Exhibit 4.3
EXECUTION COPY
CREDIT AGREEMENT
Dated as of November 20, 2007
among
REABLE THERAPEUTICS FINANCE LLC (to be renamed
DJO FINANCE LLC),
as
Borrower,
REABLE THERAPEUTICS HOLDINGS LLC (to be renamed
DJO HOLDINGS LLC),
as Holdings,
CREDIT SUISSE,
as
Administrative Agent, Collateral Agent, Swing Line Lender and L/C
Issuer,
THE
OTHER LENDERS PARTY HERETO,
BANC OF AMERICA SECURITIES LLC and
THE
BANK OF NOVA SCOTIA,
as
Co-Syndication Agents,
BANK OF THE WEST,
as
Documentation Agent,
and
CREDIT SUISSE SECURITIES (USA) LLC and
BANC OF AMERICA SECURITIES LLC,
as
Lead Arrangers and Book Runners
[CS&M 5865-581]
TABLE OF CONTENTS
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Page
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ARTICLE
I
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Definitions and
Accounting Terms
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SECTION 1.01.
Defined Terms
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1
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SECTION 1.02.
Other Interpretive Provisions
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50
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SECTION 1.03.
Accounting Terms
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51
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SECTION 1.04.
Rounding
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51
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SECTION 1.05.
References to Agreements, Laws, Etc
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51
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SECTION 1.06.
Times of Day
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52
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SECTION 1.07.
Timing of Payment of Performance
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52
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SECTION 1.08.
Currency Equivalents Generally
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52
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ARTICLE
II
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The Commitments
and Credit Extensions
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SECTION 2.01. The
Loans
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52
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SECTION 2.02.
Borrowings, Conversions and Continuations of Loans
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53
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SECTION 2.03.
Letters of Credit
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55
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SECTION 2.04.
Swing Line Loans
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65
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SECTION 2.05.
Prepayments
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67
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SECTION 2.06.
Termination or Reduction of Commitments
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72
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SECTION 2.07.
Repayment of Loans
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73
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SECTION 2.08.
Interest
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73
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SECTION 2.09.
Fees
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74
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SECTION 2.10.
Computation of Interest and Fees
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74
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SECTION 2.11.
Evidence of Indebtedness
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75
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SECTION 2.12.
Payments Generally
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76
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SECTION 2.13.
Sharing of Payments
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78
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SECTION 2.14.
Incremental Credit Extensions
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78
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ARTICLE
III
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Taxes, Increased
Costs Protection and Illegality
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SECTION 3.01.
Taxes
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81
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SECTION 3.02.
Illegality
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83
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SECTION 3.03.
Inability to Determine Rates
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83
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SECTION 3.04.
Increased Cost and Reduced Return; Capital Adequacy; Reserves on
Eurodollar Rate Loans
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84
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SECTION 3.05.
Funding Losses
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85
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SECTION 3.06.
Matters Applicable to All Requests for Compensation
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86
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i
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SECTION 3.07.
Replacement of Lenders under Certain Circumstances
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87
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SECTION 3.08.
Survival
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88
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ARTICLE
IV
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Conditions
Precedent to Credit Extensions
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SECTION 4.01.
Conditions of Initial Credit Extension
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89
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SECTION 4.02.
Conditions to All Credit Extensions
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91
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ARTICLE
V
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Representations
and Warranties
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SECTION 5.01.
Existence, Qualification and Power; Compliance with Laws
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92
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SECTION 5.02.
Authorization; No Contravention
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93
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SECTION 5.03.
Governmental Authorization; Other Consents
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93
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SECTION 5.04.
Binding Effect
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93
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SECTION 5.05.
Financial Statements; No Material Adverse Effect
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93
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SECTION 5.06.
Litigation
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95
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SECTION 5.07. No
Default
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95
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SECTION 5.08.
Ownership of Property; Liens
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95
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SECTION 5.09.
Environmental Compliance
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95
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SECTION 5.10.
Taxes
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96
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SECTION 5.11.
ERISA Compliance
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96
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SECTION 5.12.
Subsidiaries; Equity Interests
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97
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SECTION 5.13.
Margin Regulations; Investment Company Act
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97
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SECTION 5.14.
Disclosure
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97
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SECTION 5.15.
Solvency
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98
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SECTION 5.16.
Subordination of Junior Financing
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98
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SECTION 5.17.
Labor Matters
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98
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SECTION 5.18. Food
and Drug
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98
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SECTION 5.19.
Clinical Trials
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98
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SECTION 5.20.
State Food and Drug Laws
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98
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SECTION 5.21.
HIPAA
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99
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SECTION 5.22.
Medicare, Medicaid and Fraud and Abuse
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99
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ARTICLE
VI
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Affirmative
Covenants
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SECTION 6.01.
Financial Statements
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100
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SECTION 6.02.
Certificates; Other Information
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101
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SECTION 6.03.
Notices
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103
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SECTION 6.04.
Payment of Obligations
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104
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SECTION 6.05.
Preservation of Existence, Etc
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104
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SECTION 6.06.
Maintenance of Properties
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104
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ii
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SECTION 6.07.
Maintenance of Insurance
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104
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SECTION 6.08.
Compliance with Laws
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104
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SECTION 6.09.
Books and Records
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104
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SECTION 6.10.
Inspection Rights
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105
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SECTION 6.11.
Covenant to Guarantee Obligations and Give Security
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105
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SECTION 6.12.
Compliance with Environmental Laws
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107
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SECTION 6.13.
Further Assurances
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107
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SECTION 6.14.
Designation of Subsidiaries
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108
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ARTICLE
VII
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Negative
Covenants
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SECTION 7.01.
Liens
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109
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SECTION 7.02.
Investments
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113
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SECTION 7.03.
Indebtedness
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117
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SECTION 7.04.
Fundamental Changes
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121
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SECTION 7.05.
Dispositions
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122
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SECTION 7.06.
Restricted Payments
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124
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SECTION 7.07.
Change in Nature of Business
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127
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SECTION 7.08.
Transactions with Affiliates
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127
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SECTION 7.09.
Burdensome Agreements
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128
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SECTION 7.10. Use
of Proceeds
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129
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SECTION 7.11.
Financial Covenant
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129
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SECTION 7.12.
Accounting Changes
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130
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SECTION 7.13.
Prepayments, Etc. of Indebtedness
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130
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SECTION 7.14.
Equity Interests of the Company and Restricted
Subsidiaries
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131
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ARTICLE
VIII
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Events of Default
and Remedies
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SECTION 8.01.
Events of Default
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131
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SECTION 8.02.
Remedies Upon Event of Default
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133
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SECTION 8.03.
Exclusion of Immaterial Subsidiaries
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134
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SECTION 8.04.
Application of Funds
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134
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SECTION 8.05.
Company’s Right to Cure
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135
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ARTICLE
IX
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Administrative
Agent and Other Agents
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SECTION 9.01.
Appointment and Authorization of Agents
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136
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SECTION 9.02.
Delegation of Duties
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137
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SECTION 9.03.
Liability of Agents
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137
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SECTION 9.04.
Reliance by Agents
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138
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SECTION 9.05.
Notice of Default
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138
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iii
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SECTION 9.06.
Credit Decision; Disclosure of Information by Agents
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138
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SECTION 9.07.
Indemnification of Agents
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139
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SECTION 9.08.
Agents in their Individual Capacities
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140
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SECTION 9.09.
Successor Agents
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140
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SECTION 9.10.
Administrative Agent May File Proofs of Claim
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141
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SECTION 9.11.
Collateral and Guaranty Matters
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141
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SECTION 9.12.
Other Agents; Arrangers and Managers
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142
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SECTION 9.13.
Appointment of Supplemental Administrative Agents
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143
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ARTICLE
X
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Miscellaneous
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SECTION 10.01.
Amendments, Etc
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144
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SECTION 10.02.
Notices and Other Communications; Facsimile Copies
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146
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SECTION 10.03. No
Waiver; Cumulative Remedies
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147
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SECTION 10.04.
Attorney Costs, Expenses and Taxes
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148
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SECTION 10.05.
Indemnification by the Company
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148
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SECTION 10.06.
Payments Set Aside
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149
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SECTION 10.07.
Successors and Assigns
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149
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SECTION 10.08.
Confidentiality
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154
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SECTION 10.09.
Setoff
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155
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SECTION 10.10.
Interest Rate Limitation
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155
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SECTION 10.11.
Counterparts
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156
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SECTION 10.12.
Integration
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156
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SECTION 10.13.
Survival of Representations and Warranties
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156
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SECTION 10.14.
Severability
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156
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SECTION 10.15. Tax
Forms
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157
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SECTION 10.16. No
Advisory or Fiduciary Responsibility
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159
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SECTION 10.17.
GOVERNING LAW
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159
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SECTION 10.18.
WAIVER OF RIGHT TO TRIAL BY JURY
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160
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SECTION 10.19.
Binding Effect
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160
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SECTION 10.20.
Electronic Execution of Assignments
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160
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SECTION 10.21.
Effect of Certain Inaccuracies
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160
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SECTION 10.22. USA
PATRIOT Act
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161
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SECTION 10.23.
LEGEND
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161
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SCHEDULES
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1
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Guarantors
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1.01A
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Unrestricted
Subsidiaries
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1.01B
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Mortgaged
Properties
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1.01C
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Excluded
Subsidiaries
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1.01D
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Foreign
Subsidiaries
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1.01E
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Existing Letters
of Credit
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2.01
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Commitments
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iv
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5.08
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Real
Property
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5.09
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Environmental
Matters
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5.10
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Taxes
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5.11
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ERISA
Compliance
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5.12
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Subsidiaries and
Other Equity Investments
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7.01(b)
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Existing
Liens
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7.02(f)
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Existing
Investments
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7.03(b)
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Existing
Indebtedness
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7.05(l)
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Dispositions
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7.08
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Transactions with
Affiliates
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7.09
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Existing
Restrictions
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10.02
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Administrative
Agent’s Office, Certain Addresses for Notices
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EXHIBITS
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Form of
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A
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Loan
Notice
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B
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Swing Line Loan
Notice
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C-1
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Term
Note
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C-2
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Revolving Credit
Note
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D
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Compliance
Certificate
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E
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Assignment and
Assumption
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F
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Guaranty
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G-1
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Security
Agreement
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G-2
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Intellectual
Property Security Agreement
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H
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Deed of
Trust
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I
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Opinion Matters
— Counsel to Loan Parties
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J
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Administrative
Questionnaire
|
v
CREDIT AGREEMENT
This CREDIT
AGREEMENT (“ Agreement ”) dated as of November
20, 2007, among REABLE THERAPEUTICS FINANCE LLC (to be renamed DJO
Finance LLC), a Delaware limited liability company, (the “
Company ”), REABLE THERAPEUTICS HOLDINGS LLC (to be
renamed DJO Holdings LLC), a Delaware limited liability company
(“ Holdings ”), CREDIT SUISSE, as Administrative
Agent, Collateral Agent, Swing Line Lender and an L/C Issuer and
each lender from time to time party hereto (collectively, the
“ Lenders ” and individually, a “
Lender ”).
Pursuant to the
Merger Agreement (as this and other capitalized terms used in these
preliminary statements are defined in Section 1.01 below),
Reaction Acquisition Merger Sub, Inc., a Delaware corporation
(“ Merger Sub ” ) shall be merged with
and into DJO Incorporated, a Delaware corporation (“
Target ”), with the Target continuing as the surviving
corporation, becoming a wholly owned subsidiary of the Company and
to be renamed DJO Opco Holdings, Inc. (the “ Merger
”).
The Company has
requested that simultaneously with the consummation of the Merger,
the Lenders extend credit to the Company in the form of
(i) Term Loans in an initial aggregate amount of
$1,065,000,000 (which is to be funded at a 1.0% discount) and
(ii) a Revolving Credit Facility in an initial aggregate
amount of $100,000,000. The Revolving Credit Facility will include
a sub-limit for the making of one or more Swing Line Loans and for
the issuance of one or more Letters of Credit from time to
time.
The proceeds of
the Term Loans in an aggregate discounted funded amount of
$1,054,350,000, together with (i) the proceeds of the issuance
of the New Notes, (ii) the proceeds of the Equity Contribution and
(iii) cash on hand at the Company, will be used to finance the
Debt Prepayment, the payment of the Merger Consideration, the
payment of the Transaction Expenses and the funding of the
Post-Closing Integration Amount. The proceeds of Revolving Credit
Loans incurred on or after the Closing Date will be used for
working capital and other general corporate purposes of the Company
and its Subsidiaries, including the financing of Permitted
Acquisitions. Swing Line Loans and Letters of Credit will be used
for general corporate purposes of the Company and its
Subsidiaries.
The applicable
Lenders have indicated their willingness to lend, and the L/C
Issuers have indicated their willingness to issue Letters of
Credit, in each case, on the terms and subject to the conditions
set forth herein.
In consideration
of the mutual covenants and agreements herein contained, the
parties hereto covenant and agree as follows:
ARTICLE I
Definitions and Accounting
Terms
SECTION 1.01. Defined Terms . As used in
this Agreement, the following terms shall have the meanings set
forth below:
“
Acquired EBITDA ” means, with respect to any Acquired
Entity or Business or any Converted Restricted Subsidiary for any
period, the amount for such period of Consolidated EBITDA of such
Acquired Entity or Business or such Converted Restricted Subsidiary
(determined as if references to the Company and the Restricted
Subsidiaries in the definition of Consolidated EBITDA were
references to such Acquired Entity or Business and its Subsidiaries
or to such Converted Restricted Subsidiary and its Subsidiaries),
all as determined on a consolidated basis for such Acquired Entity
or Business.
“
Acquired Entity or Business ” has the meaning set
forth in the definition of the term “Consolidated
EBITDA”.
“ Act
” has the meaning set forth in Section 10.21.
“
Additional Lender ” has the meaning set forth in
Section 2.14(a).
“
Administrative Agent ” means Credit Suisse, in its
capacity as administrative agent under any of the Loan Documents,
or any successor administrative agent.
“
Administrative Agent’s Office ” means the
Administrative Agent’s address and, as appropriate, account
as set forth on Schedule 10.02 or such other address or
account as the Administrative Agent may from time to time notify
the Company and the Lenders.
“
Administrative Questionnaire ” means an Administrative
Questionnaire in the form of Exhibit J or such other form as may be
supplied from time to time by the Administrative Agent.
“
Affiliate ” means, with respect to any Person, another
Person that directly, or indirectly through one or more
intermediaries, Controls or is Controlled by or is under common
Control with the Person specified. “Control” means the
possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or
otherwise. “Controlling” and “Controlled”
have meanings correlative thereto.
“
Agent-Related Persons ” means the Agents, together
with their respective Affiliates, and the officers, directors,
employees, agents and attorneys-in-fact of such Persons and
Affiliates.
“
Agents ” means, collectively, the Administrative
Agent, the Collateral Agent and the Supplemental Administrative
Agents (if any).
“
Aggregate Commitments ” means the Commitments of all
the Lenders.
“
Agreement ” has the meaning set forth in the
introductory paragraph hereof.
2
“
Applicable Rate ” means a percentage per annum equal
to (a) until delivery of financial statements for the first
full fiscal quarter commencing on or after the Closing Date
pursuant to Section 6.01, (i) for Eurodollar Rate Loans
that are Revolving Credit Loans, 3.00%, (ii) for Base Rate
Loans that are Revolving Credit Loans, 2.00%, (iii) for Letter
of Credit fees, 3.00% less the fronting fee payable in respect of
the applicable Letter of Credit, (iv) for commitment fees,
0.50%, (v) for Eurodollar Rate Loans that are Term Loans,
3.00% and (vi) for Base Rate Loans that are Term Loans, 2.00% and
(b) thereafter, the following percentages per annum (or, in the
case of any Letter of Credit fee, at the following percentages per
annum less the fronting fee payable in respect of the applicable
Letter of Credit), based upon the Total Leverage Ratio as set forth
in the most recent Compliance Certificate received by the
Administrative Agent pursuant to Section 6.02(b);
provided that, upon the satisfaction of the Specified
Ratings Condition (as evidenced by a certificate of a Responsible
Officer of the Company delivered to the Administrative Agent) and
for so long as the Specified Ratings Condition shall remain
satisfied, Pricing Level 2, as set forth in the following table,
shall apply at any time when Pricing Level 1, as set forth in the
following table, would otherwise apply based upon the Total
Leverage Ratio as of such date:
|
Applicable Rate
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Pricing
Level
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Total Leverage Ratio
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|
Eurodollar
Rate for
Revolving
Credit Loans
and Letter of
Credit Fees
|
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Base Rate for
Revolving
Credit Loans
|
|
Commitment
Fee Rate
|
|
Eurodollar
Rate for
Term Loans
|
|
Base Rate for
Term Loans
|
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1
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> 5.0:1.0
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3.00%
|
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2.00%
|
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0.50%
|
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3.00%
|
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2.00%
|
|
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2
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< 5.0:1.0 but
> 4.0:1.0
|
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2.75%
|
|
1.75%
|
|
0.375%
|
|
2.75%
|
|
1.75%
|
|
|
3
|
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< 4.0:1.0
|
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2.50%
|
|
1.50%
|
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0.375%
|
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2.75%
|
|
1.75%
|
|
Any increase or
decrease in the Applicable Rate resulting from a change in the
Total Leverage Ratio shall become effective as of the first
Business Day immediately following the date a Compliance
Certificate is delivered pursuant to Section 6.02(b);
provided that at the option of the Required Lenders, the
highest Pricing Level shall apply (x) as of the first Business Day
after the date on which a Compliance Certificate was required to
have been delivered but was not delivered, and shall continue to so
apply to and including the date on which such Compliance
Certificate is so delivered (and thereafter the Pricing Level
otherwise determined in accordance with this definition shall
apply) and (y) as of the first Business Day after an Event of
Default under Section 8.01(a) shall have occurred and be
continuing, and shall continue to so apply to but excluding the
date on which such Event of Default is cured or waived (and
thereafter the Pricing Level otherwise determined in accordance
with this definition shall apply). Notwithstanding anything in this
Agreement to the contrary, the Specified Ratings Condition shall in
no event be considered to be or remain satisfied after an Event of
Default shall have occurred and be continuing. If the rating system
of Moody’s or S&P shall change, or if either such rating
agency shall cease to be in the business of rating corporate debt
obligations, the Company and the Lenders shall negotiate in good
faith to amend the definition of the term
3
“Specified
Ratings Condition” to reflect such changed rating system, or
the unavailability of ratings from such rating agency and, pending
the effectiveness of any such amendment, the Applicable Rate shall
be determined without regard to whether or not the Specified
Ratings Condition shall have been satisfied.
“
Appropriate Lender ” means, at any time, (a) with
respect to Loans of any Class, the Lenders of such Class, (b) with
respect to Letters of Credit, (i) the relevant L/C Issuer and
(ii) the Revolving Credit Lenders and (c) with respect to
the Swing Line Facility, (i) the Swing Line Lender and
(ii) if any Swing Line Loans are outstanding pursuant to
Section 2.04(a), the Revolving Credit Lenders.
“
Approved Bank ” has the meaning specified in
clause (c) of the definition of “Cash
Equivalents”.
“
Approved Fund ” means, with respect to any Lender, any
Fund that is administered, advised or managed by (a) such
Lender, (b) an Affiliate of such Lender or (c) an entity or an
Affiliate of an entity that administers, advises or manages such
Lender.
“
Arrangers ” means Credit Suisse Securities (USA) LLC
and Banc of America Securities LLC, each in its capacity as a lead
arranger and book runner.
“
Assignees ” has the meaning set forth in
Section 10.07(b).
“
Assignment and Assumption ” means an Assignment and
Assumption substantially in the form of Exhibit E.
“
Attorney Costs ” means and includes all reasonable
fees, expenses and disbursements of any law firm or other external
legal counsel.
“
Attributable Indebtedness ” means, on any date, in
respect of any Capitalized Lease of any Person, the capitalized
amount thereof that would appear on a balance sheet of such Person
prepared as of such date in accordance with GAAP.
“ Audited
Financial Statements ” means the audited consolidated
balance sheets of each of the Company and its consolidated
subsidiaries and the Target and its consolidated Subsidiaries as of
each of December 31, 2006, 2005 and 2004, and the related audited
consolidated statements of operations, stockholders’ equity
and cash flows for each of the Company and its consolidated
subsidiaries and the Target and its consolidated Subsidiaries for
the fiscal years ended December 31, 2006, 2005 and 2004,
respectively.
“
Auto-Renewal Letter of Credit ” has the meaning set
forth in Section 2.03(b)(iii).
“
Available Amount ” means, at any time (the “
Reference Date ”), an amount equal to the sum of (a)
the greater of (i) Cumulative Excess Cash Flow that is Not
Otherwise Applied and (ii) the 50% of Consolidated Net Income for
the Available Amount Reference Period (or in the case such
Consolidated Net Income for such period
4
is a deficit, minus
100% of such deficit); plus (b) to the extent not (i)
already included in the calculation of Consolidated Net Income of
the Company and the Restricted Subsidiaries or (ii) already
reflected as a return of capital or deemed reduction in the amount
of such Investment pursuant to clause (e) below, the aggregate
amount of all cash dividends and other cash distributions received
by the Company or any Restricted Subsidiary from any Minority
Investments or Unrestricted Subsidiaries (to the extent such
Unrestricted Subsidiary was created after the Closing Date or
designated as an Unrestricted Subsidiary after the Closing Date in
accordance with the terms of this Agreement) during the period from
and including the Business Day immediately following the Closing
Date through and including the Reference Date; plus (c) to
the extent not (i) already included in the calculation of
Consolidated Net Income of the Company and the Restricted
Subsidiaries or (ii) already reflected as a return of capital or
deemed reduction in the amount of such Investment pursuant to
clause (e) below, the aggregate amount of all cash repayments of
principal received by the Company or any Restricted Subsidiary from
any Minority Investment or Unrestricted Subsidiary during the
period from and including the Business Day immediately following
the Closing Date through and including the Reference Date in
respect of loans or advances made by the Company or any Restricted
Subsidiary to such Minority Investments or Unrestricted
Subsidiaries (to the extent such loans or advances were made after
the Closing Date in accordance with the terms of this Agreement);
plus (d) to the extent not (i) already included in the
calculation of Consolidated Net Income of the Company and the
Restricted Subsidiaries, (ii) already reflected as a return of
capital or deemed reduction in the amount of such Investment
pursuant to clause (e) below, or (iii) are used to prepay Term
Loans in accordance with Section 2.05(b)(ii), the aggregate amount
of all Net Cash Proceeds received by the Company or any Restricted
Subsidiary in connection with the sale, transfer or other
disposition of its ownership interest in any Minority Investment or
Unrestricted Subsidiary (to the extent such Unrestricted Subsidiary
was created after the Closing Date or designated as an Unrestricted
Subsidiary after the Closing Date in accordance with the terms of
this Agreement) during the period from and including the Business
Day immediately following the Closing Date through and including
the Reference Date; minus (e) the aggregate amount of any
Investments made pursuant to clause (ii) of the second proviso to
Section 7.02(c)(ii)(A), clause (ii) of the proviso to 7.02(i)(B) or
clause (ii) of the proviso to 7.02(n) (net of any return of capital
in respect of such Investment or deemed reduction in the amount of
such Investment including, without limitation, upon the
re-designation of any Unrestricted Subsidiary as a Restricted
Subsidiary or the Disposition of any such Investment), any
Restricted Payment made pursuant to Section 7.06(h)(iii) or any
payment made pursuant to Section 7.13(a)(iv)(2)(iii) during
the period commencing on the Closing Date and ending on prior to
the Reference Date (and, for purposes of this clause (e), without
taking account of the intended usage of the Available Amount on
such Reference Date).
“
Available Amount Reference Period ” means, with
respect to any Reference Date, the period commencing at the
beginning of the fiscal quarter in which the Closing Date occurs
and ending on the last day of the most recent fiscal quarter or
fiscal year, as applicable, for which financial statements required
to be delivered pursuant to Section 6.01(a) or
Section 6.01(b), and the related Compliance Certificate
required to
5
be delivered pursuant
to Section 6.02(a), have been received by the Administrative
Agent.
“Base
Rate” means, for any day, a rate per annum equal
to the greater of (a) the Prime Rate in effect on such day and
(b) the Federal Funds Rate in effect on such day plus 1/2 of 1%. If
the Administrative Agent shall have determined (which determination
shall be conclusive absent manifest error) that it is unable to
ascertain the Federal Funds Rate for any reason, including the
inability or failure of the Administrative Agent to obtain
sufficient quotations in accordance with the terms of the
definition thereof, the Base Rate shall be determined without
regard to clause (b) of the preceding sentence until the
circumstances giving rise to such inability no longer exist. Any
change in the Base Rate due to a change in the Prime Rate or the
Federal Funds Rate shall be effective on the effective date of such
change in the Prime Rate or the Federal Funds Rate, as the case may
be.
“ Base
Rate Loan ” means a Loan that bears interest based on the
Base Rate.
“
Board ” shall mean the Board of Governors of the
Federal Reserve System of the United States of
America.
“
Borrower ” means the Company.
“
Borrowing ” means a Revolving Credit Borrowing, a
Swing Line Borrowing or a Term Borrowing, as the context may
require.
“
Business Day ” means any day other than a Saturday,
Sunday or other day on which commercial banks are authorized to
close under the Laws of, or are in fact closed in, the state where
the Administrative Agent’s Office is located and, if such day
relates to any Eurodollar Rate Loan, any such day on which dealings
in Dollar deposits are conducted by and between banks in the London
interbank eurodollar market.
“ Capital
Expenditures ” means, for any period, the aggregate of
(a) all expenditures (whether paid in cash or accrued as
liabilities) by the Company and the Restricted Subsidiaries during
such period that, in conformity with GAAP, are or are required to
be included as additions during such period to property, plant or
equipment reflected in the consolidated balance sheet of the
Company and the Restricted Subsidiaries and (b) all Capitalized
Lease Obligations incurred by the Company and the Restricted
Subsidiaries during such period and recorded on the balance sheet
as such in accordance with GAAP; provided that the term
“Capital Expenditures” shall not include
(i) expenditures made in connection with the replacement,
substitution, restoration or repair of assets to the extent
financed with (x) insurance proceeds paid on account of the loss of
or damage to the assets being replaced, restored or repaired or (y)
awards of compensation arising from the taking by eminent domain or
condemnation of the assets being replaced, (ii) the purchase
price of equipment that is purchased simultaneously with the
trade-in of existing equipment to the extent that the gross amount
of such purchase price is reduced by the credit granted by the
seller of such equipment for the equipment
6
being traded in at such
time, (iii) the purchase of plant, property or equipment to
the extent financed with the proceeds of Dispositions that are not
required to be applied to prepay Term Loans pursuant to
Section 2.05(b)(ii), (iv) expenditures that constitute
any part of Consolidated Lease Expense, (v) expenditures that
are accounted for as capital expenditures by the Company or any
Restricted Subsidiary and that actually are paid for by a Person
other than the Company or any Restricted Subsidiary and for which
neither the Company nor any Restricted Subsidiary has provided or
is required to provide or incur, directly or indirectly, any
consideration or obligation to such Person or any other Person
(whether before, during or after such period), (vi) the book
value of any asset owned by the Company or any Restricted
Subsidiary prior to or during such period to the extent that such
book value is included as a capital expenditure during such period
as a result of such Person reusing or beginning to reuse such asset
during such period without a corresponding expenditure actually
having been made in such period; provided that (x) any
expenditure necessary in order to permit such asset to be reused
shall be included as a Capital Expenditure during the period in
which such expenditure actually is made and (y) such book
value shall have been included in Capital Expenditures when such
asset was originally acquired, or (vii) expenditures that
constitute Permitted Acquisitions and expenditures made in
connection with the Transaction.
“
Capitalized Leases ” means, as applied to any Person,
all leases of property that have been or should be, in accordance
with GAAP, recorded as capitalized leases on the balance sheet
(excluding the footnotes thereto).
“ Cash
Collateral ” has the meaning specified in
Section 2.03(g).
“ Cash
Collateral Account ” means a blocked account at a
commercial bank specified by the Administrative Agent in the name
of the Administrative Agent and under the sole dominion and control
of the Administrative Agent, and otherwise established in a manner
satisfactory to the Administrative Agent.
“ Cash
Collateralize ” has the meaning specified in
Section 2.03(g).
“ Cash
Equivalents ” means any of the following types of
Investments, to the extent owned by the Company or any Restricted
Subsidiary:
(a)
Dollars, Euros or, in the case of any Foreign Subsidiary, such
local currencies held by it from time to time in the ordinary
course of business;
(b)
readily marketable obligations issued or directly and fully
guaranteed or insured by the government or any agency or
instrumentality of (i) the United States or (ii) any
member nation of the European Union, having average maturities of
not more than 12 months from the date of acquisition thereof;
provided that the full faith and credit of the
United States or a member nation of the European Union is
pledged in support thereof;
(c)
time deposits with, or insured certificates of deposit or
bankers’ acceptances of, any commercial bank that (i)
is a Lender or (ii) (A) is organized under the Laws of
the United States, any state thereof, the District of Columbia
or
7
any member nation of
the Organization for Economic Cooperation and Development or is the
principal banking Subsidiary of a bank holding company organized
under the Laws of the United States, any state thereof, the
District of Columbia or any member nation of the Organization for
Economic Cooperation and Development, and is a member of the
Federal Reserve System, and (B) has combined capital and
surplus of at least $250,000,000 (any such bank in the foregoing
clauses (i) or (ii) being an “ Approved Bank
”), in each case with average maturities of not more than 12
months from the date of acquisition thereof;
(d)
commercial paper and variable or fixed rate notes issued by an
Approved Bank (or by the parent company thereof) or any variable or
fixed rate note issued by, or guaranteed by, a corporation rated
A-2 (or the equivalent thereof) or better by S&P or P-2 (or the
equivalent thereof) or better by Moody’s, in each case with
average maturities of not more than 12 months from the date of
acquisition thereof;
(e)
repurchase agreements entered into by any Person with a bank or
trust company (including any of the Lenders) or recognized
securities dealer, in each case, having capital and surplus in
excess of $250,000,000 for direct obligations issued by or fully
guaranteed or insured by the government or any agency or
instrumentality of (i) the United States or (ii) any
member nation of the European Union, in which such Person shall
have a perfected first priority security interest (subject to no
other Liens) and having, on the date of purchase thereof, a fair
market value of at least 100% of the amount of the repurchase
obligations;
(f)
securities with average maturities of 12 months or less from the
date of acquisition issued or fully guaranteed by any state,
commonwealth or territory of the United States, by any
political subdivision or taxing authority of any such state,
commonwealth or territory or by any foreign government having an
investment grade rating from either S&P or Moody’s (or
the equivalent thereof);
(g)
Investments with average maturities of 12 months or less from the
date of acquisition in money market funds rated AAA- (or the
equivalent thereof) or better by S&P or Aaa3 (or the equivalent
thereof) or better by Moody’s;
(h)
instruments equivalent to those referred to in clauses (a) through
(g) above denominated in Euros or any other foreign currency
comparable in credit quality and tenor to those referred to above
and customarily used by corporations for cash management purposes
in any jurisdiction outside the United States to the extent
reasonably required in connection with any business conducted by
any Restricted Subsidiary organized in such jurisdiction;
and
(i)
Investments, classified in accordance with GAAP as current assets
of the Company or any Restricted Subsidiary, in money market
investment programs which are registered under the Investment
Company Act of 1940 or which are administered by financial
institutions having capital of at least $250,000,000,
and,
8
in either case, the
portfolios of which are limited such that substantially all of such
investments are of the character, quality and maturity described in
clauses (a) through (h) of this definition.
“ Cash
Management Bank ” means any Person that is an Agent, a
Lender or an Affiliate of an Agent or a Lender at the time it
provides any Cash Management Services.
“ Cash
Management Obligations ” means obligations owed by the
Company or any Restricted Subsidiary to any Agent, Lender or any
Affiliate of an Agent or a Lender in respect of any Cash Management
Services, including overdraft and related liabilities arising
therefrom.
“ Cash
Management Services ” means treasury, depository and cash
management services (including in respect of liabilities arising
from purchase cards, travel and entertainment cards or other card
services) or any automated clearing house transfers of
funds.
“
Casualty Event ” means any event that gives rise to
the receipt by the Company or any Restricted Subsidiary of any
insurance proceeds or condemnation awards in respect of any
equipment, fixed assets or real property (including any
improvements thereon) to replace or repair such equipment, fixed
assets or real property.
“
CERCLA ” means the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as subsequently
amended.
“
CERCLIS ” means the Comprehensive Environmental
Response, Compensation and Liability Information System maintained
by the U.S. Environmental Protection Agency.
“ Change
of Control ” means the earliest to occur of (a) the
Permitted Holders ceasing to have the power, directly or
indirectly, to vote or direct the voting of securities having a
majority of the ordinary voting power for the election of directors
of Holdings; provided that the occurrence of the foregoing
event shall not be deemed a Change of Control if,
(i)
any time prior to the consummation of a Qualifying IPO, and for any
reason whatsoever, (A) the Permitted Holders otherwise have
the right, directly or indirectly, to designate (and do so
designate) a majority of the board of directors of Holdings at such
time or (B) the Permitted Holders own, directly or indirectly,
of record and beneficially, a majority of the outstanding voting
Equity Interests of Holdings, or
(ii) at any time after the consummation of a
Qualifying IPO, and for any reason whatsoever, (A) no
“person” or “group” (as such terms are used
in Sections 13(d) and 14(d) of the Exchange Act, but excluding
any employee benefit plan of such person or group and its
Subsidiaries, and any Person acting in its capacity as trustee,
agent or other fiduciary or
9
administrator of any
such plan), excluding the Permitted Holders, shall become the
“beneficial owner” (as defined in Rules 13(d)-3 and
13(d)-5 under such Act), directly or indirectly, of more than the
greater of (x) thirty-five percent (35%) of the then outstanding
voting Equity Interests of Holdings and (y) the percentage of the
then outstanding voting stock of Holdings owned, directly or
indirectly, beneficially by the Permitted Holders, and
(B) during each period of twelve (12) consecutive months, the
board of directors of Holdings shall consist of a majority of the
Continuing Directors; or
(b)
any “Change of Control” (or any comparable term) in any
document pertaining to the New Notes, the Existing Notes or any
Junior Financing with an aggregate outstanding principal amount in
excess of the Threshold Amount; or
(c)
at any time prior to a Qualifying IPO of the Company, the Company
ceasing to be a directly or indirectly wholly owned Subsidiary of
(i) Holdings or (ii) if any Intermediate Holding Company
is formed, the Intermediate Holding company that is the direct
parent of the Company.
“
Class ” (a) when used with respect to Lenders, refers
to whether such Lenders are Revolving Credit Lenders or Term
Lenders, (b) when used with respect to Commitments, refers to
whether such Commitments are Revolving Credit Commitments or Term
Commitments and (c) when used with respect to Loans or a
Borrowing, refers to whether such Loans, or the Loans comprising
such Borrowing, are Revolving Credit Loans or Term
Loans.
“ Closing
Date ” means the first date all the conditions precedent
in Section 4.01 are satisfied or waived in accordance with
Section 10.01.
“
Code ” means the U.S. Internal Revenue Code of 1986,
as amended, and rules and regulations related thereto.
“
Collateral ” means all the “Collateral” as
defined in any Collateral Document and shall include the Mortgaged
Properties.
“
Collateral Agent ” means Credit Suisse, in its
capacity as collateral agent under any of the Loan Documents, or
any successor collateral agent.
“
Collateral and Guarantee Requirement ” means, at any
time, the requirement that:
(a)
the Administrative Agent shall have received each Collateral
Document required to be delivered on the Closing Date pursuant to
Section 4.01(a)(ii) or pursuant to Section 6.11 at such
time, duly executed by each Loan Party party thereto;
(b)
all Obligations shall have been unconditionally guaranteed (the
“ Guarantees ”) by Holdings (in the absence of
any Intermediate Holding
10
Company) or any
Intermediate Holding Company and each Restricted Subsidiary that is
a Domestic Subsidiary and not an Excluded Subsidiary, including
those that are listed on Schedule 1 hereto (each, a “
Guarantor ” and collectively, the “
Guarantors ”);
(c)
the Obligations and the Guarantees shall have been secured by a
first-priority security interest in (i) all the Equity
Interests of the Company and (ii) all Equity Interests (other
than Equity Interests of Unrestricted Subsidiaries and any Equity
Interest of any Restricted Subsidiary pledged to secure
Indebtedness permitted under Section 7.03(g)) of each wholly
owned Material Subsidiary directly owned by the Company or any
Guarantor; provided that pledges of Equity Interests of each
Foreign Subsidiary that is a Material Subsidiary shall be limited
to 65% of the issued and outstanding voting Equity Interests (and
100% of the issued and outstanding non-voting Equity Interests, if
any) of each wholly-owned Foreign Subsidiary that is a Material
Subsidiary and that is directly owned by the Company or any
Domestic Subsidiary of the Company that is a Guarantor;
(d)
except to the extent otherwise permitted hereunder or under any
Collateral Document, the Obligations and the Guarantees shall have
been secured by a perfected security interest (other than in the
case of mortgages, to the extent such security interest may be
perfected by delivery of certificated securities, filing UCC
financing statements or making any necessary filings with the
United States Patent and Trademark Office or United States
Copyright Office) in, and mortgages on, substantially all tangible
and intangible assets of Holdings, the Company and each other
Guarantor (including accounts (other than deposit accounts or other
bank or securities accounts), accounts receivable, inventory,
equipment, investment property, intercompany notes, contract
rights, intellectual property, other general intangibles, owned
(but not leased) real property and proceeds of the foregoing), in
each case, with the priority required by the Collateral Documents;
provided that security interests in real property shall be
limited to the Mortgaged Properties;
(e)
none of the Collateral shall be subject to any Liens other than
Liens permitted by Section 7.01; and
(f)
the Collateral Agent shall have received (i) counterparts of a
Mortgage, with respect to each owned property described on
Schedule 1.01B hereto or required to be delivered pursuant to
Section 6.11 (the “ Mortgaged Properties ”)
duly executed and delivered by the record owner of such property,
(ii) a policy or policies of title insurance issued (or
binding commitments to issue) by a nationally recognized title
insurance company insuring the Lien of each such Mortgage as a
valid Lien on the property described therein, free of any other
Liens except as expressly permitted by Section 7.01, together
with such endorsements, coinsurance and reinsurance as the
Administrative Agent may reasonably request, and (iii) to the
extent such items are in the possession of, or under the control
of, the Company, such existing surveys, existing
abstracts,
11
existing appraisals,
legal opinions and other documents as the Administrative Agent may
reasonably request with respect to any such Mortgaged
Property.
The foregoing
definition shall not require the creation or perfection of pledges
of or security interests in, or the obtaining of title insurance or
surveys with respect to, particular assets if and for so long as,
in the reasonable judgment of the Administrative Agent and the
Company, the cost of creating or perfecting such pledges or
security interests in such assets or obtaining title insurance or
surveys in respect of such assets shall be excessive in view of the
benefits to be obtained by the Lenders therefrom. The
Administrative Agent may grant extensions of time for the
perfection of security interests in or the obtaining of title
insurance and/or surveys with respect to particular assets
(including extensions beyond the Closing Date for the perfection of
security interests in the assets of the Loan Parties on such date)
where it reasonably determines, in consultation with the Company,
that perfection cannot be accomplished without undue effort or
expense by the time or times at which it would otherwise be
required by this Agreement or the Collateral Documents.
Notwithstanding
the foregoing provisions of this definition or anything in this
Agreement or any other Loan Document to the contrary, (a) with
respect to leases of real property entered into by the Company or
any other Guarantor, such Person shall not be required to take any
action with respect to the creation or perfection of security
interests with respect to such leases, (b) Liens required to be
granted from time to time pursuant to the Collateral and Guarantee
requirement shall be subject to exceptions and limitations set
forth in the Collateral Documents as in effect on the Closing Date
and, to the extent appropriate in the applicable jurisdiction, as
agreed between the Administrative Agent and the Company and
(c) the Collateral and Guarantee Requirement shall not apply
to any of the following assets: (i) any fee-owned real
property with a book value not in excess of $5,000,000 and any
leasehold interests in real property, (ii) motor vehicles and
other assets subject to certificates of title, letter of credit
rights and commercial tort claims with a book value not in excess
of $5,000,000, (iii) assets in respect of which a pledge
thereof or the granting of a security interest therein is
prohibited by applicable Law or by agreements containing
anti-assignment clauses not overridden by Uniform Commercial Code
or other applicable Law and (iv) assets (including deposit and
securities accounts) specifically requiring perfection through
control agreements.
“
Collateral Documents ” means, collectively, the
Security Agreement, the Intellectual Property Security Agreement,
the Mortgages, each of the mortgages, Security Agreement
Supplements, IP Security Agreement Supplements, security
agreements, pledge agreements or other similar agreements delivered
to the Administrative Agent and the Secured Parties pursuant to
Section 6.11 or Section 6.13, and each of the other
agreements, instruments or documents that creates or purports to
create a Lien in favor of the Collateral Agent for the benefit of
the Secured Parties.
“
Commitment ” means a Term Commitment or a Revolving
Credit Commitment, as the context may require.
12
“
Company ” has the meaning set forth in the
introductory paragraph to this Agreement.
“
Compensation Period ” has the meaning specified in
Section 2.12(c)(ii).
“
Compliance Certificate ” means a certificate
substantially in the form of Exhibit D.
“
Consolidated EBITDA ” means, for any period, the
Consolidated Net Income for such period, plus :
(a) without duplication and to the
extent already deducted (and not added back) in arriving at
such Consolidated Net Income, the sum of the following
amounts for such period:
(i)
total interest expense and, to the extent not reflected in such
total interest expense, any losses on hedging obligations or other
derivative instruments entered into for the purpose of hedging
interest rate risk, net of interest income and gains on such
hedging obligations, and costs of surety bonds in connection with
financing activities,
(ii) provision for federal, state, local,
foreign and provincial taxes based on income, profits or capital of
the Company and the Restricted Subsidiaries, including franchise,
gross receipts and similar taxes and any withholding taxes paid or
accrued during such period,
(iii) depreciation and amortization (including
amortization of deferred financing fees),
(iv) Non-Cash Charges,
(v)
extraordinary losses and unusual or non-recurring charges
(including any unusual or non-recurring operating expenses
attributable to the implementation of cost savings initiatives or
any extraordinary losses and unusual or non-recurring charges or
expenses attributable to legal and judgment settlements),
severance, relocation costs, and curtailments or modifications to
pension and post-retirement employee benefit plans,
(vi) restructuring charges, accruals or
reserves (including restructuring costs related to acquisitions
prior to or on or after the date hereof and to
closure/consolidation of facilities),
(vii) any deductions attributable to minority
interests,
(viii) the amount of (A) management and
monitoring fees and related expenses paid to the Sponsor pursuant
to the Sponsor Management Agreement dated as of the Closing Date,
and (B) other consulting and
13
advisory fees and
related expenses paid to the Sponsor to the extent permitted
hereunder,
(ix) any costs or expenses incurred by the
Company or a Restricted Subsidiary pursuant to any management
equity plan or stock option plan or any other management or
employee benefit plan or agreement or any stock subscription or
shareholder agreement, to the extent that such costs or expenses
are funded with contributions to the capital of the Company or net
cash proceeds of an issuance of Equity Interests of the Company
(other than Disqualified Equity Interests),
(x)
an amount not to exceed $10,000,000 for retention incentive
compensation paid or payable to executive officers of the Company
(or any direct or indirect parent thereof) on or prior to
December 31, 2008;
(xi) the amount of net cost savings projected
by the Company in good faith to be realized as a result of
specified actions taken or expected to be taken during or prior to
such period (which cost savings shall be added to Consolidated
EBITDA until fully realized and calculated on a pro forma basis as
though such cost savings had been realized on the first day of such
period), net of the amount of actual benefits realized during such
period from such actions; provided that (A) such cost
savings are reasonably identifiable and factually supportable,
(B) such actions were begun to have been taken or expected to
have been begun to be taken prior to the date that is eighteen
months after the Closing Date; provided that with respect to
any action expected to have begun to be taken, the underlying
action shall actually have begun to be taken prior to the date on
which a Compliance Certificate shall be required to be delivered
pursuant to Section 6.02(b) for the fiscal quarter in which
the relevant cost savings shall have been added back pursuant to
this clause (xi), (C) no cost savings shall be added pursuant
to this clause (xi) to the extent duplicative of any expenses
or charges relating to such cost savings that are included in
clause (vi) above with respect to such period, (D) the
aggregate amount of cost savings that are added back pursuant to
this clause (xi) shall include only those cost savings
expected to be realized within twelve months of taking such action
and (E) the aggregate amount of cost savings added back pursuant to
this clause (xi) shall not exceed (I) in any four consecutive
fiscal quarter period ending on or prior to September 30, 2008, the
sum of (x) $50,600,000 of cost savings relating to the categories
identified in the materials furnished to the Lenders in connection
with the syndication of the Facilities (such cost savings, the
“ Specified Cost Savings ”) and (y) $10,000,000
of additional cost savings to the extent such cost savings are
projected to be realized as a result of actions actually taken
during or prior to such period, (II) in any four consecutive fiscal
quarter period ending after September 30, 2008 and on or prior to
September 30, 2009, the sum of (x) $50,600,000 of Specified
Cost
14
Savings and (y)
$10,00,000 of additional cost savings and (III) in any four
consecutive fiscal quarter period ending thereafter,
$10,000,000.
less
(b)
without duplication and to the extent included in arriving at such
Consolidated Net Income, the sum of the following amounts for such
period:
(i)
extraordinary gains and unusual or non-recurring gains,
(ii) non-cash gains (excluding any non-cash
gain to the extent it represents the reversal of an accrual or
reserve for a potential cash item that reduced Consolidated EBITDA
in any prior period),
(iii) gains on asset sales (other than asset
sales in the ordinary course of business),
(iv) any net after-tax income from the early
extinguishment of Indebtedness or hedging obligations or other
derivative instruments, and
(v)
all gains from investments recorded using the equity
method,
in each case, as
determined on a consolidated basis for the Company and the
Restricted Subsidiaries in accordance with GAAP;
provided that, to
the extent included in Consolidated Net Income,
(i) there shall be excluded in determining
Consolidated EBITDA currency translation gains and losses related
to currency remeasurements of Indebtedness (including the net loss
or gain resulting from hedging agreements for currency exchange
risk),
(ii) there shall be excluded in
determining Consolidated EBITDA for any period any adjustments
resulting from the application of Statement of Financial Accounting
Standards No. 133, and
(c) there shall be included in
determining Consolidated EBITDA for any period, without
duplication, (A) the Acquired EBITDA of any Person, property,
business or asset acquired by the Company or any Restricted
Subsidiary during such period (but not the Acquired EBITDA of any
related Person, property, business or assets to the extent not so
acquired), to the extent not subsequently sold, transferred or
otherwise disposed by the Company or such Restricted Subsidiary
(each such Person, property, business or asset acquired and not
subsequently so disposed of, including pursuant to the Transaction,
an “ Acquired Entity or Business ”) and
the Acquired EBITDA of any Unrestricted Subsidiary that is
converted into a Restricted Subsidiary during such period (each, a
“ Converted Restricted Subsidiary ”), based on
the actual Acquired EBITDA of
15
such Acquired Entity or
Business or such Converted Restricted Subsidiary, as applicable,
for such period (including the portion thereof occurring prior to
such acquisition or conversion) and (B) for the purposes of
determining the Senior Secured Leverage Ratio, the Total Leverage
Ratio and/or Interest Coverage Ratio, an adjustment in respect of
each Acquired Entity or Business or of each Converted Restricted
Subsidiary equal to the amount of the Pro Forma Adjustment with
respect to such Acquired Entity or Business or of such Converted
Restricted Subsidiary for such period (including the portion
thereof occurring prior to such acquisition or conversion) as
specified in a certificate executed by a Responsible Officer and
delivered to the Administrative Agent and
(d)
for purposes of determining the Senior Secured Leverage Ratio, the
Total Leverage Ratio and the Interest Coverage Ratio only, there
shall be excluded in determining Consolidated EBITDA for any period
the Disposed EBITDA of any Person, property, business, product,
product line or asset sold, transferred or otherwise disposed of,
closed or classified as discontinued operations by the Company or
any Restricted Subsidiary during such period (each such Person,
property, business or asset so sold or disposed of, a “
Sold Entity or Business ”), based on the actual
Disposed EBITDA of such Sold Entity or Business for such period
(including the portion thereof occurring prior to such sale,
transfer or disposition).
For the purpose of the
definition of Consolidated EBITDA, “ Non-Cash Charges
” means (a) losses on asset sales, disposals or
abandonments, (b) any impairment charge or asset write-off related
to intangible assets, long-lived assets, and investments in debt
and equity securities pursuant to GAAP, (c) all losses from
investments recorded using the equity method, (d) stock-based
awards compensation expense, and (e) other non-cash charges (
provided that if any non-cash charges referred to in this
clause (e) represent an accrual or reserve for potential cash
items in any future period, the cash payment in respect thereof in
such future period shall be subtracted from Consolidated EBITDA to
such extent, and excluding amortization of a prepaid cash item that
was paid in a prior period).
“
Consolidated Interest Expense ” means, for any period,
the sum of (i) the cash interest expense (including that
attributable to Capitalized Lease Obligations), net of cash
interest income, of the Company and the Restricted Subsidiaries,
determined on a consolidated basis in accordance with GAAP, with
respect to all outstanding Indebtedness of the Company and the
Restricted Subsidiaries, including all commissions, discounts and
other fees and charges owed with respect to letters of credit and
bankers’ acceptance financing and net costs under hedging
agreements, (ii) any cash payments made during such period in
respect of obligations referred to in clause (b) below
relating to Funded Debt that were amortized or accrued in a
previous period (other than any such obligations resulting from the
discounting of Indebtedness in connection with the application of
purchase accounting in connection with the Transaction or any
Permitted Acquisition), and (iii) the aggregate amount of all
Restricted Payments made during such period pursuant to Section
7.06(i) (net of cash interest income of Holdings, to the extent
such cash has been contributed to the Company), but excluding,
however, (a) amortization of deferred financing costs debt
issuance costs, commissions, fees and
16
expenses and any other
amounts of non-cash interest, (b) the accretion or accrual of
discounted liabilities during such period, (c) non-cash
interest expense attributable to the movement of the mark-to-market
valuation of obligations under hedging agreements or other
derivative instruments pursuant to Statement of Financial
Accounting Standards No. 133, (d) any one-time cash costs
associated with breakage in respect of hedging agreements for
interest rates, and (e) all non-recurring cash interest
expense consisting of liquidated damages for failure to timely
comply with registration rights obligations and financing fees, all
as calculated on a consolidated basis in accordance with
GAAP.
For purposes of this
definition, interest on a Capitalized Lease shall be deemed to
accrue at an interest rate reasonably determined by the Company to
be the rate of interest implicit in such Capitalized Lease in
accordance with GAAP.
“
Consolidated Lease Expense ” means, for any period,
all rental expenses of the Company and the Restricted Subsidiaries
during such period under operating leases for real or personal
property (including in connection with sale-leaseback transactions
permitted by Section 7.05(f)), excluding real estate taxes,
insurance costs and common area maintenance charges and net of
sublease income, other than (a) obligations under vehicle
leases entered into in the ordinary course of business, (b) all
such rental expenses associated with assets acquired pursuant to
the Transaction and pursuant to a Permitted Acquisition to the
extent such rental expenses relate to operating leases in effect at
the time of (and immediately prior to) such acquisition and related
to periods prior to such acquisition and (c) all Capitalized
Lease Obligations, all as determined on a consolidated basis in
accordance with GAAP.
“
Consolidated Net Income ” means, for any period, the
net income (loss) of the Company and the Restricted Subsidiaries
for such period determined on a consolidated basis in accordance
with GAAP, excluding, without duplication, (a) extraordinary
items for such period, (b) the cumulative effect of a change in
accounting principles during such period to the extent included in
Consolidated Net Income, (c) Transaction Expenses,
(d) any fees, expenses, (including pre-transaction payments or
other compensation made to employees of an acquired business)
incurred during such period, or any amortization thereof for such
period, in connection with any acquisition, investment, asset
disposition, issuance or repayment of debt, issuance of equity
securities, refinancing transaction or amendment or other
modification of any debt instrument (in each case, including,
without limitation, any such transaction consummated prior to the
Closing Date, on or after the Closing Date and any such transaction
undertaken but not completed) and any charges or non-recurring
merger costs incurred during such period as a result of any such
transaction, (e) any income (loss) for such period
attributable to the early extinguishment of Indebtedness, hedging
agreements or other derivative transactions and (f) accruals
and reserves that are recorded within twelve months after the
closing date of any acquisition (including the Transaction) that
are so required to be recorded as a result of the transaction in
accordance with GAAP. There shall be excluded from
Consolidated Net Income for any period the purchase accounting
effects of adjustments to property and equipment, software,
inventory, in-process research and development, and other
intangible assets and deferred revenue in component amounts
required or permitted by GAAP and related authoritative
17
pronouncements
(including the effects of such adjustments pushed down to the
Company and the Restricted Subsidiaries), as a result of the
Transaction, any acquisition consummated prior to the Closing Date,
any Permitted Acquisitions, or the amortization or write-off of any
amounts thereof.
“
Consolidated Senior Secured Debt ” means, as of any
date of determination, (a) the aggregate principal amount of
Indebtedness of the Company and the Restricted Subsidiaries
outstanding on such date, determined on a consolidated basis in
accordance with GAAP (but excluding the effects of any discounting
of Indebtedness resulting from the application of purchase
accounting in connection with the Transaction or any Permitted
Acquisition), consisting of (i) Loans and Unreimbursed Amounts
hereunder, (ii) any Indebtedness incurred pursuant to Section
7.03(e) and secured pursuant to Section 7.01(i) and
(iii) any other Indebtedness for borrowed money or debt
obligations evidenced by promissory notes or similar instruments
that are secured by a Lien, minus (b) the excess of (but in
any event not less than zero) the aggregate amount of all cash and
Cash Equivalents (in each case, free and clear of all Liens, other
than nonconsensual Liens permitted by Section 7.01 and Liens
permitted by Section 7.01(r) and clauses (i) and (ii) of Section
7.01(s)) included, but not listed as restricted cash, in the
consolidated balance sheet of the Company and the Restricted
Subsidiaries over the Integration Reserve Amount as of such date;
provided that Consolidated Senior Secured Debt shall not
include obligations under Swap Contracts entered into in the
ordinary course of business and not for speculative
purposes.
“
Consolidated Total Debt ” means, as of any date of
determination, (a) the aggregate principal amount of
indebtedness of the Company and the Restricted Subsidiaries
outstanding on such date, determined on a consolidated basis in
accordance with GAAP (but excluding the effects of any discounting
of indebtedness resulting from the application of purchase
accounting in connection with the Transaction or any Permitted
Acquisition), consisting of indebtedness for borrowed money,
Capitalized Lease Obligations and debt obligations evidenced by
promissory notes or similar instruments, minus (b)
the excess of (but in any event not less than zero) the aggregate
amount of all cash and Cash Equivalents (in each case, free and
clear of all Liens, other than nonconsensual Liens permitted by
Section 7.01 and Liens permitted by Section 7.01(a),
Section 7.01(r) and clauses (i) and (ii) of
Section 7.01(s)) included, but not listed as restricted cash,
in the consolidated balance sheet of the Company and the Restricted
Subsidiaries over the Integration Reserve Amount as of such date;
provided that Consolidated Total Debt shall not include
(i) any Letters of Credit, except to the extent of
Unreimbursed Amounts thereunder and (ii) obligations under
Swap Contracts entered into in the ordinary course of business and
not for speculative purposes.
“
Consolidated Working Capital ” means, at any date, the
excess of (a) the sum of all amounts (other than cash and Cash
Equivalents) that would, in conformity with GAAP, be set forth
opposite the caption “total current assets” (or any
like caption) on a consolidated balance sheet of the Company and
the Restricted Subsidiaries at such date over (b) the sum of all
amounts that would, in conformity with GAAP, be set forth opposite
the caption “total current liabilities” (or any like
caption) on a consolidated balance sheet of the Company and the
Restricted Subsidiaries on such
18
date, including
deferred revenue but excluding, without duplication, (i) the
current portion of any Funded Debt, (ii) all Indebtedness
consisting of Loans and obligations in respect of Letters of Credit
to the extent otherwise included therein, (iii) the current
portion of interest and (iv) the current portion of current
and deferred income taxes.
“
Continuing Directors ” means the directors of Holdings
on the Closing Date, as elected or appointed after giving effect to
the Merger and the other transactions contemplated hereby, and each
other director, if, in each case, such other directors’
nomination for election to the board of directors of Holdings (or
any direct or indirect parent of the Company after a Qualifying IPO
of such direct or indirect parent) is recommended by a majority of
the then Continuing Directors or such other director receives the
vote of the Permitted Holders in his or her election by the
stockholders of Holdings (or any direct or indirect parent of the
Company after a Qualifying IPO of such direct or indirect
parent).
“
Contract Consideration ” has the meaning set forth in
the definition of “Excess Cash Flow”.
“
Contractual Obligation ” means, as to any Person, any
provision of any security issued by such Person or of any
agreement, instrument or other undertaking to which such Person is
a party or by which it or any of its property is bound.
“
Control ” has the meaning specified in the definition
of “Affiliate.”
“
Converted Restricted Subsidiary ” has the meaning set
forth in the definition of a “Consolidated
EBITDA”.
“ Credit
Extension ” means each of the following: (a) a
Borrowing and (b) an L/C Credit Extension.
“
Cumulative Excess Cash Flow ” means the sum of Excess
Cash Flow (but not less than zero for any period) for the fiscal
year ending on December 31, 2008 and Excess Cash Flow for each
succeeding and completed fiscal year (it being understood that no
Excess Cash Flow generated during any period shall be deemed to be
Cumulative Excess Cash Flow until the financial statements for such
period are delivered pursuant to Section 6.01(a) and the related
Compliance Certificate is delivered pursuant to Section
6.02(b)).
“ Debt
Issuance ” means the issuance by any Person and its
Subsidiaries of any Indebtedness for borrowed money.
“ Debt
Prepayment ” means the prepayment by the Company or one
of its Subsidiaries on the Closing Date of any Indebtedness
outstanding under each of the Existing Credit
Agreements.
“ Debtor
Relief Laws ” means the Bankruptcy Code of the
United States, and all other liquidation, conservatorship,
bankruptcy, assignment for the benefit of creditors, moratorium,
rearrangement, receivership, insolvency, reorganization, or
similar
19
debtor relief Laws of
the United States or other applicable jurisdictions from time
to time in effect and affecting the rights of creditors
generally.
“
Default ” means any event or condition that
constitutes an Event of Default or that, with the giving of any
notice, the passage of time, or both, would be an Event of
Default.
“ Default
Rate ” means an interest rate equal to (a) the Base
Rate plus (b) the Applicable Rate, if any, applicable to Base
Rate Loans plus (c) 2.0% per annum; provided that with
respect to a Eurodollar Rate Loan or a Letter of Credit fee, the
Default Rate shall be an interest rate equal to the interest rate
(including any Applicable Rate) otherwise applicable to such Loan
or Letter of Credit, as the case may be, plus 2.0% per annum, in
each case, to the fullest extent permitted by applicable
Laws.
“
Defaulting Lender ” means any Lender that (a) has
failed to fund any portion of the Term Loans, Revolving Credit
Loans, participations in L/C Obligations or participations in Swing
Line Loans required to be funded by it hereunder within one (1)
Business Day of the date required to be funded by it hereunder,
unless the subject of a good faith dispute or subsequently cured,
(b) has otherwise failed to pay over to the Administrative Agent or
any other Lender any other amount required to be paid by it
hereunder within one (1) Business Day of the date when due, unless
the subject of a good faith dispute or subsequently cured, or
(c) has been deemed insolvent or become the subject of a
bankruptcy or insolvency proceeding.
“
Designated Non-Cash Consideration ” means the fair
market value of non-cash consideration received by the Company or a
Restricted Subsidiary in connection with a Disposition pursuant to
Section 7.05(k) that is designated as Designated Non-Cash
Consideration pursuant to a certificate of a Responsible Officer,
setting forth the basis of such valuation (which amount will be
reduced by the fair market value of the portion of the non-cash
consideration converted to cash or Cash Equivalents within 180 days
following the consummation of the applicable
Disposition).
“
Disposed EBITDA ” means, with respect to any Sold
Entity or Business for any period, the amount for such period of
Consolidated EBITDA of such Sold Entity or Business (determined as
if references to the Company and the Restricted Subsidiaries in the
definition of Consolidated EBITDA (and in the component definitions
used therein) were references to such Sold Entity or Business and
its Subsidiaries), all as determined on a consolidated basis for
such Sold Entity or Business.
“
Disposition ” or “ Dispose ” means
the sale, transfer, license, lease or other disposition (including
any sale and leaseback transaction) of any property or the sale or
disposition of Equity Interests by any Person, including any sale,
assignment, transfer or other disposal, with or without recourse,
of any notes or accounts receivable or any rights and claims
associated therewith; provided that
“disposition” and “dispose” shall not be
deemed to include any issuance by the Company of any of its Equity
Interests to another Person.
20
“
Disqualified Equity Interests ” means any Equity
Interest which, by its terms (or by the terms of any security or
other Equity Interests into which it is convertible or for which it
is exchangeable), or upon the happening of any event or condition
(a) matures or is mandatorily redeemable (other than solely
for Qualified Equity Interests and other than as a result of a
change of control or asset sale event), pursuant to a sinking fund
obligation or otherwise (except as a result of a change of control
or asset sale so long as any rights of the holders thereof upon the
occurrence of a change of control or asset sale event shall be
subject to the prior repayment in full of the Loans and all other
Obligations that are accrued and payable and the termination of the
Commitments), (b) is redeemable at the option of the holder thereof
(other than solely for Qualified Equity Interests and other than as
a result of a change of control or asset sale so long as any rights
of the holders thereof upon the occurrence of a change of control
or asset sale event shall be subject to the prior repayment in full
of the Loans and all other Obligations that are accrued and payable
and the termination of the Commitments), in whole or in part,
(c) provides for the scheduled payments of dividends in cash,
or (d) is or becomes convertible into or exchangeable for
Indebtedness or any other Equity Interests that would constitute
Disqualified Equity Interests, in each case, prior to the date that
is ninety-one (91) days after the Maturity Date of the Term
Loans.
“
Dollar ” and “ $ ” mean lawful
money of the United States.
“
Domestic Subsidiary ” means any Subsidiary that is
organized under the Laws of the United States, any state
thereof or the District of Columbia.
“
Eligible Assignee ” means any Assignee that is a
Person (but not any natural person) and an “accredited
investor” (as defined in Regulation D under the Securities
Act of 1933, as amended) permitted by and consented to in
accordance with Section 10.07(b).
“ EMU
Legislation ” means the legislative measures of the
European Council for the introduction of, changeover to or
operation of a single or unified European currency.
“
Environmental Laws ” means any and all Federal, state,
local, and foreign statutes, Laws, regulations, ordinances, rules,
judgments, orders, decrees, permits, concessions, grants,
franchises, licenses, agreements or governmental restrictions
relating to pollution, the protection of the environment, natural
resources, or, to the extent relating to exposure to Hazardous
Materials, human health or to the release of any materials into the
environment, including those related to hazardous substances or
wastes, air emissions and discharges to waste or public
systems.
“
Environmental Liability ” means any liability,
contingent or otherwise (including any liability for damages, costs
of environmental remediation, fines, penalties or indemnities), of
the Company, any other Loan Party or any of their respective
Subsidiaries directly or indirectly resulting from or based upon
(a) violation of any Environmental Law, (b) the generation,
use, handling, transportation, storage, treatment or disposal of
any Hazardous Materials, (c) exposure to any Hazardous
Materials, (d) the
21
release or threatened
release of any Hazardous Materials into the environment or
(e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to
any of the foregoing.
“
Environmental Permit ” means any permit, approval,
identification number, license or other authorization required
under any Environmental Law.
“ Equity
Contribution ” means, collectively, the contribution,
directly or indirectly, by the Equity Investors of an aggregate
amount of cash, together with existing equity already contributed
by the Equity Investors in the Parent prior to the Closing Date,
that collectively represents not less than 25% of the aggregate pro
forma capitalization of the Parent on the Closing Date to the
Parent or one or more direct or indirect holding company parents of
the Parent, and (b) the further contribution through the Company to
the Merger Sub of any portion of such new cash contribution
proceeds not directly received by the Company or used by the Parent
or such parent to finance the Merger Costs (it being understood
that portions of the new cash contribution from the Company to the
Merger Sub may be made in the form of subordinated debt in return
for an intercompany note issued to the Company by the surviving
company of the Merger).
“ Equity
Interests ” means, with respect to any Person, all of the
shares, interests, rights, participations or other equivalents
(however designated) of capital stock of (or other ownership or
profit interests or units in) such Person and all of the warrants,
options or other rights for the purchase, acquisition or exchange
from such Person of any of the foregoing (including through
convertible securities).
“ Equity
Investors ” means the Sponsor and the Management
Stockholders.
“
ERISA ” means the Employee Retirement Income Security
Act of 1974, as amended from time to time.
“ ERISA
Affiliate ” means any trade or business (whether or not
incorporated) that is under common control with any Loan Party
within the meaning of Section 414 of the Code or
Section 4001 of ERISA.
“ ERISA
Event ” means (a) a Reportable Event with respect to
a Pension Plan; (b) a withdrawal by any Loan Party or any ERISA
Affiliate from a Pension Plan subject to Section 4063 of ERISA
during a plan year in which it was a substantial employer (as
defined in Section 4001(a)(2) of ERISA) or a cessation of
operations that is treated as such a withdrawal under
Section 4062(e) of ERISA; (c) a complete or partial
withdrawal by any Loan Party or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is in
reorganization; (d) the filing of a notice of intent to
terminate, the treatment of a Plan amendment as a termination under
Sections 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or
Multiemployer Plan; (e) an event or condition which
constitutes grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any
Pension Plan or Multiemployer Plan; or
22
(f) the imposition
of any liability under Title IV of ERISA, other than for PBGC
premiums due but not delinquent under Section 4007 of ERISA,
upon any Loan Party or any ERISA Affiliate.
“
Euro ” and “ EUR ” means the lawful
currency of the Participating Member States introduced in
accordance with EMU Legislation.
“
Eurodollar Rate ” means, for any Interest Period with
respect to any Eurodollar Rate Loan, an interest rate per annum
equal to the product of (a) the LIBO Rate in effect for such
Interest Period and (b) Statutory Reserves.
“
Eurodollar Rate Loan ” means a Loan that bears
interest at a rate based on the Eurodollar Rate.
“ Event
of Default ” has the meaning specified in
Section 8.01.
“ Excess
Cash Flow ” means, for any period, an amount equal to the
excess of:
(a)
the sum, without duplication, of:
(i)
Consolidated Net Income for such period,
(ii) an amount equal to the amount of all
non-cash charges to the extent deducted in arriving at such
Consolidated Net Income,
(iii) decreases in Consolidated Working Capital
and long-term account receivables and increases in the long-term
portion of deferred revenue for such period (other than any such
decreases or increases arising from acquisitions or dispositions of
property by the Company and the Restricted Subsidiaries completed
during such period), and
(iv) an amount equal to the aggregate
net non-cash loss on dispositions of property by the Company and
the Restricted Subsidiaries during such period (other than
dispositions of property in the ordinary course of business) to the
extent deducted in arriving at such Consolidated Net Income;
over
(b)
the sum, without duplication, of:
(i)
an amount equal to the amount of all non-cash credits included in
arriving at such Consolidated Net Income and cash charges included
in clauses (a) through (f) of the definition of Consolidated
Net Income,
(ii) without duplication of amounts deducted
pursuant to clause (xi) below in prior fiscal years, the
amount of Capital Expenditures made in cash or accrued during such
period, except to the extent that such Capital
23
Expenditures were
financed with the proceeds of Indebtedness of the Company or the
Restricted Subsidiaries,
(iii) the aggregate amount of all principal
payments of Indebtedness of the Company and the Restricted
Subsidiaries (including (A) the principal component of
payments in respect of Capitalized Lease Obligations and
(B) the amount of any mandatory prepayment of Term Loans
pursuant to Section 2.05(b)(ii) to the extent required due to
a disposition of property that resulted in an increase to
Consolidated Net Income and not in excess of the amount of such
increase but excluding (X) all other prepayments of Term Loans and
(Y) all prepayments of Revolving Credit Loans and Swing Line Loans)
made during such period (other than in respect of any revolving
credit facility to the extent there is not an equivalent permanent
reduction in commitments thereunder), except to the extent financed
with the proceeds of other Indebtedness of the Company or the
Restricted Subsidiaries,
(iv) an amount equal to the aggregate net
non-cash gain on dispositions of property by the Company and the
Restricted Subsidiaries during such period (other than dispositions
of property in the ordinary course of business) to the extent
included in arriving at such Consolidated Net Income,
(v)
increases in Consolidated Working Capital and long-term account
receivables and decreases in long-term portion of deferred revenue
for such period (other than any such increases arising from
acquisitions or dispositions of property by the Company and the
Restricted Subsidiaries during such period),
(vi) cash payments by the Company and the
Restricted Subsidiaries during such period in respect of long-term
liabilities of the Company and the Restricted Subsidiaries other
than Indebtedness,
(vii) without duplication of amounts deducted
pursuant to clause (xi) below in prior fiscal years, the
amount of Investments and acquisitions made during such period to
the extent that such Investments and acquisitions were financed
with internally generated cash flow of the Company and the
Restricted Subsidiaries,
(viii) the amount of Restricted Payments paid
during such period to the extent such Restricted Payments were
financed with internally generated cash flow of the Company and the
Restricted Subsidiaries,
(ix) the aggregate amount of expenditures
actually made by the Company and the Restricted Subsidiaries in
cash during such period (including expenditures for the payment of
financing fees) to the extent that such expenditures are not
expensed during such period,
24
(x)
the aggregate amount of any premium, make-whole or penalty payments
actually paid in cash by the Company and the Restricted
Subsidiaries during such period that are required to be made in
connection with any prepayment of Indebtedness,
(xi) without duplication of amounts deducted
from Excess Cash Flow in prior periods, the aggregate consideration
required to be paid in cash by the Company or any of the Restricted
Subsidiaries pursuant to binding contracts (the “ Contract
Consideration ”) entered into prior to or during such
period relating to Permitted Acquisitions or Capital Expenditures
to be consummated or made during the period of four consecutive
fiscal quarters of the Company following the end of such period;
provided that to the extent the aggregate amount of
internally generated cash actually utilized to finance such
Permitted Acquisitions or Capital Expenditures during such period
of four consecutive fiscal quarters is less than the Contract
Consideration, the amount of such shortfall shall be added to the
calculation of Excess Cash Flow at the end of such period of four
consecutive fiscal quarters, and
(xii) the amount of cash taxes or tax
distributions paid in such period to the extent they exceed the
amount of tax expense deducted in determining Consolidated Net
Income for such period.
“
Exchange Act ” means the Securities Exchange Act of
1934, as amended.
“
Exchange Rate ” means on any day with respect to any
currency other than Dollars, the rate at which such currency may be
exchanged into Dollars, as set forth at approximately 11:00 a.m.
(London time) on such day on the Reuters World Currency Page for
such currency; in the event that such rate does not appear on any
Reuters World Currency Page, the Exchange Rate shall be determined
by reference to such other publicly available service for
displaying exchange rates as may be agreed upon by the
Administrative Agent and the Company, or, in the absence of such
agreement, such Exchange Rate shall instead be the arithmetic
average of the spot rates of exchange of the Administrative Agent
in the market where its foreign currency exchange operations in
respect of such currency are then being conducted, at or about
10:00 a.m. (New York City time) on such date for the purchase
of Dollars for delivery two Business Days later.
“
Excluded Subsidiary ” means (a) any Subsidiary
that is not a wholly owned Subsidiary, (b) each Subsidiary
listed on Schedule 1.01C hereto, (c) any Subsidiary that
is prohibited by applicable Law from guaranteeing the Obligations,
(d) any Domestic Subsidiary that is a Subsidiary of a Foreign
Subsidiary, (e) any Restricted Subsidiary acquired pursuant to
a Permitted Acquisition financed with secured Indebtedness incurred
pursuant to Section 7.03(g) and each Restricted Subsidiary
thereof that guarantees such Indebtedness; provided that
each such Restricted Subsidiary shall cease to be an Excluded
Subsidiary under this clause (e) if such secured Indebtedness
is repaid or becomes unsecured or if such Restricted Subsidiary
ceases to guarantee such secured Indebtedness, as applicable, (f)
any Subsidiary that is not a Material Subsidiary,
25
(g) any other
Subsidiary with respect to which, in the reasonable judgment of the
Administrative Agent (confirmed in writing by notice to the
Company), the cost or other consequences (including any adverse tax
consequences) of providing a Guarantee shall be excessive in view
of the benefits to be obtained by the Secured Parties therefrom,
(h) any Subsidiary with respect to which providing a guarantee
would cause an investment in United States property under Section
956 of the Code, (i) each Unrestricted Subsidiary and
(j) each Foreign Subsidiary.
“
Existing Company Credit Agreement ” means the Credit
Agreement dated as of November 3, 2006, among the Company,
Holdings, Bank of America, N.A., as administrative agent, swing
line lender and letter of credit issuer, the lenders party thereto,
and the other parties thereto.
“
Existing Credit Agreements ” means, collectively, the
Existing Target Credit Agreement and the Existing Company Credit
Agreement.
“
Existing Letters of Credit ” means the letters of
credit outstanding on the Closing Date and set forth on Schedule
1.01E.
“
Existing Notes ” means the $200,000,000 in aggregate
principal amount of the Company’s 11.75% senior subordinated
notes due 2014.
“
Existing Notes Documentation ” means the Existing
Notes, the Existing Notes Indenture and all other documents
executed and delivered with respect to the Existing
Notes.
“
Existing Notes Indenture ” means the Indenture for the
Existing Notes, dated as of November 3, 2006.
“
Existing Target Credit Agreement ” means the Credit
Agreement dated as of April 7, 2006, among DJ Orthopedics, LLC, DJ
Orthopedics Inc., Wachovia Bank, National Association, as
administrative agent and the lenders and other parties party
thereto.
“
Facility ” means the Term Loans, the Revolving Credit
Facility, the Swing Line Sublimit or the Letter of Credit Sublimit,
as the context may require.
“ Federal
Funds Rate ” means, for any day, the weighted average of
the rates on overnight Federal funds transactions with members of
the Federal Reserve System arranged by Federal funds brokers, as
published on the next succeeding Business Day by the Federal
Reserve Bank of New York, or, if such rate is not so published for
any day that is a Business Day, the average of the quotations for
the day for such transactions received by the Administrative Agent
from three Federal funds brokers of recognized standing selected by
it.
“ Fee
Letter ” means the Administrative Agent Fee Letter dated
November 20, 2007 between the Company and the Administrative
Agent.
26
“ Foreign
Casualty Event ” has the meaning specified in
Section 2.05(b).
“ Foreign
Disposition ” has the meaning specified in
Section 2.05(b).
“ Foreign
Lender ” has the meaning specified in
Section 10.15(a)(i).
“ Foreign
Subsidiary ” means any direct or indirect Restricted
Subsidiary of the Company which (a) is not a Domestic
Subsidiary or (b) is set forth on
Schedule 1.01D.
“ Foreign
Subsidiary Total Assets ” means the total assets of the
Foreign Subsidiaries, as determined in accordance with GAAP in good
faith by a Responsible Officer, without intercompany
eliminations.
“ FRB
” means the Board of Governors of the Federal Reserve System
of the United States.
“
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.
“ Funded
Debt ” means all indebtedness of any Person for borrowed
money that matures more than one year from the date of its creation
or matures within one year from such date that is renewable or
extendable, at the option of such Person, to a date more than one
year from such date or arises under a revolving credit or similar
agreement that obligates the lender or lenders to extend credit
during a period of more than one year from such date, including
Indebtedness in respect of the Loans.
“
GAAP ” means generally accepted accounting principles
in the United States of America, as in effect from time to
time; provided, however , that if the Company notifies the
Administrative Agent that the Company requests an amendment to any
provision hereof to eliminate the effect of any change occurring
after the Closing Date in GAAP or in the application thereof on the
operation of such provision (or if the Administrative Agent
notifies the Company that the Required Lenders request an amendment
to any provision hereof for such purpose), regardless of whether
any such notice is given before or after such change in GAAP or in
the application thereof, then such provision shall be interpreted
on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall
have been withdrawn or such provision amended in accordance
herewith.
“
Governmental Authority ” means any nation or
government, any state or other political subdivision thereof, any
agency, authority, instrumentality, regulatory body, court,
administrative tribunal, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to
government.
“
Granting Lender ” has the meaning specified in
Section 10.07(i).
27
“
Guarantees ” has the meaning specified in the
definition of “Collateral and Guarantee
Requirement”.
“
Guarantee Obligations ” means, as to any Person,
without duplication, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other monetary
obligation payable by another Person (the “primary
obligor”) in any manner, whether directly or indirectly, and
including any obligation of such Person, direct or indirect,
(i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or other monetary
obligation, (ii) to purchase or lease property, securities or
services for the purpose of assuring the obligee in respect of such
Indebtedness or other monetary obligation of the ability of the
primary obligor to make payment of such Indebtedness or other
monetary obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or
level of income or cash flow of the primary obligor so as to enable
the primary obligor to pay such Indebtedness or other monetary
obligation, or (iv) entered into for the purpose of assuring
in any other manner the obligee in respect of such Indebtedness or
other monetary obligation of the ability of the primary obligor to
make payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part), or (b) any Lien on any
assets of such Person securing any Indebtedness or other monetary
obligation of any other Person, whether or not such Indebtedness or
other monetary obligation is assumed by such Person (or any right,
contingent or otherwise, of any holder of such Indebtedness to
obtain any such Lien); provided that the term
“Guarantee Obligation” shall not include endorsements
for collection or deposit, in either case in the ordinary course of
business, or customary and reasonable indemnity obligations in
effect on the Closing Date or entered into in connection with any
acquisition or Disposition of assets permitted under this Agreement
(other than such obligations with respect to Indebtedness).
The amount of any Guarantee Obligation shall be deemed to be an
amount equal to the stated or determinable amount of the related
primary obligation, or portion thereof, in respect of which such
Guarantee Obligation is made or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof as
determined by the guaranteeing Person in good faith.
“
Guarantors ” has the meaning set forth in the
definition of “Collateral and Guarantee
Requirement”.
“
Guaranty ” means, collectively, (a) the Guaranty
made by the Guarantors in favor of the Collateral Agent on behalf
of the Secured Parties, substantially in the form of Exhibit F
and (b) each other guaranty and guaranty supplement delivered
pursuant to Section 6.11.
“
Hazardous Materials ” means all explosive or
radioactive substances or wastes and all hazardous or toxic
substances, wastes or pollutants, including petroleum or petroleum
distillates, asbestos or asbestos-containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant
to any Environmental Law.
28
“ Hedge
Bank ” means any Person that is an Agent, a Lender or an
Affiliate of an Agent or a Lender at the time it enters into a
Secured Hedge Agreement, in its capacity as a party
thereto.
“
Holdings ” has the meaning set forth in the
introductory paragraph to this Agreement.
“ Honor
Date ” has the meaning specified in
Section 2.03(c)(i).
“
Incremental Amendment ” has the meaning set forth in
Section 2.14(a).
“
Incremental Facility Closing Date ” has the meaning
set forth in Section 2.14(a).
“
Incremental Term Loans ” has the meaning set forth in
Section 2.14(a).
“
Indebtedness ” means, as to any Person at a particular
time, without duplication, all of the following, whether or not
included as indebtedness or liabilities in accordance with
GAAP:
(a)
all indebtedness of such Person for borrowed money and all
indebtedness of such Person evidenced by bonds, debentures, notes,
loan agreements or other similar instruments;
(b)
the maximum amount (after giving effect to any prior drawings or
reductions which may have been reimbursed) of all letters of credit
(including standby and commercial), bankers’ acceptances,
bank guaranties, surety bonds, performance bonds and similar
instruments issued or created by or for the account of such
Person;
(c)
net obligations of such Person under any Swap Contract;
(d)
all obligations of such Person to pay the deferred purchase price
of property or services (other than (i) trade accounts payable
in the ordinary course of business and (ii) any earn-out
obligation until such obligation becomes a liability on the balance
sheet of such Person in accordance with GAAP);
(e)
indebtedness (excluding prepaid interest thereon) secured by a Lien
on property owned or being purchased by such Person (including
indebtedness arising under conditional sales or other title
retention agreements and mortgage, industrial revenue bond,
industrial development bond and similar financings), whether or not
such indebtedness shall have been assumed by such Person or is
limited in recourse;
(f)
all Attributable Indebtedness;
(g)
all obligations of such Person in respect of Disqualified Equity
Interests; and
29
(h)
all Guarantee Obligations of such Person in respect of any of the
foregoing.
For all purposes
hereof, the Indebtedness of any Person shall (A) include the
Indebtedness of any partnership or joint venture (other than a
joint venture that is itself a corporation or limited liability
company) in which such Person is a general partner or a joint
venturer, except to the extent such Person’s liability for
such Indebtedness is otherwise expressly limited and only to the
extent such Indebtedness would be included in the calculation of
Consolidated Total Debt or Consolidated Senior Secured Debt and
(B) in the case of the Company and its Subsidiaries, exclude
all intercompany Indebtedness having a term not exceeding 364 days
(inclusive of any roll-over or extensions of terms) and made in the
ordinary course of business consistent with past practice.
The amount of any net obligation under any hedging agreement on any
date shall be deemed to be the Swap Termination Value thereof as of
such date. The amount of Indebtedness of any Person for
purposes of clause (e) shall be deemed to be equal to the
lesser of (i) the aggregate unpaid amount of such Indebtedness and
(ii) the fair market value of the property encumbered thereby
as determined by such Person in good faith.
“
Indemnified Liabilities ” has the meaning set forth in
Section 10.05.
“
Indemnitees ” has the meaning set forth in
Section 10.05.
“
Information ” has the meaning specified in
Section 10.08.
“
Integration Reserve Amount ” means, for the period
prior to the time the Company first delivers a Compliance
Certificate to the Administrative Agent pursuant to Section
6.02(b), 100% of the Post-Closing Integration Amount (but in any
event not in excess of $33,000,000), and on the last day of each
fiscal quarter of the Company ending thereafter, the amount of the
Post-Closing Integration Amount on such date not expended by the
Company in connection with the Specified Post-Closing Integration
Costs and set forth in the most recent Compliance Certificate
received by the Administrative Agent pursuant to
Section 6.02(b) (but in any event not in excess of
$33,000,000).
“
Intellectual Property Security Agreement ” means,
collectively, the Intellectual Property Security Agreement,
executed by the Loan Parties substantially in the form of
Exhibit G-2, together with each other intellectual property
security agreement executed and delivered pursuant to
Section 6.11.
“
Interest Coverage Ratio ” means, with respect to the
Company and the Restricted Subsidiaries on a consolidated basis, as
of the end of any fiscal quarter of the Company for the Test Period
ending on such date, the ratio of (a) Consolidated EBITDA to
(b) Consolidated Interest Expense.
“
Interest Payment Date ” means, (a) as to any Loan
other than a Base Rate Loan, the last day of each Interest Period
applicable to such Loan and the Maturity Date of the Facility under
which such Loan was made; provided that if any Interest
Period for a Eurodollar Rate Loan exceeds three months, the
respective dates that fall
30
every three months
after the beginning of such Interest Period shall also be Interest
Payment Dates; and (b) as to any Base Rate Loan (including a
Swing Line Loan), the last Business Day of each March, June,
September and December and the Maturity Date of the Facility under
which such Loan was made.
“
Interest Period ” means, as to each Eurodollar Rate
Loan, the period commencing on the date such Eurodollar Rate Loan
is disbursed or converted to or continued as a Eurodollar Rate Loan
and ending on the date one, two, three or six months thereafter, or
to the extent available to each Lender of such Eurodollar Rate
Loan, nine or twelve months or less than one month thereafter, as
selected by the Company in its Loan Notice; provided
that:
(a)
any Interest Period that would otherwise end on a day that is not a
Business Day shall be extended to the next succeeding Business Day
unless such Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding Business
Day;
(b)
any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at
the end of such Interest Period; and
(c)
no Interest Period shall extend beyond the Maturity Date of the
Facility under which such Loan was made.
“
Intermediate Holding Company ” means any Subsidiary of
Holdings that directly owns 100% of the issued and outstanding
Equity Interests of the Company.
“
Investment ” means, as to any Person, any direct or
indirect acquisition or investment by such Person, whether by means
of (a) the purchase or other acquisition of Equity Interests
or debt or other securities of another Person, (b) a loan,
advance or capital contribution to, Guarantee Obligation or
assumption of Indebtedness of, or purchase or other acquisition of
any other debt or equity participation or interest in, another
Person, including any partnership or joint venture interest in such
other Person (excluding, in the case of the Company and its
Subsidiaries, intercompany loans, advances, or Indebtedness having
a term not exceeding 364 days (inclusive of any roll-over or
extensions of terms) and made in the ordinary course of business
consistent with past practice) or (c) the purchase or other
acquisition (in one transaction or a series of transactions) of all
or substantially all of the property and assets or business of
another Person or assets constituting a business unit, line of
business or division of such Person. For purposes of covenant
compliance, the amount of any Investment shall be the amount
actually invested, without adjustment for subsequent increases or
decreases in the value of such Investment. For the avoidance
of doubt, it is understood that the following shall not constitute
“Investments” hereunder: (a) acquisitions of
equipment to be used in the business of the Company or any of its
Subsidiaries, so long as the acquisition costs thereof constitute
Capital Expenditures permitted hereunder and (b) acquisitions
of inventory in the ordinary course of business of the Company and
its Subsidiaries.
31
“ IP
Security Agreement Supplement ” has the meaning specified
in the Intellectual Property Security Agreement.
“ IRS
” means the United States Internal Revenue
Service.
“ Junior
Financing ” has the meaning specified in
Section 7.13(a).
“ Junior
Financing Documentation ” means any documentation
governing any Junior Financing.
“
Laws ” means, collectively, all international,
foreign, Federal, state and local statutes, treaties, rules,
guidelines, regulations, ordinances, codes and administrative or
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, requests,
licenses, authorizations and permits of, and agreements with, any
Governmental Authority, in each case whether or not having the
force of law.
“ L/C
Advance ” means, with respect to each Revolving Credit
Lender, such Lender’s funding of its participation in any L/C
Borrowing in accordance with its Pro Rata Share.
“ L/C
Borrowing ” means an extension of credit resulting from a
drawing under any Letter of Credit which has not been reimbursed on
the date when made or refinanced as a Revolving Credit
Borrowing.
“ L/C
Credit Extension ” means, with respect to any Letter of
Credit, the issuance thereof or extension of the expiry date
thereof, or the renewal or increase of the amount
thereof.
“ L/C
Disbursement ” means a payment or disbursement made by an
L/C Issuer pursuant to a Letter of Credit.
“ L/C
Issuer ” means Credit Suisse, the issuers of the Existing
Letters of Credit and any other Lender that becomes an L/C Issuer
in accordance with Section 2.03(l) or 10.07(k) in its capacity
as an issuer of Letters of Credit hereunder, or any successor
issuer of Letters of Credit hereunder.
“ L/C
Obligations ” means, as at any date of determination, the
aggregate undrawn amount of all outstanding Letters of Credit plus
the aggregate of all Unreimbursed Amounts, including all L/C
Borrowings.
“
Lender ” has the meaning specified in the introductory
paragraph to this Agreement and, as the context requires, includes
an L/C Issuer and the Swing Line Lender, and their respective
successors and assigns as permitted hereunder, each of which is
referred to herein as a “Lender.”
32
“ Lending
Office ” means, as to any Lender, the office or offices
of such Lender described as such in such Lender’s
Administrative Questionnaire, or such other office or offices as a
Lender may from time to time notify the Company and the
Administrative Agent.
“ Letter
of Credit ” means any Existing Letter of Credit or any
letter of credit issued hereunder. A Letter of Credit may be a
commercial letter of credit or a standby letter of
credit.
“ Letter
of Credit Application ” means an application and
agreement for the issuance or amendment of a Letter of Credit in
the form from time to time in use by the relevant L/C
Issuer.
“ Letter
of Credit Expiration Date ” means the day that is five
(5) Business Days prior to the scheduled Maturity Date then in
effect for the Revolving Credit Facility (or, if such day is not a
Business Day, the next preceding Business Day).
“ Letter
of Credit Sublimit ” means an amount equal to the lesser
of (a) $50,000,000 and (b) the aggregate amount of the
Revolving Credit Commitments. The Letter of Credit Sublimit is part
of, and not in addition to, the Revolving Credit
Facility.
“ LIBO
Rate ” means, for any Interest Period with respect to any
Eurodollar Rate Loan, the rate per annum determined by the
Administrative Agent at approximately 11:00 a.m. (London time) on
the date that is two Business Days prior to the commencement of
such Interest Period by reference to the British Bankers’
Association Interest Settlement Rates for deposits in dollars (as
set forth by any service selected by the Administrative Agent that
has been nominated by the British Bankers’ Association as an
authorized information vendor for the purpose of displaying such
rates) for a period equal to such Interest Period; provided
that, to the extent that an interest rate is not ascertainable
pursuant to the foregoing provisions of this definition, the
“Eurodollar Rate” shall be the interest rate per annum
determined by the Administrative Agent to be the average of the
rates per annum at which deposits in dollars are offered for such
relevant Interest Period to major banks in the London interbank
market in London, England by the Administrative Agent at
approximately 11:00 a.m. (London time) on the date that is two
Business Days prior to the beginning of such Interest
Period.
“
Lien ” means any mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or
other), charge, or preference, priority or other security interest
or preferential arrangement of any kind or nature whatsoever
(including any conditional sale or other title retention agreement,
any easement, right of way or other encumbrance on title to real
property, and any Capitalized Lease having substantially the same
economic effect as any of the foregoing).
“
Loan ” means an extension of credit by a Lender to the
Company under Article II in the form of a Term Loan, a Revolving
Credit Loan or a Swing Line Loan.
33
“ Loan
Documents ” means, collectively, (i) this Agreement,
(ii) the Notes, (iii) the Guaranty, (iv) the
Collateral Documents, (v) the Fee Letter, and (vi) each Letter
of Credit Application.
“ Loan
Notice ” means a notice of (a) a Term Borrowing,
(b) a Revolving Credit Borrowing, (c) a conversion of
Loans from one Type to the other, or (d) a continuation of
Eurodollar Rate Loans, pursuant to Section 2.02(a), which, if
in writing, shall be substantially in the form of
Exhibit A.
“ Loan
Parties ” means, collectively, the Company and each
Guarantor.
“
Management Stockholders ” means the members of
management of Parent, Holdings, the Company or its Subsidiaries who
are investors or option holders in Holdings or any direct or
indirect parent thereof (including Parent).
“ Master
Agreement ” has the meaning specified in the definition
of “Swap Contract.”
“
Material Adverse Effect ” means (a) a material
adverse effect on the business, operations, assets, liabilities
(actual or contingent) or financial condition of the Company and
its Subsidiaries, taken as a whole, (b) a material adverse
effect on the ability of the Company or the Loan Parties (taken as
a whole) to perform their respective payment obligations under any
Loan Document to which the Company or any of the Loan Parties is a
party or (c) a material adverse effect on the rights and
remedies of the Lenders under any Loan Document.
“
Material Subsidiary ” shall mean, at any date of
determination, each Restricted Subsidiary of the Company
(a) whose total assets at the last day of the Test Period
ending on the last day of the most recent fiscal period for which
financial statements have been delivered pursuant to Section 6.01
were equal to or greater than 5% of the Total Assets of the Company
and the Restricted Subsidiaries at such date or (b) whose
gross revenues for such Test Period were equal to or greater than
5% of the consolidated gross revenues of the Company and the
Restricted Subsidiaries for such Test Period, in each case
determined in accordance with GAAP; provided that
“Material Subsidiary” shall also include any of the
Company’s Restricted Subsidiaries selected by the Company
which is required to ensure that the Company and all Material
Subsidiaries combined have in the aggregate (i) total assets at the
last day of the most recent Test Period that were equal to or
greater than 95% of the Total Assets of the Company and the
Restricted Subsidiaries at such date and (ii) gross revenues
for such Test Period that were equal to or greater than 95% of the
consolidated gross revenues of the Company and the Restricted
Subsidiaries for such Test Period, in each case determined in
accordance with GAAP.
“
Maturity Date ” means (a) with respect to the
Revolving Credit Facility, the sixth anniversary of the Closing
Date and (b) with respect to the Term Loans, the date that is
six years and six months from the Closing Date, provided
that if either such day is
34
not a Business Day, the
Maturity Date shall be the Business Day immediately preceding such
day.
“ Maximum
Rate ” has the meaning specified in
Section 10.10.
“
Merger ” has the meaning set forth in the preliminary
statements to this Agreement.
“ Merger
Agreement ” means the Agreement and Plan of Merger dated
as of July 15, 2007, among the Company, Merger Sub and the
Target.
“ Merger
Consideration ” means the total funds required to
consummate the Merger.
“ Merger
Costs ” means collectively, the Merger Consideration, the
Debt Prepayment and the Transaction Expenses.
“ Merger
Sub ” means Reaction Acquisition Merger Sub, Inc., a
Delaware corporation.
“
Minority Investment ” means any person (other than a
Subsidiary) in which the Company or any Restricted Subsidiary owns
Equity Interests (or other ownership or profit interests or
units).
“
Moody’s ” means Moody’s Investors Service,
Inc. and any successor thereto.
“
Mortgage ” means, collectively, the deeds of trust,
trust deeds and mortgages made by the Loan Parties in favor or for
the benefit of the Collateral Agent on behalf of the Secured
Parties substantially in the form of Exhibit H (with such
changes as may be customary to account for local Law matters), and
any other mortgages executed and delivered pursuant to
Section 6.11.
“
Mortgage Policies ” has the meaning specified in
Section 6.13(b)(ii).
“
Mortgaged Properties ” has the meaning specified in
paragraph (f) of the definition of Collateral and Guarantee
Requirement.
“
Multiemployer Plan ” means any employee benefit plan
of the type described in Section 4001(a)(3) of ERISA, to which
any Loan Party or any ERISA Affiliate makes or is obligated to make
contributions, or during the preceding five plan years, has made or
been obligated to make contributions.
“ Net
Cash Proceeds ” means:
(a)
with respect to the Disposition of any asset by the Company or any
Restricted Subsidiary or any Casualty Event, the excess, if any, of
(i) the sum of cash and Cash Equivalents received in connection
with such Disposition or
35
Casualty Event
(including any cash or Cash Equivalents received by way of deferred
payment pursuant to, or by monetization of, a note receivable or
otherwise, but only as and when so received and, with respect to
any Casualty Event, any insurance proceeds or condemnation awards
in respect of such Casualty Event actually received by or paid to
or for the account of the Company or any Restricted Subsidiary)
over (ii) the sum of (A) the principal amount, premium or
penalty, if any, interest and other amounts on any Indebtedness
that is secured by the asset subject to such Disposition or
Casualty Event and that is required to be repaid (and is timely
repaid) in connection with such Disposition or Casualty Event
(other than Indebtedness under the Loan Documents), (B) the
out-of-pocket expenses (including attorneys’ fees, investment
banking fees, survey costs, title insurance premiums, and related
search and recording charges, transfer taxes, deed or mortgage
recording taxes, other customary expenses and brokerage, consultant
and other customary fees) actually incurred by the Company or such
Restricted Subsidiary in connection with such Disposition or
Casualty Event, (C) taxes paid or reasonably estimated to be
actually payable in connection therewith, and (D) any reserve
for adjustment in respect of (x) the sale price of such asset or
assets established in accordance with GAAP and (y) any liabilities
associated with such asset or assets and retained by the Company or
any Restricted Subsidiary after such sale or other disposition
thereof, including pension and other post-employment benefit
liabilities and liabilities related to environmental matters or
against any indemnification obligations associated with such
transaction and it being understood that “Net Cash
Proceeds” shall include any cash or Cash Equivalents (i)
received upon the Disposition of any non-cash consideration
received by the Company or any Restricted Subsidiary in any such
Disposition and (ii) upon the reversal (without the
satisfaction of any applicable liabilities in cash in a
corresponding amount) of any reserve described in clause (D)
of the preceding sentence or, if such liabilities have not been
satisfied in cash and such reserve is not reversed within three
hundred and sixty-five (365) days after such Disposition or
Casualty Event, the amount of such reserve; provided that
(x) no net cash proceeds calculated in accordance with the
foregoing realized in a single transaction or series of related
transactions shall constitute Net Cash Proceeds unless such net
cash proceeds shall exceed $10,000,000 and (y) no such net cash
proceeds shall constitute Net Cash Proceeds under this
clause (a) in any fiscal year until the aggregate amount of
all such net cash proceeds in such fiscal year shall exceed
$25,000,000 (and thereafter only net cash proceeds in excess of
such amount shall constitute Net Cash Proceeds under this
clause (a)); and
(b)
with respect to the incurrence or issuance of any Indebtedness by
the Company or any Restricted Subsidiary, the excess, if any, of
(i) the sum of the cash received in connection with such incurrence
or issuance over (ii) the investment banking fees,
underwriting discounts, commissions, costs and other out-of-pocket
expenses and other customary expenses, incurred by the Company or
such Restricted Subsidiary in connection with such incurrence or
issuance.
“ New
Notes ” means the Senior Unsecured Notes.
36
“ New
Notes Documentation ” means the New Notes, and all
documents executed and delivered with respect to the New Notes,
including the Senior Unsecured Notes Indenture.
“
Non-Cash Charges ” has the meaning set forth in the
definition of the term “Consolidated
EBITDA”.
“
Non-Consenting Lender ” has the meaning specified in
Section 3.07(d).
“
Nonrenewal Notice Date ” has the meaning specified in
Section 2.03(b)(iii).
“
Note ” means a Term Note or a Revolving Credit Note,
as the context may require.
“ Notice
of Intent to Cure ” has the meaning specified in
Section 6.02(b).
“ Not
Otherwise Applied ” means, with reference to any amount
of net proceeds of any transaction or event or of Excess Cash Flow
or of the Available Amount, that such amount (a) was not
applied to prepay the Loans pursuant to Section 2.05(b), and
(b) has not previously been (and is not simultaneously being)
applied to anything other than that such particular use or
transaction.
“ NPL
” means the National Priorities List under CERCLA.
“
Obligations ” means all (x) advances to, and debts,
liabilities, obligations, covenants and duties of, any Loan Party
and its Subsidiaries arising under any Loan Document or otherwise
with respect to any Loan or Letter of Credit, whether direct or
indirect (including those acquired by assumption), absolute or
contingent, due or to become due, now existing or hereafter arising
and including interest and fees that accrue after the commencement
by or against any Loan Party or its Subsidiaries of any proceeding
under any Debtor Relief Laws naming such Person as the debtor in
such proceeding, regardless of whether such interest and fees are
allowed claims in such proceeding, (y) obligations of any Loan
Party and its Subsidiaries arising under any Secured Hedge
Agreement and (z) Cash Management Obligations. Without limiting the
generality of the foregoing, the Obligations of the Loan Parties
under the Loan Documents (and of their Subsidiaries to the extent
they have obligations under the Loan Documents) include
(a) the obligation (including guarantee obligations) to pay
principal, interest, Letter of Credit commissions, reimbursement
obligations, charges, expenses, fees, Attorney Costs, indemnities
and other amounts payable by any Loan Party or its Subsidiaries
under any Loan Document and (b) the obligation of any Loan
Party or any of its Subsidiaries to reimburse any amount in respect
of any of the foregoing that any Lender, in its sole discretion,
may elect to pay or advance on behalf of such Loan Party or such
Subsidiary. Notwithstanding the foregoing, (i) the obligations of
the Company or any Subsidiary under any Secured Hedge Agreement and
the Cash Management Obligations shall be secured and guaranteed
pursuant to the Collateral Documents and the Guaranty only to the
extent that, and for so long as, the other Obligations are so
secured and guaranteed and (ii) any release of Collateral or
Guarantors effected in the manner
37
permitted by this
Agreement shall not require the consent of the holders of
obligations under the Secured Hedge Agreements or the holders of
the Cash Management Obligations.
“
Organization Documents ” means, (a) with respect
to any corporation, the certificate or articles of incorporation
and the bylaws (or equivalent or comparable constitutive documents
with respect to any non-U.S. jurisdiction); (b) with respect
to any limited liability company, the certificate or articles of
formation or organization and operating agreement; and
(c) with respect to any partnership, joint venture, trust or
other form of business entity, the partnership, joint venture or
other applicable agreement of formation or organization, if
applicable, and any agreement, instrument, filing or notice with
respect thereto filed in connection with its formation or
organization with the applicable Governmental Authority in the
jurisdiction of its formation or organization and, if applicable,
any certificate or articles of formation or organization of such
entity.
“ Other
Taxes ” has the meaning specified in
Section 3.01(b).
“
Outstanding Amount ” means (a) with respect to
the Term Loans, Revolving Credit Loans and Swing Line Loans on any
date, the outstanding principal amount thereof after giving effect
to any borrowings and prepayments or repayments of Term Loans,
Revolving Credit Loans (including any refinancing of outstanding
unpaid drawings under Letters of Credit or L/C Credit Extensions as
a Revolving Credit Borrowing) and Swing Line Loans, as the case may
be, occurring on such date; and (b) with respect to any L/C
Obligations on any date, the outstanding amount thereof on such
date after giving effect to any L/C Credit Extension occurring on
such date and any other changes thereto as of such date, including
as a result of any reimbursements of outstanding unpaid drawings
under any Letters of Credit (including any refinancing of
outstanding unpaid drawings under Letters of Credit or L/C Credit
Extensions as a Revolving Credit Borrowing) or any reductions in
the maximum amount available for drawing under Letters of Credit
taking effect on such date.
“
Parent ” means ReAble Therapeutics, Inc. (to be
renamed DJO Incorporated), a Delaware corporation.
“
Participant ” has the meaning specified in
Section 10.07(f).
“
Participating Member State ” means each state so
described in any EMU Legislation.
“
PBGC ” means the Pension Benefit Guaranty
Corporation.
“ Pension
Plan ” means any “employee pension benefit
plan” (as such term is defined in Section 3(2) of
ERISA), other than a Multiemployer Plan, that is subject to Title
IV of ERISA and is sponsored or maintained by any Loan Party or any
ERISA Affiliate or to which any Loan Party or any ERISA Affiliate
contributes or has an obligation to contribute, or in the case of a
multiple employer or other plan described in Section 4064(a)
of ERISA, has made contributions at any time during the immediately
preceding five (5) plan years.
38
“
Permitted Acquisition ” has the meaning specified in
Section 7.02(i).
“
Permitted Equity Issuance ” means any sale or issuance
of any Qualified Equity Interests of Holdings (or any direct or
indirect parent of Holdings) or any Intermediate Holding Company or
the Company to the extent permitted hereunder.
“
Permitted Holders ” means the Equity Investors other
than the Management Stockholders to the extent that the amount of
the outstanding voting stock of Holdings (or any direct or indirect
parent thereof) owned beneficially or of record by such Management
Stockholders in the aggregate at any time exceeds fifteen percent
(15%) of the total amount of the outstanding voting stock of
Holdings (or any direct or indirect parent thereof) at such
time.
“
Permitted Holdings Debt ” means unsecured Indebtedness
of any direct or indirect parent of the Company (i) that is
not subject to any Guarantee by the Company or any Restricted
Subsidiary, (ii) that will not mature prior to the date that is
ninety-one (91) days after the Maturity Date of the Term Loans,
(iii) that has no scheduled amortization or payments of principal
(it being understood that such Indebtedness may have mandatory
prepayment, repurchase or redemption provisions satisfying the
requirements of clause (v) hereof), (iv) that does not require any
payments in cash of interest or other amounts in respect of the
principal thereof for at least five years from the date of issuance
or incurrence thereof, and (v) that has mandatory prepayment,
repurchase or redemption, covenant, default and remedy provisions
customary for senior discount notes of an issuer that is the parent
of a borrower under senior secured credit facilities, and in any
event, with respect to covenant, default and remedy provisions, no
more restrictive than those set forth in the Existing Notes
Indenture as of the Closing Date, taken as a whole (other than
provisions customary for senior discount notes of a holding
company); provided that a certificate of a Responsible
Officer delivered to the Administrative Agent at least five
Business Days prior to the incurrence of such Indebtedness,
together with a reasonably detailed description of the material
terms and conditions of such Indebtedness or drafts of the
documentation relating thereto, stating that the Company has
determined in good faith that such terms and conditions satisfy the
foregoing requirement shall be conclusive evidence that such terms
and conditions satisfy the foregoing requirement unless the
Administrative Agent notifies the Company within such five Business
Day period that it disagrees with such determination (including a
reasonable description of the basis upon which it
disagrees).
“
Permitted Refinancing ” means, with respect to any
Person, any modification, refinancing, refunding, renewal or
extension of any Indebtedness of such Person; provided that
(a) the principal amount (or accreted value, if applicable)
thereof does not exceed the principal amount (or accreted value, if
applicable) of the Indebtedness so modified, refinanced, refunded,
renewed or extended except by an amount equal to unpaid accrued
interest and premium thereon plus other reasonable amount paid, and
fees and expenses reasonably incurred, in connection with such
modification, refinancing, refunding, renewal or extension and by
an amount equal to any existing commitments unutilized thereunder,
(b) other than with respect to a Permitted Refinancing in
respect of Indebtedness permitted pursuant to Section 7.03(e),
such
39
modification,
refinancing, refunding, renewal or extension has a final maturity
date equal to or later than the final maturity date of, and has a
Weighted Average Life to Maturity equal to or greater than the
Weighted Average Life to Maturity of, the Indebtedness being
modified, refinanced, refunded, renewed or extended, (c) other
than with respect to a Permitted Refinancing in respect of
Indebtedness permitted pursuant to Section 7.03(e), at the
time thereof, no Event of Default shall have occurred and be
continuing, and (d) if such Indebtedness being modified,
refinanced, refunded, renewed or extended is Indebtedness permitted
pursuant to Section 7.03(b), 7.03(u) or 7.13(a), (i) to the
extent such Indebtedness being modified, refinanced, refunded,
renewed or extended is subordinated in right of payment to the
Obligations, such modification, refinancing, refunding, renewal or
extension is subordinated in right of payment to the Obligations on
terms at least as favorable to the Lenders as those contained in
the documentation governing the Indebtedness being modified,
refinanced, refunded, renewed or extended, (ii) the terms and
conditions (including, if applicable, as to collateral but
excluding as to subordination, interest rate and redemption
premium) of any such modified, refinanced, refunded, renewed or
extended Indebtedness, taken as a whole, are not materially less
favorable to the Loan Parties or the Lenders than the terms and
conditions of the Indebtedness being modified, refinanced,
refunded, renewed or extended; provided that a certificate
of a Responsible Officer delivered to the Administrative Agent at
least five Business Days prior to the incurrence of such
Indebtedness, together with a reasonably detailed description of
the material terms and conditions of such Indebtedness or drafts of
the documentation relating thereto, stating that the Company has
determined in good faith that such terms and conditions satisfy the
foregoing requirement shall be conclusive evidence that such terms
and conditions satisfy the foregoing requirement unless the
Administrative Agent notifies the Company within such five Business
Day period that it disagrees with such determination (including a
reasonable description of the basis upon which it disagrees) and
(iii) such modification, refinancing, refunding, renewal or
extension is incurred by the Person who is the obligor of the
Indebtedness being modified, refinanced, refunded, renewed or
extended.
“
Person ” means any natural person, corporation,
limited liability company, trust, joint venture, association,
company, partnership, Governmental Authority or other
entity.
“
Plan ” means any “employee benefit plan”
(as such term is defined in Section 3(3) of ERISA) established
by any Loan Party or, with respect to any such plan that is subject
to Section 412 of the Code or Title IV of ERISA, any ERISA
Affiliate.
“ Pledged
Debt ” has the meaning specified in the Security
Agreement.
“ Pledged
Equity ” has the meaning specified in the Security
Agreement.
“
Post-Acquisition Period ” means, with respect to any
Specified Transaction, the period beginning on the date such
Specified Transaction is consummated and ending on the last day of
the sixth full consecutive fiscal quarter immediately following the
date on which such Specified Transaction is consummated.
40
“
Post-Closing Integration Amount ” means an amount not
less than $33,000,000 of certain pre-funded post-closing
integration costs identified by the Company to the Arrangers prior
to the date hereof (the “ Specified Post-Closing
Integration Costs ”).
“
Post-Transaction Period ” means, with respect to the
Transaction, the period beginning on the Closing Date and ending on
the last day of the fourth full consecutive fiscal quarter
immediately following the Closing Date.
“
Prime Rate ” means the rate of interest per annum
determined from time to time by Credit Suisse as its prime rate in
effect at its principal office in New York City and notified to the
Company.
“ Pro
Forma Adjustment ” means, for any Test Period that
includes all or any part of a fiscal quarter included in any
Post-Acquisition Period or Post-Transaction Period, with respect to
the Acquired EBITDA of the applicable Acquired Entity or Business
or of the applicable Converted Restricted Subsidiary or the
Consolidated EBITDA of the Company and its Restricted Subsidiaries,
the pro forma increase or decrease in such Acquired EBITDA or such
Consolidated EBITDA, as the case may be, projected by the Company
in good faith as a result of (a) actions that have begun to be
taken or are expected to have been begun to be taken prior to or
during such Post-Acquisition Period or such Post-Transaction
Period, as applicable, for the purposes of realizing reasonably
identifiable and factually supportable cost savings or (b) any
additional costs incurred prior to or during such Post-Acquisition
Period or such Post-Transaction Period, in each case in connection
with the combination of the operations of such Acquired Entity or
Business or of such Converted Restricted Subsidiary with the
operations of the Company and the Restricted Subsidiaries;
provided that, so long as such actions have begun to be
taken or are expected to have been begun to be taken prior to or
during such Post-Acquisition Period or such Post-Transaction
Period, as applicable, or such costs are incurred prior to such
Post-Acquisition Period or such Post-Transaction Period or during
such Post-Acquisition Period or such Post-Acquisition Period,
as applicable, the cost savings related to such actions or such
additional costs, as applicable, it may be assumed, for purposes of
projecting such pro forma increase or decrease to such Acquired
EBITDA or such Consolidated EBITDA, as the case may be, that such
cost savings will be realizable during the entirety of such Test
Period, or such additional costs, as applicable, will be incurred
during the entirety of such Test Period; provided, further,
that any such pro forma increase or decrease to such
Acquired EBITDA or such Consolidated EBITDA, as the case may be,
shall be without duplication for cost savings or additional costs
already included in such Acquired EBITDA or such Consolidated
EBITDA, as the case may be, for such Test Period;
provided, further, that with respect to any action
expected to have begun to be taken, the underlying action shall
actually have begun to be taken prior to the date on which a
Compliance Certificate shall be required to be delivered pursuant
to Section 6.02(b) for the fiscal quarter in which the
relevant cost saving shall have been included in the Acquired
EBITDA or Consolidated EBITDA, as applicable.
41
“ Pro
Forma Balance Sheet ” has the meaning set forth in
Section 5.05(a)(ii).
“ Pro
Forma Basis ”, “ Pro Forma Compliance
” and “ Pro Forma Effect ” mean, with
respect to compliance with any test or covenant hereunder, that
(A) to the extent applicable, the Pro Forma Adjustment shall
have been made and (B) all Specified Transactions and the
following transactions in connection therewith shall be deemed to
have occurred as of the first day of the applicable period of
measurement in such test or covenant: (a) income
statement items (whether positive or negative) attributable to the
property or Person subject to such Specified Transaction, (i) in
the case of a Disposition of all or substantially all Equity
Interests in any Subsidiary of the Company or any division, product
line, or facility used for operations of the Company or any of its
Subsidiaries, shall be excluded, and (ii) in the case of a
Permitted Acquisition or Investment described in the definition
of “Specified Transaction”, shall be included,
(b) any retirement of Indebtedness, and (c) any
Indebtedness incurred or assumed by the Company or any of the
Restricted Subsidiaries in connection therewith and if such
Indebtedness has a floating or formula rate, shall have an implied
rate of interest for the applicable period for purposes of this
definition determined by utilizing the rate which is or would be in
effect with respect to such Indebtedness as at the relevant date of
determination; provided that, without limiting the
application of the Pro Forma Adjustment pursuant to (A) above, the
foregoing pro forma adjustments may be applied to any such test or
covenant solely to the extent that such adjustments are consistent
with the definition of Consolidated EBITDA and give effect to
events (including operating expense reductions) that are (i) (x)
directly attributable to such transaction, (y) expected to have a
continuing impact on the Company and the Restricted Subsidiaries
and (z) factually supportable or (ii) otherwise consistent
with the definition of Pro Forma Adjustment.
“ Pro
Forma Financial Statements ” has the meaning set forth in
Section 5.05(a)(ii).
“ Pro
Rata Share ” means, with respect to each Lender at any
time a fraction (expressed as a percentage, carried out to the
ninth decimal place), the numerator of which is the amount of the
Commitment of such Lender under the applicable Facility or
Facilities at such time and the denominator of which is the amount
of the Aggregate Commitments of all Lenders under the applicable
Facility or Facilities at such time; provided that if such
Commitment has been terminated, then the Pro Rata Share of each
Lender shall be determined based on the Pro Rata Share of such
Lender immediately prior to such termination and after giving
effect to any subsequent assignments made pursuant to the terms
hereof.
“
Projections ” shall have the meaning set forth in
Section 6.01(c).
“
Qualified Equity Interests ” means any Equity
Interests that are not Disqualified Equity Interests.
42
“
Qualifying IPO ” means the issuance by Holdings, any
Intermediate Holding Company, any direct or indirect parent of
Holdings or the Company of its common Equity Interests in an
underwritten primary public offering (other than a public offering
pursuant to a registration statement on Form S-8) pursuant to an
effective registration statement filed with the SEC in accordance
with the Securities Act (whether alone or in connection with a
secondary public offering).
“
Refinanced Term Loans ” has the meaning specified in
Section 10.01.
“
Register ” has the meaning set forth in
Section 10.07(d).
“
Replacement Term Loans ” has the meaning specified in
Section 10.01.
“
Reportable Event ” means any of the events set forth
in Section 4043(c) of ERISA or the regulations issued
thereunder, other than events for which the thirty (30) day notice
period has been waived.
“ Request
for Credit Extension ” means (a) with respect to a
Borrowing, conversion or continuation of Term Loans or Revolving
Credit Loans, a Loan Notice, (b) with respect to an L/C Credit
Extension, a Letter of Credit Application, and (c) with respect to
a Swing Line Loan, a Swing Line Loan Notice.
“
Required Lenders ” means, as of any date of
determination, Lenders having more than 50% of the sum of the
(a) Total Outstandings (with the aggregate amount of each
Lender’s risk participation and funded participation in L/C
Obligations and Swing Line Loans being deemed “held” by
such Lender for purposes of this definition), (b) aggregate
unused Term Commitments and (c) aggregate unused Revolving
Credit Commitments; provided that the unused Term Commitment
and unused Revolving Credit Commitment of, and the portion of the
Total Outstandings held or deemed held by, any Defaulting Lender or
the Sponsor or any Affiliate thereof shall be excluded for purposes
of making a determination of Required Lenders.
“
Responsible Officer ” means the chief executive
officer, president, executive vice president, vice president, chief
financial officer, treasurer or assistant treasurer or other
similar officer of a Loan Party and, as to any document delivered
on the Closing Date, any secretary or assistant secretary of a Loan
Party. Any document delivered hereunder that is signed by a
Responsible Officer of a Loan Party shall be conclusively presumed
to have been authorized by all necessary corporate, partnership
and/or other action on the part of such Loan Party and such
Responsible Officer shall be conclusively presumed to have acted on
behalf of such Loan Party.
“
Restricted Payment ” means any dividend or other
distribution (whether in cash, securities or other property) with
respect to any Equity Interest of the Company or any Restricted
Subsidiary, or any payment (whether in cash, securities or other
property), including any sinking fund or similar deposit, on
account of the purchase, redemption, retirement, defeasance,
acquisition, cancellation or termination of any such Equity
Interest, or on account of any return of capital to the
Company’s stockholders, partners or members (or the
equivalent Persons thereof).
43
“
Restricted Subsidiary ” means any Subsidiary of the
Company other than an Unrestricted Subsidiary.
“
Revolving Commitment Increase ” has the meaning set
forth in Section 2.14(a).
“
Revolving Commitment Increase Lender ” has the meaning
set forth in Section 2.14(a).
“
Revolving Credit Borrowing ” means a borrowing
consisting of simultaneous Revolving Credit Loans of the same Type
and, in the case of Eurodollar Rate Loans, having the same Interest
Period made by each of the Revolving Credit Lenders pursuant to
Section 2.01(b).
“
Revolving Credit Commitment ” means, as to each
Revolving Credit Lender, its obligation to (a) make Revolving
Credit Loans to the Company pursuant to Section 2.01(b),
(b) purchase participations in L/C Obligations in respect of
Letters of Credit and (c) purchase participations in Swing
Line Loans, in an aggregate principal amount at any one time
outstanding not to exceed the amount set forth, and opposite such
Lender’s name on Schedule 2.01 under the caption
“Revolving Credit Commitment” or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as
applicable, as such amount may be adjusted from time to time in
accordance with this Agreement including if applicable pursuant to
Section 2.14. The aggregate Revolving Credit Commitment of all
Revolving Credit Lenders shall be $100,000,000 on the Closing Date,
as such amount may be adjusted from time to time in accordance with
the terms of this Agreement including if applicable pursuant to
Section 2.14.
“
Revolving Credit Exposure ” means, as to each
Revolving Credit Lender, the sum of the outstanding principal
amount of such Revolving Credit Lender’s Revolving Credit
Loans at such time and its Pro Rata Share of the L/C Obligations
and the Swing Line Obligations at such time.
“
Revolving Credit Facility ” means, at any time, the
aggregate amount of the Revolving Credit Lenders’ Revolving
Credit Commitments at such time.
“
Revolving Credit Lender ” means, at any time, any
Lender that has a Revolving Credit Commitment at such
time.
“
Revolving Credit Loan ” has the meaning specified in
Section 2.01(b).
“
Revolving Credit Note ” means a promissory note of the
Company payable to any Revolving Credit Lender or its registered
assigns, in substantially the form of Exhibit C-2 hereto,
evidencing the aggregate Indebtedness of the Company to such
Revolving Credit Lender resulting from the Revolving Credit Loans
made by such Revolving Credit Lender.
“
S&P ” means Standard & Poor’s Ratings
Services, a division of The McGraw-Hill Companies, Inc., and any
successor thereto.
44
“ SEC
” means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal
functions.
“ Secured
Hedge Agreement ” means any Swap Contract permitted under
Article VII that is entered into by and between any Loan Party or
any Restricted Subsidiary and any Hedge Bank.
“ Secured
Parties ” means, collectively, the Administrative Agent,
the Collateral Agent, the Lenders, the Hedge Banks, the Cash
Management Banks, the Supplemental Administrative Agent and each
co-agent or sub-agent appointed by the Administrative Agent from
time to time pursuant to Section 9.01(c).
“
Securities Act ” means the Securities Act of 1933, as
amended.
“
Security Agreement ” means, collectively, the Security
Agreement executed by the Loan Parties, substantially in the form
of Exhibit G-1, together with each other security agreement
supplement executed and delivered pursuant to
Section 6.11.
“
Security Agreement Supplement ” has the meaning
specified in the Security Agreement.
“ Senior
Secured Leverage Ratio ” means, with respect to any Test
Period, the ratio of (a) Consolidated Senior Secured Debt of
the Company and its Restricted Subsidiaries as of the last day of
such Test Period to (b) Consolidated EBITDA of the Company and
its Restricted Subsidiaries for such Test Period.
“ Senior
Unsecured Notes ” means $575,000,000 in aggregate
principal amount of the Company’s 10.875% senior unsecured
notes due 2014 to be co-issued with ReAble Finance Corporation (to
be renamed DJO Finance Corporation), a Delaware
corporation.
“ Senior
Unsecured Notes Indenture ” means the Indenture for the
Senior Unsecured Notes, dated as of November 20, 2007.
“ Sold
Entity or Business ” has the meaning set forth in the
definition of the term “Consolidated
EBITDA”.
“
Solvent ” and “ Solvency ” mean,
with respect to any Person on any date of determination, that on
such date (a) the fair value of the property of such Person is
greater than the total amount of liabilities, including contingent
liabilities, of such Person, (b) the present fair salable
value of the assets of such Person is not less than the amount that
will be required to pay the probable liability of such Person on
its debts as they become absolute and matured, (c) such Person
does not intend to, and does not believe that it will, incur debts
or liabilities beyond such Person’s ability to pay such debts
and liabilities as they mature and (d) such Person is not
engaged in business or a transaction, and is not about to engage in
business or a transaction, for which such Person’s property
would constitute an unreasonably small capital. The amount of
contingent liabilities at any time shall be computed as the amount
that, in the light of all the facts and
45
circumstances existing
at such time, represents the amount that can reasonably be expected
to become an actual or matured liability.
“ SPC
” has the meaning specified in
Section 10.07(i).
“
Specified Acquisition ” means the acquisition
previously disclosed to the Arrangers prior to the Closing Date of
a Person in the same or related line of business as the Company and
its Subsidiaries, having an aggregate consideration not to exceed
$150,000,000, and that (a) the Total Leverage Ratio after giving
Pro Forma Effect to such acquisition (including any cost savings
consistent with section (a)(xi) of the definition of Consolidated
EBITDA herein) as of the last day of the Test Period immediately
preceding such acquisition shall not be greater than the Total
Leverage Ratio immediately before such acquisition and (b) such
acquisition shall be consummated on or prior to December 31,
2008.
“
Specified Cost Savings ” has the meaning specified in
the definition of Consolidated EBITDA.
“
Specified Post-Closing Integration Costs ” has the
meaning specified in the definition of Post-Closing Integration
Amount.
“
Specified Ratings Condition ” shall be deemed to be
satisfied on any day that the corporate family rating assigned to
the Company by Moody’s is B1 or higher and the
corporate rating assigned to the Company by S&P is B+ or
higher, in each case with no negative outlook.
“
Specified Transaction ” means, with respect to any
period, any Investment, Disposition, incurrence or repayment of
Indebtedness, Restricted Payment, Subsidiary designation,
Incremental Term Loan or Revolving Commitment Increase that by the
terms of this Agreement requires “Pro Forma Compliance”
with a test or covenant hereunder or requires such test or covenant
to be calculated on a “Pro Forma Basis”.
“
Sponsors ” means The Blackstone Group and its
Affiliates, but not including, however, any portfolio companies of
any of the foregoing.
“ Sponsor
Management Agreement ” means the Transaction and
Monitoring Fee Agreement between the Sponsor and Parent.
“ Sponsor
Termination Fees ” means the one-time payment under the
Sponsor Management Agreement of a termination fee to the Sponsor
and its Affiliates in the event of either a Change of Control or
the completion of a Qualifying IPO.
“
Statutory Reserves ” shall mean 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
46
holding a Loan) is
subject for Eurocurrency Liabilities (as defined in Regulation D of
the Board). Eurodollar Rate Loans shall be deemed to constitute
Eurocurrency Liabilities (as defined in Regulation D of the Board)
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.
“
Subsidiary ” of a Person means a corporation,
partnership, joint venture, limited liability company or other
business entity of which a majority of the shares of securities or
other interests having ordinary voting power for the election of
directors or other governing body (other than securities or
interests having such power only by reason of the happening of a
contingency) are at the time beneficially owned, or the management
of which is otherwise controlled, directly, or indirectly through
one or more intermediaries, or both, by such Person. Unless
otherwise specified, all references herein to a
“Subsidiary” or to “Subsidiaries” shall
refer to a Subsidiary or Subsidiaries of the Company.
“
Subsidiary Guarantor ” means, collectively, the
Subsidiaries of the Company that are Guarantors.
“
Successor Company ” has the meaning specified in
Section 7.04(d).
“
Supplemental Administrative Agent ” has the meaning
specified in Section 9.13 and “Supplemental
Administrative Agents” shall have the corresponding
meaning.
“ Swap
Contract ” means (a) any and all rate swap
transactions, basis swaps, credit derivative transactions, forward
rate transactions, commodity swaps, commodity options, forward
commodity contracts, equity or equity index swaps or options, bond
or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest
rate options, forward foreign exchange transactions, cap
transactions, floor transactions, collar transactions, currency
swap transactions, cross-currency rate swap transactions, currency
options, spot contracts, or any other similar transactions or any
combination of any of the foregoing (including any options to enter
into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any
and all transactions of any kind, and the related confirmations,
which are subject to the terms and conditions of, or governed by,
any form of master agreement published by the International Swaps
and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such
master agreement, together with any related schedules, a “
Master Agreement ”), including any such obligations or
liabilities under any Master Agreement.
“ Swap
Termination Value ” means, in respect of any one or more
Swap Contracts, after taking into account the effect of any legally
enforceable netting agreement relating to such Swap Contracts,
(a) for any date on or after the date such
47
Swap Contract has been
closed out and termination value(s) determined in accordance
therewith, such termination value(s), and (b) for any date
prior to the date referenced in clause (a), the amount(s)
determined as the mark-to-market value(s) for such Swap Contracts,
as determined based upon one or more mid-market or other readily
available quotations provided by any recognized dealer in such Swap
Contracts (which may include a Lender or any Affiliate of a
Lender).
“ Swing
Line Borrowing ” means a borrowing of a Swing Line Loan
pursuant to Section 2.04.
“ Swing
Line Facility ” means the revolving credit facility made
available by the Swing Line Lender pursuant to
Section 2.04.
“ Swing
Line Lender ” means Credit Suisse, in its capacity as
provider of Swing Line Loans, or any successor swing line lender
hereunder.
“ Swing
Line Loan ” has the meaning specified in
Section 2.04(a).
“ Swing
Line Loan Notice ” means a notice of a Swing Line
Borrowing pursuant to Section 2.04(b), which, if in writing,
shall be substantially in the form of Exhibit B.
“ Swing
Line Obligations ” means, as at any date of
determination, the aggregate principal amount of all Swing Line
Loans outstanding.
“ Swing
Line Sublimit ” means an amount equal to the lesser of
(a) $30,000,000 and (b) the aggregate amount of the
Revolving Credit Commitments. The Swing Line Sublimit is part of,
and not in addition to, the Revolving Credit
Commitments.
“
Target ” has the meaning specified in the recitals to
this Agreement.
“
Taxes ” has the meaning specified in
Section 3.01(a).
“ Term
Borrowing ” means a borrowing consisting of simultaneous
Term Loans of the same Type and, in the case of Eurodollar Rate
Loans, having the same Interest Period made by each of the Term
Lenders pursuant to Section 2.01.
“ Term
Commitment ” means, as to each Term Lender, its
obligation to make a Term Loan to the Company pursuant to
Section 2.01(a) in an aggregate amount (funded at a 1.0%
discount as provided in Section 2.01(a)(ii)) not to exceed the
amount set forth opposite such Lender’s name on
Schedule 2.01(a) under the caption “Term
Commitment” or in the Assignment and Assumption pursuant to
which such Term Lender becomes a party hereto, as applicable, as
such amount may be adjusted from time to time in accordance with
this Agreement. The initial aggregate amount of the Term
Commitments is $1,065,000,000.
48
“ Term
Lender ” means, at any time, any Lender that has a Term
Commitment or a Term Loan at such time.
“ Term
Loan ” means a Loan made pursuant to
Section 2.01(a).
“ Term
Note ” means a promissory note of the Company payable to
any Term Lender or its registered assigns, in substantially the
form of Exhibit C-1 hereto, evidencing the aggregate
Indebtedness of the Company to such Term Lender resulting from the
Term Loans made by such Term Lender.
“ Test
Period ” in effect at any time shall mean the most recent
period of four consecutive fiscal quarters of the Company ended on
or prior to such time (taken as one accounting period) in respect
of which financial statements for each quarter or fiscal year in
such period have been or are required to be delivered pursuant to
Section 6.01(a) or (b).
“
Threshold Amount ” means $25,000,000.
“ Total
Assets ” means the total assets of the Company and the
Restricted Subsidiaries on a consolidated basis, as shown on the
most recent balance sheet of the Company delivered pursuant to
Section 6.01(a) or (b) or, for the period prior to the time
any such statements are so delivered pursuant to
Section 6.01(a) or (b), the pro forma financial statements of
the Company giving effect to the Transaction as set forth in the
Offering Circular dated November 20, 2007, relating to the New
Notes.
“ Total
Leverage Ratio ” means, as of any date of determination,
the ratio of (a) Consolidated Total Debt of the Company and
the Restricted Subsidiaries as of the last day of the most recent
Test Period ended on or prior to such date of determination to
(b) Consolidated EBITDA of the Company and the Restricted
Subsidiaries for such Test Period.
“ Total
Outstandings ” means, at any time, the sum of (i)
the aggregate Outstanding Amount of all Loans at such time and
(ii) the aggregate Outstanding Amount of all L/C Obligations
at such time.
“
Tranche ” means a category of Commitments or Credit
Extensions thereunder. For purposes hereof, each of the following
comprises a separate Tranche: (a) the unused Revolving
Commitments, (b) the outstanding Revolving Credit Loans and
L/C Obligations in respect of Letters of Credit and (c) the
outstanding Term Loans.
“
Transaction ” means, collectively, (a) the Equity
Contribution, (b) the Merger, (c) the issuance of the New
Notes, (d) the refinancing of each of the Existing Credit
Agreements and the termination of all commitments thereunder,
(e) the funding of the Term Loans in an aggregate amount of
$1,065,000,000 (funded at a 1.0% discount) on the Closing Date, (f)
the funding of the Post-Closing Integration Amount, (g) the
consummation of any other transactions in connection with the
foregoing, and (h) the payment of the fees and expenses
incurred in connection with any of the foregoing.
49
“
Transaction Expenses ” means any fees or expenses
incurred or paid by the Parent, Target, Merger Sub, Holdings (or
any direct or indirect parents thereof), the Company or any
Restricted Subsidiary in connection with the Transaction, this
Agreement and the other Loan Documents and the transactions
contemplated hereby and thereby.
“
Type ” means, with respect to a Loan, its character as
a Base Rate Loan or a Eurodollar Rate Loan.
“
Unaudited Financial Statements ” has the meaning set
forth in Section 4.01(f).
“ Uniform
Commercial Code ” means the Uniform Commercial Code as
the same may from time to time be in effect in the State of New
York or the Uniform Commercial Code (or similar code or statute) of
another jurisdiction, to the extent it may be required to apply to
any item or items of Collateral.
“
United States ” and “ U.S. ”
mean the United States of America.
“U.S.
Lender” has the meaning set forth in
Section 10.15(b).
“
Unreimbursed Amount ” has the meaning set forth in
Section 2.03(c)(i).
“
Unrestricted Subsidiary ” means (i) each Subsidiary of
the Company listed on Schedule 1.01A, (ii) any Subsidiary
of the Company designated by the board of directors of the Company
as an Unrestricted Subsidiary pursuant to Section 6.14
subsequent to the date hereof and (iii) any Subsidiary of an
Unrestricted Subsidiary.
“
Weighted Average Life to Maturity ” means, when
applied to any Indebtedness at any date, the number of years
obtained by dividing: (i) the sum of the products obtained by
multiplying (a) the amount of each then remaining installment,
sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof,
by (b) the number of years (calculated to the nearest
one-twelfth) that will elapse between such date and the making of
such payment; by (ii) the then outstanding principal amount of
such Indebtedness.
“ wholly
owned ” means, with respect to a Subsidiary of a Person,
a Subsidiary of such Person all of the outstanding Equity Interests
of which (other than (x) director’s qualifying shares and (y)
shares issued to foreign nationals to the extent required by
applicable Law) are owned by such Person and/or by one or more
wholly owned Subsidiaries of such Person.
SECTION 1.02. Other Interpretive
Provisions . With reference to this Agreement and each other
Loan Document, unless otherwise specified herein or in such other
Loan Document:
(a) The meanings of defined terms are
equally applicable to the singular and plural forms of the defined
terms.
50
(b) (i) The words
“herein,” “hereto,” “hereof”
and “hereunder” and words of similar import when used
in any Loan Document shall refer to such Loan Document as a whole
and not to any particular provision thereof.
(ii) Article, Section, Exhibit and
Schedule references are to the Loan Document in which such
reference appears.
(iii) The term “including” is by
way of example and not limitation.
(iv) The term “documents” includes
any and all instruments, documents, agreements, certificates,
notices, reports, financial statements and other writings, however
evidenced, whether in physical or electronic form.
(c) In the computation of periods of time
from a specified date to a later specified date, the word
“from” means “from and including;” the
words “to” and “until” each mean “to
but excluding;” and the word “through” means
“to and including.”
(d) Section headings herein and in
the other Loan Documents are included for convenience of reference
only and shall not affect the interpretation of this Agreement or
any other Loan Document.
SECTION 1.03. Accounting Terms .
(a) All accounting terms not specifically or completely
defined herein shall be construed in conformity with, and all
financial data (including financial ratios and other financial
calculations) required to be submitted pursuant to this Agreement
shall be prepared in conformity with, GAAP, applied in a manner
consistent with that used in preparing the Audited Financial
Statements, except as otherwise specifically prescribed
herein.
(b) Notwithstanding anything to the
contrary herein, for purposes of determining compliance with any
test or covenant contained in this Agreement with respect to any
period during which any Specified Transaction occurs, the Senior
Secured Leverage Ratio, the Total Leverage Ratio and Interest
Coverage Ratio shall be calculated with respect to such period and
such Specified Transaction on a Pro Forma Basis.
SECTION 1.04. Rounding . Any financial
ratios required to be maintained by the Company pursuant to this
Agreement (or required to be satisfied in order for a specific
action to be permitted under this Agreement) shall be calculated by
dividing the appropriate component by the other component, carrying
the result to one place more than the number of places by which
such ratio is expressed herein and rounding the result up or down
to the nearest number (with a rounding-up if there is no nearest
number).
SECTION 1.05. References to Agreements,
Laws, Etc . Unless otherwise expressly provided herein,
(a) references to Organization Documents, agreements
(including the Loan Documents) and other contractual instruments
shall be deemed to include all subsequent amendments, restatements,
extensions, supplements, replacements and other modifications
thereto, but only to the extent that such amendments, restatements,
extensions, supplements, replacements and other modifications
are
51
permitted by
any Loan Document; and (b) references to any Law shall include
all statutory and regulatory provisions consolidating, amending,
replacing, supplementing or interpreting such Law.
SECTION 1.06. Times of Day . Unless
otherwise specified, all references herein to times of day shall be
references to Eastern time (daylight or standard, as
applicable).
SECTION 1.07. Timing of Payment of
Performance . When the payment of any obligation or the
performance of any covenant, duty or obligation is stated to be due
or performance required on a day which is not a Business Day, the
date of such payment (other than as described in the definition of
Interest Period) or performance shall extend to the immediately
succeeding Business Day.
SECTION 1.08. Currency Equivalents
Generally . For purposes of determining compliance with
Sections 7.01, 7.02 and 7.03 with respect to any amount of
obligations, Liens, Indebtedness or Investment in a currency other
than Dollars, no Default shall be deemed to have occurred solely as
a result of changes in rates of exchange occurring after the time
such obligations, Liens, Indebtedness or Investment is incurred;
provided that, for the avoidance of doubt, the foregoing
provisions of this Section 1.08 shall otherwise apply to such
Sections, including with respect to determining whether any
obligations, Liens Indebtedness or Investment may be incurred at
any time under such Sections. For purposes of determining
compliance under Sections 7.02, 7.05, 7.06 and 7.11, any amount in
a currency other than Dollars will be converted to Dollars based on
the average Exchange Rate for such currency for the most recent
twelve-month period immediately prior to the date of determination
determined in a manner consistent with that used in calculating
Consolidated EBITDA for the applicable period;
provided , however , that the foregoing shall not be
deemed to apply to the determination of any amount of
Indebtedness.
ARTICLE II
The Commitments and Credit
Extensions
SECTION 2.01. The Loans .
(a) The Term Borrowings . (i) Subject to
the terms and conditions set forth herein, each Term Lender
severally agrees to make to the Company a single loan in an amount
equal to such Term Lender’s Term Commitment on the Closing
Date. Amounts borrowed under this Section 2.01(a) and repaid
or prepaid may not be reborrowed. Term Loans may be Base Rate Loans
or Eurodollar Rate Loans, as further provided herein.
(ii) The Term Loans shall be funded by each
Term Lender to the Company on the Closing Date at a 1.0% discount;
accordingly, the amount of Term Loans funded by each Term Lender to
the Company on the Closing Date shall be in an amount equal to
99.0% of the stated principal amount of such Term
Loans.
52
(b) The Revolving Credit
Borrowings . Subject to the terms and conditions set forth
herein each Revolving Credit Lender severally agrees to make loans
to the Company (each such loan, a “ Revolving Credit
Loan ”) from time to time, on any Business Day until the
Maturity Date with respect to the Revolving Credit Facility, in an
aggregate principal amount not to exceed at any time outstanding
the amount of such Lender’s Revolving Credit Commitment;
provided that after giving effect to any Revolving Credit
Borrowing, the aggregate Outstanding Amount of the Revolving Credit
Loans of any Lender, plus such Lender’s Pro Rata Share of the
Outstanding Amount of all L/C Obligations, plus such Lender’s
Pro Rata Share of the Outstanding Amount of all Swing Line Loans
shall not exceed such Lender’s Revolving Credit Commitment.
Within the limits of each Lender’s Revolving Credit
Commitment, and subject to the other terms and conditions hereof,
the Company may borrow under this Section 2.01(b), prepay
under Section 2.05, and reborrow under this
Section 2.01(b). Revolving Credit Loans may be Base Rate Loans
or Eurodollar Rate Loans, as further provided herein.
SECTION 2.02. Borrowings, Conversions and
Continuations of Loans . (a) Each Term Borrowing, each
Revolving Credit Borrowing, each conversion of Term Loans or
Revolving Credit Loans from one Type to the other, and each
continuation of Eurodollar Rate Loans shall be made upon the
Company’s irrevocable notice to the Administrative Agent,
which may be given by telephone. Each such notice must be received
by the Administrative Agent not later than 11:00 a.m. (i) three (3)
Business Days prior to the requested date of any Borrowing of, or
continuation of, Eurodollar Rate Loans or any conversion of Base
Rate Loans to Eurodollar Rate Loans, and (ii) one (1) Business
Day before the requested borrowing date of Base Rate Loans or
conversion of any Eurodollar Loan to Base Rate Loans. Each
telephonic notice by the Company pursuant to this
Section 2.02(a) must be confirmed promptly by delivery to the
Administrative Agent of a written Loan Notice, appropriately
completed and signed by a Responsible Officer of the Company. Each
Borrowing of, conversion to or continuation of Eurodollar Rate
Loans shall be in a principal amount of $1,000,000 or a whole
multiple of $500,000 in excess thereof. Except as provided in
Sections 2.03(c) and 2.04(c), each Borrowing of or conversion
to Base Rate Loans shall be in a principal amount of $1,000,000 or
a whole multiple of $100,000 in excess thereof. Each Loan Notice
(whether telephonic or written) shall specify (i) whether the
Company is requesting a Term Borrowing, a Revolving Credit
Borrowing, a conversion of Term Loans or Revolving Credit Loans
from one Type to the other, or a continuation of Eurodollar Rate
Loans, (ii) the requested date of the Borrowing, conversion or
continuation, as the case may be (which shall be a Business Day),
(iii) the principal amount of Loans to be borrowed, converted
or continued, (iv) the Type of Loans to be borrowed or to
which existing Term Loans or Revolving Credit Loans are to be
converted, (v) the number and location of the account to which
funds are to be disbursed and (vi) if applicable, the duration
of the Interest Period with respect thereto. If the Company fails
to specify a Type of Loan in a Loan Notice or fails to give a
timely notice requesting a conversion or continuation, then the
applicable Term Loans or Revolving Credit Loans shall be made as,
or converted to, Base Rate Loans. Any such automatic conversion to
Base Rate Loans shall be effective as of the last day of the
Interest Period then in effect with respect to the applicable
Eurodollar Rate Loans. If the Company requests a Borrowing of,
conversion to, or continuation of Eurodollar Rate Loans in
any
53
such Loan
Notice, but fails to specify an Interest Period, it will be deemed
to have specified an Interest Period of one (1) month.
(b) Following receipt of a Loan Notice,
the Administrative Agent shall promptly notify each Lender of the
amount of its Pro Rata Share of the applicable Class of Loans, and
if no timely notice of a conversion or continuation is provided by
the Company, the Administrative Agent shall notify each Lender of
the details of any automatic conversion to Base Rate Loans or
continuation described in Section 2.02(a). In the case of each
Borrowing, each Appropriate Lender shall make the amount of its
Loan available to the Administrative Agent in immediately available
funds at the Administrative Agent’s Office not later than
1:00 p.m. on the Business Day specified in the applicable Loan
Notice. Upon satisfaction of the applicable conditions set forth in
Section 4.02 (and, if such Borrowing is the initial Credit
Extension, Section 4.01), the Administrative Agent shall make
all funds so received available to the Company in like funds as
received by the Administrative Agent by wire transfer of such funds
in accordance with instructions provided to (and reasonably
acceptable to) the Administrative Agent by the Company.
(c) Except as otherwise provided herein,
a Eurodollar Rate Loan may be continued or converted only on the
last day of an Interest Period for such Eurodollar Rate Loan unless
the Company pays the amount due, if any, under Section 3.05 in
connection therewith. During the existence of an Event of Default,
the Required Lenders may require that no Loans be converted to or
continued as Eurodollar Rate Loans.
(d) The Administrative Agent shall
promptly notify the Company and the Lenders of the interest rate
applicable to any Interest Period for Eurodollar Rate Loans upon
determination of such interest rate. The determination of the
Eurodollar Rate by the Administrative Agent shall be conclusive in
the absence of manifest error. At any time that Base Rate Loans are
outstanding, the Administrative Agent shall notify the Company and
the Lenders of any change in the Prime Rate used in determining the
Base Rate promptly following the announcement of such change. All
computations of interest hereunder shall be made in accordance with
Section 2.08 and Section 2.10 hereunder
(e) After giving effect to all Term
Borrowings, all Revolving Credit Borrowings, all conversions of
Term Loans or Revolving Credit Loans from one Type to the other,
and all continuations of Term Loans or Revolving Credit Loans as
the same Type, there shall not be more than fifteen (15) Interest
Periods in effect.
(f) The failure of any Lender to make the
Loan to be made by it as part of any Borrowing shall not relieve
any other Lender of its obligation, if any, hereunder to make its
Loan on the date of such Borrowing, but no Lender shall be
responsible for the failure of any other Lender to make the Loan to
be made by such other Lender on the date of any
Borrowing.
(g) Unless the Administrative Agent shall
have received notice from a Lender prior to the date of any
Borrowing that such Lender will not make available to the
Administrative Agent such Lender’s portion of such Borrowing,
the Administrative
54
Agent may,
with the Company’s consent, assume that such Lender has made
such portion available to the Administrative Agent on the date of
such Borrowing in accordance with paragraph (b) above, and the
Administrative Agent may, in reliance upon such assumption, make
available to the Company on such date a corresponding amount. If
the Administrative Agent shall have so made funds available, then,
to the extent that such Lender shall not have made such portion
available to the Administrative Agent, each of such Lender and the
Company severally agrees to repay to the Administrative Agent
forthwith on demand such corresponding amount together with
interest thereon, for each day from the date such amount is made
available to the Company until the date such amount is repaid to
the Administrative Agent at (i) in the case of the Company, the
interest rate applicable at the time to the Loans comprising such
Borrowing and (ii) in the case of such Lender, the greater of the
Federal Funds Rate and a rate determined by the Administrative
Agent in accordance with banking industry rules on interbank
compensation. A certificate of the Administrative Agent submitted
to any Lender with respect to any amounts owing under this
Section 2.02(g) shall be conclusive in the absence of manifest
error. If such Lender’s portion of such Borrowing is not made
available to the Administrative Agent by such Lender within three
Business Days after such the date of such Borrowing, the
Administrative Agent shall also be entitled to recover such amount
with interest thereon accruing from the date on which the
Administrative Agent made the funds available to the Company at the
rate per annum applicable to Base Rate Loans under the relevant
Facility, on demand, from the Company. If such Lender shall repay
to the Administrative Agent such corresponding amount, such amount
shall constitute such Lender’s Loan as part of such Borrowing
for purposes of this Agreement, and the Company’s obligation
to repay the Administrative Agent such corresponding amount
pursuant to this Section 2.02(g) shall cease.
SECTION 2.03. Letters of Credit .
(a) The Letter of Credit Commitment . (i) On and
after the Closing Date the Existing Letters of Credit will
constitute Letters of Credit under this Agreement and for purposes
hereof will be deemed to have been issued on the Closing
Date.
(ii) Subject to the terms and conditions set
forth herein, (A) each L/C Issuer agrees, in reliance upon the
agreements of the other Revolving Credit Lenders set forth in this
Section 2.03, (1) from time to time on any Business Day during
the period from the Closing Date until the date that is five (5)
days prior to the Letter of Credit Expiration Date, to issue
Letters of Credit denominated in Dollars for the account of the
Company ( provided , that a Letter of Credit may be issued
hereunder at the request of the Company for the account of any
Subsidiary of the Company and such Letter of Credit shall be deemed
for all purposes hereunder to be for the account of the Company)
and to amend or renew Letters of Credit previously issued by it, in
accordance with Section 2.03(b), and (2) to honor drafts under
the Letters of Credit and (B) the Revolving Credit Lenders
severally agree to participate in Letters of Credit issued pursuant
to this Section 2.03; provided that no L/C Issuer shall
be obligated to make any L/C Credit Extension with respect to any
Letter of Credit, and no Lender shall be obligated to participate
in any Letter of Credit if as of the date of such L/C Credit
Extension, (y) the Revolving Credit Exposure of any Lender would
exceed such
55
Lender’s Revolving Credit Commitment or
(z) the Outstanding Amount of the L/C Obligations would exceed the
Letter of Credit Sublimit. Within the foregoing limits, and subject
to the terms and conditions hereof, the Company’s ability to
obtain Letters of Credit shall be fully revolving, and accordingly
the Company may, during the foregoing period, obtain Letters of
Credit to replace Letters of Credit that have expired or that have
been drawn upon and reimbursed.
(iii) An L/C Issuer shall be under no
obligation to issue any Letter of Credit if:
(A)
any order, judgment or decree of any Governmental Authority or
arbitrator shall by its terms purport to enjoin or restrain such
L/C Issuer from issuing such Letter of Credit, or any Law
applicable to such L/C Issuer or any directive (whether or not
having the force of law) from any Governmental Authority with
jurisdiction over such L/C Issuer shall prohibit, or direct that
such L/C Issuer refrain from, the issuance of letters of credit
generally or such Letter of Credit in particular or shall impose
upon such L/C Issuer with respect to such Letter of Credit any
restriction, reserve or capital requirement (for which such L/C
Issuer is not otherwise compensated hereunder) not in effect on the
Closing Date, or shall impose upon such L/C Issuer any unreimbursed
loss, cost or expense which was not applicable on the Closing Date
(for which the L/C Issuer is not otherwise compensated
hereunder);
(B)
subject to Section 2.03(b)(iii), the expiry date of such
requested Letter of Credit would occur more than twelve months
after the date of issuance or last renewal, unless the Required
Lenders have approved such expiry date;
(C)
the expiry date of such requested Letter of Credit would occur
after the Letter of Credit Expiration Date, unless the relevant L/C
Issuer has approved such expiry date, but so long as the Revolving
Credit Lenders are no longer obligated to reimburse the relevant
L/C Issuer beyond such date unless all Revolving Lenders have
approved such expiry date;
(D)
the issuance of such Letter of Credit would violate any Laws
binding upon the L/C Issuer; or
(E)
such Letter of Credit is in an initial amount less than
$100,000.
(iv) An L/C Issuer shall be under no obligation
to amend any Letter of Credit if (A) such L/C Issuer would
have no obligation at such time to issue such Letter of Credit in
its amended form under the terms hereof, or (B) the
beneficiary of such Letter of Credit does not accept the proposed
amendment to such Letter of Credit.
56
(v)
Each L/C Issuer shall act on behalf of the Lenders with respect to
any Letters of Credit issued by it and the documents associated
therewith, and each L/C Issuer shall have all of the benefits and
immunities (A) provided to the Administrative Agent in Article
IX with respect to any acts taken or omissions suffered by such L/C
Issuer in connection with Letters of Credit issued by it or
proposed to be issued by it and any Letter of Credit Application
(and any other document, agreement or instrument entered into by
such L/C Issuer and the Company or in favor of such L/C Issuer)
pertaining to such Letters of Credit as fully as if the term
“Administrative Agent” as used in Article IX included
such L/C Issuer with respect to such acts or omissions, and
(B) as additionally provided herein with respect to each L/C
Issuer.
(b) Procedures for Issuance and
Amendment of Letters of Credit; Auto-Renewal Letters of Credit
. (i) Each Letter of Credit shall be issued or amended, as the
case may be, upon the request of the Company delivered to an L/C
Issuer (with a copy to the Administrative Agent) in the form of a
Letter of Credit Application, appropriately completed and signed by
a Responsible Officer of the Company. Such Letter of Credit
Application must be received by the relevant L/C Issuer and the
Administrative Agent not later than 11:00 a.m. at least two (2)
Business Days prior to the proposed issuance date or date of
amendment, as the case may be; or, in each case, such later date
and time as relevant L/C Issuer may agree in a particular instance
in its sole discretion. In the case of a request for an initial
issuance of a Letter of Credit, such Letter of Credit Application
shall specify in form and detail reasonably satisfactory to the
relevant L/C Issuer: (a) the proposed issuance date of
the requested Letter of Credit (which shall be a Business Day); (b)
the amount thereof; (c) the expiry date thereof; (d) the
name and address of the beneficiary thereof; (e) the documents
to be presented by such beneficiary in case of any drawing
thereunder; (f) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder;
and (g) such other matters as the relevant L/C Issuer may
reasonably request. In the case of a request for an amendment of
any outstanding Letter of Credit, such Letter of Credit Application
shall specify in form and detail reasonably satisfactory to the
relevant L/C Issuer (1) the Letter of Credit to be amended; (2) the
proposed date of amendment thereof (which shall be a Business Day);
(3) the nature of the proposed amendment; and (4) such other
matters as the relevant L/C Issuer may reasonably
request.
(ii) Promptly after receipt of any Letter of
Credit Application, the relevant L/C Issuer will confirm with the
Administrative Agent (by telephone or in writing) that the
Administrative Agent has received a copy of such Letter of Credit
Application from the Company and, if not, such L/C Issuer will
provide the Administrative Agent with a copy thereof. Upon receipt
by the relevant L/C Issuer of confirmation from the Administrative
Agent that the requested issuance or amendment is permitted in
accordance with the terms hereof, then, subject to the terms and
conditions hereof, such L/C Issuer shall, on the requested date,
issue a Letter of Credit for the account of the Company or enter
into the applicable amendment, as the case may be. Immediately upon
the issuance of each Letter of Credit, each Revolving Credit Lender
shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the relevant L/C Issuer a risk
57
participation in such Letter of Credit in an
amount equal to the product of such Lender’s Pro Rata Share
times the amount of such Letter of Credit.
(iii) If the Company so requests in any
applicable Letter of Credit Application, the relevant L/C Issuer
shall agree to issue a Letter of Credit that has automatic renewal
provisions (each, an “ Auto-Renewal Letter of Credit
”); provided that any such Auto-Renewal Letter of
Credit must permit the relevant L/C Issuer to prevent any such
renewal at least once in each twelve month period (commencing with
the date of issuance of such Letter of Credit) by giving prior
notice to the beneficiary thereof not later than a day (the “
Nonrenewal Notice Date ”) in each such twelve month
period to be agreed upon at the time such Letter of Credit is
issued. Unless otherwise directed by the relevant L/C Issuer, the
Company shall not be required to make a specific request to the
relevant L/C Issuer for any such renewal. Once an Auto-Renewal
Letter of Credit has been issued, the Lenders shall be deemed to
have authorized (but may not require) the relevant L/C Issuer to
permit the renewal of such Letter of Credit at any time to an
expiry date not later than the Letter of Credit Expiration Date;
provided that the relevant L/C Issuer shall not permit any
such renewal if (A) the relevant L/C Issuer has determined that it
would have no obligation at such time to issue such Letter of
Credit in its renewed form under the terms hereof (by reason of the
provisions of Section 2.03(a)(ii) or otherwise), or
(B) it has received notice (which may be by telephone or in
writing) on or before the day that is five (5) Business Days before
the Nonrenewal Notice Date from the Administrative Agent, any
Revolving Credit Lender or the Company that one or more of the
applicable conditions specified in Section 4.02 is not then
satisfied.
(iv) Promptly after its delivery of any Letter
of Credit or any amendment to a Letter of Credit to an advising
bank with respect thereto or to the beneficiary thereof, the L/C
Issuer will also deliver to the Company and the Administrative
Agent a true and complete copy of such Letter of Credit or
amendment.
(c) Drawings and Reimbursements;
Funding of Participations . (i) Upon receipt from the
beneficiary of any Letter of Credit of any notice of a drawing
under such Letter of Credit, the relevant L/C Issuer shall notify
promptly the Company and the Administrative Agent thereof. On the
Business Day following the date on which the Company shall have
received notice of any payment by an L/C Issuer under a Letter of
Credit (or, if the Company shall have received such notice later
than 10:00 a.m. on any Business Day, on the second Business Day
following the receipt of such notice) (each such date, an “
Honor Date ”), the Company shall reimburse such L/C
Issuer through the Administrative Agent in an amount equal to the
amount of such drawing; provided that if such reimbursement
is not made on the respective date of payment by the L/C Issuer,
the Company shall pay interest on such amount at a rate per annum
equal to the Applicable Rate then in effect in respect of Base Rate
Loans from the date of such payment until such Business Day. If the
Company fails to so reimburse such L/C Issuer by such time, unless
the Company shall have notified the Administrative Agent and the
relevant L/C Issuer prior to 11:00 a.m. on the Honor Date that the
Company intends to reimburse the L/C Issuer for the amount of the
unreimbursed drawing (the “ Unreimbursed Amount
”)
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with funds
other than proceeds of Revolving Credit Loans, the Administrative
Agent shall promptly notify each Appropriate Lender of the Honor
Date, the Unreimbursed Amount, and the amount of such Appropriate
Lender’s Pro Rata Share thereof. In such event, the Company
shall be deemed to have requested a Revolving Credit Borrowing of
Base Rate Loans to be disbursed on the Honor Date in an amount
equal to the Unreimbursed Amount, without regard to the minimum and
multiples specified in Section 2.02 for the principal amount
of Base Rate Loans but subject to the amount of the unutilized
portion of the Revolving Credit Commitments of the Appropriate
Lenders and the conditions set forth in Section 4.02 (other
than the delivery of a Loan Notice). Any notice given by an L/C
Issuer or the Administrative Agent pursuant to this
Section 2.03(c)(i) may be given by telephone if immediately
confirmed in writing; provided that the lack of such an
immediate confirmation shall not affect the conclusiveness or
binding effect of such notice.
(ii) Each Appropriate Lender (including any
Lender acting as an L/C Issuer) shall upon any notice pursuant to
Section 2.03(c)(i) make funds available to the Administrative
Agent for the account of the relevant L/C Issuer at the
Administrative Agent’s Office for payments in an amount equal
to its Pro Rata Share of the Unreimbursed Amount not later than
1:00 p.m. on the Business Day specified in such notice by the
Administrative Agent, whereupon, subject to the provisions of
Section 2.03(c)(iii), each Appropriate Lender that so makes
funds available shall be deemed to have made a Base Rate Loan to
the Company in such amount. The Administrative Agent shall remit
the funds so received to the relevant L/C Issuer.
(iii) With respect to any Unreimbursed Amount
that is not fully refinanced by a Revolving Credit Borrowing of
Base Rate Loans because the conditions set forth in
Section 4.02 cannot be satisfied or for any other reason, the
Company shall be deemed to have incurred from the relevant L/C
Issuer an L/C Borrowing in the amount of the Unreimbursed Amount
that is not so refinanced, which L/C Borrowing shall be due and
payable on demand (together with interest) and shall bear interest
at the Default Rate. In such event, each Appropriate Lender’s
payment to the Administrative Agent for the account of the relevant
L/C Issuer pursuant to Section 2.03(c)(ii) shall be deemed
payment in respect of its participation in such L/C Borrowing and
shall constitute an L/C Advance from such Lender in satisfaction of
its participation obligation under this
Section 2.03.
(iv) Until each Appropriate Lender funds its
Revolving Credit Loan or L/C Advance pursuant to this
Section 2.03(c) to reimburse the relevant L/C Issuer for any
amount drawn under any Letter of Credit, interest in respect of
such Lender’s Pro Rata Share of such amount shall be solely
for the account of the relevant L/C Issuer.
(v)
Each Revolving Credit Lender’s obligation to make Revolving
Credit Loans or L/C Advances to reimburse an L/C Issuer for amounts
drawn under Letters of Credit, as contemplated by this
Section 2.03(c), shall be absolute and unconditional and shall
not be affected by any circumstance, including (A) any
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setoff, counterclaim, recoupment, defense or
other right which such Lender may have against the relevant L/C
Issuer, the Company or any other Person for any reason whatsoever;
(B) the occurrence or continuance of a Default, or
(C) any other occurrence, event or condition, whether or not
similar to any of the foregoing; provided that each
Revolving Credit Lender’s obligation to make Revolving Credit
Loans pursuant to this Section 2.03(c) is subject to the
conditions set forth in Section 4.02 (other than delivery by
the Company of a Loan Notice ). No making of an L/C Advance shall
relieve or otherwise impair the obligation of the Company to
reimburse the relevant L/C Issuer for the amount of any payment
made by such L/C Issuer under any Letter of Credit, together with
interest as provided herein.
(vi) If any Revolving Credit Lender fails to
make available to the Administrative Agent for the account of the
relevant L/C Issuer any amount required to be paid by such Lender
pursuant to the foregoing provisions of this Section 2.03(c)
by the time specified in Section 2.03(c)(ii), such L/C Issuer
shall be entitled to recover from such Lender (acting through the
Administrative Agent), on demand, such amount with interest thereon
for the period from the date such payment is required to the date
on which such payment is immediately available to such L/C Issuer
at a rate per annum equal to the greater of the Federal Funds Rate
and a rate determined by such L/C Issuer in accordance with banking
industry rules on interbank compensation. A certificate of the
relevant L/C Issuer submitted to any Revolving Credit Lender
(through the Administrative Agent) with respect to any amounts
owing under this Section 2.03(c)(vi) shall be conclusive
absent manifest error.
(d)
Repayment of Participations. (i) If, at any time
after an L/C Issuer has made a payment under any Letter of Credit
and has received from any Revolving Credit Lender such
Lender’s L/C Advance in respect of such payment in accordance
with Section 2.03(c), the Administrative Agent receives for
the account of such L/C Issuer any payment in respect of the
related Unreimbursed Amount or interest thereon (whether directly
from the Company or otherwise, including proceeds of Cash
Collateral applied thereto by the Administrative Agent), the
Administrative Agent will distribute to such Lender its Pro Rata
Share thereof (appropriately adjusted, in the case of interest
payments, to reflect the period of time during which such
Lender’s L/C Advance was outstanding) in the same funds as
those received by the Administrative Agent.
(ii) If any payment received by the
Administrative Agent for the account of an L/C Issuer pursuant to
Section 2.03(c)(i) is required to be returned under any of the
circumstances described in Section 10.06 (including pursuant
to any settlement entered into by such L/C Issuer in its
discretion), each Appropriate Lender shall pay to the
Administrative Agent for the account of such L/C Issuer its Pro
Rata Share thereof on demand of the Administrative Agent, plus
interest thereon from the date of such demand to the date such
amount is returned by such Lender, at a rate per annum equal to the
Federal Funds Rate from time to time in effect.
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(e) Obligations Absolute . The
obligation of the Company to reimburse the relevant L/C Issuer for
each drawing under each Letter of Credit issued by it and to repay
each L/C Borrowing shall be absolute, unconditional and
irrevocable, and shall be paid strictly in accordance with the
terms of this Agreement under all circumstances, including the
following:
(i)
any lack of validity or enforceability of such Letter of Credit,
this Agreement, or any other agreement or instrument relating
thereto;
(ii) the existence of any claim, counterclaim,
setoff, defense or other right that any Loan Party may have at any
time against any beneficiary or any transferee of such Letter of
Credit (or any Person for whom any such beneficiary or any such
transferee may be acting), the relevant L/C Issuer or any other
Person, whether in connection with this Agreement, the transactions
contemplated hereby or by such Letter of Credit or any agreement or
instrument relating thereto, or any unrelated
transaction;
(iii) any draft, demand, certificate or other
document presented under such Letter of Credit proving to be
forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect; or any
loss or delay in the transmission or otherwise of any document
required in order to make a drawing under such Letter of
Credit;
(iv) any payment by the relevant L/C Issuer
under such Letter of Credit against presentation of a draft or
certificate that does not strictly comply with the terms of such
Letter of Credit; or any payment made by the relevant L/C Issuer
under such Letter of Credit to any Person purporting to be a
trustee in bankruptcy, debtor-in-possession, assignee for the
benefit of creditors, liquidator, receiver or other representative
of or successor to any beneficiary or any transferee of such Letter
of Credit, including any arising in connection with any proceeding
under any Debtor Relief Law;
(v)
any exchange, release or nonperfection of any Collateral, or any
release or amendment or waiver of or consent to departure from the
Guaranty or any other guarantee, for all or any of the Obligations
of any Loan Party in respect of such Letter of Credit;
or
(vi) any other circumstance or happening
whatsoever, whether or not similar to any of the foregoing,
including any other circumstance that might otherwise constitute a
defense available to, or a discharge of, any Loan
Party;
provided that the
foregoing shall not excuse any L/C Issuer from liability to the
Company to the extent of any direct damages (as opposed to
consequential damages, claims in respect of which are waived by the
Company to the extent permitted by applicable Law) suffered by the
Company that are caused by such L/C Issuer’s gross negligence
or willful misconduct when determining whether drafts and other
documents presented under a Letter of Credit comply with the terms
thereof.
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(f) Role of L/C Issuers . Each
Lender and the Company agree that, in paying any drawing under a
Letter of Credit, the relevant L/C Issuer shall not have any
responsibility to obtain any document (other than any sight draft,
certificates and documents expressly required by the Letter of
Credit) or to ascertain or inquire as to the validity or accuracy
of any such document or the authority of the Person executing or
delivering any such document. None of the L/C Issuers, any
Agent-Related Person nor any of the respective correspondents,
participants or assignees of any L/C Issuer shall be liable to any
Lender for (i) any action taken or omitted in connection herewith
at the request or with the approval of the Lenders or the Required
Lenders, as applicable; (ii) any action taken or omitted in
the absence of gross negligence or willful misconduct; or
(iii) the due execution, effectiveness, validity or
enforceability of any document or instrument related to any Letter
of Credit or Letter of Credit Application. The Company hereby
assumes all risks of the acts or omissions of any beneficiary or
transferee with respect to its use of any Letter of Credit;
provided that this assumption is not intended to, and shall
not, preclude the Company’s pursuing such rights and remedies
as it may have against the beneficiary or transferee at law or
under any other agreement. None of the L/C Issuers, any
Agent-Related Person, nor any of the respective correspondents,
participants or assignees of any L/C Issuer, shall be liable or
responsible for any of the matters described in clauses (i) through
(vi) of Section 2.03(e); provided that anything in such
clauses to the contrary notwithstanding, the Company may have a
claim against an L/C Issuer, and such L/C Issuer may be liable to
the Company, to the extent, but only to the extent, of any direct,
as opposed to consequential or exemplary, damages suffered by the
Company which the Company proves were caused by such L/C
Issuer’s willful misconduct or gross negligence or such L/C
Issuer’s willful or grossly negligent failure to pay under
any Letter of Credit after the presentation to it by the
beneficiary of a sight draft and certificate(s) strictly complying
with the terms and conditions of a Letter of Credit. In furtherance
and not in limitation of the foregoing, each L/C Issuer may accept
documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice
or information to the contrary, and no L/C Issuer shall be
responsible for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign a
Letter of Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, which may prove to be invalid or
ineffective for any reason.
(g) Cash Collateral . (i) If an
L/C Issuer has honored any full or partial drawing request under
any Letter of Credit and such drawing has resulted in an L/C
Borrowing and the conditions set forth in Section 4.02 to a
Revolving Credit Borrowing cannot then be met, (ii) if, as of
the Letter of Credit Expiration Date, any Letter of Credit may for
any reason remain outstanding and partially or wholly undrawn,
(iii) if any Event of Default occurs and is continuing and the
Administrative Agent or the Required Lenders, as applicable,
require the Company to Cash Collateralize the L/C Obligations
pursuant to Section 8.02(c) or (iv) an Event of Default
set forth under Section 8.01(f) or (g) occurs and is
continuing, then the Company shall Cash Collateralize the then
Outstanding Amount of all L/C Obligations (in an amount equal to
such Outstanding Amount determined as of the date of such L/C
Borrowing or the Letter of Credit Expiration Date, as the case may
be), and shall do so not later than 2:00 p.m., New York City time,
on (x) in the case of the immediately preceding clauses (i) through
(iii), (1) the
62
Business Day
that the Company receives notice thereof, if such notice is
received on such day prior to 12:00 noon, New York City time, or
(2) if clause (1) above does not apply, the Business Day
immediately following the day that the Company receives such notice
and (y) in the case of the immediately preceding clause (iv),
the Business Day on which an Event of Default set forth under
Section 8.01(f) or (g) occurs or, if such day is not a
Business Day, the Business Day immediately succeeding such day. For
purposes hereof, “ Cash Collateralize ” means to
pledge and deposit with or deliver to the Administrative Agent, for
the benefit of the relevant L/C Issuer and the Lenders, as
collateral for the L/C Obligations, cash or deposit account
balances (“ Cash Collateral ”) pursuant to
documentation in form and substance reasonably satisfactory to the
Administrative Agent and the relevant L/C Issuer (which documents
are hereby consented to by the Lenders). Derivatives of such term
have corresponding meanings. The Company hereby grants to the
Administrative Agent, for the benefit of the L/C Issuers and the
Lenders, a security interest in all such cash, deposit accounts and
all balances therein and all proceeds of the foregoing. Cash
Collateral shall be maintained in a Cash Collateral Account and may
be invested in readily available Cash Equivalents. If at any time
the Administrative Agent determines that any funds held as Cash
Collateral are subject to any right or claim of any Person other
than the Administrative Agent (on behalf of the Secured Parties) or
that the total amount of such funds is less than the aggregate
Outstanding Amount of all L/C Obligations, the Company will,
forthwith upon demand by the Administrative Agent, pay to the
Administrative Agent, as additional funds to be deposited and held
in the Cash Collateral Account, an amount equal to the excess of
(a) such aggregate Outstanding Amount over (b) the total
amount of funds, if any, then held as Cash Collateral that the
Administrative Agent reasonably determines to be free and clear of
any such right and claim. Upon the drawing of any Letter of Credit
for which funds are on deposit as Cash Collateral, such funds shall
be applied, to the extent permitted under applicable Law, to
reimburse the relevant L/C Issuer. To the extent the amount of any
Cash Collateral exceeds the then Outstanding Amount of such L/C
Obligations and so long as no Event of Default has occurred and is
continuing, the excess shall be refunded to the
Company.
(h) Letter of Credit Fees . The
Company shall pay to the Administrative Agent for the account of
each Revolving Credit Lender in accordance with its Pro Rata Share
a Letter of Credit fee for each Letter of Credit issued pursuant to
this Agreement equal to the Applicable Rate times the daily maximum
amount then available to be drawn under such Letter of Credit
(whether or not such maximum amount is then in effect under such
Letter of Credit if such maximum amount increases periodically
pursuant to the terms of such Letter of Credit). Such Letter of
Credit fees shall be computed on a quarterly basis in arrears. Such
Letter of Credit fees shall be due and payable on the last Business
Day of each March, June, September and December, commencing with
the first such date to occur after the issuance of such Letter of
Credit, on the Letter of Credit Expiration Date and thereafter on
demand. If there is any change in the Applicable Rate during any
quarter, the daily maximum amount of each Letter of Credit shall be
computed and multiplied by the Applicable Rate separately for each
period during such quarter that such Applicable Rate was in
effect.
(i) Fronting Fee and Documentary and
Processing Charges Payable to L/C Issuer. The Company shall pay
directly to each L/C Issuer for its own account a
63
fronting fee
with respect to each Letter of Credit issued by it equal to 0.125%
per annum (or such other amount as is agreed in a separate writing
between the relevant L/C Issuer and the Company) of the daily
maximum amount then available to be drawn under such Letter of
Credit (whether or not such maximum amount is then in effect under
such Letter of Credit if such maximum amount increases periodically
pursuant to the terms of such Letter of Credit). Such fronting fees
shall be computed on a quarterly basis in arrears. Such fronting
fees shall be due and payable on the last Business Day of each
March, June, September and December, commencing with the first such
date to occur after the issuance of such Letter of Credit, on the
Letter of Credit Expiration Date and thereafter on demand. In
addition, the Company shall pay directly to each L/C Issuer for its
own account the customary issuance, presentation, amendment and
other processing fees, and other standard costs and charges, of
such L/C Issuer relating to letters of credit as from time to time
in effect. Such customary fees and standard costs and charges are
due and payable within ten (10) Business Days of demand and are
nonrefundable.
(j) Conflict with Letter of Credit
Application. Notwithstanding anything else to the contrary in
this Agreement, in the event of any conflict between the terms
hereof and the terms of any Letter of Credit Application, the terms
hereof shall control.
(k) Reporting . Each L/C Issuer
will report in writing to the Administrative Agent (i) on the first
Business Day of each calendar month, the aggregate face amount of
Letters of Credit issued by it and outstanding as of the last
Business Day of the preceding calendar month (and on such other
dates as the Administrative Agent may request), (ii) on or
prior to each Business Day on which such L/C Issuer expects to
issue, amend, renew or extend any Letter of Credit, the date of
such issuance or amendment, and the aggregate face amount of
Letters of Credit to be issued, amended, renewed or extended by it
and outstanding after giving effect to such issuance, amendment,
renewal or extension (and such L/C Issuer shall advise the
Administrative Agent on such Business Day whether such issuance,
amendment, renewal or extension occurred and whether the amount
thereof changed), (iii) on each Business Day on which such L/C
Issuer makes any L/C Disbursement, the date and amount of such L/C
Disbursement and (iv) on any Business Day on which the Company
fails to reimburse an L/C Disbursement required to be reimbursed to
such L/C Issuer on such day, the date and amount of such
failure.
(l) Addition of an L/C Issuer . A
Revolving Credit Lender or an Affiliate thereof may become an
additional L/C Issuer hereunder pursuant to a written agreement
among the Company, the Administrative Agent and such Revolving
Credit Lender. The Administrative Agent shall notify the Revolving
Credit Lenders of any such additional L/C Issuer.
(m) Letter of Credit Amounts .
Unless otherwise specified herein, the amount of a Letter of Credit
at any time shall be deemed to be the stated amount of such Letter
of Credit in effect at such time; provided , however
, that with respect to any Letter of Credit that, by its terms or
the terms of any document related thereto, provides for one or more
automatic increases in the stated amount thereof, the amount of
such Letter of Credit shall be deemed to be the maximum stated
amount of such Letter of Credit after
64
giving effect
to all such increases, whether or not such maximum stated amount is
in effect at such time.
SECTION 2.04. Swing Line Loans .
(a) The Swing Line . Subject to the terms and
conditions set forth herein, the Swing Line Lender agrees to make
loans (each such loan, a “ Swing Line Loan ”) to
the Company from time to time on any Business Day (other than the
Closing Date) until the Maturity Date in respect of the Revolving
Credit Facility in an aggregate amount not to exceed at any time
outstanding the amount of the Swing Line Sublimit, notwithstanding
the fact that such Swing Line Loans, when aggregated with the Pro
Rata Share of the Outstanding Amount of Revolving Credit Loans and
L/C Obligations of the Lender acting as Swing Line Lender, may
exceed the amount of such Lender’s Revolving Credit
Commitment; provided that, after giving effect to any Swing
Line Loan, the aggregate Outstanding Amount of the Revolving Credit
Loans of any Lender, plus such Lender’s Pro Rata Share of the
Outstanding Amount of all L/C Obligations, plus such Lender’s
Pro Rata Share of the Outstanding Amount of all Swing Line Loans
shall not exceed such Lender’s Revolving Credit Commitment
then in effect; provided, further, that the Company shall
not use the proceeds of any Swing Line Loan to refinance any
outstanding Swing Line Loan. Within the foregoing limits, and
subject to the other terms and conditions hereof, the Company may
borrow under this Section 2.04, prepay under
Section 2.05, and reborrow under this Section 2.04. Each
Swing Line Loan shall be a Base Rate Loan. Immediately upon the
making of a Swing Line Loan, each Revolving Credit Lender shall be
deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the Swing Line Lender a risk participation in such
Swing Line Loan in an amount equal to the product of such
Lender’s Pro Rata Share times the amount of such Swing Line
Loan.
(b) Borrowing Procedures. Each
Swing Line Borrowing shall be made upon the Company’s
irrevocable notice to the Swing Line Lender with a copy to the
Administrative Agent, which may be given by telephone. Each such
notice must be received by the Swing Line Lender with a copy to the
Administrative Agent not later than 1:00 p.m. on the requested
borrowing date, and shall specify (i) the amount to be borrowed,
which shall be a minimum of $100,000 (and any amount in excess of
$100,000 shall be an integral multiple of $25,000), and
(ii) the requested borrowing date, which shall be a Business
Day. Each such telephonic notice must be confirmed promptly by
delivery to the Swing Line Lender with a copy to the Administrative
Agent of a written Swing Line Loan Notice, appropriately completed
and signed by a Responsible Officer of the Company. Promptly after
receipt by the Swing Line Lender of any telephonic Swing Line Loan
Notice, the Swing Line Lender will confirm with the Administrative
Agent (by telephone or in writing) that the Administrative Agent
has also received such Swing Line Loan Notice and, if not, the
Swing Line Lender will notify the Administrative Agent (by
telephone or in writing) of the contents thereof. Unless the Swing
Line Lender has received notice (by telephone or in writing) from
the Administrative Agent (including at the request of any Revolving
Credit Lender) prior to 2:00 p.m. on the date of the proposed Swing
Line Borrowing (A) directing the Swing Line Lender not to make such
Swing Line Loan as a result of the limitations set forth in the
first proviso to the first sentence of Section 2.04(a), or
(B) that one or more of the applicable conditions specified in
Section 4.02 is not then satisfied, then, subject to the terms
and conditions hereof, the
65
Swing Line
Lender will, not later than 3:00 p.m. on the borrowing date
specified in such Swing Line Loan Notice, make the amount of its
Swing Line Loan available to the Company.
(c) Refinancing of Swing Line
Loans. (i) The Swing Line Lender at any time in its sole
and absolute discretion may request, on behalf of the Company
(which hereby irrevocably authorizes the Swing Line Lender to so
request on its behalf), that each Revolving Credit Lender make a
Base Rate Loan in an amount equal to such Lender’s Pro Rata
Share of the amount of Swing Line Loans then outstanding. Such
request shall be made in writing (which written request shall be
deemed to be a Loan Notice for purposes hereof) and in accordance
with the requirements of Section 2.02, without regard to the
minimum and multiples specified therein for the principal amount of
Base Rate Loans, but subject to the unutilized portion of the
aggregate Revolv
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