J.B. HUNT TRANSPORT SERVICES, INC. SENIOR REVOLVING CREDIT FACILITY AGREEMENTRevolving Credit Agreement |
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Exhibit 10.1
$150,000,000
J.B. HUNT TRANSPORT SERVICES, INC.
SENIOR REVOLVING CREDIT FACILITY AGREEMENT
dated as of April 27, 2005
with
VARIOUS COMMERCIAL BANKING INSTITUTIONS as the Banks,
SUNTRUST BANK LASALLE BANK NATIONAL ASSOCIATION DEUTSCHE BANK AG NEW YORK BRANCH and THE BANK OF TOKYO-MITSUBISHI, LTD. as Co-Syndication Agents,
and
BANK OF AMERICA, N.A., as Administrative Agent
Arranged by BANC OF AMERICA SECURITIES LLC, as Sole Lead Arranger and Book Manager
TABLE OF CONTENTS
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SENIOR REVOLVING CREDIT FACILITY AGREEMENT
THIS SENIOR REVOLVING CREDIT FACILITY AGREEMENT dated as of April 27, 2005 (including the Exhibits and Schedules hereto, this “ Agreement ”) is by and among J.B. HUNT TRANSPORT SERVICES, INC., an Arkansas corporation (the “ Borrower ”), the banks and other financial institutions whose signatures appear on the signature pages hereof or which hereafter become parties hereto (collectively the “ Banks ” and individually a “ Bank ”), SUNTRUST BANK, LASALLE BANK NATIONAL ASSOCIATION, DEUTSCHE BANK AG NEW YORK BRANCH and THE BANK OF TOKYO-MITSUBISHI, LTD. (collectively the “ Co-Syndication Agents ” and individually a “ Syndication Agent ”) and BANK OF AMERICA, N.A. (“ Bank of America ”), a national banking association, as administrative agent for the Banks hereunder (in such capacity, the “ Administrative Agent ”).
RECITALS:
WHEREAS, the Borrower has requested the Banks to make loans to the Borrower and the Banks have agreed to extend a revolving credit facility to the Borrower upon the terms and conditions in this Agreement.
NOW THEREFORE, in consideration of the premises and of the mutual covenants herein contained, the parties hereto, intending legally to be bound hereby, do agree as follows:
ARTICLE I
1.1 Definitions . As used in this Agreement, unless the context requires a different meaning, the following terms (whether or not underscored) have the meanings indicated:
“ Adjusted Debt to Cash Flow Ratio ” means the ratio, expressed as a percentage, of (a) Indebtedness of the Borrower and its Subsidiaries to (b) Cash Flow.
“ Administrative Agent ” has the meaning assigned to that term in the introduction hereto.
“ Affected Bank ” means a Bank that notifies the Administrative Agent under Section 6.2(b) or Section 6.3 that it is so affected.
“ Affiliate ” of any Person means (a) any other Person who, directly or indirectly, controls or is controlled by or is under common control with such other Person or (b) in the case of the Borrower or any Subsidiary, any Person who is a director or officer of such Person or of any Person described in the foregoing clause (a) . For purposes of this definition, “control” (and with correlative meaning “controlled” and “under common control”) of a Person shall mean (i) the power, direct or indirect, (A) to vote fifty percent (50%) or more of the securities having ordinary voting power for the election of directors of such Person or (B) to direct or cause the direction of the management and policies of such Person, whether by contract or otherwise, or (ii) the ownership, direct or indirect, of ten percent (10%) or more of any class of Voting Stock of such Person (if such class of Voting Stock is publicly held).
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“ Agent-Related Persons ” means Bank of America and any successor agent arising under Section 13.2 , together with their respective Affiliates (including, in the case of Bank of America, the Arranger), and the officers, directors, employees, agents and attorneys-in-fact of such Persons and Affiliates.
“ Aggregate Outstanding Loans ” means, as at any date of determination thereof, the aggregate principal amount of all outstanding Committed Loans hereunder.
“ Agreement ” has the meaning assigned to that term in the introduction hereto.
“ Applicable Law ” with respect to any Person or matter means any law, rule, regulation, judgment, order, decree or other requirement having the force of law relating to such Person or matter and, where applicable, any interpretation thereof by any Governmental Authority having jurisdiction with respect thereto or charged with the administration or interpretation thereof.
“ Arranger ” means Banc of America Securities LLC.
“ Assignment and Assumption ” means an Assignment and Assumption substantially in the form of Exhibit G.
“ Bank Obligations ” means all obligations of any Loan Party to the Administrative Agent or the Banks, or any of them, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, joint or several, or now or hereafter existing, or due or to become due, under or in connection with this Agreement, the Notes or any other Loan Document.
“ Bank of America ” has the meaning assigned to that term in the introduction hereto.
“ Banks ” and “ Bank ” have the respective meanings assigned to those terms in the introduction hereto.
“ Base Rate ” means for any day a fluctuating rate per annum equal to the higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate.” The “prime rate” is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in such rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change.
“ Base Rate Loan ” means any Committed Loan that bears interest at a rate determined by reference to the Base Rate.
“ Base Rate Margin ” means, at any time, the then applicable Base Rate Margin, determined as set forth in the Pricing Matrix.
“ Borrower ” has the meaning assigned to that term in the introduction hereto.
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“ Borrowing ” means a borrowing by the Borrower from the Banks pursuant to Section 2.1 .
“ Borrowing Date ” means the date on which a Borrowing is, or is to be, consummated, as the context requires.
“ Business Day ” means (a) in the case of a Business Day which relates to a Eurodollar Rate Loan, a day on which the requirements of clause (c) of this definition are met, and, in addition, dealings are carried on in the interbank eurodollar market and banks are open for business in London, (b) in the case of Base Rate Loans, a day on which the requirements of clause (c) of this definition are met and, in addition, banks are open for business in New York, and (c) in the case of a Business Day which relates to fees and for any other purpose under this Agreement, a day on which the Administrative Agent is open at its address specified on Schedule 1(b) or pursuant to the provisions of Section 14.4 for the purpose of conducting commercial banking business.
“ Capital Lease ” means, with respect to any Person, any lease of (or other agreement conveying the right to use) any real or personal property by such Person that shall have been or should be recorded as a capitalized lease in accordance with GAAP.
“ Cash Flow ” means, for any period, an amount equal to the sum of the following for such period: (a) Net Income of the Borrower and its Subsidiaries plus (b) Interest Expense plus (c) taxes on income of the Borrower and its Subsidiaries plus (d) depreciation and amortization expense of the Borrower and its Subsidiaries plus (e) Rentals.
“ CERCLA ” means the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, (42 U.S.C. §9601 et seq .).
“ Change of Control Event ” means the earliest to occur of (a) the date of a public announcement that a Person or group of affiliated or associated Persons other than the current Persons who own 50% or more of the Voting Stock of the Borrower (an “ Acquiring Person ”) has acquired, or has obtained the right to acquire, legal or beneficial ownership of 50% or more of the Voting Stock of the Borrower, (b) the date an Acquiring Person acquires all or substantially all of the assets of the Borrower (for purposes hereof, the term “Acquiring Person” shall not include the Borrower, any of its Subsidiaries or any employee benefit plan (or related trust) sponsored or maintained by the Borrower or any of its Subsidiaries) and (c) the date on which a majority of the board of directors of the Borrower shall consist of Persons other than Continuing Directors (for purposes of this definition, “ Continuing Director ” means any member of the board of directors of the Borrower on the date hereof and any other member of the board of directors of the Borrower who shall be nominated or elected to succeed a Continuing Director by at least a majority of the Continuing Directors who are then members of the board of directors of the Borrower).
“ Code ” means the Internal Revenue Code of 1986.
“ Commitment ”, when used with reference to any Bank at the time any determination thereof is to be made, means the amount of such Bank’s commitment hereunder to make a Loan, which, subject to Section 12.2 , shall be the amount set forth opposite the name of such Bank on
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Schedule 1(a) , as amended from time to time (or in an Assignment and Assumption), reduced by the amount of any permanent reduction(s) in such amount pursuant to this Agreement.
“ Commitment Termination Date ” means the earlier of (i) April 27, 2010 and (ii) the date on which the Total Commitment shall be terminated pursuant to Section 4.1 or Section 12.22 .
“ Committed Loans ” has the meaning assigned to that term in Section 2.1 .
“ Compliance Certificate ” means a compliance certificate, substantially in the form of Exhibit F , duly completed.
“ Default ” means an Event of Default or an Unmatured Event of Default.
“ Default Rate ” has the meaning assigned to that term in Section 3.3 .
“ Disposition ” has the meaning assigned to that term in Section 9.9(b) .
“ Dollars ” and “ $ ” mean lawful money of the United States of America.
“ Effective Date ” means April 27, 2005.
“ Eligible Assignee ” has the meaning assigned to that term in Section 14.10 .
“ Environmental Laws ” means all statutes and ordinances of the United States and of each jurisdiction in which property of the Borrower or its Subsidiaries is located and the jurisdictions in which the Borrower or its Subsidiaries do business relating to the protection of human health or the environment, including CERCLA and RCRA, and all laws governing the generation, use, collection, treatment, storage, transportation, recovery, removal, discharge or disposal of Hazardous Materials, and the regulations adopted and publications promulgated pursuant thereto.
“ Environmental Requirements ” means all applicable present and future Environmental Laws and all rules, regulations, orders, decrees, permits, licenses, concessions, franchises, or other restrictions or requirements of any Governmental Authority relating to the protection of human health or the environment and all applicable judicial, regulatory, or administrative decrees, judgments, or orders relating to the protection of human health or the environment.
“ ERISA ” means the Employee Retirement Income Security Act of 1974.
“ Eurodollar Margin ” means, at any time, the then applicable Eurodollar Margin, determined as set forth in the Pricing Matrix.
“ Eurodollar Office ” with respect to any Bank means the office, branch or affiliate of such Bank designated on Schedule 1(b) or such other office(s), branch(es) or affiliate(s) of such Bank (as designated from time to time by written notice from such Bank to the Borrower and the Administrative Agent) which shall be making or maintaining the Eurodollar Rate Loans of such Bank hereunder.
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“ Eurodollar Rate ” means for any Loan Period, the rate per annum equal to the British Bankers Association LIBOR Rate (“ BBA LIBOR ”), as published by Reuters (or other commercially available source providing quotations of BBA LIBOR as designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Loan Period, for Dollar deposits (for delivery on the first day of such Loan Period) with a term equivalent to such Loan Period. If such rate is not available at such time for any reason, then the “Eurodollar Rate” for such Loan Period shall be the rate per annum determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the first day of such Loan Period in same day funds in the approximate amount of the Eurodollar Rate Loan being made, continued or converted by Bank of America and with a term equivalent to such Loan Period would be offered by Bank of America’s London Branch to major banks in the London interbank eurodollar market at their request at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Loan Period.
“ Eurodollar Rate (Adjusted) ” means, with respect to a particular Loan Period for any Eurodollar Rate Loan, a rate per annum determined by the Administrative Agent pursuant to the following formula:
“ Eurodollar Rate Loan ” means any Committed Loan which bears interest at a rate determined by reference to the Eurodollar Rate (Adjusted).
“ Eurodollar Reserve Percentage ” means, for any day during any Loan Period, the reserve percentage (expressed as a decimal, carried out to five decimal places) in effect on such day, whether or not applicable to any Bank, under regulations issued from time to time by the FRB for determining the maximum reserve requirement (including any emergency, supplemental or other marginal reserve requirement) with respect to Eurocurrency funding (currently referred to as “Eurocurrency liabilities”). The Eurodollar Rate for each outstanding Eurodollar Rate Loan shall be adjusted automatically as of the effective date of any change in the Eurodollar Reserve Percentage.
“ Event of Default ” has the meaning assigned to that term in Section 12.1 .
“ Exchange Act ” means the Securities Exchange Act of 1934.
“ Excluded Taxes ” has the meaning assigned to that term in the definition of the term “ Taxes .”
“ Exemption Agreement ” has the meaning assigned to that term in Section 5.3(b) .
“ Exemption Representation ” has the meaning assigned to that term in Section 5.3(c) .
“ Existing Revolving Credit Agreement ” shall mean the Senior Revolving Credit Facility Agreement dated as of November 13, 2002 by and among the Borrower, the various financial institutions that are party thereto and Bank of America, as administrative agent.
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“ Extension of Credit ” means the making of a Loan.
“ Extension of Credit Request ” means a notice of (a) a Borrowing, (b) a conversion of Committed Loans from one Type of Loan to the other, or (c) a continuation of Eurodollar Rate Loans, pursuant to Section 2.3 , which, if in writing, shall be substantially in the form of Exhibit B .
“ Facility Fee ” means, at any time, the then applicable Facility Fee, determined as set forth in the Pricing Matrix.
“ Federal Funds Rate ” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions as determined by the Administrative Agent.
“ Fee Letter ” means that certain letter agreement dated March 7, 2005 between the Borrower and the Administrative Agent, relating to the payment of fees to the Administrative Agent.
“ Fiscal Quarter ” means each fiscal quarter of the Borrower and its Subsidiaries.
“ Fiscal Year ” means each fiscal year of the Borrower and its Subsidiaries.
“ Fixed Charge Coverage Ratio ” means for each Fiscal Quarter the ratio of (a) Net Income for the four Fiscal Quarters then ended, after adding back, but only to the extent previously deducted in determining Net Income and without duplication, the sum for the four Fiscal Quarters then ended of (i) taxes on income of the Borrower and its Subsidiaries, plus (ii) Interest Expense, plus (iii) Rentals, divided by (b) the sum for the four Fiscal Quarters then ended of (y) Interest Expense plus (z) Rentals.
“ FRB ” means the Board of Governors of the Federal Reserve System.
“ Fund ” has the meaning assigned to that term in Section 14.10 .
“ GAAP ” means generally accepted accounting principles as in effect from time to time (except as otherwise provided in Section 1.2(a)) as set forth in the opinions, statements and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants, the Financial Accounting Standards Board and such other Persons who, shall be approved by a significant segment of the accounting profession and concurred in by the independent certified public accountants certifying any audited financial statements of the Borrower.
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“ Governmental Authority ” means any government (or any political subdivision or jurisdiction thereof), court, bureau, agency or other governmental authority having jurisdiction over the Borrower or any Subsidiary, or any of its or their business, operations or properties.
“ Granting Bank ” has the meaning assigned to that term in Section 14.10 .
“ Guarantor ” means Transport or any other Subsidiary that executes a Subsidiary Guaranty.
“ Guaranty ” of a Person means any guaranty, assumption, endorsement, or contingent agreement to purchase or provide funds for the payment of, or otherwise become liable upon, the obligation of any other Person, or any agreement to maintain the net worth or working capital or other financial condition of any other Person or any other assurance to any creditor of any Person against loss, including any comfort letter, operating agreement, take-or-pay contract, or the contingent liability of such Person in connection with any application for a letter of credit, excepting from the foregoing contingent liabilities the amount of such Person’s obligations with respect to bonds, deposits, standby letters of credit or other evidences of contingent obligations given to governmental entities in compliance with local and state requirements that have not been drawn or called upon.
“ Hazardous Materials ” means materials defined as “hazardous substances,” “hazardous waste” or “hazardous constituents” or any similar term in (a) CERCLA, (b) RCRA or (c) any other Environmental Requirements.
“ Highest Lawful Rate ” has the meaning assigned to that term in Section 3.8(b) .
“ Impermissible Qualification ” means, relative to any opinion by the Borrower’s independent public accountants as to any financial statement of the Borrower or any of its Subsidiaries, any qualification or exception to such opinion:
(a) which is of a “going concern” or a similar nature;
(b) which relates to the limited scope of examination of matters relevant to such financial statement (other than scope limitations included in the standard form of opinion utilized by such accountants);
(c) which relates to the treatment or classification of any item in such financial statement and which, as a condition to its removal, would require an adjustment to such item the effect of which would be to cause the Borrower to be in default of any of its obligations under Section 9.2 through Section 9.7 ; or
(d) with respect to the absence of any material misstatement in such financial statements.
“ Indebtedness ” with respect to any Person means, without duplication, (a) all indebtedness for borrowed money of such Person or for the deferred purchase price of property acquired by, or for services rendered to (other than trade payables), such Person, (b) all indebtedness of such Person created or arising under any conditional sale or other title retention
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agreement with respect to any property acquired by such Person, (c) the present value determined in accordance with GAAP of all obligations of such Person under Capital Leases, (d) all indebtedness for borrowed money or for the deferred purchase price of property or services secured by any Lien upon or in any property owned by such Person whether or not such Person has assumed or become liable for the payment of such indebtedness for borrowed money, (e) indebtedness arising under acceptance facilities, (f) any asserted withdrawal liability of such Person or a commonly controlled entity to a Multiemployer Plan, (g) all amounts of indebtedness which (x) represent recourse liabilities of such Person with respect to Securitized Receivables Transactions and which, (y) in accordance with GAAP, would be included on a balance sheet of such Person in respect of any Securitized Receivables Transactions if such facility were characterized as Indebtedness secured by Receivables rather than as a sale of assets, (h) all Guaranties by such Person, and (i) the present value of the minimum aggregate operating lease payments, determined on a consolidated basis in accordance with GAAP, payable by such Person pursuant to Long-Term Leases, discounted at 8%.
“ Indemnified Liabilities ” shall have the meaning assigned to that term in Section 14.6 .
“ Indemnitee ” shall have the meaning assigned to that term in Section 14.6 .
“ Intangible Assets ” of any Person means all licenses, franchises, patents, patent applications, trademarks, program rights, goodwill and research and development expense or other like intangibles shown on a balance sheet of such Person, as determined in accordance with GAAP.
“ Interest Expense ” means, without duplication, for any period, the sum of (a) aggregate interest expense of the Borrower and its Subsidiaries for such period, as determined in accordance with GAAP and in any event including, without duplication, all commissions, discounts and other fees and charges owed with respect to letters of credit and banker’s acceptances and net costs under interest rate protection agreements and the portion of any obligation under Capital Leases allocable to interest expense; plus (b) aggregate interest expense of the Borrower and its Subsidiaries capitalized during such period; plus (c) Receivables Charges of the Borrower and its Subsidiaries for such period under any Securitized Receivables Transaction.
“ Internal Control Event ” means, with respect to the Borrower or any Subsidiary, a determination by management of the Borrower or by the Borrower’s Public Accountants (i) that a material weakness in internal controls over financial reporting, as described in PCAOB Auditing Standard No. 2, exists in the Borrower’s or any Subsidiary’s internal control over financial reporting, or (ii) a member of the senior management of the Borrower or any Subsidiary has committed an act of fraud of any magnitude.
“ Investment ” of any Person means any loan, advance, extension of credit, or capital contribution to, investment in, purchase or acquisition of any stock, notes, debt, obligations or securities of, or any other interest in, any Person.
“ Lien ” as applied to the property of any Person means (a) any mortgage, pledge, lien, security interest, charge, encumbrance, or preference, priority or other security interest of any
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kind or nature whatsoever, including the retained security title of a conditional vendor or lessor, including Capital Leases and the interest of a purchaser of accounts receivable; and (b) any arrangement, express or implied, under which any property of such Person is transferred, sequestered or otherwise identified for the purpose of subjecting the same to the payment of Indebtedness or performance of any other obligation in priority to the payment of the general, unsecured creditors of such Person.
“ Loan Documents ” means, collectively, this Agreement, the Notes, the Fee Letter and each Subsidiary Guaranty.
“ Loan Party ” means the Borrower or any Guarantor.
“ Loan Period ” means, with respect to any Committed Loan, the period from the Borrowing Date for such Committed Loan and ending (a) on the Commitment Termination Date, in the case of a Base Rate Loan, and (b) one, two, three or six months (and if offered by all Banks, nine or twelve months) thereafter, in the case of a Eurodollar Rate Loan, as the Borrower shall specify in the related notice of Borrowing and Extension of Credit Request pursuant to Section 2.3 ; provided , however , that:
(i) if the Borrower does not specify any Loan Period for any Eurodollar Rate Loan in the related notice of Borrowing and Extension of Credit Request pursuant to Section 2.3 , such Loan Period shall be the period starting on the Borrowing Date for such Eurodollar Rate Loan and ending one month thereafter;
(ii) if a Loan Period for any Eurodollar Rate Loan would otherwise end on a day which is not a Business Day, such Loan Period shall end on the next succeeding Business Day (unless such next succeeding Business Day is the first Business Day of a calendar month, in which case such Loan Period shall end on the next preceding Business Day);
(iii) no Loan Period may end later than the Commitment Termination Date, and if a Loan Period determined under clause (i) above, or otherwise, would end after the Commitment Termination Date, such Loan Period shall end on the Commitment Termination Date; and
(iv) in the case of a Loan Period for a Eurodollar Rate Loan, if there exists no day numerically corresponding to the Borrowing Date for such Loan in the month in which the last day of such Loan Period would otherwise fall, such Loan Period shall end on the last Business Day of such month.
“ Loans ” and “ Loan ” respectively mean (a) all loans made by the Banks or a single Bank (as the context requires) to the Borrower pursuant to Article II , and (b) a single such loan made by any Bank.
“ Long-Term Lease ” means any lease (other than any Capital Lease) of real property or Revenue-Generating Equipment having an original term (including any required renewals or any renewals at the option of lessor) of one year or more.
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“ Majority Banks ” at the time any determination thereof is to be made and for any specific purpose means Banks having Percentages aggregating more than 50% of the Percentages of all Banks.
“ Materially Adverse Effect ” means, relative to any occurrence of whatever nature (including any adverse determination in any litigation, arbitration or governmental investigation or proceeding) and after taking into account uncontested insurance coverage and effective uncontested indemnifications with respect to such occurrence, a materially adverse effect (a) on a consolidated basis for the Borrower and its Subsidiaries in accordance with GAAP, on the consolidated condition (financial or otherwise), business, assets, liabilities (actual or contingent) operations, properties or prospects of the Borrower and its Subsidiaries; (b) on the ability of any Loan Party to perform any of its payment or other material obligations under this Agreement or any other Loan Document; or (c) upon the legality, validity, binding effect or enforceability against the Borrower or any Guarantor of any Loan Document.
“ Moody’s ” means Moody’s Investors Service, Inc. and any successor thereto that is a nationally recognized debt rating agency, or, if neither Moody’s Investor Service, Inc. nor any such successor shall be in the business of rating senior unsecured long-term debt, a nationally recognized debt rating agency headquartered in the United States of America jointly selected by the Administrative Agent and the Borrower; provided that if the Administrative Agent and the Borrower fail to agree upon any such selection within five (5) Business Days after notice by the Administrative Agent to the Borrower requesting its agreement with such a selection, such selection shall be made by the Administrative Agent.
“ Multiemployer Plan ” means any “multiemployer plan” (as that term is defined under Section 3(37) of ERISA) under which the Borrower or any Related Person has contributed or with respect to which the Borrower or such Related Person may have any liability.
“ Net Income ” means, for any period, (a) the gross revenues of the Borrower and its Subsidiaries for such period; reduced by (b) the sum (without duplication) of the following items for such period (to the extent, except in the case of clause (i) , included in such gross revenues):
(i) operating and non-operating expenses of the Borrower and its Subsidiaries according to GAAP (including current and deferred taxes on income, provision for taxes on unremitted foreign earnings included in such gross revenues and current additions to reserves but excluding the lower of cost or market inventory write-downs and write-ups of current assets);
(ii) all material gains (net of expense and taxes applicable thereto) arising from the sale, conversion or other disposition of capital assets (i.e., assets other than current assets), other than gains or losses arising from sales in the ordinary course of business of revenue equipment;
(iii) all gains arising from the write-up of assets (other than the write-up of current assets as a result of the lower of cost or market adjustments to inventory);
(iv) all gains arising from the reacquisition of Indebtedness;
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(v) all equity of the Borrower or any Subsidiary in the unremitted earnings of any Person in which the Borrower has a minority interest;
(vi) all earnings of each Person acquired by the Borrower or any Subsidiary through purchase of substantially all assets, merger, consolidation or otherwise for any period prior to the date of acquisition;
(vii) all deferred credits representing the excess of equity in any Subsidiary at the date of acquisition thereof over the cost of the investment in such Subsidiary;
(viii) any portion of net earnings of any Subsidiary which for any reason is unavailable for the payment of dividends to the Borrower or any other Subsidiary; and
(ix) the aggregate amount of dividends paid by all Subsidiaries to the Borrower or to any Subsidiary during such period.
“ Net Worth ” means at any time the sum of capital stock, additional paid-in capital and retained earnings ( minus accumulated deficits) of the Borrower and its Subsidiaries as determined in accordance with GAAP.
“ Notes ” and “ Note ” respectively mean (a) the promissory notes of the Borrower, substantially in the form of Exhibit A , duly completed, respectively evidencing Committed Loans made to the Borrower by the Banks, and (b) a single such promissory note.
“ Notice Date ” has the meaning assigned to that term in Section 6.1(c) .
“ Officer’s Certificate ” means a certificate in the form of Exhibit D-1 or D-2 (appropriately completed), signed by the President, Vice President, Treasurer, Secretary or an Assistant Secretary of a Loan Party authorized to certify as to the matters therein set forth.
“ Participant ” has the meaning assigned to that term in Section 14.10 .
“ PBGC ” means the Pension Benefit Guaranty Corporation created by Section 4002(a) of ERISA or any successor thereto.
“ Percentage ” when used with reference to any Bank at the time any determination thereof is to be made means a fraction, expressed as a percentage, the numerator of which shall be the amount of such Bank’s Commitment then in effect and the denominator of which shall be the Total Commitment then in effect; provided that if the respective Commitments of the Banks, and the Total Commitment, have then been terminated, the numerator of such fraction shall be the principal amount of the Aggregate Outstanding Loans then owing to such Bank and the denominator of such fraction shall be the principal amount of the Aggregate Outstanding Loans then owing to all of the Banks.
“ Permits ” has the meaning assigned to such term in Section 8.7 .
“ Permitted Investments ” means any one or more of the following:
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(a) Investments, loans and advances by the Borrower and its Subsidiaries in and to Subsidiaries, including any Investment in a corporation which, after giving effect to such Investment, will become a Subsidiary and loans and advances by a wholly-owned Subsidiary to the Borrower;
(b) Investments, maturing in twelve months or less from the date of acquisition, in direct obligations of the United States of America, or any agency thereof;
(c) Investments in corporate debt obligations, maturing within twelve months or less from the date of acquisition, which (i) are issued by (x) any of the Banks or (y) corporations having substantially all of their assets located in the United States, and (ii) at the time of acquisition, are accorded a rating of A, or better, by S&P or A, or better, by Moody’s (or an equivalent rating by another nationally recognized credit rating agency of similar standing if neither of such agencies is then in the business of rating long-term corporate debt obligations);
(d) Investments in commercial paper which (i) is issued by (x) any of the Banks or (y) by corporations having substantially all of their assets located in the United States, (ii) matures in 270 days or less from the date of acquisition and, (iii) at the time of acquisition, is accorded a rating of A-1, or better, by S&P or P-1, or better, by Moody’s (or an equivalent rating by another nationally recognized credit rating agency of similar standing if neither of such agencies is then in the business of rating commercial paper);
(e) Investments in certificates of deposit, maturing within twelve months or less from the date of acquisition, (i) which are issued by (x) any of the Banks or (y) by other commercial banks located in the United States having capital, surplus and undivided profits aggregating more than $500,000,000, and (ii) the issuer of which, at the time of acquisition, is accorded a rating of A, or better, by S&P or A, or better, by Moody’s (or an equivalent rating by another nationally recognized credit rating agency of similar standing if neither of such agencies is then in the business of rating long-term unsecured corporate debt obligations) with respect to its outstanding unsecured long-term indebtedness;
(f) Investments in marketable obligations, maturing within twelve months or less from the date of acquisition, of any state, territory or possession of the United States of America or any political subdivision of any of the foregoing, or the District of Columbia, which are, at the time of acquisition, accorded a rating of AA, or better, by S&P or Aa, or better, by Moody’s (or an equivalent rating by another nationally recognized credit rating agency of similar standing if neither of such agencies is then in the business of rating municipal obligations);
(g) Investments in Receivables arising in the ordinary course of business of the Borrower and its Subsidiaries;
(h) Investments in Transplace, Inc. existing on the Effective Date;
(i) other Investments (in addition to those permitted by the foregoing clauses (a) through (h) ), provided that the aggregate amount of all such other Investments
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(calculated at the original book value or principal amount of such Investments, without regard to gain or loss, reduced only by the amount, if any, of cash distribution and principal repayments received with respect to such Investments), plus all Guaranties at any time held or made by the Borrower and its Subsidiaries (other than Guaranties by Transport of the Indebtedness of the Borrower and any Subsidiary Guaranty) shall not at any time exceed an amount equal to ten percent (10%) of Net Worth; and
(j) Investments in the following types of auction rate securities that bear a rating of “A” or higher by a nationally recognized credit rating agency: (a) auction rate preferred stocks eligible for the dividend received deduction (commonly called D.R.D. preferreds) for corporate holders and such security is issued by a domestic or foreign corporation, (b) auction rate preferred stocks issued by U.S. municipalities and the dividends paid on which are not taxable by the U.S. Federal government or state governments (commonly called tax-exempt preferreds) for the holder of the security, (c) auction rate preferred stocks issued by corporations based in the United Kingdom and whose income received is subject to the “US — UK Treaty on Double Taxation” (commonly called UK Preferreds) for the United States—based holder of the security, and (d) auction rate preferred debt and equity securities issued by domestic and foreign corporations and the dividends paid on which are fully taxable by both the U.S. Federal and state governments (commonly called taxable preferreds) for the holder of the security.
“ Permitted Liens ” of the Borrower and its Subsidiaries means:
(a) Liens for taxes, assessments, or governmental charges or levies not yet due or which are being actively contested in good faith by appropriate proceedings, so long as reserves have been established to the extent required by GAAP;
(b) other Liens incidental to the conduct of their business or the ownership of their property and assets (such as common carrier’s Liens, producer’s Liens, mechanic’s Liens, and other similar statutory and non-consensual Liens) which were not incurred in connection with the borrowing of money or the obtaining of advances or credit, and which do not in the aggregate materially detract from the value of their property or assets or materially impair the use thereof in the operation of their business;
(c) any Lien existing on any property of any corporation at the time it becomes a Subsidiary or existing prior to the time of acquisition upon any property acquired by the Borrower or any Subsidiary through purchase, merger or consolidation or otherwise, whether or not assumed by the Borrower or such Subsidiary, or placed upon property at the time of its acquisition by the Borrower or any Subsidiary to secure a portion of the purchase price thereof, or placed upon property hereafter acquired by the Borrower or any Subsidiary at the time of the acquisition thereof; provided (i) that at the time of creation of such Lien the principal amount of debt secured thereby does not exceed the amounts otherwise permitted by clause (h) of this definition, and (ii) that any such Lien shall not encumber any other property of the Borrower or such Subsidiary;
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(d) Liens on any property or assets of the Borrower or any Subsidiary existing on the date hereof as set forth on Schedule 4 and Liens, if any, which are the subject of a Securitized Receivables Transaction but only with respect to the Receivables sold;
(e) any Lien renewing, extending or replacing any Lien permitted by clause (d) above, provided that the principal amount secured and then outstanding is not increased, the Lien is not extended to other property and the Indebtedness secured thereby is permitted hereunder;
(f) deposits, bonding arrangements and Liens to secure the performance of (or to secure obligations in respect of letters of credit posted to secure the performance of) bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business;
(g) any attachment or judgment Lien which is being contested in good faith by appropriate proceedings for which adequate reserves have been established in accordance with GAAP; and
(h) Liens (not otherwise prohibited by this Agreement) on any property or assets of the Borrower or any Subsidiary acquired in each case after the Effective Date to secure Indebtedness under Capital Leases or Indebtedness incurred at the time of acquisition of any property to finance a portion of the purchase price thereof; provided that such Lien attaches only to such property.
“ Permitted Securitized Receivables Transaction ” means any Securitized Receivables Transaction to the extent that the aggregate investment or claims held at any time by all purchasers, assignees, transferees or (or of interests in) receivables and other rights to payment in all Securitized Receivables Transactions would at any time not exceed $100,000,000.
“ Person ” means an individual or a corporation, partnership, trust, incorporated or unincorporated association, joint venture, joint stock company, limited liability company, government (or an agency or political subdivision thereof) or other entity of any kind.
“ Plan ” means any plan described in Section 4021(a) of ERISA and not excluded pursuant to Section 4021(b) thereof, under which the Borrower or any Related Person to the Borrower has contributed or with respect to which the Borrower or such Related Person is liable.
“ Platform ” has the meaning assigned to that term in Section 8.1 .
“ Pricing Matrix ” means the Pricing Matrix as set forth on Schedule 6 .
“ Pro Rata Distribution Event ” has the meaning assigned to that term in Section 5.4(c) .
“ Process Agent ” means CT Corporation System or any successor thereto.
“ Public Accountant ” has the meaning assigned to that term in Section 8.1(b)(i) .
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“ Quarterly Payment Date ” means the last Business Day of each March, June, September, and December of each year.
“ RCRA ” means the Resource Conservation and Recovery Act of 1976 (42 U.S.C. §6901 et seq).
“ Receivable ” of any Person means, as at any date of determination thereof, the unpaid principal portion of the obligation of any customer of such Person to pay money to such Person in respect of any services performed by such Person or inventory purchased from such Person, net of all credits, rebates and offsets owed to such customer by such Person and also net of all commissions payable by such Person to third parties (and for purposes hereof, a credit or rebate paid by check or draft of such Person shall be deemed to be outstanding until such check or draft shall have been debited to the respective account of such Person on which such check or draft was drawn).
“ Receivables Charges ” means any charges, fees, interest expense, discounts, or similar items incurred by the Borrower or its Subsidiaries in connection with the sale, transfer, or assignment by such Person of Receivables of such Person.
“ Recipient ” has the meaning assigned to that term in Section 5.3.
“ Recipient Taxes ” has the meaning assigned to that term in Section 5.3(a) .
“ Register ” shall have the meaning assigned to that term in Section 14.10 .
“ Regulation D ” has the meaning assigned to that term in Section 6.1(a)(i) .
“ Related Person ” with respect to any Person means any other Person which, together with such Person, is under common control as described in Section 414 of the Code.
“ Rentals ” means the aggregate fixed amounts payable by the Borrower and its Subsidiaries under any lease of real property or Revenue-Generating Equipment having an original term (including any required renewals or any renewals at the option of lessor) of one year or more but does not include any amounts payable under any Capital Lease of property by the Borrower or its Subsidiaries, as lessee.
“ Reportable Event ” means a “reportable event” described in Section 4043(b) of ERISA.
“ Responsible Officer ” means the President, the Chief Financial Officer or the Treasurer of the relevant Loan Party.
“ Revenue-Generating Equipment ” means tractors, trailers, containers or chassis.
“ S&P ” means Standard and Poor’s Ratings Services or any successor thereto that is a nationally recognized debt rating agency, or, if neither Standard and Poor’s Ratings Services nor any such successor shall be in the business of rating senior unsecured long-term debt, a nationally recognized debt rating agency headquartered in the United States of America jointly selected by the Administrative Agent and the Borrower; provided that if the Administrative
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Agent and the Borrower fail to agree upon any such selection within five Business Days after notice by the Administrative Agent to the Borrower requesting its agreement with such a selection, such selection shall be made by the Administrative Agent.
“ Sale-Leaseback Transaction ” means any arrangement whereby the Borrower or any Subsidiary shall sell, transfer or otherwise dispose of any of its property which it has owned and occupied (in the case of real property) or owned (in the case of property other than real property), and then or thereafter rent or lease, as lessee, such property or any part thereof (except any such arrangements pursuant to which one or more Subsidiaries shall sell, transfer or otherwise dispose of such property to the Borrower and thereafter lease such property from the Borrower).
“ Sarbanes-Oxley ” means the Sarbanes-Oxley Act of 2002.
“ SEC ” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions. “ Securities Laws ” means the Securities Act of 1933, the Securities Exchange Act of 1934, Sarbanes-Oxley and the applicable accounting and auditing principles, rules, standards and practices promulgated, approved or incorporated by the SEC or the Public Company Accounting Oversight Board, as each of the foregoing may be amended and in effect on any applicable date hereunder.
“ Securitized Receivables Transaction ” means a sale, transfer, conveyance, lease, or assignment by Borrower and its Subsidiaries of Receivables of the Borrower or its Subsidiaries created after the Effective Date, in connection with any one or more transactions involving the securitization of such Receivables.
“ Senior Indebtedness ” means, at any time, the Indebtedness of the Borrower and its Subsidiaries which is not Subordinated Indebtedness, including any recourse liability of the Borrower resulting from a Securitized Receivables Transaction.
“ SPC ” has the meaning assigned to that term in Section 14.10 .
“ Subordinated Indebtedness ” means all unsecured Indebtedness of the Borrower which is made subordinate and junior in right of payment to the Bank Obligations of the Borrower by the inclusion in the instrument evidencing or creating such Indebtedness or the indenture or other instrument under which such Indebtedness is issued of subordination provisions and terms acceptable to the Administrative Agent and the Majority Banks.
“ Subsidiary ” means any corporation, partnership, association, limited liability company, or other business entity of which 50% or more of the Voting Stock or other equity interests, as appropriate, is at the time directly or indirectly owned by the Borrower, by the Borrower and one or more other Subsidiaries, or by one or more other Subsidiaries.
“ Subsidiary Guaranty ” means each Guaranty substantially in the form of Exhibit C executed by a Guarantor in favor of the Banks, and delivered to the Administrative Agent.
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“ Taxes ” with respect to any Person means taxes, assessments and other governmental charges or levies imposed upon such Person, its income or any of its properties, franchises or assets (excluding, in the case of payments made to any Bank or the Administrative Agent, taxes imposed upon its overall net income and franchise taxes imposed upon it by the jurisdiction under the laws of which such Bank or Administrative Agent, as the case may be, is organized or any political subdivision thereof and franchise taxes imposed upon it by the jurisdiction in which such Bank’s or Administrative Agent’s lending office is located or any political subdivision thereof, all such Taxes being “ Excluded Taxes ”).
“ Total Commitment ” at the time any determination thereof is to be made means the sum of the then Commitments of the Banks.
“ Transport ” shall mean J.B. Hunt Transport, Inc., a Georgia corporation and a wholly-owned Subsidiary of the Borrower.
“ Type of Loan ” has the meaning assigned to that term in Section 2.2 .
“ Unfunded Vested Liability ” means, relative to any Plan, including any Multiemployer Plan, at any time, the excess (if any) of (a) the present value of all vested nonforfeitable benefits under such Plan or such Multiemployer Plan, as the case may be, over (b) the fair market value of all Plan assets or Multiemployer Plan assets, as the case may be, allocable to such benefits, all determined as of the then most recent valuation date for such Plan or such Multiemployer Plan, as the case may be, but only to the extent that such excess represents a potential liability of any Loan Party to the PBGC, such Plan or such Multiemployer Plan tinder Title IV of ERISA.
“ Unmatured Event of Default ” means an event, act or occurrence that, with the giving of notice or the lapse of time (or both), would become an Event of Default.
“ US Person ” means any citizen, national or resident of the United States, any corporation or other entity created or organized in or under the laws of the United States or any political subdivision thereof or any estate or trust, in each case that is subject to United States Federal income taxation regardless of the source of its income.
“ Utilization Fee ” has the meaning assigned to that term in Section 5.1(c) .
“ Voting Stock ” shall mean, with respect to any Person, any class of shares of stock or other equity interests of such Person having general voting power under ordinary circumstances to elect a majority of the board of directors or other managing entities, as appropriate, of such Person (irrespective of whether or not at the time stock of any other class or classes or other equity interests of such Person shall have or might have voting power by reason of the happening of any contingency).
“ Welfare Plan ” means a “welfare plan,” as such term is defined in Section 3(1) of ERISA.
1.2 Interpretation . In this Agreement and each other Loan Document, unless a clear contrary intention appears:
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(a) accounting terms used but not defined herein shall be construed in accordance with GAAP, and whenever the character or amount of any asset or liability or item of income or expense is required to be determined, or any consolidation or other accounting computation is required to be made, for purposes hereof, such determination or computation shall be made in accordance with GAAP; provided that such determinations and computations with respect to financial covenants and ratios hereunder shall be made in accordance with GAAP as applied to statements dated December 31, 2004;
(b) the singular number includes the plural number and vice versa;
(c) reference to any Person includes such Person’s successors and assigns unless such successors and assigns are not permitted by this Agreement, and reference to a Person in a particular capacity excludes such Person in any other capacity or individually;
(d) reference to any gender includes the other gender;
(e) reference to any agreement (including this Agreement and the Schedules and Exhibits hereto), document or instrument means such agreement, document or instrument as amended or modified and in effect from time to time in accordance with the terms thereof and, if applicable, the terms hereof and reference to any promissory note includes any promissory note which is an extension or renewal thereof or in substitution or replacement therefor;
(f) reference to any Applicable Law means such Applicable Law as amended, modified, codified or reenacted, in whole or in part, and in effect from time to time, including rules and regulations promulgated thereunder;
(g) unless the context indicates otherwise, reference to any Article , Section , Schedule or Exhibit in this Agreement or any other Loan Document means such Article or Section hereof or of such other Loan Document, as the case may be, or such Schedule or Exhibit hereto or to such other Loan Document, as the case may be;
(h) “hereunder,”‘ “hereof,” “hereto” and words of similar import shall be deemed references to this Agreement or to such other Loan Document, as the case may be, as a whole and not to any particular Article , Section or other provision hereof or thereof;
(i) “including” (and with correlative meaning “include”) means including without limiting the generality of any description preceding such term; and
(j) with respect to the determination of any period of time, “from” means “from and including” and “to” means “to but excluding.”
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2.1 Commitments . Each Bank, severally and for itself alone, on the terms and subject to the conditions hereinafter set forth, hereby agrees to make loans (the “Committed Loans”) to the Borrower on a revolving basis from time to time on or after the date hereof and prior to the Commitment Termination Date in an aggregate principal amount at any one time outstanding not to exceed such Bank’s Commitment. The aggregate principal amount of Committed Loans which the Banks shall be committed to make to the Borrower on any day shall not exceed an amount which, when added (without duplication) to the Aggregate Outstanding Loans on such day (after giving effect to the incurrence or repayment of any outstanding Loans on such day), would exceed the Total Commitment. Within the foregoing limit, and subject to the terms and conditions hereinafter set forth, the Borrower may borrow pursuant to this Section 2.1 , repay pursuant to Section 3.1 , prepay pursuant to Section 4.2 , Section 6.3(c) , or Section 6.6 , and reborrow in accordance with this Section 2.1 .
2.2 Types of Committed Loans . Each Committed Loan shall be either a Base Rate Loan or a Eurodollar Rate Loan (each being herein called a “ Type of Loan ”), as the Borrower shall specify in the related notice of Borrowing pursuant to Section 2.3 .
2.3 Borrowing, Conversion and Continuation Procedures with Respect to Committed Loans .
(a) Each Borrowing, each conversion of Committed Loans from one Type of Loan to the other, and each continuation of Eurodollar Rate Loans shall be made upon the Borrower’s irrevocable notice to the Administrative Agent, which may be given by telephone. Each such notice must be received by the Administrative Agent not later than 10:30 a.m., Chicago time (i) three Business Days prior to the requested date of any Borrowing of, conversion to or continuation of Eurodollar Rate Loans or of any conversion of Eurodollar Rate Loans to Base Rate Loans, and (ii) on the requested date of any Borrowing of Base Rate Loans. Each telephonic notice by the Borrower pursuant to this Section 2.3(a) must be confirmed promptly by delivery to the Administrative Agent of a written Extension of Credit Request, appropriately completed and signed by a Responsible Officer of the Borrower. Each Borrowing of, conversion to or continuation of Eurodollar Rate Loans shall be in a principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof. Each Borrowing of or conversion to Base Rate Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof. Each Extension of Credit Request (whether telephonic or written) shall specify (i) whether the Borrower is requesting a Borrowing, a conversion of Committed Loans from one Type of Loan to the other, or a continuation of Eurodollar Rate Loans, (ii) the requested date of the Borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (iii) the principal amount of Committed Loans to be borrowed, converted or continued, (iv) the Type of Loans to be borrowed or to which existing Committed Loans are to be converted, and (v) if applicable, the duration of the Loan Period with respect thereto. If the Borrower fails to specify a Type of Loan in an Extension of Credit Request or if the Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable Committed Loans shall be made as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective as of the last day of the Loan Period then in effect with respect to the applicable Eurodollar Rate Loans. If the Borrower requests a Borrowing of, conversion
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to, or continuation of Eurodollar Rate Loans in any such Extension of Credit Request, but fails to specify a Loan Period, it will be deemed to have specified a Loan Period of one month.
(b) Following receipt of an Extension of Credit Request, the Administrative Agent shall promptly notify each Bank of the amount of its Percentage of the applicable Committed Loans, and if no timely notice of a conversion or continuation is provided by the Borrower, the Administrative Agent shall notify each Bank of the details of any automatic conversion to Base Rate Loans described in the preceding subsection. In the case of a Borrowing, each Bank shall make the amount of its Committed Loan available to the Administrative Agent in immediately available funds at the Administrative Agent’s Office not later than 12:00 noon, Chicago time, on the Business Day specified in the applicable Extension of Credit Request. Upon satisfaction of the applicable conditions set forth in Article XI (and, if such Borrowing is the initial Credit Extension, Article X ), the Administrative Agent shall make all funds so received available to the Borrower in like funds as received by the Administrative Agent either by (i) crediting the account of the Borrower on the books of Bank of America with the amount of such funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) the Administrative Agent by the Borrower.
(c) Except as otherwise provided herein, a Eurodollar Rate Loan may be continued or converted only on the last day of a Loan Period for such Eurodollar Rate Loan. During the existence of a Default, no Loans may be requested as, converted to or continued as Eurodollar Rate Loans without the consent of the Majority Banks.
(d) The Administrative Agent shall promptly notify the Borrower and the Banks of the interest rate applicable to any Loan Period for Eurodollar Rate Loans upon determination of such interest rate. At any time that Base Rate Loans are outstanding, the Administrative Agent shall notify the Borrower and the Banks of any change in Bank of America’s prime rate used in determining the Base Rate promptly following the public announcement of such change.
(e) After giving effect to all Borrowings, all conversions of Committed Loans from one Type of Loan to the other, and all continuations of Committed Loans as the same Type of Loan, there shall not be more than ten Loan Periods in effect with respect to Committed Loans.
2.4 Availability of Funds . Unless the Borrower or a Bank, as the case may be, notifies the Administrative Agent by 11:00 a.m., Chicago time, on a date on which it is scheduled to make payment to the Administrative Agent of (a) in the case of a Bank, the proceeds of a Loan or (b) in the case of the Borrower, a payment of principal, interest or fees to the Administrative Agent for the account of the Banks, that it does not intend to make such payment, the Administrative Agent may assume that such payment has been made. The Administrative Agent may, but shall not be obligated to, make the amount of such payment available to the intended recipient in reliance upon such assumption. If such Bank or the Borrower, as the case may be, has not in fact made such payment to the Administrative Agent, the recipient of such payment shall, on demand by the Administrative Agent, repay to the
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Administrative Agent the amount so made available, together with interest thereon, in respect of such day during the period commencing on the date such amount was so made available by the Administrative Agent until the date the Administrative Agent recovers such amount at a rate per annum equal to (i) in the case of repayment by a Bank, the Federal Funds Rate for such day or (ii) in the case of repayment by the Borrower, the applicable interest rate otherwise payable by the Borrower in respect of such Loan.
2.5 Satisfaction of Conditions . Unless the Administrative Agent shall have been notified by a Bank on or prior to the Borrowing Date of any Loan to be made by such Bank (and before the Administrative Agent has disbursed such Loan in accordance with Section 2.3 hereof) that such Bank has determined that the Borrower has failed to meet the conditions specified in Article X (in the case of the initial Extension of Credit) or Article XI with respect to the relevant Borrowing, the Administrative Agent may rely (unless the Administrative Agent has actual knowledge to the contrary) upon the certification of the Borrower, with respect to the fulfillment of such conditions precedent, contained in the applicable Extension of Credit Request.
2.6 Currency . All Loans shall be denominated in Dollars.
2.7 Increase in Commitments .
(a) Request for Increase . Provided there exists no Default and there has not previously been any reduction of the Total Commitment by the Borrower in accordance with Section 4.1 hereof, upon notice to the Administrative Agent (which shall promptly notify the Banks), the Borrower may from time to time, request an increase in the Total Commitment by an amount (for all such requests) not exceeding $50,000,000; provided that any such request for an increase shall be in a minimum amount of $10,000,000. At the time of sending such notice, the Borrower (in consultation with the Administrative Agent) shall specify the time period within which each Bank is requested to respond (which shall in no event be less than ten Business Days from the date of delivery of such notice to the Banks).
(b) Bank Elections to Increase . Each Bank shall notify the Administrative Agent within such time period whether or not it agrees to increase its Commitment from the Increase Effective Date until the Commitment Termination Date and, if so, whether by an amount equal to, greater than, or less than its Percentage of such requested increase. Any Bank not responding within such time period shall be deemed to have declined to increase its Commitment.
(c) Notification by Administrative Agent; Additional Banks . The Administrative Agent shall notify the Borrower and each Bank of the Banks’ responses to each request made hereunder. Thereafter, in order to achieve the full amount of a requested increase following each Bank’s determination of whether to increase its Commitment, and subject to the approval of the Administrative Agent (which approval shall not be unreasonably withheld), the Borrower may also invite additional Eligible Assignees to become Banks pursuant to a joinder agreement in form and substance satisfactory to the Administrative Agent and its counsel.
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(d) Effective Date and Allocations . If the Aggregate Commitments are increased in accordance with this Section, the Administrative Agent and the Borrower shall determine the effective date (the “ Increase Effective Date ”) and the final allocation of such increase. The Administrative Agent shall promptly notify the Borrower and the Banks of the final allocation of such increase and the Increase Effective Date.
(e) Conditions to Effectiveness of Increase . As a condition precedent to such increase, the Borrower shall deliver to the Administrative Agent a certificate of each Loan Party dated as of the Increase Effective Date (in sufficient copies for each Bank) signed by a Responsible Officer of such Loan Party (i) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such increase, and (ii) in the case of the Borrower, certifying that, before and after giving effect to such increase, (A) the representations and warranties contained in Article VII and the other Loan Documents are true and correct on and as of the Increase Effective Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date, and except that for purposes of this Section 2.7 , the representations and warranties contained in Section 7.4 shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), of Section 8.1 , and (B) no Default exists. The Borrower shall prepay any Committed Loans outstanding on the Increase Effective Date (and pay any additional amounts required pursuant to Section 6.4 together with all accrued interest, fees and other amounts owing hereunder with respect to such prepaid amount) to the extent necessary to keep the outstanding Committed Loans ratable with any revised Percentages arising from any nonratable increase in the Commitments under this Section.
(f) Conflicting Provisions . This Section shall supersede any provisions in Sections 5.4 or 14.1 to the contrary.
ARTICLE III
3.1 Repayment of Loans . The Borrower hereby promises to pay the unpaid principal amount of its Loan(s) on the last day of the Loan Period for each such Loan, which repayment may be made from the proceeds of a new Borrowing if then permitted hereunder, and on the Commitment Termination Date.
3.2 Notes .
(a) The Committed Loans of each Bank shall be evidenced by a Note in the principal amount of the original Commitment of such Bank.
(b) Each Bank shall record in its records, or at its option on the schedule attached to its applicable Note, the date and amount of each Loan made by such Bank hereunder, each repayment or prepayment thereof, and the dates on which the Loan Period for such Loan shall begin and end. Prior to any transfer or assignment of any of its Notes, each Bank shall record on the schedule attached thereto the then outstanding principal amount thereof and the date through which interest has been paid. The
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aggregate unpaid principal amount so recorded shall be rebuttable presumptive evidence of the principal amount owing and unpaid on such Note. The failure to so record or any error in so recording any such amount on such schedule shall not, however, limit or otherwise affect the obligations of the Borrower hereunder or under any Note to repay the outstanding principal amount of its Loans, together with all interest accruing thereon, nor shall such failure or error affect the Borrower’s obligations under any other Loan Document.
3.3 Interest Rates . The Borrower hereby promises to pay interest calculated in Dollars on the unpaid principal amount of each Loan of each Bank for the period from the Borrowing Date for such Loan to the date such Loan is paid in full, as follows:
(a) if such Loan is a Base Rate Loan, interest at a rate per annum equal to the Base Rate from time to time in effect plus the applicable Base Rate Margin per annum for each day during such period; and
(b) if such Loan is a Eurodollar Rate Loan, interest at a rate per annum equal to the Eurodollar Rate (Adjusted) applicable to the Loan Period therefor plus the applicable Eurodollar Margin per annum for each day during such period;
provided that in the event that the principal of any Loan is not paid when due (whether by acceleration or otherwise), such unpaid principal amount of such Loan shall bear interest, at the option of the Majority Banks, after the due date of such principal amount until such amount is paid in full, at a rate per annum (the “ Default Rate ”) equal to two percent (2%) plus the interest rate then applicable to such Loan from time to time in effect but in no event less than the rate per annum as in effect at such due date.
3.4 Interest Payment Dates . Accrued interest on each Base Rate Loan shall be paid on each Quarterly Payment Date and at maturity (whether by acceleration or otherwise), and accrued interest on each Loan other than Base Rate Loans shall be payable on the last day of the Loan Period for such Loan and at maturity (whether by acceleration or otherwise); provided that if such Loan Period exceeds three (3) months, such accrued interest shall be payable on the date in each third succeeding calendar month numerically corresponding to the commencement date of such Loan Period, or, if there exists no date numerically corresponding to the commencement date of such Loan Period in any such third succeeding month, such accrued interest shall be payable on the last Business Day of such third succeeding month, and after maturity, whether by acceleration or otherwise, accrued interest on all matured Loans shall be payable on demand.
3.5 Setting and Notice of Rates .
(a) The applicable interest rate for or during each Loan Period for any Committed Loan shall be determined by the Administrative Agent, which shall promptly advise the Borrower and each Bank thereof. The interest rate determination by the Administrative Agent shall be conclusive and binding upon the parties hereto, in the absence of demonstrable error.
(b) The Administrative Agent shall, upon written request of the Borrower or any Bank, deliver to the Borrower or such Bank, as the case may be, a statement showing
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the computations used by the Administrative Agent in determining the interest rate applicable to any Eurodollar Rate Loan.
3.6 Computation of Interest . Interest on each Loan other than Base Rate Loans shall be computed for the actual number of days elapsed on the basis of a 360-day year. Interest on each Base Rate Loan shall be computed for the actual number of days elapsed on the basis of a 365- or 366-day year, as appropriate, when the Base Rate is determined by the prime rate, and on the basis of a 360-day year when the Base Rate is determined by the Federal Funds Rate. In computing interest on each Loan, the Borrowing Date for such Loan shall be included and the date of payment shall be excluded; provided , however , that if a Loan is repaid on the Borrowing Date for such Loan, such day shall nevertheless be included in computing interest on such Loan.
3.7 Limitation on Interest . It is the intention of the parties hereto to conform strictly to applicable usury laws and, anything herein to the contrary notwithstanding, the obligations of the Borrower to each Bank under this Agreement and the other Loan Documents shall be subject to the limitation that payments of interest shall not be required to the extent that receipt thereof would be contrary to provisions of law applicable to such Bank limiting rates of interest which may be charged or collected by such Bank. Accordingly, if the transactions contemplated hereby would be usurious under any Applicable Law (including the Federal and state laws of the United States of America, or of any other jurisdiction whose laws may be mandatorily applicable) with respect to any Bank, then, in that event, notwithstanding anything to the contrary in this Agreement, it is agreed as follows:
(a) the following provisions of this Section shall govern and control;
(b) with respect to the Borrower, the aggregate of all consideration that constitutes interest under Applicable Law that is contracted for, charged or received under this Agreement, or under any of the other Loan Documents or otherwise in connection herewith or therewith, by such Bank shall under no circumstances exceed the maximum amount of interest allowed by such Applicable Law (such maximum lawful interest rate, if any, with respect to such Bank herein called the “ Highest Lawful Rate ”), and any excess shall be credited to the Borrower by such Bank (or, if such consideration shall have been finally paid in full, such excess refunded to the Borrower);
(c) all sums paid, or agreed to be paid, to such Bank for the use, forbearance and detention of the indebtedness of the Borrower to such Bank hereunder shall, to the extent permitted by such Applicable Law, be amortized, prorated, allocated and spread throughout the full term of such indebtedness until payment in full of such indebtedness so that the actual rate of interest is uniform throughout the full term thereof;
(d) if, with respect to such Bank, at any time the interest provided pursuant to Section 3.3 , together with any other fees payable to such Bank pursuant to this Agreement or any other Loan Document and deemed interest under such Applicable Law, exceeds that amount which would have accrued to such Bank at the Highest Lawful Rate, the amount of interest and any such fees to accrue pursuant to this Agreement or any other Loan Document shall be limited, for such Bank, notwithstanding anything to the contrary in this Agreement or any other Loan Document, to that amount which would
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have accrued at the Highest Lawful Rate, but any subsequent reductions in the amount of such interest and/or fees, as applicable, which would otherwise occur shall not reduce the interest to accrue to such Bank pursuant to this Agreement and the other Loan Documents below the Highest Lawful Rate until the total amount of interest accrued pursuant to this Agreement and the other Loan Documents and such fees deemed to be interest equals the amount of interest which would have accrued to such Bank if a varying rate per annum equal to the interest provided pursuant to Section 3.3 had at all times been in effect plus the amount of fees which would have been received but for the effect of this Section; and
(e) if the total amount of interest paid or accrued for payment by the Borrower together with any other fees payable by the Borrower pursuant to this Agreement and the other Loan Documents and deemed interest under Applicable Law, with respect to such Bank pursuant to this Agreement and the other Loan Documents under the foregoing provisions of this Section, is less than the total amount of interest which would have accrued with respect to the Borrower if a varying rate per annum equal to the interest provided pursuant to Section 3.3 had at all times been in effect and all fees provided for in this Agreement and the other Loan Documents had been paid, then the Borrower agrees to pay to such Bank, upon demand, an amount equal to the difference between (i) the lesser of (A) the amount of interest and fees which would have accrued with respect to the Borrower if the Highest Lawful Rate had at all times been in effect, and (B) the amount of interest and fees which would have accrued with respect to the Borrower if a varying rate per annum equal to the interest provided pursuant to Section 3.3 had at all times been in effect and all fees provided for in this Agreement and the other Loan Documents had been paid and (ii) the amount of interest and fees paid by the Borrower in accordance with the other provisions of this Agreement and the other Loan Documents.
ARTICLE IV
4.1 Reduction or Termination of the Commitments . The Borrower shall have the right, at any time and from time to time, to reduce permanently in part, or to terminate in whole, without penalty or premium, the Total Commitment, upon not less than five (5) Business Days prior notice (by facsimile or by telephone (confirmed in writing promptly thereafter)) received by the Administrative Agent (which shall promptly advise each Bank thereof), which notice shall designate the date (which shall be a Business Day) of such reduction or termination and the amount of any partial reduction of the Total Commitment; provided that the Borrower may not reduce the Total Commitment to an amount which is less than the Aggregate Outstanding Loans on the effective date specified in the Borrower’s aforesaid notice. Any such partial reduction of the Total Commitment shall be in a minimum amount of $5,000,000 and integral multiples of $1,000,000 in excess thereof. Such partial reduction or termination of the Total Commitment shall be effective on the date specified in the Borrower’s aforesaid notice. The Borrower may only terminate the Total Commitment upon payment in full of all Aggregate Outstanding Loans and all other Bank Obligations.
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Any partial reduction of the Total Commitment shall reduce each Bank’s Commitment by an amount equal to such Bank’s pro rata share of the aggregate reduction in the Total Commitment.
4.2 Voluntary Prepayments . The Borrower may, from time to time as hereinafter provided, prepay Base Rate Loans, in whole or in part, without premium or penalty, and prepay Eurodollar Rate Loans, in whole or in part, subject to the payments, if any, required by Section 6.4 ; provided that any such partial prepayment shall be in an aggregate amount of a minimum of $5,000,000 and integral multiples of $1,000,000 in excess thereof. Accrued interest to the date of prepayment on the aggregate principal amount of Loans being prepaid shall accompany such prepayment. The Borrower shall give notice (by facsimile or by telephone (confirmed in writing promptly thereafter)) to the Administrative Agent (which shall promptly notify the Banks) of each proposed prepayment hereunder, prior to 10:30 a.m., Chicago time, on the date of such proposed prepayment (or, in the case of a proposed prepayment of Eurodollar Rate Loans, two (2) Business Days before the proposed prepayment date) which notice shall specify the proposed prepayment date (which shall be a Business Day) and the aggregate principal amount of the proposed prepayment.
5.1 Fees; Computation of Fees .
(a) In consideration of the Administrative Agent’s services to be provided in connection herewith, the Borrower hereby agrees to pay to the Administrative Agent the fees set forth in the Fee Letter.
(b) In consideration of the commitment of each Bank to make Committed Loans to the Borrower hereunder, the Borrower hereby agrees to pay to the Administrative Agent, for the account of each Bank (to be paid to each Bank by the Administrative Agent in proportion to such Bank’s Commitment) the applicable Facility Fee per annum (computed for the actual number of days elapsed on the basis of a 360-day year) commencing on the Effective Date and payable in arrears on each Quarterly Payment Date and on the Commitment Termination Date, on the daily average amount of the Total Commitment, determined for the period then ended for which such fee has not theretofore been paid.
(c) The Borrower shall pay to the Administrative Agent for the account of each Bank in accordance with its Percentage, a fee equal in amount to the then applicable Utilization Fee as set forth in the Pricing Matrix (the “ Utilization Fee ”) times the Aggregate Outstanding Loans on each day that the Aggregate Outstanding Loans exceed 50% of the actual daily
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amount of the Total Commitment. The Utilization Fee shall be due and payable quarterly on the Quarterly Payment Dates, commencing with the first such date to occur after the Effective Date, and on the Commitment Termination Date. The Utilization Fee shall be calculated quarterly in arrears. The Utilization Fee shall accrue at all times the Aggregate Outstanding Loans exceed 50% of the actual daily amount of the Total Commitment, including at any time during which one or more of the conditions in Article X or Article XI is not met.
5.2 Payments . All payments to be made by the Borrower shall be made without condition or deduction for any counterclaim, defense, recoupment or setoff. All payments (including those made pursuant to Section 4.2 ) of principal of, or interest on, the Loans shall be made by the Borrower to the Administrative Agent in immediately available funds for the account of the holders of the relevant Notes. All payments of the Facility Fee shall be made by the Borrower to the Administrative Agent in immediately available funds for the account of the Banks pro rata according to their respective Commitments. All payments of the fees described in the Fee Letter shall be made by the Borrower to the Administrative Agent in immediately available funds for the account of the Administrative Agent. All other payments shall be made to the Administrative Agent at its address specified on Schedule 1(b) (or at such other address as the Administrative Agent may have specified for such purpose in a written notice to the Borrower) not later than 1:00 p.m., Chicago time, on the date due; and funds received after that hour shall be deemed to have been received by the Administrative Agent on the next succeeding Business Day. The Administrative Agent shall promptly remit to each Bank in immediately available finds such Bank’s share of all such payments received by the Administrative Agent for the account of such Bank. All payments under Section 6.1 , Section 6.4 or Section 14.5 shall, unless otherwise specified herein, be made by the Borrower directly to the Bank or Banks entitled thereto.
5.3 Net Payments; Tax Exemptions .
(a) All payments by the Borrower of principal, interest, fees, indemnities and other amounts payable to any recipient (each, a “ Recipient ”) hereunder shall be made without setoff or counterclaim and free and clear of, and without withholding or deduction for or on account of, any present or future Taxes (other than Excluded Taxes) now or hereafter imposed on such Recipient or its income, property, assets or franchises (such Recipient’s “ Recipient Taxes ”), except to the extent that such withholding or deduction (i) is required by Applicable Law, (ii) results from the breach by such Recipient of its Exemption Agreement, if any, (iii) would not be required if such Recipient’s Exemption Representation were true or (iv) would not be required if such Recipient’s appropriate Internal Revenue Service form specified in Section 5.3(b) claiming complete exemption were true and accurate at the time of the delivery thereof. If any such withholding or deduction is required by Applicable Law, the Borrower will:
(A) pay to the relevant authorities the full amount so required to be withheld or deducted when and as the same shall become due and payable to such authorities;
(B) promptly forward to the Administrative Agent and each affected Bank an official receipt or other documentation satisfactory to the Administrative Agent evidencing such payment to such authorities; and
(C) except to the extent that such withholding or deduction (1) is for Excluded Taxes, (2) results from the breach, by a Recipient of its Exemption Agreement,
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if any, or (3) would not be required if such Recipient’s Exemption Representation were true or (4) would not be required if such Recipient’s appropriate Internal Revenue Service form specified in Section 5.3(b) claiming complete exemption were true and accurate at the time of the delivery thereof, pay to the Administrative Agent for the account of the relevant Recipient such additional amount as is necessary to ensure that the net amount actually received by each Recipient will equal the full amount such Recipient would have received had no such withholding or deduction been required.
(b) In consideration of the Borrower’s agreements in Section 5.3(a) , each Bank which is not a US Person hereby agrees (such Bank’s “ Exemption Agreement ”), to the extent permitted by Applicable Law (including any applicable double taxation treaty of the jurisdiction of its incorporation or the jurisdiction in which its lending office is located), to execute and deliver to the Borrower, on or about the first scheduled payment date in each Fiscal Year, a United States Internal Revenue Service Form W-8ECI or W-8BEN (or successor form), as appropriate, properly completed and claiming a complete or partial exemption, as the case may be, from withholding or deduction for or on account of “United States Federal Recipient Taxes” (as defined in the Code) of such Bank.
(c) Each Bank hereby represents and warrants (such Bank’s “ Exemption Representation ”) to the Borrower that on the date hereof (or in the case of a Purchasing Bank or an assignee pursuant to Section 14.10 , on the date on which it becomes a Bank party hereto) its lending office is entitled to receive payments of principal of, and interest on, Loans made by such Bank from such lending office without withholding or deduction for or on account of such Bank’s Recipient Taxes imposed by the United States of America or any political subdivision thereof.
(d) Upon the request from time to time of the Borrower or the Administrative Agent, each Bank that is organized under the laws of a jurisdiction other than the United States of America shall execute and deliver to the Borrower and the Administrative Agent one or more (as the Borrower or the Administrative Agent may reasonably request) United States Internal Revenue Service Forms W-8BEN or W-8ECI or such other forms or documents, appropriately completed, as may be applicable to establish the extent, if any, to which a payment to such Bank is exempt from withholding or deduction of Recipient Taxes.
(e) If any Bank claims exemption from, or reduction of, withholding tax under a United States tax treaty by providing IRS Form W-8ECI and such Bank sells, assigns, grants a participation in, or otherwise transfers all or part of the obligations of the Borrower to such Bank, such Bank agrees to notify the Administrative Agent of the percentage amount in which it is no longer the beneficial owner of such obligations of the Borrower hereunder. To the extent of such percentage amount, the Administrative Agent will treat such Bank’s IRS Form W-8ECI as no longer valid.
(f) If any Bank claiming exemption from United States withholding tax by filing IRS Form W-8BEN with the Administrative Agent sells, assigns, grants a participation in, or otherwise transfers all or part of the obligations of the Borrower to
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such Bank hereunder, such Bank agrees to undertake sole responsibility for complying with the withholding tax requirements imposed by Sections 1441 and 1442 of the Code.
(g) If any Bank is entitled to a reduction in the applicable withholding tax, the Administrative Agent may withhold from any interest payment to such Bank an amount equivalent to the applicable withholding tax after taking into account such reduction. If the forms or other documentation required by subsection (d) of this Section are not delivered to the Administrative Agent, then the Administrative Agent may withhold from any interest payment to such Bank not providing such forms or other documentation an amount equivalent to the applicable withholding tax.
(h) If the IRS or any other governmental authority of the United States or any other jurisdiction asserts a claim that the Administrative Agent did not properly withhold tax from amounts paid to or for the account of any Bank (because the appropriate form was not delivered or was not properly executed, or because such Bank failed to notify the Administrative Agent of a change in circumstances which rendered the exemption from, or reduction of, withholding tax ineffective, or for any other reason) such Bank shall indemnify the Administrative Agent fully for all amounts paid, directly or indirectly, by the Administrative Agent as tax or otherwise, including penalties and interest, and including any taxes imposed by any jurisdiction on the amounts payable to the Administrative Agent under this Section, together with all costs and expenses (including reasonable fees of attorneys for the Administrative Agent (including the allocable costs of internal legal services and all disbursements of internal counsel)). The obligation of the Banks under this subsection shall survive the repayment of the Loans, cancellation of the Notes, any termination of this Agreement and the resignation or replacement of the Administrative Agent.
5.4 Application of Certain Payments .
(a) Prior to the occurrence and continuation of a Pro Rata Distribution Event, each payment of principal shall be applied to such of the Loans as the Borrower shall direct by notice to be received by the Administrative Agent on or before the date of such payment; provided that any Loans of the Borrower maturing the same day shall be paid pro rata among such Loans. The Administrative Agent shall remit each such payment by the Borrower in accordance therewith ratably among the applicable Banks holding such Loans. Concurrently with each remittance to any Bank of its share of any such payment, the Administrative Agent shall advise each Bank as to the application of such payment.
(b) Following the occurrence and during the continuation of a Pro Rata Distribution Event, the Administrative Agent and the Banks shall apply all collections and recoveries of the Loans and the other Bank Obligations hereunder first , to payment of that portion of the Bank Obligations constituting fees, indemnities, expenses and other amounts (including fees, charges and disbursements of counsel to the Administrative Agent and amounts payable under Article VI ) payable to the Administrative Agent in its capacity as such, second , to the payment of principal and interest on the outstanding Loans on a pro rata basis to each Bank based on the respective amounts of such Bank’s principal and accrued interest (whether or not mature and currently payable) and, third , to
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payment of the remaining outstanding Bank Obligations on a pro rata basis to each Bank based on the respective remaining amounts of such Bank Obligations owed to each Bank (whether or not mature and currently payable).
(c) For purposes hereof, a “ Pro Rata Distribution Event ” shall mean the first to occur of (i) an Event of Default under Section 12.1(a) , Section 12.1(f) or Section 12.1(g) or (ii) any other Event of Default if the Majority Banks shall have notified the Administrative Agent of the occurrence of such Event of Default and shall have instructed the Administrative Agent that payments shall be applied as provided in Section 5.4(b) above. The Administrative Agent shall promptly notify the Borrower and each Bank following the occurrence of a Pro Rata Distribution Event.
(d) The Banks and the Administrative Agent agree that if any distribution shall be made by the Administrative Agent contrary to this Section (whether because the Administrative Agent shall not, at the time of distribution, have been aware of the occurrence of any Event of Default or otherwise), the Banks shall cooperate with the Administrative Agent to redistribute payments, collections or recoveries in accordance with this Section.
5.5 Offset . Upon the occurrence of any Default described in Section 12.1(f) or Section 12.1(g) , or of any acceleration of the Notes pursuant to Section 12.2 , each Bank is hereby authorized, at any time and from time to time, without notice to the Borrower (any such notice being expressly waived by the Borrower to the fullest extent permitted by Applicable Law), to the fullest extent permitted by Applicable Law, to set off, to exercise any banker’s lien or any other right of attachment or garnishment and apply any and all balances, credits, deposits (general or special, time or demand, provisional or final), accounts or monies at any time held and other indebtedness at any time owing by such Bank to or for the account of the Borrower against any and all Bank Obligations held by such Bank (subject to the provisions of Section 13.4) , whether or not such Bank has made any demand under or with respect to any of such Bank Obligations and although such Bank Obligations may be unmatured. Promptly following such action, such Bank shall give notice thereof to the Administrative Agent and the Administrative Agent shall promptly give notice thereof to the Borrower and each other Bank, but failure to do so shall not impair the effect of such action. Subject to the foregoing provisions of this Section, the rights of the Banks under this Section are in addition to, in augmentation of, and do not derogate from or impair, any other rights and remedies (including other rights of setoff) which the Banks may have.
ARTICLE VI
6.1 Cost Protection .
(a) If (i) Regulation D of the FRB (“ Regulation D ”), (ii) the adoption after the date hereof of any Applicable Law, (iii) any change after the date hereof in any Applicable Law, (iv) any change after the date hereof in the interpretation or administration thereof by any governmental authority, central bank or comparable agency
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charged with the interpretation or administration thereof, or (v) compliance by such Bank (or any Eurodollar Office of such Bank) with any request or directive (whether or not having the force of law) of any such authority, central bank or comparable agency;
(A) shall subject any Bank (or any Eurodollar Office of such Bank) to any tax, duty or other charge with respect to its Loans, its Notes or its obligation to make Loans, or shall change the basis of taxation of payments to any Bank of the principal of or interest on its Loans or any other amounts due under this Agreement in respect of its Loans or its obligation to make Loans (except for Excluded Taxes or Recipient Taxes of the type described in clause (ii) , clause (iii) and clause (iv) of the first sentence of Section 5.3(a) ;
(B) shall impose, modify or deem applicable any assessment or other charge against assets of, deposits with or for the account of, or credit extended by, any Bank (or any Eurodollar Office of such Bank);
(C) shall impose, modify or deem applicable any reserve (including any reserve imposed by the FRB), special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Bank (or any Eurodollar Office of such Bank); or
(D) shall impose on any Bank (or its Eurodollar Office) any other condition affecting its Loans, its Notes or its obligation to make Loans;
and the result of any of the foregoing is to increase the cost to such Bank (or any Eurodollar Office of such Bank) of making or maintaining or issuing its Commitment or any Loan or to reduce the amount of any sum received or receivable by such Bank (or its Eurodollar Office) under this Agreement or under its Notes then, within ten (10) days after demand by such Bank (which demand shall be accompanied by a statement setting forth the basis of such demand), the Borrower shall pay directly to such Bank such additional amount or amounts as will compensate such Bank for such cost, increased cost or such reduction.
(b) If any Bank shall reasonably determine that the application or adoption after the date hereof of any law, rule, regulation, directive, interpretation, treaty or guideline regarding capital adequacy, or any change therein or in the interpretation or administration thereof after the date hereof, whether or not having the force of law increases the amount of capital required to be maintained by such Bank, or any corporation controlling such Bank, and such increase is based solely upon the existence of such Bank’s obligations hereunder, by an amount deemed by such Bank in its sole discretion to be material, then from time to time, within ten (10) days after demand from such Bank, the Borrower shall pay to such Bank such amount or amounts as will fairly compensate such Bank for such increased capital requirement. The determination of any amount to be paid by the Borrower under this Section shall take into consideration the policies of such Bank, or any corporation controlling such Bank, with respect to capital adequacy and shall be based upon any reasonable averaging, attribution and allocation methods. A certificate of such Bank setting forth the amount or amounts as shall be
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necessary to compensate such Bank as specified in this Section shall be delivered to the Borrower and the Administrative Agent and shall be conclusive in the absence of manifest error.
(c) Promptly after any Bank becomes aware of any event that would entitle it to compensation under Section 6.1 (a) or Section 6.1(b) , such Bank shall notify the Administrative Agent, which shall advise the Borrower thereof; provided that if any Bank fails to notify the Administrative Agent within 180 days of its actual knowledge of any such event (the “ Notice Date ”), the Borrower shall not be obligated to pay such additional amounts accruing during the period from the Notice Date until the date of delivery of such notice; provided , further , that the failure to give such notice shall not affect the Borrower’s obligation to pay such additional amounts accrued prior to the Notice Date or after delivery of such notice.
6.2 Basis for Determining Interest Rate Inadequate or Unfair . If with respect to any request for a Eurodollar Rate Loan or a conversion to or continuation thereof:
(a) the Administrative Agent determines (which determination shall be binding and conclusive on all parties hereto) that, by reason of circumstances affecting the relevant market, adequate and reasonable means do not exist for ascertaining the interest rate applicable hereunder to Eurodollar Rate Loans; or
(b) the Majority Banks advise the Administrative Agent that the interest rate applicable hereunder to any outstanding Eurodollar Rate Loan will not adequately and fairly reflect the cost to such Banks of maintaining or funding such Eurodollar Rate Loan for such Loan Period, or that the making or funding of Eurodollar Rate Loans has become impracticable as a result of an event occurring after the date hereof which in the opinion of such Banks materially affects such Loans,
then (i) the Administrative Agent shall promptly notify the Borrower and each Bank thereof, and (ii) so long as such circumstances shall continue, no Bank shall be under any obligation to make, convert or continue the Eurodollar Rate Loans.
6.3 Changes in Law Rendering Certain Eurodollar Rate Loans Unlawful . In the event that any change in (including the adoption of any new) Applicable Law, or any change in the interpretation of any Applicable Law by any judicial, governmental or other regulatory body charged with the interpretation, implementation or administration thereof, should make it (or in the good-faith judgment of an Affected Bank should raise a substantial question as to whether it is) unlawful for such Affected Bank to make, maintain or fund Eurodollar Rate Loans, then (a) such Affected Bank shall promptly notify each of the other parties hereto, (b) the obligation of such Affected Bank to make Eurodollar Rate Loans shall, upon the effectiveness of such event, be suspended for the duration of such unlawfulness, and (c) if the Affected Bank so requests, the Borrower shall, on such date as may be required by the relevant Applicable Law, repay or prepay all then outstanding Eurodollar Rate Loans made to the Borrower by such Affected Bank together with accrued interest thereon and all amounts then due, if any, under Section 6.4 .
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6.4 Funding Losses . The Borrower hereby agrees that, upon demand by any Bank (which demand shall be accompanied by a statement setting forth the basis for the calculations of the amount being claimed), the Borrower will indemnify such Bank against any net loss or expense which such Bank may sustain or incur (including any net loss or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Bank to fund or maintain Eurodollar Rate Loans made to the Borrower by such Bank), as reasonably determined by such Bank, as a result of (a) any payment or prepayment of principal (including pursuant to Section 4.2 , Section 4.3 , Section 6.3 or Section 12.2 ) of any such Eurodollar Rate Loan on a date other than the last day of a Loan Period for such Loan, or (b) any failure of the Borrower to borrow, continue or convert any Loans on the date and in the amount specified therefor in a notice of Borrowing, conversion or continuation given by the Borrower pursuant to this Agreement. For this purpose, all notices to the Administrative Agent pursuant to this Agreement shall be deemed to be irrevocable.
6.5 Discretion of Banks as to Manner of Funding . Notwithstanding any provision of this Agreement to the contrary, each Bank shall be entitled to fund and maintain its funding of all or any part of its Loans in any manner it sees fit, it being understood, however, that for the purposes of this Agreement all determinations hereunder shall be made as if such Bank had actually funded and maintained each Eurodollar Rate Loan during the Loan Period for such Loan through the sale of deposits or the purchase of deposits, as the case may be, having a maturity corresponding to the last day of such Loan Period and bearing an interest rate equal to the Eurodollar Rate for such Loan Period. Each Bank shall use reasonable efforts (consistent with its internal policies and legal and regulatory restrictions) to take appropriate action, including the selection of a jurisdiction of its Eurodollar Office or the changing of the jurisdiction of its Eurodollar Office, as the case may be, so as to avoid any illegality of the type referred to in Section 6.3 or the imposition of any increased costs or Taxes or to limit the amount of any such increased costs or Taxes which may thereafter accrue; provided that no such selection or change of the jurisdiction for its Eurodollar Office shall be made if, in the reasonable judgment of such Bank, such selection or change would be disadvantageous to such Bank.
6.6 Replacement of Certain Banks . In the event that any Bank(s) shall claim payment of any amounts pursuant to this Article VI or any Taxes or other amounts pursuant to Section 5.3 , or shall be an Affected Bank for more than 30 days, such Bank(s) may accept a purchase offer as described hereinafter. If the Borrower shall find one or more banks that, if not a Bank, are each an Eligible Assignee and that unconditionally offer in writing (with a copy to the Administrative Agent) collectively to assume all of such Bank’s obligations hereunder and to purchase all of such Bank’s rights hereunder and principal and interest in the Loans owing to such Bank(s) and the Notes held by such Bank(s) without recourse, representation or warranty (other than as provided in the related Assignment and Assumption) for an amount to be received by such Bank(s) equal to the principal amount of such Loans plus interest accrued thereon to the date of such purchase plus any other amounts then payable hereunder on a date therein specified, then upon acceptance of such purchase offer, the Borrower shall be obligated to pay such costs and Taxes (other than Excluded Taxes) to such Bank(s) pursuant to this Article VI or Section 5.3 to the date of such purchase (at which time such Bank shall cease to be a Bank hereunder); provided that (a) if a Bank accepts the proposed purchase offer and the proposed purchasing bank(s) fails to purchase such rights and interest and to assume such obligations on such specified date in accordance with the terms of such offer, the Borrower shall continue to be
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obligated to pay the amounts or Taxes (other than Excluded Taxes) to such Bank pursuant to this Article VI and Section 5.3 , and (b) if such Bank fails to accept such purchase offer, the Borrower shall not be obligated to pay to such Bank such amounts that such Bank would otherwise be currently entitled to pursuant to this Article VI (except under Section 6.3 ) or any Taxes (other than Excluded Taxes) or other amounts pursuant to Section 5.3 from and after the date of such purchase offer and to the extent that such Bank is an Affected Bank, such Bank shall no longer be an Affected Bank for such period; provided , however , that nothing contained herein shall be deemed to restrict a Bank’s ability to recover additional amounts owed to such Bank pursuant to this Article VI or any Taxes or other amounts pursuant to Section 5.3 that such Bank would otherwise be entitled to in the future and not directly arising out of the same circumstances which caused the provisions of this Section to originally become operative.
6.7 Conclusiveness of Statements; Survival of Provisions . Determinations and statements of any Bank pursuant to this Article VI shall be made in good faith and shall be conclusive and binding on the parties hereto, absent demonstrable error. The provisions of Section 5.3 , Section 6.1 , Section 6.4 , Section 14.6 and the last sentence of each of Section 13.1(e) and Section 14.5 and shall survive termination of this Agreement.
ARTICLE VII
The Borrower represents and warrants to the Administrative Agent and the Banks as follows:
7.1 Corporate Existence, Power, Authority, etc . The Borrower is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Arkansas; each Subsidiary is a corporation duly incorporated, validly existing and in good standing under the laws of the state of its incorporation; the Borrower and each Subsidiary is duly qualified and in good standing as a foreign Person authorized to do business in each other jurisdiction where, because of the nature of its activities or properties, such qualification is required, other than where the failure to be so qualified or in good standing would not reasonably be expected to have a Materially Adverse Effect; each Loan Party has all requisite corporate power and authority (a) to own its assets and to carry on the business in which it is engaged, and (b) to execute, deliver and perform its obligations under each Loan Document to which it is a party; each Subsidiary has all requisite corporate, partnership or other power and authority to own its assets and to carry on the business in which it is engaged; and the Borrower has all requisite corporate power and authority to own its assets and to carry on the business in which it is engaged and to issue the Notes in the manner and for the purpose contemplated by this Agreement.
7.2 No Violation, Breach, Default, Lien, etc . The execution, delivery and performance by each Loan Party of each Loan Document to which it is a party, and the issuance of the Notes in the manner and for the purpose contemplated by this Agreement, have been duly authorized by all necessary corporate action (including any necessary stockholder action) on the part of each Loan Party, and do not (a) violate any provision of any Applicable Law, or of the charter or by-laws of such Loan Party, or (b) result in a breach of or constitute a default under any indenture or loan or credit agreement or under any other agreement or instrument to which
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the Borrower or any Subsidiary of the Borrower is a party or by which the Borrower or any Subsidiary of the Borrower or its respective properties is bound, or (c) result in, or require the creation or imposition of, any Lien of any nature upon or with respect to any of the properties now owned or hereafter acquired by the Borrower or any Subsidiary, other than, with respect to (b) and (c) above, such breaches, defaults or Liens which would not reasonably be expected to have a Materially Adverse Effect. Neither any Loan Party nor any other Subsidiary is in default under or in violation of its organizational documents or, except for such defaults or violations which would not reasonably be expected to have a Materially Adverse Effect, any Applicable Law, indenture, agreement or instrument.
7.3 Legal Valid and Binding Obligations . This Agreement constitutes, and (when executed and delivered by the Loan Parties thereto) each other Loan Document to which any Loan Party is a party will constitute, a legal, valid and binding obligation of the respective Loan Parties party thereto enforceable in accordance with its respective terms. When executed and delivered by a Guarantor, the Subsidiary Guaranty will constitute a legal, valid and binding obligation of such Guarantor enforceable in accordance with its terms. The foregoing representations and warranties are subject to the qualifications that the enforcement of each of the instruments referred to therein may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of rights of creditors generally, and that enforcement of rights and remedies set forth therein may be limited by judicial discretion regarding the enforcement of, or by applicable laws affecting, remedies (whether considered in a court of law or a proceeding in equity).
7.4 Financial Statements . The Borrower’s audited consolidated financial statements as at December 31, 2004 have been prepared in conformity with GAAP applied on a basis consistent with that of the preceding Fiscal Year (except as noted therein) and fairly present the consolidated financial condition of the Borrower and its consolidated Subsidiaries as at such date and the results of their operations for the period then ended. Since December 31, 2004, no event or events have occurred which, individually or in the aggregate, would reasonably be expected to have a Materially Adverse Effect, except as disclosed in such unaudited financial statements or in Schedule 3 .
7.5 No Litigation; Material Contingent Liabilities . No litigation (including derivative actions), arbitration proceedings or governmental proceedings are pending or, to the best knowledge of the Borrower after due inquiry, threatened against the Borrower or any Subsidiary which would, if adversely determined, either (a) reasonably be expected to result in liability of the Borrower and its Subsidiaries in excess of actual reserved self-insurance amounts, actual uncontested insurance coverage or effective uncontested indemnifications with respect thereto, except as set forth (including estimates of the dollar amounts involved, if practicable) in Schedule 3 or in the financial statements referred to in Section 7.4 , or (b) be reasonably expected to have a Materially Adverse Effect. Neither the Borrower nor any of its Subsidiaries has knowledge of any material contingent liabilities, including those disclosed in the financial statements referred to in Section 7.4 or in Schedule 3 , which would reasonably be expected to have a Materially Adverse Effect.
7.6 No Approvals, etc . No authorization, consent, approval, license or formal exemption from, nor any filing, declaration or registration with, any court, governmental agency
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or regulatory authority (whether Federal, state, local or foreign), including the Securities and Exchange Commission, any securities exchange, and the Surface Transportation Board, is required in connection with the execution, delivery or performance by any Loan Party of any Loan Document, or the issuance of the Notes in the manner and for the purpose contemplated by this Agreement, it being understood and agreed that no representation or warranty is being made herein with respect to any authorizations, consents, approvals, licenses, exemptions, declarations or registrations required in connection with the Borrower’s performance of its covenant contained in Section 8.7 .
7.7 Fire, Strike, Act of God, etc . Neither the business nor the properties of the Borrower nor any of its Subsidiaries are presently affected by any fire, explosion, accident, labor controversy, strike, lockout or other dispute, drought, storm, hail, earthquake, embargo, act of God or of the public enemy or other casualty which would reasonably be expected to have a Materially Adverse Effect, or if any such existing event or condition were to continue for more than thirty (30) additional days (unless in the reasonable opinion of the Borrower such event or condition is not likely to continue for such period) would reasonably be expected to have a Materially Adverse Effect.
7.8 Liens . None of the assets of the Borrower or any of its Subsidiaries is subject to any Lien except for Permitted Liens.
7.9 Subsidiaries . The Borrower has no Subsidiaries on the date of this Agreement except those listed in Schedule 5 .
7.10 ERISA . Each Plan and, to the best of the Borrower’s knowledge, each Multiemployer Plan, complies in all material respects with Applicable Law and:
(a) no Reportable Event for which the PBGC has not waived the 30-day notice requirement has occurred with respect to any Plan or, to the best of the Borrower’s knowledge, any Multiemployer Plan;
(b) no steps have been taken to terminate any Plan which could result in the Borrower’s making a contribution, or incurring a liability or obligation, to such Plan in excess of $1,000,000; no steps have been taken to appoint a receiver to administer any such Plan; to the best of the Borrower’s knowledge, no steps have been taken to terminate or appoint a receiver to administer any Multiemployer Plan which could result in the Borrower’s making a contribution, or incurring a liability or obligation, to such Multiemployer Plan; and neither the Borrower nor any Related Person has withdrawn from any such Multiemployer Plan or initiated steps to do so;
(c) there is no Unfunded Vested Liability with respect to any Plan or, to the best of the Borrower’s knowledge, any Multiemployer Plan, that would reasonably be expected to have, in the event of termination of such Plan or withdrawal from such Multiemployer Plan, a Materially Adverse Effect; and
(d) no contribution failure has occurred with respect to any Plan sufficient to give rise to a Lien under Section 302(f) of ERISA; no condition exists or event or transaction has occurred with respect to any Plan which would reasonably be expected to
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have a Materially Adverse Effect; and neither the Borrower nor any of its Subsidiaries has any contingent liability with respect to any post-retirement benefit under a Welfare Plan, other than liability for continuation coverage described in Part 6 of Title I of ERISA, that would reasonably be expected to have a Materially Adverse Effect.
7.11 Investment Company . Neither the Borrower nor any Subsidiary is an “investment company” or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940.
7.12 Public Utility Company . Neither the Borrower nor any Subsidiary is a “public-utility company,” or a “holding company,” or a “subsidiary company” of a “holding company,” or an “affiliate” of a “holding company” or of a “subsidiary company” of a “holding company,” within the meaning of the Public Utility Holding Company Act of 1935.
7.13 Margin Stock . The Borrower is not engaged principally, or as one of its important activities, in the business of extending, or arranging for the extension of, credit for the purpose of “purchasing or carrying any margin stock,” within the meaning of Regulation U of the FRB. No portion of the assets of the Borrower consists of any such margin stock, and no part of the proceeds of any Loan or Indebtedness with respect to commercial paper will be used to purchase or carry any such margin stock within the meaning of said regulation or to extend credit to others for such purpose.
7.14 Accurate Information . All factual information (taken as a whole) previously furnished by any Loan Party to the Administrative Agent or any Bank for purposes of or in connection with this Agreement (including the factual information contained in the Schedules and Exhibits hereto and in the Bank syndication information memorandum) or any transaction contemplated hereby or thereby or by any other Loan Document is, and all other such factual information (taken as a whole) hereafter furnished by any Loan Party to the Administrative Agent or any Bank for purposes of or in connection with this Agreement or any transaction contemplated hereby or by any other Loan Document will be, true and accurate in every material respect on the date as of which such information is dated or certified and is not and will not be incomplete in any material respect as of such date due to any failure to state any fact necessary to make such information not misleading as of such date in light of the cir | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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