delivered by the Company to the
Holder thereof.
The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Notes pursuant to a Net Proceeds Offer. To the extent that the
provisions of any securities laws or regulations conflict with the provisions of
this Section 4.15, the Company shall comply with the applicable securities laws
and regulations and shall not be deemed to have breached its obligations under
this Section 4.15 by virtue thereof.
Section 4.16. Limitation on Preferred Stock of Restricted
Subsidiaries.
The Company will not permit any of its Restricted Subsidiaries to issue any
Preferred Stock (other than to the Company or to a Wholly Owned Restricted
Subsidiary of the Company) or permit any Person (other than the Company or a
Wholly Owned Restricted Subsidiary of the Company) to own any Preferred Stock of
any Restricted Subsidiary of the Company.
Section 4.17. Limitation on Liens.
The Company will not, and will not cause or permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or permit or
suffer to exist any Liens of any kind against or upon any property or assets of
the Company or any of its Restricted Subsidiaries whether owned on the Issue
Date or acquired after the Issue Date, or any proceeds therefrom, or assign or
otherwise convey any right to receive income or profits therefrom unless (i) in
the case of Liens securing Indebtedness that is expressly subordinate or junior
in right of payment to the Notes or any Guarantee, the Notes and such Guarantee
are secured by a Lien on such property, assets or proceeds that is senior in
priority to such Liens and (ii) in all other cases, the Notes are equally and
ratably secured, except for (A) Liens existing as of the Issue Date to the
extent and in the manner such Liens are in effect on the Issue Date; (B) Liens
securing Senior Debt and Liens securing Guarantor Senior Debt; (C) Liens
securing the Notes and the Guarantees; (D) Liens of the Company or a Wholly
Owned Restricted Subsidiary of the Company on assets of any Subsidiary of the
Company; (E) Liens securing Refinancing Indebtedness which is incurred to
Refinance any Indebtedness which has been secured by a Lien permitted under this
Indenture and which has been incurred in accordance with the provisions of this
Indenture; provided, however, that such Liens (i) are no less favorable to the
Holders and are not more favorable to the lienholders with respect to such Liens
than the Liens in respect of the Indebtedness being Refinanced and (ii) do not
extend to or cover any property or assets of the Company or any of its
Restricted Subsidiaries not securing the Indebtedness so Refinanced; and (F)
Permitted Liens.
Section 4.18. Additional Subsidiary Guarantees.
If the Company or any Subsidiary Guarantor transfers or causes to be
transferred, in one transaction or a series of related transactions, any
property in a transaction or a series of transactions which has a value in
excess of $250,000 to any Restricted Subsidiary that is not a Subsidiary
Guarantor, or if the Company or any of its Restricted Subsidiaries shall
organize, acquire or otherwise invest in another Wholly Owned Restricted
Subsidiary organized under the laws of the United States or any State thereof or
in the District of Columbia and having total assets with a book value in excess
of $500,000, then such transferee or acquired or other Restricted Subsidiary
shall (i) execute and deliver to the Trustee a supplemental indenture in form
reasonably satisfactory to the Trustee pursuant to which such Restricted
Subsidiary shall unconditionally guarantee all of the Company's obligations
under the Notes and this Indenture on the terms set forth in this Indenture and
(ii) deliver to the Trustee an Opinion of Counsel that such supplemental
indenture has been duly authorized, executed and delivered by such Restricted
Subsidiary and constitutes a legal, valid, binding and enforceable obligation of
such Restricted Subsidiary; provided, however, that any Restricted Subsidiary
acquired on or after the Issue Date which is prohibited from entering into a
guarantee pursuant to restrictions contained in any debt instrument or other
agreement in existence at the time such Restricted Subsidiary was so acquired
which was not entered into in anticipation or contemplation of such acquisition
shall not be required to become a Subsidiary Guarantor so long as any such
restriction is in existence and to the extent of such restriction. Thereafter,
such Restricted Subsidiary shall be a Subsidiary Guarantor for all purposes of
this Indenture.
Section 4.19. Conduct of Business.
The Company and its Restricted Subsidiaries will not engage in any
businesses which are not the same, similar, reasonably related or necessary to
the businesses in which the Company and its Restricted Subsidiaries are engaged
on the Issue Date or any reasonable extensions or expansions thereof or any
business ancillary thereto or supportive thereof.
Section 4.20. Prohibition on Incurrence of Senior Subordinated
Indebtedness.
The Company will not, and will not permit any Subsidiary Guarantor to,
incur or suffer to exist Indebtedness that is expressly by its terms senior in
right of payment to the Notes or such Subsidiary Guarantor's Guarantee and
subordinate in right of payment to any other Indebtedness of the Company or such
Subsidiary Guarantor, as the case may be.
ARTICLE FIVE
SUCCESSOR CORPORATION
Section 5.01. Merger, Consolidation and Sale of Assets.
(a) The Company will not, in a single transaction or series of related
transactions, consolidate or merge with or into any Person, or sell, assign,
transfer, lease, convey or otherwise dispose of (or cause or permit any
Restricted Subsidiary of the Company to sell, assign, transfer, lease, convey or
otherwise dispose of) all or substantially all of the Company's assets
(determined on a consolidated basis for the Company and the Company's Restricted
Subsidiaries) whether as an entirety or substantially as an entirety to any
Person unless :
(i) either (1) the Company shall be the surviving or continuing
corporation or (2) the Person (if other than the Company) formed by such
consolidation or into which the Company is merged or the Person which acquires
by sale, assignment, transfer, lease, conveyance or other disposition the
properties and assets of the Company and of the Company's Restricted
Subsidiaries substantially as an entirety (the "Surviving Entity") (x) shall be
a corporation organized and validly existing under the laws of the United States
or any State thereof or the District of Columbia and (y) shall expressly assume,
by supplemental indenture (in form and substance satisfactory to the Trustee),
executed and delivered to the Trustee, the due and punctual payment of the
principal of, and premium, if any, and interest on all of the Notes and the
performance of every covenant of the Notes, this Indenture and the Registration
Rights Agreement on the part of the Company to be performed or observed;
(ii) immediately after giving effect to such transaction and the
assumption contemplated by clause (i)(2)(y) above (including giving effect to
any Indebtedness and Acquired Indebtedness incurred or anticipated to be
incurred in connection with or in respect of such transaction), the Company or
such Surviving Entity, as the case may be, (1) shall have a Consolidated Net
Worth equal to or greater than the Consolidated Net Worth of the Company
immediately prior to such transaction and (2) shall be able to incur at least
$1.00 of additional Indebtedness (other than Permitted Indebtedness) pursuant to
Section 4.12 of this Indenture;
(iii) immediately before and immediately after giving effect to such
transaction and the assumption contemplated by clause (i)(2)(y) above
(including, without limitation, giving effect to any Indebtedness and Acquired
Indebtedness incurred or anticipated to be incurred and any Lien granted in
connection with or in respect of the transaction), no Default or Event of
Default shall have occurred or be continuing; and
(iv) the Company or the Surviving Entity shall have delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each stating that
such consolidation, merger, sale, assignment, transfer, lease, conveyance or
other disposition and, if a supplemental indenture is required in connection
with such transaction, such supplemental indenture comply with the applicable
provisions of this Indenture and that all conditions precedent in this Indenture
relating to such transaction have been satisfied.
(b) For purposes of this Section 5.01, the transfer (by lease,
assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all of the properties or assets of one or
more Restricted Subsidiaries of the Company the Capital Stock of which
constitutes all or substantially all of the properties and assets of the
Company, shall be deemed to be the transfer of all or substantially all of the
properties and assets of the Company.
(c) Each Subsidiary Guarantor (other than any Subsidiary Guarantor whose
Guarantee is to be released in accordance with the terms of the Guarantee and
this Indenture in connection with any transaction complying with the provisions
of Section 4.15 of this Indenture) will not, and the Company will not cause or
permit any Subsidiary Guarantor to, consolidate with or merge with or into any
Person other than the Company or any other Subsidiary Guarantor unless: (i) the
entity formed by or surviving any such consolidation or merger (if other than
the Subsidiary Guarantor) or to which such sale, lease, conveyance or other
disposition shall have been made is a corporation organized and existing under
the laws of the United States or any State thereof or the District of Columbia;
(ii) such entity assumes by supplemental indenture all of the obligations of the
Subsidiary Guarantor on the Guarantee; (iii) immediately after giving effect to
such transaction, no Default or Event of Default shall have occurred and be
continuing; and (iv) immediately after giving effect to such transaction and the
use of any net proceeds therefrom on a pro forma basis, the Company could
satisfy the provisions of clause (ii) of Section 5.01(a) of this Indenture. Any
merger or consolidation of a Subsidiary Guarantor with and into the Company
(with the Company being the surviving entity) or another Subsidiary Guarantor
that is a Wholly Owned Restricted Subsidiary of the Company need only comply
with clause (iv) (and not clauses (i), (ii) or (iii)) of Section 5.01(a) of this
Indenture.
Section 5.02. Successor Corporation.
Upon any consolidation, combination or merger or any transfer of all or
substantially all of the assets of the Company in accordance with Section 5.01
of this Indenture, in which the Company is not the Surviving Entity, the
successor Person formed by such consolidation or into which the Company is
merged or to which such conveyance, lease or transfer is made shall succeed to,
and be substituted for, and may exercise every right and power of, the Company
under this Indenture and the Notes with the same effect as if such Surviving
Entity had been named as such.
ARTICLE SIX
REMEDIES
Section 6.01. Events of Default.
An "Event of Default" means any of the following events:
(a) the failure to pay interest on any Notes when the same becomes due
and payable and the default continues for a period of 30 days (whether or not
such payment shall be prohibited by the subordination provisions hereof);
(b) the failure to pay the principal on any Notes, when such principal
becomes due and payable, at maturity, upon redemption or otherwise (including
the failure to make a payment to purchase Notes tendered pursuant to a Change of
Control Offer or a Net Proceeds Offer) (whether or not such payment shall be
prohibited by the subordination provisions hereof);
(c) a default in the observance or performance of any other covenant or
agreement contained in this Indenture which default continues for a period of 30
days after the Company receives written notice specifying the default (and
demanding that such default be remedied) from the Trustee or the Holders of at
least 25% of the outstanding principal amount of the Notes (except in the case
of a default with respect to Section 5.01 of this Indenture, which will
constitute an Event of Default with such notice requirement but without such
passage of time requirement);
(d) the failure to pay at final maturity (giving effect to any applicable
grace periods and any extensions thereof) the principal amount of any
Indebtedness of the Company or any Restricted Subsidiary of the Company and such
failure continues for a period of 20 days or more, or the acceleration of the
final stated maturity of any such Indebtedness (which acceleration is not
rescinded, annulled or otherwise cured within 20 days of receipt by the Company
or such Restricted Subsidiary of notice of any such acceleration) if the
aggregate principal amount of such Indebtedness, together with the principal
amount of any other such Indebtedness in default for failure to pay principal at
final maturity or which has been accelerated, aggregates $5.0 million or more at
any time;
(e) one or more judgments in an aggregate amount in excess of $5.0
million (to the extent not covered by third-party insurance as to which the
insurance company has acknowledged coverage) shall have been rendered against
the Company or any of its Significant Subsidiaries and such judgments remain
undischarged, unpaid or unstayed for a period of 60 days after such judgment or
judgments become final and non-appealable;
(f) the Company or any of its Significant Subsidiaries pursuant to or
under or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding;
(ii) consents to the entry of an order for relief against it in
an involuntary case or proceeding;
(iii) consents to the appointment of a Custodian of it or for
all or substantially all of its property; or
(iv) makes a general assignment for the benefit of its creditors;
(g) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief against the Company or any of its Significant
Subsidiaries in an involuntary case or proceeding;
(ii) appoints a Custodian of the Company or any of its
Significant Subsidiaries for all or substantially all of their
properties taken as a whole; or
(iii) orders the liquidation of the Company or any of its
Significant Subsidiaries;
and in each case the order or decree remains unstayed and in effect for 60 days;
or
(h) any of the Guarantees of a Subsidiary Guarantor that is a Significant
Subsidiary ceases to be in full force and effect or any such Guarantee is
declared to be null and void and unenforceable or any such Guarantee is found to
be invalid, in each case by a court of competent jurisdiction in a final non-
appealable judgment, or any such Subsidiary Guarantor denies its liability under
its Guarantee (other than by reason of release of such Subsidiary Guarantor in
accordance with the terms of this Indenture).
Section 6.02. Acceleration.
(a) If an Event of Default (other than an Event of Default specified in
Section 6.01(f) or (g) with respect to the Company) shall occur and be
continuing, the Trustee or the Holders of at least 25% in principal amount of
outstanding Notes may declare the principal of and accrued interest on all the
Notes to be due and payable by notice in writing to the Company and the Trustee
specifying the respective Event of Default and that it is a "notice of
acceleration" (the "Acceleration Notice"), and the same (i) shall become
immediately due and payable or (ii) if there are any amounts outstanding under
the Amended Credit Facility, shall become immediately due and payable upon the
first to occur of an acceleration under the Amended Credit Facility or 5
Business Days after receipt by the Company and the Representative under the
Amended Credit Facility of such Acceleration Notice but only if such Event of
Default is then continuing. In the event of a declaration of acceleration
because of an Event of Default described in Section 6.01(d) of this Indenture
has occurred and is continuing, such declaration of acceleration shall be
automatically annulled if such payment default is cured or waived or the holders
of the Indebtedness which is the subject of such event of default have rescinded
their declaration of acceleration in respect of such Indebtedness within 60 days
thereof and the Trustee has received written notice of such cure, waiver or
rescission and no other Event of Default described in such Section 6.01(d) has
occurred that has not been cured or waived within 60 days of the declaration of
such acceleration in respect thereof and if (i) the repayment of Indebtedness or
annulment of such acceleration, as the case may be, would not conflict with any
judgment or decree of a court of competent jurisdiction and (ii) all existing
Events of Default, except non-payment of principal or interest which have become
due solely due to such acceleration, have been cured or waived. If an Event of
Default specified in Section 6.01(f) or (g) with respect to the Company occurs
and is continuing, then all unpaid principal of, and premium, if any, and
accrued and unpaid interest on all of the outstanding Notes shall ipso facto
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Holder.
(b) At any time after a declaration of acceleration with respect to the
Notes as described in Section 6.02(a), the Holders of a majority in principal
amount of the Notes may rescind and cancel such declaration and its consequences
(i) if the rescission would not conflict with any judgment or decree, (ii) if
all existing Events of Default have been cured or waived except nonpayment of
principal or interest that has become due solely because of the acceleration,
(iii) to the extent the payment of such interest is lawful, interest on overdue
installments of interest and overdue principal, which has become due otherwise
than by such declaration of acceleration, has been paid, (iv) if the Company has
paid the Trustee its reasonable compensation and reimbursed the Trustee for its
expenses, disbursements and advances and (v) in the event of the cure or waiver
of an Event of Default of the type described in clauses (f) or (g) of Section
6.01, the Trustee shall have received an Officers' Certificate and an Opinion of
Counsel that such Event of Default has been cured or waived. No such rescission
shall affect any subsequent Default or impair any right consequent thereto.
Section 6.03. Other Remedies.
(a) If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of the principal of, premium, if any, or interest on the Notes or to
enforce the performance of any provision of the Notes or this Indenture.
(b) All rights of action and claims under this Indenture or the Notes may
be enforced by the Trustee even if it does not possess any of the Notes or does
not produce any of them in the proceeding. A delay or omission by the Trustee
or any Holder in exercising any right or remedy accruing upon an Event of
Default shall not impair the right or remedy or constitute a waiver of or
acquiescence in the Event of Default. No remedy is exclusive of any other
remedy. All available remedies are cumulative to the extent permitted by law.
Section 6.04. Waiver of Past Defaults.
Subject to Sections 2.09, 6.07 and 9.02, the Holders of a majority in
principal amount of the Notes then outstanding by notice to the Trustee may, on
behalf of the Holders of all the Notes, waive any existing Default or Event of
Default under the Indenture, and its consequences, except a Default or Event of
Default specified in Section 6.01(a) or (b). When a Default or Event of Default
is so waived, it shall be deemed cured and shall cease to exist. This Section
6.04 shall be in lieu of 316(a)(1)(B) of the TIA and such 316(a)(1)(B) of
the TIA is hereby expressly excluded from this Indenture and the Notes, as
permitted by the TIA.
Section 6.05. Control by Majority.
Subject to Section 2.09 and applicable law, the Holders of a majority in
aggregate principal amount of the then outstanding Notes may direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on the Trustee, including
(without limitation) any remedies provided for in Section 6.03; provided,
however, that the Trustee may refuse to follow any direction (a) that conflicts
with any rule of law or this Indenture, (b) that the Trustee, in its sole
discretion, determines may be unduly prejudicial to the rights of another
Holder, or (c) that may expose the Trustee to personal liability for which
adequate indemnity provided to the Trustee against such liability is not
reasonably assured to it; provided, further, however, that the Trustee may take
any other action deemed proper by the Trustee that is not inconsistent with such
direction or this Indenture. This Section 6.05 shall be in lieu of
316(a)(1)(A) of the TIA, and such 316(a)(1)(A) of the TIA is hereby expressly
excluded from this Indenture and the Notes, as permitted by the TIA.
Section 6.06. Limitation on Suits.
No Holder of any Notes shall have any right to institute any proceeding
with respect to this Indenture or the Notes or any remedy hereunder, unless (i)
the Holders of at least 25% in aggregate principal amount of the outstanding
Notes have made written request, and offered reasonable indemnity, to the
Trustee to institute such proceeding as Trustee under the Notes and this
Indenture, (ii) the Trustee has failed to institute such proceeding within 30
days after receipt of such notice, request and offer of indemnity and (iii) the
Trustee, within such 30 day period, has not received directions inconsistent
with such written request by Holders of a majority in aggregate principal amount
of the outstanding Notes.
The foregoing limitations shall not apply to a suit instituted by a Holder
of a Note for the enforcement of the payment of the principal of, premium, if
any, or interest on, such Note on or after the respective due dates expressed or
provided for in such Note.
A Holder may not use this Indenture to prejudice the rights of any other
Holders or to obtain priority or preference over such other Holders.
Section 6.07. Right of Holders To Receive Payment.
Notwithstanding any other provision in this Indenture, the right of any
Holder of a Note to receive payment of the principal of, premium, if any, and
interest on such Note, on or after the respective due dates expressed or
provided for in such Note, or to bring suit for the enforcement of any such
payment on or after the respective due dates, is absolute and unconditional and
shall not be impaired or affected without the consent of the Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in clause (a) or (b) of Section 6.01
occurs and is continuing, the Trustee may recover judgment in its own name and
as trustee of an express trust against the Company, a Subsidiary Guarantor or
any other obligor on the Notes for the whole amount of the principal of,
premium, if any, and accrued interest remaining unpaid, together with interest
on overdue principal and, to the extent that payment of such interest is lawful,
interest on overdue installments of interest, in each case at the rate per annum
provided for by the Notes and such further amount as shall be sufficient to
cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel and any other amounts due the Trustee pursuant to the provisions of
Section 7.07.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents, counsel, accountants and experts) and
the Holders allowed in any judicial proceedings relative to the Company (or any
Subsidiary Guarantor or any other obligor upon the Notes), its creditors or its
property and shall be entitled and empowered to collect and receive any monies
or other property payable or deliverable on any such claims and to distribute
the same, and any Custodian in any such judicial proceedings is hereby
authorized by each Holder to make such payments to the Trustee and, in the event
that the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agent and
counsel, and any other amounts due the Trustee under Section 7.07. Nothing
herein contained shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Holder in any such proceeding.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article Six it shall pay
out such money in the following order:
FIRST: to the Trustee, its agents, counsel and experts for
amounts due under Section 7.07, including payment of all compensation,
expenses and liabilities incurred, and all advances made, by the
Trustee and the cost and expenses of collection;
SECOND: to Holders for interest accrued on the Notes, ratably,
without preference or priority of any kind, according to the amounts
due and payable on the Notes for interest;
THIRD: to Holders for the principal amounts (including any
premium) owing under the Notes, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Notes for the principal (including any premium); and
FOURTH: the balance, if any, to the Company.
The Trustee, upon prior written notice to the Company, may fix a record
date and payment date for any payment to Holders pursuant to this Section 6.10.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as
Trustee, a court may in its discretion require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section 6.11
does not apply to any suit by the Trustee, any suit by a Holder pursuant to
Section 6.06, or a suit by a Holder or Holders of more than 10% in aggregate
principal amount of the outstanding Notes.
ARTICLE SEVEN
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee
will exercise such of the rights and powers vested in it by this Indenture and
use the same degree of care and skill in its exercise thereof as a prudent man
would exercise or use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee will perform only those duties as are
specifically set forth in this Indenture and no covenants or
obligations shall be implied in this Indenture against the Trustee.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they conform to
the requirements of this Indenture.
(c) Notwithstanding anything to the contrary herein contained, the
Trustee may not be relieved from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of
this Section 7.01.
(2) The Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Sections 6.02, 6.04 or 6.05.
(d) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder or in the exercise of any of its rights or powers
if it shall have reasonable grounds for believing that repayment of such funds
or adequate indemnity against such risk or liability is not reasonably assured
to it.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.01.
(f) The Trustee shall not be liable for interest on any money or assets
received by it except as the Trustee may agree in writing with the Company.
Assets held in trust by the Trustee need not be segregated from other assets
except to the extent required by law.
Section 7.02. Rights of Trustee.
Subject to the provisions of Section 7.01:
(a) The Trustee may rely and shall be fully protected in acting or
refraining from acting upon any document believed by it to be genuine and to
have been signed or presented by the proper Person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may consult with
counsel and may require an Officers' Certificate, an Opinion of Counsel or both,
which shall conform to Sections 13.04 and 13.05. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel.
(c) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or indirectly or by or through
attorneys and agents, and the Trustee shall not be responsible for the
misconduct or negligence of any attorney or agent appointed with due care.
(d) The Trustee shall not be liable for any action that it takes or omits
to take in good faith which it reasonably believes to be authorized or within
its rights or powers.
(e) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, notice, request, direction, consent, order, bond, debenture, or other
paper or document, but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit, and, if
the Trustee shall determine to make such further inquiry or investigation, it
shall be entitled, upon reasonable notice to the Company, to examine the books,
records, and premises of the Company, personally or by agent or attorney, and to
consult with the officers and representatives of the Company, including the
Company's accountants and attorneys.
(f) The Trustee shall be under no obligation to exercise any of its
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this Indenture,
unless such Holders have offered to the Trustee reasonable indemnity
satisfactory to the Trustee against the costs, expenses and liabilities which
may be incurred by it in compliance with such request, order or direction.
(g) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner or
pledgee of Notes and may otherwise deal with the Company, or any Subsidiary of
the Company or their respective Affiliates with the same rights it would have if
it were not Trustee. Any Agent may do the same with like rights. However, the
Trustee must comply with the provisions of Sections 7.10 and 7.11.
Section 7.04. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of this
Indenture, the Notes, or any collateral or security therefor and it shall not be
accountable for the Company's use of the proceeds from the Notes, it shall not
be responsible for the use or application of any money received by any Paying
Agent other than the Trustee, and it shall not be responsible for any statement
of the Company in this Indenture or the Notes other than the Trustee's
certificate of authentication. The Trustee has not participated in the
preparation of the Offering Memorandum and has not verified the accuracy of the
information contained therein.
Section 7.05. Notice of Default.
If a Default or an Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to each Holder notice of the
uncured Default or Event of Default within 90 days after obtaining knowledge
thereof. Except in the case of a Default or an Event of Default in payment of
principal of, or interest on, any Note, including an accelerated payment, a
Default in payment on the Change of Control Payment Date pursuant to a Change of
Control Offer or on the Net Proceeds Offer Payment Date pursuant to a Net
Proceeds Offer and a Default in compliance with Article Five hereof, the Trustee
may withhold the notice if and so long as its Board of Directors, the executive
committee of its Board of Directors or a committee of its directors and/or Trust
Officers (as the Trustee deems appropriate) in good faith determines that
withholding the notice is in the interest of the Holders. The foregoing
sentence of this Section 7.05 shall be in lieu of the proviso to 315(b) of the
TIA and such proviso to 315(b) of the TIA is hereby expressly excluded from
this Indenture and the Notes, as permitted by the TIA.
Section 7.06. Reports by Trustee to Holders.
Within 60 days after May 15 of each year beginning with 1998, the Trustee
shall, to the extent that any of the events described in TIA 313(a) occurred
within the previous twelve months, but not otherwise, mail to each Holder a
brief report dated as of such date that complies with TIA 313(a). The Trustee
also shall comply with TIA 313(b), (c) and (d).
A copy of each report at the time of its mailing to Holders shall be mailed
to the Company and filed with the Commission and each stock exchange, if any, on
which the Notes are listed.
The Company shall promptly notify the Trustee if the Notes become listed on
any stock exchange and the Trustee shall comply with TIA 313 (d).
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time such compensation
for its services as has been agreed to in writing signed by the Company and the
Trustee. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse the
Trustee upon request for all reasonable fees and expenses, including out-of-
pocket expenses incurred or made by it in connection with the performance of its
duties under this Indenture. Such expenses shall include the reasonable fees
and expenses of the Trustee's agents, counsel, accountants and experts.
The Company shall indemnify the Trustee and its agents, employees,
stockholders, directors and officers for, and hold them harmless against, any
and all loss, liability, damage, claim or expense, incurred by them except for
such actions to the extent caused by any negligence, bad faith or willful
misconduct on their part, arising out of or in connection with the
administration of this trust including the reasonable costs and expenses of
enforcing this Indenture against the Company and the Subsidiary Guarantors and
of defending themselves against any claim or liability in connection with the
exercise or performance of any of their rights, powers or duties hereunder. The
Trustee shall notify the Company promptly of any claim asserted against the
Trustee for which it may seek indemnity. At the Trustee's sole discretion, the
Company shall defend the claim and the Trustee shall cooperate and may
participate in the defense; provided, however, that any settlement of a claim
shall be approved in writing by the Trustee if such settlement would result in
an admission of liability by the Trustee or if such settlement would not be
accompanied by a full release of the Trustee for all liability arising out of
the events giving rise to such claim. Alternatively, the Trustee may at its
option have separate counsel of its own choosing and the Company shall pay the
reasonable fees and expenses of such counsel; provided, that the Company will
not be required to pay such fees and expenses which are accrued from and after
the date upon which it assumes the Trustee's defense and there is no conflict of
interest between the Company and the Trustee in connection with such defense as
reasonably determined by the Trustee. The Company need not pay for any
settlement made without its written consent. The Company need not reimburse any
expenses or indemnify against any loss or liability to the extent incurred by
the Trustee through its negligence, bad faith or willful misconduct.
To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a lien prior to the Notes on all assets or money held or
collected by the Trustee, in its capacity as Trustee, except assets or money
held in trust to pay principal of or premium, if any, or interest on particular
Notes.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(f) or Section 6.01(g) occurs, such expenses
and the compensation for such services are intended to constitute expenses of
administration under any Bankruptcy Law.
The provisions of this Section 7.07 shall survive the termination of this
Indenture.
Section 7.08. Replacement of Trustee.
The Trustee may resign by so notifying the Company. The Holders of a
majority in principal amount of the outstanding Notes may remove the Trustee and
appoint a successor Trustee with the Company's consent, by so notifying the
Company and the Trustee. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the
Trustee or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall notify each Holder of such event
and shall promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in aggregate principal
amount of the outstanding Notes may appoint a successor Trustee to replace the
successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Immediately after that, the
retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee, subject to the lien provided in Section 7.07, the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. A successor Trustee shall mail notice of its appointment to each
Holder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in aggregate principal amount of the outstanding Notes
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee fails to comply with Section 7.10, any Holder may petition
any court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
Notwithstanding any resignation or replacement of the Trustee pursuant to
this Section 7.08, the Company's obligations under Section 7.07 shall continue
for the benefit of the retiring Trustee.
Section 7.09. Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee; provided, however, that
such corporation shall be otherwise qualified and eligible under this Article
Seven.
Section 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the requirement of
TIA 310(a)(1), (2) and (5). The Trustee (or, in the case of a Trustee that
is a subsidiary of another Bank or a corporation included in a bank holding
company system, the related bank or bank holding company) shall have a combined
capital and surplus of at least $100.0 million as set forth in its most recent
published annual report of condition. In addition, if the Trustee is a
subsidiary of another Bank or a corporation included in a bank holding company
system, the Trustee, independently of such bank or bank holding company, shall
meet the capital requirements of TIA 310(a)(2). The Trustee shall comply with
the TIA 310(b); provided, however, that there shall be excluded from the
operation of TIA 310(b)(1) any indenture or indentures under which other
securities, or certificates of interest or participation in other securities, of
the Company are outstanding, if the requirements for such exclusion set forth in
TIA 310(b)(1) are met. The provisions of TIA 310 shall apply to the
Company, as obligor of the Notes.
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA 311(a), excluding any creditor
relationship listed in TIA 311(b). A Trustee who has resigned or been removed
shall be subject to TIA 311(a) to the extent indicated therein. The
provisions of TIA 311 shall apply to the Company, as obligor on the Notes.
ARTICLE EIGHT
DISCHARGE OF INDENTURE; DEFEASANCE
Section 8.01. Termination of the Company's Obligations.
This Indenture will be discharged and will cease to be of further effect
(except as to surviving rights or registration of transfer or exchange of the
Notes, as expressly provided for in this Indenture) as to all outstanding Notes
when (i) either (a) all the Notes theretofore authenticated and delivered
(except lost, stolen or destroyed Notes which have been replaced or paid and
Notes for whose payment U.S. Legal Tender has theretofore been deposited in
trust or segregated and held in trust by the Company and thereafter repaid to
the Company or discharged from such trust) have been delivered to the Trustee
for cancellation or (b) all Notes not theretofore delivered to the Trustee for
cancellation have become due and payable and the Company has irrevocably
deposited or caused to be deposited with the Trustee U.S. Legal Tender in an
amount sufficient to pay and discharge the entire Indebtedness on the Notes not
theretofore delivered to the Trustee for cancellation, for principal of,
premium, if any, and interest on the Notes to the date of deposit together with
irrevocable instructions from the Company directing the Trustee to apply such
funds to the payment thereof at maturity or redemption, as the case may be; (ii)
the Company has paid all other sums payable under this Indenture by the Company;
and (iii) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel stating that all conditions precedent under this Indenture
relating to the satisfaction and discharge of this Indenture have been complied
with. Such Opinion of Counsel shall also state that such satisfaction and
discharge does not result in a default under the Amended Credit Facility (if
then in effect) or any other material agreement or instrument that binds or
affects the Company.
The Company may, at its option and at any time (including notwithstanding
the exercise by the Company of a Covenant Defeasance), elect to have its
obligations and the obligations of the Subsidiary Guarantors discharged with
respect to the outstanding Notes ("Legal Defeasance"). Such Legal Defeasance
means that the Company shall be deemed to have paid and discharged the entire
indebtedness represented by the outstanding Notes, except for (i) the rights of
Holders to receive payments in respect of the principal of, premium, if any, and
interest on the Notes when such payments are due solely from the trust fund
described in Section 8.02, (ii) the Company's obligations with respect to the
Notes concerning issuing temporary Notes, registration of Notes, mutilated,
destroyed, lost or stolen Notes and the maintenance of an office or agency for
payments, (iii) the rights, powers, trust, duties and immunities of the Trustee
and the Company's obligations in connection therewith and (iv) the Legal
Defeasance provisions of this Indenture. In addition, the Company may, at its
option and at any time, elect to have the obligations of the Company released
with respect to covenants contained in Sections 4.10 through 4.20 and Article
Five of this Indenture ("Covenant Defeasance") and thereafter any omission to
comply with such obligations shall not constitute a Default or Event of Default
with respect to the Notes. In the event of Covenant Defeasance, those events
described under Section 6.01 (except those events described in Section 6.01(a),
(b), (f) and (g)) will no longer constitute an Event of Default with respect to
the Notes.
In order to exercise either Legal Defeasance or Covenant Defeasance:
(i) the Company must irrevocably deposit with the Trustee, in trust, for
the benefit of the Holders U.S. Legal Tender, noncallable U.S. Government
Obligations, or a combination thereof, in such amounts as will be sufficient, in
the opinion of a nationally recognized firm of independent public accountants,
to pay the principal of, premium, if any, and interest on the Notes on the
stated date for payment thereof or on the applicable Redemption Date, as the
case may be;
(ii) in the case of Legal Defeasance, the Company shall have delivered to
the Trustee an Opinion of Counsel in the United States reasonably acceptable to
the Trustee confirming that (A) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling or (B) since the date of
this Indenture, there has been a change in the applicable federal income tax
law, in either case to the effect that, and based thereon such Opinion of
Counsel shall confirm that, the Holders will not recognize income, gain or loss
for federal income tax purposes as a result of such Legal Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Legal Defeasance had not
occurred;
(iii) in the case of Covenant Defeasance, the Company shall have delivered
to the Trustee an Opinion of Counsel in the United States reasonably acceptable
to the Trustee confirming that the Holders will not recognize income, gain or
loss for federal income tax purposes as a result of such Covenant Defeasance and
will be subject to federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such Covenant Defeasance
had not occurred;
(iv) no Default or Event of Default shall have occurred and be continuing
on the date of such deposit (other than a Default or Event of Default resulting
from the incurrence of Indebtedness, all or a portion of the proceeds of which
will be used to defease the Notes) or insofar as Events of Default under Section
6.01(f) or (g) from bankruptcy or insolvency events are concerned, at any time
in the period ending on the 91st day after the date of deposit;
(v) such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under this Indenture or any
other material agreement or instrument to which the Company or any of its
Restricted Subsidiaries is a party or by which the Company or any of its
Restricted Subsidiaries is bound;
(vi) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the Holders over any other creditors of the Company or with the
intent of defeating, hindering, delaying or defrauding any other creditors of
the Company or others;
(vii) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for or relating to the Legal Defeasance or the Covenant
Defeasance, as the case may be, have been complied with;
(viii) the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that (A) the trust funds will not be subject to any rights
of any holders of Senior Debt, including, without limitation, those arising
under this Indenture and (B) after the 91st day following the deposit, the trust
funds will not be subject to the effect of any applicable Bankruptcy Law; and
(ix) certain other customary conditions precedent are satisfied.
Section 8.02. Application of Trust Money.
The Trustee or Paying Agent shall hold in trust U.S. Legal Tender or U.S.
Government Obligations deposited with it pursuant to Section 8.01, and shall
apply the deposited U.S. Legal Tender and the money from U.S. Government
Obligations in accordance with this Indenture to the payment of the principal of
and interest on the Notes. The Trustee shall be under no obligation to invest
said U.S. Legal Tender or U.S. Government Obligations.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Legal Tender or U.S.
Government Obligations deposited pursuant to Section 8.01 or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of outstanding Notes.
Anything in this Article Eight to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the Company's request
any U.S. Legal Tender or U.S. Government Obligations held by it as provided in
this Article Eight which, in the opinion of a nationally recognized form of
independent public accountants expressed on a written certification thereof
delivered to the Trustee, are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
Section 8.03. Repayment to the Company.
Subject to Article Eight, the Trustee and the Paying Agent shall promptly
pay to the Company upon request any excess U.S. Legal Tender or U.S. Government
Obligations held by them at any time and thereupon shall be relieved from all
liability with respect to such money. The Trustee and the Paying Agent shall
pay to the Company upon request any money held by them for the payment of
principal or interest that remains unclaimed for one year; provided, however,
that the Company shall, if requested by the Trustee or Paying Agent, give to the
Trustee or Paying Agent, indemnification reasonably satisfactory to it against
any and all liability which may be incurred by it by reason of such paying;
provided, further, that the Trustee or such Paying Agent, before being required
to make any payment, may at the expense of the Company cause to be published
once in a newspaper of general circulation in the City of New York and mail to
each Holder entitled to such money notice that such money remains unclaimed and
that after a date specified therein which shall be at least 30 days from the
date of such publication and mailing any unclaimed balance of such money then
remaining will be repaid to the Company. After payment to the Company, Holders
entitled to such money must look to the Company for payment as general creditors
unless an applicable law designates another Person, and all liability of the
Trustee and such Paying Agent with respect to such money shall cease.
Section 8.04. Reinstatement.
If the Trustee or Paying Agent is unable to apply any U.S. Legal Tender or
U.S. Government Obligations in accordance with Article Eight by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's obligations under this Indenture and the Notes shall
be revived and reinstated as though no deposit had occurred pursuant to Article
Eight until such time as the Trustee or Paying Agent is permitted to apply all
such U.S. Legal Tender or U.S. Government Obligations in accordance with Section
8.01; provided, however, that if the Company has made any payment of interest on
or principal of any Notes because of the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of such Notes to
receive such payment from the U.S. Legal Tender or U.S. Government Obligations
held by the Trustee or Paying Agent.
Section 8.05. Acknowledgment of Discharge by Trustee.
After (i) the conditions of Section 8.01 have been satisfied, (ii) the
Company has paid or caused to be paid all other sums payable hereunder by the
Company and (iii) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent referred to in clause (i) above relating to the satisfaction and
discharge of this Indenture have been complied with, the Trustee upon request
shall acknowledge in writing the discharge of the Company's obligations under
this Indenture except for those surviving obligations specified in Section 8.01;
provided the legal counsel delivering such Opinion of Counsel may rely as to
matters of fact on one or more Officers' Certificates of the Company.
ARTICLE NINE
MODIFICATION OF THE INDENTURE
Section 9.01. Without Consent of Holders.
Subject to the provisions of Section 9.02, the Company, the Subsidiary
Guarantors and the Trustee may amend, waive or supplement this Indenture without
notice to or consent of any Holder: (i) to cure any ambiguity, defect or
inconsistency; (ii) to comply with Section 5.01 of this Indenture; (iii) to
provide for uncertificated Notes in addition to certificated Notes; (iv) to
comply with any requirements of the Commission in order to effect or maintain
the qualification of this Indenture under the TIA; (v) to make any change that
would provide any additional benefit or rights to the Holders and that does not
adversely affect in any material respect the rights of any Holder; or (vi) to
make any other change that does not, in the opinion of the Trustee, adversely
affect in any material respect the rights of any Holders hereunder.
Notwithstanding the foregoing, the Trustee, the Subsidiary Guarantors and the
Company may not make any change pursuant to this Section 9.01 that, in the
opinion of the Trustee, adversely affects in any material respect the rights of
any Holder under this Indenture without the consent of such Holder. In
formulating its opinion on such matters, the Trustee will be entitled to rely on
such evidence at it deems appropriate, including, without limitation, solely on
an Opinion of Counsel; provided, however, that in delivering such Opinion of
Counsel, such counsel may rely as to matters of fact, on a certificate or
certificates of Officers of the Company.
Section 9.02. With Consent of Holders.
The Company, the Subsidiary Guarantors and the Trustee may amend or
supplement this Indenture or the Notes or any amended or supplemental Indenture
with the written consent of the Holders of not less than a majority in principal
amount of the then outstanding Notes issued under this Indenture without notice
to any other Holders.
Upon the request of the Company and the Subsidiary Guarantors accompanied
by a Board Resolution authorizing the execution of any such amended or
supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid,
and upon receipt by the Trustee of the documents described in Section 9.06, the
Trustee shall join with the Company and the Subsidiary Guarantors in the
execution of such amended or supplemental Indenture unless such amended or
supplemental Indenture affects the Trustee's own rights, duties or immunities
under this Indenture or otherwise, in which case the Trustee may in its sole
discretion, but shall not be obligated to, enter into such amended or
supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes under
this Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice describing the amendment, supplement or waiver. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such amended or supplemental Indenture
or waiver. Subject to Sections 6.04 and 6.07, the Holders of a majority in
aggregate principal amount of the Notes then outstanding may waive compliance in
a particular instance by the Company or any Restricted Subsidiary of the Company
with any provision of this Indenture or the Notes. However, without the consent
of each Holder of the Notes affected thereby, no amendment may: (i) reduce the
amount of Notes whose Holders must consent to an amendment; (ii) reduce the rate
of or change or have the effect of changing the time for payment of interest,
including defaulted interest, on any Notes; (iii) reduce the principal of or
change or have the effect of changing the fixed maturity of any Notes, or change
the date on which any Notes may be subject to redemption or repurchase, or
reduce the redemption or repurchase price therefor; (iv) make any Notes payable
in money other than that stated in the Notes; (v) make any change in provisions
of this Indenture protecting the right of each Holder to receive payment of
principal of and interest on such Note on or after the due date thereof or to
bring suit to enforce such payment, or permitting Holders of a majority in
principal amount of the Notes to waive Defaults or Events of Default; (vi)
amend, change or modify in any material respect the obligation of the Company to
make and consummate a Change of Control Offer in the event of a Change of
Control or make and consummate a Net Proceeds Offer with respect to any Asset
Sale that has been consummated or modify any of the provisions or definitions
with respect thereto; (vii) modify or change any provision of this Indenture or
the related definitions affecting the subordination or ranking of the Notes or
any Guarantee in a manner which adversely affects the Holders in any material
respect; or (viii) release any Subsidiary Guarantor from any of its obligations
under its Guarantee or this Indenture otherwise than in accordance with the
terms of this Indenture.
Section 9.03. Effect on Senior Debt.
No amendment of this Indenture shall adversely affect the rights of any
holder of Senior Debt under Article Eleven of this Indenture or Guarantor Senior
Debt under Article Twelve of the Indenture, in each case without consent of such
holder.
Section 9.04. Compliance with TIA.
Every amendment, waiver or supplement of this Indenture or the Notes shall
comply with the TIA as then in effect; provided, however, that this Section 9.04
shall not of itself require that this Indenture or the Trustee be qualified
under the TIA or constitute any admission or acknowledgment by any party hereto
that any such qualification is required prior to the time this Indenture and the
Trustee are required by the TIA to be so qualified.
Section 9.05. Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a consent to it
by a Holder is a continuing consent by the Holder and every subsequent Holder of
a Note or portion of a Note that evidences the same debt as the consenting
Holder's Note, even if notation of the consent is not made on any Note. Subject
to the following paragraph, any such Holder or subsequent Holder may revoke the
consent as to such Holder's Note or portion of such Note by notice to the
Trustee or the Company received before the date on which the Trustee receives an
Officers' Certificate certifying that the Holders of the requisite principal
amount of Notes have consented (and not theretofore revoked such consent) to the
amendment, supplement or waiver. An amendment, supplement or waiver becomes
effective upon receipt by the Trustee of such Officers' Certificate and evidence
of consent by the Holders of the requisite percentage in principal amount of
outstanding Notes.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the
second sentence of the immediately preceding paragraph, those Persons who were
Holders at such record date (or their duly designated proxies), and only those
Persons, shall be entitled to revoke any consent previously given, whether or
not such Persons continue to be Holders after such record date. No such consent
shall be valid or effective for more than 90 days after such record date.
Section 9.06. Notation on or Exchange of Notes.
If an amendment, supplement or waiver changes the terms of a Note, the
Trustee may require the Holder of such Note to deliver it to the Trustee. The
Trustee may place an appropriate notation on the Note about the changed terms
and return it to the Holder. Alternatively, if the Company or the Trustee so
determine, the Company in exchange for the Note shall issue and the Trustee
shall authenticate a new Note that reflects the changed terms.
Section 9.07. Trustee To Sign Amendments, Etc.
The Trustee shall execute any amendment, supplement or waiver authorized
pursuant to this Article Nine; provided, however, that the Trustee may, but
shall not be obligated to, execute any such amendment, supplement or waiver
which affects the Trustee's own rights, duties or immunities under this
Indenture. In executing such amendment, supplement or waiver the Trustee shall
be entitled to receive indemnity reasonably satisfactory to it, and shall be
fully protected in relying upon an Opinion of Counsel and an Officers'
Certificate of the Company, stating that no Event of Default shall occur as a
result of such amendment, supplement or waiver and that the execution of such
amendment, supplement or waiver authorized pursuant to this Article Nine is
authorized or permitted by this Indenture. Such Opinion of Counsel shall not be
an expense of the Trustee.
ARTICLE TEN
GUARANTEE OF NOTES
Section 10.01. Unconditional Guarantee.
Subject to the provisions of this Article Ten, each Subsidiary Guarantor
unconditionally guarantees, on a senior subordinated basis, jointly and
severally (such guarantee to be referred to herein as a "Guarantee"), to each
Holder and the Trustee, irrespective of the validity and enforceability of this
Indenture, the Notes or the obligations of the Company or any other Subsidiary
Guarantor to the Holders or the Trustee hereunder or thereunder, that: (a) the
principal of, premium, if any, and interest on the Notes (and any Additional
Interest payable thereon) shall be duly and punctually paid in full when due,
whether at maturity, upon redemption at the option of Holders pursuant to the
provisions of the Notes relating thereto, by acceleration or otherwise, and
interest on the overdue principal and (to the extent permitted by law) interest,
if any, on the Notes and all other obligations of the Company or the Subsidiary
Guarantors to the Holders or the Trustee hereunder or thereunder (including
amounts due the Trustee under Section 7.07) and all other obligations shall be
promptly paid in full or performed, all in accordance with the terms hereof and
thereof; and (b) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, the same shall be promptly paid in full
when due or performed in accordance with the terms of the extension or renewal,
whether at maturity, by acceleration or otherwise. Failing payment when due of
any amount so guaranteed, or failing performance of any other obligation of the
Company to the Holders under this Indenture or under the Notes, for whatever
reason, each Subsidiary Guarantor shall be obligated to pay, or to perform or
cause the performance of, the same immediately. An Event of Default under this
Indenture or the Notes shall constitute an event of default under this
Guarantee, and shall entitle the Holders of Notes to accelerate the obligations
of the Subsidiary Guarantors hereunder in the same manner and to the same extent
as the obligations of the Company.
Each of the Subsidiary Guarantors hereby agrees that its obligations
hereunder shall be unconditional, irrespective of the validity, regularity or
enforceability of the Notes or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Notes with respect
to any provisions hereof or thereof, any release of any other Subsidiary
Guarantor, the recovery of any judgment against the Company, any action to
enforce the same, whether or not a Guarantee is affixed to any particular Note,
or any other circumstance which might otherwise constitute a legal or equitable
discharge or defense of a Subsidiary Guarantor. Each of the Subsidiary
Guarantors hereby waives the benefit of diligence, presentment, demand of
payment, filing of claims with a court in the event of insolvency or bankruptcy
of the Company, any right to require a proceeding first against the Company,
protest, notice and all demands whatsoever and covenants that its Guarantee
shall not be discharged except by complete performance of the obligations
contained in the Notes, this Indenture and this Guarantee. This Guarantee is a
guarantee of payment and not of collection. If any Holder or the Trustee is
required by any court or otherwise to return to the Company or to any Subsidiary
Guarantor, or any custodian, trustee, liquidator or other similar official
acting in relation to the Company or such Subsidiary Guarantor, any amount paid
by the Company or such Subsidiary Guarantor to the Trustee or such Holder, this
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect. Each Subsidiary Guarantor further agrees that, as between it,
on the one hand, and the Holders of Notes and the Trustee, on the other hand,
(a) subject to this Article Ten, the maturity of the obligations guaranteed
hereby may be accelerated as provided in Article Six for the purposes of this
Guarantee, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the obligations guaranteed hereby, and (b) in
the event of any acceleration of such obligations as provided in Article Six,
such obligations (whether or not due and payable) shall forthwith become due and
payable by the Subsidiary Guarantors for the purpose of this Guarantee.
No stockholder, officer, director, employee or incorporator, past, present
or future, or any Subsidiary Guarantor, as such, shall have any personal
liability under this Guarantee by reason of his, her or its status as such
stockholder, officer, director, employee or incorporator.
Each Subsidiary Guarantor that makes a payment or distribution of more than
its proportionate share under a Guarantee shall be entitled to a contribution
from each other Subsidiary Guarantor in an amount pro rata, based on the net
assets of each Subsidiary Guarantor, determined in accordance with GAAP.
Section 10.02. Limitations on Guarantee.
The obligations of each Subsidiary Guarantor under its Guarantee are
limited to the maximum amount which, after giving effect to all other contingent
and fixed liabilities of such Subsidiary Guarantor and after giving effect to
any collections from or payments made by or on behalf of any other Subsidiary
Guarantor in respect of the obligations of such other Subsidiary Guarantor under
its Guarantee or pursuant to its contribution obligations under this Indenture,
will result in the obligations of such Subsidiary Guarantor under the Guarantee
not constituting a fraudulent conveyance or fraudulent transfer under any laws
of the United States, any state of the United States or the District of
Columbia.
Section 10.03. Execution and Delivery of Guarantee.
To further evidence the Guarantee set forth in Section 10.01, each
Subsidiary Guarantor hereby agrees that a notation of such Guarantee,
substantially in the form of Exhibit E, shall be endorsed on each Note
authenticated and delivered by the Trustee. Such Guarantee shall be executed on
behalf of each Subsidiary Guarantor by either manual or facsimile signature of
one officer of the Subsidiary Guarantor, who shall have been duly authorized to
so execute by all requisite corporate action. The validity and enforceability
of any Guarantee shall not be affected by the fact that it is not affixed to any
particular Note. Each of the Subsidiary Guarantors hereby agrees that its
Guarantee set forth in Section 10.01 shall remain in full force and effect
notwithstanding any failure to endorse on each Note a notation of such
Guarantee.
If an Officer of a Subsidiary Guarantor whose signature is on this
Indenture or a Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which such Guarantee is endorsed or at any time
thereafter, such Subsidiary Guarantor's Guarantee of such Note shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the authentication thereof
hereunder, shall constitute due delivery of any Guarantee set forth in this
Indenture on behalf of each Subsidiary Guarantor.
Section 10.04. Release of Subsidiary Guarantors.
(a) If no Default or Event of Default exists under this Indenture or
would be caused thereby, upon (i) the sale or other disposition of all of the
Capital Stock of any Subsidiary Guarantor (or all or substantially all of the
assets of any Subsidiary Guarantor) by the Company or any of its Restricted
Subsidiaries, or (ii) the sale or disposition of all or substantially all of the
assets of any Subsidiary Guarantor in compliance with all of the terms of this
Indenture, such Subsidiary Guarantor's Guarantee shall be released, and such
Subsidiary Guarantor shall be deemed released from all obligations under this
Article Ten without any further action required on the part of the Trustee or
any Holder. If such Subsidiary Guarantor is not so released such Subsidiary
Guarantor or the entity surviving such Subsidiary Guarantor, as applicable,
shall remain or be liable under its Guarantee as provided in this Article Ten.
(b) The Trustee shall deliver an appropriate instrument evidencing the
release of the Subsidiary Guarantor upon receipt of a request by the Company or
the Subsidiary Guarantor accompanied by an Officers' Certificate and an Opinion
of Counsel certifying as to the compliance with this Section 10.04, provided the
legal counsel delivering such Opinion of Counsel may rely as to matters of fact
on one or more Officers' Certificates of the Company.
The Trustee shall execute any documents reasonably requested by the Company
or the Subsidiary Guarantor in order to evidence the release of the Subsidiary
Guarantor from its obligations under its Guarantee endorsed on the Notes and
under this Article Eleven.
Except as set forth in Articles Four and Five and this Section 10.04,
nothing contained in this Indenture or in any of the Notes shall prevent any
consolidation or merger of the Subsidiary Guarantor with or into the Company or
shall prevent any sale or conveyance of the property of the Subsidiary Guarantor
as an entirety or substantially as an entirety to the Company.
Section 10.05. Waiver of Subrogation.
Until this Indenture is discharged and all of the Notes are discharged and
paid in full, each Subsidiary Guarantor hereby irrevocably waives and agrees not
to exercise any claim or other rights which it may now or hereafter acquire
against the Company that arise from the existence, payment, performance or
enforcement of the Company's obligations under the Notes or this Indenture and
such Subsidiary Guarantor's obligations under this Guarantee and this Indenture,
in any such instance including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution, indemnification, and any right to
participate in any claim or remedy of the Holders against the Company, whether
or not such claim, remedy or right arises in equity, or under contract, statute
or common law, including, without limitation, the right to take or receive from
the Company, directly or indirectly, in cash or other property or by set-off or
in any other manner, payment or security on account of such claim or other
rights. If any amount shall be paid to any Subsidiary Guarantor in violation of
the preceding sentence and any amounts owing to the Trustee or the Holders of
Notes under the Notes, this Indenture, or any other document or instrument
delivered under or in connection with such agreements or instruments, shall not
have been paid in full, such amount shall have been deemed to have been paid to
such Subsidiary Guarantor for the benefit of, and held in trust for the benefit
of, the Trustee or the Holders and shall forthwith be paid to the Trustee for
the benefit of itself or such Holders to be credited and applied to the
obligations in favor of the Trustee or the Holders, as the case may be, whether
matured or unmatured, in accordance with the terms of this Indenture. Each
Subsidiary Guarantor acknowledges that it will receive direct and indirect
benefits from the financing arrangements contemplated by this Indenture and that
the waiver set forth in this Section 10.05 is knowingly made in contemplation of
such benefits.
Section 10.06. Immediate Payment.
Each Subsidiary Guarantor agrees to make immediate payment to the Trustee
on behalf of the Holders of all Obligations owing or payable to the respective
Holders upon receipt of a demand for payment therefor by the Trustee to such
Subsidiary Guarantor in writing.
Section 10.07. Obligations Continuing.
The obligations of each Subsidiary Guarantor hereunder shall be continuing
and shall remain in full force and effect until all the obligations have been
paid and satisfied in full. Each Subsidiary Guarantor agrees with the Trustee
that it will from time to time deliver to the Trustee suitable acknowledgments
of this continued liability hereunder.
Section 10.08. Obligations Reinstated.
The obligations of each Subsidiary Guarantor hereunder shall continue to be
effective or shall be reinstated, as the case may be, if at any time any payment
which would otherwise have reduced the obligations of any Subsidiary Guarantor
hereunder (whether such payment shall have been made by or on behalf of the
Company or by or on behalf of a Subsidiary Guarantor) is rescinded or reclaimed
from any of the Holders upon the insolvency, bankruptcy, liquidation or
reorganization of the Company or any Subsidiary Guarantor or otherwise, all as
though such payment had not been made. If demand for, or acceleration of the
time for, payment by the Company is stayed upon the insolvency, bankruptcy,
liquidation or reorganization of the Company, all such Indebtedness otherwise
subject to demand for payment or acceleration shall nonetheless be payable by
each Subsidiary Guarantor as provided herein.
Section 10.09. Obligations Not Affected.
The obligations of each Subsidiary Guarantor hereunder shall not be
affected, impaired or diminished in any way by any act, omission, matter or
thing whatsoever, occurring before, upon or after any demand for payment
hereunder (and whether or not known or consented to by any Subsidiary Guarantor
or any of the Holders) which, but for this provision, might constitute a whole
or partial defense to a claim against any Subsidiary Guarantor hereunder or
might operate to release or otherwise exonerate any Subsidiary Guarantor from
any of its obligations hereunder or otherwise affect such obligations, whether
occasioned by default of any of the Holders or otherwise.
Section 10.10. Waiver.
Without in any way limiting the provisions of Section 10.01 hereof, each
Subsidiary Guarantor hereby waives notice or proof of reliance by the Holders
upon the obligations of any Subsidiary Guarantor hereunder, and diligence,
presentment, demand for payment on the Company, protest or notice of dishonor of
any of the Obligations, or other notice or formalities to the Company of any
kind whatsoever.
Section 10.11. No Obligation To Take Action.
Neither the Trustee nor any other Person shall have any obligation to
enforce or exhaust any rights or remedies or to take any other steps under any
security for the Obligations or against the Company or any other Person or any
property of the Company or any other Person before the Trustee is entitled to
demand payment and performance by any or all Subsidiary Guarantors of their
liabilities and obligations under their Guarantees or under this Indenture.
Section 10.12. Dealing with the Company and Others.
The Holders, without releasing, discharging, limiting or otherwise
affecting in whole or in part the obligations and liabilities of any Subsidiary
Guarantor hereunder and without the consent of or notice to any Subsidiary
Guarantor, may
(a) grant time, renewals, extensions, compromises, concessions, waivers,
releases, discharges and other indulgences to the Company or any other Person;
(b) take or abstain from taking security or collateral from the Company
or from perfecting security or collateral of the Company;
(c) release, discharge, compromise, realize, enforce or otherwise deal
with or do any act or thing in respect of (with or without consideration) any
and all collateral, mortgages or other security given by the Company or any
third party with respect to the obligations or matters contemplated by this
Indenture or the Notes;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or from any
security upon such part of the Obligations as the Holders may see fit or change
any such application in whole or in part from time to time as the Holders may
see fit; and
(f) otherwise deal with, or waive or modify their right to deal with, the
Company and all other Persons and any security as the Holders or the Trustee may
see fit.
Section 10.13. Default and Enforcement.
If any Subsidiary Guarantor fails to pay in accordance with Section 10.06,
the Trustee may proceed in its name as trustee hereunder in the enforcement of
the Guarantee of any such Subsidiary Guarantor and such Subsidiary Guarantor's
obligations thereunder and hereunder by any remedy provided by law, whether by
legal proceedings or otherwise, and to recover from such Subsidiary Guarantor
the obligations.
Section 10.14. Amendment, Etc.
No amendment, modification or waiver of any provision of this Indenture
relating to any Subsidiary Guarantor or consent to any departure by any
Subsidiary Guarantor or any other Person from any such provision will in any
event be effective unless it is signed by such Subsidiary Guarantor and the
Trustee.
Section 10.15. Acknowledgment.
Each Subsidiary Guarantor hereby acknowledges communication of the terms of
this Indenture and the Notes and consents to and approves of the same.
Section 10.16. Costs and Expenses.
Each Subsidiary Guarantor shall pay on demand by the Trustee any and all
costs, fees and expenses (including, without limitation, legal fees) incurred by
the Trustee, its agents, advisors and counsel or any of the Holders in enforcing
any of their rights under any Guarantee.
Section 10.17. No Waiver; Cumulative Remedies.
No failure to exercise and no delay in exercising, on the part of the
Trustee or the Holders, any right, remedy, power or privilege hereunder or under
this Indenture or the Notes, shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or privilege hereunder or
under this Indenture or the Notes preclude any other or further exercise thereof
or the exercise of any other right, remedy, power or privilege. The rights,
remedies, powers and privileges in the Guarantee and under this Indenture, the
Notes and any other document or instrument between a Subsidiary Guarantor and/or
the Company and the Trustee are cumulative and not exclusive of any rights,
remedies, powers and privilege provided by law.
Section 10.18. Survival of Obligations.
Without prejudice to the survival of any of the other obligations of each
Subsidiary Guarantor hereunder, the obligations of each Subsidiary Guarantor
under Section 10.01 shall be enforceable against such Subsidiary Guarantor
without regard to and without giving effect to any right of offset or
counterclaim available to or which may be asserted by the Company or any
Subsidiary Guarantor.
Section 10.19. Guarantee in Addition to Other Obligations.
The obligations of each Subsidiary Guarantor under its Guarantee and this
Indenture are in addition to and not in substitution for any other obligations
to the Trustee or to any of the Holders in relation to this Indenture or the
Notes (including the Registration Rights Agreement).
Section 10.20. Severability.
Any provision of this Article Ten which is prohibited or unenforceable in
any jurisdiction shall not invalidate the remaining provisions and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction unless its removal
would substantially defeat the basic intent, spirit and purpose of this
Indenture and this Article Ten.
Section 10.21. Successors and Assigns.
Each Guarantee shall be binding upon and inure to the benefit of each
Subsidiary Guarantor and the Trustee and the other Holders and their respective
successors and permitted assigns, except that no Subsidiary Guarantor may assign
any of its obligations hereunder or thereunder.
ARTICLE ELEVEN
SUBORDINATION
Section 11.01. Notes Subordinated to Senior Debt.
The Company covenants and agrees, and each Holder of the Notes, by its
acceptance thereof, likewise covenants and agrees, that all Notes shall be
issued subject to the provisions of this Article Eleven; and each Person holding
any Note, whether upon original issue or upon transfer, assignment or exchange
thereof, accepts and agrees that the payment of all Obligations on the Notes by
the Company shall, to the extent and in the manner herein set forth, be
subordinated in right of payment to the prior payment in full in cash or Cash
Equivalents of all Obligations on Senior Debt, whether outstanding on the Issue
Date or thereafter incurred, including without limitation the Company's
Obligations under the Amended Credit Facility; that the subordination is for the
benefit of, and shall be enforceable directly by, the holders of Senior Debt,
and that each holder of Senior Debt whether now outstanding or hereafter
created, incurred, assumed or guaranteed shall be deemed to have acquired Senior
Debt in reliance upon the covenants and provisions contained in this Indenture
and the Notes.
Section 11.02. No Payment on Notes in Certain Circumstances.
(a) If any default occurs and is continuing in the payment when due,
whether at stated maturity, upon any redemption, by declaration or otherwise, of
any principal of, interest on, unpaid drawings for letters of credit issued in
respect of, or regularly accruing fees with respect to, any Senior Debt, no
payment of any kind or character shall be made by or on behalf of the Company or
any other Person on its or their behalf with respect to any Obligations on the
Notes or to acquire any of the Notes for cash or property or otherwise. In
addition, if any other event of default occurs and is continuing with respect to
any Designated Senior Debt, as such event of default is defined in the
instrument creating or evidencing such Designated Senior Debt, permitting the
holders of such Designated Senior Debt then outstanding to accelerate the
maturity thereof and if the Representative for the respective issue of
Designated Senior Debt gives written notice of the event of default to the
Trustee (a "Default Notice"), then, unless and until all events of default have
been cured or waived or have ceased to exist or the Trustee receives notice from
the Representative for the respective issue of Designated Senior Debt
terminating the Blockage Period (as defined below), during the 180 days after
the delivery of such Default Notice (the "Blockage Period"), neither the Company
nor any other Person on its behalf shall (x) make any payment of any kind or
character with respect to any Obligations on the Notes or (y) acquire any of the
Notes for cash or property or otherwise. Notwithstanding anything herein to the
contrary, in no event will a Blockage Period extend beyond 180 days from the
date the payment on the Notes was due and only one such Blockage Period may be
commenced within any 360 consecutive days. No event of default which existed or
was continuing on the date of the commencement of any Blockage Period with
respect to the Designated Senior Debt shall be, or be made, the basis for
commencement of a second Blockage Period by the Representative of such
Designated Senior Debt whether or not within a period of 360 consecutive days,
unless such event of default shall have been cured or waived for a period of not
less than 90 consecutive days (it being acknowledged that any subsequent action,
or any breach of any financial covenants for a period commencing after the date
of commencement of such Blockage Period that, in either case, would give rise to
an event of default pursuant to any provisions under which an event of default
previously existed or was continuing shall constitute a new event of default for
this purpose).
(b) In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder when such payment is prohibited by
Section 11.02(a), such payment shall be held in trust for the benefit of, and
shall be paid over or delivered to, the holders of Senior Debt (pro rata to such
holders on the basis of the respective amount of Senior Debt held by such
holders) or their respective Representatives, as their respective interests may
appear. The Trustee shall be entitled to rely on information regarding amounts
then due and owing on the Senior Debt, if any, received from the holders of
Senior Debt (or their Representatives) or, if such information is not received
from such holders or their Representatives, from the Company and only amounts
included in the information provided to the Trustee shall be paid to the holders
of Senior Debt.
Nothing contained in this Article Eleven shall limit the right of the
Trustee or the Holders of Notes to take any action to accelerate the maturity of
the Notes pursuant to Section 6.02 or to pursue any rights or remedies
hereunder; provided, that all Senior Debt thereafter due or then or thereafter
declared to be due shall first be paid in full in cash or Cash Equivalents
before the Holders are entitled to receive any payment of any kind or character
with respect to Obligations on the Notes.
Section 11.03. Payment Over of Proceeds upon Dissolution, Etc.
(a) Upon any payment or distribution of assets of the Company of any kind
or character, whether in cash, property or securities, to creditors upon any
total or partial liquidation, dissolution, winding up, reorganization,
assignment for the benefit of creditors or marshaling of assets of the Company
or in a bankruptcy, reorganization, insolvency, receivership or other similar
proceeding relating to the Company or its property, whether voluntary or
involuntary, all Obligations due or to become due upon all Senior Debt shall
first be paid in full in cash or Cash Equivalents, or such payment duly provided
for to the satisfaction of the holders of such Senior Debt, before any payment
or distribution of any kind or character is made on account of any Obligations
on the Notes, or for the acquisition of any of the Notes for cash or property or
otherwise. Upon any such dissolution, winding-up, liquidation, reorganization,
receivership or similar proceeding, any payment or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
which the Holders of the Notes or the Trustee under this Indenture would be
entitled, except for the provisions hereof, shall be paid by the Company or by
any receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution, or by the Holders or by the Trustee under
this Indenture if received by them, directly to the holders of Senior Debt (pro
rata to such holders on the basis of the respective amounts of Senior Debt held
by such holders) or their respective Representatives, or to the trustee or
trustees under any indenture pursuant to which any of such Senior Debt may have
been issued, as their respective interests may appear, for application to the
payment of Senior Debt remaining unpaid until all such Senior Debt has been paid
in full in cash or Cash Equivalents after giving effect to any concurrent
payment, distribution or provision therefor to or for the holders of Senior
Debt.
(b) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, shall be received by the Trustee or any Holder when such
payment or distribution is prohibited by this Section 11.03, such payment or
distribution shall be held in trust for the benefit of, and shall be paid over
or delivered to, the holders of Senior Debt (pro rata to such holders) or their
respective Representatives, or to the trustee or trustees under any indenture
pursuant to which any of such Senior Debt may have been issued, as their
respective interests may appear, for application to the payment of Senior Debt
remaining unpaid until all such Senior Debt has been paid in full in cash or
Cash Equivalents, after giving effect to any concurrent payment, distribution or
provision therefor to or for the holders of such Senior Debt.
(c) The consolidation of the Company with, or the merger of the Company
with or into, another corporation or the liquidation or dissolution of the
Company following the conveyance or transfer of all or substantially all of its
assets, to another corporation upon the terms and conditions provided in Article
Five and as long as permitted under the terms of the Senior Debt shall not be
deemed a dissolution, winding-up, liquidation or reorganization for the purposes
of this Section if such other corporation shall, as part of such consolidation,
merger, conveyance or transfer, assume the Company's obligations hereunder in
accordance with Article Five hereof.
Section 11.04. Payments May Be Paid Prior to Dissolution.
Nothing contained in this Article Eleven or elsewhere in this Indenture
shall prevent (i) the Company, except under the conditions described in Sections
11.02 and 11.03, from making payments at any time for the purpose of making
payments of principal of and interest on the Notes, or from depositing with the
Trustee any moneys for such payments, or (ii) in the absence of actual knowledge
by the Trustee that a given payment would be prohibited by Section 11.02 or
11.03, the application by the Trustee of any moneys deposited with it for the
purpose of making such payments of principal of, and interest on, the Notes to
the Holders entitled thereto unless at least two Business Days prior to the date
upon which such payment would otherwise become due and payable a Trust Officer
shall have actually received the written notice provided for in the second
sentence of Section 11.02(a) or in Section 11.07 (provided that, notwithstanding
the foregoing, such application shall otherwise be subject to the provisions of
the first sentence of Section 11.02(a) and Section 11.03). The Company shall
give prompt written notice to the Trustee of any dissolution, winding-up,
liquidation or reorganization of the Company.
Section 11.05. Subrogation.
Subject to the payment in full in cash or Cash Equivalents of all Senior
Debt, the Holders of the Notes shall be subrogated to the rights of the holders
of Senior Debt to receive payments or distributions of cash, property or
securities of the Company applicable to the Senior Debt until the Notes shall be
paid in full; and, for the purposes of such subrogation, no such payments or
distributions to the holders of the Senior Debt by or on behalf of the Company
or by or on behalf of the Holders by virtue of this Article Eleven which
otherwise would have been made to the Holders shall, as between the Company and
the Holders of the Notes, be deemed to be a payment by the Company to or on
account of the Senior Debt, it being understood that the provisions of this
Article Eleven are and are intended solely for the purpose of defining the
relative rights of the Holders of the Notes, on the one hand, and the holders of
the Senior Debt, on the other hand.
Section 11.06. Obligations of the Company Unconditional.
Nothing contained in this Article Eleven or elsewhere in this Indenture or
in the Notes is intended to or shall impair, as among the Company, its creditors
other than the holders of Senior Debt, and the Holders, the obligation of the
Company, which is absolute and unconditional, to pay to the Holders the
principal of and any interest on the Notes as and when the same shall become due
and payable in accordance with their terms, or is intended to or shall affect
the relative rights of the Holders and creditors of the Company other than the
holders of the Senior Debt, nor shall anything herein or therein prevent the
Holder of any Note or the Trustee on its behalf from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture, subject
to the rights, if any, of the holders of Senior Debt in respect of cash,
property or securities of the Company received upon the exercise of any such
remedy.
Section 11.07. Notice to Trustee.
The Company shall give prompt written notice to the Trustee of any fact
known to the Company which would prohibit the making of any payment to or by the
Trustee in respect of the Notes pursuant to the provisions of this Article
Eleven. Regardless of anything to the contrary contained in this Article Eleven
or elsewhere in this Indenture, the Trustee shall not be charged with knowledge
of the existence of any default or event of default with respect to any Senior
Debt or of any other facts which would prohibit the making of any payment to or
by the Trustee unless and until the Trustee shall have received notice in
writing from the Company, or from a holder of Senior Debt or a Representative
therefor, together with proof satisfactory to the Trustee of such holding of
Senior Debt or of the authority of such Representative, and, prior to the
receipt of any such written notice, the Trustee shall be entitled to assume (in
the absence of actual knowledge to the contrary) that no such facts exist.
In the event that the Trustee determines in good faith that any evidence is
required with respect to the right of any Person as a holder of Senior Debt to
participate in any payment or distribution pursuant to this Article Eleven, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amounts of Senior Debt held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article Eleven, and if such evidence is not furnished the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.
Section 11.08. Reliance on Judicial Order or Certificate of
Liquidating Agent.
Upon any payment or distribution of assets of the Company referred to in
this Article Eleven, the Trustee, subject to the provisions of Sections 7.01 and
7.02, and the Holders of the Notes shall be entitled to rely upon any order or
decree made by any court of competent jurisdiction in which any insolvency,
bankruptcy, receivership, dissolution, winding-up, liquidation, reorganization
or similar case or proceeding is pending, or upon a certificate of the receiver,
trustee in bankruptcy, liquidating trustee, receiver, assignee for the benefit
of creditors, agent or other person making such payment or distribution,
delivered to the Trustee or the Holders of the Notes, for the purpose of
ascertaining the persons entitled to participate in such payment or
distribution, the holders of the Senior Debt and other Indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article
Eleven.
Section 11.09. Application by Trustee of Assets Deposited with It.
U.S. Legal Tender or U.S. Government Obligations deposited in trust with
the Trustee pursuant to and in accordance with Sections 8.01 and 8.02 shall be
for the sole benefit of the Holders of the Notes and, to the extent allocated
for the payment of Notes, shall not be subject to the subordination provisions
of this Article Eleven. Otherwise, any deposit of assets or securities by or on
behalf of the Company with the Trustee or any Paying Agent (whether or not in
trust) for the payment of principal of or interest on any Notes shall be subject
to the provisions of this Article Eleven; provided, however, that if prior to
the second Business Day preceding the date on which by the terms of this
Indenture any such assets may become distributable for any purpose (including,
without limitation, the payment of either principal of or interest on any Note)
the Trustee or such Paying Agent shall not have received with respect to such
assets the notice provided for in Section 11.07, then the Trustee or such Paying
Agent shall have full power and authority to receive such assets and to apply
the same to the purpose for which they were received, and shall not be affected
by any notice to the contrary received by it on or after such date. The
foregoing shall not apply to the Paying Agent if the Company or any Subsidiary
or Affiliate of the Company is acting as Paying Agent. Nothing contained in
this Section 11.09 shall limit the right of the holders of Senior Debt to
recover payments as contemplated by this Article Eleven.
Section 11.10. Trustee's Relation to Senior Debt.
The Trustee and any agent of the Company or the Trustee shall be entitled
to all the rights set forth in this Article Eleven with respect to any Senior
Debt which may at any time be held by it in its individual or any other capacity
to the same extent as any other holder of Senior Debt and nothing in this
Indenture shall deprive the Trustee or any such agent of any of its rights as
such holder.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article Eleven, and no implied covenants or
obligations with respect to the holders of Senior Debt shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt.
Whenever a distribution is to be made or a notice given to holders or
owners of Senior Debt, the distribution may be made and the notice may be given
to their Representative, if any.
Section 11.11. Subordination Rights Not Impaired by Acts or Omissions
of the Company or Holders of Senior Debt.
No right of any present or future holders of any Senior Debt to enforce
subordination as provided herein shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance by
the Company with the terms of this Indenture, regardless of any knowledge
thereof with which any such holder may have or otherwise be charged.
Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee, without incurring responsibility to the
Trustee or the Holders of the Notes and without impairing or releasing the
subordination provided in this Article Eleven or the obligations hereunder of
the Holders of the Notes to the holders of the Senior Debt, do any one or more
of the following: (i) change the manner, place or terms of payment or extend the
time of payment of, or renew or alter, Senior Debt, or otherwise amend or
supplement in any manner Senior Debt, or any instrument evidencing the same or
any agreement under which Senior Debt is outstanding; (ii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Debt; (iii) release any Person liable in any manner for the
payment or collection of Senior Debt; and (iv) exercise or refrain from
exercising any rights against the Company and any other Person.
Section 11.12. Holders Authorize Trustee To Effectuate Subordination
of Notes.
Each Holder of Notes by its acceptance of them authorizes and expressly
directs the Trustee on its behalf to take such action as may be necessary or
appropriate to effectuate, as between the holders of Senior Debt and the Holders
of Notes, the subordination provided in this Article Eleven, and appoints the
Trustee its attorney-in-fact for such purposes, including, in the event of any
dissolution, winding-up, liquidation or reorganization of the Company (whether
in bankruptcy, insolvency, receivership, reorganization or similar proceedings
or upon an assignment for the benefit of creditors or otherwise) tending towards
liquidation of the business and assets of the Company, the filing of a claim for
the unpaid balance of its Notes and accrued interest in the form required in
those proceedings.
If the Trustee does not file a proper claim or proof of debt in the form
required in such proceedings prior to 30 days before the expiration of the time
to file such claim or claims, then holders of the Senior Debt or their
Representative are or is hereby authorized to have the right to file and are or
is hereby authorized to file an appropriate claim for and on behalf of the
Holders of said Notes. Nothing herein contained shall be deemed to authorize
the Trustee or the holders of Senior Debt or their Representative to authorize
or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee or the holders of
Senior Debt or their Representative to vote in respect of the claim of any
Holder in any such proceeding.
Section 11.13. This Article Eleven Not To Prevent Events of Default.
The failure to make a payment on account of principal of or interest on the
Notes by reason of any provision of this Article Eleven will not be construed as
preventing the occurrence of any Event of Default.
Nothing contained in this Article Eleven shall limit the right of the
Trustee or the Holders of Notes to take any action to accelerate the maturity of
the Notes pursuant to Article Six or to pursue any rights or remedies hereunder
or under applicable law, subject to the rights, if any, under this Article
Eleven of the holders, from time to time, of Senior Debt.
Section 11.14. Trustee's Compensation Not Prejudiced.
Nothing in this Article Eleven will apply to amounts due to the Trustee in
its capacity as such pursuant to Section 7.07.
ARTICLE TWELVE
SUBORDINATION OF GUARANTEES
Section 12.01. Obligations of Guarantors Subordinated to
Guarantor Senior Debt.
Anything herein to the contrary notwithstanding, each of the Subsidiary
Guarantors, for itself and its successors, covenants and agrees, and each Holder
of the Notes, by its acceptance thereof, likewise covenants and agrees that the
payment of all Obligations owing to the Holders in respect of its Guarantee
(collectively, as to any Subsidiary Guarantor, its "Guarantee Obligations")
shall be subject to the provisions of this Article Twelve; and each Person
holding any Note, whether upon original issue or upon transfer, assignment or
exchange thereof, accepts and agrees that the payment of all Guarantee
Obligations shall, to the extent and in the manner herein set forth, be
subordinated in right of payment to the prior payment in full in cash or Cash
Equivalents of all Obligations on Guarantor Senior Debt, whether outstanding on
the Issue Date or thereafter incurred, including without limitation the
Subsidiary Guarantors' Obligations under the Amended Credit Facility; that the
subordination is for the benefit of, and shall be enforceable directly by, the
holders of Guarantor Senior Debt, and that each holder of Guarantor Senior Debt
whether now outstanding or hereafter created, incurred, assumed or guaranteed
shall be deemed to have acquired Guarantor Senior Debt in reliance upon the
covenants and provisions contained in this Indenture and the Notes.
Section 12.02. Suspension of Guarantee Obligations When Guarantor
Senior Debt is in Default.
(a) If any default occurs and is continuing in the payment when due,
whether at maturity, upon any redemption, by declaration or otherwise, of any
principal of, interest on, unpaid drawings for letters of credit issued in
respect of, or regularly accruing fees with respect to, any Guarantor Senior
Debt of a Subsidiary Guarantor or guaranteed by a Subsidiary Guarantor, no
payment of any kind or character shall be made by or on behalf of such
Subsidiary Guarantor or any other Person on its or their behalf with respect to
any Guarantee Obligations on the Notes or to acquire any of the Notes for cash
or property or otherwise. In addition, if any other event of default occurs and
is continuing with respect to any Guarantor Senior Debt which is Designated
Senior Debt, as such event of default is defined in the instrument creating or
evidencing such Guarantor Senior Debt, permitting the holders of such Guarantor
Senior Debt then outstanding to accelerate the maturity thereof and if the
Representative for the respective issue of Guarantor Senior Debt gives a Default
Notice, then, unless and until all events of default have been cured or waived
or have ceased to exist or the Trustee receives notice from the Representative
for the respective issue of Guarantor Senior Debt terminating the Blockage
Period, during the Blockage Period, neither any Subsidiary Guarantor nor any
other Person on its behalf shall (x) make any payment of any kind or character
with respect to any Guarantee Obligations on the Notes or (y) acquire any of the
Notes for cash or property or otherwise. Notwithstanding anything herein to the
contrary, in no event will a Blockage Period extend beyond 180 days from the
date the payment on the Notes was due and only one such Blockage Period may be
commenced within any 360 consecutive days. No event of default which existed or
was continuing on the date of the commencement of any Blockage Period with
respect to the Guarantor Senior Debt shall be, or be made, the basis for
commencement of a second Blockage Period by the Representative of such Guarantor
Senior Debt whether or not within a period of 360 consecutive days, unless such
event of default shall have been cured or waived for a period of not less than
90 consecutive days (it being acknowledged that any subsequent action, or any
breach of any financial covenants for a period commencing after the date of
commencement of such Blockage Period, that in either case, would give rise to an
event of default pursuant to any provisions under which an event of default
previously existed or was continuing shall constitute a new event of default for
this purpose).
(b) In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder when such payment is prohibited by
Section 12.02(a), such payment shall be held in trust for the benefit of, and
shall be paid over or delivered to, the holders of Guarantor Senior Debt (pro
rata to such holders on the basis of the respective amount of Guarantor Senior
Debt held by such holders) or their respective Representatives, as their
respective interests may appear. The Trustee shall be entitled to rely on
information regarding amounts then due and owing on the Guarantor Senior Debt,
if any, received from the holders of Guarantor Senior Debt (or their
Representatives) or, if such information is not received from such holders or
their Representatives, from the Company, the respective Subsidiary Guarantor and
only amounts included in the information provided to the Trustee shall be paid
to the holders of Guarantor Senior Debt.
Nothing contained in this Article Twelve shall limit the right of the
Trustee or the Holders of Notes to take any action to accelerate the maturity of
the Notes pursuant to Section 6.02 or to pursue any rights or remedies
hereunder; provided, that all Guarantor Senior Debt thereafter due or then or
thereafter declared to be due shall first be paid in full in cash or Cash
Equivalents before the Holders are entitled to receive any payment of any kind
or character with respect to Obligations on the Notes.
Section 12.03. Guarantee Obligations Subordinated to Prior Payment
of All Guarantor Senior Debt on Dissolution, Liquidation
or Reorganization of Such Subsidiary Guarantor.
Upon any payment or distribution of assets of any Subsidiary Guarantor of
any kind or character, whether in cash, property or securities to creditors upon
any total or partial liquidation, dissolution, winding up, reorganization,
assignment for the benefit of creditors or marshaling of assets of such
Subsidiary Guarantor, whether voluntary or involuntary, or in a bankruptcy,
reorganization, insolvency, receivership or other similar proceeding relating to
any Subsidiary Guarantor or its property, whether voluntary or involuntary, but
excluding any liquidation or dissolution of a Subsidiary Guarantor into the
Company or into another Subsidiary Guarantor:
(a) the holders of all Guarantor Senior Debt of such Subsidiary
Guarantor shall first be entitled to receive payments in full in cash
or Cash Equivalents, or such payment duly provided for to the
satisfaction of the holders of Guarantor Senior Debt, of all amounts
payable under Guarantor Senior Debt before the Holders will be
entitled to receive any payment or distribution of any kind or
character on account of the Guarantee of such Subsidiary Guarantor,
and until all Obligations with respect to the Guarantor Senior Debt
are paid in full in cash or Cash Equivalents, or such payment duly
provided for to the satisfaction of the holders of Guarantor Senior
Debt, any distribution to which the Holders would be entitled shall be
made to the holders of Guarantor Senior Debt of such Subsidiary
Guarantor;
(b) any payment or distribution of assets of such Subsidiary
Guarantor of any kind or character, whether in cash, property or
securities, to which the Holders or the Trustee on behalf of the
Holders would be entitled except for the provisions of this Article
Twelve shall be paid by the liquidating trustee or agent or other
Person making such a payment or distribution, directly to the holders
of Guarantor Senior Debt of such Subsidiary Guarantor or their
Representatives, ratably according to the respective amounts of such
Guarantor Senior Debt remaining unpaid held or represented by each,
until all such Guarantor Senior Debt remaining unpaid shall have been
paid in full in cash or Cash Equivalents, after giving effect to any
concurrent payment or distribution to the holders of such Guarantor
Senior Debt; and
(c) in the event that, notwithstanding the foregoing, any
payment or distribution of assets of such Subsidiary Guarantor of any
kind or character, whether in cash, property or securities, shall be
received by the Trustee or any Holders when such payment or
distribution is prohibited by this Section 12.03, such payment or
distribution shall be received, segregated from other funds, and held
in trust by the Trustee or such Holder or Paying Agent for the benefit
of, and shall immediately be paid over by the Trustee or by the Holder
to, the holders of such Guarantor Senior Debt or their
Representatives, ratably according to the respective amounts of such
Guarantor Senior Debt held or represented by each, until all such
Guarantor Senior Debt remaining unpaid shall have been paid in full in
cash or Cash Equivalents, after giving effect to any concurrent
payment or distribution to the holders of Guarantor Senior Debt.
Each Subsidiary Guarantor shall give prompt notice to the Trustee prior to
any dissolution, winding-up, total or partial liquidation or reorganization
(including, without limitation, in bankruptcy, insolvency, or receivership
proceedings or upon any assignment for the benefit or creditors or any other
marshaling of such Subsidiary Guarantor's assets and liabilities).
Section 12.04. Holders of Guarantee Obligations To Be Subrogated
to Rights of Holders of Guarantor Senior Debt.
Subject to the payment in full in cash or Cash Equivalents of all Guarantor
Senior Debt, the Holders of Guarantee Obligations of a Subsidiary Guarantor
shall be subrogated to the rights of the holders of Guarantor Senior Debt of
such Subsidiary Guarantor to receive payments or distributions of assets of such
Subsidiary Guarantor applicable to such Guarantor Senior Debt until all amounts
owing on or in respect of the Guarantee Obligations shall be paid in full, and
for the purpose of such subrogation no payments or distributions to the holders
of such Guarantor Senior Debt by or on behalf of such Subsidiary Guarantor, or
by or on behalf of the Holders by virtue of this Article Twelve, which otherwise
would have been made to the Holders shall, as between such Subsidiary Guarantor
and the Holders, be deemed to be payment by such Subsidiary Guarantor to or on
account of such Guarantor Senior Debt, it being understood that the provisions
of this Article Twelve are and are intended solely for the purpose of defining
the relative rights of the Holders, on the one hand, and the holders of such
Guarantor Senior Debt, on the other hand.
Each Holder by purchasing or accepting a Note waives any and all notice of
the creation, modification, renewal, extension or accrual of any Guarantor
Senior Debt of the Subsidiary Guarantors and notice of or proof of reliance by
any holder or owner of Guarantor Senior Debt of the Subsidiary Guarantors upon
this Article Twelve and the Guarantor Senior Debt of the Subsidiary Guarantors
shall conclusively be deemed to have been created, contracted or incurred in
reliance upon this Article Twelve, and all dealings between the Subsidiary
Guarantors and the holders and owners of the Guarantor Senior Debt of the
Subsidiary Guarantors shall be deemed to have been consummated in reliance upon
this Article Twelve.
Section 12.05. Obligations of the Subsidiary Guarantors
Unconditional.
Nothing contained in this Article Twelve or elsewhere in this Indenture or
in the Guarantees is intended to or shall impair, as between the Subsidiary
Guarantors and the Holders, the obligation of the Subsidiary Guarantors, which
is absolute and unconditional, to pay to the Holders all amounts due and payable
under the Guarantees as and when the same shall become due and payable in
accordance with their terms, or is intended to or shall affect the relative
rights of the Holders and creditors of the Subsidiary Guarantors other than the
holders of the Guarantor Senior Debt, nor shall anything herein or therein
prevent the Trustee or any Holder from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article Twelve, of the holders of Guarantor Senior
Debt in respect of cash, property or securities of the Subsidiary Guarantors
received upon the exercise of any such remedy. Upon any payment or distribution
of assets of any Subsidiary Guarantor referred to in this Article Twelve, the
Trustee, subject to the provisions of Sections 7.01 and 7.02, and the Holders
shall be entitled to rely upon any order or decree made by any court of
competent jurisdiction in which any liquidation, dissolution, winding-up or
reorganization proceedings are pending, or a certificate of the receiver,
trustee in bankruptcy, liquidating trustee or agent or other Person making any
payment or distribution to the Trustee or to the Holders for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of Guarantor Senior Debt and other Indebtedness of any
Subsidiary Guarantor, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent thereto or to
this Article Twelve. Nothing in this Article Twelve shall apply to the claims
of, or payments to, the Trustee in its capacity as such under or pursuant to
Section 7.07. The Trustee shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself or itself to be a holder of any
Guarantor Senior Debt (or a trustee on behalf of, or other Representative of,
such holder) to establish that such notice has been given by a holder of such
Guarantor Senior Debt or a trustee or representative on behalf of any such
holder.
In the event that the Trustee determines in good faith that any evidence is
required with respect to the right of any Person as a holder of Guarantor Senior
Debt to participate in any payment or distribution pursuant to this Article
Twelve, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Guarantor Senior Debt
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and any other facts pertinent to the rights of
such Person under this Article Twelve, and if such evidence is not furnished,
the Trustee may defer any payment to such Person pending judicial determination
as to the right of such Person to receive such payment.
Section 12.06. Trustee Entitled To Assume Payments Not Prohibited In
Absence of Notice.
The Trustee shall not at any time be charged with knowledge of the
existence of any facts that would prohibit the making of any payment to or by
the Trustee unless and until the Trustee or any Paying Agent shall have received
notice thereof from the Company or any Subsidiary Guarantor or from one or more
holders of Guarantor Senior Debt or from any Representative therefor and, prior
to the receipt of any such notice, the Trustee, subject to the provisions of
Sections 7.01 and 7.02, shall be entitled in all respects conclusively to assume
that no such fact exists.
Section 12.07. Application by Trustee of Assets Deposited with It.
U.S. Legal Tender or U.S. Government Obligations deposited in trust with
the Trustee pursuant to and in accordance with Sections 8.01 and 8.02 shall be
for the sole benefit of Holders of the Notes and, to the extent allocated for
the payment of Notes, shall not be subject to the subordination provisions of
this Article Twelve. Otherwise, any deposit of assets or securities by or on
behalf of a Subsidiary Guarantor with the Trustee or any Paying Agent (whether
or not in trust) for payment of the Guarantees shall be subject to the
provisions of this Article Twelve; provided, however, that if prior to the
second Business Day preceding the date on which by the terms of this Indenture
any such assets may become distributable for any purpose (including, without
limitation, the payment of either principal of or interest on any Note) the
Trustee or such Paying Agent shall not have received with respect to such assets
the notice provided for in Section 12.06, then the Trustee or such Paying Agent
shall have full power and authority to receive such assets and to apply the same
to the purpose for which they were received, and shall not be affected by an
notice to the contrary received by it on or after such date. The foregoing
shall not apply to the Paying Agent if the Company or any Subsidiary or
Affiliate of the Company is acting as Paying Agent. Nothing contained in this
Section 12.07 shall limit the right of the holders of Guarantor Senior Debt to
recover payments as contemplated by this Article Twelve.
Section 12.08. No Waiver of Subordination Provisions.
(a) No right of any present or future holder of any Guarantor Senior Debt
to enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of any
Subsidiary Guarantor or by any act or failure to act, by any such holder, or by
any non-compliance by any Subsidiary Guarantor with the terms, provisions and
covenants of this Indenture, regardless of any knowledge thereof any such holder
may have or be otherwise charged with.
(b) Without limiting the generality of subsection (a) of this Section
12.08, the holders of Guarantor Senior Debt may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Notes, without incurring responsibility to the Holders of the Notes and without
impairing or releasing the subordination provided in this Article Twelve or the
obligations hereunder of the Holders of the Notes to the holders of Guarantor
Senior Debt, do any one or more of the following: (1) change the manner, place,
terms or time of payment of, or renew or alter, Guarantor Senior Debt or any
instrument evidencing the same or any agreement under which Guarantor Senior
Debt is outstanding; (2) sell, exchange, release or otherwise deal with any
property pledged, mortgaged or otherwise securing Guarantor Senior Debt; (3)
release any Person liable in any manner for the collection or payment of
Guarantor Senior Debt; and (4) exercise or refrain from exercising any rights
against the Subsidiary Guarantors and any other Person.
Section 12.09. Holders Authorize Trustee To Effectuate Subordination
of Guarantee Obligations.
Each Holder of the Guarantee Obligations by its acceptance thereof
authorizes and expressly directs the Trustee on its behalf to take such action
as may be necessary or appropriate to effect the subordination provisions
contained in this Article Twelve, and appoints the Trustee its attorney-in-fact
for such purpose, including, in the event of any liquidation, dissolution,
winding-up, reorganization, assignment for the benefit of creditors or
marshaling of assets of any Subsidiary Guarantor tending towards liquidation or
reorganization of the business and assets of any Subsidiary Guarantor, the
immediate filing of a claim for the unpaid balance under its or his Guarantee
Obligations in the form required in said proceedings and cause said claim to be
approved. If the Trustee does not file a proper claim or proof of debt in the
form required in such proceeding prior to 30 days before the expiration of the
time to file such claim or claims, then any of the holders of the Guarantor
Senior Debt or their Representative is hereby authorized to file an appropriate
claim for and on behalf of the Holders of said Guarantee Obligations. Nothing
herein contained shall be deemed to authorize the Trustee or the holders of
Guarantor Senior Debt or their Representative to authorize or consent to or
accept or adopt on behalf of any holder of Guarantee Obligations any plan of
reorganization, arrangement, adjustment or composition affecting the Guarantee
Obligations or the rights of any Holder thereof, or to authorize the Trustee or
the holders of Guarantor Senior Debt or their Representative to vote in respect
of the claim of any holder of Guarantee Obligations in any such proceeding.
Section 12.10. Right of Trustee to Hold Guarantor Senior Debt
The Trustee shall be entitled to all of the rights set forth in this
Article Twelve in respect of any Guarantor Senior Debt at any time held by it to
the same extent as any other holder of Guarantor Senior Debt, and nothing in
this Indenture shall be construed to deprive the Trustee of any of its rights as
such holder.
With respect to the holders of Guarantor Senior Debt, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article Twelve, and no implied covenants
or obligations with respect to the holders of Guarantor Senior Debt shall be
read into this Indenture against the Trustee. The Trustee shall not be deemed
to owe any fiduciary duty to the holders of Guarantor Senior Debt.
Whenever a distribution is to be made or a notice given to holders or
owners of Guarantor Senior Debt, the distribution may be made and the notice may
be given to their agent or other representative, if any.
Section 12.11. No Suspension of Remedies.
The failure to make a payment in respect of the Guarantees by reason of any
provision of this Article Twelve shall not be construed as preventing the
occurrence of a Default or an Event of Default under Section 6.01.
Nothing contained in this Article Twelve shall limit the right of the
Trustee or the Holders of Notes to take any action to accelerate the maturity of
the Notes pursuant to Article Six or to pursue any rights or remedies hereunder
or under applicable law, subject to the rights, if any, under this Article
Twelve of the holders, from time to time, of Guarantor Senior Debt.
ARTICLE THIRTEEN
MISCELLANEOUS
Section 13.01. TIA Controls.
If any provision of this Indenture limits, qualifies, or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control; provided, however, that this Section 13.01
shall not of itself require that this Indenture or the Trustee be qualified
under the TIA or constitute any admission or acknowledgment by any party hereto
that any such qualification is required prior to the time this Indenture and the
Trustee are required by the TIA to be so qualified.
Section 13.02. Notices.
Any notices or other communications required or permitted hereunder shall
be in writing, and shall be sufficiently given if made by hand delivery, by
telex, by telecopier or registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
if to the Company or the Subsidiary Guarantors:
SITEL Corporation
7277 World Communication Drive
Omaha, NE 68122
Facsimile No.: (402) 963-2693
Attention: Chief Financial Officer
with a copy to:
SITEL Corporation
300 E. Lombard Street, Suite 850
Baltimore, MD 21202
Facsimile No.: (410) 659-5754
Attention: President
if to the Trustee:
The First National Bank of Maryland
25 South Charles Street
16th Floor
Baltimore, Maryland 21201
Facsimile No.: (410) 244-4236
Attention: Corporate Trust Administration
Each of the Company, the Subsidiary Guarantors and the Trustee by written
notice to each other may designate additional or different addresses for notices
to any Person. Any notice or communication to the Company, the Subsidiary
Guarantors or the Trustee shall be deemed to have been given or made as of the
date so delivered if hand delivered; when answered back, if telexed; when
receipt is acknowledged, if faxed; one (1) business day after mailing by
reputable overnight courier; and five (5) calendar days after mailing if sent by
registered or certified mail, postage prepaid (except that a notice of change of
address shall not be deemed to have been given until actually received by the
addressee).
Any notice or communication mailed to a Holder shall be mailed to him by
first class mail or other equivalent means at his address as it appears on the
registration books of the Registrar ten (10) days prior to such mailing and
shall be sufficiently given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Holder or any defect in it
shall not affect its sufficiency with respect to other Holders. If a notice or
communication is mailed in the manner provided above, it is duly given, whether
or not the addressee receives it.
Section 13.03. Communications by Holders with other Holders.
Holders may communicate pursuant to TIA 312(b) with other Holders with
respect to their rights under this Indenture or the Notes. The Company, the
Trustee, the Registrar and any other Person shall have the protection of TIA
312(c).
Section 13.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company or the Subsidiary Guarantors
to the Trustee to take any action under this Indenture, the Company shall
furnish to the Trustee:
(1) an Officers' Certificate, in form and substance satisfactory
to the Trustee, stating that, in the opinion of the signers, all
conditions precedent to be performed by the Company, if any, provided
for in this Indenture relating to the proposed action have been
complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent to be performed by the Company,
if any, provided for in this Indenture relating to the proposed action
have been complied with.
Section 13.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture, other than the Officers' Certificate
required by Section 4.06, shall include:
(1) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he has made
such examination or investigation as is reasonably necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of each
such Person, such condition or covenant has been complied with.
Section 13.06. Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules in accordance with the Trustee's
customary practices for action by or at a meeting of Holders. The Paying Agent
or Registrar may make reasonable rules for its functions.
Section 13.07. Legal Holidays.
A "Legal Holiday" used with respect to a particular place of payment is a
Saturday, a Sunday or a day on which banking institutions in New York, New York
or at such place of payment are not required to be open. If a payment date is a
Legal Holiday at such place, payment may be made at such place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue for the
intervening period.
Section 13.08. Governing Law.
This Indenture, the Notes and the Guarantees shall be governed by, and
construed in accordance with, the laws of the State of New York but without
giving effect to applicable principles of conflicts of law to the extent that
the application of the law of another jurisdiction would be required thereby.
Each of the parties hereto agree to submit to the jurisdiction of the courts of
the State of New York in any action or proceeding arising out of or relating to
this Indenture.
Section 13.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or any of its Subsidiaries. Any such indenture, loan
or debt agreement may not be used to interpret this Indenture.
Section 13.10. No Personal Liability.
No director, officer, employee or stockholder, as such, of the Company or
any Subsidiary Guarantor, as such, shall have any liability for any obligations
of the Company or any Subsidiary Guarantor under the Notes, the Guarantees, this
Indenture or the Registration Rights Agreement or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder of
Notes by accepting a Note waives and releases all such liability. The waiver
and release are part of the consideration for the issuance of the Notes.
Section 13.11. Successors.
All agreements of the Company in this Indenture and the Notes shall bind
its successors. All agreements of the Trustee in this Indenture shall bind its
successors.
Section 13.12. Duplicate Originals.
All parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together shall represent the same
agreement.
Section 13.13. Severability.
In case any one or more of the provisions in this Indenture or in the Notes
shall be held invalid, illegal or unenforceable, in any respect for any reason,
the validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions shall not in any way be affected or
impaired thereby, it being intended that all of the provisions hereof shall be
enforceable to the full extent permitted by law.
Section 13.14. Independence of Covenants.
All covenants and agreements in this Indenture and the Notes shall be given
independent effect so that if any particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or otherwise be within the limitations of, another covenant shall
not avoid the occurrence of a Default or an Event of Default if such action is
taken or condition exists.
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the date first written above.
SITEL CORPORATION
By: ________________________________
Philip A. Clough
President
SITEL International, Inc., as
Subsidiary Guarantor
By: ________________________________
Philip A. Clough
Vice President
SITEL Insurance Services, Inc., as
Subsidiary Guarantor
By: ________________________________
Philip A. Clough
Vice President
Financial Insurance Services, Inc., as
Subsidiary Guarantor
By: ________________________________
Philip A. Clough
Vice President
SITEL Support Services, Inc., as
Subsidiary Guarantor
By: ________________________________
Philip A. Clough
Vice President
SITEL Investments, Inc., as
Subsidiary Guarantor
By: ________________________________
Philip A. Clough
Vice President
SITEL Software, Inc., as
Subsidiary Guarantor
By: ________________________________
Philip A. Clough
Vice President
National Action Financial Services, Inc., as
Subsidiary Guarantor
By: ________________________________
Philip A. Clough
Vice President
SITEL Technical Services, Inc., as
Subsidiary Guarantor
By: ________________________________
Philip A. Clough
Vice President
SITEL Insurance Marketing Services, Inc., as
Subsidiary Guarantor
By: ________________________________
Philip A. Clough
Vice President
The First National Bank of Maryland,
as Trustee
By: ________________________________
Robert D. Brown
Assistant Vice President
<PAGE>
EXHIBIT A
CUSIP No.:
SITEL CORPORATION
9 1/4% SENIOR SUBORDINATED NOTE DUE 2006, SERIES A
No. $
SITEL CORPORATION, a Minnesota corporation (the "Company"), for value
received, promises to pay to or registered assigns the
principal sum of
Dollars on March 15, 2006.
Interest Payment Dates: March 15 and September 15, commencing September 15,
1998
Record Dates: March 1 and September 1
Reference is made to the further provisions of this Note contained herein,
which will for all purposes have the same effect as if set forth at this place.
IN WITNESS WHEREOF, the Company has caused this Note to be signed manually
or by facsimile by its duly authorized officers.
SITEL CORPORATION
By: ________________________________
Name:
Title:
By: ________________________________
Name:
Title:
Dated:
Certificate of Authentication
This is one of the 9 1/4% Senior Subordinated Notes, Series A due 2006
referred to in the within-mentioned Indenture.
The First National Bank of Maryland, as
Trustee
By:________________________
Authorized Signatory
Date of Authentication:
<PAGE>
(REVERSE OF SECURITY)
9 1/4% Senior Subordinated Note due 2006, Series A
1. Interest. SITEL CORPORATION, a Minnesota corporation (the "Company"),
promises to pay interest on the principal amount of this Note at the rate per
annum shown above. Interest on the Notes will accrue from the most recent date
on which interest has been paid or, if no interest has been paid, from March 10,
1998. The Company will pay interest semi-annually in arrears on each Interest
Payment Date, commencing September 15, 1998. Interest will be computed on the
basis of a 360-day year of twelve 30-day months and, in the case of a partial
month, the actual number of days elapsed.
The Company shall pay interest on overdue principal and on overdue
installments of interest from time to time on demand at the rate borne by the
Notes and on overdue installments of interest (without regard to any applicable
grace periods) to the extent lawful.
2. Method of Payment. The Company shall pay interest on the Notes (except
defaulted interest) to the Persons who are the registered Holders at the close
of business on the Record Date immediately preceding the Interest Payment Date
even if the Notes are canceled on registration of transfer or registration of
exchange (including pursuant to an Exchange Offer (as defined in the
Registration Rights Agreement)) after such Record Date. Holders must surrender
Notes to a Paying Agent to collect principal payments. The Company shall pay
principal and interest in money of the United States that at the time of payment
is legal tender for payment of public and private debts ("U.S. Legal Tender").
However, the Company may pay principal and interest by its check payable in such
U.S. Legal Tender. The Company may deliver any such interest payment to the
Paying Agent or to a Holder at the Holder's registered address.
3. Paying Agent and Registrar. Initially, The First National Bank of
Maryland (the "Trustee"), will act as Paying Agent and Registrar. The Company
may change any Paying Agent, Registrar or co-Registrar without notice to the
Holders.
4. Indenture. The Company issued the Notes under an Indenture, dated as of
March 10, 1998 (the "Indenture"), among the Company, each of the Subsidiary
Guarantors named therein and the Trustee. Capitalized terms herein are used as
defined in the Indenture unless otherwise defined herein. This Note is one of a
duly authorized issue of Initial Notes of the Company designated as its 9 1/4%
Senior Subordinated Notes due 2006, Series A (the "Initial Notes"), limited
(except as otherwise provided in the Indenture) in aggregate principal amount to
$200,000,000 which may be issued under the Indenture. The Notes include the
Initial Notes, the Private Exchange Notes and the Exchange Notes (as defined in
the Indenture) issued in exchange for the Initial Notes pursuant to the
Registration Rights Agreement. The Initial Notes, the Private Exchange Notes
and the Exchange Notes are treated as a single class of securities under the
Indenture. The terms of the Notes include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of 1939
(15 U.S. Code 77aaa-77bbbb) (the "TIA""), as in effect on the date of the
Indenture. Notwithstanding anything to the contrary herein, the Notes are
subject to all such terms, and Holders of Notes are referred to the Indenture
and the TIA for a statement of them. The Notes are general unsecured
obligations of the Company. Payment on each Note is guaranteed on a senior
subordinated basis by the Subsidiary Guarantors pursuant to Article Twelve of
the Indenture. Each Holder, by accepting a Note, agrees to be bound by all of
the terms and provisions of the Indenture, as the same may be amended from time
to time in accordance with its terms.
5. Subordination. The Notes are subordinated in right of payment, in the
manner and to the extent set forth in the Indenture, to the prior payment in
full in cash or Cash Equivalents of all Obligations on the Senior Debt of the
Company, whether outstanding on the Issue Date or thereafter created, incurred,
assumed or guaranteed. Each Holder by his acceptance hereof agrees to be bound
by such provisions and authorizes and expressly directs the Trustee, on his
behalf, to take such action as may be necessary or appropriate to effectuate the
subordination provided for in the Indenture and appoints the Trustee his
attorney-in-fact for such purposes.
6. Redemption. The Notes will be redeemable, at the Company's option, in
whole at any time or in part from time to time, on and after March 15, 2002,
upon not less than 30 nor more than 60 days' notice, at the following redemption
prices (expressed as percentages of the principal amount thereof) if redeemed
during the twelve-month period commencing on March 15 of the year set forth
below, plus, in each case, accrued and unpaid interest thereon, if any, to the
date of redemption:
Year Percentage
____ __________
2002 104.625%
2003 103.083%
2004 101.542%
2005 and thereafter 100.000%
At any time, or from time to time, on or prior to March 15, 2001, the
Company may, at its option, use the net cash proceeds of one or more Public
Equity Offerings to redeem up to 35% of the aggregate principal amount of Notes
originally issued at a redemption price equal to 109.250% of the principal
amount thereof plus accrued and unpaid interest thereon, if any, to the date of
redemption; provided that at least 65% of the principal amount of Notes
originally issued remains outstanding immediately after any such redemption. In
order to effect the foregoing redemption with the proceeds of any Public Equity
Offering, the Company shall make such redemption not more than 90 days after the
receipt of proceeds of any such Public Equity Offering.
7. Notice of Redemption. Notice of redemption will be mailed at least 30
days but not more than 60 days before the Redemption Date to each Holder of
Notes to be redeemed at such Holder's registered address. Notes in
denominations larger than $1,000 may be redeemed in part.
Except as set forth in the Indenture, if monies for the redemption of the
Notes called for redemption shall have been deposited with the Paying Agent for
redemption on such Redemption Date, then, unless the Company defaults in the
payment of such redemption price plus accrued interest, if any, the Notes called
for redemption will cease to bear interest from and after such Redemption Date
and the only right of the Holders of such Notes will be to receive payment of
the redemption price plus accrued interest, if any.
8. Offers to Purchase. Sections 4.14 and 4.15 of the Indenture provide
that, after certain Asset Sales and upon the occurrence of a Change of Control,
and subject to further limitations contained therein, the Company will make an
offer to purchase certain amounts of the Notes in accordance with the procedures
set forth in the Indenture.
9. Registration Rights. Pursuant to a Registration Rights Agreement among
the Company, the Subsidiary Guarantors and the Initial Purchasers, the Company
and the Subsidiary Guarantors will be obligated to consummate an exchange offer
pursuant to which the Holder of this Note shall have the right to exchange this
Note for Exchange Notes, which have been registered under the Securities Act, in
like principal amount and having terms identical in all material respects as the
Initial Notes. The Holders of the Initial Notes shall be entitled to receive
certain additional interest payments in the event such exchange offer is not
consummated and upon certain other conditions, all pursuant to and in accordance
with the terms of the Registration Rights Agreement.
10. Denominations; Transfer; Exchange. The Notes are in registered form,
without coupons, and in denominations of $1,000 and integral multiples of
$1,000. A Holder shall register the transfer of or exchange Notes in accordance
with the Indenture. The Registrar may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents and to pay certain
transfer taxes or similar governmental charges payable in connection therewith
as permitted by the Indenture. The Registrar need not register the transfer of
or exchange of any Notes or portions thereof selected for redemption.
11. Persons Deemed Owners. The registered Holder of a Note shall be
treated as the owner of it for all purposes.
12. Unclaimed Money. If money for the payment of principal or interest
remains unclaimed for one year, the Trustee and the Paying Agent will pay the
money back to the Company. After that, all liability of the Trustee and such
Paying Agent with respect to such money shall cease.
13. Discharge Prior to Redemption or Maturity. If the Company at any
time deposits with the Trustee U.S. Legal Tender or U.S. Government Obligations
sufficient to pay the principal of and interest on the Notes to redemption or
maturity and complies with the other provisions of the Indenture relating
thereto, the Company will be discharged from certain provisions of the Indenture
and the Notes (including certain covenants, and including, under certain
circumstances, its obligation to pay the principal of and interest on the Notes
but without affecting the rights of the Holders to receive such amounts from
such deposits).
14. Amendment; Supplement; Waiver. Subject to certain exceptions set
forth in the Indenture, the Indenture or the Notes may be amended or
supplemented with the written consent of the Holders of a majority in aggregate
principal amount of the Notes then outstanding, and any past Default or Event of
Default or noncompliance with any provision may be waived with the written
consent of the Holders of a majority in aggregate principal amount of the Notes
then outstanding. Without notice to or consent of any Holder, the parties
thereto may amend or supplement the Indenture or the Notes to, among other
things, cure any ambiguity, defect or inconsistency, provide for uncertificated
Notes in addition to or in place of certificated Notes, comply with any
requirements of the Commission in order to effect or maintain the qualification
of the Indenture under the TIA or comply with Article Five of the Indenture or
make any other change that does not adversely affect in any material respect the
rights of any Holder of a Note.
15. Restrictive Covenants. The Indenture imposes certain limitations on
the ability of the Company and its Restricted Subsidiaries to, among other
things, incur additional Indebtedness, pay dividends or make certain other
Restricted Payments, make certain Investments, consummate certain Asset Sales,
enter into transactions with Affiliates, incur liens, create dividend or other
payment restrictions affecting Restricted Subsidiaries, issue Preferred Stock of
its Restricted Subsidiaries, merge or consolidate with any other Person or sell,
assign, transfer, lease, convey or otherwise dispose of all or substantially all
of the assets of the Company and its Restricted Subsidiaries or adopt a plan of
liquidation. Such limitations are subject to a number of important
qualifications and exceptions. The Company must annually report to the Trustee
on compliance with such limitations.
16. Successors. When a successor assumes, in accordance with the
Indenture, all the obligations of its predecessor under the Notes and the
Indenture, the predecessor, subject to certain exceptions, will be released from
those obligations.
17. Defaults and Remedies. If an Event of Default occurs and is
continuing, the Trustee or the Holders of not less than 25% in aggregate
principal amount of Notes then outstanding may declare all the Notes to be due
and payable in the manner, at the time and with the effect provided in the
Indenture. Holders of Notes may not enforce the Indenture or the Notes except
as provided in the Indenture. The Trustee is not obligated to enforce the
Indenture or the Notes unless it has received indemnity reasonably satisfactory
to it. The Indenture permits, subject to certain limitations therein provided,
Holders of a majority in aggregate principal amount of the Notes then
outstanding to direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders of Notes notice of any continuing Default or
Event of Default (except a Default in payment of principal or interest when due
or a Default in compliance with Article Five of the Indenture) if it determines
that withholding notice is in their interest.
18. Trustee Dealings with the Company and Its Subsidiaries. The Trustee
under the Indenture, in its individual or any other capacity, may become the
owner or pledgee of Notes and may otherwise deal with the Company, its
Subsidiaries or their respective Affiliates as if it were not the Trustee.
19. No Recourse Against Others. No director, officer, employee or
shareholder, as such, of the Company or any Subsidiary Guarantor, as such, shall
have any liability for any obligation of the Company or any Subsidiary Guarantor
under the Notes, the Indenture, the Guarantees or the Registration Rights
Agreement or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
20. Guarantees. This Note will be entitled to the benefits of certain
Guarantees made for the benefit of the Holders. Reference is hereby made to the
Indenture for a statement of the respective rights, limitations of rights,
duties and obligations thereunder of the Subsidiary Guarantors, the Trustee and
the Holders.
21. Authentication. This Note shall not be valid until the Trustee or
Authenticating Agent manually signs the certificate of authentication on this
Note.
22. Governing Law. This Note and the Indenture shall be governed by and
construed in accordance with the laws of the State of New York, as applied to
contracts made and performed within the State of New York, without regard to
principles of conflict of laws. Each of the parties hereto agrees to submit to
the jurisdiction of the courts of the State of New York in any action or
proceeding arising out of or relating to this Note.
23. Abbreviations and Defined Terms. Customary abbreviations may be used
in the name of a Holder of a Note or an assignee, such as: TEN COM (= tenants in
common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with
right of survivorship and not as tenants in common), CUST (= Custodian), and
U/G/M/A (= Uniform Gifts to Minors Act).
24. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes as a convenience to the Holders of the
Notes. No representation is made as to the accuracy of such numbers as printed
on the Notes and reliance may be placed only on the other identification numbers
printed hereon.
The Company will furnish to any Holder of a Note upon written request and
without charge a copy of the Indenture, which has the text of this Note.
Requests may be made to: SITEL Corporation, 300 E. Lombard Street, Suite 850,
Baltimore, MD 21202.
ASSIGNMENT FORM
If you the Holder want to assign this Note, fill in the form below and have
your signature guaranteed:
I or we assign and transfer this Note to:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code and social security or tax ID number
of assignee)
and irrevocably appoint ____________________________, agent to transfer this
Note on the books of the Company. The agent may substitute another to act for
him.
Dated: ____________ Signed: ___________________________________________________
(Sign exactly as your name appears on the other side
of this Note)
Signature Guarantee:
In connection with any transfer of this Note occurring prior to the date
which is the earlier of (i) the date of the declaration by the Commission of the
effectiveness of a registration statement under the Securities Act of 1933, as
amended (the "Securities Act") covering resales of this Note (which
effectiveness shall not have been suspended or terminated at the date of the
transfer) and (ii) March 10, 2000, the undersigned confirms that it has not
utilized any general solicitation or general advertising in connection with the
transfer:
[Check One]
(1) ___ to the Company or a subsidiary thereof; or
(2) ___ pursuant to and in compliance with Rule 144A under the Securities
Act of 1933, as amended; or
(3) ___ to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as
amended) that has furnished to the Trustee a signed letter containing
certain representations and agreements (the form of which letter can
be obtained from the Trustee); or
(4) ___ outside the United States to a "foreign person" in compliance
with Rule 904 of Regulation S under the Securities Act of 1933, as
amended; or
(5) ___ pursuant to the exemption from registration provided by Rule 144
under the Securities Act of 1933, as amended; or
(6) ___ pursuant to an effective registration statement under the
Securities Act of 1933, as amended; or
(7) ___ pursuant to another available exemption from the registration
requirements of the Securities Act of 1933, as amended.
and unless the box below is checked, the undersigned confirms that such Note is
not being transferred to an "affiliate" of the Company as defined in Rule 144
under the Securities Act of 1933, as amended (an "Affiliate"):
[ ] The transferee is an Affiliate of the Company.
Unless one of the items is checked, the Trustee will refuse to register any
of the Notes evidenced by this certificate in the name of any person other than
the registered Holder thereof; provided, however, that if item (3), (4), (5) or
(7) is checked, the Company or the Trustee may require, prior to registering any
such transfer of the Notes, in their sole discretion, such written legal
opinions, certifications (including an investment letter in the case of box (3)
or (4)) and other information as the Trustee or the Company has reasonably
requested to confirm that such transfer is being made pursuant to an exemption
from, or in a transaction not subject to, the registration requirements of the
Securities Act of 1933, as amended.
If none of the foregoing items are checked, the Trustee or Registrar shall
not be obligated to register this Note in the name of any person other than the
Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 2.17 of the Indenture shall have
been satisfied.
Dated: ____________ Signed:____________________________________________________
(Sign exactly as your name appears on the other side
of this Note)
Signature Guarantee: ___________________________________________________________
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this Note for
its own account or an account with respect to which it exercises sole investment
discretion and that it and any such account is a "qualified institutional buyer"
within the meaning of Rule 144A under the Securities Act of 1933, as amended and
is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated: ______________ _______________________________________________________
NOTICE: to be executed by an executive officer
[OPTION OF HOLDER TO ELECT PURCHASE]
If you want to elect to have this Note purchased by the Company pursuant to
Section 4.14 or Section 4.15 of the Indenture, check the appropriate box:
Section 4.14 [____]
Section 4.15 [____]
If you want to elect to have only part of this Note purchased by the
Company pursuant to Section 4.14 or Section 4.15 of the Indenture, state the
amount you elect to have purchased:
$______________________
Dated:__________________ ____________________________________________________
NOTICE: The signature on this assignment must
correspond with the name as it appears upon the
face of the within Note in every particular without
alteration or enlargement or any change whatsoever
and be guaranteed.
Signature Guarantee:___________________________________________________________
<PAGE>
EXHIBIT B
CUSIP NO.:
SITEL CORPORATION
9 1/4% SENIOR SUBORDINATED NOTE DUE 2006, SERIES B
No. $
SITEL CORPORATION, a Minnesota corporation (the "Company"), for value
received, promises to pay to or registered assigns
the principal sum of
Dollars on March 15, 2006.
Interest Payment Dates: March 15 and September 15, commencing September 15,
1998
Record Dates: March 1 and September 1
Reference is made to the further provisions of this Note contained herein,
which will for all purposes have the same effect as if set forth at this place.
IN WITNESS WHEREOF, the Company has caused this Note to be signed manually
or by facsimile by its duly authorized officers.
SITEL CORPORATION
By: ________________________________
Name:
Title:
By: ________________________________
Name:
Title:
Dated:
Certificate of Authentication
This is one of the 9 1/4% Senior Subordinated Notes, Series B due 2006
referred to in the within-mentioned Indenture.
The First National Bank of Maryland,
as Trustee
By: ________________________________
Name:
Title: Authorized Signatory
Date of Authentication:
<PAGE>
(REVERSE OF SECURITY)
9 1/4% Senior Subordinated Note due 2006, Series B
1. Interest. SITEL CORPORATION, a Minnesota corporation (the "Company"),
promises to pay interest on the principal amount of this Note at the rate per
annum shown above. Interest on the Notes will accrue from the most recent date
on which interest has been paid or, if no interest has been paid, from March 10,
1998. The Company will pay interest semi-annually in arrears on each Interest
Payment Date, commencing September 15, 1998. Interest will be computed on the
basis of a 360-day year of twelve 30-day months and, in the case of a partial
month, the actual number of days elapsed.
The Company shall pay interest on overdue principal and on overdue
installments of interest from time to time on demand at the rate borne by the
Notes and on overdue installments of interest (without regard to any applicable
grace periods) to the extent lawful.
2. Method of Payment. The Company shall pay interest on the Notes (except
defaulted interest) to the Persons who are the registered Holders at the close
of business on the Record Date immediately preceding the Interest Payment Date
even if the Notes are canceled on registration of transfer or registration of
exchange after such Record Date. Holders must surrender Notes to a Paying Agent
to collect principal payments. The Company shall pay principal and interest in
money of the United States that at the time of payment is legal tender for
payment of public and private debts ("U.S. Legal Tender"). However, the Company
may pay principal and interest by its check payable in such U.S. Legal Tender.
The Company may deliver any such interest payment to the Paying Agent or to a
Holder at the Holder's registered address.
3. Paying Agent and Registrar. Initially, The First National Bank of
Maryland (the "Trustee"), will act as Paying Agent and Registrar. The Company
may change any Paying Agent, Registrar or co-Registrar without notice to the
Holders.
4. Indenture. The Company issued the Notes under an Indenture, dated as of
March 10, 1998 (the "Indenture"), among the Company, each of the Subsidiary
Guarantors named therein and the Trustee. Capitalized terms herein are used as
defined in the Indenture unless otherwise defined herein. This Note is one of a
duly authorized issue of Initial Notes of the Company designated as its 9 1/4%
Senior Subordinated Notes due 2006, Series B (the "Exchange Notes"), limited
(except as otherwise provided in the Indenture) in aggregate principal amount to
$200,000,000 which may be issued under the Indenture. (the "Exchange Notes").
The Notes include the 9 1/4% Senior Subordinated Notes due 2006, Series A (the
"Initial Notes"), the Private Exchange Notes and the Exchange Notes, issued in
exchange for the Initial Notes pursuant to the Registration Rights Agreement.
The Initial Notes, the Private Exchange Notes and the Exchange Notes are treated
as a single class of securities under the Indenture. Capitalized terms herein
are used as defined in the Indenture unless otherwise defined herein. The terms
of the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939 (15 U.S. Code 77aaa-
77bbbb) (the "TIA"), as in effect on the date of the Indenture. Notwithstanding
anything to the contrary herein, the Notes are subject to all such terms, and
Holders of Notes are referred to the Indenture and the TIA for a statement of
them. The Notes are general unsecured obligations of the Company. Payment on
each Note is guaranteed on a senior subordinated basis by the Subsidiary
Guarantors pursuant to Article Twelve of the Indenture. Each Holder, by
accepting a Note, agrees to be bound by all of the terms and provisions of the
Indenture, as the same may be amended from time to time in accordance with its
terms.
5. Subordination. The Notes are subordinated in right of payment, in the
manner and to the extent set forth in the Indenture, to the prior payment in
full in cash or Cash Equivalents of all Obligations on the Senior Debt of the
Company, whether outstanding on the Issue Date or thereafter created, incurred,
assumed or guaranteed. Each Holder by his acceptance hereof agrees to be bound
by such provisions and authorizes and expressly directs the Trustee, on his
behalf, to take such action as may be necessary or appropriate to effectuate the
subordination provided for in the Indenture and appoints the Trustee his
attorney-in-fact for such purposes.
6. Redemption. The Notes will be redeemable, at the Company's option, in
whole at any time or in part from time to time, on and after March 15, 2002,
upon not less than 30 nor more than 60 days' notice, at the following redemption
prices (expressed as percentages of the principal amount thereof) if redeemed
during the twelve-month period commencing on March 15 of the years set forth
below, plus, in each case, accrued and unpaid interest, if any, thereon to the
date of redemption:
Year Percentage
____ __________
2002 104.625%
2003 103.083%
2004 101.542%
2005 and thereafter 100.000%
At any time, or from time to time, on or prior to March 15, 2001, the
Company may, at its option, use the net cash proceeds of one or more Public
Equity Offerings to redeem up to 35% of the aggregate principal amount of Notes
originally issued at a redemption price equal to 109.250% of the principal
amount thereof plus accrued and unpaid interest thereon, if any, to the date of
redemption; provided that at least 65% of the principal amount of Notes
originally issued remains outstanding immediately after any such redemption. In
order to effect the foregoing redemption with the proceeds of any Public Equity
Offering, the Company shall make such redemption not more than 90 days after the
receipt of proceeds of any such Public Equity Offering.
7. Notice of Redemption. Notice of redemption will be mailed at least 30
days but not more than 60 days before the Redemption Date to each Holder of
Notes to be redeemed at such Holder's registered address. Notes in
denominations larger than $1,000 may be redeemed in part.
Except as set forth in the Indenture, if monies for the redemption of the
Notes called for redemption shall have been deposited with the Paying Agent for
redemption on such Redemption Date, then, unless the Company defaults in the
payment of such redemption price plus accrued interest, if any, the Notes called
for redemption will cease to bear interest from and after such Redemption Date
and the only right of the Holders of such Notes will be to receive payment of
the redemption price plus accrued interest, if any.
8. Offers to Purchase. Sections 4.14 and 4.15 of the Indenture provide
that, after certain Asset Sales and upon the occurrence of a Change of Control,
and subject to further limitations contained therein, the Company will make an
offer to purchase certain amounts of the Notes in accordance with the procedures
set forth in the Indenture.
9. Denominations; Transfer; Exchange. The Notes are in registered form,
without coupons, and in denominations of $1,000 and integral multiples of
$1,000. A Holder shall register the transfer of or exchange Notes in accordance
with the Indenture. The Registrar may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents and to pay certain
transfer taxes or similar governmental charges payable in connection therewith
as permitted by the Indenture. The Registrar need not register the transfer of
or exchange of any Notes or portions thereof selected for redemption.
10. Persons Deemed Owners. The registered Holder of a Note shall be
treated as the owner of it for all purposes.
11. Unclaimed Money. If money for the payment of principal or interest
remains unclaimed for one year, the Trustee and the Paying Agent will pay the
money back to the Company. After that, all liability of the Trustee and such
Paying Agent with respect to such money shall cease.
12. Discharge Prior to Redemption or Maturity. If the Company at any
time deposits with the Trustee U.S. Legal Tender or U.S. Government Obligations
sufficient to pay the principal of and interest on the Notes to redemption and
complies with the other provisions of the Indenture relating thereto, the
Company will be discharged from certain provisions of the Indenture and the
Notes (including certain covenants, and including, under certain circumstances,
its obligation to pay the principal of and interest on the Notes but without
affecting the rights of the Holders to receive such amounts from such deposit).
13. Amendment; Supplement; Waiver. Subject to certain exceptions set
forth in the Indenture, the Indenture or the Notes may be amended or
supplemented with the written consent of the Holders of a majority in aggregate
principal amount of the Notes then outstanding, and any past Default or Event of
Default or noncompliance with any provision may be waived with the written
consent of the Holders of a majority in aggregate principal amount of the Notes
then outstanding. Without notice to or consent of any Holder, the parties
thereto may amend or supplement the Indenture or the Notes to, among other
things, cure any ambiguity, defect or inconsistency, provide for uncertificated
Notes in addition to or in place of certificated Notes, comply with any
requirements of the Commission in order to effect or maintain the qualification
of the Indenture under the TIA or comply with Article Five of the Indenture or
make any other change that does not adversely affect in any material respect the
rights of any Holder of a Note.
14. Restrictive Covenants. The Indenture imposes certain limitations on
the ability of the Company and its Restricted Subsidiaries to, among other
things, incur additional Indebtedness, pay dividends or make certain other
Restricted Payments, make certain Investments, consummate certain Asset Sales,
enter into transactions with Affiliates, incur liens, create dividend or other
payment restrictions affecting Restricted Subsidiaries, issue Preferred Stock of
its Restricted Subsidiaries, merge or consolidate with any other Person or sell,
assign, transfer, lease, convey or otherwise dispose of all or substantially all
of the assets of the Company and its Restricted Subsidiaries or adopt a plan of
liquidation. Such limitations are subject to a number of important
qualifications and exceptions. The Company must annually report to the Trustee
on compliance with such limitations.
15. Successors. When a successor assumes, in accordance with the
Indenture, all the obligations of its predecessor under the Notes and the
Indenture, the predecessor, subject to certain exceptions, will be released from
those obligations.
16. Defaults and Remedies. If an Event of Default occurs and is
continuing, the Trustee or the Holders of not less than 25% in aggregate
principal amount of Notes then outstanding may declare all the Notes to be due
and payable in the manner, at the time and with the effect provided in the
Indenture. Holders of Notes may not enforce the Indenture or the Notes except
as provided in the Indenture. The Trustee is not obligated to enforce the
Indenture or the Notes unless it has received indemnity reasonably satisfactory
to it. The Indenture permits, subject to certain limitations therein provided,
Holders of a majority in aggregate principal amount of the Notes then
outstanding to direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders of Notes notice of any continuing Default or
Event of Default (except a Default in payment of principal or interest when due
or a Default in compliance with Article Five of the Indenture) if it determines
that withholding notice is in their interest.
17. Trustee Dealings with the Company and Its Subsidiaries. The Trustee
under the Indenture, in its individual or any other capacity, may become the
owner or pledgee of Notes and may otherwise deal with the Company, its
Subsidiaries or their respective Affiliates as if it were not the Trustee.
18. No Recourse Against Others. No director, officer, employee or
shareholder, as such, of the Company or any Subsidiary Guarantor, as such, shall
have any liability for any obligation of the Company or any Subsidiary Guarantor
under the Notes, the Indenture, the Guarantees or the Registration Rights
Agreement or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
19. Guarantees. This Note will be entitled to the benefits of certain
Guarantees, if any, made for the benefit of the Holders. Reference is hereby
made to the Indenture for a statement of the respective rights, limitations of
rights, duties and obligations thereunder of the Subsidiary Guarantors, the
Trustee and the Holders.
20. Authentication. This Note shall not be valid until the Trustee or
Authenticating Agent manually signs the certificate of authentication on this
Note.
21. Governing Law. This Note and the Indenture shall be governed by and
construed in accordance with the laws of the State of New York, as applied to
contracts made and performed within the State of New York, without regard to
principles of conflict of laws. Each of the parties hereto agrees to submit to
the jurisdiction of the courts of the State of New York in any action or
proceeding arising out of or relating to this Note.
22. Abbreviations and Defined Terms. Customary abbreviations may be used
in the name of a Holder of a Note or an assignee, such as: TEN COM (= tenants in
common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with
right of survivorship and not as tenants in common), CUST (= Custodian), and
U/G/M/A (= Uniform Gifts to Minors Act).
23. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes as a convenience to the Holders of the
Notes. No representation is made as to the accuracy of such numbers as printed
on the Notes and reliance may be placed only on the other identification numbers
printed hereon.
The Company will furnish to any Holder of a Note upon written request and
without charge a copy of the Indenture, which has the text of this Note.
Requests may be made to: SITEL Corporation, 300 E. Lombard Street, Suite 850,
Baltimore, MD 21202.
ASSIGNMENT FORM
If you the Holder want to assign this Note, fill in the form below and have
your signature guaranteed:
If you the Holder want to assign this Note, fill in the form below and have
your signature guaranteed:
I or we assign and transfer this Note to:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code and social security or tax ID number
of assignee)
and irrevocably appoint ____________________________, agent to transfer this
Note on the books of the Company. The agent may substitute another to act for
him.
Dated: ____________ Signed:____________________________________________________
(Sign exactly as your name appears on the other side
of this Note)
Signature Guarantee:
<PAGE>
[OPTION OF HOLDER TO ELECT PURCHASE]
If you want to elect to have this Note purchased by the Company pursuant to
Section 4.14 or Section 4.15 of the Indenture, check the appropriate box:
Section 4.14 [____]
Section 4.15 [____]
If you want to elect to have only part of this Note purchased by the
Company pursuant to Section 4.14 or Section 4.15 of the Indenture, state the
amount you elect to have purchased:
$______________________
Dated:__________________ ______________________________________________________
NOTICE: The signature on this assignment must
correspond with the name as it appears upon the
face of the within Note in every particular without
alteration or enlargement or any change whatsoever
and be guaranteed.
Signature Guarantee:____________________________________________________________
<PAGE>
EXHIBIT C
Form of Certificate To Be
Delivered in Connection with
Transfers to Non-QIB Accredited Investors
_________________________________________
__________, ____
The First National Bank of Maryland
25 South Charles Street, 16th Floor
Baltimore, Maryland 21201
Ladies and Gentlemen:
In connection with our proposed purchase of 9 1/4% Senior Subordinated
Notes due 2006 (the "Notes") of SITEL Corporation, a Minnesota corporation (the
"Company"), we confirm that:
1. We have received a copy of the Offering Memorandum (the "Offering
Memorandum"), dated March 5, 1998, relating to the Notes and such other
information as we deem necessary in order to make our investment decision. We
acknowledge that we have read and agreed to the matters stated in the section
entitled "Transfer Restrictions" of such Offering Memorandum.
2. We understand that any subsequent transfer of the Notes is subject to
certain restrictions and conditions set forth in the Indenture relating to the
Notes (the "Indenture") as described in the Offering Memorandum and the
undersigned agrees to be bound by, and not to resell, pledge or otherwise
transfer the Notes except in compliance with, such restrictions and conditions
and the Securities Act of 1933, as amended (the "Securities Act"), and all
applicable State securities laws.
3. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes may not be offered or
sold within the United States or to, or for the account or benefit of, U.S.
persons except as permitted in the following sentence. We agree, on our own
behalf and on behalf of any accounts for which we are acting as hereinafter
stated, that if we should sell any Notes, we will do so only (i) to the Company
or any subsidiary thereof, (ii) inside the United States in accordance with Rule
144A under the Securities Act to a "qualified institutional buyer" (as defined
in Rule 144A promulgated under the Securities Act), (iii) inside the United
States to an institutional "accredited investor" (as defined below) that, prior
to such transfer, furnishes (or has furnished on its behalf by a U.S. broker-
dealer) to the Trustee (as defined in the Indenture) a signed letter containing
certain representations and agreements relating to the restrictions on transfer
of the Notes (the form of which letter can be obtained from the Trustee), (iv)
outside the United States in accordance with Rule 904 of Regulation S
promulgated under the Securities Act to non-U.S. persons, (v) pursuant to the
exemption from registration provided by Rule 144 under the Securities Act (if
available), or (vi) pursuant to an effective registration statement under the
Securities Act, and we further agree to provide to any person purchasing any of
the Notes from us a notice advising such purchaser that resales of the Notes are
restricted as stated herein.
4. We understand that, on any proposed resale of any Notes, we will be
required to furnish to the Trustee and the Company such certification, legal
opinions and other information as the Trustee and the Company may reasonably
require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Notes purchased by us will bear a
legend to the foregoing effect.
5. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or their investment, as the case may be.
6. We are acquiring the Notes purchased by us for our account or for one or
more accounts (each of which is an institutional "accredited investor") as to
each of which we exercise sole investment discretion.
You, the Company, the Trustee and others are entitled to rely upon this
letter and are irrevocably authorized to produce this letter or a copy hereof to
any interested party in any administrative or legal proceeding or official
inquiry with respect to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By: ________________________________
Name:
Title:
<PAGE>
EXHIBIT D
Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
____________, ____
The First National Bank of Maryland
25 South Charles Street, 16th Floor
Baltimore, Maryland 21201
Re: SITEL Corporation (the "Company") _______
% Senior Subordinated Notes due 2006 (the
"Notes")
Ladies and Gentlemen:
In connection with our proposed sale of aggregate principal amount of the
Notes, we confirm that such sale has been effected pursuant to and in accordance
with Regulation S under the U.S. Securities Act of 1933, as amended (the
"Securities Act"), and, accordingly, we represent that:
(1) the offer of the Notes was not made to a person in the United States;
(2) either (a) at the time the buy offer was originated, the transferee
was outside the United States or we and any person acting on our behalf
reasonably believed that the transferee was outside the United States, or (b)
the transaction was executed in, on or through the facilities of a designated
off-shore securities market and neither we nor any person acting on our behalf
knows that the transaction has been pre-arranged with a buyer in the United
States;
(3) no directed selling efforts have been made in the United States in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer restrictions
applicable to the Notes.
You, the Company and counsel for the Company are entitled to rely upon this
letter and are irrevocably authorized to produce this letter or a copy hereof to
any interested party in any administrative or legal proceedings or official
inquiry with respect to the matters covered hereby. Terms used in this
certificate have the meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By: ______________________________
Authorized Signature
<PAGE>
EXHIBIT E
FORM OF GUARANTEE
For value received, the undersigned hereby unconditionally guarantees, as
principal obligor and not only as a surety, to the Holder of this Note the cash
payments in United States dollars of principal of, premium, if any, and interest
on this Note (and including Additional Interest payable thereon) in the amounts
and at the times when due and interest on the overdue principal, premium, if
any, and interest, if any, of this Note, if lawful, and the payment or
performance of all other obligations of the Company under the Indenture (as
defined below) or the Notes, to the Holder of this Note and the Trustee, all in
accordance with and subject to the terms and limitations of this Note, Article
Ten of the Indenture and this Guarantee. This Guarantee will become effective
in accordance with Article Ten of the Indenture and its terms shall be evidenced
therein. This Guarantee will be subordinated to Guarantor Senior Debt, as
defined in the Indenture, and in accordance with Article Twelve thereof. The
validity and enforceability of any Guarantee shall not be affected by the fact
that it is not affixed to any particular Note. The validity and enforceability
of any Guarantee shall not be affected by the fact that it is not affixed to any
particular Note. Capitalized terms used but not defined herein shall have the
meanings ascribed to them in the Indenture dated as of March 10, 1998, among
SITEL Corporation, a Minnesota corporation, as Company (the "Company"), each of
the Subsidiary Guarantors named therein and The First National Bank of Maryland,
as Trustee (the "Trustee"), as amended or supplemented (the "Indenture").
The obligations of the undersigned to the Holders of Notes and to the
Trustee pursuant to this Guarantee and the Indenture are expressly set forth in
Article Ten of the Indenture and reference is hereby made to the Indenture for
the precise terms of the Guarantee and all of the other provisions of the
Indenture to which this Guarantee relates.
THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS
OF LAW. Each Subsidiary Guarantor hereby agrees to submit to the jurisdiction
of the courts of the State of New York in any action or proceeding arising out
of or relating to this Guarantee.
This Guarantee is subject to release upon the terms set forth in the
Indenture.
IN WITNESS WHEREOF, each Subsidiary Guarantor has caused its Guarantee to
be duly executed.
Date:
SITEL International, Inc., as
Subsidiary Guarantor
By: ________________________________
Name:
Title:
SITEL Insurance Services, Inc., as
Subsidiary Guarantor
By: ________________________________
Name:
Title:
Financial Insurance Services, Inc., as
Subsidiary Guarantor
By: ________________________________
Name:
Title:
SITEL Support Services, Inc., as
Subsidiary Guarantor
By: ________________________________
Name:
Title:
SITEL Investments, Inc., as
Subsidiary Guarantor
By: ________________________________
Name:
Title:
SITEL Software, Inc., as
Subsidiary Guarantor
By: ________________________________
Name:
Title:
National Action Financial Services, Inc., as
Subsidiary Guarantor
By: ________________________________
Name:
Title:
SITEL Technical Services, Inc., as
Subsidiary Guarantor
By: ________________________________
Name:
Title:
SITEL Insurance Marketing Services, Inc., as
Subsidiary Guarantor
By: ________________________________
Name:
Title:
