EXHIBIT 4.2
SENIOR BRIDGE LOAN AGREEMENT
among
ACTIVANT SOLUTIONS HOLDINGS INC.,
as Parent Guarantor,
ACTIVANT SOLUTIONS INC.,
as Borrower,
The Several Lenders from Time to Time Party Hereto,
DEUTSCHE BANK AG CAYMAN ISLANDS BRANCH,
as Administrative Agent,
and
DEUTSCHE BANK AG CAYMAN ISLANDS BRANCH and
JPMORGAN CHASE BANK, N.A.,
as Initial
Lenders,
and
DEUTSCHE BANK SECURITIES INC. and
J.P. MORGAN SECURITIES INC.,
as Joint Lead Arrangers and Joint Book Runners
Dated as of
September 13, 2005
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Table of Contents
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SECTION 1.
Definitions and Accounting
Terms..............................................................3
1.1.
Defined
Terms.................................................................................3
1.2.
Terms
Generally...............................................................................3
1.3.
Accounting Terms;
GAAP........................................................................3
1.4.
Resolution of Drafting
Ambiguities............................................................3
SECTION 2.
Amount and Terms of
Credit....................................................................3
2.1.
Commitment....................................................................................3
2.2.
Notice of
Borrowing...........................................................................3
2.3.
Disbursement of
Funds.........................................................................3
2.4.
Initial Maturity Date; Final Maturity Date; Evidence of
Debt..................................3
2.5. Pro
Rata
Borrowing............................................................................3
2.6.
Interest......................................................................................3
2.7.
Interest
Periods..............................................................................3
2.8.
Increased Costs, Illegality,
etc..............................................................3
2.9.
Compensation..................................................................................3
2.10. Change of
Lending
Office......................................................................3
2.11. Notice of
Certain
Costs.......................................................................3
SECTION 3.
Fees; Voluntary Reduction of Initial Loan Commitments; Mandatory
Termination of
Commitments.................................................................................3
3.1. Fees
3
3.2.
Voluntary Reduction of
Commitments............................................................3
3.3.
Mandatory Termination of
Commitments..........................................................3
SECTION 4.
Payments......................................................................................3
4.1.
Voluntary
Prepayments.........................................................................3
4.2.
Mandatory Prepayments and Commitment
Reductions...............................................3
4.3.
Method and Place of
Payment...................................................................3
4.4. Net
Payments; Tax
Gross-Up....................................................................3
4.5.
Computations of Interest and
Fees.............................................................3
4.6. Pro
Rata
Treatment............................................................................3
4.7. Use
of
Proceeds...............................................................................3
SECTION 5.
Conditions....................................................................................3
5.1.
Conditions Precedent to Borrowing of Initial
Loans............................................3
5.2.
Conditions Precedent to Borrowing of Term
Loans...............................................3
SECTION 6.
Representations and
Warranties................................................................3
6.1.
Existence, Qualification and Power; Compliance with
Laws......................................3
6.2.
Authorization; No
Contravention...............................................................3
6.3.
Governmental Authorization; Other
Consents....................................................3
6.4.
Binding
Effect................................................................................3
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6.5.
Financial Statements; No Closing Date
MAE.....................................................3
6.6.
Litigation....................................................................................3
6.7. No
Default....................................................................................3
6.8.
Ownership of Property;
Liens..................................................................3
6.9.
Environmental
Compliance......................................................................3
6.10.
Taxes.........................................................................................3
6.11. ERISA
Compliance..............................................................................3
6.12. Labor
Relations...............................................................................3
6.13.
Subsidiaries; Equity
Interests................................................................3
6.14. Margin
Regulations; Investment Company Act; Public Utility Holding Company
Act................3
6.15. Internal
Accounting
Controls..................................................................3
6.16.
Insurance.....................................................................................3
6.17. Licenses;
Intellectual Property,
Etc..........................................................3
6.18.
Solvency......................................................................................3
6.19.
Disclosure....................................................................................3
6.20. Exchange
and Registration
Rights..............................................................3
6.21.
Indebtedness..................................................................................3
SECTION 7.
Affirmative
Covenants.........................................................................3
7.1. Use
of
Proceeds...............................................................................3
7.2. Use
of Proceeds of the Permanent
Securities...................................................3
7.3.
Exchange
Notes................................................................................3
7.4.
Change of
Control.............................................................................3
7.5.
Financial
Statements..........................................................................3
7.6.
Certificates; Other
Information...............................................................3
7.7.
Notices.......................................................................................3
7.8.
Existence.....................................................................................3
7.9.
Payment of
Obligations........................................................................3
7.10.
Maintenance of
Properties.....................................................................3
7.11.
Insurance.....................................................................................3
7.12. Compliance
with
Laws..........................................................................3
7.13. Further
Assurances............................................................................3
7.14.
Books and
Records.............................................................................3
7.15. Compliance
with Environmental
Laws............................................................3
7.16.
Reports.......................................................................................3
7.17. Compliance
Certificate........................................................................3
SECTION 8.
Negative
Covenants............................................................................3
8.1.
Limitation on Asset
Sales.....................................................................3
8.2.
Limitation on Restricted
Payments.............................................................3
8.3.
Limitations on Incurrence of Indebtedness and Issuance of
Disqualified Stock..................3
8.4.
Liens.........................................................................................3
8.5.
Merger, Consolidation or Sale of
Assets.......................................................3
8.6.
Transactions with
Affiliates..................................................................3
8.7.
Dividend and Other Payment Restrictions Affecting
Subsidiaries................................3
8.8.
Amendments or Waivers of Certain
Documents....................................................3
8.9.
Limitation on Guarantees by
Subsidiaries......................................................3
8.10. Limitation
on Investment Company
Status.......................................................3
8.11. Limitation
on Asset
Swaps.....................................................................3
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SECTION 9.
Events of
Default.............................................................................3
SECTION 10.
The
Agents....................................................................................3
10.1.
Appointment...................................................................................3
10.2. Delegation
of
Duties..........................................................................3
10.3.
Exculpatory
Provisions........................................................................3
10.4. Reliance
by Administrative
Agent..............................................................3
10.5. Notice of
Default.............................................................................3
10.6.
Non-Reliance on Agents and Other
Lenders......................................................3
10.7.
Indemnification...............................................................................3
10.8. Agents in
Their Individual
Capacities.........................................................3
10.9. Successor
Administrative
Agent................................................................3
SECTION 11.
Miscellaneous.................................................................................3
11.1. Amendments
and
Waivers........................................................................3
11.2.
Notices.......................................................................................3
11.3. No Waiver;
Cumulative
Remedies................................................................3
11.4. Survival
of Representations and
Warranties....................................................3
11.5. Payment of
Expenses and
Taxes.................................................................3
11.6. Successors
and Assigns; Participations and
Assignments........................................3
11.7.
Replacements of Lenders Under Certain
Circumstances...........................................3
11.8.
Adjustments;
Set-off..........................................................................3
11.9.
Counterparts..................................................................................3
11.10. Severability and
Integration..................................................................3
11.11. Governing
Law.................................................................................3
11.12. Submission to
Jurisdiction;
Waivers...........................................................3
11.13.
Acknowledgments...............................................................................3
11.14. Waivers of Jury
Trial.........................................................................3
11.15.
Confidentiality...............................................................................3
11.16. Release of
Guarantor..........................................................................3
11.17. U.S.A. Patriot
Act............................................................................3
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SCHEDULES
Schedule 2.1(a)
Commitments of Lenders and Addresses for Notices
Schedule 6.13
Subsidiaries and Other Equity Investments
Schedule 7.18
Post-Closing Matters
Schedule 8.4
Existing Liens
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EXHIBITS
Exhibit A-1
Form of Initial Note
Exhibit A-2
Form of Term Note
Exhibit B
Form of Assignment and Acceptance
Exhibit C
Form of Confidentiality Agreement
Exhibit D
Form of Legal Opinion of Weil, Gotshal & Manges LLP
Exhibit E
Form of Guarantee Agreement
Exhibit F
Closing Date Certificate
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SENIOR BRIDGE LOAN AGREEMENT dated as of September 13, 2005,
among
ACTIVANT SOLUTIONS HOLDINGS INC., a
Delaware corporation, as parent guarantor
("Holdings"), ACTIVANT SOLUTIONS INC., a
Delaware corporation (the "Borrower"),
DEUTSCHE BANK AG CAYMAN ISLANDS BRANCH
("DBCI") and JPMORGAN CHASE BANK, N.A.
("JPMCB"), as initial lenders (the "Initial
Lenders"), the other Lenders (as
defined below), DEUTSCHE BANK SECURITIES
INC. ("DBSI") and J.P. MORGAN
SECURITIES INC. ("JPMSI"), as joint lead
arrangers (in such capacities, the
"Joint Lead Arrangers") and joint book
runners (in such capacities, the "Joint
Book Runners"), and DBCI, as administrative
agent (in such capacity, the
"Administrative Agent").
RECITALS:
Pursuant to the Agreement and Plan of Merger Agreement dated
August
15, 2005 (the "Acquisition Agreement"),
between Prophet 21, Inc. (the "Acquired
Business"), the Borrower, P21 Merger
Corporation and, for certain limited
purposes, Thoma Cressey Equity Partners,
Inc., the Borrower has agreed to
acquire all of the outstanding capital
stock of the Acquired Business (the
"Acquisition"). The Borrower is a direct
wholly owned subsidiary of Holdings.
The funding requirements for the
Acquisition (including related fees and
expenses) and the refinancing of
outstanding indebtedness of the Acquired
Business (the "Refinancing") will be
approximately $220.0 million and such
amount will be provided solely from the
Loans (as defined below) or the issuance
and sale of Permanent Securities (as
defined below), the Holdings Financing (as
defined below) and cash on hand at the
Borrower. The parties hereto hereby agree
as follows:
SECTION 1. Definitions and
Accounting Terms
As used herein, the following terms shall have the meanings
specified
in this Section 1 unless the context
otherwise requires (it being understood
that defined terms in this Agreement shall
include in the singular number the
plural and in the plural the singular):
1.1. Defined Terms
"Acceleration Notice" is defined is Section 9.
"Acquired Business" is defined in the recitals.
"Acquired Indebtedness" means Indebtedness of a Person or any of
its
Subsidiaries existing at the time such
Person becomes a Subsidiary of the
Borrower or at the time it merges or
consolidates with the Borrower or any of
its Subsidiaries or assumed in connection
with the acquisition of assets from
such Person and not incurred by such Person
in connection with, or in
anticipation or contemplation of, such
Person becoming a Subsidiary of the
Borrower or such acquisition, merger or
consolidation.
"Acquired Preferred Stock" means Preferred Stock of any Person at
the
time such Person becomes a Subsidiary of
the Borrower or at the time it merges
or consolidates with the Borrower or any of
its Subsidiaries and not issued by
such Person in connection with, or in
anticipation or contemplation of, such
acquisition, merger or consolidation.
"Acquisition" is defined in the recitals.
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"Acquisition Agreement" is defined in the recitals.
"Act" is defined in Section 11.17.
"Adjusted LIBOR" means, with respect to the Borrowing for any
Interest Period, an interest rate per annum
(rounded upwards, if necessary, to
the next 1/100 of 1%) equal to the product
of (a) LIBOR in effect for such
Interest Period and (b) Statutory
Reserves.
"Administrative Agent" means DBCI as the administrative agent for
the
Lenders under this Agreement and the other
Credit Documents.
"Administrative Agent's Office" means the office of the
Administrative Agent located at 60 Wall
Street, New York, New York 10005 or such
other office in New York City as the
Administrative Agent may hereafter
designate in writing as such to the other
parties hereto.
"Affiliate" means, as to any Person, any other Person who,
directly
or indirectly through one or more
intermediaries, controls, or is controlled by,
or is under common control with, the first
referred to 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.
"Affiliate Transaction" is defined in Section 8.6.
"Agents" means the Administrative Agent the Joint Lead Arrangers
and
the Joint Book Runners.
"Agreement" means this senior bridge loan agreement.
"Approved Fund" means any Fund that is administered, advised or
managed by (a) a Lender, (b) an Affiliate
of a Lender, or (c) an entity or an
Affiliate of an entity that administers,
advises or manages a Lender.
"ARISB Acquisition" means the acquisition of certain assets of
ADP
Claims Solutions, Group, Inc. ("ADP")
pursuant to the Asset Purchase Agreement
dated November 20, 1997 between the
Borrower and ADP.
"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 Borrower or any of
its Subsidiaries (excluding any Sale and
Leaseback Transaction or any pledge of
assets or stock by the Borrower or any of
its Subsidiaries) to any Person other
than the Borrower or a Wholly Owned
Subsidiary of the Borrower of (i) any
Capital Stock of any Subsidiary of the
Borrower or (ii) any other property or
assets of the Borrower or any Subsidiary of
the Borrower other than in the
ordinary course of business; provided,
however, that for purposes of Section
8.1, Asset Sales shall not include (a) a
transaction or series of related
transactions in which the Borrower or its
Subsidiaries receive aggregate
consideration of less than $1.0 million,
(b) transactions covered by Section 8.5
or permitted by Section 8.11, (c) a
Restricted Payment that otherwise qualifies
under Section 8.2, (d) any disposition of
obsolete or worn out equipment or
equipment that is no longer useful in the
conduct of the business of the
Borrower and its Subsidiaries and that is
disposed of, in each case, in the
ordinary course of business or (e) sales of
receivables and leases in connection
with the lease financing activities
described in clause (xii) of the definition
of "Permitted Indebtedness."
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"Asset Swap" means the execution of a definitive agreement,
subject
only to approval of the United States
Federal Trade Commission, if applicable,
and other customary closing conditions,
that the Borrower in good faith believes
will be satisfied, for a substantially
concurrent purchase and sale, or
exchange, of Productive Assets between the
Borrower or any of its Subsidiaries
and another Person or group of affiliated
Persons; provided that any amendment
to or waiver of any closing condition that
individually or in the aggregate is
material to the Asset Swap shall be deemed
to be a new Asset Swap; it being
understood that an Asset Swap may include a
cash equalization payment made in
connection therewith; provided that such
cash payment, if received by the
Borrower or its Subsidiaries, shall be
deemed to be proceeds received from an
Asset Sale and applied in accordance with
Section 8.1.
"Assignment and Acceptance" is defined in Section 11.6(c).
"Assignor" is defined in Section 11.6(c).
"Bankruptcy Law" is defined in Section 9.
"benefited Lender" is defined is Section 11.8(a).
"Board" means the Board of Governors of the Federal Reserve System
of
the United States (or any successor).
"Board of Directors" means the Board of Directors or other
governing
body charged with the ultimate management
of any Person, or any duly authorized
committee thereof.
"Board Resolution" means, with respect to any Person, a duly
adopted
resolution of the Board of Directors of
such Person or a duly authorized
committee of such Board of Directors.
"Borrower" is defined in the preamble hereto.
"Borrowing" means the incurrence of Loans.
"Bridge Commitment Letter" means the acquisition financing
commitment
letter dated as of August 15, 2005 among
the Borrower, Holdings and the Initial
Lenders.
"Bridge Obligations" means the obligations of the Borrower under
or
in connection with this Agreement and the
other Credit Documents.
"Business Day" means any day other than a Saturday, a Sunday or a
day
on which banking institutions in New York,
New York or the city in which the
Administrative Agent is located are not
required to be open.
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"Capital Stock" means (i) with respect to any Person that is a
corporation, any and all shares, interests,
participations or other equivalents
(however designated) of capital 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.
"Capitalized Lease Obligation" means, as to any Person, the
obligation of such Person to pay rent or
other amounts under a lease to which
such Person is a party that is required to
be classified and accounted for as a
capital lease obligation under GAAP, and
for purposes of this definition, the
amount of such obligation at any date shall
be the capitalized amount of such
obligation at such date, determined in
accordance with GAAP.
"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 commercial bank organized under
the laws of the United States of America or
any state thereof or the District of
Columbia or any United States branch of a
foreign bank having at the date of
acquisition thereof combined capital and
surplus of not less than $500.0
million; (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 that
invest substantially all their
assets in securities of the types described
in clauses (i) through (v) above.
"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 Borrower to any Person or
group of related Persons for
purposes of Section 13(d) of the Exchange
Act (a "Group") (whether or not
otherwise in compliance with the provisions
of this Agreement), other than to a
Permitted Holder; (ii) a majority of the
Board of Directors of the Borrower or
Holdings shall consist of Persons who are
not Continuing Directors; or (iii) the
acquisition by any Person or Group of
related Persons (other than the Permitted
Holders or any direct or indirect
Subsidiary of any Permitted Holder, including
without limitation, Holdings) of the power,
directly or indirectly, to vote or
direct the voting of securities having more
than 50% of the ordinary voting
power for the election of directors of the
Borrower or Holdings.
"Closing Date" means the date on which the conditions precedent
set
forth in Section 5 shall have been
satisfied, which date shall be no later than
September 30, 2005.
"Closing Date MAE" means any change, effect, event, occurrence,
state
of facts or development that, individually
or in the aggregate with any other
change, effect, event, occurrence, state of
facts or development, is or is
reasonably likely to be materially adverse
to the assets, properties, financial
condition or results of operations of the
Acquired Business and its subsidiaries
taken as a whole or the ability of a party
to the Acquisition Agreement to
4
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consummate the transactions contemplated
thereby; provided that none of the
following shall be deemed in itself, or in
any combination, to constitute, and
none of the following shall be taken into
account in determining whether there
has been or will be, a "Closing Date MAE":
(a) any adverse change, effect,
event, occurrence, state of facts or
development attributable to the
announcement or pendency of the
transactions contemplated by the Acquisition
Agreement; (b) any adverse change, effect,
event, occurrence, state of facts or
development attributable to conditions
affecting the industry in which the
Acquired Business and its subsidiaries
participate, the U.S. economy as a whole
or the capital markets in general, other
than any adverse change, effect, event,
occurrence, state of facts or development
which disproportionately affects the
Acquired Business and its subsidiaries; (c)
any adverse change, effect, event,
occurrence, state of facts or development
resulting from or relating to
compliance with the terms of, or the taking
of any action required by, the
Acquisition Agreement; (d) any adverse
change, effect, event, occurrence, state
of facts or development arising from or
relating to any change in accounting
requirements or principles or any change in
applicable laws, rules or
regulations or the interpretation thereof;
(e) any matter set forth on any
disclosure schedule attached to the
Acquisition Agreement; or (f) any adverse
change, effect, event, occurrence, state of
facts or development arising from or
relating to the commencement, continuation
or escalation of a war, material
armed hostilities or other material
international or national calamity or act of
terrorism directly or indirectly involving
the United States of America.
"Code" means the United States 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 at the
date of this Agreement and any subsequent
provisions of the Code amendatory
thereof, supplemental thereto or
substituted therefor.
"Commitment Papers" means (a) the Bridge Commitment Letter and
(b)
the Engagement Letter.
"Commitments" means, as to any Lender, its obligation to make
an
Original Initial Loan to the Borrower
pursuant to Section 2.1(a) in an aggregate
amount not to exceed the amount set forth
under such Lender's name in Schedule
2.1(a) opposite the caption "Commitment
Amount" or in the Assignment and
Acceptance pursuant to which a Lender
acquires its Commitment, as the same may
be adjusted pursuant to Section 11.6 and to
convert its Initial Loans into Term
Loans as provided in Section 2.1(b).
"Commodity Agreement" means any commodity futures contract,
commodity
option or other similar agreement or
arrangement entered into by the Borrower or
any of its Subsidiaries designed to protect
the Borrower or any of its
Subsidiaries against fluctuations in the
price of commodities actually used in
the ordinary course of business of the
Borrower and its Subsidiaries.
"Confidential Information" is defined in Section 11.15.
"Consolidated Coverage Ratio" as of any date of determination
means
the ratio of (i) the aggregate amount of
Consolidated EBITDA for the four
quarter period of the most recent four
consecutive fiscal quarters ending prior
to the date of such determination (the
"Four Quarter Period") to (ii)
Consolidated Fixed Charges for such Four
Quarter Period; provided, however, that
(1) if the Borrower or any Subsidiary of
the Borrower has incurred any
Indebtedness or issued any Preferred Stock
since the beginning of such Four
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Quarter Period that remains outstanding on
such date of determination or if the
transaction giving rise to the need to
calculate the Consolidated Coverage Ratio
is an incurrence of Indebtedness or
issuance of Preferred Stock, Consolidated
EBITDA and Consolidated Fixed Charges for
such Four Quarter Period shall be
calculated after giving effect on a pro
forma basis to the incurrence of such
Indebtedness or issuance of Preferred Stock
as if such Indebtedness had been
incurred or such Preferred Stock had been
issued on the first day of such Four
Quarter Period and the discharge of any
other Indebtedness or Preferred Stock
repaid, repurchased, defeased or otherwise
discharged with the proceeds of such
new Indebtedness or Preferred Stock as if
such discharge had occurred on the
first day of such Four Quarter Period, (2)
if since the beginning of such Four
Quarter Period the Borrower or any
Subsidiary of the Borrower shall have made
any Asset Sale, the Consolidated EBITDA for
such Four Quarter Period shall be
reduced by an amount equal to the
Consolidated EBITDA (if positive) directly
attributable to the assets that are the
subject of such Asset Sale for such Four
Quarter Period or increased by an amount
equal to the Consolidated EBITDA (if
negative) directly attributable thereto for
such Four Quarter Period and
Consolidated Fixed Charges for such Four
Quarter Period shall be reduced by an
amount equal to the Consolidated Fixed
Charges directly attributable to any
Indebtedness or Preferred Stock of the
Borrower or any Subsidiary of the
Borrower repaid, repurchased, defeased or
otherwise discharged with respect to
the Borrower and its continuing
Subsidiaries in connection with such Asset Sale
for such Four Quarter Period (or, if the
Capital Stock of any Subsidiary of the
Borrower is sold, the Consolidated Fixed
Charges for such Four Quarter Period
directly attributable to the Indebtedness
of such Subsidiary to the extent the
Borrower and its continuing Subsidiaries
are no longer liable for such
Indebtedness after such sale), (3) if since
the beginning of such Four Quarter
Period the Borrower or any Subsidiary of
the Borrower (by merger or otherwise)
shall have made an Investment in any
Subsidiary of the Borrower (or any Person
that becomes a Subsidiary of the Borrower)
or an acquisition of assets,
including any acquisition of assets
occurring in connection with a transaction
causing a calculation to be made hereunder,
which constitutes all or
substantially all of an operating unit of a
business, Consolidated EBITDA and
Consolidated Fixed Charges for such Four
Quarter Period shall be calculated
after giving pro forma effect thereto
(including the Incurrence of any
Indebtedness or the issuance of any
Preferred Stock) as if such Investment or
acquisition occurred on the first day of
such Four Quarter Period and (4) if
since the beginning of such Four Quarter
Period any Person (that subsequently
became a Subsidiary or was merged with or
into the Borrower or any Subsidiary of
the Borrower since the beginning of such
Four Quarter Period) shall have made
any Asset Sale or any Investment or
acquisition of assets that would have
required an adjustment pursuant to clause
(2) or (3) above if made by the
Borrower or a Subsidiary of the Borrower
during such Four Quarter Period,
Consolidated EBITDA and Consolidated Fixed
Charges for such Four Quarter Period
shall be calculated after giving pro forma
effect thereto as if such Asset Sale,
Investment or acquisition of assets
occurred on, with respect to any Investment
or acquisition, the first day of such Four
Quarter Period and, with respect to
any Asset Sale, the day prior to the first
day of such Four Quarter Period. For
purposes of this definition, whenever pro
forma effect is to be given to an
acquisition of assets, the amount of income
or earnings relating thereto and the
amount of Consolidated Fixed Charges
associated with any Indebtedness incurred
or the issuance of any Preferred Stock in
connection therewith, the pro forma
calculations shall be determined reasonably
and in good faith by a responsible
financial or accounting officer of the
Borrower. If any Indebtedness bears a
floating rate of interest and is being
given pro forma effect, the interest
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<PAGE>
expense on such Indebtedness shall be
calculated as if the rate in effect on the
date of determination had been the
applicable rate for the entire period (taking
into account any agreement under which
Interest Swap Obligations are outstanding
applicable to such Indebtedness if such
agreement under which such Interest Swap
Obligations are outstanding has a remaining
term as at the date of determination
in excess of 12 months); provided, however,
that the Consolidated Interest
Expense of the Borrower attributable to
interest on any Indebtedness incurred
under a revolving credit facility computed
on a pro forma basis shall be
computed based upon the average daily
balance of such Indebtedness during the
Four Quarter Period.
"Consolidated EBITDA" means, for any period, the Consolidated
Net
Income for such period, plus the following
to the extent deducted in calculating
such Consolidated Net Income: (i)
Consolidated Income Tax Expense for such
period; (ii) Consolidated Fixed Charges for
such period; and (iii) Consolidated
Non-Cash Charges for such period less all
non-cash items increasing Consolidated
Net Income for such period.
"Consolidated Fixed Charges" means, with respect to any Person
for
any period, the sum, without duplication,
of (i) Consolidated Interest Expense
and (ii) the amount of all cash dividend
payments or payments in Disqualified
Capital Stock on Preferred Stock of
Subsidiaries of such Person or on
Disqualified Capital Stock of such Person
held by Persons other than the
Borrower or any Wholly Owned Subsidiaries
paid, accrued or scheduled to be paid
or accrued during such period.
"Consolidated Income Tax Expense" means, with respect to the
Borrower
for any period, the provision for Federal,
state, local and foreign income taxes
payable by the Borrower and its
Subsidiaries for such period as determined on a
consolidated basis in accordance with
GAAP.
"Consolidated Interest Expense" means, with respect to any Person
for
any period, without duplication, the sum of
(i) the interest expense of such
Person and its Subsidiaries for such period
as determined on a consolidated
basis in accordance with GAAP, including,
without limitation, (a) any
amortization of debt discount, (b) the net
cost under Interest Swap Obligations
(including any amortization of discounts),
(c) the interest portion of any
deferred payment obligation, (d) all
commissions, discounts and other fees and
charges owed with respect to letters of
credit, bankers' acceptance financing or
similar facilities, and (e) all accrued or
capitalized interest and (ii) the
interest component of Capitalized Lease
Obligations paid or accrued by such
Person and its Subsidiaries during such
period as determined on a consolidated
basis in accordance with GAAP.
"Consolidated Net Income" of any Person means, for any period,
the
aggregate net income (or loss) of such
Person and its Subsidiaries for such
period on a consolidated basis, determined
in accordance with GAAP; provided,
however, that there shall be excluded
therefrom, without duplication, (a) gains
and losses from Asset Sales (without regard
to the $1.0 million limitation set
forth in the definition thereof) or
abandonments or reserves relating thereto
and the related tax effects, (b) items
classified as extraordinary or
nonrecurring gains and losses, and the
related tax effects according to GAAP,
(c) the net income (or loss) of any Person
acquired in a pooling of interests
transaction accrued prior to the date it
becomes a Subsidiary of such first
referred to Person or is merged or
consolidated with it or any of its
Subsidiaries, (d) the net income of any
Subsidiary to the extent that the
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<PAGE>
declaration of dividends or similar
distributions by that Subsidiary of that
income is restricted by contract, operation
of law or otherwise, (e) the net
income of any Person, other than the
Borrower or a Subsidiary of the Borrower or
other than an Unrestricted Subsidiary,
except to the extent of the lesser of (x)
dividends or distributions paid to such
first referred to Person or its
Subsidiary by such Person and (y) the net
income of such Person (but in no event
less than zero), and the net loss of such
Person shall be included only to the
extent of the aggregate Investment of the
first referred to Person or a
consolidated Subsidiary of such Person and
any non-cash expenses attributable to
grants or exercises of employee stock
options, (f) charges relating to the
amortization or write-off of intangibles or
other goodwill arising from the
ARISB Acquisition, the Triad Acquisition,
the Speedware Acquisition and the
Acquisition and (g) the cumulative effect
of changes in accounting principles.
"Consolidated Net Tangible Assets" of any Person means, as of
any
date of determination, the sum of the
assets of such Person after eliminating
intercompany items, determined on a
consolidated basis in accordance with GAAP,
including appropriate deductions for any
minority interest in tangible assets of
such Person's Subsidiaries, less (without
duplication) (i) the net book value of
all of its goodwill and other like
intangibles, (ii) unamortized Indebtedness
discount and expenses, (iii) all reserves
for depreciation, obsolescence,
depletion and amortization of its
properties and (iv) all other proper reserves
which in accordance with GAAP should be
provided in connection with the business
conducted by such Person, in each case as
calculated at the end of the fiscal
quarter preceding the date of determination
(and, if calculated in connection
with a transaction, after giving pro forma
effect to such transaction).
"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 Subsidiaries
(excluding any such charges constituting an
extraordinary or nonrecurring item)
reducing Consolidated Net Income of such
Person and its Subsidiaries for such
period, determined on a consolidated basis
in accordance with GAAP.
"Continuing Director" means, as of the date of determination,
any
Person who (i) was a member of the Board of
Directors of the Borrower or
Holdings on the Closing Date, (ii) was
nominated for election or elected to the
Board of Directors of the Borrower or
Holdings, as the case may be, with the
affirmative vote of a majority of the
Continuing Directors who were members of
such Board of Directors at the time of such
nomination or election or (iii) is a
representative of a Permitted Holder.
"Contractual Obligation" means, as applied to any Person, any
provision of any security issued by that
Person or of any indenture, mortgage,
deed of trust, contract, undertaking,
agreement or other instrument to which
that Person is a party or by which it or
any of its properties is bound or to
which it or any of its properties is
subject.
"Conversion Date" means the date the Initial Loans are converted
into
Term Loans pursuant to Section 2.1(b).
"Credit Agreement" means (i) the Fourth Amended and Restated
Credit
Agreement of the Borrower, dated as of the
Closing Date, together with the other
documents related thereto (including,
without limitation, any guarantee
agreements and security documents) as the
same may be further amended,
supplemented, restated, restored or
otherwise modified from time to time,
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<PAGE>
including amendments, supplements or
modifications relating to the addition or
elimination of Subsidiaries of the Borrower
as borrowers or guarantors or other
credit parties thereunder and (ii) any
renewal, extension, refunding,
restructuring, restatement, replacement or
refinancing thereof (whether with the
original administrative agent and lenders
or another administrative agent or
agents or one or more other lenders and
whether provided under the original
Credit Agreement or one or more other
credit or other agreements).
"Credit Documents" means this Agreement, the Guarantee Agreement
and
the Letter Agreement.
"Credit Party" means the Borrower and each Guarantor.
"Currency Agreement" means any foreign exchange contract,
currency
swap agreement or other similar agreement
or arrangement designed to protect the
Borrower or any of its Subsidiaries against
fluctuations in currency values.
"Custodian" is defined in Section 9.
"Debt Incurrence Prepayment Event" means any issuance or
incurrence
by the Borrower or any Subsidiary of the
Borrower (other than any Unrestricted
Subsidiary) of any Indebtedness of the type
described in clauses (i) and (ii) of
the definition thereof incurred by such
party in the form of debt securities
issued in a public offering or private
placement after the Closing Date and
prior to the Initial Maturity Date
(including, but not limited to Permanent
Securities, but not including Indebtedness
incurred pursuant to (a) the Credit
Agreement as in effect on the Closing Date
and (b) clauses (vi) and (xii) of the
definition of Permitted Indebtedness).
"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.
"Determination Date", with respect to an Interest Period, will be
the
second London Banking Day preceding the
first day of the Interest Period.
"Disqualified Capital Stock" means any Capital Stock that, by
its
terms (or by the terms of any security into
which it is convertible or for which
it is exchangeable), or upon the happening
of any event, matures (excluding any
maturity as the result of an optional
redemption by the issuer thereof) or is
mandatorily redeemable on or before April
1, 2010, pursuant to a sinking fund
obligation or otherwise, or is redeemable
at the sole option of the holder
thereof (except, in each case, upon the
occurrence of a Change of Control), in
whole or in part, on or prior to April 1,
2010; provided that only the portion
of Capital Stock which so matures or is
mandatorily redeemable or is so
redeemable at the sole option of the holder
thereof prior to April 1, 2010 shall
be deemed to be Disqualified Capital
Stock.
"Dollar", "dollar" or "$" means lawful currency of the United
States.
"Eligible Assignee" means (a) a Lender, (b) an Affiliate of a
Lender,
(c) an Approved Fund and (d) any other
Person (other than a natural person or
the Borrower or an Affiliate of the
Borrower) approved by the Administrative
Agent.
9
<PAGE>
"Engagement Letter" means the engagement letter dated as of
August
15, 2005, among the Borrower, Holdings and
the Joint Book Runners.
"Equity Interests" means Capital Stock and all warrants, options
or
other rights to acquire Capital Stock (but
excluding any debt security that is
convertible into, or exchangeable for,
Capital Stock).
"Equity Issuance Prepayment Event" means the receipt by Holdings
or
the Borrower of cash proceeds from the
issuance of their respective Equity
Interests (other than Equity Interests
issued pursuant to stock or stock option
plans existing on the Closing Date) prior
to the Initial Maturity Date.
"Equity Offering" means a private sale or an underwritten
public
offering of Capital Stock (other than
Disqualified Capital Stock) of the
Borrower or Holdings (to the extent, in the
case of Holdings, that the net cash
proceeds thereof are contributed to the
common or non-redeemable preferred
equity capital of the Borrower).
"ERISA" means the Employee Retirement Income Security Act of 1974,
as
amended from time to time, and any
successor thereto.
"Event of Default" is defined in Section 9.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended,
and the rules and regulations promulgated
by the SEC thereunder.
"Exchange and Registration Rights Agreement" means an Exchange
and
Registration Rights Agreement substantially
identical to the exchange and
registration rights agreement entered into
by the Borrower in connection with
the Existing Floating Rate Notes (with such
changes as may be required in
connection with the Transactions).
"Exchange Documents" means the Exchange Note Indenture and the
Exchange Notes.
"Exchange Note Indenture" means the indenture to be entered
into
relating to the Exchange Notes, having
terms and conditions substantially
similar to the Existing Floating Rate Notes
Indenture (with such changes to cure
any ambiguity, omission, defect or
inconsistency or as are otherwise required to
conform to the interest rate provisions and
optional redemption provisions
hereof or as otherwise required in
connection with the Transactions as the Joint
Lead Arrangers and the Borrower shall
approve) as in effect on the Closing Date.
"Exchange Note Trustee" means the trustee under the Exchange
Note
Indenture.
"Exchange Notes" means the debt securities issued under the
Exchange
Note Indenture.
"Exchange Request" is defined in Section 7.3(b).
"Existing Fixed Rate Notes" means $157.0 million aggregate
principal
amount of 10 1/2% Senior Notes due 2011
issued pursuant to the Existing Fixed
Rate Notes Indenture.
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<PAGE>
"Existing Fixed Rate Notes Guarantee" means the guarantee of
the
Existing Fixed Rate Notes by each of the
Existing Fixed Rate Notes Guarantors.
"Existing Fixed Rate Notes Guarantor" means the issuer at any time
of
an Existing Fixed Rate Notes Guarantee (so
long as such Existing Fixed Rate
Notes Guarantee remains outstanding).
"Existing Fixed Rate Notes Indenture" means the indenture dated
June
27, 2003 between the Company, the Existing
Fixed Rate Notes Guarantors named
therein and Wells Fargo Bank, National
Association, as successor by merger to
Wells Fargo Bank Minnesota, N.A., as
trustee, pursuant to which the Existing
Fixed Rate Notes were issued, as the same
may be amended, supplemented,
exchanged or restated from time to
time.
"Existing Fixed Rate Notes Issue Date" means June 27, 2003.
"Existing Floating Rate Notes" means $120.0 million aggregate
principal amount of Floating Rate Notes due
2010 issued pursuant to the Existing
Floating Rate Notes Indenture.
"Existing Floating Rate Notes Guarantee" means the guarantee of
the
Existing Floating Rate Notes by each of the
Existing Floating Rate Notes
Guarantors.
"Existing Floating Rate Notes Guarantor" means the issuer at any
time
of an Existing Floating Rate Notes
Guarantee (so long as such Existing Floating
Rate Notes Guarantee remains
outstanding).
"Existing Floating Rate Notes Indenture" means the indenture
dated
March 30, 2005 between the Company, the
Existing Floating Rate Notes Guarantors
named therein and Wells Fargo Bank,
National Association, as trustee, pursuant
to which the Existing Floating Rate Notes
were issued, as the same may be
amended, supplemented, exchanged or
restated from time to time.
"Existing Notes" means the Existing Fixed Rate Notes and the
Existing
Floating Rate Notes.
"Existing Notes Guarantee" means the guarantee of the Existing
Notes
by each of the Existing Notes
Guarantors.
"Existing Notes Guarantor" means the issuer at any time of an
Existing Floating Rate Notes Guarantee or
an Existing Fixed Rate Notes Guarantee
(so long as such Existing Floating Rate
Notes Guarantee or such Existing Fixed
Rate Notes Guarantee remains
outstanding).
"Existing Notes Indentures" means the Existing Fixed Rate Notes
Indenture and the Existing Floating Rate
Notes Indenture.
"Fees" means all amounts payable pursuant to, or referred to
in,
Section 3.1.
"Final Maturity Date" means April 1, 2010.
11
<PAGE>
"Financial Monitoring and Oversight Agreements" means the
Monitoring
and Oversight Agreement among the Borrower,
Holdings and Hicks Muse & Co.
Partners, L.P. ("Hicks Muse Partners") and
the Financial Advisory Agreement
among the Borrower, Holdings and Hicks Muse
Partners, each as in effect on the
Existing Fixed Rate Notes Issue Date or as
may be subsequently amended in a way
not materially adverse to the Lenders or
the Borrower.
"Fund" means any Person (other than a natural person) that is
engaged
in making, purchasing, holding or otherwise
investing in commercial loans and
similar extensions of credit in the
ordinary course of its business.
"GAAP", unless otherwise indicated, means generally accepted
accounting principles in the United States
of America as in effect as of the
date of this Agreement, including those 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 the
Commission or in such other statements by such
other entity as approved by a significant
segment of the accounting profession.
All ratios and computations based on GAAP
contained in this Agreement shall be
computed in conformity with GAAP.
"Governmental Authority" means any nation or government, any state
or
other political subdivision thereof, and
any entity exercising executive,
legislative, judicial, regulatory or
administrative functions of or pertaining
to government.
"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.
"Guarantee" means any guarantee of the Bridge Obligations by a
Guarantor in accordance with the provisions
of this Agreement and pursuant to
the Guarantee Agreement. When used as a
verb, "Guarantee" shall have a
corresponding meaning.
"Guarantee Agreement" means a Guarantee Agreement substantially
in
the form of Exhibit E, including any
Guarantee Supplement.
"Guarantee Supplement" means a Guarantee Supplement, substantially
in
the form of Annex A to the Guarantee
Agreement, entered into pursuant to the
terms hereof and thereof.
"Guaranteed Indebtedness" has the meaning provided in Section
8.9.
"Guarantor" means any Person that incurs a Guarantee on the
Closing
Date or following the Closing Date as
required pursuant to Section 8.9; provided
that upon the release and discharge of such
Person from its Guarantee in
accordance with this Agreement, such Person
shall cease to be a Guarantor.
"Hicks Muse" means Hicks, Muse, Tate & Furst Incorporated, a
Texas
corporation.
"Holdings" is defined in the preamble hereto.
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<PAGE>
"Holdings Financing" means the borrowing by Holdings of up to
$40.0
million in the form of a senior bridge loan
or from proceeds the issuance of
debt securities substantially on the terms
described in the Bridge Commitment
Letter.
"incur" has the meaning set forth in Section 8.3(a).
"Indebtedness" means with respect to any Person, without
duplication,
any liability of such Person (i) for
borrowed money, (ii) evidenced by bonds,
debentures, notes or other similar
instruments, (iii) constituting Capitalized
Lease Obligations, (iv) incurred or assumed
as the deferred purchase price of
property, or pursuant to conditional sale
obligations and title retention
agreements (but excluding trade accounts
payable arising in the ordinary course
of business), (v) for the reimbursement of
any obligor on any letter of credit,
banker's acceptance or similar credit
transaction, (vi) for Indebtedness of
others guaranteed by such Person, (vii) for
Interest Swap Obligations, Commodity
Agreements and Currency Agreements and
(viii) for Indebtedness of any other
Person of the type referred to in clauses
(i) through (vii) which is secured by
any Lien on any property or asset of such
first referred to Person, the amount
of such Indebtedness being deemed to be the
lesser of the value of such property
or asset or the amount of the Indebtedness
so secured. The amount of
Indebtedness of any Person at any date
shall be the outstanding principal amount
of all unconditional obligations described
above, as such amount would be
reflected on a balance sheet prepared in
accordance with GAAP, and the maximum
liability at such date of such Person for
any contingent obligations described
above.
"indemnified liabilities" is defined in Section 11.5(a).
"Initial Lenders" is defined in the preamble.
"Initial Loans" means, as of any date of determination, the
Original
Initial Loans together with any PIK
Interest Amounts which have been added
thereto.
"Initial Maturity Date" means the date that is one year after
the
Closing Date.
"Initial Notes" is defined in Section 11.6(d).
"Interest Payment Date" is defined in Section 2.6(d).
"Interest Period" means the interest period applicable to any
Loan,
as set forth in Section 2.7.
"Interest Swap Obligations" means the obligations of any Person
under
any interest rate protection agreement,
interest rate future, interest rate
option, interest rate swap, interest rate
cap or other interest rate hedge or
arrangement.
"Investment" in any Person means any direct or indirect advance,
loan
or other extension of credit (in each case,
including by way of Guarantee or
similar arrangement) or capital
contribution to any Person, but excluding any
debt or extension of credit represented by
a bank deposit other than a time
deposit. For purposes of Section 8.2, (A)
"Investment" shall include the portion
(proportionate to the Borrower's equity
interest in a Subsidiary to be
designated as an Unrestricted Subsidiary)
of the fair market value of the net
assets of such Subsidiary of the Borrower
at the time that such Subsidiary is
13
<PAGE>
designated an Unrestricted Subsidiary;
provided, however, that upon a
redesignation of such Unrestricted
Subsidiary as a Subsidiary, the Borrower
shall be deemed to continue to have a
permanent "Investment" in an Unrestricted
Subsidiary in an amount (if positive) equal
to (1) the Borrower's "Investment"
in such Subsidiary at the time of such
redesignation less (2) the portion
(proportionate to the Borrower's equity
interest in such Subsidiary) of the fair
market value of the net assets of such
Subsidiary at the time that such
Subsidiary is so redesignated from an
Unrestricted Subsidiary to a Subsidiary;
and (B) any property transferred to or from
an Unrestricted Subsidiary shall be
valued at its fair market value at the time
of such transfer, in each case as
determined in good faith by the Board of
Directors.
"Investment Company Act" means the United States Investment
Company
Act of 1940, as amended.
"Joint Book Runners" is defined in the preamble.
"Joint Lead Arrangers" is defined in the preamble.
"Laws" means, collectively, all applicable international,
foreign,
federal, state and local statutes,
treaties, rules, guidelines, regulations,
ordinances, codes and administrative or
binding judicial precedents or
authorities, including the interpretation
or administration thereof by any
Governmental Authority charged with the
enforcement, interpretation or
administration thereof, and all applicable
administrative orders, directed
duties, licenses, authorizations and
permits of, and binding agreements with,
any Governmental Authority, in each case
whether or not having the force of law.
"Lenders" means (a) the financial institutions listed on the
signature pages of this Agreement (other
than any such financial institution
that has ceased to be a party hereto
pursuant to an Assignment and Acceptance)
and (b) any financial institution that has
become a party hereto pursuant to an
Assignment and Acceptance.
"Letter Agreement" means the letter agreement dated as of the
Closing
Date among Borrower, Holdings and the Joint
Lead Arrangers.
"LIBOR" with respect to an Interest Period, will be the rate
(expressed as a percentage per annum) for
deposits in United States dollars for
three-month periods beginning on the first
day of such Interest Period that
appears on either Telerate Page 3750 or
Bloomberg page BBAM1 as of 11:00 a.m.,
London time, on the Determination Date. If
Telerate Page 3750 and Bloomberg page
BBAM1 do not include such a rate or are
unavailable on a Determination Date, the
Administrative Agent will request the
principal London office of each of four
major banks in the London interbank market,
as selected by the Administrative
Agent, to provide such bank's offered
quotation (expressed as a percentage per
annum), as of approximately 11:00 a.m.,
London time, on such Determination Date,
to prime banks in the London interbank
market for deposits in a Representative
Amount in United States dollars for a
three-month period beginning on the first
day of such Interest Period. If at least
two such offered quotations are so
provided, LIBOR for the Interest Period
will be the arithmetic mean of such
quotations. If fewer than two such
quotations are so provided, the
Administrative Agent will request each of
three major banks in New York City, as
selected by the Administrative Agent, to
provide such bank's rate (expressed as
a percentage per annum), as of
approximately 11:00 a.m., New York City time, on
14
<PAGE>
such Determination Date, for loans in a
Representative Amount in United States
dollars to leading European banks for a
three-month period beginning on the
first day of such Interest Period. If at
least two such rates are so provided,
LIBOR for the Interest Period will be the
arithmetic mean of such rates. If
fewer than two such rates are so provided,
then LIBOR for the Interest Period
will be LIBOR in effect with respect to the
immediately preceding Interest
Period.
"LIBOR Spread" means:
(i) during the period beginning on the Closing Date through
December 12, 2005, 650 basis points,
(ii) during the period beginning on December 13, 2005 through
March 12, 2006, 700 basis points,
(iii) during the period beginning on March 13, 2006 through
June
12, 2006, 750 basis points, and
(iv) during the period beginning on June 13, 2006 through
September 12, 2006, 800 basis points.
"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).
"Loans" means the Initial Loans and the Term Loans.
"London Banking Day" is any day on which dealings in United
States
dollars are transacted or, with respect to
any future date, are expected to be
transacted in the London interbank
market.
"Material Adverse Effect" means (i) a material adverse effect on
the
business, operations, assets, liabilities
(actual or contingent) or condition
(financial or otherwise) of Holdings, the
Borrower and its Subsidiaries
(including the Acquired Business), taken as
a whole, (ii) a material adverse
effect on the ability of the Borrower or
the Credit Parties (taken as a whole)
to perform their respective obligations
under any Credit Document to which the
Borrower or any of the Credit Parties is a
party or (iii) a material adverse
effect on the rights and remedies of the
Lenders under any Credit Document.
"Maximum Rate" is defined in Section 2.6(f).
"Moody's" means Moody's Investors Service, Inc.
"Net Cash Proceeds" means, with respect to (a) any Asset Sale,
(b)
any Debt Incurrence Prepayment Event or (c)
any Equity Issuance Prepayment Event
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) received by the Borrower
or any of its Subsidiaries from any
event described in clauses (a) through (c)
above net of (i) reasonable
out-of-pocket expenses and fees relating to
such transaction (including, without
limitation, legal, accounting and
investment banking fees and sales commissions,
15
<PAGE>
recording fees, relocation costs, title
insurance premiums, appraisers, fees and
costs reasonably incurred in preparation of
any asset or property for sale),
(ii) taxes paid or reasonably estimated to
be payable (calculated based on the
combined state, federal and foreign
statutory tax rates applicable to the
Borrower or the Subsidiary engaged in such
transaction), (iii) in the case of an
Asset Sale, all distributions and other
payments required to be made to any
Person owning a beneficial interest in the
assets subject to sale or minority
interest holders in Subsidiaries or joint
ventures as a result of such
transaction, (iv) any reserves established
in accordance with GAAP for
adjustment in respect of the sales price of
such asset or assets or for any
liabilities associated with such
transaction and (v) repayment of Indebtedness
secured by assets subject to such
transaction; provided, however, that if the
instrument or agreement governing such
transaction requires the transferor to
maintain a portion of the purchase price in
escrow (whether as a reserve for
adjustment of the purchase price or
otherwise) or to indemnify the transferee
for specified liabilities in a maximum
specified amount, the portion of the cash
or Cash Equivalents that is actually placed
in escrow or segregated and set
aside by the transferor for such
indemnification obligation shall not be deemed
to be Net Cash Proceeds until the escrow
terminates or the transferor ceases to
segregate and set aside such funds, in
whole or in part, and then only to the
extent of the proceeds released from escrow
to the transferor or that are no
longer segregated and set aside by the
transferor.
"Net Proceeds Offer" is defined in Section 8.1.
"Non-Excluded Taxes" is defined in Section 4.4(a).
"Non-U.S. Lender" is defined in Section 4.4(a).
"Notes" means the Initial Notes and the Term Notes, in each case,
as
originally executed or as they may from
time to time be amended pursuant to the
applicable provisions hereof.
"Notice of Borrowing" is defined in Section 2.2(a).
"Obligations" means all obligations for principal, premium,
interest,
penalties, fees, indemnifications,
reimbursements, damages and other liabilities
payable under the documentation governing,
or otherwise relating to, any
Indebtedness.
"Officers' Certificate" means a certificate signed on behalf of
the
Borrower by two Responsible Officers of the
Borrower, one of whom must be the
principal executive officer, the principal
financial officer, the treasurer or
the principal accounting officer of the
Borrower.
"Opinion of Counsel" means a written opinion from legal counsel
who
is reasonably acceptable to the
Administrative Agent. The counsel may be an
employee of or counsel to the Borrower.
"Organizational Documents" means (i) with respect to any
corporation,
its certificate or articles of
incorporation or organization, as amended, and
its by-laws, as amended, (ii) with respect
to any limited partnership, its
certificate of limited partnership, as
amended, and its partnership agreement,
as amended, (iii) with respect to any
general partnership, its partnership
agreement, as amended, and (iv) with
respect to any limited liability company,
its certificate or articles of formation or
organization, as amended, and its
operating agreement, as amended.
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<PAGE>
"Original Initial Loans" is defined in Section 2.1(a).
"Original Initial Notes" is defined in Section 11.6(d).
"Original Term Loans" is defined in Section 2.1(b).
"Original Term Notes" is defined in Section 11.6(d).
"Other Indebtedness" is defined in Section 8.1.
"Participant" is defined in Section 11.6(b).
"Payment Sharing Notice" means a notice from any Lender to the
Administrative Agent stating that an Event
of Default has occurred and that such
Lender requires that all payments received
by the Administrative Agent under
this Agreement or any Credit Document be
distributed in accordance with Section
4.6(b)(ii).
"Permanent Securities" means any debt or high yield-like
preferred
stock issued by the Borrower as permanent
financing to refinance the Loans,
Notes or Exchange Notes.
"Permitted Holders" means Hicks Muse and any of its Affiliates,
officers and directors.
"Permitted Indebtedness" means, without duplication, (i)
Indebtedness
outstanding on the Closing Date (other than
the indebtedness described in clause
(iv) below); (ii) Indebtedness of the
Borrower or a Subsidiary incurred pursuant
to the Credit Agreement (including
guarantees thereof) in an aggregate principal
amount at any time outstanding not to
exceed (x) prior to the Conversion Date,
$20.0 million and (y) thereafter, $30.0
million; (iii) Indebtedness evidenced by
or arising under the Loans or Exchange
Notes and the Credit Documents; (iv) the
Existing Notes and the Existing Notes
Guarantee; (v) Interest Swap Obligations;
provided, however, that such Interest Swap
Obligations are entered into to
protect the Borrower and its Subsidiaries
from fluctuations in currencies or
interest rates of its Indebtedness; (vi)
additional Indebtedness of the Borrower
or any of its Subsidiaries not to exceed
(x) prior to the Conversion Date, $15.0
million and (y) thereafter, $20.0 million
in principal amount outstanding at any
time (which amount may, but need not, be
incurred under the Credit Agreement);
(vii) Refinancing Indebtedness; (viii)
Indebtedness owed by the Borrower to any
Wholly Owned Subsidiary of the Borrower or
by any Subsidiary of the Borrower to
the Borrower or any Wholly Owned Subsidiary
of the Borrower; (ix) guarantees by
the Borrower or Subsidiaries of any
Indebtedness permitted to be incurred by the
Borrower or its Subsidiaries pursuant to
this Agreement; (x) Indebtedness in
respect of performance bonds, bankers'
acceptances and surety or appeal bonds
provided by the Borrower or any of its
Subsidiaries to their customers in the
ordinary course of their business; (xi)
Indebtedness arising from agreements
providing for indemnification, adjustment
of purchase price or similar
obligations, or from guarantees or letters
of credit, surety bonds or
performance bonds securing any obligations
of the Borrower or any of its
Subsidiaries pursuant to such agreements,
in each case incurred in connection
with the disposition of any business assets
or Subsidiaries of the Borrower
(other than guarantees of Indebtedness or
other obligations incurred by any
17
<PAGE>
Person acquiring all or any portion of such
business assets or Subsidiaries of
the Borrower for the purpose of financing
such acquisition) in a principal
amount not to exceed the gross proceeds
actually received by the Borrower or any
of its Subsidiaries in connection with such
disposition; provided, however, that
the principal amount of any Indebtedness
incurred pursuant to this clause (xi),
when taken together with all Indebtedness
incurred pursuant to this clause (xi)
and then outstanding, shall not exceed
$15.0 million; (xii) Indebtedness
represented by Capitalized Lease
Obligations, mortgage financings or purchase
money obligations, or Indebtedness incurred
for the purposes of financing the
acquisition of Productive Assets (whether
by acquisition of assets or stock, by
way of merger, consolidation or otherwise),
in each case incurred for the
purpose of financing all or any part of the
purchase price or cost of
construction or improvement of property
used in a related business or incurred
to refinance any such purchase price or
cost of construction or improvement, in
each case incurred no later than 365 days
after the date of such acquisition or
the date of completion of such construction
or improvement; provided, however,
that the principal amount of any
Indebtedness incurred pursuant to this clause
(xii) shall not exceed $5.0 million at any
time outstanding; and (xiii)
Indebtedness and other Obligations of the
Borrower and its Subsidiaries related
to lease financing activities which are not
required to be treated as
indebtedness on a balance sheet, as
determined in accordance with GAAP as in
effect on the date such Indebtedness or
other Obligation is incurred.
"Permitted Investments" means (i) Investments by the Borrower or
any
Subsidiary of the Borrower to acquire the
stock or assets of any Person (or
Acquired Indebtedness or Acquired Preferred
Stock acquired in connection with a
transaction in which such Person becomes a
Subsidiary of the Borrower);
provided, however, that the primary
business of such person is in the good faith
judgment of management of the Borrower a
business reasonably related, ancillary
or complementary to the business of the
Borrower; provided, further, however,
that if any such Investment or series of
related Investments involves an
Investment by the Borrower in excess of
$3.0 million, Borrower's Consolidated
Coverage Ratio, calculated after giving
effect to such transaction, must be
greater than 2.00 to 1.00, (ii) Investments
received by the Borrower or its
Subsidiaries as consideration for a sale of
assets, (iii) Investments by the
Borrower or any Wholly Owned Subsidiary of
the Borrower in any Wholly Owned
Subsidiary of the Borrower (whether
existing on the Closing Date or created
thereafter) or any Person that after such
Investments, and as a result thereof,
becomes a Wholly Owned Subsidiary of the
Borrower and Investments in the
Borrower by any Wholly Owned Subsidiary of
the Borrower, (iv) Investments in
cash and Cash Equivalents, (v) Investments
in securities of trade creditors,
wholesalers or customers received pursuant
to any plan of reorganization or
similar arrangement, (vi) loans or advances
to employees of the Borrower or any
Subsidiary thereof for purposes of
purchasing the Borrower's Capital Stock and
other loans and advances to employees made
in the ordinary course of business
consistent with past practices of the
Borrower or such Subsidiary and (vii)
additional Investments in an aggregate
amount not to exceed $1.0 million at any
time outstanding.
"Permitted Liens" means, with respect to any Person:
(i) Pledges or deposits by such Person under workmen's
compensation laws, unemployment insurance laws or similar
legislation,
or good faith deposits in connection with bids, tenders,
contracts
(other than for the payment of Indebtedness) or leases to which
such
Person is a party, or deposits to secure public or statutory
obligations of such Person or deposits of cash or United States
government bonds to secure surety or appeal bonds to which such
Person
is a party, or deposits as security for contested taxes or
import
duties or for the payment of rent, in each case incurred in the
ordinary course of business;
18
<PAGE>
(ii) Liens imposed by law, such as carriers', warehousemen's
and
mechanics' Liens, in each case for sums not yet delinquent or
being
contested in good faith by appropriate proceedings;
(iii) Liens for taxes, assessments or other governmental
charges
not yet delinquent or which are being contested in good faith
by
appropriate proceedings;
(iv) Liens in favor of issuers of performance and surety bonds
or
bid bonds or with respect to other regulatory requirements or
letters
of credit issued pursuant to the request of and for the account
of
such
Person in the ordinary course of its business;
(v) Minor survey exceptions, minor encumbrances, easements or
reservations of, or rights of others for, licenses,
rights-of-way,
sewers, electric lines, telegraph and telephone lines and other
similar purposes, or zoning or other restrictions as to the use
of
real properties or Liens incidental to the conduct of the business
of
such Person or to the ownership of its properties which were
not
incurred in connection with Indebtedness and which do not in
the
aggregate materially adversely affect the value of said properties
or
materially impair their use in the operation of the business of
such
Person;
(vi) Liens securing Indebtedness permitted to be incurred
pursuant to clauses (ii), (iv), (v) and (xi) of the definition
of
"Permitted Indebtedness"; (vii) Liens existing on the Closing Date
and
described on Schedule 8.4;
(viii) Liens on property or shares of stock of a Person at the
time such Person becomes a Subsidiary of the Borrower;
provided,
however, such Liens are not created or incurred in connection with,
or
in
contemplation of, such other Person becoming such a Subsidiary
of
the Borrower; provided, further, however, that such Liens may
not
extend to any other property owned by the Borrower or any of
its
Subsidiaries;
(ix) Liens on property at the time the Borrower or one of its
Subsidiaries acquired the property, including any acquisition by
means
of a merger or consolidation with or into the Borrower or any of
its
Subsidiaries; provided, however, that such Liens are not created
or
incurred in connection with, or in contemplation of, such
acquisition;
provided, further, however, that the Liens may not extend to any
other
property owned by the Borrower or any of its Subsidiaries;
(x) Liens on 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;
19
<PAGE>
(xi) Leases, subleases and licenses of real property which do
not
materially interfere with the ordinary conduct of the business of
the
Borrower or any of its Subsidiaries;
(xii) Liens arising from Uniform Commercial Code financing
statement filings regarding operating leases entered into by
the
Borrower and its Subsidiaries in the ordinary course of
business;
(xiii) Liens in favor of the Borrower or its Subsidiaries;
(xiv) Liens on equipment of the Borrower or its Subsidiaries
granted in the ordinary course of business to the Borrower's or
such
Subsidiaries' client at which such equipment is located;
(xv) Liens to secure any refinancing, refunding, extension,
renewal or replacement (or successive refinancings, refundings,
extensions, renewals or replacements) as a whole, or in part, of
any
Indebtedness secured by any Lien referred to in clause (vi),
(vii),
(viii), (ix) or (xx) of this definition; provided, however, that
(A)
such new Lien shall be limited to all or part of the same
property
that secured the original Lien (plus improvements on such
property),
and (B) the Indebtedness secured by such Lien at such time is
not
increased to any amount greater than the sum of (A) the
outstanding
principal amount of or, if greater, committed amount of the
Indebtedness described under clause (vi), (vii), (viii) or (ix) at
the
time the original Lien became a Permitted Lien under this
Agreement,
and (B) an amount necessary to pay any fees and expenses,
including
premiums, related to such refinancing, refunding, extension,
renewal
or replacement;
(xvi) Judgment and attachment Liens not giving rise to an Event
of Default;
(xvii) Liens in favor of the Administrative Agent securing the
Obligations under the Credit Documents;
(xviii) Liens in favor of a banking institution arising by
operation of law encumbering deposits (including right of
set-off)
held by such banking institutions incurred in the ordinary course
of
business and which are within the general parameters customary in
the
banking industry;
(xix) Liens on assets of a Subsidiary (other than a Significant
Subsidiary) that is a non-United States Person and is not a
Guarantor;
and
(xx) after the Conversion Date, in addition to the Liens
referred
to in clauses (i) through (xix) above, Liens securing
Indebtedness
(other than Indebtedness that is subordinated to the Loans and
Notes)
in an aggregate principal amount at the time of the incurrence of
such
Liens not
to exceed 10% of the Borrower's Consolidated Net Tangible
Assets.
"Person" means an individual, partnership, corporation, limited
liability company, unincorporated
organization, trust or joint venture, or a
governmental agency or political
subdivision thereof.
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<PAGE>
"PIK Interest Amount" means the amount of interest accrued on
an
Initial Loan or a Term Loan that, in
accordance with Section 2.6(e), increases
the principal amount of the Initial Loans
or Term Loans, as applicable.
"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.
"Prepayment Event" means any Debt Incurrence Prepayment Event or
any
Equity Issuance Prepayment Event.
"Productive Assets" means assets of a kind used or usable by
the
Borrower and its Subsidiaries in its
business; provided, however, that
productive assets to be acquired by the
Borrower or its Subsidiaries shall be,
in the good faith judgment of management of
the Borrower, assets which are
reasonably related, ancillary or
complementary to the business of the Borrower
and its Subsidiaries as conducted on the
Closing Date.
"Qualified Capital Stock" means any Capital Stock that is not
Disqualified Capital Stock.
"Refinancing Indebtedness" means any refinancing of Indebtedness
of
the Borrower or any of its Subsidiaries
existing as of the Closing Date or
incurred in accordance with Section 8.3
(other than pursuant to clause (v) of
the definition of Permitted Indebtedness)
that does not (i) result in an
increase in the aggregate principal amount
of Indebtedness (such principal
amount to include, for purposes of this
definition, any premiums, penalties or
accrued interest paid with the proceeds of
the Refinancing Indebtedness) of such
Person or (ii) 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.
"Register" is defined in Section 11.6(e).
"Regulation T" means Regulation T of the Board as from time to
time
in effect and any successor to all or a
portion thereof establishing margin
requirements.
"Regulation U" means Regulation U of the Board as from time to
time
in effect and any successor to all or a
portion thereof establishing margin
requirements.
"Regulation X" means Regulation X of the Board as from time to
time
in effect and any successor to all or a
portion thereof establishing margin
requirements.
"Reimbursable Legal Expenses" means, as to each Joint Lead
Arranger,
the reasonable fees and disbursements of
Cahill Gordon & Reindel LLP in
connection with the Transactions or
otherwise arising out of such Joint Lead
Arranger's Commitments.
"Related Agreements" means the Acquisition Agreement, the
documents
governing the Holdings' Financing and the
documents governing the Credit
Agreement.
21
<PAGE>
"Representative Amount" means a principal amount of not less
than
$1.0 million for a single transaction in
the relevant market at the relevant
time.
"Required Lenders" means, at any date, Lenders having or
holding
Loans and Commitments representing more
than 50% of the sum of Loans and
Commitments outstanding at such date.
"Responsible Officer" means the chief executive officer,
president,
vice president-finance, chief financial
officer, treasurer or assistant
treasurer or other similar officer of a
Credit Party and, as to any document
delivered on the Closing Date, any vice
president, secretary or assistant
secretary. Any document delivered hereunder
that is signed by a Responsible
Officer of a Credit Party shall be
conclusively presumed to have been authorized
by all necessary corporate, partnership
and/or other action on the part of such
Credit Party and such Responsible Officer
shall be conclusively presumed to have
acted on behalf of such Credit Party.
"Restricted Payment" means (i) the declaration or payment of
any
dividend or the making of any other
distribution (other than dividends or
distributions payable in Qualified Capital
Stock or in options, rights or
warrants to acquire Qualified Capital
Stock) on shares of the Borrower's Capital
Stock, (ii) the purchase, redemption,
retirement or other acquisition for value
of any Capital Stock of the Borrower, or
any warrants, rights or options to
acquire shares of Capital Stock of the
Borrower, other than through the exchange
of such Capital Stock or any warrants,
rights or options to acquire shares of
any class of such Capital Stock for
Qualified Capital Stock or warrants, rights
or options to acquire Qualified Capital
Stock, (iii) the making of any principal
payment on, or the purchase, defeasance,
redemption, prepayment, decrease or
other acquisition or retirement for value,
prior to any scheduled final
maturity, scheduled repayment or scheduled
sinking fund payment, of, any
Indebtedness of the Borrower or its
Subsidiaries that is subordinated or junior
in right of payment to the Loans and Notes,
(iv) the making of any Investment
(other than a Permitted Investment) or (v)
prior to the Conversion Date, the
repurchase or retirement for value of any
Indebtedness (other than the pro rata
repayment of Loans) that is pari passu with
the Loans or the Guarantees, other
than the repayment of revolving
indebtedness under the Credit Agreement,
redemptions of the Existing Notes in
connection with an Net Proceeds Offer (as
defined in the Existing Notes Indentures)
or a Change of Control Offer (as
defined in the Existing Notes Indentures)
or the repayment of Indebtedness with
the proceeds of an Asset Sale, to the
extent such Indebtedness was secured by
the assets or property subject to such
Asset Sale.
"S&P" means Standard and Poor's Ratings Services, a division of
The
McGraw-Hill Companies, Inc.
"Sale and Leaseback Transaction" means an arrangement relating
to
property now owned or hereafter acquired
whereby the Borrower or a Subsidiary
transfers such property to a Person and the
Borrower or a Subsidiary leases it
from such Person.
"SEC" or "Commission" means the United States Securities and
Exchange
Commission.
"Securities Act" means the Securities Act of 1933, as amended,
and
the rules and regulations promulgated by
the SEC thereunder.
22
<PAGE>
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in
Article I, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act,
as such Regulation is in effect on
the date of this Agreement.
"Solvent" means, with respect to a particular date, that on such
date
(i) the present fair market value (or
present fair saleable value) of the assets
of Holdings and its Subsidiaries is not
less than the total amount of the
liabilities of Holdings and its
Subsidiaries on their total existing debts and
liabilities (including contingent
liabilities); (ii) Holdings and its
Subsidiaries are able to realize upon their
assets and pay their debts and other
liabilities, contingent obligations and
commitments as they mature and become
due in the normal course of business; (iii)
assuming consummation of the
Transactions contemplated by the Credit
Documents and the Acquisition Agreement,
Holdings and its Subsidiaries are not
incurring debts or liabilities beyond
their ability to pay as such debts and
liabilities mature; (iv) Holdings and its
Subsidiaries are not engaged in any
business or transaction, and do not propose
to engage in any business or transaction,
for which their property would
constitute unreasonably small capital after
giving due consideration to the
prevailing practice in the industry in
which Holdings is engaged; and (v)
Holdings and its Subsidiaries are not
otherwise insolvent under applicable
federal or state laws.
"Speedware" means Speedware Corporation Inc.
"Speedware Acquisition" means the acquisition of shares of
Capital
Stock of Speedware pursuant to the
Speedware Tender Offer, an amalgamation, a
statutory arrangement, a share
consolidating, purchasing additional shares in
the open market or in privately negotiated
transactions, or initiating another
takeover bid.
"Speedware Tender Offer" means the cash tender offer to purchase
all
of the outstanding shares of Capital Stock
of Speedware.
"Staats Repurchase Agreement" means the Securities Repurchase
Agreement, dated June 5, 2003, among Glenn
Staats, Preston Staats, Holdings, the
Borrower, Hicks Muse and certain other
parties thereto, as the same may be
amended in a manner which does not
adversely affect the Lenders.
"Stated Maturity" means, with respect to any Loan, the Final
Maturity
Date (unless the Loans are not converted
pursuant to Section 2.1(b), in which
case all references shall mean the Initial
Maturity Date).
"Statutory Reserves" means a fraction (expressed as a decimal),
the
numerator of which is the number one and
the denominator of which is the number
one minus the aggregate of the maximum
reserve percentages (including any
marginal, special, emergency or
supplemental reserves) expressed as a decimal
established by the Board and any other
banking authority, domestic or foreign,
to which the Administrative Agent or any
Lender (including any branch,
Affiliate, or other fronting office making
or holding a Loan) is subject with
respect to LIBOR, for Eurocurrency
Liabilities (as defined in Regulation D of
the Board). Such reserve percentages shall
include those imposed pursuant to
such Regulation D. Loans shall be deemed to
constitute Eurocurrency Liabilities
and to be subject to such reserve
requirements without benefit of or credit for
proration, exemptions or offsets that may
be available from time to time to any
Lender under such Regulation D. Statutory
Reserves shall be adjusted
automatically on and as of the effective
date of any change in any reserve
percentage.
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<PAGE>
"Subsequent Initial Note" is defined in Section 11.6(d)
"Subsequent Term Note" is defined in Section 11.6(d).
"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 through one or more
intermediaries, 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, through one or more
intermediaries, owned by such
Person. Notwithstanding anything in this
Agreement to the contrary, all
references to the Borrower and its
consolidated Subsidiaries or to financial
information prepared on a consolidated
basis in accordance with GAAP shall be
deemed to include the Borrower and its
Subsidiaries as to which financial
statements are prepared on a combined basis
in accordance with GAAP and to
financial information prepared on such a
combined basis. Notwithstanding
anything in this Agreement to the contrary,
an Unrestricted Subsidiary shall not
be deemed to be a Subsidiary for purposes
of Section 8 of this Agreement.
"Telerate Page 3750" means the display designated as "Page 3750"
on
the Moneyline Telerate service (or such
other page as may replace Page 3750 on
that service) or a successor service.
"Term Loans" means, as of any date of determination, the
Original
Term Loans together with any PIK Interest
Amounts which have been added thereto.
"Term Notes" means the Initial Term Notes and any Subsequent
Term
Notes.
"Total Commitments" means $140.0 million.
"Total Credit Exposure" means, at any date, the sum of the
outstanding principal amount of all Loans
and Commitments at such date.
"Transactions" means the Acquisition, the Refinancing, entering
into
this Agreement and the Credit Agreement and
making of the Loans, the Holdings
Financing and the issuance and sale of the
Permanent Securities, if any.
"Transferee" is defined in Section 11.6(g).
"Triad Acquisition" means the acquisition of Triad Systems
Corporation on February 27, 1997.
"United States" means the United States of America.
24
<PAGE>
"Unrestricted Subsidiary" means (x) a Subsidiary of the
Borrower
created after the Closing Date or (y)
Internet Auto Parts, Inc. ("IAP") if it
becomes a Subsidiary of the Borrower, in
each case so designated (together with
its Subsidiaries) by a resolution adopted
by the Board of Directors of the
Borrower; provided, however, that (a)
neither the Borrower nor any of its other
Subsidiaries (other than Unrestricted
Subsidiaries) (1) provides any credit
support for any Indebtedness of such
Unrestricted Subsidiary or its Subsidiaries
(including any undertaking, agreement or
instrument evidencing such
Indebtedness) or (2) is directly or
indirectly liable for any Indebtedness of
such Unrestricted Subsidiary or its
Subsidiaries and (b) except for IAP, such
Subsidiary and its Subsidiaries has no
property or assets (other than de minimis
assets resulting from the initial
capitalization of such Subsidiary). The Board
of Directors may designate any Unrestricted
Subsidiary to be a Subsidiary;
provided, however, that immediately after
giving effect to such designation (x)
Borrower's Consolidated Coverage Ratio must
be greater than 2.00 to 1.00 and (y)
no Default or Event of Default shall have
occurred or be continuing. Any
designation pursuant to this definition by
the Board of Directors of the
Borrower shall be evidenced to the
Administrative Agent by the filing with the
Administrative Agent of a certified copy of
the resolution of the Borrower's
Board of Directors giving effect to such
designation and an Officers'
Certificate certifying that such
designation complied with the foregoing
conditions.
"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 total
of the product 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 Subsidiary" of any Person means any Subsidiary of
such
Person of which all the outstanding voting
securities (other than directors'
qualifying shares) which normally have the
right to vote in the election of
directors are owned by such Person or any
Wholly Owned Subsidiary of such
Person.
1.2. Terms Generally
The definitions of terms herein shall apply equally to the
singular
and plural forms of the terms defined.
Whenever the context may require, any
pronoun shall include the corresponding
masculine, feminine and neuter forms.
The words "include," "includes" and
"including" shall be deemed to be followed
by the phrase "without limitation." The
word "will" shall be construed to have
the same meaning and effect as the word
"shall." Unless the context requires
otherwise (a) any definition of or
reference to any Credit Document, agreement,
instrument or other document herein shall
be construed as referring to such
agreement, instrument or other document as
from time to time amended,
supplemented or otherwise modified (subject
to any restrictions on such
amendments, supplements or modifications
set forth herein), (b) any reference
herein to any person shall be construed to
include such person's successors and
assigns, (c) the words "herein," "hereof"
and "hereunder," and words of similar
import, shall be construed to refer to this
Agreement in its entirety and not to
any particular provision hereof, (d) all
references herein to Articles,
Sections, Exhibits and Schedules shall be
construed to refer to Articles and
Sections of, and Exhibits and Schedules to,
this Agreement and (e) any reference
to any law or regulation herein shall refer
to such law or regulation as
amended, modified or supplemented from time
to time.
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1.3. Accounting Terms; GAAP
Except as otherwise expressly provided herein, all financial
statements to be delivered pursuant to this
Agreement shall be prepared in
accordance with GAAP and all terms of an
accounting or financial nature shall be
construed and interpreted in accordance
with GAAP as in effect from time to
time.
1.4. Resolution of Drafting Ambiguities
Each Credit Party acknowledges and agrees that it was represented
by
counsel in connection with the execution
and delivery of the Credit Documents to
which it is a party, that it and its
counsel reviewed and participated in the
preparation and negotiation hereof and
thereof and that any rule of construction
to the effect that ambiguities are to be
resolved against the drafting party
shall not be employed in the interpretation
hereof or thereof.
SECTION 2. Amount and
Terms of Credit
2.1. Commitment
(a) Initial Loans. Subject to and upon the terms and conditions
herein set forth, each Lender agrees,
severally and not jointly, to make a loan
(collectively, the "Original Initial
Loans") to the Borrower, which Original
Initial Loan (i) shall be made on the
Closing Date, (ii) may be repaid in
accordance with the provisions hereof, but
once repaid, may not be reborrowed,
(iii) shall not exceed for any such Lender
that aggregate principal amount that
equals the Commitment of such Lender at
such time and (iv) shall not exceed for
all Lenders at any time outstanding the
aggregate principal amount that equals
the Total Commitments then in effect.
(b) Term Loans. (i) Subject to the terms and conditions hereof and
in
reliance upon the representations and
warranties of the Borrower herein set
forth, the Borrower and each Lender
severally agrees, if the Initial Loans have
not been repaid in full, that the then
outstanding principal amount of its
Initial Loans shall, upon satisfaction of
the conditions set forth in Section
5.2, be converted into a loan
(individually, an "Original Term Loan" and
collectively, the "Original Term Loans") by
the Borrower on the Initial Maturity
Date in an aggregate principal amount equal
to the then outstanding principal
amount of its Initial Loans.
(ii) Upon the conversion of the Initial Loans into Term Loans,
each
Lender shall cancel on its records a
principal amount of the Initial Loans held
by such Lender corresponding to the
principal amount of Term Loans issued by
such Lender, which corresponding principal
amount of the Initial Loans shall be
satisfied by the conversion of such Initial
Loans into Term Loans in accordance
with this Section 2.1(b). Amounts repaid in
respect of Term Loans may not be
reborrowed.
2.2. Notice of Borrowing
(a) The Borrower shall give the Administrative Agent written
notice
(or telephonic notice promptly confirmed in
writing) at the Administrative
Agent's Office at least one (1) Business
Day prior to the Borrowing of Initial
Loans. Such notice (a "Notice of
Borrowing") shall be irrevocable and shall
specify (i) the date of such Borrowing
(which shall be a Business Day and the
Closing Date) and (ii) the amount of such
Borrowing. The Administrative Agent
shall promptly give each Lender written
notice (or telephonic notice promptly
confirmed in writing) of the Borrowing of
Initial Loans, of such Lender's
proportionate share thereof and of the
other matters covered by the Notice of
Borrowing.
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(b) Without in any way limiting the obligation of the Borrower
to
confirm in writing any notice it may give
hereunder by telephone, the
Administrative Agent may act prior to
receipt of written confirmation without
liability upon the basis of such telephonic
notice believed by the
Administrative Agent in good faith to be
from a Responsible Officer of the
Borrower. In each such case the Borrower
hereby waives the right to dispute the
Administrative Agent's record of the terms
of any such telephonic notice.
2.3. Disbursement of Funds
(a) Subject to and upon the terms and conditions herein set
forth,
each Initial Lender agrees, severally and
not jointly, no later than 12:00 noon
(New York time) on the date specified in
the Notice of Borrowing, to make
available its pro rata portion of the
Borrowing requested to be made on such
date in the manner provided below.
(b) Each Initial Lender shall make available all amounts it is
to
fund under the Borrowing in immediately
available funds in Dollars to the
Administrative Agent at the Administrative
Agent's Office and the Administrative
Agent will make available to the Borrower
by depositing to the Borrower's
account at the Administrative Agent's
Office or such other account as may be
agreed between the Administrative Agent and
the Borrower the aggregate of the
amounts so made available in the type of
funds received. Unless the
Administrative Agent shall have been
notified by any Initial Lender prior to the
date of the Borrowing that such Initial
Lender does not intend to make available
to the Administrative Agent its portion of
the Borrowing or Borrowings to be
made on such date, the Administrative Agent
may assume that such Initial Lender
has made such amount available to the
Administrative Agent on such date of
Borrowing, and the Administrative Agent, in
reliance upon such assumption, may
(in its sole discretion and without any
obligation to do so) make available to
the Borrower a corresponding amount. If
such corresponding amount is not in fact
made available to the Administrative Agent
by such Initial Lender and the
Administrative Agent has made available
same to the Borrower, the Administrative
Agent shall be entitled to recover such
corresponding amount from such Initial
Lender and the Borrower. If such Initial
Lender does not pay such corresponding
amount forthwith upon the Administrative
Agent's demand therefor, the
Administrative Agent shall promptly notify
the Borrower, and the Borrower shall
immediately pay such corresponding amount
to the Administrative Agent. The
Administrative Agent shall also be entitled
to recover from such Initial Lender
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 Administrative Agent to the Borrower
to the date such corresponding
amount is recovered by the Administrative
Agent, at a rate per annum equal to
the then-applicable rate of interest,
calculated in accordance with Section 2.6,
for the Loans.
(c) Nothing in this Section 2.3 shall be deemed to relieve any
Initial Lender from its obligation to
fulfill its commitments hereunder or to
prejudice any rights that the Borrower may
have against any Initial Lender as a
result of any default by such Initial
Lender hereunder (it being understood,
however, that no Initial Lender shall be
responsible for the failure of any
other Initial Lender or the Administrative
Agent to fulfill its commitments
hereunder).
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2.4. Initial Maturity Date; Final Maturity Date; Evidence of
Debt
(a) Subject to Section 2.1(b), the Initial Loans will mature on
the
Initial Maturity Date and, to the extent
then unpaid, will, upon satisfaction of
the conditions set forth in Section 5.2, be
converted into Term Loans or become
due and payable pursuant to Section
2.1(b).
(b) The Term Loans will mature on the Final Maturity Date. Any
Term
Loan shall bear interest as described in
Section 2.6 from the Conversion Date
until such Loan shall be paid in full or
exchanged for an Exchange Note pursuant
to Section 7.3.
(c) Each Lender shall maintain in accordance with its usual
practice
an account or accounts evidencing the
indebtedness of the Borrower to the
appropriate lending office of such Lender
resulting from each Loan made by such
lending office of such Lender from time to
time, including the amounts of
principal and interest payable and paid to
such lending office of such Lender
from time to time under this Agreement.
(d) The Administrative Agent shall maintain the Register pursuant
to
Section 11.6(e), and a subaccount for each
Lender, in which Register and
subaccounts (taken together) shall be
recorded (i) the amount of each Loan made
hereunder, (ii) the amount of any principal
or interest due and payable or to
become due and payable (including, without
limitation, any PIK Interest Amount
and any interest payable thereon) from the
Borrower to each Lender and (iii) the
amount of any sum received by the
Administrative Agent hereunder from the
Borrower and each Lender's share
thereof.
(e) The entries made in the Register and accounts and
subaccounts
maintained pursuant to paragraphs (c) and
(d) of this Section 2.4 shall, to the
extent permitted by applicable law, be
prima facie evidence of the existence and
amounts of the obligations of the Borrower
therein recorded; provided, however,
that the failure of any Lender or the
Administrative Agent to maintain such
account, such Register or such subaccount,
as applicable, or any error therein,
shall not in any manner affect the
obligations of the Borrower hereunder,
including obligations to repay (with
applicable interest) the Loans made to the
Borrower by such Lender in accordance with
the terms of this Agreement.
(f) Subject to the requirements set forth in Section 7.3, each
Lender
will have the option at any time or from
time to time after the Conversion Date
to receive Exchange Notes in exchange for
the Term Loans of such Lender then
outstanding. The principal amount of the
Exchange Notes will equal 100% of the
aggregate principal amount (including any
accrued PIK Interest Amount) of the
Term Loans for which they are exchanged. If
an Event of Default shall have
occurred and be continuing on the date of
such exchange, any notices given or
cure periods commenced while the Initial
Loans or Term Loans were outstanding
shall be deemed given or commenced (as of
the actual dates thereof) for all
purposes with respect to the Exchange Notes
(with the same effect as if the
Exchange Notes had been outstanding as of
the actual dates thereof).
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2.5. Pro Rata Borrowing
The Borrowing of Loans under this Agreement and any reduction
of
Commitments shall be made by or in favor of
the Lenders pro rata on the basis of
their Commitments. 2.6. Interest
(a) Except as provided in clauses (b) and (f) below, the unpaid
principal amount of each Initial Loan shall
bear interest from the date of the
Borrowing thereof (or, in the case of any
PIK Interest Amount that is added to
the Initial Loans, from the date such PIK
Interest Amount increases the
principal amount of the Initial Loans as
contemplated by clause (e) below) until
the date of repayment or conversion to a
Term Loan at a rate per annum equal to
the lesser of (i) the Maximum Rate and (ii)
Adjusted LIBOR plus the LIBOR Spread
as determined by the Administrative
Agent.
(b) If any event set forth in Section 2.8(a) shall have
occurred,
then (i) within 15 days after any notice
given to the Borrower by the affected
Lender or Lenders in accordance with
Section 2.8, the Agents and the Borrower
shall enter into negotiations in good faith
with a view to agreeing to an
alternative interest rate acceptable to the
Borrower to make, fund or maintain
affected Loans and (ii) if, at the
expiration of 30 days from the giving of such
notice by the Agents, the Agents and the
Borrower shall not have reached an
agreement, such Loans will bear interest at
a rate per annum specified by each
such Lender to represent its cost of funds
therefor plus the LIBOR Spread.
(c) Except as provided in clause (f) below, the unpaid
principal
amount of each Term Loan shall bear
interest for the period from and including
the Conversion Date (or, in the case of any
PIK Interest Amount that is added to
the Term Loans, from the date such PIK
Interest Amount increases the principal
amount of the Term Loans as contemplated by
clause (e) below) to, but excluding,
the earlier of (i) the date of repayment
thereof and (ii) the date of exchange
for an Exchange Note, at a rate equal to
the lesser of (x) the Maximum Rate and
(y) (A) for the Interest Period commencing
on the Conversion Date, the interest
rate, determined in accordance with Section
2.6(a) in effect on the day
immediately preceding the Conversion Date
plus 50 basis points and (B) for each
Interest Period thereafter, the interest
rate in effect for the immediately
preceding Interest Period plus 50 basis
points.
(d) Interest on each Loan shall be payable (i) in respect of
each
Initial Loan, quarterly in arrears on the
last day of each Interest Period
applicable thereto and on the Initial
Maturity Date, (ii) in respect of each
Term Loan, quarterly in arrears on the last
day of each Interest Period
applicable thereto and on the Final
Maturity Date, (iii) on the date of any
prepayment (on the amount prepaid)
including through the issuance of Exchange
Notes, (iv) at maturity (whether by
acceleration or otherwise), and (v) after
maturity (except to the extent the Initial
Loans have been converted), on demand
(each such date referred to in clauses (i),
(ii), (iii), (iv) and (v) being an
"Interest Payment Date").
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(e) Notwithstanding the foregoing clauses, the interest rate borne
by
the Loans shall not exceed 12.75% per annum
(the "Maximum Rate"); provided that,
the interest rates applicable to the Loans,
including the Maximum Rate, shall
increase by 0.75% if, at any time, the
Loans or other unsecured senior long-term
debt obligations of the Borrower (that do
not have any credit support by any
party other than the Borrower and its
Subsidiaries) have not received a rating
of better than CCC+ by Standard &
Poor's and a rating of better than Caa1 by
Moody's; provided further that if at any
time following such increase the
ratings are better than CCC+ and better
than Caa1, then such interest rates
sh
