CREDIT AGREEMENT Dated as of September 22, 2008 among

Exhibit 10.14

 

$150,000,000

CREDIT AGREEMENT

Dated as of September 22, 2008

among

CT TECHNOLOGIES INTERMEDIATE HOLDINGS, INC.,

as Borrower,

THE OTHER CREDIT PARTIES SIGNATORY HERETO,

as Credit Parties,

THE LENDERS SIGNATORY HERETO FROM TIME TO TIME,

as Lenders,

and

GENERAL ELECTRIC CAPITAL CORPORATION,

as Agent and Collateral Agent

NEWSTAR FINANCIAL, INC.,

as Co-Lead Arranger, Syndication Agent and Joint Bookrunner

THE GOVERNOR AND COMPANY OF THE BANK OF IRELAND,

MARANON CAPITAL, L.P., and

ARES CAPITAL CORPORATION,

each as a Co-Documentation Agent

¿¿¿

GE CAPITAL MARKETS, INC.,

as Co-Lead Arranger and Joint Bookrunner

 

Table of Contents

 

 

(i)

Table of Contents

(continued)

 

 

(ii)

Table of Contents

(continued)

 

 

(iii)

INDEX OF APPENDICES

 

 

(iv)

 

(v)

THIS CREDIT AGREEMENT (this “ Agreement ”), dated as of September 22, 2008, among CT TECHNOLOGIES INTERMEDIATE HOLDINGS, INC., a Delaware corporation, the other Credit Parties signatory hereto; GENERAL ELECTRIC CAPITAL CORPORATION , a Delaware corporation (in its individual capacity, “ GE Capital ”), as a Lender, as Agent and as Collateral Agent for Lenders; and the other Lenders signatory hereto from time to time.

RECITALS

WHEREAS , Borrower has requested that Lenders extend revolving and term credit facilities to Borrower of up to One Hundred Fifty Million Dollars ($150,000,000) in the aggregate for the purpose of financing the Acquisition and the Refinancing, and to provide (a) working capital financing for Borrower, (b) funds for other general corporate purposes of Borrower, including permitted investments, acquisitions and capital expenditures, and (c) funds for fees and other expenses associated with the making of the Loans hereunder and the Related Transactions; and for these purposes, Lenders are willing to make certain loans and other extensions of credit to Borrower of up to such amount upon the terms and conditions set forth herein; and

WHEREAS , Borrower may, from time to time, request certain incremental term credit facilities pursuant to the terms and conditions set forth herein in an amount not to exceed Twenty Million Dollars ($20,000,000) in the aggregate; and

WHEREAS , Borrower has agreed to secure all of its obligations under the Loan Documents by granting to Collateral Agent, for the benefit of itself and the other Lenders, security interests in and liens upon substantially all of its existing and after-acquired personal and fee-owned real property, including, without limitation, a pledge of all of the Stock (as defined herein) of each of Borrower’s Subsidiaries, subject to the limitations set forth herein; and

WHEREAS , Borrower is a direct wholly-owned Subsidiary of CT Technologies Intermediate Holdings (Topco), Inc., a Delaware corporation (“ Holdings ”) and Holdings has agreed to guarantee all the obligations of Borrower under the Loan Documents pursuant to the Holdings Guaranty and by granting to Collateral Agent, for the benefit of itself and the other Lenders, security interests in and liens upon all of its existing and after-acquired property including, without limitation, a pledge of all of the Stock of Borrower to secure such guaranty; and

WHEREAS , all Domestic Subsidiaries of Borrower are willing to guarantee all of the obligations of Borrower to Agent and Lenders under the Loan Documents pursuant to the Subsidiary Guaranty and by granting to Collateral Agent, for the benefit of itself and the other Lenders, security interests in and liens upon substantially all of its existing and after-acquired personal and certain of its fee-owned real property to secure such guaranty; and

WHEREAS , capitalized terms used in this Agreement shall have the respective meanings ascribed to them in Annex A and, for purposes of this Agreement and the other Loan Documents, the rules of construction set forth in Annex A shall govern. All Annexes , Disclosure Schedules , Exhibits and other attachments (collectively, “ Appendices ”) hereto, or expressly identified to this Agreement, are incorporated herein by reference, and taken together with this Agreement, shall constitute but a single agreement. These Recitals shall be construed as part of the Agreement.

 

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NOW, THEREFORE , in consideration of the premises and the mutual covenants hereinafter contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

 

I.	AMOUNT AND TERMS OF CREDIT

1.1 Credit Facilities .

(a) Revolving Credit Facility .

(i) Subject to the terms and conditions hereof, each Revolving Lender agrees to make available to Borrower from time to time until the Revolving Credit Maturity Date its Pro Rata Share of advances (each, a “ Revolving Credit Advance ”). The Pro Rata Share of the Revolving Loan of any Revolving Lender shall not at any time exceed its separate Revolving Loan Commitment. The obligations of each Revolving Lender hereunder to make its share of the Revolving Credit Advances shall be several and not joint. Until the Revolving Credit Maturity Date, Borrower may from time to time borrow, repay and reborrow under this Section 1.1(a) ; provided , however, that after giving effect to each Revolving Credit Advance, the aggregate principal amount of all outstanding Revolving Loans and outstanding Swing Line Loans shall not exceed the Maximum Amount. Each Revolving Credit Advance shall be made on notice by Borrower to one of the representatives of Agent identified in Disclosure Schedule (1.1(a)) at the address specified therein. Any such notice must be given no later than (1) 10:00 a.m. (New York time) on the Business Day of the proposed Revolving Credit Advance, in the case of an Index Rate Loan, or (2) 10:00 a.m. (New York time) on the date which is three (3) Business Days prior to the proposed Revolving Credit Advance, in the case of a LIBOR Loan. Each such notice (a “ Notice of Revolving Credit Advance ”) must be given in writing or by telephonic notice confirmed in writing, each such writing or confirmation shall be sent by telecopy or overnight courier and be substantially in the form of Exhibit 1.1(a)(i) , and shall include the information required in such exhibit. If Borrower desires to have the Revolving Credit Advances bear interest by reference to LIBOR, Borrower must comply with Section 1.5(e) .

(ii) Except as provided in Section 1.10 , Borrower shall execute and deliver to Agent for each Revolving Lender that requests a note a note to evidence the Revolving Loan Commitment of that Revolving Lender. Each note shall be in the principal amount of the Revolving Loan Commitment of the applicable Revolving Lender, dated the Closing Date and substantially in the form of Exhibit 1.1(a)(ii) (each a “ Revolving Note ” and, collectively, the “ Revolving Notes ”). Each Revolving Note shall represent the obligation of Borrower to pay the amount of the applicable Revolving Lender’s Revolving Loan Commitment or, if less, such Revolving Lender’s Pro Rata Share of the aggregate unpaid principal amount of all Revolving Credit Advances together with interest thereon as prescribed in Section 1.5 . The entire unpaid balance of the aggregate Revolving Loan and all other non-contingent Obligations relating to the Revolving Loan shall be immediately due and payable in full in immediately available funds on the Revolving Credit Maturity Date.

 

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(iii) Each payment of principal with respect to the Revolving Credit Advances shall be paid to Agent for the ratable benefit of each Revolving Lender, ratably in proportion to each such Revolving Lender’s respective Revolving Loan Commitment.

(b) Term Loans .

(i) Term Loan.

(A) Subject to the terms and conditions hereof, each Term Loan Lender agrees to make a term loan (collectively, the “ Term Loan ”) on the Closing Date to Borrower in the original principal amount of that Lender’s Term Loan Commitment. The obligations of each Term Loan Lender hereunder to make its share of the Term Loan shall be several and not joint. Except as provided in Section 1.10 , each Term Loan Lender’s Pro Rata Share of the Term Loan shall be evidenced by a promissory note substantially in the form of Exhibit 1.1(b)(i) executed by Borrower in favor of such Term Loan Lender (each a “ Term Loan Note ” and collectively the “ Term Loan Notes ”). Each Term Loan Note shall represent the obligation of Borrower to pay the Term Loan made by the applicable Term Loan Lender, together with interest thereon as prescribed in Section 1.5 .

(B) The outstanding principal balance of the Term Loan shall be repaid in consecutive quarterly installments on the last Business Day of each Fiscal Quarter in the respective amounts during the periods set forth below, subject to Section 1.3 :

 

 

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(C) No payment with respect to the Term Loan may be re-borrowed.

(D) Each payment of principal with respect to the Term Loan shall be paid to Agent for the ratable benefit of each Term Loan Lender, ratably in proportion to such Term Loan Lender’s respective Term Loan Commitment.

(c) Incremental Facility .

(i) Subject to the terms and conditions of this Agreement, Borrower may, from time to time, request that the Lenders or other financial institutions that would be Qualified Assignees provide additional commitments up to an aggregate amount not in excess of Twenty Million Dollars ($20,000,000) (the “ Incremental Facility ”); provided , however , that (A) Borrower shall have given Agent at least fifteen (15) days’ advance written notice of its intention to obtain the Incremental Facility, the desired amount of the Incremental Facility and the intended Incremental Facility Effective Date (as hereinafter defined), (B) all conditions precedent set forth in Section 2.2 shall have been satisfied as of the Incremental Facility Effective Date, (C) Agent shall have received on or prior to the Incremental Facility Effective Date (1) a Certificate certifying the resolutions of such Person’s board of directors (or equivalent governing body) approving and authorizing the Incremental Facility to the extent of the stated desired amount of such Incremental Facility, (2) a Notice of Incremental Facility Commitment in the form of Exhibit 1.1(c)(1) attached hereto, duly executed by Borrower and the other Credit Parties (a “ Notice of Incremental Facility Commitment ”), (3) except as provided in Section 1.10 , Notes duly executed by Borrower in favor of each of the Lenders with an Incremental Facility Commitment dated the applicable Incremental Facility Effective Date and substantially in the form of Exhibit 1.1(c)(2) (each, an “ Incremental Facility Note ” and, collectively, the “ Incremental Facility Notes ”), (4) an opinion of counsel to the Credit Parties in form and substance and from counsel reasonably satisfactory to Agent and addressed to Agent dated the Incremental Facility Effective Date and addressing such matters as Agent may reasonably request, and (5) to the extent any of the proceeds are to be used for purposes other than Permitted Acquisitions or investments by Borrower or any Guarantor as expressly permitted under Section 6.2 hereof, the prior written consent of the Requisite Lenders, (D) each Incremental Facility Advance shall be in a minimum principal amount of $5,000,000, (E) the Total Leverage Ratio for Holdings and its Subsidiaries on a consolidated basis for the most recently ended Rolling Period shall be equal to or less than 5.00 to 1.00 before and after giving effect to such Incremental Facility Advances and the application of the proceeds thereof, including any related acquisition and (F) Borrower shall be in pro forma compliance with all Financial Covenants both before and after giving effect to such Incremental Facility Advances and the application of the proceeds thereof, including any related acquisition. An Incremental Facility Commitment shall take the form of (i) an increase of the Term Loan, and/or (ii) a new term loan which new term loan may be structured as a delayed draw term loan (“ New Term Loan ”).

 

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(ii) The maturity date for the Incremental Facility Advances shall be no earlier than the Term Loan Maturity Date. The average life to maturity of any New Term Loan shall be no shorter than the remaining average life to maturity of the existing Term Loan. Any Incremental Facility Commitment shall be governed by the related Notice of Incremental Facility Commitment, this Agreement and the other Loan Documents and in the case of New Term Loans, the interest rate margins shall not be more than 0.25% greater than the interest rate margins for any other existing Term Loan. In the event that interest rate margins on the New Term Loans is more than 0.25% greater than the interest rate margins for any other existing Term Loan, then the interest rate margins on such existing Term Loan shall be adjusted on a mark-to-market basis to the interest rate margins on the New Term Loan to maintain not more than 0.25% difference. Except for maturity and interest rate margins of a New Term Loan as described in the preceding two sentences, the terms and conditions of any New Term Loan shall be consistent with the terms of the existing Term Loan and otherwise reasonably satisfactory to the Agent. Amendments to this Agreement that are required to give effect to an Incremental Facility that is an increase of the Term Loan Commitment and Term Loan shall only require the consent of Borrower and Agent, except to the extent that a specific Lender’s consent is otherwise required with respect to an issuance by such Lender of any Incremental Facility Commitment.

(iii) Borrower shall offer the Incremental Facility to (A)  first , the Lenders, and each Lender will have the right, but not any obligation , to commit to all or a portion of the proposed Incremental Facility up to an amount no greater than its Pro Rata share of the existing Loans and Commitments hereunder; provided that any Lender that does not accept such offer within five (5) days shall be deemed to have rejected the offer and (B)  next , any institution that would be a Qualified Assignee; and any Lender or institution that would be a Qualified Assignee that accepts such offer must (x) be approved by Agent (which approval shall not be unreasonably withheld or delayed) and (y) execute the applicable Notice of Incremental Facility Commitment pursuant to which such Lender or Qualified Assignee shall agree to commit to all or a portion of such Incremental Facility and, in the case of such a Qualified Assignee that is not then a Lender, to be bound by the terms of this Agreement as a Lender. On the effective date provided for in a Notice of Incremental Facility Commitment (each a “ Incremental Facility Effective Date ”), the Commitments in question will be increased, as appropriate, by the additional amount(s) committed to by each Lender and each such Qualified Assignee on the Incremental Facility Effective Date in regard thereto. In the event there are Lenders and Qualified Assignees that have committed to the Incremental Facility in excess of the maximum amount requested (or permitted), then Agent and Borrower shall allocate such commitments (subject to clause (A) above). Subject to Sections 1.3(b), (c) and (d) , the Incremental Facility Loans that are New Term Loans shall be repaid as set forth in the related Notice of Incremental Facility Commitment.

(d) Swing Line Facility .

(i) Agent shall notify the Swing Line Lender upon Agent’s receipt of any Notice of Revolving Credit Advance. Subject to the terms and conditions hereof, the Swing Line Lender may, in its discretion, make available from time to time until the Termination Date

 

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advances (each, a “ Swing Line Advance ”) in accordance with any such notice. The provisions of this Section 1.1(d)  shall not relieve Revolving Lenders of their obligations to make Revolving Credit Advances under Section 1.1(a) ; provided that if the Swing Line Lender makes a Swing Line Advance pursuant to any such notice, such Swing Line Advance shall be in lieu of any Revolving Credit Advance that otherwise may be made by Revolving Credit Lenders pursuant to such notice. The aggregate amount of Swing Line Advances outstanding shall not exceed at any time the lesser of (A) the Swing Line Commitment and (B) the Maximum Amount less the outstanding balance of the Revolving Loan at such time (“ Swing Line Availability ”). Until the Termination Date, Borrower may from time to time borrow, repay and reborrow under this Section 1.1(d) . Each Swing Line Advance shall be made pursuant to a Notice of Revolving Credit Advance delivered by Borrower to Agent in accordance with Section 1.1(a) ; provided that any such notice must be given no later than 1:00 p.m. (New York time) on the Business Day of the proposed Swing Line Advance. The Swing Line Lender shall, subject to the conditions precedent set forth in Sections 2.2 , be entitled to fund Swing Line Advances, and to have such Revolving Lender make Revolving Credit Advances in accordance with Section 1.1(d)(iii) or purchase participating interests in accordance with Section 1.1(d)(iv) . Notwithstanding any other provision of this Agreement or the other Loan Documents, the Swing Line Loan shall constitute an Index Rate Loan.

(ii) Borrower shall execute and deliver to the Swing Line Lender a promissory note to evidence the Swing Line Commitment. Such note shall be in the principal amount of the Swing Line Commitment of the Swing Line Lender, dated the Closing Date and substantially in the form of Exhibit 1.1(d)(ii) (the “Swing Line Note”). The Swing Line Note shall represent the obligation of Borrower to pay the amount of the Swing Line Commitment or, if less, the aggregate unpaid principal amount of all Swing Line Advances made to Borrower together with interest thereon as prescribed in Section 1.5 . The entire unpaid balance of the Swing Line Loan shall be immediately due and payable in full in immediately available funds on the Termination Date if not sooner paid in full.

(iii) The Swing Line Lender, at any time and from time to time no less frequently than once weekly, shall on behalf of Borrower (and Borrower hereby irrevocably authorizes the Swing Line Lender to so act on its behalf) and Borrower may, at any time and from time to time, request each Revolving Lender (including the Swing Line Lender) to make a Revolving Credit Advance to Borrower (which shall be an Index Rate Loan) in an amount equal to that Revolving Lender’s Pro Rata Share of the principal amount of the Swing Line Loan (the “Refunded Swing Line Loan”) outstanding on the date such notice is given. Unless any of the events described in Sections 8.1(h) or 8.1(i) has occurred (in which event the procedures of Section 1.1(d)(iv) shall apply) and regardless of whether the conditions precedent set forth in this Agreement to the making of a Revolving Credit Advance are then satisfied, each Revolving Lender shall disburse directly to Agent, its Pro Rata Share of a Revolving Credit Advance on behalf of the Swing Line Lender, prior to 2:00 p.m. (New York time), in immediately available funds on the Business Day next succeeding the date that notice is given. The proceeds of those Revolving Credit Advances shall be immediately paid to the Swing Line Lender and applied to repay the Refunded Swing Line Loan.

(iv) If, prior to refunding a Swing Line Loan with a Revolving Credit Advance pursuant to Section 1.1(d)(iii) , one of the events described in Sections 8.1(h) or 8.1(i)

 

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has occurred, then, subject to the provisions of Section 1.1(d)(v) below, each Revolving Lender shall, on the date such Revolving Credit Advance was to have been made for the benefit of Borrower, purchase from the Swing Line Lender an undivided participation interest in the Swing Line Loan in an amount equal to its Pro Rata Share of such Swing Line Loan. Upon request, each Revolving Lender shall promptly transfer to the Swing Line Lender, in immediately available funds, the amount of its participation interest.

(v) Each Revolving Lender’s obligation to make Revolving Credit Advances in accordance with Section 1.1(d)(iii) and to purchase participation interests in accordance with Section 1.1(d)(iv) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right that such Revolving Lender may have against the Swing Line Lender, Borrower or any other Person for any reason whatsoever; (B) the occurrence or continuance of any Default or Event of Default; (C) any inability of Borrower to satisfy the conditions precedent to borrowing set forth in this Agreement at any time; or (D) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing. If any Revolving Lender does not make available to Agent or the Swing Line Lender, as applicable, the amount required pursuant to Sections 1.1(d)(iii) or 1.1(d)(iv) , as the case may be, the Swing Line Lender shall be entitled to recover such amount on demand from such Revolving Lender, together with interest thereon for each day from the date of non-payment until such amount is paid in full at the Federal Funds Rate for the first two Business Days and at the Index Rate thereafter.

(e) Reliance on Notices . Agent shall be entitled to rely upon, and shall be fully protected in relying upon, any Notice of Revolving Credit Advance, Notice of Conversion/Continuation, Notice of Incremental Facility Commitment or similar notice believed by Agent to be genuine. Agent may assume that each Person executing and delivering any notice in accordance herewith was duly authorized, unless the responsible individual acting thereon for Agent has actual knowledge to the contrary.

1.2 Letters of Credit . Subject to and in accordance with the terms and conditions contained herein and in Annex B , Borrower shall have the right to request, the L/C Issuer agrees to issue, and Revolving Lenders agree to incur, or purchase participations in, Letter of Credit Obligations in respect of Borrower.

1.3 Prepayments .

(a) Voluntary Prepayments; Reductions in Revolving Loan Commitments . Borrower may at any time, without premium or penalty (but subject to any applicable LIBOR funding breakage costs in accordance with Section 1.11(b)) , on at least three (3) Business Days’ prior written notice by Borrower to Agent (i) voluntarily prepay all or any part of the Revolving Loans then outstanding or the Term Loan then outstanding and/or (ii) permanently reduce (but not terminate) the Revolving Loan Commitments or Swing Line Commitment; provided that (A) any such prepayments of Term Loans or reductions of Revolving Loan Commitments shall be in a minimum amount of $1,000,000 and integral multiples of $100,000 in excess of such amount, (B) any such prepayments of Revolver Loans shall be in a minimum amount of $100,000 (other than Swing Line Loans for which prior written notice is not required and for which no minimum shall apply), (C) the Revolving Loan Commitments shall not be reduced to an amount less than

 

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the amount of the Revolving Loan then outstanding, and (D) after giving effect to such reductions, Borrower shall be in compliance with Section 1.3(b)(i) . In addition, Borrower may at any time on at least three (3) Business Days’ (or such shorter period acceptable to Agent) prior written notice by Borrower to Agent terminate the Revolving Loan Commitments; provided that upon the termination of the Revolving Loan Commitments, all other Commitments then in effect shall terminate and all Loans and other Obligations shall be immediately due and payable in full and all Letter of Credit Obligations shall be cash collateralized or otherwise satisfied in accordance with Annex B hereto. Any voluntary prepayment must be accompanied by payment of any applicable LIBOR funding breakage costs in accordance with Section 1.11(b) . Upon any such reduction or termination of the Revolving Loan Commitments, Borrower’s right to request Revolving Credit Advances, or request that Letter of Credit Obligations be incurred on its behalf, or request Swing Line Advances, shall simultaneously be permanently reduced or terminated, as the case may be; provided that a permanent reduction of the Revolving Loan Commitments shall not require a corresponding pro rata reduction in the L/C Sublimit. Each notice of partial prepayment shall designate the Loans or other Obligations to which such prepayment is to be applied; provided that any partial prepayments of the Term Loan pursuant to this Section 1.3(a) shall be applied, subject to Section 1.9(a) to prepay the scheduled installments of such Term Loan as indicated by the Borrower. Prepayments of the Incremental Facility Loans pursuant to this Section 1.3(a) shall be applied as set forth in the related Notice of Incremental Facility Commitment.

(b) Mandatory Prepayments .

(i) If at any time the outstanding balance of the Revolving Loan and the Swing Line Loan exceeds the Maximum Amount, subject to Section 1.9(a) , Borrower shall immediately repay the aggregate outstanding Revolving Credit Advances to the extent required to eliminate such excess. If any such excess remains after repayment in full of the aggregate outstanding Revolving Credit Advances, Borrower shall provide cash collateral for the Letter of Credit Obligations in the manner set forth in Annex B to the extent required to eliminate such excess.

(ii) On the first Business Day following the receipt by any Credit Party of Net Cash Proceeds of any asset disposition (excluding any proceeds from any insurance or condemnation proceedings and proceeds of Excluded Asset Dispositions) in excess of $1,000,000 in any twelve month period commencing after the Closing Date (when taken together with all other proceeds of asset dispositions (excluding any insurance or condemnation proceeds and proceeds of Excluded Asset Dispositions)), Borrower shall prepay the Obligations (including cash collateralizing the Letter of Credit Obligations), in an amount equal to all such Net Cash Proceeds. Any such prepayment shall be applied in accordance with Section 1.3(c) . Notwithstanding the foregoing, in the case of any asset disposition, if Borrower delivers to Agent at the time of the receipt of such Net Cash Proceeds, a Certificate stating that the applicable Credit Party intends to use all or any portion of the Net Cash Proceeds from such asset disposition within two hundred ten (210) days of receipt thereof to invest in Similar Assets or to make a Permitted Acquisition pursuant to Section 6.1 hereof, the applicable Credit Party may use such proceeds in the manner set forth in such Certificate; provided that (x) such Similar Assets or acquired assets will be owned by Borrower or a Guarantor (other than Holdings) or Person that becomes a Guarantor (other than Holdings), (y) no Default or Event of Default is then in

 

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existence or would result from such use, and (z) if such proceeds are not reinvested or used to consummate Permitted Acquisitions within two hundred ten (210) days as permitted hereunder, on the first Business Day immediately following such period, any amounts not so used within such period shall be applied to prepay Obligations as provided in Section 1.3(c) .

(iii) If any Credit Party or Parent issues any Stock (other than Stock of Parent issued to another Credit Party, to the Equity Investors or their Affiliates or co-investors, or Persons exercising preemptive rights in connection with an issuance of Stock to the Equity Investors or, so long as no Change of Control would occur after giving effect thereto, to employees in the ordinary course of business, or so long as no Default or Event of Default exists or would exist after giving effect thereto (x) to finance the repurchase of management equity or (y) to fund Capital Expenditures and Permitted Acquisitions pursuant to Section 6.1) , or issues debt securities or incurs any Funded Debt (other than Indebtedness permitted by Section 6.3 hereof), no later than the Business Day following the date of receipt of the Net Cash Proceeds thereof, Borrower shall prepay the Obligations and/or cash collateralize the Letter of Credit Obligations in an amount equal to, with respect to any Stock issuances, 50% of all Net Cash Proceeds, and with respect to debt securities issuances or the incurrence of any Funded Debt, 100% of all such Net Cash Proceeds. Any such prepayment shall be applied in accordance with Section 1.3(c) .

(iv) Until the Termination Date, Borrower shall prepay the Obligations and/or cash collateralize the Letter of Credit Obligations on or prior to May 5 of each Fiscal Year (commencing on May 5, 2010 for the Fiscal Year ending December 31, 2009) in an amount equal to (A) for such Fiscal Years when Borrower has delivered to Agent evidence reasonably satisfactory to Agent that the Total Leverage Ratio of Borrower shall have been less than 3.50 to 1.0 for two (2) consecutive Fiscal Quarters during the immediately preceeding Fiscal Year, fifty percent (50%) of Excess Cash Flow for such Fiscal Year, and (B ) at all other times, seventy-five percent (75%) of Excess Cash Flow for the immediately preceding Fiscal Year. Any prepayments made pursuant to this clause (iv)  shall be applied in accordance with Section 1.3(c) . Each such prepayment shall be accompanied by a Certificate attaching the supporting calculations for such Excess Cash Flow prepayment.

(c) Application of Certain Mandatory Prepayments . Subject to Section 1.9(a) , any prepayments made by Borrower pursuant to Section 1.3(b)(ii), (b)(iii), (b)(iv) or 1.3(d) hereof shall be applied as follows: first , to repay the scheduled principal installments of the Term Loan and the New Term Loan, on a pro rata basis; second , to the principal balance of the Swing Line Loan until the same has been repaid in full; third , to the outstanding principal balance of Revolving Credit Advances until the same shall have been paid in full; fourth , with respect to any Letter of Credit Obligations, to provide cash collateral therefor in the manner set forth in Annex B , until all such Letter of Credit Obligations shall have been fully cash collateralized in the manner set forth in Annex B ; and fifth , to any other Obligations that are then due and payable until all such Obligations shall have been paid in full. The Revolving Loan Commitments and the Swing Line Commitment shall be permanently reduced by the amount of any such prepayments unless otherwise agreed to by Agent.

 

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(d) Application of Prepayments from Insurance Proceeds and Condemnation Proceeds . Prepayments from casualty insurance or condemnation Net Cash Proceeds, including business interruption insurance Net Cash Proceeds in excess of $12,500,000 in the aggregate, in accordance with Section 5.4(c) , shall be applied as set forth in Section 1.3(c) . Notwithstanding the foregoing, if Borrower delivers to Agent a Certificate stating that the applicable Credit Party intends to use all or any portion of such insurance or condemnation proceeds (excluding business interruption proceeds) within two hundred ten (210) days of receipt thereof to repair or replace the assets the loss, destruction, or condemnation of which gave rise to such proceeds or to invest in Similar Assets, the applicable Credit Party may use such proceeds in the manner set forth in such Certificate; provided that (x) such replacement assets or Similar Assets will be owned by Borrower or a Guarantor (other than Holdings), (y) no Default or Event of Default arising under Section 8.1(a), (b), (h) or (i) is then in existence or would result from such reinvestment, and (z) any Net Cash Proceeds not so used in the period set forth in such Certificate shall, on the first Business Day immediately following such period, be applied to prepay Obligations and/or cash collateralize the Letter of Credit Obligations as set forth in Section 1.3(c) .

(e) No Implied Consent . Nothing in this Section 1.3 shall be construed to constitute Agent’s, Collateral Agent’s or any Lender’s consent to any transaction that is not permitted by other provisions of this Agreement or the other Loan Documents.

1.4 Use of Proceeds . Borrower shall utilize (a) the proceeds of the Term Loan solely for the Acquisition (and to pay any related transaction expenses) and the Refinancing, (b) the proceeds of Revolving Loans to finance the Credit Parties’ working capital and general corporate needs, including the payment of fees and expenses incurred hereunder, (c) the proceeds of the Loans to make any acquisitions, investments, loans or advances in each case permitted under Section 6.1 or Section 6.2 hereof and (d) subject to the requirements of Section 1.1(c)(i) , the proceeds of any Incremental Facility Loans to finance Permitted Acquisitions, investments permitted under Section 6.2 and for other working capital and general corporate purposes of the Credit Parties. Disclosure Schedule (1.4)  contains a description of Borrower’s sources and uses of funds as of the Closing Date, including Loans and Letter of Credit Obligations to be made or incurred on that date, and a funds flow memorandum detailing how funds from each source are to be transferred to particular uses. None of the Loan proceeds or Letters of Credit shall be used in violation of Section 3.10 .

1.5 Interest and Applicable Margins .

(a) Borrower shall pay interest to Agent, for the ratable benefit of Lenders in accordance with the various Loans being made by each Lender, in arrears on each applicable Interest Payment Date, at the following rates: (i) with respect to the Revolving Credit Advances, the Index Rate plus 4.00% per annum or, at the election of Borrower, the applicable LIBOR plus 5.00% per annum; (ii) with respect to the Term Loan, subject to Section 1.1(c)(ii) , the Index Rate plus 4.00% per annum or, at the election of Borrower, the applicable LIBOR plus 5.00% per annum; (iii) with respect to any Incremental Facility that is a New Term Loan, the interest rates set forth in the applicable Notice of Incremental Facility Commitment; and (iv) with respect to the Swing Line Loan, the Index Rate plus 4.00% per annum.

(b) If any payment of principal, interest, Fees or other amounts on or in respect of any of the Commitments, the Loans or the other Obligations becomes due and payable on a day other than a Business Day, the due date thereof will be extended to the next succeeding

 

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Business Day (except as set forth in the definition of LIBOR Period) and, with respect to payments of principal or interest thereon shall be payable at the then applicable rate during such extension. The foregoing shall not be given effect, however, in respect of the calculation of Financial Covenants relating to scheduled principal and interest payments.

(c) All computations of (i) Fees calculated on a per annum basis and interest with respect to LIBOR Loans shall be made by Agent on the basis of a 360-day year and (ii) interest with respect to Index Rate Loans shall be made by Agent on the basis of a 365/366-day year, in each case for the actual number of days occurring in the period for which such interest and Fees are payable. The Index Rate is a floating rate determined for each day. Each determination by Agent of an interest rate and Fees hereunder shall be final, binding and conclusive on all Credit Parties, absent manifest error.

(d) So long as an Event of Default has occurred and is continuing under Section 8.1(a), (h) or (i) , or so long as any other Event of Default has occurred and is continuing and at the election of Agent (or upon the written request of the Requisite Lenders) confirmed by written notice from Agent or Collateral Agent to Borrower, the interest rates applicable to the Loans and the Letter of Credit Fees shall be increased by two percentage points (2%) per annum above the rates of interest or the rate of such Letter of Credit Fees otherwise applicable hereunder (“ Default Rate ”), and all outstanding Obligations shall bear interest at the Default Rate applicable to such Obligations. Interest and Letter of Credit Fees at the Default Rate shall accrue from the initial date of such Event of Default until that Event of Default is cured or waived and shall be payable upon demand.

(e) So long as no Default or Event of Default is continuing and neither the Agent nor the Requisite Lenders shall have determined in their sole discretion to suspend the Borrower’s LIBOR Loan option (if requested), Borrower shall have the option to (i) request that any Revolving Credit Advance or Incremental Facility Advance be made as a LIBOR Loan, (ii) convert at any time all or any part of outstanding Loans (other than the Swing Line Loan) from Index Rate Loans to LIBOR Loans, (iii) convert any LIBOR Loan to an Index Rate Loan, subject to payment of LIBOR breakage costs in accordance with Section 1.11(b) if such conversion is made prior to the expiration of the LIBOR Period applicable thereto, or (iv) continue all or any portion of any Loan (other than the Swing Line Loan) as a LIBOR Loan upon the expiration of the applicable LIBOR Period, in which event the succeeding LIBOR Period of that continued Loan shall commence on the first day after the last day of the LIBOR Period of the Loan to be continued. Any Loan or group of Loans having the same proposed LIBOR Period to be made or continued as, or converted into, a LIBOR Loan must be in a minimum amount of $250,000 and integral multiples of $50,000 in excess of such amount. Any such election must be made by 1:00 p.m. (New York time) on the 3rd Business Day prior to (1) the date of any proposed Revolving Credit Advance, Term Loan or Incremental Facility Advance which is to bear interest at LIBOR, (2) the end of each LIBOR Period with respect to any LIBOR Loans to be continued as such, or (3) the date on which Borrower wishes to convert any Index Rate Loan to a LIBOR Loan for a LIBOR Period designated by Borrower in such election, as applicable. If no election is received with respect to a LIBOR Loan by 1:00 p.m. (New York time) on the 3rd Business Day prior to the end of the LIBOR Period with respect thereto (or if a Default or an Event of Default has occurred and is continuing), that LIBOR Loan shall be converted to an Index Rate Loan at the end of its LIBOR Period. Borrower must make such election by notice to Agent in writing, by

 

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telecopy or overnight courier; provided that any such notice may be made telephonically so long as the Agent receives written confirmation of such telephonic notice within three (3) Business Days thereafter. In the case of any conversion or continuation, such election must be made pursuant to a written notice (or written confirmation in the case of a telephonic notice) (a “ Notice of Conversion/Continuation ”) in the form of Exhibit 1.5(e) .

(f) Notwithstanding anything to the contrary set forth in this Section 1.5 , if a court of competent jurisdiction determines in a final order that the rate of interest payable hereunder exceeds the highest rate of interest permissible under law (the “ Maximum Lawful Rate ”), then so long as the Maximum Lawful Rate would be so exceeded, the rate of interest payable hereunder shall be equal to the Maximum Lawful Rate; provided , however , that if at any time thereafter the rate of interest payable hereunder is less than the Maximum Lawful Rate, Borrower shall continue to pay interest hereunder at the Maximum Lawful Rate until such time as the total interest received by Agent, on behalf of Lenders, is equal to the total interest that would have been received had the interest rate payable hereunder been (but for the operation of this paragraph) the interest rate payable since the Closing Date as otherwise provided in this Agreement. Thereafter, interest hereunder shall be paid at the rate(s) of interest and in the manner provided in Section 1.5(a) through (e) , unless and until the rate of interest again exceeds the Maximum Lawful Rate, and at that time this paragraph shall again apply. In no event shall the total interest received by any Lender pursuant to the terms hereof exceed the amount that such Lender could lawfully have received had the interest due hereunder been calculated for the full term hereof at the Maximum Lawful Rate. If the Maximum Lawful Rate is calculated pursuant to this paragraph, such interest shall be calculated at a daily rate equal to the Maximum Lawful Rate divided by the number of days in the year in which such calculation is made. If, notwithstanding the provisions of this Section 1.5(f) , a court of competent jurisdiction shall finally determine that a Lender has received interest hereunder in excess of the Maximum Lawful Rate, Agent shall, to the extent permitted by applicable law, promptly apply such excess in the order specified in Section 1.9 and thereafter shall refund any excess to Borrower or as a court of competent jurisdiction may otherwise order.

1.6 [Intentionally Omitted. ]

1.7 Fees .

(a) Borrower shall pay to GE Capital and NewStar Financial, Inc., respectively, the Fees specified in the Arranger Fee Letter at the times specified for payment therein.

(b) As additional compensation for the Revolving Lenders, Borrower shall pay to Agent, for the ratable benefit of the Revolving Lenders, in arrears, on the last Business Day of each calendar quarter prior to the Revolving Credit Maturity Date, a Fee for Borrower’s non-use of the Revolving Loan Commitments in an amount equal to one-half of one percent (0.500%) per annum (in each case calculated on the basis of a 360 day year for the actual days elapsed) multiplied by the difference between (1) the Revolving Loan Commitment and (2) the average for the period of the daily closing balances of the Revolving Loan and the Swing Line Loan outstanding during the period for which such Fee is due.

 

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(c) Borrower shall pay to Agent, for the ratable benefit of Revolving Lenders, the Letter of Credit Fee as provided in Annex B .

1.8 Receipt of Payments . Borrower shall make each payment under this Agreement not later than 2:00 p.m. (New York time) on the day when due in immediately available funds in Dollars to the Collection Account. For purposes of computing interest and Fees and determining Borrowing Availability as of any date, all payments shall be deemed received on the Business Day on which immediately available funds therefor are received in the Collection Account prior to 2:00 p.m. (New York time). Payments received after 2:00 p.m. (New York time) on any Business Day or on a day that is not a Business Day shall be deemed to have been received on the following Business Day.

1.9 Application and Allocation of Payments .

(a) So long as no Event of Default has occurred and is continuing, (i) payments matching specific scheduled payments then due shall be applied to those scheduled payments; (ii) voluntary prepayments shall be applied as determined by Borrower, subject to the provisions of Section 1.3(a) ; and (iii) mandatory prepayments shall be applied as set forth in Section 1.3(c) and Section 1.3(d) , as applicable. All payments and prepayments applied to a particular Loan shall be applied ratably to the portion thereof held by each Lender as determined by its Pro Rata Share. As to any other payment, and as to all payments made or proceeds of Collateral received when an Event of Default has occurred and is continuing or following the Revolving Credit Maturity Date (or, in the case of any payment relating to (x) the Term Loan, following the Term Loan Maturity Date and (y) an Incremental Facility, following the Incremental Facility Maturity Date), Borrower hereby irrevocably waives the right to direct the application of any and all payments received from or on behalf of Borrower, and Borrower hereby irrevocably agrees that Agent or Requisite Lenders shall have the continuing exclusive right to apply any and all such payments and proceeds against the Obligations then due and payable of Borrower as Agent or Requisite Lenders may deem advisable in accordance with the terms of this Agreement notwithstanding any previous entry by Agent in the Loan Account or any other books and records. After the occurrence and during the continuance of an Event of Default, such payments and proceeds shall be applied to amounts then due and payable in the following order: (1) to Fees and Agent’s and Collateral Agent’s expenses reimbursable hereunder; (2) to accrued interest on the Swing Line Loan that is due and payable; (3) to principal payments on the Swing Line Loan; (4) to accrued interest on the Loans that is due and payable, ratably in proportion to the interest accrued as to each Loan; (5) to principal payments on the Loans and any Obligations under any Secured Rate Contract, ratably to the aggregate, combined principal balance of the other Loans, Obligations under any Secured Rate Contract; (6) to provide cash collateral for Letter of Credit Obligations in the manner described in Annex B ; and (7) to all other Obligations including expenses of Lenders to the extent reimbursable under Section 11.3 .

(b) Agent is authorized to, after prior notice to Borrower, and at its sole election may, charge to the Revolving Loan balance on behalf of Borrower and cause to be paid all Fees, expenses, Charges, costs (including insurance premiums in accordance with Section 5.4(a)) and interest and principal, other than principal of the Revolving Loan, owing by Borrower under this Agreement or any of the other Loan Documents if and to the extent

 

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Borrower fails to pay promptly any such amounts as and when due, even if the amount of such charges would exceed Borrowing Availability at such time. At Agent’s option and to the extent permitted by law, any charges so made shall constitute part of the Revolving Loan hereunder.

1.10 Loan Account and Accounting . Agent shall maintain a loan account (the “ Loan Account ”) on its books to record: all Loans; all payments made by Borrower; and all other debits and credits as provided in this Agreement with respect to the Loans or any other Obligations. All entries in the Loan Account shall be made in accordance with Agent’s customary accounting practices as in effect from time to time. The balance in the Loan Account, as recorded on Agent’s most recent printout or other written statement, shall, absent manifest error, be presumptive evidence of the amounts due and owing to Agent and Lenders by Borrower; provided that any failure to so record or any error in so recording shall not limit or otherwise affect Borrower’s duty to pay the Obligations. Agent shall render to Borrower a monthly accounting of transactions with respect to the Loans setting forth the balance of the Loan Account as to Borrower for the immediately preceding month. Unless Borrower notifies Agent in writing of any objection to any such accounting (specifically describing the basis for such objection), within thirty (30) days after the date on which Borrower receives such accounting, each and every such accounting shall, be presumptive evidence as to all matters reflected therein absent manifest error. Only those items expressly objected to in such notice shall be deemed to be disputed by Borrower. Notwithstanding any provision herein contained to the contrary, any Lender may elect (which election may be revoked) to dispense with the issuance of Notes to that Lender and may rely on the Loan Account as evidence of the amount of Obligations from time to time owing to it.

1.11 Indemnity .

(a) Each Credit Party that is a signatory hereto shall jointly and severally indemnify and hold harmless each of Agent, Collateral Agent, Lenders and their respective Affiliates, and each such Person’s respective officers, directors, members, managers, employees, attorneys, agents and representatives (each, an “ Indemnified Person ”), from and against any and all suits, actions, proceedings, claims, damages, losses, liabilities and reasonable related out of pocket expenses (including reasonable attorneys’ fees and disbursements and other costs of investigation or defense, including those incurred upon any appeal) that may be instituted or asserted against or incurred by any such Indemnified Person as the result of credit having been extended, suspended or terminated under this Agreement and the other Loan Documents and the administration of such credit, and in connection with or arising out of the transactions contemplated hereunder and thereunder and any actions or failures to act in connection therewith, including any and all Environmental Liabilities and legal costs and expenses arising out of or incurred in connection with disputes between or among any parties to any of the Loan Documents (collectively, “ Indemnified Liabilities ”); provided , that no such Credit Party shall be liable for (i) any indemnification to an Indemnified Person to the extent that any such suit, action, proceeding, claim, damage, loss, liability or expense results from that Indemnified Person’s gross negligence or willful misconduct as finally determined by a court of competent jurisdiction, (ii) any disputes arising strictly between or among Agent, Collateral Agent and/or any Lenders (other than Sponsor) unrelated to any acts or omissions of any Credit Party, or (iii) more than one counsel to all Indemnified Persons absent an actual or potential bona fide conflict of interest. NO INDEMNIFIED PERSON SHALL BE RESPONSIBLE OR LIABLE TO ANY

 

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OTHER PARTY TO ANY LOAN DOCUMENT, ANY SUCCESSOR, ASSIGNEE OR THIRD PARTY BENEFICIARY OF SUCH PERSON OR ANY OTHER PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH SUCH PARTY, FOR INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A RESULT OF CREDIT HAVING BEEN EXTENDED, SUSPENDED OR TERMINATED UNDER ANY LOAN DOCUMENT OR AS A RESULT OF ANY OTHER TRANSACTION CONTEMPLATED HEREUNDER OR THEREUNDER. No Indemnified Person shall be liable for any damages arising from the use by others of any information or other materials obtained through IntraLinks or other similar information transmission systems in connection with this Agreement, except to the extent such damages arise from such Indemnified Person’s gross negligence or willful misconduct as finally determined by a court of competent jurisdiction, and no Indemnified Person shall have any liability for any indirect or consequential damages relating to this Agreement or any other Loan Document or arising out of its activities in connection herewith or therewith (whether before or after the Closing Date).

(b) To induce Lenders to provide the LIB OR option on the terms provided herein, if (i) any LIBOR Loans are repaid in whole or in part prior to the last day of any applicable LIBOR Period (whether that repayment is made pursuant to any provision of this Agreement (except for mandatory prepayments made pursuant to Section 1.3(b) and (d)  hereof) or any other Loan Document or occurs as a result of acceleration, by operation of law or otherwise); (ii) Borrower shall default in payment when due of the principal amount of or interest on any LIBOR Loan; (iii) Borrower shall refuse to accept any borrowing of, or shall request a termination of any borrowing, conversion into or continuation of LIBOR Loans after Borrower has given written notice requesting the same in accordance herewith; or (iv) Borrower shall fail to make any prepayment of a LIBOR Loan after Borrower has given a notice thereof in accordance herewith, then Borrower shall indemnify and hold harmless each Lender from and against all losses, costs and expenses resulting from or arising from any of the foregoing. Such indemnification shall include any loss (including loss of margin) or expense arising from the reemployment of funds obtained by it or from fees payable to terminate deposits from which such funds were obtained. For the purpose of calculating amounts payable to a Lender under this subsection, each Lender shall be deemed to have actually funded its relevant LIBOR Loan through the purchase of a deposit bearing interest at LIBOR in an amount equal to the amount of that LIBOR Loan and having a maturity comparable to the relevant LIBOR Period; provided , that each Lender may fund each of its LIBOR Loans in any manner it sees fit, and the foregoing assumption shall be utilized only for the calculation of amounts payable under this subsection. This covenant shall survive the termination of this Agreement and the payment of the Notes and all other amounts payable hereunder. As promptly as practicable under the circumstances, each Lender shall provide Borrower with its written calculation of all amounts payable pursuant to this Section 1.11(b) , and such calculation shall be binding on the parties hereto unless Borrower shall object in writing within ten (10) Business Days of receipt thereof, specifying the basis for such objection in detail.

1.12 Access . Each Credit Party that is a party hereto shall, during normal business hours, from time to time upon at least three (3) Business Day’s prior notice but not more than once during any Fiscal Year so long as no Event of Default has occurred and is continuing, but if an Event of Default occurs and is continuing, then as frequently as Agent or Requisite Lenders determine to be appropriate: (a) provide Agent and any of its officers,

 

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members, managers, employees and agents access to its properties, facilities, advisors and employees (including officers) with an officer present of each Credit Party and to the Collateral, (b) permit Agent, and any of its officers, members, managers, employees and agents, to inspect, audit and make extracts from any Credit Party’s books and records, and (c) permit Agent, and its officers, members, managers, employees and agents, to inspect, review, evaluate the Collateral, including without limitation, during an Event of Default, making test verifications and counts of the Accounts, in the Credit Parties’ names. Each such Credit Party irrevocably makes, constitutes and appoints Agent (and all officers, employees or agents designated by Agent), so long as any Event of Default has occurred and is continuing, as such Credit Party’s true and lawful agent and attorney-in-fact for the purpose of making such test verifications and counts of the Accounts. Representatives of other Lenders may accompany Agent’s or Collateral Agent’s representatives on such inspections, audits or accountings at no charge to Borrower. Notwithstanding the foregoing, no Credit Party shall be required to provide the Agent and Collateral Agent with access to patient medical records or any other information which is confidential pursuant to any laws, rules, regulations, decrees and orders of any Governmental Authority except as set forth in Section (p) of Annex E .

1.13 Taxes .

(a) Any and all payments by Borrower hereunder or under the Notes shall be made, in accordance with this Section 1.13 , free and clear of and without deduction for any and all present or future Taxes. If Borrower shall be required by law to deduct any Taxes from or in respect of any sum payable hereunder or under the Notes, (i) the sum payable shall be increased as much as shall be necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section 1.13) Agent or Lenders, as applicable, receive an amount equal to the sum they would have received had no such deductions been made, (ii) Borrower shall make such deductions, and (iii) Borrower shall pay the full amount deducted to the relevant taxing or other authority in accordance with applicable law. Within thirty (30) days after the date of any payment of Taxes, Borrower shall furnish to Agent the original or a certified copy of a receipt evidencing payment thereof.

(b) Each Credit Party that is a signatory hereto shall jointly and severally indemnify and, within ten (10) days of demand therefor, pay Agent and each Lender for the full amount of Taxes (including any Taxes imposed by any jurisdiction on amounts payable under this Section 1.13) paid by Agent or such Lender, as appropriate, and any liability (including penalties, interest and expenses) arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally asserted.

(c) Each Lender organized under the laws of a jurisdiction outside the United States (a “ Foreign Lender ”) as to which payments to be made under this Agreement or under the Notes are exempt from United States withholding tax under an applicable statute or tax treaty shall provide to Borrower and Agent a properly completed and executed IRS Form W-8ECI or Form W-8BEN or other applicable form, certificate or document prescribed by the IRS or the United States certifying as to such Foreign Lender’s entitlement to such exemption (a “ Certificate of Exemption ”). Any foreign Person that seeks to become a Lender under this Agreement shall provide a Certificate of Exemption to Borrower and Agent prior to becoming a Lender hereunder. No foreign Person may become a Lender hereunder if such Person fails to deliver a Certificate of Exemption in advance of becoming a Lender.

 

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(d) To the extent that the payment of Agent’s or any Lender’s Taxes by Borrower hereunder gives rise from time to time to a Tax Benefit (as defined below) to such Agent or Lender in any jurisdiction other than the jurisdiction which imposed such Taxes, such Agent or Lender (as the case may be) shall pay to Borrower the amount of each such Tax Benefit so recognized or received by it. The amount of each Tax Benefit and, therefore, payment to Borrower will be determined from time to time by the relevant Agent or Lender in its sole good faith judgment, which determination shall be binding and conclusive on all parties hereto in the absence of manifest error. Each such payment will be due and payable by such Agent or Lender to Borrower within a reasonable time after the filing of the tax return in which such Tax Benefit is recognized or, in the case of any tax refund, after the tax refund is received; provided , however, if at any time thereafter such Agent or Lender is required to rescind such Tax Benefit or such Tax Benefit is otherwise disallowed or nullified, Borrower shall promptly, after notice thereof from such Agent or Lender, repay to such Agent or Lender the amount of such Tax Benefit previously paid to it which has been rescinded, disallowed or nullified. For purposes hereof, the term “ Tax Benefit ” shall mean the amount by which Agent’s or any Lender’s liability for any Taxes for the taxable period in question is reduced below what would have been payable had Borrower not been required to pay such Agent’s or Lender’s Taxes hereunder.

(e) Notwithstanding the foregoing, Borrower shall only be obligated to compensate Agent or such Lender for any amount under this Section 1.13 arising or occurring during in the case of each such request for compensation, (i) any time or period commencing not more than one hundred twenty days (120) days prior to the date on which Agent or such Lender submits such request and (ii) any other time or period during which, because of the unannounced retroactive application of such law, regulation, interpretation, request or directive, Agent or such Lender did not know that the resulting reduction in return might arise.

1.14 Capital Adequacy; Increased Costs; Illegality .

(a) If any Lender shall have determined that any law, treaty, governmental (or quasi-governmental) rule, regulation, guideline or order regarding capital adequacy, reserve requirements or similar requirements or compliance by any Lender with any request or directive regarding capital adequacy, reserve requirements or similar requirements (whether or not having the force of law), in each case, adopted after the Closing Date, from any central bank or other Governmental Authority increases or would have the effect of increasing the amount of capital, reserves or other funds required to be maintained by such Lender and thereby reducing the rate of return on such Lender’s capital as a consequence of its obligations hereunder by an amount determined in good faith by such Lender to be material, then Borrower shall from time to time upon demand by such Lender (with a copy of such demand to Agent) pay to Agent, for the account of such Lender, additional amounts sufficient to compensate such Lender for such reduction. A certificate as to the amount of that reduction and showing in reasonable detail the basis of the computation thereof submitted by such Lender to Borrower and to Agent shall, be presumptive evidence of the matters set forth therein. Notwithstanding the foregoing, Borrower shall only be obligated to compensate such Lender for any amount under this subsection arising or occurring during in the case of each such request for compensation, (i) any time or period

 

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commencing not more than ninety (90) days prior to the date on which such Lender submits such request and (ii) any other time or period during which, because of the unannounced retroactive application of such law, regulation, interpretation, request or directive, such Lender did not know that the resulting reduction in return might arise.

(b) If, due to either (i) the introduction of or any change in any law or regulation (or any change in the interpretation thereof) or (ii) the compliance with any guideline or request from any central bank or other Governmental Authority (whether or not having the force of law), in each case adopted after the Closing Date, there shall be any increase in the cost to any Lender of agreeing to make or making, funding or maintaining any Loan in an amount determined in good faith by such Lender to be material, then Borrower shall from time to time, upon demand by such Lender (with a copy of such demand to Agent), pay to Agent for the account of such Lender additional amounts sufficient to compensate such Lender for such increased cost. A certificate setting forth in reasonable detail the basis for the amount of such increased cost, submitted to Borrower and to Agent by such Lender, shall be presumptive evidence of the matters set forth therein. Each Lender agrees that, as promptly as practicable after it becomes aware of any circumstances referred to above which would result in any such increased cost, the affected Lender shall, to the extent not inconsistent with such Lender’s internal policies of general application, use reasonable commercial efforts to minimize costs and expenses incurred by it and payable to it by Borrower pursuant to this Section 1.14(b) . Notwithstanding the foregoing, Borrower shall only be obligated to compensate such Lender for any amount under this subsection arising or occurring during in the case of each such request for compensation, (i) any time or period commencing not more than ninety (90) days prior to the date on which such Lender submits such request and (ii) any other time or period during which, because of the unannounced retroactive application of such law, regulation, interpretation, request or directive, such Lender did not know that the resulting increase in cost might arise.

(c) Notwithstanding anything to the contrary contained herein, if the introduction of or any change in any law or regulation (or any change in the interpretation thereof) shall make it unlawful, or any central bank or other Governmental Authority shall assert that it is unlawful, for any Lender to agree to make or to make or to continue to fund or maintain any LIBOR Loan, then, unless that Lender is able to make or to continue to fund or to maintain such LIBOR Loan at another branch or office of that Lender without, in that Lender’s sole good faith judgment, adversely affecting it or its Loans or the income obtained therefrom, on notice thereof and demand therefor by such Lender to Borrower through Agent, (i) the obligation of such Lender to agree to make or to make or to continue to fund or maintain LIBOR Loans shall terminate and (ii) Borrower shall forthwith prepay in full all outstanding LIBOR Loans owing by Borrower to such Lender, together with interest accrued thereon, Vunless Borrower, within five (5) Business Days after the delivery of such notice and demand, converts all LIBOR Loans owing by Borrower to such Lender into Index Rate Loans.

(d) After receipt by Borrower of written notice and demand from any Lender (an “ Affected Lender ”) for payment of additional amounts or increased costs as provided in Section 1.13(a), 1.14(a) or 1.14(b) , Borrower may, at its option, notify Agent and such Affected Lender of its intention to replace the Affected Lender. So long as no Default or Event of Default has occurred and is continuing, Borrower may obtain, at Borrower’s expense, a replacement Lender (“ Replacement Lender ”) for the Affected Lender, which Replacement Lender must be

 

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approved by Agent (which approval shall not be unreasonably withheld or delayed if such Replacement Lender is a Qualified Assignee). If Borrower obtains a Replacement Lender, the Affected Lender, within ten (10) Business Days following notice, must sell and assign its Loans and Commitments to such Replacement Lender for an amount equal to the principal balance of all Loans held by the Affected Lender and all accrued interest and Fees with respect thereto through the date of such sale; provided , that Borrower shall have reimbursed such Affected Lender for the additional amounts or increased costs that it is entitled to receive under this Agreement through the date of such sale and assignment. Notwithstanding the foregoing, Borrower shall not have the right to obtain a Replacement Lender if the Affected Lender rescinds its demand for increased costs or additional amounts within five (5) days following its receipt of Borrower’s notice of intention to replace such Affected Lender. Furthermore, if Borrower gives a notice of intention to replace and does not so replace such Affected Lender, Borrower shall promptly pay all increased costs or additional amounts demanded by such Affected Lender pursuant to Section 1.13(a), 1.14(a) or 1.14(b) .

(e) For the avoidance of doubt, this Section 1.14 (other than subsection (d) above) shall not apply to Taxes, which shall be governed exclusively by Section 1.13 .

1.15 Single Loan . All of the Loans and all of the other Obligations arising under this Agreement and the other Loan Documents shall constitute one general obligation of the applicable Credit Parties secured, until the Termination Date, by all of the Collateral.

 

II.	CONDITIONS PRECEDENT

2.1 Conditions to the Initial Loans . No Lender shall be obligated hereunder to make any Loans or incur any Letter of Credit Obligations on the Closing Date, or to take, fulfill, or perform any other action hereunder, until the following conditions have been satisfied or provided for in a manner reasonably satisfactory to Agent, or waived in writing by Agent and Lenders:

(a) Credit Agreement; Loan Documents . This Agreement or counterparts hereof shall have been duly executed by, and delivered to, Borrower, each other Credit Party signatory hereto, Agent and Lenders; and Agent shall have received all of the documents, instruments, agreements and legal opinions listed in the Closing Checklist attached hereto as Annex D , each in form and substance reasonably satisfactory to Agent.

(b) Repayment of Prior Lender Obligations; Satisfaction of Outstanding L/Cs . All of the Prior Lender Obligations (other than certain letters of credit) will be repaid in full from the proceeds of the initial Loans and the Mezzanine Loan and all Liens upon any of the property of the Credit Parties in favor of the Prior Lenders or their agent shall be terminated and released immediately upon such payment.

(c) Approvals . Agent shall have received (i) satisfactory evidence that the Credit Parties have obtained all required consents and approvals of all Persons, including all requisite Governmental Authorities, to the execution, delivery and performance of this Agreement and the other Loan Documents and the consummation of the Related Transactions, including, but not limited to, those set forth in Disclosure Schedule (3.3)  or (ii) an officer’s certificate in form and substance reasonably satisfactory to Agent affirming that no such consents or approvals are required.

 

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(d) Minimum Consolidated EBITDA . The Consolidated EBITDA of Borrower for the twelve (12) consecutive Fiscal Months ended July 31, 2008 shall not be less than $40,500,000 (inclusive of pro forma adjustments of which not more than $10,500,000 shall relate to integration benefits).

(e) Total Leverage Ratio . As of the Closing Date, after giving effect to the Related Transactions, the Total Leverage Ratio of the Borrower and its Subsidiaries on a consolidated basis for the most recently ended Rolling Period shall be equal to or less than 5.06 to 1.00; provided , that Letters of Credit shall not be included for purposes of determining compliance with this Section 2.1(e) as of the Closing Date.

(f) Senior Leverage Ratio . As of the Closing Date, after giving effect to the Related Transactions, the Senior Leverage Ratio of the Borrower and its Subsidiaries on a consolidated basis for the most recently ended Rolling Period shall be equal to or less than 3.21 to 1.00.

(g) Payment of Fees . Borrower shall have paid the Fees required to be paid on the Closing Date in the respective amounts specified in Section 1.7 (including the Fees specified in the Arranger Fee Letter), and shall have reimbursed Agent, Arrangers and Collateral Agent for all reasonable, documented and out-of-pocket fees, costs and expenses of closing presented as of the Closing Date.

(h) Capital Structure; Other Indebtedness . The corporate structure of each Credit Party, all governing organizational documents of the Credit Parties, and the terms and conditions of all Indebtedness of each Credit Party, in each case after giving effect to the consummation of all Related Transactions on the Closing Date, shall be as set forth in the Merger Agreement and the other Related Transactions Documents approved by Agent.

(i) Consummation of Related Transactions . Agent shall have received fully executed copies of each of the Related Transactions Documents (other than the Loan Documents), each of which shall be in all material respects in form and substance previously approved by Agent and its counsel without waiver of any term or condition thereof that would be materially adverse to the Lenders without the consent of the Agent (such consent not to be unreasonably withheld, conditioned or delayed) and the Related Transactions shall have been consummated in material compliance with the terms of such Related Transactions Documents (other than the funding of the initial Loans on the Closing Date).

(j) Initial Equity Contribution . Agent shall have received evidence in form and substance satisfactory to Agent that the Initial Equity Contribution has been consummated.

(k) Mezzanine Loan Documents . The Mezzanine Loan Documents shall have been duly executed on terms and conditions consistent with the terms and conditions set forth in the Mezzanine Commitment Letter and otherwise reasonably satisfactory to Agent and Agent shall have received evidence reasonably satisfactory to it that (i) all conditions precedent to the making of the Mezzanine Loan have been fulfilled (other than the making of the initial Loans and the incurrence of the initial Letter of Credit Obligations hereunder) and (ii) Borrower has received gross proceeds of $75,000,000 from the Mezzanine Loan.

 

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(1) Borrowing Availability . Notwithstanding anything herein to the contrary, not more than $1,000,000 of Revolving Loans shall be advanced or incurred on the Closing Date (other than the incurrence of the initial Letter of Credit Obligations in an aggregate amount not to exceed $2,000,000).

2.2 Further Conditions . Except as otherwise expressly provided herein, no Lender shall be obligated to fund its share of any Loan or incur any Letter of Credit Obligation, if as of the date thereof:

(a) Any representation or warranty by any Credit Party contained herein or in any other Loan Document is untrue or incorrect in any material respect as of such date, except to the extent that such representation or warranty expressly relates to an earlier date and except for changes therein expressly permitted or expressly contemplated by this Agreement.

(b) Any Event of Default has occurred and is continuing or would result after giving effect to such Loan (or the incurrence of such Letter of Credit Obligation).

(c) After giving effect to such Loan (or the incurrence of such Letter of Credit Obligations), the outstanding principal amount of the Revolving Loan would exceed the Maximum Amount, less, without duplication, the then outstanding principal amount of the Swing Line Loan.

The request and acceptance by Borrower of the proceeds of any Revolving Credit Advance or Loan and the incurrence of any Letter of Credit Obligation shall be deemed to constitute, as of the date thereof, (i) a representation and warranty by Borrower that the conditions in this Section 2.2 have been satisfied and (ii) a reaffirmation of the granting and continuance of Collateral Agent’s Liens, for the benefit of itself and the other Lenders, pursuant to the Collateral Documents.

 

III.	REPRESENTATIONS AND WARRANTIES

To induce Lenders to make the Loans and to incur Letter of Credit Obligations, the Credit Parties executing this Agreement, jointly and severally, make the following representations and warranties to Agent, Collateral Agent and each Lender with respect to all Credit Parties, after giving effect to the Related Transactions, each and all of which shall survive the execution and delivery of this Agreement:

3.1 Corporate Existence; Compliance with Law . Each Credit Party (a) is a corporation, limited liability company, limited partnership or other legal entity duly organized and validly existing under the laws of its respective jurisdiction of incorporation or organization set forth as of the Closing Date in Disclosure Schedule (3.1) ; (b) (i) as to Borrower and each material Subsidiary of Borrower, is in good standing under the laws of its respective jurisdiction of incorporation or organization, and (ii) for each other Credit Party, is in good standing under the laws of its respective jurisdiction of incorporation or organization except where the failure to be in good standing could not reasonably be expected to have a Material Adverse Effect; (c) is

 

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duly qualified to conduct business and is in good standing in each other jurisdiction where its ownership or lease of property or the conduct of its business requires such qualification, except where the failure to be so qualified or in good standing would not result in a Material Adverse Effect; (d) has the requisite power and authority and the legal right to own, pledge, mortgage or otherwise encumber and operate its properties, to lease the property it operates under lease and to conduct its business as now, heretofore and proposed to be conducted; (e) subject to specific representations set forth in this Agreement regarding Environmental Laws, has all material licenses, permits, consents or approvals from or by, and has made all material filings with, and has given all material notices to, all Governmental Authorities having jurisdiction, to the extent required for such ownership, operation and conduct, except as could not reasonably be expected to have a Material Adverse Effect; (f) is in compliance with its charter and bylaws or partnership, operating agreement or other governing document, as applicable; and (g) subject to specific representations set forth in this Agreement regarding ERISA, Environmental Laws, tax and other laws, is in compliance with all applicable provisions of law, except where the failure to comply, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

3.2 Executive Offices, Collateral Locations, FEIN . As of the Closing Date, each Credit Party’s name as it appears in official filings in its state of incorporation or organization, the current location of each Credit Party’s chief executive office, principal place of business and all premises at which any Collateral is located are set forth in Schedule III to the Security Agreement executed by such Credit Party. During the five (5) years preceding the Closing Date, except as set forth on Schedule III to the Security Agreement executed by such Credit Party, no Credit Party has been known as or used any corporate, fictitious or trade name. In addition, Schedule III to the Security Agreement executed by each Credit Party lists the federal employer identification number and organizational number of such Credit Party.

3.3 Corporate Power, Authorization, Enforceable Obligations . The execution, delivery and performance by each Credit Party of the Loan Documents to which it is a party and the creation of all Liens provided for therein: (a) are within such Person’s corporate, company or partnership power; (b) have been duly authorized by all necessary or proper corporate, company, partnership, member or shareholder action on its part; (c) do not contravene any provision of such Person’s partnership agreement, operating agreement, charter or bylaws; (d) do not violate any material law or regulation, or any material order or decree of any court or Governmental Authority; (e) do not conflict with or result in a material breach or termination of, constitute a default under or accelerate or permit the acceleration of any performance required by, any material indenture, mortgage, deed of trust, lease, agreement or other instrument to which such Person is a party or by which such Person or any of its property is bound; (f) do not result in the creation or imposition of any Lien upon any of the property of such Person other than those in favor of Collateral Agent, for the benefit of itself and the other Lenders, pursuant to the Loan Documents and Permitted Liens; and (g) do not require the material consent or approval of any Governmental Authority or any other Person, except those referred to on Disclosure Schedule (3.3) , all of which will have been duly obtained, made or complied with prior to the Closing Date. Each of the Loan Documents shall be duly executed and delivered by each Credit Party that is a party thereto and each such Loan Document shall constitute a legal, valid and binding obligation of such Credit Party enforceable against it in accordance with its terms except as may be limited by bankruptcy, insolvency, reorganization, receivership moratorium or other laws affecting creditors’ rights generally and by general principles of equity (regardless of whether sought in equity or in law).

 

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3.4 Financial Statements . All Financial Statements that are referred to below in clause (a) have been prepared in accordance with GAAP consistently applied for any Person specified in clause (a) throughout the periods covered (except as disclosed therein and except, with respect to unaudited Financial Statements, for the absence of footnotes and year-end audit adjustments) and present fairly in all material respects the financial position of the Persons covered thereby as at the dates thereof and the results of their operations and cash flows for the periods then ended, as applicable.

(a) Financial Statements . The following Financial Statements attached to the Solvency Certificate have been delivered on or prior to the date hereof:

(i) The audited consolidated balance sheets and the related statements of income with the consolidated and the related statements of cash flows (A) for the Fiscal Year ended December 31, 2007 for each of Parent and ChartOne, (B) for the Fiscal Years ended December 31, 2005 and December 31, 2006 for each of Companion Technologies Corporation, and ChartOne and (C) for the Fiscal Years ended September 30, 2005 and September 30, 2006 for Smart Document Solutions LLC.

(ii) The available unaudited balance sheet(s) as of the Fiscal Month most recently ended prior to the Closing Date, and the related statement(s) of income of ChartOne and Borrower and cash flows of Borrower, and capital expenditures of ChartOne for the twelve (12) Fiscal Months then ended.

(b) Pro Forma . The Pro Forma delivered on or prior to the date hereof and attached to the Solvency Certificate was prepared by the Credit Parties giving pro forma effect to the Related Transactions, was based on the unaudited consolidated balance sheets of Holdings and its Subsidiaries dated July 31, 2008, was prepared in good faith and presents fairly in all material respects the pro forma financial position of the Credit Parties as of such date.

(c) Projections . The Projections delivered on or prior to the date hereof and attached to the Solvency Certificate have been prepared by the Credit Parties in light of the past operations of their Business, and reflect projections for the five (5) year period beginning on July 1, 2008 on a quarter-by-quarter basis for the first year and on a year-by-year basis thereafter.

3.5 Material Adverse Effect . Between December 31, 2007 and the Closing Date, no event, change, condition or development has occurred, that alone or together with other events, could reasonably be expected to (a) have a Closing Date Material Adverse Effect, (b) have a material adverse effect on Borrower’s ability to pay any of the Loans or any of the other Obligations in accordance with the terms of the Agreement or any Guarantor’s ability to honor any guaranty obligations related to its Guaranty, (c) have a material adverse effect on the Collateral Agent’s or Agent’s Liens on behalf of itself and other Lenders, on the Collateral or the priority of such Liens, or (d) have a material adverse effect on Agent’s, Collateral Agent’s or any Lender’s rights and remedies under the Agreement and the other Loan Documents. Other than as of the Closing Date, since the Closing Date, no events or circumstances having a Material Adverse Effect has occurred.

 

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3.6 Ownership of Property; Liens . As of the Closing Date, the real estate (“Real Estate”) listed in Disclosure Schedule (3.6)  constitutes all of the real property owned, leased or subleased by any Credit Party. Each Credit Party owns good and marketable fee simple title to all of its owned Real Estate and valid leasehold interests in all of its leased Real Estate. Disclosure Schedule (3.6)  further describes any Real Estate with respect to which any Credit Party is a lessor or sublessor as of the Closing Date. Each Credit Party also has good and marketable title to, or valid leasehold interests in, all of its material personal property and assets. As of the Closing Date, none of the properties and assets of any Credit Party are subject to any Liens other than Permitted Liens, and there are no facts, circumstances or conditions known to any Credit Party that may result in any Liens (including Liens arising under Environmental Laws) other than Permitted Liens. Disclosure Schedule (3.6)  also describes any purchase options, rights of first refusal or other similar contractual rights pertaining to any Real Estate as of the Closing Date.

3.7 Labor Matters . As of the Closing Date (a) no strikes or other material labor disputes against any Credit Party are pending or, to any Credit Party’s knowledge, threatened; (b) hours worked by and payment made to employees of each Credit Party comply in all material respects with the Fair Labor Standards Act and each other federal, state, local or foreign law applicable to such matters, except where failure to comply, in the aggregate, would not reasonably be expected to have a Material Adverse Effect; (c) except as set forth in Disclosure Schedule (3.7) , no Credit Party is a party to or bound by any collective bargaining agreement; (d) there is no organizing activity involving any Credit Party pending or, to any Credit Party’s knowledge, threatened by any labor union or group of employees; (e) there are no representation proceedings pending or, to any Credit Party’s knowledge, threatened with the National Labor Relations Board, and no labor organization or group of employees of any Credit Party has made a pending demand for recognition; and (f) except as set forth in Disclosure Schedule (3.7) , there are no material complaints or charges against any Credit Party pending or, to the knowledge of any Credit Party, threatened to be filed with any Governmental Authority or arbitrator based on, arising out of, in connection with, or otherwise relating to the employment or termination of employment by any Credit Party of any individual that would reasonably be expected, in the aggregate, to have a Material Adverse Effect.

3.8 Ventures; Outstanding Stock and Indebtedness . Except as set forth in Disclosure Schedule (3.8) , as of the Closing Date, no Credit Party has any Subsidiaries or is engaged in any joint venture or partnership with any other Person. As of the Closing Date, all of the issued and outstanding Stock of each Credit Party is owned by each of the Stockholders and in the amounts set forth in Disclosure Schedule (3.8) . Except as set forth in Disclosure Schedule (3.8) , as of the Closing Date, there are no outstanding rights to purchase, options, warrants or similar rights or agreements pursuant to which any Credit Party may be required to issue, sell, repurchase or redeem any of its Stock or other equity securities or any Stock or other equity securities of its Subsidiaries. All outstanding Indebtedness and Guaranty Indebtedness of each Credit Party as of the Closing Date (except for the Obligations and the Mezzanine Obligations) is described in Section 6.3 (including Disclosure Schedule (6.3)) . Neither the Borrower nor any Guarantor has any obligation to contribute additional capital or property in connection with its investment in Proacsys.

 

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3.9 Government Regulation . No Credit Party is registered or required to be registered as an “investment company” or a company “controlled” by an “investment company”, as such terms are defined in the Investment Company Act of 1940, as amended.

3.10 Margin Regulations . No Credit Party is engaged, nor will it engage, principally or as one of its important activities, in the business of extending credit for the purpose of “purchasing” or “carrying” any “margin stock” as such terms are defined in Regulation U of the Federal Reserve Board as now and from time to time hereafter in effect (such securities being referred to herein as “ Margin Stock ”). None of the proceeds of the Loans or other extensions of credit under this Agreement will be used, directly or indirectly, for the purpose of purchasing or carrying any Margin Stock, for the purpose of reducing or retiring any Indebtedness that was originally incurred to purchase or carry any Margin Stock or for any other purpose that might cause any of the Loans or other extensions of credit under this Agreement to be considered a “purpose credit” within the meaning of Regulations T, U or X of the Federal Reserve Board.

3.11 Taxes . All federal, state and other income tax returns and other material non-income tax returns, reports and statements, including information returns, required by any Governmental Authority to be filed by any Credit Party have been filed with the appropriate Governmental Authority and all Charges have been paid prior to the date on which any fine, penalty, interest or late charge may be added thereto for nonpayment thereof (or any such fine, penalty, interest, late charge or loss has been paid), excluding Charges or other amounts being contested in accordance with Section 5.2(b) and those Charges in an aggregate amount not to exceed $1,000,000). Disclosure Schedule (3.11)  sets forth as of the Closing Date those taxable years for which any Credit Party’s tax returns are currently being audited by the IRS or any other applicable Governmental Authority and any assessments or threatened assessments in connection with such audit, or otherwise currently outstanding.

3.12 ERISA .

(a) Disclosure Schedule (3.12)  lists all material Plans as of the Closing Date. Except with respect to Multiemployer Plans, each Qualified Plan has received a favorable determination or opinion letter from the IRS (or is within the applicable remedial amendment period) and, to the knowledge of any Credit Party, nothing has occurred that would cause the loss of such qualification. Except as would not reasonably be expected to result in a Material Adverse Effect: (i) each Plan is in compliance with the applicable provisions of ERISA and the IRC; (ii) neither any Credit Party nor any ERISA Affiliate has failed to make any contribution or pay any amount due as required by either Section 412 of the IRC or Section 302 of ERISA; (iii) neither any Credit Party nor any ERISA Affiliate has engaged in a “prohibited transaction,” as defined in Section 406 of ERISA and Section 4975 of the IRC, in connection with any Plan, that would be reasonably expected to subject any Credit Party to a material tax on prohibited transactions imposed by Section 502(i) of ERISA or Section 4975 of the IRC; and (iv) all payments due and payable from any Credit Party to a Plan have been paid or accrued as a liability on the books of such Credit Party.

 

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(b) No Credit Party or, except as would not reasonably be expected to result in a Material Adverse Effect, ERISA Affiliate, maintains or contributes to or, except as would not reasonably be expected to result in a Material Adverse Effect, has any liability or contingent liability with respect to any Title IV Plan or Multiemployer Plan. Except as would not reasonably be expected to result in a Material Adverse Effect, (i) no ERISA Event has occurred or is reasonably expected to occur and (ii) there are no pending, or to the knowledge of any Credit Party, threatened claims (other than claims for benefits in the normal course), sanctions, actions or lawsuits, asserted or instituted against any Plan or any Person as fiduciary or sponsor of any Plan.

3.13 No Litigation . Except as set forth on Disclosure Schedule (3.13) , no action, claim, lawsuit, investigation, order, injunction or proceeding is now pending or, to the knowledge of any Credit Party, threatened against any Credit Party, before any Governmental Authority or before any arbitrator or panel of arbitrators (collectively, “ Litigation ”), (a) that challenges any Credit Party’s right or power to enter into or perform any of its obligations under the Loan Documents to which it is a party, or the validity or enforceability of any Loan Document or any action taken thereunder, or (b) that has a reasonable risk of being determined adversely to any Credit Party and that, if so determined, could reasonably be expected to have a Material Adverse Effect.

3.14 Brokers . Except as set forth in Disclosure Schedule (3.14) , no broker or finder acting on behalf of any Credit Party or Affiliate thereof brought about the obtaining, making or closing of the Loans or the Related Transactions, and no Credit Party or Affiliate thereof has any obligation to any Person in respect of any finder’s or brokerage fees in connection therewith.

3.15 Intellectual Property . Each Credit Party owns or has rights to use all Intellectual Property necessary to continue to conduct its Business as now or heretofore conducted by it. As of the Closing Date, each Patent, Patent application, registered Trademark, Trademark application, registered Copyright and material License is listed, together with application or registration numbers, as applicable, in Disclosure Schedule (3.15) . Each Credit Party conducts its Business and affairs without infringement of any Intellectual Property of any other Person in any material respect. Except as set forth in Disclosure Schedule (3.15) , as of the Closing Date, no Credit Party is aware of any infringement claim by any other Person with respect to any Intellectual Property.

3.16 Full Disclosure . No information contained in this Agreement concerning any Credit Party, any of the other Loan Documents, the Financial Statements, Notices of Revolving Credit Advance, Notices of Incremental Facility Commitment or other written reports from time to time delivered hereunder or any written statement furnished by or on behalf of any Credit Party to Agent or any Lender pursuant to the terms of this Agreement (excluding any Projections and Pro Forma information), contained or contains, at the time furnished, any untrue statement of a material fact or omitted or omits to state a material fact necessary to make the statements contained herein or therein not misleading in any material way in light of the circumstances under which they were made. The Projections, the Pro Forma and all other pro forma financial information provided by the Credit Parties are based on good faith estimates and assumptions believed by such Persons to be reasonable and fair in light of current conditions and

 

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current facts known to such Persons as of the date provided. The Agent and the Lenders recognize that projections as to future events are not to be viewed as facts or factual information and that actual results during the period or periods covered thereby may differ materially from projected results. Upon the filing of financing statements and other filings specified in Disclosure Schedule (3.16)  in appropriate form in the offices specified on Disclosure Schedule (3.16) , the Liens granted to Collateral Agent, on behalf of itself and the other Lenders, pursuant to the Collateral Documents shall constitute fully perfected first priority Liens in and to the Collateral described therein (to the extent perfection may be accomplished under Article 9 of the UCC by the filing of such financing statements and other filings), subject to the terms of the Collateral Documents and subject to Permitted Liens.

3.17 Environmental Matters . (a) Except as set forth in Disclosure Schedule (3.17) , as of the Closing Date and (b) in the case of any other matters described in clauses (i) through (vii) below that could not reasonably be expected to give rise to a Material Adverse Effect: (i) the Real Estate is free of contamination from any Hazardous Material except for such contamination that would not adversely impact the value or marketability of such Real Estate; (ii) no Credit Party has caused or suffered to occur any Release of Hazardous Materials on, at, in, under, above, to, from or about any of its Real Estate; (iii) the Credit Parties are and have been in compliance with all Environmental Laws; (iv) the Credit Parties have obtained, and are in compliance with, all Environmental Permits required by Environmental Laws for the operations of their Business as presently conducted or as proposed to be conducted, and all such Environmental Permits are valid, uncontested and in good standing; (v) no Credit Party is involved in operations or knows of any facts, circumstances or conditions, including any Releases of Hazardous Materials, and no Credit Party has permitted any current or former tenant or occupant of the Real Estate to engage in any such operations; (vi) there is no Litigation arising under or related to any Environmental Laws, Environmental Permits or Hazardous Material, or injunctive relief against, or that alleges criminal misconduct by, any Credit Party; (vii) no written notice has been received by any Credit Party identifying it as a “potentially responsible party” or requesting information under CERCLA or analogous state statutes, and to the knowledge of the Credit Parties, there are no facts, circumstances or conditions that may result in any Credit Party being identified as a “potentially responsible party” under CERCLA or analogous state statutes; and (viii) the Credit Parties have provided to Agent copies of all reports, including any existing Phase 1 or Phase 2 reports, records and correspondence with respect to environmental permits, conditions, claims, hazards or compliance by any of the Credit Parties.

3.18 Insurance . Disclosure Schedule (3.18)  lists all insurance policies of any nature maintained, as of the Closing Date, for current occurrences by each Credit Party, as well as a description of such policy setting forth the name of the insurer, the amount of coverage, the type of insurance and its renewal or expiration date.

3.19 Deposit and Disbursement Accounts . Disclosure Schedule (3.19)  lists all banks and other financial institutions at which any Credit Party maintains deposit or other accounts as of the Closing Date, including any Disbursement Accounts, and such Disclosure Schedule correctly identifies the name, address and telephone number of each depository, the name in which the account is held, a description of the purpose of the account, and the complete account number therefor.

 

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3.20 Solvency . After giving effect to (a) the Loans, the Letter of Credit Obligations and the Mezzanine Loan to be made or incurred on the Closing Date or such other date as any other Loans or Letter of Credit Obligations requested hereunder are made or incurred, (b) the disbursement of the proceeds of such Loans and the Mezzanine Loan pursuant to the instructions of Borrower, (c) the Acquisition and the consummation of the other Related Transactions and (d) the payment and accrual of all transaction costs in connection with the foregoing, the Credit Parties, taken as a whole, are and will be Solvent.

3.21 Status of Holdings and Parent . Prior to the Closing Date, Holdings and Parent have not engaged in any business or incurred any Indebtedness or any other liabilities (except in connection with its corporate formation, the holding of the Stock of its Subsidiaries, the Related Transactions, the Mezzanine Obligations and Guaranteed Indebtedness incurred for the benefit of any other Credit Party if the primary obligation is expressly permitted by this Agreement).

3.22 Mezzanine Loan Documents . As of the Closing Date, Borrower has delivered to Agent a duly executed, complete and correct copy of each of the Mezzanine Loan Documents (including all schedules, exhibits, amendments, supplements, modifications, assignments and all other documents delivered pursuant thereto or in connection therewith). No Credit Party is in default in the performance or compliance with any material provisions thereof that constitute an “event of default” thereunder. The Mezzanine Loan complies with all applicable laws. All requisite approvals by Governmental Authorities having jurisdiction over any Credit Party required for the execution, delivery and performance by such Credit Party of any of the Mezzanine Loan Documents have been obtained. Each of the representations and warranties given by each applicable Credit Party in any Mezzanine Loan Document is true and correct in all material respects as of the date made or deemed made thereunder.

3.23 Patriot Act . Each Credit Party is in compliance with the (a) the Trading with the Enemy Act, as amended, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling legislation or executive order relating thereto, and (b) the Uniting And Strengthening America By Providing Appropriate Tools Required To Intercept And Obstruct Terrorism (USA Patriot Act of 2001). No part of the proceeds of the Loans will be used, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.

3.24 Bonding; Licenses . Except as set forth on Disclosure Schedule (3.24) , as of the Closing Date, no Credit Party is a party to or bound by any surety bond agreement or bonding requirement with respect to products or services sold by it or any trademark or patent license agreement with respect to products sold by it.

 

IV.	FINANCIAL STATEMENTS AND INFORMATION

4.1 Reports and Notices . Borrower hereby agrees that from and after the Closing Date and until the Termination Date, it shall deliver to Agent, for delivery to each Lender, the Financial Statements, notices, Projections and other information at the times, in the manner set forth in Annex E .

 

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4.2 Communication with Accountants . Each Credit Party executing this Agreement authorizes Agent to communicate directly with its independent certified public accountants and authorizes and, at Agent’s reasonable request, shall instruct those accountants and advisors to disclose and make available to Agent, and Agent will make same available to Lenders, any and all Financial Statements and other supporting financial documents, schedules and information relating to any Credit Party (including copies of any issued management letters) with respect to the Business, financial condition and other affairs of any Credit Party.

 

V.	AFFIRMATIVE COVENANTS

Each Credit Party executing this Agreement jointly and severally agrees as to all Credit Parties that from and after the date hereof and until the Termination Date:

5.1 Maintenance of Existence and Conduct of Business . Except as permitted under Section 6.1 hereof, each Credit Party shall: (i) do or cause to be done all things necessary to preserve and keep in full force and effect its legal existence as an entity and its rights and franchises, except for rights and franchises the failure of which to preserve would not reasonably be expected to have a Material Adverse Effect; (ii) continue to conduct its Business substantially as now conducted or as otherwise permitted hereunder; and (iii) at all times maintain, preserve and protect all of its tangible assets and properties used or useful in the conduct of its Business and keep the same in good repair, working order and condition in all material respects (taking into consideration ordinary wear and tear) and from time to time make, or cause to be made, all reasonably necessary repairs, replacements and improvements thereto consistent with industry practices.

5.2 Payment of Obligations . Each Credit Party shall pay or discharge before they become delinquent (a) all Charges payable by it, including Charges imposed upon it, its income and profits, or any of its property (real, personal or mixed) and all Charges with respect to tax, social security and unemployment withholding with respect to its employee and (b) all other lawful claims that if unpaid would, by the operation of applicable requirements of law, become a Lien upon any property of any Credit Party (other than Permitted Liens), except, in each case, for those whose amount or validity is being contested in good faith by proper proceedings diligently conducted and for which adequate reserves are maintained on the books of the appropriate Credit Party in accordance with GAAP or those in aggregate amount of less than $1,000,000.

5.3 Books and Records . Each Credit Party shall keep adequate books and records with respect to its business activities in which entries, reflecting all financial transactions, are made that would enable its Financial Statements to be prepared in accordance with GAAP.

 

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5.4 Insurance; Damage to or Destruction of Collateral .

(a) The Credit Parties shall, at their sole cost and expense, keep their insurable property adequately insured at all times by reputable insurers (giving effect to self insurance), to such extent and against such risks as is customary with companies in the same or similar businesses with similar risk factors against such casualties and contingencies and of such types and in such amounts with such deductibles as is customary in the case of similar businesses with similar risk factors. The Credit Parties shall use commercially reasonable efforts to ensure that such policies of insurance (or the loss payable and additional insured endorsements delivered to Collateral Agent) shall contain provisions pursuant to which the insurer agrees to provide thirty (30) days’ prior written notice to Collateral Agent in the event of any non-renewal, cancellation or amendment of any such insurance policy. If any Credit Party at any time or times hereafter shall fail to obtain or maintain any of the policies of insurance required above or to pay all premiums relating thereto, Agent or Collateral Agent may at any time or times thereafter obtain and maintain such policies of insurance and pay such premiums and take any other action with respect thereto that Agent deems advisable. Neither Agent nor Collateral Agent shall have any obligation to obtain insurance for any Credit Party or pay any premiums therefor. By doing so, neither Agent nor Collateral Agent shall be deemed to have waived any Default or Event of Default arising from any Credit Party’s failure to maintain such insurance or pay any premiums therefor. All sums so disbursed, including reasonable attorneys’ fees, court costs and other charges related thereto, shall be payable on demand by Borrower to Agent or Collateral Agent (as the case may be) and shall be additional Obligations hereunder secured by the Collateral.

(b) If reasonably requested by Agent, each Credit Party shall deliver to Agent from time to time a report of a reputable insurance broker, in form reasonably satisfactory to Agent, with respect to its insurance policies.

(c) Each Credit Party executing this Agreement shall deliver to Agent, in form and substance reasonably satisfactory to Agent, endorsements to (i) all “All Risk” insurance and business interruption insurance naming Collateral Agent, on behalf of itself and the other Lenders, as loss payee (provided that the Collateral Agent shall not have the right to receive business interruption Net Cash Proceeds of $12,500,000 or less), and (ii) all general liability and other liability policies naming Collateral Agent, on behalf of itself and the other Lenders, as additional insured. Each such Credit Party irrevocably makes, constitutes and appoints Agent (and all officers, employees or agents designated by Agent), so long as any Event of Default has occurred and is continuing, as such Credit Party’s true and lawful agent and attorney-in-fact for the purpose of making, settling and adjusting claims under such “All Risk” policies of insurance, endorsing the name of such Credit Party on any check or other item of payment for the proceeds of such “All Risk” policies of insurance and for making all determinations and decisions with respect to such “All Risk” policies of insurance, in each case excluding business interruption proceeds of $12,500,000 or less. Neither Collateral Agent nor Agent shall have any duty to exercise any rights or powers granted to it pursuant to the foregoing power-of-attorney. Borrower shall promptly notify Agent and Collateral Agent, and Agent shall notify Lenders, of any loss, damage, or destruction to the Collateral in the amount of $1,000,000 or more, whether or not covered by insurance. The Credit Parties shall be entitled to apply the proceeds of any “All Risk” insurance (excluding business interruption) to replace, restore, repair or rebuild the property or, if no Event of Default has occurred and is continuing, to invest in Similar Assets; provided that, with respect to the Net Cash Proceeds of such insurance exceeding $1,000,000 during any twelve month period commencing after the Closing Date, if such Credit Party has not completed or entered into binding agreements to complete such replacement, restoration, repair, rebuilding or investment or used same to consummate a Permitted Acquisition within two hundred ten (210) days of receipt of such proceeds, such proceeds shall be applied to the Obligations in accordance with Section 1.3(d) .

 

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5.5 Compliance with Laws . Each Credit Party shall comply with all federal, state, local and foreign laws and regulations applicable to it, including those relating to HIPAA, ERISA and labor matters and Environmental Laws and Environmental Permits, except to the extent that the failure to comply, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

5.6 Supplemental Disclosure . From time to time as may be reasonably requested by Agent (which request will not be made more frequently than once each year absent the occurrence and continuance of a Default or an Event of Default), the Credit Parties shall supplement each Disclosure Schedule hereto, with respect to any matter hereafter arising that, if existing or occurring at the date of this Agreement, would have been required to be set forth or described in such Disclosure Schedule or that is necessary to correct any information in such Disclosure Schedule which has been rendered inaccurate thereby (and, in the case of any supplements to any Disclosure Schedule, such Disclosure Schedule shall be appropriately marked to show the changes made therein); provided that (a) no such supplement to any such Disclosure Schedule shall amend, supplement or otherwise modify any Disclosure Schedule, or be or be deemed a waiver of any Default or Event of Default resulting from the matters disclosed therein, except as consented to by Requisite Lenders in writing, and (b) no supplement shall be required or permitted as to representations and warranties that relate solely to the Closing Date.

5.7 Environmental Matters . Each Credit Party shall and shall cause each Person within its control to in the case of any matter described in clauses (a) through (d) below that could reasonably be expected, to give rise to a Material Adverse Effect: (a) conduct its operations and keep and maintain its Real Estate in compliance with all Environmental Laws and Environmental Permits; (b) implement any and all investigation, remediation, removal and response actions that are appropriate or necessary to maintain the value and marketability of the Real Estate or to otherwise comply in all material respects with Environmental Laws and Environmental Permits pertaining to the presence, generation, treatment, storage, use, disposal, transportation or Release of any Hazardous Material on, at, in, under, above, to, from or about any of its Real Estate; (c) notify Agent promptly after such Credit Party becomes aware of any violation of Environmental Laws or Environmental Permits or any Release on, at, in, under, above, to, from or about any Real Estate that is reasonably likely to result in material Environmental Liabilities, and after being so notified, Agent shall notify Lenders of same; and (d) promptly forward to Agent a copy of any material order, notice, request for information or any material communication or report received by such Credit Party in connection with any such material violation or Release or any other matter relating to any Environmental Laws or Environmental Permits that could reasonably be expected to result in material Environmental Liabilities, in each case whether or not the Environmental Protection Agency or any Governmental Authority has taken or threatened any action in connection with any such violation, Release or other matter. If Agent or Collateral Agent at any time has a reasonable basis to believe that there may be a violation of any Environmental Laws or Environmental Permits by any Credit Party or any Environmental Liability arising thereunder, or a Release of Hazardous Materials on, at, in, under, above, to, from or about any of its Real Estate, that, in each case, could reasonably be expected to have a Material Adverse Effect, then each Credit

 

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Party shall, upon Agent’s or Collateral Agent’s written request (i) cause the performance of such environmental audits including subsurface sampling of soil and groundwater, and preparation of such environmental reports, at Borrower’s expense, as Agent or Collateral Agent (as the case may be) may from time to time reasonably request, which shall be conducted by reputable environmental consulting firms reasonably acceptable to Agent or Collateral Agent (as the case may be) and shall be in form and substance reasonably acceptable to Agent, and (ii) permit Agent or Collateral Agent or its representatives to have access to all Real Estate for the purpose of conducting such environmental audits and testing as Agent or Collateral Agent (as the case may be) deems appropriate, including subsurface sampling of soil and groundwater. Borrower shall reimburse Agent or Collateral Agent (as the case may be) for the reasonable costs of such audits and tests and the same will constitute a part of the Obligations secured hereunder.

5.8 Landlords’ Agreements, Mortgagee Agreements, Bailee Letters and Real Estate Purchases . Subject to such exceptions as may be acceptable to Agent, the Credit Parties shall use commercially reasonable efforts to obtain a landlord’s agreement, or bailee letter, as applicable, from the lessor of each material leased property listed on Disclosure Schedule (5.8)  and for all material leased property acquired after the Closing Date, as determined by Agent in its reasonable discretion, which agreement or letter (i) shall contain a waiver or subordination of all Liens or claims that the landlord or bailee may assert against the Collateral at that location, (ii) shall provide that Collateral Agent shall, so long as an Event of Default shall have occurred and be continuing, have reasonable access to the affected premises for a specified period of time in order to inspect, maintain and dispose of any Collateral located there, and (iii) shall otherwise be reasonably satisfactory in form and substance to Agent. In the event that a Credit Party conveys any of its assets to another Credit Party, whether in a sale, merger, consolidation, combination or other transaction, the recipient Credit Party shall be required to be in compliance with the terms of this Section 5.8 after giving effect to such conveyance. If any Credit Party acquires a fee ownership interest in any material Real Estate (which shall not include Real Estate acquired for less than $1,000,000), it shall provide Agent with written notice of such acquisition in accordance with Section 6.1 if acquired in connection with a Permitted Acquisition and otherwise, in the next Compliance Certificate required to be delivered pursuant to Annex E , and if requested in writing by Agent, such Credit Party shall provide Collateral Agent with a Mortgage granting Collateral Agent a first priority (subject to Permitted Liens) Lien on such Real Estate on behalf of itself and the other Lenders, together with environmental audits, as reasonably requested by Agent or to the extent otherwise available, mortgage title insurance commitment, real property survey, local counsel opinion(s), and, if reasonably required by Agent, supplemental casualty insurance and flood insurance, and such other customary related documents, instruments or agreements reasonably requested by Agent, in each case in form and substance reasonably satisfactory to Agent; provided that the requirements of this sentence shall not apply if a Credit Party’s acquisition of such Real Estate is substantially financed by its incurring of Indebtedness permitted under Section 6.3(i) or 6.3(xvi) .

5.9 Additional Subsidiary Guarantors .

(a) Promptly (and in any event within fifteen (15) days) after the formation or acquisition of any Domestic Subsidiary of either (A) Borrower or (B) any Domestic Subsidiary of Borrower, Borrower or such Domestic Subsidiary shall cause to be executed and delivered, (i) by such new Domestic Subsidiary, a guaranty in a form substantially similar to the Subsidiary

 

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Guaranty pursuant to which such Domestic Subsidiary shall guarantee the payment and performance of all of the Obligations, (ii) by such new Domestic Subsidiary, an Acknowledgement to the Security Agreement in the form of Exhibit B to the Security Agreement and pursuant to which Collateral Agent, for the benefit of itself and the other Lenders, shall be granted a first priority (subject to Permitted Liens) and perfected security interest in all Collateral (as defined in the Security Agreement) of such Domestic Subsidiary that is either (x) property in which a security interest can be granted and perfected under the Code or (y) Intellectual Property registered with the United States Patent and Trademark Office or the United States Copyright Office which security interest shall secure the Obligations, (iii) by such new Domestic Subsidiary if it owns any Intellectual Property that is registered with the United States Patent and Trademark Office or the United States Copyright Office, an Intellectual Property Security Agreement in substantially the form of the Intellectual Property Security Agreement delivered by the other Credit Parties on the Closing Date (or otherwise in form and substance reasonably satisfactory to Agent) and pursuant to which Collateral Agent, for the benefit of itself and the other Lenders, shall be granted a first priority (subject to Permitted Liens) and perfected security in all of such Intellectual Property to secure the Obligations, (iv) by the Credit Party that is such Domestic Subsidiary’s direct parent company, a Credit Party Pledge Agreement substantially in the form of the Credit Party Pledge Agreement delivered by the other Domestic Subsidiaries on the Closing Date (or otherwise in form and substance reasonably satisfactory to Agent) and pursuant to which all of the Stock of such new Domestic Subsidiary owned by each such parent company shall be pledged to Collateral Agent for the benefit of itself and the other Lenders on a first priority and perfected basis to secure the Obligations, and (v) by Borrower or the applicable Subsidiary, such other related documents (including closing certificates, legal opinions and other similar documents) as Collateral Agent may reasonably request, all in form and substance reasonably satisfactory to Agent.

(b) Promptly (and in any event within thirty (30) days, subject to extension in Agent’s reasonable discretion) after the creation or acquisition of any material (as determined by Agent in its reasonable discretion) first tier Foreign Subsidiary by any Credit Party, Borrower shall cause to be executed and delivered by such Credit Party that is such Foreign Subsidiary’s direct parent company, a Credit Party Pledge Agreement substantially in the form of the Holdings Pledge Agreement delivered by Borrower or the other Subsidiaries on the Closing Date (or otherwise in form and substance reasonably satisfactory to Agent) and pursuant to which sixty-five percent (65%) of the voting Stock and one hundred percent (100%) of the non-voting Stock of such new Foreign Subsidiary shall be pledged to Collateral Agent for the benefit of itself and the other Lenders on a first priority and perfected basis to secure the Obligations.

5.10 Interest Rate/Currency Fluctuations Protection . Within ninety (90) days after the Closing Date, Borrower shall enter into and maintain interest rate cap, swap or collar agreements, or other agreements or arrangements designed to provide protection against fluctuations in interest rates, which shall be effective for a period of not less than two (2) years and on terms and with counterparties reasonably acceptable to Agent, and pursuant to which Borrower is protected against increases in interest rates from and after the date of such contracts as to a notional amount of not less than fifty percent (50%) of the aggregate outstanding principal balance at such time of the Term Loan.

 

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5.11 Cash Management Systems . Within ninety (90) days after the Closing Date (as such date may be extended by the Agent), each Credit Party shall, and shall cause each Subsidiary (other than a Foreign Subsidiary) of each Credit Party to, enter into, and cause each depository, securities intermediary or commodities intermediary to enter into, control agreements reasonably satisfactory to Agent with respect to each deposit account and securities, commodity or similar account maintained by such Person, other than any payroll, fiduciary, trust, tax, escrow, benefit or zero balance account; provided , that control agreements shall not be required to be delivered for any such accounts of ChartOne for a period of one hundred twenty (120) days (as such date may be extended by the Agent) after the Closing Date.

5.12 Further Assurances . Each Credit Party executing this Agreement agrees that it shall and shall cause each other Credit Party to, at such Credit Party’s expense and upon request of Agent, duly execute and deliver, or cause to be duly executed and delivered, to Agent such further instruments and do and cause to be done such further acts as may be necessary or proper in the reasonable opinion of Agent to carry out more effectively the provisions and purposes of this Agreement or any other Loan Document.

 

VI.	NEGATIVE COVENANTS

Each Credit Party executing this Agreement jointly and severally agrees as to all Credit Parties that from and after the date hereof until the Termination Date:

6.1 Mergers, Subsidiaries, Etc. No Credit Party shall directly or indirectly, by operation of law or otherwise, merge with, consolidate with, acquire all or substantially all of the assets or Stock of, or otherwise combine with or acquire, any Person; provided , that (i) any Subsidiary of Borrower may be merged into Borrower so long as Borrower is the survivor of such merger, (ii) any Foreign Subsidiary of Borrower may be merged with and into or liquidated or dissolved into another Foreign Subsidiary of Borrower, provided , further that with respect to the merger of any Foreign Subsidiary with a first tier Foreign Subsidiary, a first tier Foreign Subsidiary shall be the surviving entity, (iii) any Domestic Subsidiary of Borrower may be merged with and into another Domestic Subsidiary of Borrower and (iv) any Subsidiary of Borrower may be liquidated or dissolved into Borrower or a Domestic Subsidiary of Borrower. Notwithstanding the foregoing, each of the following shall be permitted: (A) Capital Expenditures by Borrower and the Subsidiaries to the extent permitted by Section 6.10 , (B) purchases, licenses and other acquisitions of inventory, materials and equipment in the ordinary course of business, (C) investments in compliance with Section 6.2 , (D) leases of real or personal property in the ordinary course of business and in accordance with the applicable Collateral Documents, (E) the Related Transactions as contemplated by the Related Transaction Documents, and (F) Borrower or any Domestic Subsidiary of Borrower that is a Guarantor (or for asset acquisitions, Holdings, so long as contemporaneously therewith, all assets so acquired are transferred to Borrower or a Domestic Subsidiary of Borrower that is a Guarantor), may merge with (provided, in the case of Borrower that it is the surviving corporation in such merger), or acquire all or substantially all of the assets or stock of any Person or business (the “ Target ”) (in each case, a “ Permitted Acquisition ”) subject to the satisfaction of each of the following conditions:

(a) Agent shall receive at least ten (10) Business Days’ prior written notice of such proposed Permitted Acquisition, which notice shall include a reasonably detailed description of such proposed Permitted Acquisition;

 

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(b) such Permitted Acquisition shall only involve assets more than 50% of which is located in the United States and comprising a business, or those assets of a business, that is within the scope of the Business, provided that Permitted Acquisitions of assets more than 50% of which are located in jurisdictions other than the United States are permitted to the extent the aggregate consideration paid in connection with all such acquisitions does not exceed $25,000,000;

(c) such Permitted Acquisition shall be consensual and shall have been approved by the Target’s board of directors or the equivalent thereof;

(d) no additional Indebtedness, Guaranteed Indebtedness, contingent obligations or other liabilities shall be incurred, assumed or otherwise be reflected on a consolidated balance sheet of Borrower and Target after giving effect to such Permitted Acquisition, except (x) Loans made hereunder and (y) ordinary course trade payables, accrued expenses and Indebtedness permitted under Section 6.3 and any contingent obligations or other liabilities permitted or not prohibited under this Agreement to the extent no Default or Event of Default has occurred and is continuing or would result after giving effect to such Permitted Acquisition;

(e) the sum of all consideration paid in connection with all Permitted Acquisitions (including consideration in the form of Indebtedness but excluding acquired cash and cash equivalents) shall not exceed an aggregate amount equal to the sum of (i) $100,000,000 plus (ii) any proceeds reinvested to pay the purchase price of Permitted Acquisitions pursuant to Section 1.3(b)(iii) during the term hereof and any Stock of Parent issued as consideration; provided , however , that the sum of all consideration paid in connection with any one Permitted Acquisition transaction (other than the acquisition of the stock or assets of Iod Incorporated) shall not exceed $20,000,000, except to the extent expressly consented to by the Requisite Lenders in writing; provided further that , notwithstanding the foregoing, except as expressly consented to by the Requisite Lenders in writing, in the event that the stock or assets of Iod Incorporated are acquired prior to September 30, 2009, the consideration paid in connection with the acquisition of the stock or assets of Iod Incorporated shall not exceed $75,000,000 and the sum of consideration paid in connection with all Permitted Acquisitions from and after the Closing Date until September 30, 2009 shall not exceed $5,000,000 plus the consideration paid in connection with the acquisition of the stock or assets of Iod Incorporated;

(f) the Target shall have had positive Consolidated EBITDA for the trailing twelve month period preceding the date of the Permitted Acquisition, as determined based upon the Target’s financial statements for its most recently completed fiscal year and its most recent interim financial period completed within sixty (60) days prior to the date of consummation of such Permitted Acquisition which may reflect certain pro forma adjustments reasonably acceptable to Agent;

 

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(g) the Total Leverage Ratio of Holdings and its Subsidiaries both before and after giving effect to such Permitted Acquisition (including any Indebtedness described in Section 6.1(d)) shall be no higher than the lesser of (i) 5.06 to 1.00 and (ii) 0.25 to 1.00 less than the maximum Total Leverage Ratio Financial Covenant in effect for the most recently ended Rolling Period for which a Compliance Certificate has been delivered pursuant to Annex E ;

(h) the business and assets acquired in such Permitted Acquisition shall be free and clear of all Liens (other than Permitted Liens);

(i) to the extent required by the Collateral Documents or Section 5.9 , Collateral Agent will be granted a first priority perfected Lien (subject to Permitted Liens) in all assets acquired pursuant thereto, and the Credit Parties (and the Target in the case of an acquisition of Stock) shall have executed such documents and taken such actions as may be reasonably required by Agent in connection therewith;

(j) at or prior to the closing of any Permitted Acquisition, Borrower shall have delivered to Agent, in form reasonably satisfactory to Agent:

(i) a Compliance Certificate evidencing that, on a pro forma basis, no Event of Default has occurred and is continuing or would result after giving effect to such Permitted Acquisition and Borrower would have been in compliance with the financial covenants (as calculated after giving effect to the incremental Adjusted Consolidated EBITDA of Holdings and its Subsidiaries resulting from such Permitted Acquisition) set forth in Annex F for the four quarter period reflected in the Compliance Certificate most recently delivered to Agent pursuant to Annex E prior to the consummation of such Permitted Acquisition (after giving effect to such Permitted Acquisition and all Loans funded in connection therewith as if made on the first day of such period); and

(ii) a Certificate of Borrower to the effect that as of the date of such Permitted Acquisition: (w) the Credit Parties, taken as a whole, will be Solvent upon the consummation of the Permitted Acquisition; (x) the Acquisition Pro Forma fairly presents in all material respects the pro forma financial condition of Holdings and its Subsidiaries (on a consolidated basis) as of the date thereof after giving effect to the Permitted Acquisition; and (y) Borrower has completed its due diligence investigation with respect to the Target and such Permitted Acquisition, which Borrower believes in good faith to be prudent in light of the size and nature of the Target and such Permitted Acquisition;

(k) for any Permitted Acquisition with respect to which the total consideration paid is equal to or greater than $10,000,000, (i) the Borrowing Availability after giving effect to such Permitted Acquisition and the funding of all Loans in connection therewith, shall not be less than $4,000,000 and (ii) Borrower shall have delivered to Agent, in form reasonably satisfactory to Agent, a pro forma consolidated balance sheet and income statement of Holdings and its Subsidiaries (the “ Acquisition Pro Forma ”), based on recent financial statements for its most recent interim financial period for which statements were delivered or are required to have been delivered pursuant to Annex E , which shall be complete and shall fairly present in all material

 

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respects the assets, liabilities, financial condition and results of operations of Holdings and its Subsidiaries in accordance with GAAP consistently applied, subject to the absence of footnotes and audit and purchase accounting adjustments, but taking into account such Permitted Acquisition and the funding of all Loans in connection therewith;

(l) for any Permitted Acquisition with respect to which the total consideration paid is less than $10,000,000, the Borrowing Availability after giving effect to such Permitted Acquisition and the funding of all Loans in connection therewith, shall not be less than $3,000,000

(m) on or prior to the date of such Permitted Acquisition, Agent shall have received copies of the acquisition agreement and related material agreements and instruments, and, within forty-five (45) days of the date of such Permitted Acquisition (as such date may be extended by the Agent), each of those requested documents and deliverables as specified in the last sentence of Section 5.8 ;

(n) at the time of such Permitted Acquisition and after giving effect thereto, no Default or Event of Default has occurred and is continuing; and

(o) the terms of the acquisition of the stock or assets of Iod Incorporated shall be reasonably acceptable to Agent and Syndication Agent.

6.2 Investments; Loans and Advances . Except as otherwise expressly permitted by this Section 6 (including, without limitation, Section 6.1 and Section 6.4 ), no Credit Party shall make or permit to exist any investment in (other than Permitted Acquisitions), or make, accrue or permit to exist loans or advances of money to, any Person, through the direct or indirect lending of money, holding of securities or otherwise, except that: (a) Borrower and any Subsidiary may make investments, subject to Control Letters (for securities, commodities and other investment accounts, to the extent required by Section 5.11 ) in favor of Collateral Agent for the benefit of itself and the other Lenders or otherwise subject to a perfected security interest in favor of Collateral Agent for the benefit of itself and the other Lenders, to the extent required by the Loan Documents, in (all such investments, “ Cash Equivalents ”) (i) marketable direct obligations issued or unconditionally guaranteed by the United States of America or any agency thereof maturing within one year from the date of acquisition thereof, (ii) commercial paper maturing no more than one year from the date of creation thereof and currently having the highest rating obtainable from either Standard & Poor’s Ratings Group or Moody’s Investors Service, Inc., (iii) certificates of deposit maturing no more than one year from the date of creation thereof issued by commercial banks incorporated under the laws of the United States of America, each having combined capital, surplus and undivided profits of not less than $300,000,000 and having a senior unsecured rating of “A” or better by a nationally recognized rating agency (an “ A Rated Bank ”), (iv) time deposits maturing no more than thirty (30) days from the date of creation thereof with A Rated Banks, (v) mutual funds that invest substantially all of their assets in one or more of the investments described in clauses (i) through (iv)  above and (vi) investments of Foreign Subsidiaries similar to those described in clauses (i), (iii), (iv) and (v)  above of countries in which such Foreign Subsidiary is organized and deposit accounts in banks organized in any such country; (b) Borrower and any Subsidiary may make or add investments, subject to the Lien of Agent on behalf of the Lenders, (i) received in connection

 

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with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with, customers and suppliers, in each case in the ordinary course of business, or (ii) constituting (A) accounts receivable arising, (B) trade debt granted, or (C) deposits made in connection with the purchase price of goods or services, in each case in the ordinary course of business; (c) any applicable Credit Party may enter into a Permitted Intercompany Transaction; (d) guaranty obligations permitted by Sections 6.3 or 6.6; (e) noncash consideration received pursuant to any asset sale permitted under Section 6.8 ; (f) deposits and pledges in connection with Permitted Liens; (g) hedging obligations permitted by Section 6.3(vii) ; (h) the maintenance of deposit accounts in the ordinary course of business so long as the applicable provisions of Section 5.11 have been complied with in respect of such deposit accounts; (i) loans and advances to officers, directors and employees of any Credit Party in an aggregate outstanding principal amount not to exceed $1,500,000; (j) investments to the extent that payment for such investments is made with proceeds from the issuance of Stock of Parent, in an aggregate amount not to exceed $7,500,000; (k) acquisitions of obligations of one or more directors, officers, employees, members or management or consultants of Parent, the Borrower or its Subsidiaries in connection with such person’s acquisition of Stock of Parent, so long as no cash is actually advanced by any Credit Party to such persons in connection with the acquisition of any such obligations; (l) any Credit Party may make a loan or an investment that could otherwise be made as a distribution permitted under Section 6.13 (with a commensurate reduction of their ability to make additional distributions under such Section 6.13 , if applicable); (m) the Credit Parties may hold investments to the extent such investments are otherwise permitted hereunder and reflect an increase in the value thereof; (n) investments consisting of earnest money required in connection with a Permitted Acquisition; (o) any investments in joint ventures and in Cash Equivalents acquired through Permitted Acquisitions; (p) investments in and loans or advances to Subsidiaries that are not Guarantors in an aggregate outstanding principal amount not to exceed $1,000,000 at any time outstanding; (q) loans and investments described in Disclosure Schedule (6.2) ; and (r) so long as no Default or Event of Default has occurred or is continuing or would be caused thereby, Borrower and any Subsidiary may make other investments which shall not exceed in the aggregate $7,500,000, provided that, in the event that any investment is made by the Borrower or any Subsidiary in any Person through substantially concurrent interim transfers of any amount through one or more other Subsidiaries, then such other substantially concurrent interim transfers shall be disregarded for purposes of this Section 6.2 . The amount of any loan, advance or investment shall be calculated net of the amount of any repayments, returns of capital, distributions and similar amounts that would have the effect of decreasing the balance sheet investment account under a cost basis of accounting and actually received in cash by a Credit Party in respect of such loan, advance or investment.

6.3 Indebtedness . No Credit Party shall create, incur, assume or permit to exist any Indebtedness, except (without duplication) (i) Permitted Purchase Money Indebtedness, (ii) the Loans and the other Obligations (including any Incremental Facility), (iii) unfunded pension fund and other employee benefit plan obligations and liabilities to the extent permitted to remain unfunded hereunder and under applicable law, (iv) the Mezzanine Obligations and Subordinated Debt, provided that, with respect to any fundings of Mezzanine Obligations and Subordinated Debt after the Closing Date, (A) Borrower shall be in pro forma compliance with all Financial Covenants and (B) solely with respect to Subordinated Debt (x) if such Subordinated Debt is incurred on or prior to September 19, 2009, the Borrower shall have a Total Leverage Ratio not in excess of 5.31 to 1.00 and such incurrence shall result in an increase of the

 

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Total Leverage Ratio by no greater than 0.25 to 1.00, and (y) if such Subordinated Debt is incurred after September 19, 2009, the Company shall have a Total Leverage Ratio not in excess of 5.06 to 1.00 and such incurrence shall result in an increase of the Total Leverage Ratio by no greater than 0.50 to 1.00, in each case under this subsection (iv) , after giving effect to such funding and the application of proceeds thereof, (v) any other existing Indebtedness described in Disclosure Schedule (6.3)  and refinancings thereof or amendments or modifications thereof that do not have the effect of increasing the principal amount thereof (other than to add thereto any accrued interest and expenses of refinancing) or changing the maturity or amortization thereof (other than to extend the same) and that are otherwise on terms and conditions taken as a whole not materially less favorable to any Credit Party, or the Lenders, than the terms of the Indebtedness being refinanced, amended or modified, (vi) Indebtedness specifically permitted under Section 6.1, 6.2 , or 6.6 , (vii) hedging obligations under swaps, caps and collar arrangements arranged by GE Capital or provided by any Lender entered into pursuant to Section 5.10 or entered into in accordance with Section 6.16 , (viii) Indebtedness constituting a Permitted Intercompany Transaction, (ix) Indebtedness not to exceed $15,000,000 at any one time, represented by, or arising out of, subordinated obligations, earn-outs, indemnification, purchase price adjustments and similar obligations (in each case, subordinated on terms reasonably satisfactory to Agent and only to the extent such subordination is available after use of commercially reasonable efforts by the Credit Parties to obtain same) constituting a portion of the purchase price for, or incurred in connection with, Permitted Acquisitions, (x) Indebtedness incurred as a result of the financing of insurance premiums in the ordinary course of business, (xi) Permitted Subordinated Seller Debt in an aggregate amount at any time outstanding not to exceed $15,000,000, (xii) accretion or amortization of original issue discount and accretion of interest paid in kind, in each case in respect of Indebtedness otherwise permitted by this VSection 6.3 , (xiii) Indebtedness of any Credit Party to a financial institution in respect of netting services, overdraft protections, automatic clearinghouse arrangements and similar arrangements, in each case in connection with deposit accounts and cash management activities of the Credit Parties in the ordinary course of business not to exceed $3,000,000 at any one time, (xiv) Indebtedness of a person or acquired assets that is the subject of a Permitted Acquisition which Indebtedness was in existence at the time of such Permitted Acquisition and not incurred in contemplation thereof in an aggregate amount not to exceed $10,000,000 at any one time outstanding, which Indebtedness shall be unsecured or secured solely by the assets so acquired (excluding Accounts and Inventory), and (xv) other Indebtedness not to exceed $5,000,000 at any one time outstanding.

6.4 Employee Loans and Affiliate Transactions . Except to the extent otherwise expressly permitted in this Section 6 with respect to any Affiliate, no Credit Party shall enter into or be a party to any transaction with any Affiliate (other than a Credit Party) thereof except (a) upon terms that are not materially less favorable to such Credit Party than would reasonably be obtained in a comparable arm’s length transaction with a Person not an Affiliate of such Credit Party, (b) director, officer and employee compensation and reimbursements (including bonuses) and other benefits (including retirement, health, stock option and other benefit plans) and indemnification arrangements, in each case approved by the Board of Directors of such Credit Party, and (c) any transaction with an Affiliate where the only consideration paid by any Credit Party is Stock of Parent. In addition, if any such transaction or series of related transactions involves payments in excess of $1,000,000 in the aggregate, the terms of these transactions must be disclosed in advance to Agent (unless such transaction is otherwise permitted by other provisions of this Section 6) . All such transactions existing as of the date hereof are described in Disclosure Schedule (6.4) .

 

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6.5 Capital Structure and Business . Holdings and Borrower shall not (a) make any change in its capital structure as described in Disclosure Schedule (3.8) , including the issuance or sale of any shares of Stock, warrants or other securities convertible into Stock or any revision of the terms of its outstanding Stock (except as otherwise expressly permitted by this Section 6 and other than issuances of shares of Stock (i) in the case of the Borrower, to Holdings and (ii) in the case of Holdings, to Parent); or (b) amend its charter, bylaws or other organizational documents in a manner that would materially adversely affect Agent, Collateral Agent or the Lenders or adversely affect such Credit Party’s duty or ability to repay the Obligations. In addition to the covenants set forth in Section 6.18 as to Holdings, no Credit Party shall engage in any business other than the Business.

6.6 Guaranteed Indebtedness . No Credit Party shall create, incur, assume or permit to exist any Guaranteed Indebtedness except (a) by endorsement of instruments or items of payment for deposit or collection to the general account of any Credit Party, (b) for Guaranteed Indebtedness incurred for the benefit of any other Credit Party if the primary obligation is expressly permitted or not prohibited by this Agreement, provided that to the extent such primary obligation is subordinated, then the related Guaranteed Indebtedness shall be subordinated on the same terms, and (c) guarantee obligations (i) incurred in the ordinary course of business in respect of obligations of (or to) non-Affiliate suppliers, customers, franchisees, lessors and licensees or (ii) otherwise constituting investments permitted by Section 6.2 . For the avoidance of doubt, no Subsidiary of Parent shall guarantee or otherwise be obligated on the Parent Preferred Units.

6.7 Liens . No Credit Party shall create, incur, assume or permit to exist any Lien on or with respect to its Accounts or any of its other properties or assets (whether now owned or hereafter acquired) except for (a) Permitted Encumbrances; (b) Liens in existence on the date hereof and summarized on Disclosure Schedule (6.7)  and permitted refinancings, extensions and renewals thereof, including extensions or renewals of any such Liens; provided , that the principal amount of the Indebtedness so secured is not increased (other than to add thereto any accrued interest and expenses of refinancing) and the Lien does not attach to any other property; (c) Permitted Purchase Money Liens; (d) Liens securing Indebtedness related to insurance premiums permitted pursuant to Section 6.3(x) ; provided that any such Lien shall encumber only the insurance premiums financed with such Indebtedness; (e) Liens solely on any cash earnest money deposits made by Holdings or any of its Subsidiaries in connection with any letter of intent or purchase agreement permitted hereunder; (f) purported Liens evidenced by the filing of precautionary UCC financing statements relating solely to operating leases of personal property or consignments or similar arrangements entered into in the ordinary course of business; (g) pledges or deposits of cash and Cash Equivalents securing deductibles, self-insurance, co-payment, co-insurance, retentions or similar obligations to providers of property, casualty or liability insurance in the ordinary course of business; (h) Liens arising in the ordinary course of business by virtue of any contractual, statutory or common law provision relating to banker’s Liens, rights of set-off or similar rights and remedies covering deposit or securities accounts (including funds or other assets credited thereto) or other funds maintained with a depository institution or securities intermediary, so long as the applicable provisions of Section 5.11 have

 

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been complied with, in respect of such deposit or securities accounts; (i) Liens of any financial institution that has granted netting services, overdraft protections, automatic clearinghouse arrangements and similar arrangements giving rise to Indebtedness of any Credit Party permitted under Section 6.3(xiii) which are within the general parameters customary in the banking industry; (j) Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods by any Credit Party entered into in the ordinary course of business with a value not to exceed $3,000,000 at any one time; (k) Liens relating to Indebtedness and Permitted Acquisitions permitted under Section 6.3(xiv) ; provided that such Liens do not extend to property not subject to such Liens at the time of acquisition (other than improvements thereon) and are no more favorable to the lienholders than such existing Lien; and (l) other Liens securing Indebtedness not exceeding $3,000,000 in the aggregate at any time outstanding. In addition, no Credit Party shall become a party to any agreement, note, indenture or instrument, or take any other action, that would prohibit the creation of a Lien on any of its properties or other assets in favor of Collateral Agent pursuant to the Collateral Documents, as additional collateral for the Obligations, except operating leases, Capital Leases, Permitted Purchase Money Indebtedness (so long as such Lien is limited to the property purchased with the proceeds of the Purchase Money Indebtedness) or Licenses which prohibit Liens upon the assets that are subject thereto.

6.8 Sale of Stock and Assets . No Credit Party shall sell, transfer, convey, assign or otherwise dispose of any of its properties or other assets, including the Stock of any of its Subsidiaries (whether in a public or a private offering or otherwise) or any of its Accounts, other than (a) the sale of Inventory in the ordinary course of business, (b) the sale, transfer, lease, conveyance or other disposition by a Credit Party of Equipment, Fixtures or other tangible assets that are obsolete, worn-out or no longer used or useful in the Business in the ordinary course of business, (c) the sale, transfer, lease, conveyance or other disposition by a Credit Party of other assets having an aggregate cumulative fair market value in the aggregate of $15,000,000 for all such transactions consummated after the Closing Date, (d) with the approval of Agent (which such approval shall not be unreasonably withheld), the sale, transfer, conveyance or other disposition by a Credit Party of any assets as a substantially contemporaneous like-kind exchange in accordance with the IRC; provided , that the assets to be acquired have a fair market value at least as great as that of the assets being sold, transferred or disposed of, (e) the sale, transfer, conveyance or other disposition by a Credit Party to Borrower or any Guarantor (other than Holdings), (f) the licensing or sublicensing of Intellectual Property in the ordinary course of business, (g) the making of investments permitted under Section 6.2 , (h) subject to the requirements of Section 5.8 , the leasing, as lessor, of real or personal property in the ordinary course of business, (i) the disposition of any Credit Party’s interest in Proacsys, (j) mergers and consolidations in compliance with Section 6.1 , (k) discounts, dispositions or forgiveness of account receivables in the ordinary course of business or in connection with collection or compromise thereof, (l) the imposition of Permitted Liens, and (m) Dispositions as a result of condemnation by a Governmental Authority so long as the Net Cash Proceeds therefrom are applied in accordance with Section 1.3(d) . With respect to any disposition of assets or other properties permitted pursuant to clause (b), (c), (d), (g), (i) or (m) above, subject to Section 1.3(b) , the Lenders, Agent and Collateral Agent agree that its Liens on such assets shall be released upon the consummation of the applicable transaction, and Agent agrees to cause Collateral Agent to release its Lien on such assets or other properties, and to the extent such sale is of the Stock of a Subsidiary that has guaranteed the Obligations hereunder, to cause the release

 

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and termination of such Subsidiary’s guaranty, in order to permit the applicable Credit Party to effect such disposition and shall execute and deliver to Borrower or authorize the filing by Borrower, in each such case at Borrower’s expense, appropriate UCC-3 termination statements and other releases as reasonably requested by Borrower.

6.9 ERISA . No Credit Party shall, or shall cause or permit any ERISA Affiliate to, cause or permit to occur an event that could reasonably be expected to result in the imposition of a Lien against the assets of Borrower under Section 412 of the IRC or Section 302 or 4068 of ERISA or cause or permit to occur an ERISA Event to the extent such ERISA Event would reasonably be expected to have a Material Adverse Effect.

6.10 Financial Covenants . The Credit Parties shall not breach or fail to comply with any of the Financial Covenants.

6.11 [Intentionally Omitted]

6.12 Cancellation of Indebtedness; Sale-Leasebacks . No Credit Party shall cancel any claim or debt owing to it (other than debt between Credit Parties), except for reasonable consideration negotiated on an arm’s-length basis. No Credit Party shall engage in any sale-leaseback, synthetic lease or similar transaction involving any of its assets unless the sale of such property is permitted by Section 6.8 and any Indebtedness incurred in connection therewith is permitted by Section 6.3 .

6.13 Restricted Payments . No Credit Party shall make any Restricted Payment, except (a) Permitted Intercompany Transactions; (b) dividends and distributions by Subsidiaries of Borrower paid to the Credit Party that is its immediate parent company; (c) payments and distributions of officer and director compensation, reimbursement and indemnity permitted under Section 6.4(b) ; (d) payments by Borrower or any other Credit Party, or distributions from Borrower or any other Credit Party, to Parent to permit Parent to make payments of (i) Management Fees of not more than $250,000 in the aggregate in any Fiscal Year, provided that any payment of a Management Fee that is not permitted to be made as a result of the restrictions in this Agreement may be paid in a subsequent period, if, after giving effect thereto, no Default or Event of Default would exist and (ii) reimbursements of reasonable out-of-pocket expenses of Sponsor in connection with its ownership of Borrower of not more than $350,000 in the aggregate in any Fiscal Year; (e) a Credit Party may pay dividends to Parent to permit Parent to purchase equity interests from present or former officers or employees of Parent or any of its Subsidiaries in an aggregate amount after the date hereof not to exceed $7,500,000; (f) a Credit Party may pay dividends to Holdings or Parent to pay corporate overhead expenses incurred in the ordinary course of business and to Parent to pay fees and expenses to the holders of the Parent Preferred Units (so long as, in the case of payments in respect of the Parent Preferred Units, no Default or Event of Default then exists or would result after giving effect thereto and the aggregate amount of all such dividends shall not exceed $1,000,000 per Fiscal Year) and (ii) to the extent related to the Credit Parties, pay any taxes that are due and payable by Holdings or Parent as part of a consolidated group (except for any taxes incurred to the extent that the Parent Preferred Units are deemed Indebtedness); (g) payments permitted by the terms of the Mezzanine Subordination Agreement; (h) loans and advances to employees as permitted under Section 6.2(i) ; (i) subject to the subordination terms related thereto, payments of the outstanding

 

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principal of, and accrued unpaid interest on, the Permitted Subordinated Seller Debt; (j) Restricted Payments by any Credit Party or any of its Subsidiaries to pay dividends with respect to its Stock payable solely in additional shares of its common stock, (k) dividends by any non-Credit Party Subsidiary to any other holder of its equity on a pro rata basis, (1) repayments (or distributions to permit repayments by Parent) of the Subordinated Debt acceptable to the Requisite Lenders; provided , that in the case of a Restricted Payment made pursuant to clause (d)(i), (e), (i) or (1) above, no Default or Event of Default has occurred and is continuing or would result after giving effect to such Restricted Payment above. No Credit Party, nor Parent, shall make, either directly or indirectly, any redemption, purchase, retirement, dividend, defeasance, sinking fund or any other payment, prepayment of principal of, premium, if any, interest, fees or other charges or indemnities on, with respect to, or in connection with (including, without limitation, the payment of any costs or expenses relating to) the Parent Preferred Units.

6.14 Change of Corporate Name or Location; Change of Fiscal Year . No Credit Party shall (a) change its name as it appears in official filings in the state of its incorporation or other organization, (b) change its chief executive office or principal place of business, (c) change the type of entity that it is, (d) change its organization identification number, if any, issued by its state of incorporation or other organization, or (e) change its state of incorporation or organization, in each case without both giving at least thirty (30) days’ prior written notice thereof to Agent and Collateral Agent and taking any reasonable action requested by Collateral Agent in connection therewith, including to continue the perfection of any Liens in favor of Collateral Agent, on behalf of itself and the other Lenders, in any Collateral and provided that any such new location shall be in the continental United States. Without limiting the foregoing, no Credit Party shall change its name, identity or organizational structure in any manner that might make any financing or continuation statement filed in connection herewith seriously misleading within the meaning of Section 9-507(c) of the Code or any other then applicable provision of the Code except after both giving prior written notice thereof to Agent and Collateral Agent and taking any reasonable action requested by Collateral Agent in connection therewith, including to continue the perfection of any Liens in favor of Collateral Agent, on behalf of itself and the other Lenders, in any Collateral. No Credit Party shall change its Fiscal Year.

6.15 No Impairment of Intercompany Transfers . No Credit Party shall directly or indirectly enter into or become bound by any agreement, instrument, indenture or other contractual obligation (other than (i) the Loan Documents and the Mezzanine Loan Documents, (ii) customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary pending such sale, provided such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder, (iii) restrictions and conditions imposed on any Foreign Subsidiary by the terms of any Indebtedness of such Foreign Subsidiary permitted to be incurred hereunder, (iv) restrictions and conditions imposed on non-Guarantor joint ventures permitted hereunder by the terms of the agreements governing the same and (v) restrictions and conditions imposed under Indebtedness permitted under Section 6.3 with such encumbrances and restrictions that, taken as a whole, are not more restrictive than the terms hereof, and (vi) restrictions and conditions applicable to a Subsidiary acquired in a Permitted Acquisition, provided that such restriction or encumbrance (x) existed at the time such Person became a Subsidiary, (y) was not created in contemplation of or in connection with such Person

 

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becoming a Subsidiary and (z) applies only to such Subsidiary) that could directly or indirectly restrict, prohibit or require the consent of any Person with respect to the payment of dividends or distributions or the making or repayment of intercompany loans by a Subsidiary of Borrower to Borrower.

6.16 No Speculative Transactions . No Credit Party shall engage in any transaction involving commodity options, futures contracts, Obligations under any Secured Rate Contract or Rates Contract, or similar transactions, except solely to hedge against fluctuations in the prices of commodities owned or purchased by it and the values of foreign currencies receivable or payable by it and interest swaps, caps or collars with respect to Indebtedness owed by it.

6.17 Changes Relating to Mezzanine Obligations or Other Debt . No Credit Party shall (a) change or amend the terms of the Mezzanine Obligations or enter into any refinancing in connection therewith except to the extent permitted in accordance with the Mezzanine Subordination Agreement or (b) change or amend the terms of any Subordinated Debt (or any indenture or agreement in connection therewith) or refinance any such Indebtedness if the effect of such change, amendment or refinancing is to: (i) increase the cash interest rate on such Indebtedness by more than two and one-half of one percent (2.50%) per annum; (ii) change the dates upon which payments of principal or principal amount of such Indebtedness interest are due on such Indebtedness other than to extend such dates; (iii) change any default or event of default other than to delete or make less restrictive any default provision therein , or add any covenant with respect to such Indebtedness; (iv) change the redemption or prepayment provisions of such Indebtedness other than to extend the dates therefor or to reduce the premiums payable in connection therewith; (v) grant any security or collateral to secure payment of such Indebtedness (other than Permitted Liens); (vi) change or amend any other term if such change or amendment would materially increase the obligations of the Credit Party thereunder or confer additional material rights on the holder of such Indebtedness in a manner adverse to any Credit Party, Agent, Collateral Agent or any Lender; or (vii) change or amend any of the subordination provisions of such Indebtedness.

6.18 Holdings . Notwithstanding anything herein to the contrary, Holdings shall not engage in any trade or business, or own any assets (other than Stock of Borrower and assets and activities incidental thereto) or incur any Indebtedness or Guaranteed Indebtedness (other than the Obligations, the Mezzanine Obligations, the Subordinated Debt and Guaranteed Indebtedness incurred for the benefit of any other Credit Party if the primary obligation is expressly permitted by this Agreement, provided that to the extent such primary obligation is subordinated, then the related Guaranteed Indebtedness shall be subordinated on the same terms).

6.19 Management Fees . Borrower shall not amend, waive, modify, supplement or otherwise consent to any modification of any documentation evidencing or relating to the Management Fees, if any, if the effect of such amendment, waiver, modification or supplement would be to increase the Management Fees other than as permitted in Section 6.13 .

 

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VII.

TERM

7.1 Termination . The financing arrangements contemplated hereby shall be in effect until (i) the Revolving Credit Maturity Date, in the case of the Revolving Loan, and the Revolving Loan and all other Obligations relating to the Revolving Loan shall be automatically due and payable in full on such date and (ii) the Term Loan Maturity Date in the case of the Term Loan, and the Term Loan and all other Obligations relating to Term Loan shall be automatically due and payable in full on such date.

7.2 Survival of Obligations Upon Termination of Financing Arrangements . Except as otherwise expressly provided for in the Loan Documents, no termination or cancellation (regardless of cause or procedure) of any financing arrangement under this Agreement shall in any way affect or impair the obligations, duties and liabilities of the Credit Parties or the rights of Agent, Collateral Agent and Lenders relating to any unpaid portion of the Loans or any other Obligations, due or not due, liquidated, contingent or unliquidated or any transaction or event occurring prior to such termination, or any transaction or event, the performance of which is required after the Revolving Credit Maturity Date or the Term Loan Maturity Date (as the case may be). Except as otherwise expressly provided herein or in any other Loan Document, all undertakings, agreements, covenants, warranties and representations of or binding upon the Credit Parties, and all rights of Agent, Collateral Agent and each Lender, all as contained in the Loan Documents, shall not terminate or expire, but rather shall survive any such termination or cancellation and shall continue in full force and effect until the Termination Date; provided , that the provisions of Section 11 , the payment obligations under Section 1.13 and 1.14 , and the indemnities contained in the Loan Documents shall survive the Termination Date.

 

VIII.

EVENTS OF DEFAULT; RIGHTS AND REMEDIES

8.1 Events of Default . The occurrence of any one or more of the following events (regardless of the reason therefor) shall constitute an “ Event of Default ” hereunder:

(a) Borrower (i) fails to make any payment of principal of the Loans when due and payable, or (ii) fails to make any payment of interest on, or Fees owing in respect of, the Loans or any of the other Obligations (except as expressly provided in clause (iii) below) within three (3) Business Days of when due and payable, or (iii) fails to pay or reimburse Agent, Collateral Agent or Lenders for any expense reimbursable hereunder or under any other Loan Document within ten (10) days following Agent’s demand for such reimbursement or payment of expenses.

(b) Any Credit Party fails or neglects to perform, keep or observe any of the provisions of Section 1.4, 5.9 or 6 , or any of the provisions set forth in Annex F , respectively.

(c) Borrower fails or neglects to perform, keep or observe any of the provisions of Section 4 , Section 5.4(a) , Section 5.10 , Section 5.11 or any of the provisions set forth in Annex E , and the same shall remain unremedied for ten (10) Business Days or more.

(d) Any Credit Party fails or neglects to perform, keep or observe any other provision of this Agreement or of any of the other Loan Documents (other than any provision

 

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embodied in or covered by any other clause of this Section 8.1 ) and the same shall remain unremedied for thirty (30) days or more after the earlier of knowledge by an officer of any Credit Party of such default and written notice by the Agent or any Lender to any Credit Party thereof.

(e) A default or breach occurs under any other agreement, document or instrument to which any Credit Party is a party that is not cured within any applicable grace period therefor, and such default or breach (i) involves the failure to make any payment when due in respect of any Indebtedness or Guaranteed Indebtedness relating thereto (other than the Obligations and the Mezzanine Obligations) of any Credit Party in excess of $3,500,000 in the aggregate (including (x) undrawn committed or available amounts and (y) amounts owing to all creditors under any combined or syndicated credit arrangements), or (ii) causes, or permits any holder of such Indebtedness or Guaranteed Indebtedness relating thereto or a trustee to cause, Indebtedness or Guaranteed Indebtedness relating thereto or a portion thereof in excess of $3,500,000 in the aggregate to become due prior to its stated maturity or prior to its regularly scheduled dates of payment, or cash collateral to be demanded in respect thereof.

(f) Any representation or warranty herein or in any Loan Document or in any written statement, report, financial statement or certificate made or delivered to Agent, Collateral Agent or any Lender by any Credit Party is untrue or incorrect in any material respect as of the date when made or deemed made.

(g) [Intentionally omitted.]

(h) A case or proceeding is commenced against Parent or any Credit Party seeking a decree or order in respect of Parent or such Credit Party (i) under the Bankruptcy Code or any other applicable federal, state or foreign bankruptcy or other similar law, (ii) appointing a custodian, receiver, liquidator, assignee, trustee or sequestrator (or similar official) for Parent or such Credit Party or for any substantial part of Parent’s or any such Credit Party’s assets, or (iii) ordering the winding-up or liquidation of the affairs of Parent or such Credit Party, and such case or proceeding shall remain undismissed or unstayed for sixty (60) days or more or a decree or order granting the relief sought in such case or proceeding shall be entered by a court of competent jurisdiction.

(i) Parent or any Credit Party (i) files a petition seeking relief under the Bankruptcy Code or any other applicable federal, state or foreign bankruptcy or other similar law, (ii) consents to or fails to contest in a timely and appropriate manner to the institution of proceedings thereunder or to the filing of any such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee or sequestrator (or similar official) for Parent or such Credit Party or for any substantial part of Parent’s or any such Credit Party’s assets, (iii) makes an assignment generally for the benefit of creditors, (iv) takes any company or corporate action in furtherance of any of the foregoing, or (v) admits in writing its inability to, or is generally unable to, pay its debts as such debts become due.

(j) A final judgment or judgments for the payment of money in excess of $3,500,000 in the aggregate in excess of amounts covered by insurance or by an indemnity from an indemnitor reasonably acceptable to the Agent at any time are outstanding against one or more of the Credit Parties and the same are not, within thirty (30) days after the entry thereof, discharged or execution thereof stayed or bonded pending appeal, or such judgments are not discharged prior to the expiration of any such stay.

 

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(k) Any material provision of any Loan Document for any reason ceases to be valid, binding and enforceable in accordance with its terms (or any Credit Party shall challenge the enforceability of any Loan Document or shall assert in writing, or engage in any action or inaction based on any such assertion, that any provision of any of the Loan Documents has ceased to be or otherwise is not valid, binding and enforceable in accordance with its terms), or any Lien created under any Loan Document ceases to be a valid and perfected first priority Lien (except as otherwise permitted herein or therein in any of the Collateral purported to be covered thereby and except for immaterial, as reasonably determined by Agent, portions of the Collateral, and except to the extent due to the action or inaction of Agent or Collateral Agent).

(l) Any Change of Control occurs.

(m) Any “Event of Default” occurs under (and as such term is defined in) the Mezzanine Note Purchase Agreement.

(n) Except in accordance with the terms thereof, any holder of Subordinated Debt in an aggregate amount in excess of $3,500,000 or any Mezzanine Noteholder shall assert in writing that any subordination provision of the Subordination Agreement to which it is party has ceased to be or otherwise is not valid, binding and enforceable in accordance with its terms.

8.2 Remedies .

(a) (i) If any Event of Default has occurred and is continuing, Agent may (and at the written request of the Requisite Lenders shall), without notice, suspend the Revolving Loan Commitments and Swing Line Commitment with respect to additional Revolving Credit Advances, Swing Line Advances and/or the incurrence of additional Letter of Credit Obligations, whereupon any additional Revolving Credit Advances, Swing Line Advances and additional Letter of Credit Obligations shall be made or incurred in Agent’s sole discretion (or in the sole discretion of the Requisite Lenders) so long as such Event of Default is continuing.

(ii) If any Event of Default has occurred and is continuing, Agent may (and at the written request of Requisite Lenders shall), without notice except as otherwise expressly provided herein, increase the rate of interest applicable to the Obligations and the Letter of Credit Fees to the Default Rate in accordance with Section 1.5(d) .

(b) If any Event of Default has occurred and is continuing, Agent may (and at the written request of the Requisite Lenders shall), without notice: (i) terminate the Revolving Loan Commitments and the Swing Line Commitment with respect to further Revolving Credit Advances, Swing Line Advances or the incurrence of further Letter of Credit Obligations; (ii) declare all or any portion of the Obligations, including all or any portion of any Loan to be forthwith due and payable, and, upon such accelerations, require that the Letter of Credit Obligations be cash collateralized as provided in Annex B , all without presentment, demand, protest or further notice of any kind, all of which are expressly waived by Borrower and each other Credit Party; or (iii) exercise or direct Collateral Agent to exercise any rights and remedies provided to Agent or Collateral Agent under the Loan Documents or at law or equity, including

 

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all remedies provided under the Code; provided , that upon the occurrence of an Event of Default specified in Section 8.1(h) or (i) , the Revolving Loan Commitments and Swing Line Commitment shall be immediately terminated and all of the Obligations, including all Loans, shall become immediately due and payable without declaration, notice or demand by any Person.

8.3 Waivers by Credit Parties . Except as otherwise provided for in this Agreement or by applicable law, each Credit Party waives: (a) presentment, demand and protest and notice of presentment, dishonor, notice of intent to accelerate, notice of acceleration, protest, default, nonpayment, maturity, release, compromise, settlement, set-off rights, extension or renewal of any or, to the extent held by Agent or Collateral Agent at any time, all commercial paper, accounts, contract rights, documents, instruments, chattel paper and guaranties on which any Credit Party may in any way be liable, and hereby ratifies and confirms whatever Agent or Collateral Agent may do in this regard, (b) all rights to notice and a hearing prior to Agent’s or Collateral Agent’s taking possession or control of, or to Agent’s or Collateral Agent’s replevy, attachment or levy upon, the Collateral or any bond or security that might be required by any court prior to allowing Agent or Collateral Agent to exercise any of its remedies, and (c) the benefit of all valuation, appraisal, marshaling and exemption laws.

 

IX.	ASSIGNMENT AND PARTICIPATIONS; APPOINTMENT OF AGENT

9.1 Assignment and Participations.

(a) Subject to the terms of this Section 9.1 , any Lender may make an assignment to a Qualified Assignee of, or sell participations in, at any time or times, the Loan Documents, Loans, Letter of Credit Obligations and any Commitment or any portion thereof or interest therein, including any Lender’s rights, title, interests, remedies, powers or duties thereunder. Any assignment by a Lender shall: (i) require the consent of Agent (which consent shall not be unreasonably withheld or delayed with respect to a Qualified Assignee, and shall not be required for an assignment to an Affiliate or an Approved Fund of such assigning Lender) and the execution of an assignment agreement (an “ Assignment Agreement ”) substantially in the form attached hereto as Exhibit 9.1 (a)  or otherwise in form and substance reasonably satisfactory to, and acknowledged by, Agent; (ii) be conditioned on such assignee Lender representing to the assigning Lender and Agent that it is purchasing the applicable Loans to be assigned to it for its own account, for investment purposes and not with a view to the distribution thereof; (iii) after giving effect to any such partial assignment, the assignee Lender shall have Commitments in an amount at least equal to $1,000,000 and the assigning Lender shall have retained Commitments in an amount at least equal to $1,000,000 unless, in each case, (x) each of Agent and, so long as no Event of Default has occurred and is continuing, Borrower, otherwise consent (each such consent not to be unreasonably withheld or delayed), (y) the assigning Lender is assigning its entire amount of its Commitments and/or Loans, in which case such assignment shall not be subject to the foregoing minimum assignment amount, or (z) the assigning Lender is assigning to its Affiliate or Approved Fund); (iv) include a payment to Agent of an assignment fee of $3,500, provided that if an assignment by a Lender is made to an Affiliate or an Approved Fund of such assigning Lender, then no assignment fee shall be due in connection with such assignment; and (v) so long as no Event of Default has occurred and is continuing, require the consent of Borrower, which shall not be unreasonably withheld or delayed; provided that no such consent shall be required for an assignment by a Lender to another Lender, to an Affiliate of a Lender or

 

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to an Approved Fund of such Lender. In the case of an assignment by a Lender under this Section 9.1 , the assignee shall have, to the extent of such assignment, the same rights, benefits and obligations as all other Lenders hereunder. The assigning Lender shall be relieved of its obligations hereunder with respect to its Commitments or the assigned portion thereof from and after the date of such assignment. Borrower hereby acknowledges and agrees that any assignment shall give rise to a direct obligation of Borrower to the assignee and that the assignee shall be considered to be a “ Lender ”. In all instances, each Lender’s liability to make Loans hereunder shall be several and not joint and shall be limited to such Lender’s Pro Rata Share of the applicable Commitment. In the event any Lender assigns or otherwise transfers all or any part of the Obligations, any such Lender shall so notify Borrower and Borrower shall, upon the request of such Lender, execute new Notes in exchange for the Notes, if any, being assigned. Any assignment by a Lender that does not comply with this Section 9.1(a) , shall automatically be recharacterized as a participation pursuant to Section 9.1(b) .

(b) Any participation by a Lender of all or any part of its Commitments shall be made with the understanding that all amounts payable by Borrower hereunder shall be determined as if that Lender had not sold such participation, and that the holder of any such participation shall not be entitled to require such Lender to take or omit to take any action hereunder except actions directly affecting (i) any reduction in the principal amount of, or interest rate or Fees payable with respect to, any Loan in which such holder participates, (ii) any extension of the scheduled amortization of the principal amount of any Loan in which such holder participates or the final maturity date thereof, and (iii) any release of all or substantially all of the Collateral (other than in accordance with the terms of this Agreement, the Collateral Documents or the other Loan Documents). Solely for purposes of Section 1.11, 1.13, 1.14 and 9.8 , Borrower acknowledges and agrees that a participation shall give rise to a direct obligation of Borrower to the participant and the participant shall be considered to be a “ Lender ”; provided that no participant shall be entitled to any amounts payable pursuant to Section 1.13 that are in excess of the amounts to which the Lender from whom such participant obtained its participation would be entitled pursuant to Section 1.13 . Except as set forth in the preceding sentence neither Borrower nor any Credit Party shall have any obligation or duty to any participant. None of Agent, Collateral Agent nor any Lender (other than the Lender selling a participation) shall have any duty to any participant and may continue to deal solely with the Lender selling a participation as if no such sale had occurred.

(c) Except as expressly provided in this Section 9.1 , no Lender shall, as between Borrower and that Lender, or as between Agent and that Lender or as between Collateral Agent and that Lender, be relieved of any of its obligations hereunder as a result of any sale, assignment, transfer or negotiation of, or granting of participation in, all or any part of the Loans, the Notes or other Obligations owed to such Lender.

(d) Each Credit Party executing this Agreement shall use commercially reasonable efforts to assist any Lender permitted to sell assignments or participations under this Section 9.1 .

(e) Any Lender may furnish any information concerning Credit Parties in the possession of such Lender from time to time to assignees and participants (including prospective assignees and participants); provided , that such Lender shall obtain from assignees or participants confidentiality covenants substantially equivalent to those contained in Section 11.8 .

 

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(f) No Lender shall assign or sell participations in any portion of its Loans or Commitments to a Person if, as of the date of the proposed assignment or sale, such Person would be subject to capital adequacy or similar requirements under Section 1.14(a) , increased costs under Section 1.14(b) , an inability to fund LIBOR Loans under Section 1.14(c) , or withholding taxes in accordance with Section 1.13(a) .

(g) Notwithstanding anything to the contrary contained herein, any Lender (a “ Granting Lender ”), may grant to a special purpose funding vehicle (an “ SPC ”), identified as such in writing by the Granting Lender to Agent and Borrower, the option to provide to Borrower all or any part of any Loans that such Granting Lender would otherwise be obligated to make to Borrower pursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to make any Loan; and (ii) if an SPC elects not to exercise such option or otherwise fails to provide all or any part of such Loan, the Granting Lender shall be obligated to make such Loan pursuant to the terms hereof. The making of a Loan by an SPC hereunder shall utilize the Commitments of the Granting Lender to the same extent, and as if such Loan were made by such Granting Lender. No SPC shall be liable for any indemnity or similar payment obligation under this Agreement (all liability for which shall remain with the Granting Lender). Any SPC may (i) with notice to, but without the prior written consent of, Borrower and Agent and without paying any processing fee therefor assign all or a portion of its interests in any Loans to the Granting Lender or to any financial institutions (consented to by Borrower and Agent) providing liquidity and/or credit support to or for the account of such SPC to support the funding or maintenance of Loans and (ii) disclose on a confidential basis any non-public information relating to its Loans to any rating agency, commercial paper dealer or provider of any surety, guarantee or credit or liquidity enhancement to such SPC. This Section 9.1(g) may not be amended without the prior written consent of each Granting Lender, all or any of whose Loans are being funded by an SPC at the time of such amendment. For the avoidance of doubt, the Granting Lender shall for all purposes, including without limitation, the approval of any amendment or waiver of any provision of any Loan Document or the obligation to pay any amount otherwise payable by the Granting Lender under the Loan Documents, continue to be the Lender of record hereunder.

(h) Agent, acting solely for this purpose as a nonfiduciary agent of the Borrower, shall maintain at one of its offices in Chicago, Illinois or Bethesda, Maryland a copy of each Assignment Agreement delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “ Register ”). The entries in the Register shall be conclusive absent manifest error, and the Borrower, Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice. In the case of any assignment not reflected in the Register, the assigning Lender agrees that it shall maintain a comparable register as a non-fiduciary agent of the Borrower.

 

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(i) Notwithstanding anything in this Section 9.1 to the contrary, a Lender may assign any or all of its rights hereunder to an Affiliate of such Lender or an Approved Fund of such Lender without (a) providing any notice to the Agent or any other Person (including an administrative questionnaire) or (b) delivering an executed Assignment Agreement to the Agent, provided that (A) such assigning Lender shall remain solely responsible to the other parties hereto for the performance of its obligations under this Agreement, (B) the Borrower, the Agent and the other Lenders shall continue to deal solely and directly with such assigning Lender in connection with such assigning Lender’s rights and obligations under this Agreement until the requirements of Section 9.1(a) hereof have been met, including the execution and delivery of an Assignment Agreement and an administrative questionnaire, (C) the failure of such assigning Lender to deliver an Assignment Agreement or administrative questionnaire to the Agent or any other Person shall not affect the legality, validity or binding effect of such assignment, as it relates to the assigning Lender and such Affiliate or Approved Fund and (D) an Assignment Agreement between an assigning Lender and its Affiliate or Approved Fund shall be effective as of the date specified in such Assignment Agreement.

(j) Notwithstanding any other provision contained in this Agreement or any other Loan Document to the contrary, any Lender may (i) assign all or any portion of the Loans held by it to any Federal Reserve Bank or the United States Treasury as collateral security pursuant to Regulation A of the Federal Reserve Board and any Operating Circular issued by such Federal Reserve Bank, (ii) in the case of any Lender that is a fund, trust or similar entity, assign or pledge all or any portion of the Loans held by it (and Notes evidencing such Loans) to the trustee under any indenture to which such Lender is a party in support of its obligations to the trustee for the benefit of the applicable trust beneficiaries, or (iii) pledge or assign a security interest in all or any portion of the Loans held by it (and Notes evidencing such Loans) to its lenders or funding sources for collateral security purposes, provided that any payment in respect of such assigned Loans made by the Borrower to or for the account of the assigning or pledging Lender in accordance with the terms of this Agreement shall satisfy the Borrower’s obligations hereunder in respect to such assigned or pledged Loans to the extent of such payment. No such assignment or pledge shall release the assigning Lender from its obligations hereunder.

(k) Notwithstanding anything herein to the contrary, no Credit Party may be a “Lender” hereunder, and any proposed assignment by a Lender of any of its rights, privileges, duties or obligations hereunder to any Credit Party shall be void.

9.2 Appointment of Agent . GE Capital is hereby appointed to act on behalf of all Lenders as Agent (for purposes of this Section 9 , the term “ Agent ” shall also include GE Capital in its capacity as Collateral Agent pursuant to the Collateral Documents) under this Agreement and the other Loan Documents. The provisions of this Section 9.2 are solely for the benefit of Agent and Lenders and no Credit Party nor any other Person shall have any rights as a third party beneficiary of any of the provisions hereof. In performing its functions and duties under this Agreement and the other Loan Documents, Agent shall act solely as an agent of Lenders and does not assume and shall not be deemed to have assumed any obligation toward or relationship of agency or trust with or for any Credit Party or any other Person, except to the extent otherwise provided herein or in the Collateral Documents. Agent shall have no duties or responsibilities except for those expressly set forth in this Agreement and the other Loan Documents. The duties of Agent shall be mechanical and administrative in nature and Agent

 

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shall not have, or be deemed to have, by reason of this Agreement, any other Loan Document or otherwise a fiduciary relationship in respect of any Lender. Except as expressly set forth in this Agreement and the other Loan Documents, Agent shall not have any duty to disclose, and shall not be liable for failure to disclose, any information relating to any Credit Party or any of their respective Subsidiaries or any Account Debtor that is communicated to or obtained by GE Capital or any of its Affiliates in any capacity. Neither Agent nor any of its Affiliates nor any of their respective officers, directors, employees, agents or representatives shall be liable to any Lender for any action taken or omitted to be taken by it hereunder or under any other Loan Document, or in connection herewith or therewith, except for damages caused by its or their own gross negligence or willful misconduct.

If Agent shall request instructions from Requisite Lenders or all affected Lenders with respect to any act or action (including failure to act) in connection with this Agreement or any other Loan Document, then Agent shall be entitled to refrain from such act or taking such action unless and until Agent shall have received instructions from Requisite Lenders or all affected Lenders, as the case may be, and Agent shall not incur liability to any Person by reason of so refraining. Agent shall be fully justified in failing or refusing to take any action hereunder or under any other Loan Document (a) if such action would, in the opinion of Agent, be contrary to law or the terms of this Agreement or any other Loan Document, (b) if such action would, in the opinion of Agent, expose Agent to Environmental Liabilities or (c) if Agent shall not first be indemnified to its satisfaction against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. Without limiting the foregoing, no Lender shall have any right of action whatsoever against Agent as a result of Agent acting or refraining from acting hereunder or under any other Loan Document in accordance with the instructions of Requisite Lenders or all affected Lenders, as applicable.

9.3 Agent’s Reliance, Etc . Neither Agent nor any of its Affiliates nor any of their respective directors, officers, agents or employees shall be liable for any action taken or omitted to be taken by it or them under or in connection with this Agreement or the other Loan Documents, except for damages caused by its or their own gross negligence or willful misconduct as finally determined by a court of competent jurisdiction. Without limiting the generality of the foregoing, Agent: (a) may treat the payee of any Note as the holder thereof until Agent receives written notice of the assignment or transfer thereof signed by such payee and in form reasonably satisfactory to Agent; (b) may consult with legal counsel, independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken by it in good faith in accordance with the advice of such counsel, accountants or experts; (c) makes no warranty or representation to any Lender and shall not be responsible to any Lender for any statements, warranties or representations made in or in connection with this Agreement or the other Loan Documents; (d) shall not have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of this Agreement or the other Loan Documents on the part of any Credit Party or to inspect the Collateral (including the books and records) of any Credit Party; (e) shall not be responsible to any Lender for the due execution, legality, validity, enforceability, genuineness, suffic